[English Translation]
TOKIO MARINE HOLDINGS, INC.

Attachment to the "Notice of Convocation of
the 7th Ordinary General Meeting of Shareholders"Business Report for the Fiscal Year Ended March 31, 2009
(From April 1, 2008 to March 31, 2009)
1. Matters Concerning the Insurance Holding Company(1) Business Developments and Results
During the fiscal year ended March 31, 2009, the Japanese economy showed more serious
signs of deterioration as turbulence in the financial markets triggered a global recession and a
decline in exports and sluggish consumer spending caused corporate earnings to decreasesignificantly.
In the insurance industry, property and casualty insurance premiums decreased primarily
because of lower automobile sales volume, rate cut in compulsory automobile liability
insurance and decreased goods flow. In the life insurance sector, the amount of newly signed
insurance policies decreased due in part to the declining birthrate and aging population.
In this environment, the Tokio Marine Group (the “Group”) has striven to be a “global
corporate group offering quality that customers select”. While reflecting upon previous errors
found in connection with insurance underwritings and claim payments, the Group has
thoroughly carried out initiatives that ensure proper operations and improve quality of businessin accordance with its three-year “Stage Expansion 2008” business plan which ended in thefiscal year ended March 31, 2009.
Despite this effort, Tokio Marine Holdings, Inc. (“Tokio Marine Holdings” or the“Company” or “We”) reported a significant underachievement of its consolidated businessresults. As described below, this was mainly due to impairment losses on securities resulting
from turbulence in the financial markets and declines in stock markets.
On a consolidated basis, ordinary income amounted to 3,503.1 billion yen, a decrease of
206.9 billion yen from the previous fiscal year. The main components of ordinary income1were underwriting income of 3,130.0 billion yen and investment income of 306.6 billion yen.
Ordinary profit decreased by 194.1 billion yen to -15.1 billion yen. Net income was 23.1
billion yen for the fiscal year ended March 31, 2009, a decrease of 85.6 billion yen from theprevious fiscal year.
Tokio Marine Holdings
On a non-consolidated basis, Tokio Marine Holdings, the holding company for the Group,
received business management fees amounting to 6.5 billion yen and dividends totaling 130.0
billion yen from its subsidiaries and affiliates, resulting in operating income of 136.5 billion
yen, ordinary profit of 130.4 billion yen, and net income of 117.1 billion yen.
The Company seeks to enhance the management of subsidiaries by optimizing theallocation of management resources and strengthening risk management and compliancethroughout the Group.
In addition, the Company changed its corporate name to Tokio Marine Holdings, Inc. in
July 2008 and has been pushing forward with the Group growth strategies on a global basis
under the brand name of “Tokio Marine,” which we believe to have wide recognition at home
and abroad, aimed at increasing overall corporate value.
Property and Casualty Insurance BusinessIn the property and casualty insurance business, premiums written decreased in a difficult
business environment. Profitability of investments also fell significantly due to turbulent
market conditions caused by aggravation of the financial crisis and worsening of the real
economy.
The following represents the operating results of Tokio Marine & Nichido Fire InsuranceCo., Ltd. (“Tokio Marine & Nichido”) for the fiscal year ended March 31, 2009. Net
premiums written were 1,813.4 billion yen, a year-on-year decrease of 5.2 percent. Ordinary
profit was 69.6 billion yen, a decrease of 114.3 billion yen, and net income was 71.1 billion
yen, a decrease of 51.8 billion yen from the previous fiscal year.
With respect to the operating results of Nisshin Fire & Marine Insurance Co., Ltd.
(“Nisshin Fire”) for the fiscal year ended March 31, 2009, net premiums written were 135.9

2billion yen, representing a decrease of 4.1 percent from the previous fiscal year. Ordinary
profit was -16.1 billion yen, a decrease of 18.8 billion yen, and net income was -10.3 billion
yen, a decrease of 12.2 billion yen.
Major initiatives introduced in the property and casualty insurance business in the fiscal
year ended March 31, 2009 were as follows.
Tokio Marine & Nichido aims to maintain growth by offering quality that customers selectby ensuring its competitiveness through the improvement of the quality of products andservices, the enhancement of customer contacts in the course of insurance solicitation to claim
payments and the realization of customer-friendly business processes as a whole.
Tokio Marine & Nichido focused on a new business renovation project named “Drastic
Reform of Business Processes” and an establishment of “Multi-access.” The purpose of the
new business renovation project is to provide high-quality services and enhance businessefficiency and customer-friendliness by streamlining insurance products, restructuring thesystem infrastructure and renovating business processes. As the first step of this project, Tokio
Marine & Nichido substantially simplified auto insurance, the core product of Tokio Marine &Nichido, and transferred the administration of auto insurance policies to a new systeminfrastructure. Additionally, Tokio Marine & Nichido reconfigured its agency system in May
2008. In order to enhance its customer contacts in full cooperation with agents, Tokio Marine& Nichido is engaged in an establishment of a fundamental infrastructure called“Multi-access” that utilizes call centers and websites for insurance solicitation.
Furthermore, to improve the service quality of agents offered to customers, Tokio Marine& Nichido promoted the use of TNet, a new agency system, and reinforced support to its
agents by utilizing “Agent Compass”, which helps agents assess their managerial issues to besolved. Tokio Marine & Nichido also supported its agents to improve the quality of their risk
consulting services by an alliance with Secom Co., Ltd. where Tokio Marine & Nichido andSecom Co. Ltd. developed an original home security system exclusively for customers of
Tokio Marine & Nichido. The home security system is offered as part of the service menu of
Tokio Marine & Nichido agents’ risk consulting service that provides its customers with apreventative measure to ensure safety and security in combination with insurance, which
ensure an assurance for post-accidents.
Nisshin Fire also continues to focus on improving its insurance underwriting and claim

3payments to enhance business quality in the same manner as Tokio Marine & Nichido.
In January 2009, the Company entered into a business and capital alliance agreement withNTT FINANCE CORPORATION, a subsidiary of NIPPON TELEGRAPH ANDTELOPHONE CORPORATION, and established “E. design Insurance Preparatory Co., Ltd.”
Upon approval by regulatory authorities, this company is expected to be transformed into a
property and casualty insurance company, which will focus on sales of automobile insurance
using mobile networks, including cellular phones, and the Internet.
Life Insurance BusinessWith regard to the life insurance business, sales of whole-life insurance and cancer
insurance remained robust. However, sales of variable annuity insurance declined mainly
due to diminished risk tolerance for investments caused by turbulence in the financial
markets.
As of March 31, 2009, Tokio Marine & Nichido Life Insurance Co., Ltd. (“Tokio
Marine & Nichido Life”) recorded 19,074.5 billion yen in the amount of life
insurance-in-force, an increase of 1,076.7 billion yen from March 31, 2008, while theamount of newly signed life insurance was 2,506.1 billion yen, a year-on-year increase of
15.8 percent. Ordinary profit amounted to 5.5 billion yen, a decrease of 0.4 billion yen
from the previous fiscal year. Tokio Marine & Nichido Life continued to set aside
additional amounts into underwriting reserve, seeking to meet the standard underwriting
reserve required under the Insurance Business Law of Japan. As a result, net income
amounted to 0 billion yen.
As of March 31, 2009, Tokio Marine & Nichido Financial Life Insurance Co., Ltd. (“Tokio
Marine & Nichido Financial Life”) recorded 2,642.2 billion yen in the amount of life
insurance-in-force, an increase of 306.3 billion yen from March 31, 2008, although theamount of newly signed life insurance decreased 12.8 percent from a year earlier to 443.0
billion yen. Ordinary profit and net income amounted to 10.0 billion yen, an increase of 16.5
billion yen from the previous fiscal year, respectively.
Major initiatives introduced in the life insurance business in the fiscal year ended March 31,
2009 were as follows.

4

Tokio Marine & Nichido Life has been advancing the “Second Inauguration Project,”centering on (1) reinforcement of sales channels in response to the change in businessenvironment, (2) renovation of business processes and (3) increased promotion campaigns togain wider recognition. It has also sought to provide improved customer support through a
program called "Cancer Prevention Campaign" offering medical checkups to customers todetect cancer at early stages.
Tokio Marine & Nichido Financial Life strengthened alliances with financial institutions on
over-the-counter sales of variable annuity insurance and has sought to ensure sound business
management by utilizing reinsurance to enhance its risk management framework.
Overseas Insurance Business
Major initiatives taken in the overseas insurance business in the fiscal year ended March 31,
2009 were as follows:
The Company acquired Philadelphia Consolidated Holding Corp. (“PHLY”), a U.S.
property and casualty insurance group, and made it a subsidiary of Tokio Marine & Nichido in
December 2008. For the fiscal year ended December 31, 2008, PHLY achieved steady revenue
growth and recorded 145.1 billion yen in net earned premiums, an increase of 15.3 percent
from the previous fiscal year. Through this acquisition, the Tokio Marine Group has expanded
the scale and earnings of its overseas insurance business and established a solid foundation tooperate an extensive insurance business in the U.S., the largest property and casualty
insurance market in the world.
In December 2008, the Company established through Tokio Marine & Nichido a syndicatethat assumes a principal role in insurance underwriting in the Lloyd’s insurance market in the
U.K. We will strive to further develop our insurance business in Lloyd’s through thissyndicate in close cooperation with the Kiln Group, a U.K. insurance group the Company
acquired in March 2008.
Upon receiving an approval from the Chinese insurance authorities in November 2008,
Tokio Marine & Nichido established a Chinese insurance subsidiary by reorganizing its
Shanghai Branch. The subsidiary plans to set up branches and expand its insurance business in
China.

5

In March 2009, for 26.6 billion yen, the Company sold to Banco Santander S.A. all its
shares of a life insurance and pension affiliate in Brazil that were held through its Brazilian
property and casualty insurance subsidiary.
Asset Management, Financial services business and Other Businesses
During the fiscal year ended March 31, 2009, Tokio Marine & Nichido closely evaluatedindividual investment cases in its managed assets and carefully carried out risk management
to maintain a sound financial base. In addition, in order to meet payment obligations such as
insurance claims and maturity refunds, Tokio Marine & Nichido continued its efforts tostrengthen its asset liability management and ensure the financial security and liquidity of its
assets.
However, in the fiscal year ended March 31, 2009, the Tokio Marine Group recorded large
losses due to turbulence in the financial markets and the decline in stock markets.
Specifically, the Company's subsidiaries recorded impairment losses on securities of 98.8
billion yen, the major components of which were impairment losses on domestic stocks of
37.0 billion yen and impairment losses on foreign securities, including fund-related
investments, of 53.3 billion yen. Impairment losses on securities recorded in the Company’s
consolidated financial statements were 162.2 billion yen, which includes an adjustment
amount of 63.3 billion yen, recorded only for consolidation accounting purposes inaccordance with the purchase method of accounting adopted for past business combinations.
Besides these impairment losses on securities, impairment losses relating to credit default
swaps (CDS) and asset-backed securities (ABS) amounted to 14.2 billion yen and 38.4 billion
yen, respectively.
The Company expanded its financial services business, centered on the asset managementbusiness. As for other businesses, the Company mainly engaged in risk consulting, elderly
care and health related businesses. While all these businesses faced a difficult businessenvironment amid the global financial crisis and recession in the fiscal year ended March 31,
2009, all group companies will seek to further strengthen their risk management measures.
Initiatives for Prevention of Global Warming

6

In November 2008, Tokio Marine & Nichido became the first financial institution in Japan
to be verified by a certified third-party institution as “carbon neutral”. Tokio Marine &Nichido’s carbon emission levels from its entire domestic operations were completely offset
by its absorption/reduction effect. This reflects Tokio Marine & Nichido’s efforts to reducecarbon dioxide emission from its operations, its purchase of green electricity, a mangroveafforestation project and its purchase/amortization of emission rights.
Issues Facing the Tokio Marine GroupIn the fiscal year ending March 31, 2010, the Japanese economy is expected to facecontinued weak domestic and foreign demand amid the global recession.
Given current economic conditions coupled with a declining birthrate and aging population,
the domestic insurance market is not expected to grow and it remains an essential task forinsurance companies to ensure profits.
Beginning with the fiscal year ending March 31, 2010, the Company has been implementing
a new three-year corporate strategy “Innovation and Execution 2011,” with a vision of
becoming a “global corporate group maintaining growth by offering quality that customers
select.” In accordance with the strategy, we aim to realize sustainable earnings growth thatdeparts from the improvement of quality of products, services and business processes. We will
also focus on the establishment of an optimal business portfolio by allocating management
resources in business areas with high profitability and growth potentials. Furthermore, inorder to strengthen our business management and administration system on a global basis, wewill enhance our risk management structure, including the establishment of infrastructurenecessary for our risk-based management (through an ERM system), and cope with the global
standardization of accounting principles and risk management standards.
Under its management philosophy to place “customer trust at the base of all its activities,”
the entire Tokio Marine Group will endeavor to achieve further growth as a corporate group,
seeking growth characterized by high profitability, sustainability and soundness. The
management would like to express its sincere appreciation to all shareholders of Tokio Marine
Holdings for their continued guidance and support.
Note 1: Throughout this Business Report, all amounts (including numbers of shares) are truncated andall ratios are rounded.

