A Chinese company opening a subsidiary or branch in Japan tends to ask the same first question it asks at home: which insurance is compulsory? In mainland China the answer is clear and mostly public: social insurance including work-related injury insurance (工伤保险) for every employing unit, compulsory motor liability insurance (交强险) for every vehicle, and work-safety liability insurance (安全生产责任保险) for the eight high-risk sectors. Commercial insurance beyond that is bought when a customer, a bank or a licence requires it, or when the finance department decides the risk is worth the premium. Japan's skeleton looks similar at first sight: a public work-injury scheme, compulsory motor liability, and no general mandate to buy commercial insurance. The differences are in the second layer, where Japanese landlords, customers and the Product Liability Act do the work that regulation does in China, and in the way insurance is sold and documented in Japan.
This article is written for the finance, legal and general-management staff of mainland Chinese groups and their Japanese subsidiaries. It compares what is mandatory at home with what is mandatory in Japan, explains why a head-office policy written in China cannot simply be extended to Japanese risks, translates the common Chinese product names into their closest Japanese arrangements, works through the sectors in which Chinese companies most often enter Japan, and sets out how insurance is bought and documented in Japan. It covers the mainland PRC only; Hong Kong and Macau have their own labour and insurance law and are not addressed. For the overall picture for any foreign company, see our guide to business insurance in Japan for foreign companies. Facts were checked on 28 October 2026 against the sources listed at the end; Chinese statutes are cited from official or government-hosted texts.
This article is a general explanation. It does not describe any particular insurer, product, policy or endorsement, and it is not legal or tax advice in either jurisdiction. Chinese and Japanese insurance terms are compared as "closest arrangements", not as equivalents; the terms of any policy are those of its wording.
SummaryKey points
- What is compulsory in Japan for an employer and a vehicle owner is public: workers' accident compensation insurance and employment insurance from the first employee, health insurance and employees' pension insurance for a company or branch, and compulsory automobile liability insurance (CALI) for every vehicle. Japan has no counterpart to China's work-safety liability insurance mandate for high-risk sectors.
- China's Insurance Law requires domestic legal persons that need domestic insurance to insure with insurers in China (Article 7 of the current text). Japan's Insurance Business Act applies the same principle from the other side: Article 186 restricts insurance of Japanese property and residents by a foreign insurer without a branch in Japan. A policy bought in China does not cover the Japanese entity's property, staff or liabilities in Japan.
- In Japan, the pressure to buy commercial insurance comes from contracts rather than regulation: leases require tenant's liability and contents cover, customers require products liability certificates, and the Product Liability Act makes the importer liable for defects in imported goods.
- Standard Japanese commercial fire insurance excludes earthquake; earthquake cover is added with its own limit and deductible, and the government-backed scheme is residential only.
- Insurance in Japan is sold mainly through agents acting for the insurer, in Japanese, at the insurer's rates; policies, certificates and claims are in Japanese. Plan for Japanese-language administration from the start.
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Mandatory at home, mandatory in Japan
The table sets the two statutory layers side by side. The Chinese column cites the national instruments; provincial implementing rules and sector regulators add detail that varies by region, so the Chinese side is a national-level summary.
