AM Best Affirms Tokio Marine & Nichido Fire Insurance Co., Ltd.’s Credit Ratings and its US subsidiaries

HONG KONG–(BUSINESS WIRE)–AM Best affirmed the Financial Strength Rating (FSR) of A++ (Superior) and the Long-Term Issuer Credit Rating (Long-Term ICR) of ‘aa+’ (Superior) of Tokio Marine & Nichido Fire Insurance Co., Ltd. (TMNF) (Japan) and its US subsidiaries. The outlook for these credit ratings (ratings) is stable. (See below for a detailed list of US subsidiaries.)

The ratings reflect TMNF’s strong balance sheet, which AM Best rates as the strongest, as well as its strong operating results, very favorable business profile and very strong enterprise risk management (ERM).

TMNF’s balance sheet strength rating reflects its risk-adjusted capitalization, which is at its strongest as measured by Best’s Capital Adequacy Ratio (BCAR). In addition to significant solvency capital of ¥5 trillion (US$41 billion), this valuation is also supported by the company’s low financial leverage.

TMNF has a track record of strong operating results, supported primarily by strong premium growth and a five-year average return on equity of 8.4% (fiscal year 2017 – 2021) calculated on a comprehensive income basis. In its domestic market, TMNF continues to have a consistently strong and significant non-life business with an average five-year combined ratio of approximately 95.6% (fiscal years 2017-2021), excluding its compulsory motor liability business. TMNF’s international business also saw strong growth in net premiums written (NPW) across markets, while the bottom line saw a significant improvement due to better profitability and strong investment income in fiscal 2021.

TMNF continues to maintain a diversified business profile with operations spanning various markets and lines of business. In Japan, it maintains a leading position with a market share of over 25% in terms of NPW. It continued to lead its domestic competitors in all major lines of business in terms of NPW volume in fiscal 2021. Over the past decade, TMNF has successfully built a high-quality book of overseas insurance business with its disciplined M&A strategy, which now accounts for approximately 35 % of its NPW. AM Best believes that TMNF’s leading domestic market position and significant international business profile will continue to help it weather challenging market conditions while growing earnings over the medium to long term.

The company continues to have a sophisticated ERM framework that is embedded throughout its organization. AM Best believes TMNF’s ERM program is very effective in managing the group’s exposure to potential earnings and capital volatility.

The stable outlook reflects AM Best’s expectation that TMNF will maintain its overall balance sheet valuation, supported by risk-adjusted capitalization at the strongest level measured by BCAR, while maintaining strong performance in its domestic non-life business and developing its overseas insurance business in a reasonable manner in the interim.

Negative rating actions may occur if there is a material deterioration in risk-adjusted capitalization, such as significant investment losses caused by investment volatility or large-scale natural disasters. Negative rating actions could also occur if there is a significant deterioration in Tokio Marine Holdings, Inc.’s credit profile, including its risk-adjusted capitalization, financial leverage or interest coverage levels.

FSRs of A++ (Superior) and long-term ICRs of ‘aa+’ (Superior), each with a stable outlook, have been affirmed for the following subsidiaries of Tokio Marine & Nichido Fire Insurance Co., Ltd.:

  • Tokio Marine America Insurance Company

  • Trans Pacific Insurance Company

  • Specialized insurance company TM

  • TNUS Insurance Company

Ratings are communicated to rated entities prior to publication. Unless otherwise stated, ratings have not changed since this announcement.

This press release refers to the credit ratings that are published on the AM Best website. For all rating information relating to the release and related disclosures, including details of the agency responsible for issuing each of the individual ratings mentioned in this release, please see AM Best’s web page for recent rating activities. For further information on the use and limitations of credit score opinions, please see Best’s Guide to Credit Scores. For information on the proper use of Best’s credit ratings, Best’s performance ratings, Best’s preliminary credit ratings, and AM Best’s press releases, please see the Guide to the Proper Use of Best’s Ratings and Ratings.

AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit

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