FSA may put off letting banks sell insurance products till Dec. 2007.
The Financial Services Agency is considering allowing banks to sell all types of insurance products from December 2007, eight months later than originally planned, due to opposition from the insurance industry and some policymakers, sources close to the matter said Wednesday.
Although the FSA had also planned to make savings-based insurance products, including endowment insurance, eligible to be sold at banks from April this year, it is now in the final stages of coordinating with the insurance industry to delay the date by eight months to December, the sources said.
The postponements are due to strong opposition from major insurers worried about growing competition from banks in the insurance business, they said. Some insurers are concerned that banks may take advantage of their loans to pressure borrowers into buying insurance products.
Some policymakers in the ruling Liberal Democratic Party are also strongly opposed to the initial plans, delaying necessary adjustments to allow such sales.
To ease such opposition, the FSA plans to check if any serious problems occur in banks' sales of insurance products during the two years when they are able to sell savings-based insurance products from December 2005 to December 2007, when all types of insurance products will become available at banks, they said.
The FSA also plans to consider taking measures to prevent inappropriate sales of insurance products by banks, such as by prohibiting banks from selling insurance products to small borrowers.
Since a complete ban on banks' selling insurance products was lifted in April 2001, the FSA has gradually expanded the range of insurance products banks can sell.
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|Publication:||Japan Weekly Monitor|
|Date:||May 23, 2005|
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