Insurance Claim Denied in Japan: ADR and FSA Complaint Guide

Insurance Claim Denied in Japan: Your Rights and Remedies

Japan has one of the world's largest insurance markets, with deeply embedded insurance culture across life, non-life (general), health, and accident insurance products. If your insurance claim has been denied by a Japanese insurer, you have a structured appeals process available — including industry-run Alternative Dispute Resolution (ADR) centers and the Financial Services Agency (FSA) as the ultimate regulatory authority.

This guide covers why claims get denied in Japan, the ADR system, the FSA complaint process, and practical steps to build a successful appeal.

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Japan's Insurance Regulatory Framework

Insurance in Japan is regulated by the Financial Services Agency (FSA — 金融庁) under the Insurance Business Act (保険業法). The FSA supervises all licensed insurance companies, sets conduct standards, and handles consumer complaints.

FSA Website: https://www.fsa.go.jp

FSA Consumer Consultation Desk: 0570-016811 (available weekdays 10:00 AM – 6:00 PM)

FSA Address: 3-2-1 Kasumigaseki, Chiyoda-ku, Tokyo 100-8967, Japan

In addition to the FSA, Japan's insurance industry operates dedicated ADR (Alternative Dispute Resolution) centers under the Insurance Business Act's ADR framework (特定非営利活動法人等の指定紛争解決機関):

• Japan General Insurance Association's ADR Centre (日本損害保険協会 そんぽADRセンター — Sonpo ADR Center): Handles disputes involving non-life (general) insurance — motor, property, travel, accident, and liability insurance.

  • Website: https://www.sonpo.or.jp/soudan/adr/
  • Phone: 0570-022808 (weekdays 9:15 AM – 5:00 PM)

• Life Insurance Association of Japan's ADR Centre (生命保険協会 生命保険相談所): Handles disputes involving life insurance, medical/hospitalization insurance, and cancer insurance.

  • Website: https://www.seiho.or.jp/contact/adr/
  • Phone: 03-3286-2648 (weekdays 9:00 AM – 5:00 PM)

• Medical Fee Dispute Resolution Centre and others for specialized insurance types.

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Why Insurance Claims Get Denied in Japan

Common reasons for insurance claim denial in Japan include:

1. Non-disclosure at application (告知義務違反). Under the Insurance Business Act, policyholders have a duty to truthfully answer questions on the insurance application (the "duty of notification" — 告知義務). Life and health insurance claims are frequently denied when the insurer alleges that the policyholder failed to disclose a pre-existing illness or health condition.

2. Policy exclusions. Japanese insurance policies typically exclude pre-existing conditions (for medical and hospitalization insurance), suicide within the first year or two of a life policy, self-inflicted injuries, criminal acts, and losses due to natural disasters (for certain non-life policies without earthquake/flood riders).

3. Earthquake insurance specifics. Japan has a government-backed earthquake insurance scheme (地震保険) that is separate from standard fire insurance. Disputes about the classification of earthquake damage vs. other causes are common after major seismic events.

4. Accidental vs. illness death. For accident insurance (傷害保険) and combined life/accident policies, whether a death was accidental (external, sudden, and unintentional) is frequently disputed. Insurers may characterize deaths from falls or sudden medical events as illness-related.

5. Medical hospitalization insurance (入院給付金) disputes. Japan's widespread medical hospitalization insurance pays daily hospital benefits. Disputes about the minimum hospitalization period, the necessity of hospitalization, and the definition of "disease" are common.

6. Late notification. Japanese policies typically require prompt notification of loss. Failure to notify promptly — even if the claim itself is valid — can be used as grounds for reducing or denying payment.

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Your Rights Under the Insurance Business Act

The Insurance Business Act (保険業法) and its implementing regulations, as well as Cabinet Office regulations on insurance solicitation, provide policyholders with the following key rights:

• The right to receive written policy terms (保険約款) clearly explaining coverage, exclusions, and claims procedures.
• The right to file a complaint with the insurer and receive a formal response.
• The right to use the ADR mechanism (at no cost) if internal resolution fails.
• The right to file a complaint with the FSA.
• Protection against mis-selling: insurers who fail to properly explain key terms and exclusions at the time of solicitation may face regulatory sanctions, and policy terms not properly disclosed may be unenforceable.

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Step-by-Step: How to Appeal a Claim Denial in Japan

Step 1: Understand the Denial Reason

Request a written explanation from your insurer (保険会社) specifying:

• The policy clause relied upon for the denial (保険約款の条項)
• The factual basis (for example, what the alleged non-disclosure was, or why the cause of loss is classified as excluded)
• The claims handling department contact for your formal appeal

Most Japanese insurers communicate in Japanese. If you are not fluent, consider engaging a bilingual advisor or professional interpreter for critical communications.

