Annual Report

2022

Year Ended March 31, 2022

Asahi Mutual Life Insurance Company

Table of Contents

1. Message from the President …………………………………………………………………………………………………………… 2
2. Mid-term Management Plan “Advance: The road to 2030” ………………………………………………………………………… 8
3. Business Overview ……………………………………………………………………………………………………………………… 9
4. Business Overview for Fiscal Year 2021 ………………………………………………………………………………………………10
Business Performance ……………………………………………………………10
Financial Performance ……………………………………………………………12
Financial Soundness ……………………………………………………………12
Results of Operations ……………………………………………………………14
Assets, Liabilities and Net Assets ………………………………………………15
Non-Financial Highlights…………………………………………………………16
5. Investments ………………………………………………………………………………………………………………………………18
Investments (General Account) …………………………………………………18
Responsible Investment Initiatives ……………………………………………19
6. Multiple Channel System ………………………………………………………………………………………………………………21
Overview of the Sales Representative Channel ………………………………21
Overview of Other Channels ……………………………………………………21
7. Addressing the Recommendations of the Task Force on Climate-related Financial Disclosures (TCFD) ………………………22
Governance ………………………………………………………………………22
Strategy ……………………………………………………………………………22
Risk Management…………………………………………………………………23
Metrics and Targets ………………………………………………………………24
8. Governance Structure ……………………………………………………………………………………………………………………25
Corporate Governance …………………………………………………………25
Board of Representative Policyholders …………………………………………26
Promoting Compliance …………………………………………………………26
Protecting Customer Information ………………………………………………27
Risk Management Structure ……………………………………………………27
Ofﬁcers (as of July 5, 2022) ………………………………………………………28
9. Consolidated Financial Statements ……………………………………………………………………………………………………29
10. Non-consolidated Financial Statements ……………………………………………………………………………………………60
11. Company Overview (as of March 31, 2022) …………………………………………………………………………………………90

1

1. Message from the President

In this era of the 100-year lifespan, we aim to be a company
that contributes to resolving social issues and continues tosupport customers’ lives through the life insurance business
Introduction

Hiroki Kimura

President andRepresentative Director

2Asahi Mutual Life Insurance Company Annual Report 2022

Thank you for supporting Asahi Life.
Since our founding in 1888, Asahi Life has grownalongside the growth and development of theJapanese economy with the warm support of ourmany customers. It is thanks to you that we welcome
our 135th anniversary in March 2023. We are deeply
grateful for all of your support over these many years.
The life insurance industry plays an importantrole in supporting Japanese society in cooperation
with the social security system, and we believethat the company’s business operations themselves
are deeply important and constitute a social
responsibility. Based on these beliefs, Asahi Lifeholds a basic management philosophy of “Sincere
Service” that is guided by the idea that fulfilling our
responsibilities to our customers, society, and our
employees is fundamental to our business.
Additionally, on the basis of the following
priorities, Asahi Life engages in sustainable
management mindful of the sustainability of society
itself.
“Engaging in business that prioritizes the
improvement of customer satisfaction”“Co-existence with society through continued
engagement to create a prosperous society”“Improvement of employee satisfaction throughthe creation of a comfortable workplace that fosters
employees”
Through above initiatives and appropriate
cooperation with various stakeholders, Asahi
Life aims to contribute to the achievement of asustainable society.

1. Message from the President

Financial Results for the Fiscal Year
Ended March 31, 2022 (FY 2021)
Financial results for the year ended March 31, 2022
were marked by strong sales in the medical insurance
and nursing care insurance businesses at Asahi
Life, while life insurance subsidiary Nanairo Life
Insurance Co., Ltd. which began selling insurance in
October 2021, saw steady growth in new policies. As
a result, annualized premiums from new policies forprotection-type products at Asahi Life Group beat theprevious year, reaching 107.9% year-on-year.
In terms of earnings and financial soundness of
Asahi Life, fundamental profit grew from the previous
year to 47.7 billion yen, and the solvency margin
ratio (metric for solvency with respect to claims andbenefits) remained at 954.9%, the same level as theprevious year and more than 200%, the level insurancecompanies are required to maintain.
In summary, Asahi Life had a good year in termsof insurance business performance, earnings andfinancial soundness.

Mid-term Management Plan
“Advance: The road to 2030”
We expect big, rapid-acting changes to affect thebusiness environment in the years ahead as Japan’s
super-aged society takes root, society undergoes rapid
digitalization, and initiatives are put into action toachieve a sustainable society.
In order to address these sorts of changes, themid-term management plan launched in FY 2021

(ended March 31, 2022) focuses on three strategies:
the “Third-sector (Products/Services) Strategy,” the“Channel Strategy,” and the “Investment Strategy.”
In addition, there are two growth drivers to support
these strategies: the “DX*1 Strategy” and the “Human
Resources Strategy.” Through these strategies, wewill work to push forward our initiatives currently
underway and create new areas of growth.
The quantitative metrics identified as strategic
targets in the mid-term management plan are steadily
increasing across the board. Of these, the FY 2023
target for number of new nursing care insurance
policies for the Group has already been achieved.
*1 Digital transformation. This refers to the utilization of digitaltechnology and data to provide new products and services,
create value for customers, and gain a competitive advantage.

Three Strategies in the Mid-termManagement Plan
Third-sector (Products/Services) Strategy
u Focus on Medical Insurance and Nursing
Care Insurance
We pursued product development contributing
to pioneering in the third-sector insurance market,
especially the medical/lifestyle disease and nursing
care/cognitive impairment sectors in which we excel.
In April 2021, an “insurance policyholder agency
rider” was introduced that enables a representative
agent of a policyholder to perform certain procedureson the policyholder’s behalf in the event that thepolicyholder is rendered unable to perform those31. Message from the President

necessary procedures due to cognitive impairment orother issue that prevents them from communicating
their intent.
In October 2021, “nursing care annuity insurancewith less underwriting requirement” was introduced forsale to those who had given up the idea of enrollment innursing care insurance due to pre-existing conditions(or past illness) or other health-related concerns.
In February 2022, Asahi Life was recognized
for these efforts to address social issues such as
nursing care/cognitive impairment by the Social
Products Award 2022, hosted by the Association
for the Promotion of Social Products, where “Asahi
Life’s nursing care/cognitive impairment insurance”
received the Social Products Award.
We will continue focusing on the third-sector
insurance market, especially the medical/lifestyledisease and nursing care/cognitive impairment sectors
in which we excel. Above all, in the nursing careinsurance sector, we will exert our market presence as“the go-to company for nursing care insurance.”u Providing New Value in the Healthcare Sector
In order to better fulfill Asahi Life’s rolecomplementing the social security system to tackle
social issues such as promoting good health andprolonging the healthy lifespan, the “medication
support policy rider” was introduced for sale in
October 2021. This new insurance product for
the healthcare sector begins paying benefits at the
medication stage to support prolonged treatments.
Additionally, we launched the “kencom×insurance
for Okusuri (medicine) support” app for “medication
support policy rider” policyholders to help support
those customers’ health-promotion activities as wellas early treatment and warding off the worsening ofpatients’ conditions.
By continuing to provide unique products and4Asahi Mutual Life Insurance Company Annual Report 2022

services such as support for the early treatment ofdiseases and prevention of the worsening of lifestylediseases to a state requiring nursing care, we will
perform a complementary role to the social security
system for Japan’s super-aged society.

Channel Strategy
u Building a Strong Sales Representative
Structure
Sales representatives represent Asahi Life’s primarysales channel. In addition to our traditional forte offace-to-face sales activities, we have also incorporated
digital tools such as online meetings for explanationsof product proposals, digital formats for proposal
documents, and online applications. In this way, we
have worked to bolster our consulting activities byaddressing customers’ needs for remote solutions andimplementing COVID-19 countermeasures.
Moving forward, we will continue to push our sales
activities forward by incorporating digital technology
into our primary sales channel of sales representatives,
i.e., our forte of “face-to-face consultation that only
humans can offer.”u Promotion of a Shift to Multiple Channels
In order to accurately monitor customers’ diversifying
needs and flexibly provide third-sector products suchas medical insurance through independent agencies
and direct marketing, Nanairo Life opened business as
wholly-owned subsidiary of Asahi Life in April 2021
and began selling life insurance in October 2021.
In our independent agency channels for the
corporate market, primarily tax accountant agencies,
Asahi Life worked to grow the number of active
agencies we serve by bolstering training provided
to staff responsible for such agencies and other such
follow-up systems.

1. Message from the President

Investment Strategy

We also worked to set up internet marketing anddigital channels by which to provide products toaddress rapidly growing needs for digital solutions.
Moving forward, we will work to further enhance
our initiatives across all channels to expand ourmarket share while also implementing data-driven
marketing*2 that accumulates, analyzes, and utilizes
data to provide the products and services best suited
to customer needs.
*2 Methodologies of implementing the marketing PDCA cycle
utilizing data that has been accumulated and analyzed.

u Expansion of Overseas BusinessAsahi Life partnered with a Vietnamese insurancecompanyin2017toprovideourexpertiseontelemarketingfor medical insurance and other products, in addition toproviding a consulting services with an online businessmodel. In FY 2021, we worked to grow our businesses
by developing income protection insurance, expanding
online services to improve customer convenience, andproviding expertise on expanding the number of areas
targeted for telemarketing.
Anticipating a shrinking domestic market in the
future, we are also working to expand our insurance
business in Vietnam while also considering expansion
into other Asian countries.

In FY 2021, Asahi Life curbed investment inJapanese government bonds and similar assets due
to ongoing low domestic interest rates and opted
for a risk-avoidant strategy through diversified
investments, securing income by actively pursuing
credit investments*3 that are efficient in terms ofrisk-return in preparation for the implementation of
economic value-based regulations in 2025.
Moreover, as a responsible institutional investor and
PRI*4 signatory, we are promoting good stewardship*5
and continuing to pursue investment that incorporates
ESG (environment, social, and governance) factors.
Additionally, based on an agreement that Asahi
Life and our subsidiary Asahi Life Asset Management
have with French investment giant Natixis Investment
Managers S.A., we pursued closer cooperation on
businesses development and worked to create newinvestment opportunities.
Asahi Life will continue to aim to diversify the rangeof asset classes in which we invest to mitigate risk andsecure profits, while also aiming, as a responsible
institutional investor, to contribute to the resolution ofenvironmental issues and other global social problems
and thereby reduce investment risk and secure newincome opportunities.
*3 A way of generating revenue by investing in corporate bonds,
loans, and similar products.
*4 The Principles for Responsible Investment (PRI) are behavioral
principles advocated by the United Nations that request
institutional investors to incorporate ESG (environmental,social, and governance) issues into the decision-making
process in the interest of achieving a sustainable society.
*5 Activities in which institutional investors engage inconstructive, “purposeful dialogue” (engagement) that
includes sustainability-related factors in order to improvethe corporate value of the investee companies and promotesustainable growth, thereby growing medium- to long-term
investment returns.

5

1. Message from the President

Growth Drivers Underlying Three
Strategies
DX Strategy
We engaged in three reforms to sales channels,
products and services, and business operations toimprove the customer experience.
Specifically, we introduced online “web applications”
for insurance policies in April 2021 in order to addressincreasingly diversifying customer needs.
In July 2021, we created the Automatic Planning
System for Recommended Sales Activities*6, a system
for “Smart - Ai” tablet-type sales devices in which AI
analyzes and calculates activity recommendations forsales representatives to improve efficiency.
In October 2021, we launched a smartphone app
to help sales representatives provide useful productinformation to customers in a timely manner basedon their age, household makeup, and other factors.
By further promoting these sorts of initiatives andpushing ahead with the three reforms of sales channels,
products and services, and business operations, wewill provide customers with new additional value.
*6 System in which AI analyzes data owned by Asahi Life
(customersʼ ages, household makeup, policy descriptions,procedural data, etc.) and suggests priority targets for sales
representatives to visit.

Human Resources Strategy
In order to achieve sustainable growth based on thecore concept of “supporting the challenge of the diverse
human resources who are building the future of Asahi
Life,” we are focused on the three major themes of“developing human resources who are committed toalways striving,” “restructuring our human resources
portfolio,” and “entrenching work style reforms” by

6Asahi Mutual Life Insurance Company Annual Report 2022

having each and every staff member follow three
behavioral guidelines: “Challenging yourself,” “Careerself-reliance,” and “Improve productivity.”
Moving forward, in order to increase value forthe entire Asahi Life Group, we will further flesh out
measures pertaining to these three major themes
while also pushing ahead with strategies that promote
success for personnel throughout the Group as awhole.

Contributions to SDGs Achievement
Efforts to tackle the Sustainable Development Goals(SDGs), adopted by the United Nations as global goals
to be achieved by 2030, are picking up steam in Japan.
At Asahi Life, our mid-term management plan
“Advance: The road to 2030” lays out the following
vision for what we want the company to become by2030: “In this era of the 100-year lifespan, we aim to be
a company that contributes to resolving social issues
and continues to support customers’ lives throughthe life insurance business.” We work towards theachievement of the SDGs and provide value towards
the goal of achieving a sustainable society.
Specifically, in the life insurance business, we
provide nursing care and medical insurance products
and services towards the goal of addressing the
problems of a healthy and long-lived society. In
our investment, as well, we take into account ESG(environment, social, and governance) factors withthe aim of resolving global social issues.
As measures tackling climate change, one of ourpriorities for sustainable management, we resolved toaim to reduce greenhouse gas emissions to “net zero”
levels by FY 2050, and in March 2022, we establishedinterim CO2 reduction targets for FY 2030.
Additionally, we also worked on CSR (Corporate1. Message from the President

Social Responsibility) activities for local healthcare
and welfare, plus diversity promotion, work stylereforms, health and productivity management, andhuman rights promotion.
In order to steadily implement these initiatives
moving forward, we established a Sustainable
Management Promotion Committee in April 2022
headed by Asahi Life’s company president, and we are
pursuing deeper talks at the management level (Boardof Directors, etc.) regarding important sustainabilityrelated issues, including addressing the proposalsof the Task Force on Climate-related Financial
Disclosures (TCFD)*7.

Conclusion
Asahi Life will always think and act from theperspective and point-of-view of our customers on
the basis of our basic management philosophy of“Sincere Service,” moving forward, as in the past, we
will continue to tackle challenges and grow as we“aim to be a company that contributes to resolvingsocial issues and continues to support customers’ lives
through the life insurance business in this era of the
100-year lifespan.”
We look forward to your continued warm support
and patronage in the future.

*7 Recommendations for climate-related information disclosuresby companies and institutions and proposals for a basic
framework underlying such disclosures.

COVID-19 Countermeasures
Our deepest sympathies go out to all of thoseaffected by COVID-19.
In the interest of fulfilling the social mission of
our life insurance business, Asahi Life allows for thepartial omission of some documentation pertaining to
the payment of claims and benefits for those who areunable to provide that required documentation due
to circumstances affecting the customer or medical
institution.
Due to changing lifestyles in light of COVID-19 andin the interest of customer convenience, we also offer
online meetings for explanations of product proposals
and enable customers to conduct paperwork for new
policies online through “web applications.”
Moving forward, Asahi Life will place the highest
priority on the health and safety of our customers
and personnel as we provide services in a flexible
manner.

7

2. Mid-term Management Plan
“Advance: The road to 2030”
Asahi Life has established a three-year mid-term management plan for FY 2021 through FY 2023: “Advance:
The road to 2030.”
The achievement of a sustainable society is required on the path to 2030. Asahi Life will contribute to theachievement of such a society through our life insurance business and investment activities based on the belief
that Asahi Lifeʼs business operations themselves are deeply important and constitute a social responsibility.
Above all, as peopleʼs medical expenses and the burden of nursing care become serious social problems inJapanʼs super-aged society, we will support the efforts of our customers to help themselves in this era of the
100-year lifespan. Further, we will contribute to addressing the problems facing a society of good health andlongevity by providing the medical and nursing care insurance products and services that are Asahi Life's forte,in addition to providing value in the healthcare sector, such as for the prevention of the worsening of diseases.

CorporatevisionAsahi Life’s
Vision for2030

Supporting each and every individual life

Asahi Life: a company that contributes to resolving social issues and continues to support customers’ “life”
through the life insurance business in this era of the 100-year lifespanSustainability Management

Initiatives of the
Mid-term Management PlanThree years to create growth trajectory towards 2030
Third-sector Strategy

Channel Strategy

Investment Strategy

Providing value by leveraging
the Company's strength

Developing our sales representative
channelEstablishing multi-channel structure
Creating group synergy

Transitioning to an economic
value-based portfolio
Securing investment income
Promoting ESG investment

Nursing care
Branding

DX Strategy
Growthdrivers

Creating new value-added and a new business model

Human Resource Strategy

Supporting human resource diversity who endeavors to shape the future

Customer-oriented business operations, enhancing compliance,business management sophistication and enhanced governanceInsurance Group Strategy

Advanced Enterprise Risk Management (ERM) Structure■Progress Towards Strategic Targets
FY 2023 targets

Status at the end of FY2021

Number of customers (Group*1)

2.80 million

2.640 million (+37 thousand YoY)

New policies for protection-type products*2(Annualized prmiums, Group*1)¥35.0 billion¥26.7 billion (107.9% YoY)

Number of new nursing care insurance policies(Group*1)

117 thousand

117 thousand (118.4% YoY)

Policies in force for protection-type products*2(Annualized prmiums, Group*1)¥330.0 billion¥309.9 billion (+¥4.2 billion YoY)

*1 “Group” here refers to the total of Asahi Life and Nanairo Life.
*2 Protection-type products include death protection insurance and third sector insurance products such as medical insurance, nursing careinsurance and non-participating group medical insurance sold through the agency channel, but exclude saving-type insurance products andinsurance products for management personnel("Grand stage" and "Prime Stage").

8

Asahi Mutual Life Insurance Company Annual Report 2022

3. Business Overview
Overview
Asahi Life was established in 1888 as the second
modern life insurance company in Japan under thename Teikoku Life Insurance Company (Teikoku
Seimei Hoken Kabushiki Gaisha). We became amutual company and changed our name to Asahi
Mutual Life Insurance Company (Asahi Seimei
Hoken Sogo Gaisha) in 1947.
Our core business is life insurance for individuals
in Japan, with a specific strategic focus on offering
protection-type products, including medical andnursing care products.
We have been enhancing our financial
soundness and aim to further enhance it throughthe accumulation of surplus and recapitalization
measures. As of March 31, 2022, we had a nonconsolidated solvency margin ratio of 954.9
percent, and insurer financial strength ratings of
BBB+ (Positive Outlook) from Fitch, BBB+ (Positive
Outlook) from R&I, and BBB+ (Positive Outlook)from JCR.

Products
Asahi Life offers a variety of individual life
insurance products, with a focus on protectiontype products including medical and nursing careproducts, aimed at serving our customersʼ financial
needs. We continually review, update, and expand
our product offerings to respond to the needs of ourcustomers while maintaining our focus on individuallife insurance.
Our main products for individual customers are
flexible life insurance products named “Hokenou
Plus” targeting male customers, and “Yasashisa Plus”
targeting female customers. Each product allows
customers to choose from a portfolio of insurance
products to create a customized insurance plan.

Insurance Group Strategy
In order to precisely respond to customersʼ
diversifying needs, Asahi Life will partner with Group
companies to implement agile product development
as well as a “multi-channel” strategy that features

expanded independent agency channels, such as
insurance shops and telemarketing, in addition to
our sales representative channel.

■ Asahi Mutual Life Insurance Company
Our roughly 14,000 sales representatives throughout Japan provide face-toface service for customers. They provide thorough consultation services during theapplication process and provide extensive follow-up service to address the needsof each individual customer, such as information suited to changes in customersʼ life
cycles.
■ Nanairo Life Insurance Co., Ltd.
Established in April 2021, Nanairo Life began selling life insurance in October
2021. Primarily working through channels such as independent agencies and direct
marketing, Nanairo Life provides third-sector products such as medical insurance toaccurately and flexibly serve customersʼ diversifying needs.
■ NHS Insurance Group Inc.
NHS Insurance Group is a holding company for four insurance agencies: NHS Inc.,
Sokisha Inc., FEA Inc. and Life Navi Partners Inc. In telemarketing and door-to-doorsales, they select and suggest the insurance product that best suits the needs of eachindividual customer from a range of products offered by various insurance companies.
■ F.L.P Co., Ltd.
F.L.P is an independent agency that runs a chain of over twenty insurance shops
in the Tokyo Metropolitan Area under the brand Insurance Consultation Salon FLP.
F.L.P selects and suggests the insurance product that best suits the needs of eachindividual customer from a range of products offered by various insurance companies.

94. Business Overview for Fiscal Year 2021
Business Performance (Annualized Premiums, Group*1)
l New Policies for Individual Insurance/Individual Annuities
Annualized premiums from new policies for the Group reached 107.2% of the previous fiscal year.
Of these, third-sector products reached 110.3% of the previous fiscal year.
(Billions of Yen)
Years ended March 31
New Policies (Group)

2021

2022

Year-over-year

25.1

27.0

107.2%

Asahi Life

–

23.2

–

Nanairo Life

–

3.8

–

20.9

23.1

110.3%

Third-sector productsl Surrendered and Lapsed Policies for Individual Insurance/Individual Annuities*2
Annualized premiums from surrendered and lapsed policies for the Group reached 105.7% of the previous
fiscal year.
(Billions of Yen)
Years ended March 31

2021

2022

Year-over-year

Surrendered and lapsed policies (Group)

21.9

23.2

105.7%

Surrender and lapse ratio

4.14%

4.45%

+0.32points

l Policies in Force for Individual Insurance/Individual Annuities
Annualized premiums from policies in force for the Group ended at 98.0% of the end of the previous fiscal
year due primarily to declines in savings-type products.
Of these, third-sector products reached 102.8% of the end of the previous fiscal year.
(Billions of Yen)
As of March 31
Policies in force (Group)2022

Year-over-year

521.2

510.9

98.0%

Asahi Life

–

507.2

–

Nanairo Life

–

3.7

–

221.4

227.7

102.8%

Third-sector products

10

2021

Asahi Mutual Life Insurance Company Annual Report 2022

4. Business Overview for Fiscal Year 2021

l New Policies for Protection-type Products*3
Annualized premiums from new policies for protection-type products, a focus of Asahi Life, reached107.9% of the previous fiscal year for the Group.
(Billions of Yen)
Years ended March 31
New policies (Group)2021

Year-over-year

24.8

26.7

107.9%

–

22.9

–

17.8

18.9

106.4%–

3.8–

Asahi Life
Sales representative channel

2022

Nanairo Lifel Policies in Force for Protection-type Products*3
Annualized premiums from policies in force for protection-type products gained +¥4.2 billion on the endof the previous fiscal year for the Group, exhibiting an ongoing increasing trend.
(Billions of Yen)
As of March 31
Policies in force (Group)
Asahi Life
Sales representative channel
Nanairo Life

2021

2022

Year-over-year

305.6

309.9

+4.2

–

306.1

–

282.8

283.1

+0.3

–

3.7

–

Notes:*1. “Group” here refers to the total of Asahi Life and Nanairo Life.
*2. Surrendered and lapsed policies are measured as cancellations plus expirations and reductions less revivals.
*3. Protection-type products include death protection insurance and third-sector insurance products such as medical insurance, nursing
care insurance. and non-participating group medical insurance sold through agency channels, but exclude savings-type insurance
products and insurance products for management personnel with surrender benefits (“Grand Stage” and “Prime Stage”).

11

4. Business Overview for Fiscal Year 2021

Financial Performance (Non-consolidated)l Fundamental Profit
Due to improvements in negative spread amounts caused by an increase in interest, dividends and otherincome, fundamental profit grew ¥1.2 billion relative to the previous fiscal year to ¥47.7 billion.
(Billions of Yen)
Years ended March 31

2021

2022

Year-over-year

Fundamental profit

46.5

47.7

+1.2

Underwriting gains

80.4

76.4

(4.0)

Negative spread amount(33.9)(28.6)+5.2

l Ordinary Profit, Net Surplus
Ordinary profit was ¥32.3 billion, with a net surplus of ¥22.9 billion.
(Billions of Yen)
Years ended March 31

2021

2022

Year-over-year

Ordinary Profit

36.6

32.3

(4.3)

Net Surplus

23.2

22.9

(0.3)

Financial Soundness (Non-consolidated)l Solvency Margin Ratio
Solvency margin ratio decreased 17.1 points relative to the end of the previous fiscal year, dropping to954.9%.
As of March 31
Solvency margin ratio

2021
972.0%

2022
954.9%

Year-over-year(17.1points)l Adjusted Net Assets
Adjusted net assets ended at ¥1,054.5 billion, a decrease of ¥105.3 billion relative to the end of theprevious fiscal year.
(Billions of Yen)
As of March 31
Adjusted net assets

12

Asahi Mutual Life Insurance Company Annual Report 2022

2021

2022

1,159.9

1,054.5

Year-over-year(105.3)

4. Business Overview for Fiscal Year 2021

l Net Unrealized Gains/Losses on Securities (general account)
As of March 31
Securities

2021(Billions of Yen)
2022

Year-over-year

535.8

385.8

(150.0)

Domestic stocks

227.9

246.3

+18.3

Domestic bonds

237.3

134.2

(103.0)Foreign securities

62.5

1.9

(60.5)

Other securities

5.6

1.3

(4.2)

*The above table excludes interests in investment partnerships and certain investment assets not readily affected by market valuation.

l Capital BaseFoundation funds, which are the counterpartsof paid-in capital for joint stock corporations,serve as the primary source of capital for Japanesemutual companies. Unlike paid-in capital, however,foundation funds have a stated maturity and accrue
interest payment obligations. If the principal amountof the foundation funds is repaid by insurancecompanies out of their net assets, the Insurance
Business Act requires that an amount equivalent to
the repayment be set aside in the net assets portionof the balance sheet as reserve for redemptionof foundation funds. As of March 31, 2022, thebalance of foundation funds was ¥91.0 billion andthe amount of reserve for redemption of foundation
funds was ¥166.0 billion, respectively.
Additionally, we have also worked onstrengthening our financial soundness byaccumulating internal reserves and raising funds
in the form of subordinated debt which, whileaccounted for as a liability, functions largely like
capital.

