Growth Strategy in Asian Business

Hideyuki Tanaka Managing Executive Officer

Mitsui Sumitomo Insurance Company, Limited

October 15, 2019

Agenda

2

Toyota retail Telematics / Mobility

Asia

MS Amlin

Reinsurance at HO

International Non-Life Insurance

International Life Insurance

International Business of

MS&AD Group

The International Business of MS&AD Group consists of the “International Non-Life Insurance Business” and the “International Life Insurance Business”. Today’s presentation is focused on “the Asian Business“ of the International Non-Life Insurance Business segment.

Europe and Americas

1. Features of the Group’s Asian Business 2. Growth Potential and Challenges in the Asian

Insurance Market 3. Current Situation of the Asian Business and Outlook 4. Growth Strategies

(1) Improvement of Profitability (2) Retail Market (3) Commercial Market and Infrastructure Business (4) Emerging Countries

5. Looking ahead to the Future of Asia ＜Appendix＞ Changes in the Combined Ratio

1. Features of the Group’s Asian Business

3

Ever since the Group expanded into the Thai market in 1934, we have been building the network that enable to provide the insurance products to all countries in ASEAN region on the stable business foundation. Now the Group has established its strong presence in Asia.

Wide Customer Base

built through 85 years of operation 180,000 corporate customers,

1.53 million individual customers

Strong Presence

Ranked first in terms of premiums written in the ASEAN region*

Network covering the Entire Area ・A network of local companies and branches in all

ASEAN member states that can provide direct insurance ・Alliances with major local partners

Diversified Portfolio Breakdown of GWP in Asia (2018)

No. 2

No. 3

MS&AD 176 billion yen

A (Japan) 146 billion yen

B (France) 98 billion yen

No. 1

Note : * Total premiums written in six major countries (Singapore, Malaysia, Thailand, Indonesia, The Philippines, and Vietnam).

Channels ** Note :**Excluding The Philippines, Laos,

Myanmar, South Korea and Sri Lanka

Brokers, 30%

Agencies, 24%

Direct,13%

Other 11%

Bancassu-rance11%

Dealers, 11%

Classes

Graph1

自動車自動車自動車自動車自動車

火災火災火災火災火災

その他その他その他その他その他

マリンマリンマリンマリンマリン

賠償責任賠償責任賠償責任賠償責任賠償責任

医療医療医療医療医療

農業農業農業農業農業

GWP

AUS

NEZ

除くｵｾｱﾆｱGWP

自動車 火災 その他 マリン 賠償責任 医療 農業

Auto, 44%

Fire,23%

Other,12%

Marine, 9%

Casualty,5%

Medical,5%

Agri,2%

0.4355790544

0.2273266953

0.1203989845

0.0874186099

0.0537445575

0.0538290725

0.0217030259

Sheet1 (2)

グラフ1グラフ2(百万円） ヒャクマンエングラフ3

国別割合GWP種目別GWPAUSNEZ除くｵｾｱﾆｱGWP割合販売チャネル別GWP割合

インド34.3%71,046火災Property59,1641,91153156,72230.8%ブローカーBroker83,16148.5%端数

シンガポール30.9%63,978自動車Motor56,0034993955,46530.2%端数代理店Agent36,21321.1%

マレーシア20.4%42,220その他others28,2393,4342924,77613.5%直販Direct26,48215.4%

タイ16.1%33,357マリンMarine21,1272792020,82811.3%ディーラーAgent Dealer11,7226.8%

中国11.3%23,337賠償責任Liability16,0353214115,6738.5%バンカシュアランスBancassurance10,8666.3%

香港7.8%16,173医療Healthcare10,519- 010,5195.7%その他(再保険含む)Others(incled RI)3,2481.9%

インドネシア5.8%12,020端数191,0876,444660183,983100.0%171,692100.0%

フィリピン5.8%11,922

ベトナム1.9%3,940中国現法中国現法

その他0.2%368＜種目別＞ シュモクベツ（通貨：億円） ツウカオクエン＜チャネル別＞ ベツ

100.0%207,315種目別火災 カサイ41.424142.14164販売チャネル別 ハンバイベツ直販 チョクハン616,086.83

マリン24.442443.70382ブローカー292,863.49

賠償責任 バイショウセキニン16.381637.76381代理店 ダイリテン2241.19

船舶11.811180.69518その他（受再） タウサイ14114,145.08

自動車 ジドウシャ129.1512915.22584合計23323,336.60

その他 タ10.171017.10428

ミャンマー0.0%57合計 ゴウケイ233.3723336.63457

ラオス0.2%311

インド現法インド現法

＜種目別＞ シュモクベツ（通貨：億円） ツウカオクエン＜チャネル別＞ ベツ

＜2018年度グロス保険料ベース内訳数値＞ ネンドホケンリョウウチワケスウチ種目別 シュモクベツ自保賠償314.54480.1031454.4チャネル別 ベツバンカシュアランス20020,000.00

