As the Japanese demography moves to the super-aged stage, the country's general insurance industry foresees challenges ahead. The immediate demographic challenge for the Japanese non-life insurance industry is lack of growth in the domestic market for its traditional products.
Also, the Japanese non-life insurance groups are increasingly global in scope, so the complexities of managing the business and meeting regulatory requirements are becoming greater. Insurance companies need to attract and retain talent with the right digital skills and international outlook.
The traditional work culture in Japan may be a barrier to this and as such the industry has begun adopting more flexible human resource strategies that allow employees to take more control of their own career.
In what could be construed as a first step in that direction, Japan's Tokio Marine & Nichido Fire Insurance Co. could offer initial monthly salary for university graduates as much as 410,000 yen. This is likely to become applicable for those joining the nonlife insurer in April 2026.
According to a press report by Jiji Press news and published in Japan Times if a career-track employee agrees to be relocated to an area far from his or her current home and actually works there, the monthly salary will increase by as much as some JPY130,000 from the current maximum of JPY280,000.
The aim is to secure and retain excellent human resources amid continuing labour shortages in Japan. A formal decision will be made after consultation with the labour union.
At the same time the non-life insurer is likely to abolish area-based career-track positions, whose work locations are limited, in fiscal 2026, and unify its recruitment to general career-track positions. For those who do not wish to be transferred, the starting salary will be about JPY280,000.
Major Japanese companies are increasingly moving to raise their starting salaries to secure human resources.
Another challenge that could confront non-life insurers is around sales and distribution. The insurance industry has been developing digital capability in the country, but older customers may prefer face-to-face contact. Ageing customers may also be vulnerable and insurance companies need to develop controls to ensure that the sales process appropriately meets the needs of such customers.