The unit, known as AIG Fuji Life Insurance Company (Afli), was founded in 1996 as a subsidiary of Fuji Fire and Marine Insurance Company and has achieved rapid growth by developing competitive life insurance products and new distribution channels.
It will now be taken over by FWD, the insurance arm of Pacific Century Group, subject to regulatory approval.
Non-life business
In a joint statement with FWD on Monday, AIG said the sale will not affect the company’s extensive non-life insurance business in Japan, considered the largest of any foreign-based insurer in the country.
The insurer added that it will continue to focus on Japan’s property and casualty market through its local subsidiaries Fuji Fire & Marine, AIU Insurance Company, and American Home Assurance Company.
Japan, where AIG has operated since 1946, is the third largest commercial market and the largest personal insurance market globally for AIG, based on net premiums written by country.
After completion, FWD Group will maintain Afli’s existing life insurance distribution agreements with AIG Japan.
“Like other actions we’ve taken this year, the sale of AIG Fuji Life makes us a leaner insurer that’s better focused on the geographies and segments where we have the critical mass and expertise to provide tremendous value to our clients,” said Peter Hancock, AIG’s chief executive.
“In this core market for AIG, we are committed to growing both our commercial and consumer personal insurance lines. At the same time, our AFLI clients and colleagues will benefit from FWD’s commitment to growing the life business in Japan. Beyond the deal’s close, we look forward to partnering with FWD on life distribution in support of its goals, and in exploring other future opportunities.”
Meanwhile, FWD’s entry into Japan, the second largest life insurance market in the world, will extend the insurers existing regional footprint.
Launched in launch in 2013, FWD has already become a leading pan-Asian life insurer with operations in Thailand, Indonesia, the Philippines, Singapore, Vietnam, underpinned with a strong base in Hong Kong and Macau.
“AIG Fuji Life is a strong foundation for FWD’s entry to Japan and our partnership with AIG will give FWD access to an extensive distribution network with an established customer base. We aim to develop and grow Afli through investment in the long-term and our customer-led, technology-driven approach,” said Huynh Thanh Phong, chief executive of FWD Group.
Sun Life deal
In August, the Canada’s Sun Life acquired the Hong Kong pension business of FWD Group, entering into an exclusive 15-year distribution agreement that will allow Sun Life HK to distribute its pension products through FWD’s agency force in the city-state.
