[English Translation]
TOKIO MARINE HOLDINGS, INC.

Attachment to the “Notice of Convocation of
the 10th Ordinary General Meeting of Shareholders”
Business Report for the Fiscal Year Ended March 31, 2012
(From April 1, 2011 to March 31, 2012)
1. Matters Concerning the Insurance Holding Company(1) Business Developments and Results for Tokio Marine Group
During the fiscal year ended March 31, 2012, higher capital and consumer spending andother positive factors contributed to a gradual recovery in the U.S. economy, whereas European
economies weakened owing to sovereign debt problems, the most prominent being those of Greece.
In developing nations economic growth slowed as a result of tighter monetary policies and otherfactors.

In Japan, the economy gradually improved despite the presence of negative factors suchas the effects of the Great East Japan Earthquake, supply-chain disruptions resulting from theearthquake and the strength of the yen against other currencies.

In the property and casualty

insurance sector, even enough domestic sales of new cars gradually increased, the challenging
business environment persisted owing to auto insurance loss ratios, which were at high levels, andlarge-scale natural disasters in and outside Japan.

In the life insurance sector, Japan’s

demographics – a declining birthrate and an aging population – and other factors led to acontinued decline in the amount of life insurance-in-force.

Against this backdrop, and in the final year of its “Innovation and Execution 2011”
medium-term corporate strategy, Tokio Marine Group (the “Group”) is working to achievesustainable earnings growth based on quality improvements in our products, services and businessprocesses.

During the fiscal year ended March 31, 2012, the Group strove to improve its growthpotential and the profitability of its domestic property and casualty insurance business, and to
expand its domestic life insurance business and overseas insurance business.

In order to further

develop a management and administration system that maximizes the Group’s global
competitiveness, the Group advanced initiatives aimed at enhancing its risk-based management (or“ERM”, Enterprise Risk Management) to better balance its levels of capital and risk and to12

improve capital efficiency while maintaining a sound financial base.

The Group assigned approximately 10,000 employees, working together with our agents,
to the task of making timely and appropriate claim payments to help restore as quickly as possible
the livelihoods of customers and business operations affected by the Great East Japan Earthquake.
Through the end of March 2012, we processed more than 200,000 claims.

We continue toreceive claims related to the disaster and are committed to fulfilling our social responsibilities as
an insurance group by properly paying every last such claim.

An increase in the Group’s ordinary income due to improved sales of insurance was
mitigated by the effects of Typhoons Nos. 12 and 15, floods in Thailand and other large-scale
natural disasters, as well as by a reduction in the corporate income tax rate which resulted in a
64.5-billion-yen reversal of deferred tax assets.

As a result, Tokio Marine Holdings reported

consolidated business results as described below.

(Yen in billions, except for %)DifferenceYear ended March 31, 2011

Year ended March 31, 2012

Ordinary income

3,288.6

3,415.9

103.9

Underwriting income

2,874.0

2,978.1

103.6

Investment income

347.7

372.9

107.2

Ordinary profit

126.5

160.3

126.7

Net income

71.9

6.0

8.3

(%)

Ordinary income and ordinary profit for each business segment are as follows:(Yen in billions)
Ordinary income
Business segment

Ordinary profit

Year ended

Year ended

Year ended

Year ended

March 31, 2011

March 31, 2012

March 31, 2011

March 31, 2012

2,425.7

2,663.3

104.5

205.7

442.2

430.2

7.1

7.5

Overseas insurance

539.9

530.2

14.4

-54.6

Financial and other

70.8

69.1

2.0

1.7

Domestic property
and casualty
insurance
Domestic life
insurance

13

Domestic Property and Casualty Insurance Business
The following is a discussion of Tokio Marine and Nichido Fire Insurance Co., Ltd.’s(“Tokio Marine & Nichido”) operating results for the fiscal year ended March 31, 2012.
premiums written were 1,783.0 billion yen, a year-on-year increase of 2.3 percent.

Net

Despite theoccurrence of floods in Thailand, typhoons and other natural disasters in the fiscal year ended
March 31, 2012, ordinary profit increased 66.3 billion yen as compared to the previous fiscal year
to 212.1 billion yen because of the reversal of the catastrophe reserves and other factors.

Net

income was 23.2 billion yen, a decrease of 77.5 billion yen as compared to the previous fiscal year,
due to the reversal of deferred tax assets associated with the lowering of the corporate income tax
rate.

Tokio Marine & Nichido has been promoting sales of its all-in-one life and property andcasualty product, Super Insurance, which offers a total coverage package appropriate to acustomer’s life plans, family composition and other factors.

In March 2012, the number ofpolicyholder households of Super Insurance surpassed 1.3 million.

In October 2011, Tokio Marine & Nichido launched the industry’s first One-day Auto
Insurance, which can be purchased at any time via mobile phone.

This new type of auto

insurance can be purchased for 500 or 1,000 yen per day for just the number of days needed.
With this new product, Tokio Marine & Nichido aims to help reduce the number of accidents
involving uninsured drivers, in particular by increasing the percentage of insured young drivers,
which should help auto accident victims obtain better care.

Tokio Marine & Nichido also started sales of Lump-sum Payment Rider For Auto
Insurance in Case of Total Vehicle Loss From an Earthquake, Volcano or Tsunami, which wasdeveloped based on experience gained in relation to the Great East Japan Earthquake.

The rider

is intended to provide a set amount towards the purchase of a replacement vehicle in the event of a
total vehicle loss due to an earthquake, volcano or tsunami.

To strengthen its sales base, Tokio Marine & Nichido entered into an agency service
agreement with Meiji Yasuda Life Insurance Company (“Meiji Yasuda”) and since January 2012its auto insurance and other policies have been sold through Meiji Yasuda.

In relation to asset management, Tokio Marine & Nichido aimed to ensure stableearnings and asset liquidity as part of its efforts to maintain a sound financial base through risk

14

management.

With respect to the operating results of Nisshin Fire & Marine Insurance Co., Ltd.
(“Nisshin Fire”) for the fiscal year ended March 31, 2012, net premiums written were 136.6 billion
yen, representing an increase of 1.9 percent from the previous fiscal year.

Ordinary profit was

4.2 billion yen, an increase of 1.6 billion yen as compared to the previous fiscal year, and net loss
was 4.7 billion yen, a decrease of 6.2 billion yen from the previous fiscal year’s net profit.

Domestic Life Insurance Business

As of March 31, 2012, Tokio Marine & Nichido Life Insurance Co., Ltd. (“Tokio Marine& Nichido Life”) had 419.4 billion yen in annualized premiums of life insurance-in-force, ayear-on-year increase of 5.7 percent, while the annualized premiums of newly signed life
insurance were 57.3 billion yen, a year-on-year increase of 12.9 percent.

We achieved theseincreases by strengthening the integration of life and non-life insurance through sales of Super
Insurance, new product launches and other efforts.

Ordinary profit was 26.9 billion yen, an

increase of 7.5 billion yen, and net income was 6.8 billion yen, an increase of 1.5 billion yen, eachcompared to the previous fiscal year.

In August 2011, Tokio Marine & Nichido Life launched Medical Kit, a medical
insurance product to cover inability-to-work risks, which recorded strong sales.

Tokio Marine &Nichido Life also started selling Medical Kit Love, a medical insurance product with underwriting
standards designed for customers with recurring medical problems as demonstrated by a history of
hospitalization and chronic diseases.

Tokio Marine & Nichido Financial Life Insurance Co., Ltd. (“Tokio Marine & Nichido
Financial Life”) specialized in the sales of variable annuities insurance, however, after careful
review of the business environment, in March 2012 it announced a suspension of new sales of all
insurance products.

As of March 31, 2012, Tokio Marine & Nichido Financial Life had 2,706.7

billion yen in life insurance-in-force and 13.1 billion yen in newly signed life insurance.
Ordinary loss was 14.9 billion yen, and net loss was 15.1 billion yen.

Overseas Insurance Business

The Group actively developed its international insurance business with the aim of global
growth and risk diversification.

15

Even though the overall U.S. property and casualty insurance market was characterized
by slow growth, PHLY, a U.S. property and casualty insurance group, was able to maintain astrong performance by focusing on specific industry sectors and customer segments.

As a result,

PHLY’s amount of net premiums written was 2.0 billion U.S. dollars (158.1 billion yen), a 3.1
percent increase compared to the previous fiscal year.

Kiln, a U.K. insurance group, increased its

underwriting amid an upward trend in premium rates for natural catastrophe-related insurance,
owing to a greater occurrence of natural disasters.

As a result, Kiln’s net premiums written

during the fiscal year 2011 were 460 million British pounds (55.3 billion yen), an increase of 5.5
percent compared to the previous fiscal year.

Tokio Millennium Re Limited, a reinsurancecompany, recorded a 28.6 percent year-on-year increase in net premiums written to 530 million
U.S. dollars (41.8 billion yen) for the fiscal year 2011.

Nevertheless, the Company’s overseas

insurance business as a whole recorded a loss due to multiple, severe natural disasters, such as
floods in Australia and Thailand and tornados in the United States.

In order to achieve further business growth in the United States, the largest insurance
market in the world, the Company in June 2011 established Tokio Marine North America, Inc., asa holding company for the Group’s U.S. operations.

The Company also made First Insurance

Company of Hawaii, Ltd. (“FICOH”), the oldest property and casualty insurance company inHawaii, a wholly owned subsidiary in November 2011.

In addition, the Company entered into a

definitive agreement with Delphi under which the Company acquired all outstanding shares ofDelphi, a promising and profitable financial services holding company comprised of specialty lifeand property and casualty insurance businesses.

We believe that Delphi has a competitive edgein employee benefit-related insurance and limits its underwriting of natural disaster risks, and so
the acquisition should contribute to the Group’s risk diversification.

In emerging markets, Edelweiss Tokio Life Insurance Company Limited, a joint venture
established in India by the Group and a leading financial services company in India, commenced
operations in July 2011.

The Tokio Marine and Nichido Fire Insurance Company (China)

Limited aims to expand business in China and opened the Jiangsu Branch in August 2011, and ispreparing to open its fourth branch in mainland China, in Beijing.

Financial and Other Business

16

The Group developed its financial services business, with a focus on fee-based asset
management business offering a stable base of revenue.

Fee-based business includes

management of public and corporate pension funds and the establishment and management ofinvestment trusts by Tokio Marine Asset Management Co., Ltd.

As to its general business, theGroup continued to engage in temporary staffing services, property management services andother business.

CSR

Tokio Marine & Nichido achieved Carbon Neutral status by promoting a Green Giftproject whereby Tokio Marine & Nichido contributes funds for mangrove-planting activities by
NGOs based on the number of policies for which customers choose to receive the terms andconditions on the Company’s website.

Tokio Marine & Nichido also supports the restoration ofcoastal forests in the Tohoku Region, which were severely damaged by the tsunami caused by theGreat East Japan Earthquake.

Thanks to its global environment protection initiatives, theCompany in March 2012 was recognized by a U.S. business ethics think-tank as one of “2012World’s Most Ethical Companies”.

Issues Facing the GroupIn the fiscal year ending March 31, 2013, we expect the U.S. economy to gradually
improve but European economies to further decline due to persisting sovereign debt problems.
We expect continued growth by some emerging countries, albeit at a slower pace.

The Japanese economy is likely to continue to recover due to the boost in reconstruction
projects following the Great East Japan Earthquake, and we expect monetary easing to have someeffect.

For the domestic insurance market, improved sales of new cars and other factors are

expected to contribute to market expansion, however, market prospects remains uncertain owing to
the effects of the declining birthrate and aging population, as well as population decline.

In this challenging environment, Tokio Marine Group will focus on the issues described
below.

