Presentation Material for
Business Plan and Growth Potential

July 2023
LIFENET INSURANCE COMPANY

Copyright© LIFENET INSURANCE COMPANY All rights reserved.

0Table of Contents

I.

Company Overview and Business Model

II.

Japanese Life Insurance Industry Trends

Ⅲ.

FY2022 ResultsⅣ.

Growth Strategy

Ⅴ.

Risk Information

Copyright© LIFENET INSURANCE COMPANY All rights reserved.

1Lifenet is…
◼ Lifenet’s management philosophy is helping our customers embrace life more fully by offering comprehensible, costcompetitive and convenient products and services based on the highest levels of business integrity.
◼ With the internet as our main sales channel, we utilize technology and strive to be the leading company driving the
growth of the online life insurance market through our customer-centric products and services.

Comprehensible

Cost-Competitive
Convenient

Copyright© LIFENET INSURANCE COMPANY All rights reserved.

2

Lifenet’s Mission◼ Customer’s pain points related to life insurance are lying all stage from when they search insurance to claim benefits.
◼ Based on LIFENET Manifesto “Comprehensible, Cost-Competitive, Convenient”, we aim to cope with these pain points
by providing better products and services, while staying close to each customer.

Customer’s pain points at each touchpoint
SearchConsult

Manage

Apply•

Negative image forthe life insurance industry•

Products are complicated••

Review

Claim

Premiums are expensive
Procedures are difficult

LIFENET Manifesto

Comprehensible, Cost-Competitive, Convenient

Copyright© LIFENET INSURANCE COMPANY All rights reserved.

3

LIFENET Manifesto◼ The Lifenet Manifesto is our guiding principles for our company since business commencement.

Comprehensible, Cost-Competitive, ConvenientI.

II.

Our Guiding Principles(1) Creating the future of the life insurance without losing sight of its original
premise: “an ounce of prevention is worth more than a pound of cure.”(2) Listening to what our customers are saying. Recognizing their needs andacting accordingly. Allowing our actions to be borne out of their voices andneeds.
(3) Delivering the caliber of products and services that we would feel confident
recommending to our own friends and families.
(4) Being a “straight-shooter”. Committing to transparency. Communicating
openly about our management team, our products, and our employees.
(5) Embracing diversity and dialogue to keep us abreast of changing needs
and preferences. Delivering peace of mind that we’ll be around in 100
years.
(6) Acting in good faith means always taking the high road when it comes tocompliance and ethics.

III.

Making Life Insurance Accessible Again - Affordable(1) Giving the customer what he/she needs. No more, no less at a fair price.
(2) Staying vigilant as to how we can provide our products more costefficiently.
(3) Always putting ourselves in our customers’ shoes in thinking about how tominimize their premiums.

Making Life Insurance Accessible Again - Headache-free(1) Helping the customers help themselves. By making our materials easy tounderstand, customers can determine which coverage is truly the best fit.
(2) Turning “clauses” in the insurance contract into succinct points that yourgrandmother could grasp.
(3) Making all touch points headache-free. Beyond the application process,ensuring the claims and billing processes are also easy to understand.

IV.

Making Life Insurance Accessible Again - Convenient(1) Thinking about our customers’ convenience from every angle and every
touch point along the way.
(2) Forming alliances with like-minded partners who can add value above andbeyond our products and services to our customers.
(3) Providing health and wellness tips beyond the framework of life insurance
to create value in our policyholders’ lives.
(4) Creating a precedent for future generations as to what life insurance is(and should be) all about.

We wish to be a company that helps our customers embrace life more fully.
In order to live out that vision, we continue to challenge ourselves.

Copyright© LIFENET INSURANCE COMPANY All rights reserved.

4Lifenet at a Glance
History

Stock Information•

Oct. 2006

Established•May 2008

Commenced operation•

Mar. 2012 Listed on Tokyo Stock Exchange,
Mothers
May 2015

Issuance of new shares through thirdparty allotment to KDDI CORPORATION•

Jul. 2020

Issuance of new shares by way ofinternational offering•

Sep. 2021 Issuance of new shares by way ofinternational offering•

Apr. 2022 Transited to Tokyo Stock Exchange,
GrowthKey Figures (FYE 2023/3)•

Tokyo Stock Exchange, Growth– Market of the high growth and emerging stocks•

Ticker:•Total number of authorized shares:•

Total number of issued shares:•

Number of Shareholders: 5,569 (as of Mar. 31, 2023)

7157
200,000,000

69,736,419 (as of Mar. 31, 2023)••

Annualized Premiums1of Policies-in-force:•

Number of Policies-in-force:•

Sum insured:•

Premium and Other Income：

JPY 29,207mn•

Total Assets:

JPY 68,600mn•

Net Assets:

JPY 15,574mn•

Embedded Value：

JPY 124,666mn•

Number of Employees：－Sales Representative：•
1.

Major Shareholders (as of March 31, 2023)

Solvency Margin Ratio：

JPY 24,033mn
568,674
JPY 3,633,704mn

208
03,158%•

au Financial Holdings Corporation

18.35%•GOLDMAN SACHS INTERNATIONAL

13.95%•

Custody Bank of Japan, Ltd.(Trust Account)

5.16%

•

Seven Financial Service Co., Ltd.

4.66%

•

GOLDMAN,SACHS & CO.REG

3.52%

•

BNY GCM CLIENT ACCOUNT JPRD AC ISG (FE-AC)

3.47%

•

STATE STREET BANK AND TRUST COMPANY 505103 2.97％•

STATE STREET BANK AND TRUST COMPANY 510312 2.47％•

THE BANK OF NEW YORK 133652

2.31％

•

Tachibana Securities Co., Ltd.

2.28％

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, thus the annualized premium is calculated as multiplying the monthly premium by 12 months.
Copyright© LIFENET INSURANCE COMPANY All rights reserved.

5

Management Team (as of June 25, 2023)◼ Management team is comprised of individuals of various backgrounds across a wide age range from 30s and 60s.
Directors

Yasuhiro Koba

Ryosuke Mori
Representative Director and President
Goldman Sachs Japan Co., Ltd.
Head of Corporate Planning Department and General Manager
of Corporate Strategy Division at Lifenet

Ryosuke Kondo
Director
Executive Officer of Sales & Marketing Division
and Data Science Promotion OfficeJAPAN POST INSURANCE CO., Ltd.
Head of Corporate Planning Department and Executive Officer ofCorporate Planning, Product Development and Investment at Lifenet
Director, LIFENET MIRAI INC.

