Filing Compare · MS&AD Insurance Group Holdings, Inc.

ByTable mail: of Contents

FORM 6-K

U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of 1934

Commission File Number: 333-150010

For the Month of June, 2010

MS&AD Insurance Group Holdings, Inc.

(Translation of registrant’s name into English)

3-7, Yaesu 1-chome,
Chuo-ku, Tokyo 103-0028, Japan

(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.


Form 20-F x		Form 40-F o

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): o

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): o

Information furnished on this form:

Table of Contents

1. [English Translation] ~~Notice of Convocation of the 2nd Annual Shareholders’ Meeting~~

~~2. [English Translation] Summary~~ Expansion of ~~Financial~~Non-life ~~Statements for the Year Ended March 31, 2010 (MS&AD~~ Insurance ~~Group~~Operations ~~Holdings,~~and ~~Inc.,~~Entry ~~Formerly,~~to ~~Mitsui~~Life ~~Sumitomo~~ Insurance ~~Group~~Market ~~Holdings,~~in ~~Inc.)~~Malaysia

3. [English Translation] Overview of Business Results of MS&AD Insurance Group Holdings, Inc., FY 2009

4. [English Translation] (Reference) Summary of Financial Statements for the Year Ended March 31, 2010 (On Behalf of Aioi Insurance Co., Ltd.)

5. [English Translation] (Reference) Summary of Financial Statements for the Year Ended March 31, 2010 (On Behalf of Nissay Dowa General Insurance Co., Ltd.)

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	MS&AD Insurance Group Holdings, Inc.
Date: June 7, 2010	By:	/s/ Yasuaki Tamai
Date: June 18, 2010	By:	/s/ Yasuaki Tamai
		Yasuaki Tamai
		General Manager General Administration Dept.

Notice: This translation has been prepared solely for convenience of reference by shareholders. Please be advised that any discrepancy that may exist between this translation and the Japanese original shall be resolved in favor of the latter. Please also be advised that certain expressions for domestic voting procedures that are not applicable to shareholders outside Japan are translated solely for reference and to avoid confusion.

[English Translation]

~~Securities~~June 18, ~~Code~~2010 MS&AD ~~8725~~Insurance Group Holdings, Inc.

~~June 7,~~Expansion ~~2010~~of Non-life Insurance Operations and Entry to Life Insurance Market in Malaysia

~~Dear~~Mitsui ~~Shareholders:~~Sumitomo Insurance Company, Limited, a consolidated subsidiary of the Company, has agreed to form an alliance involving the non-life and life insurance business with Hong Leong Financial Group (hereafter “HLFG”), a well established local conglomerate. The detail of the agreement is as set out in the attachment.

~~Notice~~No ofchange ~~Convocation~~is to be made to the earnings forecast of the ~~2nd~~Company for the fiscal year ending March ~~Annual~~31, ~~Shareholders~~2011 ~~Meeting~~released on May 20, 2010 in connection with this alliance.

We are pleased to announce that the 2nd Annual Shareholders Meeting of the Company will be held as stated below and your attendance is cordially requested.

You are respectfully requested, in the event you are unable to attend the aforesaid meeting, to study the Reference Document for Annual Shareholders Meeting below and to exercise your voting right in accordance with the guidance stated on the following page, since you are authorized to exercise voting rights by submission of the document or via the Internet.

	Yours faithfully, MS&AD Insurance Group Holdings, Inc. (the “Company”) 3-7, Yaesu 1-chome, Chuo-ku, Tokyo
	By:	Toshiaki Egashira
		President and Representative Director

Particulars

1. Date and Time: 10:00 a.m. on June 29, 2010 (Tuesday)

2. Place: Heian Room, Main Building first floor, Hotel Okura Tokyo located at 10-4, Toranomon 2-chome, Minato-ku, Tokyo (Please note that the place of meeting is different from the previous meetings, and refer to the map attached at the end of this notice.)

3. Purposes of the Meeting: Matters to be reported:

1. Report on the Business Report, Consolidated Financial Statements, and Results of Audit of Consolidated Financial Statements by Accounting Auditor and the Board of Corporate Auditors for the 2nd fiscal year (Fiscal Year 2009 (from April 1, 2009 to March 31, 2010)); and

~~2. Report on the Financial Statements for the 2nd fiscal year (Fiscal Year 2009 (from April 1~~ June 18, ~~2009~~2010 Mitsui toSumitomo ~~March~~Insurance 31Company, ~~2010)).~~Limited

~~Matters~~MSI sets to beenter ~~resolved:~~Life ~~First~~Insurance ~~Item:~~Business ~~Appropriation~~in ofMalaysia ~~Retained~~as ~~Earnings~~well ~~Second~~as ~~Item:~~Expand ~~Election~~its ofCurrent ~~Thirteen~~Non-Life Insurance ~~(13) Directors~~Business

~~When~~Mitsui ~~you~~Sumitomo ~~attend~~Insurance ~~the~~Co., ~~meeting~~Ltd. in(President: ~~person~~Yasuyoshi Karasawa, ~~please~~here ~~submit~~after “MSI”), has reached a basic agreement to form a strategic alliance involving the ~~enclosed~~non-life ~~Voting~~and ~~Right~~life ~~Exercise~~insurance ~~Form~~business towith Hong Leong Financial Group (hereafter “HLFG”), a well established local conglomerate. This agreement followed approval that MSI has received from the ~~receptionist~~regulatory atauthorities in Malaysia. We plan to launch the ~~place~~alliance ofin ~~meeting~~this autumn.

~~When~~To ~~you~~proactively ~~attend~~invest ~~the~~in ~~meeting~~non-life byand ~~proxy,~~life ~~please~~insurance ~~submit~~business aoverseas ~~letter~~is one of ~~proxy~~MSI’s ~~together~~driving strategies towards achieving sustainable growth. The alliance with ~~the~~HLFG will allow MSI to ~~enclosed~~simultaneously ~~Voting~~achieve ~~Right~~expansion ~~Exercise~~of ~~Form~~its tocurrent ~~the~~non-life ~~receptionist~~business atand entering the ~~place~~life ofinsurance market, ~~meeting.~~in ~~The~~Malaysia ~~proxy~~which ~~must~~is be one ~~(1) shareholder~~of ~~who~~the ~~has~~most astrategically ~~voting~~important ~~right~~countries in Asia.

MSI intends to take this opportunity to further accelerate its ongoing effort in establishing a stable business base in the Asian market.

1. Overview of the Alliance

(1)		Non-Life Insurance Business

		The non-life insurance business portfolio of Hong Leong Assurance Berhad (hereafter “HLA”), a subsidiary of HLFG, will be merged with that of MSIG Insurance (Malaysia) Bhd. (hereafter “MSIGM”), a subsidiary of MSI. As a result, shareholders’ equity of the enlarged MSIGM will be 70%* owned by MSI and 30% owned by HLFG, creating the second largest non life insurance company in Malaysia by premium income.

* MSI’s share includes approximately 5% of shares held by minority shareholders.


(2)		Life Insurance Business

		MSI will purchase 30% of outstanding shares in HLA for the price of RM 940 Million, approximately JPY 25.4 billion, thereby entering the life insurance market in Malaysia holding a stake in a well established life insurance company ranking No.6 by premium income in the market. MSI will second officers and employees, transferring technical know-how on life insurance with more innovative products and underwriting support with the objective of supporting HLA to become a top rank life insurer in Malaysia at an early stage.

(3)		Specific actions/ Objectives of the Alliance

	(i)		Expanding Insurance Sales through Bancassurance

			We will expand our sales force of both the non-life and life insurance business through bancassurance at HLFG’s bank subsidiary.

	(ii)		We will supply distinguished non-life and life insurance products through the synergy effect of MSI and HLFG which will bring together the respective brand strengths, business bases and insurance business know-how, simultaneously MSI aims to further enhance the corporate value of MS & AD Insurance Group.

~~Guidance~~2. ~~for~~Purpose ~~the~~and ~~Exercise~~Background of ~~Voting~~the ~~Rights~~ Alliance

1. When you attend the meeting in person, please submit the enclosed Voting Right Exercise Form to the receptionist at the place of meeting.

	(1)		Malaysia, with a population of approximately 28 million, is a politically stable country experiencing one of the most remarkable growth surges in Asia, also with further growth potential in the insurance market.

	(2)		The alliance will, all together, bring about MSI’s expansion in the non-life insurance market and entry into the life insurance market, in the Asian region which is strategically important and considered as one of the growth areas for its overseas business. MSI believes this is a valuable opportunity in establishing a stable business base in the Asian life insurance market.

2.Conversion InRate: ~~the~~1 ~~event~~Malaysian ~~that~~Ringgit= ~~you~~27 ~~are~~Yen ~~unable~~in tothis ~~attend~~letter ~~the~~including ~~aforesaid~~its ~~meeting, please exercise your voting right by choosing either of the methods stated below.~~appendix

Please indicate on the Voting Right Exercise Form enclosed herewith your consent or dissent to the items on the agenda and return the form to be received by the transfer agent of the Company by mail before 5:00 p.m., June 28, 2010 (Monday).Appendix

Via the Internet:

1.		Overview of the Hong Leong Group and its Insurance Subsidiary

		The Hong Leong Group, a leading conglomerate in Malaysia, operates in a diverse range of industries- banking and financial services, manufacturing and distribution, property development and 14 of its subsidiaries are listed companies in Malaysia.

		Its insurance arm, Hong Leong Assurance Berhad is a composite insurer and is currently wholly owned by the Hong Leong Group.

		Hong Leong Assurance Berhad

	(1)		First, please access the designated website for exercising voting rights as set forth below from your personal computers or your mobile phones and use the “vote exercise code” and “temporary password” written on the enclosed Voting Right Exercise Form. Then, please register your consent or dissent to the items on the agenda by following the instructions on the display screen, before 5:00 p.m., June 28, 2010 (Monday). URL for the website for exercising voting rights: http://www.webdk.net
Established		: December 20, 1982
	(2)		In the case that a voting right is exercised via the Internet, even if the Voting Right Exercise Form is returned by mail, only the vote registered via the Internet will be recognized as valid.
Number of Branches		: 21
	(3)		In the event that a voting right is exercised more than once via the Internet, only the last vote via the Internet will be recognized as valid.
Shareholders		: Hong Leong Group 100%
	(4)		Any connection charges and communications expenses payable to Internet providers and telecommunication carriers incurred in connection with the exercise of the voting right via the Internet will be borne by the exercising shareholder.
Premium Income		:(Life insurance) 24.9 Billion Yen (FYE June 2009) Market Share: 4.9% (Non-Life Insurance) 8.2 Billion Yen(FYE June 2009) Market Share:2.5%
	(5)		To access the website for exercising voting rights above, the system environments as described below are required:
			For personal computer:

~~Your~~Hong ~~personal~~Leong ~~computer~~Bank ~~should be equipped with the proper software to access the Internet (browser) such as Internet Explorer 6.0 and upgraded versions.~~Berhad

For mobile phone:


Number of Branches		: 185
Shareholders		: Hong Leong Group 64% (As of August 2009)
Total Deposits		: 1,824.8 Billion Yen (FYE June 2009)
Net Assets		: 156. 0 Billion Yen (FYE June 2009)

~~128bitSSL (encoded communication) should be available to the mobile phone to be used~~2. ~~(For~~Overview ~~the purpose~~ of ~~ensuring~~MSIG ~~security,~~Insurance ~~only~~(Malaysia) ~~mobile~~Bhd. ~~phones~~MSIG ~~with~~Insurance ~~function of 128bitSSL~~ (~~encoded communication~~Malaysia) ~~may access the website, but other types of mobile phones cannot access it~~Bhd.)

Should you have any inquiry regarding exercise of the voting right via the Internet, please contact the transfer agent stated below:


Established		: April 28, 1979
Number of Branches		: 13
Shareholders		: Mitsui Sumitomo Insurance Co., Ltd. 93% (Includes indirect holdings)
Premium Income		: (Non-Life Insurance) 21.6 Billion Yen (FYE December 2009) Market Share: 6.8%

The Sumitomo Trust & Banking Co., Ltd. Stock Transfer Agency Dept., Free dial: 0120-186-417 (24 hours)

- End -

This Notice, the Attached Document hereto, and Reference Document for the Annual Shareholders Meeting are posted on the Company’s website (http://www.ms-ad-hd.com). When any amendment thereto occurs, the Company will publish the amended versions on the website.

Attached Document

BUSINESS REPORT

( From: April 1, 2009 To: March 31, 2010 )

1. Details on the Current Status of the Insurance Holding Company

(1) Progress of business and business results

Features of mild recovery was seen in part of the economy during the latter half of the fiscal year, such as increase of exports and upturn of personal consumption and capital investment, but economy of Japan as a whole stayed in an inactive trend, since corporate profitability could not recover substantially and employment situation stayed in serious status.

The business environment for the insurance industry is still severe. In the non-life insurance industry, revenues decreased due to decline in sales of automobile liability and marine liability insurance. In the life insurance industry, the value of new contracts continued to decline against a background of an aging society and the trend toward having fewer children.

The MS&AD Insurance Group has been working actively to implement corporate social responsibility (CSR) in management through a positive cycle of perpetually striving to improve quality, earning the trust of even more of our customers, and achieving growth in the business based on that trust. Our goal is to become a top, world class insurance and financial group that grows through competitiveness derived from the quality of our company’s products, based on New Challenge 10, our medium-term management plan which began in fiscal year 2007.

The Company as a holding company, with an aim of further promoting each businesses of our domestic non-life insurance business, life insurance business, overseas business, financial services business, and risk-related business, strategically allocated its management resources, simultaneously working further on strengthening our position on risk-management, compliance and internal audits, and handling other administrative tasks by measures such as monitoring of each company operations.

Furthermore, on September 30, 2009, the Company and Mitsui Sumitomo Insurance Co., Ltd. (hereinafter, “MSI”) reached agreement on business integration with Aioi Insurance Co., Ltd. (hereinafter, “Aioi”) and Nissay Dowa General Insurance, Co., Ltd. (hereinafter, “NDGI”) in order to achieve sustainable growth and to enhance enterprise value, and “MS&AD Insurance Group” was established on April 1, 2010. Accordingly, the Company changed its corporate name into “MS&AD Insurance Group Holdings, Inc.”, and newly started its operations as a holding company of the new group.

The progress and results of each of our various business efforts the current fiscal year are as follows:

Domestic Non-life Insurance Business

We worked to improve quality of operational process dramatically and thus, promote our business in non-life insurance business.

Mitsui Sumitomo Insurance launched GK Home Insurance and GK Injury Insurance and together with GK Automobile Insurance launched in the previous year, completed its lineup of GK, a brand name of its major products for individual customers developed under the policy of “easy to understand”, and “easy to choose”. We also kept undertaking innovations in various operational processes ranging from product development through payment of insurance premiums. Such innovations included work on the introduction of an electronic booking system in agencies to handle contract processing accurately and efficiently. We also

developed new insurance benefits payment system to enable fair, equitable, and prompt payment.

At Mitsui Direct General Insurance Company, Limited (hereinafter “Mitsui Direct”), our policies in force increased constantly under its unique business model that takes advantage of the unique characteristics of the Internet to offer products with simple, easily understood information on indemnity, and have also focused on further improving services such as renovation of webpage for mobile phones to improve customers’ convenience and enhancement in road services for policyholders of automobile insurance.

Life Insurance Business

As a core business within our group, we are striving to further expand our life insurance business as we work to improve corporate quality.

At Mitsui Sumitomo Kirameki Life Insurance Co., Ltd. (hereinafter “Kirameki Life”), we worked to expand our sales base by pursuing business alliances in insurance sales with financial institutions, as well as improving variations in products the financial institutions deal with. We also introduced “New Medical Insurance α” and “New Cancer Insurance α”, a new product which provide broadened guarantee such as payment for advanced medical treatments, and started a new system for total managing of insurance claims and payment processing to improve its payment management ability.

MSI MetLife continued to expand the sales base for individual pension insurance such as further enhancing business alliances with financial institutions.

Overseas Business

In overseas business, we made progress on strengthening competitiveness by further expanding our branch network in Asia, establishing a local subsidiary in Laos, opening a branch in Beijing via the local subsidiary in China, and promoting sales of policies covering corporate risk in Europe, among others. We also worked on further enhancement of risk management such as reinforcing risk monitoring in overseas business.

Asset Management and Financial Services Businesses, Risk-related Businesses

As the central company responsible for asset management in the group, Mitsui Sumitomo Insurance strove to ensure stable profits by exercising comprehensive oversight of assets and liabilities and continuing to reduce domestic shareholdings and other risky assets in order to further reduce the risk of price fluctuation for assets. We also worked on enhanced management of credit risk and improvement of liquidity in assets.

In the financial services business, we especially concentrated in operation and management business of defined benefit pensions, sales of defined benefit pension products, weather and earthquake-related derivatives, and Japan Housing Finance Agency-supported loans.

We offered various services related to the risk management business, such as in nursing care business, and in asset valuation and appraisal business through our risk-related business, and also promoted consulting services relating to new influenza.

Current-Year Business Performance

The above factors resulted in the following consolidated operating results for our company. Insurance underwriting income was ¥1.8 trillion; income from asset management, ¥139.9 billion; and other ordinary income, ¥10.1 billion, for a total of ¥1.9 trillion in ordinary income, decrease by 3.8% from the previous fiscal year.

In terms of ordinary expenses, meanwhile, ¥1.5 trillion in insurance underwriting expenses, ¥47.0 billion in asset management expenses, ¥294.9 billion in SG&A expenses, and ¥6.8 billion in other ordinary expenses resulted in a total of ¥1.9 trillion which was 7.0% decrease from the previous fisal year.

This led in an ordinary profit of ¥52.6 billion. After adjusting this for extraordinary income, extraordinary losses, and corporate and resident taxes and other factors, net income came to ¥37.6 billion, increase of ¥29.4 billion, and 359.5% from the previous fiscal year.

Parent company results included ¥37.3 billion in dividends from subsidiaries and ¥2.6 billion in business administration fees, amounting to ¥40.0 billion in operating income, ¥37.0 billion in ordinary profits, and ¥37.0 billion in net income for the current year, which are increase of 5.1%, 6.7% and 6.7%, respectively, from the previous fiscal year.

Mitsui Sumitomo Insurance saw a 2.5% decline in net premiums written from the previous fiscal year to ¥1.2 trillion, owing to decreased income from marine liability insurance. The net loss ratio also rose by 0.6 percentage points over the previous fiscal year to 70.4%, and the net operating expense ratio rose 0.4 percentage points over the previous fiscal year to 34.5%.

Kirameki Life saw 4.0% decrease in new contracts written over the previous fiscal year, booking ¥1.5 trillion for total individual insurance and individual pension insurance, but total balance of insurance in force increased by 4.6% to ¥9.4 trillion. New group insurance written this fiscal year reached ¥26.1 billion, with a year-end balance of insurance in force of ¥2.69 trillion.

Mitsui Direct posted ¥32.4 billion in net premiums written, for growth of 9.3% compared with the previous fiscal year. The net loss ratio rose 4.6 percentage points over the previous fiscal year to 70.2%, and the operating expense ratio declined 3.4 percentage points from the previous fiscal year to 24.8%.

Total new insurance written for MSI MetLife for individual insurance and individual pension insurance was ¥408.1 billion, a decrease of 31.2% over the previous fiscal year, due to downsizing of markets for variable annuities and revising of its products. The balance of insurance in force at the end of the current fiscal year increased by 26.6% to ¥3.1 trillion.

Issues to be Addressed

Economy of Japan is expected to recover in a mild trend, such as improvement of corporate profits and recovery in domestic demands which includes capital investment and personal consumption, etc.

Efforts to meet demands of customers accurately and to improve profitability is becoming more important in the insurance industry, which is yet under severe business circumstances as seen in low increase in number of automobiles owned and aging population, which will cause increased competition between insurance companies.

Under the circumstances, in order to achieve sustainable growth and enhancement of enterprise value of MS&AD Insurance Group, the Company launched new group medium-term management plan “MS&AD New Frontier 2013”.

In this plan, the Company aims to achieve synergies and further improve its profitability through raising efficiency of system development and operation by integrating systems of MSI, Aioi and NDGI, and decreasing costs. The Company also aspires to maintain sound operation of its business by establishing group governance structure with the holding company placed at its center, and also to achieve growth by improving quality of all operations and gain customers’ trust.

MS&AD Insurance Group will actively promote each businesses of domestic non-life insurance business, domestic life insurance business, overseas business, financial services business, and risk-related businesses, and will create globally operating and world-leading insurance and financial services group.

We ask for the continued support and encouragement of our shareholders in the weeks and months to come.

(Note) All monetary amounts and share numbers in this business report (including the statements that follow) have been expressed with fractional amounts omitted. Percentages of increase or decrease are expressed to two decimal places and rounded off to the nearest first decimal place.

(2) Changes in assets and profit and loss status

a. Changes in the Company’s assets and profit and loss status

(Millions of yen)

							Fiscal year
	Fiscal year		Fiscal year		Fiscal year		2009
Category	2006		2007		2008		(Current FY)
Operating income		—		—		38,073		40,018
Dividends received		—		—		35,250		37,375
Subsidiaries engaged in the insurance industry		—		—		35,250		37,375
Other subsidiaries		—		—		—		—
Current net income		—		—		34,689		37,026
Net income per share	—Yen—Sen		—Yen—Sen		82 Yen 38 Sen		88 Yen 37 Sen
Total assets		—		—		780,551		769,963
Shares of subsidiaries engaged in the insurance industry		—		—		756,614		761,714
Shares of other subsidiaries		—		—		—		—

(Note) Nothing is recorded for Fiscal 2007 or prior years because the Company was established on April 1, 2008.

b. Changes in consolidated assets and profit and loss status

(Millions of yen)

							Fiscal year
	Fiscal year		Fiscal year		Fiscal year		2009
Category	2006		2007		2008		(Current FY)
Consolidated ordinary income		—		—		2,040,013		1,962,689
Consolidated ordinary profit/losses		—		—		-13,044		52,695
Consolidated net income		—		—		8,192		37,640
Consolidated net assets		—		—		1,023,021		1,311,082
Consolidated total assets		—		—		7,440,709		7,519,625

(Note) Nothing is recorded for Fiscal 2007 or prior years because the Company was established on April 1, 2008.

(3) Offices

Name of office		Location		Date founded
Headquarters		27-2, Shinkawa 2-chome, Chuo-ku, Tokyo		April 1, 2008

(Note) The Company moved its headquarters from the location shown above to 3-7, Yaesu 1-chome, Chuo-ku, Tokyo as of April 1, 2010.

(4) Employees

a. Status of the employees of the Company

As of the end of the current fiscal year

Increase or

Average years of

End of previous

End of current

decrease in the

continuous

Average monthly

fiscal year

Average age

employment

salaries

Category

(No. of employees)

(Years)

(Thousand yen)

Employees

46.6

23.0

762

(Note)	1.	All employees of the company are on loan from its subsidiaries.
	2.	Employees do not include employees concurrently serving as directors, on leave, or temporary employees.
	3.	The average number of years of continuous employment is the aggregate number of years employed at its subsidiaries.
	4.	The average monthly wage is the average monthly wage in March 2010 (including overtime pay). Bonuses are not included.
	5.	The average age and average number of years employed have been rounded to one decimal place.

b. Status of employees of the consolidated companies

(No. of employees)

					Increase/decrease
	End of previous		End of current		for the current fiscal year
Division Name	fiscal year		fiscal year		(Change)
Non-life Insurance Business		20,485		20,639		154
Life Insurance Business		803		1,219		416
Company Wide (in common)		48		50		2
Total		21,336		21,908		572

(Note) Company Wide (in common) notes the number of employees in the Company that cannot be categorized into specific segments.

(5)		Main Lenders
		Not applicable.
(6)		Capital procurement
		Not applicable.
(7)		Capital investment

a. Total Amount of Capital Investment

(Millions of yen)

Total amount of capital investment 173

b. Establishment of Major Facilities, etc. Not applicable.

(8) Parent company and key subsidiaries

a. Status of parent company Not applicable. b. Status of key subsidiaries

Date of

Percentage of

Name of company

Location

Principal business

incorporation

Paid-in capital

voting rights (%)

Others

Mitsui Sumitomo Insurance Co., Ltd.

Chuo-ku, Tokyo

Non-life insurance business

Oct. 21, 1918

¥139,595 million

100.0

—

Mitsui Sumitomo Kirameki Life Insurance Company, Limited

Chiyoda-ku, Tokyo

Life insurance business

Aug. 8, 1996

¥35,500 million

100.0

—

MITSUI SUMITOMO INSURANCE Capital Co., Ltd.

Chuo-ku, Tokyo

Venture capital business

Dec. 6, 1990

¥1,000 million

100.0 (100.0

% %)

—

Mitsui Direct General Insurance Company, Limited

Bunkyo-ku, Tokyo

Non-life insurance business

June 3, 1999

¥32,600 million

69.6

—

Mitsui Sumitomo MetLife Insurance Co., Ltd.

Chuo-ku, Tokyo

Life insurance business

Sep. 7, 2001

¥41,060 million

51.0

—

Sumitomo Mitsui Asset Management Company, Limited

Minato-ku, Tokyo

Investment advisory business and investment trust management business

July 15, 1985

¥2,000 million

27.5 (27.5

% %)

—

MSIG Holdings (Americas), Inc.

New York, U.S.A.

Holding company

Oct. 21, 1988

US$3,600 thousand (¥334 million)

100.0 (100.0

% %)

—

Mitsui Sumitomo Insurance USA Inc.

New York, U.S.A.

Non-life insurance business

Jan. 28, 1988

US$5,000 thousand (¥465 million)

100.0 (100.0

% %)

—

Date of

Percentage of

Name of company

Location

Principal business

incorporation

Paid-in capital

voting rights (%)

Others

Mitsui Sumitomo Insurance Company of America

New York, U.S.A.

Non-life insurance business

Mar. 29, 2001

US$5,000 thousand (¥465 million)

100.0 (100.0

% %)

—

Mitsui Sumitomo Seguros S/A.

Sao Paulo, Brazil

Non-life insurance business

Dec. 15, 1965

BRL281,368 thousand (¥14,583 million)

99.0 ( 99.0

% %)

—

MSIG Holdings (Europe) Ltd.

London, U.K.

Holding company

Mar. 7, 2000

UK£391,843 thousand (¥55,014 million)

100.0 (100.0

% %)

—

Mitsui Sumitomo Insurance (London Management) Ltd

London, U.K.

Holding company

Jan. 6, 2000

UK£35,960 thousand (¥5,048 million)

100.0 (100.0

% %)

—

Mitsui Sumitomo Insurance Company (Europe) Limited

London, U.K.

Non-life insurance business

July 28, 1972

UK£66,900 thousand (¥9,392 million)

100.0 (100.0

% %)

—

Mitsui Sumitomo Insurance (London) Limited

London, U.K.

Non-life insurance business

Oct. 6, 1975

UK£379,107 thousand (¥53,226 million)

100.0 (100.0

% %)

—

MSI Corporate Capital Limited

London, U.K.

Non-life insurance business

Jan. 7, 2000

UK£5,200 thousand (¥730 million)

100.0 (100.0

% %)

—

MS Frontier Reinsurance Limited

Hamilton, Bermuda

Non-life insurance business

Sep. 9, 1997

US$294,588 thousand (¥27,408 million)

100.0 (100.0

% %)

—

Mitsui Sumitomo Reinsurance Limited

Dublin, Ireland

Non-life insurance business

Feb. 11, 1999

€20,000 thousand (¥2,498 million)

100.0 (100.0

% %)

—

MSIG Holdings (Asia) Pte. Ltd.

Singapore, Singapore

Holding company

Sep. 23, 2004

S$673,515 thousand (¥44,788 million)

100.0 (100.0

% %)

—

MSIG Insurance (Singapore) Pte. Ltd.

Singapore, Singapore

Non-life insurance business

Sep. 23, 2004

S$263,442 thousand (¥17,518 million)

100.0 (100.0

% %)

—

Mitsui Sumitomo Insurance (Singapore) Pte Ltd

Singapore, Singapore

Non-life insurance business

Dec. 1, 1990

S$25,000 thousand (¥1,662 million)

100.0 (100.0

% %)

—

MSIG Mingtai Insurance Co., Ltd.

Taipei, Taiwan

Non-life insurance business

Sep. 22, 1961

NT$2,535 thousand (¥7,430 million)

100.0 (100.0

% %)

—

Mitsui Sumitomo Insurance (China) Company, Limited

Shanghai, P.R.C.

Non-life insurance business

Sep. 6, 2007

RMB500,000 thousand (¥6,815 million)

100.0 (100.0

% %)

—

MSIG Insurance (Hong Kong), Limited

Hong Kong, P.R.C.

Non-life insurance business

Sep. 8, 2004

HK$1,625,842 thousand (¥19,477 million)

100.0 (100.0

% %)

—

MSIG Insurance (Vietnam) Company Limited

Hanoi, Vietnam

Non-life insurance business

Feb. 2, 2009

VND300,000 million (¥1,470 million)

100.0 (100.0

% %)

—

Date of

Percentage of

Name of company

Location

Principal business

incorporation

Paid-in capital

voting rights (%)

Others

PT. Asuransi MSIG Indonesia

Jakarta, Indonesia

Non-life insurance business

Dec. 17, 1975

IDR40,000 million (¥412 million)

80.0 (80.0

% %)

—

MSIG Insurance (Thailand) Co., Ltd

Bangkok, Thailand

Non-life insurance business

Apr. 14, 1983

THB142,666 thousand (¥409 million)

80.3 ( 80.3

% %)

—

MSIG Insurance (Malaysia) Bhd.

Kuala Lumpur, Malaysia

Non-life insurance business

Apr. 28, 1979

MYR212,000 thousand (¥6,035 million)

93.5 ( 93.5

% %)

—

MSIG Insurance (Lao) Co., Ltd.

Vientiane, Laos

Non-life insurance business

Sep.18, 2009

US$2,000 thousand (¥186 million)

51.0 ( 51.0

% %)

—

(Note)	1.	The table above shows key subsidiaries and other companies.
	2.	MSIG Insurance (Lao) Co., Ltd. is newly listed from the current fiscal year as one of the key subsidiaries and other companies.
	3.	The Yen amount shown in parentheses in the Pain-in capital column is the value calculated by conversion at the exchange rate on the final day of the current fiscal year.
	4.	The percentage in parentheses in the Percentage of voting rights column shows the percentage of voting rights for indirect holdings.

