Operations Section · As for business unit profits, FX ... 92.2% 91.3% 2017 2018 Projections 2020 ... technology and the progress of globalization, cyber

Operations Section

35 Domestic Non-Life Insurance Business

40 Domestic Life Insurance Business

43 International Insurance Business

What’sTokioMarineGroup

ManagementStrategySection

OperationsSection

SustainablyEnhancingCorporateValue

FinancialData

CorporateData

Composition of

Business Unit Profits

Fiscal 2018 (Projections)

Business Overview

Financial and General Businesses

Domestic Non-Life Insurance Business

International Insurance Business

With an extensive product lineup

and a diverse array of services,

Group companies provide optimal

products and services that fit

customer needs through a wide

range of sales channels.

44％

¥161.0 billion

Domestic Life Insurance Business

Tokio Marine & Nichido Life provides

highly unique, value-added products and

services, focusing on the field of living

protection, which is not fully covered by

conventional medical insurance or death

insurance.

10％

¥35.0 billion

Tokio Marine Group provides a broad

range of products and services that

have a strong competitive position in

developed markets, which are the core

of the global insurance market. The

Group is also building an extensive

network in emerging markets with high

growth potential, particularly in Asia

and South & Central America.

45％

¥165.0 billion

The financial business develops busi-

nesses with high capital efficiency,

primarily in the asset management

business. In general businesses, Group

companies provide products and

services related to “safety and security”

to customers, primarily in businesses

that are highly compatible with the

insurance business.

1％

¥5.0 billion

34 Tokio Marine Holdings | Integrated Annual Report 2018

Domestic Non-Life Insurance Business

Opportunities

Growth in new needs accompanying technological advancement, social change, etc.

Increase in corporate risk awareness due to globalization, etc.

Risks

Increase in scale of natural disasters accompanying climate change

Increase in new entries into the insurance industry by companies in other industries

Product development capabilities that have continued to generate industry-first products and services

Sales foundation that supports consulting and high growth potential through life and non-life cross-selling

Competitive business efficiency

Human resources with superior expertise, etc.

Tokio Marine & Nichido — Strategy Overview

Market Environment (Major Opportunities and Risks) Strengths

Best quality products and services

Reformationofproductlineport-

foliothroughintegratedlife–non-

lifebusinessmodel

Enhancementofproductsand

servicesthroughutilizationof

technologiesandothermeans

Best quality human resources

Maximize the Group’s comprehensive capability through alignment of Group management

Best quality business processes

Improvementofbusinesspro-

cessesandproductivitythrough

newtechnologies

Best quality sales channel

Improvementofsalesproductivity

throughenhancementofagents’

specialtiesandconsulting

capabilities

Expansionofnewsalesroutes

throughincreasedcoordination

betweenagentsthathave

differentstrengths

Characteristics of Group Companies

Tokio Marine & Nichido Providesalineupofdiverseproductsandservicesthatmeettheneedsofallcustomers

(individualsandcorporations)

Nisshin Fire Provideshighlyuniqueproductsandservices,specializinginthepersonalandSMEmarkets

Tokio Marine Millea SAST Insurance/

Tokio Marine West SAST Insurance

Providesinsuranceproductsforrentalhousingandtenants

E. design Insurance ProvidesautoinsuranceforindividualcustomersviatheInternet

Net Premiums Written in the Domestic Non-Life Insurance Business

(Trillionsofyen)

2013201220112010 2014 2015 2016 （FY）2017

1.8

2.3

Overall Strategy (Key Points of New Mid-Term Business Plan)

Throughtherelentlesspursuitofqualityinproductsandservices,distributionchannels,andbusinessprocesses,wewillwork

toachieve“sustainablegrowth”and“stableprofitgeneration.”

35Tokio Marine Holdings | Integrated Annual Report 2018

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Achievements in the Previous Mid-Term Business Plan

Underthepreviousmid-termbusinessplan,weaimedforsustainableprofitgrowthandtobuildasystemthatmaintains

thecombinedratio*1below95%.Weworkedtoimplementinitiativesintheareasof

“enhancement”(establishasolidbusinessplatform),“proactivemeasures”(strengthen

R&Dtomeetfuturechanges),and“continuousenhancementofprofitgrowth”

(strengthenunderwritingdisciplineandpursuebusinessefficiency).

Asaresult,theCAGRforbusinessunitprofits*2was+9.6%,substantiallysurpassing

theplan’stargetofaround+3%.Inaddition,despitetheinfluenceoflargenatural

catastrophesandotherfactors,thecombinedratioforfiscal2017was93.9%,and

wewereabletomaintainthecombinedratiobelowthe95%level.

*1LossRatio＋ExpenseRatio

*2TheCAGRcomparesbusinessunitprofitsoffiscal2017withthoseoffiscal2014.Asforbusinessunitprofits,FX

effectsareexcludedandnetincurredlossesrelatingtonaturalcatastrophelossesarenormalizedtoanaverage

annuallevel.

Toshifumi Kitazawa

TokioMarine&NichidoFireInsuranceCo.,Ltd. President&ChiefExecutiveOfficer

TokioMarine&Nichido

DomesticNon-LifeInsuranceBusiness

Responding to a Rapidly Changing EnvironmentWesteadilyimplementedthestrategiesoutlinedunderthepreviousmid-termbusinessplanand

increasedoursustainablegrowthpotential.However,duetosuchfactorsasdemographicshifts,the

occurrenceoflarge-scalenaturalcatastrophes,andrapidchangesintechnology,ourbusinessenviron-

mentischangingatanunprecedentedspeed.Accordingly,underthenewmid-termbusinessplan,we

willworktoaddressthefollowingimportantissues.

Further diversification of portfolio

Promotionofintegratedlife-non-life

businessmodel

Expansionofspecialtyinsurance,etc.

