Japanese life insurers are increasingly turning to Bermuda-based reinsurance structures as they adapt to regulatory frameworks and market challenges, industry leader said yesterday.

Kazuyuki Hayashibara, director of Dai-Ichi Re, noted on a panel at the Bermuda International Long-Term Insurers and Reinsurers Life and Annuity Conference that “Japan's capital framework introduction has helped clarify” insurance needs, making it easier for insurers to understand market requirements.

However, Japan's personal information protection laws can create hurdles because property owners must provide personal data to insurance companies under specific contract conditions.

The regulatory environment, he said, also called for “clear explanations and proper consent from elderly persons during insurance contract processes”, making the process more complex but creating opportunities for insurers who can figure out how to navigate it.

These adaptations line up with broader market trends identified in a recent AM Best report, which documented an “uptick in Japanese insurers ceding business directly to Bermudian reinsurers or through existing Bermudian-based affiliates”.

The shift comes as Japan implements new capital frameworks based on International Capital Standards all while grappling with low interest rates and an ageing population.

Meanwhile, Bermuda's appeal has grown alongside greater demand for retirement solutions, with Bermuda gaining prominence as American life insurers also expand their reinsurance leverage, which ended 2024 at 328 per cent, according to AM Best's Edward Kohlberg. The trend reflects the broader international shift towards offshore reinsurance.