7

Note 2: The yen-denominated amounts of net earned premiums of PHLY are calculated at the exchange
rate as of the end of December 2008. The business results of PHLY are not included in the
consolidated statement of income of the Company for the fiscal year ended March 31, 2009,
since PHLY became a consolidated subsidiary of Tokio Marine Holdings in December 2008.
Note 3: The yen-denominated amount of sales price of shares of a life insurance and pension affiliate in
Brazil is calculated at the exchange rate as of the end of December 2008.
Note 4: The Company’s consolidated financial statements have recorded the securities held by theacquired companies, including The Nichido Fire and Marine Insurance Company, Limited, apredecessor company of Tokio Marine & Nichido, and Nisshin Fire at the fair value as of therespective dates of acquisition in accordance with the purchase method of accounting.
Consequently, the book value of the relevant securities on the Company's consolidated financial
statements is greater than those on the two subsidiaries’ individual financial statements, and so
are the impairment losses on the relevant securities.

8(2) Four Year Summary of Assets and Earnings
a. Non-consolidated summary of assets and earnings(Yen in millions, except per share amounts)(Fiscal years ended March 31)
2006
2007
2008
2009
Operating income
143,103297,763
74,702
136,570
Dividends received
140,473
293,928
69,400130,053
Insurance subsidiaries
140,400
293,072
69,202
129,134
Other subsidiaries
73
855
197
919
Net income
138,457
292,838
70,385
117,197
Net income per share of common
81,541.70
352.92
86.41
147.53
stock
yen
yen
yen
yen
Total assets
2,366,696
2,557,287
2,505,334
2,530,333
Stock of insurance subsidiaries
2,245,189
2,403,796
2,426,412
2,427,769
Stock of other subsidiaries
47,57949,05553,17868,246
Note: Effective September 30, 2006, the Company conducted a stock split of its shares of common
stock whereby one share was split into 500 shares. Assuming that the stock split had been
conducted at the beginning of the fiscal year ended March 31, 2006, net income per share ofcommon stock would have been 163.08 yen for the fiscal year ended March 31, 2006.

b. Consolidated summary of assets and earnings

2006
3,399,984
136,563
89,9603,209,849
14,260,020

Ordinary income
Ordinary profit
Net income
Net assets
Total assets(Yen in millions)(Fiscal years ended March 31)
2007
2008
2009
4,218,557
3,710,066
3,503,102
168,042
179,071-15,128
93,014
108,766
23,1413,410,707
2,579,339
1,639,514
17,226,952
17,283,242
15,247,223

Note: In calculating net assets, the Company has adopted the "Accounting Standard for Presentation of
Net Assets in the Balance Sheet" (Accounting Standards Board of Japan, hereinafter the "ASBJ",
Statement No. 5) and "Guidance on Accounting Standard for Presentation of Net Assets in the
Balance Sheet" (ASBJ Guidance No. 8) from the fiscal year ended March 31, 2007.

(3) Offices (As of March 31, 2009)
Head Office

Location
2-1, Marunouchi 1-chome, Chiyoda-ku, Tokyo, Japan

Established as ofApril 2, 2002

Note: The date shown above is the date of incorporation.

(4) Employees
a. Number of employees (on a non-consolidated basis)
As of March 31, 2008 As of March 31, 2009
Total

382

370

Increase(decrease)-12

Average age of employees (As of March 31, 2009): 41.3 years old
Average length of service of employees (As of March 31, 2009): 18.1 years
Average monthly salary of employees (As of March 31, 2009): 758 thousand yen per
employee9Notes: 1. Average length of service includes the years of service at each of the subsidiaries from which
the employees are seconded.
2. "Average monthly salary" is the average ordinary monthly salary in March 2009 and includes
overtime and holiday allowances but does not include bonuses.
3. As for average age and average length of service of employees, numbers smaller than 0.1 arerounded down.

b. Number of employees (on a consolidated basis)
As of March 31,
Name of division
2008
Property and casualty
21,248insurance
Life insurance
2,550
Others
1,161
Total
24,959As of March 31,
2009
23,530

Increase(decrease)
2,282

2,771
1,762
28,063

221
601
3,104

Note: The number of employees as of March 31, 2009 has increased from that as of March 31, 2008
mainly due to the consolidation of Philadelphia Consolidated Holding Corp.

(5) Principal Lenders (As of March 31, 2009)a. Principal lenders of the Company
None.
b. Principal lenders of consolidated subsidiaries
Lender(s)Balance of loan (million yen)
Syndicated loan
250,000(Note) The arranger of the syndicated loan is The Bank of Tokyo-Mitsubishi UFJ, Ltd.
(6) Financing Activities
a. Financing activities of the Company
None.
b. Financing activities of consolidated subsidiaries
In order to finance the acquisition of Philadelphia Consolidated Holding Corp., Tokio
Marine & Nichido raised 250,000 million yen through a syndicated loan arranged by The
Bank of Tokyo-Mitsubishi UFJ, Ltd.
(7) Capital Investment Activities
a. Total investment in facilities
98 million yen.
b. New construction of major facilities
None.
(8) Parent Company and Major Subsidiaries (As of March 31, 2009)10

a. Parent company
None.
b. Major subsidiaries and affiliates accounted for by the equity method
Ratio ofCompany namePaid-in Tokio
Date ofcapital Marine
Notes
incorporation (Yen in Holdings'
millions) voting

Location

Major business

Tokio Marine & Nichido
Fire Insurance Co., Ltd.

Tokyo,Japan

Property andMar. 20, 1944
casualty insurance

101,994 100.0%-

Nisshin Fire & Marine
Insurance Co., Ltd.

Tokyo,Japan

Property andcasualty insurance

June 10, 1908

20,389 100.0%-

Tokio Marine & Nichido

Tokyo,Japan

Life insurance

Aug. 6, 1996

55,000 100.0%-

Tokio Marine & Nichido
Financial Life InsuranceCo., Ltd.

Tokyo,Japan

Life insurance

Aug. 13, 1996

48,000 100.0%-

Millea Nihon Kosei SS
Insurance Co., Ltd.

Kanagawa,
Japan

Small-amountshort-term
insurance

Sep. 1, 2003

1,595

89.5%

-

Philadelphia Consolidated
Holding Corp.

Bala

Holding company

July 6, 1981

0 100.0%(100.0)-Property andFeb. 4, 1927
casualty insurance

353 100.0%(100.0)-17,556 100.0%(100.0)-rightsLife Insurance Co., Ltd.

Cynwyd,Pennsylvania,
U.S.

Philadelphia Indemnity
Insurance Company

Bala
Cynwyd,Pennsylvania,
U.S.

Tokio Marine Global Ltd.

London,U.K.

Property andOct. 30, 1990
casualty insurance

Kiln Group Limited

London,U.K.

Holding company

July 11, 1994

140 100.0%(100.0)-Kiln Underwriting Limited

London,U.K.

Property andJune 13, 1994
casualty insurance

0 100.0%(100.0)-

Tokio Marine Bluebell Re
LimitedDouglas,Isle of Man

Life insurance

Mar. 8, 2007

14,000 100.0%-

Holding company

Mar. 12, 1992

37,816 100.0%-

Tokio Marine Asia Pte. Ltd. Singapore,
Singapore11

Company nameLocation

Major business

Ratio of
Tokio
Date ofcapitalMarineNotes
incorporation (Yen in Holdings'
votingmillions)rightsAsia General Holdings
LimitedSingapore,
Singapore

Holding company

Feb. 24, 1971

4,849

92.4%
(92.4)-

Tokio Marine Insurance
Singapore Ltd.

Singapore,
Singapore

Property andcasualty insurance

July 11, 1923

6,466 100.0%(100.0)-

TM Asia Life Singapore
Ltd.

Singapore,
SingaporeLife insurance

May 21, 1948

2,327

85.2%
(85.2)-TM Asia Life Malaysia
Bhd.

Kuala
Lumpur,MalaysiaLife insurance

Feb. 11, 1998

2,693 100.0%(100.0)-Sino Life Insurance Co.,Ltd.

Shenzhen,
China

Life insurance

Mar. 4, 2002

19,52224.9%(24.9)-

Tokio Marine Seguradora
S.A.

Sao Paulo,
BrazilProperty andcasualty insurance

June 23, 1937

10,234 100.0%-

Tokio Millennium Re Ltd.

Hamilton,
BermudaProperty andcasualty insurance

Mar. 15, 2000

24,557 100.0%(100.0)-

Tokio Marine Financial
Solutions Ltd.

Georgetown Derivatives
business
CaymanIslands

Dec. 4, 1997

1,178 100.0%(100.0)-Paid-in

1. This table sets forth important subsidiaries and affiliates accounted for by the equity method.
2. Philadelphia Consolidated Holding Corp. and Philadelphia Indemnity Insurance Company areincluded in the table as they became subsidiaries of the Company as of December 1, 2008.
3. Kiln (UK) Holdings Limited was renamed Kiln Group Limited as of January 19, 2009.
4. Kiln Ltd and Kiln Reinsurance Ltd are excluded from the table because these companies havebeen dissolved.
5. Tokio Marine Europe Insurance Limited was excluded from the table due to a change in thecriteria used to determine the important subsidiaries and affiliates.
6. TM Asia Insurance Singapore Ltd. was renamed Tokio Marine Insurance Singapore Ltd. asof July 1, 2008.
7. Tianan Insurance Company Limited and Real Tokio Marine Vida e Previdência S.A. were
excluded from the table because they are no longer affiliates accounted for by the equity
method of the Company.
8. Real Seguros S.A. was renamed Tokio Marine Seguradora S.A. as of August 20, 2008.
9. Vetra Finance Corporation was excluded from the table because it is no longer a consolidated
subsidiary of the Company.

1210. The yen amounts of paid-in capital of subsidiaries and affiliates located outside Japan havebeen translated at the currency exchange rate as of the closing date of the fiscal year of theCompany.
11. Figures in brackets shown under Tokio Marine Holdings' voting rights reflect Tokio Marine
Holdings' indirectly held ownership ratio in the respective subsidiary.
12. The date of incorporation of Tokio Marine Seguradora S.A. was incorrectly listed in theequivalent to this table in the business reports for the fiscal years ended March 31, 2006,
2007 and 2008. The correct date of incorporation is June 23, 1937, as set forth above.

(9) Acquisition and transfer of businessa. Acquisition and transfer of business by the Company
Date of theOutline of the transactionstransactions
January 26, 2009
The Company and NTT FINANCE CORPORATION, a subsidiary of
NIPPON TELEGRAPH AND TELEPHONE CORPORATION, jointly
established E. design Insurance Preparatory Co., Ltd. (the "Preparatory
Company"), which is expected to be transformed into a new property andcasualty insurance company. The Company invested 5,950 million yen in
the Preparatory Company and acquired 85.0% of its shares. Details of the
Preparatory Company are as follows.
- Preparatory Company:
Company name: E. design Insurance Preparatory Co., Ltd.
Head office: Shinjuku-ku, Tokyo
Business lines: Application to obtain a property and casualty insurance
business license under the Insurance Business Law of Japan- Purpose of the establishment
Upon regulatory approval, the Company intends to transform the Preparatory
Company into a new property and casualty insurance company, which will
focus on sales of automobile insurance using mobile networks, including
cellular phones, and the Internet.

b. Acquisition and transfer of business by consolidated subsidiaries
Date of theOutline of the transactionstransactions
December 1, 2008
On July 23, 2008, Tokio Marine & Nichido entered into a definitive
agreement with Philadelphia Consolidated Holding Corp. ("PHLY"), aproperty and casualty insurance group in the U.S., to acquire 100% of theoutstanding shares of PHLY. Subsequently, upon obtaining approvals at
PHLY's extraordinary shareholders meeting and from regulatory authorities
in relevant countries, Tokio Marine & Nichido completed the PHLY
acquisition as of December 1, 2008. The acquisition cost was 473,537
million yen. Details of PHLY and the purpose of the acquisition are as
follows.
- Company acquired:Company name: Philadelphia Consolidated Holding Corp.
Head office: Bala Cynwyd, Pennsylvania, U.S.
Business lines: Holding company for subsidiaries operating insurance
and insurance-related businesses- Purpose of the acquisition
To expand the scale and earnings of the Company's overseas insurance
business and establish a solid foundation to operate an extensive insurance
business in the U.S., the largest property and casualty insurance market in
the world.
13

March 19, 2009

On March 19, 2009, Tokio Marine Seguradoara S.A., a Brazilian property
and casualty insurance subsidiary of the Company, sold all of its shares ofReal Tokio Marine Vida e Previdência S.A., a Brazilian life insurance andpension affiliate, to Banco Santander S.A., for 26,669 million yen.

(10) Other Important Matters Concerning the Current State of the Holding Company
None.
2. Matters Concerning Directors and Corporate Auditors(1) Directors and corporate auditors (As of March 31, 2009)
Name
Kunio Ishihara

Position and assigned
dutiesDirector and Chairman of
the Board

Shuzo Sumi

Representative Director
and President

Toshiro Yagi

Representative Directorand Executive Vice
President

Other major occupations and other matters
Chairman of the Board of Tokio Marine & Nichido
Director of The Bank of Tokyo-Mitsubishi UFJ, Ltd.
(outside director)
Director of Japan Airlines Corporation (outside
director)
Director of Japan Airlines International Co., Ltd.
(outside director)
Representative Director and President of Tokio
Marine & Nichido

In charge of Corporate
Planning Dept. (excludingInternal Control Group),
Personnel Planning Dept.,
Legal Dept. and assistantto the Director in chargeof Compliance Dept.,
Risk Management Dept.
and Internal Audit Dept.
Daisaku Honda

Representative Director
and Senior Managing
Director

Director of Matsuya Co., Ltd. (outside director)

In charge of Corporate
Planning Dept. (Internal
Control Group), Corporate
Accounting Dept.,
Business Development andSupport Dept.,
Compliance Dept., Risk
Management Dept. andInternal Audit Dept.

