Aflac 2010 Annual Report Download - page 30

G L O S S A R Y O F S E L E C T E D T E R M S
© 2010 Aflac Incorporated. All rights reserved.
Aflac®, SmartApp®, SmartApp Next Generation® and “We’ve Got You Under Our Wing”® are
registered trademarks of American Family Life Assurance Company of Columbus.
Aflac for BrokersSM is a trademark of American Family Life Assurance Company of Columbus.
Communicorp, Aflac’s printing and communications subsidiary, has received Forest
Stewardship Council (FSC) certification. This chain-of-custody certification is part of
a not-for-profit organization program that brings people together to find solutions and
reward good forest management.
Affiliated Corporate Agency – Agency in Japan directly
affiliated with a specific corporation that sells insurance
policies primarily to its employees
Benefit Ratio – Incurred claims plus the change in reserves
for future policy benefits, as a percentage of total revenues
Child Endowment Product – Insurance product
traditionally used in Japan providing cash to help fund higher
costs associated with a child entering high school and
college in Japan
Earnings Per Basic Share – Net earnings divided by the
weighted-average number of shares outstanding for
the period
Earnings Per Diluted Share – Net earnings divided by
the weighted-average number of shares outstanding for the
period plus the weighted-average shares for the dilutive effect
of share-based awards outstanding
Group Insurance – Insurance issued to a group, such as
an employer or trade association, that covers employees
or association members and their dependents through
certificates of coverage
Individual Insurance – Insurance issued to an individual
with the policy designed to cover that person and their
dependants
In-force Policies – A count of policies that are active
contracts at the end of a period
New Annualized Premium Sales – Annual premiums,
on policies sold and incremental increases from policy
conversions, collected over a 12-month period, assuming the
policies remain in force
Operating Earnings Per Share – Profits per share
derived from operations before realized investment gains and
losses from securities transactions, the impacts from ASC
810 and ASC 815, as well as nonrecurring items
Perpetual Securities – Financial instruments that have
characteristics of both stocks and bonds. These investments
are subordinate to senior bonds, but rank higher than equities
and generally rank higher than preferred stock. A perpetual
security does not have a stated maturity date, but instead
typically has what is sometimes referred to as an economic
maturity. An economic maturity is a date at which a perpetual
security is expected to be redeemed by the issuer
Persistency – Percentage of premiums remaining in force
at the end of a period, usually one year. For example, 95%
persistency would mean that 95% of the premiums in force
at the beginning of the period were still in force at the end of
the period
Return on Average Invested Assets – Net investment
income as a percentage of average cash and investments at
amortized cost
Risk-based Capital (RBC) Ratio – Statutory adjusted
capital divided by statutory required capital. This insurance
ratio is based on rules prescribed by the National Association
of Insurance Commissioners (NAIC) and provides an
indication of the amount of statutory capital the insurance
company maintains, relative to the inherent risks in the
insurer’s operations
Total Return to Shareholders – Appreciation of a
shareholder’s investment over a period of time, including
reinvested cash dividends paid during that time
Voluntary Supplemental Insurance – Insurance policies
designed to provide an extra layer of financial protection. For
example, Aflac voluntary supplemental medical insurance
provides cash benefits that insureds may direct toward
medical or nonmedical expenses not covered by a major
medical plan or universal health care insurance system
WAYS – Hybrid insurance product from Aflac Japan’s
portfolio that starts out as a whole-life policy, but allows
a large portion of the life coverage to be converted to a
fixed annuity, medical coverage or nursing care benefit at a
predetermined age
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