TCFD REPORT

2024

INDEXCEO Message …………………………………………………………………………………… 3
Climate-related Financial Disclosure Based on the TCFD Recommendations
Governance………… 4………………………………………………………………………………………… 5❶ Supervisory and Execution Structure for Responding to Climate Change 6❷ Compensation System for Directors and Executive Officers 6

Strategies…………………………………………………………………………………………… 8❶ Recognition of Risks and Opportunities 9❷ Scenario Analysis 11

A. Physical Risks 11
B. Transition Risks 18❸ Implementation of Climate Change Strategy 19

A. Initiatives of Tokio Marine Group 19
B. Policies Concerning Insurance Underwriting as well as Investment and Financing 33❹ Plan for the Transition to a Decarbonized Society 35

Risk Management ………………………………………………………………………………… 36
Metrics and Targets……………………………………………………………………………… 39❶ Metrics and Targets 40❷ GHG Emissions from Business Operations 41❸ GHG Emissions for Investment Portfolio 42

CEO Message
Climate-related Financial Disclosure
Based on the TCFD Recommendations

1

Governance2

Strategies

3

Risk Management

4

Metrics and Targets

CEO Message
Tokio Marine Group aims to solve societal challenges through our business based on the Group’s purpose of protecting ourcustomers and society in times of need and to increase our corporate value as a result. Supporting our society through ourbusiness activities, we aim to “inspire confidence and accelerate progress” for our customers and society.
Climate change is a serious global issue, which threatens the safety and security of our customers and society. The
intensification of natural disasters directly affects the insurance industry. Therefore, we recognize that climate change isan extremely important issue to address as an insurer (insurance products and services), a global company, institutional
investor, asset manager and good corporate citizen. Climate action has become more urgent as we continue to witness
natural disasters of unprecedented scale around the world. Examples abound, such as windstorm, flood and hailstorm inJapan, the wildfire in Hawaii in 2023 and more recently, the extensive flooding in Brazil in 2024. Climate action at Tokio
Marine Group includes providing insurance products and services and increasing investment and financing to promote thetransition to a decarbonized society as well as reinforcing our structure to make claims payments promptly after natural
disasters.
We have been communicating and collaborating with various international organizations, governments, industries,
academic institutions and civil society to achieve the goal of the Paris Agreement, which was adopted in December 2015.
Based on such constructive dialogue and collaboration, Tokio Marine Group will actively engage in climate action andcontribute to the transition to a decarbonized society.

Satoru Komiya
President and Group CEO
Tokio Marine Holdings, Inc.

Based on the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD), the following sections
capture the impact of climate change on our business and society and present Tokio Marine Group’s initiatives towardrealizing the transition to a decarbonized society. In this TCFD Report 2024, we have also enhanced disclosures of
information on Tokio Marine Group’s various initiatives on mitigation and adaptation to climate change and its plan for thetransition to a decarbonized society.

TCFD Report 2024

3

CEO Message
Climate-related Financial Disclosure
Based on the TCFD Recommendations

1

Governance2

Strategies

3

Risk Management

4

Metrics and Targets

Climate-related Financial Disclosure Based on the TCFD Recommendations
The Task Force on Climate-related Financial Disclosures (TCFD) had been entrusted by the Financial

disclose climate-related information and how to link the disclosed information to appropriate investment

Stability Board (FSB) to formulate voluntary recommendations for consistent, comparable, reliable,

decision-making of financial and other organizations. It has also contributed to the release of “A Guide toclear and efficient climate-related disclosures by companies in the financial sector and released its final

Flood Risk Assessments for Enhanced TCFD Disclosures” of the Ministry of Land, Infrastructure, Transport

recommendations (TCFD recommendations) in June 2017.

and Tourism in March 2023.

The frequency and intensity of natural disasters caused by climate change represent a global issue andTokio Marine Holdings has been making disclosures based on the TCFD recommendations starting fromhave a significant impact on Tokio Marine Group as we engage in insurance and financial services. As a

its Integrated Annual Report 2017 and has been striving to enhance its content every year.

founding member of the TCFD, Tokio Marine Holdings has contributed to the formulation and publicationof the TCFD recommendations and has been working toward the formulation of policy recommendations

The table below is an overview of the four fields of disclosure based on the TCFD recommendations. In thisto encourage disclosure that will help investment decisions by engaging in discussions and exchanging

report, we provide detailed information in each field.

opinions with relevant government and private-sector parties in Japan and overseas.
Disclosure Based on the TCFD Recommendations

In July 2018, Tokio Marine & Nichido became a founding member of the insurer pilot group, launched by theUnited Nations Environment Programme Finance Initiative (UNEP FI) under the Principles for Sustainable
Insurance (PSI) framework, to examine and develop methodologies and analytical tools for the insurance
industry to make climate-related disclosures based on the TCFD recommendations. The company has
contributed to the publication of the final report of the UNEP FI pilot project, entitled “Insuring the climatetransition,” in January 2021.
In Japan, the then Chairman of the Board of Tokio Marine Holdings worked as one of the founders andcontributed to the establishment of the TCFD Consortium in May 2019. After the establishment, Tokio
Marine Holdings has been a member of the Planning Committee to deliberate on the consortium’s courseof action and has contributed to the release of the TCFD Guidance (most recently TCFD Guidance 3.0
released in October 2022). The Company also participates in discussion on effective ways for companies toGovernance

Strategiesa) O versight by the Board a) C limate-related risks
of Directors
and opportunitiesb) I mpact of climateb) Management role
related risks andopportunitiesc) P ossible impact ofdifferent climaterelated scenarios

Risk management

Metrics and targetsa) P rocesses fora) M etrics used to assess
identifying andclimate-related risks
assessing climateand opportunitiesb) S copes 1, 2 and 3
related risksb) Processes for managing
greenhouse gas (GHG)
climate-related risks
emissionsc) I ntegration of thesec) Targets used to manage
processes into overall
climate-related risks
risk management
and opportunities

Source: Created by Tokio Marine Holdings based on the Recommendations of the Task Force on Climate-related Financial
Disclosures, Figure 4 (p. 14), TCFD, June 2017

TCFD Report 2024

4

GovernanceCEO Message
Climate-related Financial Disclosure
Based on the TCFD Recommendations

1

Governance2

Strategies

Risk Management

4

Metrics and Targets[Group Chief Sustainability Officer (CSUO)]

Governance
Various initiatives related to climate action are reported to the Board of Directors after the discussion
at the Sustainability Committee and Management Meeting. In our governance structure, each relevant
execution body voluntarily promotes initiatives under the supervision of the Board of Directors. Key
related bodies and their roles are as follows.

We established the new position of CSUO in April 2021 to accelerate the promotion of sustainability
strategy, including climate action, across the entire Group. The CSUO oversees the promotion andpermeation of the sustainability strategy, presents related policies to the Board of Directors and theManagement Meeting for discussion and takes the role of reporting the progress to these bodies.
[Sustainability Committee]❶ Supervisory and Execution Structure for Responding to Climate Change[Board of Directors]
The Board of Directors recognizes responding to climate change as a material management issue
and assumes the role of supervising our sustainability strategy and initiatives. The Board deliberates
on our sustainability policies including climate action, as well as evaluates and determines mid-termand single-year plans. The Board receives reports from the Sustainability Committee every quarterin principle to monitor sustainability initiatives and provides instructions as necessary. In addition,
the Board of Directors holds deliberation on corporate strategy on the themes of the management
environment and management issues, including climate action, to fully utilize the knowledge ofoutside directors and outside Audit & Supervisory Board members.
Corporate Governance, Integrated Annual Report 2023 (P.106-112)

In fiscal 2023, the Board met four times to deliberate on and receive reports about our sustainability
initiatives including climate action.
Date

3

We established the Sustainability Committee in April 2021 to accelerate our sustainability strategy,
including climate action, across the entire Group. Chaired by the CSUO and comprising suchmembers as the CEO, chief officers and management of overseas Group companies, the Sustainability
Committee deliberates on details of our sustainability initiatives and policies on a global basis andmonitors the progress of each initiative. The committee met four times in fiscal 2023 to promoteand execute the sustainability strategy, formulate mid - to long-term targets (KPIs) related tosustainability, formulate and review annual plans and deliberate on other items.
[Division Dedicated to Promoting Sustainability]
The Sustainability Division of the Corporate Planning Department is a division dedicated tothe promotion of the Group’s sustainability initiatives, including climate action. This division is
responsible for operating the Sustainability Committee and promoting the Group’s sustainability
initiatives while consistently communicating relevant strategies to Group companies, sharing
information and undertaking learning and support activities.

❷ Compensation System for Directors and Executive Officers
Items deliberated and reported

May 2023

Group’s sustainability-related initiatives in fiscal 2022 and the annual plan for fiscal 2023

Oct. 2023
Nov. 2023

Progress in the Group’s annual sustainability plan for fiscal 2023

Mar. 2024

Progress in the Group’s annual sustainability plan for fiscal 2023 (second half )In fiscal 2022, we started incorporating non-financial indicators concerning the tasks on climate
action and other key issues in our sustainability strategy into the performance-linked compensation
for Directors and Executive Officers. We use the progress of each task toward our vision as anindicator, and after performing the initial assessment of progress at the Sustainability Committee, thefinal decision is made after deliberation by the Compensation Committee.
TCFD Report 2024

6

CEO Message
Climate-related Financial Disclosure
Based on the TCFD Recommendations

Governance1

Strategies

2

3

Risk Management

4

Metrics and Targets

Tokio Marine Holdings’ Organizational Structure for Promoting Sustainability

Board of Directors

CEOManagement Meeting

Four times annually

Sustainability Committee

CSUO(comprised of the CEO and chief officers)(Note 1)

Secretariat(Note 2)

(Note 3)

Working Groups
Products andservices

Operations

Task Forces

SocialCommunications
contributions

Businessstrategies

TCFD

TNFD

Diversity
Council(Note 1) Secretariat (Sustainability Division, Corporate Planning Department):	Operates the committee (as well as the working groups and task forces) and promotes
the overall sustainability strategies across the Group.

Departments(Note 2) Working Groups:
	Formulate and execute annual plans for respective issues, with the participation of
relevant departments of Tokio Marine Holdings and members of Group companies.
	Formulate plans and coordinate actions regarding measures to address material issues.
Group companies in thedomestic non-life
insurance businessGroup companies
in the domestic
life insurance businessGroup companies in thedomestic financial andother businesses

Group companies
in the international
insurance business(Note 3) Task force:	Form project teams to handle tasks that require intensive response over a short term.

TCFD Report 2024

7

Strategies

CEO Message
Climate-related Financial Disclosure
Based on the TCFD Recommendations

1

Governance2

Strategies

3

Risk Management

4

Metrics and Targets

Strategies
In responding to climate change, which poses a global social issue critical to human history and important❶ Recognition of Risks and Opportunities

for Tokio Marine Group, we promote initiatives toward achieving carbon neutrality by 2050 in keeping

In developing a strategy, recognizing inherent risks is essential. Tokio Marine Group assumes an increase

with the promise of the Sustainable Development Goals (SDGs) of leaving no one behind and based onin climate-related risks and accordingly identifies and evaluates their impact on our business. Climate-constructive dialogue (engagement) with all of our stakeholders. As an insurer (insurance products andrelated risks include physical risks and transition risks. Physical risks arise from an increase in the frequency

services), institutional investor and asset manager, we provide support both in terms of mitigating andand intensity of natural disasters caused by climate change, while transition risks result from the impacts

adapting to climate change and help customers and investment and financing recipients solve theirof the transition to a decarbonized society on the corporate value of investee companies and assets

respective issues. Efforts include providing insurance products and services to support the transition to aheld by us. On the other hand, initiatives to mitigate and adapt to climate change also provide businessdecarbonized society, such as those promoting the more widespread use of renewable energy; providing

opportunities for Tokio Marine Group. On the next page, we show examples of events for each risk andinsurance to cover damages caused by natural disasters; services that will lead to prevention or reduction

opportunity based on the TCFD recommendations and examples of risks and opportunities to the Group’sof damages; and undertaking sustainable investment and financing.

business activities.

