Tokio Marine Holdings SWOT & PESTLE Analysis

Strengths

1. Active diverse insurance portfolio: Tokio Marine is in various domains which include domestic nonlife business insurance, domestic life insurance business, international insurance business, and general business. In FY2017,13% of their insurance premiums will come from the domestic life business,34% will come from international business, and 53% will come from the domestic non-life business. The diversification has enabled to improve their performance.

2. Wide retail distribution and claim services: The company has a wide network both inside and outside of Japan which allows them to address customer needs and in supporting claims. Outside Japan, they have grown exponentially by acquiring Kiln, Delphi, Philadelphia, etc. It will help the company to take care of customers in their local markets as well as expand globally.

3. High level of specialty and business understanding: Tokio Marine develop an expertise to create products and services that meet the needs of the customers. For e.g., Super Insurance was designed for the Japanese market. It provides both life and non-life protection to entire family and can also be customized as per customer needs.

4. Sound financial base: They have a stable business portfolio and are continuously receiving same rating or higher than the Japanese sovereign rating. They have been rated by highly rated organizations where S&P rated them A+, Moody’s gave them Aa3 and A.M. Best rated them A++ which indicates the organization is financially secure and stable.

5. Stable workforce and diverse culture: It has a dedicated workforce with 51,302 agents in Japan and also it operates in 38 countries. They used a strategy called “Majikira” which is embedded in the DNA of the company. Majikira is a Japanese word which means to have a discussion on a serious topic but in a casual manner. There exist townhall meetings and open discussions which encourage the people to speak on the issues.

The unpublished sections of the entire SWOT analysis is available in the 'Complete Report' on purchase.

Political

1. Issue of Brexit: Brexit will majorly affect the worldwide insurance industry and not only for associations situated in the UK. There will be a different UK which can present insurance agencies to threats as well as additionally openings. There will be an adjustment in the financial markets which will impact an insurer's invested assets. It will also affect the work and the capacity to hold the workforce across Europe and Asia.

2. Rising threat of war with North Korea: There are already many disputes with North Korea with the latest being, firing ballistic missile over Japan. The Prime Minister of Japan, Shinzo Abe has warned North Korea over there activities and this has created a sense of panic among Japanese. This whole scenario will create an impact on the insurance industry, where people will be worried about their life and property.

3. Abenomics policies: Japan has implemented Abenomics, a growth strategy which composed of monetary easing, fiscal stimulus and structural reforms. This initiative was taken by the government to shake up the Japanese economy to increase the growth. These decisions led to the ease of doing business in Japan, with very low tax rate and regulations.

Economic

1. Growth in Emerging Market: Tokio Marine can tap into emerging markets and expand their business in India, China or Mexico. These countries are growing impressively from many years and it can become a great investment for the company. Moreover, majority of the operations of organization is in Japan, they should also start aggressively expanding into other countries to increase their foothold.

2. Negative interest rates: Japan suffered from low interest rates from the start of the millennium which declined the real estate markets along with a volatile stock market. In 2016, This impacts the profitability of the insurance industry drastically and forces them to diverse their portfolio and expand their market into other regions.

Social

1. Changing roles in the consumer interaction: Customers are progressively requesting transparency and speed in their connections with organizations, including insurance agents. Because of increment in the innovation around, consumers are expecting higher desires. Individuals are getting more aware and insurance are purchased by clients and not sold by the agents. There has been a shift in the roles and agents need to re-examine their roles in the insurance value chain

2. Rise of middle class: In the developed, the old outnumbered young however in nations, for example, India, Mexico the working-age population is more than the dependent population. This will bring about the rise in the profitability of the nation all in all. The rise of the middle class will demand more products and services. People will cater for insurance products and there will be increase in the business.

3. Increasing usage of social media: The online networking is rising exponentially and it will keep on empowering the customers and organizations to communicate transparently. The development of social media will help move the power towards clients. People will exchange more personal information in the public domain and the trust factor will start to increase from insurance agents to online communities.

The unpublished sections of the entire PESTLE / PESTEL analysis is available in the 'Complete Report' on purchase.