The GIAJ Chairman's Statement on June 16, 2011

"General insurance sincerely interacting with society in the spirit of mutual support - Challenge together with local communities-"
(June 28, 2011

 I would like to report on the issues of concern during my tenure of office as Chairman of the GIAJ and express my views thereof as follows:

1. Introduction

 Needless to say, the biggest event of the past year was "the Great East Japan Earthquake", which has affected every facet of Japan including the general insurance industry.

 This massive disaster claimed many lives as well as possessions, and has forced many people to live hard lives in shelters, etc. The nation as a whole is feeling strong anxiety over the power shortages and unpredictable problems related to the stricken nuclear power plants. Despite three months or so having passed since the unexpected disaster, we are still facing hardships related to it. One of the most significant subjects for us is "rebuilding and rebounding from the disaster".

 This disaster has delivered huge trials and tribulations to the general insurance industry. We might summarize that the "general insurance industry has been given considerable attention by society, which has called into the question the raison d'etre of insurance".

Mr. Hisahito Suzuki, Chairman
Mr. Hisahito Suzuki, Chairman
 Under these circumstances, the general insurance industry, the GIAJ and all its member companies, have cooperated with each other, and have implemented unprecedented measures one after another. In particular, we have implemented "prompt and appropriate payments".

 The total amount of Earthquake Insurance on Dwelling Risks payouts has reached 974.5 billion JPY with the total number of payouts reaching 533,000 as of Jun 15. The proportion of settled claims in response to inquiries is 91.5%. We could accomplish these achievements primarily by concentrating on the task. We have been reminded of the true meaning and purpose of insurance through experiencing this unprecedented disaster.

 Considering the scale of the disaster, we think it is difficult for some afflicted insured persons to make inquiries to their insurers. With this in mind, we are implementing further measures to ensure information reaches people who have not yet made inquiries, but may nonetheless be victims who have the rights to claim insurance payments. We have to continue to do our best.

 The disaster aside, the GIAJ and all its member companies have many other significant issues to resolve, one of the most pressing of which is the financial reports of our member companies for the 2010 fiscal year. The general insurance business environment has been very tough as the amount of payment for car insurance has been raised by 2% compared to the previous fiscal year. Taking all this into consideration, we recognize that one of the biggest challenges we face is to make greater efforts regarding traffic safety, disaster prevention and security measures to improve the car insurance loss ratio.

2. Fiscal issues during the Chairman's tenure

 I adopted the position that the general insurance industry had both a responsibility to "support the stability of society and the development of the economy", and to "provide the public with security and safety" when I took up the post of the GIAJ chairman. Since Japan was at that time in the throes of a severe social and economic upheaval, I indicated that we were required to fulfill these responsibilities to the very best of our ability.

 As such, following the Great East Japan Earthquake disaster, the general insurance industry was required to fulfill its responsibility immediately and face the disaster industry-wide. We re-realized how important our responsibilities were which were settled at the beginning of this fiscal year.

 I would mainly like to report the following three measures and action taken this fiscal year, taking into account the newly recognized matters corresponding to the earthquake.

(1) Promotion of educational activities for consumers

 This fiscal year, we positively promoted educational activities especially for "young people and children".

 As for the introduction of a study course on general insurance for university students, in total 194 lectures were given as of the end of March, which far exceeded the previous fiscal year's 139 lectures.

 Following on from this, "a series of lectures," the content of which can be learnt systematically, are going to be accepted and implemented in 13 universities by all of 11 GIAJ's branches.There are many applicants beyond the presumption at the some universities. This indicates that students are rapidly becoming interested in general insurance or risk management because of the disaster that occurred on March 11. We are, therefore, going to encourage many other universities to adopt these lectures.

 As of this fiscal year, "practice programs of general insurance for high school students" have been implemented at 32 schools which far exceeds the original target of 20.

 Regarding the program, "exploration for disaster prevention" for elementary school children, 1,607 applicants submitted their own prevention maps, accomplishing our target. That was the largest number in our history with applicants from every prefecture. We heard that some elementally school children reacted flexibly and could narrowly escape TSUNAMI due to ongoing disaster drill practice. This highlights the effectiveness of educational activities for disaster prevention/mitigation.

 We proceeded with these implementations because we believe it is indispensable for the next generation to understand correctly the risks surrounding them, and the fact that insurance is a way to reduce such risks. We re-realized why people have to be aware that there are a variety of risks associated with their everyday lives, and that they need to acquire skills to manage those risks. We feel that people should begin to learn those skills at as early an age as possible. We would like to continue promoting such activities.