Director, Executive Vice President
Executive Officer of Business Development Department,
Product Development Department, Creditor Insurance
Business Department and Investment Department
Ministry of Health, Labour and Welfare
Head of Legal Department, General Manager of Corporate
Administration Division and General Manager of Sales & Marketing
Division at Lifenet

Junpei Yokozawa

Director
Executive Officer of Information Systems Strategy Division
NTT DATA Net’s CORPORATIONHead of KDDI Business Department and head of Operations
Planning Department at Lifenet

Jun Hasebe

Takeshi Saito

OutsideRepresentative Director and President,
Tokyo Relations Inc.

OutsideSenior Managing Director and Chief Financial Officer,
au Financial Holdings Corporation

Directors (Audit and Supervisory Committee Member)
Takahiro Yamasaki
Full-time
Nippon Life Insurance Company
Nippon Venture Capital Co., Ltd.
Full-Time Audit and Supervisory board member at Lifenet
Corporate Auditor, LIFENET MIRAI INC.

Keiko Hayashi
OutsideProfessor, Faculty of Commerce Graduate School of Accountancy,
Waseda University

Tomoyuki Yamashita

Emima Abe

OutsideRepresentative Director and President,
Aon Solutions Japan Ltd.

OutsideAttorney, Miyamasuzaka the Firm Law & Accounting Office

Copyright© LIFENET INSURANCE COMPANY All rights reserved.

6

Business Model with Manifesto

High integrity◼ Actively disclose relevant information◼ Communicate with customers proactively

Comprehensiveness◼ Provide very simple and pure protection products◼ Develop easy-to-understand and customer friendly website

Cost-Competitiveness◼ Offer competitively priced products by Internet-based low cost operation

Convenience◼ Provide convenient services utilizing smartphones◼ All procedures provided online, from applying to claiming benefits

Copyright© LIFENET INSURANCE COMPANY All rights reserved.

7

Management with High Level of Business Integrity◼ We provide life insurance online and at the same time, we put emphasis on transparency and disclose ourmanagement, products, employees, and workplace through our website.
Transparent disclosure

Transparent Company• Disclosure of insurance premiums• Regular policyholder meetings• Disclosure of agent commission rates• Introduce our workplace through Lifenet Journal Online• Disclosure of monthly operating figures• Diverse employee backgrounds(half of employees from other industries)

Net premium

2,000yen(74%)

Expense loading

704yen(26%)

Premium
Expenseloading

Lifenet JOURNAL Online including employee’s blog

Term life Kazoku
E.g. 30 years old, male,insurance term 10 years,
insurance coverage amount 30 million yen

Premium

Net premium

Disclosure of breakdown of insurance premium (example)（Net premium＋Expense
loading）

2,704yen(100%)(As of June 30, 2023)

https://media.lifenet-seimei.co.jp/(Japanese version only)
Copyright© LIFENET INSURANCE COMPANY All rights reserved.

8

Simple Products◼ We offer simple and competitively priced pure protection products. Internet-based low cost operations enable us
to be extremely price competitive.
◼ We have provided competitively priced term life, which is our main product. We offer industry-first coverage3 forlong-term disability. Cancer Insurance has a broad range of coverage.

Long-term
Disability
Hataraku-Hito 3

Term Life
KazokuFor death due to illness, accident or disaster

Whole-life
MedicalJibun 3For hospitalization, surgery
and advanced medical care

For being unable to work
due to disease or injuries

Whole-life Medical
Jibun 3for Women
For more extensive coverage for womenCancer
Double Yell
For double support of treatment
and income decreases
1.
2.
3.

Our products have no maturity insurance, no dividends and no cash surrender value on our products.
As of June 2023, we offer au Life Insurance with Ponta Point through KDDI CORPORATION, Seven Financial Service Life Insurance through Seven Financial Service Co.,
Ltd. and Money Forward Life Insurance through Money Forward, Inc.
Lifenet Research as of the end of April 2021
Copyright© LIFENET INSURANCE COMPANY All rights reserved.

9

Develop Easy-to-understand and Customer Friendly Website (e.g. Quotes)◼ We are striving to provide a stress-free customer experience through a series of improvement activities toenhance the UI/UX from the customer's perspective.

SelectbirthdaySelectproducts

Select sex

Total monthly
premium
All customers need to do to get quotes isselect birthday, sex and insurance
products

Calculated on June 30, 2023

Copyright© LIFENET INSURANCE COMPANY All rights reserved.

10

Competitively Priced Products◼ We do not have sales representatives or branches for selling insurance. We use the Internet to sell our products.
This enables us to provide products with inexpensive insurance premiums.

Structure of premium(Life insurance)

Savings of insurance premium1
after switching to Lifenet

Average annual saving
88,536 yen
・Office costs

Load
Charge・Personnel costs

・Utility costs
・Other costs

・Personnel costs

Averagemonthly
premium
15,573yen

・Utility
Othercosts
costs
・Other costs

1.

Net premiums(Used forinsurance
payouts andother payments)

Netpremiums

Face-to-facesalesLifenetAveragemonthly
premium

8,195
yen
BeforeswitchingAfterswitching2021 survey results of the “Customer-oriented business management policy” by Lifenet（N＝326）. Average annual cost saving does not take into
account any changes in scope of insurance coverage.
Copyright© LIFENET INSURANCE COMPANY All rights reserved.

11

Pursuing Convenience◼ We are striving to provide the convenience that only an online insurance company can provide. We use technology
to establish an environment that enables customers to request insurance consultation, apply for insurance, andclaim benefits 24 hours a day, 365 days a year, as it fits into their lifestyles.
Provide convenient services by utilizing smartphones

Insurance
Consultation•

Using LINE enables
customers to seek
consultation on insurance
via chat.

（Launched in Jul. 2016)
1.

Application•

A paperless application
process that customers cancomplete by submitting
photos of necessary
documents（Launched in Dec. 2016)

Procedures while
enrolled in a policy•

Enable to log-in to My Page,
using fingerprint and facerecognition technology

Claim payments••

Medical certification
submission no longer
necessary for mostmedical claims1
Claim medical insurance
benefits online, 24 hours
a day, 7days a week

（Launched in Jun. 2018)

It is possible to omit the medical certification submission only for medical insurance. The submission is required under certain conditions.

Copyright© LIFENET INSURANCE COMPANY All rights reserved.

12External Evaluations◼ Our products and services are well supported by customers and receive high evaluations.

Awarded in FY2022
J.D. Power 2023 Japan Life Insurance
Contract Customer Satisfaction Study＜Direct Segment＞1

1st

for 3rd consecutive year
Lifenet’s Insurance Products
Ranked 1st2

1.
2.
3.