In the fiscal year 2012, Tokio Marine Group launched Innovation and Execution 2014, a
new medium-term business strategy with the vision of becoming a “global insurance group
maintaining growth by offering quality that customers select”.

17Through this business strategy, we will pursue industry-leading growth while striving to
improve the profitability of our mainstay domestic property and casualty insurance business.

In

the domestic life insurance business, we will target sustainable growth by introducing new
products, advancing our integration of life and non-life insurance and other efforts.

In theoverseas insurance business, the Group will work for a successful management integration with
Delphi, while expanding the scale and earnings of its subsidiaries and affiliates in developed andemerging countries.

The Group aims to further enhance its risk-based management (through an ERM system)by strengthening risk management related to natural disasters, continued sale of equities held forbusiness-relationship-related reasons, investing in high-margin businesses and other measures.
Through these efforts, we intend to maintain the Group’s strength of financial soundness, while
enhancing our efforts for sustained profit growth and improved capital efficiency.

The Group intends to improve shareholder returns by distributing steadily growing
dividends and other measures and will seek to increase dividends by improving profitability.

Under our 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 corporategroup, seeking growth characterized by high profitability, sustainability and soundness.

Themanagement 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 truncatedand all ratios are rounded to one decimal place.

Note 2:

Numbers that appear as ordinary income and ordinary profit for each business segment are
before adjustments made to record ordinary income and ordinary profit in the consolidated
statement of income.

Note 3:“Annualized premiums” is calculated by dividing the total amount of premiums received
throughout the policy period by the policy period, resulting in an amount of premiums per
year.

Note 4:“PHLY” means the corporate group comprised of Philadelphia Consolidated Holding
Corporation and its subsidiaries.

“Kiln” means the corporate group comprised of Kiln

Group Limited and its subsidiaries.

In addition, “Delphi” means the corporate group

comprised of Delphi Financial Group Inc. and its subsidiaries.

18

Note 5:The yen-denominated amounts of net premiums written of PHLY, Kiln, and Tokio
Millennium Re Limited are calculated at exchange rates in effect as of the end of December
2011.

Note 6:“Carbon Neutral” is when the carbon dioxide absorbed or reduced by the planting ofmangroves and our other initiatives is calculated to be equal to the amount of the carbon
dioxide discharged through our business operations.

19

(2) Four Year Summary of Assets and Earnings of the Group and the Insurance Holding
Companya. The Group's summary of assets and earnings(Yen in millions)(Fiscal years ended March 31)
2009
2010
2011
2012
Ordinary income
3,503,102
3,570,803
3,288,605
3,415,984
Ordinary profit-15,128
203,413
126,587
160,324
Net income
23,141
128,418
71,924
6,001
Comprehensive income-196,554-10,558
Net assets
1,639,514
2,184,795
1,904,477
1,857,465
Total assets
15,247,223
17,265,868
16,528,644
16,338,460
Note: As of the fiscal year ended March 31, 2011, the Company calculates comprehensive income
pursuant to “Accounting Standard for Presentation of Comprehensive Income” (ASBJ Statement
No. 25, June 30, 2010).

b. The Insurance Holding Company's summary of assets and earnings(Yen in millions, except per share amounts)(Fiscal years ended March 31)
2009
2010
2011
2012
Operating income
136,570
32,324
127,806
83,955
Dividends received
130,053
25,617
120,892
77,872
Insurance subsidiaries
129,134
25,082
120,156
76,017
Other subsidiaries
919
535
735
1,854
Net income
117,19744
80,226
62,110Net income per share of common
147.530.05
103.16
80.98
share
yen
yen
yen
yen
Total assets
2,530,333
2,492,379
2,482,926
2,506,933
Share of insurance subsidiaries
2,427,769
2,416,206
2,380,355
2,412,091
Share of other subsidiaries
68,24661,43662,45771,558(3) The Group's Principal Offices (As of March 31, 2012)
a. The Company
Location
Head Office2-1, Marunouchi 1-chome, Chiyoda-ku, Tokyo, Japan

Established as ofApril 2, 2002

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

b. Subsidiaries and affiliates
Business
Company
segment
nameTokio Marine
Domestic& Nichido
property andcasualty
insurance

Office nameLocation

Head Office
Hokkaido
Hokkaido
Branch and 6other branches
TohokuSendai Branch
and 9 otherbranches
Kanto
Tokyo Central
Branch and 32
other branches
Tokai andAichi South
Hokuriku
Branch and 24
other branches

2-1,
Marunouchi 1chome,
Chiyoda-ku,
Tokyo, Japan20

Established
as ofMarch 20,1944

Kansai

Nisshin Fire

Domestic life
insurance

Overseas
insurance

Financial andotherTokio Marine& Nichido
Life
Tokio Marine& Nichido
Financial
Life
Philadelphia
Consolidated
Holding
Corp.
Kiln Group
Limited
Tokio Marine
Financial
Solutions
Ltd.

Osaka South
Branch and 24
other branches
Chugoku
HiroshimaandBranch and 14
Shikokuother branches
KyushuFukuoka
Central Branchand 13 otherbranches
Head Office (Tokyo Head
Office), Saitama Head Office

Head Office

Head Office

Head Office3,
Kandasurugadai
2-chome,
Chiyoda-ku,
Tokyo
3-16, Ginza 5chome, Chuoku, Tokyo
1-1, Osaki 2chome,
Shinagawa-ku,
Tokyo
Bala Cynwyd,
Pennsylvania,
U.S.A.

Head OfficeLondon, U.K.

Head OfficeGeorge Town,
Cayman Islands

June 10,1908

August 6,
1996
August 13,
1996

July 6,
1981

July 11,1994
December4, 1997

Notes 1. This table sets forth major subsidiaries and affiliates accounted for by the equity method.
2. "Office name" is the name of the principal office.
3. "Location" is the location of the head office.
4. The dates shown above are the date of incorporation.

(4) The Group's Employees

Business segment
Domestic property andcasualty insurance
Domestic life insurance
Overseas insurance
Financial and other
Total

As of March 31,
2011

As of March 31,
2012

19,900
2,409
5,902
1,547
29,75820,381
2,358
6,573
1,519
30,831

21

Increase(decrease)
481
(51)
671
(28)
1,073

(5) The Group's Principal Lenders (As of March 31, 2012)
Business segment
Domestic property andcasualty insurance

Company name
Tokio Marine & Nichido

LenderSyndicated loan

Balance of loan
170,000 million yen

Note: The arranger of the syndicated loan is The Bank of Tokyo-Mitsubishi UFJ, Ltd.

(6) The Group's Financing Activities
In order to partially refinance loans in its property and casualty insurance business, Tokio
Marine & Nichido raised 70,000 million yen through a syndicated loan arranged by The Bankof Tokyo-Mitsubishi UFJ, Ltd. In addition, in order to finance the acquisition of Delphi,
Tokio Marine & Nichido raised 100,000 million yen through a syndicated loan arranged by
The Bank of Tokyo-Mitsubishi UFJ, Ltd.
(7) The Group's Capital Investment Activities
a. Total investment in facilities
Business segment
Domestic property andcasualty insurance
Domestic life insurance
Overseas insurance
Financial and other
Total

Amount
9,494 million yen
394 million yen
2,165 million yen
8,427 million yen
20,481 million yen

Notes 1. "Amount" is the aggregate amount of investment in facilities for the year ended March 31,
2012.
2. Yen amounts include certain capital expenditures in other currencies which were converted
into yen based on exchange rates as of the closing date of the fiscal year of the Company.

b. New construction of major facilities and otherNone.
(8) Parent Company and Major Subsidiaries (As of March 31, 2012)
a. Parent company
None.
b. Major subsidiaries and affiliates accounted for by the equity method
Ratio ofCompany nameLocation

Major business

Paid-in Tokio
Date ofcapital Marine
Notes
incorporation (Yen in Holdings'
millions) voting
rightsTokio Marine & Nichido
Fire Insurance Co., Ltd.

Tokyo, Japan

Property andcasualty
insurance

Mar. 20, 1944

101,994 100.0%-

Nisshin Fire & Marine
Insurance Co., Ltd.

Tokyo, Japan

Property andcasualty
insurance

June 10, 1908

20,389 100.0%-

22Tokio Marine & Nichido
Life Insurance Co., Ltd.

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

68,000 100.0%-

Tokio Marine Millea SAST
Insurance Co., Ltd.

Kanagawa,
Japan

Small-amountshort-term
insurance

Sept. 1, 2003

1,595 100.0%-

Tokio Marine North
America, Inc.

Wilmington,
Delaware,
U.S.A.

Holding company June 29, 2011

0 100.0%(100.0)-Philadelphia Consolidated
Holding Corp.

Holding company July 6, 1981
Bala
Cynwyd,Pennsylvania,
U.S.A.

0 100.0%(100.0)-Philadelphia Indemnity
Insurance Company

Property andBalacasualty
Cynwyd,insurance
Pennsylvania,
U.S.A .

Feb. 4, 1927

295 100.0%(100.0)-First Insurance Company
of Hawaii, Ltd.

Honolulu,
Hawaii,U.S.A.

Aug. 6, 1982

351 100.0%(100.0)-Kiln Group Limited

London, U.K. Holding company July 11, 1994

131 100.0%(100.0)-Kiln Underwriting Limited

London, U.K. Property andcasualty
insurance

June 13, 1994

0 100.0%(100.0)-

Tokio Millennium Re (UK)
LimitedLondon, U.K. Property andcasualty
insurance

Oct. 30, 1990

16,417 100.0%(100.0)-

Tokio Marine Underwriting London, U.K. Property and
Limitedcasualty
insurance

Oct. 27, 2008

0 100.0%(100.0)-

Tokio Marine Bluebell Re
LimitedMar. 8, 2007

14,000 100.0%-

Tokio Marine Asia Pte. Ltd. Singapore,
Singapore

Holding company Mar. 12, 1992

38,166 100.0%-

Asia General Holdings
Limited

Holding company Feb. 24, 1971

4,902

-

Douglas,Isle of Man

Singapore,
Singapore

Property andcasualty
insurance

Life insurance

23

92.4%
(92.4)

Tokio Marine Insurance
Singapore Ltd.

Singapore,
Singapore

Property andcasualty
insurance

July 11, 1923

6,537 100.0%(100.0)-

Tokio Marine Life
Insurance Singapore Ltd.

Singapore,
SingaporeLife insurance

May 21, 1948

2,353

85.7%
(85.7)-

Tokio Marine Life
Insurance Malaysia Bhd.

Kuala
Lumpur,MalaysiaLife insurance

Feb. 11, 1998

2,681 100.0%(100.0)-

Edelweiss Tokio Life
Insurance Company
LimitedMumbai,
India

Life insurance

Nov. 25, 2009

2,423

26.0%
(26.0)-

Tokio Marine Seguradora
S.A.

Sao Paulo,
BrazilProperty andcasualty
insurance

June 23, 1937

12,253 100.0%-

Tokio Millennium Re Ltd.

Hamilton,
BermudaProperty andcasualty
insurance

Mar. 15, 2000

20,547 100.0%(100.0)-George Town, Derivatives
Dec. 4, 1997
1,767 100.0%
Caymanbusiness(100.0)Islands
Notes: 1. This table sets forth major subsidiaries and affiliates accounted for by the equity method.

-

Tokio Marine Financial
Solutions Ltd.

2. Tokio Marine North America, Inc. is included in the table due to an increase in importance.
3. Edelweiss Tokio Life Insurance Company Limited is included in the table due to an increasein importance.
4. 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.
5. Figures in brackets shown under Tokio Marine Holdings's voting rights reflect Tokio Marine
Holdings's indirectly held ownership ratio in the respective subsidiary.

