Presentation Material

Consolidated Financial Resultsf thforthe Six
Si Months
M th Ended
E d d September
S t b 30,
30 2014
andSon Life’sSonyMarket Consistent Embedded Valueas of September 30
30, 2014

Sony Financial Holdings Inc.
N
Novemberb 14,
14 2014
Sony Financial Holdings Inc. All Rights Reserved

Content
 Consolidated Operating Results for the Six Months Ended September 30, 2014

P. 3

 Consolidated Financial Forecast for the Year Ending March 31
31, 2015

PP. 28

 Sony Life’s MCEV and Risk Amount Based on Economic Valueas of September 30
30, 2014
 Appendix

P
P. 30
P. 33

Disclaimers:
This presentation material contains statements concerning the current plans, expectations, strategies and beliefs of the Sony Financial Group. Anystatements contained herein that pertain to future operating performance and that are not historic facts are forward-looking statements . Forwardlooking statements may include —but are not limited to—words such as “believe,” “anticipate,” “plan,” “strategy,” “expect,” “forecast,” “predict,” and“possibility” that describe future operating activities, business performance, events or conditions. Forward-looking statements, whether spoken or
written,, are based on judgments
j gmade byy the managementgof the Sonyy Financial Group,p, based on information that is currently
y available to it. As
such, these forward-looking statements are subject to various risks and uncertainties, and actual business results may vary substantially from theforecasts expressed or implied in forward-looking statements. Consequently, investors are cautioned not to place undue reliance on forward-looking
statements. The Sony Financial Group disclaims any obligation to revise forward-looking statements in light of new information, future events or otherfindings. The information contained in this presentation does not constitute or form part of any offer for sale or subscription of or solicitation or
invitation of any offer to buy or subscribe for any securities, nor shall it or any part of it from the basis of or be relied on in connection with any
contract or commitment whatsoever.
*Unless otherwise indicated, in these materials figures less than the indicated unit have been truncated, while ratios and percentage changes have been rounded.
Also, a “–” is used where percentage changes exceed 1,000% and in cases where one or both comparisons are negative.
* “Lifeplanner” is a registered trademark of Sony Life.

Sony Financial Holdings Inc. All Rights Reserved2Consolidated Operating Results for
the Six Months Ended September 30,
30 2014

Sony Financial Holdings Inc. All Rights Reserved

3

Highlights of Consolidated Operating Performancefor the Six Months Ended September 30, 2014 (1)Consolidated ordinary revenues

FY13.1H

FY14.1H

Ordinary revenues

549.2

579.4

+30.2

+5.5%

Ordinary profit

30.2

40.1

+9.9

+32.9%

Non-life
Insurancebusiness

Ordinary revenues

44.9

46.4

+1.5

+3.4%

Ordinary profit

2.8

3.4

+0.5

+19.6%

Bankingbusiness

Ordinary revenues

18.3

18.6

+0.3

+1.9%

Ordinary profit

3.5

3.2

(0.3)

(9.0%)

Intersegment
adjustments*
adjustments

Ordinary revenues

(1.3)

(1.4)

(0.1)

－

01
0.1

01
0.1

(0 0)
(0.0)

(23 8%)(23.8%)

Ordinary revenues

611.1

643.0

+31.9

+5.2%

Ordinary profit

36.8

46.9

+10.1

+27.6%Net income

20.8

31.1

+10.2
10.2

+49.3%
49.3%(Billions of yen)

Consolidated ordinary profit

611.1
611
1((*))

+5 2%
+5.2%

+27.6%

Life
I
Insurancebusiness

643.0

46.9
Consolidated

36.8
FY13.1HO diOrdinary
profitfit

FY14.1H(Billions of yen)(*) Banking business revised its method of recording ordinary
revenues and ordinary expenses on hedge transactions for
FY14.1H. Ordinary revenues for FY13.1H have been
retroactively adjusted to reflect the change. Consequently,
consolidated ordinary revenues for FY13.1H have beenrevised from ¥610.7 billion to ¥611.1billion. As adjustments toordinary revenues were accompanied by adjustments in thesame amountt to
t ordinarydiexpenses, ordinarydiprofitfit andd nettincome were unaffected.

(Billions of yen)

14.3.3114.9.30

ChangeChange from
14.3.31

Total assets

8 841 38,841.3

9,120.2+278 8+278.8

+3 2%
+3.2%

Net assets

4,67.0

504.7

+37.7

+8.1%

Consolidated*Ordinary profit in “Intersegment adjustments” is mainly from SFH.
*Comprehensive income: FY13.1H: ¥13.5 billion, FY14.1H: ¥44.7 billion

Sony Financial Holdings Inc. All Rights Reserved

4Highlights of Consolidated Operating Performancefor the Six Months Ended September 30, 2014 (2) Life Insurance Business: Policy amount in force increased steadily during the six months ended

September 30, 2014, reflecting a record-high new policy amount for the first half (April 1 to September 30).
Ordinary revenues increased compared with the same period of the previous fiscal year due to anincrease in income from insurance premiums reflecting a steady increase in policy amount in force andhigher interest income and dividends on general account assets. Ordinary profit increased year on year
due mainly to two reasons: the absence of the negative impact from the revision of the discount rate used
for calculating policy reserves on the interest rate-sensitive whole life insurance that was present in thesame period of the preceding fiscal year, and an increase in gains on sales of securities in the generalaccount in this first half.
 Non-life Insurance Business: Ordinary revenues expanded year on year owing to an increase in net

premiums written primarily for mainstay automobile insurance. Ordinary profit grew year on year due to a
decline in the loss ratio mainly led by a lower car accident ratio
ratio, as well as the rise in ordinary revenues
revenues.
 Banking Business: Ordinary revenues increased year on year due to higher gains from bond-dealingtransactions. In spite of the increase in ordinary revenues, ordinary profit decreased due mainly to two
reasons: lower volume on foreign exchange transactions stemming from passive foreign currency trading
by customers compared with the same period off the previous fiscalfyear when foreignfcurrency exchange
rates fluctuated wildly, and an increase in operating expenses.
 Consolidated ordinary revenues increased 5.2% compared with the same period of the previous fiscal

yyear,
to ¥643.0 billion, owing
g to increases in ordinary
y revenues from all the businesses: life insurance,
non-life insurance and banking. Consolidated ordinary profit increased 27.6% year on year, to ¥46.9
billion. By business segment, ordinary profit from the life insurance and the non-life insurance businesses
increased, whereas ordinary profit from the banking business decreased. Consolidated net income was up
49.3% yyear on year,yto ¥31.1 billion, reflecting
g the rise in ordinaryyp
profit, and the change
g of the calculation
policy of the reserve for price fluctuations for Sony Life.
Sony Financial Holdings Inc. All Rights Reserved

