Covid-19: Impact on the Japanese life insurance market

After a 2% growth in 2019, the Japanese life insurance market might witness a decline in 2020. The sharp deterioration in GDP due to Covid-19 [4] is believed to impact the life underwritings.

The Gross Domestic Product has decreased by 6.4% in the fourth quarter of 2019 and by 3.4% between January and March 2020 (the fiscal year in Japan starts on July 1st). In Japan, direct sales of life policies account for 70% of the underwritings in the life activity.

Such a situation has impacted the market’s growth due to the social distancing related to Covid-19. In addition, the market is also impacted by the ageing population and the low birth rate which damage the growth prospects of life insurers.