[English Translation] November 25, 2005 MSI Received Business Improvement Order from FSAJ Mitsui Sumitomo Insurance Co., Ltd. (thereafter “MSI”) received a note of administrative disposition, in a form of business improvement order, from the Financial Services Agency of Japan (thereafter “FSAJ”) on November 25. The FSAJ issued the order based on the Insurance Business Law, pointing out that our administration performance is not satisfactory enough in terms of peripheral expenses and others incurred associated with reported accidents which are to be reimbursed under policy in claim handlings. We take it seriously and deeply apologize to policyholders and other people concerned over the trouble. 1. Summary of the administrative disposition (1) In accordance with Article 132, Provision 1 of the Insurance Business Law, the business improvement order calls for the following four points; (i) to improve and strengthen the concerned administrative system and prevent recurrence in respect of peripheral portion of reimbursement,   (ii) to review and take necessary and suitable amendments in explanation of insurance to policyholders, including pamphlets, invoices and other written forms,   (iii) to build up an inter-sectional cooperation platform among departments to be involved in a phase of new product development, such as the product designing, claim handlings and computer system functions,   and     (iv) to review and refine those system programs, forms of tickets and vouchers, contents of internal rules and manual books of the administrative procedures and other items which are concerned in the failures, and prepare an educational program and/or training session to the people in the claim handlings in order to follow thus revised procedures properly. (2) The reasons given for the disposition are as follows: (i) There are a large number of failures to pay out peripheral portion due, processing claims without following applicable prescription of the operation procedure book and the general policy provisions in reimbursement.   (ii) Due to inadequate recognition of necessity of organizational preparation for the operation of peripheral portion of reimbursement, the actions taken in preparation for it in the reimbursement are also inadequate.   (iii) Due to unsatisfactory preparation in the reimbursement procedures, etc. and without full understanding and correct knowledge of the concerned products shared by all staff in respect of peripheral portion of reimbursement, the claim handling process and the checking system are not established well enough.   (iv) In the concerned product development phases, cooperation was not formed effective enough to prevent the peripheral portion from reimbursement failure by the departments involved.   (v) The failures were caused by inadequate preparedness which is found continuously ranging from the product development to the reimbursement administration, and resulted from a structural problem of the malfunctioning operational management and internal control. 2. Actions to take in response (1) After cases of reimbursement still remaining partially due were found, we have been taking necessary measures to improve the reimbursement administration. However, taking this opportunity, we rethink a sting of the incidents sincerely and reconfirm that we all, whether officer or employee, strive to eliminate recurrence possibility and thereby restore the trust from policyholders and people concerned as early as possible. (2) In accordance with the business improvement order, we will formulate a comprehensive business improvement plan for recurrence prevention, submit it to the FSAJ, and then regularly report to the agency its procession, actions and status till the end of the plan. Upon the disposition, we at MSI are re-determined to ensure equitable and fair business conducts. And your support and advice as encouraging as ever would be highly appreciated.