Tokio Marine : Divestment of Reinsurance Subsidiaries

October 31, 2018

Tokio Marine Holdings, Inc. 1-2-1 Marunouchi, Chiyoda-ku, Tokyo

TSE Code number 8766

Divestment of Reinsurance Subsidiaries

Tokio Marine Holdings, Inc. (President and Group CEO: Tsuyoshi Nagano, "TMHD") announced today that it has entered into a definitive agreement to sell 100% of Tokio Millennium Re AG ("TMR") and Tokio Millennium Re (UK) Limited ("TMR(UK)"), owned by Tokio Marine & Nichido Fire Insurance Co., Ltd. ("TMNF"), a subsidiary of TMHD, to RenaissanceRe Holdings Ltd. ("RenRe").

The transaction will allow Tokio Marine Group to focus on its primary insurance businesses globally, whilst strengthening its relationship with RenRe. The transaction is subject to regulatory approvals in TMR/TMR(UK)'s principal operating locations, with anticipated closing by the end of March 2019.

1. Background

Tokio Marine Group established TMR in 2000 as a subsidiary to write overseas reinsurance risks. Since that time, TMR and TMR(UK) have contributed to Group profits and more recently have broadened the classes of business written into non-catastrophe exposed classes of business. However, the global reinsurance market has recently undergone various changes such as continuing soft market environment driven by steady inflow of capital from outside the reinsurance industry, which has been causing impact on the return earned from the business.

From 2007 onwards, through the significant acquisitions of Kiln, Philadelphia, Delphi and HCC, the Tokio Marine Group has created a diversified global portfolio focusing primarily on specialty insurance classes of business. As a result of this, the contribution of reinsurance business in profit terms to our international operations has reduced significantly from approximately 50% to below 10% in a decade.

Our core strategy is focused on expanding profitable and stable primary insurance business, and as a result we have taken the strategic decision to divest TMR and TMR(UK) as dedicated reinsurance companies.

2. Strategic rationale for the transaction

(1) Strategic optimization of our global portfolio

Through the divestment of the reinsurance activities of TMR and TMR(UK), the Group will reduce volatility in its results and also unlock the capital that was held to support these operations. Our strategic focus will continue to be on primary insurance business in developed countries as well as emerging markets.

(2) Enhanced business relationship with RenRe

RenRe (*1), a specialist reinsurance company headquartered in Bermuda, is well regarded in the broader 1

market, and is a business with which Tokio Marine Group has had a strong relationship over many years. As a result of this transaction, we will further enhance our business relationship with RenRe to the benefit of both parties.

(*1) Overview of RenRe: Established in 1993. Headquartered in Bermuda. Listed on the New York Stock Exchange (market capitalization of US $ 5.38 billion as of the end of September 2018). Operations in 6 countries including Bermuda, US and UK. For details, refer to 4. below.

3. Financial terms and transaction structure

(1) Total consideration and conditions

① Total consideration:

Total consideration represents a multiple of 1.02 times of the total tangible net assets of TMR and TMR(UK). (approximately US $ 1.5 billion (JPY168.5 B) (*2) as of the end of June 2018.) (*3, 4)

② Net Sale Amount is determined by deduction of Pre-closing Dividend (*5) and other miscellaneous deductions from total consideration.

③ Net Sale Amount is combination of cash and shares of RenRe common stock. (*6)

• (*2) Exchange rate: US$=JPY 112.36 (as of October 29,2018)

• (*3) The consideration will be subject to a closing adjustment mechanism.

• (*4) Advisory fees and other transaction expenses for the transaction will be approximately US$20M.

• (*5) Subject to approval by relevant authorities.

• (*6) Expected to be US$250 million with the reference stock price calculated by 30 days volume weighted average price of trading on the New York Stock Exchange ending 5 business days prior to the Closing Date. Transfer of the stock by TMNF is restricted for 12 months.

(2) Appropriateness of total consideration and conditions

Based on various analyses including internal valuation work with relevant available information, Tokio Marine Group believes total consideration and conditions to be fair and reasonable.

4. Schedule

Closing date

March 2019 (planned) (*7)

(*7) The transaction is subject to customary regulatory approvals (principally, the Swiss Financial Market Supervisory Authority and the Prudential Regulation Authority in the UK, as well as a number of other regulators).

5. Impact on our performance

TMHD expects that the impact of the divestment on our financial results will be insignificant.

