Sompo Japan Insurance Inc. (E03827) Stock Price

**Business Overview of Sompo Japan Insurance Inc.**

Sompo Japan Insurance Inc. is a major property and casualty insurance company under the SOMPO Holdings umbrella. The company provides various insurance products including auto insurance and fire insurance, operating insurance businesses both domestically and internationally. It serves a wide range of customers from individuals to corporations, offering coverage against diverse risks.

The company's primary customers include individual vehicle owners, homeowners, and corporate clients ranging from small to large enterprises. Revenue is primarily generated from insurance premiums collected from customers, with profits derived from the difference between premiums and insurance payouts, as well as investment returns. In addition to a stable domestic customer base, the company is diversifying revenue through expansion of overseas operations.

Business segments are divided into domestic property and casualty insurance, overseas insurance, and defined contribution pension operations. The domestic business handles core products such as auto insurance, fire insurance, and injury insurance, along with various liability insurance products for corporate clients. In overseas operations, the company actively expands insurance services in Asian and other international markets through subsidiaries and affiliated companies.

Sompo Japan is pursuing ambitious financial targets in its medium-term management plan for fiscal 2024-2026, aiming for adjusted consolidated ROE of 13-15% and adjusted EPS growth exceeding 12% annually. The company is positioning resilience improvement and sustained corporate value enhancement at the core of its strategy to realize a future filled with "peace of mind, safety, and health." In fiscal 2024, Sompo Japan achieved adjusted consolidated profit of 323.4 billion yen, with adjusted consolidated ROE at 9.2%.

Key investment priorities include the establishment of a 30 billion yen fund for human capital strengthening. The company is actively investing in data-driven operations leveraging generative AI and digital technologies to drive operational efficiency and automation. It is also enhancing global underwriting expertise and expanding customer and broker networks to strengthen its capacity to address increasingly complex and large-scale risks. Regarding strategic shareholdings, the company has raised its divestment target from the initially planned 600 billion yen to over 800 billion yen, accelerating business portfolio restructuring.

In new market development, the company has consolidated domestic and international operations into two business domains—"SOMPO P&C (property and casualty insurance)" and "SOMPO Well-being"—each with a dedicated business CEO. In international insurance operations, the company aims for adjusted profit of 203 billion yen by fiscal 2025 through disciplined expansion, continuing geographic expansion across the United States, United Kingdom, Europe, and Asia. The well-being business is cultivating a new growth engine through health support services adapted to the 100-year life era and quality improvements in long-term care services.

Regarding technological innovation, Sompo Japan is breaking away from traditional industry practices and transforming into a company chosen by customers through delivering insurance's core value. The company is achieving efficiency and automation across all processes from product development to claims payment, and advancing sophisticated risk assessment through data analytics. Through its Center of Excellence initiative, the company plans to share best practices across the group and accelerate its evolution into a Japan-based global enterprise. However, the company is simultaneously addressing business improvement orders, making compliance system reconstruction a critical management priority.