Assessment of Financial Impact from Climate Change Risks

Tokio Marine & Nichido Fire Insurance Co., Ltd.

Publication date	September 9, 2024 (Posted on July 25, 2025)
Sector	Industrial and Economic Activities / Natural Disasters and Coastal Areas

Company Overview

Tokio Marine & Nichido Fire Insurance Co., Ltd. is the core subsidiary of Tokio Marine Holdings in the domestic non-life insurance business.

Climate Change Impacts

Climate change is a global and historically unprecedented challenge that threatens the safety and security of both customers and society. The intensification of natural disasters has a significant impact on corporate management. Therefore, companies are expected to comprehensively assess the impact of future climate change on their business and disclose this information in accordance with TCFD (Note 1) recommendations, and to incorporate these insights into stakeholder communications.

Adaptation Initiatives

As a founding member of the TCFD, Tokio Marine Holdings has contributed to the promotion and dissemination of climate-related information disclosure as well as the enhancement of investment decision making through transparent reporting. In addition, the company provides comprehensive consulting services to support businesses in aligning their information disclosure practices with TCFD recommendations.

Leveraging our extensive knowledge and expertise, we have developed a system capable of quantifying the financial impact of climate change and offer the "TCFD Disclosure Support System Service" (Fig. 1 and Fig. 2). This system is designed for direct use by customers, and can be used not only as a starting point for corporate GX (Note 2) strategies, but also as a framework for TCFD recommendations and information disclosure based on IFRS S2. By simply entering the address and building information for each site, the system can calculate the hazard levels and financial impacts of climate change for each location and for future years under multiple climate scenarios. For global sites, the system utilizes the WRI Aqueduct (Note 3), while for domestic sites, it uses a model incorporating inundation depth data from the Ministry of Land, Infrastructure, Transport and Tourism.

Effects/Expected Benefits

By utilizing this system service, companies can identify and quantitatively assess climate change risks, which are particularly important for TCFD information disclosure, while also visualizing their future financial impact. In addition, since customers can flexibly adjust the system’s estimation parameters, the system serves not only as a tool for TCFD disclosure, but also as a resource for formulating their own mid- to long-term business strategies and enhancing risk management practices related to climate change.