13

4. Business Overview for Fiscal Year 2021

Results of Operations (Non-consolidated)l Selected Data of Statements of Income(Billions of Yen)
Years ended March 31
Ordinary income:2022

Year-over-year

600.7

597.9

99.5%

391.4

387.1

98.9%

369.8

366.6

99.1%

146.5

144.9

98.9%

Interest, dividends and other income

118.1

120.5

102.0%

Gains on sales of securities

15.2

11.9

78.4%

62.7

65.7

104.8%

48.6

54.3

111.7%

564.0

565.6

100.3%

385.3

381.4

99.0%

Claims

112.0

107.5

96.0%

Annuities

122.1

116.7

95.6%

Benefits

68.2

72.9

106.9%

Surrender benefits

77.5

79.2

102.2%

Investment expenses:

34.5

36.6

106.1%

Losses on sales of securities

5.5

11.1

202.5%

Losses on valuation of securities

0.0

0.2

1,396.8%

Operating expenses

110.3

110.3

100.1%

Other ordinary expenses

33.8

33.6

99.5%

Ordinary profit

36.6

32.3

88.2%

Extraordinary gains:

0.2

2.9

1,064.1%

0.1

2.9

2,001.5%

8.6

6.5

76.3%

Losses on disposal of fixed assets

1.4

2.7

185.8%

Impairment losses

2.9

1.1

38.7%

Provision for reserve for price fluctuation

2.4

2.5

103.3%

Surplus before income taxes

28.3

28.6

101.3%

Total income taxes

5.0

5.7

114.1%Net surplus

23.2

22.9

98.5%

Premium and other income:Insurance premiums from individual insurance andindividual annuities
Investment income:

Other ordinary income:Reversal of policy reserves
Ordinary expenses:
Claims and other payments:

Gains on disposal of fixed assets
Extraordinary losses:

Ordinary income was ¥597.9 billion (99.5% of theprevious fiscal year), of which ¥387.1 billion (98.9%)
was premiums and other income. Investment
income decreased to ¥144.9 billion (98.9%) mainly
due to a drop in gains on sales of securities.
Ordinary expenses were ¥565.6 billion (100.3%),of which ¥381.4 billion (99.0%) increased to claims
and other payments. Investment expenses were
¥36.6 billion (106.1%) due primarily to increased

14

2021

Asahi Mutual Life Insurance Company Annual Report 2022

losses on sales of securities. Operating expenses
were ¥110.3 billion (100.1%).
This resulted in an ordinary profit of ¥32.3 billion(88.2%).
Extraordinary gains were ¥2.9 billion (1,064.1%),
and extraordinary losses were ¥6.5 billion (76.3%).
Total income taxes reached ¥5.7 billion.
As a result of the above factors, net surplus was¥22.9 billion (98.5%).

4. Business Overview for Fiscal Year 2021

Assets, Liabilities and Net Assets (Non-consolidated)l Selected Assets Data
As of March 31(Billions of Yen)
2021

2022

5,539.4

5,504.1(35.2)

Cash, deposits and call loans

148.3

146.8

(1.5)

Monetary claims bought

25.0

22.5

(2.5)

4,612.3

4,565.8(46.4)

Domestic bonds

2,714.7

2,627.8(86.9)

Domestic stocks

447.3

472.5

+25.2

Foreign securities

1,368.8

1,395.6

+26.8

Loans

303.4

311.4

+7.9

Tangible fixed assets

377.8

368.5

(9.2)

Others

72.3

88.9

+16.6

Total assets:

Securities:(Billions of Yen)l Selected Liabilities/Net Assets Data
As of March 31
Total liabilities:
Policy reserves and other reserves:
Policy reserves
Bonds payable
OthersYear-over-year

2021

2022

5,014.8

5,002.2(12.6)

4,477.9

4,425.7(52.2)

4,419.3

4,365.0(54.3)

127.7

102.4

(25.3)

Year-over-year

409.1

474.0

+64.9

524.5

501.9

(22.5)

356.6

374.7

+18.0

Foundation funds

91.0

91.0

–

Reserve for redemption of foundation funds

166.0

166.0

–

Reserve for revaluation

0.2

0.2

–

Surplus:

99.3

117.4

+18.0

Reserve for future losses

0.3

0.3

+0.0

Other surplus:

99.0

117.0

+18.0

Reserve for fund redemption

44.4

53.5

+9.1

Equalized reserve for dividends topolicyholders

7.0

6.9

(0.1)

Unappropriated surplus (loss)

47.5

56.6

+9.0

Total valuation and translation adjustments:

167.8

127.1

(40.6)Net unrealized gains (losses) on available-for-salesecurities, net of tax

213.2

173.9

(39.2)

Land revaluation differences(45.3)(46.7)(1.3)

Total liabilities and net assets

5,539.4

5,504.1(35.2)

As of March 31, 2022, total assets were ¥5,504.1
billion, with securities accounting for ¥4,565.8 billion,loans at ¥311.4 billion, and tangible fixed assets at¥368.5 billion. For securities, we limited allocations todomestic bonds due to low domestic interest rates inJapan. Foreign securities increased as we allocatedfunds to relatively higher-yield foreign bonds.

Total liabilities were ¥5,002.2 billion, of which
policy reserves accounted for ¥4,365.0 billion.
Total net assets were ¥501.9 billion, of which
total foundation funds and others amounted to¥374.7 billion, and total valuation and translation
adjustments amounted to ¥127.1 billion.

Total net assets:
Total foundation funds and others:15

4. Business Overview for Fiscal Year 2021

Non-Financial Highlights
Number of Customers(End of FY 2021, Group)

2.64

millionAsahi Life Group had 2.64
million customers as of theend of FY 2021, an increase of
37 thousand from the end of
the previous fiscal year.

Total Payments of Claims, Annuities andBenefits(FY 2021, Non-consolidated)

¥

297.2

Claims, annuities, and benefits
payments made in FY 2021
totaled ¥297.2 billion.

billionCustomer Satisfaction(End of FY 2021, Non-consolidated)

78.6

Customer satisfaction reached78.6%, an improvement of 0.9
points from the previous fiscal
year.

%

Greenhouse Gas Emissions(End of FY 2020, Non-consolidated)■ Life Insurance Business(1)Scope1 + Scope2:
Scope1:
Scope2:
Scope 3 (Categories 1 to 14):
■ Investment Portfolio(2)Scope 3 (Category 15):

57.5
26.8
30.6
65.3

646.3

thousand tons - CO2
thousand tons - CO2
thousand tons - CO2

As measures tackling climatechange, one of our priorities
for sustainable management,
we established FY 2030
interim reduction targets forgreenhouse gas emissions
and resolved to aim to reducegreenhouse gas emissions to“net zero” levels by FY 2050.

thousand tons - CO2

thousand tons - CO2(1) Calculated based on the Ministry of the Environment and Ministry of Economy, Trade and Industryʼs “Basic Guidelines on Accounting
for Greenhouse Gas Emissions Throughout the Supply Chain.”(2) The target assets consist of stocks, corporate bonds, and loans of publicly listed companies in Japan, and the measured emissions are
Scope 1 + Scope 2 emissions of the companies in which investments were made.

16

Asahi Mutual Life Insurance Company Annual Report 2022

4. Business Overview for Fiscal Year 2021

Number of Employees

Of which

14,241

18,345

Asahi Life consists of 18,345
employees, of whom 14,241
are sales representatives and4,104 are office staff.

are sales representatives

Ratio of Female Leaders

31%

Rate of Childcare Leave Usage byMale Employees(FY 2021)

100%

Over 80% of all Asahi Life
employees are female.
Working on initiatives such as“female career development”
and “support for work-homebalance” since FY 2006, we
achieved a female leader ratioof 31% as of the beginning of
FY 2022.
As part of our support forachieving balance between
work and childcare, Asahi
Life has worked to promote
understanding of support
for this balance since FY2015 and strived to create anenvironment and company
culture in which it is easy for
employees to take childcare
leave. Since FY 2017, we havemanaged to maintain a rate of
100% usage of childcare leaveby male employees for fiveconsecutive years.

Offices(April 1, 2022)

58
568

branches

Asahi Life has 58 branches
and 568 sales offices
throughout Japan where sales
representatives provide theright products and services
for each and every customerʼsneeds in a face-to-facecontext.

sales offices17

5. Investments
Investments (General Account)
In order to properly respond to the mandate
given us by our customers, Asahi Life seeks out
investments that are safe and provide an advantage,and in light of the public nature of the life insurance
business, we conduct investment considering public
and social aspects.

Further, through investment, Asahi Life contributes
to the resolution of environmental issues and otherglobal social problems, in addition to aiming to
reduce investment risk and secure new income
opportunities.

FY 2021 Investment Environment
In FY 2021, the Japanese economy continued
to rally as the economic impact of the COVID-19
pandemic gradually wore off, but consumer
spending seemed to be in somewhat of a standstillsince the start of 2022.
Internationally, the global economy continued tomake a recovery centered on the United States as
the impact of the COVID-19 pandemic faded.

FY 2021 Initiatives
In FY 2021, Asahi Life curbed investment inJapanese government bonds and similar assets due
to ongoing low domestic interest rates and opted fora risk-avoidant strategy of diversified investments,
improving investment income by actively pursuing
credit investments*1 that are efficient in terms ofrisk-return in preparation for the implementation of
economic value-based regulations in 2025.

Moreover, as a responsible institutional investorand signatory to the PRI, we are promoting
good stewardship and pursuing investment thatincorporate ESG factors (environment, social, andgovernance).
*1 Investments in corporate bonds, loans, and similar products.

Overview of Investment Performance for FY 2021
In FY 2021, Asahi Life focused funding on credit
investments that are highly efficient in terms of riskreturn.
For domestic bonds, we purchased assets withcredit spreads such as corporate bonds, while
limiting purchases of government bonds.
For loans, we made aggressive investments inproject finance for domestic and foreign renewableenergy-related projects.
We partially restructured our domestic stock
portfolio to favor companies with better profitability,
dividends, and other qualities.
For foreign currency-denominated bonds, of

foreign securities, we purchased corporate bonds
and other securities while partially restructuring
our portfolio to improve yields. For alternative
investments*2, we focused primarily on funds thatoffer stable returns and are less susceptible toeconomic fluctuations.
We made an effort to improve real estate
profitability by attracting new tenants and othermeasures.
*2 Investments in infra-funds, real estate investment trusts, hedge
funds, etc., which are considered as alternative investments totraditional investment assets such as stocks and bonds.

Future Initiatives
We will shift to an economic value-based portfolio
in preparation for the implementation of economic
value-based regulations in 2025.
With financial tightening worldwide and aplethora of unpredictable factors such as global
inflation and the situation in Ukraine, we will aim
to diversify the range of asset classes in which weinvest to mitigate risk and secure profits in pursuit

18

Asahi Mutual Life Insurance Company Annual Report 2022of sustainable investment income.
As a responsible institutional investor, we will
promote good stewardship and pursue ESG(environment, social, and governance) investment
in order to contribute to the resolution ofenvironmental issues and other global social
problems, and to reduce investment risk and secure
new income opportunities.

5. Investments

Responsible Investment Initiatives
In our investment activities, Asahi Life views
investment based on our Basic Policy on ESG
Investment and Basic Policy for Fulfilling StewardshipResponsibilities as “Responsible Investment.”

In particular, we have focused on “climate change”
and “good physical health” as priority themes in ourefforts to resolve social issues as we accelerate ESG
investment initiatives.

FY 2021 ESG Investment Initiatives

Investment that takes
non-financial information
into account(Integration)

We began investment considering not only financial data
but also non-financial information (sustainability-related
information) of investee companies in all assets

Dialogue onsustainability-related
issues(Engagement)

We conducted dialogues on sustainability-related issues
with investee companies in not only stock investment but
also bond and loan investment

ESG-themed Investment

We have promoted ESG-themed investment with a focus
on renewable energy project finance and others

Negative Screening

We do not invest in projects to develop coal-fired power
generation facilities, manufacturers of inhumane weapons(including nuclear weapons), and tobacco productmanufacturers

19

5. Investments

FY 2021 Stewardship Initiatives
Asahi Life aims to make stable and efficientinvestment of the assets entrusted in us by ourcustomers in the form of insurance premiums in
preparation for future payments of claims, benefits

and others. We view stewardship activities as
extremely important work in order to improve theeffectiveness of our investment activities in themedium to long term.

Fulfilling stewardship responsibilities toward
customers and financial markets
Reporting on activity status
Stewardship activities“Basic Policy for Fulfilling Stewardship Responsibilities”

Productive
dialogue

Consideration and execution of saleof investment assets

Appropriate
exercising of voting
rights (stocks)

If no expectation of improvements
in corporate value...

Monitoring thestatus of companies
in which we haveinvested“Policy for Exercising Voting Rights”“Guidelines for Exercising Voting Rights”<Improving Corporate Value>
Shareholder returns for stock

Growth of Asahi Life’s investment income

Dialogue - Engagement
Asahi Life views constructive dialogue as a major
pillar underlying our stewardship activities as wellas important initiatives that improve corporate
value and promote sustainable growth of investee
companies.
When engaging in dialogue with the companies
in which we invest, we first select companies on thebasis of analysis and understanding of trends incompany performance, financial condition, content
of their business plans and progress thereof, status
of initiatives on sustainability issues, and corporate
governance structure, then set key issues for eachmatter and begin an exchange of opinions.

■ Primary Stewardship Themes
Bolstering shareholder
returns

Approach to shareholder returns

20

Asahi Mutual Life Insurance Company Annual Report 2022

Bolstering initiatives onsustainability-related issues<Priority Initiative Themes>
Climate change, good physical health
Status of initiatives to resolve or
make improvements to issues

Building corporate
governance systems

Sustainability management
Status of system-building6. Multiple Channel System
Overview of the Sales Representative Channel
As peopleʼs medical and nursing care expenses
become a serious social problem in Japanʼs superaged society, we will enable our customers to help
themselves in this era of 100-year lifespans byproviding the medical and nursing care insurance
products and services in which Asahi Life specializes,
as well as by providing value in the healthcare
field, such as by helping to ward off a worseningof patientsʼ conditions. Above all, in the nursing
care insurance sector, we aim to exert our market
presence as “the go-to company for nursing careinsurance.”
Additionally, we will work to bolster our
personnel development initiatives with respect tosales representatives by expanding our training
infrastructure at all offices to build up a sales

representative channel that continues to be trusted
and chosen by each and every customer.
Furthermore, we will implement digital (ICT)
initiatives to handle diversifying demands of ourcustomers and provide added value in the formof a better customer experience. We will improvecustomer convenience through the digitalizationof various insurance procedures and enhance oursales activities by expanding the functionality ofdigital tools, web applications, and other solutions.
These sorts of initiatives will provide a powerful
push forward, and by venturing into new sectors,
we will strongly assert Asahi Lifeʼs presence in themarket, boost customer satisfaction, and aim togrow our customer base.

Overview of Other Channels
Tax Accounting Agencies
We have signed agency agreements with tax
accountants throughout Japan to offer products
for management personnel via consulting services
for corporate clients. We also have personnel

responsible for such tax accounting agencies inplace across the country to bolster our support
infrastructure.

Telemarketing
We sell easy-to-understand third sector products
such as medical insurance over the phone to themembers of alliance partners such as credit cardcompanies and catalogue mail-order companies. In

addition to training the operators, we also engage
in activities aimed at improving the quality of calls
through regular monitoring and other measures.

Direct Sales
In collaboration with advertising management
and other industries, we sell cognitive impairment
insurance and other third-sector products forwhich administrative procedures can be conductedentirely over the internet. We also provide various
forms of training for call center operators to enhancethat support structure and enable them to better
explain the relevant products and procedures.

Overview of Overseas BusinessIn 2017, Asahi Life began partnering with a local
Vietnamese insurance company to provide ourexpertise on selling insurance via telemarketing, inaddition to providing consulting services with an
online business model in cities like Ho Chi Minh Cityand Hanoi.
As we expand our Vietnam business moving
forward, we will aim to bolster our existing businessas well as diversify our sales channels through new
web marketing and development of face-to-facesales channels.
Moreover, in order to further expand the businessto other countries, we will continue to study andresearch various markets primarily in Asian countries
that are expected to experience high growth.

21

7. Addressing the Recommendations of the Task Forceon Climate-related Financial Disclosures (TCFD)
Asahi Life endorsed the recommendations of
the TCFD, which was established by the Financial
Stability Board, in June 2019.
With respect to the climate change-relatedthematic areas of “governance,” “strategy,” “riskmanagement,” and “metrics and targets” containedin the TCFDʼs climate recommendations, we will
work to make full disclosures regarding the status ofinitiatives that “contribute to the achievement of asustainable society” from both our primary business,life insurance, and from our investment business as
an institutional investor.

Governance
Asahi Life has established the Asahi Life
Environmental Policy for the implementation ofclimate change initiatives and other initiatives toprotect the Earthʼs environment. In our investment
activities, Asahi Life views investment based on
our Basic Policy on ESG Investment and Basic
Policy for Fulfilling Stewardship Responsibilities

as “responsible investment” which includes our
initiatives to tackle climate change.
Based on these policies, we established a
Sustainable Management Promotion Committee
headed by Asahi Lifeʼs company president and weare pursuing deeper talks in the Board of Directors
regarding important sustainability-related issues.

Strategy
Overall
The risks posed to Asahi Life by climate change
are separated into “physical risks*1” and “transition
risks*2”, or alternatively into “life insurance business”
and “investment” risks.
In order to understand the impact on Asahi Life of
the risks and opportunities accompanying climatechange, we conducted scenario analysis based on
forecasts of environmental change and the impact
thereof.
Scenario analysis of the impact of climate change
on Asahi Life based on 1.5℃ and 4℃ temperature
increase scenarios leads us to believe that we
Global Scenario

Average Temperature in 2100

Scenario in which there is a global transition to a decarbonizedsociety that successfully controls rising temperatures

1.5℃ rise in temperatures compared tobefore the Industrial Revolution

Scenario in which there is not a global transition to a
decarbonized society and temperature increases continue

4℃ rise in temperatures compared tobefore the Industrial Revolution*1 Direct/indirect losses caused by climate change.
*2 Risks arising in the process of curtailing greenhouse gas emissions.

22

should focus in the short term on transition risk,
and primarily for investment. On the other hand,
we also recognize that as the average temperature
increases in the long term, the impact of “physicalrisks” will increase to primarily the life insurance
business.
We will examine the impact as determinedby scenario analysis from both perspectives, as
an operational company and as an institutional
investor, as we move ahead with business activities
in the future and contribute to the achievement of adecarbonized society.

Asahi Mutual Life Insurance Company Annual Report 2022

7. Addressing the Recommendations of the Task Force on Climate-related Financial Disclosures (TCFD)

Investment
We believe that physical and transition risks
associated with climate change will have an impact
on our investee companiesʼ sustainability, and that
this represents a risk of damaging asset values.
Based on this belief, we will set “climate change”
as a priority theme and accelerate responsible
investment initiatives moving forward.
In terms of specific initiatives, our investment
activities will incorporate non-financial information(sustainability-related information including climatechange and other ESG factors) across all assets.
In the interest of reducing climate change risk in
our investment portfolio, we will continue engaging
in dialogues with publicly listed investee companies,
as well as with high greenhouse gas-emitting
companies that we have financed or from which wehave purchased bonds, to encourage them to make
improvements.
Additionally, we subject projects to develop
coal-fired power generation facilities to negative
screening.
Meanwhile, we also view steps to resolve climatechange problems as potential opportunities
to generate revenue by providing us with newinvestment opportunities. Moving forward, Asahi
Life will actively invest in themed assets such as
renewable energy project finance that contributes
to the resolution of climate change issues.
We will also work to improve initiatives throughquantitative analysis of climate change risk and theconsideration of investment strategies based onsuch analysis.

Risk Management
Overall
In order to properly address risks thatare increasingly diverse and complex, we
comprehensively investigate all risks facing Asahi
Life and work to monitor and evaluate them.
Specific risks are not independent but are rather
linked to and affect one another, and for this reason
we have established a framework for comprehensive
overall risk management by which be implement
initiatives.
Climate change risk is considered an importantrisk that will have a broad impact on various
other risks, such as insurance underwriting risk
and investment risk, so we work to understandanticipated risk and the impact thereof as well as
regulatory trends inside and outside of Japan.
These various risks facing Asahi Life are organized
into and evaluated as “risk profiles” and regularly
reported at Management Meetings for proper risk
management.

Investment
In investment, climate change risk is recognized
as an important risk that needs to be managed,
and we are analyzing its impact on our investment
portfolio. Specifically, we are working on studying

and collecting data in order to quantify risks while
also developing an investment screening system forinvestee companies that takes into account climatechange risk and other ESG factors.

23

7. Addressing the Recommendations of the Task Force on Climate-related Financial Disclosures (TCFD)

Metrics and Targets
Life Insurance BusinessWe are working to reduce greenhouse gas
emissions.

Category*1

We are also promoting the transition to renewable
power sources.

FY 2020 results(Units: Thousands oftons of CO2)

Scope1+Scope2

57.5

Scope 1

26.8

Scope 2

30.6
65.3

Scope 3 (Categories 1 to 14)

FY 2030 reduction
targets(compared to FY 2020)

FY 2050 reduction
targets−50%

Net zero−50%

Net zero*1 An overview of these categories is provided below, based on the Ministry of the Environment and Ministry of Economy, Trade andIndustryʼs “Basic Guidelines on Accounting for Greenhouse Gas Emissions Throughout the Supply Chain.”
Scope 1: Direct emissions resulting from fuel usage (e.g., gasoline, city gas) at the company itself, etc.
Scope 2: Indirect emissions resulting from the use of purchased electricity at the company itself, etc.
Scope 3: Indirect emissions not covered by Scope 1 and Scope 2 (other companiesʼ emissions generated in connection with thecompanyʼs own activities).

Investment
In order to reduce greenhouse gas emissions, wewill support initiatives to address climate change byprioritizing dialogue (engagement) with companies
in which we are investing rather than by pulling out
of such companies (divestment). In this way, we will
promote the establishment or addition of emissions

Category
Scope 3 (Category 15*1)

reduction targets as well as specific initiatives
at those companies. We will actively conduct
themed investment activities focused on assets that
contribute to the resolution of the climate change
problem.

FY 2020 results(Units: Thousands oftons of CO2)
646.3

FY 2030 reduction
targets(compared to FY 2020)

FY 2050 reduction
targets−39%*2Net zero*1 Target assets are stocks, corporate bonds, and loans of publicly listed companies in Japan. Measurement is focused on Scope 1 +Scope 2 emissions of companies in which investments were made*2 −50% compared to FY 2013, which is the same as the Japanese governmentʼs reduction target (Challenging Goal). Reduction targets
are based on total emissions.

24

Asahi Mutual Life Insurance Company Annual Report 2022

8. Governance Structure
Corporate Governance
Basic Philosophy on Corporate Governance
Recognizing that the life insurance industry plays
an important role in supporting Japanese society
in cooperation with the social security system,and that our companyʼs business itself constitutes
an important social responsibility, Asahi Life holds
a basic management philosophy of “Sincere
Service.” This is guided by the idea that fulfilling our
responsibilities to our customers, society, and our
employees is fundamental to our business.
Based on our basic management philosophy,
we work to maintain strong cooperation with allof our stakeholders and promote corporate social
responsibility-based management centered on thefollowing:- Engaging in business that prioritizes the
improvement of customer satisfaction;- Co-existence with society through continued
engagement to create a prosperous society,and;- Improvement of employee satisfaction throughthe creation of a comfortable workplace that
fosters employees.
We promote sustainable management that
contributes to the achievement of a sustainable
society and make efforts to achieve effective
corporate governance in order to both maintainour financial soundness and make decisions in atransparent, fair, quick, and decisive manner.

Overview of the Corporate Governance Structure
Asahi Life is a mutual company. A mutualcompany is a corporate structure in which
individual policyholders (excluding holders of nonparticipating policies) may directly participate in the
management. Instead of holding a General Meetingof Policyholders, we have established a Board ofRepresentative Policyholders.
This serves as the highest decision-making bodywhich consists of representatives elected fromamong our policyholders.

Additionally, in accordance with the institutional
design required by the Insurance Business Act, wehave opted to be a company with a Board of Statutory
Auditors. The Board of Directors makes decisions on
basic company management issues and supervises
the execution of the duties of the directors. While
the Statutory Auditors also supervise the executionof the duties of the directors, they do this as anindependent body entrusted by the policyholders.

Management Organization
Policyholders
Board of Representative
Policyholders

Board of Statutory Auditors

Conference with Customers

Board of Trustees
Board of Directors

Statutory Auditors
Nomination andCompensation Committee
Chief of Internal
Audit Department
Executive Officers' Meeting

Chief ActuaryManagement Meeting

Meetings
Committees

25

8. Governance Structure

Board of Representative Policyholders
Framework and Functions of the Board of Representative Policyholders
Asahi Life has adopted a mutual company
corporate structure that is only permitted for insurancecompanies. Under this structure, the company iscomprised of individual insurance policyholders, who
are considered members of the company. Therefore,
the General Meeting of Policyholders serves as thehighest decision-making body at Asahi Life, but since
it is difficult to realistically hold a General Meetingfor all roughly 1.89 million policyholders, we haveestablished a Board of Representative Policyholders
in accordance with the Insurance Business Act to act
on behalf of the General Meeting of Policyholders.
The main issues reported and resolutions madein the Board of Representative Policyholders are as
follows.

Reported issues:
Business reports, balance sheets, statements ofincome, statements of changes in net assets,
operational reports specific to the mutualcompany structure
Resolutions:
Appropriation of surplus, allotment ofdividends to policyholders, changes in articles
of incorporation, appointment of nominating
committee members for representative
policyholders, appointment of trustees,
appointment of directors/statutory auditors, etc.

Promoting Compliance
Asahi Life positions compliance with laws andordinances as one of the most critical issuesof management, needed to conduct sound,transparent and fair business as well as to maintainthe trust of our customers. We work to fostera corporate culture that both promotes andemphasizes compliance.

All employees devote themselves to legallycompliant and appropriate business. We strive
to prevent any illegal or inappropriate practices
and will also endeavor to make respond quickly
and appropriately in the event that any illegal orinappropriate business practices are encountered.

Basic Policy/Compliance with Standards
Asahi Life has established the Basic Policy on
Compliance and Compliance Standards as theprimary guidelines to be observed by all employees.
These are made widely and thoroughly known
among all executives and employees throughour Compliance Manual and rigorous training.
All employees must conduct and are conducting
business strictly in accordance with these policy andstandards.
Furthermore, we have also created theCompliance Program which includes a detailed
action plan. By implementing this action planand conducting reviews on a periodic basis, weare attempting to establish a more advanced
compliance framework.

Organization/System
Asahi Life holds discussions on compliancewith the Compliance Committee. The Committee
is composed of the Company President as chair,as well as Management Meeting members andthird-party lawyers. The Committee discusses

26

Asahi Mutual Life Insurance Company Annual Report 2022

compliance issues with the expert input of thethird-party lawyers. Additionally, the ComplianceControl Department implements specific measurespertaining to compliance.

