Lifenet Insurance Company · TSE:7157
Lifenet Insurance — Q3 2024 Earnings Presentation
42 slides from Lifenet Insurance's earnings presentation, Feb 12, 2025
Slide 1: Presentation Material for Investors Third Quarter for Fiscal 2024
Securities Code: 7157 TSE Growth Presentation Material for Investors Third Quarter for Fiscal 2024 February 12, 2025
Slide 2: Cumulative 3Q for Fiscal 2024 Key Highlights
Cumulative 3Q for Fiscal 2024 Key Highlights Key Indicators Corporate Value Growth Profitability Comprehensive Equity1 Annualized premium2 Insurance service (CE) of policies-in-force results ¥ 165,229mn ¥ 33,348mn ¥ 7,193mn (YoY 105.8%) (YoY 119.6%) (YoY 114.6%) Notable Achievements ◼ Ranked No.1 in
Slide 3: Annualized Premium of Policies-in-Force
Annualized Premium of Policies-in-Force ◼ Resulted in ¥33,348mn and achieved significant growth of 19.6% YoY YoY :AP1 of policies-in-force for GCL2 (JPY millions) :AP1 of policies-in-force for individual life (JPY millions) ¥ 33,348mn +19.6％ Group credit 27,872 6,914 life insurance 2,877 Individual
Slide 4: Policies-in-Force Movement
Policies-in-Force Movement ◼ Despite individual life being sluggish, GCL continued steady growth :Net increase of AP of policies-in-force for GCL (JPY millions) Premium rate :Net increase of AP of policies-in-force for individual life (JPY millions) revision in Jul.2024 Net increase of Net increase
Slide 5: Summary IFRS P/L
Summary IFRS P/L ◼ Insurance service results and net income resulted in ¥7,193mn and ¥4,956mn, respectively (JPY millions) FY2023/3Q FY2024/3Q Items (YTD) (YTD) Change Insurance service results 6,275 7,193 918 Financial results1 276 (67) (343) Other results (335) (241) 93 Profit before tax 6,215 6,8
Slide 6: Insurance Service Results
Insurance Service Results1 ◼ Progress steadily at 80.8% of business forecasts Progress rate :Insurance service results (fiscal year, JPY millions) for the business :Insurance service results (3QYTD, JPY millions) Business forecasts forecasts 8,900 8,222 2 80.8％ 7,216 2 ￥7,193ｍn 2 6,606 6,618 YoY ＋14
Slide 7: Insurance Service Results Analysis
Insurance Service Results Analysis ◼ Achieved profit growth of 14.6% YoY by CSM release and GCL results Insurance (JPY millions) service results Items FY2023/3Q FY2024/3Q Change Insurance 7,193 (YTD) (YTD) service results Results from Expected claims minus incurred CSM release 594 179 (414) 6,275 GC
Slide 8: New Management Indicator “Comprehensive Equity”
New Management Indicator “Comprehensive Equity” ◼ Having changed our management indicator from EEV to “Comprehensive Equity” based on IFRS, aim to achieve ¥200-240bn in FY2028 European Embedded Value（EEV） Comprehensive Equity (CE) Conceptually similar GCL contracts value1 CSM2 （after-tax） Value of i
Slide 9: Movement of Management Indicators
Movement of Management Indicators ◼ Strongly growing at a CAGR of 19% since IPO Comprehensive European Embedded Value（EEV）1 Equity (CE) ¥1,991 ¥2,057 : EEV (JPY millions) ¥1,788 159,802 165,229 10,228 : GCL contracts value (JPY millions) 6,709 : CSM after tax (JPY millions) : IFRS Equity (JPY millio
Slide 10: Changing Factors of Comprehensive Equity (CE)
Changing Factors of Comprehensive Equity (CE) ◼ Increased due to GCL contracts value and net income, though affected by rising interest rates Equity movement (JPY millions) Other movement CE GCL Net income attributable to 70 165,229 Other CSM (after tax) movement movement owners comprehensive of the
Slide 11: Progress of GCL