14

Hiroshi Amemiya

Senior Managing Director

Senior Managing Director of Tokio Marine &NichidoIn charge of Financial
Planning Dept.
Shin-Ichiro Okada

Managing Director

Managing Director of Tokio Marine & Nichido

Overall supervision ofoverseas insurance
business; In charge ofInternational Business
Development Dept.
(management of European
and Middle Easternregions and reinsurance
operations)
Hiroshi EndoManaging Director
In charge of International
Business Development
Dept. (management ofAmericas, Asian andOceanian regions)

Minoru Makihara

Director(outside director)

Senior Corporate Advisor of Mitsubishi Corporation
Director of Shinsei Bank, Limited (outside director)
Director of Mitsubishi UFJ Securities Co., Ltd.
(outside director)
Director of Mitsubishi Logistics Corporation(outside director)

Masamitsu Sakurai

Director(outside director)

Representative Director and Chairman of the Boardof Ricoh Company, Ltd.
Director of OMRON Corporation (outside director)
Director of Coca-Cola West Co., Ltd.
Chairman of Japan Association of Corporate
Executives

Haruo Shimada

Director(outside director)

Dean of Chiba University of Commerce
Director of Funai Zaisan Consultants Co., Ltd.
(outside director)
Corporate Auditor of OKAYA & CO., LTD. (outside
corporate auditor)
Corporate Auditor of Temp Holdings Co., Ltd.
(outside corporate auditor)

Tomochika Iwashita

Director

President of Tokio Marine & Nichido Life

Hiroshi Miyajima

Director

President of Nisshin Fire

Tsuyoshi Nagano

Director

Managing Director of Tokio Marine & Nichido

Yasuo Yaoita

Standing Corporate
Auditor15

Tetsuo Kamioka

Standing Corporate
AuditorMr. Kamioka, as a director of Tokio Marine &Nichido Life, was in charge of accounting
department and has expertise in finance andaccounting.

Shigemitsu Miki

Corporate Auditor(outside corporate auditor)

Senior Advisor of The Bank of Tokyo-Mitsubishi
UFJ, Ltd.
Director of Mitsubishi Electric Corporation (outside
director)
Corporate Auditor of Mitsubishi Motors Corporation(outside corporate auditor)
Corporate Auditor of Nippon Steel Corporation(outside corporate auditor)

Hiroshi Fukuda

Corporate Auditor(outside corporate auditor)

Attorney-at-law

Yuko Kawamoto

Corporate Auditor(outside corporate auditor)

Professor, Waseda Graduate School of Finance,
Accounting and Law
Director of Resona Holdings, Inc. (outside director)
Director of Yamaha Motor Co., Ltd. (outside
director)
Director of Monex Group, Inc. (outside director)
Director of Osaka Securities Exchange Co., Ltd.
(outside director)

Notes:

Outside directors and outside corporate auditors qualify as those defined by Article 2,paragraph 3, item 5 of the Enforcement Regulations of the Companies Act of Japan.

(2) Remuneration and Other Compensation to Directors and Corporate Auditors

Directors

Number of persons to receive
remuneration and other compensation
15 persons

Remuneration and other compensation
306 million yen

Corporate
Auditors

5 persons95 million yen

Total

20 persons

401 million yen

Note 1: "Number of persons to receive remuneration and other compensation" includes two directors
who retired from office at the close of the 6th ordinary general meeting of shareholders heldon June 23, 2008.
Note 2: "Remuneration and other compensation" includes the amounts paid to the two directors
referred to in “Note 1” above.
Note 3: Remuneration in connection with stock acquisition rights is described below.
Directors:
48 million yen
Corporate Auditors: 14 million yen
Total:
62 million yen
Note 4: Maximum amount of remuneration as determined by the resolution of the general meeting ofshareholders is described below.

Directors

Maximum amount of remuneration as determined by
the resolution of the general meeting of shareholders
Monthly remuneration: 25 million yen per month

Remuneration in connection with stock acquisitionrights: 70 million yen per year
16

Corporate
Auditors

Monthly remuneration: 10 million yen per month
Remuneration in connection with stock acquisitionrights: 30 million yen per year
Monthly remuneration: 35 million yen per month

Total

Remuneration in connection with stock acquisitionrights: 100 million yen per year

3. Matters Concerning Outside Directors and Outside Corporate Auditors(1) Other Assignments (As of March 31, 2009)
Name

Other assignments

Minoru Makihara(outside director)

Director of Shinsei Bank, Limited (outside director)
Director of Mitsubishi UFJ Securities Co., Ltd. (outside director)
Director of Mitsubishi Logistics Corporation (outside director)

Masamitsu Sakurai(outside director)

Representative Director and Chairman of the Board of Ricoh Company, Ltd.
(corporate officer)
Director of OMRON Corporation (outside director)

Haruo Shimada(outside director)

Director of Funai Zaisan Consultants Co., Ltd. (outside director)
Corporate Auditor of OKAYA & CO., LTD. (outside corporate auditor)
Corporate Auditor of Temp Holdings Co., Ltd. (outside corporate auditor)

Shigemitsu Miki(outside corporate
auditor)Director of Mitsubishi Electric Corporation (outside director)
Corporate Auditor of Mitsubishi Motors Corporation (outside corporate auditor)
Corporate Auditor of Nippon Steel Corporation (outside corporate auditor)

Yuko Kawamoto(outside corporate
auditor)Director of Resona Holdings, Inc. (outside director)
Director of Yamaha Motor Co., Ltd. (outside director)
Director of Monex Group, Inc. (outside director)
Director of Osaka Securities Exchange Co., Ltd. (outside director)

Notes: 1. Outside directors and outside corporate auditors qualify as those defined by Article 2,paragraph 3, item 5 of the Enforcement Regulations of the Companies Act of Japan.
2. Ricoh Company, Ltd. purchases insurance from insurance subsidiaries of the Company, andhas business relating to office automation equipment with the Company and its subsidiaries.
3. Mr. Masamitsu Sakurai is a director of Coca-Cola West Co., Ltd. He is neither its corporate
officer nor its outside director.

(2) Principal Activities
Name
Minoru Makihara(outside director)

Current term
in office7 years

Attendance of board
meetings etc.

Major activities including theremarks made at board meetings etc.

Attended 13 of the 16 boardof directors' meetings held
during the fiscal year ended
March 31, 2009.

He has fulfilled his supervisory
functions by asking for detailed
explanations and making remarks ona timely basis, based on his insight asa company manager which has beenacquired through many years ofexperience in a management role.

17

Masamitsu Sakurai

7 years

Attended 9 of the 16 boardof directors' meetings held
during the fiscal year ended
March 31, 2009.

He has fulfilled his supervisory
functions by asking for detailed
explanations and making remarks ona timely basis, based on his insight asa company manager which has beenacquired through many years ofexperience in a management role.

7 years

Attended 11 of the 16 boardof directors' meetings held
during the fiscal year ended
March 31, 2009.

He has fulfilled his supervisory
functions by asking for detailed
explanations and making remarks ona timely basis, based on his insight asa specialist in economics which has
been acquired through many years of
involvement in academic activities.

7 years

Attended 10 of the 16 boardof directors' meetings, and 8of the 11 board of corporate
auditors' meetings held
during the fiscal year ended
March 31, 2009.

He has fulfilled his audit functions
by asking for detailed explanations
and making remarks on a timely
basis, based on his insight as acompany manager which has beenacquired through many years ofexperience in a management role.

2 year and 9 Attended all 16 board ofmonthsdirectors' meetings, and all
11 board of corporate
auditors' meetings held
during the fiscal year ended
March 31, 2009.

He has fulfilled his audit functions
by asking for detailed explanations
and making remarks on a timely
basis, based on his insight acquired
through many years of experience asa diplomat and as a Justice of theSupreme Court of Japan.

2 year and 9 Attended 15 of the 16 board
monthsof directors' meetings, and
10 of the 11 board ofcorporate auditors' meetings
held during the fiscal year
ended March 31, 2009.

She has fulfilled her audit functions
by asking for detailed explanations
and making remarks on a timely
basis, based on her insight onbusiness management which has
been acquired through many years ofexperience as a consultant andinvolvement in academic activities.

(outside director)

Haruo Shimada(outside director)

Shigemitsu Miki(outside corporate
auditor)Hiroshi Fukuda(outside corporate
auditor)

Yuko Kawamoto(outside corporate
auditor)

Notes: 1. Outside directors and outside corporate auditors qualify as those defined by Article 2,paragraph 3, item 5 of the Enforcement Regulations of the Companies Act of Japan.
2. Current term in office is the length of the term held as of March 31, 2009.
3. Description in the "Attendance of board meetings etc." and "Major activities including theremarks made at board meetings etc." columns includes matters in connection with the boardof corporate auditors' meetings as well as the board of directors' meetings.
4. Of the 16 board of directors' meetings held during the fiscal year ended March 31, 2009, 11
were ordinary meetings, 5 were extraordinary meetings. All of the 11 board of corporate
auditors' meetings held during the fiscal year ended March 31, 2009 were ordinary meetings.

18

(3) Limitation of Liability
Name

Outline of the contract to limit liability

Minoru Makihara (outside director)
Masamitsu Sakurai (outside director)
Haruo Shimada (outside director)
Shigemitsu Miki (outside corporate auditor)
Hiroshi Fukuda (outside corporate auditor)
Yuko Kawamoto (outside corporate auditor)

In accordance with the provisions of Article 427,
paragraph 1 of the Companies Act of Japan, the Company
has entered into an agreement with the persons listed inthis table to limit their liability provided for in Article 423,
paragraph 1 of the Companies Act of Japan. The limitationof liability under the agreement is the higher of either 10
million yen or the amount provided in Article 425,
paragraph 1 of the Companies Act of Japan.

Note: Outside directors and outside corporate auditors qualify as those defined by Article 2, paragraph3, item 5 of the Enforcement Regulations of the Companies Act of Japan.

(4) Remuneration and Other Compensation

Total amount of
remuneration andothercompensation

Number of persons toreceive remunerationand other compensation

Remuneration received
from the insurance
holding company

Remuneration received from theparent company, etc. of theinsurance holding company

6 persons

53 million yen-

Notes: 1. Of the "Remuneration received from the insurance holding company", remuneration inconnection with stock acquisition rights was 6 million yen.
2. The breakdown of the remuneration is as follows.
- Outside directors: 3 persons, 26 million yen- Outside corporate auditors: 3 persons, 27 million yen
3. At its 3rd ordinary general meeting of shareholders held on June 28, 2005, the Company
adopted a resolution to abolish its retirement allowance plans for directors and corporate
auditors and grant entitlements to the directors and corporate auditors who were incumbent at
the time of the resolution to receive retirement allowances, at the time of their respective
retirements, in the amount regarded to have accrued at the time of the resolution. The
remaining number of outside directors and outside corporate auditors who are expected toreceive such payment at the time of their respective retirements and the amounts to be paid
are as follows.
- Outside directors: 3 persons, 30 million yen- Outside corporate auditors: 1 person, 10 million yen(5) Comments of Outside Directors and Outside Corporate Auditors
None.
4. Matters Concerning Common Stock(1) Number of Shares (As of March 31, 2009)
Total number of shares authorized to be issued: 3,300,000 thousand shares
Total number of the issued shares: 804,524 thousand shares (including 16,961 thousand
shares of treasury stock)(2) Total Number of Shareholders (As of March 31, 2009)
105,143
19

(3) Major shareholders (As of March 31, 2009)
Capital contribution
to the Company
Shareholders
Number ofshares held

Ratio ofshares held

thousand shares%

Japan Trustee Services Bank, Ltd. (Trust Account)

46,973

6.0

Japan Trustee Services Bank, Ltd. (Trust Account 4G)

44,765

5.7

The Master Trust Bank of Japan, Ltd. (Trust Account)

44,275

5.6

Moxley & Co.

23,691

3.0

Meiji Yasuda Life Insurance Company

20,498

2.6

The Bank of Tokyo-Mitsubishi UFJ, Ltd.

15,695

2.0

Trust & Custody Services Bank, Ltd. as a trustee for Mizuho
Trust Retirement Benefits Trust Account for Mitsubishi Heavy
Industries, Ltd.

14,074

1.8

State Street Bank and Trust Company 505225

12,307

1.6

The Master Trust Bank of Japan, Ltd. Retirement Benefits
Trust Account for Asahi Glass Co., Ltd.

11,6301.5

The Master Trust Bank of Japan, Ltd. Retirement Benefits
Trust Account for Mitsubishi Corporation

10,832

1.4

Notes: 1. Moxley & Co. is the corporate nominee holder of common stock deposited for the issuance of ADRs.
2. The 14,074 thousand shares held by Trust & Custody Services Bank, Ltd. as a trustee for Mizuho
Trust Retirement Benefits Trust Account for Mitsubishi Heavy Industries are an asset entrusted by
Mitsubishi Heavy Industries, Ltd. for its retirement benefits trust.
3. The 11,630 thousand shares held by The Master Trust Bank of Japan, Ltd. Retirement Benefits Trust
Account for Asahi Glass Co., Ltd. are an asset entrusted by Asahi Glass Co., Ltd. for its retirement
benefits trust.
4. The 10,832 thousand shares held by The Master Trust Bank of Japan, Ltd. Retirement Benefits Trust
Account for Mitsubishi Corporation are an asset entrusted by Mitsubishi Corporation for its
retirement benefits trust.
5. The Company holds 16,961 thousand shares of treasury stock but is not included in "Shareholders"column in the table. During the fiscal year ended March 31, 2009, the Company repurchased 14,682
thousand shares of its own common stock from the market (aggregate purchase price: 49,999 million
yen) pursuant to the resolutions of its board meetings.
6. The ratio of shares held is calculated after deducting 16,961 thousand shares of treasury stock held by
the Company.