(9)		Status of business transfers/assignments
		Not applicable.
(10)		Other important matters concerning the present state of other holding companies.
		Not applicable.

2. Matters Concerning Company Officers

(1) Status of company officers

(As of year end)

Key positions held Name Position and responsibilities concurrently Other Yoshiaki Shin Chairman & Director Chairman & Director, Mitsui Sumitomo Insurance Co., Ltd. — Toshiaki Egashira Representative Director President & CEO President, Director & CEO, Mitsui Sumitomo Insurance Co., Ltd. — Hiromi Asano Director Vice President Executive Officer Marketing and Sales Director & Vice President Executive Officer, Mitsui Sumitomo Insurance Co., Ltd. — Isamu Endo Director Senior Executive Officer Corporate Management Aide Corporate Planning Dept. (Except Integration Promotion Section), Business Development Dept., Shareholder Relations & Legal Dept., Internal Audit Dept. — — Yasuyoshi Karasawa Director Senior Executive Officer Accounting Dept., Corporate Communications Dept., Integration Promotion Committee Director & Senior Executive Officer, Mitsui Sumitomo Insurance Co., Ltd. — Susumu Fujimoto Director Senior Executive Officer Overseas Business Director & Senior Executive Officer, Mitsui Sumitomo Insurance Co., Ltd. — Katsuaki Ikeda Director Managing Executive Officer General Affaires and Financial Services Business Director & Managing Executive Officer, General Manager of Financial Services Division, Mitsui Sumitomo Insurance Co., Ltd. — Hitoshi Ichihara Director Managing Executive Officer Human Resources Dept., Administration and Systems Director & Managing Executive Officer, Mitsui Sumitomo Insurance Co., Ltd. — Shuhei Horimoto Director Managing Executive Officer Corporate Management Aide Compliance Dept., Corporate Risk Management Dept., Internal Audit Dept. Director & Managing Executive Officer, Mitsui Sumitomo Insurance Co., Ltd., — Eiko Kono Outside Director Outside Director, Mitsui Sumitomo Insurance Co., Ltd. Outside Director, HOYA Corporation Outside Director, DIC Corporation —

Key positions held Name Position and responsibilities concurrently Other Kenji Koroyasu Outside Director Advisor, TMI Associates Outside Director, Mitsui Sumitomo Insurance Co., Ltd. Outside Director, Central Japan Railway Company Outside Corporate Auditor, Heiwa Corporation — Iwao Taka Outside Director Dean, Reitaku University, School of Economics and Business Administration Outside Director, Mitsui Sumitomo Insurance Co., Ltd. — Toshihiko Seki Outside Director Professor Emeritus, Tohoku University Professor, Hosei University, Graduate School of Law — Takashi Yamashita Corporate Auditor (Full time) Yoshio Iijima Corporate Auditor (Full time) — — Sosuke Yasuda Outside Corporate Auditor Special Advisor, Gyosei & Co. Representative Employee, Gyosei Licensed Tax Accountants Outside Corporate Auditor, Mitsui Sumitomo Insurance Co., Ltd. Outside Corporate Auditor, Nomura Research Institute, Ltd. As a certified public accountant, he has relevant knowledge of accounting and financing. Daiken Tsunoda Outside Corporate Auditor Attorney at Nakamura, Tsunoda, and Matsumoto Outside Corporate Auditor, Atlus Co., Ltd. Outside Corporate Auditor, INES Corp. As an attorney well-versed in corporate law, he has relevant knowledge of accounting and financing.

(Note) 1. The Company adopts an executive officer system. Executive Officers as of March 31, 2010 are as follows:

President & CEO Toshiaki Egashira Vice President Executive Officer Hiromi Asano Marketing and Sales Vice President Executive Officer Kazuo Kondo Underwriting and Financial Agencies Channel Senior Executive Officer Isamu Endo Corporate Management Aide Corporate Planning Dept. (Except Integration Promotion Section) , Business Development Dept., Shareholder Relations & Legal Dept., Internal Audit Dept. Senior Executive Officer Yasuyoshi Karazawa Accounting Dept., Corporate Communications Dept., Integration Planning Committee

Senior Executive Officer Susumu Fujimoto Overseas Business Managing Executive Officer Katsuaki Ikeda General Affaires and Financial Services Business Managing Executive Officer Hitoshi Ichihara Human Resources Dept., Administration and Systems Managing Executive Officer Katsuhiko Kaneyoshi Overseas Business Aide Managing Executive Officer Shuhei Horimoto Corporate Management Aide Compliance Dept., Corporate Risk Management Dept., Internal Audit Dept.

2. Mr. Yoshiaki Shin, Chairman & Director, Mr. Hiromi Asano, Director, Mr.,Isamu Endo, Director, Mr. Hitoshi Ichihara, Director, Ms. Eiko Kono, Director, Mr. Kenji Koroyasu, Director, and Mr. Iwao Taka, Director, resigned from the offices of Director as of March 31, 2010. 3. Mr. Yoshio Iijima, Corporate Auditor, and Mr. Daiken Tsunoda, Corporate Auditor, resigned from the offices of Corporate Auditor as of March 31, 2010. 4. The following changes in Directors, Corporate Auditors and Executive Officers occurred on April 1, 2010. Directors, Corporate Auditors and Executive Officers as of the date is as follows:

Director, President, & CEO Toshiaki Egashira Director, Executive Officer Ichiro Tateyama Assist CEO Director, Executive Officer Tadashi Kodama Assist CEO Director, Executive Officer Yasuyoshi Karasawa Assist CEO Director, Senior Executive Officer Susumu Fujimoto Compliance Dept., Corporate Risk Management Dept., Internal Audit Dept. Mitsui Sumitomo Kirameki Life Insurance Company, Limited., Mitsui Sumitomo MetLife Insurance Co., Ltd., Mitsui Direct General Insurance Co., Ltd. Director, Managing Executive Officer Shuhei Horimoto Corporate Planning Dept., Corporate Communications and Invester Relations Dept., Business Development Dept., Internal Audit Dept. Managing Executive Officer Takayoshi Umemura General Administration Dept., Human Resources Dept., Accounting Dept. Director, Executive Officer Hisahito Suzuki Corporate Management Aide Director, Executive Officer Masanori Yoneda Corporate Management Aide Director, Executive Officer Katsuaki Ikeda Corporate Management Aide Executive Officer Yasuo Kishimoto Financial Services Business Executive Officer Kazuyuki Fujimoto Claims Services

Executive Officer Seiichi Ota Underwriting Executive Officer Shiro Fujii Administrative and Systems Executive Officer Mitsuhiro Tsuchiya Marketing & Sales Outside Director Toshihiko Seki Outside Director Akira Watanabe Outside Director Mitsuhiro Umezu Outside Director Daiken Tsunoda Corporate Auditor (Full time) Takashi Yamashita Corporate Auditor (Full time) Masahiko Oji Outside Corporate Auditor Sosuke Yasuda Outside Corporate Auditor Kuniaki Nomura Outside Corporate Auditor Hiroyuki Tezuka

(2) Compensation to company officers

			Compensation
Category	No. of officers paid		(Millions of yen)
Directors		13		264
Auditors		4		65
Total		17		330

(Note) The Articles of Incorporation stipulate that director compensation shall be kept at or below ¥500,000,000/year (this does not include employee wages when serving concurrently as both employee and director) (compensation for outside directors shall be kept at or below ¥60,000,000 within the above amount), and corporate auditor compensation shall be kept at or below ¥110,000,000/year.

3. Matters Concerning External Officers

(1) Concurrent and other status of external officers

Name Concurrent position or other matters (Outside Directors) Eiko Kono Outside Director, Mitsui Sumitomo Insurance Co., Ltd. Outside Director, HOYA Corporation Outside Director, DIC Corporation Kenji Koroyasu Advisor, TMI Associates Outside Director, Mitsui Sumitomo Insurance Co., Ltd. Outside Director, Central Japan Railway Company Outside Corporate Auditor, Heiwa Corporation Iwao Taka Dean, Reitaku University School, Economics and Business Administration Outside Director, Mitsui Sumitomo Insurance Co., Ltd. Toshihiko Seki Professor Emeritus, Tohoku University Professor, Hosei University, Graduate School of Law (Outside Corporate Auditors) Sosuke Yasuda Special Advisor, Gyosei & Co. Representative Employee, Gyosei Licensed Tax Accountants Outside Corporate Auditor, Mitsui Sumitomo Insurance Co., Ltd. Outside Corporate Auditor, Nomura Research Institute, Ltd. Daiken Tsunoda Attorney at Nakamura, Tsunoda, and Matsumoto Outside Corporate Auditor, Atlus Co., Ltd. Outside Corporate Auditor, INES Corp.

(Note) 1.		Mitsui Sumitomo Insurance Co., Ltd. is a subsidiary of the Company.
2.		Central Japan Railway Company owns shares of the Company.
3.		Nomura Research Institute, Ltd. has business transaction between the Company.
4.		There is no special connection between other entities in which outside directors and outside corporate auditors holds a position.

(2) Primary activities of external officers

			Observations made at Board of
	Term of	Record of attendance to Board	Directors meetings and record of other
Name	office	of Directors meetings	activities
Eiko Kono (Outside Director)	2 year	Attended 11 out of 12 Board of Directors meetings for the current fiscal year.	Made observations at Board of Directors meetings or other meetings as appropriate, based on her extensive experience as a manager and good judgment.
Kenji Koroyasu (Outside Director)	2 year	Attended 11 out of 12 Board of Directors meetings for the current fiscal year.	Made observations at Board of Directors meetings or other meetings as appropriate, based on his knowledge and experience as an attorney and public prosecutor.
Iwao Taka (Outside Director)	2 year	Attended 10 out of 12 Board of Directors meetings for the current fiscal year.	Made observations at Board of Directors meetings or other meetings as appropriate, based on his knowledge and experience as a researcher of corporate ethics and other matters.
Toshihiko Seki (Outside Director)	2 year	Attended all 12 Board of Directors meetings for the current fiscal year.	Made observations at Board of Directors meetings or other meetings as appropriate, based on his knowledge and experience as a legal scholar.
Sosuke Yasuda (Outside Corporate Auditor)	2 year	Attended all 12 Board of Directors meetings and all 11 Board of Corporate Auditors meetings for the current fiscal year.	Made observations at Board of Directors meetings or other meetings as appropriate, based on his knowledge and experience as a Certified Public Accountant.
Daiken Tsunoda (Outside Corporate Auditor)	2 year	Attended all 12 Board of Directors meetings and all 11 Board of Corporate Auditors meetings for the current fiscal year.	Made observations at Board of Directors meetings or other meetings as appropriate, based on his knowledge and experience as a lawyer.

(Note) The term of office for each person is from the date on which he or she assumed office to March 31, 2010.

(3) Limited liability agreements

Name		Summary of content in limited liability agreements
(Outside Directors) Eiko Kono Kenji Koroyasu Iwao Taka Toshihiko Seki (Outside Corporate Auditors) Sosuke Yasuda Daiken Tsunoda		The Company has concluded agreements with each person limiting his or her liability under Article 423, Clause 1 of the Companies Act. The amount of limited liability based on these contracts is the sum of the amounts stipulated in all paragraphs of Article 425, Clause 1 of the Companies Act.

(4) Compensation for external officers

Compensation from the

Compensation from the parent company,

No. of

insurance holding company

etc. of the insurance holding company

officers paid

(Millions of yen)

Total compensation

(Note) 1.		The breakdown of compensation paid by the insurance holding company is ¥35 million for Outside Corporate Directors and ¥13 million for Outside Corporate Auditors.
2.		Four people are paid compensation by the parent company or from other source within the insurance holding company.

(5) External officer opinions

Not applicable.

4. Share Data

(1) Number of shares Total number of issuable shares 900,000 thousand shares Total number of shares issued 421,320 thousand shares

(Note)		Upon the share exchanges which took effect as of April 1, 2010, 139,479 thousand and 72,491 thousand shares of the Company’s common stock are respectively distributed to each shareholder of Aioi and NDGI who was registered on the shareholders’ registry at the point of the share exchanges. As a result, the total number of issued shares after the share exchanges became 633,291 thousand shares.
(2) Number of shareholders at end of current fiscal year 47,956
(3) Major shareholders

	Investment in the Company
	Number of		Ratio to shares
	shares held		held
Names of shareholders	(Thousand)		(%)
Japan Trustee Services Bank, Ltd. (Trust account)		22,975		5.5	%
The Master Trust Bank of Japan, Ltd. (Trust account)		22,418		5.3
The Chase Manhattan Bank N.A. London Secs Lending Omnibus Account		11,555		2.7
State Street Bank and Trust Company 505225		10,336		2.5
Nippon Life Insurance Company		9,964		2.4
NATSCUMCO		9,070		2.2
Mellon Bank, N.A. as Agent for its Client Mellon Omnibus US Pension		6,518		1.5
Sumitomo Life Insurance Company		6,077		1.4
The Bank of New York Mellon as Depositary Bank for DR Holders		5,640		1.3
SSBT OD05 Omnibus Account China Treaty Clients		5,118		1.2

(Note) The Company is omitted from the list above despite its treasury stock of 6,367 thousand shares.

5. Matters Concerning Stock Acquisition Rights

Not applicable.

6. Matters Concerning Accounting Auditor

(1) Accounting auditor

(Millions of yen)

	Compensation for the business
Name or title	year under review		Other
KMPG AZSA & Co. Designated employee: Kimitaka Mori Designated employee: Ikuo Hirakuri Designated employee: Yoshiki Hisano		14	The Company paid KPMG AZSA & Co., compensation for advisory business on financial and taxation due diligence in addition to the businesses listed on the Article 2, paragraph 1 of the Accountants Act.

(Note)	1.		The total amount of money and yield on other assets the Company and its subsidiaries are obligated to pay is ¥257 million.
	2.		No distinction is drawn between audits based on the Companies Act and the amount of compensation for audits under the Financial Instruments and Exchange Law in the audit contract concluded between the Company and the accounting auditor. A practical distinction cannot be made so the above amount includes the amount of compensation for audits based on the Financial Instruments and Exchange Law.

(2)		Limited liability contract
		Not applicable.
(3)		Other matters concerning the accounting auditor
A.		Policy on dismissal or decision to not reappoint the Accounting Auditor

The Company policy with regard to the above is as follows:

In the event the Board of Directors determines it appropriate to dismiss or decide not to reappoint the accounting auditor in cases where is it recognized that it will be difficult for the accounting auditor to execute its duties properly, the approval of the Board of Auditors will be obtained, and a resolution to dismiss or decide not to reappoint the accounting auditor will be presented at a general shareholders meeting.

Should the Board of Auditors decide to dismiss the accounting auditor based on Article 340 of the Companies Act, or in the event it is recognized that it will be difficult for the accounting auditor to perform its duties or other such circumstances, and the Board of Auditors has determined it appropriate to dismiss or not to reappoint the accounting auditor, the Board of Auditors will follow the procedures for dismissing or not reappointing the accounting auditor, based on Article 344 of the Companies Act.

B. Auditing of the financial statements of the Company’s principal subsidiaries done by certified public accountants other than the Company’s accounting auditor

Such principle subsidiaries as MSI Corporate Capital Limited and Mitsui Sumitomo Insurance Company of America are audited by certified public accountants other than KPMG AZSA & Co.

7. Basic Policy on the Conduct of Persons who Assume Control of Decisions on Finance and Business Policy

Not applicable.

8. System for Ensuring Proper Conduct of Business

A summary of the resolution passed by the Board of Directors regarding the establishment of the above system follows:

(1) System for ensuring proper conduct of operations in the corporate group consisting of the Company and its subsidiaries

Compliance with the basic policies of the group based on the business management contract concluded with domestic insurance companies in the group is required, along with seeking the Company’s approval and reporting to the Company on important matters involving domestic insurance companies in the group. Subsidiaries of domestic insurance subsidiaries in the group shall, as a general rule, be managed appropriately by the subsidiary in control, based on the business management contract.

(2) System to ensure effective execution of director duties

In order to balance the conflicting demands of making quick decisions and monitoring decisions appropriately, the Company has introduced the executive officers system, appointed outside directors, and has also stipulated that the number of directors be 15 or fewer.

(3) System to ensure that director and employee conduct in the execution of their duties is in compliance with laws and regulations and with the Articles of Incorporation

(i) In accordance with the MS&AD Insurance Group Basic Policy on Compliance set out by the Holding Company’s Board of Directors, the Company and its Group companies shall make sure that each and every director and employee is aware of the importance of compliance, ensure compliance with all applicable legislation and internal regulations, etc. and maintain high ethical standards as part of all business activities. The Company will also work to establish a system to eliminate anti-social forces and strive to ensure that all officers and employees adopt a resolute attitude toward anti-social forces and refuse to give in to unjust and unwarranted demands.

(ii) In order to ensure the promotion of compliance within the Company and the Group, an organizational structure has been established that includes a central compliance department that regularly reports to the Board of Directors on the status of and progress in ensuring compliance throughout the entire Group. It shall set Risk Compliance Committee and take necessary measures on issues identified by it, and monitor compliance promotion. An internal reporting structure for the Group will also be established to provide for a direct route of reporting from all officers and employees to the internal company contact and to an external lawyer, so that any improper, illegal, or unethical act by the organization or an individual can be reported directly.

(4) Regulations and other systems for management of the risk of loss (integrated risk management system)

(i) The Company has established an organizational structure that includes a Corporate Risk Management Department that regularly reports to the Board of Directors on all Group risks and risk management in order to exercise appropriate integrated risk management, in addition to sharing the fundamental views of the Company throughout the Company and Group companies in accordance with the MS&AD Insurance Group Basic Policy on Group Risk Management. It shall set Risk Compliance Committee and take necessary measures on issues identified by it, and monitor risks and the management of risk. The requisite steps will be taken to avoid and reduce risk based on the results of deliberation within the committee (including thorough verification of the combined total equity of the Company and the Group).

(ii) The Company will establish plans for crisis management and ensuring the continuance of business for the entire Group in addition to verifying the existence of crisis

management and business continuance plans for Group companies.

(5) System for ensuring the reliability of financial reports

At least one of the auditors appointed will have sufficient knowledge of management and finances. A system will also be established to ensure proper and timely disclosure of financial or other information pertaining to the Group, in accordance with the MS&AD Insurance Group Basic Policy on Disclosure Regulation. The Information Disclosure Committee will verify the effectiveness of controls on information disclosure and the existence and employment of internal controls for financial reporting in both the Company and the Group.

(6) System to ensure the effectiveness of internal audits

An internal audit system has been established for all Group administrative activities in accordance with the MS&AD Insurance Group Basic Policy on Internal Audits to implement internal audits efficiently and effectively. The Internal Audit Department reports to the Board of Directors on important findings from the results of internal audits conducted for the Company and domestic insurance companies in the Group and provides a status report on improvements made by the entity audited.

(7) System for retaining and managing information regarding the execution of duties by directors

Written documents and other information pertaining to the execution of duties by directors and executive officers will be retained and managed appropriately, in accordance with the Rules on Document Management. This information must all be available for consultation by directors and auditors.

(8) System to ensure that audits by the Corporate Auditors are carried out effectively

(i) Matters concerning the system for employees requested by the auditor to assist with auditor duties and pertaining to the independence of such employees from directors

A Corporate Auditor’s Office has been established and employees will be specifically assigned to the Corporate Auditor’s Office to assist with the duties of the auditor. The approval of the Board of Auditors will be obtained when making organizational changes to the Corporate Auditor’s Office or transferring or taking disciplinary action against the above-noted employees. Personnel evaluations will also be conducted after consultation with an auditor designated by the Board of Corporate Auditors.

(ii) System for directors and employees to report to the auditor and a system for other reporting to the auditor

Directors and executive officers will report to the Board of Corporate Auditors without delay on legally stipulated matters as well as decisions that will have a serious impact on the business and organization, the results of internal audits conducted, and the status and content of reports made via the internal reporting system. Employees shall be able to report directly to the Board of Corporate Auditors on serious acts of impropriety or illegality in management or facts that may cause serious damage to the company.

(iii) System to ensure that other audits by auditors are conducted effectively

The auditor will attend important meetings of the Group Management Committee. The President and Director, and the Representative Director will exchange opinions with the Board of Corporate Auditors on a regular basis and the Internal Audit Department will cooperate with audits by the corporate auditor.

9. Matters Concerning Accounting Advisors

Not applicable.

10. Other Matters

Not applicable.

CONSOLIDATED BALANCE SHEET (As of March 31, 2010)

(Millions of yen)

Items	Amount
(Assets)
Cash deposits and savings		313,389
Call loans		33,700
Securities bought under resale agreements		15,998
Monetary claims bought		108,158
Money trusts		10,592
Investments in securities		5,497,537
Loans		749,524
Tangible fixed assets		255,039
Land		100,852
Buildings		129,358
Construction in process		4,427
Other tangible fixed assets		20,400
Intangible fixed assets		78,967
Software		11,927
Good will		63,004
Other intangible fixed assets		4,035
Other assets		459,454
Deferred tax assets		6,411
Bad debts reserve		-9,149
Total Assets		7,519,625
Items	Amount
(Liabilities)
Underwriting funds		5,781,233
Outstanding claims		753,784
Underwriting reserve		5,027,448
Bonds		94,969
Other liabilities		198,587
Reserve for annuity and retirement benefits		82,424
Reserve for retirement benefits for directors and corporate officers		2,092
Accrued bonuses for employees		12,713
Reserve under the special laws		4,302
Reserve for price fluctuation		4,302
Deferred tax liabilities		32,221
Total Liabilities		6,208,542
(Net Assets)
Common stock		100,000
Capital surplus		132,690
Retained earnings		541,520
Treasury stock		-14,687
Total shareholders’ equity		759,522
Unrealized gains on investments, net of tax		582,980
Deferred hedge gains/losses, net of tax		2,138
Foreign currency translation adjustments		-40,309
Total valuation and translation adjustments		544,809
Minority interests		6,750
Total Net Assets		1,311,082
Total Liabilities and Net Assets		7,519,625

CONSOLIDATED STATEMENT OF INCOME (From: April 1, 2009) (To: March 31, 2010)

(Millions of yen)

Items	Amount
Ordinary income:		1,962,689
Underwriting income:		1,812,669
Net premiums written		1,394,164
Deposit premiums from policyholders		145,026
Investment income on deposit premiums from policyholders		54,075
Life insurance premiums		135,165
Reversal of outstanding claims		49,876
Reversal of underwriting reserves		31,417
Other underwriting income		2,942
Investment income:		139,902
Interest and dividends received		143,896
Investment gains on money trusts		675
Gains on sale of securities		19,695
Gains on redemption of securities		1,727
Gains on derivative transactions		24,777
Other income from investments		3,206
Transfer of investment income on deposit premiums from policyholders		-54,075
Other ordinary income:		10,118
Equity in gains of affiliates		4,878
Other ordinary income		5,239
Ordinary expenses:		1,909,994
Underwriting expenses:		1,561,117
Net claims paid		914,691
Loss adjustment expense		80,547
Commission and collection expense		243,136
Maturity refunds to policyholders		278,423
Dividends to policyholders		1,062
Life insurance claims		41,716
Other underwriting expense		1,538
Investment expenses:		47,021
Investment losses on money trusts		21
Losses on sale of securities		17,419
Valuation losses on securities		6,065
Loss on redemption of securities		4,435
Other investment expense		19,079
Operating expenses and general and administrative expenses:		294,960
Other ordinary expenses:		6,894
Interest paid		2,254

Items	Amount
Provision for bad debt		2,044
Loss on bad debt		131
Other ordinary expenses		2,463
Ordinary Profit		52,695
Extraordinary income:		3,592
Gain on sales of fixed assets		3,592
Extraordinary losses:		6,048
Losses on sales of fixed assets		2,555
Impairment loss		3,431
Reversal of reserve under the special law		61
Reversal of reserve for price fluctuation		61
Income before income taxes		50,238
Income taxes		18,778
Reversal of income taxes from previous year		-13,950
Income taxes adjustments		7,330
Total income taxes		12,158
Minority interests		439
Net income		37,640

CONSOLIDATED STATEMENT OF CHANGES IN NET ASSETS (From: April 1, 2009) (To: March 31, 2010)

(Millions of yen)

Items	Amount
Shareholder’s equity
Common stock
Balance as of March 31, 2009		100,000
Balance as of March 31, 2010		100,000
Capital surplus
Balance as of March 31, 2009		132,689
Change this year
Disposal of treasury stock		0
Total change this year		0
Balance as of March 31, 2010		132,690
Retained earnings
Balance as of March 31, 2009		527,578
Change this year
Dividend of retained earnings		-22,641
Change of scope of consolidation		-1,055
Net income for this year		37,640
Total change this year		13,942
Balance as of March 31, 2010		541,520
Treasury stock
Balance as of March 31, 2009		-4,644
Change this year
Acquisition of treasury stock		-10,048
Disposal of treasury stock		4
Total changes this year		-10,043
Balance as of March 31, 2010		-14,687
Total shareholder’s equity
Balance as of March 31, 2009		755,623
Change this year
Dividend of retained earnings		-22,641
Change of scope of consolidation		-1,055
Net income for the year		37,640
Acquisition of treasury stock		-10,048
Disposal of Treasury stock		5
Total change this year		3,899
Balance as of March 31, 2010		759,522
Valuation and translation adjustments
Valuation differences of other marketable securities
Balance as of March 31, 2009		295,558
Change this year
Change (net) this year on items other than shareholders’ equity		287,422

Items	Amount
Total change this year		287,422
Balance as of March 31, 2010		582,980
Deferred hedge profits/losses
Balance as of March 31, 2009		9,671
Change this year
Change (net) this year on items other than shareholders’ equity		-7,532
Total change this year		-7,532
Balance as of March 31, 2010		2,138
Foreign currency translation adjustments
Balance as of March 31, 2009		-49,625
Change this year
Change (net) this year on items other than shareholders’ equity		9,316
Total change this year		9,316
Balance as of March 31, 2010		-40,309
Total valuation and translation adjustments
Balance as of March 31, 2009		255,603
Change this year
Change (net) this year on items other than shareholders’ equity		289,206
Total change this year		289,206
Balance as of March 31, 2010		544,809
Minority interests
Balance as of March 31, 2009		11,794
Change this year
Change (net) this year on items other than shareholders’ equity		-5,044
Total change this year		-5,044
Balance as of March 31, 2010		6,750
Total net assets
Balance as of March 31, 2009		1,023,021
Change this year
Dividend of retained earnings		-22,641
Change of scope of consolidation		-1,055
Net income for this year		37,640
Acquisition of treasury stock		-10,048
Disposal of treasury stock		5
Change (net) this year on items other than shareholders’ equity		284,161
Total change this year		288,060
Balance as of March 31, 2010		1,311,082

CONSOLIDATED EXPLANATORY NOTES

(Matters of Significance that are Fundamental to the Preparation of Consolidated Financial Reports)

The Company’s consolidated financial reports are prepared in conformity with the Ordinance for Enforcement of Insurance Business Law pursuant to the provisions of the Corporate Accounting Regulations and Article 118 of the said Regulations. The definitions of subsidiary and affiliated company are also based on Article 2 of the Corporate Accounting Regulations.

1. Matters concerning Scope of Consolidation

(1) Number of consolidated subsidiaries: 36

Names of principal consolidated subsidiaries:

Mitsui Sumitomo Insurance Co., Ltd. Mitsui Sumitomo Kirameki Life Insurance Co., Ltd. MSIG Holdings (Americas), Inc. Mitsui Sumitomo Insurance (London Management) Ltd MSIG Mingtai Insurance Co., Ltd.

Due to the Company having newly established MSIG Insurance (Lao) Co., Ltd., this firm has been included in the scope of consolidation from the current fiscal year.

On the contrary, Mitsui Sumitomo Insurance Company (Hong Kong) Limited and Thousand Fortune Islands Corporation has been excluded from the scope of consolidation from the current fiscal year, due to loss of importance from business reorganization for the former and for the latter, redemption of its debentures the Company held which made the Company its parent company since the Company covered more than half the amount of its financing.

(2) Unconsolidated subsidiaries

Names of principal unconsolidated subsidiaries:

MITSUI SUMITOMO INSURANCE Claims Adjusting Company, Limited MITSUI SUMITOMO INSURANCE Staffing Service Company, Limited

A company that is designated an unconsolidated subsidiary is one that has limited significance to the extent that it does not affect reasonable decisions regarding financial conditions and business results of the corporate group, in light of the amounts equivalent to interests in its total assets, ordinary income, net income and retained earnings.

(3) The Company owns 51% of the voting rights in Mitsui Sumitomo MetLife Insurance Co., Ltd. However, Mitsui Sumitomo MetLife Insurance Co., Ltd. is under joint control with another company and thus is not considered to be a subsidiary.

2. Matters concerning the Equity Method

(1) Number of equity method affiliates: 4

Names of principal companies:

Mitsui Sumitomo MetLife Insurance Co., Ltd. Sumitomo Mitsui Asset Management Co., Ltd.

(2) As the impact of unconsolidated subsidiaries and affiliated companies not accounted for by the equity method (MITSUI SUMITOMO INSURANCE Staffing Service Company, Limited, BPI/MS Insurance Corporation, etc.) on consolidated net income/losses and consolidated retained earnings is negligible and there is no significance in the consolidated business results, they are excluded from a company accounted for by the equity method.

3. Matters concerning the Accounting Years of Consolidated Subsidiaries

The final day of the business year for MSIG Holdings (Americas), Inc. and 31 other consolidated subsidiaries is December 31 for financial reporting purposes. In preparing these consolidated financial reports, we use the financial reports for the business year of the

consolidated affiliates in question because the variance with the final date of the consolidated accounting year does exceed 3 months.

We make adjustments significant to consolidation for important transactions made during the period of variance with the final day of the consolidated accounting year.

4. Matters concerning Accounting

(1) Standards and methods of valuation for securities (including items classified as “Cash deposits and savings” or “Monetary claims bought” under the Enforcement Regulations for the Insurance Business Law)

(i)Valuations of held-to-maturity securities are according to the depreciation cost method.

(ii)Valuations of shares of unconsolidated subsidiaries and affiliated companies not accounted for by the equity method are according to the cost method on a moving average cost basis.

(iii)Valuations of “underwriting reserve supported bonds” in accordance with the “Interim Handling for Accounting and Auditing of the “underwriting reserve supported bonds” in the Insurance Industry” (Report No. 21 issued by the Industrial Classification Audit Committee, The Japanese Institute of Certified Public Accountants, November 16, 2000) are according to the depreciation cost method on a moving average cost basis.

