Outline of the interim settlement and result forecast for FY2005 - - PowerPoint PPT Presentation

1 1 1 1

Outline of the interim settlement and result forecast for FY2005

December 2, 2005

・Amounts shown herein are basically rounded off. ・Amounts are shown after excluding refundable premium of our original automobile insurance “Modo-rich.”

651 651 651 651 658 658 658 658 674 674 674 674 6.6 6.6 6.6 6.6 1.0 1.0 1.0 1.0 2.5 2.5 2.5 2.5 600 600 600 600 620 620 620 620 640 640 640 640 660 660 660 660 680 680 680 680

(FY)03interim 04interim 05interim

0.0 0.0 0.0 0.0 1.0 1.0 1.0 1.0 2.0 2.0 2.0 2.0 3.0 3.0 3.0 3.0 4.0 4.0 4.0 4.0 5.0 5.0 5.0 5.0 6.0 6.0 6.0 6.0 7.0 7.0 7.0 7.0

Net Premiums Written Increase Rate

Net premiums written Net premiums written

Increased by 2.5％ ％ ％ ％ from previous year. All lines except CALI secured premium increase.

2 2 2 2

(%)

*CALI = Compulsory Automobile Liability Insurance

(bil yen)

Net loss ratio Net loss ratio *

*

3 3 3 3

(%)

Rose by 2.8pt. to 57.6% due to increased payment for CALI and Auto.

57.6 57.6 57.6 57.6 53.1 53.1 53.1 53.1 51.8 51.8 51.8 51.8 54.8 54.8 54.8 54.8

55.0 55.0 55.0 55.0 56.4 56.4 56.4 56.4 55.2 55.2 55.2 55.2 54.7 54.7 54.7 54.7

50 50 50 50 53 53 53 53 56 56 56 56 59 59 59 59

02interim 03interim 04interim 05interim

* *Net loss ratio=(Net claims paid+Loss adjustment expenses)/Net pr Net loss ratio=(Net claims paid+Loss adjustment expenses)/Net premiums written emiums written

excluding the effect of abolition of reinsurance to government r excluding the effect of abolition of reinsurance to government related to CALI elated to CALI including the effect of abolition of reinsurance to government r including the effect of abolition of reinsurance to government related to CALI elated to CALI

Net operating expense ratio* Net operating expense ratio*

4 4 4 4

Improved by 0.6pt. due to increase on premiums and reduced in personnel expenses.

(%)

31.1 31.1 31.1 31.1 32.0 32.0 32.0 32.0 34.1 34.1 34.1 34.1 30.5 30.5 30.5 30.5

34.5 34.5 34.5 34.5 33.5 33.5 33.5 33.5 32.7 32.7 32.7 32.7 35.3 35.3 35.3 35.3

30 30 30 30 32 32 32 32 34 34 34 34 36 36 36 36

02interim 03interim 04interim 05interim

*Net operating expense ratio = Underwriting expenses/Net premiums written

including the effect of abolition of reinsurance to government r including the effect of abolition of reinsurance to government related to CALI elated to CALI excluding the effect of abolition of reinsurance to government r excluding the effect of abolition of reinsurance to government related to CALI elated to CALI

Combined ratio* Combined ratio*

5 5 5 5

Rose by 2.2pt. from the previous year due to an increase in net loss ratio.

(%)

88.1 88.1 88.1 88.1 87.2 87.2 87.2 87.2 83.8 83.8 83.8 83.8 85.9 85.9 85.9 85.9

90.3 90.3 90.3 90.3 89.1 89.1 89.1 89.1 88.7 88.7 88.7 88.7 89.2 89.2 89.2 89.2

81 81 81 81 84 84 84 84 87 87 87 87 90 90 90 90 93 93 93 93

02interim 03interim 04interim 05interim

*Combined ratio = Net loss ratio + Net operating expense ratio

including the effect of abolition of reinsurance to government r including the effect of abolition of reinsurance to government related to CALI elated to CALI excluding the effect of abolition of reinsurance to government r excluding the effect of abolition of reinsurance to government related to CALI elated to CALI

Introduction of New Rule of Underwriting Introduction of New Rule of Underwriting Reserves related to natural disaster Reserves related to natural disaster

• 1. Unearned Premiums

Tested adequacy of Unearned Premiums for Fire based on new rule. The amount of Unearned Premiums is sufficient for the level of expected now. To realize the above for 10 years, we implement following two measures.

