, Japan
Photo by Abby Chung from Pexels

Profitability of Japanese life insurers to rebound: Fitch

Insurers will see resurgence of overall profitability by 2024.

Japanese life insurers will maintain strong credit fundamentals in 2023, but risks remain in the market, Fitch Ratings reports.

Risks include the potential flattening of the yen bond yield curve, yen appreciation against the US dollar, widening of foreign credit spreads, and the possibility of a crash in Japanese equities. These factors have the potential to negatively impact the insurers' operations.

The ratings agency anticipates a resurgence in overall profitability for Japanese life insurers in 2024.

This will be fueled by the recovery in underwriting profitability following the easing of pandemic-related restrictions by the Japanese government in May 2023, as well as the revision of the "deemed hospitalisation" rule. 

ALSO READ: China Non-Life Insurance stable in Q1: Fitch Ratings

In 2023, aggregate core profits at the nine traditional Japanese life insurers declined to JPY1.54t (-41% year-on-year) primarily due to significant insured losses resulting from "deemed hospitalisation" related to the Omicron variant of COVID-19.

“We expect the life insurers’ capital adequacy to remain sufficient for their ratings for some time, largely due to steadily accumulated core capital. In addition, most Japanese life insurers are making efforts to reduce interest-rate risk to better cope with Japan's new regulatory regime, which will be introduced in 2025,” Fitch Ratings said.

As of the end of March 2023, the aggregate statutory solvency margin ratio for Japanese life insurers remained at a high level of 955%, slightly lower than the previous year's ratio of 999%.

Follow the link for more news on

Join Insurance Asia community
Since you're here...

...there are many ways you can work with us to advertise your company and connect to your customers. Our team can help you dight and create an advertising campaign, in print and digital, on this website and in print magazine.

We can also organize a real life or digital event for you and find thought leader speakers as well as industry leaders, who could be your potential partners, to join the event. We also run some awards programmes which give you an opportunity to be recognized for your achievements during the year and you can join this as a participant or a sponsor.

Let us help you drive your business forward with a good partnership!


Capital pressures linger as insurers adopt new accounting rule in South Korea
IFRS 17 adoption is seen to improve insight into margins and reserves, increase motivation for long-term profitability, and better global comparability for insurers.
Cover Genius redefines insurance with embedded protection technology
The insurtech eyes expansion in Asia, leveraging on the symbiotic relationship of digital and traditional insurance to tailor policies for diverse markets.