Mitsui Sumitomo Insurance

April 7, 2005

MS Quarterly News (4th Quarter, 2004)

We, Mitsui Sumitomo Insurance Co., Ltd. ("MSI"), are pleased to issue a quarterly newsletter with a summary of the topics during the fourth quarter ended March 31st, 2005, as set below.

Performance

	Q4, fiscal 2004 (Jan to Mar. '05)		Fiscal year to date (Apr. '04 to Mar. '05)
Lines of insurance	Premiums (sales basis) (in million yen)	Growth rate (%)*	Premiums (sales basis) (in million yen)	Growth rate (%)*
Voluntary Automobile	134,845	-0.1	566,171	-1.3
CALI**	42,976	1.5	156,336	2.0
Fire	46,821	-3.7	193,832	3.8
Personal Accident	31,211	16.5	120,218	10.1
Miscellaneous	34,906	-3.3	161,375	4.0
Cargo and Transit	14,627	5.1	60,236	7.5
Hull	4,340	13.7	20,844	1.3
Total	309,726	1.0	1,279,011	1.9

*The "growth rate" represents an incremental rate in comparison to the same period in fiscal 2003.
**CALI: Compulsory Automobile Liability Insurance

<Comments>
The fourth quarter saw steady demands in the categories of CALI, personal accident, cargo and transit and hull, resulting in a 1.0% growth in total premium revenues. For the fiscal year through March, total premium revenues increased 1.9%. In the fire insurance, the core product, Home Pika-ichi, which covers natural disaster risk as well, and earthquake insurance gave a momentum to the good run in sales. In the personal accident, ViV Shusin and overseas travel accident gave a solid base for the sales growth. In the miscellaneous and hull, contracts written increased in corporate business.

Selected News Releases (Jan - Mar 2005)

