When a foreigner purchases a car in Japan, the first concern is automobile insurance. There are certain requirements for foreigners to purchase Japanese automobile insurance, and if they do not meet the requirements, they will not be able to purchase it. This article will explain in detail the structure of automobile insurance in Japan, the conditions for enrollment, and recommended automobile insurance for foreigners.

How does automobile insurance work in Japan?
Compulsory Automobile Liability Insurance and Voluntary Insurance

There are 2 types of automobile insurance in Japan: compulsory automobile liability insurance, which is compulsory when you purchase a car, and voluntary insurance, which you purchase voluntarily. Generally, the term “automobile insurance” refers to voluntary insurance. Since liability insurance only covers compensation in the event of bodily injury, death of the other party, or severe permanent disability, it is recommended that you also have voluntary insurance. Voluntary insurance is available not only for the victim of the accident, but also for you, your passengers, the other party’s car, and your own car in the event of damage. Some insurance companies also offer a full range of road services, which can help you in the event of sudden breakdowns such as a flat tire or a dead battery. If you want to drive a car with peace of mind in Japan, it is recommended that you also purchase voluntary insurance.

What are the conditions for foreigners to purchase Japanese automobile insurance?

The following are the requirements for foreigners to purchase Japanese automobile insurance and the documents for enrollment.

①     Possession of a valid driver’s license.

Foreigners must have a valid driver’s license in Japan to purchase automobile insurance.

*A valid driver’s license in Japan is one of the following 3 types

l   A Japanese driver’s license obtained while living in Japan

l   An international driver’s license issued by a Geneva Convention member country within 1 year of issuance (excluding Taiwan, Switzerland, Germany, France, Belgium, Slovenia and Monaco)

l   A driver’s license from your own country that has been converted to a Japanese driver’s license

*An international driver’s license has a one-year expiration date after it is issued, so if 1 year has passed since your entry into Japan, you will need to convert it to a Japanese driver’s license. The changeover to a Japanese driver’s license is called a Gaimen-Kirikae, and can be done at a local police station or driver’s license center after staying in Japan for at least 3 months and registering as a resident. Please note that international driver’s licenses issued in countries that are members of the Vienna Convention, not the Geneva Convention, cannot be used.

②     Must be able to provide all necessary documents to join the insurance

The documents vary in accordance with an insurance company, so please research and prepare them carefully before applying for the insurance.

③     Ability to understand Japanese to some extent

When purchasing automobile insurance, it is necessary to understand to some extent the content of Japanese-language application documents, policy clauses, and important information manuals. Even if an insurance company handles accidents in a foreign language, the documents are often written only in Japanese, so it is essential to be able to understand Japanese as a general requirement for purchasing automobile insurance. Specifically, it is useful to have the ability to read sentences mixed with Kanji characters.

Required documents for purchasing insurance

The following 3 documents are basically required for foreigners to purchasing automobile insurance in Japan.

l   Vehicle registration certificate

l   Valid driver’s license

l   Residence card (special permanent resident certificate)

In addition to this, if you already have automobile insurance and are considering reviewing it, you will need your automobile insurance policy. Some insurance companies may also require that you have a Japanese bank account for payment of premiums. If having a Japanese bank account is a requirement, you will also need to provide documentation to prove it.

How to choose automobile insurance for foreigners

Basically, it is possible for foreigners to purchase Japanese automobile insurance. However, since the coverage and premiums for automobile insurance vary completely from company to company, it is important to carefully compare the contents of each insurance company and choose the best one to suits your needs. In particular, foreigners should pay attention to the following points when selecting an insurance company.

1.      Do you meet the requirements for membership?

The requirements for foreigners to purchase automobile insurance differ from one insurance company to another. You must meet the requirements set by the insurance company to be eligible for the insurance, so please check carefully whether you meet the requirements before applying for the insurance.

2.      Are foreign languages supported?

Some insurance companies offer accident services in foreign languages. In the event of an accident and in a panic, having the response in your own language will give you a sense of security. If you are not confident in your Japanese or even if you are fluent in Japanese, it is important to check if the accident is handled in a foreign language.

3.      Is it possible to cancel during the term?

Most automobile insurance policies have a contract term of 1 year. However, those who need to return to their home country during the contract period must cancel during the contract period. Each insurance company has different cancellation refund, penalty fee, and period of acceptance for mid-cancellation, so please check carefully if you need to cancel during the policy period.

Recommended automobile insurance for foreigners

We have carefully selected 3 automobile insurance policies recommended for foreigners based on the following criteria: multilingual accident response service, speedy and courteous accident response, low premiums, and being operated by a large and well-known Japanese company. *Please note that information on coverage and service bases introduced in this article may be subject to change, so please be sure to check the official website or other information.

Sony Assurance Inc.

Sony Assurance offers a full range of accident response services in foreign languages, with support for 18 languages including English, Chinese, and Korean. Accident response is available 24 hours a day, 365 days a year, and one person and support team are assigned to each accident, ensuring speedy and courteous response. There are approximately 10,000 service locations nationwide to handle various types of car troubles. Insurance premiums vary depending on the mileage, so it is recommended for those who do not drive much on a regular basis. In addition, after the 2nd year of the policy, there is a preferential service that offers discounts at accommodations, leisure facilities, movie theaters, etc.

Mitsui Direct General Insurance Company, Limited

Mitsui Direct General Insurance offers accident response services in 17 languages including English, Chinese, and Korean. Accident response is available 24 hours a day, 365 days a year, and one person is assigned to each accident, providing peace of mind. The company has approximately 4,300 service locations nationwide, but it is nice to know that towing to a designated repair shop is free of charge with no distance limitation. In addition, Mitsui Direct General Insurance has a reputation for low insurance premiums and offers a wide range of discounts, including Internet discounts, so it is ideal for customers who want to reduce their insurance premiums as much as possible.

E.design Insurance Co., Ltd.

E. design Insurance offers accident response services in 15 languages including English, Chinese, and Korean. Accident response is available 24 hours a day, and is handled in cooperation with dedicated personnel and the Tokyo Marine Group’s highly specialized staff. There are 8,100 service locations nationwide, and towing to the nearest designated factory is free of charge with no distance limit. Insurance premiums are calculated based on the distance driven, and are therefore recommended for those who do not drive much. In addition, if you have been accident-free for 1 year, you can receive a discount on the premium for the following year, including the “accident-free discount”, which is also available as a discount service here.

Check whether foreign language support is available!

Up to this point, we have provided information on the requirements for foreigners to purchase Japanese automobile insurance, required documents, and points to consider when choosing automobile insurance, as well as 3 insurance recommendations.

When choosing a Japanese automobile insurance policy for foreigners, we recommend that you focus on whether or not the accident response is available in your own language. At the time of an accident, you may be in a hurry or in a panic, and it may be difficult to speak Japanese. Therefore, being able to get assistance in your native language is a more reassuring factor than you might think. If you can find automobile insurance that is available in the language of your country, then compare coverage and premiums. I hope this article will help you choose the right auto insurance company.