Aflac 2006 Annual Report Download - page 8

Total Revenues
(In billions)
Despite the weaker yen, total
revenues rose 1.8% to $14.6 billion
in 2006, benefiting from solid
growth in premium income and net
investment income.
97 98 99 00 01 02 03 04 05 06
7.3 7.1
8.6
9.7 9.6
10.3
11.4
13.3
14.4 $14.6
Japan U.S.
in Japan, we must focus on active sales
tactics such as face-to-face consulting sales,
rather than the more traditional techniques,
like direct mail, that we have used in the
past. To that end, we began a new agent
training program that we believe will help
our sales associates in Japan develop their
sales skills so they can be more effective in
the market. Our sales associates and
agencies are also building up Aflac’s network
of service shops throughout Japan.
Insurance shops have emerged as a popular
place for consumers to conveniently meet
with Aflac sales associates for face-to-face
consultations.
Even though the demand for our medical
products was weak in 2006, we don’t believe
the basic need for our products has
changed. According to research conducted
by the Japan Institute of Life Insurance,
more than 63% of Japanese consumers
viewed the national health care system as
inadequate in 2005. Against that backdrop,
we believe Aflac Japan still possesses the
core competitive strengths that have
positioned us as the number one seller of
both cancer life and stand-alone medical
insurance and as the largest insurer in Japan
in terms of individual policies in force. We
believe the need for our products, combined
with our strong brand, enormous scale,
efficient operations, relevant products,
broad distribution and dedicated customer
service will continue to set us apart and
position us for future success.
Aflac U.S. – Up, Up and Away!
After experiencing explosive growth of our
U.S. operation from 2000 through 2002, we
spent much time and energy on
strengthening the distribution side of our
business as a platform for future growth.
Our objective was to enhance our sales
management infrastructure and to increase
our recruiting and training capacity in the
field. These changes were extensive, and
they were also disruptive. But our 2006
results suggest they were also necessary and
effective. Aflac U.S. surpassed its objective
last year and produced record new sales.
From a product perspective, 2006 was a year
of enhancing products to ensure they
provide the best value when consumers
need them. In January, we launched a
revised life insurance product line, and in
July, we introduced an updated specified
health event policy, which includes an option
to combine it with our intensive care policy.
Because the combination takes advantage of
administrative efficiencies, the combined
premium is lower than when the two
products are purchased separately.
We were very pleased with the expansion of
our sales force in 2006. New sales associate
recruitment was strong. However, even more
meaningful and encouraging was the solid
increase in the number of sales associates
who consistently produced business in 2006.
We believe our success in increasing the
number of average weekly producing sales
associates is directly related to the training
programs we have implemented.
The Aflac Duck’s calendar was quite full,
appearing in four new commercials in 2006.
Unlike previous Aflac Duck commercials, we
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