NEWS RELEASE
February 12, 2019
Ryosuke Mori, President
LIFENET INSURANCE COMPANY(Securities Code: 7157, TSE Mothers)

Financial Results for 3Q of Fiscal 2018 Ending March 31, 2019
Annualized premium of new business of 1,951 million yen, up 63.8% year on year
TOKYO, February 12, 2019 - LIFENET INSURANCE COMPANY (TSE Mothers 7157,
President Ryosuke Mori, URL: https://ir.lifenet-seimei.co.jp/en/) discloses financial results for thethird quarter of fiscal 2018 ending March 31, 2019.
1．Overview of the financial results for 3Q of fiscal 2018
(1) Business results
Condition of policies-in-force
Annualized premium*1 of new business in 3Q ended December 31, 2018 was 741 million yen(161.1% of 3Q of fiscal 2017). The number of new business was 17,312 (164.0% of 3Q of fiscal
2017). Annualized premium*1 of new business for the nine months ended December 31, 2018
was 1,951 million yen (163.8% of the nine months ended December 31, 2017). The number of
new business for the nine months ended December 31, 2018 was 45,360 (168.0% of the ninemonths ended December 31, 2017).
Annualized premium *1 of policies-in-force as of the end of 3Q of fiscal 2018 stands at 12,510
million yen (112.2% of March 31, 2018). The number of policies-in-force resulted in a total of
295,662 (112.1% of March 31, 2018) and exceeded 300,000 in January 2019. Surrender andlapse ratio*2 for the nine months ended December 31, 2018 was 6.3% (5.9% for the ninemonths ended December 31, 2017).
*1: Annualized premium is the amount of money equivalent to what is to be paid to have the insurance coverage for one
year. All payments for Lifenet products are in monthly installments, we calculate annualized premium as multiplying
the monthly premium by 12 months.
*2: The surrender and lapse ratio is the annual equivalent of the monthly number of policies surrendered and/or lapsed
divided by the monthly average number of policies-in-force.

Results of operations
Insurance premiums and other for the nine months ended December 31, 2018 increased to
8,949 million yen (113.8% of the nine months ended December 31, 2017) due to an increase in
the number of policies-in-force. Investment income grew to 292 million yen (162.1% of the ninemonths ended December 31, 2017). Other ordinary income was 117 million yen. As a result,ordinary income for the nine months ended December 31, 2018 amounted to 9,359 million yen(116.0% of the nine months ended December 31, 2017).
Insurance claims and other was 1,950 million yen (136.8% of the nine months ended
December 31, 2017). The ratio of insurance payment amounts to insurance premiums was
18.4% for the nine months ended December 31, 2018, compared with 15.5% for the ninemonths ended December 31, 2017. Provision for policy reserves and other came to 2,962
million yen (108.2% of the nine months ended December 31, 2017). The ratio of provision forpolicy reserves to insurance premiums was 34.0% for the nine months ended December 31,
2018, compared with 34.9% for the nine months ended December 31, 2017. Operating
expenses amounted to 4,850 million yen (139.2% of the nine months ended December 31,2017) mainly due to increasing our marketing spend including advertising. The components ofoperating expenses were 2,850 million yen in marketing expenses (163.7% of the nine months
ended December 31, 2017), 578 million yen in customer service expenses (113.4% of the ninemonths ended December 31, 2017), and 1,421 million yen in system and other expenses
Copyright© LIFENET INSURANCE COMPANY All rights reserved.