8. Governance Structure

Protecting Customer Information
Management System to Appropriately Protect Information Assets
Asahi Life maintains customersʼ personal
information related to their policies and health status
insofar that the information is needed for businesspurposes. Therefore, recognizing that keeping
such customer information secure is crucially
important for management, we have establisheda framework to protect customer information,
personal information, and personally identifiable
information. We strictly implement that framework

based on the relevant laws and ordinances.
Furthermore, we have also formulated a Security
Policy to provide appropriate protection for ourcustomersʼ information. All employees perform
appropriate and strict information management
based on this policy to both fulfill our responsibility
towards our policyholders and society, and tofurther improve the credibility of our company.

Risk Management Structure
Overview
The environment surrounding life insurancecompanies is constantly changing. Against such a
backdrop, Asahi Life believes it is very importantto accurately ascertain various risks and to manage
them appropriately and strictly. Doing this helps tostabilize profits and boost financial health, which
will eventually lead to increased corporate value.

In order to ensure the fulfillment of our longterm obligations with respect to our insurance
policies, we value risk management as one ofour most important management issues and areworking to further improve and strengthen our risk
management structure.

Risk Management Structure
Asahi Lifeʼs Board of Directors has establisheda Basic Policy on Risk Management. This policy
is established to comprehensively identify risks
managed by the entire Group, and to manage suchrisks appropriately to achieve management targets.
Within this Basic Policy, we have identified thevarious types and locations of risks faced by theGroup as a whole, and with respect to each risk, we
set down certain risk management methods.
Each executive department in the company
works to appropriately control risk in the operations
under their jurisdiction as per the basic policy andrules for each risk type, while each risk management
department works to properly control risks throughregular monitoring and verification of the status ofrisks facing the Group as a whole.

Moreover, as Group businesses grow, we are
putting together a risk management infrastructure
for the entire Group through our Insurance Group
Risk Management Committee.
Furthermore, specific risks are not necessarily
independent and may be linked to and affect one
another, and for this reason a single department
is responsible for comprehensive quantitative andqualitative risk management for the Group as awhole.
Risk management status is periodically reported inmanagement meetings and the Board of Directors,
and the appropriateness and effectiveness of ourrisk management structure are audited by ourInternal Audit Department.

Risk Appetite
In order to promote the achievement of ourstrategic targets in the mid-term management
plan and comprehensive annual business plan,
we set a certain risk appetite policy to ensure
appropriate risk-taking and risk control based on
both quantitative and qualitative risk evaluation.

This policy sets both levels of tolerable risk forgenerating earnings and risks to be curbed in theinterest of financial soundness.

27

8. Governance StructureEnterprise Risk Management (ERM)
Asahi Life promotes Enterprise Risk Management(ERM) in order to ensure financial soundness andimprove profitability through comprehensive
management of risk facing the entire company.
Specifically, we establish risk management
indicators based on a risk appetite policy, conduct
quantitative and qualitative assessments to identify
problems, and then implement countermeasures asappropriate for risk severity.
Additionally, we implement the Own Risk andSolvency Assessment (ORSA), a process to evaluate
our management risks and own capital, and pursue
risk management that is integrated into our businessstrategy.
With respect to qualitative risk evaluation, we

ascertain our risk profile and specify crucial risks tomanagement by identifying not only current but
also potential risks that are discovered through ourControl Self-Assessment (CSA), which we conduct ineach operational division. We also strive to identify
risks at an early stage and to mitigate these risks
through measures such as warning analysis.
In quantitative risk evaluations, we evaluate thesufficiency of our own capital (surplus) based on
both accounting standards and economic value.
Specifically, in economic value-based evaluations,
we monitor and manage the sufficiency of current
surplus against overall risk volume (i.e., theEconomic Solvency Ratio, ESR) and we work to
improve that ratio by setting ESR targets.

Asset Liability Management (ALM)
Asahi Life engages in asset liability management(ALM) that is guided by the asset and risk
management policies established by liability groups.
These liability groups are categorized according
to the characteristics of insurance policies. Basedon the asset and risk management policies, we
confirm the appropriateness of our investments.
We structure our asset portfolio concentrating on

yen interest-bearing assets such as domestic bonds
and loans, taking into consideration the adaptationof existing assets to the liability characteristics of
insurance policies. The majority of domestic bonds
are classified as policy-reserve-matching bonds,
which are valued at their amortized cost, with the aimof reducing the impact of interest rate fluctuations.

Stress Tests
Stress tests are a way of understanding andanalyzing the impact on financial soundness of
scenarios such major fluctuations in the financial
markets causing losses and declining market
value for Asahi Lifeʼs investment portfolio, or amajor earthquake or other disaster generatinglarge insurance claims that cause losses for Asahi
Life. Stress test results are periodically reported
at Management Meetings and used to consider
management or financial countermeasures against
such scenarios. Investment risk-related stress tests

are also used to verify the validity of investment
plans and develop hedging policies.
Stress tests are also conducted for extremely
unlikely risk phenomena that would nonethelesscause tremendous losses in the event that they did
occur, in the interest of properly understanding suchphenomena. These stress tests are based on risk
profiles and seek to identify scenarios that would
have a substantial impact on financial soundness,and the specific financial impact thereof is reported
at Management Meetings.

Officers (as of July 5, 2022)
President and Representative Director

Director and Executive Officer

Standing Statutory Auditor

Hiroki Kimura

Masahiro Shimotori

Hideki Konishi

Representative Director andSenior Managing Executive Officer

DirectorStanding Statutory Auditor

Kenichiro Ishijima

Kaoru Masuda

Director

Statutory Auditor

Kazuko Ohya(1)Tadayuki Seki(2)Director

Statutory Auditor

Takashi Tsukamoto(1)Mitsuyoshi Shibata(2)Director

Statutory Auditor

Takaaki Ishii(1)Yoichi Kikuchi(2)(1) Outside director(2) Outside statutory auditor

Yasuhiro Iguchi
Director and Senior Managing Executive Officer

Yukihiro Fujioka
Director and Managing Executive Officer

Kenichi Ikeda
Director and Managing Executive Officer

Kouichi Kashimada

28

Asahi Mutual Life Insurance Company Annual Report 2022

9. Consolidated Financial Statements
Consolidated Balance Sheets
Asahi Mutual Life Insurance Company and its Consolidated Subsidiaries
Millions of
U.S. Dollars

Millions of Yen
As of March 31
ASSETS:Cash and deposits
Call loans
Monetary claims bought
Securities
Loans
Tangible fixed assets:
Land
Buildings
Lease assets
Construction in progress
Other tangible fixed assets

2022¥

Intangible fixed assets:
Software
Other intangible fixed assets
Agency accounts receivable
Reinsurance receivables
Other assets
Net defined benefit assets
Deferred tax assets
Customersʼ liabilities under acceptances and guarantees
Allowance for possible loan losses
Total assets
LIABILITIES:Policy reserves and other reserves:
Reserve for outstanding claims
Policy reserves
Reserve for dividends to policyholders
Reinsurance payables
Bonds payable
Other liabilities
Net defined benefit liabilities
Reserve for price fluctuation
Deferred tax liabilities
Deferred tax liabilities for land revaluation
Acceptances and guarantees
Total liabilities
NET ASSETS:
Foundation funds
Reserve for redemption of foundation funds
Reserve for revaluation
Consolidated surplus
Total foundation funds and others
Net unrealized gains (losses) on available-for-salesecurities, net of tax
Land revaluation differences
Accumulated remeasurements of defined benefit plans
Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets¥¥¥

47,030111,000
22,5344,536,365
311,4162021¥

44,149113,000
25,094
4,598,851
303,451

2022
$

384
906
184
37,064
2,544

216,027
146,679
2,194
1,175
3,065
369,142

221,081
150,539
1,459
1,589
3,376
378,046

1,765
1,198
17
9
25
3,016

23,347
9,907
33,255
11
6,788
64,605
524
168
–
(550)
5,502,292

16,93513,00629,941
14
987
46,670
494
152
1
(406)
5,540,449

190
80
271
0
55
527
4
1
–
(4)
44,95732,0254,365,560
28,644
4,426,229
776
102,424
378,694
32,852
48,2102,913
15,711–
5,007,812¥¥

28,572
4,419,372
30,0504,477,995
680
127,773295,766
32,91445,68022,354
16,2681
5,019,435$$

261
35,669234
36,164
6
836
3,094
268
393
23
128
–
40,91691,000166,000
281
111,982369,264

91,000166,000
281
97,154354,436

743
1,356
2
914
3,017

173,938(46,739)(2,077)125,12194
494,480
5,502,292

213,201(45,354)(1,349)166,49779
521,014
5,540,449

1,421
(381)
(16)
1,022
0
4,040
44,957¥$29

9. Consolidated Financial Statements

Consolidated Statements of Income and Consolidated Statements ofComprehensive Income
Asahi Mutual Life Insurance Company and its Consolidated Subsidiaries[Consolidated Statements of Income]Millions of
U.S. Dollars

Millions of Yen
For the years ended March 31
Ordinary income:Premium and other income
Investment income:Interest, dividends and other income
Gains on sales of securities
Gains on redemption of securities
Foreign exchange gains
Other investment income
Investment gains on separate accounts
Other ordinary income
Total ordinary income
Ordinary expenses:
Claims and other payments:
ClaimsAnnuities
Benefits
Surrender benefits
Other payments
Provision for policy reserves and other reserves:
Provision for reserve for outstanding claims
Provision for interest on policyholders' dividend reserves
Investment expenses:
Interest expenses
Losses on trading securities
Losses on sales of securities
Losses on valuation of securities
Losses on redemption of securities
Losses on derivative financial instruments
Provision for allowance for possible loan losses
Depreciation of rental real estate and other assets
Other investment expenses
Operating expenses
Other ordinary expenses
Total ordinary expenses
Ordinary profit
Extraordinary gains:
Gains on disposal of fixed assets
Other extraordinary gains
Extraordinary losses:
Losses on disposal of fixed assets
Impairment losses
Provision for reserve for price fluctuation
Losses on reduction entry of real estate
Other extraordinary losses
Surplus before income taxes

30

Asahi Mutual Life Insurance Company Annual Report 2022

2022¥

395,434

2021
¥

2022

391,410$3,230

120,142
11,950
317
3,067
6,872
2,199
144,550
70,423
610,408

117,912
15,249
77
387
6,941
5,740
146,309
66,577604,297

981
97
2
25
56
17
1,181
575
4,987

107,517
116,767
73,011
79,236
5,988
382,521112,015
122,158
68,241
77,5385,431
385,384

878
954
596
647
48
3,125

3,453
3
3,456

–
3
3

28
0
28

4,876
1,133
11,177
273
48
2,510
141
5,511
10,981
36,655
123,403
35,050581,087
29,321

4,470
485
5,520
19
65
8,898
10
5,503
9,584
34,559115,565
33,833569,347
34,950

39
9
91
2
0
20
1
45
89
299
1,008
286
4,747
239

2,925
3
2,928

146
129
275

23
0
23

2,751
1,149
2,530
–
130
6,561
25,687

1,484
2,971
2,450
5
1,694
8,605
26,620

22
9
20
–
1
53
209

9. Consolidated Financial Statements

Millions of
U.S. Dollars

Millions of Yen
For the years ended March 31
Income taxes:
Current
Deferred
Total income taxes
Net surplus
Net surplus attributable to non-controlling interests
Net surplus attributable to the Parent Company

2022

¥

10,963(5,012)
5,950
19,73751
19,6852021
10,226(5,074)
5,152
21,46737
21,430

¥

2022
89
(40)
48
161
0
160

$

[Consolidated Statements of Comprehensive Income]Millions of
U.S. Dollars

Millions of Yen
For the years ended March 31
Net surplus
Other comprehensive income:Net unrealized gains (losses) on available-for-salesecurities, net of tax
Remeasurements of defined benefit plans
Total other comprehensive income
Comprehensive income:Comprehensive income attributable to the Parent
Company
Comprehensive income attributable to non-controllinginterests
Total comprehensive income

2022
¥

¥

19,7372021¥

21,467

2022
$

161

(39,263)(728)(39,991)

115,575465
116,040

(320)
(5)
(326)

(20,305)

137,471(165)

51(20,254)¥37
137,508

$

0
(165)

31

9. Consolidated Financial Statements

Consolidated Statements of Changes in Net Assets
Asahi Mutual Life Insurance Company and its Consolidated Subsidiaries
Millions of Yen
Foundation funds and others
For the year ended March 31, 2022

Beginning balance
Changes in the fiscal year:
Additions to reserve for dividends to policyholders
Payment of interest on foundation funds
Net surplus attributable to the Parent Company
Reversal of land revaluation differences
Net changes, excluding foundation funds and others
Net changes in the fiscal year
Ending balance

Reserve for
Total
Foundation redemption Reserve for Consolidated foundationof foundation revaluation
surplusfunds and
funds
funds
others¥ 91,000 ¥ 166,000 ¥281 ¥ 97,154 ¥ 354,436(2,153)(4,089)19,685
1,384––¥ 91,000 ¥ 166,000 ¥(2,153)(4,089)19,685
1,384–
14,827
14,827281 ¥ 111,982 ¥ 369,264

Millions of Yen
Accumulated other comprehensive income

For the year ended March 31, 2022

Beginning balance
Changes in the fiscal year:
Additions to reserve for dividends topolicyholders
Payment of interest on foundation funds
Net surplus attributable to the Parent
Company
Reversal of land revaluation differences
Net changes, excluding foundation
funds and others
Net changes in the fiscal year
Ending balance

32

Asahi Mutual Life Insurance Company Annual Report 2022

Net
unrealized
Total
NonAccumulated accumulated
gains (losses)
Land
controllingon available- revaluation remeasurements
otherinterestsof defined comprehensive
for-saledifferences benefit
plans
securities,
incomenet of tax¥ 213,201 ¥ (45,354) ¥(1,349) ¥ 166,497 ¥Total net
assets79 ¥ 521,014(2,153)(4,089)19,685
1,384(39,263)(1,384)(39,263)(1,384)¥ 173,938 ¥ (46,739) ¥(728)(41,375)(728)(41,375)(2,077) ¥ 125,121 ¥14(41,360)
14(26,533)
94 ¥ 494,480

9. Consolidated Financial Statements

Millions of Yen
Foundation funds and others
For the year ended March 31, 2021

Beginning balance
Changes in the fiscal year:
Additions to reserve for dividends to policyholders
Payment of interest on foundation funds
Net surplus attributable to the Parent Company
Reversal of land revaluation differences
Net changes, excluding foundation funds and others
Net changes in the fiscal year
Ending balance

Reserve for
Total
Foundation redemption Reserve for Consolidated foundationof foundation revaluation
surplusfunds and
funds
funds
others¥ 91,000 ¥ 166,000 ¥281 ¥ 81,429 ¥ 338,711(1,794)(4,081)
21,430171––¥ 91,000 ¥ 166,000 ¥(1,794)(4,081)
21,430171–
15,725
15,725281 ¥ 97,154 ¥ 354,436

Millions of Yen
Accumulated other comprehensive income

For the year ended March 31, 2021

Beginning balance
Changes in the fiscal year:
Additions to reserve for dividends topolicyholders
Payment of interest on foundation funds
Net surplus attributable to the Parent
Company
Reversal of land revaluation differences
Net changes, excluding foundation
funds and others
Net changes in the fiscal year
Ending balance

Net
Total
unrealized
NonAccumulated accumulatedLand
gains (losses)
controlling
remeasurementsotheron available- revaluation of definedinterests
differences benefit plans comprehensive
for-saleincomesecurities,
net of tax¥ 97,625 ¥ (45,183) ¥(1,814) ¥ 50,627 ¥Total net
assets81 ¥ 389,420(1,794)(4,081)
21,430171
115,575(171)
115,575(171)¥ 213,201 ¥ (45,354) ¥465
115,869
465
115,869(1,349) ¥ 166,497 ¥(1)
115,868(1)
131,59379 ¥ 521,014

33

9. Consolidated Financial Statements

Millions of U.S. Dollars
Foundation funds and others
Reserve for
Total
Foundation redemption Reserve for Consolidated foundationof foundation revaluation
surplusfunds and
funds
funds
othersFor the year ended March 31, 2022

Beginning balance
Changes in the fiscal year:
Additions to reserve for dividends to policyholders
Payment of interest on foundation funds
Net surplus attributable to the Parent Company
Reversal of land revaluation differences
Net changes, excluding foundation funds and others
Net changes in the fiscal year
Ending balance

$

$

743 $

–
743 $

1,356 $

2 $–
1,356 $

–
2 $

793 $

2,895

(17)
(33)
160
11

(17)
(33)
160
11

121
914 $

121
3,017

Millions of U.S. Dollars
Accumulated other comprehensive income

For the year ended March 31, 2022

Beginning balance
Changes in the fiscal year:
Additions to reserve for dividends topolicyholders
Payment of interest on foundation funds
Net surplus attributable to the Parent
Company
Reversal of land revaluation differences
Net changes, excluding foundation
funds and others
Net changes in the fiscal year
Ending balance

34

Asahi Mutual Life Insurance Company Annual Report 2022

Net
Total
unrealized
NonAccumulated accumulatedLand
gains (losses)
controlling
remeasurementsotheron available- revaluation of definedinterests
differences benefit plans comprehensive
for-saleincomesecurities,
net of tax$

1,741 $

(370) $

(11) $

1,360 $

Total net
assets

0 $

4,256

(17)
(33)
160
11

$

(320)
(320)
1,421 $

(11)(11)(381) $

(5)(5)(16) $(338)(338)
1,022 $

0
0
0 $

(337)
(216)
4,040

9. Consolidated Financial Statements

Consolidated Statements of Cash FlowsAsahi Mutual Life Insurance Company and its Consolidated Subsidiaries
Millions of
U.S. Dollars

Millions of Yen
For the years ended March 31
I. Cash flows from operating activities
Surplus before income taxes
Depreciation of rental real estate and other assets
Depreciation
Impairment losses
Increase (decrease) in reserve for outstanding claims
Increase (decrease) in policy reserves
Provision for interest on policyholders' dividend reserves
Increase (decrease) in allowance for possible loan losses
Increase (decrease) in net defined benefit liabilities
Increase (decrease) in reserve for price fluctuation
Interest, dividends and other income(Gains) losses on securities(Gains) losses on derivative financial instruments
Interest expenses
Foreign exchange (gains) losses, net(Gains) losses on tangible fixed assets(Increase) decrease in reinsurance receivables(Increase) decrease in other assets except from investing
and financing activities
Increase (decrease) in reinsurance payables
Increase (decrease) in other liabilities except frominvesting and financing activities
Others, net
SubtotalInterest, dividends and other income received
Interest paid
Dividends to policyholders paid
Income taxes (paid) refunded
Net cash provided by (used in) operating activities
II. Cash flows from investing activities
Purchases of monetary claims bought
Proceeds from sales and redemptions of monetaryclaims bought
Purchases of securities
Proceeds from sales and redemptions of securities
Disbursements for loans
Proceeds from collections of loans
Proceeds from derivative financial instruments
Increase (decrease) in payables under securities
borrowing transactions
Others, net①Total of investing activities[I+①]
Purchases of tangible fixed assets
Proceeds from sales of tangible fixed assets
Others, net
Net cash provided by (used in) investing activities
III. Cash flows from financing activities
Redemption of debt borrowing
Proceeds from issuance of bonds
Redemption of bonds
Payment of interest on foundation funds
Dividends paid to non-controlling interests
Others, net
Net cash provided by (used in) financing activities
IV. Net increase (decrease) in cash and cash equivalents
V. Cash and cash equivalents at the beginning of the year
VI. Cash and cash equivalents at the end of the year

2022
¥

¥

2021

25,687
5,511
12,811
1,149
3,453(53,812)3
141(1,008)2,530(120,142)(1,833)
2,510
4,876(3,067)(636)(5,801)¥

2022

26,620
5,503
11,905
2,971(806)(48,624)
3
10(1,677)2,450(117,912)(14,976)
8,898
4,470
(387)
952
(540)

$

209
45
104
9
28
(439)
0
1
(8)
20
(981)
(14)
20
39
(25)
(5)
(47)

(3,396)95(2,837)
117

(27)
0

(437)
4,050
(127,314)
121,824(5,178)(3,562)(11,462)(25,694)

2,312(4,344)(125,891)
124,006(4,343)(3,820)(9,286)(19,335)(3)
33(1,040)
995
(42)
(29)
(93)
(209)

–

(93)

–

2,573
(438,244)
559,515(55,639)
50,961(49,969)

1,899(415,682)
441,355(41,265)
115,364(47,257)

21(3,580)
4,571
(454)
416
(408)

737
(1,133)68,801
43,106(8,703)
8,084(11,328)
56,854(884)(485)
52,94933,614(10,079)
1,501(9,608)34,763

6
(9)
562
352
(71)
66
(92)
464

–
15,000(40,349)(4,089)(36)(803)(30,279)880
157,149
158,030(10,000)
39,477–(4,081)(38)(863)
24,49439,922
117,227
157,149

–
122
(329)
(33)
(0)
(6)
(247)
7
1,284
1,291

¥

$

35

9. Consolidated Financial Statements

Notes to Consolidated Financial Statements
Asahi Mutual Life Insurance Company and its Consolidated Subsidiaries

I. Presentation of Consolidated Financial Statements
1. Basis of Presentation
The accompanying consolidated financial statements have been prepared from the accounts maintainedby Asahi Mutual Life Insurance Company (the “Company”) and its consolidated subsidiaries in accordancewith the provisions set forth in the Insurance Business Act of Japan and its related rules and regulations
applicable to the mutual life insurance industry and in conformity with accounting principles generally
accepted in Japan, which are different in certain respects from accounting principles generally accepted incountries and jurisdictions other than Japan.
In addition, the notes to the consolidated financial statements include information which is not
required under accounting principles generally accepted in Japan but is presented herein as additional
information.
Amounts of less than one million yen have been eliminated. As a result, total amounts in yen shown herein
do not necessarily agree with the sum of the individual amounts.
The Insurance Business Act shall prescribe the disclosure of a single fiscal year. The Company provides
the disclosure of comparative financial information corresponding to each comparative fiscal year in thepresented financial statements for use by readers outside Japan.
In preparing the accompanying consolidated financial statements, certain reclassifications have been
made to the consolidated financial statements issued domestically in order to present them in a format
which is more familiar to readers outside Japan.

2. U.S. Dollar Amounts
The translations of yen amounts into U.S. dollar amounts are included solely for the convenience of thereader and have been made, as a matter of arithmetical computation only, at the rate of ¥122.39 = US$1.00,
the effective rate of exchange at the balance sheet date of March 31, 2022.
The translations should not be construed as representations that such yen amounts have been or could in
the future be, converted into U.S. dollars at that or any other rate.

3. Principles of Consolidation(1) Scope of consolidation
The consolidated subsidiaries as of March 31, 2022 are listed below:
Info Techno Asahi Co., Ltd.
Asahi Life Asset Management Co., Ltd.
Asahi Natixis Investment Managers Co., Ltd.
Nanairo Life Insurance Co., Ltd.
The consolidated subsidiaries as of March 31, 2021 are listed below:
Info Techno Asahi Co., Ltd.
Asahi Life Asset Management Co., Ltd.
Asahi Natixis Investment Managers Co., Ltd.
Asahi NewCo Preparatory Co., Ltd.
Asahi NewCo Preparatory Co., Ltd., which was newly established by the Company in the fiscal year
ended March 31, 2021 and renamed as Nanairo Life Insurance Co., Ltd. on April 1, 2021, was includedin the scope of consolidation for the fiscal year ended March 31, 2021.
The major unconsolidated subsidiary is Asahi Real Estate Management Co., Ltd.
Each non-consolidated subsidiary is small in scale in terms of total assets, amount of sales, net income
and surplus for the fiscal year ended March 31, 2022. As such non-consolidated subsidiaries are not

36

Asahi Mutual Life Insurance Company Annual Report 2022

9. Consolidated Financial Statements

considered to materially affect any reasonable determination as to the financial position and result of
operation of the Companyʼs group, these companies are excluded from the consolidation.
(2) Application of equity method
Unconsolidated subsidiaries (such as Asahi Real Estate Management Co., Ltd, etc.) are immaterial
in terms of their impact on consolidated net income and surplus, and also immaterial as a whole,
therefore, the equity method is not applied.
(3) Fiscal year-end of consolidated subsidiaries
The fiscal year-end of the consolidated subsidiaries is March 31.
(4) Amortization of goodwill
Goodwill is fully expensed as incurred.