自保車両165.5516555.2ディーラー10610,600.00

医療44.004400代理店 ダイリテンSMO（リテール代理店） ダイリテン12024824,800.00

マリン12.001200CIFCO89- 0

火災42.46174.374246.4法人代理店 ホウジンダイリテン39- 0

傷害45.604560その他 タ農業 ノウギョウ7015615,600.00

農業69.906990.4不明（差額） フメイサガク86- 0

その他 タ16.401640合計 ゴウケイ71071,000.00

合計 ゴウケイ654.46710.4671046.4

割合GWP明台 ミンタイ

ブローカー32.4%91,9995,975

合算GWP割合明台 ミンタイ代理店23.8%73,83612,581

自動車140,29744%23,907.3その他(再保険含む)11.4%35,2032,210

火災73,22023%8,109.9直販13.3%41,2218,652

その他38,78012%6,786.6ディーラー10.6%32,79110,469

マリン28,1579%2,504.6バンカシュアランス11.2%34,7063,840

賠償責任17,3115%0100.0%309,75643,727

医療17,3385%2,419.0

農業6,9902%0

322,093100%43,727.3

明台産物 アカダイサンブツ

＜種目別＞ シュモクベツTWD（千） セン（通貨：億円） ツウカオクエン（通貨：百万円） ツウカヒャクマンエンW/T＜チャネル別＞ ベツTWD（千） セン（通貨：百万円） ツウカヒャクマンエン

種目別 シュモクベツ自賠責 ジバイセキ1,033,14137.83,781.38.6%チャネル別 ベツ自動車ＤＬ ジドウシャ2,860,32610,46923.9%

自保任意 ジタモツニンイ5,498,904201.320,126.046.0%社員2,176,9207,96818.2%

火災2,215,81281.18,109.918.5%銀行1,049,2303,8408.8%

マリン684,30425.02,504.65.7%個人代理店3,437,56812,58128.8%

工事 コウジ300,75911.01,100.82.5%WEB187,0976851.6%

傷害・医療 イリョウ660,92524.22,419.05.5%ブローカー1,632,4915,97513.7%

その他 タ1,553,50556.95,685.813.0%その他603,7182,2105.1%

合計 ゴウケイ11,947,350437.343,727.3100.0%合計 ゴウケイ11,947,35043,727100.0%

@3.66

Sheet1 (2)

GWP

AUS

NEZ

除くｵｾｱﾆｱGWP

割合 44% 23% 12% 9% 5% 5% 2%

Sheet1

GWP

AUS

NEZ

除くｵｾｱﾆｱGWP

自動車 火災 その他 マリン 賠償責任 医療 農業

医療,5.3%

GWP

AUS

NEZ

除くｵｾｱﾆｱGWP

34.3% 30.9% 20.4% 16.1% 11.3% 7.8% 5.8% 5.8% 1.9% 0.2%

[CATEGORY NAME], [VALUE]

[CATEGORY NAME], [VALUE]

グラフ1グラフ2グラフ3

国別GWP割合種目別GWPAUSNEZ除くｵｾｱﾆｱGWP割合販売チャネル別GWP割合

シンガポール63,97834.8%火災Property59,1641,91153156,72230.8%ブローカーBroker83,16148.5%端数

マレーシア42,22022.9%自動車Motor56,0034993955,46530.2%端数代理店Agent36,21321.1%

タイ33,35718.1%その他others28,2393,4342924,77613.5%直販Direct26,48215.4%

香港16,1738.8%マリンMarine21,1272792020,82811.3%ディーラーAgent Dealer11,7226.8%

インドネシア12,0206.5%賠償責任Liability16,0353214115,6738.5%バンカシュアランスBancassurance10,8666.3%

フィリピン11,9226.5%医療Healthcare10,519- 010,5195.7%その他(再保険含む)Others(incled RI)3,2481.9%

ベトナム3,9402.2%端数191,0876,444660183,983100.0%171,692100.0%

その他3680.2%

183,978100.0%

ミャンマー570.0%

ラオス3110.2%

GWP

割合

[CATEGORY NAME], [VALUE]

GWP

AUS

NEZ

除くｵｾｱﾆｱGWP

割合

[CATEGORY NAME], [VALUE]

[CATEGORY NAME], [VALUE]

GWP

割合

[CATEGORY NAME], [VALUE]

2. Growth Potential and Challenges in the Asian Insurance Market

4

Both GDP and population are expanding in Asia resulting in considerable growth potential. Meanwhile, we have to improve profitability within the severe business environment due to tightening of regulations and intensifying competition.