5Highlights of Operating Performance:
Sony Life (Non-consolidated)
Ordinary revenues

Ordinary profit

549.5

40.4

FY13.1H

FY14.1H

549.5

579.3

+29.8

+5.4%

Income from insurance premiums

437.9

454.0

+16.0

+3.7%

I
Investmenttt income
i

107 6
107.6

120 8
120.8

+13.1
13 1

+12.2%
12 2%Interest income and dividends

58.9

65.8

+6.9

+11.7%

Income from monetary trusts, net

2.6

2.6

(0.0)

(1.1%)

Gains on sale of securities

0.0

3.8

+3.8

－

Gains on separate accounts, net

45.8

46.4

+0.6

+1.4%

518.2

538.9

+20.7

+4.0%

Insurance claims and other payments

155.0

173.0

+17.9

+11.6%

Provision for policy reserves and others

294.0

293.6

(0.3)

(0.1%)

Investment expenses

4.0

4.5

+0.4

+11.8%

Operating expenses

55.8

56.8

+0.9

+1.7%

Ordinary profit

31.3

40.4

+9.1

+29.2%Net income

17 6
17.6

26 9
26.9

+9 2
+9.2

+52 3%+52.3%

14.3.3114.9.30

Change from 14.3.31

Securities

5,954.7

6,235.6+280.9+4.7%

Policyy reserves

6,123.6,

6,413.4,+289.7

+4.7%

369.2

402.4

+33.2

+9.0%

83.4

97.0

+13.5

+16.3%

6,624.9

6,959.1+334.2

+5.0%

640 5
640.5

702 0
702.0

+61 4
+61.4

+9 6%
+9.6%

(Billions of yen)

Ordinary revenues

+5.4%

31 3
31.3

FY13.1H

579.3+29.2%

FY14.1H (Billions of yen)

◆ Ordinary revenues and ordinary profit increased year on year.
◆ Income from insurance p
premiums increased due to a steadyygrowth in policy amount in force.
◆ Investment income increased due mainly to higher interest
income and dividends on general account assets.
◆ Ordinary profit increased year on year due mainly to two
reasons: the absence of the negative impact from the revisionof the discount rate used for calculating policy reserves on theinterest rate-sensitive whole life insurance that was present in
the same period of the preceding fiscal year, and an increase ingains on sales of securities in the general account in this first
half.
◆ Net income was up year on year reflecting the rise in ordinary
profit, and the change of the calculation policy of the reserve forprice flfluctuations.
ct ations The change wasas to accumulate
acc m late the reserve
reser eup to required levels from FY14 while it had accumulated thereserve in excess of the required levels until FY13.

Ordinary expenses(Billions of yen)

Net assets
Net unrealized gains on other securities
Total assets
Separate account assets

Sony Financial Holdings Inc. All Rights Reserved

Change6Overview of Operating Performance:
Sony Life (Non-consolidated)
FY13.1H

FY14.1H

Change<Reasons for changes>

1,874.8

2,127.3+13.5%

Lapse and surrender amount

876.4

862.5

(1.6%)

Lapse and surrender rate

2.32%

2.21%

(0.11pt)◆ Increased due to higher sales of U.S.
dollar denominated insurance,
variable life insurance and term-life
insurance.

Policy amount in force

38,357.1

39,952.7+4.2%

Annualized premiums from new policies

30.1

36.2

+20.0%Of which,hi h thi
third-sectordt products
d t

69
6.9

65
6.5

(5 1%)(5.1%)

681.4

715.4

+5.0%

165.0

169.7

+2.9%

FY13.1H

FY14.1H

ChangeGains from investment, net (General account)

57.7

69.8

+20.9%

Core profit

33.5

38.5

+14.9%

Positive spread

33
3.3

55
5.5

+66 7%+66.7%(Billions of yen)

New policy amount

Annualized premiums from insurance in force
Of which, third-sector products(Billions of yen)

Non-consolidated solvency margin ratio

14.3.3114.9.30

Change from
14.3.312,358.7%

2,510.4%+151.7pt

Notes:
1. Figures for new policy amount, lapse and surrender amount, lapse and surrender rate, policy amount in force,
annualized premiums from new policies and annualized premiums from insurance in force are calculated as
the total of individual life insurance and individual annuities.
2. The lapse and surrender rate shows the ratio derived by dividing the amount of lapses and surrenders, notadjusted for policy amount decreases, increases, and reinstatements, by the policy amount in force at the
beginning of the fiscal year

◆ Decreased in each product.

◆ Increased reflecting an increase in
new policy amount and higher salesof endowment insurance andeducational endowment insurance.

◆ Increased year on year, due mainly totheh absenceb
off theh negative
i iimpactfrom the revision of the discount rateused for calculating policy reserves
on interest rate-sensitive whole life
insurance that was present in thesame periodi d off th
the precedingdi fi
fiscallyear.

Sony Financial Holdings Inc. All Rights Reserved

7

Operating Performance :Sony Life (Non-consolidated) (1)
Number and Amount of New Policies

Annualized Premiums from New Policies(Individual Life Insurance + Individual Annuities)(Individual Life Insurance + Individual Annuities)

New policy amount

Annualized premiums from new policies

Number of new policies

Of which,which third-sector(Thousands ofpolicies)(Billions of yen)(Trillions of yen)274

+15 9%+15.9%

286

300

246

30,0003.0

40
35

25,0002.01
20,0002.0+13.5%

1.87

2 12
2.12

200

36.2
32.1

30.1

30

+20.0%

25
20

15 00015,000100

1.0
10,000

15
10

5,000

5

0
FY12.1H

FY13.1H

FY14.1H

0

8.1

6.9

FY12.1H

FY13.1H(5.1%)

6.5

0Sony Financial Holdings Inc. All Rights Reserved

FY14.1H

8

Operating Performance :Sony Life (Non-consolidated) (2)
Number and Amount of Policies in Force

Annualized Premiums from Insurance in Force(Individual Life Insurance + Individual Annuities)(Individual Life Insurance + Individual Annuities)

Policyy amount in force(Trillions of yen)

50

6.16

+5.4%

Annualized premiums from insurance in force

Number of p
policies in force

6.33

6.49

Of which, third-sector(Millions of policies)(Billions of yen)
681.4
700

+2.6%

+5.0%

715.4

696.9
+2 6%
+2.6%

6
40

38.3

+4.2%

600

39.9

39.0

5

+2.2%

500
4

30

400
3

20
2

300

200

+2.9%

10

0

13.9.30

14.3.3114.9.30

1

100

0

0

165.0

167.0

13.9.30

14.3.31Sony Financial Holdings Inc. All Rights Reserved

+1.6%
1 6%

169.7

14.9.30

9

Operating Performance :Sony Life (Non-consolidated) (3)Lapse and Surrender Rate*(Individual Life Insurance + Individual Annuities)(%)

10

Lapse and surrender rate
(Annual)

Lapse and surrender rate
(1H)

8

6

5.31
5
3
4.61

4
(0 11pt)(0.11pt)

2

2.65

2.32

FY12

FY13

2.21

0
FY14

*The lapse and surrender rate shows the ratio derived by dividing the amount oflapses and surrenders, not adjusted for policy amount decreases, increases, andreinstatements, by the policy amount in force at the beginning of the fiscal year.

