Cost of secondary (voluntary) car insurance in Tokyo?

[jesusgal4100]

@nusans I suppose we would have to agree to disagree.

From my experience and from speaking friends and clients in the industry, the online auto insurers absolutely do offer more limited coverage that allow them more success in denying claims. They are charging 20-30% less, so I think this makes sense economically (although I have no knowledge or visibility over how the premiums are calculated).

In terms of the overall market here, Japan is the second largest insurance market after America, and all of the major (and not so major) international players are here. I understand that (of course) the specific products are designed for the Japanese market, and in many cases differ from, say, America. This is true for any market. Insurers chase risks in market, and those risks differ from place to place. I am told by my friends and clients in the industry that Japan is more similar to the European market, rather than America.

In terms of paying out, perhaps I’m too cynical when it comes to insurance companies, but my assumption is that they all will try to maximize premiums and minimize pay outs. Whether they have grounds to refuse to pay out comes down to the terms of the policy they write. When choosing my insurer for my car, I was lucky enough to be able to ask my colleagues who have legal practice in this area to help me review the policy. If I am unlucky enough to have to rely on the policy, I will certainly argue against any attempt to not pay out that is inconsistent with the policy, as I would anywhere. I very much hope not to have to do so though.

 

[nusans]

@jesusgal4100 Agree to disagree on what? That auto insurance in Japan is the same as North America? It's not! Japan's auto insurance offerings are 15+ years behind. Payouts for auto injuries in Japan are an absolute joke as are payouts for medium to large accidents or vehicle writeoffs.

For anyone driving a kei or second hand vehicle under 3mil, numbers wise it makes no sense to get all the extra bells and whistles coverage as on average most basic accidents/repairs are under 140,000yen and you have to pay a waiver fee to use the insurance and your insurance goes up by 300,000 over the next 5 years if you have just one accident. The other issue with policies and payouts in Japan often also comes down to the fact that they will make you at fault in an accident regardless of if the other party was doing something illegal or not. Ie. in North America it's common and easy to be 0% at fault and the offending party 100% (ie. if you get rear-ended or reversed into etc.) and pay nothing and have any repairs or medical bills paid by the other parties insurance but in Japan it's basically never a 100-0 split unless your vehicle was legally parked and you weren't sitting inside.

The payouts issue or denying of claims isn't an issue of purchasing the insurance online. If you're going with any large/reputable insurance company like AXA or SBI etc like I mentioned they don't offer any less then what you'd get by going into an insurance office. You select what you want or don't want or to what level of covered you want to be part of the policy. Purchasing online is cheaper because the overhead of not having a physical office and staff is much lower. Tokio Marine gives us a discount based on insuring a fleet of vehicles but the offerings are virtually the same as my personal auto insurance vs AXA. All of the insurance claim issues I've experienced or had friends experience had has been with the auto insurance not purchased online including Tokio Marine & Nichido Fire Insurance Co. They literally send someone physically to my business everytime we want to insure a new vehicle or change something on a policy, nothing is done online.

Regarding overall insurance market the USA and China (which is growing super fast) are the highest with the USA being over 42% and china over 11% of the global market share and Japan being around 5% at most (with 74% of that being life insurance policies) but we aren't talking overall insurance market we are talking auto insurance specifically which like many industries in Japan are not competitive and haven't been domestically challenged shaken up for decades.

 

[jesusgal4100]

@nusans Agree to disagree on your statement that “ It has nothing to do with online insurers being shady”, for the reasons I explain in the remainder of my message.

Edit to add that I am not inferring that the experiences you describe are incorrect, and I am not trying to disagree with your views.

For context, I am a lawyer (in a mostly unrelated field) and so I tend to approach such topic as such. For example, considering the terms of the policies written. I am not so involved or knowledgeable about the commercial aspects as a comparative study with other markets, or indeed the experience of insured people. It seems that you are, and of course I am not challenging your views on these topics.

