Life Insurance for Japanese Citizens: What You Need to Know

The short answer? Yes – Japanese citizens can qualify for life insurance in the United States, even without a green card or permanent residency. You need a financial tie to the country, to be in the US during the application process, and to meet standard health guidelines.

Keep reading for everything you need to know.

It is no secret that people cross country borders and decide where to work, live, and create families. We’ve encountered many of our clients who are no longer confined to their native countries but decide to spend a big portion of their time in the US. Naturally, they have many questions about securing the best policies. That’s why we created this guide on life insurance for Japanese citizens – we’ve outlined the advantages of US life insurance, the qualifications, and the process of obtaining a policy.

Before diving in, we want to take a second to remind you that you can always reach out to us if you have additional questions or would like us to take a look at your personal situation. You can give us a call, send us a message, or fill out the quote form on this page. We specialize in life insurance for foreign nationals and will take the time to understand your needs and match you with the right option.

Why Look for US Life Insurance as a Japanese Citizen

There are countless reasons why someone might look into securing life insurance coverage. Below, we’ve listed some of the most common reasons our clients have secured a policy.

Help with Japanese Inheritance Tax

Now, we are not tax professionals – international at that. However, the rates of Japanese inheritance tax have been a hot topic in the nation’s foreign community for a while now. They can reach a whopping 55%!

It’s no surprise that many families are trying to plan for taxes with life insurance, preserve their estate and taking advantage of the benefits it has to offer.

Market volatility

Life insurance offers security backed by the regulations of this industry. Many policies offer a cash value growth guarantee of zero, even in a market downturn. This is a huge advantage over traditional products that are more volatile when the market changes. Life insurance can be a great diversification tool when you don’t want all of your money in the same product.

Avoid Currency Devaluations

Life insurance proceeds will ALWAYS be paid out in US dollars. This is a huge advantage in an unstable world economy. Historically, the US dollar has been a more stable alternative than other currencies across the globe. This, in addition to the other benefits, makes US life insurance for Japanese citizens a very attractive opportunity.

A Way to Transfer Wealth Across Borders

Many young Japanese citizens decide to pursue higher education in the US or even call it a permanent home. Their parents are aware of international transfer gift limits and view life insurance as a legal, efficient, and secure way to transfer a larger portion of their wealth across borders. Through life insurance, they are not only able to comply with the regulations, preserve wealth, but also to provide a legacy to their children.

Peace of Mind

Life insurance provides peace of mind that when we are gone, our loved ones will be financially taken care of. It allows young families to ensure they will provide for their children even if they pass away prematurely.

The Opportunity to Work with A-Rated Companies

This is another piece of the puzzle, providing additional security in the company and the product you select.

Do Japanese Citizens Qualify for US Life Insurance?

Since we covered some of the reasons why someone might consider US life insurance, it’s time to turn our attention to the qualification process. We’ll touch on the basic requirements companies have when underwriting applications for life insurance for Japanese citizens.

Japanese citizens are classified as a Class A country for US life insurance underwriting. This means they have access to the widest range of US carriers and products and it is a significant advantage over citizens from many other countries.

Have US connection

This is the first thing companies need to establish. What is your nexus: your financial tie to the country? You cannot come to the US for the sole purpose of purchasing life insurance; you need to have a tie to the country. Below are some basic examples of a US connection:

• Married to a US citizen – This is one of the ways to meet the requirement. Keep in mind that if you haven’t applied for permanent residency or have no other connection to the country, you and your US spouse might need to apply for coverage together.

Here’s a real example: we are working with a couple where the wife is a US citizen and the husband is a foreign national, currently living and working abroad. The husband is able to qualify for coverage if he and his wife secure coverage together with the same carrier.

• Have assets in the US – Companies want to ensure you have a financial footprint in the country. Owning real estate or a business in the US qualifies.

• Have a US bank account -The account needs to be open for more than 90 days and carry a balance of over $100,000.

If you are not sure whether you meet any of these requirements, please reach out to us. We will take the time to understand your circumstances and try to match you with the right option for coverage.

Age

Many companies have an age limit when underwriting foreign nationals. Typically, the maximum age they will consider is 70.

Pro Tip: Please still reach out to us, even if you are over 70! Guidelines change on a regular basis, and even though we try to keep this guide up to date, there might be new options available.

