Tokio Marine : IFRS and ICS Implementation Overview

Published September 30, 2025 at 6:41 a.m. UTC

Source: MarketScreener

Tokio Marine Insights:IFRS and ICS Implementation Overview

September 30, 2025

Table of Contents

– IFRS Overview	・・・・・・	20
– Group Accounting Policy	・・・・・・	21
– Insurance Accounting Impact	・・・・・・	22
– Financial Instruments Accounting Impact	・・・・・・	23
– Combined Ratio Definition	・・・・・・	24
– CSM	・・・・・・	25
– Implementation Timeframe	・・・・・・	26
– KPI definition	・・・・・・	27
– Glossary	・・・・・・	28

Highlights (Reference) Definitions, etc.

– Key Messages	・・・・・・	2
– Executive Summary	・・・・・・	3

Impacts of IFRS and ICS Implementation

– Business Unit KPIs	・・・・・・	10
– Japan P&C Business	・・・・・・	11
– Japan Life Business	・・・・・・	12
– International Business	・・・・・・	13
– Net Income impact and reconciliation
to Adjusted Net Income	・・・・・・	15
– Net Asset impact	・・・・・・	16
– PER・PBR Impact	・・・・・・	17
– ESR Impact	・・・・・・	18

Abbreviations used in the material:

P&C: Property & Casualty
TMNF: Tokio Marine & Nichido Fire Insurance
TMNL: Tokio Marine & Nichido Life Insurance

PHLY :Philadelphia Insurance

DFG :Delphi Financial Group

TMHCC :Tokio Marine HCC

TMK :Tokio Marine Kiln

TMSR :Tokio Marine Seguradora

Key Messages

New KPIs enhance comparability with global peers

The implementation of IFRS from FY2026 aims to enhance our transparency and comparability with global peers through a transition from financial accounting-based JGAAP to an economic value-based accounting in line with ERM
New KPIs will reflect our capabilities accurately and emphasize comparability with global peers
Adjusted Net Income under IFRS is estimated to increase to approx. JPY805.0bn*1 in FY2024 and is forecasted to be JPY840.0bn*1 in FY2025, compared to the profit under JGAAP*2 (excluding gains from sales of business-related equities). Going forward, profit is expected to be less volatile under new KPI
Adjusted ROE under IFRS is approx. 12.8%*1,3 in FY2024 and is forecasted to be approx. 13%*1,3 in FY2025

*1: Pre-audit basis (same applies to subsequent pages)

*2: Adjusted Net Income under the current definition (excluding gains from sales of business-related equities) is JPY608.9bn in FY2024 and is forecasted to be JPY700.0bn in FY2025

*3: Adjusted ROE under the current definition (excluding gains from sales of business-related equities) is 11.4% in FY2024 and is

forecasted to be 13.2% in FY2025

DPS growth in line with Top-tier EPS growth

The 3-year average of IFRS Adjusted Net Income will be applied as the source of dividends starting from FY2026
Even though gains from the sales of business-related equities will no longer be included in Adjusted Net Income after the implementation of IFRS, DPS Growth in line with Top-tier EPS Growth will be maintained continuously through the sustainable expansion of the source of dividends, which is average Adjusted Net Income

Disciplined capital policy remains unchanged

Share Buyback will be implemented flexibly, based on the level required to approximately boost EPS growth by +2%, while comprehensively taking into account market conditions, the M&A pipeline, and other factors
ESR will be redefined considering comparability with global peers and alignment with the new economic value-based solvency regulations. New ESR will be treated as an indicator of financial soundness, with a target set at "190% or higher”
Capital will be reinvested into core business with higher profitability and risk-taking to achieve further profit growth and raise ROE. In the absence of attractive investment opportunities, the enhancement of shareholder return will be considered

Adjusted Net Income and Adjusted ROE, the new KPIs post-IFRS implementation are designed to reflect our capability accurately and emphasize comparability with global peers

Executive Summary: New KPI Definition

IFRS Adjusted Net Income = IFRS Net Income - Capital Gains/Losses - ALM & Hedge-Related Gains/Losses - Business Investment Related Gains/Losses

Key Differences

Gains/losses from sales of business-related equities not included

Insurance liabilities evaluated on the economic value basis

Capital gains/losses not included

IFRS Adjusted ROE =

IFRS Adjusted Net Income

IFRS Net Assets - Unrealized Gains/Losses (AOCI)

Key Differences

Numerator: described as above

Denominator: Assets and liabilities evaluated on the economic value basis

Numerator: described as above

Denominator: Unrealized gains/losses related to financial assets and insurance liabilities excluded

Denominator: Goodwill and intangible assets included

FY2024 Actual

1,215.0

+196

IFRS Adjusted Net Income is raised compared to the current definition (excl. gains form sales of business-related equities) due to the impact of insurance liabilities evaluated on the economic value basis in Japan P&C / Life and the exclusion of capital gains/losses
Profit is expected to be less volatile compared to the current definition due to the exclusion of capital gains/losses going forward

Executive Summary: Adjusted Net Income

(billions of JPY)

Accounting Standard Differences

Change in Definition

Approx.

805.0

Current Definition

-606.1

Derecognition of gains from sales of business-related equities

608.9

Current Definition

+140

FY2025 Forecast

1,100.0

Accounting Standard Differences

Change in Definition

Approx.

840.0

700.0

-400.0

Derecognition of gains from sales of business-related equities

+75.0

Insurance liabilities evaluated on economic value basis

±0

Timing differences*etc.

+65.0

Excl. Capital gains/losses

(Excl. Gains from sales of business-related equities)

+70.0

Insurance liabilities evaluated on economic value basis

-14.0

Timing differences*etc.

+140.0

Excl. Capital gains/losses

IFRS

Adjusted Net Income

Current Definition

(Excl. Gains from sales of business-related equities)

IFRS

Adjusted Net Income

*: Currently, our group financials fiscal year runs from April to March, while overseas entities’ financials runs from January to December. Under IFRS, the time differences will be resolved, and the fiscal year is unified from April to March for the group