GIAJ Chairman's Statement released on March 17, 2011(March 17, 2011

On behalf of the General Insurance Association of Japan (GIAJ), I would like to express my sincere appreciation for the thoughtful messages of sympathy we have received from all over the world, including from insurance industries and related organizations regarding the earthquakes and tsunami in eastern Japan.

We in the Japanese general insurance industry are trying our best to sympathetically answer consultations from affected people, including policyholders, and to make prompt payment of insurance claims.

As the Chairman of the GIAJ, I have renewed my resolve to carry out the above missions as follows:

1. Introduction

On the afternoon of March 11, “The 2011 off the Pacific coast of Tohoku Earthquake”, with the largest ever magnitude of 9.0 on the Richter scale in recorded history in Japan, occurred and the following gigantic tsunami, which was much bigger than previous assumptions, hit the Pacific coast of Tohoku, causing many people to be killed or go missing. Many houses and buildings were washed away in a moment, bringing about severe damage extensively. Furthermore, the subsequent many earthquakes and accidents in nuclear power plants have caused anxiety among the public and we are now facing a “national crisis”indeed.

Evacuees in the devastated area are trying very hard to overcome difficult times even with a large amount of anxiety. I’m overwhelmed by a flood of emotions when I give thoughts to them and it is difficult to find words enough to express my feelings in this situation. In addition, there are many insurance company staff and agents whose safety remains unknown.

Mr. Hisahito Suzuki, Chairman
Mr. Hisahito Suzuki, Chairman
I would like to offer my heartfelt condolences to the victims and my sympathies to the devastated.

I also would like to express my sincere respect and appreciation to the personnel of Self-Defense Forces, police, fire department, medical institutions, municipal governments, voluntary bodies and others, who are working on ceaseless rescue-and-support missions, for their dedicated efforts.

The general insurance industry has important missions to "support the stability of society and development of the economy" and to "provide the public with security and safety" as well. In such an unprecedented national crisis, we have made up our minds to make all-out efforts for swifter recovery of the devastated areas and the stability of Japanese society and the economy.

At the Board Meeting and Extraordinary General Meeting of the GIAJ, all our member companies have agreed to take the necessary measures for the convenience of the afflicted people by adopting "Measures against the Earthquakes in eastern Japan". We, the general insurance industry, would like to declare that we are determined to respond to consultations from affected people with empathy and do all we can for prompt payment of insurance claims.

Furthermore, at the Board Meeting, for the support of afflicted people and the recovery of the devastated areas, we have decided to send relief supplies and monetary donations to the devastated areas and confirmed that our respective member companies should strengthen their efforts in supporting the regions affected.

As I mentioned at the beginning, this massive earthquake has brought about enormous, widespread damage. Judging from the number of earthquake insurance contracts and others, the amount of insurance claims paid out is expected to be the highest ever.

However, our member companies have set aside and accumulated funds as the Ordinary Policy Reserves for payment of future insurance claims and the Catastrophic Loss Reserves for damages caused by catastrophes. At this critical time in our country, we have received offers of assistance from around the world. In the general insurance industry, we have a similar worldwide system of mutual aid, in the form of reinsurance, by which insurance companies all over the world can share the risk and support each other. Backed by the above, all our member companies maintain sound and sufficient Solvency Margin Ratios, which serve as indices to show the level of solvency of an insurance company.

Earthquake risks are too large to be underwritten by private insurers alone; thus some portion of the risks on dwelling risks is to be reinsured by the Japanese Government to ensure full payment to beneficiaries. Please rest assured that Japanese general insurance companies will neither fail under their claims payments, nor will their financial soundness be undermined.

2. Measures taken by the General Insurance Industry

Right after such huge disasters have occurred this time, our member companies have implemented various measures such as securing bases to replace the destroyed offices, dispatching personnel to the offices in the devastated areas and increasing staff in call centers so as to strengthen the system for claims payments and inquiry responses in the affected areas.

The following are the industry-wide measures taken for the affected customers:

(1)Establishment of a special helpline for inquiry response and consultation services

We have established a special helpline for consultation services within the GIAJ, thus responding to inquiries from affected people and customers with empathy.

We also intend to build a cooperative system aligning each member company’s helplines.

(2)Establishment of “Earthquake Insurance Central Command in Tokyo” and “Earthquake Insurance Local Headquarters in Sendai”

We have established an “Earthquake Insurance Central Command in Tokyo” at the headquarters of the GIAJ and also an “Earthquake Insurance Local Headquarters in Sendai” at the Tohoku Branch Office of the GIAJ, respectively, so that all the general insurance industry can take every possible measure against the earthquake this time. Thus, we will centralize data in closer cooperation with each member company and secure a smooth process for claims to be paid in a prompt, fair and appropriate manner.

(3)Formulation of a cooperative loss survey system

Taking utmost care of the burden of customers who have suffered in the earthquake, the general insurance industry is now working together for claims payment. We intend to make claims payment as promptly as possible through the formulation of a cooperative loss survey system beyond each company's system.

(4)Special measures

All GIAJ member companies will implement special measures such as extension of a grace period regarding the conclusion of a continuing contract and premium payment by taking the customers’ distressed conditions into account.

3. Conclusion

I am sure that we can definitely overcome this great national crisis caused by the largest ever earthquake recorded by ensuring that all the people should play their respective roles in cooperation with politicians, bureaucrats and corporations.

Having witnessed people living in the devastated area, I have renewed my awareness that Japanese people are well-regulated and patient, act in a calm and reassuring manner and work diligently even in the face of this debacle.

As Chairman of the GIAJ, I would like to declare that I will take a lead in “giving industry-wide support" to the devastated area in an effort to overcome this national crisis.

Last but not least, I would like to extend all the best wishes for the recovery of the affected areas as soon as possible.