The Prudential investigation report on Inappropriate Monetary Conduct by current and former sales employees is described in an announcement from Prudential Life Insurance Co., Ltd. in Japan, which relays the findings of a Special Investigation Committee. The announcement and a companion update also address disciplinary measures, the state of customer reimbursements and the reforms the company says it will carry out.
Committee Findings on the Sales Model and Governance
In its announcement, the company states its own position on the Inappropriate Monetary Conduct that the committee examined. The company says it recognizes that the Inappropriate Monetary Conduct was not limited to issues involving individual sales employees, but was a structural problem arising from its management framework and business model. InsuraBeat uses the term found in the documents, Inappropriate Monetary Conduct, throughout this article.
The announcement then reports the assessment of the Special Investigation Committee, and it attributes the following conclusion to that committee. The committee assessed that the issues were not isolated instances of misconduct by certain sales employees or at certain sales locations, but rather structural problems resulting from the interplay among the business model, systems, organizational culture, sales management framework, head office functions, and governance.
On visibility into sales activity, the announcement relays the committee’s finding in these terms. The committee found that the highly individualized and closed nature of relationships between sales employees and customers made it difficult for sales managers and head office to gain sufficient visibility into actual sales activities.
On risk information, the announcement reports a further finding, and it says that the committee found that the Company lacked sufficient mechanisms to aggregate and analyze risk information across the organization, including complaints, whistleblower reports, misconduct cases, and internal audit findings. On earlier cases, the committee’s statement is that the Company’s responses remained limited to case-by-case measures and partial strengthening of controls and did not lead to fundamental reform.
Disciplinary Measures Against Sales Employees
The announcement reports the disciplinary measures that the company took against sales employees. After a further review of the cases announced by the Company on January 16, 2026, the Company determined that a total of 146 current and former sales employees had been involved in Inappropriate Monetary Conduct.
The announcement then breaks that group down by the type of measure. Within that group, 53 were subject to disciplinary dismissal or resignation under instruction, 68 to suspension from duty, and 25 to other disciplinary measures, including admonitions and reprimands. On timing, the announcement states that disciplinary action against those individuals was completed by April 2026.
Customer Reimbursement Progress
In its reimbursement update, which carries the names of Prudential Holdings of Japan, Inc., Prudential Life Insurance Co., Ltd. and Gibraltar Life Insurance Co., Ltd., the three companies report on the individuals concerned by the earlier announcement. The update gives the position at the date it states, and the numbers are the companies’ own. For the 498 individuals, representing claims in the aggregate amount of 3.08 billion yen, announced on January 16, the update says that review or reimbursement has been completed for 492 individuals. A further 6 individuals, representing claims in the aggregate amount of 3 million yen, remain under review or are awaiting resolution.
The update also reports on a separate set of inquiries, and it names the entities to which they relate. The announcement says that Prudential Holdings of Japan (hereinafter, the “Holding Company”) has established the Customer Reimbursement Committee, composed of third parties and operating independently from the Prudential Group. The review figures that follow are reported by “the Committee” in the update. As of September 16, the Committee has completed the review of 848 inquiries, 725 relating to Prudential Life and 123 relating to Gibraltar Life. Of those, 329 were eligible for reimbursement, representing claims in the aggregate amount of 2.57 billion yen.
The update goes on to describe the conduct behind the eligible cases and the inquiries the update calls unsubstantiated. According to the update, the primary types of conduct in cases eligible for reimbursement were money borrowing, investment solicitation, or investment referral. Another 519 inquiries were unsubstantiated, 453 relating to Prudential Life and 66 relating to Gibraltar Life. InsuraBeat has separate coverage of Prudential Life’s earlier customer compensation reserve and the FSA’s widening probe.
Reforms the Company Describes
In the same announcement, the company describes reforms to pay, to the agency network and to head office. The reforms are described in terms of what the company will do, so they are reported here as intentions the company has stated. On compensation, the company says it will increase the proportion of compensation for after-sales service from less than 5% of total compensation to approximately 20%.
On commissions, the announcement states, in the first person plural of the company: “To support long-term relationships with customers, we will extend the payment period for sales commissions per new contract from four years to seven years.”
On the agency network, the company says that the 139 agencies that were in place nationwide as of July 2026 will be gradually phased out, with plans to ultimately establish 40 to 50 agencies under the new structure.
At head office, the announcement describes a change that the company states it has already made: in July 2026, the Company separated the sales strategy and sales oversight functions at head office and established the new position of Head of Sales Oversight (HSO), reporting to the President. For customer support, the announcement describes a customer support program that it presents as already running: currently supported by 51 Customer Support Partners, and the Company will continue to expand the team from fiscal year 2027 onward. InsuraBeat has separate coverage of Japan’s updated governance code and insurer cross-shareholdings.
