Sompo Holdings & Bigmotor

Sompo Holdings' Kengo Sakurada is planning to step down as CEO at the end of March, over automobile insurance fraud at used-car dealer Bigmotor. The Financial Services Agency is expected to issue business improvement orders to the holding company and subsidiary Sompo Japan Insurance as soon regarding their responses to wrongdoing by Bigmotor. The FSA ended its on-site inspections of Sompo Holdings and Sompo Japan.

The orders will likely urge the two companies to clarify their management responsibility over the matter. The parent company will consider whether Sakurada, 67, should also quit as its chairman, based on the upcoming FSA actions.

Bigmotor Misconduct - Sompo Japan was the only firm among major nonlife insurers to resume referring its auto insurance customers to Bigmotor even though it was aware of the used car dealer's misconduct. Sompo Japan later notified Sompo Holdings of the resumption.

An independent investigation panel set up by Sompo Holdings has criticized Sompo Japan's decision on resuming introductions of customers to Bigmotor as "lacking customer-oriented thinking." Sompo Holdings did not take any proactive measures and failed to properly instruct the unit to deal with the matter, the panel also said, pointing to flaws in the parent company's supervisory system.

Sakurada joined Yasuda Fire & Marine Insurance, now Sompo Japan, in 1978. He assumed his current positions in April 2022 after serving in posts such as president of NKSJ Holdings, now Sompo Holdings. Sakurada was chairman of the Japan Association of Corporate Executives, or Keizai Doyukai, from April 2019 to April 2023.