Around the World: Japanese insurer grows and thrives online

Lifenet also used some interesting techniques to raise awareness of its brand within its target market. First came television advertisements and strategically placed print ads in Tokyo’s crowded subway stations, along with the continual optimisation of online ads. From there Lifenet moved to raising and optimising its profile on Facebook, Twitter, and other social media outlets.

The company hosts a well-read, informative blog that is populated by more than one-third of its employees. Deguchi also gives lectures or speeches about 20 times per month, which has earned him many Twitter followers.

Very recently, one of Japan’s largest ebook stores began giving its customers free coupons redeemable for a Manga (comic book) about the history of Lifenet. Could this technique work in other parts of the world?

50,000 customers

This strategy has enabled Lifenet to grow quickly. Two years after its 2008 launch, it had already achieved more than 50,000 customers, and by the end of November 2012, had more than 150,000 customers.

The company is continuing to grow quickly: many of its current customers are in the coveted 39-and-under age bracket (50% first-time buyers), which will almost certainly lead to repeat sales.

In addition, in March 2012 Lifenet became a member of the Tokyo Stock Exchange’s Mothers section (the market for stocks of high-growth startup companies), which has provided the company with improved access to capital to fund its rapid growth.

A recent survey of more than 12,000 internet customers found Lifenet’s approval rating to be the second best in Japan’s entire life insurance industry. As Lifenet’s name recognition continues to grow, competitors must be worried.

Did Lifenet meet its goal of having products that represent good value? One way to analyse this is to look at premiums charged on a ¥10m (£70,000) face amount, 30-year term product sold to a 30-year-old standard male.

Lifenet charges roughly ¥2,600 (£18) per month for the life of the policy. Lifenet’s traditional competitors are charging closer to ¥4,000 (£28) per month for the same term life cover.

Lifenet achieved its growth by successfully challenging one of the life insurance industry’s fundamental core beliefs: “Life insurance is sold, not bought”. It is also finding success in selling LTD products online – a feat few (if any) insurers in the world have been able to accomplish.

Maybe more important, Lifenet has found a different approach, that appeals directly to the under-served market without high advertising costs. Could the UK be tempted to move away from the current norms?  

Greg Goodfliesh is vice-president of RGA Japan