...Moderate Top-Line Growth Expected on Upward Premium Revision All five major Japanese non-life insurers announced higher premiums for their automobile business, resulting from the consumption tax hike (5% to 8%) in April 2014 and rising repair costs. Yet, non-lifers are forecasting slower net premium written growth for the financial year ending March 2015 (FYE15) ¡ 3.0% versus 5.2% in FYE14. Fitch Ratings reiterates that further upward premium revision is crucial to achieve higher underwriting profit. Slower Improvement in Loss Ratio and Combined Ratio The loss ratio, excluding the natural disasters (earned-to-incurred basis), has improved to its lowest in three years, due to strong premium growth as well as lower claims on the auto business line. The "combined ratio" (written-to-paid basis) also improved ¡ to 97.5, below 100% for the first time in six years. However, slower premium growth, the negative impact of the consumption tax hike, and rising repair costs are likely to weigh on the...
