Legal Expense Insurance (Car and non-Car)

For non-native speakers who drive a car in Japan, it is a good practice to be prepared with “legal expense insurance” which covers the costs for legal action (attorney fee etc.).

Negotiation about car accident is very frustrating, even for native speakers. Both side may say different things (such as the color of the signal), and the agent of the insurance company are often impolite. If you are not a native speaker in that country, the stress of negotiating will be very very large.

So, you may want to hire an attorney to negotiate in place of you. But in that case, you will have to pay the attorney fee yourself, even if there is no fault on you. You may feel very unfair about this.

This is the reason why there are types of insurance such as “legal expense insurance”. If you are prepared with this type of insurance, the insurance company will pay the attorney fee for you. You can ask your own insurance company if they provide this type of insurance (maybe it is already included in your insurance policy).

Also, it is suggested to get covered with “vehicle insurance” for the damage of your own vehicle. This is because even if you go through a lawsuit and win at last, you cannot get anything if the other driver has no property at all.

Although I am a Japanese speaking attorney living in Japan, my car insurance policy is fully covered including legal expense. If I was living in a foreign country, I would surely like to be much more protected.

This is not only about car drivers. You (or your family) may be involved in an accident when you are walking or riding a bicycle. Insurance companies also provide legal expense cover for non-car damage insurance. If you are interested, I recommend you to check and see.

Guarantor system in Japan “Rentai-Hoshou-Nin” (3)

Previous posts:
Guarantor system in Japan “Rentai-Hoshou-Nin” (1)

Guarantor system in Japan “Rentai-Hoshou-Nin” (2)

“Rentai-Hoshou-Nin” means joint and several guarantor. (Simple “Hoshou-Nin” means guarantor.) There is a big problem with the term several, but I will explain it later.

I wrote about the term “several’ on the previous post. So, what will “several” gurantee mean?

1) When you simply guarantee (“Hoshou-Nin”)

When you simply guarantee somebody’s debt (let’s say 100,000JPY), and if that somebody (the main debtor) found another person to guarantee his debt, so there are 2 guarantors including you, then the amount you will have to pay will be 1/2 (50,000JPY). If there are 4 guarantors, you will just have to pay 1/4 (25,000JPY). This kind of simple guarantor is called simply “Hoshou-Nin” in Japanese.

Also, if the creditor comes to you and says “Pay the money you’ve guaranteed!”, you can say “The main debtor has money in his bank, so please go to him first”. Then, the creditor will first have to go to the main debtor.

2) When you become “Rentai-Hoshou-Nin”

But if you become “Rentai-Hoshou-Nin”, it won’t be like this. No matter how many guarantors there are, you will be responsible to pay the full amount (100,000JPY).

Also, even if the creditor comes to you from the beginning, you can’t say “Go to the main debtor”. The creditor can charge you from the first time.

This will be very important. Here’s an example.

  1. You become “Rentai-Hoshou-Nin” when somebody (the main debtor) rents a house in Japan.
  2. The main debtor didn’t pay his rental money for 1 year.
  3. The main debtor goes back to his country without paying.
  4. The house owner comes to you and says “Pay the unpaid rental money”.

In this case, you will have to pay the full amount. Even if the main debtor has a good job in his own country, and he seems to have a lot of money in his bank account, you can’t say “Please charge him first”. You will have to pay the money yourself, and then, you will have to find the main debtor and say “Pay me the money I paid in place of you”. This can be very difficult when the main debtor has gone away from Japan.

3) I am not saying that you should never become a “Rentai-Hoshou-Nin”. In some cases you yourself may need to ask your friend to become your “Rentai-Hoshou-Nin”. But once you become one, you should be very careful if the main debtor is paying his monthly money, and if the main debtor isn’t paying, make solid contact with both the main debtor and the creditor to resolve the situation. You may sometimes have to persuade the main debtor to terminate the lease and leave the house as soon as he can.

Don’t forget, when you become a “Rentai-Hoshou-Nin”, you should be very careful from beginning to end, which is, until the main debtor completes all his paying (if the case is about house rental, you should also confirm that the main debtor has actually left the house).

When you receive SPAM

SPAM When you use e-mail, you may become a victim of SPAM (wikipedia).

Recently, spammers don’t only send simple advertisements. Some spammers send a massive amount of spams, such as several hundred per day, to your cell phone. Those spammers’ plot is to make you disgusted at hundres of “You’ve got mail!” on your cell phone, and they try to lead you to their “Unsubscribe Form” on the Website.

Once you access the “Unsubscribe Form”, you may be required to fill out the form with your real name, your phone number, your real address, and so on. If you follow their instruction, your personal information will fall into the wrong hands.

So, if you are receiving SPAMs on your cell phone, NEVER access the Websites written on the SPAM. There are filtering services provided by the phone company, so you should use those services instead of accessing the “Unsubscribe Form”.

Guarantor system in Japan “Rentai-Hoshou-Nin” (2)

* Previous post: Guarantor system in Japan “Rentai-Hoshou-Nin” (1)

Once you become a Rentai-Hoshou-Nin for your friend’s house rental, you are likely to  bear responsibility for the following points.

  • rent money of the house (and also late payment charge)
  • damage related to the house rental (such as scratches on floor, broken windows, etc.)
  • anything else

You may think it will not become a large amount, but, as a matter of fact, it could become very big.

For example, if your friend runs short of money and stops to pay his rent money, you will have to pay his rent money for him.

If the management company of the house contacts you immediately after your friend’s non-payment, the amount may not be large. But management companies sometimes do not contact the Rentai-Hoshou-Nin for months. If your friend is behind his payment for 10 months, and if the rental money is JPY100,000 per month, the amount will reach one million. I once saw a case, in which the management company didn’t contact the Rentai-Hoshou-Nin until the unpaid amount has reached 3 million JPY. In that case, the Rentai-Hoshou-Nin ended in bankruptcy.

Guarantor system in Japan “Rentai-Hoshou-Nin” (3)

Guarantor system in Japan “Rentai-Hoshou-Nin” (1)

When someone makes agreements in Japan, such as when he/she rents a room, “Rentai-Hoshou-Nin” may be required.

“Rentai” means joint.
“Hoshou” means guarantee.
“Nin” means person.

And, “Rentai-Hoshou-Nin” means joint and several guarantor.
(Simple “Hoshou-Nin” means guarantor.)
There is a big problem with the term several, but I will explain it later.

When you are asked to become a “Rentai-Hoshou-Nin”, you should consider the situation very carefully.
By easily signing your friend’s house rental contract, you may bear grave responsibility beyond your expectation.

Guarantor system in Japan “Rentai-Hoshou-Nin” (2)