II. Notes to Consolidated Balance Sheets
1. Significant Accounting Policies(1) Valuation methods of securities
The valuation of securities, including deposits and monetary claims bought which are equivalent tosecurities is as follows:i)

Trading securities are stated at fair market value. Costs of sales are determined by the moving
average method.

ii) Held-to-maturity debt securities are stated at amortized cost (straight-line method) determined by
the moving average method.
iii) Policy-reserve-matching bonds, which are in accordance with “Temporary Treatment of Accounting
and Auditing Concerning Policy-reserve-matching Bonds in Insurance Industry” (Industry Audit
Committee Report No. 21 issued by the Japanese Institute of Certified Public Accountants(“JICPA”)), are stated at amortized cost (straight-line method) determined by the moving averagemethod.
iv) Investments in unconsolidated subsidiaries and affiliates not accounted for under the equity
method are stated at cost.
v) Available-for-sale securities except for the following are stated at fair market value based on themarket prices at the balance sheet date, of which costs of sales are determined by the moving
average method. Available-for-sale securities, of which public and corporate bonds including foreign
bonds with the difference between acquisition cost and face value considered as an adjustment
of interest, are stated at amortized cost (straight-line method) determined by the moving averagemethod. Stocks and others without a market price are stated at cost determined by the moving
average method. Net unrealized gains or losses on these available-for-sale securities, net of tax,
are recorded as a separate component of net assets.
Note for the fiscal year ended March 31, 2021
Available-for-sale securities with fair market value except for the following are stated at fair market
value based on the market prices at the end of the fiscal year. Available-for-sale securities with fairmarket value, of which domestic stocks, domestic stock exchange-traded funds, domestic listed
real estate investment trusts, foreign stock exchange-traded funds for which hedge accounting
is not applied, foreign bond exchange-traded funds for which hedge accounting is not appliedand foreign currency-denominated bonds for which hedge accounting is not applied, are stated
at fair market value based on the average of the market prices during the final month of the fiscal
year. Costs of sales are determined by the moving average method. Available-for-sale securities
with extreme difficulty of measuring fair market value, of which public and corporate bonds
including foreign bonds with the difference between acquisition cost and face value considered
as an adjustment of interest, are stated at amortized cost (straight-line method) determined by
the moving average method. The other securities are stated at cost determined by the moving

37

9. Consolidated Financial Statements

average method. Net unrealized gains or losses on these available-for-sale securities, net of tax,
are recorded as a separate component of net assets.
(2) Policy-reserve-matching bonds
The Company classifies bonds held with the aim of matching the duration to outstanding insurance
liabilities within the sub-groups (categorized by insurance type, investment policy and other factors)of individual life insurance and individual annuities as policy-reserve-matching bonds in accordancewith “Temporary Treatment of Accounting and Auditing Concerning Policy-reserve-matching Bonds inInsurance Industry” (Industry Audit Committee Report No. 21 issued by the JICPA).
Since the fiscal year ended March 31, 2022, the Company changed its liability cash flow, which is thepremise of assessing the duration to outstanding insurance liabilities, from a “Term of future 30 years”
to a “Whole period” for the sub-group including Individual life Insurance and Individual Annuities(excluding Whole Life Insurance with variable interest rate accumulation, Accumulation Insurance withvariable interest rates and New Single Premium Individual Annuity effective on and after April 2, 2012).
This change did not have any effects on the consolidated balance sheet and consolidated statementof income as of and for the fiscal year ended March 31, 2022.
(3) Valuation methods of derivative financial instruments
Derivative financial instruments are stated at fair market value.
(4) Revaluation of land
The Company revalued the land for business purposes based on the Act on Revaluation of Land (ActNo. 34 promulgated on March 31, 1998). The difference between fair value and book value resulting
from the revaluation, net of related taxes, is recorded as land revaluation differences as a separate
component of net assets and the related tax is recorded as deferred tax liabilities for revaluation.
■ Date of revaluation: March 31, 2001
■ Method of revaluation as prescribed for in Article 3, Paragraph 3 of the said Act:The calculation is based on the publicly announced appraisal value with certain adjustments set forthin Article 2, Item 1 of the Enforcement Ordinance of the Act on Revaluation of Land (Government
Ordinance No. 119 promulgated on March 31, 1998) or the appraisal value determined by thereal-estate appraiser set forth in Article 2, Item 5 of the said Ordinance with certain reasonableadjustments.
(5) Depreciation of tangible fixed assets
Depreciation of the Companyʼs tangible fixed assets is calculated by the following methods.
■ Tangible fixed assets (excluding lease assets): Declining-balance method
However, buildings are depreciated using the straight-line method.
■ Lease assets related to finance lease transactions that do not transfer ownership: Straight-line
method over the lease term with no residual value(6) Foreign currency translation
Foreign currency-denominated assets and liabilities (excluding the shares of unconsolidated
subsidiaries and affiliates) are translated into Japanese yen at the effective exchange rate prevailing at
the balance sheet date.
Note for the fiscal year ended March 31, 2021
Foreign currency-denominated assets and liabilities (excluding the shares of unconsolidated
subsidiaries and affiliates) are translated into Japanese yen at the effective exchange rate prevailing at
the balance sheet date, except for foreign stock exchange-traded funds for which hedge accounting
is not applied, foreign bond exchange-traded funds for which hedge accounting is not applied andforeign currency-denominated bonds for which hedge accounting is not applied categorized asavailable-for-sale securities with fair market value. Such securities are translated into Japanese yen at
the average of the effective exchange rate during the final month of the fiscal year.

38

Asahi Mutual Life Insurance Company Annual Report 2022

9. Consolidated Financial Statements(7) Allowance for possible loan losses
Allowance for possible loan losses is provided in accordance with the Companyʼs standards of selfassessment and write-offs and reserves on credit quality:i)

For credit to borrowers who are legally bankrupt such as being in bankruptcy proceedings orcivil rehabilitation (hereinafter “legally bankrupt borrowers”) and who are substantially bankrupt(hereinafter “substantially bankrupt borrowers”), the Company provides the remaining amount ofcredits after the direct write-off described below and the deductions of the amount expected tobe collected through the disposal of collateral or the execution of guarantees.

ii) For credit to borrowers who are not currently bankrupt but have a high risk of bankruptcy (hereinafter“borrowers with high possibility of bankruptcy”), the Company provides the amounts deemed asnecessary considering the borrowersʼ ability to pay, within the amounts after deductions of theamount expected to be collected through the disposal of collateral or the execution of guarantees.
iii) For credit to borrowers other than the above, the Company provides the amounts calculated bymultiplying the book value by the actual ratio of bad debt losses on defaults during a certain past
period.
All credit is assessed by the relevant departments in accordance with the Companyʼs standards ofself-assessment on credit quality. The results of the assessment are reviewed by the audit department,
which is independent of business-related divisions. Subsequently, allowance for possible loan losses isprovided based on the results of these assessments.
For consolidated subsidiaries, the Company records the allowance amounts deemed necessary inaccordance mainly with the Companyʼs standards of self-assessment and write-offs and reserves on
credit quality.
For credit to legally bankrupt borrowers and substantially bankrupt borrowers, the amounts remaining
after deductions of collateral value or the amounts collectible through the execution of guarantees are
written-off directly from the book value as the estimated uncollectible amounts. The amounts writtenoff as of March 31, 2022 and 2021 were ¥24 million (US$0 million) and ¥28 million, respectively.
(8) Accounting for employeesʼ retirement benefits and method of amortizing retirement benefit expenses
Net defined benefit liabilities and assets are presented for the employeesʼ retirement benefits after
deducting pension plan assets from retirement benefit obligations, based on estimated amounts as of
the balance sheet date.
The Company uses the following methods of accounting in relation to retirement benefits.
■ The retirement benefit obligation is attributed to each period by the benefit formula method.
■ Actuarial differences are amortized under the straight-line method over a period of seven years
starting the following year.
■ Prior service cost is charged to income when incurred.
(9) Reserve for price fluctuation
Reserve for price fluctuation is calculated in accordance with Article 115 of the Insurance Business Act.
(10) Accounting for hedging activities
Hedging activities are accounted for in accordance with the “Accounting Standards for Financial
Instruments” (Accounting Standards Board of Japan (“ASBJ”) Statement No. 10).
The Company mainly applies the following hedging activities:
The Company applies deferred hedge accounting and the exceptional accounting treatment (“Tokureishori”) for interest rate swaps used to hedge the cash flow volatility of certain loans.
The Company also applies fair value hedge accounting for hedging activities related to foreignexchange rate fluctuation exposures on certain bonds, investment trusts and others denominated inforeign currencies.
The Company also applies designated hedge accounting (“Furiate-shori”) for currency swaps used
to hedge foreign exchange rate fluctuation exposures on the foreign currency-denominated bonds

39

9. Consolidated Financial Statements

issued by the Company.
The Company also applies designated hedge accounting (“Furiate-shori”) for the foreign currencydenominated transactions other than the above.
The effectiveness of a hedge is mostly assessed by a ratio analysis, comparing the fluctuations in thefair value or cash flows of hedged items and hedging instruments.
(11) Accounting for consumption taxes
The Company and its subsidiaries account for consumption tax and local consumption tax by the
tax-exclusion method. The consumption taxes on certain assets, which are not deductible fromconsumption taxes withheld and that are stipulated to be deferred under the Corporation Tax Act ofJapan, are deferred as prepaid expenses and amortized equally over five years.
Consumption taxes other than deferred consumption taxes are recognized as an expense whenincurred.
(12) Premium and other income (excluding reinsurance revenue)
Premium and other income (excluding reinsurance revenue) are recorded in principle for insurance
policies for which insurance premium has been received and the insurerʼs liability under the insurance
policies or insurance coverage period has commenced by the relevant amounts received.
Of insurance premiums, the portion corresponding to the period that has yet to pass as of the end of
the fiscal year is set aside as policy reserves in accordance with Article 116 of the Insurance BusinessAct and Article 69, Paragraph 1, Item 2 of the Enforcement Regulation of the Insurance Business Act.
(13) Reinsurance revenue
Reinsurance revenue is recorded as reinsurance claims and others received based on the proportion
ceded in reinsurance and others stipulated in the reinsurance contracts in the reporting period when theincome and expenditure for ceded insurance policies (hereinafter “reinsurance ceded”) are recorded.
For modified coinsurance, ceding commissions which are received as part of amounts equivalent to
new policy acquisition costs for reinsurance ceded are recorded as reinsurance revenue, while the sameamounts are recorded as reinsurance receivables as unamortized ceding commissions and amortizedover the period of the reinsurance contracts.
(14) Claims and other payments (excluding reinsurance premiums)
Claims and other payments (excluding reinsurance premiums) are recorded for insurance policies forwhich amounts calculated under policy conditions have been paid in the occurrence of insured events
under the policy conditions by the relevant amounts paid.
In accordance with Article 117 of the Insurance Business Act and Article 72 of the Enforcement
Regulation of the Insurance Business Act, reserve for outstanding claims is set aside for claims, etc.
which is not recorded as payment of claims, etc. but for which the Company has payment obligationor the occurrence of insured events has not been reported but the Company finds that insured events
have already occurred, as of the end of the fiscal year.
(15) Reinsurance premiums
Reinsurance premiums are recorded as reinsurance premiums paid based on the proportion ceded inreinsurance and others stipulated in the reinsurance contracts in the reporting period when the income
and expenditure for reinsurance ceded are recorded.
Part of policy reserves and reserve for outstanding claims corresponding to insurance policies whichhave been reinsured is not set aside in accordance with Article 71, Paragraph 1 and Article 73, paragraph
3 of the Enforcement Regulation of the Insurance Business Act.
(16) Policy reserves
Policy reserves are calculated as stated in accordance with the methods stated in the statement ofcalculation procedures for insurance premiums and policy reserves (Article 4, Paragraph 2, Item 4 of
the Insurance Business Act) pursuant to Article 116, Paragraph 1 of the Insurance Business Act, for40

Asahi Mutual Life Insurance Company Annual Report 2022

9. Consolidated Financial Statements

insurance policies under which the insurerʼs liability has started as of the end of the fiscal year, in
preparation for the performance of future obligations under the insurance policies.
Of policy reserves, the premium reserves at the end of the fiscal year are calculated by the following
method:In regard to the policies subject to the standard policy reserves, the method as prescribed by theCommissioner of Financial Services Agency (Japanese Ministry of Finance Public Notice No. 48, 1996)
is applied.
In regard to the policies not subject to the standard policy reserves, the net level premium method isapplied.
Regarding policy reserves, the chief actuary checks that policy reserves are appropriately accumulated
in each fiscal year, pursuant to Article 121, Paragraph 1 of the Insurance Business Act and Article 80 of
the Enforcement Regulation of the Insurance Business Act.
Contingency reserves included in policy reserves are set aside in accordance with Article 116 of the
Insurance Business Act and Article 69, Paragraph 1, Item 3 of the Enforcement Regulation of the
Insurance Business Act to cover risks that may accrue in the future in order to ensure the performanceof future obligations under insurance policies.
(17) Impairment losses of tangible fixed assets
Impairment losses of the Companyʼs tangible fixed assets are calculated by the following method.
i)

Calculation method
Real estate and other assets used for insurance business operations are classified as one asset
group as a whole. Other assets such as real estate for rent, real estate not in use and real estatescheduled to be sold are classified as one group individually. As for real estate used for multiple
purposes, the asset group to which the real estate belongs is decided depending on usage rate
and others.
The Company identifies indications of impairment on each asset group when earnings frombusiness operations using the asset group continuously become negative.
As for asset groups for which indications of impairment are identified, when total amounts ofundiscounted net future cash flows from the asset groups are less than their book values, theCompany recognizes impairment losses and reduces the book values to their recoverable amounts.
The recoverable amounts of real estate and other assets for insurance business operation and realestate for rent are determined at value in use or net realizable value. The recoverable amounts ofreal estate not in use and real estate scheduled to be sold are determined at net realizable value.
Value in use is determined as the discounted present value of estimated net future cash flows anddiscount rate used in the calculation is based on the cost of capital of the Company.
Net realizable value is calculated based on the appraisal value in accordance with “Real EstateAppraisal Standards” or the publicly announced appraisal value after deducting expected disposal
costs.

ii) Key assumptions
Key assumptions for the estimated net future cash flows which are used in recognizing impairment
losses and calculating value in use are usage plans considering current status of use of asset
groups, including tenancy rates, rents and others. These assumptions may be affected by economic
condition and changes specific to asset groups.
iii) Effects on consolidated financial statements for the following fiscal year
While the Company considers key assumptions for the estimated net future cash flows which areused in recognizing impairment losses and calculating value in use are best estimate based on
available information including external information, impairment losses may occur in the following
fiscal year due to future uncertainties.
Furthermore, the appraisal value in accordance with “Real Estate Appraisal Standards” may beaffected by future real estate market trends. In case that net realizable value decreases as a result,
impairment losses may occur in the following fiscal year.

41

9. Consolidated Financial Statements(18) Software
Capitalized software for internal use owned by the Company and its subsidiaries (included in intangible
fixed assets in the consolidated balance sheets) is amortized using the straight-line method over theestimated useful lives.

2. Accounting Changes
The Company has applied “Accounting Standard for Fair Value Measurement” (ASBJ Statement No. 30,
issued on July 4, 2019) and others from the fiscal year ended March 31, 2022. In accordance with thetransitional treatment set forth in Paragraph 19 of "Accounting Standard for Fair Value Measurement"
and Paragraph 44-2 of "Accounting Standard for Financial Instruments" (ASBJ Statement No.10, July4, 2019), the Company has applied new accounting policies prospectively. As a result, available-for-salesecurities, of which domestic listed stocks, domestic stock exchange-traded funds, domestic listed realestate investment trusts, foreign stock exchange-traded funds for which hedge accounting is not applied,foreign bond exchange-traded funds for which hedge accounting is not applied and foreign currencydenominated bonds for which hedge accounting is not applied, are changed to be stated at fair value
based on the market prices at the balance sheet date from fair value based on the average of the market
prices during the final month of the fiscal year.
In determining to recognize impairment losses on available-for-sale securities, the Company has used fairvalue based on the average of market prices during the final month of fiscal year as before.

3. Accounting Standards Issued but Not Yet Effective
The Company and part of its subsidiaries made a request for approval for the application of the group tax
sharing system in December 2021 and it is decided to be applied from the fiscal year ending March 31,
2023.
The accounting standard and relevant implementation guidance issued by the fiscal year-end but not yet
effective is the “Practical Solution on the Accounting and Disclosure Under the Group Tax Sharing System”(ASBJ PITF No.42, issued on August 12, 2021) and its contents are as follows:(i) Overview
The practical solution was issued to stipulate the accounting and disclosure treatment of corporatetax, local corporate tax and tax effect accounting when applying the group tax sharing system,
following the “Act for Partial Amendment of the Income Tax Act, etc.” (Act No.8, 2020) enacted
on March 27, 2020 which requires revision of the consolidated taxation system and transition to
the group tax sharing system.
(ii) Schedule date of application
The practical solution is scheduled to be applied from the beginning of the fiscal year ending
March 31, 2023.
(iii) Effects of application of the practical solution
The effects of the application are under assessment at the time of preparing these consolidated
financial statements.
Note for the fiscal year ended March 31, 2021
The accounting standards and relevant implementation guidance issued by the fiscal year-end but not yet
effective are as follows:■ “Accounting Standard for Fair Value Measurement” (ASBJ Statement No. 30, issued on July 4, 2019)■ “Implementation Guidance on Accounting Standard for Fair Value Measurement” (ASBJ Guidance
No. 31, issued on July 4, 2019)■ “Accounting Standard for Financial Instruments” (ASBJ Statement No. 10, revised on July 4, 2019)(i) Overview
In these accounting standards and relevant implementation guidance, the guidance on themethods for measuring fair values of financial instruments are set to enhance comparability

42

Asahi Mutual Life Insurance Company Annual Report 2022

9. Consolidated Financial Statements

between Japanese accounting standards and international accounting standards.
(ii) Schedule date of application
The above revisions are scheduled to be applied from the beginning of the fiscal year ending
March 31, 2022.
(iii) Effects of application of the Accounting Standards and relevant implementation guidance
The effects of the application are under assessment at the time of preparing these consolidated
financial statements.

4. Changes in Reporting Method
Following the revision of the Enforcement Regulation of the Insurance Business Act, claims to be disclosed
are classified in the revised categories in the following “Note 9. Claims”.

5. Financial Instruments
Asset management of the general accounts other than the separate accounts stipulated in Article 118,
Paragraph 1 of the Insurance Business Act is conducted based on the following principles.
■ For accumulation whole life with variable interest rates, accumulation insurance with variableinterest rates and new single premium individual annuities which have an effective date on or after
April 2, 2012, the Company mainly invests in domestic bonds, engaging in matching asset liability
management, or Matching ALM, which aims at matching the duration to outstanding insurance
liabilities to avoid interest rate fluctuation risks.
■ For individual life insurance and individual annuities other than above, the Company holds yendenominated fixed income investments, including bonds and loans, as the core of its asset portfolio.
The Company also holds domestic stocks, foreign securities and real estate assets to enhance its
profitability.
Derivatives are mainly used to hedge market price fluctuation risk and exchange rate fluctuation risk
regarding securities and exchange rate fluctuation risk related to the foreign currency-denominated bonds
issued by the Company. As the major financial instruments, securities are exposed to market risk and credit
risk, loans are exposed to credit risk and exchange rate fluctuation risk, and derivatives are exposed tomarket risk and credit risk.
In managing market risks, the following two methods are used. One is the quantitative risk managementof securities etc. using the Value at Risk (“VaR”) method and the other is the risk management by stress test
and sensitivity analysis which analyze the effect on the Companyʼs whole portfolio, simulating scenarios ofdeteriorating market environments. This is for the purpose of managing an appropriate asset allocation
within the ranges of acceptable risks.
In managing credit risks, the Company quantifies the credit risks of entire portfolio through VaR method
and controls the amount of risks within an acceptable range. Furthermore, the Company assigns in-housecredit ratings to our borrowers in accordance with the creditworthiness of each borrower. Strict credit
research of each borrower before lending as well as following up on any changes of creditworthiness ofeach borrower after lending are implemented by Risk Management Department, which is independent of
the departments executing investments and lending. Maximum limits of credit are set up for each borrowerin accordance with its credit risks to avoid the concentration of credit risks on specific corporations andspecific corporation groups. Through all these measures, the Company endeavors to develop high quality
portfolio.
The balance sheet amounts, fair values and the differences between those of major financial assets andliabilities as of March 31, 2022 were as follows. The following table does not include cash and deposits, callloans and payables under securities borrowing transactions which are mostly settled in a short term andtheir fair values approximate their book values.

43

9. Consolidated Financial Statements

Millions of Yen
2022
As of March 31
Monetary claims bought
Held-to-maturity debt securities
Available-for-sale securities
Securities
Trading securities
Held-to-maturity debt securities
Policy-reserve-matching bonds
Available-for-sale securities
Loans
Policy loans
Industrial and consumer loans
Total assets
Bonds payable
Loans payable
Total liabilities
Derivative financial instruments
Hedge accounting not applied
Hedge accounting applied

Balance Sheet
Amount¥Fair Value

22,534
21,577957
4,470,196
26,601
280,0702,028,714
2,134,809
311,416
32,199279,217
4,804,147
102,424
41,000143,424(89,485)(2,555)(86,930)¥

24,25523,297957
4,630,893
26,601
310,342
2,159,139
2,134,809
317,500
32,199285,301
4,972,648
103,200
42,260145,460(89,485)(2,555)(86,930)

Difference
¥

1,720
1,720
–
160,696–
30,272
130,424
–
6,083
–
6,083
168,501
776
1,260
2,036
–
–
–

* Assets and liabilities generated by derivative financial instruments are offset and presented net. Net liabilities in total are presented
in parentheses.

Millions of U.S. Dollars
2022
As of March 31
Monetary claims bought
Held-to-maturity debt securities
Available-for-sale securities
Securities
Trading securities
Held-to-maturity debt securities
Policy-reserve-matching bonds
Available-for-sale securities
Loans
Policy loans
Industrial and consumer loans
Total assets
Bonds payable
Loans payable
Total liabilities
Derivative financial instruments
Hedge accounting not applied
Hedge accounting applied

Balance Sheet
Amount$184
176
7
36,524217
2,288
16,575
17,442
2,544
263
2,281
39,252
836
334
1,171
(731)
(20)
(710)

Fair Value
$

198
190
7
37,837217
2,535
17,641
17,442
2,594
263
2,331
40,629
843
345
1,188
(731)
(20)
(710)

Difference
$

14
14
–
1,312
–
247
1,065
–
49
–
49
1,376
6
10
16
–
–
–

* Assets and liabilities generated by derivative financial instruments are offset and presented net. Net liabilities in total are presented
in parentheses.

Unlisted stocks and others, including investments in subsidiaries and affiliates, without market prices are
not included in the table above. The amount of the unlisted stocks and others, including investments in
subsidiaries and affiliates, reported in the consolidated balance sheet was ¥22,156 million (US$181 million)
as of March 31, 2022.
Investments in partnerships and others for which transitional measures are applied in accordance with
Paragraph 27 of “Implementation Guidance on Accounting Standard for Fair Value Measurement”(ASBJ Guidance No. 31, issued on July 4, 2019) are not included in the table above. The amount of theinvestments in partnerships and others, reported in the consolidated balance sheet was ¥44,012 million(US$359 million) as of March 31, 2022.

44

Asahi Mutual Life Insurance Company Annual Report 2022

9. Consolidated Financial Statements

Notes for the fiscal year ended March 31, 2021
The balance sheet amounts, fair values and the differences between those of major financial assets andliabilities as of March 31, 2021 were as follows:
Millions of Yen
2021
As of March 31
Cash and deposits
Call loans
Monetary claims bought
Trading securities
Held-to-maturity debt securities
Policy-reserve-matching bonds
Available-for-sale securities
Securities
Trading securities
Held-to-maturity debt securities
Policy-reserve-matching bonds
Available-for-sale securities
Loans
Policy loans
Industrial and consumer loans
Total assets
Bonds payable
Payables under securities borrowing transactions
Loans payable
Total liabilities
Derivative financial instruments
Hedge accounting not applied
Hedge accounting applied

Balance Sheet
Amount¥44,149113,000
25,094–
24,125–969
4,577,687
26,307
296,880
2,039,060
2,215,438
303,451
35,182
268,268
5,063,382
127,773
178,81041,000347,584(31,522)(1,875)(29,646)

Fair Value¥

44,149113,000
27,415–26,446–969
4,830,694
26,307
333,953
2,254,994
2,215,438
311,163
35,182275,980
5,326,422
130,313
178,81042,548351,673(31,522)(1,875)(29,646)

Difference
¥

–
–
2,321
–
2,321
–
–
253,006–
37,073215,933
–
7,712
–
7,712
263,040
2,540
–
1,548
4,088
–
–
–

* Assets and liabilities generated by derivative financial instruments are offset and presented net. Net liabilities in total are presented
in parentheses.

(1) Securities including deposits and monetary claims bought which are treated as securities based on“Accounting Standards for Financial Instruments” (ASBJ Statement No. 10)
As for available-for-sale securities of which market value is readily available, domestic stocks, domestic
stock exchange-traded funds, domestic listed real estate investment trusts, foreign stock exchangetraded funds for which hedge accounting is not applied, foreign bond exchange-traded funds forwhich hedge accounting is not applied and foreign currency-denominated bonds for which hedge
accounting is not applied are stated at the average of the market value during the final month of
the fiscal year. Available-for-sale securities of which market value is readily available excluding thesecurities mentioned above are stated at the market value at the balance sheet date.
Other securities of which market value is readily available are stated at market value at the balance
sheet date.
Unlisted stocks and others, including investments in subsidiaries and affiliates, of which market value is
not readily available are not subject to fair value disclosure and are therefore not included in the table
above because it is regarded as extremely difficult to determine their fair value.
The amount of the unlisted stocks and others, including investments in subsidiaries and affiliates,
reported in the consolidated balance sheet was ¥21,164 million as of March 31, 2021.

45

9. Consolidated Financial Statements(2) Loans and loans payableAs credit exposure for policy loans without specific repayment periods is limited to the amount of
the cash surrender value, the Company and its subsidiaries consider book value as fair value with theassumption that fair value approximates book value in light of factors such as projected repayment
period and interest terms.
As for industrial and consumer loans and loans payable, the fair value of loans is primarily statedat theoretical prices calculated by discounting the future cash flows to the present value. The fairvalue of loans to legally bankrupt borrowers, substantially bankrupt borrowers and borrowers with highpossibility of bankruptcy is stated at the amounts by deducting estimated losses from the book value
before direct write-offs.
(3) Bonds payable
The fair value of bonds payable is based on the market value, etc. as of March 31, 2021.
(4) Payables under securities borrowing transactions
The Company considers book value as fair value with the assumption that fair value approximatesbook value.
(5) Derivative financial instruments
The fair values of stock options and currency options traded over the counter are based on the quoted
prices offered by counterparty financial institutions.
The fair values of foreign currency forward contracts are stated at theoretical prices based on the TTM
at the balance sheet date.
Regarding the derivative transactions for which designated hedge accounting (“Furiate-shori”) ofcurrency swaps is applied, these fair values are included in bonds payable since they are treated
together with hedged bonds payable.

6. Matters concerning fair value of major financial instruments and breakdown by input level
Fair values of financial instruments are categorized into the following three levels in accordance with theobservability and significance of the inputs used to measure the fair value.
Level 1: Fair values measured by unadjusted quoted prices in active markets for identical assets or liabilities
Level 2: Fair values measured by inputs which are directly or indirectly observable other than Level 1 inputs
Level 3: Fair values measured by significant unobservable inputs
When several inputs that have significant impact on fair value measurement are used and those inputs
are categorized into different levels, the fair value is categorized into the lowest priority level for fair value
measurement among the levels to which each of the inputs belongs.

46

Asahi Mutual Life Insurance Company Annual Report 2022

9. Consolidated Financial Statements(1) Financial assets and liabilities recorded at fair values on the consolidated balance sheet
Millions of Yen
2022
As of March 31

Fair Value
Level 1

Monetary claims bought
Available-for-sale securities
Securities*1
Trading securities
National government bonds and local
government bonds
Corporate bonds
Domestic stocks
Foreign stocks
Foreign bonds
Available-for-sale securities
National government bonds and local
government bonds
Corporate bonds
Domestic stocks
Foreign bonds
Total assets
Derivative financial instruments*2
Currency-related
Stock-related¥––
580,435
24,719Level 2¥––
1,169,127
1,882¥

Level 3957
957
29,482
–

Total
¥

957
957
1,779,045
26,601

5,830
–
7,914
8,269
2,705
555,716

–
902
–
–
979
1,167,245

–
–
–
–
–
29,482

5,830
902
7,914
8,269
3,684
1,752,444

39,829–413,036
102,850
580,435–––

685
426,840–
739,719
1,169,127(89,755)(89,755)––––
29,48230,440270–
270

40,514
426,840
413,036
872,053
1,780,003(89,485)(89,755)
270*1 Investment trusts for which transitional measures are applied in accordance with Paragraph 26 of “Implementation Guidance on
Accounting Standard for Fair Value Measurement” (ASBJ Guidance No. 31, issued on July 4, 2019) are not included in the table
above. The balance sheet amount of the investment trusts was ¥382,365 million (US$3,124 million) as of March 31, 2022.
*2 Assets and liabilities generated by derivative financial instruments are offset and presented net. Net liabilities in total arepresented in parentheses.

