Tokio Marine premiums to hit $45.4b by 2028

Morningstar sees total revenue rising to $57.6b as rate hikes offset higher claims.

Tokio Marine Holdings expects steady premium growth and stronger shareholder returns over the next few years, supported by pricing increases in Japan and the US.

According to a Morningstar Equity Analyst note, it expects Tokio Marine’s net earned premiums to rise from $39.6b (JPY6.28t) in fiscal 2025 to $41.1b (JPY6.53t) in 2026, before reaching $45.4b (JPY7.20t) by 2028.

Total revenue is forecast to increase from $49.8b (JPY7.9t) in 2025 to $57.6b (JPY9.14t) in 2028.

Morningstar said rate hikes in domestic motor and fire insurance, alongside selected US business lines, are expected to offset higher claims costs and normalised catastrophe losses.

It forecasts Tokio Marine’s combined ratio to remain below 95% in Japan and below 92% overseas, which it said reflects the insurer’s pricing strength.

The firm also expects shareholder returns to improve sharply in fiscal 2026.

Tokio Marine raised its dividend per share guidance by 12% to $1.54 (JPY245), whilst planned share buybacks increased 59% year-on-year to $2.5b (JPY400bn), implying a total yield of 5.8%.

Morningstar said it expects buybacks to stay at this level and forecast dividend growth at a compound annual rate of 9% through fiscal 2029.

The Berkshire Hathaway partnership is also expected to improve Tokio Marine’s long-term earnings stability.

Morningstar said the reinsurance arrangement would help transfer extreme natural catastrophe risks, reduce capital requirements, and support more aggressive capital returns whilst preserving flexibility for future acquisitions.

($1.00 = JPY159.63)