(9) The Group's acquisition and transfer of business
Date of thetransactions
November 29, 2011

Outline of transaction
On November 29, 2011, Tokio Marine & Nichido, a property andcasualty insurance company, acquired 50% of the outstanding sharesof FICOH owned by a major U.S. insurance group. The acquisition
price was 165 million U.S. dollars (approximately 12.7 billion yen).
Tokio Marine & Nichido had owned 50% of FICOH's outstanding
shares prior to the acquisition and made FICOH its wholly owned
subsidiary as a result of the acquisition. Details of the company
acquired and the purpose of the acquisition are as follows.
- Company acquired
Company name: First Insurance Company of Hawaii, Ltd.
24

Head office: Honolulu, Hawaii, U.S.A.
Business lines: Property and casualty insurance business- Purpose of the acquisition
The Company seeks to increase the scale of its insurance
business and earnings in the largest insurance market in theworld, the United States.
(10) Other Important Matters Concerning the Current State of the GroupNone.

2. Matters Concerning Directors and Corporate Auditors(1) Directors and corporate auditors (As of March 31, 2012)
Name
Kunio Ishihara

Position and assigned
dutiesDirector and Chairman of
the Board

Shuzo Sumi

Representative Director
and President

Hiroshi Amemiya

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 Daiichi Sankyo Company, Limited(outside director)
Vice Chairman of Japan Association of Corporate
Executives
Representative Director and President of Tokio
Marine & Nichido
Chairman of the General Insurance Association ofJapan

In charge of Domestic
Business Development
Dept., Corporate Planning
Dept. and Legal Dept.
Takaaki Tamai

Senior Managing Director of Tokio Marine &NichidoRepresentative Director
and Senior Managing
Director
In charge of Corporate
Accounting Dept.,
Personnel Planning Dept.,
Internal Control Dept.,
Risk Management Dept.
and Internal Audit Dept.

Tsuyoshi Nagano

Representative Director
and Senior Managing
Director

Senior Managing Director of Tokio Marine &NichidoOverall supervision ofoverseas insurance25business; in charge ofInternational Business
Development Dept.
(management of North
America, Latin America,
European and Middle
Eastern regions andreinsurance operations)
Masashi Oba

Managing Director

Managing Director of Tokio Marine & Nichido

In charge of Financial
Planning Dept.
Hiroshi Miyajima

Director

Representative Director and President of Nisshin
Fire

Kunio Ito

Director(outside director)

Professor, Graduate School of Commerce andManagement, Hitotsubashi University
Director of Sharp Corporation (outside director)
Director of Mitsubishi Corporation (outside director)
Director of Akebono Brake Industry Co., Ltd.
(outside director)

Akio Mimura

Director(outside director)

Representative Director and Chairman of Nippon
Steel Corporation
Director of Development Bank of Japan Inc.
(outside director)
Director of the Innovation Network Corporation ofJapan (outside director)
Director of Nisshin Seifun Group Inc. (outside
director)

Toshifumi Kitazawa

Director

Representative Director and President of Tokio
Marine & Nichido Life

Mikio Sasaki

Director(outside director)

Senior Corporate Advisor of Mitsubishi Corporation
Director of Mitsubishi Motors Corporation (outside
director)
Director of Mitsubishi Electric Corporation(outside director)
Director of Mitsubishi Research Institute, Inc.
(outside director)

Toshiro Yagi

Standing Corporate
AuditorToshiki Ohashi

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

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 ITOCHU Corporation (outside director)
Director of Yamaha Motor Co., Ltd. (outside26

director)
Director of Monex Group, Inc. (outside director)
Director of Osaka Securities Exchange Co., Ltd.
(outside director)
Akinari Horii

Corporate Auditor(outside corporate auditor)

Director and Special Advisor of The Canon Institutefor Global Studies

Tetsuo Kamioka

Standing Corporate
AuditorResigned effective as of June 27, 2011

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. Mr. Kunio Ishihara retired from his position as Vice Chairman of Japan Association of
Corporate Executives effective as of April 26, 2012.
3. Dr. Kunio Ito, Mr. Akio Mimura, Mr. Mikio Sasaki, Mr. Hiroshi Fukuda, Ms. Yuko
Kawamoto and Mr. Akinari Horii are “independent directors/auditors” as specified by the
Tokyo Stock Exchange, Inc. and other stock exchanges in Japan.

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

Directors

Number of persons to receive
remuneration and other compensation
14 persons

Remuneration and other compensation
256 million yen

Corporate
Auditors

7 persons99 million yen

Total

21 persons

356 million yen

Notes 1: “Number of persons to receive remuneration and other compensation” includes three
directors and two corporate auditors who retired from office at the close of the 9th ordinary
general meeting of shareholders held on June 27, 2011.
2: “Remuneration and other compensation” includes the amounts paid to the three directors andtwo corporate auditors referred to in “Note 1” above.
3: Remuneration in connection with share acquisition rights is described below. Shareacquisition rights as a form of compensation for corporate auditors were abolished at the 9th
ordinary general meeting of shareholders held on June 27, 2011. The 3 million yen
described as paid to corporate auditors are the expenses incurred in the fiscal year ended
March 31, 2012 related to rights that were granted prior to the abolition of such compensation
for the corporate auditors.
Directors:
46 million yen
Corporate Auditors: 3 million yen
Total:
50 million yen
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 share acquisition rights: 70 million yen per year
Corporate
Auditors

Monthly remuneration: 12 million yen per month27

TotalMonthly remuneration: 37 million yen per month
Remuneration in connection with share acquisition rights: 70 million yen per year

3. Matters Concerning Outside Directors and Outside Corporate Auditors(1) Other Assignments (As of March 31, 2012)
Name

Other assignments

Kunio Ito(outside director)

Director of Sharp Corporation (outside director)
Director of Mitsubishi Corporation (outside director)
Director of Akebono Brake Industry Co., Ltd. (outside director)

Akio Mimura(outside director)

Representative Director and Chairman of Nippon Steel Corporation
Director of Development Bank of Japan Inc. (outside director)
Director of the Innovation Network Corporation of Japan (outside director)
Director of Nisshin Seifun Group Inc. (outside director)

Mikio Sasaki(outside director)

Director of Mitsubishi Motors Corporation (outside director)
Director of Mitsubishi Electric Corporation (outside director)
Director of Mitsubishi Research Institute, Inc. (outside director)

Yuko Kawamoto(outside corporate
auditor)Director of ITOCHU Corporation (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. The Company has listed its shares on Osaka Securities Exchange Co., Ltd.
3. Insurance subsidiaries of the Company conduct considerable amounts of insurance-relatedtransactions with Sharp Corporation, Mitsubishi Corporation, Nippon Steel Corporation,
Nisshin Seifun Group Inc., Mitsubishi Motors Corporation, Mitsubishi Electric Corporation
and ITOCHU Corporation and their subsidiaries.

(2) Principal Activities
Current term
Name
in officeKunio Ito(outside director)

Akio Mimura(outside director)

Mikio Sasaki

Attendance of board
meetings etc.

Major activities including theremarks made at board meetings etc.

2 year and 9monthsAttended 10 of the 11 boardof directors' meetings held
during the fiscal year ended
March 31, 2012.

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

1 year and 9monthsAttended 8 of the 11 boardof directors' meetings held
during the fiscal year ended
March 31, 2012.

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.

9 months

After assuming the

He has fulfilled his supervisory28

position, attended all 9board of directors' meetings
held during the fiscal year
ended March 31, 2012.

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.

5 year and 9monthsAttended all 11 board of
directors' meetings and all
11 board of corporate
auditors' meetings held
during the fiscal year ended
March 31, 2012.

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.

5 year and 9monthsAttended 10 of the 11 boardof directors' meetings and
10 of the 11 board ofcorporate auditors' meetings
held during the fiscal year
ended March 31, 2012.

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)

Hiroshi Fukuda(outside corporate
auditor)

Yuko Kawamoto(outside corporate
auditor)Akinari Horii

9 months

After assuming the
He has fulfilled his audit functions
position, attended all 9
by asking for detailed explanations(outside corporateboard of directors' meetings and making remarks on a timely
auditor)and all 9 board of corporate basis, based on his insight acquired
auditors' meetings held
through many years of experience induring the fiscal year ended his role as an executive or a regular
March 31, 2012.
employee of Bank of Japan.
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, 2012.
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. All of the 11 board of directors' meetings held during the fiscal year ended March 31, 2012were ordinary meetings. All of the 11 board of corporate auditors' meetings held during the
fiscal year ended March 31, 2012 were ordinary meetings.

(3) Limitation of Liability
Name

Outline of the contract to limit liability

Kunio Ito (outside director)
Akio Mimura (outside director)
Mikio Sasaki (outside director)
Hiroshi Fukuda (outside corporate auditor)
Yuko Kawamoto (outside corporate auditor)
Akinari Horii (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
limitation of 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.

29

(4) Remuneration and Other Compensation
Number of persons toreceive remunerationand other compensation

Remuneration received
from the insurance
holding company

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

Total amount of
remuneration and
8 persons
52 million yen
othercompensation
Notes: 1. "Number of persons to receive remuneration and other compensation" includes one outside
director and one outside corporate auditor who retired from office at the close of the 9th
ordinary general meeting of shareholders held on June 27, 2011.
2. "Remuneration received from the insurance holding company" includes the amount paid to
one outside director and one outside corporate auditor referred to in "Note 1" above.
3. Of the "Remuneration received from the insurance holding company", remuneration inconnection with share acquisition rights was 5 million yen.
4. The breakdown of the remuneration is as follows.
- Outside directors: 4 persons, 25 million yen- Outside corporate auditors: 4 persons, 26 million yen(5) Comments of Outside Directors and Outside Corporate Auditors
None.

4. Matters Concerning Common Share(1) Number of Shares (As of March 31, 2012)
Total number of shares authorized to be issued: 3,300,000 thousand shares
Total number of the issued shares: 804,524 thousand shares (including 37,596 thousand
treasury shares)(2) Total Number of Shareholders (As of March 31, 2012)
94,13230

(3) Major shareholders (As of March 31, 2012)
Capital contribution
to the Company
Shareholders
Number ofshares held

Ratio ofshares held

thousand shares%

Japan Trustee Services Bank, Ltd. (Trust Account)

46,744

6.1

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

43,896

5.7

Meiji Yasuda Life Insurance Company

19,1792.5

SSBT OD05 OMNIBUS ACCOUNT-TREATY CLIENTS

18,202

2.4

The Bank of Tokyo-Mitsubishi UFJ, Ltd.

15,6952.0State Street Bank and Trust Company 505225

14,5591.9

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

14,074

1.8

Mellon Bank, N.A. as Agent for its Client Mellon Omnibus
US Pension

12,228

1.6

Moxley & Co. LLC

11,924

1.6

Tokai Nichido Employee Stock Ownership Plan

11,634

1.5

Notes: 1. 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 Ltd. are an asset entrusted
by Mitsubishi Heavy Industries, Ltd. for its retirement benefits trust.
2. Moxley & Co. LLC is the corporate nominee holder of common share deposited for the issuance of
ADRs.
3. The Company holds 37,596 thousand treasury shares but is not included in "Shareholders" column inthe table.
4. The ratio of shares held is calculated after deducting 37,596 thousand treasury shares held by theCompany.

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

39.6%
1.6%
7.8%
32.9%
18.2%

(The number of outstanding shares as of March 31, 2012: 804,524 thousand shares)31

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

Outline of the share acquisition rights

Directors(except outside
directors)

The July 2005 Share Acquisition Rights (a share option scheme
under a stock-linked compensation plan)- The number of the share acquisition rights held by:
Directors (except outside directors): 7
Outside directors: 0
Corporate Auditors: 1- Class and number of shares to be issued upon exercise of theshare acquisition rights: 4,000 common shares (500 shares shallbe issued upon exercise of each share acquisition right.)