Millions of U.S. Dollars
2022
As of March 31

Fair Value
Level 1

Monetary claims bought
Available-for-sale securities
Securities*1
Trading securities
National government bonds and local
government bonds
Corporate bonds
Domestic stocks
Foreign stocks
Foreign bonds
Available-for-sale securities
National government bonds and local
government bonds
Corporate bonds
Domestic stocks
Foreign bonds
Total assets
Derivative financial instruments*2
Currency-related
Stock-related

$

–
–
4,742
201

Level 2
$

–
–
9,552
15

Level 3
$

7
7
240
–

Total
$

7
7
14,535
217

47
–
64
67
22
4,540

–
7
–
–
8
9,537

–
–
–
–
–
240

47
7
64
67
30
14,318

325
–
3,374
840
4,742
–
–
–

5
3,487
–
6,043
9,552
(733)
(733)
–

–
–
–
240
248
2
–
2

331
3,487
3,374
7,125
14,543
(731)
(733)
2

*1 Investment trusts for which transitional measures are applied in accordance with Paragraph 26 of “Implementation Guidance on
Accounting Standard for Fair Value Measurement” (ASBJ Guidance No. 31, issued on July 4, 2019) are not included in the table
above. The balance sheet amount of the investment trusts was ¥382,365 million (US$3,124 million) as of March 31, 2022.
*2 Assets and liabilities generated by derivative financial instruments are offset and presented net. Net liabilities in total arepresented in parentheses.

47

9. Consolidated Financial Statements(2) Financial assets and liabilities not recorded at fair values on the consolidated balance sheet
Millions of Yen
2022
As of March 31

Fair Value
Level 1

Monetary claims bought
Held-to-maturity debt securities
Securities
Held-to-maturity debt securities
National government bonds and local
government bonds
Corporate bonds
Foreign bonds
Policy-reserve-matching bonds
National government bonds and local
government bonds
Corporate bonds
Loans
Policy loans
Industrial and consumer loans
Total assets
Bonds payable
Loans payable
Total liabilities¥––
1,752,190
36,939Level 2¥––592,381
148,494¥

Level 323,29723,297
124,909
124,909¥

Total
23,29723,2972,469,481
310,342

36,939––1,715,251–
92,90055,594
443,887––
124,909–36,93992,900180,503
2,159,139

1,715,251––––
1,752,190–––

51,082392,804–––
592,381
103,200–
103,200––
317,500
32,199285,301
465,707–42,26042,2601,766,334
392,804
317,500
32,199285,3012,810,279
103,200
42,260145,460

Millions of U.S. Dollars
2022
As of March 31

Fair Value
Level 1

Monetary claims bought
Held-to-maturity debt securities
Securities
Held-to-maturity debt securities
National government bonds and local
government bonds
Corporate bonds
Foreign bonds
Policy-reserve-matching bonds
National government bonds and local
government bonds
Corporate bonds
Loans
Policy loans
Industrial and consumer loans
Total assets
Bonds payable
Loans payable
Total liabilities

48

Asahi Mutual Life Insurance Company Annual Report 2022$––
14,316301

Level 2
$

–
–
4,840
1,213

$

Level 3
190
190
1,020
1,020

Total
$

190
190
20,177
2,535

301
–
–
14,014

–
759
454
3,626

–
–
1,020
–

301
759
1,474
17,641

14,014––––
14,316
–
–
–

417
3,209
–
–
–
4,840
843
–
843

–
–
2,594
263
2,331
3,805
–
345
345

14,432
3,209
2,594
263
2,331
22,961
843
345
1,188

9. Consolidated Financial Statements(3) Description of the evaluation methods and inputs used to measure fair valuei)Securities including monetary claims bought which are treated as securities based on “AccountingStandard for Financial Instruments” (ASBJ Statement No. 10)
Fair values of securities for which unadjusted quoted market prices in active markets are available
are categorized as Level 1, which mainly include listed stocks and government bonds. In the casethe market is inactive even if the quoted market price is available, those securities are categorized
as Level 2, which mainly include corporate bonds and foreign bonds. In the case the quoted market
price is not available, fair values are measured by evaluation methods such as discounting future
cash flows. In evaluation, the Company maximizes the use of observable inputs including swap
rates, interest rate swap spreads, currency basis and others. When significant unobservable inputs
are used to measure fair values, those securities are categorized as Level 3.
Fair values of investment trusts are measured at the disclosed net asset value and others.
Investment trusts for which transitional measures are applied in accordance with Paragraph 26 of“Implementation Guidance on Accounting Standard for Fair Value Measurement” (ASBJ Guidance
No. 31, issued on July 4, 2019) are not categorized into any level.

ii) Loans
As credit exposure for policy loans without specific repayment periods is limited to the amount of
the cash surrender value, the Company considers book value as fair value with assumption that fairvalue approximates book value in light of factors such as projected repayment period and interest
terms. Policy loans are categorized as level 3.
As for industrial and consumer loans, the fair value of loans is stated at theoretical prices calculatedby discounting the future cash flows to the present value by type of loan, using market interest
rates with some adjustments based on internal credit rating. Industrial and consumer loans are
categorized as level 3. The fair value of loans to legally bankrupt borrowers, substantially bankrupt
borrowers and borrowers with high possibility of bankruptcy is stated at the amounts by deducting
estimated losses from the book value before direct write-offs. Loans to legally bankrupt borrowers,
substantially bankrupt borrowers and borrowers with high possibility of bankruptcy are categorized
as level 3.
iii) Bonds payable
The fair value of bonds payable issued by the Company is stated at fair market value. Bonds
payable issued by the Company are categorized as level 2. The fair value of bonds payable forwhich designated hedge accounting (“Furiate-shori”) for currency swaps are applied is stated atfair market value added by the fair value of currency swaps. The Company adopts prices obtained
from external information venders as the fair value of currency swaps.
iv) Loans payableAs for loans payable, the fair value of loans is stated at theoretical prices calculated by discounting
the future cash flows to the present value, using market interest rates with some adjustments basedon the Companyʼs credit risk. Loans payable are categorized as level 3.
v) Derivative financial instruments
As for derivative financial instruments, the fair values of foreign currency forward contracts arestated at theoretical prices calculated by the Company based on the TTM at the balance sheet
date. The fair values of currency options, stock options and interest rate swaptions are stated at thequoted prices offered by counterparty financial institutions.
In evaluation of derivative financial instruments, the Company maximizes the use of observable
inputs. In the case unobservable inputs are not used or impact of unobservable inputs are notmaterial, derivative financial instruments are categorized as level 2. In the case significant
unobservable inputs are used, derivative financial instruments are categorized as level 3.

49

9. Consolidated Financial Statements(4) Quantitative information about financial assets and liabilities measured and stated in the consolidatedbalance sheet at fair value and categorized as Level 3i)Quantitative information on significant unobservable inputs
Quoted prices obtained from third parties are used for fair values categorized as level 3 without
adjustment.

ii) Reconciliation between the beginning and ending balance, and net unrealized gains (losses)
recognized as gains (losses) for the fiscal year
Millions of Yen

For the year ended March 31, 2022

Beginning balance
Gains (losses) and other comprehensive
income for the fiscal year:
Gains (losses) recorded for the fiscal
year*1Other comprehensive income recorded
for the fiscal year*2
Net amount of purchase, sale, issue, andsettlement
Transfer to fair values of Level 3
Transfer from fair values of Level 3*3
Ending balance
Net unrealized gains (losses) on financial
assets and liabilities held at the balance
sheet date among the amount recorded
to gains (losses) for the fiscal year*1

Monetaryclaims bought

Securities

Available-forsale securities

Available-forsale securities

Others(i)
969

Foreign bonds(ii)¥
26,853¥

Derivative
financial
instruments

Total(i) + (ii)

Stock-related¥

27,822

¥

–

16

75

91

(24)

(20)

2,406

2,385

(24)

36

(2,330)(2,293)

–

(28)
–
–
957

10,711–(8,157)29,482

10,682–(8,157)30,440

294
–
–
270

–

2,406

2,406

(24)

*1 Those amounts are included in investment income and investment expenses in the consolidated statement of income.
*2 Those amounts are included in net unrealized gains (losses) on available-for-sale securities, net of tax in other comprehensive
income in the consolidated statement of comprehensive income.
*3 Those amounts are transferred from level 3 to level 2 since it has become possible to obtain observable data. Those transfers
were made at the end of the fiscal year.

Millions of U.S. Dollars

For the year ended March 31, 2022

Beginning balance
Gains (losses) and other comprehensive
income for the fiscal year:
Gains (losses) recorded for the fiscal
year*1Other comprehensive income recorded
for the fiscal year*2
Net amount of purchase, sale, issue, andsettlement
Transfer to fair values of Level 3
Transfer from fair values of Level 3*3
Ending balance
Net unrealized gains (losses) on financial
assets and liabilities held at the balance
sheet date among the amount recorded
to gains (losses) for the fiscal year*1

Monetaryclaims bought

Securities

Available-forsale securities

Available-forsale securities

Others(i)

Foreign bonds
(ii)
$
219

$

7

Derivative
financial
instruments

Total(i) + (ii)

Stock-related
$

227

$

–

0

0

0

(0)

(0)

19

19

(0)

0

(19)

(18)

–

(0)
–
–
7

87
–
(66)
240

87
–
(66)
248

2
–
–
2

–

19

19

(0)

*1 Those amounts are included in investment income and investment expenses in the consolidated statement of income.
*2 Those amounts are included in net unrealized gains (losses) on available-for-sale securities, net of tax in other comprehensive
income in the consolidated statement of comprehensive income.
*3 Those amounts are transferred from level 3 to level 2 since it has become possible to obtain observable data. Those transfers
were made at the end of the fiscal year.

50

Asahi Mutual Life Insurance Company Annual Report 2022

9. Consolidated Financial Statementsiii) Description of the fair value evaluation process
The Company establishes policies and procedures for measuring the fair value in the actuarial andaccounting department and the risk management department. In accordance with these policies
and procedures, the risk management department measures the fair value. The validity of theevaluation methods and inputs used to measure fair value and the appropriateness of categorizationof fair value are verified in the independent division in the risk management department.
In fair value measurement, valuation models in which the nature, characteristics and risks ofindividual assets are most appropriately reflected are used. In addition, when quoted prices
obtained from third parties are used, the validity of the prices is verified by appropriate methods
such as confirmation of evaluation method and used inputs and comparison with the fair values ofsimilar financial instruments.

7. Investments and Rental Properties
The Company holds investment and rental properties such as office buildings in Tokyo and other areas. The
carrying amounts and the fair values of investment and rental properties were ¥239,331 million (US$1,955
million) and ¥283,478 million (US$2,316 million) as of March 31, 2022 and ¥246,901 million and ¥288,948
million as of March 31, 2021, respectively. The fair value is mainly based on the value (including someadjustments using the reference prices) of real estate appraisal report prepared by the external real-estateappraiser in accordance with real estate appraisal standards.

8. Securities Lent under Lending Agreements
The amounts of securities lent under lending agreements were ¥218,367 million (US$1,784 million) and¥265,606 million as of March 31, 2022 and 2021, respectively.

9. Claims
The total amount of claims against bankrupt and quasi-bankrupt obligors, claims with collection risk,delinquent loans three or more months past due and restructured loans, which were included in claims,
was ¥609 million (US$4 million) as of March 31, 2022.
i)

Claims against bankrupt and quasi-bankrupt obligors were ¥453 million (US$3 million) as of March
31, 2022.

ii) Claims with collection risk were ¥70 million (US$0 million) as of March 31, 2022.
iii) Delinquent loans three or more months past due were ¥66 million (US$0 million) as of March 31,
2022.
iv) Restructured loans were ¥20 million (US$0 million) as of March 31, 2022.
Claims against bankrupt and quasi-bankrupt obligors are claims to obligors who are subject to bankruptcy,
corporate reorganization or rehabilitation or other similar proceedings and other obligors in serious
financial difficulties.
Claims with collection risk are claims to obligors with deteriorated financial condition and results ofoperations from which it is unlikely that the principal and interest on the claims will be recovered, excluding
those claims classified as claims against bankrupt and quasi-bankrupt obligors.
Delinquent loans three or more months past due are loans for which interest payments or repayments ofprincipal are delinquent for three months or more from the due dates under the terms of the related loan
agreements, excluding those claims classified as claims against bankrupt and quasi-bankrupt obligors andclaims with collection risk.
Restructured loans are loans for which certain concessions favorable to borrowers, such as interest
reduction or exemptions, rescheduling of due dates of principal or interest payments, waivers of claim
or other terms, have been negotiated for the purpose of assisting and supporting the borrowers in the
restructuring of their businesses. This category excludes claims classified as claims against bankrupt andquasi-bankrupt obligors, claims with collection risk and delinquent loans three or more months past due.
The direct write-offs related to claims decreased the amount of claims against bankrupt and quasi-bankrupt
obligors described above by ¥24 million (US$0 million) as of March 31, 2022.

51

9. Consolidated Financial Statements

Note for the fiscal year ended March 31, 2021

Loans
The total amount of loans to bankrupt borrowers, delinquent loans, delinquent loans three or more months
past due and restructured loans, which were included in loans, was ¥677 million as of March 31, 2021.
i)

Loans to bankrupt borrowers were ¥0 million as of March 31, 2021.

ii) Delinquent loans were ¥563 million as of March 31, 2021.
iii) Delinquent loans three or more months past due were ¥94 million as of March 31, 2021.
iv) Restructured loans were ¥20 million as of March 31, 2021.
Loans to bankrupt borrowers represent loans, excluding the balances already written-off, which meet theconditions prescribed in Article 96, Paragraph 1, Items 3 and 4 of the Enforcement Regulations of the
Corporate Tax Act. Moreover, accruing interest on these loans is not recorded as income after determiningthat principal of or interest on these loans is unlikely to be collected due to the significant delay inrepayment of principal or interest payments or for other reasons.
Accruing interest on delinquent loans is not recorded as income due to the same reasons as describedabove, and delinquent loans exclude loans to bankrupt borrowers and loans for which interest payments
have been suspended and rescheduled to assist and support the borrowers in the restructuring of theirbusinesses.
Delinquent loans three or more months past due are loans for which interest payments or repayments ofprincipal are delinquent for three months or more from the due dates under the terms of the related loan
agreements, excluding those loans classified as loans to bankrupt borrowers and delinquent loans.
Restructured loans are loans for which certain concessions favorable to borrowers, such as interest
reduction or exemptions, rescheduling of due dates of principal or interest payments, waivers of claim
or other terms, have been negotiated for the purpose of assisting and supporting the borrowers in the
restructuring of their businesses. This category excludes loans classified as loans to bankrupt borrowers,
delinquent loans and delinquent loans three or more months past due.
The direct write-offs related to loans decreased the amount of loans to bankrupt borrowers describedabove by ¥3 million as of March 31, 2021.
In addition, the direct write-offs related to loans decreased the amount of delinquent loans describedabove by ¥25 million as of March 31, 2021.

10. Accumulated Depreciation of Tangible Fixed Assets
Accumulated depreciation of tangible fixed assets totaled ¥286,793 million (US$2,343 million) and ¥285,628
million as of March 31, 2022 and 2021, respectively.

11. Separate Accounts
Total assets in separate accounts provided for in Article 118 of the Insurance Business Act were ¥28,175
million (US$230 million) and ¥28,078 million as of March 31, 2022 and 2021, respectively. The amounts ofseparate account liabilities were the same as separate account assets.

12. Reserve for Dividends to Policyholders
Millions of
U.S. Dollars

Millions of Yen
For the years ended March 31
Balance at the beginning of the fiscal year
Transfer to reserve from surplus in the previous fiscal year
Dividends to policyholders paid out during the fiscal year
Increase in interest
Balance at the end of the fiscal year

52

Asahi Mutual Life Insurance Company Annual Report 2022

2022
¥

¥

30,050
2,153
3,562
3
28,6442021¥¥

32,073
1,794
3,820
3
30,050

2022
$

$

245
17
29
0
234

9. Consolidated Financial Statements

13. Stocks of Unconsolidated Subsidiaries and affiliates
The amounts of stocks of unconsolidated subsidiaries and affiliates the Company held as of March 31, 2022
and 2021 were ¥7,888 million (US$64 million) and ¥7,878 million, respectively.

14. Pledged Assets
Assets pledged as collateral as of March 31, 2022 and 2021 were securities in the amount of ¥80,591 million(US$658 million) and ¥32,653 million, respectively.

15. Unamortized Ceding Commissions
The amount of unamortized ceding commissions for reinsurance contracts stipulated in Article 1, Paragraph
5 of the Japanese Ministry of Finance Public Notice No. 50, 1996 for the fiscal year ended March 31, 2022
was ¥6,391 million (US$52 million).

16. Assets with Rights to Sell
The Company has the legal right to sell or collateralize securities borrowed under loan agreements.
The market values of these assets that were not sold or pledged as collateral as of March 31, 2022 and2021 were ¥25,709 million (US$210 million) and ¥72,634 million, respectively. No assets were pledged ascollateral as of March 31, 2022 and 2021.

17. Commitment LineAs of March 31, 2022 and 2021, there were unused commitment line agreements under which the Company
is the lender of ¥13,947 million (US$113 million) and ¥10,240 million, respectively.

18. Subordinated Bonds Payable
As of March 31, 2022 and 2021, bonds payable are subordinated bonds payable, for which the repayments
are subordinated to other obligations.

19. Subordinated Loans Payable
As of March 31, 2022 and 2021, other liabilities included subordinated loans payable of ¥41,000 million(US$334 million) and ¥41,000 million, respectively, for which the repayments are subordinated to otherobligations.

20. Contributions to Policyholders Protection Corporation
The estimated future contributions to the Life Insurance Policyholders Protection Corporation of Japan
under Article 259 of the Insurance Business Act as of March 31, 2022 and 2021 were ¥8,260 million (US$67
million) and ¥8,016 million, respectively. These contributions are charged as operating expenses in thefiscal years in which they are paid.

21. Deferred Taxes(1) Deferred tax assets/liabilities were recognized as follows:
Millions of
U.S. Dollars

Millions of Yen
As of March 31
Deferred tax assets
Valuation allowance for deferred tax assets
Subtotal
Deferred tax liabilities
Net deferred tax assets (liabilities)

2022
¥

¥

70,651
15,33255,31958,064(2,745)2021¥¥

66,824
14,98051,84374,045(22,202)

2022
$

$

577
125
451
474
(22)

53

9. Consolidated Financial Statements

Major components of deferred tax assets/liabilities were as follows:
Millions of Yen
As of March 31
Deferred tax assets
Contingency reserve
Reserve for price fluctuation
Net defined benefit liabilities
Impairment losses
Net unrealized losses on available-for-sale securities
IBNR reserves
Deferred tax liabilities
Net unrealized gains on available-for-sale securities

2022¥

21,797
13,450
9,165
7,223
4,394
3,944
56,417

Millions of Yen
As of March 31
Deferred tax assets
Contingency reserve
Reserve for price fluctuation
Net defined benefit liabilities
Impairment losses
Net unrealized losses on available-for-sale securities
Losses on valuation of securities
Deferred tax liabilities
Net unrealized gains on available-for-sale securities

2021¥

17,422
12,744
9,183
7,930
5,406
4,110
72,520Millions of
U.S. Dollars
As of March 31
Deferred tax assets
Contingency reserve
Reserve for price fluctuation
Net defined benefit liabilities
Impairment losses
Net unrealized losses on available-for-sale securities
IBNR reserves
Deferred tax liabilities
Net unrealized gains on available-for-sale securities

2022
$

178
109
74
59
35
32
460

(2) The statutory tax rates were 27.9% and 27.9% for the fiscal years ended March 31, 2022 and 2021,
respectively. The main factors causing the differences between the statutory tax rates and the actual
effective tax rates after considering deferred taxes were as follows:
For the year ended March 31

Interest on foundation funds
For the year ended March 31
Interest on foundation funds
Change of valuation allowance for deferred tax assets
Reserve for dividends to policyholders

2022(4.4)%
2021(4.3)%(2.9)%(2.0)%

22. Accrued Retirement Benefits and Net Defined Benefit Liabilities(1) Summary of retirement benefit plans
As defined benefit plan, the Company and its consolidated subsidiaries have defined benefit corporate
pension plans, which are funded-type, and lump-sum retirement allowance plans which are non-fundedtype but resulted in funded type due to setting of employee pension trust.

54

Asahi Mutual Life Insurance Company Annual Report 2022

9. Consolidated Financial Statements(2) Defined benefit plani)

Reconciliation of beginning and ending balance of retirement benefit obligations
Millions of
U.S. Dollars

Millions of Yen
For the years ended March 31
Retirement benefit obligations at the beginning of
the fiscal year
Service cost
Interest cost
Actuarial difference occurred during the fiscal year
Retirement benefit payments
Retirement benefit obligations at the end of the
fiscal year

2022

2021

2022

¥

41,202
1,889
407
520
(3,622)¥

42,065
1,905
416
866
(4,051)

$

336
15
3
4
(29)

¥

40,397¥

41,202$

330ii) Reconciliation of beginning and ending balance of pension plan assets
Millions of
U.S. Dollars

Millions of Yen
For the years ended March 31
Pension plan assets at the beginning of the fiscal
year
Expected return on pension plan assets
Actuarial difference occurred during the fiscal year
Contributions by the employer
Retirement benefit payments
Pension plan assets at the end of the fiscal year

2022
¥

¥

8,782
80
(818)
242
(217)
8,069

2021
¥

7,258
70
1,405
239
(191)
8,782

¥

2022
$

71
0
(6)
1
(1)
65

$

iii) Reconciliation of retirement benefit obligation and pension plan assets with net defined benefit
liabilities and assets presented on the consolidated balance sheets
Millions of
U.S. Dollars

Millions of Yen
As of March 31
a. Funded plan retirement benefit obligationb. Pension plan assets
c. Net amount of liabilities and assets presented on
the consolidated balance sheet
d. Net defined benefit liabilities
e. Net defined benefit assets
f. Net amount of liabilities and assets presented on
the consolidated balance sheet

2022¥

40,397(8,069)2021¥

41,202(8,782)32,32732,852(524)¥

32,327

2022
$

330
(65)

32,42032,914(494)¥

32,420

264
268
(4)
$

264

iv) Breakdown of retirement benefit expenses
Millions of
U.S. Dollars

Millions of Yen
For the years ended March 31
Service cost
Interest cost
Expected return on pension plan assets
Amortization of actuarial differences
Retirement benefit expenses related to defined
benefit plan

2022

2021

2022

¥

1,889
407
(80)
329

¥

1,905
416
(70)
111

$

15
3
(0)
2

¥

2,545

¥

2,362

$

20

55

9. Consolidated Financial Statementsv) Breakdown of items included in other comprehensive income
The breakdown of items included in other comprehensive income (before tax effects) was asfollows:
Millions of
U.S. Dollars

Millions of Yen
For the years ended March 31
Amortization of actuarial differences
Total

2022
¥
¥

2021

(1,010)(1,010)

¥
¥

2022
649
649

$
$

(8)
(8)

vi) Breakdown of items included in accumulated other comprehensive income
The breakdown of items included in total accumulated other comprehensive income (before tax
effects) was as follows:
Millions of
U.S. Dollars

Millions of Yen
For the years ended March 31
Unrecognized actuarial differences
Total

2022
¥
¥

2021

2,885
2,885

¥
¥

2022

1,875
1,875

$
$

23
23

vii) Breakdown of main pension plan assets
The breakdown of main asset categories as a percentage of pension plan assets was as follows:
As of March 31
Stocks
Bonds
Others
Total

2022

2021

36%
18%
46%
100%

43%
15%
42%
100%

viii) Method for determining the expected long-term rate of return
To determine the expected long-term rate of return on pension plan assets, the Company takes into
account the present and future allocation of pension plan assets, and the present and expected
future long-term rate of return on the diverse range of assets that makes up the pension assets.
ix) Underlying actuarial assumptions
The main underlying actuarial assumptions were as follows:
As of March 31
Discount rate
Expected long-term rate of return on pension plan
assetsDefined benefit corporate pension plans

2022

2021
1.0%

1.0%

0.8%
1.6%

0.9%
1.6%

23. Subsequent Events
The Company resolved to redeem ¥40,000 million (US$326 million) of foundation funds, which is part of¥80,000 million of foundation funds offered in August 2015, on August 1, 2022, prior to the redemption
date, at the meeting of Board of Directors on May 19, 2022. Accompanying the redemption, the sameamount is scheduled to be transferred from reserve for fund redemption to reserve for redemption offoundation funds in accordance with Article 56 of the Insurance Business Act.

56

Asahi Mutual Life Insurance Company Annual Report 2022

9. Consolidated Financial Statements

III. Notes to Consolidated Statements of Income
1. Investment Income and Expenses
The major components of gains on sales of securities were as follows:
Millions of
U.S. Dollars

Millions of Yen
For the years ended March 31
Domestic bonds
Domestic stocks and other securities
Foreign securities

2022
¥

2021

4,943
6,239
767

¥

2022

9,357
3,332
2,559

$

40
50
6

The major components of losses on sales of securities were as follows:
Millions of
U.S. Dollars

Millions of Yen
For the years ended March 31
Domestic bonds
Domestic stocks and other securities
Foreign securities

2022
¥

2021

1,073
1,448
8,655

¥

2022

892
1,893
2,733

$

8
11
70

The major components of losses on valuation of securities were as follows:
Millions of
U.S. Dollars

Millions of Yen
For the years ended March 31
Domestic stocks and other securities
Foreign securities

2022
¥

2021
272
1

¥

2022
17
1

$

2
0

Losses on trading securities were losses on sales of ¥1,133 million (US$9 million) and losses on sales of ¥485
million for the fiscal years ended March 31, 2022 and 2021, respectively.
Losses on derivative financial instruments included net valuation gains of ¥641 million (US$5 million) andlosses of ¥2,667 million for the fiscal years ended March 31, 2022 and 2021, respectively.

