A Case Study on Demutualized Life Insurers in Japan : From Viewpoint of Comparison between Mutual versus Stock Ownership

Why there have been no such trends for demutualization as seen in the foreign countries?Mutual companies in Japan are very unique historically and internationally.Small number of mutual companies has dominated the industry for nearly 50 years.Life insurers newly founded are all stock companies, which suggest that stock companies are more desirable than mutual companies.At present only five mutual companies remain and their proportion of premium is 39.6% percent.The hypothetical answers to the question are that they are no different than stock companies as a matter of fact and that they are too large to demutualize.This paper will examine any ef fect of demutualization by reviewing a sequence of management indexes of five demutualized life insurers in Japan.It is the conclusion that the demutualization did not so much contribute to the value maximization of the company and that a remaining mutual company will have no reason to go through labor and expenses of demutualization unless they have some special reason to do that.