Ms&ad Insurance Group Holdings, Inc. · TSE:8725
Ms&ad Insurance — Investor Presentation (May 2021)
50 slides from Ms&ad Insurance's investor presentation, May 28, 2021
Slide 1: Fiscal 2021 First Information Meeting
Fiscal 2021 First Information Meeting May 28, 2021
Slide 2: Introduction: Looking Back on FY2020
Introduction: Looking Back on FY2020 FY2020 Results • Initiatives Aimed at Business Style Reforms • Due to the COVID-19 pandemic, we began FY2020 under an environment of uncertainty over the future outlook, but the MS&AD Insurance Group has been able to maintain the health of its employees and conti
Slide 3: I. Aspirations in 2030
Advancing with you INSURANCE GROUP. I. Aspirations in 2030 MS8AD Ins ice Group Holdings, Inc.
Slide 4: 1. Business Environment
1. Business Environment Economic Circumstances Future Business Evolution of Technology and Social Conditions Environment Slowdown of the domestic economy and sustained growth Rise of digital platform holders in developing economies in Asia and elsewhere Widespread adoption of IoT devices due t
Slide 5: The Vision of the MS&AD Group
２．The Vision of the MS&AD Group The Vision of the MS&AD Group A corporate group that supports a resilient and sustainable society • Taking the initiative in responding to climate change and contributing to the realization of a sustainable society. • Our brand recognition will be grained globally thr
Slide 6: Aspirations in 2030
３．Aspirations in 2030 Achieve a growth rate and capital efficiency appropriate for a “world-leading insurance and financial services group.” (¥bn) 500.0 Finance Profit Level 12.0% ROE (IFRS basis) ¥500.0 billion 12% 8.0% 8.5% 300.0 Reference: Profit level of global peers* 6.1% 233.1 6.7% 214.6 Pro
Slide 7: Growth Vision
４．Growth Vision Profit Level CSV × DX × Global (4) Create and generate revenue (3)＋(4) Results from new businesses Aiming for a profit of (3) Generate revenue in areas before and after 10.0 billion yen insurance coverage (“MS&AD Value Strategy”) (2) Expand international business foundations and inve
Slide 8: CSV × DX-based growth: Areas Before and After Insurance Coverage
5. CSV × DX -based growth (1) Achieving Profitability in the Areas Before and After Insurance Coverage (MS&AD Value Strategy) Inform and prevent Provide coverage Minimize Recover risks (protection) Impact quickly Pattern 1: Riders Example Mimamoru Automobile Accident emergency Safe driving support a
Slide 9: CSV × DX-based growth: Creating New Businesses
5. CSV × DX -based growth (2) Creating New Businesses and Achieving Profitability RisTech Telematics Data Business in the U.S. 1 Smart Mobility Storage of all DCM data Telematics Data Analysis Big data analysis Examples Distance driven Providing new safe Driving duration and time of day driv
Slide 10: Revision of Business Portfolio
6．Strengthening of Business Portfolio Management (1) Revision of Business Portfolio Revise the business portfolio to enhance capital efficiency Image of Revisions to the Business Portfolio Profit by business Financial services / Financ Risk-related services ial 2% servic International es / 30% Dome
Slide 11: Action Steps and Portfolio Management Perspectives
6． Strengthening of Business Portfolio Management (2) Action Steps and Portfolio Management Perspectives Action Steps Portfolio Management Perspectives Carry out improvement initiatives and the replacement of businesses in the interests of capital efficiency, growth potential and profit volatility Q
Slide 12: II. Progress of Vision 2021
Advancing with you INSURANCE GROUP. II. Progress of “Vision 2021” ati
Slide 13: Progress Toward Aspirations
１．Progress Toward Aspirations Our scale, financial soundness, and profitability are maintained at the target level. We will continuously strive to achieve the targets in terms of capital efficiency, portfolio diversity, and the share of strategic equity holdings. Vision 2021 (FY2018 - FY2021) Im
Slide 14: Progress Toward Numerical Management Targets and Forecasts