Number of
persons holding
the shareacquisitionrights8 persons

The July 2006 Share Acquisition Rights (a share option scheme
under a stock-linked compensation plan)- The number of the share acquisition rights held by:
Directors (except outside directors): 4
Outside directors: 0
Corporate Auditors: 4- Class and number of shares to be issued upon exercise of theshare acquisition rights: 4,000 common shares (500 shares shallbe issued upon exercise of each share acquisition right.)
Outside Directors

Corporate Auditors

The July 2007 Share Acquisition Rights (a share option scheme
under a stock-linked compensation plan)- The number of the share acquisition rights held by:
Directors (except outside directors): 38
Outside directors: 0
Corporate Auditors: 29- Class and number of shares to be issued upon exercise of theshare acquisition rights: 6,700 common shares (100 shares shallbe issued upon exercise of each share acquisition right.)
The August 2008 Share Acquisition Rights (a share option
scheme under a stock-linked compensation plan)- The number of the share acquisition rights held by:
Directors (except outside directors): 33
Outside directors: 0
Corporate Auditors: 33- Class and number of shares to be issued upon exercise of theshare acquisition rights: 6,600 common shares (100 shares shallbe issued upon exercise of each share acquisition right.)
The July 2009 Share Acquisition Rights (a share option scheme
under a stock-linked compensation plan)- The number of the share acquisition rights held by:
Directors (except outside directors): 64
Outside directors:6
Corporate Auditors: 57- Class and number of shares to be issued upon exercise of theshare acquisition rights: 12,700 common shares (100 shares
32

3 persons

3 personsshall be issued upon exercise of each share acquisition right.)
The July 2010 Share Acquisition Rights (a share option scheme
under a stock-linked compensation plan)- The number of the share acquisition rights held by:
Directors (except outside directors): 120
Outside directors:14
Corporate Auditors: 42- Class and number of shares to be issued upon exercise of theshare acquisition rights: 17,600 common shares (100 sharesshall be issued upon exercise of each share acquisition right.)
The July 2011 Share Acquisition Rights (a share option scheme
under a stock-linked compensation plan)- The number of the share acquisition rights held by:
Directors (except outside directors): 182
Outside directors:21- Class and number of shares to be issued upon exercise of theshare acquisition rights: 20,300 common shares (100 sharesshall be issued upon exercise of each share acquisition right.)

Notes: 1. All share acquisition rights are issued by the Company pursuant to a stock-linked
compensation plan.
2. The July 2005 Share Acquisition Rights were issued with especially favorable terms todirectors (including non-members 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 share acquisition rights as of March 31, 2012 and the outline of the shareacquisition rights are as follows:- Status as of March 31, 2012
The number of the share acquisition rights: 41
Class and number of shares to be issued upon exercise of the share acquisition rights:
20,500 common shares (500 shares shall be issued upon exercise of each share acquisitionrights.)- Outline of the share acquisition rights
Issue price: Issued without receipt of monetary consideration
Amount to be paid upon the exercise of the share acquisition rights: 1 yen per share
Exercise period: 30 years from the allotment of the share acquisition rights
Conditions for the exercise of the share acquisition rights: Share 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.
3. Share acquisition rights issued from July 2006 through July 2011 were allotted to Directors
and Corporate Auditors to settle their cash remuneration claims against their respective
companies, pursuant to Article 238, paragraphs 1 and 2 and Article 240 of the Companies Act
of Japan. The status of the share acquisition rights as of March 31, 2012 and the outline of
the share acquisition rights are set forth in the table below.

33

Number ofshareacquisitionrights (asof March
31, 2012)

July 2006
Share
Acquisition
RightsJuly 2007
Share
Acquisition
RightsAugust2008 Share
Acquisition
RightsJuly 2009
Share
Acquisition
RightsJuly 2010
Share
Acquisition
RightsJuly 2011
Share
Acquisition
Rights38

Class andnumber ofshares to beissued upon
exercise of
the shareacquisitionrights (as ofMarch 31,2012)
19,000commonsharesAmountpayable atissuance

Amount to
be paid upon
the exerciseof the shareacquisitionrightsExerciseperiodConditions forthe exercise of
the shareacquisitionrights

30 yearsfrom theallotmentof theshare
acquisitionrightsShare
acquisitionrights held by
any of the"Directors andCorporate
Auditors" thathe/she received
in his/her
capacity as adirector(including a
non-member ofthe board) or a
corporate
auditor of therelevant entity
may only be
exercised after
he/she has
retired fromany position asa director(including a
non-member ofthe board) or
corporate
auditor of such
entity.

2,013,506
yen

262

26,200commonshares491,700
yen

620

62,000commonshares353,300
yen

1,447

144,700
commonshares237,600
yen

1,949

194,900
commonshares234,400
yen

2,221

222,100
commonshares219,500yen

1 yen pershare

4. Directors and corporate auditors of the Company who were also directors (including non-members of
the board) of the Company's major subsidiaries at the time of the issuance of the share acquisitionrights have been allotted share acquisition rights in their capacity as directors (including nonmembers of the board) of these companies. The number of such share acquisition rights held bydirectors (excluding outside directors) and corporate auditors of the Company as of March 31, 2012 isas follows.
The July 2005 Share Acquisition Rights: 28
The July 2006 Share Acquisition Rights: 18
The July 2007 Share Acquisition Rights: 89
The August 2008 Share Acquisition rights: 151
The July 2009 Share Acquisition rights: 289
The July 2010 Share Acquisition rights: 313
The July 2011 Share Acquisition rights: 22934

(2) Share Acquisition Rights Allotted to Employees, etc. during the Fiscal Year

Outline of the share acquisition rights

Number of
persons who
were allottedshare acquisitionrightsEmployees

The July 2011 Share Acquisition Rights (a share option scheme
under a stock-linked compensation plan)- The number of the share acquisition rights: 171- Class and number of shares to be issued upon exercise of theshare acquisition rights: 17,100 common shares (100 shares shallbe issued upon exercise of each share acquisition rights.)

7 persons

Directors, corporate
auditors andemployees ofsubsidiaries

The July 2011 Share Acquisition Rights (a share option scheme
under a stock-linked compensation plan)- The number of the share acquisition rights: 1,560- Class and number of shares to be issued upon exercise of theshare acquisition rights: 156,000 common shares (100 sharesshall be issued upon exercise of each share acquisition rights.)

53 persons

Notes: 1. All share acquisition rights are issued by the Company pursuant to a stock-linked
compensation plan.
2. The above table shows July 2011 Share Acquisition Rights allotted to employees of theCompany, directors, corporate auditors and employees of the Company's subsidiaries byoffsetting their monetary remuneration claims accrued as a consideration for their service inthe respective subsidiaries. "Employees" in the above table are directors who are not themembers of the board of the Company.
3. The above table does not include 229 rights of the July 2011 Share Acquisition Rights
allotted to the directors of the Company who were also directors (including non-members of
the board) of the Company's major subsidiaries at the time of the issuance of the shareacquisition rights, which were allotted in their capacity as directors (including non-membersof the board) of these companies by settling their cash remuneration claims against theirrespective companies.
4. The above table does not include 58 rights of the July 2011 Share Acquisition Rights allottedto the corporate officers of the Company (excluding those who are also directors of theCompany) at the time of the issuance of the share acquisition rights, which were allotted intheir capacity as directors (including non-members of the board) of these companies bysettling their cash remuneration claims against their respective companies.

35

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

Remuneration for the fiscal year ended
March 31, 2012

Other matters

Non-audit services (i.e., services
other than those stipulated in
Article 2, paragraph 1 of theCertified Public Accountants Law)
Designated Partners:
provided to the Company by the
independent auditor for a fee:
Chikakuni Yoshida
117 million yen
accounting advisory service related
Takashi Sasaki
to International Financial Reporting
Takaaki Ino
Standards (IFRS) and preliminary
review of internal controls on
financial reports in connection with
the introduction of the newconsolidated accounting system.
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 a part of audit services required by the
Financial Instruments and Exchange Act of Japan for these services are practicallyinseparable.
2. The total amount of cash and other financial benefits payable to the independent auditor by
the Company and its subsidiaries is 762 million yen.

(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.
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.

36

7. Basic Policy Regarding Persons Who Control the Company's Decisions on Financial
Matters and Business Policies
None.

8. System to assure appropriate business operations(1) Establishment and implementation of the internal control system
The Company’s “Basic Policies for Internal Control” guide the development of the groupcompanies’ business administration, compliance, risk management, internal audit and othersystems which comprise Tokio Marine Group’s internal controls. Through these initiatives,
the Company aims to ensure appropriate operations and improve corporate value. The
Company also monitors the establishment and implementation of internal controls on anannual basis, and the Board of Directors verifies these results based on the findings of theInternal Control Committee. Through this process, the Company continues to improve andstrengthen our internal control systems.
(2) Basic Policies for Internal Control
1. System for ensuring proper operations within the Tokio Marine Group (the “Group”)(1) Based upon the "Tokio Marine Group Corporate Philosophy", the Company, as the holding
company presiding over the businesses of the Group, by establishing both the Group's
basic policies for the administration of Group companies and a system of reporting to theBoard of Directors, shall develop the Company's management system for all the Group
companies.
a. The Company shall administer the business of Group companies under its direct
management (“Subsidiaries and Others”) by concluding business managementagreements with them and through other means.
(a) The Company shall provide Subsidiaries and Others with the Group's basic policies
that form the fundamentals of the Group's management strategies and theCompany's management.
(b) Business strategies, business projects and other important plans by Subsidiaries andOthers shall be subject to the Company’s prior approval.
(c) Subsidiaries and Others shall report to the Company their initiatives based on theGroup’s basic policies and the progress of their business plans.
b. The business management of Group companies other than Subsidiaries and Others shall,in principle, be made through Subsidiaries and Others.
(2) The Company shall establish the Group's basic policies for accounting, grasp its
consolidated financial position and the Group companies’ financial positions, and develop
systems for obtaining approval from, and submitting reports to, shareholders andsupervisory organizations and submitting tax returns to authorities in a proper manner.
(3) The Company shall establish the Group's basic policies for internal controls over financial
reporting and develop systems for ensuring the appropriateness and reliability of financial
reporting.
(4) The Company shall establish the Group’s basic policies for disclosure, and develop
systems for disclosing information on corporate activities in a timely and proper manner.
(5) The Company shall establish the Group's basic policies for management of intragrouptransactions and develop systems for such transactions.
37

2. System for ensuring the execution of professional duties in accordance with applicablelaws, regulations and the Articles of Incorporation(1) The Company shall establish the Group's basic policies for compliance and develop
compliance systems.
a. The Company shall establish a department supervising compliance.
b. The Company shall formulate "Group Code of Conduct" and ensure that all directors
and employees of the Group respect such code of conduct and give top priority tocompliance in all phases of the Group's business activities.
c. The Company shall have Subsidiaries and Others prepare compliance manuals andwidely promote compliance within the Group by means of training on laws, regulations,internal rules and other matters which all directors and employees of the Group must
respect.
d. The Company shall establish reporting rules in the event of a violation of laws,
regulations or internal rules within any of the Subsidiaries and Others and, in addition tousual reporting routes, set up hotlines (an internal whistle-blower system) to an internaland external organization and while keeping all directors and employees of the Group
well informed as to the use of the system.
(2) The Company shall establish the Group's basic policies for the protection of customers’interests and maintain a customer-oriented policy in all phases of business in order tomaintain a system for the protection of customers' interests.
(3) The Company shall establish the Group's basic policies for information security
management and develop such systems.
(4) The Company shall establish the Group's basic policies against antisocial factions andgroups, and in association with lawyers, police and other professionals, maintain its
systems against such antisocial factions and groups, and respond to them in an organized
and uncompromising manner by severing relationships with them and refusing unfair
demands.
(5) The Company shall establish an internal audit department separate and independent ofother departments, establish the Group's basic policies for internal audits of the Group andmaintain systems for efficient and effective internal audits within the Company and Group
companies.
3. System for risk management(1) The Company shall establish the Group's basic policies for risk management and maintainrisk management systems.
a. The Company shall establish a department supervising risk management.
b. The Company shall perform risk management by following the basic processes of risk
identification, evaluation and control, contingency planning and assessment of outcomesthrough risk monitoring and reporting.
c. The Company shall have each of the Subsidiaries and Others perform risk management
appropriate to its types of business and its risk characteristics.
(2) The Company shall establish the Group's basic policies for integrated risk management
and perform quantitative risk management across the entire Group to maintain credit
ratings and prevent bankruptcies.
(3) The Company shall establish the Group's basic policies for crisis management andmaintain systems for crisis management.
38

