Japan Post Insurance maintains strong capital: Moody’s

Profitability remains modest.

Moody’s expects Japan Post Insurance Co., Ltd. to maintain its strong market position, solid liquidity, and healthy capital base over the medium term, supported by stable margins and disciplined risk management. 

The insurer’s capital position remains robust, with an adjusted capital-to-assets ratio of 12.5% and an economic solvency ratio of 204% as of March 2025, broadly unchanged from a year earlier. 

Moody’s expects solvency to stay strong, backed by conservative investments and limited appetite for large acquisitions.

Profitability remains modest, with a five-year average return on capital of 1.8%, below peers. 

However, profits have improved due to higher interest margins, better investment performance, and lower hedging costs. 

Rising domestic interest rates are expected to lift reinvestment yields and support earnings growth.

Moody’s also expects strong government support if needed, given the insurer’s importance to Japan’s life market and its role in fulfilling universal service obligations.