Sony Financial Holdings Inc. All Rights Reserved

10Operating Performance :Sony Life (Non-consolidated) (4)Income from Insurance Premiums

Interest Income and Dividends(Billions of yen)(Billions of yen)

500

428.8

454.0

437.9

65.8

70
+11 7%+11.7%
+3.7%

400

58.9

60

52.1
50
300

40
200

30
20

100

10
0
FY12.1H

FY13.1H

FY14.1H

0
FY12.1H

Sony Financial Holdings Inc. All Rights Reserved

FY13.1H

FY14.1H

11

Operating Performance :Sony Life (Non-consolidated) (5)Core Profit

Ordinary Profit(Billions of yen)(Billions of yen)

38.5

40

33.3

40.4
40

33.5
+14.9%
14 9%

30

31.3

31.3

FY12.1H

FY13.1H

30

20+29.2%

20

10

10

0

0
FY12.1H

FY13.1H

FY14.1H(Reference) Impact on core profit
Positive (Negative) spread (*1)
Provision of policy reserves for minimum
guarantees for variable life insurance (*2)
Effects by the revision of policy reserve
discount rate (Interest rate-sensitive
rate sensitive whole life
insurance ) (*3)(Billions of yen)

FY12.1H FY13.1H
(0.4)
3.3

FY14.1H
5.5

(4.0)

(1.2)

(2.5)

-

(5 7)
(5.7)

-

FY14.1H(Reference) Main differences from Core Profit(Billions of yen)

FY12.1H

FY13.1H

Capital gains (loss)

0.1

(0.0)

FY14.1H
4.4

Provision of contingency reserve (*2)

(1.9)

(2.1)

(2.4)

*1: The minus amount in positive spread indicates negative spread.
*2: “Provision of p
policyy reserves for minimum gguarantees for variable life insurance” and“Provision of contingency reserve” are described as negative amount.
*3: The effect of the revision of policy reserve discount rate on interest rate-sensitive whole life
insurance in May 2013.

Sony Financial Holdings Inc. All Rights Reserved

12

Operating Performance :Sony Life (Non-consolidated) (6)
Number of Lifeplanner Sales Employees+123(Number)

4,500

4,133
4
133
[105]

4,127
4
127
[109]

4,125
4
125
[110]

13.3.3113.6.30

13.9.30

4,092
[121]

4,216
[138]

4,248
[150]

4,228
[146]
+20

4,000

3 500
3,500

3,000
0

13.12.31

14.3.3114.6.30

14.9.30

Note: Figures in [ ] show the numbers of Lifeplanner sales employees (rehired on a fixed-term contract basis after retirement) included in the overall
numbers, those who have reached retirement age but who continue to work as Lifeplanner sales employees that meet certain sales conditions
and other requirement.

Sony Financial Holdings Inc. All Rights Reserved

13

Operating Performance :Sony Life (Non-consolidated) (7)Breakdown of General Account Assets
14.3.31<Asset management review>

14.9.30(Billions of yen)Amount%Japanese governmentand corporate bonds

5,190.0,

86.7%

5,390.7,

86.2%

Japanese stocks

33.2

0.6%

36.1

0.6%

Foreign bonds

79.8

1.3%

93.5

1.5%

Amount%We have continued to accumulate ultralongterm bonds to match the liability
characteristics of insurance policies withlong term matlong-term
maturities
rities with
ith the aim of red
reducing
cing
interest rate risk.
<Bond duration>
Mar. 31, 2013: 19.9 years

Foreign stocks

26.9

0.4%

26.6

0.4%

Monetary trusts

305.3

5.1%

308.8

4.9%

Policy loans

154.1

2.6%

158.5

2.5%

Real estate

66.5

1.1%

118.5

1.9%

Cash and call loans

32.6

0.5%

35.9

0.6%

Others

95.6

1.6%

88.1

1.4%

5 984 3
5,984.3

100 0%
100.0%

6 257 06,257.0

100 0%
100.0%

Total

Mar. 31, 2014: 19.7 years
Sep. 30, 2014: 19.8 years■ Investment in the monetary trusts is mainly into
Japanese government and corporate bonds.
■ The holding ratio on the real status of Japanese
government and corporate bonds including
those invested in monetary trusts in the generalaccount assets: As of Sep. 30, 2014: 91.1%(As of Mar. 31, 2014: 91.8%)

Sony Financial Holdings Inc. All Rights Reserved

14

Operating Performance :Sony Life (Non-consolidated) (8)Non-consolidated Solvency Margin Ratio

(%)

3,000

2,510.4
2,500

2,281.8

2,358.7+151.7pt

2,000

1,500

1,000
0
13.3.3114.3.3114.9.30

Sony Financial Holdings Inc. All Rights Reserved

15

Operating Performance :AEGON Sony Life Insurance*AEGON Sony Life Insurance sells individual variable annuities.

Number and Amount of Policies in Force

Number and Amount of New Policies
New policy amount(Billions of yen)

Number of new polices [ ]83.3[14.3]

90
80

16
63.8
[10.8]

70(Thousands ofpolicies)

Policy amount in force(Billions of yen)

350

14

200

40

20

50
40

10
8

10
0
FY12.1H

FY13.1H

155.8[24.1]

30

150

6
18.3
[2.5]

60

236.4
236
4
[38.2]

250

50

30

298.2
[48.5]

300

12

60

Number of policies in force [ ] (Thousands ofpolicies)

4

100

2

50

0

0

FY14.1H

20
10
0
13.9.30

14.3.3114.9.30

Net income (losses) for AEGON Sony Life Insurance and SA Reinsurance
FY13 1H
FY13.1H

Ch
ChangeFY14 1H
FY14.1H

AEGON Sony Life Insurance

(1.7)

(2.4)

(0.7)

SA Reinsurance

0.1

1.7

＋1.6

AEGON Sony Life Insurance and SA Reinsurance are equity method companies
companies, 50-50 joint venture established by Sony Life and AEGON Group.
Group
SA Reinsurance prepares its financial statements in accordance with U.S. GAAP. 50% of the net income (losses) for AEGON Sony Life Insurance andSA Reinsurance are recognized as investment profit (losses) on equity method in the SFH’s consolidated net income.