| Area | Mainland China | Japan | What changes for the Japanese entity |
|---|---|---|---|
| Work-related injury | Work-related injury insurance (工伤保险) under the Regulation on Work-Related Injury Insurance, Article 2: every employing unit in the PRC must participate and pay contributions for all its employees. Part of social insurance, pooled regionally. | Workers' accident compensation insurance (労災保険) applies to any business employing a worker (Act, Article 3); the insurance relationship arises on the day the business starts (Collection Act, Article 3); employer pays the whole premium; administered through the Labour Standards Inspection Office. Employment insurance applies alongside. | Same public character. In Japan the employer's civil liability to the injured employee survives the statutory benefits, so a voluntary employer's top-up is common. File enrolment at the first hire. |
| Health and pension | Social insurance (basic medical, pension, unemployment, maternity) by employing unit. | Health insurance and employees' pension insurance for all incorporated entities; JETRO states that branches of overseas companies are treated as incorporated businesses and representative offices as sole-proprietor establishments. | Register the Japanese entity with the pension office; seconded Chinese staff resident in Japan are generally within the Japanese schemes, subject to any social security agreement arrangements confirmed with the authorities. |
| Motor vehicles | Compulsory traffic accident liability insurance (交强险) for every motor vehicle on PRC roads (Regulation, Article 2). | Compulsory automobile liability insurance (自賠責保険) for every vehicle (Automobile Liability Security Act, Article 5); bodily injury only, statutory limits; voluntary motor insurance adds property damage, own vehicle and unlimited bodily injury. | Register each vehicle with CALI and arrange voluntary cover; fleet rating is available for company vehicles. |
| Work-safety liability | Work-safety liability insurance (安全生产责任保险) compulsory for production and business units in the eight high-risk sectors (mining, hazardous chemicals, fireworks, transport, construction, civil explosives, metal smelting, fishery production) under the Work Safety Law, Article 51, and the Measures published on 2 April 2025; minimum per-person death and disability limit of RMB 400,000 under Article 15 of the Measures; fines for non-compliance under Article 109 of the Law. | No equivalent statutory mandate. Liability of a manufacturer, contractor or transport operator in Japan is covered, if at all, by voluntary liability insurance or by cover required under the contract for the project. | The Japanese entity in construction, chemicals, transport or metals will not be told by a regulator to buy liability cover; it will be told by its customer, its landlord or its project contract. Read those documents early. |
| Sector licences | Sector-specific requirements by regulator. | Sector licensing laws may impose insurance or security requirements for particular activities; check the licensing statute for the activity. | Confirm with the licensing authority or adviser for the Japanese activity. |
"Domestic risks, domestic insurer": China's Article 7 and Japan's Article 186
Chinese finance managers already know the principle. Article 7 of the Insurance Law of the PRC (current numbering; a 2026 draft revision would move it to Article 8 without changing its wording) provides that legal persons and other organisations within the PRC that need to obtain domestic insurance shall insure with insurance companies within the PRC, and Article 80 provides that representative offices of foreign insurance institutions may not conduct insurance business. Japan applies the same idea from the other side. Article 186 of the Insurance Business Act prohibits, in principle, a foreign insurer that has no branch in Japan from concluding insurance contracts relating to persons resident in Japan, property located in Japan, or Japanese-flag ships and aircraft; reinsurance, international transit cargo, overseas travel cover and certain marine and aviation risks are excluded; the prospective policyholder may apply for the Prime Minister's permission before concluding a contract inside the rule, and applying without permission exposes the applicant in Japan to a non-criminal fine of up to 500,000 yen (Article 337).
The practical conclusion is the one a Chinese manager would reach at home: the warehouse in Chiba, the office in Tokyo, the staff resident in Japan and the liabilities of the Japanese entity are insured with an insurer licensed in Japan. A property or liability policy bought from a Chinese insurer for the head office does not reach them. Goods in international transit between China and Japan are the main exception, because international transit cargo is excluded from Article 186, so a group cargo program commonly continues to cover shipments to the Japanese port; what happens from the port to the warehouse, and stock sitting in the warehouse, is a Japanese question. The detail is in our article on non-admitted insurance in Japan.
Chinese product names and their closest Japanese arrangements
Chinese commercial insurance has a settled vocabulary. The table gives, for each common product, the closest Japanese arrangement and the point at which the two differ. It is a translation aid, not a statement that the two products have the same terms.
