May 15, 2017
Sony Financial Holdings Inc.

Summary Information on Sony Assurance’s Financial Results
for the Year Ended March 31, 2017
<Contents>
1. Balance Sheets

P.2

2. Statements of Income

P.4

3. Financial Summary (Year-on-Year Comparison)

P.5

4. Premiums and Losses Paid by Type of Policy

P.7

5. Risk-monitored Loans

P.7

6. Securities

P.8

7. Non-consolidated Solvency Margin Ratio

P.911. Balance Sheets(Millions of yen)
As of March 31, 2016

As of March 31, 2017

Assets:Cash and deposits

8,381

8,951

00Deposits

8,381

8,951

Securities

127,256137,553

Japanese government bonds

82,42784,455

Japanese local government bonds

27,20729,308Japanese corporate bonds

12,66021,544

Japanese stocks

3,708

2,046

Foreign securities

197

197

Other securities

1,055

Tangible fixed assets

4,024

3,399

Buildings

201

188

Construction in progress

181

22

Other tangible fixed assets

3,641

3,188

5,988

6,529

Software

3,347

5,833

Software in progress

2,640

144

0

550

20,36322,125

Accrued premiums

1,273

1,270

Due from reinsurers

96

36

Due from foreign reinsurers

48

13,49315,097

Accrued income

152

149

Money on deposits

443

506

Suspense payments

4,900

5,056

6,308

7,978

172,323

186,537

Cash

Intangible fixed assets

Other intangible fixed assets
Other assets

Accounts receivable

Deferred tax assets
Total Assets2-

(Millions of yen)
As of March 31, 2016

As of March 31, 2017

Liabilities:
Underwriting reserves

133,246

144,514

Reserve for outstanding losses and claims

37,542

38,340Underwriting reserves

95,704

106,173

8,339

9,877

Other liabilities
Due to reinsurers-

Due to foreign reinsurers

68

55

1,442

1,746

Deposits received

1565

Accounts payable2,724

3,021

Suspense receipt

4,152

4,969

Reserve for employees’ retirement benefits

1,281

1,440

Reserve for directors’ retirement benefits

4436

Reserve for employees’ bonuses

956

1,082

Reserve under the special laws

149

177

Reserve for price fluctuations

149

177

144,018

157,128

20,00020,000Capital reserve

3,389

3,389

Total capital surplus

3,389

3,389

Income taxes payable

Total Liabilities
Net Assets:
Shareholders’ equity
Common stock
Capital surplus

Retained earnings
Earned reserve-258

Other retained earnings

2,586

4,549

Unappropriated retained earnings

2,586

4,549

Total retained earnings

2,586

4,808

Total shareholders’ equity

25,97628,197Net unrealized gains (losses) on other securities,
net of taxes

2,328

1,211

Total valuation and translation adjustments

2,328

1,211

28,30529,409172,323

186,537

Valuation and translation adjustments

Total Net Assets
Total Liabilities and Net Assets

32. Statements of Income(Millions of yen)
For the year ended
March 31, 2016

For the year ended
March 31, 2017

96,905102,333

95,612

100,330

95,549100,274(Interest and dividends on deposits of premiums)

6255(Other underwriting income)0

Ordinary Revenues
Underwriting income(Net premiums written)

Investment income(Interest income and dividends)(Gains on sale of securities)

-

1,263

1,957

1,313

1,327

12685

(Gains on redemption of securities)

-

0(62)

(55)

2945

92,22597,336

Underwriting expenses

67,79870,553(Net losses paid)

48,11150,181(Loss adjustment expenses)

7,098

7,458

(Net commissions and brokerage fees)

1,515

1,646

(Provision for reserve for outstanding losses and claims)

1,877

798

(Provision for underwriting reserves)

9,195

10,469(Transfer to interest and dividends on deposits of premiums)
Other ordinary income
Ordinary Expenses(Other underwriting expenses)

0

Investment expenses(Losses on sale of securities)
Operating, general and administrative expenses
Other ordinary expenses
Ordinary Profit-

40

40

24,41826,763

319

4,680

4,996

Extraordinary Gains-

Extraordinary Losses

-

890

47

Losses on sale or disposal of fixed assets

864

19

Provision for reserve under the special laws

2527

Provision for reserve for price fluctuations

2527

Income Before Income Taxes

3,790

4,949

Income Taxes –Current

2,417

2,669

Income Taxes –Deferred(1,213)(1,235)

Total Income Taxes

1,203

1,434

Net Income

2,586

3,515

4

3. Financial Summary (Year-on-Year Comparison)(Millions of yen)
For the year
ended
March 31, 2016

For the year
ended
March 31, 2017

Change(Amount)

Gross direct premiums written

94,336

99,014

4,678

5.0 %

(Direct premiums written)

94,336

99,0144,678

5.0

95,612

100,330

4,717

4.9

95,549100,274

4,724

4.9

Underwriting expenses

67,79870,5532,7554.1(Net losses paid)

48,11150,181

2,070

4.3(Loss adjustment expenses)

7,098

7,458

359

5.1

(Net commissions and brokerage fees)