• Reserve 9% of net premiums for Fire yearly. ( 6.8% in FY2004)
• Reserve additional Yen 23.4 bil. this FY recognized as extraordinary

losses.

6 6 6 6

• 2. Catastrophic Loss Reserve

Plan to improve the amount of Catastrophic Loss Reserve for Fire from Yen 113.7 billion, current level, up to Yen 300 billion, sufficient level for the provision against the estimated losses by the natural disaster which incurs once in 70 years.

35.9 35.9 35.9 35.9 ▲ 23.7 ▲ 23.7 ▲ 23.7 ▲ 23.7 20.4 20.4 20.4 20.4 ▲ 40 ▲ 40 ▲ 40 ▲ 40 ▲ 20 ▲ 20 ▲ 20 ▲ 20 20 20 20 20 40 40 40 40 03interim 04interim 05interim

Underwriting profit Underwriting profit

7 7 7 7 Increased Yen 44.2 bil. from the previous year due to the decrease of damage caused by natural disasters.

(bil yen)

24.4 24.4 24.4 24.4 30.5 30.5 30.5 30.5 23.8 23.8 23.8 23.8 28.9 28.9 28.9 28.9 26.6 26.6 26.6 26.6 28.7 28.7 28.7 28.7

20 40 60 80

03interim 04interim 05interim

Investment Income Credited to Investment Deposits by Policyholders Net Interest and Dividend Income

Interest and dividend income Interest and dividend income

8 8 8 8

Gross interest and dividend income raised by 2.6 bil yen. Net interest and dividend income also raised by 2.8 bil yen. 5 5 . 3 5 5 . 3 5 5 . 3 5 5 . 3 5 4 . 9 5 4 . 9 5 4 . 9 5 4 . 9

Gross interest and dividend income

5 2 . 7 5 2 . 7 5 2 . 7 5 2 . 7

(bil yen)

77.3 77.3 77.3 77.3 ▲ 5 ▲ 5 ▲ 5 ▲ 5 16.7 16.7 16.7 16.7 ▲ 6 ▲ 6 ▲ 6 ▲ 6 31.1 31.1 31.1 31.1 ▲ 8 ▲ 8 ▲ 8 ▲ 8 ▲ 20 20 40 60 80 03interim 03interim 03interim 03interim 04interim 04interim 04interim 04interim 05interim 05interim 05interim 05interim

Net Realized Gain Net Realized Gain Net Realized Gain Net Realized Gain Devaluation Loss Devaluation Loss Devaluation Loss Devaluation Loss

9 9 9 9

Net realized gain and devaluation loss of securities Net realized gain and devaluation loss of securities Net realized gain raised by 14.4 bil. yen from the previous year. Devaluation loss increased by 1.6 bil. Yen.

(bil yen)

1 1 1 1

Extraordinary Income/Losses Extraordinary Income/Losses

FY 04interim FY 05interim

Impairment loss on fixed assets

Others

Extraordinary income / losses total

Yen -20.7 bil

Recognized 23.4 bil yen catastrophic loss reserve as an extraordinary loss in accordance with the new rule of Underwriting Reserves related to natural disaster

Yen -0 bil Yen 0.8 bil Yen 32.9 bil Price fluctuation reserve Yen -1.4 bil

Gain related to employee pension fund liabilities

• Yen -10.7 bil

Yen 6.4 bil Yen -3.3 bil Yen 40.5 bil

Catastrophic loss reserve

Yen -23.4 bil

• Shift to the defined contribution

annuity

Yen 3.4 bil

1 1 1 1 1 1 1 1

Ordinary profit Ordinary profit・ ・ ・ ・ ・ ・ ・ ・Net Income Net Income

129.4 79.2 10.5 26.9 71.1 34.9

40 80 120 160

03interim 04interim 05interim

Ordinary Profit Net Income

Both ordinary profit and net income raised due to the decrease

• f damage caused by natural disasters.

