Inaugural address by New Chairman of Association (Translation)(July 23, 2003

Mr. Ken Matsuzawa delivered his inaugural address as Chairman of the General Insurance Association of Japan after his election on June 30, 2003 Mr. Ken Matsuzawa, Chairman
Mr. Ken Matsuzawa, Chairman

1.The Environment surrounding the general insurance business

Since the liberalization and deregulation of the general insurance market in 1996 when the Insurance Act was revised, the general insurance companies have competed with each other in terms of services, quality and price of products. This, together with the development of information technology, new insurance products and services now mean that the market changes rapidly. In Japan words such as "anxiety" and "uncertainty" reflect the social situation. In these circumstances, the risks that customers face have diversified and increased. In addition to such typical daily risks as traffic accidents, natural disasters and fire, emerging risks, for example, international organized car theft, Internet crime and widespread transmission of SARS (Severe Acute Respiratory Syndrome) in Asia, have increased. With the increase of risks, the Association is aware that the horizon for general insurance has also expanded.

2. Challenges

In recognition of the above circumstances and situations, the general insurance industry will conduct the following activities to make general insurance more reliable and to make general insurance more a part of the customer's life".

(1) "Making general insurance more reliable"

We, the general insurance industry will conduct the following activities to make general insurance more reliable to our customers.

- Enhancement of corporate social responsibility including improved ethics and thorough compliance with law and regulation.
- Ensuring over the soundness of each insurance company's management by improved risk management and transparency.
- Revision of the policyholders' safety net
- Study on the establishment of the system to underwrite terrorism risks

(2) "Making general insurance a part of the customer's life"

Our customers often say that general insurance products are invisible and hard to understand. We suppose that this might have been brought about by the diversification of products, prices and services provided by insurance companies. To improve the situation, the general insurance industry will conduct the following activities so they can feel that general insurance is a part of their lives.

a) Provision of easy to understand information to the customers utilizing the Sonpo Information Square and our web site effectively.

b) Anticrime, loss prevention and traffic safety activities

- Prevention of automobile thefts
- Provision of useful information to prevent burglaries by picking locks and credit card thefts
- Provision of information on typhoons, flood and other disasters - Development of the process of claims settlement for large-scale natural disasters

3. Globalization

We will conduct the following activities.
- Submit opinions and requests to the IAIS (International Association of Insurance Supervisors) which is working on international standards of insurance supervision and the IASB (International Accounting Standard Board) which is working on international accounting standards that involve general insurance. These standards shall have a strong impact on the Japanese general insurance market.
- Delivery of opinions and requests concerning the issues and subjects on service sector's liberalization now discussed at the WTO.
- Provision of information on the Japanese general insurance market to the foreign insurance market and to strengthen cooperation of the Association with the United States, Europe and Asia.

4. About the reformation of the Association

The Association has carried out the New Mid-term Business Plan for the last 3 years since the beginning of 2001. It has been very successful and is expected to attain further achievements by the end of the plan in March 2004. We would like to conduct our missions proactively, and make ourselves efficient and useful so we are evaluated highly by our customers.

In closing, we hope for your continued support of our industry.