Growth Potential in the Asian Insurance Market

etc.

Liberalization of premium rates

Strengthening of supervision and

regulations (RBC, money laundering,

IFRS, etc.)

Intensifying competition

Worsening asset management environment

(falling interest rates, etc.)

Frequent occurrences of

natural catastrophes

Business Environment in the Asian Insurance Market

Challenge : Improvement of Profitability

Source：United Nations / World Population Prospects 2019 Source：The World Bank / Global Economic Prospects (June 2019)

3. Current Situation of the Asian Business and Outlook

5

Net premiums written has been growing steadily as a result of organic business expansion, the acquisition of MS First Capital, other M&A and their synergies resulting from M&A.

(100 million yen)

（年度） (Fiscal Year)

Trend in Net Premiums Written

Graph1

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

・・・

2021

CAGR 9.2%

1171

1228

1441

1839

1985

2157

1996

2215

2439

2592

3092

Sheet1

20101,171

20111,228

20121,441

20131,839

20141,985

20152,157

20161,996

20172,215

20182,439

20192,592

・・・

20213,092

2010201120122013201420152016201720182019・・・2021

11711228144118391985215719962215243925923092

Sheet1

Sheet2

Sheet3

Leading Company In Asia

(Forecast) (Plan)

3. Current Situation of the Asian Business and Outlook

6

Growing steadily aiming to become a leading company in Asia

(100 million yen)

（年度）

Expected Net Income in Vision 2021 Period

Note;* Including special factors

* (Fiscal Year)

• Sustain No1 position

in ASEAN region • Build high presence in

all countries in Asia

• Contribute to development of region /society

• Establish credible

brand, rooted in region

Chart1

2017

2018

2019（計画）

2021（見通し）

Net Income

97

299

184

257

Sheet1

Net Income

2010

2011

2012

2013163

2014260

2015127

2016167

201797

2018299

2019（計画） ケイカク184

2021（見通し） ミトオ257

The Growth Driver for the International Business

4. Growth Strategies

7

・Promote initiatives for improvement of profitability as our challenge ・Capture “growth bonus” of population increase and economic expansion with the power of “the MSIG brand”

Retail Market

Pursue strengths and improvement of profitability

Emerging Countries

Tap into growing markets

Collaboration with platformers

Bancassurance

Major local companies

International projects

Digital Solutions

Pursue Group’s Comprehensive Strengths

Alliance with Major Local Partners

and Additional Investments

Commercial Market and Infrastructure

Business Efforts in unexplored fields

Pan-Indian Ocean Economic Zone

Future growth in markets

Improvement of Profitability Through initiatives in improvement of efficiency and cost reduction

8

4. Growth Strategies (1) Improvement of Profitability

Accelerate initiatives for improving profitability. This will be achieved by our know-how and our key strengths stemming from the Head Office and our Group Companies

Outline of the Initiative for Improving Profitability

Examples of initiatives for Automobile Insurance

Effect on Net Profit

Improvement of Loss Ratio

Prudent Underwriting

Appropriate Payment of Insurance Claims

Efficient Claims Handling

Efficient Sales Operations

Revision of rate/discount Revision of U/W guidelines

Video Chat

Utilize RPA Sales support systems for car dealers

Improvement of COR by 2% PAT increase of JPY3Bil in Asia

Enhancement of accuracy in checking repair costs

Improvement of Expense Ratio

9

Singapore

Tokyo

Silicon Valley

GDH Tokyo

Promote Digitalization through Global Digital Hub (GDH) Singapore, cooperating with GDH Tokyo and MS&AD Ventures in Silicon Valley

・Find and invest into Startups with cutting-edge technologies ・Co-operation/Alliance with MS&AD group companies

GDH Singapore ・Pursue Digitalization in the retail market ・Address market features such as mobile popularization and the increase of digital native

・Promote open innovation ・Develop innovative products/services ・Promote digitalization and educate staff regarding digital knowledge

Block Chain

Robotics Big Data

AI

Utilize Startups which MS&AD invested

Utilize Digital Solution

4. Growth Strategies (2) Retail Market

4. Growth Strategies (2) Retail Market

10

Promote initiatives based on a strong business base in ASEAN countries utilizing digital solutions

Collaborations with Platformers Bancassurance

(Asian countries) Sell insurance products in collaboration with major ride-sharing companies.

