Japan's No. 3 non-life insurer shifts gears for further growth

Japan’s No. 3 non-life insurer shifts gears for further growth | Insurance Business Asia

Technology

Japan’s No. 3 non-life insurer shifts gears for further growth

Sompo sharpens focus on integration after global buying binge

Technology

By
Miko Pagaduan

Japanese non-life insurer Sompo Holdings is shifting its focus to integrating its domestic and overseas operations for further growth.

This follows a series of acquisitions abroad that boosted the company’s global presence, according to a Reuters report. The group’s chief operating officer, Mikio Okumura, said the company’s non-life insurance business overseas has grown to almost the same size as its domestic business.

This has eliminated the need to differentiate strategies for overseas and domestic operations.

Sompo made a global push in 2017 with its acquisition of US property and casualty insurer Endurance Specialty Holdings for $6.3 billion.

This deal provided the Japanese company with a much-needed US foothold, Reuters reported. The company has since acquired five more companies, including US agriculture insurance company Diversified Crop Insurance Services in 2020.

The group has forecasted an adjusted consolidated profit of JPY100 billion (US$746 million) for its overseas insurance business for the year ended March 2023, with an overall adjusted consolidated profit of JPY160 billion.

Okumura believes that the company does not need further acquisitions at this time, Reuters reported. Instead, he suggested that organic revenue growth could be achieved by hiring a team of professionals.

To deepen integration within the group, Sompo plans to globalize capital allocations and product launches and conduct analyses of risks on a global basis, such as cyber-attacks.

At home, Sompo is working to grow its nursing care services for the elderly as a future pillar.

The company also plans to sell its software-driven data platform globally for predictive care that helps improve the productivity of care services.

The nursing care business is targeting annual revenue of about JPY30 billion by 2030 for the data platform.

Okumura said that the company wants to present its own solutions to the aging society.

“We rapidly shifted capital allocations overseas to secure a foothold in growth markets, with a sense of emergency over a rapidly aging home market,” he told Reuters.