TOKYO -- Nippon Life Insurance plans to purchase insurance brokerage Hoken-no 110 Ban, expanding its store network in hopes of more effectively marketing to hard-to-reach younger people.
The acquisition is expected to cost billions of yen, or tens of millions of dollars. Nippon Life is nearing an agreement to purchase all shares from the founders.
Hoken-no 110 Ban has about 90 locations throughout Japan, anchored in the Kyushu area. It ranks sixth in brokerage fee revenue, pulling in around 5 billion yen ($44.4 million) a year.
Industry leaders are moving fast to broaden sales channels through acquisitions and partnerships. Nippon Life gained roughly 50 locations with its 2015 purchase of the LifeSalon brokerage for around 1 billion yen. With the latest purchase, Nippon Life will have nearly tripled the number of stores. The hope is that having even more will help Nippon Life provide offerings that appeal to young customers by allowing the company to quickly grasp market trends.
This comes at a time when Nippon Life is finding it harder to reach young customers through its traditional sales representatives. While half of the customers who visit insurance brokerages are in their 20s and 30s, banks and insurance brokerages supply just about 10% of Nippon Life's total sales.
Even after the purchase, Hoken-no 110 Ban locations will continue to handle products from multiple insurers.
Nippon Life is also partnering with mobile carrier NTT Docomo in an effort to recommend insurance products to young people at Docomo Shop stores.