2. Reinsurance Revenue and Reinsurance Premiums
The increased amount of unamortized ceding commissions for reinsurance contracts stipulated in Article
1, Paragraph 5 of the Japanese Ministry of Finance Public Notice No. 50, 1996 for the fiscal year ended
March 31, 2022 was ¥6,989 million (US$57 million), which was included in reinsurance revenue.
The decreased amount of unamortized ceding commissions for reinsurance contracts stipulated in Article
1, Paragraph 5 of the Japanese Ministry of Finance Public Notice No. 50, 1996 for the fiscal year ended
March 31, 2022 was ¥597 million (US$4 million), which was included in reinsurance premiums.

3. Impairment Losses of Fixed Assets
For the fiscal years ended March 31, 2022 and 2021, impairment losses of fixed assets by the Company
were as follows:(1) Method of grouping
The method of grouping is described in “Note 1. (17) Impairment losses of tangible fixed assets” of theconsolidated balance sheets.
Note for the fiscal year ended March 31, 2021
Real estate and other assets used for insurance business operations are classified as one asset groupas a whole. Other assets such as real estate for rent, real estate not in use and real estate scheduled tobe sold are classified as one group individually.

57

9. Consolidated Financial Statements(2) Background information on recognizing the impairment losses
As the profitability of certain real estate for rent dropped down significantly due to a decrease in thelevel of rental income and a declining trend in the market prices of land, the Company reduced thebook values of such real estate for rent, real estate not in use and real estate scheduled to be sold totheir recoverable amounts. The write-downs were recognized as impairment losses and included in theextraordinary losses.
(3) Asset groups for which impairment losses were recognized and losses by classification of fixed assets
Millions of
U.S. Dollars

Millions of Yen
For the years ended March 31
Real estate for rent:
Land
Building
Total real estate for rent (i)Real estate not in use:Land
Building
Total real estate not in use (ii)Real estate scheduled to be sold:Land
Building
Total real estate scheduled to be sold (iii)
Total:Land
Building
Total (i) + (ii) + (iii)

2022
¥

¥

2021
–
–
–

¥

2022
721
156
877

$

–
–
–

622
526
1,149

457
141
598

5
4
9

–
–
–

1,309
185
1,494

–
–
–

622
526
1,149

2,488
483
2,971

5
4
9

¥

$

(4) Calculation method of recoverable amounts
The recoverable amounts of real estate for rent are determined at net realizable value or value in use.
The recoverable amounts for real estate not in use and real estate scheduled to be sold are net realizablevalue. Value in use is determined as the estimated net future cash flows, reflecting the volatility risk,
discounted at 3.3% and 3.4% for the fiscal years ended March 31, 2022 and 2021, respectively. Net
realizable value is calculated based on the appraisal value in accordance with “Real Estate Appraisal
Standards” or the publicly announced appraisal value after deducting expected disposal costs.

4. Extraordinary Losses
Note for the fiscal year ended March 31, 2021
The expenses related to salary guarantees for sales representatives and others as countermeasures toprevent the spread of COVID-19 for the fiscal year ended March 31, 2021 were ¥1,572 million, which were
included in other extraordinary losses.

58

Asahi Mutual Life Insurance Company Annual Report 2022

9. Consolidated Financial Statements

IV. Notes to Consolidated Statements of Comprehensive Income
Other Comprehensive Income
The reclassification adjustments and tax effect amounts related to other comprehensive income were as follows:
Millions of
U.S. Dollars

Millions of Yen
For the years ended March 31
Net unrealized gains on available-for-sale securities, net of tax
Amount incurred during the fiscal year
Reclassification adjustments
Before tax adjustment
Tax effects
Net unrealized gains on available-for-sale securities, netof taxAccumulated remeasurements of defined benefit plans
Amount incurred during the fiscal year
Reclassification adjustments
Before tax adjustment
Tax effects
Accumulated remeasurements of defined benefit plans
Total other comprehensive income

2022
¥

¥

(53,451)(530)(53,982)
14,7192021¥

153,034(2,072)150,961(35,385)

2022
$

(436)
(4)
(441)
120

(39,263)

115,575(320)(1,339)329(1,010)282(728)(39,991)

538
111
649
(184)
465
116,040

(10)
2
(8)
2
(5)
(326)

¥

$

V. Notes to Consolidated Statements of Cash Flows
Scope of Cash and Cash Equivalents
For the purpose of presenting the consolidated statements of cash flows, cash and cash equivalents arecomprised of cash on hand, demand deposits and all highly liquid short-term investments with a maturity of
three months or less when purchased, which are readily convertible into cash and present an insignificant riskof changes in value.

The consolidated financial statements in this annual report have been audited by Ernst & Young ShinNihon LLC, an independentcertified public accountant.

59

10. Non-consolidated Financial Statements
Non-consolidated Balance Sheets
Asahi Mutual Life Insurance Company
Millions of
U.S. Dollars

Millions of Yen
As of March 31
ASSETS:Cash and deposits:
Cash
Deposits

2022¥

Call loans
Monetary claims bought
Securities:
National government bonds
Local government bonds
Corporate bonds
Domestic stocks
Foreign securities
Other securities
Loans:
Policy loans
Industrial and consumer loans
Tangible fixed assets:
Land
Buildings
Lease assets
Construction in progress
Other tangible fixed assets
Intangible fixed assets:
Software
Other intangible fixed assets
Agency accounts receivable
Reinsurance receivables
Other assets:
Accounts receivable
Prepaid expenses
Accrued income
Money on deposit
Derivative financial instruments
Cash collateral paid for financial instruments
Suspense payments
Other assets
Prepaid pension cost
Customers' liabilities under acceptances and guarantees
Allowance for possible loan losses
Total assets

60

Asahi Mutual Life Insurance Company Annual Report 2022¥

20
35,83235,852
111,000
22,5342021¥

15
35,35235,368113,000
25,094

2022

$

0
292
292
906
184

1,669,691
50,540907,641
472,584
1,395,647
69,731
4,565,837

1,692,106
49,130973,538
447,371
1,368,844
81,3304,612,320

13,642
412
7,415
3,861
11,403569
37,30532,199279,217
311,416

35,182
268,268
303,451

263
2,281
2,544

216,027
146,310
2,194
1,175
2,841
368,550

221,081
150,533
1,459
1,589
3,186
377,849

1,765
1,195
17
9
23
3,011

18,928
9,815
28,74311393

17,722
9,075
26,797
14
987

154
80
234
0
3

22,7783,517
20,077
3,044
960
7,513
861
1,300
60,054318–(550)
5,504,161

7,278
4,027
20,230
2,898
1,949
6,202
677
1,427
44,692233
1(406)
5,539,404

186
28
164
24
7
61
7
10
490
2
–
(4)
44,972¥$

10. Non-consolidated Financial Statements

Millions of
U.S. Dollars

Millions of Yen
As of March 31
LIABILITIES:Policy reserves and other reserves:
Reserve for outstanding claims
Policy reserves
Reserve for dividends to policyholders

2022

¥

Reinsurance payables
Bonds payable
Other liabilities:
Payables under securities borrowing transactions
Loans payable
Income taxes payable
Accounts payable
Accrued expenses
Deferred income
Deposits received
Guarantee deposits received
Derivative financial instruments
Cash collateral received for financial instruments
Lease obligations
Asset retirement obligations
Suspense receipts
Reserve for employees' retirement benefits
Reserve for price fluctuation
Deferred tax liabilities
Deferred tax liabilities for land revaluation
Acceptances and guarantees
Total liabilities
NET ASSETS:
Foundation funds
Reserve for redemption of foundation funds
Reserve for revaluation
Surplus:Reserve for future losses
Other surplus:
Reserve for fund redemption
Equalized reserve for dividends to policyholders
Unappropriated surplus (loss)
Subtotal
Total foundation funds and others
Net unrealized gains (losses) on available-for-salesecurities, net of tax
Land revaluation differences
Total valuation and translation adjustments
Total net assets
Total liabilities and net assets

¥

2021

32,0184,365,068
28,644
4,425,731
752
102,424¥2022

28,572
4,419,372
30,0504,477,995
680
127,773$261
35,665234
36,1606
836

179,548
41,0004,474
27,340
7,639
202
415
17,83190,445
3,791
2,194
914
140
375,938
29,847
48,2103,622
15,711–
5,002,238

178,81041,000
5,042
4,422
8,424
186
631
17,53333,471
896
1,459
851
87
292,81730,85645,68022,826
16,2681
5,014,899

1,467
334
36
223
62
1
3
145
738
30
17
7
1
3,071
243
393
29
128
–
40,87191,000166,000
281

91,000166,000
281

743
1,356
2

347

328

2

53,5006,983
56,614
117,097
117,444374,726

44,4007,091
47,55899,05099,378356,660

437
57
462
956
959
3,061

173,936(46,739)
127,197
501,923
5,504,161

213,200(45,354)
167,845524,505
5,539,404

1,421
(381)
1,039
4,101
44,972¥$61

10. Non-consolidated Financial Statements

Non-consolidated Statements of Income
Asahi Mutual Life Insurance Company
Millions of
U.S. Dollars

Millions of Yen
For the years ended March 31
Ordinary income:Premium and other income:Insurance premiums
Reinsurance revenue
Investment income:Interest, dividends and other income:Interest and dividends on securities
Interest on loans
Rent revenue from real estate
Other interest and dividends
Gains on sales of securities
Gains on redemption of securities
Foreign exchange gains
Other investment income
Investment gains on separate accounts
Other ordinary income:Fund receipt from deposit of claims paid
Reversal of reserve for employees' retirement benefits
Reversal of reserve for outstanding claims
Reversal of policy reserves
Other ordinary income
Total ordinary income
Ordinary expenses:
Claims and other payments:
ClaimsAnnuities
Benefits
Surrender benefits
Other payments
Reinsurance premiums
Provision for policy reserves and other reserves:
Provision for reserve for outstanding claims
Provision for interest on policyholders' dividend reserves
Investment expenses:
Interest expenses
Losses on trading securities
Losses on sales of securities
Losses on valuation of securities
Losses on redemption of securities
Losses on derivative financial instruments
Provision for allowance for possible loan losses
Depreciation of rental real estate and other assets
Other investment expenses
Operating expenses
Other ordinary expenses:
Claim deposit payments
Taxes
Depreciation
Other ordinary expenses
Total ordinary expenses
Ordinary profit

62

Asahi Mutual Life Insurance Company Annual Report 2022

2022

¥

385,691
1,443
387,134

2021

¥

2022

388,896
2,514
391,410

$

3,151
11
3,163

99,054
4,241
16,339895
120,531
11,949
317
3,065
6,919
2,199
144,983

95,8494,639
16,543
1,078
118,111
15,249
77
387
6,968
5,740
146,534

809
34
133
7
984
97
2
25
56
17
1,184

8,135
1,008
–
54,3042,343
65,792597,910

8,927
1,677
806
48,624
2,732
62,767600,713

66
8
–
443
19
537
4,885

107,517
116,767
72,93879,2362,403
2,602
381,466

112,015
122,158
68,241
77,5383,158
2,272
385,384

878
954
595
647
19
21
3,116

3,446
3
3,449

–
3
3

28
0
28

4,876
1,133
11,177
273
48
2,510
141
5,511
10,981
36,655
110,388

4,470
485
5,520
19
65
8,898
10
5,503
9,584
34,559110,323

39
9
91
2
0
20
1
45
89
299
901

9,859
9,345
12,354
2,086
33,646565,605
32,305

10,491
9,126
12,181
2,013
33,812564,083
36,629

80
76
100
17
274
4,621
263

10. Non-consolidated Financial Statements

Millions of
U.S. Dollars

Millions of Yen
For the years ended March 31

2022

Extraordinary gains:
Gains on disposal of fixed assets
Other extraordinary gains
Extraordinary losses:
Losses on disposal of fixed assets
Impairment losses
Provision for reserve for price fluctuation
Losses on reduction entry of real estate
Other extraordinary losses
Surplus before income taxes
Income taxes:
Current
Deferred
Total income taxes
Net surplus

¥

2021

2022

2,925
3
2,928

146
129
275

23
0
23

2,751
1,149
2,530
–
130
6,561
28,671

1,481
2,971
2,450
5
1,694
8,602
28,302

22
9
20
–
1
53
234

10,788(5,041)
5,747
22,924

10,122(5,084)
5,038
23,263

88
(41)
46
187

¥

$

63

10. Non-consolidated Financial Statements

Non-consolidated Statements of Changes in Net Assets
Asahi Mutual Life Insurance Company
Millions of Yen
Foundation funds and others
Surplus
For the year ended
March 31, 2022

Beginning balance

Reserve forredemption Reserve
Foundation
Reserve
of
for
funds
foundation revaluation for future
lossesfunds¥ 91,000 ¥ 166,000 ¥Changes in the fiscal year:
Additions to reserve for dividends topolicyholders
Additions to reserve for future losses
Payment of interest on foundation
funds
Net surplus
Additions to reserve for fundredemption
Reversal of equalized reserve fordividends to policyholders
Reversal of land revaluationdifferences
Net changes, excluding foundation
funds and others
Net changes in the fiscal year––
Ending balance¥ 91,000 ¥166,000 ¥

281 ¥

Total
foundation
Equalized
Total
funds andReserve
reserve for Unappropriated surplus
othersfor funddividends to surplus (loss)
redemption
policyholders
Other surplus

328 ¥ 44,400 ¥

7,091 ¥ 47,558 ¥ 99,378 ¥356,660

19

9,100

(2,153)(19)(2,153)(2,153)(4,089)22,924(4,089)22,924(4,089)22,924

1,384

1,384

(9,100)
(108)

108
1,384

–
281 ¥

19
9,100
347 ¥ 53,500 ¥

(108)
9,055
18,066
18,066
6,983 ¥ 56,614 ¥117,444 ¥374,726

Millions of Yen
Valuation and translation adjustments
For the year ended
March 31, 2022

Beginning balance

Net unrealized
gains (losses) on
available-for-salesecurities, net of tax

Land revaluationdifferences

Total valuationand translation
adjustments

Total net assets

¥

¥

¥

¥

213,200(45,354)

167,845

Changes in the fiscal year:
Additions to reserve for dividends topolicyholders
Additions to reserve for future losses
Payment of interest on foundation funds
Net surplus
Additions to reserve for fund redemption
Reversal of equalized reserve for dividends topolicyholders
Reversal of land revaluation differences
Net changes, excluding foundation funds andothersNet changes in the fiscal year
Ending balance

64

Asahi Mutual Life Insurance Company Annual Report 2022

524,505(2,153)(4,089)22,924

1,384¥(39,264)(39,264)
173,936¥(1,384)(1,384)(46,739)¥(40,648)(40,648)
127,197¥(40,648)(22,582)
501,923

10. Non-consolidated Financial Statements

Millions of Yen
Foundation funds and others
Surplus
For the year ended
March 31, 2021

Beginning balance

Reserve forredemption Reserve
Foundation
Reserve
of
for
funds
foundation revaluation for future
lossesfunds¥ 91,000 ¥ 166,000 ¥Changes in the fiscal year:
Additions to reserve for dividends topolicyholders
Additions to reserve for future losses
Payment of interest on foundation
funds
Net surplus
Additions to reserve for fundredemption
Reversal of equalized reserve fordividends to policyholders
Reversal of land revaluationdifferences
Net changes, excluding foundation
funds and others
Net changes in the fiscal year––
Ending balance¥ 91,000 ¥166,000 ¥

281 ¥

Total
foundation
Equalized
Total
funds andReserve
reserve for Unappropriated surplus
othersfor funddividends to surplus (loss)
redemption
policyholders
Other surplus

310 ¥ 35,300 ¥

7,318 ¥ 38,890 ¥ 81,819 ¥339,100

18

9,100

(1,794)(18)(1,794)(1,794)(4,081)
23,263(4,081)
23,263(4,081)
23,263

171

171(9,100)
(227)

227
171

–
281 ¥

18
9,100
328 ¥ 44,400 ¥

(227)
8,668
17,55917,5597,091 ¥ 47,558 ¥ 99,378 ¥356,660

Millions of Yen
Valuation and translation adjustments
For the year ended
March 31, 2021

Beginning balance
Changes in the fiscal year:
Additions to reserve for dividends topolicyholders
Additions to reserve for future losses
Payment of interest on foundation funds
Net surplus
Additions to reserve for fund redemption
Reversal of equalized reserve for dividends topolicyholders
Reversal of land revaluation differences
Net changes, excluding foundation funds andothersNet changes in the fiscal year
Ending balance

Net unrealized
gains (losses) on
available-for-salesecurities, net of tax

Land revaluationdifferences

Total valuationand translation
adjustments

Total net assets

¥

¥

¥

¥

97,625(45,183)

52,442391,543(1,794)(4,081)
23,263

171¥

115,574
115,574
213,200

¥

(171)
(171)
(45,354)¥

115,403
115,403167,845¥

115,403
132,962
524,50565

10. Non-consolidated Financial Statements

Millions of U.S. Dollars
Foundation funds and others
Surplus
For the year ended
March 31, 2022

Beginning balance

Reserve forredemption Reserve
Foundation
Reserve
of
for
funds
foundation revaluation for future
lossesfunds$

Changes in the fiscal year:
Additions to reserve for dividends topolicyholders
Additions to reserve for future losses
Payment of interest on foundation
funds
Net surplus
Additions to reserve for fundredemption
Reversal of equalized reserve fordividends to policyholders
Reversal of land revaluationdifferences
Net changes, excluding foundation
funds and others
Net changes in the fiscal year
Ending balance
$

743 $

1,356 $

2$

Total
foundation
Equalized
Total
funds andReserve
reserve for Unappropriated surplus
othersfor funddividends to surplus (loss)
redemption
policyholders

2 $Other surplus

362 $

57 $

0

74

388 $

811 $

(17)
(0)

(17)

(17)

(33)
187

(33)
187

(33)
187

11

11

11

73
462 $

147
959 $

(74)
(0)

–
743 $

–
1,356 $

–
2$

0
2 $

2,914

74
437 $

(0)
57 $

0

147
3,061

Millions of U.S. Dollars
Valuation and translation adjustments
For the year ended
March 31, 2022

Beginning balance
Changes in the fiscal year:
Additions to reserve for dividends topolicyholders
Additions to reserve for future losses
Payment of interest on foundation funds
Net surplus
Additions to reserve for fund redemption
Reversal of equalized reserve for dividends topolicyholders
Reversal of land revaluation differences
Net changes, excluding foundation funds andothersNet changes in the fiscal year
Ending balance

66

Asahi Mutual Life Insurance Company Annual Report 2022

Net unrealized
gains (losses) on
available-for-salesecurities, net of tax

Land revaluationdifferences

Total valuationand translation
adjustments

Total net assets

$

$

$

$

1,741

(370)

1,371

4,285

(17)
(33)
187

11

$

(320)
(320)
1,421

$

(11)
(11)
(381)

$

(332)
(332)
1,039

$

(332)
(184)
4,101

10. Non-consolidated Financial Statements

Non-consolidated Statements of Proposed Appropriation of Surplus(Loss)
Asahi Mutual Life Insurance Company
Millions of
U.S. Dollars

Millions of Yen
For the years ended March 31
Unappropriated surplus (loss)
Reversal of Voluntary surplus reserves:
Reversal of equalized reserve for dividends to policyholders
Total
Appropriation of surplus (loss):Reserve for dividends to policyholders
Net surplus (loss):Reserve for future losses
Interest on foundation funds
Voluntary surplus reserves:
Reserve for fund redemption
Equalized reserve for dividends to policyholders
Surplus (loss) carried forward

2022
¥

¥

56,614––56,614
15,3902,121
13,269
19
4,040
9,210
9,100
110
41,2232021¥¥

47,558108
108
47,667
15,361
2,153
13,208
19
4,089
9,100
9,100
–
32,305

2022
$

$

462
–
–
462
125
17
108
0
33
75
74
0
336

67

10. Non-consolidated Financial Statements

Notes to Non-consolidated Financial Statements
Asahi Mutual Life Insurance Company

I. Presentation of Non-consolidated Financial Statements
1. Basis of Presentation
The accompanying non-consolidated financial statements have been prepared from the accounts
maintained by Asahi Mutual Life Insurance Company (the “Company”) in accordance with the provisions
set forth in the Insurance Business Act of Japan and its related rules and regulations applicable to themutual life insurance industry and in conformity with accounting principles generally accepted in Japan,
which are different in certain respects from accounting principles generally accepted in countries andjurisdictions other than Japan.
In addition, the notes to the non-consolidated financial statements include information which is not
required under accounting principles generally accepted in Japan but is presented herein as additional
information.
Amounts of less than one million yen have been eliminated. As a result, total amounts in yen shown herein
do not necessarily agree with the sum of the individual amounts.
The Insurance Business Act shall prescribe the disclosure of a single fiscal year. The Company provides
the disclosure of comparative financial information corresponding to each comparative fiscal year in thepresented financial statements for use by readers outside Japan.
In preparing the accompanying non-consolidated financial statements, certain reclassifications have been
made to the non-consolidated financial statements issued domestically in order to present them in aformat which is more familiar to readers outside Japan.

2. U.S. Dollar Amounts
The translations of yen amounts into U.S. dollar amounts are included solely for the convenience of thereader and have been made, as a matter of arithmetical computation only, at the rate of ¥122.39 = US$1.00,
the effective rate of exchange at the balance sheet date of March 31, 2022.
The translations should not be construed as representations that such yen amounts have been or could in
the future be, converted into U.S. dollars at that or any other rate.

II. Notes to Non-consolidated Balance Sheets
1. Significant Accounting Policies(1) Valuation methods of securities
The valuation of securities, including deposits and monetary claims bought which are equivalent tosecurities is as follows:i)

Trading securities are stated at fair market value. Costs of sales are determined by the moving
average method.

ii) Held-to-maturity debt securities are stated at amortized cost (straight-line method) determined by
the moving average method.
iii) Policy-reserve-matching bonds, which are in accordance with “Temporary Treatment of Accounting
and Auditing Concerning Policy-reserve-matching Bonds in Insurance Industry” (Industry Audit
Committee Report No. 21 issued by the Japanese Institute of Certified Public Accountants(“JICPA”)), are stated at amortized cost (straight-line method) determined by the moving averagemethod.
iv) Investments in subsidiaries and affiliates are stated at cost.
v) Available-for-sale securities except for the following are stated at fair market value based on themarket prices at the balance sheet date, of which costs of sales are determined by the moving

68

Asahi Mutual Life Insurance Company Annual Report 2022

10. Non-consolidated Financial Statements

average method. Available-for-sale securities, of which public and corporate bonds including foreign
bonds with the difference between acquisition cost and face value considered as an adjustment
of interest, are stated at amortized cost (straight-line method) determined by the moving averagemethod. Stocks and others without a market price are stated at cost determined by the moving
average method. Net unrealized gains or losses on these available-for-sale securities, net of tax,
are recorded as a separate component of net assets.
Note for the fiscal year ended March 31, 2021
Available-for-sale securities with fair market value except for the following are stated at fair market
value based on the market prices at the end of the fiscal year. Available-for-sale securities with fairmarket value, of which domestic stocks, domestic stock exchange-traded funds, domestic listed
real estate investment trusts, foreign stock exchange-traded funds for which hedge accounting
is not applied, foreign bond exchange-traded funds for which hedge accounting is not appliedand foreign currency-denominated bonds for which hedge accounting is not applied, are stated
at fair market value based on the average of the market prices during the final month of the fiscal
year. Costs of sales are determined by the moving average method. Available-for-sale securities
with extreme difficulty of measuring fair market value, of which public and corporate bonds
including foreign bonds with the difference between acquisition cost and face value considered
as an adjustment of interest, are stated at amortized cost (straight-line method) determined by
the moving average method. The other securities are stated at cost determined by the moving
average method. Net unrealized gains or losses on these available-for-sale securities, net of tax,
are recorded as a separate component of net assets.
(2) Policy-reserve-matching bonds
The Company classifies bonds held with the aim of matching the duration to outstanding insurance
liabilities within the sub-groups (categorized by insurance type, investment policy and other factors)of individual life insurance and individual annuities as policy-reserve-matching bonds in accordancewith “Temporary Treatment of Accounting and Auditing Concerning Policy-reserve-matching Bonds inInsurance Industry” (Industry Audit Committee Report No. 21 issued by the JICPA).
Since the fiscal year ended March 31, 2022, the Company changed its liability cash flow, which is thepremise of assessing the duration to outstanding insurance liabilities, from a “Term of future 30 years”
to a “Whole period” for the sub-group including Individual life Insurance and Individual Annuities(excluding Whole Life Insurance with variable interest rate accumulation, Accumulation Insurance withvariable interest rates and New Single Premium Individual Annuity effective on and after April 2, 2012).
This change did not have any effects on the non-consolidated balance sheet and non-consolidated
statement of income as of and for the fiscal year ended March 31, 2022.
(3) Valuation methods of derivative financial instruments
Derivative financial instruments are stated at fair market value.
(4) Revaluation of land
The Company revalued the land for business purposes based on the Act on Revaluation of Land (ActNo. 34 promulgated on March 31, 1998). The difference between fair value and book value resulting
from the revaluation, net of related taxes, is recorded as land revaluation differences as a separate
component of net assets and the related tax is recorded as deferred tax liabilities for revaluation.
■ Date of revaluation: March 31, 2001
■ Method of revaluation as prescribed for in Article 3, Paragraph 3 of the said Act:The calculation is based on the publicly announced appraisal value with certain adjustments set forthin Article 2, Item 1 of the Enforcement Ordinance of the Act on Revaluation of Land (Government
Ordinance No. 119 promulgated on March 31, 1998) or the appraisal value determined by thereal-estate appraiser set forth in Article 2, Item 5 of the said Ordinance with certain reasonableadjustments.
(5) Depreciation of tangible fixed assets
Depreciation of the Companyʼs tangible fixed assets is calculated by the following methods.