２. Progress Toward Numerical Management Targets and Forecasts Group Adjusted Profit for FY2021 is forecast to rise by 85.3 billion yen to 300.0 billion yen. Net income is expected to rise by 85.6 billion yen to 230.0 billion yen. (¥bn) FY2018 FY2019 FY2020 FY2021 Forecast Results Results Results V
Slide 15: Progress Toward Numerical Targets: Group Adjusted Profit and ROE
3. Progress Toward Numerical Management Targets and Forecasts Group Adjusted Profit and Group Adjusted ROE <Reference> Group Core Profit and Group ROE (¥bn) New Frontier 2013 Next Challenge 2017 Vision 2021 ■ Domestic Non-life ■ Domestic Life Insurance Business Group Adjusted ROE Insurance Business
Slide 16: Impact of COVID-19
４. Impact of COVID-19 Impact of COVID-19 (FY2020) The impact from incurred losses attributable to COVID-19 was ¥65.8 billion, an increase of ¥17.8 billion over the last earnings forecasts. The negative impact on asset management profit of ¥28 billion mostly ended up not occurring due to a recove
Slide 17: Domestic Non-Life Insurance Business: Current Status
5．Domestic Non-Life Insurance Business: Current Status Net Premiums Written*1 / Combined Ratio*2 Net Premiums Written (¥bn) Premium growth rate continuing at 116.1% Combined Ratio top industry level 2,824.7 2,840.9 2,853.0 Maintaining a strong top line 2,746.0 2,699.5 2,670.2 2,722.3 Accelerated
Slide 18: Domestic Life Insurance Business: Current Status
6．Domestic Life Insurance Business: Current Status Maintaining the level at ¥1.0 trillion. Annualized premiums of new policies Although the top line declined due to factors Gross Premiums Income including the impact of low worldwide interest 117.4 110.8 rates, a stable level of ¥1 trillion was mai
Slide 19: International Business: Current Status
7. International Business: Current Status Profit expansion phase from FY2021 Net Premiums Written*1 Over the past ten years, the top line has been significantly MS Amlin Lower premiums due to COVID-19 expanded through major acquisitions including MS Amlin and (¥bn) acquisition and stricter underwr
Slide 20: Three Key Strategies: Pursue Group's Comprehensive Strengths
8．Three Key Strategies: Pursue Group’s Comprehensive Strengths For domestic direct written premiums, we have achieved a top industry-level growth rate for three consecutive years. At the same time, we have realized significant productivity improvements. Through reviews of organizational personne
Slide 21: Three Key Strategies: Promote Digitalization
8. Three Key Strategies: Promote Digitalization We steadily promote digitization and roll out the CSV x DX strategy globally. Examples of Implementation Expansion through CSV x DX Providing Risk Solutions Before And After Coverage and Protection Position as core products and expand the product lin
Slide 22: Three Key Strategies: Reform the Portfolio
8．Three Key Strategies: Reform the Portfolio Regarding diversification of the business portfolio, we expect to achieve a level of approximately 50% in FY2021 excluding the domestic non- life business. On the reduction of strategic equity holdings, we achieved the target of ¥500.0 billion (FY2017
Slide 23: CSV Initiatives ①
9． CSV Initiatives ① We will spread CSV initiatives throughout the Group. We will also achieve Group-wide growth by providing products and services that solve the seven key issues. Seven Key Issues for CSV Examples of CSV Initiatives Dealing with New Risks Developing and Providing Products That Ad
Slide 24: CSV Initiatives ②
9． CSV Initiatives ② 事故のないモビリティ社会を作る Create mobility society without accidents Contribute to climate change mitigation and adaptation Providing Products and Services that Lead to Solutions Providing Products and Services that Lead to Solutions Telematics automobile insurance Comprehensive compen
Slide 25: CSV Initiatives ③
9． CSV Initiatives ③ Strive for resilient community development Support “good health and longevity” Providing Products and Services that Lead to Solutions Providing Products and Services that Lead to Solutions Health and Productivity Management Support Insurance Support for events such as local