Lifenet's Contact Center and Website
Awarded 3 Stars for the 10th Time,the Industry Record3

The 2023 study is based upon the responses of 1,280 policyholders who have purchased new life insurance policies or renewed a policy during past 12 months.
https://japan.jdpower.com/awards
The most popular insurance products in the category from January through December 2022, receiving the highest number of applications of Kakaku.com
Insurance, the sales agent company of insurance products.
The Most Chosen Insurance Ranking 2023 of HOKEN ICHIBA is based on compiled date from the number of application from January through December 2022.
The 2022 HDI Benchmarking (Life Insurance Industry) in two categories: “Phone Support (Contact Center)” and “Web Support (Website)”
Copyright© LIFENET INSURANCE COMPANY All rights reserved.

13

Unique Customer Base
◼ New customers in their 20s to 40s consist of 74% of our policyholder base, with more than 50% of newpolicyholders taking out life insurance for the first time.
Number of new policies by age group

Customer Situation3

We are attracting younger customers and building a good
customer base from a medium- to long-term perspective.

The share of households taking out life insurance forthe first time accounted for the majority, despite thepercentage of households holding policies being 90%.

Lifenet1

Ratio of 20s to 40s

7%
21%

19%

74%

Additional or switching policies
by existing Lifenet’s customers

27%

26%

Supplementing existing cover 7%

17%

40-49
50-59

14%
18%

12%

60-

Taking out life insurance
for the first time

53%

30-39

19%

53%

by different insurance

-19
20-29

Reference: Industry average2

First time

Switching fromdifferent insurers

23%

19%
19%

1.
2.
3.

Lifenet Insurance new customer data (FY2022, N = 98,532) compiled by Lifenet customer survey.
Annual statistics on customer age and gender (FY2021) compiled by The Life Insurance Associationof Japan. Based on number of new policies.
FY2022 valid responses of 1,634.

Copyright© LIFENET INSURANCE COMPANY All rights reserved.

14

Table of Contents

I.

Company Overview and Business Model

II.

Japanese Life Insurance Industry Trends

Ⅲ.

FY2022 ResultsⅣ.

Growth Strategy

Ⅴ.

Risk Information

Copyright© LIFENET INSURANCE COMPANY All rights reserved.

15

Life Insurance Market in Japan◼ Japan's life insurance market is huge and it worth approximately JPY 38 trillion.
◼ We believe there is a high need for life insurance. There were around 12.9 million new enrollments in fiscal 2022
despite approximately 90% of Japanese households have already taken out life insurance.

Market size by industry in Japan1

38.0 trillion yen

LifeinsuranceBank
Telecommunications
business
Conveniencestore
Non-life
insurance

23.3 trillion yen
15.2 trillion yen

11.1 trillion yen

Ratio of householdswith policies2:

89.8%
Average annual
premiums
per household2:

JPY 371 thousand

8.8 trillion yen

Number of new policies
for fiscal 20223:

12.9 million
1.

2.
3.

life insurance: Insurance premiums and other, bank: Ordinary income, telecommunication business and convenience store: operating revenue, non-life insurance: Net
premiums written. Annual statistics (FY2022) compiled by The Life Insurance Association of Japan, Financial Statements Statistics of Corporation by Industry (fiscal
2021) compiled by Ministry of Finance, The Basic Survey Result for information and communications industry (FY2020) compiled by the Ministry of Internal Affairs andCommunications and Ministry of Economy, Trade and Industry, Convenience store FC statistics compiled (2022) by Japan Franchise Association, Data by insurance type
(FY2021) compiled by The General Insurance Association of Japan.
Data for FY2021 compiled by a nationwide report on the life insurance industry (2021) by Japan Institute of Life Insurance.
Annual statistics by The Life Insurance Association of Japan (2022)
Copyright© LIFENET INSURANCE COMPANY All rights reserved.

16

Individual Insurance Market◼ Japan’s life insurance industry has 194 million policies-in-force in the individual insurance.
◼ Term-Life, Whole-Life, Medical and Cancer Insurance account for a large part of the life insurance market.

The Industry and Lifenet’s Number of
Policies-in-force

Number of Policies-in-force by Coverage
Type in the Life Insurance Market

Japanese individuallife insurance market1

194mm

2

OthersTerm-Life

40mm

28 mm

Whole-Life with Term 5mm
Medical

Educational 6mm

44 mm

Endowment 9mm

Lifenet’s number ofpolicies-in-force2

0.5mm

1.
2.

Whole-Life

Cancer

37 mm

25 mm

Annual statistics by The Life Insurance Association of Japan (2022)“May 2023: MONTHLY DISCLOSURE” by Lifenet
Copyright© LIFENET INSURANCE COMPANY All rights reserved.

17

Trend of Customer’s Purchasing Channel and Intention◼ Sales representative accounts for a large proportion of life insurance’s purchasing channel.
◼ On the other hand, the figure shows that preferred purchasing channels are diversifying while online channel andinsurance agent channel are increasing.
Preferred Purchasing
Channels in the future1

Trends of Purchasing Channels1
1.5
3.1

4.4
3.1

18.0

16.9

7.0

Online0.3
9.9

Unknown

10.2

11.3

7.6

9.4

11.8

49.7

2013年
2013

18.0

14.9

Japan
Agricultural
Cooperatives

9.0

Post office, Bank,
Securities brokers

14.9

Insurance agents

33.0

In-house
sales
representatives

2022年
2022

(year)

45.9

2019年
2019

2016年
2016

2022年
2022

Others（加入意向）

1.

Survey on Life Protection by the Japan Institute of Life Insurance
Copyright© LIFENET INSURANCE COMPANY All rights reserved.

18

Group Credit Life Insurance Market◼ The outstanding balance of mortgage loans in Japan has been increasing and amounted to JPY 210 trillion at the endof FY2021.
◼ In the market for group credit life insurance（GCL)1 which Lifenet will newly enter from FY2023, the four major life
insurers have a 60% share of the market and foreign life insurers have 20% share.
Trends of Mortgage Loans Outstanding2

176

178

180

181

183

186

190

195

Share of Group Credit Life Insurance3
200

205

210 trillionyen

Sum insured of policies-in-force of GCL
as the end of FY2021

210 trillion yen

OthersLife insurers 19%
with ecosystem
3%

Foreign life
insurers
17%

2011
1.
2.
3.