20

(Composition ratio by type of shareholders)
Financial institutions:
Financial instruments firms:
Other domestic companies:
Foreign companies:
Individuals and others:

41.0%
0.5%
8.8%
33.6%
16.1%

(The number of outstanding shares as of March 31, 2009: 804,524 thousand shares)

5. Matters Concerning Stock Acquisition Rights(1) Stock Acquisition Rights held by Directors and Corporate Auditors of the Insurance
Holding Company as of the End of the Fiscal Year

Outline of the stock acquisition rights

Directors(except outside
directors)

Outside Directors

The July 2005 Stock Acquisition Rights (a stock option scheme
under a stock-linked compensation plan)- The number of the stock acquisition rights held by:
Directors (except outside directors): 9
Outside directors: 3
Corporate Auditors: 5- Class and number of shares to be issued upon exercise of thestock acquisition rights: 8,500 shares of common stock (500
shares shall be issued upon exercise of each stock acquisitionright.)The July 2006 Stock Acquisition Rights (a stock option scheme
under a stock-linked compensation plan)- The number of the stock acquisition rights held by:
Directors (except outside directors): 8
Outside directors: 0
Corporate Auditors: 3- Class and number of shares to be issued upon exercise of thestock acquisition rights: 5,500 shares of common stock (500
shares shall be issued upon exercise of each stock acquisitionright.)

Number of
persons holding
the stockacquisitionrights

10 persons

3 persons

The July 2007 Stock Acquisition Rights (a stock option scheme
under a stock-linked compensation plan)- The number of the stock acquisition rights held by:
Directors (except outside directors): 80
Outside directors: 9
Corporate Auditors: 33- Class and number of shares to be issued upon exercise of thestock acquisition rights: 12,200 shares of common stock (100shares shall be issued upon exercise of each stock acquisitionright.)
Corporate Auditors

The August 2008 Stock Acquisition Rights (a stock option
scheme under a stock-linked compensation plan)- The number of the stock acquisition rights held by:
Directors (except outside directors): 123
Outside directors: 9
Corporate Auditors: 39
21

5 persons- Class and number of shares to be issued upon exercise of thestock acquisition rights: 17,100 shares of common stock (100shares shall be issued upon exercise of each stock acquisitionright.)
Notes: 1. The July 2005 Stock Acquisition Rights (a stock option scheme under a stock-linked
compensation plan) were issued with especially favorable terms to directors (including nonmembers of the board) and corporate auditors of Tokio Marine Holdings and its major
subsidiaries (collectively referred to as the "Directors and Corporate Auditors"), pursuant to
Articles 280-20 and 280-21 of the former Commercial Code. The status of the stockacquisition rights as of March 31, 2009 and the outline of the stock acquisition rights are as
follows.
- Status as of March 31, 2009
The number of the stock acquisition rights: 123
Class and number of shares to be issued upon exercise of the stock acquisition rights:
61,500 shares of common stock (500 shares shall be issued upon exercise of each stockacquisition rights.)- Outline of the stock acquisition rights
Issue price: Issued without receipt of monetary consideration
Amount to be paid upon the exercise of the stock acquisition rights: 1 yen per share
Exercise period: 30 years from the allotment of the stock acquisition rights
Conditions for the exercise of the stock acquisition rights: Stock acquisition rights held by
any of the "Directors and Corporate Auditors" that he/she received in his/her capacity as adirector (including a non-member of the board) or a corporate auditor of the relevant
entity may only be exercised after he/she has retired from any position as a director(including a non-member of the board) or corporate auditor of such entity.
2. The July 2006 Stock Acquisition Rights (a stock option scheme under a stock-linked
compensation plan), the July 2007 Stock Acquisition Rights (a stock option scheme under astock-linked compensation plan) and the August 2008 Stock Acquisition Rights (a stock
option scheme under a stock-linked compensation plan) were issued to the Directors andCorporate Auditors offsetting their monetary remuneration claims as a consideration for theirservice in the respective companies, pursuant to Article 238, paragraphs 1 and 2 and Article
240 of the Companies Act of Japan. The status of the stock acquisition rights as of March 31,
2009 and the outline of the stock acquisition rights are set forth in the table below.

Number of stockacquisition rights(as of March 31,
2009)Class and numberof shares to beissued upon
exercise of thestock acquisitionrights (as ofMarch 31, 2009)
Amount payable
at issuance
Amount to be paid
upon the exerciseof the stockacquisition rights
Exercise period

The July 2006 Stock
Acquisition Rights (astock option scheme
under a stock-linked
compensation plan)

The July 2007 Stock
Acquisition Rights (astock option scheme
under a stock-linked
compensation plan)

The August 2008 Stock
Acquisition Rights (astock option scheme
under a stock-linked
compensation plan)

101

626

1,219

50,500 shares ofcommon stock (500
shares shall be issued
upon exercise of eachstock acquisitionrights.)62,600 shares ofcommon stock (100shares shall be issued
upon exercise of eachstock acquisitionrights.)121,900 shares ofcommon stock (100shares shall be issued
upon exercise of eachstock acquisitionrights.)2,013,506 yen

491,700 yen

353,300 yen

1 yen per share
30 years from the allotment of the stock acquisition rights

22

Conditions for the
exercise of thestock acquisitionrightsStock acquisition rights held by any of the "Directors and Corporate
Auditors" that he/she received in his/her capacity as a director (including a
non-member of the board) or a corporate auditor of the relevant entity may
only be exercised after he/she has retired from any position as a director(including a non-member of the board) or corporate auditor of such entity.

3. Directors of the Company who were also directors (including non-members of the board) of theCompany's major subsidiaries at the time of the issuance of the stock acquisition rights have beenallotted stock acquisition rights in their capacity as directors (including non-members of the board) of
these companies. The number of such stock acquisition rights held by directors of the Company(excluding outside directors) as of March 31, 2009 is as follows.
The July 2005 Stock Acquisition Rights: 28
The July 2006 Stock Acquisition Rights: 20
The July 2007 Stock Acquisition Rights: 73
The August 2008 Stock Acquisition rights: 116(2) Stock Acquisition Rights Allotted to Employees, etc. during the Fiscal Year

Outline of the stock acquisition rights

Number of
persons who
were allotted
stock acquisitionrights--The August 2008 Stock Acquisition Rights (a stock option
scheme under a stock-linked compensation plan)- The number of the stock acquisition rights: 934- Class and number of shares to be issued upon exercise of thestock acquisition rights: 93,400 shares of common stock (100shares shall be issued upon exercise of each stock acquisitionrights.)65

Employees

Directors, corporate
auditors andemployees ofsubsidiaries

Notes: 1. The above table shows August 2008 Stock Acquisition Rights (a stock option scheme under astock-linked compensation plan) allotted to directors, corporate auditors and employees of
the Company's subsidiaries by offsetting their monetary remuneration claims accrued as aconsideration for their service in the respective subsidiaries.
2. The above table does not include 116 rights of the August 2008 Stock Acquisition Rights (astock option scheme under a stock-linked compensation plan) allotted to the directors of theCompany who were also directors (including non-members of the board) of the Company's
major subsidiaries at the time of the issuance of the stock acquisition rights, which wereallotted in their capacity as directors (including non-members of the board) of thesecompanies by offsetting their monetary remuneration claims accrued as a consideration for
their service in the respective companies.

23

6. Matters Concerning the Independent Auditor(1) Independent Auditor (PricewaterhouseCoopers Aarata)

Name

Remuneration for
the fiscal year
ended March 31,
2009

Other matters

337 million yen- Non-audit services (i.e. services other than those stipulated in
Article 2, paragraph 1 of the Certified Public Accountants
Law) provided to the Company by the independent auditor fora fee: Advisory services for implementation of the quarterly
financial reporting pursuant to the Financial Instruments andExchange Act of Japan

Designated Partners:
Chikakuni Yoshida
Takashi Idesawa
Takaaki Ino

Notes: 1.The audit engagement letter entered into between the Company and the independent auditor
does not clearly distinguish between the remuneration for audit services required by theCompanies Act of Japan and the remuneration for audit services required by the Financial
Instruments and Exchange Act of Japan for these services are practically inseparable.
Accordingly, remuneration for the fiscal year ended March 31, 2009 shown in the above table
represents the total amount of remuneration for all such audit services. This amount includes
foreign currency denominated remunerations that have been translated at the currency
exchange rate as of the closing dated of the fiscal year of the Company.
2. The total amount of cash and other financial benefits payable to the independent auditor by
the Company and its subsidiaries is 705 million yen. This amount includes foreign currency
denominated cash and other financial benefits that have been translated at the currency
exchange rate as of the closing dated of the fiscal year of the Company.

(2) Limitation of Liability
None.
(3) Other matters Concerning the Independent Auditor
a. Policy regarding dismissals or decisions not to reappoint an independent auditor
The Company has adopted a policy regarding decisions on dismissing or not reappointing an
independent auditor as described below.
Policy regarding decisions on dismissing or not reappointing an independent auditor
The Board of Corporate Auditors shall consider dismissing or not reappointing an
independent auditor if the independent auditor falls under any of the items of Article 340,
paragraph 1 of the Companies Act of Japan or if there are any issues that question thesuitability of the independent auditor. If the Board of Corporate Auditors concludes that theindependent auditor should be dismissed or not be reappointed, the Board shall either dismiss
the independent auditor by itself, or shall request the Board of Directors to submit a proposal
to the General Meeting of Shareholders to dismiss or not to reappoint the independent auditor.
b. Audit of financial statements of major subsidiaries of the insurance holding company
conducted by audit firms other than the independent auditor of the insurance holding
company
The financial statements of overseas subsidiaries and affiliates are audited by audit firms
overseas, including the member firms of PricewaterhouseCoopers which is affiliated with
PricewaterhouseCoopers Aarata.
24

7. Basic Policy Regarding Persons Who Control the Company's Decisions on Financial
Matters and Business Policies
The Company has not adopted such a policy at this time.
8. System to assure appropriate business operations
In accordance with the Companies Act of Japan and the Enforcement Regulations of theCompanies Act of Japan, the Company has adopted basic policies for internal controls as
described below.
Basic Policies for Internal Controls
1. System for ensuring that business operations within the Tokio Marine Group (the"Group") are appropriate
As a holding company presiding over the businesses of the Group, Tokio Marine Holdings,
Inc. (the "Company") shall, as appropriate, exercise its rights as a shareholder of its
subsidiaries in a manner consistent with the goal of maximizing the Group’s corporate value.
In accordance with the "Tokio Marine Holdings, Inc. Group Company Management Policies",
the Company shall prescribe the Group's business strategies and various basic policies thatform the foundation of the Group's business management. Furthermore, the Company shallenter into management agreements with each subsidiary that include the identification ofimportant matters requiring the Company's prior approval, such as the subsidiaries’ businessstrategies and plans, thereby enabling the Company to manage the businesses of its
subsidiaries. The management of indirectly-owned subsidiaries shall generally be conducted
through their direct parent companies.
2. System for ensuring that professional duties are performed in accordance with the laws
and the Articles of Incorporation(1) The Company shall establish the Group's basic policy relating to the promotion ofcompliance and implement a system for ensuring compliance of the Group.
(a) The Company shall formulate a Code of Conduct and ensure that the officers and theemployees of the Group understand that top priority should be given to compliance inall phases of business activity with the Code of Conduct.
(b) The Company shall establish a division that oversees compliance issues, as well as aCompliance Committee, to discuss important issues regarding the promotion ofcompliance by the Group. The Company shall also monitor progress toward complianceby the Group and report the results thereof to the Board of Directors.
(c) The Company shall require each of its subsidiaries to prepare a compliance manual andprovide training on laws and internal rules that must be observed by the officers andemployees of such subsidiary with a view toward enhancing compliance.
(d) The Company shall establish reporting rules to be used in the event of violations oflaws or internal rules by a subsidiary and, apart from the usual reporting route, set up
hotlines (an internal whistle-blower system) within the Group while keeping theofficers and employees of the Group companies informed as to the use of the system.
(2) The Company shall establish the Group's basic policy for responding to antisocial
factions and groups, and respond, in an organized and uncompromising manner and inassociation with professionals such as lawyers and the police, to antisocial factions andgroups which threaten the order and safety of civil society.
25

(3) The Company shall perform an effective internal audit using an internal audit divisionthat is independent from other divisions. In addition, the Company shall establish the basic
internal audit policies of the Group, require its subsidiaries to perform an effective internal
audit, monitor the implementation of the internal audit, the status of the internal controls
system and so forth and report the results thereof to the Board of Directors.
3.

System regarding risk management(1) The Company shall formulate the basic policies for risk management of the Group andrequire each subsidiary to carry out its own risk management with respect to the operations of
its business.
(2) The Company shall perform risk management of the entire Group by establishing a Risk
Management Committee that deliberates on important matters concerning the risk
management of the Group, as well as by establishing a unit that controls risk management,
thereby capturing a sense of risk levels across the entire Group. The fundamental process forcarrying out risk management are risk identification, risk evaluation, risk control, creation ofa contingency plan and monitoring and reporting on risk management performance. The
Company shall implement appropriate processes depending on the type of business operations
and the risk characteristics of a subsidiary and shall report on the status of implementation ofrisk management to the Board of Directors.
(3) The Company shall formulate the policies regarding the integrated risk management andperform quantitative risk management of the entire Group to maintain the Group's credit
rating and to prevent bankruptcy.
4.

System for ensuring that professional duties are performed efficiently(1) The Company shall formulate a medium-term management plan and an annual plan for
the Group (including numerical targets, etc.), monitor the status of plan implementation at
subsidiary levels and report the results thereof to the Board of Directors.
(2) The Company shall establish rules regarding the exercise of authority in order to realize
efficient business performance by means of division of responsibilities and a chain ofcommand. At the same time, the Company shall construct an appropriate organizational
structure to achieve its business purpose.
5.