Sony Financial Holdings Inc. All Rights Reserved

16

Highlights of Operating Performance:
Sony Assurance
Ordinary revenues

44.9

Ordinary profit+3.4%

FY13.1H

FY14.1H

44.9

46.4

+1.5

+3.4%

Underwriting income

44.2

45.7

+1.4

+3.3%

Investment income

0.5

0.6

+0.0

+5.1%

42.0

42.9

+0.9

+2.2%

Underwriting expenses

31.7

32.0

+0.2

+0.7%

Investment expenses

0.0

0.0

(0.0)

(99.7%)

Operating general andadministrative expenses

10.2

10.9

+0.7

+7.0%

Ordinary profit

2.8

3.4

+0.5

+19.6%Net income

18
1.8

23
2.3

+0 5
+0.5

+29 4%+29.4%

14.3.3114.9.30(Billions of yen)

Ordinary revenues

46.4

Ordinaryy expensesp

3.4+19.6%

2.8

FY13.1H

FY14.1H(Billions of yen)

◆ Ordinary revenues and ordinary profit increased
year on year.
◆ Ordinary revenues increased year on year, due
to an increase in net premiums written primarily
for its mainstay automobile insurance.
◆ Ordinary profit grew year on year due to a
decline in the loss ratio mainly led by a lower
car accident ratio, as well as the rise in ordinary
revenues.

(Billions of yen)

ChangeChange from
14.3.31

Underwriting reserves

78 0
78.0

82 4
82.4

+4.4
4.4

+5.6%
5.6%

Net assets

21.4

24.1

+2.7

+12.8%

Total assets

142.7

149.4

+6.7

+4.7%

Sony Financial Holdings Inc. All Rights Reserved

17Overview of Operating Performance:
Sony Assurance(Billions of yen)

FY13.1H

ChangeFY14.1H<Reasons for changes>

Direct premiums written

43.6

45.0

+3.3%

Net premiums written

44.2

45.7

+3.3%

Net losses paid

23.2

22.4

(3.8%)

Underwriting profit

2.3

2.8

+22.8%Net loss ratio

59.6%

56.4%

(3.2pt)Net expense ratio

24.6%

25.4%

+0.8ptCombined ratio

84.2%

81.8%

(2.4pt)◆ Increased mainly in its mainstay
automobile insurance.
◆ Declined due mainly to a lower car
accident ratio.

◆ Increased
I
d due
d
mainlyi l tto hihigherhsystem-related expenses, a rise ininsurance acquisition cost and a
consumption tax rate rise.

Notes:Net loss ratio = (Net losses paid + Loss adjustment expenses ) / Net premiums written.
Net expense ratio = Expenses related to underwriting / Net premiums written

Number of policies in force
Non-consolidated
Nonconsolidated
solvency margin ratio

14.3.3114.9.30

Change from 14.3.31

1.61 million

1.65 million+0.04 million

527.6％

596.3%+2.7%+68.7pt

Note: The number of policies in force is the total of automobile insurance and medical and cancer insurance,
which accounts for 99% of net premiums written.

Sony Financial Holdings Inc. All Rights Reserved18Sony Assurance’s Underwriting Performanceby Type of Policy
Direct Premiums Written

Net Premiums Written

FY13.1H

FY14.1H

Fire

115

119

+3.3%

Marine－－－Personal accident

4,124

4,277

+3.7%

Voluntary automobile

39,391

40,671

+3.2%

－

－

－

43 632
43,63245,069

+3 3%
+3.3%

(Millions of yen)Compulsory
automobile liability
Total

FY13.1H

FY14.1H

Change

Fire

82

16

(80.0%)

Marine6884+22.8%

Personal accident

4,254

4,411

+3.7%

Voluntary automobile

39,26440,568+3.3%

Compulsory
automobile liability

608

671

+10.2%

44,27945,752+3.3%
3.3%

Change(Millions of yen)

Total

*SURE, medical and cancer insurance is included in personal accident.

Net losses paid
FY13.1H

FY14.1H

Fire

0

2

+340.6%

Marine7773(5.0%)

Personal accident

1 010
1,010

1 128
1,128

+11.7%
11 %Voluntary automobile

21,667

20,616(4.9%)

Compulsory
automobile liability

544

601

+10.4%

Total

23,29922,420(3.8%)(Millions of yen)

ChangeSony Financial Holdings Inc. All Rights Reserved

19

Operating Performance:
Sony Assurance (1)Ordinary Profit andAdjusted Ordinary Profit

Net Premiums Written andNumber of Policies in Force
Voluntary automobile insurance
Personal accident insurance
OthersNumber of policies in force(Billions of yen)O diOrdinary
profitfit

48
4.8

Adj t d ordinary
Adjusteddiprofit
fit

4.5
+5.3%

(Billions of yen)

1 53
1.53

1 57
1.57

(Millions of

1.65 ppolicies))

34
3 3 +19.6% 3.4
3.3

3.5

2.8

1.6

50

41.8

44.2

+3.3%

45.7
0.7 1.4

4.4

40

2.5

1.2
1

30

40.5

1.5

0.8
0.5

20

(0.1)

0.6
0.4

10
0.2
0

0
FY12.1H

FY13.1H

FY14.1H

The numberTh
b off policies
li i iin fforce iis th
the ttotalt l off automobilet
bil iinsurance andd medical
di land cancer insurance policies, which account for 99% of net premiums written.
More than 90% of personal accident insurance is medical and cancer insurance.

