How Japan's non-life insurers record $12.4b net income in fiscal 2024

As of 30 April, 57 general insurance companies were operating in Japan.

Japan’s non-life insurers recorded stronger overall results in fiscal 2024, supported by higher premium income and investment gains, according to the General Insurance Association of Japan (GIAJ).

Total net premium income across the 31 GIAJ members rose by $3.04b (¥447b) from the previous year to $65.1b (¥9.58t), driven mainly by revisions to fire and automobile insurance products and premium rates.

Net claims paid increased by $1.64b (¥241b) to $37.9b (¥5.57t). This was largely due to payouts from the January 2024 Noto Peninsula earthquake and higher automobile claims linked to inflation, though fire-related claims from typhoons declined.

Expenses grew by $544m (¥80b) to $20.8b (¥3.06t), but the net expense ratio improved by 0.7 points to 31.9% because of the increase in premium income.

Underwriting profit fell by $347m (¥51b) to $857m (¥126b), yet ordinary profit surged by $8.16b (¥1.20t) to $15.3b (¥2.25t), reflecting stronger investment income.

After tax, net income climbed by $6.27b (¥922b) to $12.4b (¥1.82t).

Industry outliers
Japan’s non-life insurance sector remains dominated by three major groups—MS&AD Insurance Group Holdings, Sompo Holdings, and Tokio Marine Holdings—following years of mergers and integrations since the country’s financial liberalisation in 1996, according to Toa Reinsurance Company, Limited’s “Japan’s Insurance Market 2025” report.

As of 30 April, 57 general insurance companies were operating in Japan.

Of these, 35 were licensed as domestic insurers, including those with foreign capital, and 22 were branch offices of foreign insurers. 

In March, MS&AD said it would merge its core units, Mitsui Sumitomo Insurance and Aioi Nissay Dowa Insurance, with the target date set for April 2027.

Alongside major insurers, cooperative and mutual insurance providers (known as Kyosai organisations) continue to play a role.

Members pool premiums to fund payouts for unexpected events, with products covering fire, auto, personal accident and annuities.

According to industry estimates, Kyosai organisations under the Japan Cooperative Insurance Association recorded about $14.3b (¥2.1t) in premium income in fiscal 2023 from fire, auto and personal accident products.

Meanwhile, the small amount and short-term insurance (SASTI) sector, introduced in 2006, has been expanding.

SASTI companies face lighter regulation, with only $68k (¥10m) in minimum capital required compared to $68m (¥1b) for regular insurers.

They mainly sell renters’ insurance, pet insurance, and liability products through real estate channels.

Some SASTI firms have grown large enough to consider converting into full insurers, whilst some traditional non-life insurers have also set up SASTI operations.

($1.00 = ¥146.51)