6910. Non-consolidated Financial Statements■ Tangible fixed assets (excluding lease assets): Declining-balance method
However, buildings are depreciated using the straight-line method.
■ Lease assets related to finance lease transactions that do not transfer ownership: Straight-line
method over the lease term with no residual value(6) Foreign currency translation
Foreign currency-denominated assets and liabilities are translated into Japanese yen at the effective
exchange rate prevailing at the balance sheet date.
Note for the fiscal year ended March 31, 2021
Foreign currency-denominated assets and liabilities are translated into Japanese yen at the effective
exchange rate prevailing at the balance sheet date, except for foreign stock exchange-traded funds
for which hedge accounting is not applied, foreign bond exchange-traded funds for which hedge
accounting is not applied and foreign currency-denominated bonds for which hedge accounting is notapplied categorized as available-for-sale securities with fair market value. Such securities are translated
into Japanese yen at the average of the effective exchange rate during the final month of the fiscal
year.
(7) Allowance for possible loan losses
Allowance for possible loan losses is provided in accordance with the Companyʼs standards of selfassessment and write-offs and reserves on credit quality:i)

For credit to borrowers who are legally bankrupt such as being in bankruptcy proceedings orcivil rehabilitation (hereinafter “legally bankrupt borrowers”) and who are substantially bankrupt(hereinafter “substantially bankrupt borrowers”), the Company provides the remaining amount ofcredits after the direct write-off described below and the deductions of the amount expected tobe collected through the disposal of collateral or the execution of guarantees.

ii) For credit to borrowers who are not currently bankrupt but have a high risk of bankruptcy(hereinafter “borrowers with high possibility of bankruptcy”), the Company provides the amounts
deemed as necessary considering the borrowersʼ ability to pay, within the amounts after
deductions of the amount expected to be collected through the disposal of collateral or the
execution of guarantees.
iii) For credit to borrowers other than the above, the Company provides the amounts calculated bymultiplying the book value by the actual ratio of bad debt losses on defaults during a certain past
period.
All credit is assessed by the relevant departments in accordance with the Companyʼs standards ofself-assessment on credit quality. The results of the assessment are reviewed by the audit department,
which is independent of business-related divisions. Subsequently, allowance for possible loan losses isprovided based on the results of these assessments.
For credit to legally bankrupt borrowers and substantially bankrupt borrowers, the amounts remaining
after deductions of collateral value or the amounts collectible through the execution of guarantees are
written-off directly from the book value as the estimated uncollectible amounts. The amounts writtenoff as of March 31, 2022 and 2021 were ¥24 million (US$0 million) and ¥28 million, respectively.
(8) Accounting for employeesʼ retirement benefits and method of amortizing retirement benefit expenses
Reserve for employeesʼ retirement benefits and prepaid pension cost are presented for the employeesʼ
retirement benefits based on projected benefit obligation and pension plan assets at the balance
sheet date.
The Company uses the following methods of accounting in relation to retirement benefits.
■ The retirement benefit obligation is attributed to each period by the benefit formula method.
■ Actuarial differences are amortized under the straight-line method over a period of seven years
starting the following year.
■ Prior service cost is charged to income when incurred.

70

Asahi Mutual Life Insurance Company Annual Report 2022

10. Non-consolidated Financial Statements(9) Reserve for price fluctuation
Reserve for price fluctuation is calculated in accordance with Article 115 of the Insurance Business Act.
(10) Accounting for hedging activities
Hedging activities are accounted for in accordance with the “Accounting Standards for Financial
Instruments” (Accounting Standards Board of Japan (“ASBJ”) Statement No. 10).
The Company mainly applies the following hedging activities:
The Company applies deferred hedge accounting and the exceptional accounting treatment (“Tokureishori”) for interest rate swaps used to hedge the cash flow volatility of certain loans.
The Company also applies fair value hedge accounting for hedging activities related to foreignexchange rate fluctuation exposures on certain bonds, investment trusts and others denominated inforeign currencies.
The Company also applies designated hedge accounting (“Furiate-shori”) for currency swaps used
to hedge foreign exchange rate fluctuation exposures on the foreign currency-denominated bonds
issued by the Company.
The Company also applies designated hedge accounting (“Furiate-shori”) for the foreign currencydenominated transactions other than the above.
The effectiveness of a hedge is mostly assessed by a ratio analysis, comparing the fluctuations in thefair value or cash flows of hedged items and hedging instruments.
(11) Accounting for consumption taxes
The Company accounts for consumption tax and local consumption tax by the tax-exclusion method.
The consumption taxes on certain assets, which are not deductible from consumption taxes withheld
and that are stipulated to be deferred under the Corporation Tax Act of Japan, are deferred as prepaid
expenses and amortized equally over five years.
Consumption taxes other than deferred consumption taxes are recognized as an expense whenincurred.
(12) Premium and other income (excluding reinsurance revenue)
Premium and other income (excluding reinsurance revenue) are recorded in principle for insurance
policies for which insurance premium has been received and the insurerʼs liability under the insurance
policies or insurance coverage period has commenced by the relevant amounts received.
Of insurance premiums, the portion corresponding to the period that has yet to pass as of the end of
the fiscal year is set aside as policy reserves in accordance with Article 116 of the Insurance BusinessAct and Article 69, Paragraph 1, Item 2 of the Enforcement Regulation of the Insurance Business Act.
(13) Claims and other payments (excluding reinsurance premiums)
Claims and other payments (excluding reinsurance premiums) are recorded for insurance policies forwhich amounts calculated under policy conditions have been paid in the occurrence of insured events
under the policy conditions by the relevant amounts paid.
In accordance with Article 117 of the Insurance Business Act and Article 72 of the Enforcement
Regulation of the Insurance Business Act, reserve for outstanding claims is set aside for claims, etc.
which is not recorded as payment of claims, etc. but for which the Company has payment obligationor the occurrence of insured events has not been reported but the Company finds that insured events
have already occurred, as of the end of the fiscal year.
(14) Policy reserves
Policy reserves are calculated as stated in accordance with the methods stated in the statement ofcalculation procedures for insurance premiums and policy reserves (Article 4, Paragraph 2, Item 4 of
the Insurance Business Act) pursuant to Article 116, Paragraph 1 of the Insurance Business Act, forinsurance policies under which the insurerʼs liability has started as of the end of the fiscal year, in
preparation for the performance of future obligations under the insurance policies.

7110. Non-consolidated Financial Statements

Of policy reserves, the premium reserves at the end of the fiscal year are calculated by the following
method:In regard to the policies subject to the standard policy reserves, the method as prescribed by theCommissioner of Financial Services Agency (Japanese Ministry of Finance Public Notice No. 48, 1996)
is applied.
In regard to the policies not subject to the standard policy reserves, the net level premium method isapplied.
Regarding policy reserves, the chief actuary checks that policy reserves are appropriately accumulated
in each fiscal year, pursuant to Article 121, Paragraph 1 of the Insurance Business Act and Article 80 of
the Enforcement Regulation of the Insurance Business Act.
Contingency reserves included in policy reserves are set aside in accordance with Article 116 of the
Insurance Business Act and Article 69, Paragraph 1, Item 3 of the Enforcement Regulation of the
Insurance Business Act to cover risks that may accrue in the future in order to ensure the performanceof future obligations under insurance policies.
(15) Impairment losses of tangible fixed assets
Impairment losses of the Companyʼs tangible fixed assets are calculated by the following method.
i)

Calculation method
Real estate and other assets used for insurance business operations are classified as one asset
group as a whole. Other assets such as real estate for rent, real estate not in use and real estatescheduled to be sold are classified as one group individually. As for real estate used for multiple
purposes, the asset group to which the real estate belongs is decided depending on usage rate
and others.
The Company identifies indications of impairment on each asset group when earnings frombusiness operations using the asset group continuously become negative.
As for asset groups for which indications of impairment are identified, when total amounts
of undiscounted net future cash flows from the asset groups are less than their book values,
the Company recognizes impairment losses and reduces the book values to their recoverable
amounts.
The recoverable amounts of real estate and other assets for insurance business operation andreal estate for rent are determined at value in use or net realizable value. The recoverable
amounts of real estate not in use and real estate scheduled to be sold are determined at net
realizable value. Value in use is determined as the discounted present value of estimated net
future cash flows and discount rate used in the calculation is based on the cost of capital of theCompany.
Net realizable value is calculated based on the appraisal value in accordance with “Real EstateAppraisal Standards” or the publicly announced appraisal value after deducting expected disposal
costs.

ii) Key assumptions
Key assumptions for the estimated net future cash flows which are used in recognizing impairment
losses and calculating value in use are usage plans considering current status of use of asset
groups, including tenancy rates, rents and others. These assumptions may be affected by economic
condition and changes specific to asset groups.
iii) Effects on non-consolidated financial statements for the following fiscal year
While the Company considers key assumptions for the estimated net future cash flows which areused in recognizing impairment losses and calculating value in use are best estimate based on
available information including external information, impairment losses may occur in the following
fiscal year due to future uncertainties.
Furthermore, the appraisal value in accordance with “Real Estate Appraisal Standards” may beaffected by future real estate market trends. In case that net realizable value decreases as a result,
impairment losses may occur in the following fiscal year.

72

Asahi Mutual Life Insurance Company Annual Report 2022

10. Non-consolidated Financial Statements(16) Software
Capitalized software for internal use owned by the Company is amortized using the straight-line
method over the estimated useful lives.

2. Accounting Changes
The Company has applied “Accounting Standard for Fair Value Measurement” (ASBJ Statement No. 30,
issued on July 4, 2019) and others from the fiscal year ended March 31, 2022. In accordance with thetransitional treatment set forth in Paragraph 19 of "Accounting Standard for Fair Value Measurement"
and Paragraph 44-2 of "Accounting Standard for Financial Instruments" (ASBJ Statement No.10, July4, 2019), the Company has applied new accounting policies prospectively. As a result, available-for-salesecurities, of which domestic listed stocks, domestic stock exchange-traded funds, domestic listed realestate investment trusts, foreign stock exchange-traded funds for which hedge accounting is not applied,foreign bond exchange-traded funds for which hedge accounting is not applied and foreign currencydenominated bonds for which hedge accounting is not applied, are changed to be stated at fair value
based on the market prices at the balance sheet date from fair value based on the average of the market
prices during the final month of the fiscal year.
In determining to recognize impairment losses on available-for-sale securities, the Company has used fairvalue based on the average of market prices during the final month of fiscal year as before.

3. Accounting Standards Issued but Not Yet Effective
The Company and part of its subsidiaries made a request for approval for the application of the group tax
sharing system in December 2021 and it is decided to be applied from the fiscal year ending March 31,
2023.
The accounting standard and relevant implementation guidance issued by the fiscal year-end but not yet
effective is the “Practical Solution on the Accounting and Disclosure Under the Group Tax Sharing System”(ASBJ PITF No.42, issued on August 12, 2021) and its contents are as follows:i)

Overview
The practical solution was issued to stipulate the accounting and disclosure treatment of corporatetax, local corporate tax and tax effect accounting when applying the group tax sharing system,
following the “Act for Partial Amendment of the Income Tax Act, etc.” (Act No.8, 2020) enacted on
March 27, 2020 which requires revision of the consolidated taxation system and transition to thegroup tax sharing system.

ii) Schedule date of application
The practical solution is scheduled to be applied from the beginning of the fiscal year ending
March 31, 2023.
iii) Effects of application of the practical solution
The effects of the application are under assessment at the time of preparing these non-consolidated
financial statements.
Note for the fiscal year ended March 31, 2021
The accounting standards and relevant implementation guidance issued by the fiscal year-end but not yet
effective are as follows:■ “Accounting Standard for Fair Value Measurement” (ASBJ Statement No. 30, issued on July 4, 2019)■ “Implementation Guidance on Accounting Standard for Fair Value Measurement” (ASBJ Guidance
No. 31, issued on July 4, 2019)■ “Accounting Standard for Financial Instruments” (ASBJ Statement No. 10, revised on July 4, 2019)i)

Overview
In these accounting standards and relevant implementation guidance, the guidance on themethods for measuring fair values of financial instruments are set to enhance comparability
between Japanese accounting standards and international accounting standards.

7310. Non-consolidated Financial Statementsii) Schedule date of application
The above revisions are scheduled to be applied from the beginning of the fiscal year ending
March 31, 2022.
iii) Effects of application of the Accounting Standards and relevant implementation guidance
The effects of the application are under assessment at the time of preparing these non-consolidated
financial statements.

4. Changes in Reporting Method
Following the revision of the Enforcement Regulation of the Insurance Business Act, claims to be disclosed
are classified in the revised categories in the following “Note 9. Claims”.

5. Financial Instruments
Asset management of the general accounts other than the separate accounts stipulated in Article 118,
Paragraph 1 of the Insurance Business Act is conducted based on the following principles.
■ For accumulation whole life with variable interest rates, accumulation insurance with variableinterest rates and new single premium individual annuities which have an effective date on or after
April 2, 2012, the Company mainly invests in domestic bonds, engaging in matching asset liability
management, or Matching ALM, which aims at matching the duration to outstanding insurance
liabilities to avoid interest rate fluctuation risks.
■ For individual life insurance and individual annuities other than above, the Company holds yendenominated fixed income investments, including bonds and loans, as the core of its asset portfolio.
The Company also holds domestic stocks, foreign securities and real estate assets to enhance its
profitability.
Derivatives are mainly used to hedge market price fluctuation risk and exchange rate fluctuation risk
regarding securities and exchange rate fluctuation risk related to the foreign currency-denominated bonds
issued by the Company. As the major financial instruments, securities are exposed to market risk and credit
risk, loans are exposed to credit risk and exchange rate fluctuation risk, and derivatives are exposed tomarket risk and credit risk.
In managing market risks, the following two methods are used. One is the quantitative risk managementof securities etc. using the Value at Risk (“VaR”) method and the other is the risk management by stress test
and sensitivity analysis which analyze the effect on the Companyʼs whole portfolio, simulating scenarios ofdeteriorating market environments. This is for the purpose of managing an appropriate asset allocation
within the ranges of acceptable risks.
In managing credit risks, the Company quantifies the credit risks of entire portfolio through VaR method
and controls the amount of risks within an acceptable range. Furthermore, the Company assigns in-housecredit ratings to our borrowers in accordance with the creditworthiness of each borrower. Strict credit
research of each borrower before lending as well as following up on any changes of creditworthiness ofeach borrower after lending are implemented by Risk Management Department, which is independent of
the departments executing investments and lending. Maximum limits of credit are set up for each borrowerin accordance with its credit risks to avoid the concentration of credit risks on specific corporations andspecific corporation groups. Through all these measures, the Company endeavors to develop high quality
portfolio.
The balance sheet amounts, fair values and the differences between those of major financial assets andliabilities as of March 31, 2022 were as follows. The following table does not include cash and deposits, callloans and payables under securities borrowing transactions which are mostly settled in a short term andtheir fair values approximate their book values.

74

Asahi Mutual Life Insurance Company Annual Report 2022

10. Non-consolidated Financial Statements

Millions of Yen
2022
As of March 31
Monetary claims bought
Held-to-maturity debt securities
Available-for-sale securities
Securities
Trading securities
Held-to-maturity debt securities
Policy-reserve-matching bonds
Available-for-sale securities
Loans
Policy loans
Industrial and consumer loans
Total assets
Bonds payable
Loans payable
Total liabilities
Derivative financial instruments
Hedge accounting not applied
Hedge accounting applied

Balance Sheet
Amount¥Fair Value

22,534
21,577957
4,470,179
26,601
280,0702,028,714
2,134,792
311,416
32,199279,217
4,804,130
102,424
41,000143,424(89,485)(2,555)(86,930)¥

24,25523,297957
4,630,876
26,601
310,342
2,159,139
2,134,792
317,500
32,199285,301
4,972,631
103,200
42,260145,460(89,485)(2,555)(86,930)

Difference
¥

1,720
1,720
–
160,696–
30,272
130,424
–
6,083
–
6,083
168,501
776
1,260
2,036
–
–
–

* Assets and liabilities generated by derivative financial instruments are offset and presented net. Net liabilities in total are presented
in parentheses.

Millions of U.S. Dollars
2022
As of March 31
Monetary claims bought
Held-to-maturity debt securities
Available-for-sale securities
Securities
Trading securities
Held-to-maturity debt securities
Policy-reserve-matching bonds
Available-for-sale securities
Loans
Policy loans
Industrial and consumer loans
Total assets
Bonds payable
Loans payable
Total liabilities
Derivative financial instruments
Hedge accounting not applied
Hedge accounting applied

Balance Sheet
Amount$184
176
7
36,524217
2,288
16,575
17,442
2,544
263
2,281
39,252
836
334
1,171
(731)
(20)
(710)

Fair Value
$

198
190
7
37,837217
2,535
17,641
17,442
2,594
263
2,331
40,629
843
345
1,188
(731)
(20)
(710)

Difference
$

14
14
–
1,312
–
247
1,065
–
49
–
49
1,376
6
10
16
–
–
–

* Assets and liabilities generated by derivative financial instruments are offset and presented net. Net liabilities in total are presented
in parentheses.

Unlisted stocks and others, including investments in subsidiaries and affiliates, without market prices are
not included in the table above. The amount of the unlisted stocks and others, including investments in
subsidiaries and affiliates, reported in the non-consolidated balance sheet was ¥51,645 million (US$421
million) as of March 31, 2022.
Investments in partnerships and others for which transitional measures are applied in accordance with
Paragraph 27 of “Implementation Guidance on Accounting Standard for Fair Value Measurement” (ASBJ
Guidance No. 31, issued on July 4, 2019) are not included in the table above. The amount of the investmentsin partnerships and others, reported in the non-consolidated balance sheet was ¥44,012 million (US$359
million) as of March 31, 2022.

75

10. Non-consolidated Financial Statements

Notes for the fiscal year ended March 31, 2021
The balance sheet amounts, fair values and the differences between those of major financial assets andliabilities as of March 31, 2021 were as follows:
Millions of Yen
2021
As of March 31
Cash and deposits
Call loans
Monetary claims bought
Trading securities
Held-to-maturity debt securities
Policy-reserve-matching bonds
Available-for-sale securities
Securities
Trading securities
Held-to-maturity debt securities
Policy-reserve-matching bonds
Available-for-sale securities
Loans
Policy loans
Industrial and consumer loans
Total assets
Bonds payable
Payables under securities borrowing transactions
Loans payable
Total liabilities
Derivative financial instruments
Hedge accounting not applied
Hedge accounting applied

Balance Sheet
Amount¥35,368113,000
25,094–
24,125–969
4,577,667
26,307
296,880
2,039,060
2,215,419
303,451
35,182
268,268
5,054,581
127,773
178,81041,000347,584(31,522)(1,875)(29,646)

Fair Value¥

35,368113,000
27,415–26,446–969
4,830,674
26,307
333,953
2,254,994
2,215,419
311,163
35,182275,980
5,317,621
130,313
178,81042,548351,673(31,522)(1,875)(29,646)

Difference
¥

–
–
2,321
–
2,321
–
–
253,006–
37,073215,933
–
7,712
–
7,712
263,040
2,540
–
1,548
4,088
–
–
–

* Assets and liabilities generated by derivative financial instruments are offset and presented net. Net liabilities in total are presented
in parentheses.

(1) Securities including deposits and monetary claims bought which are treated as securities based on“Accounting Standards for Financial Instruments” (ASBJ Statement No. 10)
As for available-for-sale securities of which market value is readily available, domestic stocks, domestic
stock exchange-traded funds, domestic listed real estate investment trusts, foreign stock exchangetraded funds for which hedge accounting is not applied, foreign bond exchange-traded funds forwhich hedge accounting is not applied and foreign currency-denominated bonds for which hedge
accounting is not applied are stated at the average of the market value during the final month of
the fiscal year. Available-for-sale securities of which market value is readily available excluding thesecurities mentioned above are stated at the market value at the balance sheet date.
Other securities of which market value is readily available are stated at market value at the balance
sheet date.
Unlisted stocks and others, including investments in subsidiaries and affiliates, of which market value is
not readily available are not subject to fair value disclosure and are therefore not included in the table
above because it is regarded as extremely difficult to determine their fair value.
The amount of the unlisted stocks and others, including investments in subsidiaries and affiliates,
reported in the non-consolidated balance sheet was ¥34,653 million as of March 31, 2021.

76

Asahi Mutual Life Insurance Company Annual Report 2022

10. Non-consolidated Financial Statements(2) Loans and loans payableAs credit exposure for policy loans without specific repayment periods is limited to the amount of the
cash surrender value, the Company considers book value as fair value with the assumption that fair value
approximates book value in light of factors such as projected repayment period and interest terms.
As for industrial and consumer loans and loans payable, the fair value of loans is primarily statedat theoretical prices calculated by discounting the future cash flows to the present value. The fairvalue of loans to legally bankrupt borrowers, substantially bankrupt borrowers and borrowers with highpossibility of bankruptcy is stated at the amounts by deducting estimated losses from the book value
before direct write-offs.
(3) Bonds payable
The fair value of bonds payable is based on the market value, etc. as of March 31, 2021.
(4) Payables under securities borrowing transactions
The Company considers book value as fair value with the assumption that fair value approximatesbook value.
(5) Derivative financial instruments
The fair values of stock options and currency options traded over the counter are based on the quoted
prices offered by counterparty financial institutions.
The fair values of foreign currency forward contracts are stated at theoretical prices based on the TTM
at the balance sheet date.
Regarding the derivative transactions for which designated hedge accounting (“Furiate-shori”) ofcurrency swaps is applied, these fair values are included in bonds payable since they are treated
together with hedged bonds payable.

6. Matters concerning fair value of major financial instruments and breakdown by input level
Fair values of financial instruments are categorized into the following three levels in accordance with theobservability and significance of the inputs used to measure the fair value.
Level 1: Fair values measured by unadjusted quoted prices in active markets for identical assets or liabilities
Level 2: Fair values measured by inputs which are directly or indirectly observable other than Level 1 inputs
Level 3: Fair values measured by significant unobservable inputs
When several inputs that have significant impact on fair value measurement are used and those inputs
are categorized into different levels, the fair value is categorized into the lowest priority level for fair value
measurement among the levels to which each of the inputs belongs.

7710. Non-consolidated Financial Statements(1) Financial assets and liabilities recorded at fair values on the non-consolidated balance sheet
Millions of Yen
2022
As of March 31

Fair Value
Level 1

Monetary claims bought
Available-for-sale securities
Securities*1
Trading securities
National government bonds and local
government bonds
Corporate bonds
Domestic stocks
Foreign stocks
Foreign bonds
Available-for-sale securities
National government bonds and local
government bonds
Corporate bonds
Domestic stocks
Foreign bonds
Total assets
Derivative financial instruments*2
Currency-related
Stock-related¥––
580,435
24,719Level 2¥––
1,169,127
1,882¥

Level 3957
957
29,482
–

Total
¥

957
957
1,779,045
26,601

5,830
–
7,914
8,269
2,705
555,716

–
902
–
–
979
1,167,245

–
–
–
–
–
29,482

5,830
902
7,914
8,269
3,684
1,752,444

39,829–413,036
102,850
580,435–––

685
426,840–
739,719
1,169,127(89,755)(89,755)––––
29,48230,440270–
270

40,514
426,840
413,036
872,053
1,780,003(89,485)(89,755)
270*1 Investment trusts for which transitional measures are applied in accordance with Paragraph 26 of “Implementation Guidance on
Accounting Standard for Fair Value Measurement” (ASBJ Guidance No. 31, issued on July 4, 2019) are not included in the table
above. The balance sheet amount of the investment trusts was ¥382,348 million (US$3,124 million) as of March 31, 2022.
*2 Assets and liabilities generated by derivative financial instruments are offset and presented net. Net liabilities in total arepresented in parentheses.

Millions of U.S. Dollars
2022
As of March 31

Fair Value
Level 1

Monetary claims bought
Available-for-sale securities
Securities*1
Trading securities
National government bonds and local
government bonds
Corporate bonds
Domestic stocks
Foreign stocks
Foreign bonds
Available-for-sale securities
National government bonds and local
government bonds
Corporate bonds
Domestic stocks
Foreign bonds
Total assets
Derivative financial instruments*2
Currency-related
Stock-related

$

–
–
4,742
201

Level 2
$

–
–
9,552
15

Level 3
$

7
7
240
–

Total
$

7
7
14,535
217

47
–
64
67
22
4,540

–
7
–
–
8
9,537

–
–
–
–
–
240

47
7
64
67
30
14,318

325
–
3,374
840
4,742
–
–
–

5
3,487
–
6,043
9,552
(733)
(733)
–

–
–
–
240
248
2
–
2

331
3,487
3,374
7,125
14,543
(731)
(733)
2

*1 Investment trusts for which transitional measures are applied in accordance with Paragraph 26 of “Implementation Guidance on
Accounting Standard for Fair Value Measurement” (ASBJ Guidance No. 31, issued on July 4, 2019) are not included in the table
above. The balance sheet amount of the investment trusts was ¥382,348 million (US$3,124 million) as of March 31, 2022.
*2 Assets and liabilities generated by derivative financial instruments are offset and presented net. Net liabilities in total arepresented in parentheses.

78

Asahi Mutual Life Insurance Company Annual Report 2022

10. Non-consolidated Financial Statements(2) Financial assets and liabilities not recorded at fair values on the non-consolidated balance sheet
Millions of Yen
2022
As of March 31

Fair Value
Level 1

Monetary claims bought
Held-to-maturity debt securities
Securities
Held-to-maturity debt securities
National government bonds and local
government bonds
Corporate bonds
Foreign bonds
Policy-reserve-matching bonds
National government bonds and local
government bonds
Corporate bonds
Loans
Policy loans
Industrial and consumer loans
Total assets
Bonds payable
Loans payable
Total liabilities¥––
1,752,190
36,939Level 2¥––592,381
148,494¥

Level 323,29723,297
124,909
124,909¥

Total
23,29723,2972,469,481
310,342

36,939––1,715,251–
92,90055,594
443,887––
124,909–36,93992,900180,503
2,159,139

1,715,251––––
1,752,190–––

51,082392,804–––
592,381
103,200–
103,200––
317,500
32,199285,301
465,707–42,26042,2601,766,334
392,804
317,500
32,199285,3012,810,279
103,200
42,260145,460

Millions of U.S. Dollars
2022
As of March 31

Fair Value
Level 1

Monetary claims bought
Held-to-maturity debt securities
Securities
Held-to-maturity debt securities
National government bonds and local
government bonds
Corporate bonds
Foreign bonds
Policy-reserve-matching bonds
National government bonds and local
government bonds
Corporate bonds
Loans
Policy loans
Industrial and consumer loans
Total assets
Bonds payable
Loans payable
Total liabilities$––
14,316301

Level 2
$

–
–
4,840
1,213

$

Level 3
190
190
1,020
1,020

Total
$

190
190
20,177
2,535

301
–
–
14,014

–
759
454
3,626

–
–
1,020
–

301
759
1,474
17,641

14,014––––
14,316
–
–
–

417
3,209
–
–
–
4,840
843
–
843

–
–
2,594
263
2,331
3,805
–
345
345

14,432
3,209
2,594
263
2,331
22,961
843
345
1,188

79

10. Non-consolidated Financial Statements(3) Description of the evaluation methods and inputs used to measure fair valuei)Securities including monetary claims bought which are treated as securities based on “AccountingStandard for Financial Instruments” (ASBJ Statement No. 10)
Fair values of securities for which unadjusted quoted market prices in active markets are available
are categorized as Level 1, which mainly include listed stocks and government bonds. In the casethe market is inactive even if the quoted market price is available, those securities are categorized
as Level 2, which mainly include corporate bonds and foreign bonds. In the case the quoted market
price is not available, fair values are measured by evaluation methods such as discounting future
cash flows. In evaluation, the Company maximizes the use of observable inputs including swap
rates, interest rate swap spreads, currency basis and others. When significant unobservable inputs
are used to measure fair values, those securities are categorized as Level 3.
Fair values of investment trusts are measured at the disclosed net asset value and others.
Investment trusts for which transitional measures are applied in accordance with Paragraph 26 of“Implementation Guidance on Accounting Standard for Fair Value Measurement” (ASBJ Guidance
No. 31, issued on July 4, 2019) are not categorized into any level.

ii) Loans
As credit exposure for policy loans without specific repayment periods is limited to the amount of
the cash surrender value, the Company considers book value as fair value with assumption that fairvalue approximates book value in light of factors such as projected repayment period and interest
terms. Policy loans are categorized as level 3.
As for industrial and consumer loans, the fair value of loans is stated at theoretical prices calculatedby discounting the future cash flows to the present value by type of loan, using market interest
rates with some adjustments based on internal credit rating. Industrial and consumer loans are
categorized as level 3. The fair value of loans to legally bankrupt borrowers, substantially bankrupt
borrowers and borrowers with high possibility of bankruptcy is stated at the amounts by deducting
estimated losses from the book value before direct write-offs. Loans to legally bankrupt borrowers,
substantially bankrupt borrowers and borrowers with high possibility of bankruptcy are categorized
as level 3.
iii) Bonds payable
The fair value of bonds payable issued by the Company is stated at fair market value. Bonds
payable issued by the Company are categorized as level 2. The fair value of bonds payable forwhich designated hedge accounting (“Furiate-shori”) for currency swaps are applied is stated atfair market value added by the fair value of currency swaps. The Company adopts prices obtained
from external information venders as the fair value of currency swaps.
iv) Loans payableAs for loans payable, the fair value of loans is stated at theoretical prices calculated by discounting
the future cash flows to the present value, using market interest rates with some adjustments basedon the Companyʼs credit risk. Loans payable are categorized as level 3.
v) Derivative financial instruments
As for derivative financial instruments, the fair values of foreign currency forward contracts arestated at theoretical prices calculated by the Company based on the TTM at the balance sheet
date. The fair values of currency options, stock options and interest rate swaptions are stated at thequoted prices offered by counterparty financial institutions.
In evaluation of derivative financial instruments, the Company maximizes the use of observable
inputs. In the case unobservable inputs are not used or impact of unobservable inputs are notmaterial, derivative financial instruments are categorized as level 2. In the case significant
unobservable inputs are used, derivative financial instruments are categorized as level 3.

