NEWS RELEASE
August 9, 2017
Daisuke Iwase, President
LIFENET INSURANCE COMPANY(Securities Code: 7157, TSE Mothers)

Financial Results for 1Q of Fiscal 2017 Ending March 31, 2018
The number of policies-in-force exceeded 240,000
TOKYO, August 9, 2017 - LIFENET INSURANCE COMPANY (TSE Mothers 7157, President
Daisuke Iwase, URL: http://ir.lifenet-seimei.co.jp/en/) discloses financial results for the firstquarter of fiscal 2017 ending March 31, 2018.
1．Overview of the financial results for 1Q of fiscal 2017
(1) Business results
Condition of policies-in-force*1
Annualized premium of new business in 1Q ended June 30, 2017 was 343 million yen(100.5% of 1Q of fiscal 2016). The number of new business was 7,793 (106.7% of 1Q of fiscal*12016). Annualized premium of policies-in-force as of the end of 1Q of fiscal 2017 stands at
10,263 million yen (101.7% of March 31, 2017). The number of policies-in-force resulted in a*2
total of 243,610 (101.6% of March 31, 2017). Surrender and lapse ratio for 1Q of fiscal 2017
was 6.5% (7.0% for 1Q of fiscal 2016).
*1: Annualized premium is the amount of money equivalent to what is to be paid to have the insurance coverage for one
year. All payments for Lifenet products are in monthly installments, we calculate annualized premium as multiplying
the monthly premium by 12 months.
*2: The surrender and lapse ratio is the annual equivalent of the monthly number of policies surrendered and/or lapsed
divided by the monthly average number of policies-in-force.

Results of operations
Insurance premiums and other for the 1Q of fiscal 2017 increased to 2,588 million yen (105.9%
of 1Q of fiscal 2016) due to an increase in the number of policies-in-force. Investment income
grew to 54 million yen (106.2% of 1Q of fiscal 2016). Other ordinary income was 9 million yen. As
a result, ordinary income for 1Q of fiscal 2017 amounted to 2,651 million yen (102.2% of 1Q of
fiscal 2016).
Insurance claims and other was 467 million yen (82.9% of 1Q of fiscal 2016). The ratio of
insurance payment amounts to insurance premiums decreased to 15.7% for 1Q of fiscal 2017,
compared with 21.5% for 1Q of fiscal 2016. Provision for policy reserves and other came to 912
million yen (100.1% of 1Q of fiscal 2016). The ratio of provision for policy reserves to insurance
premiums was 34.9% for 1Q of fiscal 2017, compared with 38.8% for 1Q of fiscal 2016.
Operating expenses amounted to 1,005 million yen (116.8% of 1Q of fiscal 2016). The
components of operating expenses were 425 million yen in marketing expenses (125.4% of 1Q
of fiscal 2016), 166 million yen in customer service expenses (123.9% of 1Q of fiscal 2016), and413 million yen in system and other expenses (106.7% of 1Q of fiscal 2016). Other ordinary
expenses was 128 million yen (33.6% of 1Q of fiscal 2016) since the amortization of deferredassets under Article 113 of the Insurance Business Act is no longer recorded by the one-time
amortization in the previous fiscal year. Consequently, ordinary expenses for 1Q of fiscal 2017
totaled 2,514 million yen (92.4% of 1Q of fiscal 2016).
As a result, ordinary profit totaled 136 million yen for 1Q of fiscal 2017, compared with 125
million yen loss for 1Q of fiscal 2016. Net profit was 109 million yen, compared with 124 million
yen loss for 1Q of fiscal 2016.

Copyright© LIFENET INSURANCE COMPANY All rights reserved.

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NEWS RELEASE
In addition, fundamental profit, which is an indicator for the profitability of life insurancecompanies, amounted to 159 million yen, compared with 100 million yen loss for 1Q of fiscal 2016.
The components of fundamental profit were 616 million yen in mortality margin, 454 million yen
loss in expense margin and 2 million yen loss in interest margin.
(2) Financial condition
Assets, liabilities and net assets
Total assets as of June 30, 2017 amounted to 32,826 million yen (31,934 million yen as ofMarch 31, 2017). The major account balance was 26,691 million yen in securities mainly
consisting of government bonds and corporate bonds with high credit ratings.
Liabilities amounted to 19,068 million yen as of June 30, 2017 (18,288 million yen as of March
31, 2017), owing to an increase in policy reserves as a result of the increased insurance
premiums. The major account balances were 18,068 million yen in policy reserves (including
1,425 million yen in contingency reserves), and 345 million yen in reserves for outstanding
claims.
Net assets increased to 13,757 million yen as of June 30, 2017 (13,645 million yen as ofMarch 31, 2017) mainly due to the recording of net profit for 1Q of fiscal 2017.
The solvency margin ratio as of June 30, 2017 was 2,689.5% (2,723.0% as of March 31, 2017),
which indicated that an adequate level of payment capacity was maintained.
Cash flows
For 1Q of fiscal 2017, net cash provided by operating activities amounted to 902 million yen(758 million yen provided for 1Q of fiscal 2016) due to an increase in insurance premiums andother. Net cash used by investing activities amounted to 927 million yen (889 million yen used for
1Q of fiscal 2016) mainly due to acquisition of securities. Net cash used by financing activities
amounted to 4 million yen (2 million yen used for 1Q of fiscal 2016).
Based on these activities described above, cash and cash equivalents as of June 30, 2017
totaled 2,974 million yen (3,004 million yen as of March 31, 2017).
(3) Business forecasts
The business forecasts for fiscal 2017 is as shown below. This will be disclosed ordinary
income, ordinary profit (loss) and net income (loss).
(In millions of yen)
Ordinary income
Ordinary profit (loss)
Net income (loss)
Business forecasts(Fiscal 2017)