2013

2015

2017

2019

Four
major
大手生保4社
life insurers
61%
61%

2021

About the group credit life insurance policy, the creditor of the mortgage loan including bank is a policyholder and an insurance beneficiary, and the borrower receiving
the mortgage loan from the bank is an insured person.
Government Housing Loan Corporation, 'Results of Survey on New Mortgage Loans and Outstanding Loans by Type of Business'.
Lifenet Research
Copyright© LIFENET INSURANCE COMPANY All rights reserved.

19

Table of Contents

I.

Company Overview and Business Model

II.

Japanese Life Insurance Industry Trends

Ⅲ.

FY2022 ResultsⅣ.

Growth Strategy

Ⅴ.

Risk Information

Copyright© LIFENET INSURANCE COMPANY All rights reserved.

20

In-Force Business Growth◼ Annualized premiums and number of policies-in-force corresponding to the annual recurring revenue amounted to
JPY 24 billion and 568,674 respectively at the end of March 2023.
◼ Both annualized premium and the number of policies-in-force are record highs, representing over double-digit growthfrom the end of the previous fiscal year.
: Annualized premium of policies-in-force1 (JPY billions): Number of policies-in-force

24.0

21.5

568,67418.7
507,42815.5
13.0

439,945◼ Year-on-year
annualized premium
111.7%,
number ofpolicies-in-force
112.1%

365,171

308,8542018 4Q
2019/031.

2019 4Q’20/032020 4Q’21/03◼ Achieved continuous
double digit growth2021 4Q’22/032022 4Q （YY/MM）’23/03

The amount of money equivalent to what is to be paid to have the insurance coverage for one year. All payments are monthly installments, thus the annualized
premium is calculated as multiplying the monthly premium by 12 months.
Copyright© LIFENET INSURANCE COMPANY All rights reserved.

21

Strong EEV1 Growth◼ EEV and value of in-force business have been growing at a CAGR of 19%2 and 32%, respectively since IPO.
◼ EEV per share has also steadily increased.

¥1,788¥1,673: Value of in-force business (JPY millions)¥1,570: Adjusted net worth (JPY millions)¥1,430: EEV/share (JPY)¥1,239124,666

116,604

95,14073,431
91,43563,378106,299

76,149¥441

48,51860,87818,547
5,122
13,425

14,86012,55318,99025,16818,367

2012/03 ’13/03 ’14/03 ’15/03 ’16/03 ’17/03 ’18/03 ’19/03 ’20/03 ’21/03 ’22/03 ’23/03 (YY/MM)
1.
2.

Lifenet’s EEV is calculated following the EEV Principles and Guidance and in terms of allowance for risk, MCEV Principles (The European Insurance CFO Forum Market
Consistent Embedded Value Principles©) is referred. From fiscal 2016 onward, a predetermined ultimate forward rate has been used to extrapolate the level of ultralong-term interest rates past the last liquid data point. This method of extrapolation has also been used to restate EEV as of March 31, 2016.
The calculation includes JPY 3,040 million in proceeds from a third-party allotment in May 2015 and JPY 9,005 million from overseas public offering in July 2020 and JPY
9,771 million from overseas public offering in September 2021.
Copyright© LIFENET INSURANCE COMPANY All rights reserved.

22

COVID-19 Claims Condition◼ Due to the spread of COVID-19 infections, payment of insurance claims and benefits related to COVID-19 increased
and it was JPY 1.37 billion for FY2022.

The amount of COVID-19 claims
Total actual results from April 2022 to March 2023
approx.

JPY

1.37 billion

September 26
Revised the requirements of
COVID-19 claims：Actual results

Claims for the seventh wave

Claims for the sixth wave

Jan.

Feb.
FY2021

Mar.

Apr.

May

Jun.

Jul.

Aug.

Sep.

Oct.

Nov.

Dec.

Jan.

Feb.

Mar.

FY2022

Copyright© LIFENET INSURANCE COMPANY All rights reserved.

23

FY2022 Business Forecasts and Results◼ Annualized premium1 of policies-in-force increased by 11.7% from the end of FY2021 to JPY 24.0 billion, continuing
double-digit growth.
◼ Ordinary income and net income were lower than the business forecasts given at the beginning of FY2022, mainly
due to COVID-19 related payments for FY2022 totalling JPY 1.37 billion.

（JPY millions）

1.

FY2022 Forecasts

FY2022 Forecasts（As of May 2022)（As of Nov. 2022）

FY2022 Results

Annualized
premium ofpolicies-in-force

24,40024,30024,033

Annualized
premium of
new business

4,400

4,200

3,919

Of which:
impactof modified
co-insurance

Of which:
impactof modified
co-insurance

Of which:
impactof modified
co-insurance

Ordinary income

30,300

6,300

30,0005,900

30,268

5,671

Ordinary profit(loss)(3,400)1,000(5,000)800(4,949)608

Net income (loss)(3,400)1,000(5,000)800(5,164)608

The amount of money equivalent to what is to be paid to have the insurance coverage for one year. All payments are monthly installments, thus the annualized
premium is calculated as multiplying the monthly premium by 12 months.
Copyright© LIFENET INSURANCE COMPANY All rights reserved.

24Summary of FY2022◼ The main initiatives and summary of performance for FY2022 are as follows.

Business Growth•

Achieved continuous double-digit growth of in-force business while affected by
COVID-19 situation•

Increased EEV steadily despite of the negative impacts by deterioration in efficiency,
COVID-19 claims, rising interest rate and inflation
Initiatives for the future•

Prepared various initiatives with partners to achieve sustainable growth over themid- to long-term•

Established a subsidiary in FY2021 with the goal of becoming an online life insurance
platform. The number of products covered by the insurance comparison website“betterChoice” has been expanded to approximately 60.
Financial Reporting•

Resolved the voluntary adoption of IFRS from FY2023

Copyright© LIFENET INSURANCE COMPANY All rights reserved.

25

Table of Contents

I.

Company Overview and Business Model

II.

Japanese Life Insurance Industry Trends

Ⅲ.

FY2022 ResultsⅣ.

Growth Strategy

Ⅴ.

Risk Information

Copyright© LIFENET INSURANCE COMPANY All rights reserved.

26

MissionBe the leading company driving the growthof the online life insurance market

Management goal

Priority
areas

Help our customers embrace life more fully
by offering comprehensible, cost-competitiveand convenient products and services

VisionManagement Policy• Innovation of customer experience

Enhancing and evolving the quality of all services with digital technology• Enhancement of promotion capabilities

Generating massive customer traffic by active promotion and expansion of
agent sales and white label business

Aim to achieve EEV (European Embedded
Value) of 200 billion yen by business growth
in a mid-term
Copyright© LIFENET INSURANCE COMPANY All rights reserved.

