Sumitomo Life Explores AI Tools to Modernize Insurance Sales Operations

TLDRs:

• Sumitomo Life considers AI to assist agents amid stricter rules on staff secondments.
• Japanese insurers face industry reform after recent scandals involving employee loans.
• Generative AI may replace traditional staff support in Japan’s bancassurance networks.
• Insurtech adoption could boost Japan’s life insurance market to $371 billion by 2029.

Japan’s Sumitomo Life Insurance is actively exploring the use of artificial intelligence and other digital technologies to support its network of sales agents.

The company’s president, Yukinori Takada, highlighted that the initiative is part of a broader effort to modernize operations and improve efficiency. AI tools, including generative AI systems, could help agents streamline administrative tasks, manage client information, and enhance sales processes without relying on traditional staff secondments.

Industry Reforms Prompt Change

The move comes amid significant changes in Japan’s insurance landscape. In September 2024, the General Insurance Association of Japan (GIAJ) implemented a ban on loaning employees to partner sales teams.

The Financial Services Agency (FSA) has also indicated plans for stricter oversight, reflecting concerns over past misconduct. Scandals involving secondees, including data leaks and misuse of bank information, have prompted insurers to rethink how they support agents. Takada emphasized that the period marks a major transition in insurer-agent relationships.

AI as a Solution to Secondment Risks

Traditionally, Japanese life insurers deployed staff to assist agents, such as bank employees, in selling insurance products. However, with the end of secondments likely by April 2026, major insurers including Sumitomo Life, Nippon Life, and Meiji Yasuda Life are exploring alternatives.

Generative AI and compliant agent enablement tools can potentially replace human secondees, providing capabilities such as handwriting recognition, suitability documentation, and audit trail management.

These tools allow agents to operate efficiently while adhering to regulatory requirements, reducing the risks associated with staff loans.

Growth Opportunities with Insurtech

Japan’s life insurance market remains large and growing. Analysts project direct written premiums, insurers’ revenue before reinsurance, could reach $371.2 billion by 2029, up from $275.8 billion in 2024 at a compound annual growth rate (CAGR) of 4.7%. Insurtech solutions are increasingly seen as essential for modernizing systems built over decades.

Some insurers, like Tokio Marine, have already partnered with global AI providers such as OpenAI, while startups like Lazarus AI are entering Japan to speed up insurance operations using technology originally developed for intelligence analysis in the U.S.

Takada’s remarks, made during a meeting in Bellevue, Washington with heads of Sumitomo Life’s overseas subsidiaries, indicate that AI adoption is not only a compliance solution but also a strategic step toward long-term modernization. As Japanese insurers pivot to digital support tools, the sector may see improved operational efficiency, stronger compliance, and new opportunities to serve a rapidly evolving client base.

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