System for protecting the customers' interest

The Company shall establish the Group's basic policies for protection of customers' interestand implement a system for protecting customers' interest, thereby ensuring customeroriented operation and protection of customers' interest.
6.

System for keeping and managing information with respect to directors’ performance of
dutiesThe Company shall establish rules on keeping and managing documents and so forth. The
minutes of important meetings, other important documents and so forth, including
information on the performance of directors’ duties, shall be properly kept and managed inaccordance with such rules.
7.

System for ensuring the appropriateness and reliability of financial reporting

The Company shall establish the necessary system to ensure the appropriateness andreliability of financial reporting of the Group, monitor the effectiveness of the system on a26

periodic basis and report the result thereof to the Board of Directors.
8.

System regarding audit by corporate auditors(1) System of reporting to corporate auditors(a) Directors shall regularly report the status of management, financial condition,compliance, risk management, internal audit and so forth to corporate auditors, andwhen, in connection with execution of their functions, they find any material
violation of laws or internal rules or any other condition or fact that may cause
considerable damage to the Company, they shall immediately make a report thereof
to corporate auditors.
(b) Corporate auditors shall attend meetings of the Board of Directors and otherimportant meetings or committees such as the management meetings and express
their opinion. Furthermore, minutes of important meetings and other important
documents relating to decisions approved by directors shall be shown to corporate
auditors at any time upon request from corporate auditors.
(c) Status of the hotline operation and important reporting and consultation mattersshall be reported regularly to corporate auditors.
(d) Directors and employees shall explain matters concerning the operation of theirbusinesses at any time upon request from corporate auditors.
(2) Matters concerning employees assisting with the auditing duties of corporate auditors,
including matters concerning such employees’ independence from directors(a) In order to assist corporate auditors in carrying out their duties, the Company shallestablish a secretariat under the direct control of corporate auditors. Upon requestfrom corporate auditors, the Company shall assign full-time staffs who have theknowledge and ability to assist the audit.
(b) The staffs assigned to the secretariat of corporate auditors shall perform theirassigned tasks ordered by corporate auditors and other work that is required to assist
the audit, and such staffs shall have the right to collect the necessary information.
(c) The performance evaluation and transfer of, and disciplinary action against, such
staffs shall be carried out with the approval of the standing corporate auditors.
(3) Coordination with corporate auditors of subsidiaries
Corporate auditors shall, based on audit standards and so forth, request corporate auditors ofsubsidiaries to report regularly on important matters regarding the respective subsidiaries,
such as the audit policy, audit status, audit results and so forth and shall endeavor to closely
work with corporate auditors of subsidiaries in order to perform effective auditing.
Additionally, corporate auditors shall receive updates from directors or employees ofsubsidiaries on the status of their duties at the respective subsidiaries as necessary.
9. Matters Concerning Accounting Advisers (Kaikei Sanyo)
Not applicable, since the Company does not have accounting advisers (kaikei sanyo).
10. Other Matters
None.
27

Consolidated Balance Sheet as of March 31, 2009
(Yen in millions)
As of March 31, 2009
Item

Amount(Assets)

461,589352,576
302,89347,224
458,556
8,688
10,695,095
611,310
338,414161,238
142,607
10,65823,909427,931
4,341
290,577
133,0121,241,986
219,116
102,208-20,368
15,247,223

Cash and deposits
Call loans
Receivables under resale agreement
Receivables under securities borrowing transactions
Monetary receivables bought
Money trusts
Securities
Loans
Tangible fixed assets
Land
Buildings
Construction in progress
Other tangible fixed assets
Intangible fixed assets
Software
Goodwill
Other intangible fixed assets
Other assets
Deferred tax assets
Customers' liabilities under acceptances and guarantees
Reserve for bad debts
Total assets(Liabilities)
Underwriting funds
Outstanding claims
Underwriting reserves
Corporate bonds
Other liabilities
Payable under securities lending transactions
Other liabilities
Reserve for retirement benefits
Reserve for retirement benefits for directors and corporate auditors
Reserve for employees' bonuses
Reserve for retirement of fixed assets
Reserve under the special law

11,253,382
1,192,416
10,060,966
299,922
1,536,993
600 575
600,575
936,417
148,50688
20,272
3,359
56,44956,449Reserve for price fluctuation

41,937
144,587
102,208
13,607,708

Deferred tax liabilities
Negative goodwill
Acceptances and guarantees
Total liabilities(Net assets)

150,000
1,006,891-59,663
59 663
1,097,227

Common stock
Retained earnings
T
Treasurystockt k
Total stockholders' equity
Unrealized gains on securities, net of taxes

608,106

Deferred gains and losses on hedge transactions

17,796-95,297
530,605

Foreign currency translation adjustments
Total valuation and translation adjustments

849
10,832
1,639,514
15,247,223

Stock acquisition rights
Minorityy interest
Total net assets
Total liabilities and net assets

28

Consolidated Statement of Income for the fiscal year ended March 31, 2009
(Yen in millions)Year ended March 31, 2009

AmountItem
Ordinary income

3,503,102

Underwriting income

3,130,076

Net premiums written

2,134,243

Deposit premiums from policyholders

166,255

Investment income on deposit premiums from policyholders

71,021

Life insurance premiums

746,083

Reversal of outstanding claims

7,915

Other underwriting income

4,557

Investment income

306,664

Interest and dividends

237,622

Gains on investment in money trusts

38

Gains on sales of securities

71,693

Gains on redemption of securities

482

Gains on derivative transactions

64,639Other investment income

3,209Transfer of investment income on deposit premiums-71,021

Other ordinary income

66,361

Amortization of negative goodwill
Other ordinary income

10,60455,757

Ordinary expenses

3,518,230

Underwriting expenses

2,232,902

Net claims paid

1,306,574

Loss adjustment expenses

87,634

Agency commissions and brokerage

442,153

Maturity refunds to policyholders

271,180

Dividends to policyholders

316Life insurance claims

90,935

Provision for underwriting reserves

21,443

Other underwriting expenses

12,663

Investment expenses

726,659

Losses on investment in money trusts

2,619

Losses on trading securities

1,130

Losses on sales of securities

33,365

Impairment losses on securities

162,205

Losses on redemption of securities

18,120Losses on separate account

440,628

Other investment expenses

68,591

Operating and general administrative expenses

519,928

Other ordinary expenses

38,739Interest paid

13,470

Provision of reserve for bad debts

5,693

Losses on bad debts

299

Equity in losses of affiliates

5,085

Other ordinary expenses

14,190Ordinary profit or losses-15,128Extraordinary gains

83,761

Gains on disposal of fixed assets

3,146

Reversal of reserve under special law

65,540

Reversal of reserve for price fluctuation

65,540

Other extraordinary gains

15,074Extraordinary losses

21,696

Losses on disposal of fixed assets

2,430

Impairment losses on fixed assets

7,313

Other extraordinary losses

11,952

Income or loss before income taxes

46,937

Income taxes - current

37,402

Income taxes - deferred-12,577

Total income taxes

24,824

Minority interest-1,028Net income

23,14129

Consolidated Statement of Changes in Stockholders' Equity for the fiscal year ended March 31, 2009
(Yen in millions)Year ended March 31, 2009
(April 1, 2008 to March 31,
2009)
Stockholders' equity
Common stock
Beginning balance
Changes during the year
Total changes during the year
Ending balance
Retained earnings
Beginning balance
Changes due to the change of accounting policies applied to foreign subsidiaries
Changes during the year
Dividends
Net income
Disposition of treasury stocks
Changes in the scope of consolidation
Changes in the scope of equity method affiliates
OthersTotal changes during the year
Ending balance
Treasury stock
Beginning balance
Changes during the year
Repurchase of treasury stocks
Disposition of treasury stocks
Total changes during the year
Ending balance
Total stockholders' equity
Beginning balance
Changes due to the change of accounting policies applied to foreign subsidiaries
Ch
Changesduringd i theth yearDividends
Net income
Repurchase of treasury stocks
Disposition of treasury stocks
Changes in the scope of consolidation
Changes in the scope of equity method affiliates
OthersTotal
Tt l changeshdduringi theth yearEnding balance30

150,000
150,000
1,010,521
13,306-43,168
23,141
-138
138
1,900
1,997
-670
-16,936
1,006,891-9,792-50,302431-49,871-59,663
1,150,728
13,306-43,168
23,141-50,302
292
1,900
1,997
-670
-66,807
66 807
1,097,227

Consolidated Statement of Changes in Stockholders' Equity for the fiscal year ended March 31, 2009
(Yen in millions)Year ended March 31, 2009
(April 1, 2008 to March 31,
2009)
Valuation and translation adjustments
Unrealized gains on securities, net of tax
Beginning balance
Changes during the year
Net changes in items other than stockholders' equity
Total changes during the year
Ending balance
Deferred gains and losses on hedge transactions
Beginning balance
Changes during the year
Net changes in items other than stockholders' equity
Total changes during the year
Ending balance
Foreign currency translation adjustments
Beginning balance
Changes during the year
Net changes in items other than stockholders' equity
Total changes during the year
Ending balance
Stock acquisition rights
B i i balance
Beginningb lChanges during the year
Net changes in items other than stockholders' equity
Total changes during the year
Ending balance
Minority interest
Beginning balance
Changes during the year
Net changeshiin iitems otherh thanh stockholders'kh ldequityi
Total changes during the year
Ending balance
Total net assets
Beginning balance
Changes due to the change of accounting policies applied to foreign subsidiaries
Changes during the year
Dividends
Net income
Repurchase of treasury stocks
Disposition of treasury stocks
Changes in the scope of consolidation
Changes in the scope of equity method affiliates
OthersNet changes in items other than stockholders' equity
g duringg the yyear
Total changes
Ending balance(Note)"Others" for the fiscal year ended March 31, 2009 include valuation adjustments of assets in accordance withaccounting standards of foreign countries where equity method affiliates are located.

31

1,402,487-794,381
794 381-794,381
608,106
11,9525,844
5,844
17 796
17,796-1,673-93,623-93,623-95,297
619
229
229
849
15,224-4,392-4,392
10,832
2,579,339
13,306-43,168
23,141-50,302
292
1,900
1,997
-670
-886,323,-953,131
1,639,514

Basis of consolidated financial statements
1. Scope of consolidation(1) Number of consolidated subsidiaries: 61 companies
Tokio Marine & Nichido Fire Insurance Co., Ltd. ("Tokio Marine & Nichido")
Nisshin Fire & Marine Insurance Co., Ltd. ("Nisshin Fire")
Tokio Marine & Nichido Life Insurance Co., Ltd. (“Tokio Marine & Nichido Life”)
Tokio Marine & Nichido Financial Life Insurance Co., Ltd. (“Tokio Marine & Nichido Financial
Life”)
Millea Nihon Kosei SS Insurance Co., Ltd.
Philadelphia Consolidated Holding Corp.
Philadelphia Indemnity Insurance Company
Tokio Marine Global Ltd.
Kiln Group Limited
Kiln Underwriting Limited
Tokio Marine Bluebell Re Limited
Tokio Marine Asia Pte. Ltd.
Asia General Holdings Limited
Tokio Marine Insurance Singapore Ltd.
TM Asia Life Singapore Ltd.
TM Asia Life Malaysia Bhd.
Tokio Marine Seguradora S.A.
Tokio Millennium Re Ltd.
Tokio Marine Financial Solutions Ltd.
Philadelphia Consolidated Holding Corp., Philadelphia Indemnity Insurance Company and 12
other companies are included in the consolidation beginning with the fiscal year ended March 31,
2009 as these entities became subsidiaries of the Company through the acquisition of shares,
formation as new companies or for other reasons.
Vetra Finance Corporation ("Vetra") and one other company are excluded from the consolidation
beginning with the fiscal year ended March 31, 2009 as Vetra ceased to operate its bond investment
business and redeemed the subordinated income notes that it had previously issued to Tokio
Marine & Nichido to fund Vetra’s bond investment business.
Kiln Ltd and Kiln Reinsurance Ltd are excluded from the consolidation beginning with the fiscal
year ended March 31, 2009 because these companies have been dissolved.
Asia General Asset Bhd. and one other company are excluded from the consolidation of theCompany beginning with the fiscal year ended March 31, 2009 because procedures to dissolvethese two companies have commenced.
Additionally, there were following name changes of subsidiaries during the fiscal year ended
March 31, 2009.
Old
TM Asia Insurance Singapore Ltd.
Real Seguros S.A.
Kiln (UK) Holdings Limited

New
Tokio Marine Insurance Singapore
Ltd.
Tokio Marine Seguradora S.A.
Kiln Group Limited

