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| MS Quarterly News (1st Quarter, 2006) |
Mitsui Sumitomo Insurance Co., Ltd. ("MSI") hereby issues a quarterly newsletter containing a summary of the topics for the first quarter, fiscal 2006, from April to June, as set forth below.
MSI received, from the Financial Services Agency of Japan on June 21st, 2006, an order for partial suspension of business as well as remedial action order for business, pursuant to Article 133 and Article 132, paragraph 1 of the Insurance Business Law, respectively. We deeply regret causing such a situation in the insurance business industry where highly ethical behavior is expected. We would like to express our sincere apologies to our policyholders and related parties for any significant inconvenience.
We all members of MSI take the orders serious, and sincerely wish to prevent the recurrence of a similar situation and restore the confidence in us. |
(preliminary for the quarter from April to June 2006, with long term medical insurance included in Personal Accident and Total accounts)
Total premium revenues grew 3.0 percent on a year-on-year basis for the first quarter of this fiscal year, continuing the growth trend since the second half of the previous fiscal year. All the lines of insurance marked rises repectively, and the increase amounted to Y10.1 bn in the aggregate, with.
In terms of lines, damage liability and hull insurances kept growing at a high pace, particularly in the corporate accounts, thanks to the current economic uptrend, as well as personal accident insurance sold well, mainly to individuals in the workplace market. |
| Lines of insurance |
Premiums (sales basis) (in million yen) |
Year-on-year growth rate (%) |
| Voluntary Automobile |
151,476 |
0.3 |
| CALI* |
42,111 |
2.7 |
| Fire |
51,421 |
3.5 |
| Personal Accident |
30,287 |
6.4 |
| Miscellaneous |
51,122 |
5.2 |
| Cargo and Transit |
17,018 |
5.4 |
| Hull |
9,063 |
21.0 |
| Total |
352,499 |
3.0 |
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| *compulsory automobile liability insurance |
Selected News Releases (Apr - Jun 2006) |
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| announced on the respective days in parenthesis |
| (1) |
Products and Services |
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Automobile insurance made easy to understand (Apr. 21) |
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The revised automobile insurance policy, designed easy to understand, will be available effective August 1st, 2006. In addition, new services, including lawyer's support in an accident which the second party is liable for, will be provided to make the insurance more attractive. The offering brochure has also been totally renewed to make it easy to follow, with pages changed into landscape format and guiding readers in a picture-story-show like manner. This is the first brochure in the industry that "SP code" is applied for so that those elderly or visually disabled people who are policyholders or parties involved in accidents can listen to the voice-recorded text.
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IRR offers "consultation for improving internal control system" (May 8) |
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Inter-Risk Research Institute & Consulting Inc. ("IRR"), a unit of the MSI group, has started offering "consultation for improving internal control system," which is a new service for corporate clients to help them build up an internal control system and ensure appropriate operational practices in place.
Based on its expertise having accumulated in the consultation services of such areas as risk management, emergency management, corporate social liability performance, its service menu offers seven lineups including "seminar on internal control" and "consultation for building up an emergency management system" from the viewpoints of building up a system for internal control in accordance with the requirements in the newly enforced Corporate Law, the Financial Instrument Trading bill (or so-called "J-SOX law") under deliberation and others.
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Commercial credit insurance for MSEs revised (May 11) |
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MSI revised the terms and conditions of commercial credit insurance for medium- und small-sized enterprises ("MSEs") and put it in force effective June 1st. The revision includes "raising up the coverage ceiling," "launching a premium discount program" (under which premiums may be discounted to the maximum of 30 percent of the current level) and "underwriting credit risk in any line of business."
MSI had pioneered the market of commercial credit insurance for MSEs for the first time in the industry in September 2004 and has successfully increased the business since then. This revision facilitates that this insurance product meets better MSEs' needs to control credit risks to their trading counterparties, and thereby increases its attractiveness.
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MSI's defined contribution operation takes part in servicing organ (May 17) |
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MSI has participated in a servicing organ of the defined contribution (401(k)) pension programs and launched, June 2006, the new package of "MSI JIP General-type 401(k) Plan," in which several applicant companies are engaged under the single and common pension servicing agreement.
Japan Pension Navigator Co., Ltd., a joint venture of the Mitsui Sumitomo financial group members, had been proposed to customers as a servicer until then. However, to those MSEs which intend to adopt a defined contribution pension program from now on, a service of better quality will be available at more reasonably priced under MSI's own management throughout from the proposal stage to the servicing stage after the program adopted.