Progress of GCL Rebranding Tech & Services Embedded ◼ Aim to further contribute to key indicators with the launch of new product, GCL for joint mortgage in January 2025 au Jibun Bank’s rapid growth of mortgage loan Contribution to key indicators (as of Dec. 2024) Nov. 2024 10,228mn Jun. 2024 ¥5.0tn
Slide 12: Position as the Leading Player: No.1 Online Life Insurance
Position as the Leading Player Rebranding Tech & Services Embedded ◼ Leading online life insurer ranked No.1 in life insurance overall as well Achieved the overall No.1 ranking Oricon® Customer Satisfaction Survey1 for the third time Life Insurance • Application Procedure Overall No.1 • • Product Co
Slide 13: New Product Launch
New Product Launch Rebranding Tech & Services Embedded ◼ Newly launched "Term" medical insurance successfully reaching younger generations Launched in Oct. 2024 Number of new policies by age group1 % of under 30s “Term” medical 定期医療 34% 34% 18% 11% 3% 68％ Whole-life 終身医療 medical 19% 23% 27% 22% 9% 4
Slide 14: Progress in Partner Business
Progress in Partner Business Rebranding Tech & Services Embedded ◼ Promoting collaboration with partners with a large customer base, strong brand and rich data Started to offer "Insurance with V-points“ Improved UX in the app to to a new customer base from Feb. 20253 strengthen service for insurance
Slide 15: Improvement of Capital Market Evaluation
Improvement of Capital Market Evaluation ◼ Maintain P/CE ratio of 1.0x as a base, and further improve capital market evaluation Stock price / CE per share (P/CE) Drivers for improvement Adopt corporate value • Changed indicator from "EV" to indicators linked to IFRS-based "CE" 2.00 ¥1,9401 2,000 IFR
Slide 16: Consolidated Business Forecasts for FY2024
Consolidated Business Forecasts for FY2024 ◼ Remains unchanged while corporate tax rate change may temporarily reduce net income by ¥600-700mn and CE by ¥1.5-2.0bn (See page 21) Growth Profitability (JPY millions) (JPY millions) AP of policies-in-force Business forecasts Insurance service results Bu
Slide 17: FY2024-2028 Mid-term Business Plan
FY2024-2028 Mid-term Business Plan Growth Strategy Goals in Fiscal 2028 Priority Areas Management Goal Comprehensive Equity (CE) : ¥200-240bn Rebranding Embedded Financial Targets 中期計画 Stock price：¥3,000+ Annual growth rate of CE per share： Tech & Services approx. 10% Non-financial Targets (Human ca
Slide 18: Achieving Mid-term Business Plan ¥200-240bn
Achieving Mid-term Business Plan ◼ Aim to achieve Comprehensive Equity of ¥200-240bn in FY2028 by realizing sustainable growth through investment in priority areas Fiscal 2025 ¥200-240bn CE growth image Aim for TSE Prime Market Goals in Fiscal 2028 Stock price 159 1241 133 ¥3,000+ Annual growth rate
Slide 19: LIFENET Manifesto
LIFENET Manifesto Comprehensible, Cost-Competitive, Convenient I. Our Guiding Principles II. Making Life Insurance Accessible Again - Headache-free (1) Creating the future of the life insurance without losing sight of its original (1) Helping the customers help themselves. By making our materials ea
Slide 20: https://ir.lifenet-seimei.co.jp/en/
All information on this document that is not historical fact constitutes forward-looking information and is based on assumptions and forecasts available to the company at the time of preparation. The company cannot guarantee the accuracy of these assumptions and forecasts. Earnings projections and o
Slide 21: Appendix
Appendix
Slide 22: Impact of Change in the Effective Corporate Tax Rate
