Fitch Ratings has assigned Sompo Holdings, a Japanese global insurance and financial services group, a first-time Long-Term Issuer Default Rating (IDR) of 'A+'. The credit ratings agency also assigned an 'AA-' Insurer Financial Strength (IFS) rating to the core subsidiary, Sompo Japan Insurance. The outlook for both ratings is stable.
Fitch said the ratings reflect Tokyo-headquartered Sompo Holdings’ ‘Favourable’ company profile, ‘Very Strong’ capital adequacy and ‘Strong’ financial performance. These factors offset the domestic equity exposure in its investment portfolio.
Losses linked to the Iran conflict are expected to be limited, partly due to war-exclusion clauses in most policies and the group’s minimal investment exposure to the Middle East.
Sompo Holdings has managed natural catastrophe losses in Japan and the US to date, supported by its globally diversified business and investment portfolios, as well as strong enterprise risk management. It has maintained low financial leverage of 12% as at end-March 2025 and robust fixed-charge coverage.
Capitalisation
According to Fitch, Sompo Holdings continues to demonstrate ‘Very Strong’ capitalisation, with a robust Fitch Prism Global Model score at end-March 2025. Risk exposure is declining through the ongoing divestment of strategic domestic equity holdings, with the company expecting its economic solvency ratio to remain around 250% for the financial year ending March 2026 (FYE26). It plans to sell more than JPY200bn, or about 20% of its listed domestic equities, in FYE26, with further divestments expected to strengthen capital adequacy over the next five years.
Profitability
Profitability is also expected to improve, supported by continued premium rate increases reflecting claims experience in property and motor lines amid more frequent natural catastrophes in Japan. Fitch said these rate adjustments have contributed to Sompo Japan Insurance Inc.’s combined ratio improving to 90% in the first half of 2026, from 97% a year earlier.
International business
Fitch also highlighted the group’s expanding international franchise, with overseas premiums expected to account for around half of total non-life premiums and overseas profit projected to exceed 50% of the group total in 2026. Around half of its international insurance business is estimated to come from the US. In August 2025, Sompo announced plans to acquire Aspen Insurance Holdings for $3.5bn, a move expected to strengthen its US specialty, Lloyd’s and international reinsurance operations. North American premiums are projected to exceed 50% of international business by FYE27.
Fitch noted that the impact of natural catastrophes remains manageable, as the group avoids underwriting such risks outside Japan and has not faced significant catastrophe losses domestically so far in FYE26.