27

Growth Potential of Online Life Insurance Market◼ The growth potential of the online life insurance business is steadily expanding with the structural megatrend ofdigitization of financial services, and the percentage of those intend to purchase online has accelerated over the last 3
years.
◼ We also see the growing intention of people of all age groups to purchase life insurance online as a strong tailwind forthe expansion of the online life insurance market.

Further increasing intentions to purchase policy online
with COVID-19 as opportunity1

Penetrating wide range of generations1
Change in intention to purchase online
by age group over the last 3 years

Latestsurveyresults

18.0%: Year 2019
: Year 2022

21.3%

Ratio of respondents who have intention to purchase online
Ratio of respondents who purchased online

20.5%
18.2%

18.0%

10.9
12.0%

COVID

5.9

12.2%

13.1%

12.3%
11.1%

4.4%

6.5%

2.8
1.0

2010

1.

2013

2016

2019

2022 (year)

20’s
20代

30’s
30代

40’s
40代

50’s
50代

60’s
60代

Source: Survey on Life Protection by the Japan Institute of Life Insurance
Copyright© LIFENET INSURANCE COMPANY All rights reserved.

28

Competitive Landscape◼ There are three major stages in the process of the birth and expansion of a new market: (1) a period when a small
number of players develop the market, (2) a period when the market expands as more players compete with eachother, and (3) a period when a small number of winning players enjoy the fruits of the expanded market.
◼ We believe that the current state of the online life insurance market is Phase2. Therefore, we will continue to invest in
growth to maintain and strengthen the competitive advantage we have built up to date and to further solidify ourposition as the number one online life insurance company.

Phase1

Phase2Market development

Competition by new entrants

Phase3
Narrowing down toa few main companies

Expansion of online life insurance market and Lifenet’s position(Image for illustrative purpose）

Keep the position by
aggressive investment though
efficiency deteriorates due tothe competition

Become a dominant
player in the market

Reaped the merit
as a pioneer
Business
Commencement

Present

Copyright© LIFENET INSURANCE COMPANY All rights reserved.

Future29

Growth Loop Leveraging No.1 Position◼ Lifenet’s brand, superior UI/UX, and unique position as a leading online life insurance company have led to attractions
from powerful partners and others seeking to build a financial economic zone with embedded insurance business.
◼ We believe that our uniqueness lies in its growth loop, in which the expansion of this partner business will further
accelerate the growth of the online life insurance market, which in turn will accelerate the scale of our business.

Unique positioning
as No.1 online insurer

Increasing
opportunities
with partners

Embedded insurance
business with partners
creating ecosystem
Online life
insurance

Selfreinforcing

Expanding online
insurance market

Copyright© LIFENET INSURANCE COMPANY All rights reserved.

30

Individual Insurance◼ We aim to re-accelerate the growth of the Internet direct channel in the mid-term and adapt to the changing
behavior of customers over time, including the younger generation.
◼ In the partner business channel, we will actively work with partners to leverage our strength as a leading player of
online life insurance.

Internet direct channel

Partner business channel

Adapt to customers’ needs that change withthe time period centering on younger generation

Further grow in the mid-term with broadcustomer base and strong brand of partners

Marketing/
Promotion

Web/App

SNS

CRM

Payments

Telecommunications

RetailHealthcare
Internet
services

Products
Copyright© LIFENET INSURANCE COMPANY All rights reserved.

31

Group Credit Life Insurance◼ Lifenet began offering group credit life insurance to mortgage loan customers of au Jibun Bank from July 1, 2023, as
the first group credit life insurance business since our business commencement.
◼ This initiative in the group credit life insurance business is a new challenge and a new step toward further enhancing
corporate value through the expansion of our business domain.

Initiative

Start offering group credit life insurance to au Jibun Bank’s
mortgage borrowers from July 1st, 2023

Online Mortgage Loans

In approx. 6 years and
11 months, the amountexceeded JPY 2.5 tn.

Group Credit Life Insurance• Change au Jibun Bank’s
underwriting insurer of existinggroup credit life insurance
policies to Lifenet• Provide products and services
with utilizing online business

Copyright© LIFENET INSURANCE COMPANY All rights reserved.

32

Platform Business◼ With the aim of becoming an online life insurance platform, Lifenet established a subsidiary, LIFENET MIRAI Inc.,in FY2021.
◼ LIFENET MIRAI aims to expand the scale of its business as an online insurance agency by working to improve the
UI/UX of the online insurance comparison website.
◼ Furthermore, starting in FY2023, LIFENET MIRAI aims to offer new systems and digital tools necessary for online
insurance business to corporate clients.

to Consumer (individuals)

to Business（corporate）

Further development of UI/UX
as online platform

Provision of system and digital tools for
operating online insurance businessSubsidiary

LIFENET MIRAI Inc.

virtuous
cycle

non-financial
companies

Service to manage insurance policy

financial
institutions

Price comparison website

Service to make to-do list relatedwith money and insurance

Copyright© LIFENET INSURANCE COMPANY All rights reserved.

33

Mid-term Growth Path
◼ In the individual insurance business, we intend to take our Internet direct channel to another level to reaccelerate
growth in the medium term. We also intend to further improve the contribution to our business performance by
expanding our partner business channels.
◼ In addition, we will steadily grow the group credit life insurance business as our new revenue base.

Group credit life insurance
Steadily grow as new revenue base andconsider expansion of alliance partners
2023

Launch GCL1

Individual insurance

2021

Accelerate growth of core Internet directchannel and expand Partner business channelStartplatform
business

2016

2008
Start Internet directchannel for individuals

FY2008
1.
2.

FY2013

Launch white label
business with partners

Annualized
premium2
JPY

24bn

Expand business domains

FY2018FY2022FutureGroup credit life insurance
Annualized premium of policies-in-force
Copyright© LIFENET INSURANCE COMPANY All rights reserved.

34

Purpose of IFRS Adoption1◼ We adopt IFRS 17 in our financial reporting from FY2023.
◼ The voluntary adoption of IFRS can better reflect our actual periodic profit/loss and profitability, for example, byallowing a part of cost acquired new business to be deferred over the period of the contract. We believe that it willcontribute to disclose more useful information to shareholders and investors.

Statutory accounting(J-GAAP)

Useful for investors’decision-making• Conservative• Historical locked-inassumptions at
policy inception• Best estimate basedon experience• Review periodically• Best estimate basedon experience• Review periodically

The expense isrecognized at the time ofacquisition.

