Morgan Stanley Estimates Japanese Insurers’ Private Credit Holdings at 1%-3% of AUM

Morgan Stanley published estimates of private credit holdings for major Japanese insurers as of the end of fiscal year 2025. The bank’s analysis places exposures between less than 1% and roughly 3% of assets under management for the firms covered, with varying proportions when measured against adjusted net assets or embedded value.

Key Points

Morgan Stanley estimates private credit exposure among major Japanese insurers ranges from under 1% to about 3% of assets under management.
When measured against adjusted net assets or embedded value under IFRS, the same holdings represent substantially larger percentages for some insurers - for example, around 10% for Tokio Marine HD and about 13% for T&D HD.
Sectors impacted include insurance and fixed income/private credit markets, as the estimates relate directly to insurers' balance sheets and alternative credit allocations.

Morgan Stanley has compiled estimates of private credit exposure for a group of major Japanese insurers, presenting the figures as a share of assets under management (AUM) and of adjusted net assets or embedded value as applicable. The bank's figures are based on currently available information and the firm cautions they may not be strictly comparable across companies.

Company-level estimates

Tokio Marine HD - Private credit exposure estimated at around A5600 billion, which the bank says represents roughly 2% of AUM and about 10% of adjusted net assets under IFRS.
Sompo HD - Exposure estimated at around A5100 billion, equivalent to less than 1% of AUM and approximately 4% of adjusted net assets under IFRS.
MS&AD - Exposure estimated at around A5200 billion, a level described as under 1% of AUM and about 3% of adjusted net assets under IFRS.
Dai-ichi Life - Exposure estimated at around A5630 billion, or roughly 1% of AUM and near 8% of embedded value.
T&D HD - Exposure estimated at roughly A5550 billion, including its Fortitude stake, which the bank estimates as under 3% of AUM and about 13% of embedded value.
Japan Post Insurance - Morgan Stanley reports that Japan Post Insurance does not hold such private credit assets.

Context and caveats

The bank noted that its estimates rely on information that is currently available and that the figures may not be directly comparable between companies. Morgan Stanley presented the exposures both as a proportion of AUM and against adjusted net assets or embedded value under IFRS where relevant.

What this shows

The reported range of private credit exposure across the covered insurers runs from less than 1% to about 3% of AUM, while the same holdings translate to higher percentages when measured against adjusted net assets or embedded value for some firms. The figures indicate varying degrees of private credit allocation within each insurer's broader balance sheet.

These estimates are drawn from Morgan Stanley's compilation and reflect the information available to the bank at the time of its release.

Risks

The estimates are based on currently available information and may not be strictly comparable across companies, introducing uncertainty in cross-firm comparisons - this affects analysts covering insurance balance sheets and asset allocation.
Different measurement bases are used (AUM versus adjusted net assets or embedded value under IFRS), creating ambiguity about the relative scale of exposures across firms - this is a risk for investors assessing credit concentration within insurers.
Data limitations in the underlying information could lead to revisions if more complete disclosures emerge, which would affect assessments in the insurance and credit markets.

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Key Points

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