After 56 years, the Japanese Insurance Business Law was revised in 1997. The purpose of the newly revised law is competition, to protect policy holders, and to promote greater management efficiency. The law allowed, for the first time, cross entries of life and nonlife companies into each other's sector through the establishment of subsidiary companies. In response to this development, six life and eleven nonlife insurance companies set up subsidiaries. Firms may not engage in life and nonlife insurance at the same time. In 2000, leading Japanese nonlife insurance firms included Tokio, Yasuda, Mitsui, Sumitomo, Nippon, Dai-Tokyo, Nichido, and Chiyoda. Leading life insurance companies included Nippon, Cai-Ichi, Sumitomo, Meiji, Yasuda, and Asahi. Direct premiums written in 2001 totaled US $445.845 billion.
Life insurance is by far the most extensive of all classes of insurance; premium income is more than three times that of all nonlife premium income. In 2001, life insurance premiums written totaled US $356.731 billion, while nonlife insurance premiums totaled US $89.114 billion. Japan is the world's largest holder of life and health insurance. More than 90% of the population owns life insurance, and the amount held per person is at least 50% greater than in the United States. Nippon Life Insurance Co., the world's largest insurance firm, had US $46.6 billion in gross premiums written in 2001.
In the nonlife field, automobile insurance is the largest sector. (Automobile liability insurance is compulsory.) Personal accident insurance was next in importance, followed by fire, marine cargo, and marine hull insurance.
In the mid-1990s the combined Japanese life and nonlife insurance market had the world's largest share with 30.8% of the world total premium. The life insurance market was 42.6% of the world market, and the nonlife market with 15.2%, the second-largest in the world after the United States. The Japanese nonlife insurance market consisted of 29 domestic companies and the life insurance market consisted of 36 domestic companies in 1997.