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Taking into consideration issues such as our quickly aging society and the increasing social security costs associated with this aging population, life insurance is indispensible and will become more and more important to our long-living society. According to a survey conducted by the Japan Institute of Life Insurance, when asked whether they “intend to financially prepare for life protection”, approximately 70 percent of the respondents affirmed they did for post-retirement benefits and nursing care coverage, and approximately 60 percent for medical care coverage and death benefits.
The year 2009 marks the Life Insurance Association of Japan’s 101st anniversary. Taking account of this remarkable milestone, we would like to return to our original principle: to fully meet the expectations of the public and to continue “progressing forward alongside customers and guaranteeing whole life protection”.
In view of this, we plan to focus on the following three issues:
1. Enhancing the public’s trust in the life insurance industry
In order to fulfil our mission to protect people’s lives and provide long lasting support for the aging society in Japan, it is of vital importance that the life insurance industry ensures the soundness of its business and further enhances the public’s trust in the industry.
Due to the global financial crisis which started last year, the environment surrounding the life insurance industry has changed significantly, however our member companies strived continuously to enhance their financial soundness and maintain prudent management. We at the LIAJ, needless to say, completely support their commitment in this regard.
In addition to the above, we will make our best efforts to ensure customers’ thorough protection and continuously improve the value of our services in order to further enhance the public’s trust in the life insurance industry. Regarding the issue of appropriate insurance payouts, which is an essential part of our business, the LIAJ has undertaken various important projects. In order to ensure customers’ needs are reflected in each member company’s management policy, these projects include developing and reviewing the relative guidelines and promoting the use of digitalized medical certificates with a target of introducing them to 1000 hospitals. Moreover, it is the LIAJ’s intention to continue to strengthen a nationwide system to collect customers’ comments and requests and by relaying this feedback to our member companies, we proactively contribute to the further improvement of service levels to customers and member companies’ better management.
Furthermore, regarding the enforcement of the revised Insurance Contract Law on April 1st 2010, the LIAJ is constantly providing practical support for our members to deal with these changes and also making sure their business activities are even more customer-orientated, in line with the enforcement. Secondly, we strive to widely inform the public of the implications of the Law and its newly revised contents.
The LIAJ has also established the Arbitration Council as an Alternative Dispute Resolution body and has strived to enhance its dispute resolution function. Specifically, in order to attain the further transparency, neutrality and effectiveness of the body, we voluntarily made efforts to ensure each member company’s participation and complete respect of the Council’s decision. We will also strive to work in accordance with the new financial ADR framework which has been created in the partially amended Financial Instruments and Exchange Act.
2. Ensuring an appropriate business environment for life insurance
We need to secure an appropriate business environment so that life insurance can function as part of the social infrastructure to support people’s lives.
At present, the IASB is planning to introduce fair value measurements for insurance liabilities. We will make sure all parties concerned have the proper understanding to evaluate the business accounting as well as appropriately reflecting fair value accounting measurements in insurance companies’ business results.
Aside from this, there have been some requests to increase the underwriting limits for products and also to add some new products onto the product line from Japan Post Insurance. We believe that a level playing field among all insurance companies is an essential part of the preconditioned stable privatization process for Japan Post Insurance, in line with the objectives of the Postal Service Privatization Act. In addition, in order to ensure better customer protection, it is indispensible for Japan Post Insurance to establish appropriate systems for underwriting and insurance payouts. We the LIAJ will continuously appeal to all parties involved in these respects.
3. Expanding the social role of the life insurance business
The social role of private protection, sustained by the public’s individual efforts, will become more and more important in the future.
Regarding the tax-exemption scheme of life insurance premiums, it was decided by the Government in its “Outline of Tax Revision” last year to raise the tax-exemption limits for life insurance premiums. Taking this opportunity, we at the LIAJ will encourage all parties concerned to make this new tax-exemption scheme simple and easy for customers to use, and also to endeavour to further enhance the private protection of individuals.
Furthermore, as part of our social responsibilities for the declining birth rate and the aging population, we continuously promote our commitment to the following projects: to sponsor scholarships for the training of nursing care workers; to financially aid non-profit organizations which support families with small children; to continue with our family bonding promotional activities to encourage parents to read picture books with their children; and finally to make efforts to address both issues of swine influenza and environmental concerns such as CO2 reduction.
As I take over the role of Chairman of the LIAJ, I would like to conclude my remarks by emphasising my determination to ensure our upmost efforts to deal with all the issues the LIAJ is now facing, in order to fulfil our mission of “progressing forward alongside customers and guaranteeing whole life protection.” We would most appreciate your continued support and cooperation.
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