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Japan - Open Market Model

The Open Market Model provides simpler arrangements for underwriting Japan risks controlled from outside Japan and for issuing local Japan policies.

Lloyd’s underwriters are currently permitted to underwrite risks located in Japan on a direct basis in a number of classes (listed in Appendix 1). In accordance with Japanese regulations, all direct risks (other than aircraft, marine and travel packages) require a local policy to be issued and require premium to be received before inception. For Lloyd’s market participants, policy issuance can be arranged through Lloyd’s Japan Inc. (LJI), a wholly owned subsidiary of Lloyd’s, which acts as a local Coverholder for managing agents.

Lloyd’s underwriters who do not issue a local policy through LJI will require a local fronting arrangement.

For managing agents wishing to underwrite risks which are located in Japan but controlled outside Japan as being part of a global programme, the arrangements set out in this note establish a simplified process via LJI to issue local policies compliant with Japanese regulations - the Open Market Model (OMM). This is designed for the placements where the Japanese section of the risk forms parts of a multi-territory programme.

The arrangements outlined in this guidance note can be used for all Japan domestic risks, which:

  • Are a part of a global policy not issued in Japan; and
  • Are Japan risks controlled outside Japan (see below); and
  • Are within one of the classes noted as “available for open market model” in Appendix 1 and the products licensed in Japan by LJI.

To qualify as a “Japan risk controlled from outside Japan” both of the following conditions must apply:

1. The head office or ownership of the Japan entity/risk is outside of Japan; and

2. The insurance purchase decision is taken outside of Japan.

Note that this arrangement may only be utilised by the Lloyd’s syndicates participating on the risk. LJI cannot issue a local Japan policy on behalf of non-Lloyd’s markets.


For all comments and questions, please contact:

Mineyuki Yokota

Underwriting Service Director, Japan Underwriting Services Team Lloyd's Japan

+81 (0)3 4520 6781