Annual Report 2009

Shunichiro YasutaChairman of the Supervisory Board3ANNUAL REPORT 2009Kazumi ImaoPresident of the Board of DirectorsMESSAGE FROM THE MANAGEMENTtype of Family Automobile Insurance policy with full safeguards and concise terms. Finally, in April 2009 we responded to our policyholders’ rising need for wealth-building by raising the entry age limit and maximum insurance amount for savings-type Whole Life Insurance policies. In April 2010, new insurance legislation will go into force aimed at strengthening protection for insurance policyholders by upholding their contractual rights. In addition to revising the terms and conditions of its insurance policies in compliance with the new legal ground rules, Zenkyoren will also be adopting a proactive response to this change by taking various measures to improve customer satisfaction. These measures will include speeding up payment procedures, simplifying insurance products and making insurance clauses easier to understand, and providing customers with improved explanations of insurance products through the distribution of pamphlets and other materials.We will continue striving to understand our customers’ wide range of insurance-related needs so as to provide even more individually-tailored comprehensive life security plans. This will further strengthen ties with JA and members/customers, and will help to attract new partners . Securing Financial Soundness and Ensuring TrustworthinessRegarding our investment activity during the reporting term, in view of our responsibility to provide a liability reserve for the future payment of insurance coverage, we follow a policy of ensuring stable, long-term earnings to ensure our ability to pay all insurance coverage required under any conditions. Zenkyoren’s investments therefore center on yen-denominated bonds linked to the levels of interest rates in Japan, such as government/corporate bonds, and loans to blue-chip companies. At the same time, we also make investments in equities and in foreign currency-denominated bonds in a cautious investment stance, as a means of raising our total earnings. Fiscal 2008 saw stock prices plunge in response to the worldwide economic downturn triggered by the global financial crisis, while the yen appreciated against other major currencies. However, Zenkyoren’s solvency margin, a key indicator of corporate financial soundness, recorded a slight decline to 860.4% from the previous term’s 879.1%, giving us a sufficient level for the future payment obligations.During fiscal 2009, Zenkyoren’s investments will continue to be focused on trustworthy yen-denominated financial products such as Japanese Government Bonds, and we will take a cautious stance to secure stable returns on our investments in equities and foreign currency-denominated bonds. In this way, we aim to realize sound and secure management while maintaining adequate financial soundness.* Please note that a simple comparison of this figure with the corresponding indicator for Japanese life and non-life insurance companies is not possible due to differences in the scope of business.