Prudential Financial has extended the voluntary suspension of new business at its Japan unit for another 180 days, pushing the expected end of the freeze to November 2026.
The company has also withdrawn its target of increasing earnings per share (EPS) by up to 8% by 2027. It now expects the sales freeze to reduce results by as much as $575m (Y91.58bn) in 2026 and $450m in 2027.
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The move follows the 90-day pause that started on 9 February 2026.
The insurer said extra time is needed because the changes required at Prudential of Japan (POJ) are broader and more complicated than first expected and will take longer to prepare and put in place.
According to the company, the work covers operations, governance, organisational structures and other related measures needed before sales can restart.
It also said an independent external review of POJ’s management system was launched earlier this year as part of its governance process.
Prudential said the longer suspension should also support changes to the captive Life Planner model so that incentives and decision-making are more closely tied to customer interests.
The restriction applies only to new sales. Existing policyholders and servicing for policies already in force are not affected.
The decision comes after misconduct cases emerged in its Japan operations.
In January, Prudential Financial’s Japanese life insurance arm disclosed that around 100 former and current employees had improperly taken around Y3.1bn from customers. An independent compensation committee has been investigating the scale of the losses.
Meanwhile, Nikkei has reported suspected misconduct at Gibraltar Life Insurance, another Japanese unit of Prudential Financial.
During the investigation, dozens of cases were identified in which former employees were suspected of mishandling customer money, according to sources.
Some cases involved fictitious investments and other forms of misappropriation similar to those seen at Prudential Life.
Prudential Holdings of Japan, headquartered in Tokyo, operates as a holding company overseeing operations in Japan for its ultimate parent, the US-based Prudential Financial.
At present, the Gibraltar cases remain unconfirmed. The compensation committee is expected to review each case to decide whether compensation is required and, if so, in what amount.
Japan’s Financial Services Agency (FSA) has started an on-site inspection of Prudential Holdings of Japan. Among the issues under review is whether the parent company was aware of the misconduct and failed to respond.
If fraud is found to have spread across more than one subsidiary, further questions are likely to be raised about the parent’s oversight of the group. If the FSA identifies legal breaches or inadequate governance, it may issue business improvement orders or order suspensions.
