NEWS RELEASE
February 9, 2018
Daisuke Iwase, President
LIFENET INSURANCE COMPANY(Securities Code: 7157, TSE Mothers)

Financial Results for 3Q of Fiscal 2017 Ending March 31, 2018
24.7% increase in annualized premium of new business
TOKYO, February 9, 2018 - LIFENET INSURANCE COMPANY (TSE Mothers 7157,
President Daisuke Iwase, URL: http://ir.lifenet-seimei.co.jp/en/) discloses financial results for thethird quarter of fiscal 2017 ending March 31, 2018.
1．Overview of the financial results for 3Q of fiscal 2017
(1) Business results
Condition of policies-in-force
Annualized premium*1 of new business in 3Q ended December 31, 2017 was 460 million yen(143.7% of 3Q of fiscal 2016). The number of new business was 10,555 (151.2% of 3Q of fiscal
2016). Annualized premium*1 of new business for the nine months ended December 31, 2017
was 1,191 million yen (124.7% of the nine months ended December 31, 2016). The number of
new business for the nine months ended December 31, 2017 was 26,997 (131.1% of the ninemonths ended December 31, 2016).
Annualized premium *1 of policies-in-force as of the end of 3Q of fiscal 2017 stands at 10,796
million yen (107.0% of March 31, 2017). The number of policies-in-force resulted in a total of
255,614 (106.6% of March 31, 2017). Surrender and lapse ratio*2 for the nine months ended
December 31, 2017 was 5.9% (6.5% for the nine months ended December 31, 2016).
*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, 2017 increased to7,867 million yen (107.5% of the nine months ended December 31, 2016) due to an increase in
the number of policies-in-force. Investment income was 180 million yen (112.4% of the ninemonths ended December 31, 2016). Other ordinary income was 23 million yen. As a result,ordinary income for the nine months ended December 31, 2017 amounted to 8,071 million yen(106.6% of the nine months ended December 31, 2016).
Insurance claims and other was 1,426 million yen (103.0% of the nine months ended December
31, 2016). The ratio of insurance payment amounts to insurance premiums decreased to 15.5%
for the nine months ended December 31, 2017, compared with 16.7% for the nine months ended
December 31, 2016. Provision for policy reserves and other came to 2,737 million yen (99.4% of
the nine months ended December 31, 2016). The ratio of provision for policy reserves toinsurance premiums was 34.9% for the nine months ended December 31, 2017, compared with
38.5% for the nine months ended December 31, 2016. Operating expenses amounted to 3,484
million yen (128.4% of the nine months ended December 31, 2016) mainly due to active
investment in marketing expenses including advertising. The components of operating expenses
were 1,741 million yen in marketing expenses (159.6% of the nine months ended December 31,2016), 509 million yen in customer service expenses (119.3% of the nine months ended
December 31, 2016), and 1,232 million yen in system and other expenses (103.1% of the nine
Copyright© LIFENET INSURANCE COMPANY All rights reserved.

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NEWS RELEASE
months ended December 31, 2016). Other ordinary expenses was 434 million yen (37.4% of thenine months ended December 31, 2016) since the amortization of deferred assets under Article
113 of the Insurance Business Act is no longer recorded by the one-time amortization in theprevious fiscal year. Consequently, ordinary expenses for the nine months ended December 31,
2017 totaled 8,082 million yen (100.8% of the nine months ended December 31, 2016).
As a result, ordinary loss totaled 11 million yen for the nine months ended December 31, 2017,
compared with 447 million yen for the nine months ended December 31, 2016. Net loss was 42
million yen, compared with 424 million yen for the nine months ended December 31, 2016.
In addition, fundamental profit, which is an indicator for the profitability of life insurancecompanies, amounted to 67 million yen, compared with 381 million yen loss for the nine months
ended December 31, 2016. The components of fundamental profit were 1,941 million yen inmortality margin, 1,875 million yen loss in expense margin and 1 million yen in interest margin.
(2) Financial condition
Assets, liabilities and net assets
Total assets as of December 31, 2017 amounted to 35,263 million yen (31,934 million yen asof March 31, 2017). The major account balance was 28,083 million yen in securities mainly
consisting of government bonds and corporate bonds with high credit ratings.
Liabilities amounted to 21,515 million yen as of December 31, 2017 (18,288 million yen as ofMarch 31, 2017), owing to an increase in policy reserves as a result of the increased insurance
premiums. The major account balances were 19,880 million yen in policy reserves (including
1,482 million yen in contingency reserves), and 359 million yen in reserves for outstanding
claims.
Net assets was 13,747 million yen as of December 31, 2017 (13,645 million yen as of March
31, 2017).
The solvency margin ratio as of December 31, 2017 was 2,534.1% (2,723.0% as of March 31,2017), which indicated that an adequate level of payment capacity was maintained.
Cash flows
For the nine months ended December 31, 2017, net cash provided by operating activities
amounted to 2,798 million yen (3,069 million yen provided for the nine months ended December
31, 2016) due to an increase in insurance premiums and other. Net cash used by investing
activities amounted to 3,102 million yen (3,385 million yen used for the nine months ended
December 31, 2016) mainly due to acquisition of securities. Net cash used by financing activities
amounted to 14 million yen (204 million yen provided for the nine months ended December 31,2016).
Based on these activities described above, cash and cash equivalents as of December 31,
2017 totaled 2,686 million yen (3,004 million yen as of March 31, 2017).

