With Japan facing an aging population and growing life expectancy, Meiji Yasuda Life Insurance Co. last month introduced the first healthcare insurance plan that allows for the enrollment of customers up to 90 years of age.
The insurance company's plans to date had an upper age limit of 80 for entry, but the new plan is available for those aged 50 to 90 -- the very first of its kind. The insurance industry has long targeted working-age customers, but as customers face a "longevity risk" resulting in them not being able to pay their medical fees, the industry is on the verge of a shift in the types of plans it offers.
Customers enrolled in Meiji Yasuda's new plan can receive up to 100,000 yen per hospitalization and 50,000 yen per surgical operation. If customers choose a special provision adding roughly 100 to 500 yen to their monthly bill, then they are eligible to receive a total of up to 20 million yen to cover "advanced medical care" that is not covered by national public health insurance, such as the latest cataract surgery. Customers pay insurance premiums until 95. If, for example, a woman was 60 years old at the time of enrollment, her monthly payment would come to 8,220 yen, while a man enrolling at 90 would pay a monthly premium of 24,880 yen.
The shift in the insurance market in raising the age for eligible enrollment appears to be spurred by the growing need for medical insurance among the elderly. The life expectancy for Japanese people has been rising each year, and it is estimated that by 2049, the population of centenarians will surpass 500,000.
"The proportion of elderly people enrolling in medical insurance is expected to grow," said a representative from Meiji Yasuda.
The shift from "mortality" insurance to "longevity" insurance is also taking place at other insurance firms as well. In August 2013, insurance giant Aflac Japan extended the age of enrollment for lifetime healthcare insurance from 80 to 85.
Companies like Neo First Life Insurance Co., which operates under the Dai-ichi Life Group, and Medicare Life Insurance Co. under the Sumitomo Life Group umbrella, have also extended the enrollment age to 85, with a rough annual total of 9,000 new customers over the age of 80.
Another product attracting attention is the "tontine pension" plan. Under this plan, members pay into a fund, and in exchange for suffering a financial loss if one dies earlier, the amount of payments out of the fund provides extra benefits for those who live a long time. Nippon Life Insurance Co., Dai-ichi Life Insurance Co. and other insurers began selling the plans in 2016, and the number of contracts for the plan has since grown to a total of over 50,000.
"Insurance plans that allow for the elderly to live their lives to the fullest are becoming more and more important," said the Meiji Yasuda representative.