June 14, 2018

　Over the past year, unprecedented natural disasters such as Typhoon Lan, the largest ever typhoon to strike Japan, and heavy snowfall across Hokuriku in February, have inflicted severe damage and losses nationwide. We wish to once again extend our sincerest condolences to the victims and sympathies to those who were affected.

　In addition to providing prompt and proper payments to customers affected by such disasters, the general insurance industry will continue to focus on fulfilling its public role and mission of providing the infrastructure to support building a worry-free and safe society by further promoting disaster prevention and reduction activities at ordinary times.

　Fiscal 2017 marks the final year of our Seventh Mid-Term Business Plan. We have promoted the implementation of key issues to achieve its goal: "to contribute to 'a safer, more secure society' through achieving sound development of the general insurance industry and raising the level of public confidence in us". Our major initiatives are described in "3. Our Initiatives during the last 12-month period" below.

　As the Seventh Mid-Term Business Plan was coming to an end, we developed the Eighth Mid-Term Business Plan which began this April. The Plan is intended to be the basis from which our association, celebrating its 100th anniversary, takes a step forward towards the new era. Based on our reflections on the past and future, the Plan sets forth four directions that the general insurance industry should strive toward in order to ensure that it continues to achieve sustainable growth. They are "Swift and proper responses to environmental changes", "Promotion of customer-oriented business operations", "Establishment of a more robust and stable general insurance system", and "Further roles in international insurance markets". These directions are further divided into eleven priority issues such as "Technological innovation" and "Enhancing the quality of business operations at insurance companies and agents", each of which has already been embarked upon. The GIAJ will further accelerate its efforts on each of these priority issues.

　Given that our association reached its 100th anniversary last May, we held a commemorative event in November with the aim of reflecting on our path over the past 100 years and looking towards the future of general insurance.

　The event saw participation by many industry professionals, most of them young practitioners who will lead the industry's next generation. During a panel discussion, experts from various fields presented their views and offered suggestions on ways for our industry to make great strides in the future, making the day a very meaningful one.

　In collaboration with local communities including municipal governments and relevant parties, we offered information and promoted awareness-raising activities which contribute to disaster prevention and reduction in many ways.

　We delivered a series of disaster prevention educational events across the country including our participation in the "Bosai Kokutai 2017" held in Sendai City, Miyagi Prefecture last November. As public support has limitations, self-help and mutual-help among local residents are vital for the protection of lives and disaster reduction in the event of a mega disaster. Focusing on the specific risk characteristics of each region, each event provided programs such as a leader-training program to increase disaster preparedness at the local level.

　In March, the GIAJ launched the "Sonpo Bosai Web", a web portal on disaster prevention. The website is intended to provide wide-ranging useful information unique to the general insurance industry, such as a database of losses and claim payments resulting from typhoons and floods, developed jointly with the Japan Meteorological Agency.

　In fiscal 2017, we held our 14th annual "Exploration for Disaster Prevention" map-making competition for elementary school pupils. Against the backdrop of increasing public awareness of natural disasters, we have steadily expanded the range of the campaign. This time we received 538 group entries from the 16,370 children who participated in the program. To date, the total number of participants has reached 5,024 group entries from 167,547 children, making it the largest event of its kind in Japan.

　Considering the potential threat of events such as a Tokyo Inland Earthquake and a Nankai Trough Earthquake, we have worked on further improving market penetration of earthquake insurance and enhancing preparedness within the industry.

　As for promoting earthquake insurance, in addition to PR activities made through media outlets, the GIAJ held events in which families could learn about disaster prevention through hands-on experiences. Garnering a total of 13,761 participants, these events took place at twelve shopping malls across the country. To effectively promote earthquake insurance, the GIAJ also held activities in collaboration with local municipal prevention initiatives in Nagano Prefecture and Yokohama City, Kanagawa Prefecture. We have also intensified our support for agents who play important roles in promoting earthquake insurance through a series of seminars in 14 locations nationwide. Around 1,400 agents deepened their understanding of earthquake risks in their local areas. As a result of these wide-ranging efforts, the number of earthquake insurance policies being issued has steadily increased. The total number of policies in force at the end of February stood at approximately 18.71 million, an increase of about 550 thousand from the previous year and an increase of about 1.68 million policies compared with the figure at the end of March 2015, prior to the implementation of the Seventh Mid-Term Business Plan.

　Meanwhile, our association has enhanced its readiness to make prompt and proper payments of earthquake insurance claims in the event of a large-scale disaster. We have enhanced educational tools for insurance company employees and registered property loss assessors, including promoting the use of mobile devices for damage survey. We also reviewed the GIAJ's business continuity plan in parallel with those of our member companies. We clarified the high-priority functions that are necessary to help our member companies swiftly prepare for prompt claim payments and maintain key functions during disasters. We also strengthened our business continuity management plan, which included a review of the substitution functions of our Osaka branch office to ensure a smooth transition of operations in the event of the functions of our Tokyo headquarters being lost due to a Tokyo Inland Earthquake.

　We promoted measures aimed at providing technical assistance to other Asian countries and regions in close cooperation with related domestic and international parties.

　Last September, we hosted an ISJ (Insurance School (Non-Life) of Japan) overseas seminar in Indonesia. The ISJ is a program designed to provide East Asian regions with technical assistance on insurance. To date, approximately 5,000 people have participated in the seminar since it began more than twenty years ago.

　In Myanmar, where we held an ISJ overseas seminar two years ago, we aimed to support to the establishment of an insurance association by holding workshops and seminars in collaboration with relevant organizations. At the establishment ceremony of the Myanmar Insurance Association in January, both associations agreed to conclude a cooperation memorandum confirming to further strengthen our relationship.