04
0.4

-0.5
FY12 1H
FY12.1H

FY13 1H
FY13.1H

FY14 1H
FY14.1H*Adjusted ordinary profit = Ordinary profit + Provision for catastrophe reserve(Reference) Provision for catastrophe reserve
FY12.1H
p reserve((0.6))
Provision for catastrophe(Billions of yen)

FY13.1H
0.4

FY14.1H
1.4*Provision for catastrophe reserve is described as positive amountSony Financial Holdings Inc. All Rights Reserved

20

Operating Performance:
Sony Assurance (2)Earned/Incurred Loss Ratio +Net Expense Ratio
E
Earned/Incurredd/Id loss
l
ratio
ti
(%)
100

98.9

93.8

(Net Loss Ratio+ Net Expense Ratio)
N t loss
Net
l
ratio
ti

N t expense ratio
Net
ti

90.5

73 3
73.3

60

65.9
62.4
(3.5pt)

68.2

84 9
84.9

87 7
87.7

84.2

80

81.8
(2.4pt)

62.0
63.2

59.6

59.3

(3.2pt)

56.4

40

40

20

89.2

87.8
(2.7pt)72.9

N t expense ratio
Net
ti

(%)
100

99.0

80

60

＜参考＞ (Reference) Combined Ratio

26.0

25.6

20

+0.8pt

25.7

24.6

25.4

FY13.1H

FY14.1H

26.0

25.6

+0.8pt

25.7

24.6

25.4

FY12.1H

FY13.1H

FY14.1H

0

0
FY12

FY13

FY12.1H

Notes:
Earned/Inc rred loss ratio = (Net losses paid + Provision
Earned/Incurred
Pro ision for reserve
reser e for outstandingo tstanding
losses + Loss adjustment expenses) / Earned premiums[Earthquake insurance and compulsory automobile liability insurance are excluded
from the above calculation.]

FY12

FY13

Notes:Net loss ratio = (Net losses paid + Loss adjustment expenses ) / Net premiums written
Net expense ratio = Expenses related to underwriting / Net premiums writtenSony Financial Holdings Inc. All Rights Reserved

21

Operating Performance:
Sony Assurance (3)Non-consolidated Solvency Margin Ratio

(%)

800

504 2%
504.2%

527 6%
527.6%

596.3%+68.7pt

400

013.3.3114.3.3114.9.30

Sony Financial Holdings Inc. All Rights Reserved

22Highlights of Operating Performance:
Sony Bank (Consolidated/Non-consolidated)
Consolidated ordinary revenues
Consolidated ordinary profit<Consolidated>

18.3
+1.9%

3.5

FY13.1H

FY13.1H

FY14.1H

Consolidated ordinary revenues

18.3

18.6

+0.3

+1.9%

Consolidated ordinary profit

3.5

3.2

(0.3)

(9.1%)

Consolidated net income

2.2

2.0

(0.1)

(8.8%)

FY13.1H

FY14.1H

Ordinary revenues

17.0

17.3

+0.2

+1.4%

Gross operating profit

11.0

10.6

(0.3)

(3.2%)Net interest income

8.8

8.2

(0.5)

(6.2%)

N t feesNetfandd commissions
i i

(0 1)
(0.1)

(0 3)
(0.3)

(0 1)
(0.1)

―

Net other operating income

2.3

2.6

+0.3

+13.7%

General and administrative expenses

7.2

7.5

+0.2

+3.6%

Net operatingpg profit
p

3.7

3.1

(0.6)

(17.4%)

Ordinary profit

3.6

3.2

(0.4)

(11.9%)Net income

2.3

2.0

(0.2)

(10.3%)(Billions of yen)

18.6

(9.1%)

3.2<Non-consolidated>(Billions of yen)

FY14.1H(Billi(Billions
off yen))<Consolidated>◆ Ordinary revenues increased year on year, due to higher gains
from bond-dealing transactions. In spite of the increase in ordinary
revenues, ordinary profit decreased due mainly to two reasons: lower
volume on foreigng exchange
g transactions stemmingg from p
passiveforeign currency trading by customers compared with the same
period of the previous fiscal year when foreign currency exchange
rates fluctuated wildly, and an increase in operating expenses.
<Non-consolidated>◆Both gross operating profit and net operating profit decreased
year on year, due to lower gains on foreign exchangetransactions as the same reason as in the consolidated results.
・Net interest income decreased year on year. Behind this drop was
lower interest income on securities under the lowering interest
rates.
・Net fees and commissions decreased year on year due to lower
fees on investment trusts and higher fees paid for ATM usage.
・Net
N t otherth operatingti incomeiiincreased
d year on year ddue
to higher net gains on bond-dealing transactions, despite lower
gains on foreign exchange transactions.

Change(Billions of yen)

Net assets
Net unrealized gains onother securities, net of taxes
Total assets

Change14.3.3114.9.30

Change from 14.3.31

72.7

74.0

+1.2

+1.7%

7.2

6.3

(0.8)

(12.2%)

2 056 72,056.7

1 996 2
1,996.2(60 4)(60.4)(2 9%)(2.9%)(*) Sony Bank revised its method of recording ordinary revenues and ordinary expenses on hedge transactions
for FY14.1H. Ordinary revenues for FY13.1H have been retroactively adjusted to reflect the change.

Sony Financial Holdings Inc. All Rights Reserved

23

Overview of Operating Performance:
Sony Bank (Non-consolidated) (1)<Reasons for changes>
Change from
14.3.3113.9.30

14.3.31

Customer assets

1,930.7

2,007.5

1,945.2(62.2)(3.1%)

Deposits

1,813.0

1,890.0

1,824.6(65.3)(3.5%)

Yen

1 435 1
1,435.1

1 526 4
1,526.4

1,483.8(42 6)(42.6)(2 8%)(2.8%)

377.9

363.5

340.8

(22.7)(6.2%)

Investment trusts

117.6

117.4

120.5

+3.0

+2.6%

L
Loans
outstandingt t di

1 009 5
1,009.5

1 057 4
1,057.4

1 092 1
1,092.1

+34 6
+34.6

+3 3%
+3.3%

Mortgage loans

899.6

949.3

983.2

+33.9

+3.6%

Others

109.9

108.1

108.8

+0.7

+0.7%

94

97

101

+3

(Based on Financial
Reconstruction Law)

0.39％

0.35%

0.32％

(0.03pt)

Capital adequacy ratio

11.99%

11.72%

11.80%+0.08pt(Billions of yen)

Foreign currency

Number of accounts(10 thousands)

Non-performing assets ratio(domestic criteria)

14.9.30*1◆ Yen deposit balance decreased
from 14.3.31
14 3 31 undernder persistentl
persistently lo
lowinterest rates.

◆ Foreign currency deposit balance
decreased due to an increase in
selling to lock in profits led by yen
depreciation.
◆ Loan balance steadily increased
mainly in mortgage loans.

◆ Number of accounts increased
reflecting
fl ti a new operation
ti byb SonyS
Life’s Lifeplanner sales employees
to handle opening account at Sony
Bank from May 2014.