As a global company, we also take climate action through collaboration and cooperation with

As is described later in the “Risk Management” section, Tokio Marine Group identifies the “risk of majorinternational and other organizations. We intend to contribute to the mitigation and adaptation to climate

wind and flood disasters (including physical risks of climate change)” as a material risk that will have anchange and seek growth together with our stakeholders. Social contribution activities are also key toextremely large impact on our financial soundness and business continuity. We believe such risks could

climate action. As such activities, we plant mangroves and engage in research and educational activities

increase in frequency and severity due to climate change.

to increase society’s resilience, thereby contributing to climate action as a good corporate citizen in local
communities.
Additionally, Tokio Marine Group announced “Tokio Marine: Our Climate Strategy” in September 2020 andhas since reviewed and updated the statement annually. In this statement, Tokio Marine Holdings commits
itself to providing all-out support to customers and investment and financing recipients with regard toclimate action.

TCFD Report 2024

9

CEO Message
Climate-related Financial Disclosure
Based on the TCFD Recommendations

1

Governance2

Strategies

Physical risks

Examples of events
Acute

Potential for growing frequency and scale of hurricanes, floods and other
weather events

Chronic

Rise temperature
Other weather changes, such as droughts and heat waves
Rising sea levels
Impact on arthropod-borne infectious diseases

Transition risks

Policies and regulations

Technology

Markets

Opportunities

Reputation

Increase in carbon prices
Strengthening of environment-related regulations and standards
Increase in climate-related legislation
Progress in technological innovation and technology development toward
the transition to a decarbonized society and improvement in resilience
Changes in the demand for and supply of products and services

Changing customer and societal awareness of initiatives surrounding thetransition to a decarbonized society and improving resilience3

Risk Management

4

Metrics and Targets

Examples of risks to the Group’s business activities

Time frame
Short term
or longer• Decrease in insurance profits resulting from an increase in claims payments and a rise inreinsurance premiums• Impact on business continuity caused by damage to buildings and other facilities at bases• Decrease in the corporate value of investee companies and the value of Company assets
due to higher carbon prices• Impact on liability insurance payments• Decrease in the corporate value of investee companies that have missed the transition toa decarbonized society and in the value of the assets held by the Company• Decline in revenue due to technological innovation and inability to ascertain changes incustomer needs

Mediumto long term

Mediumto long term

Mediumto long term
Short term
or longer
Short term
or longer• Reputational damage due to the Company’s efforts being deemed inappropriate• I ncreases in opportunities to gain insurance profits and for investment and financing on
the back of companies’ increasing insurance and funding needs associated with the
Resource efficiency, energy sources,
Demand for products and services aligned with changes in energy sources
transition to a decarbonized society and improvement of resilience
products and services,and designed to increase resilience; changes in public awareness•H igher recognition from customers for initiatives related to the transition to amarkets and resiliencedecarbonized society and improvement of resilience

Short term
or longer

Note: Short term: less than 3 years, Midium term: 3-10 years, Long term: 10 years or more

TCFD Report 2024

10

CEO Message
Climate-related Financial Disclosure
Based on the TCFD Recommendations

1

Governance2

Strategies

3

Risk Management

4

Metrics and Targets❷ Scenario Analysis

The Tokio Marine Research Institute, a Group company, began conducting research in 2007 to evaluate

Scenario analysis is a process of identifying and evaluating the potential impact of climate change basedand calculate the impact on insurance loss of changes in wind disaster risk associated with typhoons

on certain scenarios. The Group believes it can be flexible and resilient to these impacts, as most non-life

under future climate conditions (impact under the IPCC’s RCP4.5 and RCP8.5 scenarios) and changes ininsurance policies are relatively short term and the Group’s assets under management are mainly highly

flood risk due to increased rainfall (impact resulting from temperature increases of 2°C and 4°C). Referring

liquid financial assets.

to the results of this scenario analysis, we assess the impact on underwriting of natural disasters resulting
from increasingly severe climate change.

<A. Physical Risks>
Physical risks are those related to physical impacts of climate change. Climate change increases the

Future projections of climate change scenarios (+2°C, +4°C, etc.) are subject to uncertainties, as describedfrequency and intensity of natural disasters, which could impact claims payments and business continuity.

later (see page 14). In assessing the impact of climate change, it is also important to evaluate not only

We conduct a scenario analysis of physical risks as part of our efforts to identify and assess their impact.

weather phenomena but also the vulnerability of society to disasters as well as the extent to whichreal estate and personal properties will be concentrated in areas exposed to natural disaster risk in theA-1. Impact on Claims Payments

future and the extent to which their asset values will increase (in other words, the extent to which asset

The Group takes part in the United Nations Environment Programme Finance Initiative (UNEP FI). Using

concentration will change). The basis for these projections and assessments is indicated in the following

analysis and assessment tools developed by UNEP FI’s climate change impact assessment project, we havepages.

created the following assessment of the impact of changes in the intensity (wind speed) and number oftropical cyclones on our claims payments under the IPCC’s Representative Concentration Pathway (RCP)
8.5 scenario forecast as of 2050.
Changes in claims payments in 2050
Intensity (wind speed)

Number of formations

Japan (typhoons)+5% to +53%

-30% to +28%

United States (hurricanes)

0% to +37%

-36% to +30%

* The figures above reflect economic losses, assuming the same impact on claims payments.
* The figures above show the rate of change from current weather conditions (1980–2000) to those in around 2050.

TCFD Report 2024

11

CEO Message
Climate-related Financial Disclosure
Based on the TCFD Recommendations

1

Governance2

Strategies

3

Risk Management

4

Metrics and Targets[Changes in Weather Events]

For heavy rains and tropical cyclones, which are two weather events that considerably affect Tokio Marine

How a weather event will change due to the impact of climate change and the degree of confidence ofGroup, we consider the impact of climate change as follows.

such an impact forecast will vary depending on the type of weather event. Figure 1 shows the confidenceof climate change impact projections by weather event type. As seen in the figure, the confidence of◆ Impact of Climate Change on Heavy Rains

impact projections for extreme rainfall (heavy rains) is higher than that for tropical cyclones, such as

In Japan, the frequency of heavy rains has been on the rise since 1900 (Figure 2). The IPCC Sixth

typhoons and hurricanes, but the impact on extreme rainfall (heavy rains) involves greater uncertainty

Assessment Report released in August 2021 states that heavy rains will become more severe in thecompared to such temperature variations as extreme heat (heat wave) or extreme cold (cold wave).

future in line with temperature rise. It also mentions that for every 1ºC temperature rise, the intensity

Tornadoes and wildfires also involve great uncertainty.

(precipitation) of heavy rains will increase by approximately 7%.
2.5

Number of days per year

High
confidence

Ability to detect possible influenceof climate change on specific event

Extreamcold
Extreamheat

Droughts
ExtremeExtreamsnow
rainfall& ice
ExtratropicalTropical
cyclones
cyclones
Severeconvective Wildfires
stormsLow
confidence

2

1.5

1

0.5

0

1901 1904 1907 1910 1913 1916 1919 1922 1925 1928 1931 1934 1937 1940 1943 1946 1949 1952 1955 1958 1961 1964 1967 1970 1973 1976 1979 1982 1985 1988 1991 1994 1997 2000 2003 2006 2009 2012 2015 2018 2021

Figure 2: Days per year with daily precipitation of 100 mm or more
Source: Tokio Marine Holdings based on materials from the Japan Meteorological Agency (website)High
confidence

How well we understand the likely influence
on event types in general
Figure 1: Confidence of impact forecasts of climate change
Source: Tokio Marine Holdings based on material prepared by the U.S. National
Oceanic and Atmospheric Administration

TCFD Report 2024

12

CEO Message
Climate-related Financial Disclosure
Based on the TCFD Recommendations

1

Governance2

Strategies

Risk Management

34

Metrics and Targets◆ Impact of Climate Change on Tropical Cyclones

In the future, while the number of tropical cyclones is expected to level off or decrease overall, the ratio of

Atmospheric and oceanic large-scale circulations (e.g., El Niño and monsoons) are closely related to theintense tropical cyclones is forecast to increase. As such, there are both decrease and increase projections

formation, development and movement of tropical cyclones. As climate change affects each of these

for the number of intense tropical cyclones (IPCC Sixth Assessment Report).

factors, the impact of climate change on tropical cyclones consequently becomes more uncertain.
Wind speed(increase)

First, looking at past trends, the IPCC Sixth Assessment Report reported an increase in the number ofobservations will be needed to monitor changes in long-term trends (Japan Meteorological Agency).
As for hurricanes making landfall in the United States, even though the ratio of major hurricanes has
risen over the past 40 years, a longer-term survey covering the period from 1900 revealed that there
is no discernible trend both in the number of total hurricanes and that of major hurricanes (IPCC Sixth

Change rate (%)

intense typhoons in Japan. However, the certainty level is not yet high, and longer-term, higher-quality

Precipitation(increase)

Number of all tropical cyclones(Both Increase/Decrease)

Number of major cyclones(Both Increase/Decrease)

%

%

%

%

30

30

80

80

20

20

40

40

10

10

0

0

0

0

-40

-40

Typhoon Hurricane Global

Typhoon Hurricane Global

Typhoon Hurricane Global

Typhoon Hurricane Global

Assessment Report).

Number of continental U.S.
landfalling hurricanes

Figure 4: Changes in tropical cyclones due to a temperature change of +2ºC
8

All hurricanes

4

Major hurricanes

76* Thomas Knutson, Suzana J. Camargo, Johnny C. L. Chan, Kerry Emanuel, Chang-Hoi Ho, James Kossin, Mrutyunjay
Mohapatra, Masaki Satoh, Masato Sugi, Kevin Walsh, and Liguang Wu, 2020: Tropical cyclones and climate change
assessment part II: Projected response to anthropogenic warming. Bull. Amer. Meteor. Soc.,101, E303‒E322,
https://doi.org/10.1175/BAMS-D-18-0194.1 (© American Meteorological Society. Used with permission.)3

5
4

Source: Tokio Marine Holdings based on Knutson et al., 2020*

2

3
2

1

1
0

0
1900 1905 1910 1915 1920 1925 1930 1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015

1900 1905 1910 1915 1920 1925 1930 1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015

Figure 3: Number of hurricanes making landfall in the United States
Source: Tokio Marine Holdings based on Klotzbach et al., 2018**Philip J. Klotzbach, Steven G. Bowen, Roger Pielke Jr., and Michael Bell, 2018: Continental U.S. hurricane
landfall frequency and associated damage. Bull.
Amer. Meteor. Soc., 99, 1359‒1376, https://doi.org/10.1175/BAMS-D-17-0184.1(© American Meteorological Society. Used with permission.)

TCFD Report 2024

13

CEO Message
Climate-related Financial Disclosure
Based on the TCFD Recommendations

1

Governance2

Strategies

3

Risk Management

4

Metrics and Targets[Changes in Vulnerabilities in Society and Asset Exposure]◆Changes in Vulnerabilities in Society

As shown in Figure 2 on page 12, the frequency of heavy rains in Japan has been increasing since 1900.

In Japan, revisions to the Building Standards Act have proved to directly translate into the better resilience

Figure 5 below, on the other hand, shows a declining trend for flooded areas. This is because Japan’sof society as a whole. In fact, revisions made in 1981 to the seismic building codes and in 2000 to thedisaster prevention infrastructure, including embankments, has improved since the mid-19th century andwind pressure resistance building codes have greatly contributed to the improved resistance of buildings

is effectively reducing the occurrence of floods during heavy rains.

against natural disasters. More recently, Typhoon Faxai, which made landfall in 2019 and caused damage

Flooded area
(housing districts and others) (ha)to the roofs of many houses, has prompted revisions to the standards for roofing on countermeasuresagainst intense winds, which were enacted in January 2022. In addition, the Ministry of Land,

120,000

Infrastructure, Transport and Tourism has already announced its policy that the anticipated intensification

100,000of natural disasters should be considered in improving disaster prevention infrastructure in the future.

80,000Overseas, efforts to increase resilience throughout society have also been under way. The United States,

60,000for example, has improved its disaster prevention infrastructure and revised building codes following

40,000huge natural disasters, including large hurricanes.

20,00001965 1968 1971 1974 1977 1980 1983 1986 1989 1992 1995 1998 2001 2004 2007 2010 2013 2016 2019 年

Figure 5: Areas inundated by floods (ha)Source: Tokio Marine Holdings based on materials from the Ministry of Land, Infrastructure,
Transport and Tourism (flood statistics)

In keeping with the move toward strengthening resilience all over the world, Tokio Marine Group has been
contributing to greater resilience of the entire society by supporting customers to cope with disasters
through the provision of various solutions designed to increase disaster resilience and dissemination ofdisaster prevention and mitigation information.

