> ## Content Index > Fetch the complete content index at: https://www.fintechobserver.com/llms.txt > Use this file to discover other available public pages before exploring further. # MS&AD Insurance Group FY2023 Results - URL: https://www.fintechobserver.com/ms-ad-insurance-group-fy2023-results/ - Published: 2024-05-27T06:38:09.000Z - Updated: 2024-05-27T06:38:09.000Z - Description: FY2023 Results Highlights - Author: Norbert Gehrke - Tags: #Migrated-1734246964256, #Import 2024-12-15 07:16 ### **FY2023 Results Highlights** - **Strong Top Line Growth:** Net premiums written surged by 328.5 billion yen (+8.4%) to 4,261.7 billion yen, driven primarily by significant growth in overseas subsidiaries. Domestic non-life insurance saw an increase of 27.5 billion yen, attributed to reinsurance inward from overseas subsidiaries, while overseas insurance subsidiaries experienced a 300.7 billion yen rise stemming from new business, rate hikes, and foreign exchange impacts. - **Record Profitability:** Net income climbed by 158.2 billion yen to 369.2 billion yen, reaching a new high. Group adjusted profit also achieved a record level, increasing by 157.7 billion yen to 379.9 billion yen. ### **Key Drivers of Profit Growth** - **Domestic Non-Life Insurance:** Rebound from COVID-19 losses, increased investment profit, including accelerated strategic equity holdings sales, and higher earned premiums. - **Domestic Life Insurance:** Rebound from COVID-19 related payments at MSA Life. - **Overseas Subsidiaries:** Premium growth in Asia, Americas, and Europe, including MS Amlin. Strong profitability improvement at MS Amlin, coupled with profit increases in other regions, led to record high Group adjusted profit. ### **Breakdown of Profitability** - **Domestic Non-Life Insurance (MSI+ADI):** Net income increased by 72.7 billion yen, mainly due to a rise in investment profit. - **Domestic Life Insurance:** MSA Life’s net income grew by 15.4 billion yen due to reduced COVID-19 losses, while MSP Life remained relatively stable. - **Overseas Insurance Subsidiaries:** Net income increased by 87.2 billion yen, driven by overall premium growth, profitability improvement, and lower catastrophe losses at MS Amlin, along with favorable insurance service profit in Asia. ### **Analysis of Key Segments** #### **Domestic Non-Life Insurance** - **Underwriting Profit (Before Catastrophe Reserve):** Decreased due to higher automobile insurance losses and natural catastrophe losses, despite increased earned premiums in automobile and fire insurance. - **Investment Profit:** Increased due to higher interest and dividend income and gains on sales of securities. - **Voluntary Automobile Insurance:** Premium increase influenced by changes in average payout per claim and insurance premium unit price, with an increase in the number of accidents and an E/I loss ratio rise to 70.9%. - **Impact of Natural Catastrophes:** Domestic natural catastrophe losses increased significantly due to hailstorm in Gunma in July 2023\. Overseas natural catastrophe losses saw a modest year-on-year increase. #### **Domestic Life Insurance** - **MSA Life:** Annualized premiums of new policies for the third sector increased by 5.9% year-on-year due to new product launches. Net income reached a record high of 28.1 billion yen, primarily driven by a decrease in COVID-19 related payments. - **MSP Life:** Gross premium reached a record high of 1,353.5 billion yen, driven by favorable market conditions. Ordinary profit declined due to increased policy reserve provisions for foreign currency-denominated insurance, despite higher interest and dividend income. Net income remained at a similar level to the previous fiscal year. #### **Overseas Subsidiaries** - **Net Premiums Written:** Increased in Europe, Asia, and the U.S. due to new business expansion and premium rate hikes. - **Net Income:** Increased by 87.2 billion yen, driven by profitability improvement at MS Amlin, positive business performance in Asia, and a rebound from financial market fluctuation impact in the previous year. #### **MS Amlin (Jan-Dec 2023)** - **Insurance Service Profit:** Improved significantly year-on-year due to top-line growth driven by market hardening, business