◆ Sony Bank maintains extremely
low non-performing assets ratio.

*1 Loans in others include corporate loans of ¥103.2 billion*2
2 Balance of problem assets based on the Financial Reconstruction Law / Total credit exposure*3 Please refer to the graph of the non-consolidated capital adequacy ratio (domestic criteria) on P27

Sony Financial Holdings Inc. All Rights Reserved

24Overview of Operating Performance:
Sony Bank (Non-consolidated) (2)<Reference> On Managerial Accounting Basis
FY13.1H

FY14.1H

10 9
10.9

10 6
10.6

(0 3)
(0.3)

(3 3%)(3.3%)

9.1

9.0

(0.0)

(0.9%)

0.4

0.0

(0.4)

(97.5%)

1.3

1.5

+0.2

+15.5%

Gross operating profit (core profit)(A)＝①＋②

9.6

9.0

(0.5)

(5.9%)

Operating expenses and otherexpenses
③

7.2

7.4

+0.1

+2.5%

Net operating profit (core profit)＝(A)－③

2.4

1.6

(0.7)

(31.1%)(Billions of yen)
Gross operating profit
Net interest income*1①

Net fees and commissions*2g income
Net other operating②*3<Reference> Interest Spread(Managerial Accounting Basis)

Change■Managerial accounting basisg adjustmentsjare made to the figuresgon a financial account for p
profits and
The following

Yield on investment

Yield on financing

Interest spread
(%)

1.5
1.20
0.93

1

1.20
(0.02pt)

0.91
0.91

0.5
0.27

0 28
0.28

FY13 1H
FY13.1H

FY14 1H
FY14.1H

losses more appropriately.
*1: Net interest income: Includes profits and losses associated with fund investment recorded in
net other operating income, including gains or losses from currency swap transactions.
*2: Net fees and commissions: Includes profits and losses for customer dealings in foreign
currency transactions recorded in net other operating income.
*3: Net other operating income: After the above adjustments (*1 and *2), consists of profits andlosses for bond and derivative dealing transactions.
■Core profit

0
Note: Interest spread=(Yield on investment)-(Yield on financing)

Profits and losses exclude net other operating income, which includes those on bond andderivative dealing transactions, and stands for Sony Bank’s basic profits.

Sony Financial Holdings Inc. All Rights Reserved

25

Operating Performance:
Sony Bank (Non-consolidated) (1)Loans

Deposits
Yen depositspForeigng currency
y depositspMortgageg g loans

Others(Billions of yen)
1,200(Billions of yen)

2,000

1,092.1

1,057.4
1,857.4

1,890.0

1,824.6(65.3)

340.8

1,000

970.2

+34.6

108.8

*corporate loansof ¥103.2 billion

800

1,500

983.2

600
1,000

400

500

1,483.8200

0013.3.3114.3.3114.9.30

13.3.31Sony Financial Holdings Inc. All Rights Reserved

14.3.3114.9.30

26

Operating Performance:
Sony Bank (Non-consolidated) (2)Non-Consolidated Capital Adequacy Ratio

Balance of Securities by Credit Rating
AAA
BBB

AA
A
Others(Domestic Criteria)(%)
15(Billions of yen)
1,200

11 98
11.98
1,000

908.8
773.8

800

764.7

+0 08pt+0.08pt

11.72

11.80

10

(9.0)
600
5
400

200
0
13.3.31013.3.3114.3.3114.9.30

14.3.3114.9.30*Calculated based on the standard FSA Notification No. 19 (2006), which establishes
standards based on Article 14-2 of the Banking Act of Japan for determining thecapital adequacy of a bank in light of the assets held by the bank.
Sony bank calculates this ratio based on Basel III from March 31, 2014

Sony Financial Holdings Inc. All Rights Reserved27

Consolidated Financial Forecast
for the Year Ending
g March 31,, 2015

Sony Financial Holdings Inc. All Rights Reserved28

Consolidated Financial Forecast
for the Year Ending March 31, 2015
SFH’s consolidated financial forecast for FY2014 is unchanged from the forecast announced
on May 14, 2014, while the forecast of the non-life insurance is revised upward.
((Billions of yen)y )FY2013(Actual)

FY2014(Forecast)

ChangeFY14.1H((Actual))

Progress rate

1,320.4*1

1,191.0(9.8%)

643.0

54.0%

1,196.6

1,061.9(11.3%)

579.4

54.6%

Non-life insurance business

89.8

92.4⇒93.0+2.8%⇒+3.5%

46.4

50.2%⇒49.9%

Banking business

36.4
36
4*1

36 6
36.6

+0 3%
+0.3%

18 6
18.6

51.0%

Consolidated ordinary profit

76.1

77.0

+1.1%

46.9

61.0%

Life insurance business

67.2

67.4

+0.2%

40.1

59.6%

Non-life insurance business3.0

3.9⇒4.5+29.8%⇒+49.8%

3.4

88.1%⇒76.4%

Banking business

5.6

5.3

(6.0%)

3.2

61.7%

40.5

49.0

+21.0%

31.1

63.6%

Consolidated ordinary revenues
Life insurance business

Consolidated net income■ Life Insurance Business
Taking into consideration the market fluctuation risk on and after October 1, 2014, the forecast for ordinary revenues and ordinary profit remains
unchanged even though the results for this first half exceeded our expectations.
■ Non-life Insurance BusinessWe have revised upward our forecast for ordinary revenues because we expect net premiums written in mainstay automobile insurance to continueiincreasing
i steadilyt dil iin th
the second
dh
half.
lf W
We h
have revisedi d upward
d our fforecastt ffor ordinarydiprofitfit bbecause we expectt th
the lloss ratio
ti tot remaini slowlandd stablet bl
in the second half despite a rise in the expense ratio.
■ Banking Business
Taking into consideration the current business performance and the market environment, our forecast for ordinary revenues and ordinary profit remains
unchanged
g even thoughg ordinary
y revenues increased because the rise in bond-dealingg transactions for this first half exceeded our expectations.
p(*) Since the banking business revised its method of recording ordinary revenues and ordinary expenses on hedge transactions for FY14.1H, ordinary revenues for FY13 have been retroactively
adjusted to reflect the change. Consequently, consolidated ordinary revenues and ordinary revenues of the banking business for FY13 have been revised.

Sony Financial Holdings Inc. All Rights Reserved29Sony Life’s MCEV and
Risk Amount Based on Economic Valueas of September 30, 2014

Please keep
p in mind that the validity
y of these calculations of MCEVC
as of SSep.
p 30, 2014,
0 , has not been verified byy outside specialists.
p
A part of the calculations of MCEV as of Sep. 30, 2014, adopted simplified method.

