Sompo : Summary of Consolidated Financial Results for the six months ended September 30, 2021 Supplementary Information

UNOFFICIAL TRANSLATION

This document is an unofficial English translation of the Japanese original.

Summary of

Consolidated Financial Results

for the six months ended September 30, 2021

Supplementary Information

November 19, 2021

Sompo Holdings, Inc.

（ Securities Code : 8630 ）

Sompo Holdings, Inc.

1. Overview of Consolidated Financial Results for the six months ended September 30, 2021

（１）Sompo Holdings, Inc.

Overview of Consolidated Financial Results for the six months ended September 30, 2021

(Yen in hundred millions, %)

		Six months ended	Six months ended	Increase	Rate of change
		September 30, 2020	September 30, 2021	(Decrease)
Ordinary income:	(1)	19,853	21,797	1,944	9.8
Net premiums written:	(2)	15,688	17,017	1,329	8.5
Sompo Japan Insurance Inc.	(3)	10,937	11,057	119	1.1
Overseas consolidated subsidiaries	(4)	4,436	5,629	1,193	26.9
Life insurance premiums written	(5)	1,688	1,579	(109)	(6.5)
Ordinary profit:	(6)	775	1,905	1,130	145.9
Sompo Japan Insurance Inc.	(7)	644	878	234	36.4
Net income attributable to shareholders of the	(8)	396	1,307	911	230.0
parent:
Sompo Japan Insurance Inc.	(9)	459	641	181	39.6
Overseas consolidated subsidiaries(Note2)	(10)	64	263	198	307.2
Sompo Himawari Life Insurance, Inc.	(11)	119	100	(18)	(15.6)
Nursing Care & Seniors consolidated	(12)	20	25	4	23.7
subsidiaries(Note3)
Others and consolidation adjustment, etc.(Note1,2)	(13)	(267)	276	544

Notes)

1. "Others and consolidation adjustment, etc." includes profits and losses of consolidated companies other than the above and adjustments due to consolidation adjustments, etc.
2. Sompo International Holdings Ltd. among overseas consolidated subsidiaries has adopted International Financial Reporting Standards and due to differences in accounting standards, 6.6 billion yen is included in the interim result for the six months ended September 30, 2020 and (10.6) billion yen is included in the interim result for the six months ended September 30, 2021 as the amount to be revised in accordance with PITF No.18 "Practical Solution on Unification of Accounting Policies Applied to Foreign
   Subsidiaries, etc. for Consolidated Financial Statements". The same amount is excluded in "Consolidation adjustment, etc.".
3. "Nursing care and healthcare consolidated subsidiaries" has changed its name to "Nursing Care & Seniors consolidated subsidiaries" from the beginning of the fiscal year 2021.
   Financial results of "Nursing Care & Seniors consolidated subsidiaries" in Six months ended September 30, 2020 are figures of "Nursing care and healthcare consolidated subsidiaries".

SOMPO HOLDINGS' numerical management targets

				(Yen in hundred millions)
	Six months ended	Six months ended	Increase		Rate of change
	September 30, 2020	September 30, 2021	(Decrease)
					%
Adjusted consolidated profit	950	1,487	537		56.6

1

Sompo Holdings, Inc.

（２）Sompo Japan Insurance Inc.

Summary of Results of Operations

(Yen in hundred millions)

					Six months ended	Six months ended
					September 30,2020	September 30,2021	Increase	Rate of
					(April 1 to	(April 1 to	(Decrease)	change
					September 30, 2020)	September 30, 2021)
Ordinary income and expenses:					%
	Underwriting income and expenses:(Note)
			Direct premiums written	(1)	12,234	12,291	57	0.5
		(+)	Net premiums written	(2)	10,937	11,057	119	1.1
		(-)	Net claims paid	(3)	5,629	5,820	190	3.4
		(-)	Loss adjustment expenses	(4)	569	574	5	1.0
		(-)	Net operating expenses:	(5)	3,606	3,700	93	2.6
			Net commissions and brokerage fees	(6)	2,104	2,151	46	2.2
			Operating, general and administrative expenses related to underwriting	(7)	1,501	1,549	47	3.1
			Underwriting result	(8)	1,132	961	(170)	(15.1)
		(-)	Change in reserve for outstanding losses and claims	(9)	114	(83)	(198)	(173.2)
		(-)	Change in Ordinary Underwriting Reserves	(10)	342	298	(43)	(12.6)
		(-)	Change in Catastrophic Loss Reserve	(11)	386	346	(40)	(10.4)
		(+)	Other underwriting income and expenses	(12)	54	63	8	15.2
			Underwriting profit	(13)	343	462	119	34.6
	Investment income and expenses:
		(+)	Interest and dividend income	(14)	484	625	141	29.1
		(+)	Transfer of interest and dividend income on deposits of premiums, etc.	(15)	(169)	(152)	17	－
			Net Interest and dividend income	(16)	315	473	158	50.3
		(+)	Gains and losses on sales of securities	(17)	162	39	(123)	(75.8)
		(-)	Impairment losses on securities	(18)	48	21	(27)	(55.7)
		(+)	Gains and losses on derivatives	(19)	(15)	(0)	15	－
		(+)	Other investment income and expenses	(20)	(34)	26	60	－
			Gross investment margin	(21)	378	517	138	36.6
	(+)	Other ordinary income and expenses etc.	(22)	(78)	(101)	(23)	－
			Ordinary profit	(23)	644	878	234	36.4
Extraordinary gains and losses:
		(+)	Extraordinary gains	(24)	10	6	(4)	(38.6)
		(-)	Extraordinary losses	(25)	41	26	(15)	(36.5)
			Extraordinary gains and losses	(26)	(31)	(20)	11	－
			Net income before income taxes	(27)	613	858	245	40.0
(-)	Total income taxes	(28)	153	217	63	41.4
			Net income	(29)	459	641	181	39.6
Ratios:			%	%	%
		Net loss ratio	(30)	56.7	57.8	1.2
		Net operating expenses ratio	(31)	33.0	33.5	0.5
		Combined ratio	(32)	89.6	91.3	1.7