1,515

1,646

130

8.6

1,263

1,957

693

54.9

1,313

1,327

13

1.0

12

685

672

5,332.340(4)(92.6)

40(4)(92.6)

Operating, general and administrative expenses

24,41826,763

2,344

9.6(Operating, general and administrative
expenses related to underwriting)

24,347

26,706

2,359

9.7

25

26

0

0.3

4,680

4,996

316

6.8

3,470

3,070

(400)

(11.5)--

Underwriting income(Net premiums written)

Ordinary Income (expenses)

Investment income(Interest income and dividends)(Gains on sale of securities)
Investment expenses(Losses on sale of securities)

Other ordinary income, net
Ordinary profit(Underwriting profit)
Extraordinarygains (losses)

Extraordinary Gains--Change(%)

890

47

(843)

(94.7)

Extraordinary gains (losses), net

(890)

(47)

843

-

Income Before Income Taxes

3,790

4,949

1,159

30.6

Income Taxes - Current

2,417

2,669

252

10.4

Income Taxes - Deferred(1,213)(1,235)(21)

Total Income Taxes

1,203

1,434

230

19.2

Net Income

2,586

3,515928

35.9

Net loss ratio

57.8%

57.5%

Net expense ratio

27.1%

28.3%

Yield on investments (income basis)

1.03%

0.95%

Yield on investments (realized basis)

1.03%

1.44%

RatiosExtraordinary Losses-(Reference)
Yield on investments (market value basis) : 2.05% for the year ended March 31, 2016 and 0.32% for the year ended March 31, 2017.
Notes:
1. Underwriting profit = Underwriting income – (Underwriting expenses + Operating, general and administrative expenses
related to underwriting) ± Other income (expenses). Other income (expenses) is the amount equivalent to the corporate
income taxes for compulsory automobile liability insurance, etc.
2. Calculation method for yield on investments is described in separate attachments.
5

Attachment

Calculation method for yield on investments
1. Yield on investments (income basis)
The results of investment in assets are indicated as income revenues (interest income and dividends).
Interest income and dividends on investment assets is the numerator, and acquisition cost is the denominator.
• Numerator: Interest income and dividends• Denominator: Average balance of either acquisition cost or amortized cost
2. Yield on investments (realized basis)
The results of investment in assets are indicated as the contribution to net income (loss) for the period(statements of income).
Realized profit and loss is the numerator, and acquisition cost is the denominator.
• Numerator: Investment income + Interest and dividends on deposits of premiums – Investment expenses• Denominator: Average balance of either acquisition cost or amortized cost
3. (Reference) Yield on investments (market value basis)
An indicator of investment efficiency based on market value. Realized profit and loss plus net unrealized gains is
the numerator, and market value is the denominator.
• Numerator = (Investment income + Interest and dividends on deposits of premiums – Investment expenses)+ (Net unrealized gains at end of period* – Net unrealized gains at end of previous period*)• Denominator =Average balance according to the acquisition cost or amortized cost
+ Net unrealized gains on other securities at end of previous period**Amounts before tax deductions

6

4. Premiums and Losses Paid by Type of Policy(Millions of yen)

Direct Premiums Written

For the year ended
March 31, 2017

For the year ended
March 31, 2016
AmountFire348

Composition

YoY Change%%

Marine

0.4-

4.6
-

Amount245-

Composition

YoY Change%%

0.2-(29.6)--

Personal accident

8,679

9.2

1.2

8,767

8.9

1.0

Voluntary automobile

85,30890.4

4.6

90,001

90.9

5.5

Compulsory automobile liability
Total

94,336-

-

100.0

-

4.2

99,014-

-

100.0

5.0
(Millions of yen)

Net Premiums Written

For the year ended
March 31, 2017

For the year ended
March 31, 2016
AmountComposition

YoY Change%%AmountComposition

YoY Change%%

Fire

440.0(2.8)

240.0(43.9)

Marine440.0(59.7)(2)(0.0)(105.5)

Personal accident

8,953

9.4

1.2

9,044

9.0

1.0

Voluntary automobile

85,12389.1

4.6

89,746

89.5

5.4

Compulsory automobile liability

1,384

1.4

3.6

1,460

1.5

5.5

95,549100.0

4.2

100,274

100.0

4.9

Total

(Millions of yen)

Net Losses Paid
For the year ended
March 31, 2016
Amount

For the year ended
March 31, 2017

YoY Change

Net loss ratio%%

AmountYoY Change

Net loss ratio%%

Fire1(46.1)

65.7

6

298.1

Marine46(48.9)

103.7

(6)

(114.9)Personal accident

2,472

9.1

30.5

2,615

5.8

32.0

Voluntary automobile

44,3204.5

60.1

46,263

4.4

59.5

Compulsory automobile liability
Total

117.5
-

1,270

4.8

91.8

1,301

2.5

89.1

48,111

4.6

57.8

50,181

4.3

57.5

5. Risk-monitored Loans
Not appricable76. Securities(1) Trading-purpose Securities
None(Millions of yen)(2) Held-to-maturity Securities
As of March 31, 2016

Fair value is higher thanbalance sheet amount

Fair value is lower thanbalance sheet amount

Balance sheet
amountFair value

Japanese bonds(including JGBs)