4. System for ensuring efficient execution of professional duties(1) The Company shall formulate a medium-term management plan and an annual plan(including numerical targets, etc.) for the Group.
(2) The Company shall establish rules regarding the exercise of authority and construct anappropriate organizational structure for achieving its business purposes in order to realize
efficient execution of operations through a proper division of responsibilities and a chainof command.
(3) The Company shall formulate rules for and establish a "Management Meeting", composedof directors, executive officers and other relevant persons, that shall discuss and report onimportant management issues.
(4) The Company shall establish an Internal Control Committee that shall formulate various
basic policies and other measures concerning the Group's internal control systems,
evaluate their progress, discuss how to improve them, and promote their development.
(5) The Company shall establish the Group’s basic policies for IT governance, and develop
systems for achieving IT governance.
(6) The Company shall establish the Group's basic policies for personnel matters with a viewto enhancing productivity and corporate value through comprehensive efforts to enhance
employees' satisfaction and pride in their work and promoting fair and transparent
personnel management linked with proper performance evaluation.
5. System for preserving and managing information concerning the execution of directors'
dutiesThe Company shall establish rules for the preservation of documents and other materials.
The minutes of important meetings and documents containing material information
regarding the execution of duties by the directors and the executive officers shall bepreserved and managed appropriately in accordance with such rules.
6. Matters concerning support personnel to the corporate auditors and their independence
from the directors(1) The Company shall establish the Corporate Auditor's Office under the direct control of thecorporate auditors for the purpose of supporting them in the performance of their duties.
Upon request of the corporate auditors, the Company shall assign full-time employees
having sufficient knowledge and ability to support the corporate auditors.
(2) Employees assigned to the Corporate Auditor's Office shall perform duties ordered by the
corporate auditors and other work necessary for proceeding with audits, and such
employees shall have the right to collect information necessary for audit purposes.
(3) Performance evaluations, personnel transfers and disciplinary action concerning such
employees shall be made with the approval of the standing corporate auditors.
7. System of reporting to the corporate auditors(1) Directors and employees shall regularly report to the corporate auditors on management,
financial condition, compliance, risk management, internal audits and other matters, and in
the event that they detect a material violation of laws, regulations or internal rules, or afact likely to cause considerable damage to the Company, they shall immediately report
thereof to the corporate auditors.
(2) Directors and employees shall regularly report to the corporate auditors on matters such as
39

how the hot lines (the internal whistle-blower system) are used and important reports andconsultations made.
8. Other systems for ensuring effective audits by the corporate auditors(1) The corporate auditors shall attend meetings of the Board of Directors, have the right toattend "Management Meetings" and other important meetings and committees, and express
their opinions.
(2) The corporate auditors shall have the right to inspect at any time the minutes of important
meetings and other important documents relating to decisions approved by the directors
and the executive officers.
(3) Directors and employees shall, at any time upon the request of the corporate auditors,
explain matters concerning the execution of their duties.
(4) The Internal Audit Department shall strengthen its coordination with the corporate
auditors by assisting in the audit process and through other means.

9. Matters Concerning Accounting Advisers (Kaikei Sanyo)
None.

10. Other Matters
None.

40

Consolidated Balance Sheet as of March 31, 2012
(Yen in millions)
As of March 31, 2012
(Assets)
Cash and bank deposits
Call loans
Receivables under resale agreements
Receivables under security 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 acceptancesand guarantees

405,432
128,391
304,93158,753
863,794
3,163
12,229,159
424,743
303,819
144,356
137,455
1,818
20,189320,145
4,786
243,091
72,266
1,066,905
174,201
74,359-19,340
16,338,460

Allowance for doubtful accounts
Total assets(Liabilities)

11,822,090
1,444,219
10,377,870
111,140
2,051,509
1,142,039
909,470
175,094

Insurance liabilities
Outstanding claims
Underwriting reserves
Corporate bonds
Other liabilities
Payables under security lending transactions
Other liabilities
Retirement benefit obligations
Retirement benefit obligations for directors and corporate
auditors

25

Reserve under the special law

24,381
70,137

Price fluctuation reserve

70,137

Provision for employees' bonus

41,291
110,964
74,35914,480,995

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

150,000
1,104,810-109,418
1,145,391

Share capital
Retained earnings
Treasury shares
Total shareholders' equity
Accumulated other comprehensive income
Unrealized gains on securities, net of taxes

828,245

Deferred gains/losses on hedge transactions

22,780-156,812
694,213

Foreign currency translation adjustments
Total accumulated other comprehensive income

1,598
16,261
1,857,465
16,338,460

Share acquisition rights
Non-controlling interests
Total net assets
Total liabilities and net assets

41

Consolidated Statement of Income for the fiscal year ended March 31, 2012
(Yen in millions)Year ended March 31, 2012
Ordinary income

3,415,984

Underwriting income

2,978,100

Net premiums written

2,324,492

Deposit premiums from policyholders

141,640Investment income on deposit premiums

60,800Life insurance premiums

344,550

Reversal of underwriting reserves

100,727

Other underwriting income

5,888

Investment income

372,910

Interest and dividends

226,291

Gains on money trusts

289

Gains on trading securities

3,608

Gains on sales of securities

139,434

Gains on redemption of securities

292

Investment gains on separate accounts

52,693

Other investment income

11,100Transfer of investment income on deposit premiums-60,800

Other ordinary income

64,974

Amortization of negative goodwill
Equity in earnings of affiliates

10,250

Other ordinary income

54,038685

Ordinary expenses

3,255,660

Underwriting expenses

2,698,374

Net claims paid

1,660,040

Loss adjustment expenses

97,130Agency commissions and brokerage

445,605

Maturity refunds to policyholders

256,028

Dividends to policyholders

765Life insurance claims

155,113

Provision for outstanding claims

78,014

Other underwriting expenses

5,676

Investment expenses

38,197

Losses on money trusts

295

Losses on sales of securities

18,253

Impairment losses on securities

10,172Losses on redemption of securities

3,220

Losses on derivatives

1,998

Other investment expenses

4,257

Operating and general administrative expenses

515,563

Other ordinary expenses

9,375Interest expenses

2,839

Losses on bad debts
Amortization of deferred assets under Article 113of the Insurance Business Law
Other ordinary expenses
Deferred expenses under Article 113 of the Insurance
Business Law
Ordinary profit
Extraordinary gains

56
1,659
4,820
-5,850160,324
4,901

Gains on disposal of fixed assets

3,132

Gains on negative goodwill
Other extraordinary gains

1,712

57

Extraordinary losses

11,962Losses on disposal of fixed assets

2,542

Impairment losses on fixed assets

1,364

Losses on step acquisitions

2,762

Losses on changes in equity of subsidiaries and affiliates

113

Provision under the special law

4,282

Provision for price fluctuation
Other extraordinary losses

4,282
897

Income before income taxes and non-controlling interests

153,263

Income taxes - current

72,931

Income taxes - deferred

73,935

Total income taxes

146,866

Income before non-controlling interests

6,397

Non-controlling interests

395

Net income

6,001

42

Consolidated Statement of Changes in Shareholders' Equity for the fiscal year ended March 31, 2012
(Yen in millions)Year ended March 31, 2012

Shareholders' equity
Share capital
Beginning balance
Changes during the year
Total changes during the year
Ending balance
Retained earnings
Beginning balance
Changes during the year
Dividends
Net income
Disposition of treasury shares
Changes in the scope of consolidation
Changes in the scope of equity method
Others (Note)
Total changes during the year
Ending balance
Treasury shares
Beginning balance
Changes during the year
Repurchase of treasury shares
Disposition of treasury shares
Total changes during the year
Ending balance
Total shareholders' equity
Beginning balance
Changes during the year
Dividends
Net income
Repurchase of treasury shares
Disposition of treasury shares
Changes in the scope of consolidation
Changes in the scope of equity method
Others (Note)
Total changes during the year
Ending balance
Accumulated other comprehensive income
Unrealized gains on securities, net of tax
Beginning balance
Changes during the year
Net changes in items other than shareholders' equity
Total changes during the year
Ending balance
Deferred gains/losses on hedge transactions
Beginning balance
Changes during the year
Net changes in items other than shareholders' equity
Total changes during the year
Ending balance

43

150,000
150,000
1,135,510-38,343
6,001
-30
2,089
-88
-327
-30,699
1,104,810-109,749
-38
368
330
-109,418
109,418
1,175,760-38,343
6,001
-38
338
2,089
-88
-327
-30,369
1,145,391

822,4815,763
5,763
828,245
16,4836,297
6,297
22,780Consolidated Statement of Changes in Shareholders' Equity for the fiscal year ended March 31, 2012
(Yen in millions)Year ended March 31, 2012

Foreign currency translation adjustments
Beginning balance
Changes during the year
Net changes in items other than shareholders' equity
Total changes during the year
Ending balance
Share acquisition rights
Beginning balance
Changes during the year
Net changes in items other than shareholders' equity
Total changes during the year
Ending balance
Non-controlling interests
Beginning balance
Changes during the year
Net changes in items other than shareholders' equity
Total changes during the year
Ending balance
Total net assets
Beginning balance
Changes during the year
Dividends
Net income
Repurchase of treasury shares
Disposition of treasury shares
Changes in the scope of consolidation
Changes in the scope of equity method
Others (Note)
Net changes in items other than shareholders' equity
Total changes during the year
Ending balance-128,181-28,631-28,631-156,812
1,426
171
171
1,598
16,506-244-244
16,261
1,904,477-38,343
6,001
-38
38
338
2,089
-88
-327
-16,642-47,012
1,857,465(Note) “Others” consisted mainly of reclassification adjustments of tax effects initially appraised in accordance withaccounting policies adopted by foreign consolidated subsidiaries.

44

Notes to Consolidated Financial Statements

Significant matters related to consolidated financial statements
1. Scope of consolidation(1) Number of consolidated subsidiaries: 63 companies
Names of major consolidated subsidiaries:
Tokio Marine & Nichido Fire Insurance Co., Ltd.
Nisshin Fire & Marine Insurance Co., Ltd.
Tokio Marine & Nichido Life Insurance Co., Ltd.
Tokio Marine & Nichido Financial Life Insurance Co., Ltd.
Tokio Marine Millea SAST Insurance Co., Ltd.
Tokio Marine North America, Inc.
Philadelphia Consolidated Holding Corp.
Philadelphia Indemnity Insurance Company
First Insurance Company of Hawaii, Ltd.
Kiln Group Limited
Kiln Underwriting Limited
Tokio Millennium Re (UK) Limited
Tokio Marine Underwriting Limited
Tokio Marine Bluebell Re Limited
Tokio Marine Asia Pte. Ltd.
Asia General Holdings Limited
Tokio Marine Insurance Singapore Ltd.
Tokio Marine Life Insurance Singapore Ltd.
Tokio Marine Life Insurance Malaysia Bhd.
Tokio Marine Seguradora S.A.
Tokio Millennium Re Ltd.
Tokio Marine Financial Solutions Ltd.
Beginning with the fiscal year ended March 31, 2012, Tokio Marine North America, Inc. and The
Tokio Marine and Nichido Fire Insurance Company (China) Limited are included in the
consolidation due to an increase in materiality, and First Insurance Company of Hawaii, Ltd.
(“FICOH”) and 5 other companies because they became subsidiaries due to additional shareacquisition. Manchester Marine Underwriters Limited and 2 other companies are excluded fromthe consolidation because they have been dissolved.
(2) Names of major non-consolidated subsidiaries
Major subsidiaries:
Tokio Marine & Nichido Adjusting Service Co., Ltd.
Tokio Marine Capital Co., Ltd.
Reason the subsidiaries were excluded from the consolidation:
Each of these non-consolidated subsidiaries is small in scale in terms of total assets, sales, net
income or loss for the period and retained earnings. As such non-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 the consolidation.

