In their financial results for the previous fiscal year, Japan's four major life insurance companies reported record-high core profits- earnings from their primary insurance operations- driven by an improved investment environment, including higher dividends from stock holdings and rising interest rates, reported NHK.
Notably, Nippon Life Insurance surpassed the JPY1tn mark in core profits for the first time.
By May 26, all four insurers had released their group-wide financial results. Nippon Life reported a 32% year-on-year increase in basic profit, reaching JPY1.0109tn.
The other three major players also recorded historic highs:
- Dai-ichi Life Holdings saw a 21% rise to JPY638.8bn,
- Meiji Yasuda Life Insurance posted an 11% increase to JPY626.4bn,
- Sumitomo Life Insurance reported a 24% gain to JPY379.8bn.
The surge in profits was largely attributed to gains from stock dividends and higher yields on investment assets amid rising interest rates.
However, insurance premiums and other income declined y-o-y for two of the four companies. This reflects intensifying competition among financial institutions for customer assets, as more individuals shift funds into investment trusts and other vehicles following the expansion of the NISA (tax-free savings) scheme.
NHK reported that Nippon Life Executive Vice President Naoki Akahori said, “We’ve achieved a significant profit increase, but given the highly uncertain outlook, we cannot afford to be optimistic about these results.”