Appropriatecontrolofrisks

Enhancement of business structure

Developattractiveproductsandservices

Enhancequalityandexpandvolumeof

saleschannel

Enhanceproductivitythroughbusiness

processimprovement

Priorities

Taking On the Challenge of Best QualityToresolvetheissuesdescribedabove,underthenewmid-termbusinessplanTokioMarine&Nichido

willworktoachieve“sustainablegrowth”and“stableprofitgeneration”throughtherelentlesspursuitof

qualityinproductsandservices,distributionchannels,andbusinessprocesses.

Duringtheperiodcoveredbythenewmid-termbusinessplan,theconsumptiontaxincreaseand

therevisionofthelawofobligation,etc.,areexpectedtoputdownwardpressureonprofits.However,

throughthesteadyimplementationoftheabovemeasures,fromfiscal2017wewillaimtoachievea

CAGRof+1%ormoreforbothnetpremiumswrittenandbusinessunitprofits.Wewillaimtomaintain

thecombinedratiobelow95%andstrivetoachieveacombinedratioofapproximately92%to93%in

fiscal2020.

New Mid-

Term

Business

Plan

92.2% 91.3%

2017 2018Projections

2020Plans

Combined Ratio

(Private Insurance E/I Basis)

approx. 92–93%*3


2020Plans

2,144.7 2,146.0

Net Premiums Written

(Billionsofyen)

CAGR +1% or more

150.0155.0


2020Plans


(Billionsofyen)

CAGR +1% or more*2

Normalizedbasis*1

*1ExcludingFXeffectsandnetincurredlosses

relatingtonaturalcatastrophelossesare

normalizedtoanaverageannuallevel

*2Includingtheimpactoftheconsumptiontax

increaseandtherevisionoflawofobligation,

approximately–¥28.0billion(aftertax)

Naturalcatastrophesnormalizedtoan

averageannualbasis

*3Includingtheimpactoftheconsumption

taxincreaseandtherevisionoflawof

obligation(approximately2pt)


Health and productivity management

AsJapan’slaborforceshrinks,managingemployee

healthandcreatingagoodworkingenvironment

havebecomeimportantmanagementissues.

TokioMarine&NichidowillleveragetheGroup’s

expertiseasa“Health&ProductivityStock”for

threeconsecutiveyearstosupportSMEhealthand

productivitymanagementinitiativesthrougha

rangeofservices,suchasstresschecktestsand

mentalhealthconsultationsforemployees.In

addition,wewillprovidegroupinsurance,etc.,to

supportcompanies’employeebenefitprograms.

Best Quality Products and ServicesByofferingattractiveproductsandservices,we

willprovidecustomerswithfurthersafetyand

security,wewillsupportthemintheirtimesof

needastheytakeonchallenges.

Specifically,wewilltakestepstoimplement

thefollowingmainstrategieswhilefullyleverag-

ingtechnology,suchasofferingcoveragefor

individualcustomersthroughlifeandnon-life

cross-sellingbusinessmodelandproviding

specialtyinsuranceinordertosupportcustomers

astheytakeonchallenges.

Inthisway,wewillworktochangeourproduct

portfolioandadvanceourproductsandservices.

Life and Non-Life Cross-Selling

Business Model

“SuperInsurance,”whichisthecoreofthelife

andnon-lifecross-sellingbusinessmodel,isour

uniqueall-in-onelifeandnon-lifeinsurance

productthatwedevelopedandlaunchedin2002

withtheconceptofprovidingcustomersandtheir

familieswithlifelongsecurity.

Wewillworktofurtherenhanceproduct

attractivenessandincreasesalesofmultiline

policiesthroughconsultinginitiativesforbothlife

andnon-life.Inthisway,wewillincreasetheratio

ofthenumberofSuperInsurancepolicieswitheither

lifeorthirdsectorcoverageto25%infiscal2020.

Business Model for SMEs

Therisksfacedbysmallandmedium-sizedenter-

prises(SMEs)arebecomingmorediverseasthese

companiesexpandoverseas,andsuchSMEsare

thuscomingtorecognizetheneedtohedgerisks

evenwithinJapan.However,specialtyinsurance

products,whichallowforthishedgingofrisks,are

notyetcommonlyusedamongSMEs.Seekingto

supportthedevelopmentofSMEs’businesses,we

areadvancingabusinessmodelfocusingon

regionalrevitalizationandhealthandproductivity

managementtoachievegrowthintheSMEmarket.

Regional revitalization

Asthepopulationagesanddecreases,regional

revitalizationhasbecomeanimportanteconomic

issueforJapan.Workingincollaborationwith

regionalmunicipalities,financialinstitutions,and

chambersofcommerce,wewillprovideinsurance

thatofferscomprehensivecoverageofbusiness

risk.Wewillalsoprovideawiderangeofservices,

suchascallcenterswithspecializedinterpreting

capabilitiestoaddresstheincreaseinvisitorsto

Japanfromoverseasandonlinecoursesrelatedto

theimport-exportbusinessaffairsnecessaryfor

overseasbusinessinitiatives.Withtheseefforts,we

willsupportthebusinessdevelopmentofSMEs.

21%

16%

25%

2014 2017 2020Target

Super Insurance: Ratio of the number of policies

with either life or third sector coverage

*Estimatedthemarketsizeofspecialtyinsuranceonaninsurance

premiumsbasis,basedondataandsamplequestionnaire

distributedto3.2millionSMEs(excludingindividualbusiness

owners)with99employeesorless

Composition

ofspecialty

insuranceand

personal

accident

insurance

22%

Expanding

Developed

markets

Potentialmarkets

Approx. 65%

Tokio Marine &

Nichido: All Lines

Net Premiums

Written

(Fiscal2017)

Penetration Rate

of SMEs’ Specialty

Insurance

(Basedoncompanydata*)


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DomesticNon-LifeInsuranceBusiness

Addressing New Risks Accompanying

Social Change

Accompanyingsocialchange,suchasadvancesin

technologyandtheprogressofglobalization,cyber

risksandothernewrisksareemerging.Toprotect

customersfromthesevariousrisks,weareprovid-

ingcyberriskinsuranceandotherspecialtyinsur-

anceproducts.