Note) Profit or losses by maturity refunds, etc. of savings-type insurance are not included in underwriting income and expenses.

（３）Overseas consolidated subsidiaries

Summary of Results of Major items

(Yen in hundred millions)

		Six months ended	Six months ended
		September 30,2020	September 30,2021	Increase	Rate of
		(April 1 to	(April 1 to	(Decrease)	change
		September 30, 2020)	September 30, 2021)
					%
Net premiums written	(1)	4,436	5,629	1,193	26.9
Net income attributable to shareholders of the parent	(2)	64	263	198	307.2
The amount to be revised due to differences in accounting standards, which is excluded on	(3)	(66)	106	173	－
consolidation(Note)
Reference: Adjusted net income (loss) attributable to shareholders of the parent (2)+(3)	(4)	(2)	370	372	－
Note)

"The amount to be revised due to differences in accounting standards, which is excluded on consolidation" is the amount stated on page 2 (Note 2).

（４）Sompo Himawari Life Insurance, Inc.

Summary of Results of Major items

(Yen in hundred millions)

		Six months ended	Six months ended
		September 30,2020	September 30,2021	Increase	Rate of
		(April 1 to	(April 1 to	(Decrease)	change
		September 30, 2020)	September 30, 2021)
					%
Insurance premiums and other	(1)	2,153	2,140	(12)	(0.6)
Net premiums written	(2)	1,656	1,547	(109)	(6.6)
Ordinary profit	(3)	187	163	(24)	(12.8)
Net income	(4)	119	100	(18)	(15.6)

2

Sompo Holdings, Inc.

（５）Sompo Japan Insurance Inc.

Summary of Results of Major items

(a) Direct premiums written (excluding deposits of premiums by policyholders)

						(Yen in hundred millions)
	Six months ended September 30, 2020	Six months ended September 30, 2021
	(April 1 to September 30, 2020)		(April 1 to September 30, 2021)
Business line	Amount	Rate of change	Amount		Increase	Rate of change
	(Decrease)
		%				%
Fire and allied insurance	2,396	9.3	2,404		7	0.3
Marine insurance	231	(5.5)	250		19	8.4
Personal accident insurance	863	(7.9)	859		(4)	(0.5)
Voluntary automobile insurance	5,442	0.3	5,453		10	0.2
Compulsory automobile liability insurance	1,169	(22.9)	1,120		(49)	(4.2)
Others	2,131	0.2	2,204		72	3.4
Total	12,234	(1.7)	12,291		57	0.5
Deposits of premiums by policyholders	502	(11.3)	408		(93)	(18.6)

(b) Net premiums written

						(Yen in hundred millions)
	Six months ended September 30, 2020	Six months ended September 30, 2021
	(April 1 to September 30, 2020)		(April 1 to September 30, 2021)
Business line	Amount	Rate of change	Amount		Increase	Rate of change
	(Decrease)
		%				%
Fire and allied insurance	1,516	1.2	1,587		70	4.7
Marine insurance	208	(13.8)	255		46	22.5
Personal accident insurance	826	(9.6)	831		5	0.6
Voluntary automobile insurance	5,412	0.1	5,427		15	0.3
Compulsory automobile liability insurance	1,232	(15.4)	1,142		(89)	(7.2)
Others	1,743	(1.3)	1,812		69	4.0
Total	10,937	(3.0)	11,057		119	1.1
Excluding earthquake insurance and	9,704	(1.2)	9,912		208	2.2
compulsory automobile liability insurance

(c) Net claims paid

(Yen in hundred millions)