The expected profit for thepolicy period isimmediately recognized.

The expected profit isallocated over the termof the policy.

Policyholder protection

Evaluation of
insurance liabilities
Timing ofprofit recognition(impact of new businessacquisition)

IFRS 17

Economic value of
insurance policies

Main objective(policy reserves)

Embedded value/
Value of new businessprofit・・・・

present
value ofprofitprofit
・・・・

loss

1.

Capital adequacy and dividends will be regulated by statutory accounting standards (J-GAAP) even after the adoption of IFRS
Copyright© LIFENET INSURANCE COMPANY All rights reserved.

35

Key Indicators◼ With the change in financial reporting to IFRS, we will use “European Embedded Value””Annualized premium ofpolicies-in-force””Insurance service results” as key indicators in our discussions with shareholders and investors.

1.

Corporate Value

European Embedded Value（EEV）

GrowthAnnualized premium ofpolicies-in-force1

Profitability

Insurance service results（IFRS）

Annualized premium of policies-in-force is the figures for individual insurance and group credit life insurance combined. 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.
Copyright© LIFENET INSURANCE COMPANY All rights reserved.

36

FY2023 Consolidated Business Forecasts◼ We forecast annualized premium of policies-in-force for individual insurance and group credit life insurance combinedof 28,500 million yen, insurance service results of 8,200 million yen, and net income attributable to owners of parentof 5,300 million yen.

GrowthProfitability

Annualized premium of policies-in-force1(JPY millions)(Business forecast）

24,033Group
Individual approx. 2,600
approx. 1,9002023/03

2.
3.

(Business forecast)

28,500

8,200

6,618

2024/03

FY2022

FY2023

FY2022 Results2

FY2023 Forecasts3

Annualized premium of policies-in-force1

24,03328,500Insurance revenue

20,732

24,900Insurance service results

6,618

8,200

Net income attributable to owners of parent

3,575

5,300

(JPY millions)1.

Insurance service results (JPY millions)

Annualized premium of policies-in-force is the figures for individual insurance and group credit life insurance combined. 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.
unaudited figures
The business forecasts for fiscal 2023 includes the impact of group credit life insurance business which starts in July 2023.
Copyright© LIFENET INSURANCE COMPANY All rights reserved.

37

IFRS Major Accounts in Past Years1◼ As a reference, we have disclosed data for the past five fiscal years for major IFRS items. We believe that this will
provide shareholders and investors with a certain level of understanding of the changes over time.
FY2018(JPY millions)

FY2019FY2020

FY2021

FY2022IFRS PL
Insurance service results

4,885

5,419

6,606

7,216

6,618

Insurance revenue

10,56012,55015,22017,987

20,732

Insurance service expenses

5,509

7,038

8,468

10,42913,874

Reinsurance results

(165)

(92)

(144)

(341)

(239)

-

-

-

-

(435)

-

-

-

-

(822)

-

5,360

2

Financial results
Other results

Profit before tax
Net income attributable toowners of parent

No- retrospective
calculation
-

-

-

-

3,575

-

-

-

71,87175,71622,97944,835

55,10365,73674,907

3,536

4,813

8,908

7,690

6,879

Increase from interests

309

461

595

640

710

Assumption change, etc.

21,497

9,293

6,369

6,597

7,508

Amortization of CSM(3,486)(4,300)(5,241)(5,757)(6,401)

CSM, end of the year

44,835

55,10365,73674,907

83,604

5,225

7,484

8,339

9,854

10,390

2,070

2,386

2,761

3,480

4,049

IFRS BS
Equities
CSM, beginning of the year
New business CSM

OthersInsurance acquisition cash flows3
Maintenance costs
1.
2.
3.
4.

4

Each figure from FY2018 to FY2021 is the result based on calculation of historical figures in the process of retroactive calculation and is unaudited. The figures in FY2022
haven’t been audited
Total of investment results from financial assets, insurance finance results and reinsurance finance results
Insurance acquisition cash flows incurred in the period
Maintenance costs are the costs directly related to fulfilling contracts and not included in insurance acquisition cash flows
Copyright© LIFENET INSURANCE COMPANY All rights reserved.

38

Future Direction◼ In FY2023 and beyond, in addition to re-accelerating the growth of the Internet direct channel over the mid-term,
we aim to expand business areas such as the group credit life insurance business.
◼ Through these efforts, in addition to aiming to achieve high profit growth of continued 10% growth in insurance
service results, we aim to move to the TSE prime market by around FY2025.
◼ We will also aim to achieve our management goal of JPY 200 billion in EEV as early as possible.

FutureFY2023 and after• Re-accelerate Internet
direct channel growthin the mid-term
FY2022• Expand businessdomains• Deteriorated
efficiency ofInternet directchannel• Continue 10% growth
in insurance service
results• Announced new
business alliancesincl. group credit
life insurance
1.

• Achieve EEV of
JPY 200 billion(Management Goal)• Aim to change to thePrime Market
segment1 in around
FY2025

We currently has not yet met the criteria for listing TSE Prime Market and total profit for recent years needs to be at least JPY 2.5 billion yen. Lifenet aims to fulfil thecriteria under IFRS for the two years of total profits in FY2023 and FY2024, and to move to the TSE Prime Market.
Copyright© LIFENET INSURANCE COMPANY All rights reserved.

39

Table of Contents

I.

Company Overview and Business Model

II.

Japanese Life Insurance Industry Trends

Ⅲ.

FY2022 ResultsⅣ.

Growth Strategy

Ⅴ.

Risk Information

Copyright© LIFENET INSURANCE COMPANY All rights reserved.

40

Risk Classification◼ We categorize 27 risks into "business strategy risks," "insurance underwriting risks," "market risks, credit risks andliquidity risks," and "operational risks”. Of these, the risks that are of particular significance in terms of their impact ifthey occur and possibility of occurrence are as follows.
Category

A. Business strategy risks

B. Insurance underwriting risks

C. Market risks, credit risks andliquidity risks

D. Operational risks

Major Risks

Severity

A-1 Competition in the life insurance industry
A-2 Investment in marketing expenses〇

A-3 Change in relationship with, or performance of business partners
A-4 Demographic movements in Japan
A-5 Climate change
A-6 General sustainability matters
A-7 Change in regulations
A-8 Change in social security system
A-9 Failure of other life insurance companies
A-10 Reputation in the online life insurance industry
A-11 Significant acceleration of IT innovationーB-1 Change in Mortality and morbidity

〇

B-2

ー

Accumulation of policy reserves

C-1 Change in interest rates

〇

C-2
C-3
C-4
C-5

Reinsurance transactions
Change in stock price, foreign exchange rates and others
Credit risks related to corporate bonds
Liquidity risksー

D-1 System failures
D-2 Violation of laws and ethical deviation from social norms
D-3 Information leakage

〇

D-4
D-5
D-6
D-7
D-8
D-9

ー

Business continuity amid catastrophes
Administrative risks
Misses on claim benefits payment
Human resource employment
Litigation
Risk management system

Copyright© LIFENET INSURANCE COMPANY All rights reserved.