A summary of the newly established risk management policy for underwriting reserve supported bonds is as follows:

The Company is establishing a small segment of the “lump-sum payment old-age insurance” that was launched at a consolidated life insurance subsidiary to appropriately manage fluctuation risks for the interest accruing on its assets and the owed interest accruing on its liabilities, and will adopt an operating policy of matching the duration of the underwriting reserve supported bonds with the underwriting reserve during fixed intervals.

(iv) Valuations of marketable securities classified as other securities are according to market value as of the end of the fiscal year under review with changes in unrealized holding gain or loss, net of the applicable income taxes, included directly in net assets. The cost of securities sold is also calculated by the moving average method.

(v) Valuations of securities classified as other securities of which price are extremely difficult to be determined are according the depreciation cost method on a moving average cost basis.

(vi) Valuations of securities managed as trust assets and included in money trusts that are independently managed mainly for the purpose of securities investment are according to the market price method.

(Change in principles of accounting methods and accounting procedures)

Application of “Accounting Standard for Financial Instruments”

The scope of marketable securities has been changed from this current fiscal year applying “Accounting Standard for Financial Instruments” (Corporate Accounting Standard No.10 (last amended on March 10, 2008)). Application of the accounting standard has little influence on the consolidated financial statements.

(2) Standards and method of valuation for derivative transactions

Valuations of derivative transactions made by the Company and its consolidated subsidiaries are done according to the market price method. However, derivative transactions that fulfill the requirements for transfer treatment permitted for exchange transactions are accounted for with the use of transfer treatments, and derivative transactions that fulfill the requirements for the exceptional treatment permitted for interest rate swaps are accounted for with the use of exceptional treatments.

(3) Method of valuation of significant depreciable assets

(i) Tangible fixed assets

Depreciation of tangible fixed assets held by the Company’s domestic consolidated subsidiaries is computed using the declining-balance method, except for buildings (excluding fixtures) acquired on and after April 1, 1998, for which the straight-line method is applied. Depreciation of tangible fixed assets held by overseas consolidated subsidiaries is principally computed using the straight-line method methods.

(ii) Intangible fixed assets

Depreciation of software used by the Company is computed using the straight-line method based on the estimated period of use.

(4) Basis for significant allowances

(i) Bad debts reserve

The Company’s domestic consolidated insurance subsidiaries provide for bad debt reserves in preparation for possible losses on doubtful receivables at an amount determined according to standards for self-appraisal of assets and standards for depreciation and provisions of reserves as follows.

With respect to receivables from debtors who were known to have suffered from collapse of management for whatever reason, legally or as a matter of form such as through bankruptcy, special liquidation or suspension of any transaction at the note exchanges or who fell substantially into collapse of management, a reserve is provided for by an amount equivalent to the balance obtained by deducting the amount expected to be realized by the enforcement of mortgage and the amount potentially collected through the enforcement of guarantees from the amount of the receivables.

With respect to receivables from debtors who were deemed highly likely to fall into collapse of management, a reserve is provided for by an amount deemed necessary upon overall judgment of their liquidity out of the amount equivalent to the balance obtained by deducting an expected amount to be realized by the enforcement of mortgage and the amount possibly collected by the enforcement of a guarantee from the amount of receivables.

With respect to receivables other than those stated above, a reserve is provided for by the amount obtained by multiplying the amount of the receivables by a bad debt rate calculated on the basis of the amount of written-off receivables in a specific period in the past.

The enforcement division provided for in the asset self-appraisal enforcement regulations has conducted an appraisal of all assets based on the standards for self-appraisal of assets and the reserves stated above have been provided for by the respective amounts based on the results of the above appraisal.

Other domestic consolidated subsidiaries have conducted an appraisal of assets for all receivables based on similar standards for self-appraisal of assets of the Company’s domestic consolidated insurance subsidiaries and provided for the amount necessary for losses on bad debts based on such appraisal results.

For foreign consolidated subsidiaries, we provide an estimated amount for losses on bad debts in consideration of the collectibility of individual receivables.

(ii) Reserve for retirement benefits for employees

To provide a reserve for the retirement benefits of employees, an amount recognized as incurred at the end of the consolidated fiscal year is calculated based on the estimated amount of benefits obligations and plan assets as of March 31, 2009.

Prior service cost is amortized as incurred by the straight-line method over the average remaining years of service of the employees.

Actuarial gains or losses are amortized in the year following the year in which such difference occurred by the straight-line method over the average remaining years of services of the employees.

Some consolidated subsidiaries adopt the simplified tax effect accounting method for the purpose of calculating the retirement benefit obligations.

(Change in principles of accounting methods and accounting procedures)

Application of “3rd Amendment to “Accounting Standard for Retirement Benefits””

“3rd Amendment to “Accounting Standard for Retirement Benefits”” (Corporate Accounting Standard No.19 (last amended on July 31, 2008)) has been applied from this current fiscal year. Application of the accounting standard has no influence on the consolidated financial statements, since the same reduction rate as the former method is applied.

(iii) Reserve for retirement benefits for directors and corporate auditors

Mitsui Sumitomo Insurance Co., Ltd. and Mitsui Sumitomo Kirameki Life Insurance Co., Ltd. provide for future retirement benefits (including pensions) paid to Directors,

Corporate Auditors, and Executive Officers. This amount is equivalent to the compensation for the performance of their duties as Directors, Corporate Auditors and Executive Officers during the respective terms of office prior to March 31, 2005, when the retirement grants system was abolished.

(iv) Accrued bonuses

Accrued bonuses for employees and executive officers are calculated based on the estimated benefit amount payable at the end of the consolidated business year.

(v) Reserve for price fluctuation

The Company’s domestic consolidated insurance subsidiaries provide a reserve for price fluctuation for losses arising out of fluctuations in prices of shares under the provisions of Article 115 of the Insurance Business Law.

(5) Important translation standard for assets and liabilities denominated in foreign currencies

Assets and liabilities denominated in foreign currencies are translated into Japanese yen at the rate on the spot rate exchange as of the consolidated balance sheet date. Unrealized translation gain or loss is stated as income or loss. Assets and liabilities of overseas consolidated subsidiaries are also translated into Japanese yen at the rate on the spot rate exchange as of the end of the fiscal year, and income and expenses are translated into Japanese yen at the rate of the average exchange during the fiscal year. Unrealized translation gain or loss is stated as translation adjustments and minority interests in the net assets category of the consolidated financial statements.

(6) Processing method for consumption taxes

Consumption tax is accounted for under the tax exclusive (zei nuki) method by the Company and domestic consolidated subsidiaries except for such relating to loss adjustment expenses, and operating expenses and general and administrative expenses for domestic consolidated non-life insurance subsidiaries, which are accounted for under the “tax inclusive (zei komi) method by the Company. Non-deductible consumption tax relating to assets is included in suspense payments and amortized in equal installments over a period of 5 years.

(7) Processing method for important lease transactions

From the consolidated fiscal year starting April 1, 2008, non-ownership transfer finance lease transactions are accounted for as operating leases in conformity with the normal method for lease transactions.

(8) Method of important hedge accounting

Mitsui Sumitomo Insurance Co., Ltd. accounts for stock transfer contracts for hedging risks arising from stock price fluctuations under the deferral hedge accounting method. Currency swap contracts for hedging foreign exchange risks related to foreign-denominated bonds are accounted for under the deferral hedge accounting method, and some forward exchange contracts are accounted for under the fair value hedge accounting method or subject to appropriation. Interest rate swap contracts for hedging risks arising from fluctuations in cash flow of loans or bonds relating to fluctuations in interest rates are accounted for using the deferral hedge accounting method or the exceptional method.

Hedging effectiveness is also assessed quarterly by comparing the cumulative fluctuations in prices or cash flows between the hedged items and the hedging instruments during the periods from the hedging start dates to the assessment dates. But when hedged items and hedging instruments are highly and clearly interrelated or when interest swap transactions meet the criteria for applying the exceptional method, the assessments for the effectiveness of hedging are omitted.

Report by Industry: No. 26 (Japanese Institute of Certified Public Accountants, September 3, 2002). The assessment of the effectiveness of the hedges is carried out by examining the state of interest rates that affect the calculation of the theoretical price of both the hedged items and the hedging instrument.

5. Matters concerning Valuation of Assets and Liabilities of Consolidated Subsidiaries

Valuation of assets and liabilities of consolidated subsidiaries is carried in the entirely at the total market price method.

6. Matters concerning Amortization of Goodwill and Negative Goodwill

Goodwill is amortized in equal installments over 20 years. However, goodwill in small amounts is amortized in a lump-sum in the year that it is recognized.

(Consolidated Balance Sheet)

1. The cumulative amount of depreciation intangible fixed assets is ¥286,738 million, and the advanced depreciation amount is ¥18,713 million.

2. The shares of non-consolidated subsidiaries and affiliated companies are as follows:

Securities (stock):	¥	28,577 million
Securities (foreign securities):	¥	7,972 million
Securities (other securities):	¥	6,164 million

3. The amount of loans to financially impaired parties, overdue loans, loans overdue by no less than three months, restructured loans, and the total amount thereof are as follows:

(1) Loans to financially impaired parties and overdue loans mount to ¥1,441 million and ¥2,426 million, respectively.

Loans to financially impaired parties mean the loans without accrued unpaid interest (defined below), with respect to which such event as provided for in Article 96, Paragraph 1, Items 3-(a) through (e), or Item 4 of the Corporation Tax Enforcement Order (Government Ordinance No. 97, 1965) (provision limit for bad debt reserve) has occurred. The Loans without accrued unpaid interest represent those loans on which accrued interest receivable is not recognized because repayments of principal or interest were overdue for considerable periods and they are regarded as uncollectible (excluding the portion of loans that were written off) (hereinafter referred to as the “Loans without accrued unpaid interest”).

Overdue loans represent loans without accrued unpaid interest except for loans to financially impaired parties and loans that have been granted grace for interest payments for the purpose of restructuring the debtor, or supporting the debtor in financial difficulty.

(2) Among loans receivables, receivables in arrears for three months or more amounts to ¥855 million.

Receivables in arrears for three months or more mean loans receivable for which payment of principal or interest is in arrears for three months or more from the day next following the stated payment date and which do not fall under receivables from debtors who are under collapse of management or receivables in arrears.

(3) Among loans receivables, receivables to which eased loan conditions were granted amount to ¥2,043 million.

Receivables to which eased loan conditions were granted mean loans receivable for which such arrangements as will be favorable to debtors including reduction or exemption of interest, postponement of interest payment or grant of grace period for the principal, abandonment of debts or others have been made, and which do not fall under receivables from debtors who are under collapse of management, receivables in delay or receivables in arrears for 3 months or more.

(4) Total of receivables from debtors who are under collapse of management, receivables in delay, receivables in arrears for three months or more, and receivables to which eased conditions were granted amounts to ¥6,766 million.

4. Assets pledged as collateral comprise the security for deposits of ¥76,040 million, cash, deposits and savings of ¥3,335 million and tangible fixed assets of ¥244 million. These are mainly deposited assets for overseas operations and deposited securities for the Real-Time Gross Settlement (RTGS) system of the current account at the Bank of Japan.

5. Investment securities include loans in the aggregate amount of ¥39,791 million by a loan for consumption agreement.

6. Details of retirement benefits are as follows:

(1) Details of retirement benefit obligation:

Projected retirement benefit obligation	-¥	269,473 million
Plan assets	¥	153,654 million
Unfunded obligation	-¥	115,818 million
Unrecognized actuarial losses	¥	33,394 million
Reserve for annuity and retirement benefits	-¥	82,424 million

(2) Actuarial assumptions of retirement benefit obligation:

Allocation method of retirement benefits		Straight-line method
Discount rate		Typically 2.00%
Rate of expected return on plan assets		Typically 3.00%
Amortization period for actuarial losses
Former qualified pension plan		4 years
Other than those stated above		10 years

Mitsui Sumitomo Insurance Co., Ltd.’s former qualified pension plan was also transferred to the fund-type defined benefit corporate pension plan on April 1, 2006.

7. Mitsui Sumitomo Insurance Co., Ltd. is guaranteeing the execution of transactions that limited partnerships undertake. The total present value of such transactions covered by this guarantee as of March 31, 2010 amounts to ¥177,933 million, but they have not been reckoned as customer liabilities under acceptance and guarantees or as liabilities under acceptance and guarantees because there is no substantial guaranteed amount taking account of collaterals.

8. The Company has entered into an agreement with Mitsui Sumitomo Insurance Co., Ltd. to maintain net assets with Mitsui Sumitomo MetLife Insurance Co., Ltd., an affiliated company of ours, in order to provide funds in case the amount of net assets of that company is lower than specified standards or current assets are insufficient for the payment of loans. Total liabilities of Mitsui Sumitomo MetLife Insurance Co., Ltd. as of March 31, 2010 amount to ¥3,081,115 million (including underwriting funds of ¥3,068,340 million) and total assets amount to ¥3,116,508 million.

The agreement is not intended to guarantee the payment of liabilities of Mitsui Sumitomo MetLife Insurance Co., Ltd. As of March 31, 2010, net assets of Mitsui Sumitomo MetLife Insurance Co., Ltd. were higher than the specified standards and there was no insufficiency in current assets.

9. The balance of loans un-extended for loan commitment agreements is ¥1,856 million.

10. Matters relating to financial instruments are outlined below.

(1) Matters relating to status of financial instruments

(i) Policy regarding financial instruments

maturity repayments, and cancellation returns, Mitsui Sumitomo Insurance Co., Ltd. is endeavoring to insure the stability of returns on investment and the security of assets by continually adopting measures to improve risk management methods, such as the promotion of asset liability management (ALM) that takes into account the characteristics of these liabilities. In addition, the basic policy of Mitsui Sumitomo Kirameki Life Insurance Co., Ltd. is to secure stable earnings over the long term by placing the utmost priority on security while focusing on ALM.

Furthermore, the Group’s cash inflows are derived from insurance business earnings and asset management earnings, which are strongly influenced by changes in the external environment such as natural disasters and trends in financial markets. In order to enhance the efficiency of funds operations in a variety of environments, Mitsui Sumitomo Insurance Co., Ltd. raises funds through such means as issuing corporate and short-term bonds in response to needs.

(ii) Description of financial instruments and associated risks

The financial instruments held by the Group are mainly marketable securities, including government bonds and corporate debentures, equities, and foreign bonds, as well as additional instruments such as loans. The Group mainly holds marketable securities as “other securities”, based on their purpose, while some marketable securities are held as “securities held to maturity.” In addition, Mitsui Sumitomo Kirameki Life Insurance Co., Ltd. holds bonds that act as reserves matched to payout of insurance policies. Risks related to asset management comprise market risk based on fluctuation in interest rates, share prices, and exchange rates, etc., credit risk pertaining to issuers of marketable securities and loan counterparties, and liquidity risk where losses can be incurred due to unavoidable transactions at remarkably low prices because of a crash in the market and so forth.

Since hedge accounting is not applicable to derivative transactions, Mitsui Sumitomo Insurance Co., Ltd. uses interest rate swap agreements to control interest rate risk, and currency exchange contracts and currency options trading to hedge against exchange rate risk. Taking the risks inherent in certain transactions into consideration, the company maximizes returns by using interest rate-related, currency-related, equity-related, and bond-related derivative transactions, credit derivative transactions, and weather derivative transactions, etc. In addition, Mitsui Sumitomo Kirameki Life Insurance Co., Ltd. uses forward exchange transactions to appropriate funds for trading of securities in foreign currencies and interest rate receipts.

Please refer to “Matters of Significance that are Fundamental to the Preparation of Consolidated Financial Report, 4. Matters concerning Accounting, (8) Method of important accounting” for more information on derivatives where hedge accounting is applied.

Derivatives entail two types of risk—risk of changes in the market value of the commodity or in the value of underlying asset traded in the derivative (market risk) and risk of fluctuations in the derivative instrument itself. These transactions also encompass risk related to the performance of contracts due to the insolvency, etc. of counterparties (credit risk). The derivative transactions that the Group makes also similarly encompass market risk, related to fluctuation in the prices of the underlying products. However, market risk is offset because market values on underlying assets and their derivatives move in opposite direction on trading that is done for hedging purposes. In addition, to avoid credit risk related to the non-performance of contracts, the Group diversifies its trading among financial institutions, the majority of which have very high credit ratings.

(iii) Risk management systems related to financial instruments

The Group has set limits on authority with respect to overall trading as well as standards on risk management. It conducts all investment and asset management transactions within

these constraints while Mitsui Sumitomo Insurance Co., Ltd. and Mitsui Sumitomo Kirameki Life Insurance Co., Ltd. systematically check the daily activities, ensuring separation of duties by keeping back-office administration separate from risk management. It also monitors activities to ensure that operations, types of products, holding limits, risk amounts, and the handling of losses, etc. are done in accordance with regulations. Furthermore, risk management departments evaluate and analyze risks and regularly report on the status of risks to the Board of Directors and other bodies.

a. Management of market risk

The Group has established and operates a risk management system based on the characteristics of assets, in accordance with management regulations relating to market risk, etc. Mitsui Sumitomo Insurance Co., Ltd. and Mitsui Sumitomo Kirameki Life Insurance Co., Ltd. have established management regulations and a clear set of procedures for each area of investment as well as appropriate limits on amounts held or loss limits as needs arise for both the risk management departments and departments that conduct the trading. Furthermore, the risk management department conducts sensitivity analyses relating to changes in interest rates, exchange rates, and share prices, and measures the VaR (Value at Risk) of market risk. Through these and other activities, they evaluate and manage risks in a multifaceted way.

b. Management of credit risk

The Group, in accordance with management standards relating to credit risk, has a system of credit risk management. Mitsui Sumitomo Insurance Co., Ltd. and Mitsui Sumitomo Kirameki Life Insurance Co., Ltd. manage the credit risks of issuers of marketable securities and counterparty risk in derivative transactions in departments that execute such transactions and risk management departments by regularly evaluating credit information and market prices. With regard to loans, Mitsui Sumitomo Insurance Co., Ltd. has established a credit management system to examine the creditworthiness of each loan, set limits, manage credit information, rate loans internally, set limits on guarantees and collateral, and to handle problem loans and other such issues in departments that execute such transactions and in the risk management departments.

c. Management of liquidity risk

The Group divides cash flow conditions into two types—normal and crisis—and manages cash and conducts its operations with consideration to the level of liquidity appropriate to each type of cash flow condition. To maintain and ensure adequate liquidity in a changing environment, the Group adopts diverse strategies in raising funds. Furthermore, in preparation for the occurrence of unforeseen situations such as a decline in market liquidity stemming from a huge natural disaster or confusion in financial markets, the Group manages liquidity risk by holding and monitoring sufficient cash-on-hand and highly liquid marketable securities such as government bonds.

(iv) Supplementary explanation regarding the market value of financial instruments, etc.

The market value of financial instruments is based on market price, but may also include a reasonable calculation of value when the value cannot be derived by the market. The Group adopts certain assumptions in these calculations, and the values may change as assumptions change.

(2) Matters relating to market value of financial instruments, etc.

Consolidated balance sheets as of March 31, 2010, market values and comments regarding variances follows. Assets whose market value cannot be easily determined have not been included in this table. (See (Note) 2)

	Amount on
	consolidated
	balance sheet		Market value		Difference
	(Millions of		(Millions of		(Millions of
	yen)		yen)		yen)
(i) Cash, deposits and savings		313,389		313,389		—
(ii) Call loans		33,700		33,700		—
(iii) Receivables under resale agreements		15,998		15,998		—
(iv) Monetary claims bought		108,158		108,158		—
(v) Money trust		10,592		10,592		—
(vi) Securities
Securities held to maturity		506,307		518,930		12,622
Securities earmarked for policy reserve		4,196		4,405		208
Other securities		4,809,785		4,809,785		—
(vii) Loans		749,524
Bad debt reserve (*1)		4,014
		745,509		753,655		8,145
Total assets		6,547,639		6,568,616		20,976
Corporate bonds		94,969		98,150		3,180
Total debts		94,969		98,150		3,180
Derivative transactions (*2)
Hedge accounting unapplied		[6,118]		[6,118]		—
Hedge accounting applies		3,895		3,895		—
Total derivative transactions		[2,222]		[2,222]		—

(*1)		General provisions for loan losses and individual provisions for loan losses have been deducted.
(*2)		Derivative transactions posted under other assets and other liabilities are shown on a lump-sum basis. Net debts and credits produced by derivative transactions are shown in net amounts and, in the total, items that are net debts are shown in [ ].
(Note) 1.		Methods used to calculate market value of financial instruments

Assets

(i) Cash and deposits

The market value of deposits is essentially the same as book value; therefore, deposits are recorded according to the book value.

(ii) Call loans

The market value of call loans is essentially the same as book value; therefore, call loans are recorded according to the book value.

(iii) Receivables under resale agreements

The market value of receivables under resale agreements is essentially the same as book value; therefore, the receivables are recorded according to the book value.

(iv) Monetary claims

The market value of monetary claims is essentially the same as book value; therefore, monetary claims are recorded according to the book value. Amounts for monetary claims other than commercial paper shown in the table are the amounts provided by the transacting financial institution.

(v) Money trusts

In the case of money trusts, market value is based on prices indicated by trust banks.

(vi) Marketable securities

The market value of equities is based on stock exchange prices and the market value of bonds is based on trading exchange prices or prices indicated by information providers. In addition, the market value of some bonds is based on prices indicated by the transacting financial institutions.

(vii) Loans

As long as there is no material change in the credit of the borrower, the market value of the loans with variable interest rate, which reflects the market interest rate in the short term, is essentially the same as the book value, so the market rate is set at book value. On loans with fixed rate, loans are first classified according to type, maturity, and credit risk; then the present value is determined by discounting future cash flow at a rate derived from applying a credit spread to the appropriate index on government treasuries. The value of a portion of personal loans is determined by discounting future cash flow for each type of instrument at a rate, assuming similar new loans are made under the same conditions.

Since limits for repayments of loans on insurance policies are not set because the various characteristics of the loans vary such as limits on the loan by repayments at cancellation, the book value is used for the market value, assuming market value is the same as book value given the expected maturity of the loan and interest rate conditions.

In addition, on loans to bankrupt, near-bankrupt, or potentially bankrupt borrowers, we first determine present value of estimated future cash flow, value of collateral and projected amounts collectable from guarantors to get an estimated amount from the bankruptcy, then subtract the present value of the loan loss from the consolidated balance sheet on that date of settlement to get an amount that is essentially the same as the market value.

Liabilities

Corporate bonds

Market value is based on reference prices for over-the-counter bond transactions disclosed by the Japan Securities Dealers Association.

Derivative transactions

In the case of derivative transactions, market value is based on forward exchange rates, final prices from the major stock exchanges, prices indicated by the transacting financial institutions, and prices calculated based on option price calculation models, etc.

(Note) 2. Financial instruments for which the market value is difficult to determine are outlined below, and these are not included in “(vi) Marketable securities.”

The market value has not been provided for ¥93,839 million in unlisted equities, ¥39,076 million in investment in capital of partnership where partnership assets are composed of unlisted equities, etc., and ¥1,616 million in corporate bonds because factors to reasonably calculate the value are insufficient due to bankruptcy or future cash flows are unknown.

11. Matters related to leased and other real estate are shown below.

(1) Matters related to status of leased and other real estate

Mitsui Sumitomo Insurance Co., Ltd. and some consolidated subsidiaries own leased office buildings, etc. in metropolitan Tokyo and other regions.

(2) Matters related to market value of leased and other real estate

Amount recorded in consolidated balance				Market value at end of current consolidated
sheets (Millions of yen)				fiscal year (Millions of yen)
43,600				106,255

(Notes) 1.		The amount recorded on the consolidated balance sheets is the amount after deducting accumulated depreciation from the acquisition cost.
2.		The market value at the end of the current consolidated fiscal year is the amount based on real estate appraisal documents according to major external real estate appraisers.

12. Book-value per share is ¥3,143.32 per share. The amount deductible from total net assets, which forms the basis for the calculation, is a minority interest of ¥6,750 million. The number of shares of common stock as of March 31, 2010 is 414,953 thousand shares.

13. Subsequent events that occurred after the end of the consolidated fiscal year under review and have material impact on the assets and performance during the subsequent consolidated fiscal years are as follows.

(Business Integration)

The Company entered into share exchange agreements, on September 30, 2009, with Aioi and NDGI pursuant to which the Company would become a wholly owning parent company, and consummated the share exchanges, on April 1, 2010, with each of Aioi and NDGI pursuant to the agreements, which had been approved at the extraordinary shareholders meeting held on December 22, 2009. Also on April 1, 2010, the Company changed its corporate name to MS&AD Insurance Group Holdings, Inc.

(1) Name and business of acquired businesses, major reason for business combination, date of business combination, name of business after combination, ratio of voting rights acquired, and the main reason for determining acquiring business

(i) Name and business of acquired business

Name of the acquired businesses: Aioi and NDGI

(ii) Major reason for business combination

To achieve sustainable growth and to enhance enterprise value through the creation of a globally operating and world-leading insurance and financial services group by rapidly and significantly improving the quality and expanding the quantity of operational bases and corporate resources.

(iii) Date of business combination

April 1, 2010

(iv) Legal structure of business combination

Share exchanges in which the Company has become a wholly owning parent company

(v) Name of business after combination

MS&AD Insurance Group Holdings, Inc.

(vi) Ratio of voting rights acquired

100%

(vii) Main reason to decide the acquiring company

It is determined that the Company is the acquiring company since it is the Company that issued shares and also since shareholders of the Company own the largest percentage of voting rights of the Company after the combination

(2) Acquisition cost of business acquired and its breakdown

	(Millions of yen)
	Aioi		NDGI
Consideration for acquisition		361,948		188,116
Direct expenditure for acquisition		171		88
Acquired cost		362,119		188,205

(3) Exchange ratio of shares by class, method of evaluation and number of shares delivered

(i) Exchange ratio of shares by class

0.190 ordinary share of the Company was allotted for 1 ordinary share of Aioi and 0.191 ordinary share of the Company was allotted for 1 ordinary share of NDGI

(ii) Method of evaluation

In order to support their respective efforts to ensure the fairness and appropriateness of the share exchange ratio, Aioi requested Nomura Securities and Morgan Stanley, NDGI requested Goldman Sachs, and the Company requested Nikko Citigroup (currently, Citigroup Global Markets Japan Inc.) to perform financial analyses relating to the applicable share exchange ratio under the Business Integration.

Aioi, NDGI, and the Company together on several occasions conducted careful negotiations and discussions on the share exchange ratios, comprehensively taking into account such factors as the financial position, assets, and future prospects of each party, making reference to the financial analyses prepared with respect to the share exchange ratios. As a result of the negotiations and discussions, the parties reached the conclusion that the share exchange ratio set out above is appropriate and agreed to determine the share exchange ratio shown above.

(iii) Number of shares delivered

		Aioi		NDGI
Shares delivered		139,479,256 shares		72,491,759 shares

The Company expects to recognize goodwill and negative goodwill on the consolidated financial statements in connection with the share exchanges, but their amounts are yet to be determined.

14. Any amount less than the stated unit is rounded down.

(Consolidated Statement of Income)

1. A breakdown of major business expenses is as follows:

Agency commissions		¥252,437 million
Salaries		¥141,502 million

Business expenses are the aggregate amount of loss adjustment expenses, operating expenses and general and administrative expenses, and commission and brokerage expenses in the accompanying consolidated statement of income.

2. Impairment losses on the following assets for the fiscal year under review are as stated below:

(Millions of yen)

Impairment

Holding purpose

Types

Properties

loss

Item

Real property for rent

Land & buildings

Total of 2 properties including building for rent owned by the Company in Aichi Prefecture

1,358

Land Buildings

526 831

Idle real property and real property for sale

Land & buildings

Total of 3 properties including house buildings for employees owned by the Company in Chiba Prefecture

2,073

Land Buildings

1,882 190

The real property for insurance businesses is classified as one asset group in the entire insurance business while the real property for rent, idle real property, and real property as groups individually by property.

Due to the decline in prices of real property and that some of the real properties are to be sold, the Company reduced the carrying value of these assets to a collectible amount and the decreased amount is stated as an impairment loss of ¥3,431 million in extraordinary loss.

The Company establishes the collectible amount of the real property valued at either net selling value or use value, whichever is the higher. Net selling value is calculated based on an expected selling value or inheritance tax valuation using road rating, and the use value is calculated by the future cash flows after discounting 5.5%.

3. Net income per share for the fiscal year under review is ¥89.84. Net income for the fiscal year under review, which forms the basis for the calculation, is ¥37,640 million and all amounts represent net income associated with common stock. The average number of shares issued and outstanding during the fiscal year under review is 418,960 thousand shares.

Net income per share after adjustment for residual securities is not stated because there are no residual securities.

4. Any amount less than the stated unit is omitted.

(Consolidated Statement of Shareholders Equity and Statement of Changes in Net Assets)

1. Matters concerning class and total number of shares issued and class and total number of shares of treasury stock

Number of

shares increased

shares decreased

Number of

during the fiscal

Number of

shares as of

year under

shares as of

March 31, 2009

review

March 31, 2010

(1000 shares)

Shares issued

Shares of common stock

421,320

—

421,320

Total

421,320

—

421,320

Treasury stock

Shares of common stock

2,020

4,348

6,367

Total

2,020

4,348

6,367

(Notes) 1.		The increase of 4,348 thousand shares of treasury stock of common stock is owing to an increase of 4,329 thousand shares resulting from purchases of shares in the market and an increase of 19 thousand shares resulting from purchase of sub-lot shares by the Company.
2.		The decrease of 2 thousand shares of common stock is due to the sale of sub-lot shares.