45

2. Application of the equity method(1) Number of affiliates accounted for by the equity method: 11 companies
Names of major affiliates accounted for by the equity method:
Edelweiss Tokio Life Insurance Company Limited
Edelweiss Tokio Life Insurance Company Limited is accounted for by the equity method from thefiscal year ended March 31, 2012 due to an increase in materiality. WNC Holding Company, LP
and 7 other companies are accounted for by the equity method from the fiscal year ended March 31,
2012 because they became affiliates of the Company through the acquisition of shares. FICOH is
no longer an affiliate accounted for by the equity method because the Company increased its equity
interest in FICOH and FICOH became a subsidiary of the Company during the fiscal year ended
March 31, 2012.
(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, 2012 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 53 overseas
consolidated subsidiaries is December 31. Since the differences in the closing dates do not exceed
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-line46

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.
Bonds earmarked for policy reserves are recognized in the amount of 221,781 million yen on the
consolidated balance sheet as of March 31, 2012. The fair value thereof is 235,771 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 andbonds 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 for which the fair value is difficult to ascertain are recorded at cost determined by
the moving-average method.
f. Equity shares in non-consolidated subsidiaries and affiliates that are not accounted for by theequity 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.
(2) Valuation of derivative financial instruments

Derivative financial instruments are accounted for by the mark-to-market method.
(3) Depreciation method for 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

47

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 allowancesa. Allowance for doubtful accounts
In order to provide for losses from defaults, domestic consolidated subsidiaries of the Company
establish allowance for doubtful accounts 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.), allowance iscalculated 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, allowance iscalculated 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, allowance is 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.
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. Allowance for doubtful accounts is recorded
based on such assessment results and audits stated above.
b. Retirement benefit obligations
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, 2012
based on the projected retirement benefit obligations and related pension assets at the end of the fiscal
year ended March 31, 2012.
Prior service costs are charged to expenses in each subsequent consolidated fiscal year by using thestraight-line method over a certain term (7-14 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 theemployees.
c. Retirement benefit obligations 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, 2012, which is calculated in accordance with their internal remuneration regulations.

48

d. Provision for employees’ bonus
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. Price fluctuation reserve
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 5 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 of its domestic
consolidated subsidiaries with lease periods commencing prior to April 1, 2008 under the accounting
policy applied to normal lease transactions.
(8) Hedge accounting
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 based upon
the Industry Audit Committee Report No. 26, “Accounting and Auditing Treatments related to
Adoption of Accounting for Financial Instruments in the Insurance Industry” (issued by the JICPA,
September 3, 2002 - hereinafter called “Report No. 26”).
Effectiveness is not evaluated for hedge treatments that are believed to have high hedge effectiveness,because the Company groups hedged insurance liabilities with the interest rate swaps that are thehedge instruments, based on the period remaining for the instruments.
Any deferred gains as of the end 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 the application of Report No. 26, are accounted for by Tokio Marine & Nichidousing the straight-line method over the remaining hedging period (1-17 years). Tokio Marine &Nichido Life also uses the straight-line method to account for such deferred gains as of the end of
March 2002 over the remaining hedging period (6-10 years). The accounting treatments for such49

deferred gains are based on the transitional measures in Report No. 26. Deferred gains under thistreatment as of March 31, 2012 were 22,693 million yen and the amount accounted for in the
consolidated financial statements for the fiscal year ended March 31, 2012 was 4,008 million yen.
b. Foreign exchangeWith regard to some of Tokio Marine & Nichido’s currency forward transactions, which have beenentered into for the purpose of hedging foreign exchange risk associated with assets denominated inforeign currencies, (a) fair value hedge accounting and/or (b) matching treatment are applied. The
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 importantcharacteristics.
Tokio Marine & Nichido applies deferred hedge accounting to some of currency forward contracts itenters in order to secure yen-denominated cash flow in forecast transactions in foreign currency.
Hedge effectiveness is evaluated based on a comparison of the aggregate market fluctuation of thehedged instruments and hedging tools during the period from when the hedge was entered and endingat the time of the evaluation.
(9) Matters concerning amortization of goodwill and negative goodwill
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. (“PHLY”) andKiln Group Limited is amortized over 20 years and 10 years, respectively, using the straight-line
method. Other goodwill is amortized over 2 to 15 years using the straight-line method. Other
goodwill in small amounts are amortized at one time.
Negative goodwill that arose on or before March 31, 2010 is recognized as a liability on the
consolidated balance sheet and amortized over 20 years using the straight-line method.
(10) Accounting for deferred assets under Article 113 of the Insurance Business Law
The Company evaluated the amount of provisions for and amortization of deferred assets under Article
113 of the Insurance Business Law for E. design Insurance Co., Ltd. in accordance with applicablelaws and regulations and the Articles of Incorporation of E. design Insurance Co., Ltd.

Notes regarding additional information
Application of “Accounting Standard for Accounting Changes and Error Corrections”
The Company has applied “Accounting Standard for Accounting Changes and Error Corrections”(ASBJ Statement No. 24, December 4, 2009) and “Guidance on Accounting Standard for Accounting
Changes and Error Corrections” (ASBJ Guidance No. 24, December 4, 2009) to accounting changes
and corrections of past errors that were made on or after April 1, 2011.
Effects of changes in the corporate income tax rate
Following the promulgation of the “Act for Partial Amendment of the Income Tax Act, etc. for the
Purpose of Creating a Taxation System Responding to Changes in Economic and Social Structures”(Act No. 114, 2011) and the “Act on Special Measures for Securing Financial Resources Necessary to
Implement Measures for Reconstruction following the Great East Japan Earthquake” (Act No. 117,50

2011) on December 2, 2011, the corporate income tax rate will be lowered and a special restoration
surtax will be imposed from the fiscal year beginning on April 1, 2012.
As a result of this change, deferred tax assets (net of deferred tax liabilities) decreased by 16,123
million yen and unrealized gains on securities, net of taxes increased by 62,512 million yen. Also,
income before income taxes and non-controlling interests increased by 15,462 million yen and net
income decreased by 64,550 million yen.
Statutory effective tax rates applied to the Company and Tokio Marine & Nichido are as follows:a. Tax rates applied to the Company;- Before the change: 40.7%- Fiscal years beginning between April 1, 2012 and April 1, 2014: 38.0%- Fiscal years beginning on and after April 1, 2015: 35.6%
b. Tax rates applied to Tokio Marine & Nichido- Before the change: 36.1%- Fiscal years beginning between April 1, 2012 and April 1, 2014: 33.2%- Fiscal years beginning on and after April 1, 2015: 30.7%

Notes to consolidated balance sheet
1. Accumulated depreciation of tangible fixed assets is 343,158 million yen and advanced depreciationof such assets is 20,873 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 12,138 million yen.
The breakdown is set forth below.
(1) The amount of loans to borrowers in bankruptcy is 1,289 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.).
Loans to 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 toallowance for doubtful accounts) and subparagraph 4 of the Enforcement Ordinance of the
Corporation Tax Law (Ordinance No. 97, 1965).
(2) The amount of past due loans is 5,653 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 58 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 5,136 million yen.
51

Restructured loans are loans on which concessions (e.g., reduction of the original interest rate, deferralof interest payment, extension of the maturity date, forgiveness of debt) are granted to borrowers infinancial difficulties to assist them in their corporate restructuring by improving their ability to repay
creditors. Restructured loans do not include loans classified as loans to borrowers in bankruptcy, past
due loans or loans past due for three months or more.
3. The value of assets pledged as collateral totals 401,835 million yen in securities and 24,640 million
yen in savings deposits. Collateralized debt obligations are held to the value of 139,852 million yen
in outstanding claims, 52,725 million yen in underwriting reserve and 22,688 million yen in otherdebts (including foreign reinsurance related debts, etc.).
4. Securities received in connection with securities borrowing transactions have a fair value of 73,774
million yen.
5. Securities include securities lent under loan agreements of 1,206,221 million yen.
6. The outstanding balance of undrawn committed loans is as follows.
(Yen in millions)
62,581
6,931
55,650Total loan commitments
Balance of drawn committed loans
Undrawn loan commitments

7. The amount of both assets and liabilities for special account as prescribed in Article 118 of the
Insurance Business Law of Japan totals 2,140,793 million yen.
8. Total investment in non-consolidated affiliates is 84,954 million yen.
9. Tokio Marine & Nichido guarantees the liabilities of some of its subsidiaries.
guarantee to its subsidiaries as of March 31, 2012 is as follows:

TNUS Insurance Company
Tokio Marine Compaňía de Seguros, S.A. de C.V.
Tokio Marine Pacific Insurance Limited
Total

The balance of the(Yen in millions)
14
3,079
3,372
6,465

10. Other assets include 14,746 million yen of deferred assets under Article 113 of the Insurance
Business Law of Japan.

Notes to consolidated statement of income
1. Major components of business expenses(Yen in millions)
Agency commissions, etc.
403,324
Salaries
217,292
Business expenses consist of "Loss adjustment expenses", "Operating and general administrative52

expenses" and "Agency commissions and brokerage" as shown in the accompanying consolidated
statement of income.
2. The main components of other extraordinary gains are settlement money received amounting to
1,206 million yen.
3. The Company recognized impairment losses on the following properties during the fiscal year
ended March 31, 2012.
Purpose of use
Properties forbusiness use(insurance andnursing careservices)
Properties for rent
Idle or potential
disposal
properties

Category

Location

Buildings andothers5 properties
including equipment
attached to buildingsin Shinagawa-ku,
Tokyo
4 properties
including a buildingin Komatsu-shi,Ishikawa
34 properties
including a buildingin Higashiosaka-shi,
Osaka

Land andbuildings
Land andbuildings

Total

Impairment loss (Yen in millions)
Land
Building Others
Total
95
101
197

37

78

-

116

678

372

-

1,050

716

546

101

1,364

Classification of properties: (a) properties used for the insurance business and other businesses aregrouped by each company in consolidation; and (b) other properties including properties for rent andidle or potential disposal properties and properties used for nursing care services are grouped based on
their primary uses on an individual basis.
For certain consolidated subsidiaries, the total amount of projected future cash flows from properties
for business use in their insurance and nursing care businesses fell below the book values of theseproperties. 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. The Company has recorded the recoverable value of the relevant assets as a net sales price in
the insurance business. However, such net sales price is a memorandum price because of the
difficulty in making a reasonable estimate of the amount. The Company calculates the recoverable
value of the relevant property in the nursing care services by discounting projected future cash flows at
a rate of 6.0 percent.
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 byreal estate appraisers minus anticipated expenses for disposal of the relevant properties. The
Company calculated the utility values of the relevant properties by discounting projected future cash
flows at a rate of 10.0 percent.

