Deferred assets under Article 113
of the Insurance Business Act
Article 113 of the Insurance Business Act allows deferral of business expenses for the first five years after commencing business operations because the initial acquisition costs are significant in the life insurance business. The deferred assets are allowed to be amortized within 10 years when providing in the Articles of Incorporation.
Lifenet recorded marketing expenses incurred from fiscal 2008, its business commencement, until fiscal 2012 as the deferred assets, and had intended to amortize the deferred assets until fiscal 2017, the tenth year after business commencement. Lifenet has been recording on a straight-line method amortization amounting to 1,060 million yen each fiscal year since fiscal 2013. However, we amortized our entire deferred assets in fiscal 2016 one year ahead of schedule.