Sumitomo Life Insurance Co plans to invest approximately JPY300bn ($1.9bn) in private credit during the fiscal year starting April, marking a continued push by Japanese insurers into alternative assets to enhance returns, according to a report by Bloomberg.
The Osaka-based company has steadily increased its exposure to private credit, which CEO Yukinori Takada said is attractive for its potential to generate higher spreads. Sumitomo Life currently holds around JPY1.6tn in private credit, including collateralised loan obligations, as part of its total assets of JPY37.5tn at the end of 2025, making it one of Japan’s four largest life insurers.
Despite global headwinds in the $1.8tn private credit market, including weak performance and fund redemptions, Japanese insurers remain active investors. Private credit’s longer-duration structure aligns well with life insurers’ need to match liabilities with long-term assets.
Under a new three-year management plan starting in fiscal 2026, Sumitomo Life aims to increase annual spread income—from JPY159bn currently to about JPY300bn – with a medium-term target of JPY400bn. The firm will continue to monitor higher-risk sectors closely and prioritise joint oversight between investment and risk management teams.
Sumitomo Life also plans to execute JPY700bn in ESG and transition finance investments over the period, focusing on projects that support decarbonisation and sustainable practices.
