Auto: A Quarter of the Market and Three Rate RisesNarrow moat

Tokio Marine Holdings (8766) — moat facet

Tokio Marine's largest line broke even at best last year, and it is raising prices by double digits to fix it.

Auto is the largest part of Japanese non-life insurance and of Tokio Marine & Nichido's business: premiums of ¥1,232.1 billion in the latest year1, and a market share of 26.3%2. Its auto combined ratio was 100.8% in the year to March 2025 and 98.5% in 20263, near or above break-even.

Auto combined ratio (%, years to March)84.2202193.52023100.8202598.5202694.92027 planTokio Marine IR conference, May 2026
From 84% to above 100%, and a plan to reverse it.

The cause was claims inflation: repair costs and parts rose faster than premiums. The response has been price increases: +3.5% in January 2025, +8.5% in October 2025 and a further +6.5% scheduled for October 20264. In the first quarter of the current year the unit price of claims rose 7.5% while their frequency was unchanged5.

The company plans an auto combined ratio of 94.9% for the current year6. Rate increases take a year or more to reach the books, because policies renew annually.

The auto combined ratio was as low as 84.2% in the year to March 20217. It rose every year after that, to 100.8% four years later8. The first quarter of the current year showed claim frequency unchanged and unit costs up 7.5%9.

The measure is the auto combined ratio. Reaching 94.9% would show the price increases catching up with claims.

Moat trajectory: Holding steady

Rate increases are reaching the books.

The number that tests this moat
Reported
Auto combined ratio, latest year
98.5% (100.8% a year earlier, plan 94.9%)

The largest line's profitability; the rate increases should bring it down.

Source: Tokio Marine IR conference, May 2026 ↗
⚠ Threats to the moat
⚠ THREAT 01
Claims Rise Faster Than Rates
Tokio Marine's auto claims are rising 7.5% a year, about as fast as it can raise prices.
References
  1. ReportedAuto is the largest part of Japanese non-life insurance and of Tokio Marine & Nichido's business: premiums of ¥1,232.1 billion in the latest year, and a market share of 26.3%.
    Tokio Marine Holdings, FY2025 results and FY2026 projections presentation - Japan P&C results: premiums, auto, natural catastrophes and expense ratios. — FY to March 2026 · publ. May 2026 · source ↗
  2. ReportedAuto is the largest part of Japanese non-life insurance and of Tokio Marine & Nichido's business: premiums of ¥1,232.1 billion in the latest year, and a market share of 26.3%.
    Tokio Marine Holdings, Group Business Strategy IR conference, 26 May 2026 - Japan P&C: market share, combined ratios, auto insurance, premiums, sales channels and the regulatory orders. — 2016-2026 · publ. 26 May 2026 · source ↗
  3. ReportedIts auto combined ratio was 100.8% in the year to March 2025 and 98.5% in 2026, near or above break-even.
    Tokio Marine Holdings, Group Business Strategy IR conference, 26 May 2026 - Japan P&C: market share, combined ratios, auto insurance, premiums, sales channels and the regulatory orders. — 2016-2026 · publ. 26 May 2026 · source ↗
  4. ReportedThe response has been price increases: +3.5% in January 2025, +8.5% in October 2025 and a further +6.5% scheduled for October 2026.
    Tokio Marine Holdings, Group Business Strategy IR conference, 26 May 2026 - Japan P&C: market share, combined ratios, auto insurance, premiums, sales channels and the regulatory orders. — 2016-2026 · publ. 26 May 2026 · source ↗
  5. ReportedIn the first quarter of the current year the unit price of claims rose 7.5% while their frequency was unchanged.
    Tokio Marine Holdings, overview of first-quarter FY2026 results - progress against the plan, large losses, the Middle East, strategic equity sales and natural catastrophes. — April-June 2026 · publ. August 2026 · source ↗
  6. ReportedThe company plans an auto combined ratio of 94.9% for the current year.
    Tokio Marine Holdings, Group Business Strategy IR conference, 26 May 2026 - Japan P&C: market share, combined ratios, auto insurance, premiums, sales channels and the regulatory orders. — 2016-2026 · publ. 26 May 2026 · source ↗
  7. ReportedThe auto combined ratio was as low as 84.2% in the year to March 2021.
    Tokio Marine Holdings, Group Business Strategy IR conference, 26 May 2026 - Japan P&C: market share, combined ratios, auto insurance, premiums, sales channels and the regulatory orders. — 2016-2026 · publ. 26 May 2026 · source ↗
  8. ReportedIt rose every year after that, to 100.8% four years later.
    Tokio Marine Holdings, Group Business Strategy IR conference, 26 May 2026 - Japan P&C: market share, combined ratios, auto insurance, premiums, sales channels and the regulatory orders. — 2016-2026 · publ. 26 May 2026 · source ↗
  9. ReportedThe first quarter of the current year showed claim frequency unchanged and unit costs up 7.5%.
    Tokio Marine Holdings, overview of first-quarter FY2026 results - progress against the plan, large losses, the Middle East, strategic equity sales and natural catastrophes. — April-June 2026 · publ. August 2026 · source ↗
Sources
Generated September 24, 2026