expansion, and enhanced underwriting portfolio. - **Financial Profit:** Decreased due to higher insurance service expenses, offsetting the improvement in investment income. - **Net Income:** Increased significantly due to profitability improvement and a positive impact from recognizing deferred tax assets in Bermuda. ### **FY2024 Forecast** - **Strong Continued Growth:** Net premiums written are projected to increase by 338.2 billion yen (+7.9%) to 4,600.0 billion yen, driven by anticipated growth in both domestic and overseas subsidiaries. - **Further Profit Expansion:** Group adjusted profit is projected to reach 630.0 billion yen, reflecting a 250.0 billion yen increase (+65.8%) from FY2023. ### **Key Drivers of FY2024 Profit Growth:** - **Domestic Non-Life Insurance:** Increased underwriting profit and investment profit, boosted by sales of strategic equity holdings, are expected to contribute significantly. - **Domestic Life Insurance:** Profitability is anticipated to remain at stable levels, despite a projected loss on sales of bonds due to replacement strategies. - **Overseas Subsidiaries:** Stable performance of AUL and MS Re is anticipated, with moderate growth in other regions. ### **Detailed Analysis of FY2024 Forecasts** - **Domestic Non-Life Insurance:** Net income is expected to increase significantly due to higher underwriting profit and investment profit, driven by sales of strategic equity holdings. - **Domestic Life Insurance:** MSA Life’s net income is anticipated to be lower due to bond replacement strategies. MSP Life is expected to maintain stable profitability. - **Overseas Subsidiaries:** Net income is expected to decrease due to anticipated declines in AUL and MS Re profits, offset by growth in other regions and overseas life insurance. ### **Major Assumptions for FY2024 Earnings Forecasts** - **Domestic Natural Catastrophes:** Conservative projections for natural catastrophe losses, including provisions and reversals. - **Overseas Natural Catastrophes:** Assumptions based on historical trends. - **Sales of Strategic Equity Holdings:** Significant anticipated sales of equity holdings, generating substantial profit for domestic non-life insurance. - **Financial Market Environment:** Assumptions reflect current market conditions, including interest rate levels and currency exchange rates. ### **Key Initiatives for Future Growth** - **Rate Increases:** Continued focus on adjusting premium rates to reflect evolving risk profiles and market conditions. - **New Business Expansion:** Continued development and launch of new products and services to meet evolving customer needs. - **Digital Transformation:** Continued investments in digital technologies to enhance operational efficiency and customer experience. - **Global Expansion:** Ongoing efforts to expand the group’s international presence and capitalize on growth opportunities in emerging markets. ### **Shareholder Return** - **FY2023 Dividends:** Total annual dividends per share for FY2023 were 270 yen (+70.0 yen year on year/+30 yen compared to initial forecast). - **FY2023 Share Buyback:** A maximum of 50.0 billion yen share buyback was decided, with 10.0 billion yen already executed. An additional 150.0 billion yen share buyback was decided for capital level adjustment. - **FY2024 Dividend Forecast:** The annual dividend forecast for FY2024 is 145 yen (after 3-for-1 stock split). --- Please follow us to read more about Finance & FinTech in Japan, like hundreds of readers do every day. We invite you to also register for our short weekly digest, the “Japan FinTech Observer”, on [Medium](https://medium.com/tokyo-fintech/newsletters/japan-fintech-observer?ref=fintechobserver.com) or on [LinkedIn](https://www.linkedin.com/build-relation/newsletter-follow?entityUrn=7048203270833524736&ref=fintechobserver.com). Our global Finance & FinTech Podcast, “eXponential Finance” is also available through its own [LinkedIn newsletter](https://www.linkedin.com/build-relation/newsletter-follow?entityUrn=7166419856253280256&ref=fintechobserver.com), or via our [Podcast Page](https://podcasters.spotify.com/pod/show/exponentialfinance?ref=fintechobserver.com). 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