Impact of Change in the Effective Corporate Tax Rate ◼ If the special defense corporation tax is introduced in the Diet, the effective statutory tax rate is expected to rise from 28.0% to 28.9% ◼ While an impact on performance at the end of March 2025 is expected, it is temporary and only for this p
Slide 23: Glossary
Glossary 1 Glossary Explanation Revenue accrued for fulfillment of insurance services. Mainly, expected claims, expected maintenance expenses, risk Insurance revenue adjustment release, CSM release and recovery of insurance acquisition cash flows. Investment components which will be paid regardless
Slide 24: Glossary
Glossary 2 Glossary Explanation An indicator defined by the Group. It is the sum of “Equity (attributable to owners of the Company)” on the IFRS balance sheets, “CSM”, a liability representing unearned profit that the Group expects to earn as it provides insurance services Comprehensive Equity (insu
Slide 25: Breakdown of Policies-in-Force
Individual life Breakdown of Policies-in-Force Component 2023/12 2024/12 ratio Number of policies-in-force 590,097 626,146 100% - Term Life 288,013 304,831 49% - Whole-life Medical & Term Medical 161,384 171,163 27% - Long-term Disability 69,074 71,263 11% - Cancer 64,378 71,812 11% - Other1 7,248 7
Slide 26: Annualized Premium / Number of New Business
Individual life Annualized Premium / Number of New Business :AP1 of new business (JPY millions) :Number of new business 1,166 1,123 1,137 1,104 1,051 991 981 969 934 933 923 889 820 747 734 675 689 681 639 29,864 28,136 27,553 26,918 26,167 24,410 23,928 23,369 22,506 22,612 22,164 22,128 20,934 16,
Slide 27: Surrender and Lapse Ratio
Individual life Surrender and Lapse Ratio :Surrender and lapse ratio1（%） 7.6% 7.1% 6.9% 6.8% 6.6% 6.6% 6.4% 6.4% 6.4% 6.3% 6.3% 6.3% 6.0% 6.1% 5.9% 5.5% 5.5% 5.6% 5.4% 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q FY2020 2020年度 FY2021 2021年度 FY2022 2022年度 FY2023 2023年度 FY2024 2024年度 1. Th
Slide 28: Insurance Acquisition Cash Flows (IACF) Efficiency
Individual life Insurance Acquisition Cash Flows (IACF) Efficiency :Insurance acquisition cash flows / AP of new business :Insurance acquisition cash flows per new business (JPY thousands) Fiscal year1 Quarter 150 129 135 138 137 121 105 3.5 118 3.7 3.4 3.4 97 3.3 3.1 3.0 82 2.7 2.4 2.0 (fiscal year
Slide 29: Operating Expenses Ratio
Operating Expenses Ratio1 :Operating Expenses Ratio（％） :Operating expenses excl. insurance acquisition cash flows (JPY millions) Fiscal year2 Quarter 20.7% 17.8% 19.4% 18.9% 18.6% 16.9% 18.4% 17.8% 16.7% 16.1% 4,935 4,715 3,896 3,973 3,047 1,280 1,337 1,215 1,294 1,463 (fiscal year) 2020 ’21 ’22 ’23
Slide 30: Summary IFRS P/L (Quarter)
Summary IFRS P/L (Quarter) (JPY millions) Items 2023/3Q 2023/4Q 2024/1Q 2024/2Q 2024/3Q Note Insurance service results 2,186 1,947 2,340 2,224 2,628 Expected claims minus incurred Increased due to a decrease in claims1 331 189 46 (19) 153 claim payments for individual life Risk adjustment release 39
Slide 31: Breakdown of Insurance Service Results
Breakdown of Insurance Service Results (JPY millions) FY2023 FY2024 Items （Ref.）Fiscal Year 3Q(YTD) 3Q(YTD) Insurance revenue 24,698 18,087 22,041 Expected claims 10,464 7,788 8,276 Risk adjustment release 1,678 1,270 1,196 CSM release 7,056 5,191 5,542 Recovery of IACF 3,647 2,687 3,062 Others (150
Slide 32: Impact from Rising Interest Rates
Impact from Rising Interest Rates ◼ Impact on Comprehensive Equity and net income is limited Impact on corporate value & net income • CE：Sensitivity to interest rate changes in IFRS equity is limited due to protection type products line-up (See page 36 for details) • IFRS-based net income：By shorten