　In addition, last November, our association agreed to conclude a cooperation memorandum with the ASEAN Insurance Council (AIC) which comprises 13 member insurance associations from 8 ASEAN member states. In May, the GIAJ also agreed to conclude a cooperation memorandum with the Philippine Insurers and Reinsurers Association (PIRA). Having personally visited the PIRA and encouraged concluding the memorandum I hope to continue working for the benefit of both markets by steadily implementing technical assistance.

　Paying particular attention to regulations that may significantly affect the Japanese general insurance industry, we have made requests and expressed our opinions on international regulatory issues.

　The International Association of Insurance Supervisors (IAIS) has developed Insurance Capital Standard (ICS) Version 2.0 to be applied to Internationally Active Insurance Groups (IAIGs). The GIAJ submitted its comments on the IAIS public consultation, through which we proposed the use of ICS Version 2.0 as a "soft" standard such as a "monitoring measure”, for the time being. In line with our opinion, the IAIS announced that the implementation of ICS Version 2.0 will begin with a five-year "monitoring period".

　With the ongoing globalization of the insurance market, the GIAJ has strengthened cooperation with relevant foreign parties to focus on fulfilling our roles.

　Last September, The IUMI annual conference took place in Tokyo. The IUMI is a marine insurance union that represents insurance associations and other parties across 40 countries and regions. It was the first time in eleven years for the conference to be held in Tokyo since 2006. On the day, around 630 participants from 35 countries and regions took part, and as the host, the GIAJ deepened its relationships with participating marine insurers.

　We also promoted the strengthening of relationships with overseas insurance associations. After acceding to this office at the end of March 2017, I had the opportunity to visit the four insurance associations in the UK, Indonesia, Malaysia, and Thailand. Furthermore, in May, in addition to having visited the PIRA I met with the Chairperson of the Korean General Insurance Association during his visit to Japan. Through each of these occasions, during which meaningful views were exchanged on the conditions and challenges surrounding each market, our good relationships were once again reaffirmed.

　With the aim of helping business operations including insurance solicitation and payment of claims, the GIAJ sets forth industry-wide guidelines for our member companies. Last year, the Financial Services Agency (FSA) issued the "Principles for Customer-Oriented Business Conduct", calling for companies to improve the level of their business operations. Given these circumstances, the GIAJ’s guidelines are becoming increasingly important. As such, we followed up our twelve guidelines related to business conduct by distributing and assessing a questionnaire regarding how members utilize these guidelines and their state of business conduct.

　As a result, we have confirmed that our members are making use of the guidelines for their business operations and have identified practical initiatives unique to each insurer. Feedbacks on the results were provided to each member d to help further improve the level of business conduct.

　Based on the questionnaire results, we will reconsider the adequacy of the guidelines and, where appropriate, make necessary revisions. By implementing a PDCA cycle, we will establish an appropriate follow-up system of guidelines to continue improving the level of our business operations.

　With the aim of promoting high-quality solicitation, we have proceeded with measures to increase the number of "General Insurance Total Planners", our most prestigious qualification for insurance solicitors.

　As a result of our PR activities, the number of certified sales staff has been steadily escalating. The number increased from 9,575 in the end of March 2015 to 12,474 as of the end of March this year.

　The number of applicants for the "Consulting Course" of the "General Insurance College Course", which is required to be certified "General Insurance Total Planner", is also on the rise. The number for this year’s course starting in April hit a record 2,235, up 476 from the previous term. For the purpose of lowering the hurdle to becoming a General Insurance Total Planner, we also decided to reduce the course fee by ten percent. The discount will apply on courses opening after April 2019.

　In order to promote high-quality solicitation, we will proceed with awareness-raising activities and measures to raise the attractiveness of the becoming a "General Insurance Total Planner".

　Along with the growing threat of terrorism across the world, it is becoming increasingly important to prevent money laundering and terrorist financing. The fourth round of FATF AML/CFT Mutual Evaluation is scheduled for next year in Japan. To sustain the soundness of the country's financial system, it is necessary to strengthen the capabilities of the AML/CFT through government-private sector collaboration.

　Under these circumstances, the FSA is taking various measures, including the establishment of the "Planning Office of Anti-Money Laundering and Combating the Financing of Terrorism" and the publication of "Guidelines for Anti-Money Laundering and Combating the Financing of Terrorism". Individual financial institutions are also required to build robust management systems. In order to achieve this, the GIAJ formed a project team with the aim of strengthening cooperation with the FSA and other relevant authorities, providing information to our member companies, and supporting our member companies' compliance with the guidelines. Through these efforts, we will continue to promote the strengthening of our member companies' AML/CFT management systems.

　In Japan, improving the labor force participation rate and enhancing productivity by taking advantage of technological innovations are high social priorities as the working-age population continues to decline. On the other hand, negative aspects of technological innovations such as cyber risks are emerging, as illustrated by last year's worldwide cyber attacks. Measures against natural disasters also require heightened attention as earthquakes continue to rock the country after the 2016 Kumamoto Earthquake and downpours such as the 2017 Kyushu rain become more localized, extensive, and torrential.

　As I described in my Inaugural Statement last June, the general insurance industry has grown steadily by moving in step with ongoing changes in society. From the standpoint of risk professionals, we will continue to work to maintain sustainable growth together with society by endeavoring to correctly perceive changes and challenges within it, and by contributing to building a worry-free, safe society.

　My tenure as Chairman of the association began in a landmark year marked by the GIAJ's 100th anniversary. Since then, we have made steady progress with our initiatives, and, thanks to your support, I was able to carry through my responsibilities successfully. Again, on behalf of the GIAJ, I would like to express our hearty gratitude.

　Going forward, I ask for your continued understanding and cooperation which are both greatly appreciated.
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