32

Effective dateJuly 1, 2008
August 20, 2008
January 19, 2009

(2) Names of major non-consolidated subsidiaries
Tokio Marine & Nichido Adjusting Service Co., Ltd. and Tokio Marine Capital Co., Ltd. are
non-consolidated subsidiaries of the Company. Each non-consolidated subsidiary is small in scalein terms of total assets, sales, net income or loss for the period and retained earnings. As suchnon-consolidated subsidiaries are not considered to materially affect any reasonable determination
as to the Group’s financial condition and results of operations and are excluded from theconsolidation.
2. Application of the equity method(1) Number of affiliates accounted for by the equity method: 8 companies
Names of major affiliates accounted for by the equity method:
Sino Life Insurance Co., Ltd.
Beginning with the fiscal year ended March 31, 2009, IBEX Insurance Services Limited isaccounted for by the equity method as it became an affiliate of the Company through theacquisition of shares.
International Marine Insurance Managers SA (Pty) Ltd (“IMIM”) is no longer an affiliate
accounted for by the equity method as the Company increased its equity interest in IMIM and
IMIM became a subsidiary of the Company during the fiscal year ended March 31, 2009.
Tianan Insurance Company Limited (“Tianan”) is no longer an affiliate accounted for by the equity
method as the Company’s equity interest in Tianan has been diluted as a result of Tianan’s issuanceof new shares to third parties during the fiscal year ended March 31, 2009.
Real Tokio Marine Vida e Previdência S.A. is no longer an affiliate accounted for by the equity
method as all of its shares previously held by the Company through a subsidiary were sold during
the fiscal year ended March 31, 2009.
(2) The non-consolidated subsidiaries (Tokio Marine & Nichido Adjusting Service Co., Ltd., Tokio
Marine Capital Co., Ltd., etc.) and other affiliates (IFFCO-TOKIO General Insurance Co., Ltd.,etc.) have not been accounted for by the equity method because these companies have had a minor
effect on the Company’s consolidated net income or loss and retained earnings for the fiscal year
ended March 31, 2009 and are not considered material as a whole.
(3) The Company owns 30.1% of the total voting rights of Japan Earthquake Reinsurance Co., Ltd.
through Tokio Marine & Nichido and Nisshin Fire. The Company does not consider Japan
Earthquake Reinsurance Co., Ltd. to be its affiliate since it believes that it can not exert asignificant influence on any policy making decisions of Japan Earthquake Reinsurance Co., Ltd.’s
operations given the highly public nature of the company.
(4) With regard to any company accounted for by the equity method that has a different closing datefrom that of the consolidated financial statements, the financial statements of that company for its
fiscal year are used for presentation in the consolidated financial results.
3. Closing date of consolidated subsidiaries
The closing date of the fiscal year for one of the domestic consolidated subsidiaries and 51 overseas
consolidated subsidiaries is December 31. Since the differences in the closing dates do not exceed

33three months, the financial statements of the consolidated subsidiaries as of December 31 are used forpresentation in the accompanying consolidated financial statements. As for any significant transactions
taking place during the period between the subsidiaries’ closing dates and the consolidated closing
date, necessary adjustments are made for consolidation purposes.
4. Accounting policies(1) Valuation of securities
a. Trading securities are valued by the mark-to-market method, with the costs of their sales being
calculated on the moving-average method.
b. Bonds held to maturity are recorded by using the amortized cost method (straight-line method)
based on the moving-average method.
c. Bonds earmarked for policy reserves are recorded by using amortized cost method (straight-line
method) based on the moving-average method, in accordance with the Industry Audit Committee
Report No. 21 “Temporary Treatment of Accounting and Auditing Concerning Securities
Earmarked for Policy Reserve in Insurance Industry” issued by the Japanese Institute of Certified
Public Accountants (the “JICPA”), November 16, 2000.
Debt securities earmarked for policy reserve are recognized in the amount of 322,195 million yen
on the consolidated balance sheet. The fair value thereof is 341, 360 million yen.
Following is a summary of the risk management policy concerning bonds earmarked for policy
reserves.
In order to control interest rate fluctuation risks relating to assets and liabilities, Tokio Marine &Nichido Life divides their policy reserves into following subgroups: "dollar-denominated policy
reserve for deferment period of individual annuity insurance (denominated in U.S. dollars) withfloating cancellation refund linked with market interest rates", "policy reserve for deferment
period of individual annuity insurance with floating interest rates", "policy reserve for lump sum
deposit-type whole-life insurance denominated in U.S. dollars with floating interest rates" "policy
reserve for lump sum deposit-type whole-life insurance with floating interest rates" and "policy
reserve for lump sum deposit-type individual annuity insurance". Tokio Marine & Nichido Life
maintains the policy to match the duration of policy reserves of each subgroup and bonds
earmarked for the policy reserve within certain time range.
d. Other securities with fair value are recorded by the mark-to-market method based upon themarket price on the closing date.
The total amount of unrealized gains/losses on such securities is directly added to net assets withcosts of sales being calculated on the moving-average method.
e. Other securities not with fair value are either recorded at cost based on moving-average oramortized cost method (straight-line method).
f. Equity shares in non-consolidated subsidiaries and affiliates that are not subject to the equity
method are recorded at cost determined by the moving-average method.
g. Securities held in individually managed money trusts that are invested as trusted assets arerecorded by the mark-to-market method.

34

(2) Valuation of derivative financial instruments

Derivative financial instruments are accounted for by the mark-to-market method.
(3) Depreciation method of tangible fixed assets
Depreciation of tangible fixed assets owned by the Company and its domestic consolidated
subsidiaries is computed using the declining balance method. However, depreciation of buildings(excluding auxiliary facilities attached to such buildings, etc.) that were acquired on or after April 1,
1998 is computed using the straight-line method.
(4) Depreciation method for intangible fixed assets
Depreciation of intangible fixed assets procured through acquisitions of overseas subsidiaries isrecorded over the period of time for which the Company expects such subsidiaries contribute to theCompany, and in accordance with the form of such contribution.
(5) Accounting policies for significant reserves and allowances
a. Reserve for bad debts
In order to provide for losses from defaults, domestic consolidated subsidiaries of the Company
establish reserves for bad debts in accordance with internal asset self-assessment and asset write-off
rules as detailed below.
For claims against any debtor who has legally, technically, or substantially become insolvent (due tobankruptcy, special liquidation or suspension of transactions at draft clearinghouses, etc.), reserves arecalculated based on the amount of any such claim minus the amount expected to be collectible from
disposal of collateral or performance of applicable guarantees.
For claims against any debtor who is likely to become insolvent in the foreseeable future, reserves arecalculated based on the amount of any such claim minus the amount expected to be collectible from
disposal of collateral, performance of applicable guarantees or the relevant debtor himself, taking into
consideration the overall solvency assessment of the relevant debtor.
For claims other than those described above, reserves are provided based on the amount of claims
multiplied by the expected default rate, which is computed based on historical loan loss experience in
certain previous periods.
For specified overseas claims, the amount of projected losses arising from political or economic
conditions in the relevant countries is recorded as reserves for specified overseas claims.
In addition, all claims are assessed by the asset accounting department and the asset management
department in accordance with the internal rules of asset self-assessment. Subsequently, the asset
auditing department, which is independent from other asset-related departments, audits the results ofassessment by the other asset-related departments. Reserves for bad debts are recorded based on suchassessment results and audits stated above.
b. Reserve for retirement benefits
To provide for employees’ retirement benefits, the Company and its domestic consolidated subsidiaries
have recorded the amount deemed to be incurred at the end of the fiscal year ended March 31, 2009
based on the projected retirement benefit obligations and related pension assets at the end of the fiscal
year ended March 31, 2009.

35

Prior service costs are charged to expenses in each subsequent consolidated fiscal year by using thestraight-line method over a certain term (14 years) within the average remaining service years of theemployees when such costs were incurred.
Actuarial differences are charged to expenses in the subsequent consolidated fiscal year by using thestraight-line method over a certain term (1 - 14 years) within the average remaining service years of
the employees.
c. Reserve for retirement benefits for directors and corporate auditors
Some domestic consolidated subsidiaries set aside a reserve for retirement benefits for their directors
and corporate auditors in the amount considered to be accrued as of the end of the fiscal year ended
March 31, 2009, which is calculated in accordance with their internal remuneration regulations.
d. Reserve for employees’ bonuses
To provide for payment of bonuses to employees, the Company and its major consolidated domestic
subsidiaries maintain reserves for employees' bonuses based on the expected amount to be paid.
e. Reserve for retirement of tangible fixed assets
To provide for payment of expenses related to dismantling a building, Tokio Marine & Nichido
provided a reserve for retirement of tangible fixed assets based on the projected amount to be paid fordismantling the building.
f. Reserve for price fluctuation
Domestic consolidated insurance subsidiaries maintain reserves under Article 115 of the Insurance
Business Law of Japan in order to provide for possible losses or damages arising from pricefluctuation of stock, etc.
(6) Accounting for consumption tax, etc.
The Company and its domestic consolidated subsidiaries account for consumption tax, etc. by the
tax-excluded method. However, domestic consolidated insurance subsidiaries account for expenses
such as operating and general administrative expenses by the tax-included method.
In addition, any non-deductible consumption tax, etc incurred in connection with assets is included inother assets (as suspense payments) and is amortized over five years using the straight-line method.
(7) Accounting for significant lease transactions
With the exception of transactions in which ownership of leased properties was deemed to betransferred to lessees, the Company accounted for finance lease transactions with lease periods
commencing prior to April 1, 2008 under the accounting policy applied to normal lease transactions.
(8) Accounting for significant hedging activities
a. Interest rate
To mitigate interest rate fluctuation risks associated with long-term insurance policies, Tokio Marine &Nichido and Tokio Marine & Nichido Life conduct asset liability management to control such risks byevaluating and analyzing financial assets and insurance liabilities simultaneously.
As for interest rate swap transactions that are used to manage such risks, Tokio Marine & Nichido andTokio Marine & Nichido Life apply deferred hedge accounting to the swap transactions and evaluate
hedge effectiveness based upon the Industry Audit Committee Report No. 26, “Accounting and
Auditing Treatments related to Adoption of Accounting for Financial Instruments in the Insurance

36

Industry” (issued by the JICPA, September 3, 2002 - hereinafter called “Report No. 26”). Hedge
effectiveness is evaluated by verifying the interest rate characteristics that influence the calculation ofa theoretical price for both the hedged instruments and the hedging tools. Any deferred gains as of theend of March 2003 that were calculated based on the Industry Audit Committee’s Report No.16,"Accounting and Auditing Treatments related to Adoption of Accounting for Financial Instruments in
the Insurance Industry" (issued by the JICPA, March 31, 2000), which was applicable prior to theapplication of Report No. 26, are accounted for by Tokio Marine & Nichido using the straight-line
method over the remaining hedging period (1-17 years). Tokio Marine & Nichido Life also uses thestraight-line method to account for such deferred gains as of the end of March 2002 over theremaining hedging period (6-10 years). The accounting treatments for such deferred gains are based on
the transitional measures in Report No. 26. Deferred gains under this transitional treatment as ofMarch 31, 2009 was 35,922 million yen and the amount accounted for in the consolidated financial
statements for the fiscal year ended March 31, 2009 was 11,654 million yen.
Tokio Marine & Nichido applies deferred hedge accounting for interest rate swap transactions which
are used to hedge the interest rate risk relating to corporate bonds issued by Tokio Marine & Nichido.
Hedge effectiveness is not evaluated, since hedged instruments and hedging tools are believed to behighly hedge-effective since they share the same important characteristics.
b. Foreign exchangeWith regard to some of Tokio Marine & Nichido’s currency swap and forward transactions, whichhave been entered into for the purpose of hedging foreign exchange risk associated with assets
denominated in foreign currencies, (a) deferred hedge accounting and/or (b) fair value hedge
accounting are applied. Likewise, with regard to Nisshin Fire's currency swap and forward
transactions, matching treatment is applied. The effectiveness of these hedging treatments is evaluatedby assessing the price fluctuation of both hedging tools and hedged instruments. However, hedge
effectiveness is not evaluated for hedging treatments that are believed to have high hedge effectiveness,such as in cases where hedging tools and hedged instruments share the same important characteristics.
5. Matters concerning valuation of assets and liabilities of consolidated subsidiaries
The Company has adopted the mark-to-market method.
6. Matters concerning amortization of goodwill and negative goodwill
Negative goodwill recognized as a liability on the consolidated balance sheet is amortized over 20
years using the straight-line method.
Goodwill recognized as an asset on the consolidated balance sheet is amortized in the following
manner. The goodwill in connection with Philadelphia Consolidated Holding Corp. and Kiln Group
Limited is amortized over 20 years and 10 years, respectively, using the straight-line method. Other
goodwill is amortized over 5 to 15 years using the straight-line method.
Other goodwill and negative goodwill in small amounts are amortized at one time.
Changes in the basis of consolidated financial statements
1. The Company has adopted "Practical Solution on Unification of Accounting Policies Applied toForeign Subsidiaries for Consolidated Financial Statements" (ASBJ Practical Issues Task Force
No. 18, May 17, 2006) for the fiscal year ended March 31, 2009 and implemented adjustments37required for the consolidated financial reporting. As a result, for the fiscal year ended March 31,
2009, ordinary loss decreased, and net income before income taxes increased, 4,351 million yen,respectively.
2. With the exception of transactions in which ownership of leased properties was deemed to betransferred to lessees, the Company accounted for finance lease transactions with lease periods
commencing prior to April 1, 2008 under the accounting policy applied to normal leasetransactions. However, beginning with the fiscal year ended March 31, 2009, the Company has
adopted "Accounting Standard for Lease Transactions" (ASBJ Statement No. 13, ASBJ 1st
Division, June 17, 1993, revised as of March 30, 2007) and "Guidance on Accounting Standard forLease Transactions" (ASBJ, Guidance No. 16, The Japanese Institute of Certified Public
Accountants, Accounting Practice Committee, January 18, 1994, revised as of March 30, 2007).
Accordingly, financial lease transactions in which ownership of leased properties was deemed to
be transferred to lessees and whose lease periods commenced on or after April 1, 2008, areaccounted for as normal sales transactions.
The impact of the changes described above on ordinary loss and net income before income taxes
for the fiscal year ended March 31, 2009 is considered immaterial.
Changes in presentation
Balance sheet
Beginning with the fiscal year ended March 31, 2009, in accordance with the amendments to the
Enforcement Regulations of Insurance Business Law of Japan, it is required to present "Land","Buildings", "Construction in progress" and "Other tangible fixed assets" as the breakdown of"Tangible fixed assets", and "Software", "Goodwill" and "Other intangible fixed assets" as thebreakdown of "Intangible fixed assets".
The breakdown of tangible fixed assets and intangible fixed assets for the fiscal year ended March 31,
2008 was as follows:
Land: 165,480 million yen, Buildings: 145,497 million yen, Construction in progress: 2,629 million
yen, Other tangible fixed assets: 24,760 million yen, Software: 3,614 million yen, Goodwill: 45,224
million yen and Other intangible fixed assets: 6,431 million yen.
Consolidated Statement of Changes in Stockholder's Equity
Beginning with the fiscal year ended March 31, 2009, the item previously presented as "Decrease inconnection with newly consolidated subsidiaries" is presented as two separate items: "Changes in thescope of consolidation" and "Changes in the scope of equity method affiliates". The purpose of thischange is to improve the comparability of the Company’s consolidated financial statements.
The amounts for "Changes in the scope of consolidation" and "Changes in the scope of equity method
affiliates" for the fiscal year ended March 31, 2008 were 1,056 million yen and -5,483 million yen,respectively.
Notes to consolidated balance sheet
1. Accumulated depreciation of tangible fixed assets is 362,697 million yen and advanced depreciation38