2. Matters concerning Cash Dividends

(1) Dividends paid

Total amount of

Dividend

Class of

dividends

per share

Record

Effective

Resolutions

(Millions of yen)

(in Yen)

date

Annual Shareholders Meeting held on June 25, 2009

Shares of common stock

11,321

Mar. 31, 2009

June 26, 2009

Meeting of the Board of Directors held on November 19, 2009

Shares of common stock

11,320

Sept. 30, 2009

Dec. 10, 2009

(2) Of the dividends whose record date was in the accounting year under review, those dividends whose effective date will be in the following accounting year

Total amount of

Dividend

Resolution

Class of

dividends

Dividend

per share

Record

Effective

(scheduled)

(Millions of yen)

assets

(in Yen)

date

Annual Shareholders Meeting to be held on June 29, 2010

Shares of common stock

11,203

Retained earnings

Mar. 31, 2010

June 30, 2010

3. Any amount less than the stated unit is omitted.

NON-CONSOLIDATED BALANCE SHEET (As of March 31, 2010)

(Millions of yen)

Item	Amount
(Assets)
Current Assets		8,075
Cash deposits and savings		153
Accounts receivable		7,500
Deposits from affiliates		87
Other		334
Fixed Assets		761,887
Tangible fixed assets		169
Buildings		134
Tools, furniture and fixtures		35
Investments and other assets		761,717
Stock of affiliates		761,714
Others		2
Total Assets		769,963

Item	Amount
(Liabilities)
Current Liabilities		547
Accounts payable		371
Corporate tax accrued		7
Deposits		10
Accrued bonuses for employees		157
Total Liabilities		547
(Net Assets)
Shareholders’ equity		769,415
Common stock		100,000
Capital surplus		646,401
Additional paid-in capital		179,191
Other capital surplus		467,210
Retained earnings		37,702
Other retained earnings		37,702
Retained earnings carried forward		37,702
Treasury stock		-14,687
Total Net Assets		769,415
Total Liabilities and Net Assets		769,963

NON-CONSOLIDATED STATEMENT OF INCOME (From: April 1, 2009) (To: March 31, 2010)

(Millions of yen)

Items	Amount
Operating Income
Dividends paid by affiliates		37,375
Commissions earned from affiliates		2,643	40,018
Operating Expenses
Sales and general administrative expenses		2,617	2,617
Operating income			37,401
Non-operating Income
Interest earned		4
Interest on refund		81
Other		1	87
Non-operating Expenses
Interest paid		64
Business integration expenses		389
Other		6	461
Ordinary profit			37,027
Current net income before taxes			37,027
Corporate, residential, and business taxes		3
Reversal of income taxes for prior periods		-2	1
Net income			37,026

NON-CONSOLIDATED STATEMENT OF CHANGES IN NET ASSETS (From: April 1, 2009) (To: March 31, 2010)

(Millions of yen)

Items	Amount
Shareholders’ Equity
Common stock
Balance as of March 31, 2009		100,000
Balance as of March 31, 2010		100,000
Capital surplus
Legal capital surplus
Balance as of March 31, 2009		179,191
Balance as of March 31, 2010		179,191
Other capital surplus
Balance as of March 31, 2009		467,210
Change this year
Disposal of treasury stock		0
Total change this year		0
Balance as of March 31, 2010		467,210
Retained Earnings
Other retained earnings
Retained earnings carried forward
Balance as of March 31, 2009		23,317
Change this year
Dividends of retained earnings		-22,641
Net income for this year		37,026
Total change this year		14,384
Balance as of March 31, 2010		37,702
Treasury Stock
Balance as of March 31, 2009		-4,644
Change this year
Acquisition of treasury stock		-10,048
Disposal of treasury stock		4
Total change this year		-10,043
Balance as of March 31, 2010		-14,687
Total Shareholders’ Equity
Balance as of March 31, 2009		765,074
Change this year
Dividends of retained earnings		-22,641
Net income		37,026
Acquisition of treasury stock		-10,048
Disposal of treasury stock		5
Total change this year		4,341
Balance as of March 31, 2010		769,415

NON-CONSOLIDATED EXPLANATORY NOTES

(Notes on Matters Concerning Important Accounting Policies)

1. Standard and method for valuation of securities

Valuation of stock of subsidiaries and affiliates is done at the cost method on a moving average cost basis.

2. Method for depreciation of tangible fixed assets

Depreciation of tangible fixed assets is computed using the declining-balance method, except for buildings (excluding fixtures) for which the straight-line method is applied.

Major useful lives for tangible fixed assets are as follows:

Buildings		8-38 years
Furniture and fixtures		5-20 years

3. Criteria for recording of allowances

The Company provides for an estimated amount payable at the end of the business year for accrued bonuses for employees and executives.

4. Consumption tax accounting

Consumption tax is accounted for under the tax exclusive (zei nuki) method.

(Notes on the Balance Sheet)

1. Accumulated depreciation of tangible fixed assets 3 million yen

2. Guarantee obligations

The Company has entered into agreements to maintain net assets with Mitsui Sumitomo MetLife Insurance Co., Ltd., an affiliate of the Company, in order to provide funds should the net assets of such company fall below a particular level, or should current assets be insufficient for the payment of loans. Mitsui Sumitomo Insurance Co., Ltd. also carries contractual obligations jointly with the Company. Their total liabilities as of March 31, 2010 stood at 3,081,115 million yen (including underwriting funds of 3,068,340 million yen), with total assets of 3,116,508 million yen.

Note that this agreement is not intended to guarantee payment of the liabilities of Mitsui Sumitomo MetLife Insurance Co., Ltd. As of March 31, 2010, net assets of Mitsui Sumitomo MetLife Insurance Co., Ltd. were higher than the specified standard, and there was no insufficiency in current assets.

3. Amounts receivable from and payable to affiliates

Short-term loans receivable		¥89 million yen
Short-term loans payable		¥34 million yen
(Notes on the P/L Statement)
Volume of transactions with affiliates
Volume of operating transactions
Operating income		¥40,018 million yen
Operating expenses		¥130 million yen
Volume of non-operating transactions		¥68 million yen

(Notes on the Statement of Shareholders’ Equity and Statement of Changes in Net Assets)

Type of treasury shares and total number thereof as of March 31, 2010

Common Stock 6,367,110 shares

(Notes on Tax Effect Accounting)

The primary cause of deferred tax assets is the amount of losses carried forward for tax purposes. Note that because an amount equivalent to the amount of the deferred tax assets is deducted as a valuation allowance, the deferred tax assets are not included in the balance sheet.

(Notes on Transactions with Related Parties)

Items regarding transactions with related parties are as noted below.

Percentage of

Balance as

Name of

voting rights owned

Relationship with

Transaction

of March 31,

Attribute

companies

by the Company

the party

details

amount

Item

2010

(Million yen)

Subsidiary

Mitsui SumitomoInsurance Co., Ltd.

Direct: 100%

Important subsidiary involved in the non-life insurance business.

Repayment (Note)

15,012

—

Interest payments (Note)

—

Transaction terms and how transaction terms are determined:

(Note) Interest rate on borrowing of funds is determined based on consideration of the market rate, and borrowing is on an unsecured, lump-sum repayment basis.

(Notes on Per Share Information)

Net assets per share		¥1,854.22
Net income per share		¥ 88.37

(Other) (Business Integration)

The Company entered into share exchange agreement with Aioi and NDGI as of September 30, 2009, and according to the agreement admitted at the extraordinary shareholders meeting held on December 22, 2009, executed the share exchanges between Aioi and NDGI, changing its corporate name to MS&AD Insurance Group Holdings, Inc. Related matters are noted in “Consolidated Explanatory Notes, Consolidated Balance Sheets, 13. (Business Integration)”.

Accounting Auditor’s Report on the Consolidated Financial Reports

Audit Report of the Independent Auditors

May 18, 2010 The Board of Directors MS&AD Insurance Group Holdings, Inc.

KPMG AZSA & Co.

Kimitaka Mori (Seal) Designated and Engagement Partner Certified Public Accountant

Ikuo Hirakuri (Seal) Designated and Engagement Partner Certified Public Accountant

Yoshiki Hisano (Seal) Designated and Engagement Partner Certified Public Accountant

We, the auditors, under the provisions of Article 444, Paragraph 4, of the Companies Act, have audited of the consolidated financial statements for MS&AD Insurance Group Holdings Inc., namely, the consolidated balance sheet, consolidated statement of income, consolidated statement of changes in net assets and consolidated explanatory notes for the consolidated fiscal year from April 1, 2009 through March 31, 2010. The preparation of these consolidated financial statements is the responsibility of the Company’s management. Our responsibility is to independently express an opinion on these consolidated financial statements based on our audits.

We, the auditors, have conducted the audit in accordance with auditing standards that are generally accepted in Japan. Those standards require that we plan and perform the audit to obtain reasonable assurances as to whether the consolidated financial statements are free of material misrepresentation. An audit includes, on a test basis, evidence supporting the amounts and disclosures in financial statements. An audit also includes an assessment of the accounting principles used, method of their application and significant estimates made by Management, as well as an evaluation of the overall presentation of consolidated financial statements. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position and operating results of MS&AD Insurance Group Holdings and the consolidated subsidiary companies composing the group for the year ended in the consolidated financial statements, in conformity with accounting principles that are generally accepted in Japan.

There exists no interest between the Company and our firm or engagement partners that must be cited according to the regulations of the Certified Public Accountants Act.

Accounting Auditor’s Report

Audit Report of the Independent Auditors

May 18, 2010 The Board of Directors MS&AD Insurance Group Holdings, Inc.

KPMG AZSA & Co.

Kimitaka Mori (Seal) Designated and Engagement Partner Certified Public Accountant

Ikuo Hirakuri (Seal) Designated and Engagement Partner Certified Public Accountant

Yoshiki Hisano (Seal) Designated and Engagement Partner Certified Public Accountant

We, the auditors, under the provisions of Article 436, Paragraph 2(1) of the Companies Act, have audited the financial statements for MS&AD Insurance Group Holdings Inc., namely the non-consolidated balance sheet, non-consolidated statement of income, non-consolidated statement of changes in net assets and non-consolidated explanatory notes, and the supplementary schedules for the second fiscal year of operations from April 1, 2009 until March 31, 2010. The preparation of these financial statements and the supplementary schedules is the responsibility of the Company’s management. Our responsibility is to independently express an opinion on these financial statements based on our audit.

We, the auditors, have conducted the audit in accordance with auditing standards that are generally accepted in Japan. Those standards require that we plan and perform the audit to obtain reasonable assurances as to whether the financial reports and the attached particulars are free of material misrepresentation. An audit includes, on a test basis, evidence supporting the amounts and disclosures in financial reports and the attached particulars. An audit also includes an assessment of the accounting principles used, method of their application and significant estimates made by Management, as well as an evaluation of the overall presentation of financial statements and the supplementary schedules. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and the supplementary schedules referred to above represent fairly, in all material respects, the financial position and operating results of Mitsui Sumitomo Insurance Group Holdings Inc. for the year ended in the financial statements and the supplementary schedules, in conformity with accounting principles that are generally accepted in Japan.

There exists no interest between the Company and the auditor or managing partners that must be cited according to the regulations of the Certified Public Accountants Act.

Audit Report of the Board of Corporate Auditors

Corporate Auditors Report

With respect to the Directors’ performance of duties during the second fiscal year of operations beginning April 1, 2009 and ending March 31, 2010, this Board of Corporate Auditors has prepared this audit report after deliberations based upon the audit reports prepared by each Corporate Auditor and reports as follows:

1. Corporate Auditors and Method and Content of Audit by Board of Corporate Auditors

The Board of Corporate Auditors formulates audit policies, audit plans, and other relevant matters regarding auditing. The Board of Corporate Auditors also receives reports from each Corporate Auditor regarding the status of implementation and the results thereof. The Board of Corporate Auditors has received reports from the Representative Directors and the accounting auditor regarding the status of the performance of their respective duties, and has requested further explanation as necessary.

In conformity with Corporate Auditors auditing standards as set forth by the Board of Corporate Auditors, and in accordance with the audit policies and audit plans, each Corporate Auditor has endeavored to facilitate communication and mutual understanding among the Directors, Executive Officers, the internal audit division, and other company employees, and has endeavored to collect information and to maintain and improve the audit environment. Corporate Auditors have attended meetings of the Board of Directors and other important meetings, received reports on the status of performance of duties from the Directors, Executive Officers and other employees, requesting explanation as necessary. They have examined important documents involving resolutions of the company and inspected the operations and financial affairs of the company. Also, each Corporate Auditor supervised the resolutions of the Board of Directors to establish the systems provided by Article 100, Sections 1 and 3 of the Ordinance for Enforcement of Corporate Law and the systems established pursuant to such resolutions (internal control system), which are necessary to establish the systems to ensure directors and employees carry out their duties in accordance with law and the Company’s Articles of Incorporation and other systems to ensure appropriate business. Corporate Auditors have received reports from Directors and/or the Accounting Auditor, AZSA, regarding said internal controls systems and the conditions audited, and required additional explanation as necessary. With respect to subsidiaries, each Corporate Auditor endeavored to facilitate mutual understanding and communication with directors and corporate auditors at subsidiary companies, and received reports regarding the operations at subsidiary companies as necessary. Through the foregoing methods, we have verified the business reports and other supplementary schedules for the fiscal year of operations under consideration.

In addition to monitoring and verifying that Accounting Auditors maintain their position of independence and that audits are being conducted in an appropriate manner, Corporate Auditors received reports from accounting auditors on the status of the performance of their duties and required further explanation as necessary. Each Corporate Auditor was notified by the accounting auditor that it had established “a system to ensure that duties of accounting auditor are being conducted properly” (matters prescribed in each item of Article 131 of the Corporate Accounting Regulations) and that the system is developed and implemented in accordance with the “Quality Control Standards for Audits” (Business Accounting Council, October 28, 2005) and other applicable standards, and required further explanation as necessary. On the basis of the foregoing methods, we have verified financial statements and the supplementary schedules as well as the consolidated financial statements for the fiscal year under review.

Full-time Corporate Auditor, Masahiko Oji, Corporate Auditor Kuniaki Nomura and Hiroyuki Tezuka took office as of April 1, 2010. Audit of the matters occurred before their assumption is done by measures such as receiving reports from other auditors and examining documents.

2. Audit Outcomes

(1) Findings of the Audit of Business Reports

i. We acknowledge that business reports and the supplementary schedules fairly represent the status of the Company in accordance with applicable laws and regulations and the articles of incorporation of the Company.

ii. We acknowledge that no misconduct or material fact constituting a violation of any laws or regulations or the articles of incorporation of the Company was found with respect to the performance of duties by Directors.

iii. We acknowledge that resolutions adopted by the Board of Directors (including financial statements in the internal control system) are appropriate with respect to the internal controls system. We found no matters to be mentioned with respect to the Directors’ performance of their duties concerning the internal control systems.

(2) Findings of the Audit of Financial Statements and the Supplementary Schedules

We acknowledge that the auditing methods used by Accounting Auditors, AZSA, and the results obtained thereby are appropriate.

(3) Findings of the Audit of Consolidated Financial Statements

We confirm that the auditing methods used by Accounting Auditors, AZSA, and the results obtained thereby are appropriate.

May 19, 2010

Board of Corporate Auditors, MS&AD Insurance Group Holdings, Inc.

Takashi Yamashita, Full-time Corporate Auditor ______ Seal Masahiko Oji, Full-time Corporate Auditor ______ Seal Sosuke Yasuda, Corporate Auditor ______ Seal Kuniaki Nomura, Corporate Auditor ______ Seal Hiroyuki Tezuka, Corporate Auditor ______ Seal

Note: Corporate Auditors Sosuke Yasuda, Kuniaki Nomura and Hiroyuki Tezuka are designated outside auditors according to Article 2, No. 16 and Article 335, Item 3 of the Companies Act.

Reference Document for Annual Shareholders Meeting

Items of Business and Reference Matters:

First Item: Appropriation of Retained Earnings

The Company aims to pursue further efficiency by realizing synergies and implement growth strategies, hence enhance its profitability, and in turn to make appropriate returns to shareholders that are proportionate to its performance. Meanwhile, due to the nature of the insurance business, the Company believes it is also necessary to strive to maintain adequate internal reserves.

Based on the above, it is the Company’s basic policy to at least secure a stable trend of dividend per share, pursue enhanced profitability and hence a trend of increase in dividends, and in the medium terms return to shareholders, through dividends and share repurchases, 50% of its group core profit.

In accordance with the policies above, the Company proposes that the appropriation of retained earnings for the fiscal year under review be as follows:

Matters concerning the year-end cash dividend:

	1.		Matters regarding distribution of dividends to shareholders and the total amount thereof:
			¥27 per share of common stock of the Company Total ¥11,203,747,983
			As a result, the year-end cash dividend for the fiscal year under review totals 54 yen per share, including the interim dividend.
	2.		Effective date of dividend:
			June 30, 2010

	(Note) 1.		The year-end cash dividend is distributed to the shareholders who were recorded on the shareholders registry as of the record date of March 31, 2010.
	2.		The group core profit is the Company’s own index showing the ordinary profitability of the entire group. It is calculated by adding to/deducting from the consolidated net income gains and losses that are not ordinary in nature, such as gains or losses on sale of equity securities the Company had intended to hold for a long term.

Second Item: Election of Thirteen (13) Directors

The terms of office of all Directors (13) will expire at the close of this Annual Shareholder Meeting.

It is, therefore, proposed that thirteen (13) Directors including four (4) Outside Directors be elected.

The candidates for Directors are as follows:

Candidate	Name	Résumé, significant concurrent positions, if any,		Number of shares of
No.	(Date of birth)	and position and duties at the Company		the Company owned
1	Toshiaki Egashira	April 1972	Entered Taisho Marine and Fire Insurance Co., Ltd. (currently, Mitsui Sumitomo Insurance Co., Ltd.)	12,400 shares
	(Nov. 30, 1948)	April 1995	General Manager of Guarantee and Credit Dept. of Non-Marine Underwriting Dept.
		June 1997	General Manager of Corporate Planning Dept.
		April 1999	General Manager of Non-Marine Underwriting Dept. of Underwriting Div.
		May 2000	General Manager, Corporate Planning Dept. (seconded to The General Insurance Association of Japan )
		April 2001	General Manager of Non-Marine Underwriting Dept. of Underwriting Div.
		Oct. 2001	Executive Officer, General Manager of Fire & Casualty Underwriting Dept.
		June 2002	Executive Officer, General Manager of Chugoku Div.
		June 2003	Managing Executive Officer, General Manager of Chugoku Div.
		April 2004	Managing Executive Officer, General Manager of Kanagawa & Shizuoka Div.
		Oct. 2005	Managing Executive Officer, General Manager of Kanagawa & Shizuoka Div. And General Manager for Claim Handling Service Reform, Kanagawa & Shizuoka Div.
		April 2006	Chief Executive Officer
		June 2006	President & Director, Co-Chief Executive Officer
		Sept. 2006	President, Director & CEO
		April 2008	President & Director, the Company
		April 2009	President, Director & CEO (present)
		April 2010	Chairman & Director, Chairman Executive Officer, Mitsui Sumitomo Insurance Co., Ltd. (present)
		<Position and duties at the Company>
		Representative Director, President & CEO
		<Significant Concurrent Positions>
		Chairman & Director, Mitsui Sumitomo Insurance Co., Ltd.
2	Ichiro Tateyama	April 1967	Entered The Dowa Fire and Marine Insurance Co., Ltd. (currently, Nissay Dowa General Insurance Co., Ltd.)	16,127 shares
	(June 8, 1943)	June 1991	General Manager of Property & Casualty Dept.
		April 1994	General Manager of Property & Casualty Underwriting Dept.
		June 1995	Director, General Manager of Investment Dept.
		June 1997	Managing Director
		Sept. 1997	Managing Director, Deputy General Manager of Task Force for Expense Reduction
		June 1999	Managing Director, General Manager of Task Force for Expense Reduction
		April 2000	Managing Director, General Manager of Task Force for Structural Reformation
		April 2001	Senior Managing Director, General Manager of Task Force for Structural Reformation
		April 2002	Senior Managing Director
		June 2005	Director & Executive Vice President
		April 2006	President & Director (present)
		April 2010	Director & Executive Officer, the Company (present)
		<Position and duties at the Company>
		Representative Director, Executive Officer Assist CEO
		<Significant Concurrent Positions>
		President & Director, Nissay Dowa General Insurance Co., Ltd.

Candidate	Name	Résumé, significant concurrent positions, if any,		Number of shares of
No.	(Date of birth)	and position and duties at the Company		the Company owned
3	Tadashi Kodama	April 1970	Entered Dai-Tokyo Fire & Marine Insurance Co., Ltd. (currently, Aioi Insurance Co., Ltd.)	17,480 shares
	(Nov. 11, 1947)	July 1989	General Manager of Tokyo 4th Block and General Manager of Tokyo 5th Block
		April 1990	General Manager of Tokyo Sales Dept. 3rd
		July 1992	General Manager of Tokyo Sales Promotion Dept.
		April 1994	General Manager of Corporate Sales Dept. 4th
		April 1996	General Manager of Sales Promotion Dept.
		April 1998	General Manager of Corporate Planning Dept.
		July 1998	Associate Director, Executive General Manager of Ibaragi Region & General Manager of Ibaragi Sales Dept. 1st
		April 2000	Executive Officer, General Manager of Sales Promotion Dept.
		April 2001	Executive Officer
		June 2001	Director, Executive General Manager of Operating and System Unit
		April 2002	Managing Director, Executive General Manager of Operating and System Unit
		April 2003	Senior Managing Director, Deputy Executive General Manager of Sales Promotion Unit
		May 2003	Senior Managing Director, Executive General Manager of Operating and System Unit & Deputy Executive General Manager of Sales Promotion Unit
		April 2004	President & Director (present)
		April 2010	Director & Vice Chairman, Aioi Insurance Co., Ltd. Director & Executive Officer, the Company (present)
		<Position and Duties at the Company>
		Representative Director, Executive Officer Assist CEO
		<Significant Concurrent Positions>
		Director & Vice Chairman, Aioi Insurance Co., Ltd.
4	Yasuyoshi Karasawa	April 1975	Entered The Sumitomo Marine and Fire Insurance Co., Ltd.	8,200 shares
		June 1998	General Manager of Corporate Communications Dept.
	(Oct. 27, 1950)	Feb. 2000	General Manager of Secretariat & Corporate Planning Dept., and General Manager of Business Rationalization Dept.
		April 2000	General Manager of Secretariat & Corporate Planning Dept.
		Oct. 2001	General Manager, Corporate Planning Dept., Mitsui Sumitomo Insurance Co., Ltd.
		July 2002	General Manager of Investment Planning Dept. of Financial Service Div.
		April 2004	Executive Officer, General Manager of Corporate Planning Dept.
		June 2005	Director, Executive Officer, General Manager of Corporate Planning Dept.
		April 2006	Director, Managing Executive Officer
		April 2008	Director, Senior Executive Officer Director, the Company
		April 2009	Director, Senior Executive Officer
		April 2010	President, Director & CEO, Mitsui Sumitomo Insurance Co., Ltd. (present) Director & Executive Officer, the Company (present)
		<Position and Duties at the Company>
		Representative Director, Executive Officer Assist CEO
		<Significant Concurrent Positions>
		President, Director & CEO, Mitsui Sumitomo Insurance Co., Ltd.

Candidate	Name	Résumé, significant concurrent positions, if any,		Number of shares of
No.	(Date of birth)	and position and duties at the Company		the Company owned
5	Susumu Fujimoto	April 1972	Entered the Ministry of Finance (the “MOF”)	8,600 shares
		June 1998	Director-General of Yokohama Customs, MOF
	(Dec. 5, 1948)	July 1999	Deputy Director-General, Yokohama Customs, MOF
		July 2002	Executive Director, European Bank for Reconstruction and Development
		Aug. 2005	Advisor, Mitsui Sumitomo Insurance Co., Ltd.
		June 2007	Director
		April 2008	Director, Managing Executive Officer Director, the Company
		April 2009	Director, Senior Executive Officer, Mitsui Sumitomo Insurance Co., Ltd. Director, Senior Executive Officer, the Company (present)
		<Position and duties at the Company>
		Director, Senior Executive Officer
		Compliance Dept., Corporate Risk Management Dept., Internal Audit Dept.
		Mitsui Sumitomo Kirameki Life Insurance Co., Limited., Mitsui Sumitomo MetLife Insurance Co., Ltd., Mitsui Direct General Insurance Co., Ltd.
6	Shuhei Horimoto	April 1977	Entered The Sumitomo Marine and Fire Insurance Co., Ltd.	4,754 shares
	(Aug. 19, 1954)	Sep. 2001	General Manager for Marketing Promotion, Hokkaido Regional Headquarters
		Oct. 2001	General Manager for Planning (Compliance Officer), Hokkaido Div., Mitsui Sumitomo Insurance Co., Ltd.
		April 2003	General Manager for Planning, Hokkaido Div.
		April 2004	General Manager of Kanazawa Branch, Hokuriku Div.
		Sep. 2006	Executive Officer, General Manager of Corporate Quality Control Dept.
		April 2008	Executive Officer, General Manager of Kyushu Div. and General Manager for Claim Handling Service Innovation, Kyushu Div.
		April 2009	Director, Managing Executive Officer Managing Executive Officer, the Company
		June 2009	Director, Managing Executive Officer (present)
		<Position and duties at the Company>
		Director, Managing Executive Officer
		Corporate Planning Dept., Corporate Communications and Invester Relations Dept., Business Development Dept., Internal Audit Dept.
7	Hisahito Suzuki	April 1973	Entered Dai-Tokyo Fire & Marine Insurance Co., Ltd. (currently, Aioi Insurance Co., Ltd.)	11,970 shares
	(Sep. 15, 1950)	April 1996	General Manager of Chiba Sales Dept. 3rd
		July 1998	General Manager of General Planning Dept.
		April 1999	Associate Director, General Manager of Corporate Planning Dept.
		March 2000	Associate Director, General Manager of Merger Preparation Dept. & General Manager of Corporate Planning Dept.
		April 2000	Executive Officer, General Manager of Merger Preparation Dept.
		April 2001	Executive Officer, General Manager of Corporate Planning Dept.
		April 2002	Managing Executive Officer
		June 2002	Managing Director
		May 2003	Senior Managing Executive Officer, Aioi Life Insurance Company, Limited
		June 2003	Director & Vice President
		March 2004	Senior Managing Executive Officer, Aioi Insurance Co., Ltd.
		June 2004	Senior Managing Director
		June 2008	Director, Senior Managing Executive Officer
		April 2010	Director & President, Aioi Insurance Co., Ltd. (present) Director, Executive Officer, the Company (present)
		<Position and duties at the Company>
		Director, Executive Officer
		Corporate Management Aide
		<Significant Concurrent Positions>
		Director & President, Aioi Insurance Co., Ltd.

Candidate	Name	Résumé, significant concurrent positions, if any,		Number of shares of
No.	(Date of birth)	and position and duties at the Company		the Company owned
8	Masanori Yoneda	April 1974	Entered The Dowa Fire and Marine Insurance Co., Ltd. (currently, Nissay Dowa General Insurance Co., Ltd.)	8,746 shares
	(July 24, 1950)	April 1999	General Manager of Task Force for Expense Reduction
		April 2000	General Manager of Tokyo Commercial Line Production Dept. 1
		April 2001	General Manager of Tokyo Commercial Line Production Dept. 3
		June 2003	Director, General Manager of Tokyo Commercial Line Production Dept. 3
		April 2004	Director, General Manager of Business Promotion Dept.
		April 2006	Director, Managing Executive Officer
		April 2009	Director, Senior Managing Executive Officer
		April 2010	Director & Vice President Executive Officer, Nissay Dowa General Insurance Co., Ltd. (present) Director, Executive Officer, the Company (present)
		<Position and duties at the Company>
		Director, Executive Officer
		Corporate Management Aide
		<Significant Concurrent Positions>
		Director & Vice President Executive Officer, Aioi Insurance Co., Ltd.
9	Katsuaki Ikeda	April 1974	Entered Taisho Marine and Fire Insurance Co., Ltd. (Currently, Mitsui Sumitomo Insurance Co., Ltd.)	11,200 shares
	(Sep. 8, 1951)	April 1998	General Manager of Financial Services Dept. of Investment Div.
		June 1999	General Manager of Accounting Dept.
		June 2003	Director, Executive Officer, General Manager of Accounting Dept.
		April 2005	Director, Managing Executive Officer
		April 2006	Director, Managing Executive Officer, General Manager of Financial Service Div.
		April 2008	Director, the Company
		April 2009	Director, Managing Executive Officer
		April 2010	Director, Senior Executive Officer, Mitsui Sumitomo Insurance Co., Ltd. (present) Director, Executive Officer, the Company (present)
		<Position and duties at the Company>
		Director, Executive Officer
		Corporate Management Aide
		<Significant Concurrent Positions>
		Director, Senior Executive Officer, Mitsui Sumitomo Insurance Co., Ltd.
10	Toshihiko Seki	April 1977	Associate Professor, School of Law, Tohoku University	1,900 shares
		April 1984	Professor, School of Law, Tohoku University
	(Feb. 28, 1941)	April 2000	Professor, Tohoku University Law School
		April 2004	Professor Emeritus, Tohoku University (present) Professor, Hosei University Law School (present)
		May 2004	Registered as Attorney-at-Law
		June 2007	Director, Mitsui Sumitomo Insurance Co., Ltd.
		April 2008	Director, the Company (present)
		<Position and duties at the Company>
		Director
		<Significant Concurrent Positions>
		Professor Emeritus, Tohoku University
		Professor, Hosei University, Graduate School of Law

Candidate	Name	Résumé, significant concurrent positions, if any,		Number of shares of
No.	(Date of birth)	and position and duties at the Company		the Company owned
11	Akira Watanabe (Feb. 16, 1947)	April 1973	Registered as Attorney-at-Law Attorney-at-Law, Ginza Law Office (currently, Abe, Ikubo & Katayama)	0 shares
		April 1982	Attorney-at-Law, Akira Watanabe Law Office
		April 1989	Attorney-at-Law, Seiwa Kyodo Law Office (currently, Seiwa Meitetsu Law Office) (present)
		April 2010	Director, the Company (present)
		<Position and duties at the Company>
		Director
		<Significant Concurrent Positions>
		Attorney-at-Law, Seiwa Meitetsu Law Office
		Outside Director, Japan Pile Corporation
		Outside Director, Maeda Corporation
		Outside Corporate Auditor, Fast Retailing Co., Ltd.
		Outside Corporate Auditor, Kadokawa Group Holdings, Inc.
12	Mitsuhiro Umezu	April 1992	Lecturer, Keio University (International Center)	0 shares
	(May 18, 1957)	April 2005	Associate Professor, Faculty of Business and Commerce, Keio University
		April 2007	Associate Professor, Faculty of Business and Commerce, Keio University
		June 2007	Director, Nissay Dowa General Insurance Co., Ltd.
		Oct. 2009	Associate Professor, Faculty of Business and Commerce, Keio University and Deputy Director, International Center, Keio University (present)
		April 2010	Director, the Company (present)
		<Position and duties at the Company>
		Director
		<Significant Concurrent Positions>
		Associate Professor, Faculty of Business and Commerce, Keio University and Deputy Director, International Center, Keio University
13	Daiken Tsunoda (Jan. 29, 1967)	April 1994	Registered as Attorney-at-Law Attorney-at-Law, Mori Sogo (currently, Mori Hamada & Matsumoto)	0 shares
		Mar. 2003	Attorney-at-Law, Nakamura & Tsunoda (currently, Nakamura, Tsunoda & Matsumoto) (present)
		April 2008	Corporate Auditor, the Company
		April 2010	Director, the Company (present)
		<Position and duties at the Company>
		Director
		<Significant Concurrent Positions>
		Attorney-at-Law, Nakamura, Tsunoda & Matsumoto
		Outside Corporate Auditor, Atlus Co., Ltd.
		Outside Corporate Auditor, INES Corp.