Utilizing Technology

Accompanyingadvancesintechnology,customer

needsarediversifyingandthemeansofcustomercontactareexpanding.Wewillworktoincreasethe

addedvalueofourproductsandservicesbythoroughlyutilizingnewtechnologiestoprovideoptimal

coverageinlinewithcustomerattributesandtoestablishsimple,appropriateinsuranceprocedures.

Best Quality Sales ChannelIndistributionchannels,foragentsthroughout

Japanwehavebolsteredtheprovisionofsupport

tobecomescaledagentsandsalesagenttraining.

Withtheseefforts,weareworkingtoenhance

agentqualityandproductivity.Inaddition,wewill

expandnewmarketswhilestrengtheningcollabo-

rationwithagents,whohavedifferentstrengths.

Throughtheseinitiatives,wewillfurtherenhance

thestrengththatisthechoiceofcustomersand

realizegrowththatsurpassesthemarket.

Best Quality Business ProcessesSince2008,wehaveexecutedavarietyofopera-

tionalstreamlininginitiatives,suchasthe

“BusinessProcessReformProject,”whichaimed

forlarge-scalesimplification,centeredonprod-

uctsandadministration.Asaresult,wesubstan-

tiallyincreasedproductivityandrealizedbusiness

efficiencythatiscompetitiveincomparisonwith

othercompanies.

Movingforward,throughthethoroughgoing

utilizationofRPA*1andothernewtechnologies,

wewilladvancebusinessprocessimprovement

andimplementinitiativesthatlinknewlyavail-

abletimetoincreasedaddedvalueforcustomers.

*1Roboticprocessautomation

Cyber insur-

ance market

size*

(2016)

U.S.

¥250.0 billion

Europe

¥15.0 billion

Japan

¥13.0 billion

Other

¥12.0 billion

*Sources:OECD,JapanNetworkSecurityAssociation(Japandata)

Thefigurefor“Japan”includesinsurancelinesother

thansinglecyberinsurance(personalinformation

leakinsurance,etc.).

2010 2012 2014 2016

25.8%

27.0%

Competitive business efficiency

Expense ratio (all lines)

2010 2016 2017

TMNF

(Private

insurance)

35.1% 32.7% 32.5%

TMNF Market*2

*2TotalofthemembersofTheGeneralInsuranceAssociationof

Japan(excludingTMNF)

Source:TheGeneralInsuranceAssociationofJapan(Website)

35.0%

33.5%

32.6%

30.8% 30.7%

Growth outperforms the market

Trends of direct net premiums written(Billionsofyen)

7,174.9

8,611.2

1,851.4

2,322.1

Marketshare

TMNF Market*

*Source:TheGeneralInsuranceAssociationofJapan(Website)

CAGR +3.8%

CAGR +3.1%

Worldwide

¥290.0

billion



Underthepreviousmid-termbusinessplan,tobecomeacompetitivecompanyin

theretailmarket,wefocusedourmanagementresourcesontheretailmarketand

implementedthe“NisshinModel.”

ThroughsynergyeffectsamongcultivationofSMEsandnewproductsforthem,

theCAGRfornetpremiumswrittenwas+1.2%,andweachievedgrowthinthe

retailmarket.

Masato Murashima

NisshinFire&MarineInsuranceCo.,Ltd. President


Underthepreviousmid-termbusinessplan,withtheaimof“beingtheNo.1directinsurer

intermsofcustomers’choice,”weworkedtoenhancequalityinareassuchasaccident

responseservicesandourcallcenterwhilemakingourwebsitemoreconvenient.

Throughtheseinitiatives,theCAGRfornetpremiumswrittenincreasedsubstantially

to+18.6%.

Shigeo Kuwabara

E.designInsuranceCo.,Ltd. President

NisshinFire

E.designInsurance

Advancing the “Nisshin Model”NisshinFireisanon-lifeinsurancecompanyestablishedin1908.Thecompanyprovidessimple,easy-to-

understandproductstocustomersthrough13,607agents(asofMarch31,2018)withtheaimofbecom-

ingthemostfamiliarandtrustedretailnon-lifeinsurancecompany.

Underthenewmid-termbusinessplan,wewillfocusonthepersonalandSMEmarkets;implement

strategiesof“providinguniqueproductsanduniqueservices”and“strengtheningthebusinessplatform”;

andstrivetoprovidecustomersintheretailmarketwithvaluethatleveragesNisshinFire’sdistinctive

strengths.

Inparticular,wewilladvancethe“NisshinModel,”abusinessmodelthatprovidessimple,easy-to-under-

standproductsandhigh-qualityclaimsservicestogetherwithouragents,whoaredeeplyrootedintheir

communitiesandtrustedbytheircustomers.

Nisshin Fire’s Results

Fiscal2017results:Netpremiumswrittenincreasedby1.2%yearonyear,to141.8billionyen.Netincome

was5.3billionyen.

Fiscal2018projections:Netpremiumswrittentoincreaseby0.5%yearonyear,to142.5billionyen,andnet

incometoreach5.6billionyen.

New Mid-

Term

Business

Plan

New Mid-

Term

Business

Plan

Next Steps to Build a Sound Position with a Focus on the FutureE.designInsuranceisadirectnon-lifeinsurancecompanyjointlyestablishedbyTokioMarineGroupand

theNTTGroupinJune2009.E.designInsuranceprovidesautoinsuranceviatheInternettocustomers

whousetheInternettofindtheinsurancebestsuitedtotheirneeds.

Underthenewmid-termbusinessplan,asweworktoimproveourlossratioandadministrativeeffi-

ciency,wewillsteadilyadvancemeasurestoestablishasoundpositioninlinewithourgrowthinscale

andtakeonthechallengeofournextinitiativeswithafocusonthefuture.

E. design Insurance’s Results

Fiscal2017results:Netpremiumswrittenincreasedby9.9%yearonyear,to28.2billionyen.