| Chinese product | Closest Japanese arrangement | What is different in Japan |
|---|---|---|
| 企业财产保险 (enterprise property insurance) | Commercial fire insurance (火災保険) on buildings, equipment and stock, with extensions for wind, flood and other perils | Earthquake, eruption and tsunami are excluded as standard and added by endorsement with their own limit and deductible; flood may be sub-limited. The government-backed earthquake scheme covers residential buildings and household contents only. |
| 营业中断保险 (business interruption) | Business interruption (利益保険) and extra expense cover | Follows the property perils; earthquake interruption requires earthquake on the property side as well; indemnity period caps. |
| 公众责任保险 (public liability) | Premises (facility owner's) liability insurance (施設賠償責任保険) | Japanese liability cover is written by cause; contractual liability beyond legal liability is commonly excluded; whether the insurer negotiates with the claimant is a matter of the wording. |
| 产品责任保险 (product liability) | Products liability insurance (生産物賠償責任保険, PL) | Under Japan's Product Liability Act (Act No. 85 of 1994), Article 3, the importer of a defective product is liable in the same way as the manufacturer. A Japanese entity importing the group's products is the Japanese "manufacturer" for this purpose. Exports from Japan are covered only if extended; Japanese customers ask for certificates. |
| 货物运输保险 (cargo transport insurance) | Marine cargo insurance (貨物海上保険) for international transit; domestic transit insurance (運送保険) for movements within Japan | International transit is excluded from Article 186 and may stay on a group program; domestic transit and stock at rest in Japan are Japanese risks. |
| 雇主责任保险 (employer's liability) | Employer's top-up over the statutory scheme (業務災害補償保険 / 使用者賠償責任保険) | Sits above a public scheme that already pays statutory benefits; pays additional compensation and the employer's civil liability. |
| 董事及高级管理人员责任保险 (D&O) | Directors' and officers' liability insurance (会社役員賠償責任保険) | Directors of a Japanese company owe duties under the Companies Act; whether the parent's D&O covers subsidiary directors depends on its wording. Chinese groups that only insure listed-company directors at home should consider the Japanese directors separately. |
| 网络安全保险 (cyber) | Cyber insurance (サイバー保険) | Japanese personal-information notification obligations fall on the Japanese entity; incident response runs in Japanese; business interruption may be unavailable for some IT-service businesses. |
| 安全生产责任保险 (work-safety liability) | No direct counterpart | The Chinese product combines liability to third parties and employees with accident-prevention services under a statutory mandate. In Japan the components are separate voluntary lines (liability by cause, employer's top-up) and there is no mandate. |
What is not mandatory in Japan but your landlord, customers and banks will require
A manager used to regulation-driven purchasing should expect the demand for commercial insurance in Japan to arrive through contracts, and should read those contracts before signing rather than after.
- Office, shop, warehouse or factory lease. Japanese commercial leases commonly require the tenant to insure its contents and improvements and to carry liability cover for damage to the leased premises (借家人賠償), with the landlord insuring the structure. Landlords ask for a certificate from the insurer at hand-over.
- Japanese customers and distributors. Large Japanese buyers ask suppliers and distributors for proof of products liability insurance, sometimes naming the customer as an additional insured. For imported products this follows directly from the importer's liability under the Product Liability Act.
- Project and construction contracts. Contractors' all-risks and contractors' liability cover at the limits the contract states.
- Logistics and warehousing contracts. Allocation of risk of loss and insurance obligations for goods in third-party warehouses and in domestic transit.
- Lenders. Property insurance on financed assets with the lender's interest noted.
Two features of Japanese contract practice differ from what a Chinese group may expect. First, additional-insured status and waiver-of-subrogation clauses exist under some Japanese wordings but are not universal, and an English-language certificate for a given commercial policy is a question for the insurer; confirm before promising either. Second, Japanese counterparties generally expect a certificate from a Japanese-licensed insurer, which is a further reason the Japanese risks are placed locally.
Typical risks by sector
Manufacturing and assembly
A plant or assembly site in Japan brings property with earthquake and flood, business interruption with an indemnity period that reflects restocking from China, machinery breakdown, products liability for goods sold in Japan and exported from Japan, employer's top-up for a workforce with physical exposure, contractors' cover for installation, and cargo for inbound components. The earthquake limit is the decision most often deferred and most expensive to get wrong; standard commercial fire insurance excludes it, and the limit and deductible are negotiated when the property policy is placed. Our Japanese-language article on earthquake cover for businesses explains the mechanics.
Cross-border e-commerce, trading and warehousing
The exposures are stock in Japanese warehouses (own or third-party), domestic transit from the port to the warehouse and to customers, products liability as importer, cyber for customer data held in Japan, and premises liability for showrooms or offices. Decide who insures goods at each point in the chain, confirm what the third-party warehouse contract allocates, and remember that the group's marine cargo program usually stops at the point the international transit exclusion ends.
Restaurants, retail and hospitality
Premises liability for customers, food-poisoning liability, business interruption after fire or contamination, contents and fit-out under the lease, and employer's top-up for staff. Japanese landlords of retail premises are specific about tenant's insurance and about the certificate.