(Notes)	1.		Messrs. Toshihiko Seki, Mitsuhiro Umezu, and Daiken Tsunoda are each a candidate for Outside Director.
	2.		Matters of particular mention with respect to the candidates for Outside Directors are as follows:

(1) The grounds for election of the candidates for Outside Directors:

(i) Mr. Toshihiko Seki has held the positions of professor at Tohoku University’s School of Law, and Hosei University’s Graduate School of Law. The Company requests the shareholders to elect him as Outside Director of the Company to reflect his knowledge and experience as a legal scholar in the management of the Company.

(ii) Mr. Akira Watanabe is presently an attorney-at-law. Therefore, the Company requests the shareholders to elect him as Outside Director of the Company to reflect his knowledge and experience as a legal professional in the management of the Company. (iii) Mr. Mitsuhiro Umezu is presently Associate Professor at Keio University Faculty of Business and Commerce and has expertise on corporate ethics, etc. The Company requests the shareholders to elect him as Outside Director of the Company to reflect his knowledge and experience in the management of the Company. (iv) Mr. Daiken Tsunoda is presently an attorney-at-law. Therefore, the Company requests the shareholders to elect him as Outside Director of the Company to reflect his knowledge and experience as a legal professional in the management of the Company.

(2) The grounds on which the Company considers a candidate for outside Director will be able to appropriately perform the duties of Outside Director, notwithstanding the fact that such candidate has not been involved in management of a corporation in the past except as an Outside Director or Outside Corporate Auditor:

(i) The Company considers that Mr. Toshihiko Seki will be able to appropriately perform the duties of Outside Director, taking into account his professional knowledge and his experience as a legal scholar. (ii) The Company considers that Mr. Akira Watanabe will be able to appropriately perform the duties of Outside Director, taking into account his professional knowledge and experience as a legal professional. (iii) The Company considers that Mr. Mitsuhiro Umezu will be able to appropriately perform the duties of Outside Director, taking into account his professional knowledge and his experience with respect to corporate ethics, etc. (iv) The Company considers that Mr. Daiken Tsunoda will be able to appropriately perform the duties of Outside Director, taking into account his professional knowledge and experience as a legal professional.

(3) Time since a candidate first assumed the office of outside Director of the Company:

The time for which Mr. Toshihiko Seki has been outside Director will be two (2) year and three (3) months as upon the close of this Annual Shareholders Meeting. The time for which Messrs. Akira Watanabe, Mitsuhiro Umezu and Daiken Tsunoda have each been Outside Director will be three (3) months as upon the close of this Annual Shareholders Meeting. The Company has submitted Report on Independent Directors/Auditors, that Messrs. Toshihiko Seki, Akira Watanabe, Mitsuhiro Umezu and Daiken Tsunoda are independent directors, which Tokyo Stock Exchange, Osaka Stock Exchange and Nagoya Stock Exchange require listed companies to designate, who are unlikely to give rise to conflict of interest in relation to general shareholders.

(4) Agreement to limit outside Director’s liability:

The Company maintains an agreement with each of Messrs. Toshihiko Seki, Akira Watanabe, Mitsuhiro Umezu and Daiken Tsunoda that limits the Outside Director’s liability for any damage to the Company caused by a failure to perform the duties of an Outside Director if the Outside Director has performed the duties in good faith and without gross negligence, in order to allow them to exercise their capabilities as expected. The limit of Outside Director’s liability under each such agreement is the sum of the amount provided by the items in Article 425, Paragraph 1 of the Companies Act. The Company will continue with such agreement when the candidate is elected as Outside Director.

-End-

[Translation]

SUMMARY OF FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2010

May 20, 2010

Name of Listed Company:		MS & AD Insurance Group Holdings, Inc.
		(Formerly, Mitsui Sumitomo Insurance Group Holdings, Inc.)
Securities Code No.:		8725
Stock Exchanges:		Tokyo, Osaka, Nagoya
URL:		http://www.ms-ad-hd.com
Representative:		Toshiaki Egashira, President
Contact:		Keisuke Kawamoto, Manager, Consolidated Accounting Section, Accounting Department
		Telephone : (03)-6202-5273

Date of Ordinary General Meeting of Shareholders:		June 29, 2010
Date of filing of Financial Report:		June 29, 2010
Date of starting payment of year-end dividends:		June 30, 2010

(Note) Amounts are truncated.

1. Consolidated Business Results for the year ended March 31, 2010 (April 1, 2009 to March 31, 2010)

(1) Results of Consolidated Operations

(Yen in millions)

	Ordinary income				Ordinary profit					Net income
Year ended March 31, 2010		1,962,689	(3.8	)%		52,695		—	%		37,640	359.5	%
Year ended March 31, 2009		2,040,013	—	%		(13,044	)	—	%		8,192	—	%

Percent figures represent changes in comparison with the preceding fiscal year.

(Yen)

			Net income per					Ordinary profit to			Ordinary profit to
	Net income per share		share -Diluted		Return on equity			Total assets			Ordinary income
Year ended March 31, 2010		89.84		—		3.3	%		0.7	%		2.7	%
Year ended March 31, 2009		19.45		—		0.6	%		(0.2	)%		(0.6	)%

(Reference) Equity in net gains(losses) of affiliates: ¥ 4,878 million for the year ended March 31, 2010 ¥(4,243) million for the year ended March 31, 2009

(2) Consolidated Financial Conditions

(Yen in millions)

								Net assets
					Net assets less minority			less minority interests
	Total assets		Net assets		interests to Total assets			per share (Yen)
As of March 31, 2010		7,519,625		1,311,082		17.3	%		3,143.32
As of March 31, 2009		7,440,709		1,023,021		13.6	%		2,411.70

(Reference) Net assets less minority interests:		As of March 31, 2010:		¥1,304,332 million
		As of March 31, 2009:		¥1,011,226 million

(3) Consolidated Cash Flows

(Yen in millions)

	Cash flows from			Cash flows from		Cash flows from			Cash and cash equivalents
	operating activities			investing activities		financing activities			at end of fiscal year
Year ended March 31, 2010		(33,930	)		52,741		(104,320	)		377,158
Year ended March 31, 2009		38,612			94,495		4,184			455,430

2. Dividends

	Dividend per share (Yen)										Total annual		Dividend			Dividends on
	1st		2nd		3rd		4th				dividends		pay-out ratio			net assets
	Quarter		Quarter		Quarter		Quarter		Annual		(Yen in millions)		(Consolidated)			(Consolidated)
Year ended March 31, 2009		—		27.00		—		27.00		54.00		22,692		277.6	%		1.7	%
Year ended March 31, 2010		—		27.00		—		27.00		54.00		22,524		60.1	%		1.9	%
Year ending March 31, 2011 (Forecast)		—		27.00		—		27.00		54.00				66.4	%

3. Forecast for the current period (April 1, 2010 to March 31, 2011)-Consolidated

(Yen in millions)

	Ordinary income				Ordinary profit				Net income				Net income per share (Yen)
Six months ending September 30, 2010		1,660,000	63.4	%		56,000	(31.9	)%		32,000	(43.7	)%		51.04
Year ending March 31, 2011		3,330,000	69.7	%		86,000	63.2	%		51,000	35.5	%		81.34

Percent figures represent changes in comparison with the corresponding period of preceding fiscal year.

4. Other information

(1) Significant changes in scope of consolidation during the period : None

(2) Changes in accounting principle, procedure and presentation preparing the consolidated financial statements

1. Changes due to revision of accounting standard: Yes

2. Changes due to other than above: None

(3) The number of shares outstanding (Common stock)

1. The number of shares outstanding (including treasury stock)

As of March 31, 2010:		421,320,739 shares
As of March 31, 2009:		421,320,739 shares

2. The number of treasury stock

As of March 31, 2010:		6,367,110 shares
As of March 31, 2009:		2,020,643 shares

(Reference) Summary of Non-consolidated Financial Results

Non-consolidated Business Results for the year ended March 31, 2010 (April 1, 2009 to March 31, 2010)

(1) Results of Operations

(Yen in millions)

	Operating Income				Operating Profit				Ordinary Profit				Net Income
Year ended March 31, 2010		40,018	5.1	%		37,401	5.3	%		37,027	6.7	%		37,026	6.7	%
Year ended March 31, 2009		38,073	—	%		35,530	—	%		34,693	—	%		34,689	—	%

Percent figures represent changes in comparison with the preceding fiscal year.

(Yen)

			Net income per
	Net income per share		share -Diluted
Year ended March 31, 2010		88.37		—
Year ended March 31, 2009		82.38		—

(2) Financial Conditions

(Yen in millions)

								Net assets
	Total assets		Net assets		Net assets ratio			per share (Yen)
As of March 31, 2010		769,963		769,415		99.9	%		1,854.22
As of March 31, 2009		780,551		765,074		98.0	%		1,824.64

(Reference) Net assets:		As of March 31, 2010:		¥769,415 million
		As of March 31, 2009:		¥765,074 million

*Notification

(1)		The financial forecasts were based upon currently available information and contain many elements of uncertainty. Actual results may differ from the forecasts due to changes in the business environment.
(2)		The net income per share in the forecast for the current period is calculated based on the forecast average number of shares after considering the number of shares issued in the share exchange with Aioi Insurance Co., Ltd. and Nissay Dowa General Insurance Co., Ltd on April 1, 2010.
(3)		The Company changed its name from “Mitsui Sumitomo Insurance Group Holdings, Inc.” to “MS & AD Insurance Group Holdings, Inc.” on April 1, 2010.

1. Operating Results

(1) Analysis of Operating Results

(Operating Results for the Current Fiscal Year)

Insurance underwriting income was ¥1.8 trillion; income from asset management, ¥139.9 billion; and other ordinary income, ¥10.1 billion, for a total of ¥1.9 trillion in ordinary income. In terms of ordinary expenses, meanwhile, ¥1.5 trillion in insurance underwriting expenses, ¥47.0 billion in asset management expenses, ¥294.9 billion in SG&A expenses, and ¥6.8 billion in other ordinary expenses resulted in a total of ¥1.9 trillion.

This led to increase of ordinary profit by ¥65.7 billion from the previous fiscal year to ¥52.6 billion. After adjusting this for extraordinary income, extraordinary losses, and corporate and resident taxes and other factors, net income came to ¥37.6 billion, increase of ¥29.4 billion from the previous fiscal year. Results in each lines of business segment are as follows.

(i) In non-life insurance business, net premiums written fell by 51.4 billion yen to 1.3 trillion yen due to 31.0 billion yen decrease of net premiums written in Mitsui Sumitomo Insurance Co., Ltd. owing to decreased income from compulsory automobile liability insurance and marine liability insurance, and also decrease of net premiums written in consolidated overseas subsidiaries influenced by strong yen. After adding asset investment profit/loss to this, net income decreased by 90.2 billion yen to 1.8 trillion yen due to decreased gains on sale of securities.

(ii) In the life insurance business, life insurance premiums rose by 1.7 billion yen to 135.1 billion yen. Also, investment profit at its equity method affiliate Mitsui Sumitomo MetLife Insurance Co., Ltd. was 4.4 billion yen, and ordinary income, adding income from asset management etc. to these amounts, increased by 6.9 billion yen from the previous fiscal year to 160.4 billion yen. Ordinary profit increased by 8.9 billion yen form the previous fiscal year to 5.0 billion yen due to increase in investment profit under equity method.

A breakdown by location is shown below.

Ordinary income was 1.7 trillion yen in Japan, 73.0 billion yen in Asia, 105.9 billion yen in Europe, and 43.9 billion yen in the Americas. Ordinary profit was 39.1 billion yen in Japan, 8.1 billion yen in Asia, 1.9 billion yen in Europe, and 10.3 billion yen in the Americas. Japan contributed high shares of ordinary income (before eliminating internal transactions) at 89%.

(Outlook for the Following Fiscal Year)

As for the consolidated results for the in the following fiscal year, the Company forecasts ordinary income of 3.3 trillion yen, ordinary profit of 86.0 billion yen and net income of 51.0 billion yen under the following conditions:

• Net premiums written is estimated by the Company taking into account changes of operational results in the past.

• Net claims occurred (sum of net claims paid and provision for outstanding claims) concerning natural disasters expected in the Company’s subsidiaries are 15.0 billion yen in Mitsui Sumitomo Insurance Co., Ltd. and 13.0 billion yen in total in Aioi Insurance Co., Ltd. (“Aioi”) and Nissay Dowa General Insurance Co., Ltd. (“NDGI”), respectively.

• Business integration expenses mainly for merger of Aioi and NDGI is estimated to be approximately 35.0 billion yen.

• Approximately 14.0 billion yen of profit from negative goodwill concerning the business integration is expected.

• No major changes in market interest rates, exchange rates and status of security markets are expected.

• The actual operational results of the Company may differ significantly from the forecast since it is based on the above conditions and there are possibilities of major disasters beyond its expectations and other factors.

(2) Analysis of Financial Condition

Total assets at the end of the current fiscal year increased by 78.9 billion yen from the previous period to 7.5 trillion yen. Net assets increased by 288.0 billion yen from the previous period to 1.3 trillion yen, due to a increase in valuation differences of other marketable securities.

Cash flows from operating activities for the current fiscal year fell by 72.5 billion yen from the previous period to negative cash flow of 33.9 billion yen due to decrease of premiums and dividends paid. Cash flows from investing activities dropped by 41.7 billion yen from the previous period to a negative cash flow of 52.7 billion yen due to reduction of gains from sale and redemption of securities. Cash flows from financing activities decreased by 108.5 billion yen from the previous period to a negative cash flow of 104.3 billion yen due to redemption of corporate bonds. As a result of these cash flows, cash and cash equivalents at the end of the year amounted to 377.1 billion yen, a reduction of 78.2 billion yen from the previous period.

The trend of cash flow related indices is shown below.

			(Unit: %)
	FY 2008		FY 2009
Equity ratio		13.6		17.3
Equity ratio at market prices		12.9		14.5

(Note)	1.	Equity ratio = shareholders equity/total assets x 100
	2.	Equity ratio at market prices = total market value of outstanding shares/total assets x 100
	3.	As the main business of the group is insurance, “ratio of cash flow to interest-bearing debt” and “interest coverage ratio” are not provided.

In preparation for deteriorating fundraising conditions caused by cash outflows for payment of claims and by turmoil in the markets, the Group holds adequate liquid assets and is also conducting appropriate fundraising activities while assessing liquidity in terms of both assets and liabilities on the basis of trends in cash inflows and outflows.

(3) Dividends for the current fiscal year

In accordance with the policies above, the Company intends to pay year-end cash dividend of 27 yen per share for the current fiscal year. Added to the interim dividend of 27 yen per share, this will bring the annual dividend for the current fiscal year to 54 yen. Forecast of the annual dividend for the FY 2010 is also 54 yen per share, the same amount with the annual dividend for the FY 2009.

The Company will invest the retained earnings effectively in order to prepare for the changes in business environment by strengthening its business grounds, as well as enhance its financial base.

(Note)

Group core profit is the Company’s own indicator that shows the ordinary earning power of the whole MS&AD Insurance Group. It is calculated by deducting the gains (losses) on sales of stock that had been held as long-term holdings, and, in the case of life insurance subsidiaries, extra expenses such as additional provision for standard liability reserves from net income for the current fiscal year. For more details, please see “3. Management Policy” on page 7.

(4) Business and Other Risks

The key matters pertaining to the Group’s business results and financial condition described in this document that have the potential to materially impact investor decisions are outlined below.

Judgments regarding future projections contained in this section are based on information available at the time this document was released.

(i) Asset management risk

The Group holds various types of investment assets, including off-balance-sheet assets, consisting of marketable securities, loans, real estate and the like, and these assets may decrease in value due to deterioration of the economic environment or financial markets.

The main risks associated with these assets are as follows:

a. Risk of decline in stock prices

The Group holds large amounts of stock for the purpose of maintaining relationships with business partners over the long and medium terms. There is a risk of valuation losses and loss on sales in the event of a large decline in stock prices.

b. Interest rate risk

There is a risk that the prices on holdings of assets such as fixed interest-rate assets such as bonds and loans will decline if interest rates rise.

c. Exchange rate risk

There is a risk that the prices on holdings of assets denominated in foreign currencies, mainly USD and Euro, will decline in response to exchange rate movements.

d. Credit risk

There is a risk that the value of asset holdings such as stocks, corporate bonds and loans will suffer from lowered credit ratings of stock and bond issuers or borrowers, disruptions in the credit markets, and inability to recover principal and interest.

(ii) Risk of large insurance claims due to natural disasters

Natural disasters such as typhoons and earthquakes can give rise to large insurance claims, and the Group hedges such risk through reinsurance and reserves for catastrophic claims. Nevertheless, there is a possibility that large-scale natural disasters could occur as a result of irregular weather associated with global warming and other unexpectedly factors. There is a risk that business results will suffer in any large insurance claims must be paid for such disasters.

(iii) Liquidity risk

With an increase of payments of insurance claims from a natural disaster comes a risk of losses from the necessity of having to procure funds at a cost significantly above normal rates or being forced to sell assets at extremely low prices to raise funds. There

is also a risk of encountering difficulty in borrowing due to poor conditions in the corporate bond market from higher credit risk.

(iv) Reinsurance risk

The Group utilizes reinsurance to reduce its liabilities assumed under insurance contracts and to stabilize earnings. Nevertheless, there is a risk that a worsening of conditions in the reinsurance market leading to a sharp rise in premiums could cause the Group’s cash flows to suffer. There is also a risk that the Group could experience problems securing adequate reinsurance protection which would inhibit its insurance underwriting capabilities.

There is also a credit risk associated with a reinsurance company that could make recovery of reinsurance claims impossible in the event of bankruptcy.

(v) Risk of loss resulting from unforeseen changes, including changes in economic and social environments

Although insurance companies set premiums levels based on forecasts of probable future damages, the actual amount of damages may exceed projections. This is particularly true when the term of coverage is long because of the possibility of significant changes in the economic and social environments beyond initial expectations during which unforeseen damages might occur. Accordingly, there is a risk that earnings may be reduced from the need to increase reserves.

Furthermore, the Group sells long-term third-sector products, life insurance and saving-type insurance that pay a pre-determined fixed rate of return. However, there is a risk that a change in future interest rates could lead to a change in the valuation amount of insurance liabilities based on the original assumed rate of interest.

(vi) Risk of intensified competition from further industry deregulation and increased entry of new participants

The Group is confronted with a business environment that is becoming increasingly harsh due to factors such as new entrants into the insurance industry in conjunction with ongoing deregulation and downward pressure on premium levels. There is a risk that earnings will continue to suffer from further deregulation and the increased entry of new participants.

(vii) Risk associated with overseas business

The Group is aggressively pursuing business overseas in areas such as Asia, Europe and the Americas through branches and subsidiaries. With this come the risks of unexpected changes in the political, economic and social environments of these countries as well as regulatory changes and changing exchange rates.

(viii) Risk of leaks of customer information

The Group maintains large amounts of customer information, including personal information, and any large-scale leak of information poses a risk of loss of trust from customers and society not to mention the possibility of sanctions imposed by supervisory authorities with respect to the management practices leading to such leaks. This, in turn, would impact the Group’s business results.

(ix) Business operation risk

This risk relates to the Group’s business activities and includes the risk of losing the trust of customers and society because of administrative errors, legal violations, impropriety by employees, criminal conduct by outside parties, malfunctions of information systems, and the occurrence of accidents or catastrophe. Moreover, there is also the possibility of sanctions imposed by supervisory authorities in response to any of these problems, which would adversely affect the Group’s business results.

(x) Risk of disruption of business

The Group has formulated a business continuity plan and prepared crisis management measures to respond to the occurrence of natural disasters as an earthquake in the Tokyo area or outbreak of disease such as the H1N1 influenza virus. This framework is intended to limit the duration of any disruption of business and enable business operations to be continued. Despite this, however, if such disruption is greater than anticipated, there is a risk that the Group’s business results and financial condition may suffer.

(xi) Risks from changes in applicable law and procedures

The Group conducts business based on the provisions of applicable laws such as the Insurance Business Law of Japan and issues financial reports in accordance with given accounting standards. Due to any future amendment or enactments of these applicable laws or standards, the methods of selling insurance products, product content, as well as the methods for computing insurance reserves and accounting procedures may be changed. These changes have the potential to adversely affect the Group’s business results.

(xii) Risks associated with merger with Aioi and NDGI

The Group integrated its business operations with Aioi and NDGI through an exchange of shares on April 1, 2010. However, a full merger of the Group with Aioi and NDGI is scheduled to take place on October 1, 2010, The following risks are associated with this merger:

a. The benefits and synergies expected from the merger may not be fully realized.

b. There may be turmoil from delays in preparation for the merger or because of changes of business processes associated with the merger.

c. The costs of the merger may be greater than expected from inability to obtain permits and approvals for the merger.

d. The costs of the merger may increase due to unanticipated circumstances.

2. Corporate Group

As there have been no important changes from “Description of Business” and “Affiliated Companies” in the recent Securities Report (filed on June 25, 2009), this section is omitted.

3. Management Policy

(1) The Company’s Basic Management Policy

As an aspiration for the Group, it has adopted the following Mission, Vision, and Values.

“Mission”

To contribute to the development of a vibrant society and help secure a sound future for the planet, by enabling safety and security through the global insurance and financial services business.

“Vision”

To create a world-leading insurance and financial services group that consistently seeks sustainable growth and to enhance enterprise value.

“Values”

- Customer focused: We continuously strive to provide security and achieve customer satisfaction

- Integrity: We are sincere, kind, fair and just in all our dealings with everyone

- Teamwork: We achieve mutual growth by respecting one another’s individuality and opinions, and by sharing knowledge and ideas

- Innovation: We listen to our stakeholders and continuously seek ways to improve our work and business

- Professionalism: We make sustained efforts to improve our skills and proficiency so that we can provide high quality services

(2) Target Management Indices

The Group aims to enhance corporate value by realizing sustainable growth cycle placing improvement of quality at its core, based on the new mid-term management plan “MS&AD New Frontier 2013” launched in FY 2010. The Group also notes “Consolidated Net Premiums Written” and “ROE based on Group Core Profit” (note 1) as the Group’s target management indices, and has adopted medium-term target for FY 2013 as 2.7 trillion yen of consolidated net premiums written and 7% of the ROE based on Group Core Profit.

(Note 1) ROE based on Group Core Profit=Group Core Profit (Note 2) ÷ Consolidated shareholders’ equity (excluding minority interest; average of starting and ending amounts)

(Note 2) Group’s Core Profit = consolidated net income − net capital gains/losses on stock portfolio (gains/losses from sale, etc.) − net evaluation gains/losses on credit derivatives − other incidental factors + equity in earnings of the non-consolidated group companies

(3) The Company’s Medium- to Long-term Management Strategy and Issues that Need to be Addressed

4. Consolidated Financial Statements

(1) Consolidated Balance Sheets

				(Yen in millions)
Items	As of March 31, 2009			As of March 31, 2010
	Amount			Amount
(Assets)
Cash deposits and savings		452,057			313,389
Call loans		31,900			33,700
Securities bought under resale agreements		—			15,998
Monetary claims bought		127,339			108,158
Money trusts		14,476			10,592
Investments in securities		5,110,839			5,497,537
Loans		768,400			749,524
Tangible fixed assets:		262,662			255,039
Land		103,117			100,852
Buildings		134,635			129,358
Construction in progress		1,429			4,427
Other tangible fixed assets		23,480			20,400
Intangible fixed assets:		74,497			78,967
Software		6,876			11,927
Goodwill		63,951			63,004
Other intangible fixed assets		3,669			4,035
Other assets		463,442			459,454
Deferred tax assets		141,831			6,411
Bad debts reserve		(6,737	)		(9,149	)
Total assets		7,440,709			7,519,625
(Liabilities)
Underwriting funds:		5,848,454			5,781,233
Outstanding claims		793,498			753,784
Underwriting reserves		5,054,956			5,027,448
Debentures		164,960			94,969
Other liabilities		300,724			198,587
Reserve for pension and retirement benefits		80,958			82,424
Reserve for pension and retirement benefits for officers and operating officers		2,409			2,092
Accrued bonuses for employees		12,365			12,713
Reserve under the special law:		4,240			4,302
Reserve for price fluctuation		4,240			4,302
Deferred tax liabilities		3,574			32,221
Total liabilities		6,417,688			6,208,542
(Net assets)
Shareholders’ equity:
Common stock		100,000			100,000
Capital surplus		132,689			132,690
Retained earnings		527,578			541,520
Treasury stock		(4,644	)		(14,687	)
Total shareholders’ equity		755,623			759,522
Valuation and translation adjustments:
Unrealized gains on investments, net of tax		295,558			582,980
Deferred hedge gains (losses), net of tax		9,671			2,138
Foreign currency translation adjustments		(49,625	)		(40,309	)
Total valuation and translation adjustments		255,603			544,809
Minority interests		11,794			6,750
Total net assets		1,023,021			1,311,082
Total liabilities and net assets		7,440,709			7,519,625

(2) Consolidated Statements of Income

				(Yen in millions)
Items	FY 2008			FY 2009
	Amount			Amount
Ordinary income and expenses:
Ordinary income:		2,040,013			1,962,689
Underwriting income:		1,831,877			1,812,669
Net premiums written		1,445,651			1,394,164
Deposit premiums from policyholders		165,464			145,026
Investment income on deposit premiums from policyholders		52,874			54,075
Life insurance premiums		133,367			135,165
Reversal of outstanding claims		—			49,876
Reversal of underwriting reserves		33,027			31,417
Other underwriting income		1,491			2,942
Investment income:		203,199			139,902
Interest and dividends received		169,340			143,896
Investment gains on money trusts		118			675
Gains on sale of securities		76,713			19,695
Gains on redemption of securities		3,726			1,727
Gains on derivative transactions		576			24,777
Other investment income		5,598			3,206
Transfer of investment income on deposit premiums from policyholders		(52,874	)		(54,075	)
Other ordinary income:		4,936			10,118
Equity in gains of affiliates		—			4,878
Other ordinary income		4,936			5,239
Ordinary expenses:		2,053,058			1,909,994
Underwriting expenses:		1,569,947			1,561,117
Net claims paid		892,710			914,691
Loss adjustment expenses		82,270			80,547
Commission and collection expenses		245,696			243,136
Maturity refunds to policyholders		283,405			278,423
Dividends to policyholders		507			1,062
Life insurance claims		36,438			41,716
Provision for outstanding claims		25,002			—
Other underwriting expenses		3,915			1,538
Investment expenses:		170,096			47,021
Investment losses on money trusts		2,661			21
Losses on sale of securities		17,830			17,419
Losses on devaluation of securities		118,122			6,065
Losses on redemption of securities		9,358			4,435
Other investment expenses		22,123			19,079
Operating expenses and general and administrative expenses		302,350			294,960
Other ordinary expenses:		10,664			6,894
Interest paid		1,625			2,254
Provision for bad debts reserve		1,971			2,044
Loss on bad debts		270			131
Equity in losses of affiliates		4,243			—
Other ordinary expenses		2,554			2,463
Ordinary profit (loss)		(13,044	)		52,695
Extraordinary income and losses:
Extraordinary income:		27,136			3,592
Gains on sale of fixed assets		1,414			3,592
Reversal of reserve under the special law		25,721			—
Reversal of reserve for price fluctuation		25,721			—
Extraordinary losses:		3,666			6,048
Losses on sale of fixed assets		2,621			2,555
Impairment losses on fixed assets		1,044			3,431
Provision for reserve under the special law		—			61
Provision for price fluctuation reserve		—			61
Income before income taxes		10,425			50,238
Income taxes — current		34,333			18,778
Refund of income taxes for prior periods		(7,307	)		(13,950	)
Income taxes — deferred		(25,161	)		7,330
Total income taxes		1,864			12,158
Minority Interests		369			439
Net income		8,192			37,640

(3) Consolidated Statement of Changes in Net Assets

	FY 2008			FY 2009
	(From April 1, 2008			(From April 1, 2009
	to March 31, 2009)			to March 31, 2010)
Shareholder’s equity
Common stock
Balance as of the end of previous FY		—			100,000
Change this year
Increase due to share transfer		100,000			—
Total change this year		100,000			—
Balance as of the end of current FY		100,000			100,000
Capital surplus
Balance as of the end of previous FY		—			132,689
Change this year
Increase from share transfer		132,703			—
Disposal of treasury stock		(13	)		0
Total change this year		132,689			0
Balance as of the end of current FY		132,689			132,690
Retained earnings
Balance as of the end of previous FY		—			527,578
Change this year
Increase due to share transfer		534,410			—
Changes due to application of Practical Issues Task Force Report No. 18		8,986			—
Dividend of retained earnings		(24,011	)		(22,641	)
Change of scope of consolidation					(1,055	)
Net income for this year		8,192			37,640
Total change this year		527,578			13,942
Balance as of the end of current FY		527,578			541,520
Treasury stock
Balance as of the end of previous FY		—			(4,644	)
Change this year
Acquisition of treasury stock		(4,724	)		(10,048	)
Disposal of treasury stock		80			4
Total changes this year		(4,644	)		(10,043	)
Balance as of the end of current FY		(4,644	)		(14,687	)
Total shareholder’s equity
Balance as of the end of previous FY		—			755,623
Change this year
Increase due to share transfer		767,113			—
Changes due to application of Practical Issues Task Force Report No. 18		8,986			—
Dividend of retained earnings		(24,011	)		(22,641	)
Change of scope of consolidation		—			(1,055	)
Net income for the year		8,192			37,640
Acquisition of treasury stock		(4,724	)		(10,048	)
Disposal of Treasury stock		66			5
Total change this year		755,623			3,899

