Tokio Marine faces regulatory actions in Japan

Mumbai, Mar 29 | Updated: Mar 30 2007, 06:57am hrs
Tokio Marine, the foreign partner of Iffco-Tokio Marine General Insurance(holding 26% in the joint venture has faced regulatory action in its home country Japan. Recently, Japans Financial Services Agency punished 10 nonlife insurers including Tokio Marine for failing to pay insurance claims.

The Japanese financial watchdog has ordered the suspention of operations of these insurance companies for three months.

They will be prohibited from selling products to new customers from April 2 to July 1, and from applying for government approval of new products until June 14.

However, such a development about Tokio Marine in Japan would not have any implication on its operations in India.

Speaking to FE a senior official of Insurance Regulatory & Development Authority (Irda)said, The punitive action of the Japanese regulator is not that severe to warrant action in India. We would have taken action if the companys license would have suspened.

According to the sources, the Japanese regulator took action against the insurers as the firms rejected insurance claims based only on information supplied by customers, without verifying doctors certificates.

Earlier another Japanse insurer Mitsui Sumitomo Insurance Co, the countrys second-largest property and casualty insurer which had planned to enter India with the partnership of Allahbad Bank had faced punitive action.

The move had delayed the decision of the bank to form the JV to undertake general insurance operations in the country.