11,000(300)(Reference)
Results (Fiscal 2016)

10,096(2,031)

*1

(300)
*1

(1,889)*1

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

Copyright© LIFENET INSURANCE COMPANY All rights reserved.

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NEWS RELEASE
About LIFENET URL: http://ir.lifenet-seimei.co.jp/en/
Returning to the original purpose of life insurance - mutual support - LIFENET INSURANCE
was founded with the goal of offering simple, convenient and competitively priced products andservices based on the highest levels of business integrity. We sell these products and services
directly to customers over the Internet. By using the Internet, we are able to offer highly
cost-competitive products and accept applications from customers at any given time.
Contact:
Investor Relations, Corporate Planning DepartmentTel:+81-3-5216-7900
e-mail: ir@lifenet-seimei.co.jp
Disclaimer: This is a summarized translation of the original Japanese document, prepared and provided
solely for readers' convenience. In case of any discrepancy or dispute, the Japanese document prevails.

Copyright© LIFENET INSURANCE COMPANY All rights reserved.

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NEWS RELEASE
2. Non-consolidated Financial Statements(1) Balance Sheets(In millions of yen)March 31,
June 30,
2017
2017
ASSETSCash and deposits ·································································

1,004

974

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

1,999

1,999

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

995

1,501

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

26,372

26,691Government bonds····························································

9,876

8,772

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

1,496

1,496

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

11,751

12,566

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

334

337

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

819

800

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

2,095

2,717

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

123

114

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

502

534

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

1

1

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

30

66

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

904

941

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

742

761

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

161

180

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

31,93432,826

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

17,501

18,414311

345

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

17,18918,068Agency accounts payable ·······················································

39

32

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

68

73

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

469

337

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

19

21

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

19

21

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

189

190

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

18,28819,068

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

12,136

12,136

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

12,136

12,136

Retained earnings ·································································(11,116)(11,007)

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

13,157

13,266

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

488

491

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

488

491

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

13,645

13,757

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

31,93432,826NET ASSETS

Copyright© LIFENET INSURANCE COMPANY All rights reserved.

4NEWS RELEASE(2) Statements of Operations(In millions of yen)Three months ended June 30
2016
2017
Ordinary income······························································
2,594
2,651
Insurance premiums and other ····································
2,444
2,588
Premiums income ·················································
2,347
2,521
Reinsurance income··············································
97
66
Investment income ····················································
51
54
Interest, dividends and other income ·························
51
51
Gains on money held in trust ···································－
2
Other ordinary income ···············································
99
9
Reversal of reserves for outstanding claims ················
96－
Other ·································································
2
9
Ordinary expenses ························································
2,720
2,514
Insurance claims and other ·········································
564
467
Insurance claims ··················································
375
260
Benefits ······························································
130
134
Reinsurance commissions ······································
59
73
Provision for policy reserves and other ··························
911
912
Provision for reserves for outstanding claims ··············－
33
Provision for policy reserves ···································
911
879
Investment expenses ·················································
0
0Interest expenses ·················································
00
Losses on money held in trust ·································
0－
Operating expenses ··················································
861
1,005
Other ordinary expenses ············································
382
128
Ordinary profit (loss) ······················································
(125)
136
Extraordinary losses ······················································
1
1
Provision of reserves under the special laws ···················
1
1
Provision of reserve for price fluctuations ···················
1
1
Income (loss) before income taxes ····································
(126)
134
Income taxes-current ·····················································
025
Income taxes-deferred ····················································(3)－
Income taxes ································································(2)
25
Net income (loss) ··························································
(124)
109

Copyright© LIFENET INSURANCE COMPANY All rights reserved.

5NEWS RELEASE(3) Statements of Cash Flows(In millions of yen)Three months ended June 30
2016

2017

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

(126)

134

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

58

59

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

(96)

33

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

911

879

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

1

1

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

(51)

(51)

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

00Decrease (increase) in agency accounts receivable ···············

(0)

(0)

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

(69)

(35)

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

251

(25)

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

10

(6)

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

2

4

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

(146)

(136)

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

0(2)

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

745

853

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

87
(0)

52
(0)

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

(73)

(3)

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

758

902

Cash flows from investing activities
Purchase of money held in trust ·········································

－

(500)

Purchase of securities ······················································(1,001)(2,100)

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

200

1,770

Total of net cash provided by (used in) investment transactions ···

(801)

(830)

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

(42)
－
(87)
(889)

71
(8)
(88)
(927)

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

(2)

(4)

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

(2)

(4)

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

(132)

(29)

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

2,734

3,004

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

2,601

2,974

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6