AM Best has affirmed its A+ (Superior) financial strength ratings for Mitsui Sumitomo Insurance Company and Aioi Nissay Dowa Insurance Company, the two core non-life operating units of Japan’s MS&AD Insurance Group Holdings.

The rating agency simultaneously assigned an A+ financial strength rating to MSIG Specialty Insurance America, a newly formed excess and surplus lines entity established to support the group’s expansion in the United States. The new unit has been incorporated into an existing pooling agreement with three other US subsidiaries.

AM Best assessed MS&AD’s balance sheet strength as strongest, citing risk-adjusted capitalisation at the highest level and an adjusted financial leverage ratio of 14.1 per cent as of March 31 2026. The agency noted the group’s accelerated disposal of strategic equity holdings should gradually reduce domestic equity risk exposure.

The Japanese group reported improved domestic underwriting profitability in fiscal year 2025, supported by premium rate revisions, lower natural catastrophe losses and better performance in fire insurance. Overseas operations, particularly Lloyd’s and reinsurance business, showed strong earnings growth.

MS&AD holds approximately one third of Japan’s non-life insurance market by net premiums written. MSI and ADI are scheduled to merge in April 2027, a move AM Best said should reinforce the group’s competitive position in the mature domestic market.

Overseas operations now contribute roughly 35 per cent of the group’s non-life net premiums written. The agency noted MS&AD continues to prioritise US market expansion through organic and inorganic initiatives.

AM Best also affirmed an A- (Excellent) rating for Aioi Nissay Dowa Insurance (China) Company, which focuses on Toyota-related motor insurance. The Chinese subsidiary’s net profit doubled in 2025 to RMB82.6m, driven by improved underwriting performance.

All ratings carry stable outlooks.