The general insurance industry in Japan is projected to grow at a compound annual growth rate (CAGR) of 3.0%, increasing from JPY12.5 trillion ($85.4 billion) in 2025 to JPY14.5 trillion ($102.6 billion) in 2030, in terms of gross written premiums (GWP), according to GlobalData, a leading data and analytics company.

According to GlobalData’s Global Insurance Database, the general insurance market in Japan is estimated to register an annual growth rate of 3.7% in 2025, driven by a recovery in the demand for motor insurance policies, elevated catastrophe losses, increased premium rates, and digitalization. Motor, property, and liability insurance combined are expected to account for 82.7% of the general insurance GWP in 2025.

Swarup Kumar Sahoo, Senior Insurance Analyst at GlobalData, comments: “Increase in premium price of motor and property insurance will be the primary growth driver in 2025. Insurance premiums have been revised five times in the past decade. Frequent occurrence of natural disasters and rising fraudulent claims are some of the factors that have led to the increase in premium rates.”

Motor insurance is the largest line of business and is expected to account for 46% of the general insurance GWP in 2025. After a decline during 2021-23, the motor insurance GWP bounced back in 2024, driven by an increase in premium prices and a recovery in motor vehicle sales. Motor insurance is expected to register a steady growth during 2025-30.

According to the General Insurance Rating Organization of Japan, motor insurance premium is expected to increase by 5% to 8% in 2025. Moreover, the introduction of the model-specific rate class system starting January 2025 will also support the growth of motor insurance during 2025-30. The new premium rate system classified vehicles into 17 classes based on the associated risk, enabling optimized pricing.

Sahoo adds: “The revised Insurance Business Act, enacted on May 30, 2025, will come into effect by the end of May 2026. This is the first major change since 2014 to address the irregularities and scandals, including fraudulent insurance claims. This change will boost consumer confidence, support business growth, and minimize losses for insurers.”

Property insurance is the second-largest line of business with an estimated 27.8% share of the general insurance GWP in 2025. Growth of property insurance is supported by an increase in premium rates and the frequent occurrence of natural disasters such as floods in Ishikawa Prefecture, a typhoon on Kyushu Island, the Noto-Peninsula earthquake, and hailstorms in Hyogo Prefecture. The General Insurance Association of Japan reported losses over $729 million due to Noto Peninsula Earthquake and $950 million due to hailstorm claims in Hyogo Prefecture in 2024.

According to the Voluntary Sale Fair Association, fire insurance premiums are expected to increase by 30-35% in 2025. Since fire insurance is mandatory in Japan for households with mortgages, the increase in premium rates will support the growth of property insurance during 2025-30.

Liability is the third-largest line of business, projected to account for 8.9% of the general insurance GWP in 2025. This line is forecast to expand at a CAGR of 4.4% during 2025-30, supported by rising incidents of ransomware and the demand for Directors’ and Officers’ liability insurance. Rising cyber threats and regulatory requirements across sectors have led to a rapid expansion of cyber insurance in Japan, with strong demand from SMEs.

Other general insurance lines, such as personal accident and health, financial lines, and marine, aviation, and transit, are estimated to account for the remaining 17.3% share of the general insurance GWP in 2025.

Sahoo concludes: “Japan’s general insurance market presents a favorable outlook supported by the high frequency of natural catastrophes, continued rate momentum in property and motor insurance, and favorable regulatory changes. The expansion in the economy, a decrease in inflation rate, and termination of the negative interest rate policy are expected to further support the growth of general insurance during 2025-30.”