For example, my policy states that my vehicle will be replaced if repair costs are 50% or greater, with very few exclusions attached to this. Some of the online policies had higher thresholds (75% was common), and had a greater number of exclusions that the insurer could seek to rely upon. I don’t doubt the insurer would seek to not pay for a new vehicle to the extent they legally can. And I would be well prepared to challenge this.

 

[nusans]

@jesusgal4100 Well that's silly as I never said online insurers are shady, you did, and you didn't provide any information to back that statement up whatsoever other then "my friend told me." The issues/differences I mentioned and experiences with the auto insurance industry in Japan is relating to the auto insurance industry as a whole and not where you purchase.

The big names that offer the best online insurance deals are massive and regular insurance companies where you can go to their office locations and also manually purchase the insurance but it takes more time and costs more to do so but the offerings are the same. For instance AXA the company I'm personally using for my auto insurance did € 900 billion (2022) in and has 149,000 employees.

Again, the biggest issues I've experienced have been with auto insurance not purchased online ie via Tokio Marine & Nichido Fire Insurance Co. and SOMPO JAPAN NIPPONKOA INSURANCE INC. etc.

 

[jesusgal4100]

@nusans My apologies, I think the conversation threads are getting lost due to being on mobile.

I certainly used the adjective “shady” to describe the online-only insurance companies.

To be clear, these are the insurers that are online only. AXA writes policies through online application, but obviously are not “online only”.

Also, to clarify, my use of shady was reference to the terms of the policies such online insurers write with many exclusions and so on, and their practice in relying on such exclusions and so on to not make payments. I understand that these more limited policies, and this more aggressive practice, allows them to charge lower premiums (among other things).

I am sorry I don’t have much to back that up other than my own review of the polices as a lawyer here, and from discussing with colleagues who practice in the area (as well as folks in the industry who are my clients). Please feel free to disregard!

 

[jamessmith112]

@nusans Thank you. I tried the Sony Sompo online calculator as another person suggested.

Do you know if there's a site where you can get comparative quotes from multiple providers?

 

[nusans]

@jamessmith112 Yes, I used https://hoken.kakaku.com/kuruma_hoken to compare. I do suggest going with a fairly large insurance company like SBI or AXA etc. but they most often have the best offerings anyway. You can fill out a basic application of what you're looking for and then a few of the big auto insurance companies email with their offers and the option to actually apply/purchase insurance through them.

 

[dougt]

@jamessmith112 It depends on a lot of factors but one big one would be that you will not have a gold license. Which will increase the cost significantly. But other factors like type of car, make etc will need to be factored in.
If it’s a sports car then be ready to pay a premium. If it’s a Japanese sports car then it might not be as bad.

For example when I was getting insurance for my car, I just converted my license. The insurance quote had an extra 150,000 a year compared to when I applied using my wife’s gold license.

 

[slashin8r]

@dougt The gold license doesn't actually affect the price by much. It is less than 5000yen/year difference in my case.

 

[jesusgal4100]

@slashin8r The number of clean driving years makes a huge difference. Can halve the cost.

 

[dougt]

@slashin8r Ah it probably really depends on driving years and license. Specifically relating to OP, I bought a sports car so when getting insurance it was 210,000 a year for my wife. Whereas I was quoted around 375,000 a year on a new license.

 

[jamessmith112]

@dougt Thanks for the info. I tried an online calculator as someone suggested and got quotes from 150,000 to just over 200,000 yen depending on the options. I was expecting more but I suppose because I'm a bit older this works in my favor.

 

[jamessmith112]

@dougt Thanks for the reply. Yeah I will be a new driver as far as Japan is concerned. On the flip side I'm older (but not yet geriatric) which in this case works to my favor.

 

[fugi]

@jamessmith112 Depends on a lot of factors. It is better to get a quote online from a company like SBI, AXA, Zurich, etc.

To give you an example, I started paying 15,000 yen per month on my car (1988 Nissan), 3 years later and I'm paying 5,000 yen per month (first time getting insurance, the license was green and now is blue, etc.).

My wife pays around 3,000 yen per month for her kei (2004 Daihatsu).

 

[jamessmith112]

@fugi Thanks for the insight. I'm surprised at the huge difference between the first time and 3 years later!