Sony Financial Holdings Inc. All Rights Reserved30Sony Life’s MCEV as of September 30, 2014
(Billions of yen)

14.3.3114.6.30

14.9.30

Change from
14.3.31

Change from
14.6.30

1,221.3

1,260.0

1,313.1

+91.8

+53.1

Adjusted net worth

722.1

758.4

833.4

+111.3+75.1

Value of existing business

499.1

501.7

479.7

(19.5)(22.0)

MCEV(Billions of yen)

New business value

New business margin14.3.3114.6.30

14.9.3055.2 (12M)

16.9 (3M)

30.3 (6M)

5.2%

5.5%

5.1%

Notes:
1. New business margin equals new business value divided by present value of premium income.
2. Calculated MCEV as of Jun. 30, 2014 and Sep. 30, 2014 by using updated economic assumptions and lapse and surrender rate and other assumptions as of Mar. 31, 2014.

 Reasons for changes in MCEV
・MCEV as of Sep.
p 30, 2014 increased ¥53.1 billion from Jun. 30, 2014, due mainly
y to an acquisitionqof new p
policies, a lower inflation rate
and a rise in stock price.
・MCEV as of Sep. 30, 2014 increased ¥91.8 billion from Mar. 31, 2014, due mainly to an acquisition of new policies, yield curve changes
in Japanese yen and a rise in stock price.
 New business value
・New business value as of Sep.
Sep 30,30 2014 was ¥30.3¥30 3 billion (¥60(¥60.6
6 billion / annualized)
annualized), reflecting brisk sales of new policies even in lower
interest rates in Japanese yen.
 New business margin
・New business margin as of Sep. 30, 2014 was down 0.4% from Jun. 30, 2014 due mainly to lower interest rates in Japanese yen.
g as of Sep.
p 30, 2014 remained almost at the same level as on Mar. 31, 2014, mainly
y because the negativeg
impactp・New business marginof lower interest rates in Japanese yen was offset by the positive impact stemming from the absence of the FY13 negative effects; asubstantial increase in sale of lump-sum payment endowment insurance and the strong sale led by the revision of insurance premium
rates on interest rate-sensitive whole life insurance.

Sony Financial Holdings Inc. All Rights Reserved*Please see page 42 for trend on JGB yields.

31Sony Life’s Risk Amount Based on Economic Valueas of September 30, 2014
14.3.31(Billions of yen)

14.6.30

14.9.30

Insurance risk

654.5

663.9

673.3

Market-related risk

240.0

265.0

279.0

Of which, interest rate risk*

180.9

202.8

206.6

Operational risk

26 3
26.3

26 1
26.1

26 4
26.4

Counter party risk

1.3

1.7

1.4

Variance effect(257.8)(269.3)(276.4)

The risk amount based on economic value

664.3

687.3

703.7

(*) Interest amount excluding the variance effect within market-related risk.

(Billi(Billions
off yen))

MCEV

14 3 3114.3.311,221.3

14 6 30
14.6.30
1,260.0

14 9 30
14.9.30
1,313.1

 Maintained capital adequacy by controlling market-related risk.
Notes:
1. The risk amount based on economic value refers to the total amount of Sony Life’s risks, comprehensively examined and including insurance risk andmarket-related risk.
2. The solvency risk capital on an economic value basis is calibrated at VaR (99.5) over one year and based on the internal model, which is a similar but
modified model based on the EU Solvency II (QIS5) standard method.
3. Calculated MCEV as of June 30, 2014 and September 30, 2014 by using updated economic assumptions and lapse and surrender rate and otherp
as of March 31,, 2014.
assumptions

Sony Financial Holdings Inc. All Rights Reserved

32

Appendix

Sony Financial Holdings Inc. All Rights Reserved33

Recent Topics 1
AEGON Sony Life Insurance
Launch of sales: December 1, 2009
Common stock: ¥26 billion (including capital surplus of ¥13 billion)*
Equityy ownership: Sonyy Life insurance Co Ltd 50%, AEGON international B.V. 50%
Marketing products: Individual Variable Annuities
Sales Channels: Lifeplanner sales employees and partner Banks (20*)

SA Reinsurance Ltd
Established： October 29
29, 2009
Common stock: ¥11 billion*
Equity ownership: Sony Life insurance Co., Ltd. 50%, AEGON international B.V. 50%
Business： Reinsurance businessNote) AEGON Sony Life Insurance and SA Reinsurance are equity method companies, 50-50 joint ventures established by Sony Life and AEGON Group.
*As of November 14, 2014

Sony Bank’s Mortgage Loans through Sony Life
■Sony Life accounts for 24% of the balance of mortgage loans as of September 30, 2014
Sony Life accounts for 17% of the amount of new mortgage loans for FY14.1H*Sony Life started handling banking agency business in January 2008.

Sony Assurance’s
Assurance s Auto Insurance Sold by Sony Life
■Sony Life accounts for approx. 5% of new automobile policies for FY14.1H*Sony Life started handling automobile insurance in May 2001.

Sony Financial Holdings Inc. All Rights Reserved34

Recent Topics 2<Highlights for FY2014.2Q>
2014-07-09
2014
07 09

Sony Life closed its representative office in Beijing.

2014-07-28

Sony Life entered into an agreement to acquire Sony Corporation’s headquarters site.

2014 08 01
2014-08-01

S
Sony
Bank
B k enteredt d into
i t tie-upti
withith “S“Sony R
Reall E
Estate”
t t ” iin mortgagetlloans

2014-08-06

Sony Bank started ATM affiliation with Aeon Bank, Ltd.