	FY 2008			FY 2009
	(From April 1, 2008			(From April 1, 2009
	to March 31, 2009)			to March 31, 2010)
Balance as of the end of current FY		755,623			759,522
Valuation and translation adjustments
Valuation differences of other marketable securities
Balance as of the end of previous FY		—			295,558
Change this year
Change (net) this year on items other than shareholders’ equity		295,558			287,422
Total change this year		295,558			287,422
Balance as of the end of current FY		295,558			582,980
Deferred hedge profits/losses
Balance as of the end of previous FY		—			9,671
Change this year
Change (net) this year on items other than shareholders’ equity		9,671			(7,532	)
Total change this year		9,671			(7,532	)
Balance as of the end of current FY		9,671			2,138
Foreign currency translation adjustments
Balance as of the end of previous FY		—			(49,625	)
Change this year
Change (net) this year on items other than shareholders’ equity		(49,625	)		9,316
Total change this year		(49,625	)		9,316
Balance as of the end of current FY		(49,625	)		(40,309	)
Total valuation and translation adjustments
Balance as of the end of previous FY		—			255,603
Change this year
Change (net) this year on items other than shareholders’ equity		255,603			289,206
Total change this year		255,603			289,206
Balance as of the end of current FY		255,603			544,809
Minority interests
Balance as of the end of previous FY		—			11,794
Change this year
Change (net) this year on items other than shareholders’ equity		11,794			(5,044	)
Total change this year		11,794			(5,044	)
Balance as of the end of current FY		11,794			6,750
Total net assets
Balance as of the end of previous FY		—			1,023,021
Change this year
Increase from share transfer		767,113			—
Changes due to application of Practical Issues Task Force Report No. 18		8,986			—
Dividend of retained earnings		(24,011	)		(22,641	)
Change of scope of consolidation		—			(1,055	)
Net income for this year		8,192			37,640
Acquisition of treasury stock		(4,724	)		(10,048	)
Disposal of treasury stock		66			5
Change (net) this year on items other than shareholders’ equity		267,398			284,161
Total change this year		1,023,021			288,060
Balance as of the end of current FY		1,023,021			1,311,082

(4) Consolidated Statements of Cash Flows

(Yen in millions)

	FY 2008			FY 2009
	(From April 1, 2008			(From April 1, 2009
	to March 31, 2009)			to March 31, 2010)
Cash flows from operating activities
Income before income taxes		10,425			50,238
Depreciation		22,157			22,897
Impairment loss on fixed assets		1,044			3,431
Amortization of goodwill		4,126			4,265
Amortization of negative goodwill		(16	)		(20	)
Increase(decrease) in outstanding claims		36,371			(53,150	)
Increase(decrease) in underwriting reserve		(32,255	)		(33,813	)
Increase(decrease) in bad debts reserve		1,777			2,318
Increase(decrease) in reserve for employees’ retirement and severance benefits		3,165			1,417
Increase(decrease) in reserve for pension and retirement benefits for officers and operating officers		(297	)		(317	)
Increase(decrease) in accrued bonuses for employees		(772	)		317
Increase(decrease) in reserve for price fluctuation		(25,721	)		61
Interest and dividend income		(169,340	)		(143,896	)
Losses(gains) on investment in securities		64,871			6,497
Losses(gains) on investment in derivative transactions		(576	)		(24,777	)
Interest expenses		1,625			2,254
Foreign exchange losses(gains)		8,494			364
Losses(gains) on disposal of tangible fixed assets		1,206			(1,036	)
Equity in losses(gains) of affiliates		4,243			(4,878	)
Decrease(increase) in other assets		(27,553	)		(16,062	)
Increase(decrease) in other liabilities		(2,415	)		(4,914	)
Others		9,672			14,259
Subtotal		(89,767	)		(174,543	)
Interest and dividends received		169,309			145,400
Interest paid		(1,652	)		(2,331	)
Income tax paid		(39,276	)		(24,518	)
Income tax refunded		—			22,062
Total cash flows from operating activities		38,612			(33,930	)
Cash flows from investing activities
Net increase(decrease) in deposit at banks		(43,923	)		22,411
Purchase of monetary claims bought		(3,000	)		—
Proceeds from sales and redemption of monetary claims bought		3,692			4,934
Purchase of money trusts		(3	)		(13	)
Proceeds from sales of money trusts		33,090			5,400
Purchase of securities		(890,529	)		(694,015	)
Proceeds from sales and redemption of securities		953,708			777,651
Investment in loans		(207,492	)		(196,526	)
Collection of loans		240,622			214,682
Increase(decrease) in cash received under securities lending transactions		24,466			(60,508	)
Others		4,980			(391	)
Total cash flows from financial investments		115,611			73,625
Total cash flows from operating activities and financial investments		154,224			39,695
Acquisition of tangible fixed assets		(17,572	)		(17,387	)
Proceeds from sales of tangible fixed assets		2,775			5,373
Acquisition of intangible fixed assets		(2,657	)		(8,300	)
Others		(3,661	)		(569	)
Total cash flows from investing activities		94,495			52,741
Cash flows from financing activities
Issuance of short-term bonds		16,949			—
Redemption of short-term bonds		(47,000	)		—

	FY 2008			FY 2009
	(From April 1, 2008			(From April 1, 2009
	to March 31, 2009)			to March 31, 2010)
Issuance of corporate bonds		64,967			—
Redemption of corporate bonds		—			(70,000	)
Acquisition of treasury stock		(4,724	)		(10,048	)
Cash dividends paid		(23,987	)		(22,610	)
Cash dividends paid to minority shareholders		(1,235	)		(910	)
Others		(785	)		(751	)
Total cash flows from financing activities		4,184			(104,320	)
Effect of exchange rate changes on cash and cash equivalents		(45,943	)		8,553
Net change in cash and cash equivalents		91,349			(76,955	)
Balance of cash and cash equivalents at beginning of fiscal year		364,081			455,430
Decrease of cash and cash dividends due to exclusion from consolidation		—			(1,316	)
Balance of cash and cash equivalents as of the end of FY		455,430			377,158

(5) Notes regarding Going Concern Assumption

Not Applicable

(6) Basis of Presenting Consolidated Financial Statements

		Current Consolidated Fiscal Year
Items		(From April 1, 2009 to March 31, 2010)
1. Matters concerning Scope of Consolidation		Number of consolidated subsidiaries:
		Names of principal consolidated subsidiaries:
		Mitsui Sumitomo Insurance Co., Ltd. Mitsui Sumitomo Kirameki Life Insurance Co., Ltd. MSIG Holdings (Americas), Inc. Mitsui Sumitomo Insurance (London Management) Ltd MSIG Mingtai Insurance Co., Ltd.
		Due to the Company having newly established MSIG Insurance (Lao) Co., Ltd., this firm has been included in the scope of consolidation from the current fiscal year.
		On the contrary, Mitsui Sumitomo Insurance Company (Hong Kong) Limited and Thousand Fortune Islands Corporation has been excluded from the scope of consolidation from the current fiscal year, due to loss of importance from business reorganization for the former and for the latter, redemption of its debentures the Company held which made the Company its parent company since the Company covered more than half the amount of its financing.
2. Matters concerning Accounting		(1) Standards and methods of valuation for securities (including items classified as “Cash deposits and savings” or “Monetary claims bought” under the Enforcement Regulations for the Insurance Business Law)
		(i) Valuations of held-to-maturity securities are according to the depreciation cost method.
		(ii) Valuations of shares of unconsolidated subsidiaries and affiliated companies not accounted for by the equity method are according to the cost method on a moving average cost basis.
		(iii) Valuations of “underwriting reserve supported bonds” in accordance with the “Interim Handling for Accounting and Auditing of the “underwriting reserve supported bonds” in the Insurance Industry” (Report No. 21 issued by the Industrial Classification Audit Committee, The Japanese Institute of Certified Public Accountants, November 16, 2000) are according to the depreciation cost method on a moving average cost basis.
		A summary of the newly established risk management policy for underwriting reserve supported bonds is as follows:
		The Company is establishing a small segment of the “lump-sum payment old-age insurance” that was launched at a consolidated life insurance

		Current Consolidated Fiscal Year
Items		(From April 1, 2009 to March 31, 2010)
		subsidiary to appropriately manage fluctuation risks for the interest accruing on its assets and the owed interest accruing on its liabilities, and will adopt an operating policy of matching the duration of the underwriting reserve supported bonds with the underwriting reserve during fixed intervals.
		(iv) Valuations of marketable securities classified as other securities are according to market value as of the end of the fiscal year under review with changes in unrealized holding gain or loss, net of the applicable income taxes, included directly in net assets. The cost of securities sold is also calculated by the moving average method.
		(v) Valuations of securities classified as other securities of which price are extremely difficult to be determined are according the depreciation cost method on a moving average cost basis.
		(vi) Valuations of securities managed as trust assets and included in money trusts that are independently managed mainly for the purpose of securities investment are according to the market price method.
		(Change in principles of accounting methods and accounting procedures) Application of “Accounting Standard for Financial Instruments”
		The scope of marketable securities has been changed from this current fiscal year applying “Accounting Standard for Financial Instruments” (Corporate Accounting Standard No. 10 (last amended on March 10, 2008)). Application of the accounting standard has little influence on the consolidated financial statements.
		(2) Reserve for retirement benefits for employees
		To provide a reserve for the retirement benefits of employees, an amount recognized as incurred at the end of the consolidated fiscal year is calculated based on the estimated amount of benefits obligations and plan assets as of March 31, 2009.
		Prior service cost is amortized as incurred by the straight-line method over the average remaining years of service of the employees.
		Actuarial gains or losses are amortized in the year following the year in which such difference occurred by the straight-line method over the average remaining years of services of the employees.
		Some consolidated subsidiaries adopt the simplified tax effect accounting method for the purpose of calculating the retirement benefit obligations.
		(Change in principles of accounting methods and accounting procedures)
		Application of “3rd Amendment to “Accounting Standard for Retirement Benefits””
		“3rd Amendment to “Accounting Standard for Retirement Benefits”” (Corporate Accounting Standard No. 19 (last amended on July 31, 2008)) has been applied from this current fiscal year. Application of the accounting standard has no

		Current Consolidated Fiscal Year
Items		(From April 1, 2009 to March 31, 2010)
		influence on the consolidated financial statements, since the same reduction rate as the former method is applied.

(Note) As there have been no important changes from the recent Securities Report (filed on June 25, 2009), notes other than shown above is omitted.

(7) Notes about the Consolidated Financial Statements

(Notes to Consolidated Balance Sheet)

Current Consolidated Fiscal Year (From April 1, 2009 to March 31, 2010)

1. The cumulative amount of depreciation intangible fixed assets is ¥286,738 million, and the advanced depreciation amount is ¥18,713 million.

2. The shares of non-consolidated subsidiaries and affiliated companies are as follows:

Securities (stock):		¥28,577 million
Securities (foreign securities):		¥7,972 million
Securities (other securities):		¥6,164 million

3. The amount of loans to financially impaired parties, overdue loans, receivables in arrears for three months or more, receivables to which eased loan conditions were granted, and the total amount thereof are as follows:

(1) Loans to financially impaired parties and overdue loans mount to ¥1,441 million and ¥2,426 million, respectively.

(2) Among loans receivables, receivables in arrears for three months or more amounts to ¥855 million.

(3) Among loans receivables, receivables to which eased loan conditions were granted amount to ¥2,043 million.

5. Investment securities include loans in the aggregate amount of ¥39,791 million by a loan for consumption agreement.

6. Mitsui Sumitomo Insurance Co., Ltd. is guaranteeing the execution of transactions that limited partnerships undertake. The total present value of such transactions covered by this guarantee as of March 31, 2010 amounts to ¥177,933 million, but they have not been reckoned as customer liabilities under acceptance and guarantees or as liabilities under acceptance and guarantees because there is no substantial guaranteed amount taking account of collaterals.

7. The Company has entered into an agreement with Mitsui Sumitomo Insurance Co., Ltd. to maintain net assets with Mitsui Sumitomo MetLife Insurance Co., Ltd., an affiliated company of ours, in order to provide funds in case the amount of net assets of that company is lower than specified standards or current assets are insufficient for the payment of loans. Total liabilities of Mitsui Sumitomo MetLife Insurance Co., Ltd. as of March 31, 2010 amount to ¥3,081,115 million (including underwriting funds of ¥3,068,340 million) and total assets amount to ¥3,116,508 million.

8. The balance of loans un-extended for loan commitment agreements is ¥1,856 million.

(Notes to Consolidated Statements of Income)

Current Consolidated Fiscal Year (From April 1, 2009 to March 31, 2010)

1. A breakdown of major business expenses is as follows:

Agency commissions		¥252,437 million
Salaries		¥141,502 million

2. Impairment losses on the following assets for the fiscal year under review are as stated below:

Impairment

(Millions of yen)

Holding purpose

Types

Properties

loss

Item

Real property for rent

Land & buildings

Total of 2 properties including building for rent owned by the Company in Aichi Prefecture

1,358

Land Buildings

526 831

Idle real property and real property for sale

Land & buildings

Total of 3 properties including house buildings for employees owned by the Company in Chiba Prefecture

2,073

Land Buildings

1,882 190

(Notes to Consolidated Statements of Net Assets)

Current Fiscal Year (From April 1, 2009 through March 31, 2010)

1. Matters concerning class and total number of shares issued and class and total number of shares of treasury stock

			Number of shares		Number of shares
			increased during		decreased during
	Number of shares as		the fiscal year		the fiscal year		Number of shares as
	of March 31, 2008		under review		under review		of March 31, 2009
	(1000 shares)		(1000 shares)		(1000 shares)		(1000 shares)
Shares issued
Shares of common stock		421,320		—		—		421,320
Total		421,320		—		—		421,320
Treasury stock
Shares of common stock		2,020		4,348		2		6,367
Total		2,020		4,348		2		6,367

(Note)	1.		The increase of 4,348 thousand shares of treasury stock of common stock is owing to an increase of 4,329 thousand shares resulting from purchases of shares in the market and an increase of 19 thousand shares resulting from purchase of sub-lot shares by the Company.
	2.		The decrease of 2 thousand shares of common stock is due to the sale of sub-lot shares.

2. Matters concerning Cash Dividends

(1) Dividends paid

Total amount of

dividends

Dividend per share

Resolutions

Class of shares

(Millions of yen)

(in Yen)

Record date

Effective date

Annual Shareholders Meeting held on June 25, 2009

Shares of common stock

11,321

Mar. 31, 2009

June 26, 2009

Meeting of the Board of Directors held on November 19, 2009

Shares of common stock

11,320

Sept. 30, 2009

Dec. 10, 2009

(2) Of the dividends whose record date was in the accounting year under review, those dividends whose effective date will be in the following accounting year

Total amount of

Resolution

dividends

Dividend per share

(scheduled)

Class of shares

(Millions of yen)

Dividend assets

(in Yen)

Record date

Effective date

Annual Shareholders Meeting to be held on June 29, 2010

Shares of common stock

11,203

Retained earnings

Mar. 31, 2010

June 30, 2010

(Notes to Consolidated Statements of Cash Flows)

Current Consolidated Fiscal Year (From April 1, 2009 to March 31, 2010)

1. Reconciliation of balance sheet items to cash and cash equivalents outstanding

(As of March 31, 2010)
(Yen in millions)
Cash, deposits and savings	313,389
Call loans	33,700
Receivables under resale agreements	15,998
Monetary claims bought	108,158
Money trust	10,592
Securities	5,497,537
Time deposit with an original maturity of more than 3 months	(58,376	)
Monetary claims bought other than cash equivalents	(73,359	)
Money trust other than cash equivalents	(9,092	)
Securities other than cash equivalents	(5,461,390	)
Cash and cash equivalents	377,158

2. Significant non-cash transaction

The value of assets and liabilities recorded on new finance lease transactions in the current fiscal year was 1,058 million yen.

3. Cash flows from investing activities include cash flows from investments made as part of the insurance business.

(Segment Information)

a. Segment information by lines of business

Previous Consolidated Fiscal Year (From April 1, 2008 through March 31, 2009)

(Yen in millions)

	Non-Life		Life				Eliminations or
	insurance		insurance		Total		corporate		Consolidated
I. Ordinary income and ordinary profit/loss
Ordinary income
(1) Ordinary income from external customers		1,964,022		153,536		2,117,558		77,544		2,040,013
(2) Ordinary income arising from inter segment transactions		2,958		—		2,958		2,958		—
Total		1,966,981		153,536		2,120,517		80,503		2,040,013
Ordinary expenses		1,975,555		157,450		2,133,005		79,947		2,053,058
Ordinary loss		8,574		3,913		12,488		556		13,044
II. Assets, depreciation, impairment losses on fixed assets and capital expenditure
Assets		6,328,170		1,090,883		7,419,053		21,656		7,440,709
Depreciation		21,892		264		22,157		—		22,157
Impairment losses on fixed assets		1,044		—		1,044		—		1,044
Capital expenditure		21,837		379		22,216		—		22,216

(Note)

1.		The categories of operations are grouped to show the actual state of operations of the parent and consolidated subsidiaries.
2.		The principal categories of operations are:

Non-life insurance operations: Non-life insurance underwriting business and asset investment business

Life insurance operations: Life insurance underwriting business and asset investment business

3. A major component of the “Eliminations or corporate” for “Ordinary income from external customers” for the current financial year is the transfer from “Provision of underwriting reserve” in “Ordinary expenses”, which is included in “Life Insurance segment”, to “Reversal for underwriting reserve” in “Ordinary income” in the interim consolidated statements of income. 4. Unallocated ordinary expenses within ordinary expenses for the current fiscal year included in “Eliminations or corporate” is ¥3,399 million, and major part of it is expenses concerning management sections of the Company. 5. Corporate assets of assets for the current fiscal year included in “Eliminations or corporate” is ¥22,529 million, and major part of it is estimated refund of income taxes concerning dividends from its subsidiaries which was withheld from the Company at the source. 6. Change in accounting policy Application of “Practical Solution on Unification of Accounting Policies Applied to Foreign Subsidiaries for Consolidated Financial Statements” In accordance with “Practical Solution on Unification of Accounting Policies Applied to Foreign Subsidiaries for Consolidated Financial Statements” (Practical Issues Task Force Report No. 18, May 17, 2006), applicable from a consolidated fiscal year commencing on or after April 1, 2008, the Company made necessary adjustments in its consolidated financial statements from the current interim consolidated accounting period. Compared with the method previously adopted by Mitsui Sumitomo Insurance Company, Limited, the wholly-owned subsidiary that conducted the share transfer, in preparing its consolidated financial statements, application of the above standard had the effect increasing decreasing ordinary income by ¥475 million, increasing ordinary expenses by ¥1,392 million and ¥161 million, and also increasing ordinary loss by ¥1,867 million, in “Non-Life insurance segment”.

Current Consolidated Fiscal Year (From April 1, 2009 through March 31, 2010)

(Yen in millions)

	Non-Life		Life				Eliminations or
	insurance		insurance		Total		corporate		Consolidated
I. Ordinary income and ordinary profit/loss
Ordinary income
(1) Ordinary income from external customers		1,875,074		160,476		2,035,550		72,861		1,962,689
(2) Ordinary income arising from inter segment transactions		1,642		—		1,642		1,642		—
Total		1,876,716		160,476		2,037,193		74,503		1,962,689
Ordinary expenses		1,828,707		155,452		1,984,159		74,165		1,909,994
Ordinary profit		48,009		5,023		53,033		338		52,695
II. Assets, depreciation, impairment losses on fixed assets and capital expenditure
Assets		6,343,385		1,168,528		7,511,914		7,711		7,519,625
Depreciation		22,337		556		22,893		3		22,897
Impairment losses on fixed assets		3,431		—		3,431		—		3,431
Capital expenditure		24,144		2,727		26,871		173		27,044

(Note)

1.		The categories of operations are grouped to show the actual state of operations of the parent and consolidated subsidiaries.
2.		The principal categories of operations are:

Non-life insurance operations: Non-life insurance underwriting business and asset investment business

Life insurance operations: Life insurance underwriting business and asset investment business

b. Segment information by location

Previous Consolidated Fiscal Year (From April 1, 2008 through March 31, 2009)

(Yen in millions)

													Eliminations or
	Japan		Asia		Europe			Americas		Total			corporate		Consolidated
I Ordinary income and ordinary profit/loss
Ordinary income
(1) Ordinary income from external customers		1,858,705		77,704		94,631			41,190		2,072,231			32,217		2,040,013
(2) Ordinary income arising from inter segment transactions		5,462		247		75			20		5,806			5,806		—
Total		1,864,167		77,952		94,706			41,211		2,078,038			38,024		2,040,013
Ordinary expenses		1,845,811		74,505		131,036			34,527		2,085,881			32,822		2,053,058
Ordinary profit/(loss)		18,356		3,446		(36,329	)		6,683		(7,842	)		5,201		(13,044	)
II Assets		6,813,907		226,456		229,669			161,272		7,431,305			9,404		7,440,709

(Note)

1.		The categories of countries or regions are based on geographic proximity.
2.		The principal countries or regions belonging to categories other than Japan are,

(1) Asia: Malaysia, Taiwan and Singapore

(2) Europe: U.K. and Ireland

(3) Americas: U.S.A., Brazil and Bermuda

3. A major component of the “Eliminations or corporate” for “Ordinary income from external customers” for the current fiscal year is the transfer from “Reversal of outstanding claims” in “Ordinary income” included in “Japan segment”, to “Provision for outstanding claims” in “Ordinary expenses” in the consolidated statements of income. 4. Unallocated ordinary expenses within ordinary expenses for the current fiscal year included in “Eliminations or corporate” is ¥3,399 million, and major part of it is expenses concerning management sections of the Company. 5. Corporate assets of assets for the current fiscal year included in “Eliminations or corporate” is ¥22,529 million, and major part of it is estimated refund of income taxes concerning dividends from its subsidiaries which was withheld from the Company at the source. 6. Change in accounting policy Application of “Practical Solution on Unification of Accounting Policies Applied to Foreign Subsidiaries for Consolidated Financial Statements” In accordance with “Practical Solution on Unification of Accounting Policies Applied to Foreign Subsidiaries for Consolidated Financial Statements” (Practical Issues Task Force Report No. 18, May 17, 2006), applicable from a consolidated fiscal year commencing on or after April 1, 2008, the Company made necessary adjustments in its consolidated financial statements from the current interim consolidated accounting period. Compared with the method previously adopted by Mitsui Sumitomo Insurance Company, Limited, the wholly-owned subsidiary that conducted the share transfer, in preparing its consolidated financial statements, application of the above standard had the effect of increasing ordinary expenses by ¥946 million and decreasing ordinary profit by the same amount, respectively, in “Asia segment”, decreasing ordinary income by ¥879 million, increasing ordinary expenses by ¥12 million and decreasing ordinary profit by ¥891 million, respectively, in “Europe segment”, and increasing ordinary expenses by ¥29 million and decreasing ordinary profit by the same amount, respectively, in “Americas segment”.

Current Consolidated Fiscal Year (From April 1, 2009 through March 31, 2010)

(Yen in millions)

											Eliminations or
	Japan		Asia		Europe		Americas		Total		corporate		Consolidated
I Ordinary income and ordinary profit/loss
Ordinary income
(1) Ordinary income from external customers		1,745,539		72,802		105,887		43,950		1,968,179		5,489		1,962,689
(2) Ordinary income arising from inter segment transactions		7,703		266		86		14		8,070		8,070		—
Total		1,753,242		73,069		105,973		43,964		1,976,250		13,560		1,962,689
Ordinary expenses		1,714,097		64,964		104,052		33,656		1,916,771		6,776		1,909,994
Ordinary profit/(loss)		39,144		8,105		1,920		10,308		59,478		6,783		52,695
II Assets		6,911,802		236,388		209,031		164,382		7,521,605		1,980		7,519,625

(Note)

1.		The categories of countries or regions are based on geographic proximity.
2.		The principal countries or regions belonging to categories other than Japan are,

(1) Asia: Malaysia, Taiwan and Singapore

(2) Europe: U.K. and Ireland

(3) Americas: U.S.A., Brazil and Bermuda

3. A major component of the “Eliminations or corporate” for “Ordinary income from external customers” for the current fiscal year is the transfer from “Provision of underwriting reserve” in “Ordinary expenses is included in “Asia segment” and “Americas segment”, to “Reversal for underwriting reserve” in “Ordinary income” in the consolidated statements of income. 4. Unallocated ordinary expenses within ordinary expenses for the current fiscal year included in “Eliminations or corporate” is ¥3,078 million, and major part of it is expenses concerning management sections of the Company. 5. Corporate assets of assets for the current fiscal year included in “Eliminations or corporate” is ¥8,158 million, and major part of it is estimated refund of income taxes concerning dividends from its subsidiaries which was withheld from the Company at the source.

c. Overseas sales

Previous Consolidated Fiscal Year (From April 1, 2008 through March 31, 2009)

(Yen in millions)

	Asia		Europe		Americas		Total
I Overseas sales		111,135		94,590		53,514		259,240
II Consolidated sales								2,040,013
III Proportion of overseas sales to consolidated sales (%)		5.45		4.64		2.62		12.71

(Note)

1.		The categories of countries or regions are based on geographic proximity.
2.		The principal countries or regions belonging to categories other than Japan are,

(1) Asia: Malaysia, Taiwan and Singapore

(2) Europe: U.K. and Ireland

(3) Americas: U.S.A., Brazil and Bermuda

3. Overseas sales are the sum of overseas sales of the consolidated domestic subsidiaries and ordinary income of the consolidated overseas subsidiaries.

Current Consolidated Fiscal Year (From April 1, 2009 through March 31, 2010)

(Yen in millions)

	Asia		Europe		Americas		Total
I Overseas sales		102,367		105,754		54,139		262,262
II Consolidated sales								1,962,689
III Proportion of overseas sales to consolidated sales (%)		5.22		5.39		2.76		13.36

(Note)

1.		The categories of countries or regions are based on geographic proximity.
2.		The principal countries or regions belonging to categories other than Japan are,

(1) Asia: Malaysia, Taiwan and Singapore

(2) Europe: U.K. and Ireland

(3) Americas: U.S.A., Brazil and Bermuda

3. Overseas sales are the sum of overseas sales of the consolidated domestic subsidiaries and ordinary income of the consolidated overseas subsidiaries.

(Tax Effect Accounting)

Previous Consolidated Fiscal Year (From April 1, 2008 through March 31, 2009)

1. Significant components of deferred tax assets and liabilities

	(Yen in millions)
Deferred tax assets
Investment in securities		49,813
Land		11,440
Software		21,006
Underwriting reserve		171,214
Outstanding claims		21,562
Reserves for pension and retirement benefits		29,084
Other		40,829
Total gross deferred tax assets		344,951
Less valuation allowance		(23,974	)
Total net deferred tax assets		320,977
Deferred tax liabilities
Unrealized gains on investments		(167,880	)
Other		(14,840	)
Total gross deferred tax liabilities		(182,720	)
Total deferred tax liabilities net of deferred tax assets		138,256

2. A reconciliation of the significant difference between domestic statutory tax rate and the effective income tax rate after application of deferred tax accounting is as follows

	(Units: %)
Domestic statutory tax rate		40.7
(Adjustments)
Losses at consolidated subsidiaries (tax effect unrecognized)		132.5
Deduction for dividends received		(88.8	)
Deemed capital losses due to property dividend at consolidated subsidiaries		(87.9	)
Tax rate difference from consolidated subsidiaries		(37.0	)
Elimination of dividends received from consolidated subsidiaries		19.8
Investment profit/losses by equity method		18.5
Depreciation of goodwill and negative goodwill		16.3
Other		3.8
Applied tax rates of income taxes after application of tax effect accounting		17.9

Current Consolidated Fiscal Year (From April 1, 2009 through March 31, 2010)

1. Significant components of deferred tax assets and liabilities

	(Yen in millions)
Deferred tax assets
Investment in securities		41,157
Land		12,354
Software		20,498
Underwriting reserve		181,499
Outstanding claims		24,221
Reserves for pension and retirement benefits		29,602
Other		28,915
Total gross deferred tax assets		338,248
Less valuation allowance		(23,886	)
Total net deferred tax assets		314,362
Deferred tax liabilities
Unrealized gains on investments		(328,939	)
Other		(11,232	)
Total gross deferred tax liabilities		(340,171	)
Total deferred tax liabilities net of deferred tax assets		(25,809	)

2. A reconciliation of the significant difference between domestic statutory tax rate and the effective income tax rate after application of deferred tax accounting is as follows

	(Units: %)
Domestic statutory tax rate		40.7
(Adjustments)
Tax rate difference from consolidated subsidiaries		(13.0	)
Deduction for dividends received		(11.2	)
Elimination of dividends received from consolidated subsidiaries		5.8
Other		1.9
Applied tax rates of income taxes after application of tax effect accounting		24.2

(Financial Products)

1. Matters relating to status of financial instruments

(1) Policy regarding financial instruments

The MS&AD Insurance Group (“the Group”) aims to increase net assets based on market value by increasing returns that take into account all kinds of costs (return after cost deduction), including funding costs, various expenses, and costs associated with risk. While considering liquidity, the Group manages assets by utilizing financial instruments. To prepare for the payment of liabilities associated with insurance policies, such as insurance payments, maturity repayments, and cancellation returns, Mitsui Sumitomo Insurance Co., Ltd. is endeavoring to insure the stability of returns on investment and the security of assets by continually adopting measures to improve risk management methods, such as the promotion of asset liability management (ALM) that takes into account the characteristics of these liabilities. In addition, the basic policy of Mitsui Sumitomo Kirameki Life Insurance Co., Ltd. is to secure stable earnings over the long term by placing the utmost priority on security while focusing on ALM.

(2) Description of financial instruments and associated risks

Concerning derivatives where hedge accounting is applied Mitsui Sumitomo Insurance Co., Ltd. accounts for stock transfer contracts for hedging risks arising from stock price fluctuations

under the deferral hedge accounting method. Currency swap contracts for hedging foreign exchange risks related to foreign-denominated bonds are accounted for under the deferral hedge accounting method, and some forward exchange contracts are accounted for under the fair value hedge accounting method or subject to appropriation. Interest rate swap contracts for hedging risks arising from fluctuations in cash flow of loans or bonds relating to fluctuations in interest rates are accounted for using the deferral hedge accounting method or the exceptional method.

Also, interest rate swap contracts executed to appropriately control the risk of fluctuations in interest rates with respect to ALM (asset—liability management) are accounted for using the deferral hedge accounting method and are subject to effectiveness assessment pursuant to the Accounting and Auditing Treatment Regarding the Application of Accounting Standards for Financial Products in the Insurance Industry as set out in the Board of Auditors Report by Industry: No. 26 (Japanese Institute of Certified Public Accountants, September 3, 2002). The assessment of the effectiveness of the hedges is carried out by examining the state of interest rates that affect the calculation of the theoretical price of both the hedged items and the hedging instrument.