The amount of damage will vary significantly if there is a change in asset exposure, that is, a change inthe degree of concentration of assets or in the value of assets in areas exposed to natural disaster risk. In
this way, we recognize that identifying changes in weather events themselves, such as heavy rains andtyphoons, as well as changes in society’s vulnerabilities to disasters and in asset exposure are essential inpredicting damage due to natural disasters.

TCFD Report 2024

14

CEO Message
Climate-related Financial Disclosure
Based on the TCFD Recommendations

1

Governance2

Strategies

Risk Management

34

Metrics and Targets◆ Recognition of Changes in Asset Exposure
In Japan, an influx of people into urban areas is expected to continue in the future. Over the period
from 2015 to 2040, even though the number of households in the country is projected to decline 4.8%
on national average, an increase is expected in some prefectures, including Tokyo. As such, the trend ofchanges in asset exposure varies from region to region.

N

From the viewpoint of damage due to natural disasters, an important factor is the exact location of assets(whether within a hazardous area). In response to frequent occurrence of natural disasters in recent years,
Japan’s Ministry of Land, Infrastructure, Transport and Tourism has stated that it is important to consider
flood risk reduction when determining the locations of housing districts and city functions. Accordingly,
Tokio Marine Group is monitoring the policy trends of the national and local governments.

(%)

0 or higher-5 to less than 0-10 to less than -5
Less than -10

0

400km

National: -4.8%

Figure 6: Changes in the number of households from 2015 to 2040
Source: National Institute of Population and Social Security Research, “Number of Household Projections for Japan (2017 Estimates)”

TCFD Report 2024

15

CEO Message
Climate-related Financial Disclosure
Based on the TCFD Recommendations

1

Governance2

Strategies

3

Risk Management

4

Metrics and Targets

Changes in the exposure geographic distribution are important in considering natural disaster damage[Incurred Losses in the Recent Major Natural Disasters]

both in Japan and overseas. In the United States, economic loss caused by hurricanes in the past is known

The table below shows the recent major natural disasters and their incurred losses. In Japan and theto be on an upward trend, but when the impact of a change in inflation, wealth properties and population

United States, disasters cause a certain level of damage each year that involves insurance claims payments.

is normalized, there is no longer a significant trend. Thus, a rise in economic loss is mostly a result of theseAs such, we enforce appropriate risk control by leveraging risk diversification and reinsurance.

factors.

Continental U.S. economic loss from hurricanes (USD billion)

250
200

Adjusted by inflation only

150

Direct premiums
written*2

Torrential rain in July

¥32.4 billion

Typhoon Haishen¥30.6 billion

Torrential rain in AugustOverseas*1

Net incurred losses*2¥11.5 billion

Hurricane Ida¥18.4 billion

Typhoon Lupit¥4.5 billion

Cold wave in Texas¥17.8 billion

Typhoon Nanmadol¥33.2 billion

Hurricane Ian¥30.6 billion

Typhoon Talas¥15.2 billion

Winter Storm Elliott¥15.5 billion

Hail disaster in Gunma
and Tochigi in July

¥25.4 billion

Wildfire in Hawaii¥36.1 billion

Typhoon Mawar¥10.3 billion

Typhoon Yun-yeung¥6.6 billion

2020

100
50
0
1900 1905 1910 1915 1920 1925 1930 1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015

250
200

Domestic*1

Adjusted by inflation and exposure

2021

2022

150
100

2023

50
0
1900 1905 1910 1915 1920 1925 1930 1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015

*1 Total of Tokio Marine & Nichido, Nisshin Fire and E. design Insurance*2 Before tax

Figure 7: Economic loss due to hurricanes on the U.S. mainland
Source: Tokio Marine Holdings based on Klotzbach et al., 2018**P hilip J. Klotzbach, Steven G. Bowen, Roger Pielke Jr., and Michael Bell, 2018: Continental U.S. hurricane landfall
frequency and associated damage. Bull. Amer. Meteor. Soc., 99, 1359‒1376, https://doi.org/10.1175/BAMS-D-17-0184.1(© American Meteorological Society. Used with permission.)

TCFD Report 2024

16

CEO Message
Climate-related Financial Disclosure
Based on the TCFD Recommendations

1

Governance2

Strategies

3

Risk Management

4

Metrics and Targets

A-2. Impact on Business Continuity: Promoting Climate Change Adaptation Measures◆ Findings from the Analysis of Water-Related Risks at Our Business Offices in Japan

Tokio Marine Group uses multiple scenarios*1 to perform analysis and evaluation*2 on the impact of

In fiscal 2023, in an effort to understand water-related risks facing our business offices in Japan, we

climate change risk on our operations using holistic and context-specific approaches. By doing so, we are

analyzed and assessed water-related physical risks (flood inundation and storm surge, landslide disasters,

promoting climate action and initiatives to increase resilience against disasters.

etc.) at our consolidated subsidiaries in Japan and some insurance agents* of Tokio Marine & Nichido by*1 Including IPCC’s Shared Socioeconomic Pathway (SSP) 5-8.5, SSP3-7.0, SSP2-3.5, SSP1-2.6, SSP1-9, RCP8.5, RCP6.0, RCP4.5 and RCP2.6
scenarios*2 Climate change risk analysis and evaluation conducted in collaboration with Resilience of the United Kingdom

using the digital national land information provided by the Ministry of Land, Infrastructure, Transport andTourism. As a result, among the 1,154 business offices analyzed (489 business offices of Group companies
in Japan and 665 business offices of Tokio Marine & Nichido’s insurance agents), 203 business offices are[Holistic Approach]located in areas with high risk of flooding, while 12 are in areas with high risk of landslide disasters. We

Based on a holistic approach, we use multiple scenarios to analyze and evaluate, both quantitatively

have already investigated and analyzed the flood risk at our business offices and have not detected any

and qualitatively, the impact of an increase in weather disasters (such as heavy rains and floods)

notable negative impacts associated with the risk at this point. In addition, each office has independently

caused by climate change on our operations. Accordingly, we have been implementing measures

implemented crisis management measures. Nonetheless, these water-related risks may become

from medium- to long-term (about two to five years) and short-term (within one year) viewpoints.

increasingly apparent in the future, following the rise in the sea level and more frequent heavy rains due

On the whole, we have specifically concluded that an increase in weather disasters will not haveto global warming as well as changes in land use. Thus, in addition to the crisis management measuresa profound impact on our operations as compared to the manufacturing and other industries forof each office, we will promote initiatives to educate and raise awareness of employees and other related

a number of reasons. For example, insurance products represent an intangible service and do notparties.

necessarily require physical sales bases, and their development and production involve minor supply* Toptier agents of Tokio Marine & Nichido, designated as “TOP QUALITY” agents, and Tokio Marine & Nichido Partners, wholly owned
insurance agents of Tokio Marine & Nichido

chain risks such as the procurement of raw materials.
[Context-Specific Approach]Findings from the Analysis of Our Business Offices in Japan (Including the Value Chain):
Number of Business Offices Located in Priority Locations Exposed to Flood Immersion and Landslide Risks

qualitatively and quantitatively, the impact of an increase in weather disasters (such as heavy rains

Located in areas with high risk Located in areas with high riskof flood inundationof landslide disasters

No. of business offices analyzed

Based on a context-specific approach, we use multiple scenarios to analyze and evaluate, both

Domestic Group companies

489

86

3

initiatives to protect our own assets from weather disasters, which are expected to become more

Insurance agents of Tokio Marine & Nichido

665

117

9

severe due to climate change. Specifically, we are examining measures from medium- to long-term

Total

1,154

203

12

and floods) caused by climate change on our operations. Accordingly, we have been promoting(about two to five years) and short-term (within one year) viewpoints and implementing measuresagainst flood disasters, such as installing emergency power generators and more water bars at our
major bases.

[Data Sources]• Flood immersion risk: Based on the digital national land information (areas subject to possible immersion by floods) (by river) (Ministry of Land, Infrastructure,
Transport and Tourism) https://nlftp.mlit.go.jp/ksj/gml/datalist/KsjTmplt-A31a-v4_0.html• Landslide disaster risk: Based on the digital national land information (areas prone to landslide disasters) (Ministry of Land, Infrastructure, Transport andTourism) https://nlftp.mlit.go.jp/ksj/gml/datalist/KsjTmplt-A33-v2_0.html

TCFD Report 2024

17

CEO Message
Climate-related Financial Disclosure
Based on the TCFD Recommendations

1

Governance2

Strategies

3

Risk Management<B. Transition Risks>

4

Metrics and Targets

Transition risks

We have estimated the impact of transition risks on assets under management by Tokio Marine Group

Orderly

Disorderly

-2.1%

-1.6%

Equities

-9.7%

-7.0%

Greening the Financial System (NGFS). More specifically, the quantification of the impact on corporate

Corporate bonds

-1.1%

-0.8%

value has been conducted by comparing the scenario where current policies continue to 2050 (NGFS’s Hot

CMBS

-0.1%

-0.5%

Government bonds

-0.1%

-0.2%

(equities, corporate bonds, commercial mortgage-backed securities – CMBS and government bonds)
using “Aladdin Climate,” a model provided by BlackRock Solutions. With the model, we have quantified
the impact on corporate value due to changes in scenario variables (carbon prices, energy demand, fuelprices, emissions, etc.) based on scenarios provided by The Network of Central Banks and Supervisors for

Total

House World – Current Policies scenario, assuming limited policy changes and a 3.3°C temperature rise at
the end of this century) with the following two scenarios also of NGFS.

❶ Orderly: Net Zero 2050 (Assuming a temperature rise suppressed to 1.5°C and net zero CO2 emission

both by 2050)❷ Disorderly: Delayed Transition (Assuming a 1.8°C temperature rise by 2050 due to delayed policychanges)

The following shows the results of the model-based estimates of transition risks of assets (equities,
corporate bonds, CMBS and government bonds) (impact analysis on asset prices based on scenarios up to* The Aladdin Climate analytics of BlackRock Solutions contained in this report should not be construed as a characterization of
the materiality or financial impact of the corresponding information. The Aladdin Climate analytics includes non-financial
metrics and involves measurement uncertainties resulting from limitations inherent to the nature of the corresponding data
and the methods used for determining such data.
The Aladdin Climate analytics is not fixed and is likely to change and evolve over time. The Aladdin Climate analytics relies on
relatively new analysis methods, and there are limited peer reviews or comparable data available. BlackRock Solutions does
not guarantee and shall not be responsible for the content, accuracy, timeliness, non-infringement or completeness of the
Aladdin Climate analytics contained herein or have any liability resulting from the use of the Aladdin Climate analytics in thisreport or any actions taken in reliance on any information herein.

2050) held by Tokio Marine Group as of March 31, 2024.
It should be noted that the model results used by Tokio Marine Group does not separately calculate thepositive effects (market superiority or business opportunities) generated by technically implementing
climate change mitigation and adaptation measures as we transition to a low-carbon society. Moreover,
we believe that this and other quantification models of climate change are still in the development stage,undergoing upgrades based on the latest research findings. We thus have no plan, at this point, to use thedata shown above in our management decision-making process, but will continue to carry out researchand investigations to explore more appropriate ways to utilize such quantification modeling methods.

TCFD Report 2024

18

CEO Message
Climate-related Financial Disclosure
Based on the TCFD Recommendations

1

Governance2

Strategies❸ Implementation of Climate Change Strategy

Risk Management

34

Metrics and Targets(1) Initiatives to Mitigate Climate Change<A. Initiatives of Tokio Marine Group>① Insurance and Services to Promote the Spread of Renewable Energy

Tokio Marine Group assumes the roles of an insurance company, institutional investor, asset manager,[Acquisition of GCube that Specializes in Underwriting Insurance for Renewable Energy Operators]

global company and good corporate citizen. In every role, we are promoting the creation of a safe, secure

There is momentum toward decarbonization worldwide and a shift to renewable energy in major

and sustainable future to protect our customers and local communities in times of need even 100 years

countries for a more efficient electricity supply. In building and expanding of renewable energy powerfrom now. In the following sections, we describe our initiatives in each role.

generation plants, insurance is indispensable as project financing will not be extended without insurance.

