Sompo Japan president steps down over Bigmotor insurance fraud scandal
Sompo Japan president steps down over Bigmotor insurance fraud scandal | Insurance Business Asia
Insurance News
Sompo Japan president steps down over Bigmotor insurance fraud scandal
Announcement follows news the major car dealership’s founder was forced to resign
Insurance News
By
Jonalyn Cueto
Sompo Japan Insurance president Giichi Shirakawa will step down from his post, taking responsibility for the handling of allegedly fraudulent insurance claims by Bigmotor, a major car dealership and repair chain.
Sompo Holdings and Sompo Japan held a news conference on Friday to discuss the latest findings on Sompo Japan’s relationship with Bigmotor. The car dealer has come under scrutiny with allegations it was found to have charged excessive repair fees after intentionally damaging cars and to have made fraudulent insurance claims.
A Nikkei Asia report said the insurer has been criticized for resuming transactions with Bigmotor last year despite being aware of the possibility of fraudulent insurance claims. At a July 2022 board meeting, Sompo Japan discussed whether to restart transactions with Bigmotor, and Shirakawa pushed for resumption even though he recognized that the allegations of fraud were strong.
“We decided to resume business with Bigmotor on the condition that they implement measures to prevent a recurrence,” Shirakawa said. “It was a rash decision that I deeply regret.”
“We sincerely apologize for any inconvenience and concern this has caused,” said Kengo Sakurada, chairman of Sompo Holdings.
Shirakawa was appointed as president of Sompo Japan in April 2022, and at his age then, he was considered the youngest head of a major financial institution in Japan.
In July, Hiroyuki Kaneshige, the founder and then president of Bigmotor, was forced to resign amid outrage among customers.
The Financial Services Agency is investigating the matter and will conduct an on-site inspection at the insurer later this month.
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