Copyright© LIFENET INSURANCE COMPANY All rights reserved.

2

NEWS RELEASE(3) Business forecasts
The business forecasts for fiscal 2017 remain unchanged as shown below. This will be
disclosed ordinary income, ordinary profit (loss) and net income (loss).
(In millions of yen)
Ordinary income
Ordinary profit (loss)
Net income (loss)
Business forecasts(Fiscal 2017)

11,000

(300)

(300)

(Reference)
Results (Fiscal 2016)

10,096(2,031) *1(1,889) *1*1

Amortization of the deferred assets under Article 113 of the Insurance Business Act was 2,120 million yen due to the
one-time amortization in fiscal 2016. The ordinary profit before amortization of deferred assets under Article 113 of the
Insurance Business Act was 88 million yen.

About LIFENET URL: http://ir.lifenet-seimei.co.jp/en/
Returning to 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. By using the Internet, we are able to offer highly
cost-competitive products and accept applications from customers at any given time.
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,
2017
2017
ASSETSCash and deposits ·································································

1,004

1,186

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

1,999

1,999

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

995

2,283

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

26,372

28,083Government bonds····························································

9,876

8,380

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

1,496

1,500

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

11,751

13,872

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

334

338

Foreign securities ·····························································

819

866

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

2,095

3,124

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

123

104

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

502

595

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

1

2

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

30

56

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

904

950

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

742

782

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

161

168

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

31,93435,263

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

17,501

20,239311

359

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

17,18919,880Agency accounts payable ·······················································

39

40

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

68

105

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

469

857

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

19

27

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

19

27

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

189

246

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

18,28821,515

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

12,136

12,136

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

12,136

12,136

Retained earnings ·································································(11,116)(11,159)

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

13,157

13,114

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

488

632

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

488

632

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

13,645

13,747

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

31,93435,263

NET ASSETS

Copyright© LIFENET INSURANCE COMPANY All rights reserved.

4NEWS RELEASE(2) Statements of Operations(In millions of yen)
Nine months ended Dec. 31
2016
2017
Ordinary income······························································
7,568
8,071
Insurance premiums and other ····································
7,321
7,867
Premiums income ·················································
7,163
7,718
Reinsurance income··············································
157
149
Investment income ····················································
160
180
Interest, dividends and other income ·························
160
167
Gains on money held in trust ···································－
13
Other ordinary income ···············································
86
23
Reversal of reserves for outstanding claims ················
73－
Other ·································································
1223
Ordinary expenses ························································
8,016
8,082
Insurance claims and other ·········································
1,384
1,426
Insurance claims ··················································
798
761
Benefits ······························································
399
434
Other refunds ······················································
0
0
Reinsurance commissions ······································
187
231
Provision for policy reserves and other ··························
2,754
2,737
Provision for reserves for outstanding claims ··············－
47
Provision for policy reserves ···································
2,754
2,690
Investment expenses ·················································
0
0Interest expenses ·················································
00
Losses on money held in trust ·································
0－
Operating expenses ··················································
2,714
3,484
Other ordinary expenses ············································
1,162
434
Ordinary profit (loss) ······················································
(447)
(11)
Extraordinary losses ······················································
4
8
Provision of reserves under the special laws ···················
4
8
Provision of reserve for price fluctuations ···················
4
8
Income (loss) before income taxes ····································
(452)
(19)
Income taxes-current ·····················································
27
23
Income taxes-deferred ····················································(56)－
Income taxes ································································(28)
23
Net income (loss) ··························································
(424)
(42)

Copyright© LIFENET INSURANCE COMPANY All rights reserved.

5NEWS RELEASE(3) Statements of Cash Flows(In millions of yen)
Nine months ended Dec. 31
2016

2017

Cash flows from operating activities
Income (loss) before income taxes ·····································

(452)

(19)

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

180

188

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

(73)

47

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

2,754

2,690

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

4

8

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

(160)

(167)

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

01

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

(0)

(0)

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

(8)

(25)

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

749

(52)

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

18

0

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

9

36

Increase (decrease) in other liabilities <excluding liabilities for investing and financing activities > ·

(70)

(99)

Other, net ······································································

1

(12)

Subtotal ········································································

2,953

2,595

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

228
(0)

202
(1)

Income taxes (paid) refund ················································

(111)

1

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

3,069

2,798

Cash flows from investing activities
Purchase of money held in trust ·········································－(1,200)Purchase of securities ······················································(4,410)(4,302)

Proceeds from sales and redemption of securities ······················

1,300

2,670

Total of net cash provided by (used in) investment transactions ···(3,110)(2,832)

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 ·············

(40)
(36)
(238)
(3,385)

(33)
(21)
(248)
(3,102)

Cash flows from financing activities
Proceeds from issuance of stock resulting from exercise of subscription rights to shares ···213－

Repayments of lease obligations ········································

(8)

(14)

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

204

(14)

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

(110)

(318)

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

2,734

3,004

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

2,623

2,686

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6