A-1. Initiatives as an Insurance Company (Insurance Products and Services)

In 2020, Tokio Marine Group acquired GCube, a leading company specializing in underwriting insurance

Toward achieving carbon neutral society by 2050, Tokio Marine Group supports the transition to afor renewable energy operators. GCube launched its business in the 1990s when the renewable energy

decarbonized society by providing insurance products and solutions.

market was still in the early stage and there was not much demand for insurance. Currently, having eightout of the 10 world’s leading renewable energy operators as its customers, GCube supports more than

One group company, Tokio Marine & Nichido has established the GX Office, an organization dedicated2,000 projects in 38 countries, with its written premiums amounting to 142 million USD in 2023.

to green transformation (GX), within the Marketing Strategy Department and has been focusing on thedevelopment and provision of insurance products and solutions. Globally, a GX Roundtable was organizedin 2023 to share information and promote initiatives in the decarbonization field. The roundtable has been
discussing possible collaboration and business expansion opportunities among the Group companies. The
following sections highlight specific initiatives of Tokio Marine Group from the perspectives of mitigation
and adaptation, which represent two pillars of climate action.
Two Pillars of Climate Action and Tokio Marine Group’s Key Initiatives<Mitigation>• Insurance and services to promote thewidespread use of renewable energy• Guarantee insurance for electric vehicles andstorage batteries• Recycling and reusing auto parts<Adaptation>• System for responding quickly to natural disasters• Development of claim payments using satellite
imaging and AI• Co-creating solutions through the Disaster
Prevention Consortium (CORE)• Providing solutions by Tokio Marine Resilience• Disaster crisis management response services

Establishment

1987

Location

London, U.K.

Business content

Underwriting insurance specifically covering risks related to renewable energy businessPremiums written

Approx. USD142 million (fiscal 2023)

Insurance products

Construction insurance, cargo insurance for transporting materials, insurance after thecompletion of facility construction, etc.

TCFD Report 2024

19

CEO Message
Climate-related Financial Disclosure
Based on the TCFD Recommendations

Governance1

Strategies

2

3

Risk Management

Metrics and Targets

4

Excellent underwriting capabilities and superior claims service capabilities are essential in underwriting[Insurance and Services to Support Offshore Wind Power Generation]

insurance for renewable energy power plants.

Tokio Marine & Nichido has been underwriting insurance for offshore
wind power generation projects across the world since 2013 when

GCube performs appropriate risk assessment and calculates insurance premiums based on a vast

they were not yet widely known in Japan. The company is now

amount of loss data accumulated over 30 years since its foundation. An underwriting decision is maderegarded as one of the major international players in this field.

while considering factors such as the location of the power plant, the structural type of its foundation,equipment used by contractors and contracts with suppliers and contractors. Evaluating these factors

Offshore wind power generation projects, which require large-

requires a high level of expertise. GCube has made more than 4,000 claim payments since 2011, and its

scale investment, often entail project financing and involve various parties, including the manufacturer

specialized adjusters (loss appraisers) give advice on loss prevention based on accident statistics.

of windmills and other contractors. Thus, an insurance package exclusively designed for such projects
plays a crucial role. Such an insurance package offers comprehensive and seamless total support in orderMoreover, GCube strives to further enhance its underwriting capabilities by quantifying risks according toto cover a variety of risks faced by each party involved in constructing and operating wind farms. As

the service life and usage conditions of each equipment. The company also provides advisory services toa managing underwriter, Tokio Marine & Nichido offers globally competitive coverage in its insurance

customer operators, such as advising them on the conditions of insurance policies (setting an appropriate

package. Contracts related to such projects vary by country or region. Thus, Tokio Marine & Nichido’s

amount of deductible, etc.) according to each risk based on these quantified risks.

insurance policy has been adjusted to their respective conditions to provide appropriate risk coverage. As
for risks specific to Japan, the company
has been actively promoting initiatives

VERTICAL
LIMIT

The average size of individual claims has increased
over the past 10 years
In line with the data in figure
4, the average cost of offshore
wind claims has increased
substantially, up from 1million
GBP in 2012 to over 7million
GBP in 2021 – demonstratinga notable increase in risk
for insurers, developers, andmanufacturers across the sector.

When is bigger not better inoffshore wind’s race to scale?
Q2 2023 Report

The slight decrease in averageclaims size (GBP) between 2021
and 2022 can be accounted
for by the 2-3 years it takes for

A high-level cost comparison ofindividual major components
on 3MW machines vs. 8MW
machines is represented infigure 5. A general rule of thumbis that repair costs increase byroughly 1 million (EURO) per MW.
So, as turbines get larger theircost roughly increase in a linear
fashion. However, figure 5 does
not consider important variables
that affect repair costs, including:claims to work their way throughthe system.
It’s important to note, however,that while the average size loss
continues to increase, a small
number of large losses haveexacerbated the sharp increase.
There are number of factors thathave contributed to the rise inaverage loss size, which include
an uptick across several root
causes, including:■ Defective materials■ Collision■ Defective workmanship■ Mechanical breakdown■ Defective manufacturing■ Construction defect■ Contractor error■ Collapse■ Electrical failure■ Gear box failure■ Transit■ Corrosion■ Fire■ Lightningthat harness its knowledge of maritime

7000000
6000000
5000000
4000000

risks, which has been accumulated

3000000
2000000
1000000

2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022

through its long history and tradition

Figure 4: Average loss size (GBP) vs. time (year)■ The time of year:
winter vs. summer
repairs■ Availability of vessels■ Construction All
Risks (CAR) andOperational All Risks(OAR)■ Wind turbine location■ Consequential
damage■ One off installation or
entire wind farm

■ Storm

Larger wind farms, which arebeing built further offshore, also
represent much larger Total
Insured Values (TIVs). Larger
turbines and components, by
their very nature, are costlier

8000000

3MW

8MW

%

EUR

EUR

Blades24%

720,000

1,920,000

nacelle46%

1,380,000

3,680,000

Top section
Mid section
Bottom section

3%
7%
5%

90,000210,000
150,000

240,000
560,000
400,000

PCM

8%

240,000

640,000

BoM

8%

240,000

640,000

100%

3,000,000

8,000,000

Element
Blades per blade
Blades per blade
Blades per blade

Top sectionof providing hull and cargo insurance,

Mid section

and the experiences of underwriting

Bottom section
BoM rest

Figure 5: Component cost comparison, 3MW vs. 8MW

insurance for marine development

to repair and replace and havelarger business interruption (BI)values associated with them
– therefore contributing to anincreasing share of losses acrossthe sector.

projects.

"$:2;5<'=><2/3-"(5)#789"(&)*,,-./0'1234"#$%&'(@'Determine,'0'3>')*,,-various./0'B2342
3-%0involved
53>' in each phase and create
risks

C'insurance<'0;23'D502/%02-E-23D/:
D'423'5>.F.5-'534>0'5coverage<'23-%053>'F5
G'packageprovidingnecessaryat>aE5price
F0/D
2423G3'>'--the
50H>risks/D'05G'5<5F02>'0',:'><23G<.'02-Ereflecting
IJKMNJOPQRSTJURVN`KRSOJTVOYKRg[[YSSXYUZY[YOPQRSTJURVNdYJ]IUJOPXYUZY[YOP\Q
QRSTJURVN

bN[UPYROUJO M

UYRONRURVNINJYK]

jMNJUOYKRU[g[[YSSUYRONRURVNINJYK]dYJ]IUJOPXYUZY[YOP\TSYRNSSQRONJJTMOYKR \QQRSTJURVNINJYK]^_`a_QbacdIOKSOUJOKeVKffNJVYU[KMNJUOYKR QRSTJURVNINJYK]^gRRTU[JNRNhU[
22

GCUBE Q2 2023 – VERTICAL LIMIT

Report created by GCube

2.

CLAIMS AnALYSIS

23_YRURVYU[`[KSNa_YRU[YRiNSOfNRObNVYSYKRacKOYVNOKIJKVNN]`KffNJVYU[jMNJUOYKR?

01234567815145156 

TCFD Report 2024

20

CEO Message
Climate-related Financial Disclosure
Based on the TCFD Recommendations

Governance1

Strategies

2

4challenges than land projects, we have made a range of efforts to counter these challenges. Given that

11 countries and regions

Japan faces many natural disasters, we have built a risk model specific to the country through industry-

144 projects in total

U.S.
7 projects

Additionally, we have formulated the Guidelines for Marine Warranty Survey in Japan by applying our
experiences in offshore wind power generation projects in Europe and modifying a marine warranty

Metrics and Targets

Projects for which Tokio Marine Group has underwritten insurance

As offshore projects require preparations for typhoons and other natural disaster risks and pose greater

academia collaboration with the Nippon Kaiji Kyokai (known as ClassNK) and Kyoto University.

Risk Management

3

EU /U.K.
117 projects

survey, which is common in Europe, to match the actual state of construction and other relatedJapan
7 projects

Taiwan8 projects

contractors and weather conditions in Japan.
At Tokio Marine & Nichido, premiums related to offshore wind power generation increased by about 2.8[Insurance Package for Solar PPA Operators]

billion yen from fiscal 2020 to fiscal 2023. The number of projects is expected to increase further, and we

Tokio Marine & Nichido offers Insurance Package for Solar PPA Operators, an insurance product providing

anticipate continued, sharp market growth both in and outside Japan.

power purchase agreement (PPA) operators with comprehensive coverage for various risks, including therisk of damage to power generation facilities, third party liability risk arising from the management ofElectricity generated by offshore wind power
Globalfacilities and risk of the user (company using the facilities) going bankrupt.

Japan

600600

（GW）
（GW）

（GW）
（GW）

4004002002000090 9010010024-fold
24-fold

562562

23 23
2018
2018

2040
2040

6 6
180-fold180-fold

50 50

0

0

0.5 0.5

2022
2022

10 10

2030
2030

In recent years, a PPA model has drawn much attention on the back of the

30〜45
30〜45

growing need to use renewable energy. It is a business model in which a

15〜20
15〜20

third party installs its own renewable energy facilities on the roof of the user’s
2035
2035

2040
2040

building or within its premises by incurring the installation costs, and supplies

2050
2050

Source: Vision for Offshore Wind Power Industry (1st Draft), materials from the Japan Wind Power Association andpartially surveyed by Tokio Marine Holdings

generated power to the user while recovering these and other costs throughTokio Marine & Nichido now has underwritten insurance for 85 projects in 11 countries and regions. Adding

energy is expected to continue via this model, as it has the advantage of

those underwritten by GCube, the Group has underwritten insurance for as many as 144 projects. Offshore

eliminating the associated initial cost for the user. There is, however, a risk that the originally planned costwind power generation is said to play a crucial role in shifting our main power source to renewable energy.

recovery would be difficult for reasons such as unexpected and sudden accident during the term of theGoing forward, we will continue to leverage the Group’s strengths to generate synergies, support offshore

contract. By offering this insurance package, the company contributes to the promotion of renewablewind power projects globally and contribute to the transition to a decarbonized society.

energy based on the solar PPA model.
0a long-term PPA with the user. An increase in the introduction of renewable

0

TCFD Report 2024

21

CEO Message
Climate-related Financial Disclosure
Based on the TCFD Recommendations

1

Governance2

Strategies

3

Risk Management

4

Metrics and Targets② Guarantee Insurance for Electric Vehicles and Storage Batteries③ Recovery and Reuse of Auto Parts from End-of-Life Vehicles

Guarantee insurance provides coverage for damage or loss caused by performance defects in products.

The Ellen MacArthur Foundation is an internationally well known organization promoting circular

By providing guarantee insurance, U.K. based Tokio Marine Kiln (TMK) supports the transition to aeconomy. It released a report entitled “Completing the picture: How the circular economy tackles climate

decarbonized society.

change,” which states that a transition to renewable energy, complemented by energy efficiency, can only
address 55% of global GHG emissions while reducing the remaining 45% requires a circular economy and

The spread of EVs, which do not emit CO2, will lead to decarbonization, but buyers, especially thosetransformation of the way we make and use products.

wishing to buy used EVs, are concerned about possible defects in the performance of batteries and othercomponents. In response, TMK offers guarantee insurance for used EVs to cover the damage caused by

Tokio Marine & Nichido, E. design Insurance and Nisshin Fire acquire end-of-life vehicles in exchange for

performance defects or failure so that consumers can buy these EVs with a sense of reassurance. This

the payment of insurance claims. The three companies collect materials from the vehicles’ taillights andwill also lead to a longer lifespan of EVs, which in turn will reduce the disposal of raw materials and CO2

airbags through a network of auto dismantlers and work with a chemical manufacturer to recycle andemitted from the manufacturing processes.

reuse them again as raw materials.