(bil yen)

• Net Premium

Written Increase Amount Increase Rate Group

738.5 738.5 738.5 738.5 25.9 25.9 25.9 25.9 3.6 3.6 3.6 3.6

Parent

674.2 674.2 674.2 674.2 16.1 16.1 16.1 16.1 2.5 2.5 2.5 2.5

Sub- sidiaries

64.3 64.3 64.3 64.3 9.7 9.7 9.7 9.7 17.9 17.9 17.9 17.9

Net Premium Written Increase Amount Increase Rate Asia

14.0 7.8 125.6

Europe

27.7 0.2 1.0

Americas

15.0 ▲ ▲ ▲ ▲ 1.1 ▲ ▲ ▲ ▲ 7.3

Reinsurance Subsidiaries

7.4 2.8 61.9

Consolidated net premiums written Consolidated net premiums written

Increased by 3.4% from the previous year. Overseas insurance subsidiaries recognized premium increase contributed mainly by Asian subsidiaries. 1 2 1 2 1 2 1 2

< <Excl

• Excl. refundable premium of

. refundable premium of “ “Modo Modo-

• rich

rich” ”> >

（ （ （ （bil yen,％） ％） ％） ％）

（ （ （ （bil yen,％） ％） ％） ％）

Mitsui Sumitomo Mitsui Sumitomo Kirameki Kirameki Life Insurance Life Insurance

1 3 1 3 1 3 1 3 Steadily performed new business, Amount of in-force business maintained double-digit growth rate. Proforma net income raised double.

Amount of new business

(FY) 05 interim

Change from the previous 1st half

Yen 841.6 bil

▲ ▲ ▲ ▲6.5%

Proforma net income* Yen 2.14 bil

Amount of in-force business

Yen 7,367.0 bil

+ 15.8%

Net income Yen 0.04 bil

(Previous 1st half) 0.05 bil yen (Previous 1st half) 1.08 bil yen

Premium income Yen 95.3 bil

+ 13.5%

（The above is total sum of individual insurance and individual annuity） *Hypothetical net income before extra reserve for Net level premium method of valuation provided.

1 4 1 4 1 4 1 4

Mitsui Sumitomo Mitsui Sumitomo Metlife Metlife Insurance Insurance

Amount in-force expanded to 1,218.3 bil yen,

• r 1.4 times of end of FY 2004.

(FY) 05 interim

Yen 229.7 bil

Net loss

Yen - 2.6 bil Yen 1,218.3 bil Premium income Yen 262.2 bil

Change from the previous year

+ + + + Yen 35.5 bil

1.4times of end of FY2004

+ + + + Yen 42.1 bil + + + + Yen 3.5 bil

Amount of new business Amount of in-force business

（The above includes fixed annuity）

1 5 1 5 1 5 1 5

Consolidated net income Consolidated net income

133 81 14.4 28.3 72.3 33.6

40 80 120 160

03interim 04interim 05interim

Ordinary Income Net Income

Consolidated ordinary profit jumped up to Yen 72.3 bil. Consolidated net income also increased by Yen 5.3 bil.

Net Income FY05interim Asia

2.1

Europe

0.2

Americas

• 0.1

Reinsurance Subsidiaries

0.1

Total Overseas

2.3

Life Insurance

• 1.2

Financial Services

0.3

*Before the consolidation adjustments

(bil yen)

Net Income for Subsidiaries (bil yen)

Result forecast for FY2005 Result forecast for FY2005 ◆ ◆ ◆ ◆ ◆ ◆ ◆ ◆Precondition Precondition◆ ◆ ◆ ◆ ◆ ◆ ◆ ◆

Exchange rate (Yen/USD) Yen 107.39

(FY) 04

Yen 110

05 (est.)