IT, games and services
Professional and IT liability for service failures, cyber for Japanese user data, D&O for the local directors, and premises cover for the office. Claims-made continuity with any parent program matters if the Japanese entity was previously covered from China.
How insurance is bought in Japan
Chinese groups are used to buying directly from large domestic insurers, through bank channels or, for larger programs, through brokers, and to negotiating price. Japan's distribution is different in three ways. Most corporate insurance is placed through agents who act for the insurer under the Insurance Business Act (Article 2(21)), may be exclusive to one insurer or represent several, and must tell the customer which insurers they can handle; the insurer is liable for the agent's conduct in solicitation (Article 283). Brokers are a separate registered category acting for the customer (Articles 286, 291 and 299), with 64 registered as of 1 September 2026. Insurers set their own rates and wordings, approved under Japanese supervision, and quote on the information submitted; the negotiation is about cover, limits, deductibles and the risk information rather than about discounts from a list price. Policies, schedules, certificates and claims correspondence are in Japanese. Plan for Japanese-language administration in the Japanese entity from the start, and ask any intermediary in which capacity it acts and, if an agent, which insurers it represents.
Underwriting a Chinese-owned entity
A Japanese insurer will ask for the same information from a Chinese-owned entity as from any other: the registration extract and corporate details of the Japanese company or branch, a description of the business in Japan and its plan, revenue and its split by location and territory of sale, headcount including staff seconded from China, a schedule of buildings, equipment and stock with values, construction and occupancy, the insurance clauses of the principal leases and contracts, any existing Japanese policies and the parent's program documents relevant to Japan, loss history, and the cover, limits, deductibles and inception date required. An outline of the parent group and its business is normally part of the submission. Which items are actually required depends on the line and the risk.
When head office runs a global program
Most Chinese entrants will find it simplest to buy the Japanese policies locally with no master above them. Larger groups that run a controlled master program will treat Japan as they treat other local-policy countries: a Japanese local policy as the foundation, the master checked for overlap and gaps, difference-in-conditions and difference-in-limits clauses responding above the local policy, financial interest cover protecting the parent's balance sheet, and, where the group wants its own carrier behind the Japanese risk, a fronting arrangement with a Japanese-licensed insurer, which is lawful in structure because reinsurance is excluded from Article 186. None of those devices replaces the Japanese local policy. Our article on global insurance programs in Japan works through the design, with a hypothetical case.
How Nayuta Insurance Technologies can help
Nayuta Insurance Technologies is a Tokyo-based insurance agency whose corporate practice, Risk & Benefits, works with foreign-owned companies on the Japanese side of their insurance. For a Chinese-owned entity we start from whatever exists: the Japanese leases and contracts, the entry plan, any Japanese policies, and the parent's policies if the group has a program. We list the exposures in Japan, separate what is statutory from what the contracts require and what is advisable, specify the Japanese cover in the terms a Japanese insurer needs (including the earthquake limit and the certificates Japanese counterparties will ask for), arrange the Japanese policies we are able to place, and manage the schedule through endorsements and renewals in Japanese. Our policy review service (Japanese) is the formal version of the first step. Communication with head office in English is supported on an email basis; we do not offer Chinese-language service.
For transparency: in non-life insurance, Nayuta Insurance Technologies acts as an agent for a specific insurer. We do not operate a model of comparing and recommending products across multiple insurers, we do not act as an insurance broker, and we do not give legal or tax advice on Chinese or Japanese law. Our policy on comparative recommendation (Japanese) sets out our position.
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Frequently asked questions
Is commercial insurance compulsory for a Chinese company's subsidiary in Japan?
Not in general. What is compulsory are public schemes: workers' accident compensation and employment insurance from the first employee, health insurance and employees' pension insurance for a company or branch, and compulsory automobile liability insurance for every vehicle. Japan has no counterpart to the work-safety liability insurance mandate for high-risk sectors. Commercial property, liability, D&O and cyber insurance are voluntary in law but are commonly required by leases, customers, project contracts and lenders.
Can our Chinese head office's property or liability policy cover the Japanese subsidiary?