(2) Strengthening of the GIAJ's capacity to respond to consultations and opinions from consumers

 On October 1, last year, the GIAJ began operating as a General Insurance ADR Support Center, which is a designated alternative dispute resolution organization stipulated under the Insurance Business Law. While only a few months have passed since the inauguration, the number of applications for complaint and dispute resolution that have been received at the center so far has exceeded our expectations. We think this represents the high degree of expectation this system has from consumers. We would like to give due consideration to, and try our best to meet these expectations.

 Immediately after the occurrence of the Great East Japan Earthquake, all the GIAJ's member companies affirmed their commitment to respond to consultations from the people affected with empathy and the utmost care, and have taken various new measures such as the establishment of the "System for Searching for Earthquake Insurance Contracts on Dwelling Risks" in the GIAJ. We would like to make use of the experiences gained through our efforts for making general insurance more consumer-friendly for the people affected, in order to strengthen our functional ability to respond to various consultations and opinions in the future.

(3) Establishment of a new examination and educational system for general insurance solicitors

 We have made preparations for a "General Examination for General Insurance Solicitors", which is to start this October. Under this examination system, standardization of educational contents, which vary from company to company, will be promoted. In addition, the passing of the examinations will be made a "precondition for insurance distribution", thus enhancing an industry-wide educational system. To ensure effective operation of this examination system, we will start an "Insurance Solicitors’ Qualification Information System'' which consolidates information on the solicitors' passing status simultaneously at the start of new examination. Furthermore, we have decided to introduce a "General Insurance College Course" in which general insurance solicitors can further advance their knowledge and expertise.

 Insurance solicitors have direct contact with customers on a routine basis. They are playing an important role in promoting prompt payment of insurance claims by visiting the people affected by the Great East Japan Earthquake. I have renewed awareness that their familiarity with customers makes them feel more at ease.

 We will continue our industry-wide efforts to improve the quality of business processes provided by solicitors.

 In addition to the above three priority issues, we have also advanced our efforts on "traffic safety promotion, disaster preparedness and prevention, and crime prevention", and our "contribution to the global community".

 As I mentioned, 'traffic safety promotion, disaster preparedness and prevention, and crime prevention' are urgent priorities for us in the wake of the increase in the amount of automobile insurance claims paid. We are engaged in providing information for the prevention of traffic accidents through the "introduction to traffic-accident-prone intersections", and promoting the "combating automobile theft campaign". Eleven regional offices of the GIAJ are carrying out their own activities that are appropriate for their respective regions.

 Furthermore, we issued a "Guidebook on how to read hazard maps distributed by municipal governments" which covers floods and earthquakes. We will disseminate it nationwide through agents who play a pivotal role in consumer "risk" education.

 In coping with the increasing globalization of the general insurance business, we have actively participated in discussions for setting sound international standards for insurance supervision by advocating our views and position at various consultations by the International Association of Insurance Supervisors (IAIS).

 Following the Great East Japan Earthquake, we have received many messages of encouragement from insurance-related organizations all over the world. I would like to take this opportunity to express our appreciation for such thoughtfulness. I have reaffirmed my determination to further promote mutual understanding and strengthen partnerships with our international counterparts by continuing active exchanges.

 On June 3, the GIAJ held the 19th session of the "Advisory Panel to Listen to Consumers' Voices", in which discussions were focused on the Japanese general insurance industry's response to the Great East Japan Earthquake. Our efforts were appreciated as being able to fulfill the expected functions of general insurance effectively by the external committee members, and expectations for further efforts in the future were expressed by them.

3. Conclusion

 At the time of insurance claim payments for this disaster, the staff of general insurance companies and agents have heard words of appreciation from many customers. Through customer responses to the disaster, we have gained many valuable experiences; Examples include that both staff of insurance companies and agents, who are there to support the people affected, heard encouraging words from them.

 I believe that it is important for us to make use of the "lessons" and "thoughts" learned from such experiences, and convert them to concrete "actions" that make our industry more trusted by customers. For instance, "actions" can be materialized by continuing to disseminate earthquake insurance to as many people as possible while remembering the words of appreciation from the people affected, and developing network systems with municipal governments to ensure quick communication in the case of future possible catastrophes. We should accelerate such efforts by making use of the above "lessons" and "thoughts" as a driving force, which, I believe, make the roles and existence of the general insurance industry in society more important.

 When I took office as Chairman of the GIAJ a year ago, I set the following catchphrase for my term, i.e., "General insurance sincerely interacting with society in the spirit of mutual support - challenge together with local communities". This represents my belief that we need to manage respective customers with sincerity and further facilitate interactive communication with them nationwide. Today, I would like to reiterate this message for expressing my sincere wish that all of us overcome the current difficulties and take on the challenge of building a new Japan by supporting each other for the early rehabilitation of our country.

 We, in the general insurance industry, will do our best to support the above efforts in a stable manner.