Sumitomo Life expects insurance premium income to rise 3.7% to US$24.6 billion (JPY3.9 trillion) in fiscal year 2026 (FY 2026), whilst group core profit is projected to increase 2.9% to $2.6 billion (JPY420 billion).
CreditSights said gains from a wider investment spread are expected to support earnings, although inflation-driven cost pressures and ongoing growth investments are likely to limit profit growth.
In FY 2025, consolidated insurance premium income rose 10.5% year-on-year to $23.7 billion (JPY3.76 trillion). Domestic premiums increased 8.2% to $14.5 billion (JPY2.30 trillion), whilst overseas premiums grew 13.2% to $7.9 billion (JPY1.26 trillion), supported by subsidiaries Symetra and Singlife.
Group core profit increased 2.8% to $2.6 billion (JPY408.1 billion). CreditSights noted that profit growth would have been 15% on an underlying basis if not for higher reserves linked to rapid growth in single-premium whole life products.
The insurer also benefited from an improved investment spread, which widened to 90 basis points from 59 basis points a year earlier as the basic yield rose to 2.75%.
CreditSights said Sumitomo Life's investment portfolio repositioning was evident in FY25, with losses from domestic bond sales increasing to $2.3 billion (JPY372 billion) from $388.7 million (JPY61.7 billion) a year earlier.
These losses were partly offset by $1.8 billion (JPY290.2 billion) in gains from equity sales, reported Insurance Asia.