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NEWS RELEASE(115.3% of the nine months ended December 31, 2017). Other ordinary expenses was 540
million yen (124.4% of the nine months ended December 31, 2017). Consequently, ordinary
expenses for the nine months ended December 31, 2018 totaled 10,303 million yen (127.5% of
the nine months ended December 31, 2017).
As a result, ordinary loss totaled 944 million yen for the nine months ended December 31,
2018, compared with 11 million yen for the nine months ended December 31, 2017. Net loss
was 957 million yen, compared with 42 million yen for the nine months ended December 31,
2017.
In addition, fundamental profit, which is an indicator for the profitability of life insurancecompanies, amounted to 936 million yen loss, compared with 67 million yen profit for the ninemonths ended December 31, 2017. The components of fundamental profit were 2,075 million yen
in mortality margin, 2,998 million yen loss in expense margin and 13 million yen loss in interest
margin.
(2) Financial condition
Assets, liabilities and net assets
Total assets as of December 31, 2018 amounted to 37,334 million yen (35,541 million yen asof March 31, 2018). The major account balance was 30,239 million yen in securities mainly
consisting of government bonds and corporate bonds with high credit ratings.
Liabilities amounted to 25,027 million yen as of December 31, 2018 (22,153 million yen as ofMarch 31, 2018), owing to an increase in policy reserves. The major account balances were
23,719 million yen in policy reserves and 335 million yen in reserves for outstanding claims.
Net assets decreased to 12,306 million yen as of December 31, 2018 (13,387 million yen asof March 31, 2018), by recording the net loss.
The solvency margin ratio as of December 31, 2018 was 2,191.7% (2,455.8% as of March
31, 2018), which indicated that an adequate level of payment capacity was maintained.
Cash flows
For the nine months ended December 31, 2018, net cash provided by operating activities
amounted to 1,923 million yen (2,798 million yen provided for the nine months ended December
31, 2017) despite increased of operating expenses. Net cash used by investing activities
amounted to 2,675 million yen (3,102 million yen used for the nine months ended December 31,2017) mainly due to acquisition of securities. Net cash used by financing activities amounted to
13 million yen (14 million yen used for the nine months ended December 31, 2017).
Based on these activities described above, cash and cash equivalents as of December 31,
2018 totaled 2,160 million yen (2,926 million yen as of March 31, 2018).

Copyright© LIFENET INSURANCE COMPANY All rights reserved.

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NEWS RELEASE(3) Business forecasts
The business forecasts for fiscal 2018 which was announced on November 12, 2018 remainunchanged as shown below. Expecting annualized premium*1 of new business will be 2,600
million yen, we aim to achieve the record high in new business on a fiscal year basis.
(In millions of yen)
Net income (loss)

Ordinary income

Ordinary profit (loss)

Business forecast(Fiscal 2018)

12,600(1,600)(1,600)[Reference]
Results (Fiscal 2017)

10,962

(197)

(249)

*1: Annualized premium is the amount of money equivalent to what is to be paid to have the insurance coverage for one
year. All payments for Lifenet products are in monthly installments, we calculate annualized premium as multiplying
the monthly premium by 12 months.

About LIFENETURL: https://ir.lifenet-seimei.co.jp/en/

Remembering the original purpose of life insurance - mutual support - LIFENET INSURANCE
was founded with the goal of offering simple, convenient and competitively priced products andservices based on the highest levels of business integrity. We sell these products and services
directly to customers over the Internet. We aim to be the leading company driving the growth ofthe online life insurance market.
Contact:
Investor Relations, Corporate Planning DepartmentTel:+81-3-5216-7900
e-mail: ir@lifenet-seimei.co.jp
Disclaimer: This is a summarized translation of the original Japanese document, prepared and provided
solely for readers' convenience. In case of any discrepancy or dispute, the Japanese document prevails.

Copyright© LIFENET INSURANCE COMPANY All rights reserved.

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NEWS RELEASE
2. Non-consolidated Financial Statements(1) Balance Sheets(In millions of yen)March 31,
Dec. 31,
2018
2018
ASSETSCash and deposits ·································································

926

960

Monetary claims bought ··························································

1,999

1,199

Money held in trust ································································

2,567

3,015

Securities ············································································

28,30330,239Government bonds····························································

8,398

8,022

Municipal bonds ·······························································

1,505

1,381

Corporate bonds ·······························································

13,892

16,086

Stocks ············································································

346

341

Foreign securities ·····························································－

45

Other securities ································································

4,161

4,362

Tangible fixed assets ······························································

109

87

Intangible fixed assets ····························································

621

642

Agency accounts receivable ····················································

4

6

Reinsurance accounts receivable ··············································

45

78

Other assets·········································································

964

1,103

Accounts receivable ··························································

802

924

Other ·············································································

162

178

Total assets ···························································

35,54137,334

LIABILITIESPolicy reserves and other ························································
Reserves for outstanding claims ··········································

21,18624,055429

335

Policy reserves ·································································

20,75723,719Agency accounts payable ·······················································

59

73

Reinsurance accounts payable ·················································

108

138

Other liabilities ······································································

581

581

Reserves under the special laws ···············································

30

40

Reserve for price fluctuations ··············································

30

40

Deferred tax liabilities ·····························································

186

138

Total liabilities ·························································

22,15325,027

Capital stock ········································································

12,136

12,136

Capital surplus ······································································

12,136

12,136

Retained earnings ·································································(11,365)(12,323)

Shareholders’ equity ················································

12,907

11,950

Valuation difference on available-for-sale securities ······················

480

356

Valuation and translation adjustments ········································

480

356

Total net assets ······················································

13,387

12,306

Total liabilities and net assets ·····································

35,54137,334

NET ASSETS

Copyright© LIFENET INSURANCE COMPANY All rights reserved.

