MS&AD Insurance Group Holdings has released its financial results for the second quarter of fiscal year 2024 (Q2 2024).
The report detailed an increase in net premiums written across most business segments and adjustments to its full-year projections (FY24).
The group reported a ¥269.5 billion rise in net premiums written, primarily attributed to the expansion of overseas business.
Domestic non-life insurance premiums rose by ¥75 billion to ¥1,624.4 billion, supported by higher volumes in automobile and fire insurance and increased reinsurance business sourced from Aioi Nissay Dowa Insurance (ADI)’s international units.
Overseas business premiums increased by ¥194.4 billion, with ¥94.4 billion attributable to underlying business growth, excluding currency fluctuations.
Conversely, domestic life insurance premiums fell by ¥32.6 billion to ¥858.6 billion, reflecting a normalisation of sales following a strong prior-year performance driven by new product launches.
Group adjusted profit reached ¥500.3 billion, representing 74.7% of the revised annual target of ¥670 billion.
Domestic non-life insurance businesses achieved a progress rate of 74.5%, while domestic life insurance reached 94.3%, outperforming expectations.
The international segment achieved a 69.4% progress rate, benefiting from favourable underwriting and financial performance.
Higher earned premiums, particularly in the automobile and fire insurance segments, coupled with reduced natural catastrophe losses, drove an improvement in underwriting profits. Investment profits also grew, supported by gains on the sale of strategic equity holdings.
In voluntary automobile insurance, the cumulative number of accidents declined by 1.4% as of September 2024 compared to the previous year. However, the earned/incurred (E/I) loss ratio rose by 0.6 percentage points to 71.2%, excluding natural catastrophe effects, it increased by 0.9 points to 66.4%.
Natural catastrophe losses in Japan decreased by ¥28.4 billion year-on-year, despite the Hyogo hailstorm in April. Overseas, natural catastrophe losses fell by ¥23.6 billion, reflecting reduced impacts from events such as the previous fiscal year’s typhoon in Guam.
New annualised premiums dropped 6.5% to ¥12.7 billion due to lower sales of standard medical and cancer insurance products, despite increased demand for products with relaxed underwriting conditions and long-term care insurance.
Gross premiums decreased by 1.9% to ¥232.1 billion. However, core profit rose by 13.6% to ¥22.2 billion, supported by increased interest and dividend income.
Gross premium income fell by 4.3% to ¥626.5 billion due to a pullback from the prior year’s strong sales of new products.
Net income surged by ¥42.3 billion to ¥33.7 billion, benefiting from lower provisions for policy reserves as a large volume of contracts reached their target price, coupled with a recovery from the prior year’s deficit.
The group’s international operations reported significant growth in net premiums written, led by Lloyd’s operations and reinsurance, along with expansion in Asia, Europe, and the Americas.
Net income for overseas subsidiaries increased by ¥57.3 billion, driven by improved profitability across all segments.
Net income for the January-June 2024 period (on an IFRS 17 basis) rose by £83 million year-on-year to £87 million.
Insurance service profit increased by £71 million to £116 million, supported by better underwriting performance, despite absorbing losses from the Baltimore Bridge incident in Q1.
The combined ratio improved to 84.5%.
For the January-June 2024 period, net income increased by US$71 million to US$128 million.
Insurance service profit rose by US$41 million, driven by US$492 million in premium growth from favourable market conditions and reduced natural catastrophe impacts.
The group revised its forecast for non-life insurance subsidiaries’ net premiums written, increasing it by ¥13 billion to ¥3,129 billion, reflecting higher sales of automobile and fire insurance policies.
Forecasts for overseas subsidiaries were adjusted upward by ¥14 billion to ¥1,500 billion, reflecting currency exchange effects.
However, the gross premium income forecast for life insurance subsidiaries was revised downward by ¥99 billion to ¥1,572 billion, in response to adjusted sales expectations for MSP Life under current market conditions.