71,050Foreign securities
Subtotal
Japanese bonds(including JGBs)

Difference

Fair value

Difference

92,796

21,74571,76587,81016,045

197

221

23

197

215

18

71,24893,017

21,76971,962

88,026

16,063

3,873

3,424

(449)

Foreign securities
SubtotalTotal(3) Available-for-sale Securities

Japanese bonds(including JGBs)

Balance sheet amount ishigher than acquisition cost Japanese stock

Subtotal
Japanese bonds(including JGBs)

As of March 31, 2017
Balance sheet
amount------

71,24893,017

21,7693,873
75,836

3,424
91,451(449)
15,614(Millions of yen)
As of March 31, 2017
As of March 31, 2016
Balance sheet Acquisition
Balance sheet Acquisition
Difference
Difference
amountamountcost
cost
45,05444,787266

45,082

44,900

181

3,708

729

2,978

2,046

529

1,517

48,76245,517

3,245

47,12945,4301,698

14,587

14,603

(15)

6,190

6,201(10)Balance sheet amount islower than acquisition cost Others

1,055

1,055-

Subtotal
Total

7,245
56,008

7,256
52,774(10)3,234(4) Available-for-sale Securities Sold during the Fiscal YearFor the year ended March 31, 2016

Japanese bonds (including JGBs)
Japanese stocks
Total-

14,58761,716

14,60360,033(15)
1,683(Millions of yen)
For the year ended March 31, 2017

Amount ofsales

Total gains
on salesTotal losses
on salesAmount ofsales

Total gains
on salesTotal losses
on sales

9,480

124
46679
685

012

1,885
9372,823

9,480

80

7. Non-consolidated Solvency Margin Ratio(Millions of yen)
As of March 31, 2016
(A) Total non-consolidated solvency margin
Capital or treasury, etc.
Reserve for price fluctuations

As of March 31, 2017

42,701

46,724

24,682

26,439149

177

Contingency reserve

91

101

Catastrophe reserve

14,363

17,542

General reserve for possible loan losses-

Net unrealized gains on other securities and net deferred gains (losses) on
hedging instruments (before tax deductions)

-

2,910

1,514

Net unrealized gains on real estate--

Excess refund reserve--

Subordinated debt--

The portion of the excess refund reserve and subordinated debt that is notincluded in the margin--

Deductible items-Others(B) Total non-consolidated risk
Ordinary insurance risk

(R1+R2)2+(R3+R4)2+R5+R6
(R1)

-

502

948

12,313

12,786

10,906

11,370Third-sector insurance risk

(R2)

-

Assumed interest rate risk

(R3)

96

105

Asset management risk

(R4)

1,416

1,431

Business management risk

(R5)

269

278

Major catastrophe risk(C) Non-consolidated solvency margin ratio[(A)／{(B)×1/2}]×100

(R6)

1,033

1,033

693.5 %

730.8 %

Note:

-The above figures were calculated based on the provisions in Articles 86 and 87 of the Ordinance for Enforcement of the Insurance Business Act of Japanand the Ministry of Finance Public Notice No. 50 of 1996.

<Non-consolidated Solvency Margin Ratio>
Non-life insurance companies maintain reserves to ensure their ability to pay claims when accidents occur and return contracted amounts
at maturity on savings-type insurance. Non-life insurance companies must also maintain sufficient ability to cover against risk events
which exceed its normal estimates, i.e. occurrence of a major catastrophe or a dramatic drop in the value of the assets they hold.
Total risk (item (B) in the table) indicates risk events which exceed the normal estimates.
The non-consolidated solvency margin ratio (item (C) in the table) is an indicator of an insurer’s ability to pay, calculated as prescribedby the Insurance Business Act of Japan, based on its percentage holdings of capital and other reserves (in other words, the totalnon-consolidated solvency margin, as indicated by (A)).
“Risk events which exceed the normal estimates” refers to the total of the amounts represented by the following risks:(1) Insurance underwriting risk
: Risk which exceeds the normal estimates for the rate of accident occurrence(Ordinary insurance risk)(excluding major catastrophe risk)(Third-sector insurance risk)(2) Assumed interest rate risk
: Risk that actual investment yields will fall below
the investment yield assumed when calculating premiums(3) Asset management risk
: Risk arising from such factors as unexpectedly large fluctuations in prices
on held securities and other assets(4) Business management risk
: Unexpected risk to business management other than (1) through (3) above and (5)(5) Major catastrophe risk

: Risk arising from major catastrophes(such as the Great Kanto Earthquake and the Ise Bay Typhoon)

A non-life insurer’s ability to pay (total non-consolidated solvency margin), as indicated by such factors as its capital and reserves,is the total of the insurer’s net assets (excluding the amount of expected outflow from the company), reserves (such as the reservefor price fluctuations and catastrophe reserve) and a portion of its net unrealized gains on real estate.
The non-consolidated solvency margin ratio is one of the objective indicators used by the insurance regulatory authorities to supervise insurers.
When this ratio is 200% or higher, an insurer is judged to have sufficient ability to satisfy claims and other payments.
9