Not for property in Japan or persons resident in Japan. Article 186 of Japan's Insurance Business Act restricts such contracts by a foreign insurer without a branch in Japan, in the same way that Article 7 of China's Insurance Law requires domestic risks to be insured with insurers in China. International transit cargo is excluded and may stay on a group program. The Japanese risks are insured with a Japanese-licensed insurer.
How does Japan's workers' accident compensation insurance differ from 工伤保险?
Both are public schemes funded by the employer. In Japan the scheme applies to any business employing a worker from the day the business starts and is administered through the Labour Standards Inspection Office; the employer's civil liability to an injured employee survives the statutory benefits, so Japanese employers commonly buy a voluntary top-up. Seconded staff resident in Japan are within the Japanese schemes, subject to any social security agreement arrangements confirmed with the authorities.
We import our group's products into Japan. Who is liable if a product is defective?
Under Article 3 of Japan's Product Liability Act, the importer is liable for damage caused by a defect in the same way as the manufacturer. A Japanese entity that imports the group's products therefore carries products liability in Japan and will be asked by Japanese customers for proof of products liability insurance. Decide whether exports from Japan are also to be covered.
Does Japanese fire insurance cover earthquake damage?
Not as standard. Earthquake, eruption and tsunami are excluded from standard commercial fire insurance and added by endorsement with their own limit and deductible. The government-backed earthquake insurance scheme covers only residential buildings and household contents. Decide the earthquake limit explicitly when the property policy is placed.
Can we handle the Japanese insurance in Chinese or English?
Policies, certificates and claims in Japan are in Japanese, and most intermediaries work in Japanese. Whether an English-language certificate is available for a given policy is a question for the insurer. Plan for Japanese-language administration in the Japanese entity, and ask the intermediary what language support it offers.
Primary sources
- State Council Decree No. 586, Decision on amending the Regulation on Work-Related Injury Insurance (Article 2: scope of participating units) (Chinese)
- Ministry of Emergency Management of the PRC and six other departments, Measures for the Implementation of Work Safety Liability Insurance, 2 April 2025 (Articles 2, 15 and 48) (Chinese)
- Work Safety Law of the PRC, 2021 revision, Articles 51 and 109 (text as republished; verify against the national database before relying on it) (Chinese, PDF)
- Insurance Law of the PRC (2015 revision), Articles 7 and 80 (Chinese)
- Regulation on Compulsory Traffic Accident Liability Insurance for Motor Vehicles, Article 2 (Chinese)
- Insurance Business Act (Act No. 105 of 1995), Articles 2, 186, 283, 286, 299 and 337 (Japanese)
- Product Liability Act (Act No. 85 of 1994), Article 3 (liability of manufacturers, processors and importers) (Japanese)
- Workers' Accident Compensation Insurance Act, Article 3 (Japanese)
- Act on Collection of Labour Insurance Premiums, Article 3 (Japanese)
- Ministry of Health, Labour and Welfare, workers' accident compensation (scope of application) (Japanese)
- JETRO, Setting Up Business in Japan, 4.9 Japan's social security system (English)
- Automobile Liability Security Act, Article 5 (Japanese)
- Earthquake Insurance Act, Article 2 (Japanese)
- Ministry of Finance, explanatory material on the earthquake insurance system (Japanese, PDF)
- Financial Services Agency, lists of licensed non-life insurers and registered brokers (Japanese)
- Business Insurance in Japan: A Guide for Foreign Companies (Nayuta Insurance Technologies)
- Non-Admitted Insurance in Japan (Nayuta Insurance Technologies)
- Global Insurance Programs in Japan (Nayuta Insurance Technologies)
- Japanese version of this article: 中国系企業の日本法人の損害保険
This article is a general explanation of business insurance in Japan for companies headquartered in mainland China. It is not legal, tax or regulatory advice in either jurisdiction, and it does not describe or promote any particular insurer, product, policy or endorsement; Chinese and Japanese products are compared as closest arrangements, not equivalents. Hong Kong and Macau are separate jurisdictions and are not covered. Whether a claim is paid is determined by the insurer under the specific policy wording and facts. In non-life insurance, Nayuta Insurance Technologies acts as an agent for a specific insurer; see our policy on comparative recommendation.