Australia’s No.1 life insurer turns digital pioneer for Japanese parent

With a mature home market, Japan’s life insurance companies are keen investors in Australia’s large and evolving life insurance industry. Leader in the field is Japan’s third biggest life insurance company, Dai-ichi Life, which bought trans-Tasman TAL in 2011. Since 2011, Dai-ichi Life has invested several hundred million dollars in its Australian business.

One of Japan’s largest overseas insurance investments

First to benefit are TAL customers. TAL has led the Australian insurance industry in using digital to innovate the customer experience and the developments pioneered in Australia bring learnings to Dai-ichi Life for both their Japanese business and emerging markets. Mutual commitment to corporate philanthropy also benefits Australian communities, with TAL helping the Royal Flying Doctor Service bring preventative health services to remote communities.

With compulsory retirement savings and a long history of life insurance, Australia has one of the world’s five largest wealth management sectors. According to the Reserve Bank of Australia, total assets under management are valued at approximately A$2.72 trillion, which is 160 per cent of Australia’s annual gross domestic product.

In recent years, the comparatively large size of Australia’s life insurance industry has gained attention in Japan. This is partly because of the maturity of the Japanese market. It is also a testament to the vitality of Australian life insurers that have contributed ideas and innovation to an industry that – globally at least – has a reputation for being slow to change.

One company that’s made the transition to Japanese ownership is trans-Tasman icon, TAL. Founded in New Zealand over 140 years ago, TAL has grown to pre-eminence in the Australian–New Zealand life insurance industry. Today the company insures almost 4 million Australians, and provided A$1.4 billion in claims to over 23,000 Australians and their families in 2017.

Japanese life insurer, Dai-ichi Life, purchased TAL in 2011. At the time, the deal ranked as the third biggest acquisition by a Japanese insurance company and the first major purchase of an Australian life insurer by a Japanese company. Since then, Dai-ichi Life has invested a further several hundred million dollars in TAL.

Australia pioneers digital for Japan customers

One focus area for investment is digital. Since 2011, TAL has established itself as an industry leader in using digital to improve the customer experience. For example, in 2013 TAL purchased the online comparison business, LifeBroker, which enables consumers to compare life insurance policies from a range of providers in Australia. With Dai-ichi Life backing, TAL continues to add functionality to the site to improve the comparison experience for the growing number of self-directed consumers, even though the site promotes and lists competing insurers, such as AIA, AMP and Zurich.

Dai-ichi Life has closely monitored TAL’s digital progress, specifically the innovations that have enabled TAL to proactively reach out to potential customers. This includes TAL’s CoverBuilder innovation, which enables self-directed consumers to build their own fully underwritten cover online. As a result, TAL has taken on the role of digital pioneer.

Founded in 1902, Dai-ichi Life was Japan’s first mutual insurance company, and is now one of the biggest. In 2016, Dai-ichi Life had assets of A$578 billion and annual revenues of A$85 billion. The company’s 2011 purchase of TAL was the first in a series of acquisitions by Japanese life insurers, with Nippon Life acquiring 80 per cent of MLC in 2015, and Sony Life purchasing 15 per cent of Clearview in the following year.

One factor that binds Dai-ichi Life and TAL is an exemplary approach to corporate social responsibility (CSR). For example, after the catastrophic Tōhoku earthquake that hit Japan in March 2011, Dai-ichi Life employees immediately began scouring evacuation centres to find policyholders and ensure they received payments as fast as possible.

In Australia, Dai-ichi Life has embraced TAL’s proud tradition of community fundraising and health improvement campaigns. ‘We have a strong desire to contribute to the Australian community that goes beyond providing life insurance,’ says Fiona Macgregor, Chief Customer & Innovation Officer at TAL. ‘In 2016, almost 20 per cent of TAL employees participated in TAL community foundation activities, and we donated more than A$350,000 to 21 different charities and community groups.’

Partnership with the Royal Flying Doctor Service

As a life insurance company, TAL’s community focus is aligned to its purpose of helping Australians live a life filled with choices, options and freedoms, no matter what happens. TAL officially partners with the Royal Flying Doctor Service (RFDS) to enhance health education programs in rural and remote parts of Australia. In particular, TAL and RFDS intend to join forces to prevent “Australia’s cancer”, melanoma, leveraging TAL’s “SpotChecker”. Pioneered on Bondi Beach in Sydney, TAL’s free SpotChecker involves professional medics providing on-the-spot checks.

TAL is also helping RFDS to develop its own brand awareness in major Australian cities, where younger people are less familiar with the work it does.

Other CSR programs focus on skills transfers between TAL employees and disadvantaged communities. TAL partners with the Australian Business and Community Network in a mentoring program that helps children from disadvantaged backgrounds to gain skills and work experience that enhance vocational choices. TAL is also working with the Jawun not-for-profit organisation by providing skilled secondees to work in Indigenous communities.