	Six months ended September 30, 2020		Six months ended September 30, 2021
	(April 1 to September 30, 2020)		(April 1 to September 30, 2021)
	Amount	Net loss ratio	Amount	Increase	Net loss ratio
Business line	(Decrease)	Increase
				(Decrease)
		%			%	%
Fire and allied insurance	1,002	68.4	1,143	141	74.6	6.2
Marine insurance	121	61.4	116	(5)	47.7	(13.7)
Personal accident insurance	354	46.7	345	(9)	45.4	(1.3)
Voluntary automobile insurance	2,516	53.2	2,602	85	54.6	1.4
Compulsory automobile liability insurance	810	72.6	779	(31)	75.3	2.7
Others	824	50.1	833	9	48.8	(1.3)
Total	5,629	56.7	5,820	190	57.8	1.2
Excluding earthquake insurance and	4,819	54.7	5,019	200	55.6	0.9
compulsory automobile liability insurance

(d) Net Incurred Loss during the period due to Natural Disasters in Japan

								(Yen in hundred millions)
	Six months ended September 30, 2020		Six months ended September 30, 2021
	(April 1 to September 30, 2020)		(April 1 to September 30, 2021)
			Reserve for				Reserve for
	Net claims paid		outstanding	Net incurred loss	Net claims paid	outstanding		Net incurred loss
Business line		losses and	losses and
			claims				claims
Fire and allied insurance	140		265		405	53	187		241
Voluntary automobile insurance	35		(2)		33	14	2		16
Other than the above	9		6		16	2	4		7
Total excluding earthquake insurance and	185		269		455	69	195		265
compulsory automobile liability insurance
Note) Net incurred loss ＝ Net claims paid ＋ Reserve for outstanding losses and claims

Reserve for outstanding losses and claims represents amounts deducting reinsurance recoverable on unpaid loss from reserve for outstanding losses and claims of direct insurance and assumed reinsurance.

3

Sompo Holdings, Inc.

(e) Breakdown of Operating, General and Administrative Expenses and Loss Adjustment Expenses

(Yen in hundred millions)

	Six months ended September 30, 2020	Six months ended September 30, 2021
	(April 1 to September 30, 2020)	(April 1 to September 30, 2021)
Business line	Amount	Increase	Rate of	Amount	Increase	Rate of
(Decrease)	change	(Decrease)	change
			%			%
Personnel expenses	1,087	(49)	(4.4)	1,055	(32)	(3.0)
Non-personnel expenses	957	22	2.4	1,043	86	9.0
Others (taxes and contributions)	109	(1)	(1.0)	118	9	9.0
Total	2,153	(28)	(1.3)	2,218	64	3.0

(f) Reserve for Outstanding Losses and Claims

						(Yen in hundred millions)
	Six months ended September 30, 2020		Six months ended September 30, 2021
Business line	Balance		Change		Balance		Change
Fire and allied insurance		1,227		141	1,334		(89)
Marine insurance		218		(6)	218		3
Personal accident insurance		476		(62)	447		(0)
Voluntary automobile insurance		3,761		(20)	3,695		(16)
Compulsory automobile liability insurance		739		51	640		14
Others		2,281		10	2,304		4
Total		8,705		114	8,640		(83)

(g) Ordinary Underwriting Reserves

						(Yen in hundred millions)
		Six months ended September 30, 2020		Six months ended September 30, 2021
Business line		Balance	Change		Balance		Change
Fire and allied insurance		7,733		130	7,830		78
Marine insurance		178		(37)	190		(9)
Personal accident insurance		1,355		81	1,355		81
Voluntary automobile insurance		3,192		(1)	3,188		(15)
Compulsory automobile liability insurance		4,653		22	4,620		0
Others		3,613		145	3,624		163
Total		20,726		342	20,810		298
Note) This table excludes reserve for maturity refunds and reserve for dividends to policyholders of savings-type insurance and includes underwriting reserves of earthquake
insurance and compulsory automobile liability insurance.

(h) Catastrophic Loss Reserve

							(Yen in hundred millions)
	Six months ended September 30, 2020	Six months ended September 30, 2021
	Reversal	Provision	Balance	Balance	Reversal	Provision		Balance	Balance
Business line	ratio		ratio
				%					%
Fire and allied insurance	157	280	1,191	39.3	201	292		1,128	35.6
Marine insurance	0	6	446	107.2	－	7		448	88.0
Personal accident insurance	－	26	741	44.9	－	26		790	47.6
Voluntary automobile insurance	－	175	533	4.9	－	176		887	8.2
Others	0	56	2,053	58.9	14	59		2,032	56.1
Total	159	546	4,965	25.6	215	562		5,286	26.7

Note) Balance ratio = Balance of catastrophic loss reserve / { Net premiums written (excluding earthquake insurance and compulsory automobile liability insurance) × 2 ｝ × 100

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