Search

 

Cablegate: Japan: Insurance Advocacy Pays Off for U.S.

VZCZCXRO5476
RR RUEHFK RUEHGH RUEHKSO RUEHNAG RUEHNH
DE RUEHKO #5610/01 3531003
ZNR UUUUU ZZH
R 191003Z DEC 07
FM AMEMBASSY TOKYO
TO RUEHC/SECSTATE WASHDC 0428
INFO RUEHFR/AMEMBASSY PARIS 5889
RUEHMO/AMEMBASSY MOSCOW 2019
RUEHUL/AMEMBASSY SEOUL 6771
RUEHBJ/AMEMBASSY BEIJING 0722
RUEHKSO/AMCONSUL SAPPORO 5694
RUEHNAG/AMCONSUL NAGOYA 3775
RUEHNH/AMCONSUL NAHA 7453
RUEHOK/AMCONSUL OSAKA KOBE 8722
RUEHFK/AMCONSUL FUKUOKA 5057
RUEHGH/AMCONSUL SHANGHAI 0281
RUEHHK/AMCONSUL HONG KONG 6389
RUEHBS/USEU BRUSSELS
RUEATRS/TREASURY DEPT WASHDC
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC
RUEHIN/AIT TAIPEI 6814

UNCLAS SECTION 01 OF 02 TOKYO 005610

SIPDIS

SENSITIVE
SIPDIS

STATE FOR EAP/J, EEB
PARIS FOR USOECD
USTR FOR MEYERS AND BEEMAN
TREASURY FOR IA/DOHNER, HAARSAGER, AND POGGI
DOC FOR 4410/ITA/MAC/OJ/MELCHER

E.O. 12958: N/A
TAGS: ECON EFIN BEXP JA
SUBJECT: JAPAN: INSURANCE ADVOCACY PAYS OFF FOR U.S.
COMPANIES

REF: A. TOKYO 4658
B. TOKYO 4555
C. TOKYO 2716
D. TOKYO 1916
E. TOKYO 894

Summary
-------
1. (SBU) Over the past several months, U.S. insurers have
struck deals to market products through Japan's extensive
postal network, taking advantage of Japan Post's
privatization. They are also poised to capitalize on
deregulation measures, set to go into effect December 22,
that will allow banks to sell a full range of insurance
products. One U.S. industry official estimated the bank
sales liberalization alone will generate hundreds of millions
of dollars in revenue for U.S. companies. The U.S.
government has been working closely with U.S. industry in a
multi-year push for these opportunities. End summary.

Advocacy Pays Off
-----------------
2. (SBU) Over the past several months, U.S. insurers have
struck deals to market products through Japan's new postal
companies. The postal companies, spun off the massive Japan
Post as it commenced privatization October 1 (reftels), have
a particularly valuable distribution channel through the
nation's 24,000 post offices. Industry officials and media
report that ALICO Japan, an AIG subsidiary, and MetLife (as
part of a joint venture) have tied up with Japan Post Bank to
sell variable annuities. ALICO has also landed one of eight
contracts to supply Japan Post Insurance with policies aimed
at the corporate market. Moreover, AFLAC has announced the
Japan Post Network Co. selected it as its exclusive provider
of cancer insurance.

3. (SBU) The scale of these deals is impressive, even if
exact valuations remain unknown. Japan's insurance market is
the world's second largest. Foreign insurers make up 23.5%
of the life insurance market (FY06 figures) and U.S.
companies' premium revenue in 2007 is expected to be around
$50 billion. AFLAC's stock rose more than 6% -- adding $1.7
billion to the company's market capitalization -- on November
16, the day the company announced its exclusive tie-up with
the Japan Post Network.

4. (SBU) Moreover, U.S. insurers are poised to benefit from
Japan's liberalization of rules that have restricted banks
from selling insurance. The full lifting of those
restrictions will take effect December 22 and will be worth
"hundreds of millions of dollars in revenue" for U.S.
insurers, according to a senior industry official. Access to
the bank sales channel, as well as to the privatized postal
network, were key U.S. government advocacy goals for 2007.
Their realization marks the culmination of a multi-year,
inter-agency effort.

5. (SBU) Embassy Tokyo, working with Washington-based
colleagues at State, USTR, Commerce, and Treasury, used the
full range of tactics to press for U.S. insurers' market
access. Insurance and postal privatization have been raised
through the bilateral Regulatory Reform Initiative, yearly
Insurance Consultations, behind-the-scenes work with key
politicians, public comments on Japanese regulatory
proposals, and direct engagement with all levels of the
Japanese bureaucracy. At every stage, advocacy efforts have
been closely coordinated with U.S. industry, both in
Washington and Tokyo.


TOKYO 00005610 002 OF 002


Comment
-------
6. (SBU) With years remaining before Japan's postal insurance
system is privatized fully, much remains on the insurance
agenda. Nonetheless, U.S. companies' recent successes show
what they can do when sustained government advocacy helps
crack open opportunities in the Japanese market.
SCHIEFFER

© Scoop Media

 
 
 
World Headlines

 



UN: Bachelet Calls On Mexico To Step Up Efforts As Tragic Milestone Reached Of More Than 100,000 Disappearances

UN High Commissioner for Human Rights Michelle Bachelet on Tuesday called on the Mexican authorities to step up efforts to ensure truth and justice for victims of disappearances, who now number more than 100,000, according to official data... More>>


ADC: Statement On The Assassination Of Shireen Abu Akleh

Early this morning in Jenin, Occupied Palestine, revered Palestinian voice Shireen Abu Akleh, a Palestinian American journalist for Al Jazeera, was assassinated by Israeli Occupation Forces snipers...
More>>



Ukraine: UN Rights Office Probe Spotlights Harrowing Plight Of Civilians

Almost 76 days since Russia invaded Ukraine, countless civilians remain caught up in the horror and destruction of war, UN rights investigators said on Tuesday... More>>



Access Now: Elon Musk’s Twitter Buyout Must Not Come At The Expense Of Human Rights

Following today’s announcement that Elon Musk will acquire complete ownership of Twitter in a cash sale of around 44 billion USD, pending shareholder approval, Access Now urges Twitter’s Board, employees, and shareholders... More>>



UN: Biodiversity And Ecosystem Protection Highlighted On Mother Earth Day

Marking International Mother Earth Day, UN General Assembly President Abdulla Shahid urged on Friday, for collective action to safeguard biodiversity and protect ecosystems... More>>

Ukraine: Hundreds More Reach Safety After Fleeing Besieged Mariupol
In Ukraine, humanitarians said on Wednesday that hundreds of people have managed to reach safety after fleeing Mariupol, where there’s also been condemnation for the killing of Lithuanian filmmaker Mantas Kvedaravicius... More>>