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Weather derivative instrument for typhoon risk hedge on sale (May 22) |
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"Typhoon Preparation" for the 2006 season is now on sale. This weather derivative product is offered to those companies which intend to hedge the risk that revenues will likely be forced to fall due to typhoons. Typhoon Preparation pays a certain amount of funds to a company, according to the number of eyes of typhoons which will have passed through a zone previously specified (within a circle with a radius of specific distance from the designated point). The premium table for this season is set to range "from Y500,000 and go up in increments of Y100,000" in order to flexibly respond to customers' budget, and it is thereby made more convenient. The product is now on sale, targeting those companies which need to mitigate such risks in the typhoon season.
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IRR's 2006 analysis on risk-related disclosure in securities reports (Jun 8) |
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IRR, a member firm of the MSI group, analyzed the "risk-related information" parts disclosed in those yukashoken-hokokusho reports (Japanese counterpart of form 10-k) which were prepared as of the closing dates falling within 2005 by major Japanese corporations, and compiled a report.
The latest analysis presents issues regarding what and how Japanese corporations should disclose in respect of risk-related information, pointing out some cases, for example, of insufficient disclosure in terms of quality, quantity and scope. Amid the increasing necessity of risk management, for example, as companies are required to build up an internal control system by the Corporate Law newly enforced on May 1st, they need more efforts to ensure improvement of internal control.
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MSIVC's mergers and acquisition fund invested in the first deal (Jun 13) |
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Mitsui Sumitomo Insurance Venture Capital Co., Ltd. ("MSIVC"), a venture capital unit of the MSI group, invested through the account of "MSIVC Buyout Investment Limited Liability Partnership," a fund established to invest jointly in buyouts (where the management of a target business purchases the said business) in its first joint deal
This particular transaction was invested jointly with JBF Partners, an independent investment fund. MSIVC will not only assist JBF in its activity as joint investor but commit itself to increasing corporate value of the purchased business.
MSI and MSIVC will cooperate with external funds to select excellent targets in the buyout investment.
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| (2) |
Life Insurance |
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MS MetLife launched guaranteed whole life variable annuity (May 1 and Jun 5) |
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Mitsui Sumitomo MetLife Insurance Co., Ltd. ("MS MetLife") commenced the over-the-counter sale of the variable annuity insurance for individuals with a rider of guaranteed whole life insurance in the segregated account at the Biwako Bank Limited and the Hokuriku Bank, Ltd. on May 1st and June 5th, respectively.
In this type of variable annuity insurance, its future annuity and reimbursement amounts will likely vary, deviating upwards or downwards, according to return on investment in the segregated account.
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Social Contribution Activities |
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4th lecture given in Citizens' Environmental Course (May 16) |
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The fourth lecture titled "Sharing Ideas on Environment and Afforestation" of the Citizens' Environmental Course was given open to public audience, mainly targeting residents in the neighborhood of the MSI Surugadai Building and people interested in urban greenery activities. This lecture set a theme of "restoring, caring, and utilizing greenery in Tokyo," which was extracted from the new strategic program in the environmental administration by the Tokyo Metropolis Government, and a speaker was invited from the Bureau of Environment of the metropolitan government.
MSI would like to continuously have opportunities to think and make actions together with public, particularly the community in its neighborhood, and hold lectures as one of such communication opportunities.
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MSI set up "I-stop Campaign" for safe driving in CSR activities (May 25) |
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MSI has launched the "I-stop* Campaign" to remind the public of "must-stop-look-and-go" when driving a car.
As an insurance company, MSI takes it as one of its social missions to develop activities for prevention of traffic accidents and puts it under the scope of its social responsible practices. In this fiscal year, employees and agents alike at the MSI group are taking part in the I-stop Campaign to reduce traffic accidents.
* It is named in the double meaning of "ichiji teishi" in Japanese and "I stop" by MSI.
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Disaster relief donation made to Central Java Earthquake victims (Jun 6) |
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For the purpose of offering aids to victims suffered from and local communities devastated by the earthquake in the central Java island, Indonesia, about ten million yen was donated in the aggregate of charitable collection* from about 14,000 MSI employees within Japan and donations from MSIG Holdings (Asia) and P.T. Asuransi Mitsui Sumitomo Indonesia, which are the Asian regional headquarters and a subsidiary in Indonesia of MSI, respectively.
* It includes a corporate portion donated in accordance with the internal collection program, "Disaster Relief Matching Gift Program," under which MSI, for its corporate account, agrees to make a contribution of the same amount of funds with the total of those offered personally by its employees. |
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Women's Judo |
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All Japan Woman Selection Weight Judo Championships (Apr 9)
Masae Ueno (70kg-class), Rie Iwafuji (57kg-class) and Emi Yamagishi (48kg-class) won the titles, respectively. And Masae Ueno, Yuki Yokosawa (52kg- class), Yoshie Ueno (63kg-class) and Emi Yamagishi were later named to the national squad for the world cup team championship games.
56th All Japan Corporate Team Judo Championships (Jun 3)
MSI team cruised to its fourth victory following the previous year. Yuki Yokosawa was voted Most Valuable Player. |
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