For operators generating power using renewable energy, a gap between the amount of electricity

This initiative both serves to reduce waste through circular economy and helps achieve decarbonization.

generated and the demand for electricity poses a challenge, as the supply of renewable energy is unstable

For example, recycling acrylic resin from used taillights can reduce CO2 emissions by 50% compared toand is easily affected by weather. As a solution, systems to store electricity generated by operators

newly manufactured acrylic resin.

have been drawing much attention. TMK also provides guarantee insurance for such systems and iscontributing to the spread of the electricity storage systems as well as an expansion of the renewable

As insurance companies handle many end-of-life vehicles, we will continue to contribute to theenergy power generation market.

achievement of decarbonization by expanding the recovery and reuse of auto parts.

Battery Energy Storage System

End-of-life vehicles

Acrylic resin recycled from end-of-life taillights

TCFD Report 2024

22

CEO Message
Climate-related Financial Disclosure
Based on the TCFD Recommendations

1

Governance2

Strategies

3

Risk Management

4

Metrics and Targets(2) Initiatives to Adapt to Climate Change② Development of Claims Payments Using Satellite Imaging and AI

We cannot eliminate natural disasters, but we can reduce damage by mitigating the vulnerabilities in

Tokio Marine & Nichido began working with ABeam Consulting Ltd. to pay insurance claims using

society, as described in the Scenario Analysis section. Accordingly, Tokio Marine Group has been focusing

satellite imagery in 2018. To increase the level of sophistication of these activities, the company has beenon providing solutions to prevent damage, reduce damage when a disaster does occur and support earlycollaborating with ICEYE, which possess advanced satellite image analysis technologies.

recovery.
Mainly in the event of a flood disaster, this initiative will enable a more detailed calculation of damage① System for Responding Quickly to Natural Disasters

and the height of flooding using AI to analyze data, including images on social media and data fromJapan has been struck by a number of natural disasters such as typhoons and floods in recent years,

immersion sensors in addition to acquired satellite images. The data will be combined with Tokio Marine

causing serious damage across the country. If a large-scale disaster occurs, Tokio Marine & Nichido& Nichido’s customer data, such as location and property information, to determine the damage on apromptly establishes disaster response offices, satellite offices (temporary offices to conduct damage

customer-by-customer basis and significantly reduce the time before customers receive their insurance

assessment and other operations in disaster-stricken areas) and backup offices (insurance claim

claims.

centers) to facilitate speedy initial response. The company’s IT network enables claims service offices
across Japan to exchange and share information in real time, which in turn allows for providing

This initiative was highly valued and awarded the Claims Initiative of the Year – Japan at the Insurance Asia

support smoothly from remote regions. Tokio Marine & Nichido makes company-wide efforts, withAwards 2021 hosted by the Charlton Media Group.

employees, loss appraisers and adjusters dispatched to the disaster areas visiting customers affectedby the disaster to check on damages to houses and other properties, in order to quickly pay insurance

Tokio Marine Holdings and ICEYE have concluded a capital and business alliance in February 2022.

claims using digital, AI and other technologies.

This alliance is aimed at advancing various
initiatives, including the digital transformation

We have installed a system to check damageof insurance claim services related to natural

remotely, thereby setting up a structure

disasters and the joint development of new

to maintain our claims services even wheninsurance products and services, by leveraging

employees are unable to come to the office

ICEYE’s technologies for high-precision,

due to an infectious disease or disaster.

high-frequency earth observation and its
technology development team dedicated tothe insurance field to help solve diverse social
issues.

Overlaying the extent of a flood disaster analyzed
by AI on a satellite image

TCFD Report 2024

23

CEO Message
Climate-related Financial Disclosure
Based on the TCFD Recommendations

1

Governance2

Strategies

3

Risk Management

4

Metrics and Targets③ Co-Creating Solutions through Disaster Prevention Consortium (CORE)④ Providing solutions by Tokio Marine Resilience

CORE was established by 14 companies in November 2021, with Tokio Marine & Nichido being the initiator.

In November 2023, Tokio Marine Group established Tokio Marine Resilience Co., Ltd., a Group company(As of May 31, 2024, it has 115 member companies.) It is aimed at establishing specific measures suchspecializing in the solutions business in the disaster prevention and mitigation domain. The company has

as the creation and market deployment of new services for accelerating and promoting new initiatives

launched this new business to offer value to all phases of the disaster prevention and mitigation value

related to the prevention and mitigation of disasters in line with the Fundamental Plan for National

chain (assessment, preparedness, evacuation, recovery/reconstruction) and started providing disaster

Resilience.

prevention and mitigation services.

Understanding
the current situation

Taking action

Monitor measurements to

Formulate risk assessments. Implement disaster

analysis technologies.

and management.

stay upto dateprevention
design,a year to
The Consortium includes a plenary session and subcommittees.
The
plenary sessionconstruction,
meets
twice
on changes. Enhanceinspection

The services provided by Tokio Marine Resilience include a supply chain management service, which

address the domain of co-creation, enabling government officials and experts
to share information about
Resilientvisualizes risks in the entire supply chain by employing the resilient information distribution service that

Rebuilding
market trends and other topics. The subcommittees focus (mitigating
onEvacuatingcompetition-related
domains,
combiningpeople’s lives
damage)allows real-time risk monitoring and using data from weather and disaster information.

society

Supportthe mitigationof
Disseminate
the strengths of multiple corporations to promote researchandthe developmentdamageofsolutions.
Currently,(initial action). Support
weather information andthe prevention of recurrence
evacuation information. Underthe Consortium has 10 subcommittees and many of them
have
startedfield tests andsimilaractivities.
(permanentaction).
standdamagein real time.

In developing services, the company also utilizes solutions co-created by the CORE consortium. Tokio

Examples include the development of disaster detection technology to identify signs that a disaster will

Marine Resilience will continue to evolve its disaster prevention and mitigation services.

occur and the status of disasters using camera
imagery and the development of technology
to save labor and streamline damage surveys
using sensors and satellites. These co-creation
solutions are a unique feature of the Consortiumthat fosters cross-industrial cooperation.
Understanding
the current situation
Monitor measurements tostay up to dateon changes. Enhance
analysis technologies.

Evacuating

Taking action

Resilientsociety

Formulate risk assessments. Implement disasterprevention design,
construction, inspection
and management.

(mitigating damage)

Rebuilding
people’s lives

Disseminate
weather information andevacuation information. Understand damage in real time.

Support the mitigation ofdamage (initial action). Support
the prevention of recurrence(permanent action).

Current agenda of subcommittees
Use of remote sensing to identify infrastructure
maintenance and management risks

Current agenda of subcommittees
Use of remote sensing to identify infrastructure
maintenance and management risks
Real-time hazards
Risk assessment encompassing all hazards; application of risk assessment to community development
and disaster-preparedness measures
Discussion of BCP from a community-based
perspective to supply pharmaceutical products inthe event of a disaster
Information services to maintain logistics functions
and business continuity in the event of a water
disasterPrediction of disasters that would necessitateevacuation

Resilient information distribution service

Use of digital technologies to survey damage andaccelerate recovery and reconstruction
Research into new disaster-preparedness information systems and using these systems to consider
disaster-preparedness businesses

Supply chain management service

Use of timelines to prevent damage to key facilities
such as hospitals and to enable them to continuefunctioning in the event of a flood
Comprehensive resilience support service forbuildings and building use

TCFD Report 2024

24

CEO Message
Climate-related Financial Disclosure
Based on the TCFD Recommendations

1

Governance2

Strategies

3

Risk Management

4

Metrics and Targets⑤ Disaster and Crisis Management Response Services(3) Reinforcing Engagement

The U.S.-based PURE Group of insurance companies has launched the Situation Room (crisis management

The preceding sections describe specific examples of products and services we provide as an insurance

center) to provide customers with damage mitigation advice and inform them of accident-reporting

underwriter. In addition to these efforts, we also believe engagements on the theme of the environment

contact points. The Situation Room constantly monitors highly precise weather information and online

with business partners are essential in transitioning to a decarbonized, carbon-neutral society. To date,

information such as news and social media posts to accurately identify natural phenomena with the

Tokio Marine & Nichido has made engagements with more than 250 companies, of these the company

potential of causing damage to customers. When the Situation Room recognizes any danger of disaster,

has offered solutions to resolve various issues to more than 120 companies while leveraging its expertise.

it overlays the anticipated disaster region and customers’ addresses on a map and immediately contacts
customers to protect their safety if they are exposed to the risk.

As one engagement example, Tokio Marine & Nichido has been holding dialogue with power plants forwhich the company has provided insurance. The company encourages them to consider the environment

The United States has experienced many large-scale wildfires in recent years, and minimizing the resulting

through the adoption of innovative high-efficiency power generation technologies and carbon dioxide

damage has become a pressing issue. Since 2020, the Situation Room has provided alerts for customers on

capture, utilization and storage technologies (CCUS/carbon recycling) that reduce GHG emissions andvarious risks facing them. Its activities include closely examining roughly 2,400 wildfire warnings issued by

supports their transition by providing relevant products and consulting services.

local governments, dispatching private fire companies to about 100 wildfire sites in 12 states and making
hundreds of phone call alerts.

To strengthen engagement dialogues further, Tokio Marine & Nichido has set a target to conductengagements with 200 large corporate customers, which account for approximately 90% of its insurance-

Hailstorms are also a major weather disaster in the United States, causing considerable damage withassociated emissions. Of these corporate customers, the company aims to make deeper engagements

hailstones, sometimes the size of tennis balls. The Situation Room also notifies customers of the detectedwith 160 companies by 2030.

hailstorms and works to prevent secondary damage through efforts such as accounting for their
whereabouts and checking the damage on house roofs.

Since November 2022, Tokio Marine & Nichido has also been providing, jointly with MUFG Bank, Ltd., aservice to support disclosures of climate change risks and opportunities and other related information inaccordance with the TCFD recommendations as a service solution to help companies promote GX.

TCFD Report 2024

25

CEO Message
Climate-related Financial Disclosure
Based on the TCFD Recommendations

1

Governance2

Strategies

3

Risk Management

4

Metrics and Targets

A-2. Initiatives as an Institutional Investor (Investment and Financing)

Furthermore, the company continued its endeavor to make impacts in new fields that will help conserve

Tokio Marine Group recognizes that climate change and loss of natural capital are issues that are closely

natural capital and made investment commitments in a forestry fund and agriculture strategic investment fund.

linked. As such, we engage in ESG investment and financing, which gives appropriate consideration to theenvironment, social and governance (ESG) factors encompassing these two issues while supporting the[Real Estate Climate Impact Fund That Focuses on Climate Action]transition to a decarbonized society and conservation of natural capital.

In fiscal 2023, we signed through Tokio Marine & Nichido anagreement to invest in the Fidelity European Real Estate Climate

Specific efforts include constructive and purposeful dialogue with investment and financing recipients,

Impact Fund, which addresses climate change issues through thewhich encompasses ESG issues; ESG integration where both financial and non-financial data are usedacquisition and renovation of commercial real estate in Europe.

in the investment decision-making process; and addressing specific sectors based on climate change aswell as environmental and social risks. We have also been promoting efforts to become nature positive inThis fund aims to implement sustainability-enhancing renovations

2030 and carbon neutral in 2050 in our investment and financing portfolios. Additionally, mainly Groupto existing buildings acquired through real estate investments to reduce GHG emissions and improveinsurance companies in Japan have been engaging the lead in generating sustainability outcomes for

asset value and well-being of users. Through the investment, Tokio Marine & Nichido financially aids theresolving environmental and social issues through sustainability-themed investment and financing as wellclimate action in the real estate sector and provide support for achieving a net-zero society.

as impact investing.
[Investment in a Forestry Fund]
Sustainability-themed investment and financing include investment in green bonds, sustainability bonds

In fiscal 2023, we signed through Tokio Marine & Nichido an

and transition bonds. Additionally, Tokio Marine & Nichido executed its first green loan and invested inagreement to invest in the Manulife Forest Climate Fund, which

Japan’s first blue bonds in fiscal 2022. The use of funds obtained through these blue bonds is limited toinvests globally, including in the United States and Australia.

the prevention of marine pollution and businesses related to sustainable fishery resources. In February
2024, the company also invested in the GX Economy Transition Bonds (climate transition bonds), issued

This fund manages forests mainly to acquire carbon credits thatfor the first time by the Japanese government, as an effort to make impacts in a new field.

are receiving growing expectations for their role in reducing GHG
emissions. It plans to acquire international certification to promote sustainable forest management, such

In fiscal 2022, Tokio Marine & Nichido established a team to carry out impact investing that generates bothas the Sustainable Forest Initiative (SFI) and Forest Stewardship Council (FSC) certification, for the forests itsocial and economic value and has made investment commitments to renewable energy and other funds

manages. Through the investment, Tokio Marine & Nichido financially aids forest management to enableconducive to counter climate change. In fiscal 2023, in addition to renewable energy funds, the company

longer intervals of logging and improved forest management, including tree planting, and support

made investment commitments in a real estate climate impact fund that focuses on climate action.

conservation of natural capital and achievement of carbon neutrality.
TCFD Report 2024

26

CEO Message
Climate-related Financial Disclosure
Based on the TCFD Recommendations

1

Governance2

Strategies

3

Risk Management

4

Metrics and Targets[Investment in an Agriculture Strategic Investment Fund]

A-3. Initiatives as an Asset Manager (Fund Formation)

In fiscal 2023, we also signed through Tokio Marine & Nichido

Tokio Marine Asset Management has been operating renewable energy funds targeting investments inan agreement to invest in the Macquarie Agriculture Fund Cropsolar power plants since 2012, effectively supporting initiatives aimed at the transition to a decarbonized

Australia 2, a fund to invest in Australian farmland and agriculture-society.

related businesses.