(Indonesia, Thailand, Vietnam)

• Online Sales System • Built-in Connect for insurance

marketing, etc.

Digital Solutions

Alliances with major local banks

• The Philippines • Malaysia • India • Vietnam, etc.

AI Assistant (Sales support system using AI)

Built-in Connect (Digital platform for insurance sales)

RisTech (Base for analysis of big data)

e.g. Bank employees’ support of over-the-counter sales of insurance

products in bancassurance

e.g. Incorporate sales of insurance products into mobile applications of

partner banks and for EC

e.g. Analytical customer data base on their bank loans to seek opportunities

to sell insurance products

4. Growth Strategies (3) Commercial Market and Infrastructure Business

11

Collaboration with MS First Capital and MS Amlin Collaboration with Head Office

• Strengthen underwriting capabilities in collaboration with MS First Capital and MS Amlin as well as collaboration with Head Office

• Promote initiatives for infrastructure projects with the development of Asian economy

Pursue Group’s Comprehensive Strengths

Underwriting Capacity Underwriting Expertise MS&AD Global Network

Launch to sell products of Head Office(Credit, Weather, etc.) in Asia

Utilize Group’s U/W Capacity

Propose Global Insurance Programs to Asian Companies, etc.

Promote initiatives for underwriting related to large projects (chemical plants, etc.)

Expand Specialty Insurance marketing. (D&O, Cyber, etc.)

Utilize U/W know-how of MS First Capital for other group companies in Asia, etc.

12

4. Growth Strategies (4) Emerging Countries

Sri Lanka 2015: Invested in Ceylinco 2018: Additional investment, application

of the equity method

Growth potential in Indian Ocean economic zone

Market share is approx. 20% (largest financial group in the country)

MSI invested in the life insurance field as well.

Sri Lanka: Global logistics hub One third of the container vessels and half of the oil tankers in the world are expected to pass off the coast of the country.

2020 2040 Population: 2.6Bil 3Bil

GDP: 9% of global GDP 12%

Exports: 11% of global exports 16%

Partner

Note; Source: A 2013 study on the logistics infrastructure development project (Indian Ocean economic zone examination project) of the industry adapting to the earth’s environment and using technologies in Japan (March 2014, the Ministry of Economy, Trade and Industry)

India

2016: Increased capital contribution ratio 2018: Second among the Company’s

overseas bases, following MS Amlin, in terms of premium volume

Major financial group in India Wide-ranging operations in

southern India

Partner

Myanmar

Have one of the widest network of bases in Myanmar Operate a variety of business (bank, airline company, hotel etc.) as the group.

Partner

Population is approx. 53 million; GDP growth rate is around 7%* Approx. 400 Japanese companies established operations 2015: Underwriting in a special economic zone licensed. July 2019: Investment of 10 % shares of IKBZ (currently KBZ MS General Insurance) has been approved provisionally by the authority. Note; IKBZ is an insurance company under KBZ Group, one of the largest conglomerates in Myanmar.

Note; *Source: The World Bank Global Economic Prospect 2019-2021 annual average

Growth Phase

13 Early Days

Acquired the non-life insurance business in Asia of AVIVA in the UK in 2004 and expand local business.

Expands Base of Non-Life Insurance Business

Invested in major life insurance businesses in different countries, including Malaysia, Indonesia, and India.

Launches Life Insurance Business

Strengthened a system for tapping into growth markets, acquiring First Capital, the largest non-life insurance business in Singapore, and investing into a life insurance business in China.

5. Looking ahead to the Future of Asia

Enters Early

Established bases in each ASEAN country at an early stage while other Japanese companies enter the markets.

MaaS Digitalization

Sharing Economy

To the New Era

• Asia is a dynamic market. • MS&AD business and activities in Asia will provide value to Asian

countries and communities, contribute to the development of society and life and to the sound development of the insurance industry through its business.

• In addition, tapping into business opportunities, we will accelerate growth of the MS&AD Group.

Strengthens Base for Growth

Accelerating growth

＜Appendix＞ Changes in the Combined Ratio

14

Changes in the combined ratio of Asian Business are as follows.

80.0%

85.0%

90.0%

95.0%

100.0%

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

90.0%

97.0%

286.1%

84.0%

87.8%

90.6%

93.2% 92.3%

97.1%

94.0%

（FY）

Thailand Flood

Growth Strategy in Asian BusinessAgendaスライド番号 3スライド番号 4スライド番号 5スライド番号 6スライド番号 7スライド番号 8スライド番号 9スライド番号 10スライド番号 11スライド番号 12スライド番号 13スライド番号 14