Japan Post Network chooses Aflac as exclusive provider of cancer insurance
Japan Post Network Co. has chosen Aflac Japan, a unit of U.S.-based supplemental insurer Aflac Inc., as the exclusive provider of cancer insurance for distribution through its roughly 24,000 post offices nationwide.
“Given the extensive number of post office locations, we anticipate that over-the-counter sales will play an important role in the future,” said Laura Kane, a spokeswoman for Aflac Inc. However, the company isn’t ready at this point to share expectations on future revenue or earnings from the deal, she said.
Japan Post Network is one of four separate postal entities that started operating in October as a part of the postal privatization process established under laws enacted in 2005, the Columbus, Ga.-based Aflac said.
Japan is Aflac Inc.’s biggest market, where it derives about 75% of its total revenue. The company says it’s the No. 1 insurance company in terms of individual insurance policies in force in Japan. Kane said cancer is the No. 1 killer in Japan and Aflac is the biggest seller of cancer insurance in that country.
“We believe Japan Post’s selection of Aflac reflects the quality of our newly introduced Cancer Forte product, the overall strength of the Aflac brand, a reputation for quality customer service and the support we provide to our sales force,” Daniel P. Amos, Aflac Inc.’s chairman and chief executive officer, said in a statement. Sales should occur sometime in 2008, he added.
In the third quarter, Aflac, known for its white duck advertising mascot that quacks the company’s name, reported a profit of $420 million, an increase of 14.4% from same period a year ago. Aflac Japan saw new annualized premium sales rise 2.2% to $236 million. Cancer insurance sales, up 21.8%, contributed to increase (BestWire, Oct. 23, 2007).
“Throughout 2007, we have been encouraged by the overall direction of Aflac Japan’s new annualized premium sales,” Amos said. “We continue to believe that our sales will be flat to up 4% in the second half of 2007.”
In October, Japan’s government-run postal system was broken into four units, wholly owned by a government holding company, with the Kampo and Yucho segments becoming the world’s largest life insurer and savings bank, respectively (BestWire, Feb. 2007).
American Family Life Assurance Company of Columbus currently has a Best’s Financial Strength Rating of A+ (Superior).
