Japan's Dai-Ichi Life Profits Boosted by Stable Domestic Business

13 Feb, 2024

Japan's Dai-Ichi Life Profits Boosted by Stable Domestic Business

In the first half of FY2023, the group experienced an uptick in fundamental profit, primarily attributed to reduced COVID-19-related payouts within the domestic market.

Over the long term, AM Best anticipates the group's stable domestic insurance business and expanding profitable overseas ventures to sustain its profitability reliably.

AM Best recently reaffirmed The Dai-ichi Life Insurance Company's (DL) Financial Strength Rating of ‘A+’ (Superior) and Long-Term Issuer Credit Rating of ‘aa-’ (Superior), with a stable outlook.

These ratings reflect DLH’s robust balance sheet, strong operational performance, favorable business profile, and effective enterprise risk management.

DLH serves as the umbrella organization for the entire Dai-ichi group, with DL considered integral due to its financial, operational, and strategic significance to the conglomerate.

In FY2022, Dai-ichi Life Holdings (DLH) showcased resilient operating performance, achieving JPY6.6tn ($44.3bn) in consolidated premium income and a fundamental profit of JPY364bn.

Despite challenges such as COVID-19-related losses and market volatility, DLH maintained a strong return on equity over the past five fiscal years, averaging 6.1%.

DLH's balance sheet strength, assessed through Best’s Capital Adequacy Ratio (BCAR), remained robust despite fluctuations, underpinned by conservative financial leverage and effective asset-liability management.

In Japan, DLH sustains its position as one of the largest private life insurance groups, leveraging diverse distribution channels and brands like Dai-ichi Life, Dai-ichi Frontier Life Insurance Co, and The Neo First Life Insurance Company.

The group's overseas expansion contributes significantly to its in-force annualized premium and adjusted net profit, offering geographical diversification and growth prospects.