It believes it can beat into Japan's mature insurance market with new product development and diversified distribution strategy to meet changing dynamics.
According to Manulife, Japan's aging population and weak stock market propose potential for life insurance, which can build protection for wealth management and long-term savings. Mark Oberhellman, vice president and chief product officer of Manulife Japan, said the country's "economic, socioeconomic and demographic trends present new opportunities to Japan's whole life insurance sector.
Oberhellman said an aging population has enlarged demand for products that can accumulate, preserve and transfer wealth. At the same time, Japan's stock market performance has been low in the past two decades and interest rates have hovered near 0% during the past 10 years.
These conditions have led customers to turn toward products like medical insurance and to deposit alternatives such as fixed annuities and variable with an essential guarantee, said Oberhellman, in an interview. The company is well-poised to meet these opportunities that the market offers, he said.
Japan's insurance market saw increase in medical insurance, fixed annuities and variable annuities prior to the global economic downturn. As the economy improves, I expect that sales of annuity products will start growing again," said Oberhellman. "Additionally, any more cutbacks in the national health care system will also likely profit the sales of medical products."
Japan's economy is expected to see continued increase in the second quarter from the previous quarter for the fifth quarterly gain, though at a slower rate, supported by growth of capital investment and exports, particularly to emerging markets. In the first quarter ended June 30, Japan's gross domestic product rose at an annual rate of 5%, and 1.2% from the previous quarter, according to the Cabinet Office of Japan.