of such assets is 23,969 million yen.
2. Of all loans and receivables, the total amount of loans to borrowers in bankruptcy, past due loans,loans contractually past due for three months or more, and restructured loans is 13,831 million yen.
The breakdown is set forth below.
(1) The amount of loans to borrowers in bankruptcy is 2,853 million yen.
Loans that are past due for a certain period, or for other reasons, are generally placed on non-accrual
status when substantial doubt is considered to exist as to the ultimate collectibility either of principal
or interest ("Non-accrual status loans"; however, any part of bad debt written-off is excluded.). Loansto borrowers in bankruptcy represent non-accrual status loans that fall within the definitions provided
in Article 96, paragraph 1, subparagraph 3 (a) to (e) (maximum amount transferable to reserve for bad
debts) and subparagraph 4 of the Enforcement Ordinance of the Corporation Tax Law (Ordinance No.
97, 1965).
(2) The amount of past due loans is 5,465 million yen. Past due loans are non-accrual status loans,other than those to borrowers in bankruptcy, or those on which interest payments are deferred in order
to assist business restructuring of the borrowers.
(3) The amount of loans contractually past due for three months or more is 107 million yen. Loans
contractually past due for three months or more are defined as loans on which any principal orinterests payments are delayed for three months or more from the date following the due date. Loansclassified as loans to borrowers in bankruptcy and past due loans are excluded from this category.
(4) The amount of restructured loans is 5,405 million yen. Restructured loans are loans on which
concessions (e.g. reduction of the original interest rate, deferral of interest payment, extension of thematurity date, forgiveness of debt) are granted to borrowers in financial difficulties to assist them intheir corporate restructuring by improving their ability to repay creditors. Restructured loans do notinclude loans classified as loans to borrowers in bankruptcy, past due loans or loans past due for threemonths or more.
3. The value of assets pledged as collateral totals 330,405 million yen in securities, 9,125 million yen
in savings deposits, 375 million yen in land and 1,327 million yen in buildings. Collateralized debt
obligations are held to the value of 65,233 million yen in outstanding claims, 51,724 million yen inunderwriting reserve and 59,334 million yen in other debts (including foreign reinsurance related debts,etc.).
4. Securities received in connection with securities borrowing transactions have a fair value of 75,343
million yen.
5. Securities include securities lent under loan agreements of 595,987 million yen.
6. The outstanding balance of undrawn committed loans is as follows.

Total loan commitments
Balance of drawn committed loans
Undrawn loan commitments(Yen in millions)101,127
16,01985,108

7. The amount of both assets and liabilities for special account as prescribed in Article 118 of the39

Insurance Business Law of Japan totals 1,876,816 million yen.
8. Total investment in non-consolidated affiliates is 83,828 million yen.
9. Tokio Marine & Nichido guarantees the liabilities of some of its subsidiaries. The balance of theguarantee to its subsidiaries as of March 31, 2009 is as follows.
(Yen in millions)
TNUS Insurance Company
22
Tokio Marine Compaňía de Seguros, S.A. de C.V.
4,880
Tokio Marine Pacific Insurance Limited
1,876
The Tokio Marine & Nichido Fire Insurance Company (China) Limited
6,088
Total
12,868Notes to consolidated statement of income
1. Major components of business expenses(Yen in millions)
Agency commissions, etc.
397,387
Salaries
207,980
Business expenses consist of "Loss adjustment expenses", "Operating and general administrative
expenses" and "Agency commissions and brokerage" as shown in the accompanying consolidated
statement of income.
2. In accordance with Paragraph 9 of the “Implementation Guidelines for Equity Method Accounting”(Accounting Practice Committee, Report No.9) and Paragraph 32, Subparagraph 1 of the“Implementation Guidelines for Capital Consolidation in Consolidated Financial Statements”(Accounting Practice Committee, Report No.7), the depreciation amount of 1,892 million yen on
goodwill in connection with Sino Life Insurance Co., Ltd. is included in “Equity in losses ofaffiliates”.
3. The main component of other extraordinary gains is gains on sales of shares of affiliates amounting
to 14,275 million yen.
4. The Company recognized impairment losses on the following properties during the fiscal year
ended March 31, 2009.
Purpose of use

Category

Location

Properties forbusiness use(derivative
business andelderly carebusiness)
Properties for rent

Land,
buildings andothers10 properties
including a buildingin Yokohama-shi,
Kanagawa Pref.

Land andbuildings

A building inIwaki-shi, Fukushima
Pref.

40

Impairment loss (Yen in millions)
Land
Building Others
Total
222
1,956
365
2,544

22

71

-

93

Idle or potential
disposal
properties

Land,
buildings andothersOthersGoodwill

55 properties
including a buildingin Kashiwa-shi,
Chiba Pref.
-

Total

1,313

419

1,050

2,784

1,558

2,447

1,890
3,307

1,890
7,313

(1) Properties
Classification of properties: (a) properties used for the insurance business and other businesses aregrouped by each business unit and (b) other properties including properties for rent and idle orpotential disposal properties are grouped on an individual basis.
The total amount of projected future cash flow generated from the derivative business and the elderly
care business fell below the book values of the properties used for these businesses. Consequently, theCompany wrote off the excess of the book values of such properties over the recoverable values andrecognized such write offs as impairment losses in extraordinary losses.
The Company calculated the recoverable value of the relevant property by discounting projected
future cash flows at a rate of 1.4% to 6.0%.
Due mainly to decline in the real estate market, book values of some properties for rent and idle orpotential disposal properties fell below the recoverable values. Consequently, the Company wrote off
the excess of the book values of such properties over the recoverable values and recognized any such
write off as impairment losses in extraordinary losses.
Recoverable values are either the higher of the net sales price or the utility values of each property. Net
sales price is the market value assessed by real estate appraisers minus anticipated expenses for
disposal of the relevant properties. The Company calculated the utility values of the relevant properties
by discounting the projected future cash flows at a rate of 7.7%.
(2) Goodwill
An impairment loss of 1,890 million yen was recognized and recorded as “extraordinary losses” forthe fiscal year ended March 31, 2009 for goodwill relating to Tokio Marine Seguradora S.A., because
the Company concluded that Tokio Marine Seguradora S.A. would not achieve the initially expectedlevels of profit.
5. The main components of other extraordinary losses are 7,668 million yen losses on revaluation ofshares of affiliates and 3,139 million yen losses on redemption of shares of affiliates.
Notes to consolidated statement of changes in stockholders' equity
1. Class and number of issued shares and treasury stock
Number ofshares as ofMarch 31, 2008

Increase during
the fiscal year
ended March 31,
2009(Unit: thousand shares)
Decrease during Number ofshares as of
the fiscal year
ended March 31, March 31, 2009
2009

Issued shares
Common stock

804,524-41-

804,524

TotalTreasury stock
Common stock
Total

804,524--804,524

2,293
2,293

14,772
14,772

104
104

16,961
16,961

Note 1. The increase of 14,772 thousand shares of treasury stock is primarily attributable to theacquisition of 14,682 thousand shares to implement financial policies.
2. The decrease of 104 thousand shares of treasury stock is primarily attributable to theallotments of shares in connection with exercises of stock acquisition rights which
decreased treasury stock by 75 thousand.
2. Stock acquisition rights (including those owned by the Company)
Nature of stock acquisitionrightsCategory
The Company(parent company)

Amount as of March 31, 2009
(yen in millions)

Stock acquisition rights as
stock options849

3. Dividends(1) Amount of dividends
Resolution
Ordinary general
meeting ofshareholders heldon June 23, 2008
Meeting of theboard of directors
held on November
19, 2008

Class ofstock

Total amountof dividends
paid

Amount ofdividends per
share

Commonstock

24,066 million
30 yenyen

March 31,2008

June 24,
2008

Commonstock

19,101 million
24 yenyen

September
30, 2008

December
10, 2008

Effective
date

Record date(2) Dividends of which the record date falls within the fiscal year ended March 31, 2009, and of which
the effective date falls after March 31, 2009.
The Company intends to obtain approval for the following dividend payment at the 7th Ordinary
General Meeting of Shareholders to be held on June 29, 2009.

Resolution

Class of
stock

Total
amount ofdividends
paid

Source ofdividends

Amount ofdividends
per share

Ordinary general
meeting ofshareholders to beheld on June 29, 2009

Commonstock

18,901
millionyen

Retainedearnings

24 yenPer share information
Net assets per share
Net income per share

2,066.92 yen
29.13 yen

42

Recorddate

Effective
date

March 31,2009

June 30,
2009

Other notes
Matters concerning business combination are as follows.
As of December 1, 2008, the Company acquired Philadelphia Consolidated Holding Corp. (“PHLY”),
a property and casualty insurance group in the U.S., and made it an indirect subsidiary held throughTokio Marine & Nichido, which is a wholly owned subsidiary of the Company. In connection with theaccounting for the acquisition, the Company has applied the purchase method as described below.
(i) The outline of the business combination to which the purchase method was applieda. Acquired company
Philadelphia Consolidated Holding Corp.
b. Business
A holding company for subsidiaries operating insurance and insurance-related businesses
c. Reasons for the business combination
The Company intends to strengthen its operational platform for local commercial businesses in
the U.S. and expand its overall insurance business in the U.S. insurance market.
d. Date of the business combination
December 1, 2008
e. Form of the business combination
Reverse triangular merger under business combination laws in the U.S.
f. Ratio of voting rights acquired through the business combination
100%(ii) Period for which the operating results of the acquired company are included in the
consolidated statement of income of the Company
For accounting purposes, the business combination date is deemed to be the last day of
PHLY’s fiscal year ended December 31, 2008. Consequently, the results of operation of theacquired company are not reflected in the consolidated statement of income of the Company
for the fiscal year ended March 31, 2009.
(iii) Acquisition cost
473,537 million yen(iv) Amount, basis, amortization method and amortization period of goodwill
a. Amount of goodwill
253,611 million yen
b. Basis
The acquisition cost of the acquired company, which was calculated by taking into accountthe projected future revenues as of the valuation date, exceeded the market value of the net
assets of the acquired company as of the date of the business combination. This difference
was recognized as goodwill.
c. Method and period of amortization
To be amortized over 20 years using the straight-line method(v) Assets and liabilities assumed on the date of the business combination and their main
components

43

Item
Total assets(Securities included
in total assets)

Amount(million yen)
511,852(225,405)

Item
Total liabilities(Underwriting funds
included in total
liabilities)

Amount(million yen)
291,926(226,859)(vi) Approximate impact on the consolidated statement of income, assuming that the businesscombination took place on the first day of the fiscal year ended March 31, 2009
The ordinary income, ordinary profit and net income would have increased by approximately
166,851 million yen, 4,393 million yen and 143 million yen, respectively.
These amounts represent the difference between the actual figures on consolidated statementof income of the Company for the fiscal year ended March 31, 2009 and the hypotheticalamount of consolidated ordinary income, ordinary profit and net income, including PHLY's
figures, calculated assuming that the business combination was completed on the first day of
the fiscal year ended March 31, 2009. The amortized amount of goodwill was calculated
assuming that the entire goodwill for the acquisition recognized at the time of the businesscombination had arisen on the first day of the fiscal year ended March 31, 2009.
The above amounts are un-audited.

