According to report from Fitch Ratings, Japanese non-life insurers are likely to continue to look for M&A opportunities overseas to improve returns from the capital that will be released by continued reduction of their equity crossholdings.
The overseas businesses of the three major Japanese non-life groups demonstrated strong growth in the financial year ending March 2015 contributing to the overall earnings for the respective groups. Overseas businesses are a key growth driver for the Japanese non-life groups, while appropriate risk management remains important, according to Fitch.
Underwriting profit of their domestic non-life business also jumped in FYE15, driven by the premium growth and the absence of catastrophic-loss events. That said, catastrophe exposures and domestic equity exposures continue to cause volatility in non-life insurers' operating performance.
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