(3) Risk management systems related to financial instruments

The Group has set limits on authority with respect to overall trading as well as standards on risk management. It conducts all investment and asset management transactions within these constraints while Mitsui Sumitomo Insurance Co., Ltd. and Mitsui Sumitomo Kirameki Life Insurance Co., Ltd. systematically check the daily activities, ensuring separation of duties by keeping back-office administration separate from risk management. It also monitors activities to ensure that operations, types of products, holding limits, risk amounts, and the handling of losses, etc. are done in accordance with regulations. Furthermore, risk management departments evaluate and analyze risks and regularly report on the status of risks to the Board of Directors and other bodies.

a. Management of market risk

b. Management of credit risk

c. Management of liquidity risk

(4) Supplementary explanation regarding the market value of financial instruments, etc.

2. Matters relating to market value of financial instruments, etc.

	Amount on
	consolidated			Market
	balance sheet			value		Difference
	(Millions of yen)			(Millions of yen)		(Millions of yen)
(i) Cash, deposits and savings		313,389			313,389		—
(ii) Call loans		33,700			33,700		—
(iii) Receivables under resale agreements		15,998			15,998		—
(iv) Monetary claims bought		108,158			108,158		—
(v) Money trust		10,592			10,592		—
(vi) Securities
Securities held to maturity		506,307			518,930		12,622
Securities earmarked for policy reserve		4,196			4,405		208
Other securities		4,809,785			4,809,785		—
(vii) Loans		749,524
Bad debt reserve (*1)		(4,014	)
		745,509			753,655		8,145
Total assets		6,547,639			6,568,616		20,976
Corporate bonds		94,969			98,150		3,180
Total debts		94,969			98,150		3,180
Derivative transactions (*2)
Hedge accounting unapplied		[6,118]			[6,118]		—
Hedge accounting applies		3,895			3,895		—
Total derivative transactions		[2,222]			[2,222]		—

(*1)		General provisions for loan losses and individual provisions for loan losses have been deducted.
(*2)		Derivative transactions posted under other assets and other liabilities are shown on a lump-sum basis. Net debts and credits produced by derivative transactions are shown in net amounts and, in the total, items that are net debts are shown in [ ].

(Note) 1. Methods used to calculate market value of financial instruments

Assets

(1) Cash and deposits

The market value of deposits is essentially the same as book value; therefore, deposits are recorded according to the book value.

(2) Call loans

The market value of call loans is essentially the same as book value; therefore, call loans are recorded according to the book value.

(3) Receivables under resale agreements

The market value of receivables under resale agreements is essentially the same as book value; therefore, the receivables are recorded according to the book value.

(4) Monetary claims

(5) Money trusts

In the case of money trusts, market value is based on prices indicated by trust banks.

(6) Marketable securities

(7) Loans

Liabilities

Corporate bonds

Market value is based on reference prices for over-the-counter bond transactions disclosed by the Japan Securities Dealers Association.

Derivative transactions

Please refer to notes on (Derivative transactions).

(Note) 2. Financial instruments for which the market value is difficult to determine are outlined below, and these are not included in “(6) Marketable securities.”

(Securities)

Previous Consolidated Fiscal Year (From April 1, 2008 through March 31, 2009)

1. Trading securities (As of March 31, 2009)

Not applicable

2. Marketable securities held to maturity (As of March 31, 2009)

	Amount on
	consolidated
	balance sheet		Market value		Difference
Type	(Yen in millions)		(Yen in millions)		(Yen in millions)
Fair values exceed amount on consolidated balance sheet
Public and corporate bonds		448,375		465,551		17,176
Foreign securities		—		—		—
Sub total		448,375		465,551		17,176
Fair values do not exceed amount on consolidated balance sheet
Public and corporate bonds		21,626		20,741		(885	)
Foreign securities		4,462		4,439		(23	)
Sub total		26,089		25,180		(908	)
Total		474,464		490,731		16,267

3. Marketable securities earmarked for policy reserve (As of March 31, 2009)

Amount on

consolidated

balance sheet

Market value

Difference

Type

(Yen in millions)

Fair values exceed amount on consolidated balance sheet

Public and corporate bonds

4,293

4,481

188

Fair values do not exceed amount on consolidated balance sheet

Public and corporate bonds

—

Total

4,293

4,481

188

4. Other securities with market values (As of March 31, 2009)

			Amount on
			consolidated
	Acquisition cost		balance sheet		Difference
Type	(Yen in millions)		(Yen in millions)		(Yen in millions)
In case amount on consolidated balance sheet exceed acquisition cost
Public and corporate bonds		1,725,074		1,769,784		44,710
Stocks		633,913		1,152,640		518,727
Foreign securities		309,601		329,238		19,637
Others		64,798		67,309		2,510
Sub total		3,733,387		3,318,972		585,585
In case amount on consolidated balance sheet do not exceed acquisition cost
Public and corporate bonds		394,541		384,278		(10,263	)
Stocks		155,071		127,571		(27,500	)
Foreign securities		715,332		644,029		(71,303	)
Others		57,393		52,352		(5,040	)
Sub total		1,322,338		1,208,231		(114,107	)
Total		4,055,725		4,527,204		471,478

(Note)	1.	Others include beneficiary claims on loan trusts represented as monetary claims bought in consolidated balance sheets.
	2.	Impairment losses of marketable securities available for sale amount to 106,810 million yen. Parent company and its domestic consolidated subsidiaries in principle recognize impairment losses on marketable securities if the fair value is declined by more than 30% of their cost or amortized cost.

5. Securities earmarked for policy reserve sold during the current fiscal year (From April 1, 2008 to March 31, 2009)

Sold amount

Gains on sale

Losses on sale

Type

(Yen in millions)

Securities earmarked for policy reserve

205

—

6. Other securities sold during the current fiscal year (From April 1, 2009 to March 31, 2010)

Sold amount

Gains on sale

Losses on sale

Type

(Yen in millions)

Other securities

635,387

76,581

17,830

7. Securities without market values and their amounts on consolidated balance sheet (As of March 31, 2009)

(1) Securities held to maturity

Foreign securities		¥	1,112 million
Other		¥	139,670 million

(Note) Others include certificate of deposit which are represented as cash deposits and savings, and commercial paper which are represented as monetary claims bought in consolidated balance sheets.

(2) Securities earmarked for policy reserve

Not applicable

(3) Other securities

Public and corporate bonds	¥	4,114 million
Stocks	¥	89,328 million
Foreign securities	¥	39,295 million
Other	¥	11,958 million

(Note) Others include beneficiary claims on loan trusts represented as monetary claims bought in consolidated balance sheets.

8. Details of fixed maturity securities by contractual maturity (As of March 31, 2009)

			Due after one year		Due after five years
	Due within one year		through five years		through ten years		Due after ten years
Type	(Yen in millions)		(Yen in millions)		(Yen in millions)		(Yen in millions)
Government bonds		15,607		281,854		130,675		591,190
Municipal bonds		16,940		39,976		6,542		77,908
Corporate bonds		123,305		614,427		464,601		269,441
Foreign securities		144,445		430,006		121,017		64,612
Others		139,670		997		—		76,706
Total		439,969		1,367,262		722,837		1,079,859

(Note) Others include certificate of deposit which are represented as cash deposits and savings, and commercial paper which are represented as monetary claims bought in consolidated balance sheets.

Current Consolidated Fiscal Year (From April 1, 2009 through March 31, 2010)

1. Trading securities (As of March 31, 2010)

Not applicable

2. Securities held to maturity (As of March 31, 2010)

	Amount on
	consolidated
	balance sheet		Market value		Difference
Type	(Yen in millions)		(Yen in millions)		(Yen in millions)
Fair values exceed amount on consolidated balance sheet
Public and corporate bonds		448,430—		462,206—		13,776—
Foreign securities		—		—		—
Sub total		448,430		462,206		13,776
Fair values do not exceed amount on consolidated balance sheet
Public and corporate bonds		57,631245		56,477245		(1,153—	)
Foreign securities		76,549		76,549		—
Sub total		134,426		133,272		(1,153	)
Total		582,857		595,479		12,622

(Note) Others include certificate of deposit which are represented as cash deposits and savings, and commercial paper which are represented as monetary claims bought in consolidated balance sheets.

3. Securities earmarked for policy reserve (As of March 31, 2010)

Amount on

consolidated

balance sheet

Market value

Difference

Type

(Yen in millions)

Fair values exceed amount on consolidated balance sheet

Public and corporate bonds

4,196

4,405

208

Fair values do not exceed amount on consolidated balance sheet

Public and corporate bonds

—

Total

4,196

4,405

208

4. Other securities (As of March 31, 2010)

			Amount on
			consolidated
	Acquisition cost		balance sheet		Difference
Type	(Yen in millions)		(Yen in millions)		(Yen in millions)
In case amount on consolidated balance sheet exceed acquisition cost
Public and corporate bonds		1,950,543		1,894,888		55,655
Stocks		1,530,878		671,579		859,299
Foreign securities		458,945		417,955		40,989
Others		78,351		71,809		6,542
Sub total		4,018,718		3,056,232		962,486
In case amount on consolidated balance sheet do not exceed acquisition cost
Public and corporate bonds		282,827		286,440		(3,613	)
Stocks		90,696		103,283		(12,587	)
Foreign securities		464,408		492,762		(28,353	)
Others		26,487		27,128		(640	)
Sub total		864,419		909,614		(45,194	)
Total		4,883,138		3,965,846		917,291

(Note)	1.	Others include beneficiary claims on loan trusts represented as monetary claims bought in consolidated balance sheets.
	2.	Securities available for sale for which no fair value is obtainable are not included in above table.

5. Securities earmarked for policy reserve sold during the current fiscal year (From April 1, 2009 to March 31, 2010)

Sold amount

Gains on sale

Losses on sale

Type

(Yen in millions)

Securities earmarked for policy reserve

104

—

6. Other securities sold during the current fiscal year (From April 1, 2009 to March 31, 2010)

	Sold amount		Gains on sale		Losses on sale
Type	(Yen in millions)		(Yen in millions)		(Yen in millions)
Public and corporate bonds		102,628		1,785		1,224
Stocks		31,362		12,925		3,377
Foreign securities		266,559		4,856		12,817
Total		400,550		19,567		17,419

7. Impairment losses of securities for the current consolidated fiscal year (From April 1, 2009 to March 31, 2010)

Impairment losses of other securities with market values amount to 6,065 million yen (public and corporate bonds: ¥0 million, stocks: ¥3,004 million, foreign securities: ¥2,553 million, others: ¥508 million) for the current consolidated fiscal year.

The company and its domestic consolidated subsidiaries in principle recognize impairment losses on marketable securities if the fair value is declined by more than 30% of their acquisition cost.

(Monetary Trusts)

Previous Consolidated Fiscal Year (From April 1, 2008 through March 31, 2009)

1. Monetary trusts held for investment purpose (As of March 31, 2009)

	Amount on consolidated balance sheet		Difference included in profit/loss
Type	(Yen in millions)		(Yen in millions)
Monetary trusts		13,727		(1,500	)

2. Monetary trusts to be held until maturity (As of March 31, 2009)

Not applicable

3. Monetary trusts not to be held until maturity or for investment purpose (As of March 31, 2009)

There are no monetary trusts that are solely for investment purpose and subject to fair value measurement capitalization. The cost of jointly managed trusts included in the consolidated balance sheets at acquisition cost is 749 million yen.

Current Consolidated Fiscal Year (From April 1, 2009 through March 31, 2010)

1. Monetary trusts held for investment purpose (As of March 31, 2010)

	Amount on consolidated balance sheet		Difference included in profit/loss
Type	(Yen in millions)		(Yen in millions)
Monetary trusts		9,092		(93	)

2. Monetary trusts to be held until maturity (As of March 31, 2010)

Not applicable

3. Monetary trusts not to be held until maturity or for investment purpose (As of March 31, 2010)

Amount on consolidated balance sheet

Acquisition cost

Difference

Type

(Yen in millions)

Monetary trusts

1,500

—

(Derivative Transactions)

Previous Consolidated Fiscal Year (From April 1, 2008 through March 31, 2009)

1. Qualitative information of derivative transactions

(1) Objectives and policies of transactions

The company uses derivative transactions primarily as a means of hedging against market risks arising from fluctuations in prices, exchange rates and interest rates affecting an asset investment as well as to adequately control the risk of variations in interest rates.

Also, in addition to the above, the company also has transaction risk in mind in making use of derivative transactions for the purpose of gaining investment earnings.

In other consolidated subsidiaries, derivative transactions are used for the purpose of hedging market risk caused by exchange rate fluctuations in investment assets.

(2) Description of transactions

The derivative transactions used by the company for risk control purposes during the consolidated fiscal year in question are forward foreign exchange transactions, currency option transactions, currency swap transactions, interest rate swap transactions, bond OTC option transactions, swaptions, stock forward transactions, individual stock option transactions and credit derivative transactions.

Additionally, the derivative transactions used for the purpose of garnering profits, include forward foreign exchange transactions, currency option transactions, interest rate futures transactions, interest rate swap transactions, interest rate cap transactions, interest rate floor transactions, swaptions, bond futures transactions, bond future option transactions, stock index futures transaction, stock index option transactions, credit derivative transactions and weather derivative transactions.

The derivative transactions used by the consolidated subsidiaries during the consolidated fiscal year in question are forward exchange transactions for hedging purposes.

(3) Description of risks associated with the transactions

Generally, derivative transactions carry risks associated with fluctuations in market prices (market risk) of the objects of the transactions or risks associated with fluctuations in events which form the basis of the derivative transactions.

Also, there are also inherent risks (credit risks) that are as with the failure to execute the agreement due to the bankruptcy of the transaction partner or other cause.

In the same manner, the derivative transactions used by the consolidated subsidiaries have inherent market risks associated with fluctuations in the prices of the objects targeted by the transactions.

Note, however, that for transactions that are intended as a hedge for risk control, the actual asset and the derivative transaction undergo inverse price fluctuations, so the market risk is reduced or offset.

Also that in order to avoid credit risk associated with the failure to execute an agreement, the majority of the derivative transaction partners of the parent company and the consolidated subsidiaries have been restricted to financial institutions with high credit ratings and the transactions have been distributed among them.

(4) System for managing transaction risk

The consolidated subsidiaries have established authority and risk-management provisions related to transactions in general, including derivative transactions and derivative transactions are conducted and managed based on these provisions.

With respect to the daily management of derivative transactions, the department carrying out the transactions and the back office/risk management department are completely separate and the business of handling the types of instruments, the limits on possession, the amount of risk, handling losses and other matters are controlled and monitored to make sure that they are being carried out based on the provisions. Also, the Risk Management Division uses the VaR (value at risk) or similar method to ascertain and analyze the risk affecting the actual assets and makes reports on the state of the risk at regular intervals to the board of directors or similar body.

2. Contract amount, fair value and unrealized gain/loss of derivative financial instrument

Contract amount of the agreements in derivative transactions is shown as the nominal agreement value or notional principal for the derivative transaction and does not indicate the market risk or credit risk associated with the derivative transactions of the amount itself.

Note that the option transactions in each of the following tables list the option fees in parentheses below the contract amount.

(1) Currency (As of March 31, 2009)

							Unrealized
	Contract amount				Market value		gains/losses
Type	(Yen in millions)		(over 1 year)		(Yen in millions)		(Yen in millions)
Transactions other than market transactions
Forward exchange
Short
USD		3,860		—		3,874		(13	)
EUR		112		—		125		(13	)
GBP		4,642		—		3,499		1,143
Long
USD		226		—		226		0
Currency options
Short
Call (USD)		107		—		11		(1	)
		10		—
Long
Call (USD)		1,060		—		14		(2	)
		17		—
Put (USD)		450		—		0		(12	)
		12		—
Put (EUR)		330		—		5		(3	)
		9		—
Total		10,789		—		7,757		1,096

(Note)	1.	Method of calculating market value
		(1)	Forward exchange
			We use the futures market.
		(2)	Currency options
			Based on option pricing models and the like.
	2.	Foreign denominated monetary credits based on “foreign denominated transactions accounting standards Derivative transactions allocated to obligations and the like as well as items to which hedge accounting is applied have been excluded from the items shown.

(2) Interest rates (As of March 31, 2009)

								Unrealized
	Contract amount				Market value			gains/losses
Type	(Yen in millions)		(over 1 year)		(Yen in millions)			(Yen in millions)
Transactions other than market transactions
Interest rate swaps
Receive fixed/pay floating		352,892		284,892		3,959			3,959
Receive floating/pay fixed		311,700		249,200		(4,376	)		(4,376	)
Interest rate options
Swaption
Short
Call		97,000		—		369			(208	)
		160		—
Put		70,500		4,500		65			147
		212		26
Long
Call		107,000		—		509			291
		217		—
Put		63,000		1,000		54			(189	)
		243		26
Cap
Long		900		900		0			(12	)
		13		13
Floor
Long		900		900		17			4
		13		13
Total		1,003,892		541,392		599			(384	)

(Note)	1.	Method of calculating market value
		(1)	Interest rate swaps
			Calculated by dividing the future cash flow, which is predicted using the interest rates as of the end of the term, into the current price.
		(2)	Interest rate options
			Based on an options pricing calculation model.
	2.	Items to which hedge accounting methods have been applied are excluded from or being listed.

(3) Stocks (As of March 31, 2009)

							Unrealized
	Contract amount				Market value		gains/losses
Type	(Yen in millions)		(over 1 year)		(Yen in millions)		(Yen in millions)
Market transactions
Options on stock price index
Long
Call		1,200		—		25		23
		2		—
Total		1,200		—		25		23

(Note) Method of calculating market value Based on the final price at the principal stock exchange.

(4) Bonds (As of March 31, 2009)

							Unrealized
	Contract amount				Market value		gains/losses
Type	(Yen in millions)		(over 1 year)		(Yen in millions)		(Yen in millions)
Market transactions
Bond futures
Long		969		—		967		(1	)
Bond futures options
Short
Call		2,800		—		2		14
		17		—
Long
Call		2,810		—		1		(11	)
		13		—
Put		2,760		—		11		2
		8		—
Total		9,339		—		983		4

(Note) Method of calculating market value Based on the final price at the principal stock exchange.

(5) Credit (As of March 31, 2009)

								Unrealized
	Contract amount				Market value			gains/losses
Type	(Yen in millions)		(over 1 year)		(Yen in millions)			(Yen in millions)
Transactions other than market transactions
Credit derivatives
Short		548,241		505,047		(32,060	)		(32,060	)
Total		548,241		505,047		(32,060	)		(32,060	)

(Note)	1.	Method of calculating market value
		Calculated based on such constituent elements as price, agreement period, etc. of the object of the transaction. Additionally, some are based on the price indicated by the financial institution that is the transaction partner.
	2.	“Short” is risk-assuming transaction.

(6) Others (As of March 31, 2009)

								Unrealized
	Contract amount				Market value			gains/losses
Type	(Yen in millions)		(over 1 year)		(Yen in millions)			(Yen in millions)
Transactions other than market transactions
Weather derivatives
Short		1,156		—		(22	)		(31	)
		7		—
Long		1,146		—		43			37
		5		—
Natural disaster derivatives
Short		9,022		797		127			80
		207		30
Long		8,344		1,469		77			(48	)
		126		25
Other
Short		9,848		9,018		(3,911	)		(3,897	)
		14		—
Long		10,822		10,000		3,911			3,898
		13		—
Comprehensive risk-assuming transaction		—		—		86			86
Total		40,340		21,285		311			124

(Note) Method of calculating market value Based on an option pricing model or similar method. Note also that the comprehensive risk-assuming agreements are calculated using the numerical value indicated by the transaction partner as the basis.

Current Consolidated Fiscal Year (From April 1, 2009 through March 31, 2010)

1. Derivative transactions to which hedge accounting is unapplied

(1) Currency (As of March 31, 2010)

					Market
					value			Unrealized
	Contract amount				(Yen in			gains/losses
Type	(Yen in millions)		(over 1 year)		millions)			(Yen in millions)
Transactions other than market transactions
Forward exchange
Short		7,307		—		135			135
Long		1,120		—		19			19
Currency options
Short		140		—		(18	)		(3	)
Long		525		—		0			(5	)
Total		—		—		136			146

(Note)	1.	Method of calculating market value
		(1)	Forward exchange
			We use the futures market.
		(2)	Currency options
			Based on option pricing models and the like.
	2.	Method of calculating market value for forward exchanges are changed from method based on futures market to method based on deemed profit/loss.

(2) Interest rates (As of March 31, 2010)

					Market			Unrealized
					value			gains/losses
	Contract amount				(Yen in			(Yen in
Type	(Yen in millions)		(over 1 year)		millions)			millions)
Transactions other than market transactions
Interest rate swaps
Receive fixed/pay floating		584,342		306,092		5,118			5,118
Receive floating/pay fixed		602,700		283,600		(4,636	)		(4,636	)
Interest rate options
Swaption
Short		53,000		1,000		(294	)		(37	)
Long		101,133		6,133		500			81
Cap
Long		900		900		0			(13	)
Floor
Long		900		900		17			4
Total		—		—		705			516

(Note) Method of calculating market value

(1) Interest rate swaps

Calculated by dividing the future cash flow, which is predicted using the interest rates as of the end of the term, into the current price.

(2) Interest rate options

Based on an options pricing calculation model.

(3) Credit (As of March 31, 2010)

					Market			Unrealized
					value			gains/losses
	Contract amount				(Yen in			(Yen in
Type	(Yen in millions)		(over 1 year)		millions)			millions)
Transactions other than market transactions
Credit derivatives
Short		492,003		340,049		(7,397	)		(7,397	)
Total		—		—		(7,397	)		(7,397	)

(Note)	1.	Method of calculating market value
		Calculated based on such constituent elements as price, agreement period, etc. of the object of the transaction. Additionally, some are based on the price indicated by the financial institution that is the transaction partner.
	2.	“Short” is risk-assuming transaction.

(4) Others (As of March 31, 2010)

					Market			Unrealized
					value			gains/losses
	Contract amount				(Yen in			(Yen in
Type	(Yen in millions)		(over 1 year)		millions)			millions)
Transactions other than market transactions
Weather derivatives
Short		1,042		—		(5	)		0
Long		1,042		—		5			0
Natural disaster derivatives
Short		9,904		924		(120	)		74
Long		9,017		1,385		69			(49	)
Other
Short		8,294		6,937		(29	)		(29	)
Long		9,282		7,922		29			29
Comprehensive risk-assuming transaction		—		—		488			488
Total		—		—		437			514

2. Derivative transactions to which hedge accounting is applied

(1) Currency (As of March 31, 2010)

Method of hedge

Major object of

Contract amount

Market value

accounting

Type

hedge transaction

(Yen in millions)

(over 1 year)

(Yen in millions)

Designation of forward exchange, etc.

Forward exchange

Short

Foreign currency fixed deposits

56,841

—

Market value hedge

Forward exchange Short

Other securities

3,611

—

(114

)

Deferral hedge

Currency swaps

Other securities

8,642

2,148

675

Total

—

560

(Note)	1.	Method of calculating market value
		(1)	Forward foreign exchange
			We use the futures market.
		(2)	Currency swaps
			Based on option pricing models and the like.
	2.	Designation of forward exchange, etc. is processed together with foreign currency fixed deposits which is object of hedge transaction.

(2) Interest rates (As of March 31, 2010)

Method of hedge

Major object of

Contract amount

Market value

accounting

Type

hedge transaction

(Yen in millions)

(over 1 year)

(Yen in millions)

Deferral hedge

Currency swapsReceive fixed/pay floating

Loans

6,365

5,365

111

Currency swaps Receive fixed/pay floating

Debts concerning insurance contracts

250,770

3,223

Total

—

3,335

(Note) Method of calculating market value Calculated by dividing the future cash flow, which is predicted using the interest rates as of the end of the term, into the current price.

(Pension and Retirement Benefits)

1. Summary of pension and retirement benefit plans

Some of the consolidated companies including Mitsui Sumitomo Insurance Co., Ltd. have established a lump-sump retirement plan. In addition to this, Mitsui Sumitomo Insurance Co., Ltd. has employees’ pension fund plan as defined payment plan and Mitsui Sumitomo Insurance Co., Ltd. and other domestic consolidated insurance subsidiaries a defined contribution pension plan as defined contribution plan.

Some of the overseas consolidated subsidiaries have retirement benefit plans as defined payment plan or defined contribution plan.

1. Summary of pension and retirement benefit plans

See at left.

2. Details of retirement benefit obligation (as of March 31, 2009)

	(Yen in millions)
a. Projected retirement benefit obligation		(264,415	)
b. Plan assets		138,674
c. Unfunded obligation (a + b)		(125,741	)
d. Unrecognized actuarial losses		44,782
e. Unrecognized prior service costs		—
f. Net amount in consolidated balance sheet (c + d + e)		(80,958	)
g. Prepaid pension costs		—
h. Reserve for pension and retirement benefits (f - g)		(80,958	)

(Note)

Some of the consolidated subsidiaries adopt the simple method in the calculation of pension and retirement benefit obligations.

2. Details of retirement benefit obligation (as of March 31, 2010)

	(Yen in millions)
a. Projected retirement benefit obligation		(269,473	)
b. Plan assets		153,654
c. Unfunded obligation (a + b)		(115,818	)
d. Unrecognized actuarial losses		33,394
e. Unrecognized prior service costs		—
f. Net amount in consolidated balance sheet (c + d + e)		(82,424	)
g. Prepaid pension costs		—
h. Reserve for pension and retirement benefits (f - g)		(82,424	)

(Note)

See at left.

3. Items related to pension and retirement benefit costs (From April 1 2008 through March 31, 2009)

	(Yen in millions)
a. Service costs		10,391
b. Interest costs		5,220
c. Expected return on plan assets		(4,667	)
d. Amortization of actuarial losses		3,375
e. Amortization of prior service costs		—
f. Pension and retirement benefit costs (a + b + c + d + e)		14,320
g. Other		2,458
Total		16,779

(Note)

1.		The pension and retirement benefit costs of the consolidated subsidiaries using the simple method are shown in “a. Service costs.”
2.		The category “g. Other” is the amount of contributions paid to defined contribution plan.

3. Items related to pension and retirement benefit costs (From April 1 2009 through March 31, 2010)

	(Yen in millions)
a. Service costs		10,824
b. Interest costs		5,297
c. Expected return on plan assets		(4,153	)
d. Amortization of actuarial losses		5,666
e. Amortization of prior service costs		—
f. Pension and retirement benefit costs (a + b + c + d + e)		17,634
g. Other		2,424
Total		20,059

(Note)

See at left.

4. Actuarial assumption for calculation of retirement benefit obligation etc.

a. Attribution method of retirement benefits over service period		The benefit/years of service method
b. Discount rate		Mostly 2.00%
c. Expected rate of return on plan assets		Mostly 3.00%
e. Amortization period for actuarial gains and losses
Defined benefit pension plan and termination allowance plan		4 years
Former a tax qualified defined benefit pension plan		Mostly 10 years

(Expenses are accounted for in the following fiscal year using the straight-line method over a certain number of years and within the average remaining work period of employees at the time of occurrence.)

4. Actuarial assumption for calculation of retirement benefit obligation etc.

See at left.

(Pre-share Information)

Previous Consolidated Fiscal Year		Current Consolidated Fiscal Year
(From April 1, 2008 through March 31, 2009)		(From April 1, 2009 to March 31, 2010)
Net assets less minority interests per share	2,411.70	Net assets less minority interests per share	3,143.32
Net income per share	19.45	Net income per share	89.84

(Note)	1.	With respect to the net income per share this term after adjusting for potential share dilution, there is not potential share dilution, so no figure is shown.
	2.	The basis for calculating the net income per share this term is as follows below.

	Previous Consolidated Fiscal Year		Current Consolidated Fiscal Year
	(From April 1, 2008 through		(From April 1, 2009 to
	March 31, 2009)		March 31, 2010)
Net income (yen in millions)		8,192		37,640
Net income associated with common stock (yen in millions)		8,192		37,640
Average number of shares of common stock during this term (thousand shares)		421,051		418,960

3. The basis for calculating the net assets less minority interests per share is as follows below.

	As of March 31, 2009		As of March 31, 2010
Net assets (yen in millions)		1,023,021		1,311,082
Amount deducted form net assets (yen in millions)		11,794		6,750
Minority interests (yen in millions)		11,794		6,750
Net assets associated with common stock		1,011,226		1,304,332
Number of shares of common stock used to calculate the net assets per share (thousand shares)		419,300		414,953

(Significant Subsequent Events)

1. Business Integration

The Company entered into share exchange agreements, on September 30, 2009, with Aioi and NDGI pursuant to which the Company would become a wholly owning parent company, and consummated the share exchanges, on April 1, 2010, with each of Aioi and NDGI pursuant to the agreements, which had been approved at the extraordinary shareholders’ meeting held on December 22, 2009. Also on April 1, 2010, the Company changed its corporate name to MS&AD Insurance Group Holdings, Inc.

(i) Name and business of acquired business

Name of the acquired businesses: Aioi and NDGI

(ii) Major reason for business combination

(iii) Date of business combination

April 1, 2010

(iv) Legal structure of business combination

Share exchanges in which the Company has become a wholly owning parent company

(v) Name of business after combination

MS&AD Insurance Group Holdings, Inc.

(vi) Ratio of voting rights acquired

100%

(vii) Main reason to decide the acquiring company

(2) Acquisition cost of business acquired and its breakdown

	(Millions of yen)
	Aioi		NDGI
Consideration for acquisition		361,948		188,116
Direct expenditure for acquisition		171		88
Acquired cost		362,119		188,205

(3) Exchange ratio of shares by class, method of evaluation and number of shares delivered

(i) Exchange ratio of shares by class

0.190 ordinary share of the Company was allotted for 1 ordinary share of Aioi and 0.191 ordinary share of the Company was allotted for 1 ordinary share of NDGI

(ii) Method of evaluation

In order to support their respective efforts to ensure the fairness and appropriateness of the share exchange ratio, Aioi requested Nomura Securities Co., Ltd. and Morgan Stanley Japan Securities Co., Ltd., NDGI requested Goldman Sachs Japan Co., Ltd., and the Company requested Nikko Citigroup Limited (currently, Citigroup Global Markets Japan Inc.) to perform financial analyses relating to the applicable share exchange ratio under the Business Integration.

