Yakuza Ineligible For Life Insurance

Yakuza just can’t catch a break. Now it’s life insurance companies that are tightening the noose. Organized crime has been a recognized industry in Japan, and extortion, built on a culture of shame, has been phenomenally successful. But like other classic industries, it’s in a tailspin. Modern yakuza groups emerged during the chaos after World War II when they fought violent gang wars in the streets. At its heyday in 1963, one year before the Tokyo Olympics, the industry had an estimated 184,000 members. But Japan changed, and by 2009, the last year for which official numbers are available, membership was down to 80,900.

For much of that time, officialdom and yakuza—bōryokudan (violent group) as officialdom insists on calling them—coexisted in an ambiguous relationship, and victims of extortion paid quietly, afraid of being publicly shamed. Yakuza are by no means secret. They show off their tattoos at festivals. Senior bosses give interviews. And the 22 yakuza syndicates are registered with the government.

Kiyoshi Nakabayashi, a retired Tokyo cop with decades of leadership in the matter, exemplified the official form of tolerance during an interview with the Japan Times.

“Make sure you don’t unintentionally burst in on them,” he said. “For most part, bōryokudan members won’t set out to do anything to a police officer. The cases where officers have been killed are generally when bōryokudan members didn’t intend it, but circumstances prompted desperate measures.”

Yet when a pissed-off yakuza boss assassinated the mayor of Nagasaki in 2007, the mood changed, and tolerance turned into crackdowns—and into new laws with teeth.

The organized-crime exclusionary laws that went into effect prefecture by prefecture—the last two, Tokyo and Okinawa, completed the cycle in October—criminalize doing business with yakuza in even mundane things. Like life insurance.

Life insurance companies have always been able to decline an application by yakuza on the grounds that he was in a high-risk job and that the policy could be abused for fraudulent activities. However, they had to find out about his status during the screening process—by the presence of tattoos for example. Once an applicant obtained coverage, the contract couldn’t be canceled anymore if the company found out about his gang membership, and benefits had to be paid even if he died as a result of a gun fight.

Now the Life Insurance Association of Japan notified its 45 member firms to add organized-crime exclusionary clauses to their policies, allowing companies to cancel the policy whenever it’s discovered that the insured, the policyholder, or the beneficiary is a yakuza. Even in cases of natural death, companies can deny the payment of benefits. A similar movement is underway with other forms of insurance. And yakuza, who have families too, are beginning to fret.

And it gets worse for those who specialize in extortion.

The fear by Japanese people of being shamed publicly is the primary reason why extortion has been such a phenomenally successful business. For example, the mere threat by yakuza to send some goons to shareholder meetings to disrupt them with hurled-out bid-rigging accusations would motivate a company to pay.

“The Japanese culture of shame can really have a negative effect,” Nakabayashi said. But with the new laws, “the old reactions of just resigning yourself to victimhood, of giving in to fear and uncertainty will disappear.”

Now that giving in to extortion is illegal, a convenient source of livelihood for the yakuza is expected to dry up. But what will all these yakuza do when they lose their jobs? File for unemployment?

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