When the 2011 earthquake in Tohoku first struck Japan, JPY1.24 ($7.6bn) of claims were initially paid out to 764,792 policies. Surprisingly, more than a decade later, the Japan Earthquake Reinsurance (JER) Company still reports ongoing claims servicing, with payouts reaching JPY1.29tn and 826,474 policies as of March 2025.
Also known as the Great East Japan Earthquake, the 2011 earthquake in Tohoku was notable for being “the first earthquake with a recorded magnitude of 9.0 in Japan’s history”, according to Toa Re’s report, “Japan Insurance Market 2025”.
Called the “largest earthquake in Japan’s modern history” by NASA, the event and resulting tsunami devastated the region.
In 2021, Moody’s said the earthquake and tsunami cost the industry $35bn (as of 2021) in insured losses. At that time, the company also said it was “the largest earthquake insurance loss in history”.
Munich Re also identified the 2011 event as “the costliest earthquake of all time”, with overall losses of $135bn (as of 2024).
But while the earthquake was behind moderate casualties and property damage, it was the triggered tsunami that caused majority of the devastation and loss of lives, according to a 2012 review by Munich Re, titled ‘Review of natural catastrophes in 2011: Earthquakes result in record loss year’.
“Some 16,000 people were killed in spite of high protective dykes and an excellent early-warning system. Without these protective installations, the death toll would have been much higher,” said Munich Re in the review.
“The tsunami-exposed northeast of Japan is believed to have last been hit by a seismic sea wave of this size in the year 869.”
Rising earthquake insurance penetration and attachment rates
Even though earthquake insurance penetration was already on the rise in the country, driven by the Great Hanshin-Awaji Earthquake in 1995, the Great East Japan Earthquake is credited for raising the insurance attachment rate in the Japan, the report showed.
Despite this, the report also stated, “the current earthquake insurance attachment rate is still only 69.7%, and the household penetration rate is 35.1%”.
The report also defined earthquake insurance attachment rate as “the proportion of household fire insurance policies that include earthquake insurance compared to all household fire insurance policies”.
Statistics compiled by the JER show a sharp spike in attachment rates after the Great East Japan Earthquake in 2011, alongside rising earthquake insurance penetration rates.
Moreover, Toa Re’s report pointed out that earthquake insurance penetration had been on the rise since 1995, when the Great Hanshin-Awaji Earthquake struck Japan, and left more than 6,000 killed or missing, as well as more than 100,000 destroyed homes.
It was then that “public awareness of earthquake risk increased, and earthquake insurance gained traction rapidly”, the report said.
But despite the rise in earthquake insurance penetration, as well as attachment, rates, Toa Re also noted that there is “still room for further traction”. (See Table 1 below.)
Reinsuring earthquake insurance
Following the launch of earthquake insurance in Japan, JER was established in 1966.
JER “reinsures the earthquake insurance contracts underwritten by non-life insurance companies to take on full liability”, before passing on the risk proportionally to non-life insurance companies and the government by retrocession according to the limit indemnity, JER’s 2015 annual report stated.
The report also noted that the organisation takes up the remaining indemnity.
According to JER’s 2025 annual report, JER also manages and operates “insurance premiums paid by policyholders as the sole earthquake reinsurance company in Japan”.
Claims after Tohoku
Reinsurance
According to figures from JER in the fiscal year 2011, 710,821 reinsurance claims made on the basis of insurance policies in relation to Great East Japan Earthquake. These were serviced with reinsurance payouts of JPY1.19tn ($7.6bn).
Since then, JER has been servicing reinsurance claims and payouts related to the disaster, with the number of claims serviced topping yearly lists of top five earthquakes in the country until the 2016 fiscal year (where it was ranked third), according to statistics from the organisation.
The event finally fell out of JER’s yearly lists of top five earthquakes by reinsurance claims paid in the 2021 fiscal year, though the reinsurer continued servicing the disaster.
For instance, JER’s most recent annual report from 2025 showed that the reinsurer was still processing claims for the disaster more than a decade after the event, as the number of reinsurance claims paid climbed from 826,335 in the fiscal year 2023 to 826,474 in 2024’s fiscal year.
For comparison, reinsurance claims for another 2011 earthquake, which struck Miyagi-ken-oki, were settled by 2014.
Additionally, the Great East Japan Earthquake remains the top earthquake in JER’s latest top 20 list according to reinsurance claims paid since the establishment of the earthquake insurance system. It leads by a considerable margin, with JPY1.29tn paid out as of 31 March 2025, as compared to the 2016 Kumamoto earthquake (ranked second) with a total payout of JPY391.3bn so far. (See Table 2 below.)
General insurance claims
According to figures from the General Insurance Association of Japan’s (GIAJ) 2011-2012 Fact Book, the Great East Japan Earthquake resulted in a JPY5.5tn of net claims paid out, 27.5% more than the previous year (JPY4.3tn).
While this constituted what the GIAJ called “a drastic increase”, the organisation also noted that the figure could be attributed not just to the earthquake, but also typhoons in the country, as well as floods in Thailand.
“Total assets decreased 5.7% to JPY28tn, reflecting the large volume of claim payments for the Great East Japan Earthquake,” the report also stated.
“Working assets also decreased to JPY24.9, down 6.3%.”
In the GIAJ’s 2012-2013 Fact Book, it was stated that net claims paid on all classes of insurance that year amounted to JPY4.8tn, “a drastic decrease of 13.3% compared with the previous term which included massive payments for the Great East Japan Earthquake”.
Formation of earthquake project team
In JER’s 2016 annual report, it was noted that although claims were promptly paid to policyholders affected by the disaster through earthquake insurance, “the contingency reserves of private-sector insurance companies were largely depleted following the payment of such an enormous amount of claims, reducing their ability to pay future claims”.
At the same time, there were also concerns regarding the possibility of another future large earthquake, which JER noted prompted “calls for an increase in the robustness of the earthquake insurance system”.
“Under these conditions, the Basic Policy on Special Account Reform approved by Cabinet resolution on 24 January 2012 stated with respect to the earthquake insurance system that ‘in light of the recent earthquake, the government will urgently revise the total amount of approved claims and the amount of public and private sector insurance liabilities and also examine the commercial nature of earthquake insurance’,” said the report.
“In April 2012, the Earthquake Insurance System Project Team was established in the Ministry of Finance.”
Scale of the disaster
Since the Great East Japan Earthquake took place in 2011, it has consistently appeared in released disaster listings and comparisons in the insurance industry.
For instance, it still tops the GIAJ’s 10 Largest Claims Paid for Earthquake Insurance on Dwelling Risks list, outpacing the 2016 Kumamoto earthquake ranked second in terms of claims paid (JPY1.28tn, as compared to JPY382.4bn).
The US Geological Survey also ranks the Tohoku earthquake fourth on its list of 20 Largest Earthquakes in the World on Map, according to magnitude.
In 2022, CRESTA linked the magnitude-7.0 Fukushima earthquake in 2021 and magnitude-7.3 Fukushima earthquake in 2022 to the Tohoku earthquake, noting that both events could be “considered long-term aftershocks”. A