80

Asahi Mutual Life Insurance Company Annual Report 2022

10. Non-consolidated Financial Statements(4) Quantitative information about financial assets and liabilities measured and stated in the nonconsolidated balance sheet at fair value and categorized as Level 3i)Quantitative information on significant unobservable inputs
Quoted prices obtained from third parties are used for fair values categorized as level 3 without
adjustment.

ii) Reconciliation between the beginning and ending balance, and net unrealized gains (losses)
recognized as gains (losses) for the fiscal year
Millions of Yen

For the year ended March 31, 2022

Monetaryclaims bought

Securities

Available-forsale securities

Available-forsale securities

Others(i)
969

Foreign bonds(ii)¥
26,853

Beginning balance¥
Gains (losses) and net unrealized gains(losses) on available-for-sale securities,
net of tax recorded for the fiscal year:
Gains (losses) recorded for the fiscal
year *1
Net unrealized gains (losses) on
available-for-sale securities, net oftax recorded for the fiscal year
Net amount of purchase, sale, issue, andsettlement
Transfer to fair values of Level 3
Transfer from fair values of Level 3 *2
Ending balance
Net unrealized gains (losses) on financial
assets and liabilities held at the balance
sheet date among the amount recorded
to gains (losses) for the fiscal year*1

Derivative
financial
instruments

Total(i) + (ii)

Stock-related¥

27,822

¥

–

16

75

91

(24)

(20)

2,406

2,385

(24)

36

(2,330)(2,293)

–

(28)
–
–
957

10,711–(8,157)29,482

10,682–(8,157)30,440

294
–
–
270

–

2,406

2,406

(24)

*1 Those amounts are included in investment income and investment expenses in the non-consolidated statement of income.
*2 Those amounts are transferred from level 3 to level 2 since it has become possible to obtain observable data. Those transfers
were made at the end of the fiscal year.

Millions of U.S. Dollars

For the year ended March 31, 2022

Monetaryclaims bought

Securities

Available-forsale securities

Available-forsale securities

Others(i)

Foreign bonds
(ii)
$
219

Beginning balance$
Gains (losses) and net unrealized gains(losses) on available-for-sale securities,
net of tax recorded for the fiscal year:
Gains (losses) recorded for the fiscal
year *1
Net unrealized gains (losses) on
available-for-sale securities, net oftax recorded for the fiscal year
Net amount of purchase, sale, issue, andsettlement
Transfer to fair values of Level 3
Transfer from fair values of Level 3 *2
Ending balance
Net unrealized gains (losses) on financial
assets and liabilities held at the balance
sheet date among the amount recorded
to gains (losses) for the fiscal year*1

7

Derivative
financial
instruments

Total(i) + (ii)

Stock-related
$

227

$

–

0

0

0

(0)

(0)

19

19

(0)

0

(19)

(18)

–

(0)
–
–
7

87
–
(66)
240

87
–
(66)
248

2
–
–
2

–

19

19

(0)

*1 Those amounts are included in investment income and investment expenses in the non-consolidated statement of income.
*2 Those amounts are transferred from level 3 to level 2 since it has become possible to obtain observable data. Those transfers
were made at the end of the fiscal year.

8110. Non-consolidated Financial Statementsiii) Description of the fair value evaluation process
The Company establishes policies and procedures for measuring the fair value in the actuarial andaccounting department and the risk management department. In accordance with these policies
and procedures, the risk management department measures the fair value. The validity of theevaluation methods and inputs used to measure fair value and the appropriateness of categorizationof fair value are verified in the independent division in the risk management department.
In fair value measurement, valuation models in which the nature, characteristics and risks ofindividual assets are most appropriately reflected are used. In addition, when quoted prices
obtained from third parties are used, the validity of the prices is verified by appropriate methods
such as confirmation of evaluation method and used inputs and comparison with the fair values ofsimilar financial instruments.

7. Investments and Rental Properties
The Company holds investment and rental properties such as office buildings in Tokyo and other areas. The
carrying amounts and the fair values of investment and rental properties were ¥242,418million (US$1,980
million) and ¥285,844 million (US$2,335 million) as of March 31, 2022 and ¥247,811 million and ¥289,679
million as of March 31, 2021, respectively. The fair value is mainly based on the value (including someadjustments using the reference prices) of real estate appraisal report prepared by the external real-estateappraiser in accordance with real estate appraisal standards.

8. Securities Lent under Lending Agreements
The amounts of securities lent under lending agreements were ¥218,367 million (US$1,784 million) and¥265,606 million as of March 31, 2022 and 2021, respectively.

9. Claims
The total amount of claims against bankrupt and quasi-bankrupt obligors, claims with collection risk,delinquent loans three or more months past due and restructured loans, which were included in claims,
was ¥609 million (US$4 million) as of March 31, 2022.
i)

Claims against bankrupt and quasi-bankrupt obligors were ¥453 million (US$3 million) as of March
31, 2022.

ii) Claims with collection risk were ¥70 million (US$0 million) as of March 31, 2022.
iii) Delinquent loans three or more months past due were ¥66 million (US$0 million) as of March 31,
2022.
iv) Restructured loans were ¥20 million (US$0 million) as of March 31, 2022.
Claims against bankrupt and quasi-bankrupt obligors are claims to obligors who are subject to bankruptcy,
corporate reorganization or rehabilitation or other similar proceedings and other obligors in serious
financial difficulties.
Claims with collection risk are claims to obligors with deteriorated financial condition and results ofoperations from which it is unlikely that the principal and interest on the claims will be recovered, excluding
those claims classified as claims against bankrupt and quasi-bankrupt obligors.
Delinquent loans three or more months past due are loans for which interest payments or repayments ofprincipal are delinquent for three months or more from the due dates under the terms of the related loan
agreements, excluding those claims classified as claims against bankrupt and quasi-bankrupt obligors andclaims with collection risk.
Restructured loans are loans for which certain concessions favorable to borrowers, such as interest
reduction or exemptions, rescheduling of due dates of principal or interest payments, waivers of claim
or other terms, have been negotiated for the purpose of assisting and supporting the borrowers in the
restructuring of their businesses. This category excludes claims classified as claims against bankrupt andquasi-bankrupt obligors, claims with collection risk and delinquent loans three or more months past due.
The direct write-offs related to claims decreased the amount of claims against bankrupt and quasi-bankrupt
obligors described above by ¥24 million (US$0 million) as of March 31, 2022.

82

Asahi Mutual Life Insurance Company Annual Report 2022

10. Non-consolidated Financial Statements

Note for the fiscal year ended March 31, 2021

Loans
The total amount of loans to bankrupt borrowers, delinquent loans, delinquent loans three or more months
past due and restructured loans, which were included in loans, was ¥677 million as of March 31, 2021.
i)

Loans to bankrupt borrowers were ¥0 million as of March 31, 2021.

ii) Delinquent loans were ¥563 million as of March 31, 2021.
iii) Delinquent loans three or more months past due were ¥94 million as of March 31, 2021.
iv) Restructured loans were ¥20 million as of March 31, 2021.
Loans to bankrupt borrowers represent loans, excluding the balances already written-off, which meet theconditions prescribed in Article 96, Paragraph 1, Items 3 and 4 of the Enforcement Regulations of the
Corporate Tax Act. Moreover, accruing interest on these loans is not recorded as income after determiningthat principal of or interest on these loans is unlikely to be collected due to the significant delay inrepayment of principal or interest payments or for other reasons.
Accruing interest on delinquent loans is not recorded as income due to the same reasons as describedabove, and delinquent loans exclude loans to bankrupt borrowers and loans for which interest payments
have been suspended and rescheduled to assist and support the borrowers in the restructuring of theirbusinesses.
Delinquent loans three or more months past due are loans for which interest payments or repayments ofprincipal are delinquent for three months or more from the due dates under the terms of the related loan
agreements, excluding those loans classified as loans to bankrupt borrowers and delinquent loans.
Restructured loans are loans for which certain concessions favorable to borrowers, such as interest
reduction or exemptions, rescheduling of due dates of principal or interest payments, waivers of claim
or other terms, have been negotiated for the purpose of assisting and supporting the borrowers in the
restructuring of their businesses. This category excludes loans classified as loans to bankrupt borrowers,
delinquent loans and delinquent loans three or more months past due.
The direct write-offs related to loans decreased the amount of loans to bankrupt borrowers describedabove by ¥3 million as of March 31, 2021.
In addition, the direct write-offs related to loans decreased the amount of delinquent loans describedabove by ¥25 million as of March 31, 2021.

10. Accumulated Depreciation of Tangible Fixed Assets
Accumulated depreciation of tangible fixed assets totaled ¥286,537 million (US$2,341 million) and ¥285,435
million as of March 31, 2022 and 2021, respectively.

11. Separate Accounts
Total assets in separate accounts provided for in Article 118 of the Insurance Business Act were ¥28,175
million (US$230 million) and ¥28,078 million as of March 31, 2022 and 2021, respectively. The amounts ofseparate account liabilities were the same as separate account assets.

12. Receivables from/Payables to Subsidiaries
The total amounts of receivables from/payables to subsidiaries were ¥386 million (US$3 million) and ¥2,158
million (US$17 million) as of March 31, 2022 and ¥430 million and ¥2,104 million as of March 31, 2021,
respectively.

8310. Non-consolidated Financial Statements

13. Deferred Taxes(1) Deferred tax assets/liabilities were recognized as follows:
Millions of
U.S. Dollars

Millions of Yen
As of March 31
Deferred tax assets
Valuation allowance for deferred tax assets
Subtotal
Deferred tax liabilities
Net deferred tax assets (liabilities)

2022
¥

¥

2021

68,186
13,89754,28857,911(3,622)¥¥65,571
14,467
51,10473,930(22,826)

2022
$

$

557
113
443
473
(29)

Major components of deferred tax assets/liabilities were as follows:
Millions of Yen
As of March 31
Deferred tax assets
Contingency reserve
Reserve for price fluctuation
Reserve for employeesʼ retirement benefits
Impairment losses
Net unrealized losses on available-for-sale securities
Deferred tax liabilities
Net unrealized gains on available-for-sale securities

2022¥

21,731
13,450
8,327
7,223
4,394
56,416

Millions of Yen
As of March 31
Deferred tax assets
Contingency reserve
Reserve for price fluctuation
Reserve for employeesʼ retirement benefits
Impairment losses
Net unrealized losses on available-for-sale securities
Losses on valuation of securities
Deferred tax liabilities
Net unrealized gains on available-for-sale securities

2021¥

17,422
12,744
8,608
7,930
5,406
4,106
72,520Millions of
U.S. Dollars
As of March 31
Deferred tax assets
Contingency reserve
Reserve for price fluctuation
Reserve for employeesʼ retirement benefits
Impairment losses
Net unrealized losses on available-for-sale securities
Deferred tax liabilities
Net unrealized gains on available-for-sale securities

2022
$

177
109
68
59
35
460

(2) The statutory tax rates were 27.9% and 27.9% for the fiscal years ended March 31, 2022 and 2021,
respectively. The main factors causing the differences between the statutory tax rates and the actual
effective tax rates after considering deferred taxes were as follows:
For the year ended March 31
Interest on foundation funds
Change of valuation allowance for deferred tax assets

84

Asahi Mutual Life Insurance Company Annual Report 2022

2022(4.0)%(3.2)%

10. Non-consolidated Financial Statements

For the year ended March 31

2021

Change of valuation allowance for deferred tax assets
Interest on foundation funds
Reserve for dividends to policyholders(4.5)%(4.0)%(1.9)%

14. Reserve for Dividends to Policyholders
Millions of
U.S. Dollars

Millions of Yen
For the years ended March 31
Balance at the beginning of the fiscal year
Transfer to reserve from surplus in the previous fiscal year
Dividends to policyholders paid out during the fiscal year
Increase in interest
Balance at the end of the fiscal year

2022
¥

¥

30,050
2,153
3,562
3
28,6442021¥¥

32,073
1,794
3,820
3
30,050

2022
$

$

245
17
29
0
234

15. Stocks of Subsidiaries and Affiliates
The amounts of stocks of subsidiaries and affiliates the Company held as of March 31, 2022 and 2021 were¥37,377 million (US$305 million) and ¥21,367 million, respectively.
The Company provided capital of ¥17,000 million (US$138 million) to Nanairo Life Insurance Co., Ltd. on
April 15, 2022.

16. Pledged Assets
Assets pledged as collateral as of March 31, 2022 and 2021 were securities in the amount of ¥80,591 million(US$658 million) and ¥32,653 million, respectively.

17. Policy Reserves for the Reinsurance Contracts
Reserve for outstanding claims for the reinsurance contracts provided in accordance with Article 73,
Paragraph 3 of the Enforcement Regulation of the Insurance Business Act which applies mutatis mutandis
to Article 71, Paragraph 1 of the Enforcement Regulation of the Insurance Business Act (hereinafter “reservefor outstanding claims for ceded reinsurance”) were ¥9 million (US$0 million) and ¥6 million as of March 31,
2022 and 2021, respectively.
Policy reserves for the reinsurance contracts provided in accordance with Article 71, Paragraph 1 of the
Enforcement Regulation of the Insurance Business Act (hereinafter “policy reserves for ceded reinsurance”)
were ¥373 million (US$3 million) and ¥359 million as of March 31, 2022 and 2021, respectively.

18. Adjustment to Redemption of Foundation Funds and Appropriation of Net Surplus
The total amounts of adjustment to redemption of foundation funds and appropriation of net surplus
defined in Article 30, Paragraph 2 of the Enforcement Regulation of the Insurance Business Act were¥174,218 million (US$1,423 million) and ¥213,482 million as of March 31, 2022 and 2021, respectively.

19. Assets with Rights to Sell
The Company has the legal right to sell or collateralize securities borrowed under loan agreements.
The market values of these assets that were not sold or pledged as collateral as of March 31, 2022 and2021 were ¥25,709 million (US$210 million) and ¥72,634 million, respectively. No assets were pledged ascollateral as of March 31, 2022 and 2021.

85

10. Non-consolidated Financial Statements

20. Commitment LineAs of March 31, 2022 and 2021, there were unused commitment line agreements under which the Company
is the lender of ¥13,947 million (US$113 million) and ¥10,240 million, respectively.

21. Subordinated Bonds Payable
As of March 31, 2022 and 2021, bonds payable are subordinated bonds payable, for which the repayments
are subordinated to other obligations.

22. Subordinated Loans Payable
As of March 31, 2022 and 2021, loans payable are subordinated loans payable, for which the repayments
are subordinated to other obligations.

23. Contributions to Policyholders Protection Corporation
The estimated future contributions to the Life Insurance Policyholders Protection Corporation of Japan
under Article 259 of the Insurance Business Act as of March 31, 2022 and 2021 were ¥8,260 million (US$67
million) and ¥8,016 million, respectively. These contributions are charged as operating expenses in thefiscal years in which they are paid.

24. Reserve for Employeesʼ Retirement Benefits(1) Summary of retirement benefit plans
As defined benefit plan, the Company has defined benefit corporate pension plans, which are fundedtype, and lump-sum retirement allowance plans which are non-funded type but resulted in funded type
due to setting of employee pension trust.
(2) Defined benefit plani)

Reconciliation of beginning and ending balance of retirement benefit obligations
Millions of
U.S. Dollars

Millions of Yen
For the years ended March 31
Retirement benefit obligations at the beginning of
the fiscal year
Service cost
Interest cost
Actuarial difference occurred during the fiscal year
Retirement benefit payments
Retirement benefit obligations at the end of the
fiscal year

2022

2021

2022

¥

40,365
1,808
403
514
(3,602)¥

41,291
1,829
412
866
(4,035)

$

329
14
3
4
(29)

¥

39,489¥40,365$322ii) Reconciliation of beginning and ending balance of pension plan assets
Millions of
U.S. Dollars

Millions of Yen
For the years ended March 31
Pension plan assets at the beginning of the fiscal
year
Expected return on pension plan assets
Actuarial difference occurred during the fiscal year
Contributions by the employer
Retirement benefit payments
Pension plan assets at the end of the fiscal year

86

Asahi Mutual Life Insurance Company Annual Report 2022

2022
¥

¥

7,912
62
(809)
155
(197)
7,123

2021
¥

¥

6,507
55
1,371
151
(174)
7,912

2022
$

$

64
0
(6)
1
(1)
58

10. Non-consolidated Financial Statementsiii) Reconciliation of retirement benefit obligation and pension plan assets with reserve for employeesʼ
retirement benefits and prepaid pension cost presented on the non-consolidated balance sheets
Millions of
U.S. Dollars

Millions of Yen
As of March 31
a. Funded plan retirement benefit obligationb. Pension plan assets
c. a + b
d. Unrecognized actuarial differences
e. Net amount of liabilities and assets presented on
the non-consolidated balance sheet
f. Reserve for employeesʼ retirement benefits
g. Prepaid pension cost
h. Net amount of liabilities and assets presented on
the non-consolidated balance sheet

2022
¥

2021

39,489(7,123)32,365(2,836)¥29,52929,847(318)¥

29,5292022

40,365(7,912)32,452(1,829)

$

322
(58)
264
(23)

30,62330,856(233)¥

30,623

241
243
(2)
$

241

iv) Breakdown of retirement benefit expenses
Millions of
U.S. Dollars

Millions of Yen
For the years ended March 31
Service cost
Interest cost
Expected return on pension plan assets
Amortization of actuarial differences
Retirement benefit expenses related to defined
benefit plan

2022

2021

2022

¥

1,808
403
(62)
317

¥

1,829
412
(55)
95

$

14
3
(0)
2

¥

2,466

¥

2,281

$

20

v) Breakdown of main pension plan assets
The breakdown of main asset categories as a percentage of pension plan assets was as follows:
As of March 31
Stocks
Bonds
Others
Total

2022

2021

38%
10%
52%
100%

45%
9%
46%
100%

vi) Method for determining the expected long-term rate of return
To determine the expected long-term rate of return on pension plan assets, the Company takes into
account the present and future allocation of pension plan assets, and the present and expected
future long-term rate of return on the diverse range of assets that makes up the pension assets.
vii) Underlying actuarial assumptions
The main underlying actuarial assumptions were as follows:
As of March 31
Discount rate
Expected long-term rate of return on pension plan
assetsDefined benefit corporate pension plans

2022

2021
1.0%

1.0%

0.8%
1.6%

0.9%
1.6%

25. Subsequent Events
The Company resolved to redeem ¥40,000 million (US$326 million) of foundation funds, which is part of¥80,000 million of foundation funds offered in August 2015, on August 1, 2022, prior to the redemption
date, at the meeting of Board of Directors on May 19, 2022. Accompanying the redemption, the sameamount is scheduled to be transferred from reserve for fund redemption to reserve for redemption offoundation funds in accordance with Article 56 of the Insurance Business Act.
87

10. Non-consolidated Financial Statements

III. Notes to Non-consolidated Statements of Income
1. Transactions with Subsidiaries and Affiliates
The total amounts of revenues and expenditures in connection with subsidiaries and affiliates were ¥623
million (US$5 million) and ¥9,338 million (US$76 million) for the fiscal year ended March 31, 2022 and ¥1,067
million and ¥9,020 million for the fiscal year ended March 31, 2021, respectively.

2. Investment Income and Expenses
The major components of gains on sales of securities were as follows:
Millions of
U.S. Dollars

Millions of Yen
For the years ended March 31
Domestic bonds
Domestic stocks and other securities
Foreign securities

2022
¥

2021

4,943
6,238
767

¥

2022

9,357
3,331
2,559

$

40
50
6

The major components of losses on sales of securities were as follows:
Millions of
U.S. Dollars

Millions of Yen
For the years ended March 31
Domestic bonds
Domestic stocks and other securities
Foreign securities

2022
¥

2021

1,073
1,448
8,655

¥

2022

892
1,893
2,733

$

8
11
70

The major components of losses on valuation of securities were as follows:
Millions of
U.S. Dollars

Millions of Yen
For the years ended March 31
Domestic stocks and other securities
Foreign securities

2022
¥

2021
272
1

¥

2022
17
1

$

2
0

Losses on trading securities were losses on sales of ¥1,133 million (US$9 million) and losses on sales of ¥485
million for the fiscal years ended March 31, 2022 and 2021, respectively.
Losses on derivative financial instruments included net valuation gains of ¥641 million (US$5 million) andlosses of ¥2,667 million for the fiscal years ended March 31, 2022 and 2021, respectively.

3. Policy Reserves for the Reinsurance Contracts
Provision for reserve for outstanding claims for ceded reinsurance, which was deducted in calculating provision
for reserve for outstanding claims for the fiscal year ended March 31, 2022 was ¥2 million (US$0 million).
Provision for reserve for outstanding claims for ceded reinsurance, which was added in calculating reversalof reserve for outstanding claims for the fiscal year ended March 31, 2021 was ¥0 million.
Provision for policy reserves for ceded reinsurance, which was added in calculating reversal of policy
reserves for the fiscal year ended March 31, 2022 was ¥13 million (US$0 million).
Reversal of policy reserves for ceded reinsurance, which was deducted in calculating reversal of policy
reserves for the fiscal year ended March 31, 2021 was ¥6 million.

4. Impairment Losses of Fixed Assets
For the fiscal years ended March 31, 2022 and 2021, impairment losses of fixed assets by the Company
were as follows:88

Asahi Mutual Life Insurance Company Annual Report 2022

10. Non-consolidated Financial Statements(1) Method of grouping
The method of grouping is described in “Note 1. (15) Impairment losses of tangible fixed assets” of the
non-consolidated balance sheets.
Note for the fiscal year ended March 31, 2021
Real estate and other assets used for insurance business operations are classified as one asset groupas a whole. Other assets such as real estate for rent, real estate not in use and real estate scheduled tobe sold are classified as one group individually.
(2) Background information on recognizing the impairment losses
As the profitability of certain real estate for rent dropped down significantly due to a decrease in thelevel of rental income and a declining trend in the market prices of land, the Company reduced thebook values of such real estate for rent, real estate not in use and real estate scheduled to be sold totheir recoverable amounts. The write-downs were recognized as impairment losses and included in theextraordinary losses.
(3) Asset groups for which impairment losses were recognized and losses by classification of fixed assets
Millions of
U.S. Dollars

Millions of Yen
For the years ended March 31
Real estate for rent:
Land
Building
Total real estate for rent (i)Real estate not in use:Land
Building
Total real estate not in use (ii)Real estate scheduled to be sold:Land
Building
Total real estate scheduled to be sold (iii)
Total:Land
Building
Total (i) + (ii) + (iii)

2022
¥

¥

2021
–
–
–

¥

2022
721
156
877

$

–
–
–

622
526
1,149

457
141
598

5
4
9

–
–
–

1,309
185
1,494

–
–
–

622
526
1,149

2,488
483
2,971

5
4
9

¥

$

(4) Calculation method of recoverable amounts
The recoverable amounts of real estate for rent are determined at net realizable value or value in use.
The recoverable amounts for real estate not in use and real estate scheduled to be sold are net realizablevalue. Value in use is determined as the estimated net future cash flows, reflecting the volatility risk,
discounted at 3.3% and 3.4% for the fiscal years ended March 31, 2022 and 2021, respectively. Net
realizable value is calculated based on the appraisal value in accordance with “Real Estate Appraisal
Standards” or the publicly announced appraisal value after deducting expected disposal costs.

5. Extraordinary Losses
Note for the fiscal year ended March 31, 2021
The expenses related to salary guarantees for sales representatives and others as countermeasures toprevent the spread of COVID-19 for the fiscal year ended March 31, 2021 were ¥1,572 million, which were
included in other extraordinary losses.

The non-consolidated financial statements in this annual report have been audited by Ernst & Young ShinNihon LLC, an independentcertified public accountant.

89

11. Company Overview (as of March 31, 2022)

Tokyo Head Office

Tama Head Office

Company Name:

Asahi Mutual Life Insurance Company

Founded:March 1, 1888

Total Assets:

5.5041 trillion yen

Number of Offices:

58 branches; 568 sales offices (as of April 1, 2022)

Number of Employees:

18,345 (office staff: 4,104; sales representatives: 14,241)

Location of Tokyo Head Office:6-1, Yotsuya 1-chome, Shinjuku-ku, Tokyo 160-8570, Japan
Tel: 81-3-4214-3111

90

Asahi Mutual Life Insurance Company Annual Report 2022