AM Best has affirmed the Financial Strength Rating of A+ (Superior) and the Long-Term Issuer Credit Rating of “aa-” (Superior) of Meiji Yasuda Life Insurance Company (Meiji Yasuda) (Japan). The outlook of these Credit Ratings (ratings) is stable.

The ratings reflect Meiji Yasuda’s balance sheet strength, which AM Best assesses as strongest, as well as its strong operating performance, favourable business profile and appropriate enterprise risk management.

Meiji Yasuda’s balance sheet strength assessment is underpinned by its risk-adjusted capitalisation at the strongest level, as measured by Best’s Capital Adequacy Ratio (BCAR), and is supported further by its solid capital base and conservative financial leverage. Following market-driven fluctuations in unrealised gains on securities, the company’s absolute capital retreated from its peak of JPY 5.8 trillion between March 2024 and March 2025, though it has since recovered by September 2025. Meiji Yasuda’s substantial equity holdings continue to present a degree of equity risk; however, the company possesses ample capital buffers to absorb such risks. Capital management is conducted through a disciplined framework incorporating economic-based metrics such as the economic solvency ratio and group surplus, complemented by a sound asset-liability management strategy.

In fiscal year ended 31 March 2025 (fiscal year 2024), Meiji Yasuda delivered a strong and resilient operating performance, with consolidated insurance premiums of JPY 3.4 trillion and a base profit of JPY 626 billion. This performance was supported by higher investment-related gains and stronger contribution from its overseas operations, particularly its key U.S. subsidiary, StanCorp Financial Group, Inc. (StanCorp). Despite stagnant domestic market growth and financial market volatility in recent years, Meiji Yasuda has maintained stable return on equity historically over the past decade. In the first half of fiscal year 2025, the company’s consolidated premiums increased by 31% year-on-year to JPY 2.4 trillion, driven by a rebound in domestic single premium product sales, while net operating profit rose by 5.7% to JPY 330 billion. Over the long term, while foreign exchange volatility and inflation could pose potential headwinds, AM Best expects Meiji Yasuda’s stable in-force book of business, together with a gradually improving domestic interest rate environment and growing overseas contributions, positions the company to generate solid and sustainable operating profits.

Meiji Yasuda continues to be one of Japan’s largest private life insurance companies and maintains a leading position in the domestic group insurance segment. The company’s ongoing efforts to improve the quality and productivity of agency channel and strong sales of bancassurance channel continues to support revenue growth and its position in the domestic market in recent years. The contribution of its overseas operations has continued to increase, reaching approximately 19% of its premium income in fiscal year 2024. Recent overseas acquisitions and strategic initiatives, including the expansion of StanCorp’s U.S. group insurance platform and the announced acquisition of the U.S. entities of Legal & General Group, are expected to support the group’s long-term overseas business development and profit growth target.

Negative rating actions also could occur if there is material and prolonged deterioration in the company’s operating performance caused by a sustained declining trend in premium income and/or operating profit. Negative rating actions could occur if there is material deterioration in Meiji Yasuda’s balance sheet strength fundamental, for example, material reduction in risk-adjusted capitalisation driven by a substantial increase in investment risk. Positive rating actions could occur if Meiji Yasuda demonstrates sustained improvement in its balance sheet strength metrics although the likelihood of such actions remains limited at this time.

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