41

Major Risks（1/3）◼ Our inherent risks in the operation of life insurance business and our measures to the risks are as follows.
Priority High
(Occurrence and severity)

Major risk

■Competition in the life insurance industry
In the Japanese life insurance market, Lifenet faces
intense competition with domestic and foreignaffiliated life insurance companies as well as large
domestic financial institutions with insurance
subsidiaries.
If we are not able to maintain our competitive
advantages in the Internet direct channel, which is
our main sales channel, the number of new businessdeclines and the number of policies-in-force declines
due to surrender, which could have an adverse effecton the Lifenet’s business and our financial
performance.

■Investment in marketing expenses
The Company actively engages in various types ofadvertising campaigns, such as TV commercials andsearch-linked advertisements, with the aim ofincreasing awareness and acquiring new business.
If sales activities are not sufficiently effective or
properly conducted, or if consumer behavior forpurchasing insurance products online is not as
widespread as we anticipate, marketing expenses
efficiency may decrease, which could have an
adverse effect on the Lifenet’s business and ourfinancial performance.

Measures

With the digitization of financial
services and the spread of the
COVID-19 pandemic,
life insurance companies with faceto-face channel promote online
operations partially, thus new
players are entering the market.
We believe that competitiveenvironment is likely to become
severer as the online life insurance
market expands.

We design and develop our products
and services from the customer's
perspectives to increase customer
engagement and maintain ourcompetitiveness based on the LIFENET
Manifesto.
Taking advantages of our experience
to date, we will maintain andstrengthen the competitiveness wehave built up in the online life
insurance market by aggressively
investing in marketing expenses,
promoting partner business channels,
implementing group credit term anddeveloping online platform through a
subsidiary, LIFENET MIRAI, etc.

There are a variety of short-termand long-term factors that
influence changes in customer
needs and trends in thesocioeconomic environment, whichconstantly affect the change inmarketing expenses efficiency.
If we fail to appropriately respondto those factors in our products,
services and marketing activities,
even if we continue to invest in
marketing expenses at the current
level, there is possibility that new
business performance deteriorates
and appropriate productprofitability is not maintained.

The Company will make decisions on
the investment in marketing expenses
while regularly monitoring andanalyzing the balance between thegrowth of new business and marketing
expense efficiency.
Through those controls we believe wewill be able to reduce the risks related
to the investment in marketing
expenses.

Copyright© LIFENET INSURANCE COMPANY All rights reserved.

42

Major Risks（2/3）
Major risk

■Change in Mortality and morbidity
Life insurance premiums are calculated based on
actuarial assumption for premium such as expectedmortality rate, expected morbidity rate, expectedsurrender rate, and expected operating expense rate.
Thus, for example, actual mortality rate may become
higher than expected mortality rate, or may increase
from historical mortality experience, which could
cause higher claims payment than we expect.

■Change in interest rates
The Company mainly holds public and corporate
bonds with high credit ratings as its primary meansof asset investment.
If market interest rates rise significantly in the future,
the market value of our bonds may decline beyond
our expectations.
In addition, the value of future cash flows of
insurance policies and EEV (European Embedded
Value) or economic value-based capital, whichreflects these future cash flows and represents
corporate value, are also affected by changes ininterest rates.
If market conditions were to fluctuate significantly
beyond our ability to cope with, our financial
condition and results of operations could be adversely
affected.

Priority High
(Occurrence and severity)

MeasuresIn the event of mass casualties due to a
massive outbreak of an infectious
disease beyond the COVID-19 pandemic
or a catastrophe such as an earthquake,tsunami, or terrorist attack in a densely
populated area like Tokyo or Osaka, theCompany is exposed to the risk of large
unpredictable obligations related toinsurance benefits and claims.
On the other hand, in light of current
trends in national mortality rates andmorbidity of diseases and disabilities, we
believe that the likelihood of such an
outbreak is low at this time.

We design appropriate coverage
and underwriting methods at thetime of product development toensure that mortality andmorbidity rates do not exceed
appropriate ranges.
The Company also regularly
monitor mortality and morbidity
rates and other experiences andcan revise underwriting methods
and products as necessary.
Also, stress tests are conducted toconfirm the impact and response in
the event of a large-scale disaster.

Inflation advances globally and theWestern countries raised their policy
interest rates amid the current
significant changes in the world
economy and international politicalsituation under the influence of the
COVID-19 pandemic and the situationin Ukraine.
Under these circumstances, werecognize that the probability ofinterest rate fluctuations has increased.
We believe that we are well capitalized
at present and that the impact ofinterest rate fluctuations is limited interms of economic value due to our
product portfolio, which is centered onprotection-type products.

We set risk limits for market risk
including interest rate risk andregularly monitor their status. We
review asset investment policies asnecessary.
Based on the financial andeconomic movement, we are
currently executing duration
shortening of bonds and portion
shift of holding purpose categoryon accounting from available-forsale to held-to-maturity with theaim to control the interest rate risk
and to enhance the tolerance on
financial accounting.

Copyright© LIFENET INSURANCE COMPANY All rights reserved.

43

Major Risks（3/3）
Priority High
(Occurrence and severity)

Major risk

■System failures
The Company relies on the stable operation of its
information systems to conduct its business
operations, including the sales, underwriting, policy
management and the recording and storage ofstatistical data and customer information.
Accidents, disasters, power outages, userconcentration, human error, sabotage, unauthorizedinternal or external access, virus infection or network
intrusion, external denial-of-service attacks, softwareor hardware malfunctions and other factors could
cause our information systems to fail. Problems may
also arise in the renewal of the information system.
In these cases, we could lose opportunities and pay
additional costs.

We have not experienced any
large-scale system troubles since
our business commencement, andwe have been operating oursystem stably. While we believethat the likelihood of large-scale
system problems due tounforeseen causes is low in the
future, it exists in the samemanner as other financial
institutions.