53

Notes to consolidated statement of changes in shareholders' equity
1. Class and number of issued shares and treasury share
Number ofshares as of April
1, 2011(Unit: thousand shares)
Decrease during Number ofthe fiscal year
shares as ofended March 31, March 31,
2012
2012

Increase during
the fiscal year
ended March 31,
2012

Issued shares
Common share
Total
Treasury share

804,524804,524--804,524804,524

Common share
Total

37,70437,704

18
18

126
126

37,596
37,596

Notes: 1. The increase of 18 thousand treasury shares is attributable to acquisition of sharesconstituting less than one unit of common share.
2. The decrease of 126 thousand treasury shares is primarily attributable to the allotments ofshares in connection with exercises of share acquisition rights which decreased treasury
share by 124 thousand.
2. Share acquisition rights (including those owned by the Company)
Category

Nature of share acquisition rights

Amount as of March 31, 2012
(Yen in millions)

The Company(parent company)

Share acquisition rights as shareoptions

1,598

3. Dividends(1) Amount of dividends
Resolution
Ordinary general
meeting ofshareholders heldon June 27, 2011
Meeting of theboard of directors
held on November
18, 2011

Class ofshare

Total amountof dividends
paid(yen inmillions)

Amount ofdividends per
share
(yen)

Record dateCommonshare

19,17025

March 31,2011

June 28,
2011

Commonshare

19,17325

September
30, 2011

December 6,
2011

Effectivedate(2) Dividends of which the record date falls within the fiscal year ended March 31, 2012, and of which
the effective date falls on or after April 1, 2012.
The Company intends to obtain approval for the following dividend payment at the 10th Ordinary
General Meeting of Shareholders to be held on June 25, 2012.

54

Resolution

Class of
share

Total
amount ofdividends
paid(yen inmillions)

Source ofdividends

Amount ofdividends
per share(yen)

Recorddate

Effective
date

Ordinary general
meeting ofshareholders to beheld on June 25, 2012

Commonshare

19,173Retainedearnings

25

March 31,2012

June 26,
2012

Information on financial instruments
1. Qualitative information on financial instruments
The Group's core operation is its insurance business and it generally makes investments based on cash
inflows mainly arising from insurance premiums. Investment assets are managed in two categories,
which are "Assets backing insurance liabilities" corresponding to long-term insurance contracts suchas deposit type insurance and annuity, and "Other".
With regard to "Assets backing insurance liabilities", Asset Liability Management ("ALM") is appliedin order to ensure future payments for maturity-refunds and claims. Through ALM, the Group aims
to steadily maximize the value of surplus ("Investment assets" minus "Insurance liabilities") bycontrolling the interest rate risks to which insurance liabilities are exposed and by investing in
instruments with some credit risks, mostly bonds with high credit ratings.
With regard to "Other", the Group works toward diversification of investments and improvement ofinvestment efficiency in order to generate sustainable investment income, while maintaining liquidity
for future claims payments.
In major consolidated subsidiaries, the risk management department, which is independent of
departments executing investment transactions, quantitatively and qualitatively controls risks in orderto deal with such investment risks.
Through these approaches, the Group aims to minimize fluctuations in short-term gains and losses,
increase investment income in order to maximize net asset value in the mid-to-long-term, and maintainfinancial soundness.
2. Fair value of financial instruments
Table below shows the fair value of financial instruments excluding those without reasonably
measured fair value as of March 31, 2012.

55

(Yen in millions)

(1)
(2)
(3)
(4)
(5)
(6)
(7)

(8)

(9)
(10)
(11)

Cash and bank deposits
Call loans
Receivables under resaleagreements
Receivables under security
borrowing transactions
Monetary receivables bought
Money trusts
Securities
Trading securities
Bonds held to maturity
Bonds earmarked for policy
reserves
Available for sale securities
Loans
Allowance for doubtful
accounts (*1)
Corporate bonds (*2)
Payables under security
lending transactions (*2)
Derivative assets andliabilities (*3)

Carrying amountshown on balance
sheet
405,432
128,391

Fair Value

Difference

405,437
128,3915-

304,931304,931-58,75358,753-

863,794
3,163

863,794
3,163-

2,430,360
2,282,032

2,430,360
2,376,781

94,749221,781

235,771

13,9906,980,137

6,980,137-

317,975

331,503

13,528（111,140）（112,494）-1,354（1,142,039）（1,142,039）-

54,26654,266-328,127-10,152(*1) Allowance for doubtful accounts earmarked for loans are deducted from the carrying amount.
(*2) Items in liabilities are shown with ( ).
(*3) Derivative assets and liabilities are presented on a net basis. Debits and credits arising fromderivative transactions are netted.

Notes: 1. Valuation method for financial instruments
With regard to (1) Cash and bank deposits (excluding those defined as securities in"Accounting Standard for Financial Instruments" (ASBJ Statement No.10)), (2) Call loans,(3) Receivables under resale agreement, and (4) Receivables under security borrowing
transactions, the book value is deemed as the fair value since it is scheduled to be settled in ashort period of time and the book value approximates the fair value.
Regarding (7) Securities (including those in (1) Cash and bank deposits and (5) Monetary
receivables bought that are defined to be securities in "Accounting for Financial Instruments"(ASBJ Statement No.10) and securities in (6) Money trusts that are invested as trust funds)
with quoted market price, the quoted closing price is used for listed shares and the price ofthe over-the-counter transactions is used for bonds. For securities with no quoted market
price, the net present value of the estimated future cash flows is applied as the fair value.
With regard to floating rate loans in (8) Loans, the book value is deemed as the fair value
unless the borrower's credit standing has materially changed since the execution of the loan
because interest rate changes will be timely reflected in the future cash flows and the bookvalue approximates the fair value. For fixed rate loans, the fair value is measured as the netpresent value of estimated future cash flows. For loans where borrowers are insolvent or in56

bankruptcy proceedings, the estimated uncollectible debts are deducted from the carrying
amount to get the fair value.
With regard to (9) Bonds, the price of the over-the-counter transactions is the fair value.
With regard to (10) Payables under security lending transactions, the book value is deemedas the fair value because it is scheduled to be settled in a short period of time and the bookvalue approximates the fair value.
With regard to (11) Derivative assets and liabilities with quoted market price, the quoted
closing price is used as the fair value. For derivative assets and liabilities with no quoted
market price, the net present value of the estimated future cash flows or the calculated pricebased on an option pricing model is applied as the fair value.
2. Unlisted stocks and partnership investments comprised of unlisted stocks (Carrying amounton the consolidated balance sheet: 314,848 million yen) are not included in (7) Securities
because the fair value cannot be determined as they have no quoted market price and thefuture cash flow cannot be estimated.
Policy loans (Carrying amount on the consolidated balance sheet: 96,615 million yen) are notincluded in (8) Loans because future cash flows cannot be estimated since it is arranged
under insurance policy and the amount is limited within repayment fund for cancellation withno contractual maturity.

Information on Investment Property
1. Some of the consolidated subsidiaries hold office buildings and land mainly in Tokyo, Osaka andNagoya, some of which are leased out.
2. Fair value of investment property(Yen in millions)
Carrying amount shown on balance
sheet as of March 31, 2012

Fair value as of March 31, 2012

78,152

123,386

Notes: 1. Carrying amount is the amount that the accumulated depreciation and the accumulated
impairment losses are deducted from the acquisition cost.
2. Fair value as of March 31, 2012 is primarily based on appraisals by qualified external
valuers.

Per share information
Net assets per share
Net income per share

2,398.66 yen
7.82 yen57

Notes on subsequent events
On April 25, 2012, Tokio Marine & Nichido, a subsidiary of the Company, entered a loan agreement inconnection with the acquisition of Delphi Financial Group, Inc. (“Delphi”), a U.S. life and property andcasualty insurance group, as detailed below.
(1) Lender: The Bank of Tokyo-Mitsubishi UFJ, Ltd.
(2) Loan amount: Approximately 100 billion yen(3) Repayment date: May 23, 2017(4) Collateral or guarantee: None

Others
1. Business combination by acquisition
On November 29, 2011, the Company acquired 50% of the issued shares of FICOH and made it a wholly
owned subsidiary through Tokio Marine & Nichido, a subsidiary of the Company. The acquired shares of
FICOH were previously owned by CNA Financial Corporation, a major insurance group in the U.S.,
through its subsidiary The Continental Insurance Company.
(1) Outline of the business combinationa. Name of the acquireeFirst Insurance Company of Hawaii, Ltd.
b. Business
Property and casualty insurancec. Business combination objectives
Tokio Marine Group is seeking further growth in both earnings and scale in the U.S. insurance market,
by combining FICOH's high profile and strong brand with Tokio Marine Group’s strengths of superior
financial ratings and underwriting capacity and back-office support capabilities.
d. Date of the business combination
November 29, 2011
e. Form of the business combination
Acquisition of shares by cash
f. Voting rights acquired through the business combination
Voting rights held immediately prior to the business combination
50%
Additional voting rights acquired on the date of the business combination

50%
100%

Voting rights after the acquisition(2) Period for which the acquiree’s operating results are included in the consolidated statement of incomeof the Company
The deemed acquisition date is December 31, 2011. Prior to the date, the acquiree’s operating results
were accounted as equity in earnings of affiliates.
(3) Acquisition cost and its detail
Fair value as of the date of the business combination of FICOH
shares held immediately prior to the business combination
Fair value of additional FICOH shares acquired on the date ofbusiness combination
Direct costs of the acquisition

58

12,723

million yen

12,723

million yen

61million yen

Acquisition cost

25,507

million yen(4) Difference between the acquisition cost and the total cost of each transaction in the acquisition
Acquisition cost
25,507 million yen
Total cost of each transaction in the acquisition
28,269 million yen
Loss on step acquisition-2,762 million yen(5) Amount, reason for recognition, method and period of amortization of goodwill
a. Amount of goodwill
1,653 million yen
b. Reason for recognition of goodwill
The acquisition cost of the acquiree, which was calculated by taking into account projections of theacquiree’s future revenue as of the valuation date, exceeded the net amounts of assets acquired andliabilities assumed.
c. Period and method of amortization of goodwill
2 years using the straight line method(6) Assets and liabilities assumed on the date of the business combination and their main components
AmountAmountItem
Item(Yen in millions)

Total assets(Securities)(Yen in millions)53,215 Total liabilities

29,361

44,16627,304(Insurance liabilities)(7) Approximate impact on the consolidated statement of income, assuming that the business combination
took place at the beginning of the fiscal year ended March 31, 2012
Ordinary income: 12,994 million yen; ordinary profit: 109 million yen; net income: -225 million yen.
These amounts represent the difference between the actual figures and the estimates of the figures forordinary income, ordinary profit and net income calculated based on the assumption that the businesscombination was completed at the beginning of the fiscal year ended March 31, 2012. The amount of
goodwill amortization was calculated assuming that the goodwill recognized at the time of the businesscombination was recognized at the beginning of the fiscal year ended March 31, 2012.
The above amounts are un-audited.
2. Subsequent event related to a business combination
On May 15, 2012, through Tokio Marine & Nichido, a subsidiary of the Company, the Company acquired
100% of the issued shares of Delphi, a U.S. life and property and casualty insurance group.
(1) Business combination objectives
Tokio Marine Group is: (i) seeking further growth in both the earnings and scale of its overseas
businesses; (ii) creating a more diverse business portfolio; and (iii) establishing new business
opportunities through synergies with PHLY and other current U.S. operations.
(2) Outline of the business combinationa. Name of the acquiree
Delphi Financial Group, Inc.
b. Location
Wilmington, Delaware U.S.A.
c. BusinessInsurance group holding company
d. Premium and fee income (for the year ended December 31, 2011)59

1,564 million U.S. dollars (equivalent to 128,564 million yen*)e. Total assets (as of December 31, 2011)
8,634 million U.S. dollars (equivalent to 709,661 million yen*)(3) Acquisition cost
213,570 million yen
Direct costs of the acquisition are not included in the above since the amount has not been fixed.
(4) Financing of the acquisition cost
Outside loans(5) Method and process of acquisition
Reverse triangular merger under laws concerning business combination in the U.S.
*Note: U.S. dollars were calculated in Japanese yen based on the exchange rate as at the end of March 2012.

