Japanese insurers see profit surge in H1 2024, investment gains

The outlook for fiscal 2024 remains positive, said CreditSights.

Japanese life insurers reported higher core profits in the first half of 2024, driven by increased investment returns and a shift toward Japanese government bonds (JGBs), according to CreditSights. 

Investment strategies included larger holdings of longer-dated bonds, with Dai-ichi Life increasing its JGB holdings by $1.25b (¥193.5b) to mitigate interest rate risk.  

Solvency remained strong, with most insurers maintaining high solvency margin ratios (SMRs) and economic solvency ratios (ESRs). 

However, the premium growth was mixed, with most insurers seeing gains from new product launches and overseas expansion, whilst Nippon Life recorded declines.  

The outlook for fiscal 2024 remains positive, with expectations of further core profit growth, though potential regulatory changes and market volatility pose challenges.