announced on the date in parenthesis

(1)	New Products and Services
	*	Transportation compensation liability insurance "Unbai Anshin Delivery" launched (Jan 7)
		Transportation compensation liability insurance, which covers compensation made by a transporter of cargo to its owner in case of damage on it during transportation, was revised as "Unbai Anshin Delivery" to be launched on February 1. The renewed insurance offers four insurance choices and about 500 combinations of compensation limit and amount of customer's own burden, enabling customers to choose an insurance amount best suited to their needs.
	*	Internet-based risk consultation service "u-LOCS" for domestic transportation and delivery business now on sale (Jan 17)
		Effective November 11, "Business One - new packaged distribution insurance" was launched for small and medium-sized enterprises ("SME"). This transportation insurance was targeted to the companies in size of annual sales less than five billion yen, and it alone covers the risks of damages on goods in the entire process from delivery of procurement through warehousing and processing to shop shelf for sale. Developed by drawing on our wealth of underwriting know-how, it made possible to offer higher level risk coverage at about 20% discount compared with the conventional one.
	*	Weather derivatives product, "Harusame Yojin" brought on market (Jan 31)
		A ready-made spring weather derivatives product was on sale from January 28^th to March 18^th. The product named "Harusame Yojin" was designed against rain fall as a trigger, targeting a variety of companies such as leisure, restaurant and retail business which are vulnerable to rainy weather. After the recent years of unusual weathers in Japan as 2003 experienced a chilly summer and warm winter, in 2004 suffered from an intensely headed summer and torrential rains, the weather derivatives are increasingly drawing more attention of customers.
	*	Open seminar "Great Earthquake and BCM" held (Feb 2)
		Inter-Risk Research Institute & Consulting Inc. ("IRR"), a risk management arm of the MSI group, sponsored together with the all members of BCI Japan Alliance and MSI an open seminar about business continuation management (BCM) in case of a heavy earthquake. The seminar titled "Great Earthquake and BCM - lessons to be learned from the Hanshin Awaji and Niigata Chuetsu Earthquakes" was held on February 16^th. It showed an example of business continuation plan (BCP) by taking one made for the Tokyo Stock Exchange, and referred to actual damages at companies suffered in the Hanshin Awagji and Niigata Chuetsu Earthquakes to draw lessons from them as well as advise protective actions and countermeasures against such possible damages to the audience.
	*	Telemarketing Center opened dedicated for outbound calls (Feb 3)
		"Telemarketing Center" opened in April 2005 to help automobile insurance agents access new individual customers. Amid slowing premium revenues from automobile insurance, this center will, instead of agents, make outbound calls to their potential agents based on potential customer information held by them. It will facilitate access particularly to those potential customers who are located outside the agents' easy access in geographical and time wise in order to solicit insurance to them or collect information on them.
	*	"Risk Sensitivity Improvement" consultation given to municipal staff (Feb 9)
		IRR developed a risk sensitivity test focusing mainly on municipal staff. This test contains questions, for example, "How do you perceive risks in your daily work?" "Can you take proper and necessary actions on occurrence of scandal?" This was the first one made in the industry, and has become available in a package of training and consultation services to municipals nationwide since April. With applying the service to its staff, the municipal can measure risk sensitivity of the individuals or the entire organization. And a further comparison can be made among departments within a municipal or among municipals when applied to them.
	*	"Current Logistics in China" CD-ROMs updated for free delivery (Mar 4)
		The 3-CD-ROM sets of information about China's current logistics and infrastructure was edited and delivered to corporate customers free of charge on March 1^st and thereafter. The set focuses on the three northern to southern seashore regions where most of Japanese corporate entrants are located and to which many Japanese pay keen attention. It contains surveys made by the MSI staff in the regions, and describes information about infrastructure such as harbors and inland transportations in detail.
	*	"New Modorich" car insurance with maturity refund launched (Mar 9)
		"Modorich" is a comprehensive automobile insurance for family use drivers, featuring certain refund at maturity, and "New Modorich," its upgraded modification, was launched on April 1^st. New Modorich has two more features in addition to that of the conventional type; First, its refund rate at maturity is raised for non-accident drivers higher than that of the conventional one-year policy to make it more attractive. Second, the packed service of "QQ Vehicle Rescue Crew" is also upgraded for those insured of "MOST Family" type who have optioned Modorich.
	*	"New Business Pika-ichi" fire insurance released for SMEs (Mar 18)
		"Business Pika-ichi," high-end product of fire insurance for SMEs, boasts of top-class annual sale of five billion yen made of 60,000 policies. Now it has been renewed as "New Business Pika-ichi" and will be launched on June 1^st. This renewal features, for example, designing for an increased variety of target industries, setting newly a rider to meet customers' needs more precisely, introducing a new discount system and introducing provisions considering facilitation of a community alliance or industrial-academy tie-up. These are all new to be implemented, not contained in the conventional type.
	*	"Environmental Contamination Related Service" started for entrants in China (Mar 24)
		MSI and IRR, its risk management unit, started providing Japanese corporate entrants in China with local environment-related legal and regulatory data as full-scale services. These services include a free environmental brochure, "New Eternal," containing explanations on China's legislation, characteristics of laws and regulations, summary of major applicable laws in the environmental area. Moreover, specific onerous service will be offered to provide information about not only applicable national laws and regulations but those on provincial or city level, as well as summary of issues to be discussed for building and operating a plant.
	*	Savings-type insurance for condo owners' association released (Mar 28)
		A savings-type fire insurance to cover risks associated with common elements of a condominium was launched in April. Named "Saving-type Home Life Comprehensive Insurance (Plan for Condominium Owners' Association)," it offers a broader range of compensation and providing funds for future repair and renovation expenses. Condo owners' associations who consider diversified investment of such funds due to the "pay-off" or removal of deposit protection effective this April may choose to shift some portion from deposit to this insurance as one of investment vehicles.
(2)	Life Insurance, New Businesses, Alliances and Overseas Operations
	*	MSI preparing for reverse mortgage in service (Jan 11)
		The Chuo Mitsui Trust and Banking Corporation, Limited and MSI has jointly begun to prepare to handle "reverse mortgage" and developed a scheme incorporating insurance.Reverse mortgage is a kind of mortgage loan designed for elderly homeowners in which transaction a borrower borrows periodically expense for the rest of life by providing his/her home as security.This is the first reverse mortgage scheme by a coalition of bank and insurer in Japan.
	*	MSI Citi launched "Athena" foreign currency annuity insurance (Jan 11)
		Mitsui Sumitomo CitiInsurance Life Insurance Co., Ltd. started selling "Athena" foreign currency denominated annuity insurance on January 25^th. Athena fixes the principal amount of future annuity payments in a foreign currency on the purchase point. By providing two optional currencies of U.S. dollar and Australian dollar and term setting spanning at least three years, it responds to customers' widely ranging needs such as stable investment performance of annuity insurance, benefit from foreign currency's comparatively higher current interest rates and relatively shorter grace period to receive annuity payment.