60

Non-consolidated Balance Sheet as of March 31, 2012
(Yen in millions)
As of March 31, 2012
AssetsCurrent assets:
Cash and bank deposits
Prepaid expense
Receivables
Receivable consumption tax
OthersTotal current assets
Fixed assets:
Tangible fixed assets
Buildings
Motor vehicles and transport equipment
Office equipment
Total tangible fixed assets
Intangible fixed assets
Telephone right
Total intangible fixed assets
Investments and other assets
Investments in subsidiaries and affiliates
OthersTotal investments and other assets
Total non-current assets
Total assets
Liabilities
Current liabilities:
Accounts payable
Accrued expenses
Accrued income taxes
Accrued business office taxes
Deposits received
Reserve for bonus
OthersTotal current liabilities
Fixed liabilities:
Long-term accounts payable
Reserve for retirement benefit
Total fixed liabilities
Total liabilities
Net assets
Shareholders' equity:
Share capital
Capital surplus
Additional paid-in capital
OthersTotal capital surplus
Retained earnings
Other retained earnings
General reserve
Retained earnings carried forward
Total retained earnings
Treasury share
Total shareholders' equity
Share acquisition rights
Total net assets
Total liabilities and net assets

61

2,324
0
20,57123
422,924

202
11
64
277
0
0
2,483,650
78
2,483,729
2,484,008
2,506,933

401
224
46
9
14
331
11
1,040
16
185
202
1,242

150,000
1,511,485
86,457
1,597,942
865,567
732,275
133,292
865,567-109,418
2,504,091
1,598
2,505,690
2,506,933

Non-consolidated Statement of Income for the fiscal year ended March 31, 2012
(Yen in millions)Year ended March 31, 2012
Operating income:
Dividends received from subsidiaries and affiliates

77,872Fees received from subsidiaries and affiliates

6,083

Total operating income

83,955

Operating expenses:
Operating and general administrative expenses

6,256

Total operating expenses

6,256

Operating profit

77,699Non-operating income:Interest income

1Interest on securities

12

Gains on lapsed dividend payment obligation
Other non-operating income

33
0Total non-operating income

48

Non-operating expenses:
Miscellaneous expenses

0

Total non-operating expenses

0

Ordinary profit

77,747Extraordinary losses:
Losses on sales of fixed assets

0

Losses on disposal of fixed assets

143

Impairment losses on investment of subsidiaries

and affiliates

15,015

Total extraordinary losses

15,158

Income before income taxes

62,588

Income taxes-current

3

Refunded corporate income tax-29

Income taxes-deferred

503

Total income taxes

477

Net income

62,11062

Non-consolidated Statement of Changes in Shareholders' Equity for the fiscal year ended March 31, 2012
(Yen in Millions)Shareholders' equity
Retained earnings
Other retained earnings

Capital surplus

Beginning balance as of April 1, 2011

Share capital

Additional
paid-in capital

150,000

1,511,485

OthersGeneralreserve

86,487

Total

Treasury share shareholders'
Retained
equityearnings carriedforward732,275

109,525-109,749

2,480,024

Changes during the year
Dividends-38,343-38,343

Net income

62,11062,110

Repurchase of treasury shares
Disposition of treasury shares

-30

-38

-38

368

338

Net changes in items other thanshareholders' equity
Total changes during the year
Ending balance as of March 31, 2012

-

-

-30

-

23,767330

24,067150,000

1,511,485

86,457732,275

133,292-109,418

2,504,091

ShareacquisitionrightsBeginning balance as of April 1, 2011

1,426

Total net
assets2,481,451

Changes during the year
Dividends-38,343

Net income

62,110

Repurchase of treasury shares-38

Disposition of treasury shares

338

Net changes in items other thanshareholders' equity
Total changes during the year
Ending balance as of March 31, 2012

171

171

171

24,2391,598

2,505,690

63

Notes to Non-consolidated Financial Statements
Significant accounting policies
1. Valuation of securities
Investments in subsidiaries and affiliates 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 tobuildings) is computed using the declining-balance method principally over the following useful
lives. Depreciation of buildings (excluding auxiliary facilities attached to buildings) is computed
using the straight-line method.
Auxiliary facilities attached to buildings
Equipment and furniture

8 to 18 years
3 to 15 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, 2012.
4. Consumption taxes

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

Notes regarding additional information
Application of “Accounting Standard for Accounting Changes and Error Corrections”
The Company has applied “Accounting Standard for Accounting Changes and Error Corrections”(ASBJ Statement No. 24, December 4, 2009) and “Guidance on Accounting Standard for
Accounting Changes and Error Corrections” (ASBJ Guidance No. 24, December 4, 2009) toaccounting changes and corrections of past errors that were made on or after April 1, 2011.

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

138 million yen

2. Monetary claims against and debts owed to affiliates:
Monetary claims receivables
5,877 million yen

64Debts payable

234 million yen

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

16 million yen

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

83,955 million yen
965 million yen
34 million yen

Notes to the statement of changes in shareholders' equity
Class and number of treasury share held by the Company as of March 31, 2012:
Common share
37,596,309 shares

Tax effect accounting
Major components of deferred tax assets:
Deferred tax assets
Impairment losses on investment in affiliates 33,641 million yen
Others
443 million yen
Subtotal
34,084 million yen
Valuation allowance-34,084 million yen
Total deferred tax assets- million yen
Net deferred tax assets- million yen

Notes on transactions with related parties

Category

Company
name

Percentage
of votingrights held

Relationship

Subsidiary

Tokio
Marine&NichidoFinancial
Life

100% held
directly

Overlapping Participation
management,
in a rights
etc.
offering

Transaction
description(Yen in millions)
Balance
Transaction
at endItemamountof fiscalyear

40,000-Terms and conditions and corresponding decision-making policies for these transactions:

65-

The Company purchased shares offered by Tokio Marine & Nichido Financial Life at 100,000
yen per share.

Per-share information
Net assets per share
Net income per share

3,265.09 yen
80.98 yen66

Copy of Independent Auditor’s Report on Consolidated Financial Statements[English Translation]
Independent Auditor's Report
May 16, 2012
To the Board of Directors
Tokio Marine Holdings, Inc.
PricewaterhouseCoopers Aarata
Chikakuni Yoshida, CPA
Designated Partner and Engagement
Partner
Takashi Sasaki, 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, 2011 and ended on March 31, 2012. These financial
statements consist of a consolidated balance sheet, a consolidated statement of income, aconsolidated statement of changes in shareholders' equity and notes to consolidated financial
statements.
Management's responsibility for the financial statements:
It is the Management’s responsibility to prepare consolidated financial statements based on
accounting principles generally accepted in Japan and to present these statements appropriately.
This includes establishing and implementing internal control systems that Management deems
necessary to prepare and present the consolidated financial statements without material
misstatement resulting from fraud or error.
Auditor's responsibility:
It is our responsibility to express an opinion on the 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, in order to obtainreasonable assurance about whether the consolidated financial statements are free of material
misstatement, we formulate an audit plan and conduct an audit in accordance therewith.
An audit includes procedures to obtain audit evidence in relation to the amounts and disclosuresin the consolidated financial statements. We select and apply audit procedures based on our
judgment and in accordance with a risk evaluation for material misstatement in the consolidated
financial statements resulting from fraud or error. Although the purpose of our audit is not to
express an opinion on the effectiveness of internal control systems, when conducting the risk
evaluation to determine the proper audit procedures we do review the internal control systems
for the preparation and appropriate presentation of the consolidated financial statements. An
audit includes assessing the accounting principles used by management, including how they areapplied, and the estimates made by management, as well as examining the overall presentationof the consolidated financial statements. We believe that our audit provides a sufficient andappropriate basis for our opinion.
67

Audit 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.
Conflict of interest:
Our firm and engagement partners do not have any interest in the Company that is required tobe disclosed pursuant to the provisions of the Certified Public Accountants Law of Japan.

68Copy of Independent Auditor’s Report on Non-consolidated Financial
Statements[English Translation]
Independent Auditor's Report
May 16, 2012
To the Board of Directors
Tokio Marine Holdings, Inc.
PricewaterhouseCoopers Aarata
Chikakuni Yoshida, CPA
Designated Partner and Engagement
Partner
Takashi Sasaki, 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 10th fiscal year that began on April 1, 2011 and ended on March 31, 2012.
These financial statements consist of a non-consolidated balance sheet, a non-consolidated
statement of income, a non-consolidated statement of changes in shareholders' equity, notes tonon-consolidated financial statements and supplementary schedules.
Management's responsibility for the financial statements:
It is the Management’s responsibility to prepare non-consolidated financial statements andsupplementary schedules based on accounting principles generally accepted in Japan and topresent these statements appropriately. This includes establishing and implementing internal
control systems that Management deems necessary to prepare and present the non-consolidated
financial statements and supplementary schedules without material misstatement resulting fromfraud or error.
Auditor's responsibility:
It is our responsibility to express an opinion on the non-consolidated financial statements andsupplementary schedules 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, in order to obtain reasonable assurance about whether the non-consolidated
financial statements and supplementary schedules are free of material misstatement, weformulate an audit plan and conduct an audit in accordance therewith.
An audit includes procedures to obtain audit evidence in relation to the amounts and disclosuresin the non-consolidated financial statements and supplementary schedules. We select andapply audit procedures based on our judgment and in accordance with a risk evaluation formaterial misstatement in the non-consolidated financial statements and supplementary schedules
resulting from fraud or error. Although the purpose of our audit is not to express an opinion on
the effectiveness of internal control systems, when conducting the risk evaluation to determine
the proper audit procedures we do review the internal control systems for the preparation andappropriate presentation of the non-consolidated financial statements and supplementaryschedules. An audit includes assessing the accounting principles used by management,69

including how they are applied, and the estimates made by management, as well as examining
the overall presentation of the non-consolidated financial statements and supplementaryschedules. We believe that our audit provides a sufficient and appropriate basis for our
opinion.
Audit 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.
Conflict of interest:
Our firm and engagement partners do not have any interest in the Company that is required tobe disclosed pursuant to the provisions of the Certified Public Accountants Law of Japan.

70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, 2011 andended on March 31, 2012 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 including responses to the Great East Japan Earthquake 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 andfinancial 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
over financial reporting, each corporate auditor received from directors andPricewaterhouseCoopers Aarata reports regarding the results of the assessment and audit on theinternal control over financial 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, 2012 based on the71

aforesaid methods of audit.
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 shareholders'equity and notes thereto) and the supplementary schedules thereto, and the consolidated
financial statements (balance sheet, statement of income, statement of changes in shareholders'equity and notes thereto) for the fiscal year ended March 31, 2012.
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
the Company.
(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 17, 2012
Board of Corporate Auditors,
Tokio Marine Holdings, Inc.

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Toshiro Yagi, Standing Corporate Auditor
Toshiki Ohashi, Standing Corporate Auditor
Hiroshi Fukuda, Corporate Auditor
Yuko Kawamoto, Corporate Auditor
Akinari Horii, Corporate Auditor
Note: Mr. Hiroshi Fukuda, Ms. Yuko Kawamoto and Mr. Akinari Horii are the outside corporate
auditors, fulfilling the position prescribed by Article 2, item 16 of the Companies Act ofJapan.

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