Nippon Life proves resilient amidst pandemic

The insurer proved stable with core operating profits at ¥690b.

Nippon Life Insurance Company has proven its resilience amidst the pandemic with its strong balance sheet and risk-adjusted capitalisation according to ratings firm AM Best.

AM Best assessed that Nippon Life’s balance sheet strength is strong as well as its operating performance, favourable business profile and has appropriate enterprise risk management.

For the fiscal year ended 31 March 2021 (FY2020), its core operating profit remained stable at ¥690b ($6.06b). Although the company’s annualised premiums from new policies declined due to sales restrictions in the first half of FY2020, its annualised premiums from new policies have been recovering since the second half of FY2020. AM Best said it expects the company’s new sales performance will continue to recover, and the company’s stable in-force book of business will continue to support its core operating profit sustainably.

“Although the company is exposed to moderate equity risk from its stock investment portfolio, its sizable available capital and its good access to debt markets as a well-known life insurance company in Japan and overseas should allow it to absorb such risk,” AM Best said.

Nippon Life is one of the leading life insurance companies in Japan, with a market share of 18% in terms of premium income.