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Domestic Life Insurance Business

Principal Opportunities

New needs resulting from advancing medical

technology

Preparation for “longevity risk” due to aging society

Progress of technology, such as AI and big data

Risks

Continuation of historic low interest rate environment

Life and non-life cross-selling initiatives

Unique, advanced products and services

Group customer base

Sales agents with high levels of consulting capabilities

Tokio Marine & Nichido Life — Strategy Overview


Risk control that supports sound growth


Develop innovative products

Proactivelycapitalizeonchanges

inenvironment,advanceliving

protectionproductstomeet

emergingneeds

Meetdiverseassetaccumulation

needs

Increase customer convenience /

operational streamlining

Furtherincreasequality,conve-

nience,andefficiencyofbusiness

processes

Useofnewtechnology

Strengthen sales capabilities and

sales platform

Cultivatethemarketutilizingthe

lifeandnon-lifecross-selling

businessmodel

Amalgamatedistributionchannels

Strengthenmanagementsupport

capabilitiesforagentswhowill

becomethecoreofgrowth

1997

600

400

200

0 1999 2001 2003 2005 2007 2009 2011 2013 2015 20171996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016

570555

530500

470

438

405378

349

317

283256

219

187160

134106

8757

4123

8

Number of In-Force Policies at TMNL (Total of individual insurance and individual annuities)

(Tenthousandsofpolicies)

Since its establishment, TMNL has recorded favorable

expansion, achieving 5.70 million in-force policies

in fiscal 2017.


With consideration for anticipated changes in the business environment over the long term, we will strive to realize sustained profit

growth by enhancing products, sales, and business processes and by advancing risk control.



TokioMarine&NichidoLifewasaimingforgrowthbasedonfinancialsound-

nessandprofitabilitybypromotingasalesshiftfromsaving-typeproductsto

protection-typeproductsunderthemid-termbusinessplan,andbydiversify-

inginvestmentinresponsetothelowinterestrateenvironment.Theincrease

inMCEV,*whichrepresentsbusinessunitprofits,was99.0billionyeninfiscal

2017,basicallythelevelprojectedwhenthemid-termbusinessplanwas

formulated.

Katsumi Nakazato

TokioMarine&NichidoLifeInsuranceCo.,Ltd.

President&ChiefExecutiveOfficer

TokioMarine&NichidoLife

Proactively Capitalizing on Changes in the EnvironmentInadditiontothepersistenceoflowinterestratesoverthelongterm,medium-to-long-termchangesin

thebusinessenvironmentincludedemographicshifts,technologicalprogress,andadvancesinmedical

technology.Inconsiderationofthesechangesinthebusinessenvironment,wewilltakestepsto

addressthefollowingpriorities.


Furthergrowthinprotection-type

products


Strengtheningofsalescapabilitiesandenhancementof

productivitythroughleveragingoftechnology

Turning Change into OpportunityWehaveforecastthatthebusinessenvironmentofthe

lifeinsurancebusinesswouldbechangingsignificantly

overthemedium-to-longterm.Overthethreeyears

ofthenewmid-termbusinessplan,wewillpromote

avarietyofinnovationsviewingthechangesas

opportunities.

Develop innovative products

Developlivingprotectionproductstomeetemerging

needs.Createnewaddedvaluebyusingadvancesin

technology.

Strengthen sales capabilities

and sales foundation

CultivatemarketbyleveragingtheGroup’scustomer

base.Strengthensupportformanagementofagents

whowillbecomethecoreofgrowth.

Increase customer convenience /

operational streamlining

Increaseproductivityandcustomerconvenience

usingadvancesintechnology.Strengthenoperational

managementtoachievebothefficiencyandquality.

*MCEVisanindexusedtoassessthevalueoflifeinsurancebusinesses

toensureconsistencywiththemarketvalueoffinancialinstruments.

Futureeconomicconditionsareevaluatedbasedontheassumption

thatthefiguresfromtheendofMarch2018willcontinue.

Priorities

New Mid-

Term

Business

Plan

102.1

104.2


2020Plans


2020Plans

New Policies Annualized Premiums (ANP)

(Billionsofyen)


(Billionsofyen) MCEV Growth Rate

CAGR +4% or more

CAGR +1% or more

Year-endMCEV*1 1,248.7 1,284.0 1,417.0

BusinessUnit

Profits*299.0 35.0 83.0

*1Thefigureforfiscal2017isafterpaymentofsharehold-

ers’dividends.Figuresforfiscal2018projectionsand

fiscal2020plansarebeforepaymentofshareholders’

dividends.

*2Figuresarebeforepaymentofshareholders’dividends.

MCEV

Increase

(Business

Unit Profits)


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DomesticLifeInsuranceBusiness

Product StrategiesTokioMarine&NichidoLifehaslauncheduniqueproductsthataddressconventionallyuntappedareas,

suchasinabilitytoworkandnursingcare,throughinitiativesimplementedunderthe“LifeInsurance

RevolutiontoProtectOne’sLiving,”*andtheseproductshaveearnedthesupportofcustomers.Under

thenewmid-termbusinessplan,wewillcontinuetolaunchuniqueprotection-typeproductsthat

reflectconsiderationforsuchfactorsasadvancesinmedicaltechnology.Inaddition,wewillalso

aggressivelyutilizenewtechnologiesanddevelopproductsthatsupportprevention,presymptomatic

disease,andhealthenhancement.Movingforward,wewillleverageourproductdevelopmentcapabili-

ties,whichareoneofourstrengths,andpromotethedevelopmentofproductswithhighaddedvalue

forcustomers.

Death

(Conventional life insurance)

Nursing care

requirement

(Permanent

disability)

“Life Insurance Revolution

to Protect One’s Living”

Advancement of “Life

Insurance Revolution to

Protect One’s Living”

* Diagram of “Life Insurance Revolution to Protect One’s Living”

Sales StrategyTokioMarine&NichidoLifehasdiversesaleschannels,includingnon-lifeagents,lifeprofessionals,life

partners(direct),andbancassurance.Underthenewmid-termbusinessplan,wewillcontinuetotarget

growthwithagoodbalanceamongthesefourmainchannels.Furthermore,wewillcultivatethe

marketwiththelifeandnon-lifecross-sellingbusinessmodel,generatefurthersynergyeffectsbyamal-

gamatingdistributionchannels,strengthensupportformanagementofagentswhowillbecomethe

coreofgrowth,andimplementotherinitiatives.Intheseways,wewillstrivetoprovidesafetyandsecu-

ritytoasmanycustomersaspossible.