Slide 33: Breakdown of Financial Results
Breakdown of Financial Results ◼ Decreased by exchange loss while interest income rose due to increased foreign securities (JPY millions) Items FY2023/3Q(YTD) FY2024/3Q(YTD) Change Investment results 371 (16) (387) Interest income 272 716 444 Impairment losses on financial assets, net (3) (4) (1) Ot
Slide 34: Detail of Bond Portfolio
Detail of Bond Portfolio1 As of December 31, 2024 (JPY millions) Available-for-Sale Held-to-Maturity Total JPY Bonds 16,858 33,993 50,851 Duration2 4 years 7 years 6 years Foreign Currency Bonds 11,063 — 11,063 Duration2 4 years Non-Currency Hedged — — — Currency Hedged 11,063 — 11,063 1. Based on J
Slide 35: CSM Movement
CSM Movement ◼ Decreased due to slower growth in new business CSM for individual life and assumption changes (JPY millions) FY2024/3Q Impact of Items FY2023 (YTD) Interest assumption New business accretion changes, etc. CSM, CSM 716 106 Amortization CSM, beginning of the period 83,604 92,173 beginni
Slide 36: CSM Future Allocation
CSM Future Allocation ◼ Stable profits will be realized over long period from in-force CSM ◼ Aim for CSM release growth by adding CSM generated from future acquired new business Future allocation of CSM (JPY billions) Expected timing when CSM is recognized in PL Amount A+year 6 A+year 1 A＋year 2 A＋y
Slide 37: Comprehensive Equity Sensitivity Analysis
Comprehensive Equity Sensitivity Analysis1 ◼ Impacts of changes in assumptions (sensitivities) Changes in Comprehensive Equity (CE) as of December 31, 2024 Of which Changes in CE % changes changes in CSM2 (JPY millions) Comprehensive Equity as of December 31, 2024 165,229 ー 60,621 0.5% increase in r
Slide 38: Changing Factors of EEV
Changing Factors of EEV1 (JPY millions) Expected Operating Assumption existing experience Adjustments changes business variances to the values3 159 837 152,137 contribution as of Dec. 31, 2024 1,247 70 Economic variances and assumption Value of changes new business (842) 3,674 146,991 Adjusted incre
Slide 39: Solvency Margin Ratio Calculation
Solvency Margin Ratio Calculation As of December 31, 2024 ( (𝑅 1 + 𝑅 8 )2 + (𝑅 2 + 𝑅 3 + 𝑅 7 )2 + 𝑅 4 )/2 (JPY millions) = Solvency margin ratio Total amount of solvency margin Total amount of risk/2 1,701.6％ <numerator> ÷ < the denominator> 【Ref.】 42,959 Consolidated 5,049/2 Solvency margin…
Slide 40: IFRS Reporting
IFRS Reporting ◼ IFRS adoption better presents periodic performance and profitability from policies-in-force ◼ Capital adequacy and dividends are regulated by statutory accounting standards (J-GAAP) Statutory Accounting Embedded Value IFRS 17 （J-GAAP） Economic value of Recognition of revenue Financi
Slide 41: Summary J-GAAP P/L & B/S
Summary J-GAAP P/L & B/S (JPY millions) (JPY millions) FY2023/3Q FY2024/3Q Items FY2023 Items FY2023 FY2024/3Q (YTD) (YTD) Ordinary income 35,964 26,038 30,952 Total assets 84,194 88,023 Insurance premiums 34,264 24,933 30,489 Cash and deposits 20,009 12,842 and other Ordinary expenses 40,634 29,269
Slide 42: Dividend Policy
Dividend Policy ◼ Aim for the increase in total shareholder return by capital gain1 Profit Policies-in-force & profit and loss（illustrative image） : Policies-in-force : New business : J-GAAP profit and loss Retained earnings are realized after generating profit Marketing expenses are recorded in lum
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