Aflac 2006 Annual Report Download - page 18

Total Investments
and Cash
(In billions)
Aflac’s total investments and
cash increased 6.1% to $52 billion
in 2006.
97 98 99 00 01 02 03 04 05 06
22.9
27.0
32.0 32.2 32.8
39.1
44.1
52.0
49.0
$52.0
Japan U.S.
offer our quality products at very affordable
prices while compensating our sales force
with attractive commissions. To maintain
that advantage, we are continually
identifying areas where we can enhance our
operations. Promoting the use of Aflac
Japan’s electronic enrollment software
called e-App®as well as our net billing
system are examples of our drive to improve
efficiency.
To further improve the efficiency of our
business, we centralized all of the call center
functions into one department called the
Aflac Contact Center. Our consolidated
contact center handles requests for
applications and inquiries about insurance
products, as well as calls from existing
policyholders and sales agencies. The shared
IT infrastructure and expertise at the Aflac
Contact Center allow inbound calls to be
handled as sales opportunities. It also allows
us to make outbound calls to existing
policyholders to sell additional or updated
insurance. Employees at the Aflac Contact
Center responded to 1.6 million incoming
calls and made 1.2 million outbound calls
during 2006.
In late 2006, we completed a $55 million
mainframe consolidation project that has
enhanced our IT capabilities within various
functions of Aflac Japan. As a result, we have
simplified our operating environment and
significantly increased the speed at which we
administer our business. Our new operating
environment should also help us develop
products more quickly and allow us to
provide our customers and agencies with
better and faster service.
Solid Investment Results
Reflect a Successful Approach
Our conservative investment approach
remains the foundation of our strong
balance sheet. We strive to maximize
investment income growth while mitigating
investment risk. As such, we emphasize
liquidity, safety and quality when we invest.
To better match asset and liability durations,
we primarily own longer-dated, yen-
denominated debt securities. Although the
interest rate environment improved
somewhat in 2006, we were still challenged
to find attractive investment yields when
investing our substantial cash flows. Despite
that challenge, Aflac’s investment portfolio
continued to perform well. Some Aflac
Japan investment highlights for 2006 follow:
14
Seigo Yada (second from left) and Go
Matsumoto (second from right) have a lot in
common. They are both 13 years old, have been
playing baseball for most of their lives, and both
represented Japan and their home city of
Kawaguchi City extremely well in the 60th Little
League World Series Championship held in
Williamsport, Pennsylvania, in August 2006.
Another commonality is the fact that both of
their families are covered by Aflac cancer
policies. Pedro Martinez is Seigo’s baseball hero,
and Alex Rodriguez and Hideki Matsui are Go’s
baseball heroes, but their families have also been
heroic to them, helping them every step along
the way as they pursue their baseball dream and
providing protection for their families with Aflac
cancer policies. Far left is Seigo’s father,
Masahiro Yada, and far right is Go’s father,
Katsuhiro Matsumoto.
Aflac to the rescue!