Inability to work

(Home care)

Outpatient

treatment

(After discharge)

Hospitalization/

Surgery

(Medical insurance)

Prevention/

Presymptomatic

Coverage for conventionally untapped areas

Non-lifeagents

Approx. 60%

Lifeprofessionals

Approx. 25%

Bancassurance

Approx. 5%

Lifepartners(direct)

Approx. 10%

Channel

Composition

(Lifeinsurancepremiums

onamanagerialaccounting

basisasoftheend

ofMarch2018)

Non-life agents

Non-life agents

(Market holders)

Vastcustomerbase

Deepcultivationofthepotential

lifeinsurancecustomermarket

Highlevelofexpertise

Life professionals

Life partners



Growth of International Insurance Business (Net Premiums Written*1)

1,713.01,741.0

118.7240.2

319.5413.9 362.6

544.0 526.5 499.7

734.3

1,074.5

1,302.6 1,304.0

1,654.4

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018(Projections)

2,000

1,000

0

International Insurance Business

Favorable M&A track record (sustained growth due to

disciplined M&As*1 and smooth PMI*2)

Risk diversification through strong specialty franchise

in developed markets

Extensive business network in both developed and

emerging markets

(38 countries and regions around the world)

International Insurance Business — Strategy Overview


Sustainable organic growth

Achievesustainablegrowthbycompanies

withrobustbusinessmodelswhilealso

leveragingnewtechnologies

Strategic M&As

Captureprofitabilityofdevelopedmarketsandgrowth

potentialofemergingmarkets,advanceregionaland

businessdiversification,andachievebalancedgrowth

Opportunities

Stable growth in the U.S. and other developed markets

Economic development and growth of the middle class

in emerging markets, primarily Asia

Risks

Continuation of soft insurance market (declining trend

in premium rates) due to entry of third-party capital

Occurrence of large-scale natural catastrophes accom-

panying climate change

*1AcquisitionPrinciples

•Agoodmanagementteamsharingourvalues

(Managementsoundness)

•AGoodCompanywithhighprofitability

•Arobustbusinessmodelovercomingachangingenvironment

*2Post-mergerintegration,meaninganintegrationprocessafterM&A

Establishmentofreinsurance

subsidiary(TokioMillenniumRe)

Non-lifeacquisitioninemerging

markets

Lifeacquisitioninemerging

markets

(Billionsofyen)

Life Reinsurance NorthAmerica Europe*3 South&CentralAmerica Asia&theMiddleEast*3

*1FXratesareasofDecember31ofeachyear.(FXrateforfiscal2018projectionsisasofMarch31,2018.)

*2AsoftheendofJune2018

*3Upuntilfiscal2015,theMiddleEastwasincludedinEurope.Fromfiscal2016,theMiddleEastisincludedinAsia.

Establishmentof

lifejointventure

inIndia

AcquisitionofKiln

Acquisitionof

Philadelphia

AcquisitionofDelphi

AcquisitionofHCC

PlannedacquisitionofSafety*2

Developed Footholds in

Non-Japanese Business

Established Material

Presence in Lloyd’s (U.K.)

and the U.S.

Further

Expansion in

High Growth

Markets

Further Growth, Diversification, and

Capital Efficiency


WewillstrengthenalignmentofGroupmanagementandtakestepstopursuebothsustainableorganicgrowthandstrategic

M&As.Inthisway,wewillbethedriverofriskdiversificationandsustainableprofitgrowthfortheGroup.


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InternationalInsuranceBusiness

As the Group DriverTodrive“riskdiversification”and“sustainableprofitgrowth”fortheGroup,wewilladdressthefollowing

priorities.


ThroughstrategicM&As,wewilladvance

geographicalandbusinessdiversification.


WewillimprovethecompetitivenessoftheGroup

byenhancingdigitalstrategiesglobally.

Achieving “Risk Diversification” and “Sustainable Profit Growth” for the GroupDuetothecontinuationofthesoftinsurancemarketandotherfactors,theenvironmentischallenging.

Inthissetting,wewillstrengthenthealignmentofGroupmanagementandtakestepstopursueboth

sustainableorganicgrowthandstrategicM&As.Inthisway,wewillbethedriverofriskdiversification

andsustainableprofitgrowth.Asaresult,wewillaimforaCAGRofapproximately+5%fornetpremi-

umswrittenandaCAGRofapproximately+11%forbusinessunitprofits.

Priorities

New Mid-

Term

Business

Plan


AsthegrowthdriveroftheGroup,wepursuedgrowthopportunitiesgloballyand

theestablishmentofadiversifiedbusinessportfolio.WeacquiredHCCInsurance

HoldingsInc.,aU.S.specialtyinsurancegroup,inOctober2015,andalsoimplemented

growthinitiativesateachcompany.Inthisway,weachievedaCAGRof+9.5%in

businessunitprofits.*

*FXeffectsareexcludedandnat-catlossesarenormalizedtoanaverageannuallevel.Forfiscal2017,

one-timeimpactofU.S.taxreformisexcluded.

Satoru Komiya

HeadofInternationalInsuranceBusiness

SeniorManagingDirector

10000

40000


2020Plans

1,648.0 1,713.0


(Billionsofyen)

0

7000


2020Plans

145.0 165.0

C/R 98% (Normalized basis)

96% 95% level


(Billionsofyen)

CAGR approx. +11%*3CAGR approx. +5%

Normalized

basis*1

AppliedFX

rate

(USD/JPY)

March31,

2018

¥106.2

*1FXwhenconvertingtoyenisadjustedtoMarch31,2018.

(Regardinginternationalinsurance,thesameapplies

hereinafter.)

Normalized

basis*2

AppliedFX

rate

(USD/JPY)

March31,

2018

¥106.2

*2FXwhenconvertingtoyenisadjustedtoMarch31,2018.

