24 September 2009

SOMPO JAPAN INSURANCE INC.

Associate Director

Corporate Social Responsibility Office

Masao Seki

Acting on Climate Change in Asia

2nd Conference of the OECD International Networkon the Financial Management of Large-sale Catastrophes

Session Ⅰ　Ｓｅｃｏｎｄ　ｐａｒｔ

2

　In 2004, 10 Typhoons Hit Japan

Source: Japan Meteorological Agency

3

Top-10 Claims for Typhoons and Other Weather-related Disasters in Japan

Source: The General Insurance Association of Japan

(million $)

Name of Disaster (year) Claims Paid

1 Typhoon No.19 (1991) 5,679

2 Typhoon No.18 (2004) 3,874

3 Typhoon No.18 (1999) 3,147

4 Typhoon No.7 (1998) 1,600

5 Typhoon No.23 (2004) 1,380

6 Typhoon No.13 (2006) 1,320

7 Typhoon No.16 (2004) 1,210

8 Downpour (2000) 1,030

9 Typhoon No.13 (1993) 977

10 Hailstorm (2000) 700

Insurance payments for fire and miscellaneous, automobile, marine(Total payments by 20 member companies of General Insurance Association of Japan)$1=\100

4

IntegrationIntegration

Our Approaches to Climate Change

MitigationMitigation AdaptationAdaptation

Business

Government

CivilSociety

Scientists

Low CarbonSociety

Climate-ResilientSociety

Insurance companies should address climate change with two approaches: mitigation and adaptation.

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Mitigation ApproachInsurance companies should serve as “catalyst” for actions to promote a low carbon society.

Insurance Products and Services

Insurance Products and Services

-Eco-Safe Driving-Automobile Parts Recycling Campaign-Promotion of alternative energy through the provision of weather derivatives

InvestmentInvestment

-Eco-fund / SRI fund-Loan for green buildings-Principle for Responsible Investment -Carbon Disclosure Project

Carbon FootprintReduction

Carbon FootprintReduction

-Installation of energy-efficient equipment-Reducing waste and promoting recycling-Environmental management systems-Green Procurement

6

Mitigation 　 -Insurance Products and Services-

Eco-Safe Driving

GIAJ (General Insurance Association of Japan) has developed the "Eco-Safe Driving" program, which contributes not only to fuel saving and CO2 reduction but also safer driving.

Insurance products and services such as Weather derivatives and Eco-Safe Driving can help corporations and individuals mitigate the discharge of CO2.

Weather derivatives

Promotion of solar power production through the use of weather derivatives

Weather derivative for wind power producers

GIAJ (General Insurance Association of Japan) has developed the "Eco-Safe Driving" program, which contributes not only to fuel saving and CO2 reduction but also safer driving.

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Mitigation 　 -Investment(1/2)-

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

2000 2001 2002 2003 2004 2005 2006 2007

Market size of SRI in Japan(Million $)

Source: SIF - Japan

The market size of SRI (Sustainable and Responsible Investment) inJapan has expanded significantly in recent years.

$1=\100

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Mitigation 　 -Investment(2/2)-

(Yen) (Million Yen)

Eco-fund SRI fund

Sompo Japan Green Open:Since September 1999Balance:11.8 billion yen(as of February 2009)

Sompo Japan SRI Open:Since March 2005Balance:778 million yen(as of February 2009)

The constant value, calculated as the value obtained when reinvesting all dividends at the constant value of the settlement date, as compared to TOPIX (Tokyo Stock Price Index).The constant value and the benchmark TOPIX (not including dividends) are indexed as 10,000 on the date of inception.

Performance of the Sompo Japan Green Open (as compared toTOPIX)

-Total net assets (right axis)-TOPIX (left axis) -Sompo Japan Green Open (left axis)

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Adaptation Approach

Ensuring financial strength

Ensuring financial strength

-Arrange reinsurance-Increase catastrophe reserve

Quick payment to customers

Quick payment to customers

Preventive measuresPreventive measures

Risk financing solutionsRisk financing solutions-Develop risk financing solutions for adaptation

Insurance companies should give full play to their core competency to help create a climate-resilient society.

-Strengthen disaster investigation structure and claims response services

-Provide risk management information tosociety-Set up customer service for loss prevention

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Importance of Adaptation to Climate Change in Asia

Green: Typhoon Heavy rain HurricaneOcher: Drought Forest fireRed: Heat waveBlue: Cold wave

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Adaptation 　 -Risk Financing Solutions-

May June July Aug Sep Oct Nov Dec

Sowing (direct seeding)

Sowing (transplanting)

Transplanting

Flowering

Harvesting

Drought

Tilling Transplanting Flowering Harvesting Sowing

Pictures: Embassy of Thailand website, etc.

Thailand

Weatherindex

insurance

Weather Index InsuranceAdaptation measures are particularly needed in developing countries, which are vulnerable to the effects of climate change.JBIC and Sompo Japan are developing weather derivatives (weather index insurance) as an adaptation measure and international framework for supporting developing countries.

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Integration through Education and Learning

Decade of Education for Sustainable Development -The United Nations adopted the Decade of Education for Sustainable Development resolution in 2002. -The overall goal of this resolution is to integrate the principles, values, and practices of sustainable development into all aspects of education and learning. -This educational effort is expected to encourage changes in behavior that will create a sustainable future in terms of environmental integrity, economic viability, and a just society for present and future generations.

13

Capacity Building –Involving Key Stakeholders –

CSO Learning Scholarship Program

Since 2000 458 students(as of December 2008)

Since 1993 290 seminars14,500 participants(as of December 2008)

Public Seminars on the Environmentwith NGO

Employee Environmental Education Program

CSO : Civil Society Organizations

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●Malaysia, November 2008, UN Asia Ministry Meeting Introduced in UN International Strategy for Disaster Reduction Private Sector Activities in Disaster Risk Reduction Good Practices and Lessons Learned

Disaster Prevention Education “The Fire of Inamura”

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Thank you for your attention