In addition, these can cause situations where wehave to suspend services to customers, claim
payments, premium receipt and investment
operations. As a result, there is possibility to cause
the deterioration of customer trust and company
reputation, and to lead to administrative measures,
which could have an adverse effect on the Lifenet’s
business and our financial performance.

Measures
The Company has established basic
policy and measures for the stable
operation of information systems in
its internal regulations, anddevelops information systems,
monitors their operational status,
maintains backup systems, andtakes measures in the event of
failures based on these regulations.
In addition, in preparation for
external attacks, etc., we preventand monitor unauthorized intrusion
and abuse through firewalls andanti-virus software, etc., diagnose
software vulnerabilities, andoperate a CSIRT (Computer
Security Incident Response Team)to ensure an appropriate responsein the event of an emergency.

※The information in this section does not cover all risks.
For other risks, please refer to “Business and Other Risks” in the Annual Securities Report (Japanese version only).

Copyright© LIFENET INSURANCE COMPANY All rights reserved.

44

Appendix

Initiative for Sustainability◼ We place importance on the concept of mutual support in terms of sustainability.
◼ We have identified Materiality (key sustainability issues) based on the concept of mutual support, the original purposeof life insurance.

https://ir.lifenet-seimei.co.jp/en/sustainability/materiality.html
Copyright© LIFENET INSURANCE COMPANY All rights reserved.

46

Annualized premium growth & Initiatives◼ Due to various initiatives, in-force business has increased steadily since we first commenced business.
Launched au Life Insurance with Ponta Point
Business Alliance with Sumitomo Mitsui Card

24,033
Capital & Business Alliance with Eisai
Launched New Long-term Disability

Annualized premium of policies-in-force (million yen)

21,511Business Alliance with Money Forward
Business Alliance with
Seven Financial Service

18,713

Renewal of
Whole-life Medical
Paperlessapplication process
Launched
au Life Insurancewith KDDI

Business
Commencement

IPO & Listing on
the TSE “Mothers”

8,793

Renewal ofTerm Life

CancerInsurance

13,085

11,147

Capital & Business Alliance with KDDI

Started application
via smartphone

15,514

10,088
9,377

8,077
6,875

4,870

Launched
Long-term Disability

2,659
Expense loading
rates disclosed 1,041

Jun.
Sep.
Dec.
Mar.
Jun.
Sep.
Dec.
Mar.
Jun.
Sep.
Dec.
Mar.
Jun.
Sep.
Dec.
Mar.
Jun.
Sep.
Dec.
Mar.
Jun.
Sep.
Dec.
Mar.
Jun.
Sep.
Dec.
Mar.
Jun.
Sep.
Dec.
Mar.
Jun.
Sep.
Dec.
Mar.
Jun.
Sep.
Dec.
Mar.
Jun.
Sep.
Dec.
Mar.
Jun.
Sep.
Dec.
Mar.
Jun.
Sep.
Dec.
Mar.
Jun.
Sep.
Dec.
Mar.
Jun.
Sep.
Dec.
Mar.

247

FY2008FY2009FY2010FY2011FY2012FY2013

FY2014FY2015FY2016FY2017

Copyright© LIFENET INSURANCE COMPANY All rights reserved.

FY2018FY2019FY2020

FY2021

FY202247

Appropriation of Funds Raised through Overseas Public Offering
Summary of Overseas Public Offering in September 2021
Number of
Shares Offered
AmountRaised9,000,000 shares

JPY 9.7 billion

Amount Raised（JPY millions）

Amount
Allocated（JPY millions）
As of Mar. 2022

Amount
Allocated（JPY millions）
As of Mar. 2023

Operating expenses, primarily
comprising marketing expenses foracquiring new business

6,800

680

1,500

System development costs aimed at
responding to business environmentchanges

1,372

46

100

Investments in new businesses aimed
at building an online insurance
platform and initiatives with Lifenet’s
business partners

1,500

3

700

Contents

Use ofProceeds

Applicable
PeriodBetween the fiscal year ending 31 March 2022 and the fiscal year ending 31 March 2026

Copyright© LIFENET INSURANCE COMPANY All rights reserved.

48

Profit Structure under Current Statutory Accounting◼ Typically, large expenses are incurred when life insurance policies are acquired (1). However, because the profit isearned over a long period of time, there is a time lag between the recognition of costs and revenue. (2)◼ In other words, the greater the growth in new business, the greater the negative impact on current period profits (3),thus necessary to look at embedded value (EV) to evaluate the corporate value of a life insurance company as it is anindicator of long-term profitability.

: Premiums: Operation expenses1 excluding marketing expenses: Marketing expenses

Accounting
profit/loss (3)Initialfiscal year
初年度

Year 22年目

Year 33年目

Year 44年目

Insurance premiums
are revenue that isrecognized over a long…time (2)period ofYear X
X年目

Revenue
ExpenseMarketingexpenses

The expenses incurred to acquire new businessare mostly recognized in the initial fiscal year.
The greater the growth in new business, thegreater the increase in costs (1)Economic Value

Long-term profitability must be considered.
1.

Costs for policy management, payment of insurance claims and benefit claims, etc.
Copyright© LIFENET INSURANCE COMPANY All rights reserved.

49

Structure of Embedded Value◼ Embedded value is the indicator of long-term profitability, and is the sum of adjusted net worth and value of inforce business.
◼ The value of in-force business is the future profit stream that will likely be derived from current policies,
discounted to present value.
◼ Profit/loss for the current fiscal year is reflected in end-of-period net assets. In general, an increase in new
business contributes to the increase in the value of in-force business in the period.

EV

Adjusted
net worth

Value of in-force
business(Net assets at end of period + adjustments)

Profit/loss for thecurrent fiscal year isreflected in end-ofperiod net assets

Revenue

Revenue
ExpenseExpenseProfit/Loss for
current fiscal year

Unrealized future profits/losses on policies-in-force
at the end of current fiscal year

Copyright© LIFENET INSURANCE COMPANY All rights reserved.

50

This material is based on information as of June 2023.
All information on this document that is not historicalfact constitutes forward-looking information and isbased on assumptions and forecasts available to thecompany at the time of preparation. The company
cannot guarantee the accuracy of these assumptions
and forecasts. Earnings projections and otherinformation on this may differ materially from actual
performance due to various risks and uncertainties.
The next disclosure of Presentation Material for
Business Plan and Growth Potential is scheduled forJune 2024.

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

Subscribe to our "IR email service" to receive
news releases and website updates via email.

Contact:
Investor Relations, Corporate Planning Departmente-mail: ir@lifenet-seimei.co.jp