Tokio Marine faces near-term pressure despite steady domestic outlook

International profit reached only 49% of the full-year plan thus far.

Tokio Marine might see weaker earnings from its international business for the year ending March 2026, with currency depreciation, lower overseas interest rates, and higher claims from the Los Angeles wildfires weighing on results.

International profit reached only 49% of the full-year plan so far, below the usual 57% pace, according to a Morningstar research note.

The company cut its full-year adjusted net income target to $4.30b (¥672b) from $4.48b (¥700b), whilst raising its equity sales outlook by $0.38b (¥60b) to $4.22b (¥660b) to offset part of the slowdown.

Domestic results remain broadly in line with expectations.

Morningstar reduced its premium growth assumption for next year to 4.0% from 5.5% and lifted the loss ratio forecast to 65.5%.

Even so, the long-term view is unchanged, with net earned premium growth expected to average around 5% and the loss-expense ratio holding near 64.5% through fiscal 2030.

Return on equity is projected to ease from about 18% in fiscal 2026 to roughly 16% by 2030, mainly due to reduced equity sales later in the forecast period.

Adjusted net income is still expected to trend gradually higher, rising from an estimated $7.49b (¥1.17t) in fiscal 2026 to $7.94b (¥1.24t) by 2030.

Management will set a new dividend payout ratio in May 2026, following IFRS changes that will exclude equity-sale gains from adjusted profits. For now, the annual dividend has been raised to $1.35 (¥211) per share, and share buybacks increased to $1.54b (¥240b).

Overall, the outlook points to near-term pressure overseas but steady long-term expectations supported by consistent premium growth and stable cost ratios.