2014-08-15

Sony BankS
B k started
d offering
ff i interestirates on iits mortgage lloans b
based
d on customers’’
own funds

2014-10-01

Sony Lifecare Group announced the opening of the first newly built nursing care homein Tokyoy in spring,p g 2016

2014-10-02

Sony Life commenced sales of Living Benefit Whole Life Insurance (Living Standard
Type) and Living Standard Special Provision 20142014 11 13
2014-11-13

Sony Assurance announced to launch a PHYD(Pay-How-You-Drive)
PHYD(Pay How You Drive) type of automobile
insurance “Gentle Driving Cash-Back Plan” in Mid-February 2015

Sony Financial Holdings Inc. All Rights Reserved35Sony Life: Fair Value Information on Securities(General Account Assets)
Fair Value Information on Securities
Fair Value Information on Securities(Billions of yen)

Note: Derivative financial products such as principal protected 30 year notes with Nikkei 225 index-linked coupons are included in the “Held-to-maturity-securities” above.
Principal protected 30 year notes with Nikkei 225 index-linked coupons
As of Mar. 31, 2013; Carrying amount: ¥43.3 billion, Fair market value: ¥52.2 billion, Net unrealized gain (losses): ¥8.8 billion
As of Mar. 31, 2014; Carrying amount: ¥43.8 billion, Fair market value: ¥56.0 billion, Net unrealized gain (losses): ¥12.2 billion
As of Sep. 30, 2014; Carrying amount: ¥44.0 billion, Fair market value: ¥57.4 billion, Net unrealized gain (losses): ¥13.3 billion

V l tiValuation
gains
i (losses)(l) on trading-purposet disecurities
iti(Billions of yen)

Notes: Amounts above include those categorized as “monetary trusts.”

Sony Financial Holdings Inc. All Rights Reserved36Sony Life’s Interest Income and Dividends (Details)(Millions of yen)

FY13.1H

FY14.1H

ChangeCash and deposits
Japanese governmentand corporate bonds
Japanese stocks

00+12.2%

47,87452,735+10.2%

198

221+11.7%

Foreign securities

2,868

4,503

+57.0%

Other securities

47

278

+491.1%

Loans

2 820
2,820

2 937
2,937

+4 1%
+4.1%

Real estate

5,145

5,170

+0.5%

17

32

+87.9%

58,97165,879+11.7%

Others
Total

Sony Financial Holdings Inc. All Rights Reserved37Sony Life’s Quarterly Trend on New Policies Amount
Quarterly Trend on New Policy Amount(Billions of yen)

1,201.9

1,200.0

1 238 71,238.7

1,066.5

1,033.3

991.5

947.4

1,000.0

1,135.8

1,128.3

886 2
886.2

841.4
800.0
600 0
600.0
400.0
200.0
0.0
FY12 1Q
FY12.1Q

FY12 2Q
FY12.2Q

FY12 3Q
FY12.3Q

FY12 4Q
FY12.4Q

FY13 1Q
FY13.1Q

FY13 2Q
FY13.2Q

FY13 3Q
FY13.3Q

Sony Financial Holdings Inc. All Rights Reserved

FY13 4Q
FY13.4Q

FY14 1Q
FY14.1Q

FY14 2Q
FY14.2Q

38

Sony Life’s Quarterly Trend on
Annualized Premiums from New Policies
Quarterly Trend on Annualized Premiums from New Policies
Annualized premiums from new policies

Of which, third-sector(Billions of yen)

24 0
24.0

22.0

22.0

19.0

20.0
18.0

17.4

16.0

18.9

18.5

17.2

16 8
16.8
15.2

14.6
13.2

14.0
12.0
10.0
8.0
6.0
4.0

4.4

2.0

50
5.0

52
5.2
3.9

3.6

3.0

3.6

2.9

3.7

FY13.4Q
Q

FY14.1Q
Q

2.8

0.0
Q
FY12.1Q

FY12.2Q
Q

FY12.3Q
Q

FY12.4Q
Q

FY13.1Q
Q

FY13.2Q
Q

FY13.3Q
Q

Sony Financial Holdings Inc. All Rights Reserved

FY14.2Q
Q

39

Method of Measuring Risk Amount
Based on Economic Value (1) Market-related Risk*1

Interest rate risk
Fluctuations in net asset
value based on economic
value in response to theshocks in the right columns.
The same applies below.

Sony Life(Reference) EU Solvency II (QIS5)

Percentage increases or decreases differ for eachcurrency and term
term.
As for measuring interest rate risk in Japanese yen,introduced principal component analysis, where yield
curve changes are disaggregated into threecomponents, parallel shift, twist and butterfly, and theyield curve is shocked by each component
component.

Percentage increases or decreases differ for eachcurrency and term but no lower than 1%(Example)
For Yen 30-year, 30% decrease(Example)
For Yen 30-year, 34% decrease (parallel shift),
28% decrease (twist), 7% decrease (butterfly))

Equity risk

Listed equities 45%, Other securities 70%

Global 30%, Others 40%*2

Real estate risk

Actual real estate 25%

Real estate 25%

Credit risk = (market value) x (risk coefficient for eachcredit rating) x duration

Credit risk

Note that durations have caps and floors, depending
on credit ratings.

Same as on the left

(Example)
Rating A: Risk coefficient (1.4%), cap (23), floor (1)Currency risk

30% downside fluctuation

25% downside fluctuation

Notes
1. Principal
p items as of Sep.
p 30, 2014.
2. Standard risk coefficients are global: 39%/other: 49%. Symmetric adjustment (an adjustment of±10% of the average value of the stock price index during a defined period in
the past) is applied; as of the QIS5 trial introduction (December 31, 2009), these were 30%/40%.

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Method of Measuring Risk Amount
Based on Economic Value (2) Insurance Risk*1

Sony Life(Reference) EU Solvency II (QIS5)

Mortalityy risk

Mortalityy rate increases by
y 15% for each yyear elapsedpSame as on the leftLongevity risk

Mortality rate decreases by 20% for each year
elapsedSame as on the left

Lapse risk

The largest amount of these; *2

The largest amount of these;•Lapse rate increases by 50% for each year elapsed• Increases by 50% in the assumed rates of• Lapse rate decreases by 50% for each year elapsed

lapsation for Life module, 20% for Health module• 30% of policies on which surrender value is in•Decreases by 50% in the assumed rates ofexcess of best estimate liability are immediately
surrendered• 30% of policies (70% for group annuities, etc.) on

lapsation for Life module, 20% for Health module
which surrender value is in excess of best
estimate liability are immediately surrendered

Expense risk

Disability risk

Operating expenses increase by 10% for each year
elapsedRate of inflation rises by 1%

Same as on the left

Rate of occurrence increases by 35% in the first fiscal Rate of occurrence increases by 35% in the firstyear, risingi ibby 25% forf eachh year thereafterthftfi
fiscall year, rising
i i bby 25% forf eachh year thereafter.
thft
Recovery rate decreases by 20%.

Notes
1. Principal items as of Sep. 30, 2014.
2. At Sony Life, lapse risk is calculated by computing and adding together the largest amount of three options for each insurance policy

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JGB Yields

As of the end of each monthSony Financial Holdings Inc. All Rights Reserved

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Contact:
Communications & Investor Relations Department
Sony Financial Holdings Inc.
Inc
TEL： +81-3-5785-1074

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