Slide 26: III. Topics
Ⅲ. Topics 1. Cost reductions 2. Profitability Improvement in Fire Insurance 3. Profit Recovery in International Business 4. Global Governance 5. Business Investment Policy 6. Reducing Interest Rate Risks at MSI Aioi Life 7. Responding to Climate Change
Slide 27: III. Topics
Ⅲ. Topics 1. Cost reductions 2. Profitability Improvement in Fire Insurance 3. Profit Recovery in International Business 4. Global Governance 5. Business Investment Policy 6. Reducing Interest Rate Risks at MSI Aioi Life 7. Responding to Climate Change
Slide 28: Cost Reductions: Improvement of Expense Ratio
１． Cost reductions (1) Improvement of Expense Ratio The initial forecast of expense ratio for the non-life insurance business was 35.1% (+2.0 percentage points over the previous fiscal year) due to the impact of system depreciation, increase in consumption tax, declining CALI revenue and revenue d
Slide 29: Cost Reductions: Business Style Reforms
１． Cost reductions (2) Business Style Reforms Steady progress has been made with cost reductions through business style reforms, and a decrease of ¥34.0 billion was achieved for FY2020. Building upon these plans, we will aim to achieve cumulative cost reductions of ¥100 billion by the end of FY2
Slide 30: III. Topics
Ⅲ. Topics 1. Cost reductions 2. Profitability Improvement in Fire Insurance 3. Profit Recovery in International Business 4. Global Governance 5. Business Investment Policy 6. Reducing Interest Rate Risks at MSI Aioi Life 7. Responding to Climate Change
Slide 31: Profitability Improvement in Fire Insurance
2. Profitability Improvement in Fire Insurance We will make steady progress on initiatives to improve the profitability of the fire insurance business and enter into the black during the next medium-term management plan. Outlook for Improving Profitability of Fire Insurance (¥bn) Fire Insurance Un
Slide 32: III. Topics
Ⅲ. Topics 1. Cost reductions 2. Profitability Improvement in Fire Insurance 3. Profit Recovery in International Business 4. Global Governance 5. Business Investment Policy 6. Reducing Interest Rate Risks at MSI Aioi Life 7. Responding to Climate Change
Slide 33: International Business: Towards Medium-to-Long-Term Growth
3. International Business (1) Towards Medium-to-Long-Term Growth Next Medium-Term Management Plan Increase Profit to ¥100-125 Billion Inorganic Growth Creation of New Business Fields USA Asia Generate profit in new Specialty insurance market, Stronger Position business fields such as US MGA,InsurTec
Slide 34: MS Amlin (Measures for profit recovery)
３． International Business (2) MS Amlin (Measures for profit recovery) The positive effects of efforts to recover profitability, such as withdrawal of unprofitable products, rate increases, and improved terms have steadily emerged. The Non Cat risk loss rate at the end of 2020 improved year-on-year
Slide 35: Asian Business
３．International Business (3) Asian Business We will steadily grow profits in the Asian business and drive development of the international business as a whole. From 2022 onwards, we will capture market growth, boost earnings power, develop the retail market and pursue Group synergy to achieve cont
Slide 36: Growth of International Life Insurance Business
３． International Business (4) Growth of International Life Insurance Business In FY2020, some of our investments recorded losses due to a decline in the price of their assets from the impact of COVID-19, but in FY2021 that impact will be lessened, and we expect profit levels to improve. Medium-to-L
Slide 37: Efforts and Results Following Reorganization of the International Business
3. International Business (5) Efforts and Results Following Reorganization of the International Business Vision 2021 Stage 2 FY2022 onwards Efforts to improve earnings, enhance operating efficiency and boost organizational strength in light of reorganization of the international business have proc
Slide 38: Efforts Aimed at Synergy
