lifestyle

Car insurance in Japan

4 Comments
By Steve Burson for BCCJ ACUMEN

Although the basic idea of car insurance in Japan will seem familiar to foreigners, car insurance here is very different from that in other countries.

To determine how much you pay for insurance, there is a system of numbered levels, between one and 20; most people start at level six. Filing a claim may cause your points to drop below six, which will be more expensive.

From level three down, coverage becomes hard to find or very expensive, while rising to a higher level will significantly lower your rates.

Choosing the right insurance depends on your circumstances, including age, driving record, type of car and how often it is driven.

However, the key to choosing the right insurance is to understand the options available, so you can get what you really need.

Low-cost insurance providers offer online applications and generic policies that may suit your needs—if you know what you are doing and feel comfortable using Japanese.

The insurer must understand properly your needs, and the extent to which each policy is able to meet them. This requires a level of English ability that has been missing from the Japanese insurance market and, thus, has put some consumers at risk.

Prospective customers should learn about the system before buying motor insurance, not after.

Basic insurance is placed on a vehicle when it is first registered, and additional levels of insurance can then be added for extra protection.

The most common mistake foreign consumers make is to have insufficient insurance coverage. Accidents here are almost never found to have been entirely the fault of one party, unless one car was stationary.

Using one’s insurance to cover small bumps and slight damage to a car ultimately raises the premium and lowers the point level within the system.

Reporting too many incidents may result in significantly higher rates, making the consumer uninsurable in some cases. Thus, paying out of one’s own pocket to maintain a good insurance record is sometimes a good idea.

Used vehicles should not necessarily be insured for the full cost of replacement, since almost no value remains once a car is older than about six years. Insuring such a vehicle for the replacement value often will mean you are paying premiums that are much too high.

© Japan Today

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4 Comments
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What did I just read? Do I take it the author has some issues regarding auto insurance in Japan?

1 ( +1 / -0 )

Accidents here are almost never found to have been entirely the fault of one party, unless one car was stationary.

Cripes then I must be in the almost never category along with a number of Japanese friends of mine who were found to be 100% at fault during minor fender benders.

Cops just write up the report and the insurance companies decide how to deal with it.

Used vehicles should not necessarily be insured for the full cost of replacement, since almost no value remains once a car is older than about six years.

Another downright fallacy unless you consider 1,000,000 yen to be "no value". I lost a car during a typhoon, got flooded and to replace the engine, electrical, everything, would have cost more than a new car. My car was valued out at a bit under 1 million yen and I received the value plus 10% due to the loss being from a natural disaster.

Nice thing to have on the insurance! Insurance rates did not go up, nor did my "points" (toukyu) go down either, I currently sit at 19!

1 ( +1 / -0 )

You shouldn't drive without extra car insurance in Japan. The price of human life is very expensive. Keep being a safety driver, of course me too.

1 ( +1 / -0 )

If both cars are moving and one of you is not doing an illegal act, then it should never be 100 / 0 (one persons fault). If you are getting 100%, then you should probably change insurance companies or ask them to fight harder for you.

0 ( +0 / -0 )

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