Rate of interest (10 years JGB)

1.52% 1.55%

Stock price (Nikkei 225) Yen 11,669 Yen 13,500

1 6 1 6 1 6 1 6

05 interim

Yen 113.19 1.32% Yen 13,574 * Exchange rate, Stock price : As of March 31, 2005, September 30, 2005, and March 31, 2006. Rate of interest : Average during each term

1,310.2 1,310.2 1,310.2 1,310.2 1,336.0 1,336.0 1,336.0 1,336.0 1.3 1.3 1.3 1.3 2.0 2.0 2.0 2.0 1,200.0 1,220.0 1,240.0 1,260.0 1,280.0 1,300.0 1,320.0 1,340.0 2004 2004 2004 2004 2005(Est.) 2005(Est.) 2005(Est.) 2005(Est.) 0.0 0.0 0.0 0.0 0.5 0.5 0.5 0.5 1.0 1.0 1.0 1.0 1.5 1.5 1.5 1.5 2.0 2.0 2.0 2.0 2.5 2.5 2.5 2.5 3.0 3.0 3.0 3.0

Net Premiums Written Increase Rate

Result forecast for FY2005 Result forecast for FY2005 ◆ ◆ ◆ ◆ ◆ ◆ ◆ ◆Net premiums written Net premiums written◆ ◆ ◆ ◆ ◆ ◆ ◆ ◆

(%)

1 7 1 7 1 7 1 7

Forecast 2.0% increase due to the good shape of fire and

• ther P & C, growing for 6 consecutive years.

(bil yen)

（Ref.）excluding the effect of abolition of reinsurance to government related to CALI （Ref.）excluding CALI

2004 2005（est.) Net premiums written 1,219.3 1,246.0 Increase rate 1.4% 2.2% 2004 2005（est.) Net premiums written 1,114.5 1,142.9 Increase rate 1.4% 2.5%

783.7 783.7 783.7 783.7 750.4 750.4 750.4 750.4 64.0 64.0 64.0 64.0 60.4 60.4 60.4 60.4 600.0 600.0 600.0 600.0 650.0 650.0 650.0 650.0 700.0 700.0 700.0 700.0 750.0 750.0 750.0 750.0 800.0 800.0 800.0 800.0 2004 2004 2004 2004 2005(Est.) 2005(Est.) 2005(Est.) 2005(Est.) 50.0 50.0 50.0 50.0 55.0 55.0 55.0 55.0 60.0 60.0 60.0 60.0 65.0 65.0 65.0 65.0 70.0 70.0 70.0 70.0 Net Claims Paid Net Loss Ratio

Results forecast for FY2005 Results forecast for FY2005

◆ ◆ ◆ ◆ ◆ ◆ ◆ ◆Net Net loss loss ratio ratio◆ ◆ ◆ ◆ ◆ ◆ ◆ ◆

(%)

Forecast 3.6pt improvement to 60.4%

1 8 1 8 1 8 1 8

(bil yen)

（Ref.）excluding the effect of abolition of reinsurance to government related to CALI （Ref.）excluding CALI

2004 2005（est.) Net Claims Paid 731.5 678.5 Net Loss Ratio 64.5% 59.0% 2004 2005（est.) Net Claims Paid 670.6 619.4 Net Loss Ratio 64.2% 58.2%

263.5 263.5 263.5 263.5 265.0 265.0 265.0 265.0 31.3 31.3 31.3 31.3 30.9 30.9 30.9 30.9

250.0 260.0 270.0 280.0

2004 2004 2004 2004 2005(Est.) 2005(Est.) 2005(Est.) 2005(Est.)

30 31 32 33 34 35

Operating,General and Administrative Expenses and Loss Adjustment Expenses Net Operating Expense Ratio

Results forecast by for FY2005 Results forecast by for FY2005

◆ ◆ ◆ ◆ ◆ ◆ ◆ ◆Net Net operating expense

• perating expense ratio

ratio◆ ◆ ◆ ◆ ◆ ◆ ◆ ◆

Forecast 0.4pt improvement to 30.0% range.

1 9 1 9 1 9 1 9

(%)

(bil yen)

（Ref.）excluding the effect of abolition of reinsurance to government related to CALI （Ref.）excluding CALI

2004 2005（est.) Net Operating Expense Ratio 33.7% 33.1% 2004 2005（est.) Net Operating Expense Ratio 34.0% 33.3%

60.8 60.8 60.8 60.8 116.0 116.0 116.0 116.0 95.3 95.3 95.3 95.3 91.3 91.3 91.3 91.3 0.0 20.0 40.0 60.0 80.0 100.0 2004 2004 2004 2004 2005(Est.) 2005(Est.) 2005(Est.) 2005(Est.) 85 87 89 91 93 95 97 Underwriting Balance Combined Ratio

Result forecast for FY2005 Result forecast for FY2005 ◆ ◆ ◆ ◆ ◆ ◆ ◆ ◆Combined ratio Combined ratio◆ ◆ ◆ ◆ ◆ ◆ ◆ ◆

Forecast 4.0 pt improve to 91.3% due to reduction of net loss ratio and net operating expense ratio.