ExcludingtheimpactofFXgains/lossesatmajoroverseas

subsidiaries.Nat-catlossesarenormalizedtoanaverage

annuallevel.Excludingone-timeimpactofU.S.taxreform.

(Regardinginternationalinsurance,thesameapplies

hereinafter.)

*3CAGRexcludingtheimpactofU.S.taxreformfrom2020plansis

approximately+8%.


Tokio Marine Kiln

Lloyd’s business

Philadelphia

24%

Philadelphia

Delphi

28%

Delphi

TMHCC

25%

TMHCC

Europe

6%

North America and others

2%

South & Central America

3%

Asia & the Middle East

5%

Life

1%

Reinsurance

5%

Fiscal 2018

Business Unit

Profits*2

(Projections)

Premium

Composition

by Line

(Fiscal2017results)

160

100

120

140

0

*1Trendofnon-lifedirectpremiumswritten;fiscal2012issetat

anindexvalueof100.

(Source)SwissReInstitute:GlobalInsuranceReview2017and

Outlook2018/19

*2Denominator:Totalofbusinessunitprofitsofinternational

insurancebusinessbeforeadjustmentofheadofficeexpenses

Emerging Market Growth*1

CAGR +6.2%

2016 2017(estimate)

2018(forecast)

2019(forecast)

2012

Major products

Humanservices

Realestate

Disability

ExcessW/C

Medicalstop-loss

Agriculture

D&O

U.S.liability

Property&Liability

Marine

Pursuing

Strategic

M&As

Emerging markets

Emergingmarketbusinessunitprofitsconstitutejust

under10percentoftheinternationalinsurance

business.

Wewillfurtherpromotegeographicaldiversification

throughtheimplementationofM&Asinemerging

marketswherehighgrowthisexpectedinthe

medium-to-longterm.

Developed markets

Indevelopedmarkets,whereNorthAmerica

accountsforapproximately80%ofbusinessunit

profits,risksarewell-diversifiedduetoawide

rangeofspecialtyinsuranceproducts.

Movingforward,wewillcontinueaimingto

furtherexpandthespecialtyfranchisethrough

M&As,includingbolt-onM&As.*

*M&Asimplementedwiththeobjectiveofcomplementing

existingbusinesses

Our FocusPromotestrategicM&AtargetingemergingmarketsinAsiaandotherregionsaswellasdevelopedmarkets,

withtheaimofestablishingawell-balancedbusinessportfoliothatdeliversstableandprofitablegrowth

2011 2014 2017

30.0

96.0114.5

298.1

372.0

125.0

*1AdjustedtotheFXofMarch31,2018

*2Nat-catlossesarenormalizedtoanaverageannuallevel.Asfor2017,

FXwhenconvertingtoyenisadjustedtoMarch31,2018,excluding

theimpactofFXgains/lossesatmajoroverseassubsidiaries,and

excludingone-timeimpactofU.S.taxreform.

FX(USD/JPY)

December31,

2011 ¥77.7

December31,

2014 ¥120.5

March31,

2018 ¥106.2

Major M&As Executed to DateSignificantcontributiontotheGroup’sprofitgrowththroughdisciplinedacquisitionprinciples

andsmoothPMI

Significant contribution to the Group’s profit

growth while maximizing Group synergies

Steadily growing after joining

Tokio Marine Group

Net premiums written of acquired Western companies

(normalized basis*1) (Billionsofyen)

BusinessunitprofitsofacquiredWesterncompanies

(Normalizedbasis*2)

AdjustednetincomeofTokioMarineGroup

(Normalizedbasis*2)

March2008

Tokio Marine Kiln

2017

¥158.0 billion

December2008

Philadelphia

2017

¥338.0 billion

May2012

Delphi

2017

¥238.0 billion

October2015

TMHCC

2017

¥334.0 billion

2008

¥48.0 billion

2009

¥199.0 billion

2013

¥199.0 billion

2016

¥317.0 billion

x 3.2

x 4.2


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NorthAmerica

Business OverviewPhiladelphiaisaU.S.P&Cinsurancegroupthathasachievedhighgrowthandprofitabilitysinceitsestablishmentin1962.

Strengths and Strategies

Strengths

Specializinginspecificindustriesandcustomersegments,suchasnon-profitorganizations,communitygroups,realestate,

schools,andsportsandrecreationfacilities,Philadelphia’sstrengthsincludeoutstandingproductdevelopmentcapability,

disciplinedbusinessoperation,andexcellentmarketingskillsutilizingitsdiversesalesnetworks.

Byfocusingonthespecificneedsofcertaincustomersegments,Philadelphiahasbuiltastrongbusinessmodelthatis

resilienttoeconomicfluctuationsandcompetitionwithcommodityproducts.Ithasachievedexceptionalbusinessresults,

includingacombinedratiothatconsistentlyfallsbelowtheU.S.P&Cmarketaverage.

Strategies in the New Mid-Term Business Plan

Wewillaimtomaintainandenhancethehighrenewalratio

andrateincreasesthroughimprovingtheproductivityofthe

franchisenetworkandproductsfocusedonnichemarkets.

Preferredagent

35.4%

Humanservices

32.8%

National/globalbroker

20.4%

Realestate

18.5%

PHLYselect*1

12.3%

Openbrokerage

25.7%

Directsales

3.3%

Wholesalers

2.5%

Other

0.3%

Publicservices

7.4 %

Mgmt.&Prof.

11.9%

Sports&Rec.

10.2%

Other

19.2%

Channel Composition(Fiscal2017)

Product Composition(Fiscal2017)

*1Candidatesforfuturepreferredagents

Maintain growth and profitability outperforming the market through

underwriting discipline and action

88.7% 88.7%89.0%

Renewal ratio


2020Plans

338.0

347.0


(Billionsofyen)


2020Plans

40.0

C/R 94% 96% 95% level

42.0


(Billionsofyen)

CAGR approx. +5%CAGR approx. +3%

Rate increases 2015 2016 2017

Philadelphia 3.6% 1.8% 1.5%

Marketaverage*2Approx.

1%

Approx.

0%

Approx.