	*	Four Sumitomo financials to establish management forum (Feb 24)
		Sumitomo Mitsui Banking Corporation, Sumitomo Trust & Banking Co., Ltd., Sumitomo Life Insurance Company and MSI decided to create "Sumitomo Management Technology Forum" to bring an innovation in management and establish new management standards for the 21^st century. "Management technology" hereby means a methodology of instruments collectively which, by adopting logical, systematic and quantitative concepts and measures in management, brings out scientific and global analysis on various factors of management and envisages present management performance, and thereby facilitates top management and high rank officers to share and inherit the idea of management improvement and thus bettered management for further enhancement. The members of the Sumitomo group, including these four, will invite other companies based in the Kansai region, the origin place of the Sumitomo group, to build "Sumitomo Management Technology Forum." We will also seek collaboration from Oska University and ask for co-sponsorship from Kansai Economic Federation, Kansai Association of Corporate Executives and the Osaka Chamber of Commerce and Industry. Backed by these aids, we would like to make efforts to study new management standards for the 21^st century and share them with all participants.
	*	S&P rated MS Kirameki AA- (Feb 25)
		Mitsui Sumitomo Kirameki Life Insurance Company, Limited was first time rated by Standard & Poor's as AA- for its insurance financial strength and long-term counterparty, with "stable" for its outlook.
	*	First phase of acquisition of Aviva's non-life operation in Asia completed (March 1)
		Following the agreement made with Aviva of the UK on September 7, 2004, the first phase of the acquisition process was completed. This phase include operations at non-life subsidiaries in Singapore, Hong Kong and Thailand and controlling entity in Singapore, accounting for about 70% of the whole acquisition operation in terms of premium revenues. The rest of the acquired operations will be transferred from time to time as requirements of local authorities for the transfers are satisfied.
(3)	Environmental and Social Contribution Activities
	*	MSI group donated for Indian Ocean Tsunami (Jan 14)
		The Indian Ocean Tsunami and Off-Sumatran Coast Earthquake took place on December 26, 2004. For extending some assistance to the people and local communities suffering from the damages, the funds totaling to 40 million yen, consisting of donations by about 20,000 people working within the MSI group inside and outside Japan as well as those made by the MSI member companies across the world, were contributed to a certain charity body.
	*	Kobe MSA made donation at "Earthquake Charity Campaign 2004" ceremony (Jan 14)
		An organization made of MSI's agents, Kobe MSA, ran the "Earthquake Charity Campaign 2004" from June to November 2004. Under the program, a certain amount, based on the number of new earthquake policies written, would be donated to the Hanshin Awaji Great Earthquake Reconstruction Foundation. As a result, 627 new policies were written, and the campaign pushed up the in-force amount by five percent in earthquake insurance business at Kobe Branch as well as worked as a good impetus to earthquake insurance permeation. Taking the opportunity of its general meeting held on January 18, Kobe MSA held a ceremony for the tenth annual memorial of the earthquake, reported the results of the campaign to its members and handed over the 180,000 yen donation to an invited representative of the foundation.
	*	MSI Implementing Tropical Reforestation Project in Indonesia
		In line with its policy of corporate social responsibility (CSR) activities, MSI initiated a project for regenerating a tropical forest in April 2005 in order to work as part of counteractions against tropical forest shrinkage, one of global environmental issues. The project is now conducted jointly with the Bureau of Forest Protection and Nature Conservation of Indonesia's Ministry of Forestry under a collaborative guidance from Sumitomo Forestry Co. Ltd., and the first joint reforestation program for the bureau to undertake together with a Japanese private corporation. The site is a nature reserve forest devastated due to illegal deforestation. The project involves people in the local community, and is planting 260,000 plants, consisting of plants indigenous to the country, trees usable as timber and fruit trees for six years. It aims at not only restoring forestal functions such as preventing natural disasters, reserving ground water and sheltering animals. But it also seeks for a sort of sustainable "forestry regeneration" where the community would thrive without deforestation and enjoy symbiotic life.
	*	MSI Pop Music Clubopened tenth Valentine's charity concert (Feb 18)
		MSI Pop Music Clubhave had the annual "St. Valentine's Charity concert" since 1996, and contributed the proceeds from tickets added to donations sent from MSI people nationwide to a non-political organization ("NPO"), "Minsai Center Japan" for its "Darunee Scholorship," which has been awarded to some children from rural areas in the northeastern part of Thailand. It costs 30,000 yen for a child to graduate junior high school. This year's concert was the tenth anniversary one, and graduates who received the scholarship were invited there from Thailand to listen to a speech and enjoy playing music together. The aggregate of the ten donations sent to Thailand in the past amounts to slightly over two and a half million yen, and has financially assisted 85 children in graduating junior high school.
	*	"Workers'Excellent Volunteer Service Prize" (Feb 28)
		MSI was honored to received"Excellent Support Prize under the Worker's Excellent Volunteer Service Prize" because of its assistance extended to NPOs in activating their social contribution activities. The prize was created by the Workers' Multi-life Support Centerof the Sawayaka Welfare Foundation, and awarded to corporate entities or their offices which support their people's volunteer activities, provide circumstances that facilitate such activities or positively make the whole organization involved in social contribution activities. MSI was awarded for its activities made in Aichi prefecture.
	*	MSI Culture Foundation decided venues of "Concert for Local Community" and winner of "International Cultural Exchange Subsidy" for fiscal 2005 (Mar 8)
		Mitsui Sumitomo Insurance Culture Foundation, a social contribution organization of the MSI group, decided on municipals or municipal halls which co-sponsor "Concert for Local Community" and selected 11 amateur bodies as receivers of "Cross-cultural Activity Subsidy" for fiscal 2005. The foundation subsidizes cultural activities in the fields of music and folklore stage performances to foster local cultures, promote international cultural exchanges and give a contribution to enrich and develop Japanese culture.
(4)	Others
	*	20,000 MSI people chatting on intranet to exchange information (Jan 5)
		To prevail and raise CSR-awareness companywide, a corner "Let's talk about CSR" was created within the information exchange system constructed on the intranet for all staff, and the service started in January. Subdivided into eight categories made of seven for seven sorts of stakeholders such as policyholders and shareholders and one for CSR in general, there are MSI people's freely written experiences of CSR-orientated actions and proposal of CSR-based improvements. By writing and browsing these messages, we will increase communication to share information and actual cases and encourage discussion among ourselves.
	*	Website for corporate clients totally renewed (Mar 23)
		Following the full renewal of the pages for individual customers made last year, pages for corporate clients were also totally renewed and reopened on March 18. For this revision, corporate clients' behaviors had been analyzed in detail to reconstruct the new pages. As a result, while more products for SMEs and owners of sole proprietorship are displayed with more detail explanation on them, products and services related to risk management were added to them. For higher convenience to corporate clients, a function is provided for brochure request.

