MS& Insurance : Medium-term Management Plan (FY2022-2025)

MS&AD Group

Medium-term Management Plan (FY2022-2025)

Grow Together with Society As a Platform Provider of Risk Solutions

I. Review of Previous Medium-termManagement Plan

"Vision 2021"

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I. Review of Previous Medium-term Management Plan "Vision 2021":

(1) Quantitative Targets

• We achieve our target of Group Adjusted Profit of JPY 300 billion whilst maintaining a business scale which puts us within the top 10 non-life insurance groups in the world.
• ESR is 228%, which exceeds the target range (180-220%).
• Group Adjusted ROE rose to 9.5% but fell short of the target level (10%), and this is still an issue that needs to be addressed.

Group Adjusted Profit and Group Adjusted ROE

(JPY 100 mil)	Group Adjusted Profit	Group Adjusted ROE	9.5%
4,000				10.0%
3,500					9.0%
3,000		7.4%	6.7%		8.0%
		3,471	7.0%
6.4%	6.1%
2,500
				6.0%
2,000		2,331	2,146		5.0%
2,010	1,898				4.0%
1,500
1,000					3.0%
				2.0%
500					1.0%
0					0.0%
FY2017	FY2018	FY2019	FY2020	FY2021

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I. Review of Previous Medium-term Management Plan "Vision 2021":

(2) Qualitative Targets

• We focused on the three priority issues whilst building systems for anticipating changes in the environment and swiftly responding to any change, including the acceleration of digitalization, the advent of next-generation mobility, the materialization of new risks, and initiatives to address sustainability issues.

Pursue the Group's Comprehensive Strengths

"Utilize/Extend/Increase"

"Stop/Eliminate/Reduce"

Standardization of products

Project

Project

and administrative tasks

Joint implementation of

Sale of MSP Life products

Expansion of life insurance and

Launch of a

non-life insurance products

impact investment aimed at

through MSA Life

new claim handling system

cross-selling ratio

contributing to the SDGs

distribution channels

18% (Forecast)

Phased in from July 2021

December 2021

Launched October 2019

(Almost achieved target of 18.5%)

Industry-leading level growth

Reductions to operating expenses

• Achieved industry-leading level growth rate for domestic gross written premiums.*

• Reductions to operating expenses far exceeded initial target (JPY 30 billion), with cost reduction of approx. JPY 53 billion by FY2021 compared with FY2019 levels.
• Implementing initiatives to achieve planned reduction of approx. JPY 100 billion by FY2025.

	31,217	(Unit: JPY 100 mil)		1,000	(Unit: JPY 100 mil)
28,763		530
2017	2021	(FY)	2021	2025	(FY)
				Forecast

* Simple sums of non-consolidated figures for MSI and ADI. Excluding policyholder premium deposits.

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I. Review of Previous Medium-term Management Plan "Vision 2021":

(2) Qualitative Targets

Promote Digitalization

Progress on three initiatives (DX, DI, DG)

Digitalization of key services and business operations

• Introduction of the AI-integrated agency system (MS1 Brain)
• Launch of new claim handling system (BRIDGE), AI accident situation explanation system, and AI-based fraudulent claims detection system
• Automation of internal business processes utilizing process automation tools

Launch new businesses by utilizing digital technologies

• Consulting that utilizes data (RisTech)
• Digitalization of insurance sales through built-in insurance in collaboration with platformers and small-amount and short-term insurance, etc.

Global expansion

• Asia expansion of MS1 Brain
• Establishment of corporate venture capital in Silicon Valley and investment in 65 companies in 8 countries
• Business investment in overseas InsurTech companies
• Telematics data business in the US, etc.

Rollout of the CSV×DX strategy

Develop new businesses that solve social issues

MS&AD's strengths

Diverse needs,

data and deployment Transforming products and services

capabilities

Transforming

＋sales channels and sales techniques

CSV × DX	Creating new
	businesses

Examples of implementation

• Providing livestock breeders with insurance covering cattle medical expenses using sensors
• Providing disaster prevention information with the cmap real-time disaster prediction site
• Providing AI-based road inspection service to local governments

Other initiatives

Digital human resource development through coordination between industry and academia

Trained approx. 2,000

Group employees in total

Implementation of "Digital Innovation Challenge Program,"	Selection as:
a business idea contest for all Group employees	 2019 Competitive IT Strategy Company
Total number of entries: 5,500 over 3 years	 Noteworthy DX Company 2020
 DX Stock 2021

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