44

Non-consolidated Balance Sheet as of March 31, 2009
(Yen in millions)
As of March 31, 2009
AmountItem
AssetsI. Current assets
Cash and deposits
Securities
Prepaid expense
Deferred tax assets
Receivables
OthersII. Fixed assets
1 Tangible fixed assets
Buildings
Motor vehicles and transport equipment
Office equipment
2 Intangible fixed assets
Telephone right
3 Investments and other assets
Investments in subsidiaries and affiliates
Deferred tax assets
OthersTotal assets
Liabilities
I. Current liabilities
Accounts payable
Accrued expenses
Accrued income taxes
Accrued business office taxes
Accrued consumption tax
Deposits received
Reserve for bonus
II. Fixed liabilities
Long-term accounts payable
Reserve for retirement benefit
Total liabilities
Net assets:
I. Stockholders' equity
1 Common stock
2 Capital surplus(1) Additional paid-in capital(2) Others
3 Retained earnings(1) Other retained earnings
General reserve
Retained earnings carried forward
4 Treasury stock
II. Stock acquisition rights
III. Total net assets
Total liabilities and net assets

45

33,843
6,440
1,500
0
365
25,52982,496,489
271
212
8
50
0
0
2,496,216
2,496,015
197
3
2,530,333
1,598
314
111
684
8
99
11
366
224
57
167
1,822
2,527,661
150,000
1,598,086
1,511,485
86,600839,238
839,238
702,275
136,962-59,663849
2,528,510
2,530,333

Non-consolidated Statement of Income for the fiscal year ended March 31, 2009
(Yen in millions)Year ended March 31, 2009

Item
AmountOperating income:
Dividends received from subsidiaries and affiliates
Fees received from subsidiaries and affiliates
Total operating income

130,053
6,517
136,570

Operating expenses:
Operating and general administrative expenses

6,094

Total operating expenses

6,094

Operating profit

130,476

Non-operating income:Interest earned

35

Interest on securities

70

Commission earned

4

Rent received
Gains on lapsed dividend payment obligation

6

Other non-operating income

172

Total non-operating income

136

Non-operating expenses:
Transaction fee for repurchase of shares

15

Miscellaneous expenses

100

Other non-operating expense

1

Total non-operating expenses

118

Ordinary profit

130,494

Extraordinary gains:
Gains on sales of fixes assets

1

Total extraordinary gains

1

Extraordinary losses:
Losses on disposal of fixed assets

1

Impairment losses on investment in affiliates

11,824

Total extraordinary losses

11,825

Income before income taxes

118,670

Income taxes-current

1,751

Income taxes-deferred-278

Total income taxes

1,472

Net income

117,19746

Non-consolidated Statement of Changes in Stockholders' Equity
For the fiscal year ended March 31, 2009
(April 1, 2008 to March 31, 2009)(Yen in Millions)
Stockholders' equity
Retained earnings
Other retained earnings

Capital surplus
CommonStockEnding balance as of March 31, 2008

Additional
paid-in capital

150,000

Others1,511,485

86,738Generalreserve

Total

Treasury stock stockholders'
Retained
equityearnings carriedforward679,275

85,933-9,792

2,503,641

23,000-23,000-

Dividends-43,168-43,168

Net income

117,197

117,197

Changes during the fiscal year
General reserve

Repurchase of treasury stocks
Disposition of treasury stocks-138-50,302-50,302431

292

Net changes in items other thanstockholders' equity
Total changes during the fiscal year

-

-

-138

23,00051,029-49,871

24,020Ending balance as of March 31, 2009

150,000

1,511,485

86,600702,275

136,962-59,6632,527,661

StockacquisitionrightsEnding balance as of March 31, 2008

619

Total net
assets2,504,261

Changes during the fiscal year
General reserve-

Dividends-43,168

Net income

117,197

Repurchase of treasury stocks-50,302

Disposition of treasury stocks

292

Net changes in items other thanstockholders' equity

229

229

Total changes during the fiscal year229

24,249Ending balance as of March 31, 2009

849

2,528,510

47

Notes to Non-consolidated Financial Statements

Significant accounting policies
1. Valuation of securities(1) Investments in subsidiaries are stated at cost determined by the moving-average method.
(2) Other securities not with fair value are stated at cost determined by the moving-averagemethod.
2. Depreciation for fixed assets
Depreciation of tangible fixed assets other than buildings (excluding auxiliary facilities attached
to buildings) is computed using the declining-balance method principally over the following
useful lives.
Equipment and furniture
Auxiliary facilities attached to buildings

3 to 15 years
8 to 18 years

3. Reserve(1) To provide for payment of bonuses to employees, the Company maintains a reserve for
employees’ bonuses based on the expected amount to be paid.
(2) To provide for employees’ retirement benefit payments, the Company maintains a reservefor employee's retirement benefits equal to the amount deemed to have incurred as of the end of
the fiscal year ended March 31, 2009.
4. Consumption taxes

Consumption taxes and local consumption taxes are accounted for by the tax-excluded method.

Notes to the non-consolidated balance sheet
1. Accumulated depreciation of tangible fixed assets:

214 million yen

2. Monetary claims against and debts owed to affiliates:
Monetary claims receivables
Debts payable

746 million yen
111 million yen

3. Debts payable to directors and corporate auditors:
Long-term debts payable

57 million yen

Notes to the non-consolidated statement of income48Volume of transactions with affiliates:
Operating transactions
Operating income
Operating expenses
Transactions other than operating transactions

136,570 million yen
1,016 million yen
4,613 million yen

Notes to the statement of changes in stockholders' equity
Class and number of treasury stock held by the Company as of March 31, 2009
Common stock
16,961,439 shares

Tax effect accounting
Major components of deferred tax assets
Deferred tax assets
Impairment losses on investment in affiliates 4,811 million yen
Accrued business taxes
166 million yen
Reserve for employee's bonuses
149 million yen
Reserve for retirement benefits
68 million yen
Stock acquisition rights
53 million yen
Others
125 million yen
Sub total
5,373 million yen
Valuation allowance-4,811 million yen
Total deferred tax assets
562 million yen
Net deferred tax assets
562 million yen
Per-share information
Net assets per share
Net income per share

3,209.47 yen
147.53 yen

49

Copy of Independent Auditor’s Report on Consolidated Financial Statements[English Translation]
Independent Auditor's Report
May 19, 2009
To the Board of Directors
Tokio Marine Holdings, Inc.
PricewaterhouseCoopers Aarata
Chikakuni Yoshida, CPA
Designated Partner and Engagement
Partner
Takashi Idesawa, CPA
Designated Partner and Engagement
Partner
Takaaki Ino, CPA
Designated Partner and Engagement
Partner
We have audited, in accordance with Article 444, paragraph 4 of the Companies Act of Japan,
the consolidated financial statements of Tokio Marine Holdings, Inc. (the "Company") for the
fiscal year that began on April 1, 2008 and ended on March 31, 2009. These financial statements
consist of a consolidated balance sheet, a consolidated statement of income, a consolidated
statement of changes in stockholders' equity and notes to consolidated financial statements.
These financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these consolidated financial statements based on our
audit as an independent auditor.
We conducted our audit in accordance with auditing standards generally accepted in Japan.
Those standards require that we obtain reasonable assurance about whether the consolidated
financial statements are free of material misstatement. An audit is performed on a test basis andincludes assessing the accounting principles used by management including how they areapplied and estimates made by management, as well as examining the overall presentation of
the consolidated financial statements. We believe that our audit provides a reasonable basis forour opinion.
In our opinion, the foregoing consolidated financial statements present fairly, in all material
respects, the financial position and the results of operations of the Company and its consolidated
subsidiaries for the period covered by the aforementioned financial statements in conformity
with accounting principles generally accepted in Japan.
(Additional information)
As noted in the “Changes in the basis of consolidated financial statements”, the Company has
adopted "Practical Solution on Unification of Accounting Policies Applied to Foreign
Subsidiaries for Consolidated Financial Statements" for the fiscal year ended March 31, 2009.
Our firm and engagement partners have no interests in the Company that is required to bedisclosed pursuant to the provisions of the Certified Public Accountants Law of Japan.

50

Copy of Independent Auditor’s Report on Non-consolidated Financial
Statements[English Translation]
Independent Auditor's Report
May 19, 2009
To the Board of Directors
Tokio Marine Holdings, Inc.
PricewaterhouseCoopers Aarata
Chikakuni Yoshida, CPA
Designated Partner and Engagement
Partner
Takashi Idesawa, CPA
Designated Partner and Engagement
Partner
Takaaki Ino, CPA
Designated Partner and Engagement
Partner
We have audited, in accordance with Article 436, paragraph 2, item 1 of the Companies Act ofJapan, the non-consolidated financial statements of Tokio Marine Holdings, Inc. (the"Company") for its 7th fiscal year, that began on April 1, 2008 and ended on March 31, 2009.
These financial statements consist of a non-consolidated balance sheet, a non-consolidated
statement of income, a non-consolidated statement of changes in stockholders' equity, notes tonon-consolidated financial statements and supplementary schedules. These financial statements
and supplementary schedules are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements and supplementaryschedules based on our audit as an independent auditor.
We conducted our audit in accordance with auditing standards generally accepted in Japan.
Those standards require that we obtain reasonable assurance about whether the financial
statements and supplementary schedules are free of material misstatement. An audit isperformed on a test basis and includes assessing the accounting principles used by management
including how they are applied and estimates made by management, as well as examining theoverall presentation of the financial statements and supplementary schedules. We believe that
our audit provides a reasonable basis for our opinion.
In our opinion, the foregoing non-consolidated financial statements and supplementaryschedules present fairly, in all material respects, the financial position and the results ofoperations of the Company for the period covered by the aforementioned financial statements
and supplementary schedules in conformity with accounting principles generally accepted inJapan.
Our firm and engagement partners have no interests in the Company that is required to bedisclosed pursuant to the provisions of the Certified Public Accountants Law of Japan.

51

Copy of the Audit Report of the Board of Corporate Auditors

Audit Report

Based on the audit reports received from each corporate auditor relating to the performance by
the Company's directors of their duties during the fiscal year that began on April 1, 2008 andended on March 31, 2009 and after consultations amongst our members, we, the undersigned
Board of Corporate Auditors, report as follows:
1. Details of the Methodology of the Audit Performed by Corporate Auditors
The Board of Corporate Auditors who has set the auditing policies, the auditing schedules andrelated matters, received from each corporate auditor audit reports detailing the performance ofeach corporate auditor in audits and the results thereof. The Board of Corporate Auditors also
received from each of the Company's directors and the Company's independent auditor reports
detailing the performance of their duties and asked for further explanation whenever necessary.
Each corporate auditor, pursuant to the auditing standards, the auditing policies and the auditingschedules set by the Board of Corporate Auditors, maintained good communications withdirectors, the internal audit department and other employees; committed themselves to gathering
information and improving the circumstances of the audit; attended meetings of the Board of
Directors and other important meetings; received reports detailing the performance of theirduties from directors and other employees; asked for further explanations whenever necessary
and inspected important decision-making documents and thereby investigated the Company's
business activities and financial position.
In addition, pursuant to the auditing standards set by the Board of Corporate Auditors for an
audit of the internal control system, each corporate auditor examined the details of theresolution of the meeting of the Board of Directors concerning (a) a governance framework toensure that the directors' performance of their duties are carried out in conformity with the laws
and the Articles of Incorporation; and (b) any other governance framework to ensure appropriate
business operations, as set forth in Article 100, paragraphs 1 and 3 of the Enforcement
Regulations of the Companies Act of Japan. Each of the corporate auditors also monitored andexamined the governance framework (internal control system) which was implemented by the
Board of Directors based on the aforementioned resolution. Concerning the internal control overfinancial reporting, each corporate auditor received from directors and PricewaterhouseCoopers
Aarata reports regarding the results of the assessment and audit on the internal control overfinancial reporting and asked for further explanations whenever necessary.
As for subsidiaries of the Company, each corporate auditor maintained good communications
and facilitated information sharing with directors, corporate auditors, the internal audit
department and other employees of the subsidiaries and received reports regarding the businessactivities of the subsidiaries whenever necessary.
We examined the business report included in this notice of convocation as well as the
supplementary schedules thereto for the fiscal year ended March 31, 2009 based on the
aforesaid methods of audit.

52

Furthermore, each corporate auditor monitored and examined whether the Company's
independent auditor maintained independence from the Company and performed the audit
adequately, received from the Company's independent auditor a report concerning theperformance of that auditor's duties and asked for further explanations whenever necessary.
Additionally, each corporate auditor received a notice from the Company's independent auditor
stating that "a framework to ensure that independent auditors' performance of duties are carriedout properly" (consisting of matters enumerated in the items of Article 131 of the Regulations
for Financial Statements of Corporations) is established pursuant to "Quality Management
Standards Regarding Audits" (Corporate Accounting Council, October 28, 2005) and addressing
other standards concerned, and asked for further explanations whenever necessary.
Based on the methodology of the audit described above, we examined the non-consolidated
financial statements (balance sheet, statement of income, statement of changes in stockholders'equity and notes thereto) and the supplementary schedules thereto, and the consolidated
financial statements (balance sheet, statement of income, statement of changes in stockholders'equity and notes thereto) for the fiscal year ended March 31, 2009.
2. Results of Audit(1) Results of the audit of the business report and others(a) We found the business report and the supplementary schedules to present fairly the state of theCompany in accordance with applicable laws and regulations and the Articles of Incorporation of theCompany.
(b) In connection with the performance by directors of their duties, we found no dishonest act orviolation of applicable laws, regulations or the Articles of Incorporation of the Company.
(c) We found the resolution of the meeting of the Board of Directors with respect to the internal
control system to be appropriate. In addition, we have nothing to report on the directors'
performance of their duties in connection with the internal control system, including the internal
control over the financial reporting.

(2) Results of the audit of the non-consolidated financial statements and the supplementaryschedules thereto
We found the methodologies and the results of the audit conducted by the independent auditors,
PricewaterhouseCoopers Aarata, to be appropriate.
(3) Results of the audit of the consolidated financial statement
We found the methodologies and the results of the audit conducted by the independent auditors,
PricewaterhouseCoopers Aarata, to be appropriate.

May 19, 2009
Board of Corporate Auditors,
Tokio Marine Holdings, Inc.
Yasuo Yaoita, Standing Corporate Auditor
Tetsuo Kamioka, Standing Corporate Auditor

53

Shigemitsu Miki, Corporate Auditor
Hiroshi Fukuda, Corporate Auditor
Yuko Kawamoto, Corporate Auditor
Note: Mr. Shigemitsu Miki, Mr. Hiroshi Fukuda and Ms. Yuko Kawamoto are the outside
corporate auditors, fulfilling the position prescribed by Article 2, item 16 of the Companies
Act of Japan.

54