1%

*2(Source)WillisTowersWatson

Normalizedbasis


2001‒2017 Recent 5 years

7.51%7.28%

4.74%

2.45%

A member of the Tokio Marine Group


Wewillaimtomaintainourleadershippositioninthe

employeebenefitsbusiness,realizegrowthintheretire-

mentservicesbusinessthroughincreasedsalesofannuities,

andfostercontinueddevelopmentofGroupsynergiesin

investment.

Business OverviewDelphiFinancialisaU.S.P&Candlifeinsurancegroupfoundedin1987thatfocusesonemployeebenefitsinsuranceand

services.Thegroupcontainscompanieswithalonghistoryandwealthofbusinessexperience,includingRelianceStandard,a

lifeinsurancecompanyfoundedin1907,andSafetyNational,anon-lifeinsurancecompanyfoundedin1942.


Strengths

Delphihasleverageditsstrengths,includingrobustunderwritingcapabilitiesbasedonmanyyearsofexperienceandstrong

relationshipswithdistributionchannels,toestablishitspositionasamarketleader.Ithasestablishedastableandsustainable

sourceofrevenuethroughitsmainproducts,whichhavetheadvantagesofbothlimitedexposuretonaturalcatastropherisks

andlessdependenceonpremiumratecycles.Inaddition,Delphi’shighlevelofinvestmentexpertiseenablesittoachieve

investmentreturnsthatfarexceedbenchmarksandtorealizehighlevelsofgrowthandprofits.Furthermore,throughinvestment

onbehalfofotherGroupcompanies,DelphiismakingasignificantcontributiontothedemonstrationofGroupsynergies.

Life insurance

58%

Non-life insurance

42%

Disability

31.5%

Grouplife

19.5%

Others(Life)

6.7%

ExcessW/C

21.9%

Others

(Non-life)

(W/Creinsur-

ance,etc.)

20.4% Product Composition(Fiscal2017)

Average Investment Returns Market Comparison

Maintain profit growth by leveraging its investment expertise as well as its

strengths in employee benefit products/services and retirement services

Delphi Benchmark(BarclaysAggregateIndex)


2020Plans

238.0

244.0


(Billionsofyen)


2020Plans

43.0

C/R 103% 100% 99% level

49.0


(Billionsofyen)


Normalizedbasis

A member of the Tokio Marine Group


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OtherA&H

2.7%

International

surety&credit

3.3%


Business OverviewTokioMarineHCC(TMHCC)isaworld-leadingspecialtyinsurancegroupoperatingintheU.S.andEurope.Sinceitsestablishment

in1974,ithasconsistentlyachievedhighprofitability,growth,stability,andsoundnessunderitsexperiencedmanagementteam.


Strengths

Sinceitsfounding,TMHCChasimplementedmanybolt-onM&As*andithasaccumulatedsignificantknowledgeinexecuting

thesetransactions.ThroughtheseM&Asandotherinitiatives,TMHCCdemonstratesitsstrengths,suchashigh-levelunderwriting

expertise,byprovidingover100differenttypesofspecialtyinsuranceproducts,includingA&H,agriculture,andD&Oinsurance,

anditmaintainsaleadingpositioninmanyofthemarketsitserves.Theseinsuranceproductsarelargelynon-correlated,and

accordinglyTMHCChasadiverseandhighlyprofitablebusinessportfolio.Consequently,eveninfiscal2017,whentherewere

manylarge-scalenaturalcatastrophes,thecombinedratiowasbelow90%.TMHCCconsistentlyrealizeshighprofitabilitythat

outperformsthemarket.

*M&Asimplementedwiththeobjectiveofcomplementingexistingbusinesses


TMHCCwillstrivetorealizegrowthinallbusinessesby

utilizingbolt-onM&Asandstrengtheningexistingfranchise

businesseswhilemaintainingbest-in-classprofitabilityand

combinedratio.Inaddition,TMHCCwillaimtoexpand

revenuesynergiesbyleveragingitshigh-levelunderwriting

expertiseonaworldwidebasis,includingJapan.

Medicalstop-loss

29.4%

Agriculture

17.7%

U.S.surety

4.2%

Sports&entertainment

4.6%

U.S.credit

2.2%

Product Composition

(Fiscal 2017)

Sources:CreatedbyTokioMarinefromCompanyreports,Dowling&Partners

Analysis(basedondatathroughDecember31,2017)

Consistent profitabilityProducts that are less dependent on the P&C market cycles

(approximately 64%)

Highest Combined ratio volatility

Lowest

Highest

Lowest

ProAssurance

Aspen

Baldwin&Lyons

Alleghany

Markel

Arch

PartnerRe

EverestRe

ArgoGroup

TravelersAmericanFinancial

ChubbLtd.

GlobalIndemnity

Navigators

TMHCC

W.R.Berkley

CNA

AXIS

XL

RLI

Hartford

Co

mb

ine

d ra

tio

de

ca

de

av

era

ge

Pursue organic growth in all businesses while maintaining high profitability

and enhance existing franchise businesses through bolt-on M&As


2020Plans

334.0 363.0


(Billionsofyen)


2020Plans

42.0

C/R 89% 89% 88% level

43.0


(Billionsofyen)


Normalizedbasis


Europe


Wewillpromotegrowthstrategiesbyexpandingdistinctive

specialtyinsuranceproductssuchascyberandintellectual

propertyandbygrowingU.S.businessesthroughstrength-

enedtieswithcoverholders.*1

*1Agentsthathavebeengivenunderwritingauthorityfrominsurance

companies

Business OverviewTokioMarineKilnisaninsurancegroupintheglobalinsurancebusiness,centeredonLloyd’s.ItssubsidiariesincludeTokio

MarineKilnSyndicates,whichoffersoutstandingexpertiseandhashadoneofthelargestunderwritingcapacitiesinthe

Lloyd’sofLondonmarketsinceitsestablishmentin1962,andTokioMarineKilnInsurance,aninsurancecompanywith

strengthinthecorporatemarket.