Performance of renewable energy funds (Total as of March 31, 2024)

This fund mainly invests in companies that own and operate

Amount committed ……………… Approx. 48 billion yen

farmland in Australia and promotes environmentally friendly operations, such as the use of renewable

Units installed

energy, the reduced use of pesticides and fertilizers by introducing the latest technology and afforestation

Power generation capacity (DC) … Approx. 280 MW…………………… 43

in abandoned farmland. Through the investment, Tokio Marine & Nichido provides financial support
to sustainable agricultural operations for the ultimate goal of reducing GHG emissions and conserving

By leveraging its financial strengths, Tokio Marine Asset Management also aims to contribute to thebiodiversity while also supporting the agriculture sector to address climate change and nature-related

promotion of decarbonization and conservation of biodiversity in the marine and agricultural fields. In

issues for achieving carbon neutrality.

fiscal 2023, the company newly partnered with two venture companies and started exploring new growth
opportunities.

The Group’s balance for sustainability-themed investing and financing and committed amount for impact
investments as of March 31, 2024, are as shown below.

Faeger Co., Ltd., one of the two new partners, develops, creates and sells agricultural carbon credits. By

Investment cases

Investments and financing
as of March 31, 2024 *Sustainability-themed investments andfinancing

138 billion yen

Impact investing

29 billion yen* Total balance of Tokio Marine & Nichido, Tokio Marine & Nichido Life and Nisshin Fire for sustainabilitythemed investments and financing; Total committed amount of Tokio Marine & Nichido for impact
investingutilizing these credits created by Faeger, Tokio Marine Asset Management seeks to realize a decarbonizedsociety, the development of regional economies and environmental protection.
The other company, Innoqua Inc., has a proprietary “environmenttransfer technology,” which enables the modeling of a marine
environment for laboratory-level environmental analysis. Jointlywith Innoqua, Tokio Marine Asset Management is exploring thepossibilities of blue carbon. To promote the reduction of GHG

Through these initiatives, Tokio Marine Group contributes to becoming carbon neutral and natureemissions and conservation of biodiversity, the company has been

positive.

engaging in joint research with Innoqua in Ishigaki City, Okinawa
TCFD Report 2024

27

CEO Message
Climate-related Financial Disclosure
Based on the TCFD Recommendations

1

Governance2

Strategies

3

Risk Management

4

Metrics and Targets

Prefecture, since 2023 to restore tape seagrass beds. The project is conducted with the cooperation of arecommendations. The company has contributed to the publication of the final report of the UNEP FI pilot

local nature conservation group and a local elementary school.

project, entitled “Insuring the climate transition,” in January 2021.

Tokio Marine Asset Management aims to become an institutional investor that acts to solve problems,[The Geneva Association]

becomes a new form of asset manager and proactively engages in social issues by bridging those needing

The Geneva Association is an insurance industry think tank composed offunds, those having relevant technologies and those supplying funds.

approximately 70 CEOs from major insurance companies around the globe.
Since 2008, we have led discussions at international conferences, which

In 2022, Tokio Marine Asset Management became a signatory to the Net-Zero Asset Managers Initiative

includes co-chairing a climate change-related working group for the Geneva Association. We have also

(NZAM), an initiative of an international group of asset managers. As a responsible asset manager, thejoined the Association’s climate change task force and have been engaging in the formulation of scenario

company will endeavor to realize a decarbonized society.

analysis and stress test guidelines to perform forward-looking impact assessment of climate change.

A-4. Initiatives as a Global Company (Leading Research and Discussions at International Climate[ClimateWise]

Change Conferences)

Tokio Marine Kiln and Tokio Marine HCC International from Tokio Marine

As climate change is an important social issue that needs to be addressed by the entire world, TokioGroup have joined ClimateWise, a climate change-related international

Marine Group works closely with international organizations, governments, industries and academic

initiative in the insurance industry. They have been carrying out studies andcommunities as well as actively engages in dialogue with NPOs and NGOs. Tokio Marine Group is

research on various risks and opportunities related to climate change jointly

contributing to the creation of international rules and the progress in research on climate change andwith about 30 leading insurers in the world.

natural disaster risks through international initiatives and weather disaster research.
[Sustainable Markets Initiatives](1) Participation in Initiatives in and outside JapanWe are also the only Asian company to be a member of the Sustainable[UNEP-FI]

Markets Initiative, an insurance industry task force envisioned by the thenIn July 2018, Tokio Marine & Nichido became a founding member of the

Prince Charles of the United Kingdom and established in June 2021.

insurer pilot group, launched by the United Nations Environment Programme
Finance Initiative (UNEP FI) under the Principles for Sustainable Insurance (PSI)
framework to examine and develop methodologies and analytical tools forthe insurance industry to make climate-related disclosures based on the TCFD
TCFD Report 2024

28

CEO Message
Climate-related Financial Disclosure
Based on the TCFD Recommendations

1

Governance2

Strategies

3

Risk Management

4

Metrics and Targets[Partnership for Carbon Accounting Financials (PCAF)]
PCAF is an international initiative to develop methods for measuring and[GX League]

disclosing GHG emissions associated with investment and financing, and

The GX League was established as a forum to enable companies pursuing green

Tokio Marine & Nichido joined in January 2022. In November 2022,

transformation (GX) and sustainable growth to achieve carbon neutrality and social

PCAF developed and made available a method for measuring GHG emissions related to insurance

transformation. It collaborates with other companies working for the same goals as

underwriting portfolios. Tokio Marine & Nichido participates in discussions at the initiative and at the same

well as governments, universities and academic institutions. Since endorsing thetime aims to improve the quality of dialogue with its insurance customers and recipients of investments

basic concept of the GX League in April 2022 and joining the forum in May 2023, Tokio Marine & Nichido

and financing toward achieving decarbonization.

has been actively working as a leader of the GX Management Promotion Working Group. The company
has deeply engaged in discussions led by the working group on the Basic Principles of Disclosure and[TCFD Consortium]

Evaluation of Climate-related Opportunities and contributed to the formulation of these principles.

In Japan, the then Chairman of the Board of Tokio Marine Holdings
worked as one of the founders and contributed to the establishment[Taskforce on Nature-related Financial Disclosures (TNFD) Forum]of the TCFD Consortium in May 2019. After the establishment, Tokio

TNFD is an initiative launched in June 2021 by the UNEP FI, Global

Marine Holdings has been a member of the Planning Committee toCanopy and the World Wildlife Fund (WWF). Tokio Marine Holdings

deliberate on the consortium’s course of action. We have contributed to the creation of three versions ofjoined TNFD in January 2022. By establishing a framework for

the TCFD Guidance released in December 2018, July 2020 and October 2022, respectively, and “A Guide todisclosing nature-related financial information and encouraging

Flood Risk Assessments for Enhanced TCFD Disclosures” released by the Ministry of Land, Infrastructure,companies to disclose nature-related information, TNFD aims to shift global financial flows toward nature-

Transport and Tourism in March 2023. We also participate in discussion on effective ways for companies topositive outcomes. Tokio Marine Holdings has registered as an early adopter and published the TNFD

disclose climate-related information and how to link the disclosed information to appropriate investment

Report based on TNFD recommendations in March 2024.

decision-making of financial and other organizations.

TCFD Report 2024

29

CEO Message
Climate-related Financial Disclosure
Based on the TCFD Recommendations

Governance12Strategies

3

Risk Management

4

Metrics and Targets(2) Research Activities through Industry-Academia Collaboration[Joint Research with The University of Tokyo: Forecasting Future Changes in Typhoon Risk Using

Tokio Marine Group seeks to promote research on climate change and natural disaster risks in

Climate Model Data]

collaboration with the world’s leading scientists and researchers and to use research outcomes andIn joint research with The University of Tokyo, which started in 2007, we have developed an original

other various findings broadly to the benefit of society. Simultaneously, as a corporate group engaging

stochastic typhoon model and investigated the relationship between global warming and changes

in the insurance business, we intend to translate our research activities into the ability to sustainably

in typhoons. The research to date has revealed that global warming will cause typhoons to take more

provide insurance products and related services to customers and local communities. In response, theeastward tracks and become stronger, increasing the number of typhoons reaching their maximum

Tokio Marine Research Institute engages in research on climate change and natural disaster risks throughstrength near Japan. These findings generally align with the content of the IPCC assessment reports.

industry-academia collaboration. The following describes its efforts in cooperation with universities.

In fiscal 2021, we updated the global warming dataset we use for simulation to the Coupled Model
Intercomparison Project Phase 6 (CMIP6), the latest dataset that has contributed to the creation of theOverall Picture of Research on Natural Disaster Risks

IPCC Sixth Assessment Report. Using the dataset, we have been forecasting future changes in typhoons in
respective global warming scenarios.

Forecasts of future changes
The Universityof Tokyo
Simulation using
a stochastic typhoon model[Joint Research with Nagoya University: Analysis of Typhoons and Torrential Rain in the Future
due to Global Warming]

Nagoya University

Collaboration
Joint
research

Since 2010, joint research has been conducted with Nagoya University to forecast how typhoons andJointresearchtorrential downpours will change along with global warming. We have simulated how past typhoons will
Typhoon risk

Flood disaster risk

Simulation of precipitation
during a typhoonchange under future climate conditions to forecast changes in typhoon-induced rainfall and non-typhoon
precipitation. More recently, we have made stochastic future forecasts based on the enormous number

Joint
research

Kyoto University

Forecast of river flow volume
Conceptual
diagram ofrainfall runoff
model

Slope unitof simulation results through the early adoption of the Database for Policy Decision-Making for Future
Dispatch ofvisiting
researchers

Yokohama National
University

Climate Change (“d4PDF”) developed by the Japan Meteorological Agency’s Meteorological Research(Typhoon Science andTechnology Research Center)

Institute (MRI) and other organizations. We are currently carrying out research to forecast future changes

Power generation concept harnessing typhoon energy

in impacts from typhoon-induced rainfall and wind.