4NEWS RELEASE(2) Statements of Operations

Ordinary income····························································
Insurance premiums and other ····································
Premiums income ·················································
Reinsurance income··············································
Investment income ····················································
Interest, dividends and other income ·························
Gains on money held in trust ···································
Gains on sales of securities ····································
Other ordinary income ···············································
Reversal of reserves for outstanding claims ················
Other ·································································
Ordinary expenses ························································
Insurance claims and other ·········································
Insurance claims ··················································
Benefits ······························································
Other refunds ······················································
Reinsurance commissions ······································
Provision for policy reserves and other ··························
Provision for reserves for outstanding claims ··············
Provision for policy reserves ···································
Investment expenses ·················································
Interest expenses ·················································
Operating expenses ··················································
Other ordinary expenses ············································
Ordinary profit (loss) ······················································
Extraordinary losses ······················································
Provision of reserves under the special laws ···················
Provision of reserve for price fluctuations ···················
Income (loss) before income taxes ····································
Income taxes-current ·····················································
Income taxes ································································Net income (loss) ··························································(In millions of yen)
Nine months ended Dec. 31
2017
2018
8,071
9,359
7,867
8,949
7,718
8,706
149
243
180
292
167
167
13
26
－
98
23
117
－
93
23
23
8,082
10,303
1,426
1,950
761
1,105
434
498
0
0
231
347
2,737
2,962
47
－
2,690
2,962
0
0
0
0
3,484
4,850
434
540
(11)
(944)
8
9
8
9
8
9
(19)
(954)
23
3
23
3
(42)
(957)

Copyright© LIFENET INSURANCE COMPANY All rights reserved.

5NEWS RELEASE(3) Statements of Cash Flows(In millions of yen)
Nine months ended Dec. 31
2017Cash flows from operating activities
Income (loss) before income taxes ··································

2018
(954)

Depreciation and amortization ········································

(19)
188

Increase (decrease) in reserves for outstanding claims ········

47

(93)

Increase (decrease) in policy reserves ······························

2,690

2,962

Increase (decrease) in reserve for price fluctuations ············

8

9

Interest, dividends and other income ································

(167)

(167)

Loss (gain) related to securities ·······································

－

(98)

Interest expenses ························································

10

Decrease (increase) in agency accounts receivable ············

(0)

(2)

Decrease (increase) in reinsurance accounts receivable ·······

(25)

(33)

Decrease (increase) in other assets <excluding assets for investing and financing activities> ··

(52)

(104)

Increase (decrease) in agency accounts payable ····················

0

14

Increase (decrease) in reinsurance accounts payable ··········
Increase (decrease) in other liabilities <excluding liabilities for investing and financing activities>·····························································································································
Other,
net ···············································································································································
Subtotal ·····································································

36

29

187

(99)

63

(12)

(26)

2,595

1,787

Interest and dividends income received ····························
Interest expenses paid ··················································

202
(1)

179
(0)

Income taxes paid ························································

1

(43)

Net cash provided by (used in) operating activities ·········

2,798

1,923

Cash flows from investing activities
Purchase of money held in trust ······································(1,200)(400)

Purchase of securities ···················································(4,302)(3,788)Proceeds from sales and redemption of securities ··················

2,670

1,727

Total of net cash provided by (used in) investment transactions(2,832)(2,460)Total of net cash provided by (used in) operating activities and investment transactions
Purchase of tangible fixed assets ····································
Purchase of intangible fixed assets ··································Net cash provided by (used in) investing activities ··········

(33)

(537)

(21)
(248)
(3,102)(25)(189)(2,675)

Cash flows from financing activities
Repayments of lease obligations ·····································

(14)

(13)

Net cash provided by (used in) financing activities ·········

(14)

(13)

Net increase (decrease) in cash and cash equivalents ·············

(318)

(765)

Cash and cash equivalents, beginning of the year ···················

3,004

2,926

Cash and cash equivalents, end of the period ··························

2,686

2,160

###

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