Amateur Sports

	*	Women's Judo
		"EJU Super World Cup Sen 2005, Paris "FRA(Paris, France Feb 5-6) Masae Ueno (70kg-class) won the silver medal.Yoshie Ueno (63kg-class) made four ippon victories out of her five games to be the gold medalist.Rie Iwafuji (57kg-class) was defeated in her second game. "EJU Super World Cup Sen 2005,Hamburg GER" (Hamburg, Germany Feb 19-20) Yuki Yokosawa (52kg-class) was the second winner.The semi-final game was not a easy one for she hardly managed to tackle for throwing.At the last ten seconds to go, she made a successful throw of seoinage and pressed down her opponent for an ippon victory.In the final, she positively kept trying to make a trick on the opponent who skillfully escaped, and Yokosawa lost the game. "EJU Super World Cup Men & Woman,Prague CZE"(Prague, Czech Rep., Mar 12-13) Hitomi Tokuhisa (63kg-class) advanced to the first prize, beating her opponent in every game by ippon.Emi Yamagishi (48kg-class) also won the gold medal, showing her distinctive prompt style.
	*	Women's Marathon and Track
		2005 Osaka International Women's Marathon 2005 (Osaka Prefecture, Japan Jan 30) Miki Oyama participated in the race.She was among the group following Ominami of UFJ Bank who dashed just before the 11km point.Past the mid point, Oyama kept her persistent running style to the goal, finishing fourth with her best record shortened by 1m 3s. 2005 Nagoya International Women's Marathon (Aichi Prefecture, Japan Mar 13) Yoko Shibui took part in the race, and led off the runners from the early stage to past the 33km point. But she finished seventh for she was not in her best conditions. Matsue Ladys' Half Marathon (Shimane Prefecture, Japan Mar 20) Tosa, Ohira and Ishiyama joined in the race. Ohira dashed immediately after the start and kept the good pace to the goal. She finished first, leaving the second over 30 seconds behind her. This first prize is her second consecutive one in this race, which is the first achievement made by a runner in this race. Tosa, invited as a special runner, finished nineth. Ishiyama ran through in spite of her pain on Achille's tendon, encouraged by cheers along the street.