Notional image of typhoon
power generation vessel← Flow direction

TCFD Report 2024

30

CEO Message
Climate-related Financial Disclosure
Based on the TCFD Recommendations

1

Governance2

Strategies

3

Risk Management

4

Metrics and Targets[Joint Research with Kyoto University: Assessment of Flood Disaster Risk under Future Climate

key stakeholder alongside customers, society, employees and shareholders/investors in 2021. We haveConditions]

been undertaking activities to contribute to future generations with three activity themes focusing on

Since 2012, in joint research with Kyoto University, we have forecast future changes in river flow volume

restoration of natural capital and response to climate change, nurturing the leaders of tomorrow andby using a rainfall runoff model to simulate river flow volume based on precipitation data. After building

promoting a circular economy.

a rainfall runoff model for river valleys in Japan, including the Arakawa River, we have customized it andexpanded its scope to include the Red River in Vietnam and the Chao Phraya River in Thailand, enabling

Mangrove forests have an effect on the prevention and mitigation of global warming by absorbing

the use of the model for river valleys that are considerably different from those in Japan. Regarding

and fixing a significant volume of CO2. Under the concept of “Insurance for the Future of the Earth,”

precipitation data used in our simulation, we have been an early user of the d4PDF and performed

Tokio Marine & Nichido has engaged in the Mangrove Planting Project since 1999. As of March 31,

stochastic flood disaster risk assessment based on thousands of precipitation data patterns. Currently,

2024, approximately 12,567 hectares of mangrove forest have been planted through this project inour ongoing research aims to build a more versatile model that enables the forecast of wide-area floodnine countries, primarily in Asia. In addition to Tokio Marine & Nichido, other Group companies are

disasters, including small and medium-sized rivers.

now planting mangroves. We have also announced the Mangrove-Based Value Co-creation 100-Year
Declaration, which aims to create value through the blessings of nature brought by mangroves in[Yokohama National University: Research at the Typhoon Science and Technology Research Centercollaboration with forestry NGOs. Under the declaration, we will continue to undertake this project in thefor Generating Power Harnessing Energy from Typhoons]

future.

Typhoons can be a threat, but from a different perspective, they are simply a mass of energy. If we could
harness this massive amount of energy and use it as a resource, we would acquire a new energy source

In 2022, we launched activities to protect and restore eelgrass beds. Eelgrass is a type of seagrass,that would contribute to the realization of a decarbonized society. The Typhoon Science and Technology

which grows in sandy, shallow waters with sunlight and gentle waves. It has a high ability to absorb andResearch Center of Yokohama National University was established in 2021 as Japan’s first research institutesequester CO2 from the atmosphere as well as purify water. Together with mangrove forests, we will

specializing in typhoons. It has since been conducting research toward the realization of power generation

promote this initiative as an effort to protect the global environment.

using energy from typhoons. The Tokio Marine Research Institute dispatches its researchers to the Centeras visiting researchers to make contributions in terms of research activities and the social implementationof research outcomes together with the Center’s researchers and other companies.
A-5. Initiatives as a Good Corporate Citizen (Social Contribution)
In keeping with our strong awareness that “it is our responsibility to pass on the irreplaceable global
environment to future generations in a sustainable condition,” we designated “future generations” as a

Activities to plant mangroves (Malaysia)

Protecting and restoring eelgrassbeds (Japan)

Tree planting activity (United States)

TCFD Report 2024

31

CEO Message
Climate-related Financial Disclosure
Based on the TCFD Recommendations

1

Governance2

Strategies

3

Risk Management

4

Metrics and Targets

Since 2015, Philadelphia Insurance Companies (PHLY) has partnered with a local foundation to engage in a

Tokio Marine & Nichido’s “Green Lessons” and “Disaster Preparedness Lessons” have been attended by atree planting program. Throughout the United States, record wildfires, storms and other natural disasters,

total of 60,000 and 95,000 participants, respectively. These lessons have expanded globally and are now

such as the Hawaii wildfires in August 2023, have destroyed millions of trees in recent years. PHLY and theprovided in Indonesia, Vietnam and China, among others.

foundation helped the planting of approximately 570,000 trees over the eight years from 2015 to 2023.
This, in turn, has sequestered 344,766 metric tons of CO2.

We will continue to reinforce our tree planting and educational initiatives to pass on a sustainable
environment and society to future generations.

At every age, educating and enlightening children who will lead the future are a great responsibility adults
must assume. Tokio Marine Group is visiting schools to provide “Green Lessons” and “Disaster Preparedness
Lessons” to children to raise their awareness of climate change mitigation and adaptation.
Number of Lessons Provided in School by Tokio Marine & Nichido (as of March 31, 2024)
LessonGreen Lessons
Disaster Preparedness
Lessons

Year oflaunchTotal No. of lessons provided

2005

921

2012

Total No. of participants
Disaster Preparedness Lesson (Vietnam)

1,483

Green Lesson (Indonesia)

60,00095,000◆ New Head Office Building ◆Tokio Marine Holdings’ new head office building is slated to be complete
in fiscal 2028. It will be a 100-meter-high head office building madeof trees, the world’s largest wooden hybrid structure at the time of its
completion, which uses an unprecedented amount of domestic fireretardant wood for its structural components, such as pillars and floors.
Wood is an excellent eco-friendly construction material that absorbs andstores CO2 during the process of growth. By utilizing a large quantityof domestic timber and through other CO2 reduction measures, we
can reduce the amount of CO2 emitted during the construction of thebuilding by approximately 30% compared to when constructing regularbuildings. In addition, we will contribute to saving energy and realizing adecarbonized society by introducing highly energy-efficient facilities anda district heating and cooling system and using 100% renewable energy
for our electricity consumption.

TCFD Report 2024

32

CEO Message
Climate-related Financial Disclosure
Based on the TCFD Recommendations

1

Governance2

Strategies

3

Risk Management

4

Metrics and Targets<B. Policies Concerning Insurance Underwriting as well as Investment and Financing>

For projects that relate to any of the specific sectors but may be subject to special consideration*3, we

Our basic policy on climate change is to support the decarbonization of customers and local communities

determine whether to underwrite insurance by using an escalation process, through which a dedicatedthrough insurance products and services as well as investments and financing while basing our activities

team will perform risk assessments. We seek the approval of the Sustainability Committee if necessary.

on constructive dialogue with stakeholders. We individually set up a policy on each transaction for theareas that could cause significant, negative impacts on the environment or society.

In fiscal 2023, we received inquiries for four projects in the specific sectors. Of these, three were deemed
eligible and underwent an assessment by the dedicated team.

Insurance Underwriting and Investment and Financing in Specific Sectors
Tokio Marine Group has not provided new insurance underwriting and financing capacities to coal-fired
power generation projects since September 2020 or thermal coal mining projects since September 2021,
regardless of whether they are newly constructed or not. However, we may grant exceptions for projects
with innovative technologies and approaches, such as CCS/CCUS*1 and mixed combustion, aiming to*1 Carbon dioxide capture and storage/Carbon dioxide capture, utilization, and storage*2 Exemptions for projects with decarbonization plans that are aligned with the Paris Agreement*3 Projects with innovative technologies and approaches, such as CCS/CCUS and mixed combustion which contribute toachieving the goals set in the Paris Agreement, and projects conducted by companies with decarbonization plans alignedwith the Paris Agreement will be carefully decided after analyzing their ESG risks.

achieve the goals of the Paris Agreement, after careful consideration.
Since September 2022, Tokio Marine Group has
also strengthened its commitment by protecting
the environment and supporting the transition to a

エスカレーションプロセス（保険引受）In the specific sector

Decline transaction

decarbonized society by no longer providing newNoinsurance underwriting and financing capacities tooil and gas company extraction projects*2 in the Arctic
Circle (all areas north of latitude 66°33, including theArctic National Wildlife Refuge, ANWR) and oil sands

Prospective transaction

In the specific sector
but may fall under
special consideration

mining.
Tokio Marine Group has established a strict underwriting
management process for specific sectors that we deem

ESG risk and other projectassessment by
Sustainability Committee(dedicated team)

Falls under special
consideration andenvironmental andsocial risks are mitigatedYes

Not in the specificsector

Proceed with transaction

to pose a high risk to the environment and society.
TCFD Report 2024

33

CEO Message
Climate-related Financial Disclosure
Based on the TCFD Recommendations

1

Governance2

Strategies

3

Risk Management

Metrics and Targets

4

Engagement with High-Emission Companies

Of the 200 large corporate customers, 60 companies are in high GHG-emission sectors, accounting

In September 2023, Tokio Marine & Nichido set an interim target of holding dialogue with 200 large

for about 70% of Tokio Marine & Nichido’s insurance-associated GHG emissions. In March 2024, the*1

corporate customers , which account for approximately 90% of the company’s insurance-associated GHG

company set a policy that it will request these 60 companies to formulate decarbonization plans throughemissions, and achieving Level 2 or higher engagement with more than 160 customers by 2030.

engagement and will no longer provide insurance underwriting, investment and financing for companies
that fail to have plans in place. The company will reinforce its engagements with business partners to help

Level

1.

TopicsIdentify issues

Activities
Understand customer’s decarbonization plans and initiatives based on
the company’s management plan, IR reports, etc., while presenting ourlist of decarbonization solutions.
Provide concrete solutions after creating a shared understanding ofissues with each company

2.

Make proposal
based onidentified issues

Support introduction of renewable energy, conduct risk assessment andunderwrite insurance to mitigate risks
Provide consultation services for climate change-related information
disclosures and formulation of decarbonization plans, etc.

3.

Provide insurance
and solutions

insurance customers and investment and financing recipients create decarbonization plans and realize
the transition to a decarbonized society.

GHG-intensive sectors

Power (coal), oil and gas,transportation, real estate,steel, cement, aluminum andagriculture

Number ofcompanies

Policy60

We will require companies to have a decarbonization
plan in place and will no longer provide insurance
underwriting*2 investment and financing*3 for companies
that fail to have them by 2030.

*2 Insurance policies for employee benefits are excluded.
*3 Equity, Bond and Corporate financing

Support customers’ transition through our proposed list of solutions andinsurance services.

*1 Companies listed in the Prime Market of the Tokyo Stock Exchange, selected from Tokio Marine Nichido’s top 150 customers
in terms of written insurance premiums and top 100 customers in terms of GHG emissions

TCFD Report 2024

34

CEO Message
Climate-related Financial Disclosure
Based on the TCFD Recommendations

Governance12Strategies

3

Risk Management

4

Metrics and Targets❹ Plan for the transition to a decarbonized society
Tokio Marine Group has set the target of achieving net-zero emissions by 2050 and formulated a planbusiness partners for the purpose of decarbonization; and insurance underwriting and investment andfor transition encompassing interim targets to define a path toward the ultimate target. The three pillars

financing policies. We will steadily execute our plan while updating it for greater effectiveness in lineof our plan for transition are providing solutions through insurance products and services as well aswith advancements in decarbonization technologies and expectations placed on us by society.

investment and financing that support the transition to decarbonization; dialogue (engagement) withEfforts to dateInsurance
customers andinvestment
and financing
recipients

Providing solutions●2020: Acquired GCube specializing in underwriting insurance for renewable energy business●2023:• Launched a GX Roundtable and started joint development of decarbonization-related products on aGroup basis• Established a company specializing in supporting corporate customers’ decarbonization efforts

Dialogue (engagement)●Provided decarbonization support to insurance customers and investment and financing recipients
through constructive dialogue

Insurance underwriting
and investment andfinancing policies●2020–2021: Restricted new transactions related to coal-fired power generation plants and thermal coalmining projects●2022: Restricted new transactions related to oil and gas company extraction projects in the Arctic
Circle and oil sands mining*1●2 023: Restricted transactions with 60 companies in high-emission sectors if they fail to havedecarbonization plans as of 2030

Direct operations
Corporate citizenship activities●Reduced environmental impact associated with direct operations (introduction of renewable energy,etc.)●Corporate citizenship activities• 1999: Launched mangrove planting• 2007: Mangrove Planting 100-Year Declaration• 2019: Mangrove-based Value Co-creation 100-Year Declaration• 2022: Launched activities to protect and restore eelgrass beds

2030

[2030 target]
Hold dialogue with 200 highemission corporate customers andmake deeper engagements with160 companies among them*1

2050[2050 target]
Achieve carbon neutrality(encompassing insurance
underwriting and investment
and financing portfolio)

Reduce GHG emissions from Tokio
Marine Group by 60% (vs 2015)
Use 100% of renewable electricity
at Tokio Marine Group’s major
business facilities
Switch all company-owned vehicles
to electrified vehicles*2*1 Target of Tokio Marine & Nichido*2 Target of Tokio Marine & Nichido, Tokio Marine & Nichido Life and Nisshin Fire

TCFD Report 2024

35

Risk Management

CEO Message
Climate-related Financial Disclosure
Based on the TCFD Recommendations

1

Governance2

Strategies

Risk Management

34

Metrics and Targets

Risk Management[Managing Climate-Related Risk Based on Enterprise Risk Management (ERM)]

Notional Image of ERM Cycle

Tokio Marine Group conducts enterprise risk management (ERM), which
includes the management of climate risks. Through the ERM cycle, we
comprehensively identify and assess climate-related risks, using both
qualitative and quantitative approaches.
In the underwriting business, which pursues profit through risk-taking, risk
assessment is the foundation of our business. The Group has been working
for many years to increase the level of sophistication of its risk assessment
for material risks (including those due to natural catastrophes) bothquantitatively and qualitatively. Specific initiatives are as follows.
R isk Factors | Financial Data | Tokio Marine Holdings, Inc.