Appendix

1. About TMR, TMR(UK)

(1) TMR

(1) Name of the company	Tokio Millennium Re AG
(2) Headquarter	Beethovenstrasse 33, 8002 Zurich, Switzerland
(3) CEO	CEO Stephan Ruoff
(4) Main business	Reinsurance
(5) Capital	CHF 227,675K (JPY 26.5B)
(6) Founded	March 15, 2000
(7) Major shareholders	TMNF 100%
(8) Relationship with TMHD	Capital relationship	Wholly owned subsidiary of TMNF
	Personnel relationship	A total of 2 TMHD executive/employee are serving as board members. Also, TMNF are seconding 7 employees.
	Business relationship	TMNF and Group companies have entered into reinsurance and other transactions.
(9) Financial highlights (consolidated basis)
2015		2016	2017
Net asset	$1,205.9M		$1,320.8M	$1,190.6M
Total asset	$3,850.8M		$4,433.3M	$5,059.8M
Net asset per share	$5.30		$5.80	$5.23
Net written premiums	$1,339.3M		$1,317.9M	$1,301.6M
Pre-tax income	$109.1M		$123.4M	▲$161.7M
Net income	$107.8M		$120.7M	▲$158.9M
Net income per share	$0.47		$0.53	▲$0.70
Dividend per share	$0.03		$0.00	$0.00
Combined ratio	92.6%		95.8%	116.2%

(*8) Exchange rate: CHF1=JPY116.22 (as of the end of September 2018)

(2) TMR(UK)

(1) Name of the company	Tokio Millennium Re (UK) Limited
(2) Headquarter	20 Fenchurch Street, London EC3M 3BY, UK
(3) CEO	CEO Mark James Phillip Julian
(4) Main business	Reinsurance runoff
(5) Capital	£125,000K (JPY 18.6B)
(6) Founded	October 30, 1990
(7) Major shareholders	TMNF 100%
(8) Relationship with TMHD	Capital relationship	Wholly owned subsidiary of TMNF
	Personnel relationship	1 TMHD employee is serving as a board member. Also, TMNF are seconding 1 employee.
	Business relationship	TMNF and Group companies have entered into reinsurance and other transactions.

(9) Financial highlights (consolidated basis)
2015	2016	2017
Net asset	£201.6M	£197.3M	£204.5M
Total asset	£561.0M	£496.6M	£431.5M
Net asset per share	£1.61	£1.58	£1.64
Net written premiums	£149.1M	£2.2M	▲£5.4M
Pre-tax income	£0.5M	▲£2.2M	£8.1M
Net income	£0.4M	▲£1.8M	£6.7M
Net income per share	£0.00	▲£0.01	£0.05
Dividend per share	£0.00	£0.00	£0.00
Combined ratio	101.4%	111.5%	177.5%

(*9) Exchange rate: £1=JPY148.53 (as of the end of September 2018)

2. About RenRe

(1) Name of the company	RenaissanceRe Holdings Ltd.
(2) Headquarter	Renaissance House 12 Crow Lane, Pembroke HM19, Bermuda
(3) CEO	President & Chief Executive Officer Kevin O'Donnell
(4) Main business	Holding company of reinsurance companies
(5) Capital	US$440M (JPY 50.0B)
(6) Founded	June 7, 1993
(7) Net asset	US$4,391M
(8) Total asset	US$15,226M
(9) Major shareholders	Vanguard Group 10.26%, BlackRock 10.14%
(10)Relationship with TMHD	Capital relationship	N/A
	Personnel relationship	N/A
	Business relationship	TMNF and RenRe have entered into reinsurance transactions.
	Related parties	N/A

(*10) Exchange rate: US$1=JPY113.57 (as of the end of September 2018)

3. Numbers of shares to be transferred, transferred price and number of shares held before and after transfer

TMR	TMR(UK)
(1) Numbers of shares held before the transfer (*11)	227,675,000 (Voting rights ratio 100.0%)	125,000,000 (Voting rights ratio 100.0%)
(2) Number of shares to be transferred (*11)	227,675,000	125,000,000
(3) Net sale price	See "3. Financial terms and transaction structure" on page 2.
(4) Number of share to be held after transfer	0 (Voting rights ratio 0.0%)	0 (Voting rights ratio 0.0%)

(*11) Shares of TMR and TMR(UK) are owned by TMNF 4