Tokio Marine : FY2017 Business Plan on an Adjusted Net Income Basis

May 19, 2017

Tokio Marine Holdings, Inc. President: Tsuyoshi Nagano TSE code number: 8766

Tokio Marine Group's FY2017 Business Plan on Adjusted Net Income basis

Tokio Marine Holdings, Inc. (the "Company") announced today its business plan based on an adjusted net income basis ("Adjusted Net Income", please refer to Appendix for the definition) for the fiscal year ending March 31, 2018 ("FY2017").

In the fiscal year ended March 31, 2017 ("FY2016"), Tokio Marine Group (the "Group") recorded Adjusted Net Income of 406.7 billion yen, which increased mainly due to the new consolidation of HCC Insurance Holdings, Inc.

In FY2017, the Group is targeting Adjusted Net Income of 382.0 billion yen.

１．Profits for the entire Group（Adjusted Net Income）

In FY2017, the Group is targeting Adjusted Net Income of 382.0 billion yen, a decrease of 24.7 billion yen compared to FY2016 mainly due to a decrease of investment income and other at Tokio Marine & Nichido and an increase in natural catastrophe losses (projected to be at the annual average level) at overseas subsidiaries.

（Hundred millions of Yen, except percentages）

Notes;

To appropriately capture and enhance the corporate value of the Tokio Marine Group, earnings and ROE are presented on "Adjusted Net Income" basis (please refer to Appendix for the definition).

２．Business Unit Profits

In FY2017, the Group is targeting Business Unit Profits of 160.0 billion yen for the domestic non-life insurance business, 53.0 billion yen for the domestic life insurance business, 153.0 billion yen for the international insurance business and 5.0 billion yen for the financial / other businesses.

Notes;

（Hundred millions of Yen）

To appropriately present the results of our efforts reflecting the features of each business unit, profits for each business unit are presented on "Business Unit Profits" basis (please refer to Appendix for the definition).

Regarding the domestic life insurance business, where MCEV has been adopted since FY 2015, FY 2014 figure is presented on MCEV basis for comparison.

The business plans described above are based on information available to the Company as of the date of the release of this document. Actual results may materially differ from the plans.

Definitions of Adjusted Net Income, Adjusted ROE and Business Unit Profits

1. KPI for the entire Group

   Adjusted Net Income*1

   Adjusted Net Income

   Net income (consolidated)

   *2

   Provision for catastrophe loss reserves*３

   Provision for contingency reserves*３

   Provision for price fluctuation reserves*３

   Gains or losses on sales or valuation of ALM*４ bonds and interest rate swaps

   ＝ ＋ ＋ ＋ －

   Amortization of goodwill and other intangible fixed assets

   Gains or losses on sales

   or valuation of fixed assets and business investment equities

   Other extraordinary gains/losses,

   valuation allowances, etc.

   ＋ － －

   Adjusted Net Assets*1

   Adjusted Net Assets

   Net assets (Consolidated)

   Catastrophe loss reserves

   Contingency reserves

   Price fluctuation reserves

   Goodwill and other intangible fixed assets

   ＝ ＋ ＋ ＋ －

   Adjusted ROE

   Adjusted ROE

   Adjusted Net Income

   Adjusted Net Assets (average balance basis)

   ＝ ÷

2. Business Unit Profits*1

1. Non-life insurance business

   Business Unit Profits

   Net income

   Provision for	Provision for	Gains or losses on sales or
   ＋	catastrophe loss	＋	price fluctuation	－	valuation of ALM*４ bonds
   reserves*３	reserves*３	and interest rate swaps

   ＝

   Gains or losses on sales or valuation of fixed assets, business related equities and business investment equities

   Other extraordinary gains/losses,

   valuation allowances, etc.

   － －

   Business Unit Profits

   Increase in EV*6 during the current fiscal year

   Capital transactions such as

   capital increase

2. Life insurance business*5

   ＝ －

3. Other businesses

Net income presented in financial statements

*1: Each adjustment is on after-tax basis

*2: Net income attributable to owners of the parent presented in Consolidated Financial Statements

*3: In case of reversal, it is subtracted from the equation

*4: ALM: Asset Liability Management. Excluded since it is counter balance of ALM related liabilities

*5: For some of the life insurance companies, Business Unit Profits is calculated by using the definition in (3) (head office expenses, etc. are deducted from profits)

*6: EV: Embedded Value. An index that shows the sum of the net present value of profits to be gained from policies in-force and the net asset value