The Taiwanese arm, Tokio Marine Newa Insurance, ranks fourth in its market. The company offered coverage for Covid-19 illnesses or quarantines, eventually signing 940,000 policies.

Tokio Marine Newa stopped accepting new Covid customers by Feb 15 as the omicron wave of the coronavirus brought a surge of prospective subscribers. Estimating an aggregate infection rate of 30%, the company projects a net loss of ¥110.1 billion for the six months ended June.

The parent Tokio Marine owns 48.94% of the equity-method affiliate, which translates to a ¥53.9 billion impact to be booked in the current three months through September, according to a quarterly earnings briefing Friday.

“Other businesses are performing strongly, especially in overseas operations, so we don’t plan to revise financial projections at this point,” said Kenji Okada, the group’s chief financial officer.

The parent, which faces the task of financially rehabilitating Tokio Marine Newa, intends to lift its ownership to 50.18% by the end of the quarter to take control of the affiliate.

Covid insurance claims have swamped other providers. MSIG Mingtai Insurance, a Taiwanese subsidiary of Tokyo-based MS&AD Insurance Group Holdings, holds 130,000 coronavirus policies. A charge of over ¥10 billion is expected to be booked on a pretax basis for the financial year ending March 2023.

“We forecast that the loss will impact earnings to a certain extent, and we’re closely reviewing the full-year guidance,” said a representative at MS&AD.