3. International Business (6) Efforts Aimed at Synergy The Group is producing synergistic efforts across various fields with each overseas Group company and affiliated global insurance companies. Coordination with Group Companies Spreading Sales Expertise and Digitalization Utilizing the respect
Slide 39: III. Topics
Ⅲ. Topics 1. Cost reductions 2. Profitability Improvement in Fire Insurance 3. Profit Recovery in International Business 4. Global Governance 5. Business Investment Policy 6. Reducing Interest Rate Risks at MSI Aioi Life 7. Responding to Climate Change
Slide 40: Global Governance
4. Global Governance Strengthen governance framework of overseas businesses through their restructuring Strengthen governance by having specialized departments at head office take part in meetings organized by head office overseas departments and by dispatching head office officers and employees t
Slide 41: III. Topics
Ⅲ. Topics 1. Cost reductions 2. Profitability Improvement in Fire Insurance 3. Profit Recovery in International Business 4. Global Governance 5. Business Investment Policy 6. Reducing Interest Rate Risks at MSI Aioi Life 7. Responding to Climate Change
Slide 42: Business Investment Policy
5. Business Investment Policy We will make disciplined business investments to improve capital efficiency. Strengthen: Investment to strengthen the competitiveness of existing businesses • We will carry out investments that demonstrate a strong awareness of ROI, including investments aimed at promo
Slide 43: Business Investment Policy: M&A Support
5．Business Investment Policy In April 2021, a dedicated team was established within the holding company to strengthen support functions for reviewing and promoting Group M&A activities. M&A Strategy Formulation Phase Deal Review and Execution Phase PMI and Post M&A Phase Business Investment Promoti
Slide 44: III. Topics
Ⅲ. Topics 1. Cost reductions 2. Profitability Improvement in Fire Insurance 3. Profit Recovery in International Business 4. Global Governance 5. Business Investment Policy 6. Reducing Interest Rate Risks at MSI Aioi Life 7. Responding to Climate Change
Slide 45: Reducing Interest Rate Risks at MSI Aioi Life
6. Reducing Interest Rate Risks at MSI Aioi Life By expanding investment in ultra-long-term bonds, we will promote comprehensive asset and liability management (ALM) and aim to establish a stable portfolio that is not affected by interest rate fluctuations. • There is a difference in the interest r
Slide 46: III. Topics
Ⅲ. Topics 1. Cost reductions 2. Profitability Improvement in Fire Insurance 3. Profit Recovery in International Business 4. Global Governance 5. Business Investment Policy 6. Reducing Interest Rate Risks at MSI Aioi Life 7. Responding to Climate Change
Slide 47: Responding to Climate Change
7. Responding to Climate Change In FY2021, we will revise the MS&AD Group’s CO2 emission reduction targets and promote TCFD disclosures. Achieving Net Zero by 2050 - The Group’s current reduction targets of CO2 emission were revised with the aim of achieving net zero by 2050. - We will work with st
Slide 48: IV. Shareholder Return
UEEKSRURR. INSURANCE GROUP IV. Shareholder Return MS8&AD Insurance Group Holdings, Inc.
Slide 49: Shareholder Return Policy and Shareholder Return for FY2020
Shareholder Return Policy and Shareholder Return for FY2020 For FY2020, the annual dividend is planned at ¥155. In addition, share buybacks of up to ¥15 billion will be implemented. For FY2021, the annual dividend is forecast at ¥160. Shareholder Return Policy Provide shareholder return based on s
Slide 50: Total Shareholder Return per share, Total Yield, and Dividend Yield
Total Shareholder Return per share, Total Yield, and Dividend Yield Total Shareholder Return per share, Total Yield, and Dividend Yield DPS 6.9% 6.7% Return through purchase of own shares per share 5.7% Total yield 5.4% Dividend yield 4.8% 5.0% 4.8% 4.2% 3.9% 3.9% 3.7% (¥) 3.2% 3.4% 3.4% 217.0 3.0%
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