Insurance plays a vital role in our everyday lives, securing us financially against the unknown and providing peace of mind in case the unexpected were to happen. In Japan, there are two types of property insurance: Kasai-Hoken 火災保険 (Fire Insurance), which covers a range of risks beyond fire, and Jishin-Hoken 地震保険 (Earthquake Insurance), which is particularly significant in Japan due to its vulnerability to natural disasters.

The Kasai-Hoken 火災保険

Kasai-Hoken (Fire Insurance) refers to general property insurance that covers the structure of a home from fires, explosions, snow damage, and theft. Please note that earthquakes are not included in this policy. Kasai-Hoken is highly recommended in Japan due to its densely populated urban areas and wooden structures, which increase the risk of fire-related emergencies.

This insurance not only covers the actual building but also the contents of the property, including belongings, electronics, and even furniture. The premium cost varies depending on factors such as property type, size, age, and location. Location is particularly important because there may already be some safety prevention measures in place. Kasai-Hoken is mandatory for mortgage holders, as mortgage lenders require borrowers to have it when purchasing property, making it a condition of the loan.

The Jishin-Hoken 地震保険

Japan is renowned for its natural disasters, with the 2011 earthquake and tsunami in Tohoku reaching a magnitude of 9.1. This emphasizes the importance of Jishin-Hoken insurance, which aims to protect property owners and renters from significant financial losses in the worst-case scenario.

Jishin-Hoken (Earthquake insurance) covers structural damage to buildings, building contents, and extra living expenses in case the property becomes uninhabitable. Interestingly, the Japanese government partially subsidizes Jishin-Hoken to make it more affordable, providing further encouragement for residents. Similarly, to Kasai-Hoken, the cost of the Jishin-Hoken premium largely depends on factors such as location, structure, and seismic risk, usually calculated based on the building’s assessed value.

Why Are These Insurances Important?

Due to Japan’s geographical location, natural disasters such as earthquakes, tsunamis, and fires are inevitable. While periods of time can pass without natural disasters, that doesn’t mean that one isn’t lurking around the corner, which is why Kasai-Hoken and Jishin-Hoken are there to protect you during uncertain times. Japan is highly vulnerable in this regard, and residents are strongly encouraged to protect themselves just in case.

 

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