Tokio Marine Group aims for 50% local profit ratio
Japan’s Tokio Marine Insurance Group aims for the overseas insurance business profit ratio to reach nearly 50% this year, with emerging markets including Thailand as the main contributors.
The company’s life insurance premiums in Thailand are expected to reach this year’s target of 7.41 billion baht or an 11% increase from last year.
Business diversification, tech adoption to restructure business and building a core identity to strengthen management are the three strategies to help the company achieve the overseas profit target, said Noboru Yamagata, first vicepresident of Tokio Marine Holdings.
Tokio Marine Group consists of Tokio Marine Holdings, 249 subsidiaries and 22 affiliates.
International markets contributed 3% to the Tokio Insurance Group in 2002, the company said, without providing a comparative figure for 2018.
With the saturated insurance industry in Japan, insurers have diversified into other countries as sources for growth.
The group plans to focus more on emerging markets, particularly in Asia, after the Japanese insurer last year acquired the Thailand and Indonesia insurance businesses of Insurance Australia Group, which predominantly comprises Safety Insurance of Thailand.
The emerging-market profit ratio is expected to double to 20% of the entire group this year, Mr Yamagata said.
Given the merger and acquisition plan, Tokio Marine Insurance Thailand and Safety Insurance will be consolidated into Tokio Marine Safety Insurance Thailand, the process for which is expected to be completed in early 2020.
Apart from Tokio Marine Insurance, the company operates life insurance businesses through Tokio Marine Life Insurance Thailand.
“We’re looking for opportunities to acquire companies that have the same business philosophy,” Mr Yamagata said.
Shin Tanimoto, chief executive at Tokio Marine Life Insurance Thailand, said the company targets total premiums of 7.41 billion baht, comprising 1.7 billion baht in first-year premiums and 5.77 billion baht in renewal premiums.
Somphot Keitkarival, deputy chief executive, said the company’s total premiums surged by 40% year-on-year to 3.01 billion baht at the end of May, while the overall industry’s premiums shrank.
Of the total, 1.08 billion baht was from first-year premiums and the remaining 2.05 billion was from renewal premiums.
Mr Somphot voiced confidence that the target would be achieved on the strength of the agent channel, whose first-year premiums rocketed 182% in the first four months.