2 2 2 2

(bil yen)

(%)

（Ref.）excluding the effect of abolition of reinsurance to government related to CALI （Ref.）excluding CALI

2004 2005（est.) Underwriting Balance 22.1 98.0 Combined Ratio 98.2% 92.1% 2004 2005（est.) Underwriting Balance 20.2 96.1 Combined Ratio 98.2% 91.5%

36.9 45.3 ▲ ▲ ▲ ▲ 13.9 38.5

• 30
• 20
• 10

10 20 30 40 50 60

2002 2002 2002 2002 2003 2003 2003 2003 2004 2004 2004 2004 2005(Est.) 2005(Est.) 2005(Est.) 2005(Est.)

Result forecast for FY2005 Result forecast for FY2005 ◆ ◆ ◆ ◆ ◆ ◆ ◆ ◆Underwriting profit Underwriting profit◆ ◆ ◆ ◆ ◆ ◆ ◆ ◆

Forecast 38.5 bil yen rise by 52.4 bil yen from the previous year

2 1 2 1 2 1 2 1

(bil yen)

51.4 51.4 51.4 51.4 65.4 65.4 65.4 65.4 54.5 54.5 54.5 54.5 59.8 59.8 59.8 59.8 51.9 51.9 51.9 51.9 58.5 58.5 58.5 58.5 64.4 64.4 64.4 64.4 56.9 56.9 56.9 56.9 20 40 60 80 100 120 140

2002 2002 2002 2002 2003 2003 2003 2003 2004 2004 2004 2004 2005(Est.) 2005(Est.) 2005(Est.) 2005(Est.)

Investment Income Credited to Investment Deposits by Policyholders Net Interest and Dividend Income

116.8 114.3 121.3 110.4

Result forecast for FY2005 Result forecast for FY2005 ◆ ◆ ◆ ◆ ◆ ◆ ◆ ◆Interest and dividend income Interest and dividend income◆ ◆ ◆ ◆ ◆ ◆ ◆ ◆

Forecast Yen 12.5bil increase of net interest and dividend income to Yen 64.4 bil. 2 2 2 2 2 2 2 2

(bil yen)

Gross interest and dividend income

Results forecast for FY2005 Results forecast for FY2005 ◆ ◆ ◆ ◆ ◆ ◆ ◆ ◆Realized Realized gain (net) gain (net)・ ・ ・ ・ ・ ・ ・ ・Devaluation loss of Devaluation loss of securities securities◆ ◆ ◆ ◆ ◆ ◆ ◆ ◆

29.9 29.9 29.9 29.9 51.3 51.3 51.3 51.3 37.8 37.8 37.8 37.8 74.5 74.5 74.5 74.5

• 7.7
• 7.7
• 7.7
• 7.7
• 4.4
• 4.4
• 4.4
• 4.4
• 1.5
• 1.5
• 1.5
• 1.5
• 50.2
• 50.2
• 50.2
• 50.2
• 70
• 50
• 30
• 10

10 30 50 70 90

2002 2002 2002 2002 2003 2003 2003 2003 2004 2004 2004 2004 2005(Est.) 2005(Est.) 2005(Est.) 2005(Est.)

Realized Gain(net) Devaluation Loss

Forecast Yen 37.8 bil realized gain (net), Yen 7.7bil of devaluation loss.

2 3 2 3 2 3 2 3

(bil yen)

Results forecast for FY2005 Results forecast for FY2005

◆ ◆ ◆ ◆ ◆ ◆ ◆ ◆Ordinary Ordinary profit profit・ ・ ・ ・ ・ ・ ・ ・Net income Net income◆ ◆ ◆ ◆ ◆ ◆ ◆ ◆

Forecast Yen 124.0bil of ordinary profit, Yen 64.0bil of net income.