Risk Appetite Framework
Risk Appetite Statement:
Qualitatively describes the policies regardingrisk-taking, including underwriting and investment risk
Quantitative Appetite Standard:
Quantitatively defines a standard for capital adequacy
and profitability

Verification of business plans

Risk Strategy:
Describes the qualitative risk-taking policy by risk
categories such as Japanese Wind & Flood, Japanese
Earth-quake and Investment Credit

Quantitativerisk management

Identification of
emerging risks*1▼▼
Formulation of a capital allocation plan
based on business plans

Monitoring ofrisk amounts

Stress testing▼

Development of business plans
based on risk appetite

Qualitativerisk management

Capital and funding
sufficiency verification

Recognition andassessment ofmaterial risks*2

Measures*3 to addressmaterial risks*1 Emerging risks are new risks that arise due to changes in the environment or other factors, encompassing those that were not traditionally recognized asrisks and those that have increased markedly in severity.
*2 Material risks refer to risks that could have a substantial impact on financial soundness, business continuity and other critical aspects.
*3 For material risks, we formulate response measures (Plan), implement these measures (Do), assess the outcomes (Check) and make improvements (Act).

TCFD Report 2024

37

CEO Message
Climate-related Financial Disclosure
Based on the TCFD Recommendations

1

Governance2

Strategies

3

Risk Management

4

Metrics and Targets◆ Qualitative Risk Management

extensive damages. We update scenarios continuously while taking into account stress tests released by

We identify all forms of risks comprehensively, including those for natural disasters such as large wind/

the regulatory authorities of each country, the latest knowledge (including that of climate change) andflood and emerging risks due to environmental changes. Of these risks, we define risks that will have an

the most recent cases.

extremely large impact on our financial soundness and business continuity as “material risks.” We include
the large wind/flood risks (including climate change physical risks) in the “material risks” category, which[Appropriately Controlling Risk through Risk Diversification and Reinsurance, etc.]

we believe could become more frequent and severe due to the effects of climate change. For these

Natural disasters are inevitable in Japan, our home market. For that reason, we have sought to control

material risks, we also formulate control measures prior to risk emergence and response measures for afterrisk capital by geographic, business and product risk diversification through M&A overseas. In addition,risks occur.

reinsurance, as a hedge against risk, is also an effective way to protect our capital and stabilize profits. The
Group utilizes reinsurance to prepare for major natural disasters (capital events) that occur once every◆ Quantitative Risk Management

few centuries, and we determine earnings coverage from the standpoint of economic rationality and take

For material risks, through measuring risk amounts and implementing stress tests as part of ournecessary measures.

quantitative risk management, we perform a multifaceted review of the adequacy of capital relative to therisks held for the purpose of maintaining ratings and preventing bankruptcy.

[Acquisition of Knowledge (Industry-Academia Collaboration, etc.)]
Tokio Marine Group is deepening collaboration with both inside and outside experts to acquire

We calculate risk amounts posed by natural disasters using a risk model (for Japan, a risk model weknowledge about risks. The Tokio Marine Research Institute collaborates with The University of Tokyo,

developed in-house based on engineering theory and the latest knowledge of natural disasters, andNagoya University and Kyoto University, among others, to carry out impact analysis based on thefor overseas, models provided by outside vendors for insurance companies). We independently analyze

possibility for increased insurance losses associated with natural disasters that are becoming more severechanging trends of past tropical cyclones (typhoons in Japan and hurricanes in the United States) andin nature.

torrential rains and incorporate the up-to-date trends as necessary in order to properly assess current
weather phenomena.

Moreover, Tokio Marine dR and a team of experts in natural disasters working in Atlanta in the UnitedStates are leading efforts to upgrade natural disaster risk management across the entire Group, including

Furthermore, within material risks, we conduct stress tests based on scenarios in which extreme economic

various evaluations of natural disaster risk models.

losses are expected and scenarios where multiple material risks occur at the same time. As for risks
involving major wind and flooding disasters, for example, these scenarios assume typhoons and flooding
on a much larger scale than the major typhoons that hit the Greater Tokyo Area in 2018 and 2019 causing

TCFD Report 2024

38

Metrics and Targets

CEO Message
Climate-related Financial Disclosure
Based on the TCFD Recommendations

1

Governance2

Strategies

3

Risk Management

4

Metrics and Targets

Metrics and Targets❶ Metrics and Targets[Metrics and Targets for Fiscal 2050]◆ Reduction of GHG emissions

Aiming to reduce GHG (CO2) emissions from Tokio Marine Group to net zero by fiscal 2050 for our own*1 Medium-term targets still under consideration*2 Scope 3, Category 15, based on the GHG Protocol standards*3 Associated with our own business activities (Scope 1 [direct emissions] + Scope 2 [indirect emissions] + Scope 3 [otherindirect emissions; Categories 1, 3, 5 and 6] based on the GHG Protocol standards)
Scope 3 includes categories of importance to the Group for which numerical values can be obtained.

operations (including insurance customers and investment and financing recipients)*1,*2.
[Metrics and Targets for Fiscal 2026][Metrics and Targets for Fiscal 2030]◆ Reduction GHG emissions (CO2) from operations of Tokio Marine Group

Reducing GHG emissions (CO2) from Tokio Marine Group’s business activities by 60% (vs 2015)*3◆Increase in insurance products that will contribute to green transformation (GX)Income from insurance premiums increased by around 9 billion yen in three years from fiscal 2021 to
fiscal 2023 (vs fiscal 2020)◆ Renewable electricity use

Using 100% of renewable electricity at Tokio Marine Group’s major business facilities◆E lectrification of company-owned vehiclesO ur strategy is to expand our insurance offerings to drive the more widespread use of renewableenergy. We aim to increase GX-related insurance by using insurance premiums as a metric.

(Tokio Marine & Nichido, Tokio Marine & Nichido Life and Nisshin Fire)Switching all vehicles owned by Tokio Marine & Nichido, Tokio Marine & Nichido Life and Nisshin Fire toelectrified vehicles (EV, PHV, HV, etc.)◆ Improvement of profitability of fire insuranceImproving profitability of fire insurance by around 15 billion yen*4 from fiscal 2024 to fiscal 2026 (Tokio
Marine & Nichido)◆ Engagements with customers (Tokio Marine Nichido)

Profit by fire insurance business amounting to 28.0 billion yen as of the end of fiscal 2023

Tokio Marine & Nichido: Holding dialogue with 200 large corporate customers, which accountfor approximately 90% of its insurance-associated GHG emissions, and making Level 2 or higherT o protect customers and local communities in times of need, we must provide fire insurance inengagements with more than 160 customers among them (See “Engagement with High-Emission

preparation for natural disasters that have been becoming increasingly severe. We will use theCompanies” on page XX); and requesting through engagement 60 companies, which are in high GHG-

profitability of fire insurance as a metric and seek to provide the fire insurance system in a stable andemission sectors out of the 200 large corporate customers, to formulate decarbonization plans andsustainable manner.

declining transactions with those failing to present such plans by 2030

*4 Supposing natural catastrophe claims in an average year

TCFD Report 2024

40

CEO Message
Climate-related Financial Disclosure
Based on the TCFD Recommendations

1

Governance2

Strategies❷ GHG Emissions from Business Operations[Emissions Associated with the Group’s Business Activities and Achieving Carbon Neutrality]
Each Tokio Marine Group company is working to reduce the environmental impact associated with its

3

Risk Management

4

Metrics and Targets*1 Associated with our own business activities (Scope 1 [direct emissions] + Scope 2 [indirect emissions] + Scope 3 [other indirectemissions; Categories 1, 3, 5 and 6] based on the GHG Protocol standards)*2 Amount of paper used, etc. (Categories 1, 3, 5 and 6)*3 Survey contracted out to Mitsubishi Research Institute, Inc. and evaluated following internationally recognized methodologies

business activities, and at the same time, aims to achieve carbon neutrality on a global basis, in which theamount of GHG fixed and reduced through mangrove planting and the use of natural energy exceeds
GHG (CO2) emissions from business activities.
Fiscal 2022●R eduction of GHG (CO2) emissions from Tokio Marine Group operations: 80,201 tons (32% reduction*1vs 2015)(Scope 1: 13,362 tons; Scope 2: 41,190 tons; Scope 3*2: 25,649 tons)●A mount of GHG (CO2) Fixed and Reduced: 93,000 tons

Gas, gasoline
and others
13,362 tons

CO2 emissions
80,201 tons

CO 2 fixation
and reduction
93,000 tons

Scope 1 Direct

Electricity
and others
41,190 tons*

Scope 2
IndirectPaper, business traveland others
25,649 tons

Scope 3Other

Tokio Marine Group is working to reduce the environmental impact (domestic and international)

CO2 absorption andfixation throughmangrove planting
93,000 tons

and become carbon neutral by 1) conserving energy and using energy more efficiently, 2) planting
mangroves to absorb and fix CO2, 3) using renewable energy (such as by procuring green electricity)and 4) amortizing carbon credits. As a result of these efforts, absorption and fixation effects of mangrove
planting and the use of carbon credits in fiscal 2022 outperformed the CO2 emissions generated by theGroup’s overall business activities for the 10th consecutive year (since fiscal 2013).

* CO2 emissions include the effect of purchasing green power, etc., of 14,074 tons.

The value of ecosystem services generated through the Mangrove Planting Project from April 1999
to the end of March 2022 has reached approximately 202.4 billion yen. We expect the value to climb
to 391.2 billion yen by the end of fiscal 2038*3. As of March 31, 2024, we have planted a total area of
12,567 hectares of mangrove forest.

TCFD Report 2024

41

CEO Message
Climate-related Financial Disclosure
Based on the TCFD Recommendations

Governance12Strategies❸ GHG Emissions for Investment Portfolio

3

Risk Management

4

Metrics and Targets

WACI (tCO2e/million USD)

To assess the climate change-related risks and opportunities of its investee companies and financing
recipients, Tokio Marine & Nichido has performed analysis of total GHG emissions and weighted average

Fiscal 2020

Fiscal 2021

Fiscal 2022

Domestic equities

111

114

107

Domestic bonds

545

542

453

carbon intensity (WACI) on its domestic listed equity and bond portfolios as of March 31, 2023, thedisclosure of which is recommended by the TCFD. In performing the analysis, the company conductedmeasurements using data provided by MSCI ESG Research LLC*1, 2, 3.
We will continue to urge our investee companies to fully disclose climate change-related information andwork toward a decarbonized society through engagement, while also making use of this analysis.
Total GHG Emissions (Scopes 1 & 2; million tCO2e)
Domestic equities

Domestic bonds

3.5
3.0
2.5

2.91

2.79

2.70

1.13

0.92

0.84

1.78

1.86

1.86

Fiscal
2020

Fiscal2021

Fiscal
2022

2.0
1.5
1.0
0.5

Total GHG emissions:GHG emissions associated with the portfolio, calculated based on the company’s percentage of equity ownership to adjusted
corporate value (market capitalization + interest-bearing debt)
Weighted average carbon intensity (WACI):Calculated by multiplying each investee company’s greenhouse gas emissions to revenue by the weight of the company in theportfolio and getting the sum of these figures*1 The figures in the table cover 93.3% of the domestic listed equities in the portfolio (based on the market value). Likewise, thefigures in the table cover 66.0% of the domestic bonds in the portfolio (based on the book value).
*2 Data may be subject to change retrospectively.
*3 We conducted measurement of our GHG emissions using information (the “Information”) from MSCI ESG Research LLC and
its affiliates (the “ESG Parties”) as well as from other information providers. The Information may only be used for readers’internal use, may not be reproduced or resold in any form and may not be used as a basis for, or a component of, any financial
instruments or products or indices. The ESG Parties do not allow the use of the Information to determine which securities
to buy or sell or when to buy or sell them and do not warrant or guarantee the originality, accuracy and/or completeness of
the Information. The ESG Parties expressly disclaim all explicit or implicit warranties, including those of merchantability andfitness for a particular purpose. None of the ESG Parties shall have any liability for any errors or omissions in connection with
the Information or any liability for any direct, indirect, special, punitive, consequential or any other damages (including lost
profits) even if they have been notified of the possibility of such damages.

0

TCFD Report 202442