MS&AD Insurance Group Holdings Inc. plans to invest up to ¥700 billion (approximately $5 billion) to expand its presence in North America, aiming to double operating profit in the region, Bloomberg News reported, citing Chief Executive Officer Shinichiro Funabiki.
The Tokyo-based insurer holds the largest market share in Asia among global insurance firms but ranks third among Japanese peers in North America.
“So the challenge is how to become the top player there,” Funabiki said in an interview. He added that the company is focused on strengthening its organizational structure to support future profit growth, though decisions on specific business areas and investment targets are still pending.
Japanese insurers have been increasing overseas activity through acquisitions, as demographic trends in Japan continue to limit domestic growth.
In March, MS&AD announced that its subsidiary, Mitsui Sumitomo Insurance Co., would acquire a 15% stake in U.S.-based W.R. Berkley Corp. Funabiki said the group intends to continue pursuing investments in line with this strategy.
MS&AD expects net profit from its North American operations, including businesses in Canada and Mexico, to reach ¥166 billion for the fiscal year ending March 2025, more than triple the figure reported a year earlier, according to the report.
The company has previously stated it would redirect capital raised from the sale of cross-held shares to fund growth investments. After accounting for the Berkley stake, MS&AD estimates it will have between ¥600 billion and ¥700 billion available for further investments.
The company also plans to consolidate its non-life insurance operations by merging Mitsui Sumitomo Insurance and Aioi Nissay Dowa Insurance Co., with the merger expected to be completed by April 2027.
Funabiki declined to comment on potential cost impacts from the merger but said the combined entity may introduce a performance-based personnel system, building on changes implemented at Mitsui Sumitomo this fiscal year.
The merger is also expected to support governance reform. In March, Japan’s Financial Services Agency issued business improvement orders to four non-life insurers, including Mitsui Sumitomo Insurance, over the handling of customer information. In a separate investigation in December 2023, the same firms were cited for price coordination in corporate contracts.
“The most lacking aspect was the ability to anticipate risks,” Funabiki said. “Having two insurance companies of the same size with a dispersed organizational structure is not an optimal state.”
MS&AD was established in 2010 through the integration of Mitsui Sumitomo Insurance Group Holdings, Aioi Insurance Co., and Nissay Dowa General Insurance Co. The group operates across several business segments, including domestic and international non-life insurance, life insurance, financial services, and risk-related services.
As of March 2022, the company reported annual revenue of ¥5.1 trillion and employed approximately 40,000 people globally.