Strengths

TokioMarineKilnisoneofthebest-knowninsurancegroupsintheLondonMarket,benefitingfromthestrengthofLloyd’s

brandwith4thlargestunderwritingscale.Itsstrengthsincludebroadrangeofproductsandknow-howinspecialtyinsurance

aswellaspromptresponsetomarketcycleandearningspotentialbydisciplinedunderwriting.Itispromotingunifiedgrowth

strategiesutilizingboththeLloyd’smarketandCorporatemarketbusinessplatforms.

Property&liability

53.1%

Marine

16.0%

Reinsurance

7.5%

A&H

10.8%

Aviation

4.0%

Other

8.6%

Lloyd’s Premium

Composition

(Fiscal 2017)

Promote unified growth strategies using the business platforms

of Lloyd’s market and Corporate market under the competitive

underwriting conditions


2020Plans

158.0 158.0


(Billionsofyen)

CAGR approx. +4%

*2CAGRiscalculatedfromfiscal2018

projectionsbecausefiscal2017is0.Normalizedbasis


2020Plans

0

C/R 109%

95% 94% level

10.0


(Billionsofyen)

CAGR approx. +8%*2


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Reinsurance

Business Overview and Strategies in the New Mid-Term Business PlanTokioMillenniumReisthecoredriveroftheGroup’sreinsurancebusiness.

Underthenewmid-termbusinessplan,wewillpromotefurthergeographical

diversificationthroughglobalizationaswellasproductlinediversification

accompanyingbusinessexpansioninareasotherthannaturalcatastropherisk.

Inthisway,wewillaimtomakeastableprofitcontribution.

South&CentralAmerica

Business Overview and Strategies in the New Mid-Term Business PlanTokioMarineSeguradoraisatop-classinsurancecompany

inBrazilintheretailandcorporatefields.Itisaimingtogain

thetrustofcustomersandachievesustainablegrowthby

maintaininghigh-qualityoperationsandprovidingnew

productsandservicesthatmeetcustomers’needs.

Other

92%

Naturalcatastrophe

8%

Product Composition

(Fiscal2017)

Maintain stable profit by managing portfolio mix with increased

diversification

Continue profit growth by providing products and services that

meet customers’ expectations through operational excellence

HIM*2 net incurred losses in net premiums written

Average of

competing groups*3

*2AnacronymofhurricaneHarvey,Irma,andMaria,whichoccurredin

NorthAmericain2017

*3Arch,Aspen,AXIS,EverestRe,Markel,RenRe,Validus

5.9% 13.6%

Normalizedbasis


2020Plans

138.0

145.0


(Billionsofyen)


2020Plans

‒3.0

C/R 114% 99% 98% level

9.0


(Billionsofyen)

CAGR approx. +8%*1

CAGR approx. +1%

Normalizedbasis *1CAGRiscalculatedfromfiscal2018

projectionsbecausefiscal2017is

negative.


2020Plans

139.0 145.0


(Billionsofyen)


2020Plans

5.0 5.0

C/R 99% 100% 99% level


(Billionsofyen)



Achieve growth, mainly in the retail market, by expanding

distribution channels and creating a business model with

Group synergies at the core

Asia&theMiddleEast

Business Overview and Strategies in the New Mid-Term Business PlanTokioMarineAsiaisaregionalheadofficewiththeresponsibilityofbusinessmanagementandtechnicalsupportincluding

riskmanagementacrosstheregionwhereGroupcompaniesoperatein10countriesinAsia.Thecompanyalsoplansand

proposesnewbusinessestocapturegrowthpotentialandaimstosupportlifeandnon-lifebusinessexpansionandprofit

growthintheregion.

Worktobuildauniquebusinessmodelthatisunrivaledin

theindustrybyrollingoutthebestpracticesacrossthe

Group,implementingpersonnelexchanges,andutilizing

technology

Establishanewvalue-creatingmodelforJapanese

businesses

Expandagencynetworkandenhanceproductivity

Shifttocapitallightproducts

Achievefurtherprogresswithlifeandnon-lifecross-selling

businessmodelinAsia

LifeNon-life

Acquisition of Two Non-Life Insurance Companies in Asia

InJune2018,throughTokioMarine&Nichido,TokioMarineHoldingsannouncedthatithasenteredintoadefinitive

agreementtoacquirenon-lifeinsurancecompaniesinThailandandIndonesiafromInsuranceAustraliaGroupLimited,

anAustralianinsurancecompany,forapproximately42.8billionyen.Intheinternationalinsurancebusiness,theGroup

isaimingtopursueglobalgrowthopportunitiesandtheestablishmentofadiversifiedbusinessportfoliobystrength-

eningitsorganicgrowthpotentialandpromotingstrategicM&As.Inemergingmarketswherehighlevelsofgrowthare

expectedoverthemedium-to-longterm,keymeasureswillincludeexpandingscaleandprofitsandfosteringfurther

geographicaldiversification.

Throughtheacquisition,wewillbecomethenumberthreenon-lifeinsurancegroupinThailand,whichisthelargest

non-lifeinsurancemarketinSoutheastAsia.Movingforward,througharangeofinitiativeswewillworktoexpandthe

scaleandprofitsofourinternationalinsurancebusinessandcontributetothefurtherdevelopmentoftheinsurance

marketinThailand.


2020Plans

6.0*

2.0


(Billionsofyen)

CAGR approx. –8%

*Excludingtheimpactofinterestrate

fluctuationinfiscal2017,we

projectedaCAGRofaround+21%

towardfiscal2020plans.


2020Plans

12.0* 9.0

C/R 95% 99% 97% level


(Billionsofyen)

CAGR approx. +3%

*Excludingthetemporaryimpactof

reservetakedowninfiscal2017,we

projectedaCAGRofaround+11%

towardfiscal2020plans.


2020Plans

89.0 93.0


(Billionsofyen)

CAGR approx. +10%

Normalizedbasis


2020Plans

139.0 145.0


(Billionsofyen)

CAGR approx. +7%

Normalizedbasis

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Documents

Operations Section · As for business unit profits, FX ... 92.2% 91.3% 2017 2018 Projections 2020 ... technology and the progress of globalization, cyber