Step 2: File an Internal Complaint (苦情申し立て)

Submit a formal written complaint to the insurer's complaints handling section (お客様相談室 or 苦情窓口). Japanese insurance companies are required by FSA regulations to have formal complaint handling procedures. Your complaint should:

• Identify your policy number and claim reference
• Explain clearly why the denial is incorrect
• Attach supporting documents (医療証明書 — medical certificates, 診断書 — diagnosis reports, 事故証明書 — accident reports, 警察証明書 — police certificates as applicable)
• Request a written response within 2–4 weeks

Step 3: Contact the Industry Association Consultation Service

Before or alongside the formal ADR process, contact the relevant industry association consultation service:

• For non-life insurance: the Japan General Insurance Association (損害保険料率算出機構 / Sonpo) consultation line at 0570-022808
• For life insurance: the Life Insurance Association of Japan consultation service at 03-3286-2648

These free consultation services provide guidance on whether your complaint has merit, how to prepare your case, and what to expect from the ADR process.

Step 4: File with the Relevant ADR Centre

If internal resolution fails, file a formal ADR application with the appropriate ADR center:

For non-life (general) insurance — Sonpo ADR Center:

• File by telephone (0570-022808) or by mail.
• Submit all documentation: denial letter, policy, internal complaint and response, supporting evidence.
• The ADR Center will facilitate mediation between you and the insurer.
• If mediation fails, an ADR decision (紛争解決結果) may be issued. The insurer is contractually bound to comply with the ADR outcome where it accepts the ADR center's jurisdiction.

For life insurance — Life Insurance ADR:

• Contact via telephone (03-3286-2648) or visit the Life Insurance Association of Japan's consultation office.
• The process is similar: mediation first, then formal dispute resolution if mediation fails.

The ADR process is free for consumers. A typical ADR case resolves within 3 to 6 months.

Step 5: FSA Complaint

If the ADR process does not resolve your dispute or if the insurer refuses to engage in good faith, file a formal complaint with the FSA Consumer Consultation Desk (金融庁相談窓口) at 0570-016811 or through the FSA website. The FSA can investigate the insurer and impose regulatory sanctions.

Step 6: Court Proceedings (裁判)

Unresolved insurance disputes may be brought before the District Court (地方裁判所). For smaller claims, the Summary Court (簡易裁判所) handles civil matters. The Small Claims (少額訴訟) procedure is available for claims of up to ¥600,000. Legal representation is advisable for larger matters.

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Earthquake Insurance in Japan: Special Rules

Japan's earthquake insurance system is unique. Earthquake insurance (地震保険) is sold as a rider to standard fire insurance (火災保険) and is co-insured by private insurers and the Japanese government. Key points:

• Damage classification is set by law: Total loss (全損), Large partial loss (大半損), Small partial loss (小半損), and Partial loss (一部損). The payout depends on classification.
• Disputes about damage classification are common, particularly after major earthquakes. Policyholders can request a reinspection if they disagree with the insurer's assessment.
• For earthquake damage classification disputes, the Sonpo ADR Center has jurisdiction.

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Common Mistakes to Avoid

Not requesting a written denial in Japanese. All formal communications with Japanese insurers and regulators must ultimately be in Japanese. Ensure you have the denial in writing in Japanese (書面による通知).

Missing the ADR filing window. ADR applications for the Sonpo ADR Center must generally be filed within 3 years of the date the dispute arose (the statute of limitations under Japanese civil law). File promptly.

Not getting medical certificates certified by a Japanese-registered doctor. For health and accident claims, the insurer typically requires certification from a Japanese-registered physician. Overseas medical documents may need translation and re-certification.

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Drafting Your Appeal Letter

Even in Japan, where formal dispute resolution is procedurally structured, the quality of your initial complaint letter to the insurer sets the tone for all subsequent proceedings. A professional, well-organized letter in clear Japanese — referencing the correct policy provisions — is far more likely to result in reconsideration at the internal stage. ClaimBack at claimback.app can help you generate a structured appeal framework in English that you or a translator can adapt into Japanese, ensuring all key arguments are included.

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Conclusion

Japan's insurance dispute resolution system — anchored by the Sonpo ADR Center, the Life Insurance ADR Centre, and the FSA — provides accessible, free, and effective channels for challenging unfair claim denials. Internal complaint, industry ADR, FSA complaint, and court proceedings form a logical escalation ladder. Use each step in sequence, maintain thorough written records, and seek bilingual professional assistance if needed. For a structured appeal letter framework, visit ClaimBack at claimback.app.