Tokio Marine to establish new Canadian P&C insurer with $58m capital injection

Tokio Marine Holdings has unveiled its plans to launch a new property and casualty (P&C) insurance company in Canada to target expansion in an "attractive market based on its size, profitability and stable business environment".

The insurer has announced its intention to apply for the incorporation of Tokio Marine Canada, with a capital injection of C$75 million (approximately $58 million).

It will write commercial insurance, mainly focusing on specialty business with limited overlap with the existing businesses, and aims to achieve a premium of several hundred million CAD in five years.

Tokio Marine Canada is expected to be incorporated in the second half of 2021, and commence business in the first half of 2022, subject to regulatory approvals.

Tokio Marine Group currently writes business in this market through the Canadian branch of Tokio Marine & Nichido Fire Insurance (TMNF) and the Lloyd’s operations handled by its international subsidiaries. It has been considering other means to further expand its operations in this "high potential" market with a premium of over C$65 billion (approximately $50 billion).

Tokio Marine hopes the move will enable the group to respond to a broader range of customers’ needs, build a platform to realise mid to long term growth in the market, and achieve further profit growth as well as portfolio diversification of its international business.

The company said that it has been focusing on expanding scale and profitability of its international business as the key growth driver of the overall group, by pursuing both organic and strategic M&A initiatives in both developed and emerging markets.

In developed markets, Tokio Marine has diversified its portfolio centered around specialty insurance business, while it has been actively seeking growth opportunities in emerging markets.