Aflac 2009 Annual Report Download - page 3

Message From Management 2
2009 presented every industry across the globe with the
most formidable economic challenge this generation has ever
experienced. Balance sheet strength and capital adequacy
quickly emerged as a primary focus for investors. Aac’s ability to
generate capital through operations allowed us to maintain strong
capital levels on a regulatory basis. Despite the economic turmoil,
Aac generated combined sales of more than $2.8 billion of total
new annualized premium in the United States and Japan.
A Conversation With Dan Amos 6
Chairman and CEO Dan Amos shares his thoughts on Aac’s
nancial strength, corporate citizenship, the economy, and future
opportunities for Aac.
Aflac Japan 8
Aac Japan continued its status as the number one insurance
company in terms of individual policies in force and surpassed
an important milestone: 20 million individual policies in force.
In addition to favorable nancial performance, we successfully
introduced new products and reached consumers through
advertising that created a marketing phenomenon and advanced
opportunities for sales through the recently opened bank channel.
Move over, Wright brothers! More than 100 years after this
well-known and daring brotherly duo made history with
their rst ight, a different set of wings is making history and
changing lives. But this time, the wings belong to the rather
boisterous, ercely protective, and quite loyal Aac Duck,
whose outstretched wings signify what Aac means when
we say, “We’ve Got You Under Our Wing.” These wings
provide protection, just as we promise. We protect our
policyholders from the nancial storm that’s created when
a medical health event strikes and bills pile up. We
empower our customers to concentrate on getting better
while we focus on quickly paying cash benets.
Aac is different from major medical insurance; it’s
insurance for daily living. Major medical pays doctors and
hospitals. In contrast, Aac pays cash benets directly
to policyholders to help with daily expenditures and the
many out-of-pocket expenses resulting from a serious
illness or injury – like a mortgage, car payment, groceries,
utilities, and child care. The benets are predetermined
based on medical events, and are paid regardless of any
other insurance. Aac claims are easy to le and they’re
processed quickly – usually within four days. Through a
broad range of products, we offer an affordable extra layer
of nancial protection to help provide security at a time
when families need it most. We mean what we say, and
we say what we mean. “We’ve Got You Under Our Wing.”
We’ve Got You Under Our Wing®
Table of Contents
Aflac U.S. 16
Despite a tough economic environment, Aac U.S. forged ahead
with a strong product line and a growing sales force. Aac U.S.
also leveraged a major competitive strength – its brand – to
connect with consumers and better convey how Aac can help
protect their nancial futures.
Selected Financial Data 22
This section includes summary statements of earnings and
balance sheets, stock price ranges, and exchange rates for the
past 11 years.
Management’s Discussion and Analysis 24
This section provides an analysis of Aac’s overall nancial
condition, and reviews the company’s nancial and operational
performance in Japan and the United States.
Consolidated Financial Statements 50
This section contains the consolidated nancial statements of
Aac Incorporated and its subsidiaries.
Notes to the Consolidated Financial Statements 54
This section provides additional information about the
company’s consolidated nancial statements and accounting
policies.
Board of Directors and Management 92
Biographical information about the company’s leaders
As of February 26, 2010, Aac was rated AA- by Standard
& Poor’s, Aa2 (Excellent) by Moody’s, A+ (Superior) by A.M.
Best for nancial strength, and AA- by R&I for insurance
claims-paying ability. For 55 years, Aac products have
given policyholders cash benets for daily living so they can
focus on recovery instead of the nancial stress brought
about by a serious health event. Aac is the number one
provider of guaranteed-renewable insurance in the United
States and the number one insurance company in terms
of individual insurance policies in force in Japan, protecting
more than 50 million people worldwide. Aac has been
recognized by Ethisphere magazine as one of the World’s
Most Ethical Companies for three consecutive years and
has also been named by the Reputation Institute as the
Most Reputable Company in the Global Insurance Industry
for two consecutive years. In 2010 Fortune magazine
named Aac one of the 100 Best Companies to Work For
in America for the twelfth consecutive year. In 2009 Fortune
magazine also ranked Aac number one on its global list
of the Most Admired Companies in the Life and Health
Insurance category. Aac was also named by Forbes
magazine as America’s Best-Managed Company in the
Insurance category. Aac Incorporated is a Fortune 500
company listed on the New York Stock Exchange under
the symbol AFL.