JAPAN POST INSURANCE Co.,Ltd.

Business Details

Under licenses and approvals based on the Insurance Business Act, the company conducts underwriting operations for individual insurance and individual annuity insurance, as well as asset management operations including securities and money in trust. Using the post office network as the primary sales channel, the company provides endowment insurance, whole life insurance, and other products primarily to the household market nationwide. It also handles management operations for postal life insurance contracts reinsured from the Management Organization for Postal Savings and Postal Life Insurance. Special measures such as enrollment limit regulations under the Postal Service Privatization Act apply.

Recent Overview

Ordinary profit up 59.7% and net income up 36.7%, marking substantial profit growth, while net assets increased 28.1%

In FY2026 (ending March 2026), despite a decline in ordinary revenues to ¥5,625,758 million (down 8.8% year on year), the company achieved substantial profit growth, with ordinary profit of ¥271,946 million (up 59.7% year on year) and net income attributable to owners of the parent of ¥168,798 million (up 36.7% year on year). Profit was boosted by a reduction in the standard policy reserve burden associated with the first year of new policies, an expansion in gains on money in trust (¥397,705 million, approximately double the prior period), and reversal of reserve for price fluctuations of ¥110,697 million. Net assets expanded to ¥4,153,628 million (up 28.1% year on year) due to a substantial increase in valuation difference on available-for-sale securities (up ¥896,783 million). A stock split (one share into three shares) was implemented effective April 1, 2026. For FY2027 (ending March 2027), the company forecasts ordinary revenues of ¥5,130,000 million, ordinary profit of ¥250,000 million, and net income of ¥141,000 million.

Key Products

Growth Drivers

• Increase in positive spread and expansion of gains on money in trust (¥397,705 million for the current period, approximately double the prior period) due to an improved investment environment (rising interest rates and yen depreciation)
• Profit-boosting effect from the reduced burden of standard policy reserves for the first year of new policies
• Maintenance and expansion of new policy volume through continued sales of single-premium whole life insurance
• Contribution to extraordinary income from the recording of reversal of reserve for price fluctuations (¥110,697 million for the current period)
• Efforts to diversify revenue sources through alliances with Daiwa Securities Group, KKR, and GA, among others
• Expansion of the investor base and improvement in share liquidity through the stock split (1 share to 3 shares, implemented April 1, 2026)

Risks

• Structural contraction of insurance premiums and other revenues due to a continuing decline in the number of policies in force (insurance premiums and other revenues for the current period were ¥2,188,660 million, down 30.6% year on year)
• Regulatory constraints under the Postal Service Privatization Act, including enrollment limits and a notification system for new business
• Compliance risk and reputational risk associated with cases of improper use of non-public financial information and cases of soliciting single-premium whole life insurance prior to approval
• Risk of fluctuation in investment income due to changes in interest rates, stock prices, and exchange rates (deferred tax assets declined substantially from ¥728,870 million to ¥322,742 million)
• Risk of changes in estimates for policy reserves and reserve for outstanding claims (policy reserves balance of ¥48,102,350 million)
• Slowing profit momentum due to the forecast 16.5% decline in net income (¥141,000 million) for FY2027 (ending March 2027)
• Continued substantial negative operating cash flow (current period: ¥-1,884,930 million)
• Capital policy risk associated with share buybacks (¥79,999 million for the current period) and the planned cancellation of treasury shares (30,650,400 shares) scheduled for June 30, 2026