The Fair Trade Commission plans to order four major property insurers to cease operations for forming a cartel over premiums for joint insurance contracts for Keisei Electric Railway, in violation of the Antimonopoly Law, sources with knowledge of the matter said.
The antimonopoly watchdog will decide on the orders, which include requiring the compilation of measures to prevent recurrence, after gathering opinions from the four companies — Tokio Marine & Nichido Fire Insurance, Sompo Japan Insurance, Mitsui Sumitomo Insurance and Aioi Nissay Dowa Insurance. The FTC has already informed them of the planned orders, the sources said.
The commission last month notified the four insurers of its intention to impose a cease and desist order on them for pre-arranging premiums for joint insurance contracts for the Tokyu Group and Sendai International Airport.
According to the sources, the four insurers began pre-arranging premiums for the joint contracts for Keisei Electric Railway in December 2019 or earlier, sharing the risk of covering insurance payments.
The FTC plans to fine Tokio Marine & Nichido Fire, Mitsui Sumitomo and Aioi Nissay Dowa a total of ¥120 million. Sompo Japan is expected to avoid the fine because it voluntarily reported the wrongdoing under a leniency program, the sources said.
The committee is also investigating insurers’ contracts with other clients, such as Cosmo Oil.
As for the individual insurance contracts, the three insurers, with the exception of Aioi Nissay Dowa, have recorded successful bidders and bid prices for tenders held by the Tokyo Metropolitan Government regarding auto insurance for its official vehicles.
The FTC plans to issue a cease-and-desist order to the three, and Sompo Japan will likely have to pay a fine of about ¥35 million.
