Asahi Life’s capitalisation boosted by robust underwriting: Fitch

The company’s core profit margin increased to 16% in the first half of FY 2025.

Asahi Mutual Life Insurance has shown stronger capitalisation, improved profitability, and a declining negative spread, Fitch Ratings assessed. 

Fitch expects the company to sustain its positive trajectory in profitability and capital strength.

Asahi Life's capital adequacy improved significantly during the financial year ending March 2024 (FY 2024), driven by capital accumulation despite market volatility. 

Fitch projects continued capital strengthening through robust underwriting and steady capital build-up.

Profitability has also rebounded, with the company’s core profit margin increasing to 16% in the first half of FY 2025, compared to 10% during the same period last year. 

This recovery follows a sharp drop to 4% in FY 2023, attributed to pandemic-related hospital claims. 

The easing of pandemic-related measures has since supported profitability, surpassing pre-pandemic levels.

The company's negative spread burden declined to $6.4m(JPY1b) in the first half of FY 2025, down from $110m (JPY18b) a year earlier. 

Fitch expects the negative spread to shrink further, potentially turning positive within several years as average guaranteed yields continue to decrease.

Share in the health insurance segment also grew to 4% by FY 2024, signalling a heightened focus in this market.

($1.00 = JPY157.4)