Health and Lifestyle

Keep in mind that in addition to foreign national underwriting, you also need to meet the company’s guidelines when it comes to health and lifestyle. They will ask questions such as:

• Tobacco use
• Height and weight
• Medications and/or health conditions
• Family history
• Lifestyle and hobbies such as skydiving, car racing, etc.

How to Get Life Insurance as a Japanese Citizen: The Process

Here are the steps to secure a life insurance policy in the US. For a deeper look, check out our step-by-step guide to buying life insurance for visa holders.

Be in the US for the Entire Process

While this is not technically part of the application, it is a requirement every company has. You need to be in the country in order for us to start the application and get you the coverage you need. Please plan accordingly. You need to be here to complete a medical exam and any additional requirements the company may have.

Initial Conversation

During this step, we uncover your needs and reasons for securing coverage. We are strong believers in tailoring coverage to meet your needs and priorities, and we do that by asking the right questions. We’ll also advise you of the forms the company will need in order to approve your application.

Application and Medical Exam

We’ll get your signatures on all of the required forms and schedule the medical exam. Typically, the exam is non-invasive and takes about 20 minutes. If we know your schedule ahead of time, we can coordinate with the facility and get everything scheduled at a convenient time for you.

Underwriting

This is the longest part of the process. Companies review your medical history, exam results, financials, and ties to the country. It’s not uncommon for them to reach out to us for additional information and we handle all of that on your behalf.

Policy Approval and Delivery

This is the final step. You need to be in the US to accept the policy and sign the delivery forms. However, some companies will allow a Limited Power of Attorney — meaning you can appoint a trusted individual to accept the policy on your behalf. Please note: we need to know your schedule ahead of time and get the Limited Power of Attorney signed and submitted during the application stage.

Available Life Insurance Products for Japanese Citizens

If you are a Japanese citizen living abroad and are NOT a US citizen or permanent resident, chances are only permanent insurance will be available to you. Permanent policies offer lifelong protection and the peace of mind that you will not outlive your life insurance. They can also be very flexible and build cash value.

We’ve divided the permanent policies into 2 major categories:

Lifelong Protection Only – Guaranteed Universal Life (GUL)

GUL offers guaranteed coverage up to age 100 or beyond. Its main focus is to ensure that whenever you pass away, your beneficiaries are able to collect the death benefit. We have created a guide on Guaranteed Universal Life Insurance for Foreign Nationals.

Protection Plus Cash Value Growth

These policies are unique and can be customized to meet your specific needs and lifelong goals. They not only provide peace of mind but also cash value growth – money you can use while still alive to supplement your retirement or to help you financially in any other way.

Pro Tip: Make sure the policy is properly set up and that you have current illustrations demonstrating the cash value account.

Things to Consider When Getting Life Insurance as a Japanese Citizen

Here are a few important things to keep in mind.

What happens if you return to Japan

Most US policies remain in force regardless of where you live, as long as premiums are paid from a US bank account and a US address is maintained.

Annual Premium Payments

Most companies will only allow annual payment mode when underwriting policies for foreign nationals. This actually has several advantages — it ensures your policy will not lapse due to a missed invoice or payment, and companies often offer a discount for paying annually versus monthly.

Premium Financing

This is a unique concept. Some companies allow foreign nationals to use premium financing to cover the cost of insurance. In a nutshell, premium financing involves taking out a third-party loan specifically to pay for a policy’s premiums. High-net-worth individuals use this strategy to avoid paying for life insurance out of liquid assets. While premium financing can make sense in the right situation, we encourage you to seek guidance from your financial advisor to ensure it is the best financial decision for you.

Naming a Foreign National as a Beneficiary

It is very common to want to name a foreign national as a beneficiary on your life insurance policy. Companies allow this as long as there is a clear insurable interest. Another thing to consider is any possible foreign tax consequences your beneficiary could face. You can learn more in our guide on naming a foreign national as a beneficiary

Frequently Asked Questions About Life Insurance for Japanese Citizens

In Conclusion,

In conclusion, life insurance for Japanese citizens is possible. Companies will take a closer look at your ties to the US and ensure you have a financial connection. In order to get the process started, you need to be in the US and complete a medical exam. There may be additional requirements to satisfy, but we will be here to guide you and answer every question you have along the way.

We hope you find this guide helpful and we look forward to working with you.

Thank you!