Tentative translation
November 30, 2005
Financial Services Agency
The Government of Japan
Administrative Actions on Zurich Insurance Company Japan Branch
- Regarding Zurich Insurance Company Japan Branch (hereinafter referred to as the ''Branch''), according to the results of the on-site inspection (notified on June 17, 2005) conducted by the Financial Services Agency (hereinafter referred to as the ''FSA'') and the reports from the Branch based on Article No. 200 (1) of the Insurance Business Law (hereinafter referred to as the ''IBL''), the following problems are confirmed, in addition to the problems regarding the non-payment of fringe claims that triggered business improvement orders issued on November 25, 2005.
(1) | Business operations impairing the protection and convenience of customers | ||||||||
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(2) | Improper reporting system to the FSA | ||||||||
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(3) | The operational risk management system Concrete rules for operational risk management at each business department and other departments are not stipulated in the internal rules, and the Legal Affairs Team of the Branch cannot provide any clear guidance for securing its accurate processing. Thus, individual staff of each business department handles operational processing at his/her discretion, and it is insufficient and lacking uniformity as a branch. |
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(4) | The governance system | ||||||||
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- Judging from the problems described above, the FSA issued the following administrative actions (Business Improvement Order) to the Branch, based on Article No. 204 (1) of the IBL, today.
(1) | Examine immediately whether all operations, including claim payment and settlement of complaint, are proper in the terms of the protection and convenience of policyholders, and promptly rectify any problem. |
(2) | Establish and improve the governance system including internal audit, internal control system, and compliance system so as to be continuously effective. |
(3) | Clarify the responsibilities of officers and employees who caused the problems triggering the business improvement order. |
(4) | Regarding (1) to (3) described above, a business improvement plan that describes concrete measures and the timing of the implementation must be submitted by December 14, 2005. |
(5) | The progress and implementation of the business improvement plan and the status of the improvement must be reported every three months until the implementation of the plan is completed. |
Contact:
Financial Services Agency TEL: 03-3506-6000(main)
Insurance Business Division, Supervisory Bureau
(Extension: 3375, 3772)
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