47.6 32.3 166.5 72.9 79.3 60.7 124.0 64.0 50 100 150 200

2002 2002 2002 2002 2003 2003 2003 2003 2004 2004 2004 2004 2005(Est.) 2005(Est.) 2005(Est.) 2005(Est.)

Ordinary Profit Net Income

2 4 2 4 2 4 2 4

(bil yen)

69 89 93 125

1,319 1,383 1,403 1,461

50 100 150 2002 2002 2002 2002 2003 2003 2003 2003 2004 2004 2004 2004 2005(Est.) 2005(Est.) 2005(Est.) 2005(Est.) 500 700 900 1,100 1,300 1,500

Subsidiaries Net Premium Written Consolidated Net Premiums Written

Results forecast for FY2005 Results forecast for FY2005

◆ ◆ ◆ ◆ ◆ ◆ ◆ ◆Consolidated net premiums written Consolidated net premiums written◆ ◆ ◆ ◆ ◆ ◆ ◆ ◆

Forecast 4.1% up to Yen 1,461.0 bil. Overseas subsidiaries grow with Asian expansion.

2 5 2 5 2 5 2 5

(bil yen) (bil yen)

（Ref.）excluding CALI 2002 2003 2004 2005(Est.) Consolidated Net Premium Written 1,253 1,292 1,312 1,371

Results forecast by the end of FY2005 Results forecast by the end of FY2005

◆ ◆ ◆ ◆ ◆ ◆ ◆ ◆Consolidated subsidiaries segment information

Consolidated subsidiaries segment information◆

◆ ◆ ◆ ◆ ◆ ◆ ◆

Asia

42.6 +2.1

Change from the previous year

Europe

27.1 13.7

Americas

▲ ▲ ▲ ▲0.1 41.4 +28.9 ▲ ▲ ▲ ▲1.8

05(Est.)

Change from the previous year

05(Est.)

4.5 ▲ ▲ ▲ ▲0.5 2.0 ▲ ▲ ▲ ▲0.8 ▲ ▲ ▲ ▲3.9

Reinsurance Subsidiaries

Net Premiums Written Net Income

+5.0 ▲ ▲ ▲ ▲2.6 ▲ ▲ ▲ ▲2.8

2 6 2 6 2 6 2 6

125.0 ▲ ▲ ▲ ▲5.1

Total Overseas Subsidiaries

+32.0 3.2

Life Insurance Companies

▲ ▲ ▲ ▲2.8 ▲ ▲ ▲ ▲1.8

Financial Services

0.5 +0

(bil yen)

Forecast both net premiums written and net income grow in Asia due to acquisitions of Aviva operations and Mingtai

Results forecast for FY2005 Results forecast for FY2005

◆ ◆ ◆ ◆ ◆ ◆ ◆ ◆Consolidated net income Consolidated net income◆ ◆ ◆ ◆ ◆ ◆ ◆ ◆

49.5 87.5 130.0 174.9 32.8 77.7 66.0 65.7 1.03 1.08 1.07 1.01 0.0 50.0 100.0 150.0 200.0 250.0 300.0 2002 2003 2004 2005(Est.) 0.90 0.95 1.00 1.05 1.10 Consolidated Ordinary Profit Consolidated Net Income Group-to-Parent Ratio

Forecast Yen 130.0bil of consolidated ordinary profit, and Yen 66.0bil of consolidated net income.

2 7 2 7 2 7 2 7

(bil yen)

【 【 【 【Cautionary Statement】 】 】 】 Any statements about Mitsui Sumitomo Insurance Co., Ltd.’s future plans, strategies, and performance contained in this material that are not historical facts are meant as, or should be considered as, forward- looking statements. These forward-looking statements are based on the Company’s assumptions and

• pinions in the light of the information currently available to it. The Company wishes to caution readers

that a number of uncertain factors could cause actual results to differ materially from those discussed in the forward-looking statements. Such factors include, but are not limited to, (1) general economic conditions in the Company’s markets, (2) competitive conditions in the insurance business, (3) fluctuations

• f foreign exchange rates, and (4) government regulations, including changes in the tax rates.