(iii) Number of shares delivered

		Aioi		NDGI
Shares delivered		139,479,256 shares		72,491,759 shares

The Company expects to recognize goodwill and negative goodwill on the consolidated financial statements in connection with the share exchanges, but their amounts are yet to be determined.

2. Merger of Subsidiaries

Subsidiaries of the Company, Mitsui Sumitomo Kirameki Life Insurance Co., Ltd. and Aioi Life Insurance Co., Ltd. entered into “Basic Agreement on Merger” as of May 20, 2010, in which the two companies agree on basic matters concerning merger of the two companies. The summary of the agreement is as follows.

(1) Purpose of the merger

The merged company is intended to enhance our operational bases in domestic life insurance business, a growing business area in the five business domains under the Group’s medium-term management plan “MS&AD New Frontier 2013,” and thus accelerate growth of the group.

(2) Schedule of Merger

Contemplated to be effective on October 1, 2011 and conditional on obtaining permissions and other approvals from relevant authorities

(Other Notes)

Notes on lease transactions, transactions with related parties and real properties for rent and other purposes are omitted due to less necessity for disclosure.

5. Non-consolidated Financial Statements

(1) Non-consolidated Balance Sheets

(Yen in millions)

	FY 2008			FY 2009
	(As of March 31, 2009)			(As of March 31, 2010)
Assets
Current assets
Cash, deposits and savings		460			153
Accounts receivable		22,064			7,500
Deposits from affiliates		1,406			87
Other		4			334
Total current assets		23,936			8,075
Fixed assets
Tangible fixed assets
Buildings		—			134
Tools, furniture and fixtures		—			35
Total tangible fixed assets		—			169
Investments and other assets
Stock of affiliates		756,614			761,714
Others		—			2
Total investments and other assets		756,614			761,717
Total fixed assets		756,614			761,887
Total assets		780,551			769,963
Liabilities
Current liabilities
Short-term loans of affiliates		15,012			—
Accounts payable		128			371
Accrued expenses		97			—
Corporate tax accrued		10			7
Consumption tax accrued		103			—
Deposits		15			10
Accrued bonuses for employees		108			157
Total current liabilities		15,476			547
Total liabilities		15,476			547
Net assets
Shareholders’ equity
Common stock		100,000			100,000
Capital surplus
Additional paid-in capital		179,191			179,191
Other capital surplus		467,210			467,210
Total capital surplus		646,401			646,401
Retained earnings
Other retained earnings
Retained earnings carried forward		23,317			37,702
Total other retained earnings		23,317			37,702
Treasury stock		(4,644	)		(14,687	)
Total shareholders’ equity		765,074			769,415
Total net assets		765,074			769,415
Total liabilities and net assets		780,551			769,963

(2) Non-consolidated Statement of Income

(Yen in millions)

	FY 2008		FY 2009
	(From April 1, 2008		(From April 1, 2009
	to March 31, 2009)		to March 31, 2010)
Operating income
Dividends paid by affiliates		35,250		37,375
Commissions earned from affiliates		2,823		2,643
Total operationg incom		38,073		40,018
Operating expenses
Sales and general administrative expenses		2,542		2,617
Total operating expenses		2,542		2,617
Operating income		35,530		37,401
Non-operating Income
Interest earned		9		4
Interest on refund		—		81
Commissions earned		9		—
Other		0		1
Total non-operating income		19		87
Non-operating Expenses
Interest paid		104		64
Organization costs		745		—
Business integration expenses		—		389
Other		7		6
Total non-operating expenses		856		461
Ordinary profit		34,693		37,027
Current net income before taxes		34,693		37,027
Corporate, residential, and business taxes		3		3
Reversal of income taxes for prior periods		—		(2	)
Total corporate, residential, and business taxes		3		1
Net income for this year		34,689		37,026

(3) Non-consolidated Statement of Changes in Net Assets

(Yen in millions)

	FY 2008			FY 2009
	(From April 1, 2008			(From April 1, 2009
	to March 31, 2009)			to March 31, 2010)
Shareholder’s equity
Common stock
Balance as of the end of previous FY		—			100,000
Change this year
Increase due to share transfer		100,000			—
Total change this year		100,000			—
Balance as of the end of current FY		100,000			100,000
Capital surplus
Legal capital surplus
Balance as of the end of previous FY		—			179,191
Change this year
Increase from share transfer		179,191			—
Total change this year		179,191			—
Balance as of the end of current FY		179,191			179,191
Other capital surplus
Balance as of the end of previous FY		—			467,210
Change this year
Increase from share transfer		467,223			—
Disposal of treasury stock		(13	)		0
Total change this year		467,210			0
Balance as of the end of current FY		467,210			467,210
Retained earnings
Other retained earnings
Retained earnings carried forward
Balance as of the end of previous FY		—			23,317
Change this year
Dividends of retained earnings		(11,371	)		(22,641	)
Net income		34,689			37,026
Total change this year		23,317			14,384
Balance as of the end of current FY		23,317			37,702
Treasury stock
Balance as of the end of previous FY		—			(4,644	)
Change this year
Acquisition of treasury stock		(4,724	)		(10,048	)
Disposal of treasury stock		80			4
Total changes this year		(4,644	)		(10,043	)
Balance as of the end of current FY		(4,644	)		(14,687	)
Total shareholder’s equity
Balance as of the end of previous FY		—			765,074
Change this year
Increase due to share transfer		746,414			—
Dividends of retained earnings		(11,371	)		(22,641	)
Net income		34,689			37,026
Acquisition of treasury stock		(4,724	)		(10,048	)
Disposal of treasury stock		66			5
Total change this year		765,074			4,341
Balance as of the end of current FY		765,074			769,415

(4) Notes on regarding Going Concern Assumptions

Not applicable.

6. Other Information

(1) Changes in Directors and Corporate Auditors

Changes in Directors and Corporate Auditors are disclosed on TDnet on February 26, 2010.

(2) Summary of Consolidated Results of Operations

(Yen in millions)

										Change
Items	FY 2008			FY 2009			Change			Ratio(%)
Ordinary Income and Expenses:
Underwriting income:		1,831,877			1,812,669			(19,208	)		(1.0	)
Net premiums written		1,445,651			1,394,164			(51,486	)		(3.6	)
Deposit premiums from policyholders		165,464			145,026			(20,438	)		(12.4	)
Life insurance premiums		133,367			135,165			1,797			1.3
Underwriting expenses:		1,569,947			1,561,117			(8,829	)		(0.6	)
Net claims paid		892,710			914,691			21,980			2.5
Loss adjustment expenses		82,270			80,547			(1,723	)		(2.1	)
Commission and collection expenses		245,696			243,136			(2,559	)		(1.0	)
Maturity refunds to policyholders		283,405			278,423			(4,981	)		(1.8	)
Life insurance claims		36,438			41,716			5,278			14.5
Investment income:		203,199			139,902			(63,297	)		(31.2	)
Interest and dividends received		169,340			143,896			(25,444	)		(15.0	)
Gains on sale of securities		76,713			19,695			(57,018	)		(74.3	)
Investment expenses:		170,096			47,021			(123,074	)		(72.4	)
Losses on sale of securities		17,830			17,419			(411	)		(2.3	)
Losses on devaluation of securities		118,122			6,065			(112,056	)		(94.9	)
Operating expenses and general and administrative expenses		302,350			294,960			(7,389	)		(2.4	)
Other ordinary income and expenses		(5,728	)		3,223			8,951			—
Net income and losses from equity method investments		(4,243	)		4,878			9,121			—
Ordinary profit (loss)		(13,044	)		52,695			65,740			—
Extraordinary Income and Losses:
Extraordinary income		27,136			3,592			(23,544	)		(86.8	)
Extraordinary losses		3,666			6,048			2,382			65.0
Extraordinary income and losses		23,470			(2,456	)		(25,926	)		(110.5	)
Income before income taxes		10,425			50,238			39,813			381.9
Income taxes — current		34,333			18,778			(15,554	)		(45.3	)
Refund of income taxes for prior periods		(7,307	)		(13,950	)		(6,642	)		—
Income taxes — deferred		(25,161	)		7,330			32,492			—
Total income taxes		1,864			12,158			10,294			552.3
Minority interests		369			439			70			19.1
Net income		8,192			37,640			29,448			359.5
<Excluding the Good Result Return (GRR) premiums of the automobile insurance “ModoRich.”>
Net premiums written		1,451,033			1,394,900			(56,133	)		(3.9	)

(3) Direct Premiums Written by Lines of Insurance(including Deposit premiums from policyholders)

(Yen in millions)

	Year ended March 31, 2009							Year ended March 31, 2010
			Share		Change					Share		Change
Lines of Insurance	Amount		%		%			Amount		%		%
Fire and Allied		314,513		18.5		(1.1	)		309,649		18.9		(1.5	)
Marine		110,565		6.5		(9.3	)		91,816		5.6		(17.0	)
Personal Accident		263,396		15.5		(11.7	)		246,694		15.1		(6.3	)
Voluntary Automobile		615,451		36.2		(3.1	)		615,907		37.6		0.1
Compulsory Automobile Liability		137,598		8.1		(17.0	)		129,284		7.9		(6.0	)
Other		258,712		15.2		(10.0	)		243,482		14.9		(5.9	)
Total		1,700,238		100.0		(6.9	)		1,636,834		100.0		(3.7	)
Deposit premiums from policyholders		165,464		9.7		(16.1	)		145,026		8.9		(12.4	)
<Excluding the GRR premiums of the automobile insurance “ModoRich.”>
Voluntary Automobile		620,833				(1.5	)		616,643				(0.7	)
Total		1,705,620				(6.4	)		1,637,570				(4.0	)

Net Premiums by Lines of Insurance

(Yen in millions)

	Year ended March 31, 2009							Year ended March 31, 2010
			Share		Change					Share		Change
Lines of Insurance	Amount		%		%			Amount		%		%
Fire and Allied		220,095		15.2		(2.2	)		218,268		15.7		(0.8	)
Marine		93,680		6.5		(10.0	)		75,936		5.4		(18.9	)
Personal Accident		135,937		9.4		(1.6	)		135,128		9.7		(0.6	)
Voluntary Automobile		608,613		42.1		(2.6	)		610,955		43.8		0.4
Compulsory Automobile Liability		148,501		10.3		(22.4	)		134,931		9.7		(9.1	)
Other		238,822		16.5		(7.2	)		218,944		15.7		(8.3	)
Total		1,445,651		100.0		(6.2	)		1,394,164		100.0		(3.6	)
<Excluding the GRR premiums of the automobile insurance “ModoRich.”>
Voluntary Automobile		613,995				(1.0	)		611,691				(0.4	)
Total		1,451,033				(5.6	)		1,394,900				(3.9	)

Net Claims Paid by Lines of Insurance

(Yen in millions)

	Year ended March 31, 2009							Year ended March 31, 2010
			Share		Change					Share		Change
Lines of Insurance	Amount		%		%			Amount		%		%
Fire and Allied		96,269		10.8		(8.2	)		96,342		10.6		0.1
Marine		42,481		4.8		(4.3	)		40,442		4.4		(4.8	)
Personal Accident		71,916		8.0		2.4			77,046		8.4		7.1
Voluntary Automobile		393,311		44.1		0.4			395,925		43.3		0.7
Compulsory Automobile Liability		137,383		15.4		0.6			133,723		14.6		(2.7	)
Other		151,348		16.9		14.8			171,210		18.7		13.1
Total		892,710		100.0		1.5			914,691		100.0		2.5

Note

1.		Since the Company was incorporated on April 1, 2008, figures of sections of “Change” for the year ended March 31, 2009 represent comparative figures against Mitsui Sumitomo Insurance Company, Limited (Consolidated), one of consolidated subsidiaries of the Company.
2.		Any figures are amounts before the off-set of intersegment transactions.

(4) Information on Risk-Monitored Loans

(Yen in millions)

	As of March 31,			As of March 31,
	2009			2010			Change
Loans to financially impaired parties		13			1,441			1,427
Overdue loans		2,609			2,426			(182	)
Receivables in arrears for three months or more		817			855			38
Receivables to which eased loan conditions were granted		845			2,043			1,197
Total		4,285			6,766			2,481
Ratio to balance of loans		0.60	%		0.90	%		0.30	%
(Reference) Balance of loans		768,400			749,524			(18,876	)

(Note) Meanings of each loan items are as follows.

(1)		Loans to financially impaired parties
		Loans to financially impaired parties mean the loans without accrued unpaid interest (defined below), with respect to which such event as provided for in Article 96, Paragraph 1, Items 3-(a) through (e), or Item 4 of the Corporation Tax Enforcement Order (Government Ordinance No. 97, 1965) (provision limit for bad debt reserve) has occurred. The Loans without accrued unpaid interest represent those loans on which accrued interest receivable is not recognized because repayments of principal or interest were overdue for considerable periods and they are regarded as uncollectible (excluding the portion of loans that were written off) (hereinafter referred to as the “Loans without accrued unpaid interest”).
(2)		Overdue loans
		Overdue loans represent loans without accrued unpaid interest except for loans to financially impaired parties and loans that have been granted grace for interest payments for the purpose of restructuring the debtor, or supporting the debtor in financial difficulty.
(3)		Receivables in arrears for three months or more
		Receivables in arrears for three months or more mean loans receivable for which payment of principal or interest is in arrears for three months or more from the day next following the stated payment date and which do not fall under receivables from debtors who are under collapse of management or receivables in arrears.
(4)		Receivables to which eased loan conditions were granted
		Receivables to which eased loan conditions were granted mean loans receivable for which such arrangements as will be favorable to debtors including reduction or exemption of interest, postponement of interest payment or grant of grace period for the principal, abandonment of debts or others have been made, and which do not fall under receivables from debtors who are under collapse of management, receivables in delay or receivables in arrears for 3 months or more.

(Reference) Investment Conditions of Securitized Instruments and Exposure to the US Subprime Loan Losses

Managerial basis

1. Investment Conditions of Specific Securitized Instruments

There were no US subprime loan instruments in the investments / loans amount.

(Units: 100 million yen)

	As of March 31, 2009								As of March 31, 2010
	Amount of								Amount of
	investments and								investments and
	loans Note 1		Valuation			Losses on			loans Note 1		Valuation			Losses on
	(Amount in		Difference			Devaluation /			(Amount in		Difference			Devaluation /
	Consolidated		(Unrealized			Gains or losses			Consolidated		(Unrealized			Gains or losses
Category	Balance Sheet)		losses/gains)			on Sales, etc.			Balance Sheet)		losses/gains)			on Sales, etc.
(1) RMBS		1,389		(4	)		—			(Note 2) 1,311		18			—
Japan		1,355		(3	)		—			1,282		18			—
Overseas		34		(0	)		—			28		0			—
(2) ABS-CDO Note 3		0		(1	)		(0	)		2		0			—
AAA		—		—			—			—		—			—
AA		—		—			—			—		—			—
A		—		—			—			—		—			—
BBB or below		0		(1	)		(0	)		2		0			—
(3) CDO Note 3		129		(1	)		(5	)		115		2			(2	)
CLO		129		(1	)		(2	)		115		1			(2	)
AAA		129		(1	)		(2	)		115		1			(2	)
AA		—		—			—			—		—			—
A		—		—			—			—		—			—
BBB or below		—		—			—			—		—			—
CBO		0		—			(0	)		0		(0	)		—
AAA		—		—			—			—		—			—
AA		—		—			—			—		—			—
A		—		—			—			—		—			—
BBB or below		0		—			(0	)		0		(0	)		—
Synthetic CDO		0		(0	)		(2	)		0		0			(0	)
AAA		—		—			—			—		—			—
AA		—		—			—			—		—			—
A		—		—			—			—		—			—
BBB or below		0		(0	)		(2	)		0		0			(0	)
(4) CMBS		164		(8	)		—			140		(7	)		—
Japan		164		(8	)		—			140		(7	)		—
Overseas		—		—			—			—		—			—
(5) ABCP		52		—			—			16		—			—
Portion composed by Mitsui Sumitomo Insurance Group		52		—			—			16		—			—
(6) SIV instruments		—		—			—			—		—			—
Portion composed by Mitsui Sumitomo Insurance Group		—		—			—			—		—			—
(7) LBO Loan		133		(Note 4) —			(12	)		121		(Note 4) —			(0	)
Japan		133		—			(12	)		121		—			(0	)
Overseas		—		—			—			—		—			—

(Note 1)		The above investments appear in the consolidated balance sheets as monetary claims bought, investments in securities, and loans.
(Note 2)		Breakdown of credit ratings: AAA (129.0 billion yen), AA (2.0 billion yen)
(Note 3)		There are no hedge transactions for ABS-CDO and CDO instruments.
(Note 4)		Loans are recognized at the book values, so for the LBO loans the valuation differences are not shown.
(Note 5)		The figures of Mitsui Sumitomo MetLife Insurance Co., Ltd., accounted for under the equity method, are not included in the above table.

[Glossary]

t Synthetic CDO: Synthetic Collateralized Debt Obligations

t ABCP: Asset-Backed Commercial Paper

t ABS: Asset-Backed Securities

t ABS-CDO: CDOs backed by asset-backed securities

t CBO: Collateralized Bond Obligation

t CDO: Collateralized Debt Obligation

t CLO: Collateralized Loan Obligation

t CMBS: Commercial Mortgage-Backed Securities

t LBO Loan: Leveraged Buyout Loan

t RMBS: Residential Mortgage-Backed Securities

t SIV: Structured Investment Vehicle

2. Exposure to US Subprime Loans

The exposure to U.S. Subprime Loans was 0.1 billion yen as of March 31, 2010.

Breakdown of US Subprime Loans related exposure:

(Units: 100 million yen)

	As of March 31, 2009				As of March 31, 2010
	Outstanding (Notional)		Exposure to US		Outstanding (Notional)		Exposure to US
	Par Amount		Subprime Loans		Par Amount		Subprime Loans
Financial guarantee reinsurance
ABS-CDO		52		5		—		—
RMBS		6		6		1		1
Total				12				1

[Summary of Business Results for Primary Consolidated Subsidiaries]

(Reference: Mitsui Sumitomo Insurance Co., Ltd., non-consolidated)

Non-consolidated Balance Sheets

(Yen in millions)

Items	As of March 31, 2009			As of March 31, 2010
Assets
Cash, deposits and savings		243,868			183,387
Cash on hand		435			333
Deposits in banks		243,432			183,053
Call loans		31,900			33,700
Securities bought under resale agreements		—			15,998
Monetary claims bought		122,658			102,027
Money trusts		14,421			10,524
Investments in securities		4,095,321			4,327,376
Government bonds		359,394			469,539
Municipal bonds		127,410			114,421
Corporate bonds		1,131,864			1,072,879
Stocks		1,379,633			1,723,919
Foreign securities		1,037,482			900,478
Others		59,534			46,138
Loans		754,645			718,587
Policy loans		14,542			13,440
General loans		740,103			705,147
Tangible fixed assets		247,624			239,336
Land		96,642			94,567
Buildings		128,593			123,153
Construction in progress		1,356			4,410
Other tangible fixed assets		21,033			17,204
Intangible fixed assets		3,535			7,465
Software		—			3,617
Other intangible fixed assets		3,535			3,847
Other assets		330,293			337,004
Premiums receivable		2,596			3,448
Due to agents		73,073			82,707
Due to foreign agents		49			2
Co-insurance business receivable		8,754			7,898
Reinsurance business receivable		49,564			50,970
Foreign reinsurance business receivable		15,751			14,705
Agent business receivable		749			359
Other receivable		11,795			15,120
Accrued income		13,578			10,936
Deposit received		19,988			19,185
Deposits with the Japan Earthquake Reinsurance Company		72,307			76,556
Suspense payments		36,543			40,585
Initial Margins of Future Markets		0			—
Assets related to derivative transactions		24,850			13,839
Other assets		690			690
Deferred tax assets		133,081			—
Customers’ liabilities under acceptances and guarantees		5,527			4,577
Bad debts reserve		(5,531	)		(8,004	)
Total assets		5,977,347			5,971,982
Liabilities
Underwriting funds		4,508,974			4,508,974
Outstanding claims		559,493			559,493
Underwriting reserves		3,949,481			3,949,481
Bonds		164,960			164,960
Other liabilities		261,397			261,397
Co-insurance business payable		9,114
Reinsurance business payable		34,498
Foreign reinsurance business payable		14,562
Agent business payable		111
Payables under securities lending transactions		60,508
Income tax payable		23,278
Guarantee money		32,585
Advance received		103
Other payable		25,889
Suspense receipts		17,478
Liabilities related to derivative transactions		42,031			23,278
Lease obligations		1,232			1,232
Other liabilities		1			236,886
Reserve for pension and retirement benefits		79,553			79,553
Reserve for pension and retirement benefits for officers and operating officers		2,311			2,311
Accrued bonuses for employees		10,317			10,317
Reserve under special law		2,871			2,871
Reserve for price fluctuation		2,871			2,871
Deferred tax liabilities		—			—
Liabilities under acceptances and guarantees		5,527			5,527
Total liabilities		5,035,915			5,035,915
Net assets
Common stock		139,595			139,595
Capital surplus		93,107			93,107
Additional paid-in capital		93,107			93,107
Retained earnings		414,809			402,893
Legal earned reserve		46,487			46,487
Other retained earnings		368,321			356,405
Special reserve		283,400			283,400
Reserve for overseas investment loss		0			—
Reserve for advanced depreciation		7,503			8,304
Reserve for anticipated advanced depreciation		547			1,269
Retained earnings carried forward		76,871			63,430
Total shareholders’ equity		647,512			635,596
Unrealized gains on investments, net of tax		284,248			567,580
Deferred hedge gains or losses		9,671			2,138
Total valuation and translation adjustment		293,919			569,718
Total net assets		941,431			1,205,315
Total liabilities and net assets		5,977,347			5,971,982

(Reference: Mitsui Sumitomo Insurance Company, Limited)

Non-consolidated Statements of Income

(Yen in millions)

	FY 2008			FY 2009
Items	Amount			Amount
Ordinary income:		1,765,998			1,636,934
Underwriting income:		1,598,901			1,525,130
Net premiums written		1,234,011			1,203,007
Deposit premiums from policyholders		165,464			145,026
Investment income on deposit premiums from policyholders		52,862			54,064
Reversal of outstanding claims		30,489			19,304
Reversal of underwriting reserves		115,955			103,605
Other underwriting income		118			122
Investment income:		161,420			107,640
Interest and dividends received		137,877			117,477
Investment gains on money trusts		118			675
Gains on sale of securities		72,585			15,354
Gains on redemption of securities		3,448			2,352
Gains on derivative transactions		—			25,238
Other investment income		253			605
Transfer of investment income on deposit premiums from policyholders		(52,862	)		(54,064	)
Other ordinary income		5,675			4,163
Ordinary expenses:		1,740,465			1,601,148
Underwriting expenses:		1,354,265			1,333,731
Net claims paid		784,803			771,996
Loss adjustment expenses		76,143			74,487
Commission and collection expenses		207,902			207,128
Maturity refunds to policyholders		283,405			278,423
Dividends to policyholders		507			1,062
Foreign exchange losses		1,270			343
Other underwriting expenses		232			288
Investment expenses:		155,750			42,373
Investment losses on money trusts		2,661			21
Losses on sale of securities		12,343			15,128
Losses on devaluation of securities		109,537			4,877
Losses on redemption of securities		9,160			4,459
Losses on derivative transactions		774			—
Foreign exchange losses		9,505			190
Other investment expenses		11,768			17,695
Operating expenses and general and administrative expenses		225,994			218,916
Other ordinary expenses:		4,454			6,126
Interest paid		1,625			2,133
Provision for bad debts reserve		1,459			2,566
Loss on bad debts		141			17
Other ordinary expenses		1,228			1,408
Ordinary profit		25,532			35,786
Extraordinary income:		27,308			3,285
Gains on sale of fixed assets		1,361			3,103
Reversal of reserve under the special law		25,947			182
Reversal of reserve for price fluctuation		25,947			182
Extraordinary losses:		3,651			5,933
Losses on sale of fixed assets		2,608			2,502
Impairment losses on fixed assets		1,043			3,431
Income before income taxes		49,190			33,138
Income taxes — current		29,264			14,961
Refund of income taxes for prior periods		(7,307	)		(13,947	)
Income taxes — deferred		(19,347	)		6,666
Total income taxes		2,609			7,680
Net income		46,580			25,458

(Reference: Mitsui Sumitomo Insurance Co., Ltd., non-consolidated)

Status of Income/losses

(Yen in millions)

	FY 2008			FY 2009
	(From April 1, 2008			(From April 1, 2009
Categoty	to March 31, 2009)			to March 31, 2010)			Increase/Decrease			% Change
Direct premiums written including deposit premiums from policyholders		1,455,161			1,414,870			(40,291	)		(2.8	)%
Direct premiums written		1,289,697			(1,269,843	)		(19,853	)		(1.5	)
Ordinary income and losses
Underwriting income		1,598,901			1,525,130			(73,771	)		(4.6	)
Net premiums written		1,234,011			(1,203,007	)		(31,003	)		(2.5	)
Deposit premiums from policyholders		165,464			(145,026	)		(20,438	)		(12.4	)
Underwriting expenses		1,354,265			1,333,731			(20,534	)		(1.5	)
Net claims paid		784,803			(771,996	)		(12,806	)		(1.6	)
Loss adjustment expenses		76,143			(74,487	)		(1,655	)		(2.2	)
Commissions and collection expenses		207,902			(207,128	)		(774	)		(0.4	)
Maturity refunds to policyholders		283,405			(278,423	)		(4,981	)		(1.8	)
Investment income		161,420			107,640			(53,779	)		(33.3	)
Interest and dividends received		137,877			(117,477	)		(20,399	)		(14.8	)
Gains on sales of securities		72,585			(15,354	)		(57,230	)		(78.8	)
Investment expenses		155,750			42,373			(113,377	)		(72.8	)
Losses on sales of securities		12,343			(15,128	)		( 2,785	)		(22.6	)
Losses on devaluation of securities		109,537			(4,877	)		(104,659	)		(95.5	)
Operating expenses and general and administrative expenses		225,994			218,916			(7,078	)		(3.1	)
Operating and general and administrative expenses associated with underwriting		213,110			(207,829	)		(5,281	)		(2.5	)
Other ordinary income or losses		1,221			(1,963	)		(3,184	)		(260.8	)
Ordinary profit		25,532			35,786			10,253			40.2
Underwriting profit		32,477			(15,945	)		(48,422	)		(149.1	)
Extraordinary income and losses
Extraordinary income		27,308			3,285			(24,023	)		(88.0	)
Extraordinary losses		3,651			5,933			2,282			62.5
Etraordinary income or losses		23,657			(2,647	)		(26,305	)		(111.2	)
Interim net income before tax		49,190			33,138			(16,051	)		(32.6	)
Income taxes — current		29,264			14,961			(14,303	)		(48.9	)
Refund of income taxes for prior periods		(7,307	)		(13,947	)		(6,640	)		0.0
Income taxes — deferred		(19,347	)		6,666			26,014			0.0
Total income taxes		2,609			7,680			5,070			194.3
Net income		46,580			25,458			(21,122	)		(45.3	)
Ratios
Net loss ratio		69.8	%		70.4	%
Net expense ratio		34.1			34.5
Return on assets under management (income yield)		2.7			2.4
Investment yield (realized yield)		1.1			2.4
<Excluding the Good Result Return premiums of the automobile insurance “ModoRich”.>
Direct premiums written including deposit premiums from policyholders		1,460,544			1,415,606			(44,938	)		(3.1	)%
Direct premiums written		1,295,079			1,270,579			(24,500	)		(1.9	)
Net premiums written		1,239,393			1,203,743			(35,650	)		(2.9	)
Net loss ratio		69.5	%		70.3	%
Net expense ratio		34.0			34.5

(Supplementary) Total return based on market value: −12.75% for FY 2008, 10.30% for FY 2009.

(Note) 1.		Underwriting profit = Underwriting income − (Underwriting expenses + Operating and general and administrative expenses associated with underwriting) ± Other income and expenses
		Please note that other income and expenses consists of the corporate tax on compulsory auto liability insurance, etc.
2.		Net Loss ratio = (Net claims paid + Loss adjustment expenses) / Net premiums written x 100
3.		Net expense ratio = (Commissions and collection expenses + Operating and general and administrative expenses associated with underwriting) / Net premiums written x 100

(Reference: Mitsui Sumitomo Insurance Co., Ltd., non-consolidated)

Premiums and Claims Paid by Line

Original Net Premiums (Excluding Deposit Premiums from Policyholders)

	FY 2008							FY 2009
	(From April 1, 2008							(From April 1, 2009
	to March 31, 2009)							to March 31, 2010)
	Amount				% Change			Amount				% Change
Lines of insurance	(Yen in millions)		% of Total		Y/Y			(Yen in millions)		% of Total		Y/Y
Fire		216,379		16.8		0.1			219,887		17.3		1.6
Marine		77,903		6.0		(8.9	)		65,593		5.2		(15.8	)
Personal accident		134,209		10.4		(1.6	)		134,668		10.6		0.3
Voluntary automobile		536,269		41.6		(3.6	)		536,866		42.3		0.1
Compulsory automobile liability		137,598		10.7		(17.0	)		129,284		10.2		(6.0	)
Others		187,336		14.5		(2.2	)		183,544		14.4		(2.0	)
Total		1,289,697		100.0		(4.6	)		1,269,843		100.0		(1.5	)
Deposit premiums from policyholders		165,464				(16.1	)		145,026				(12.4	)
<Excluding the Good Result Return premiums of the automobile insurance “ModoRich”.>
Voluntary automobile		541,652				(1.9	)		537,601				(0.7	)
Total		1,295,079				(3.9	)		1,270,579				(1.9	)

Net Premiums Written

	FY 2008							FY 2009
	(From April 1, 2008							(From April 1, 2009
	to March 31, 2009)							to March 31, 2010)
	Amount				% Change			Amount				% Change
Lines of insurance	(Yen in millions)		% of Total		Y/Y			(Yen in millions)		% of Total		Y/Y
Fire		176,199		14.3		(0.1	)		179,426		14.9		1.8
Marine		64,189		5.2		(11.8	)		51,910		4.3		(19.1	)
Personal accident		128,947		10.5		(1.4	)		129,471		10.8		0.4
Voluntary automobile		535,745		43.4		(3.6	)		536,006		44.5		0.0
Compulsory automobile liability		148,274		12.0		(22.4	)		134,645		11.2		(9.2	)
Others		180,654		14.6		(2.1	)		171,547		14.3		(5.0	)
Total		1,234,011		100.0		(5.9	)		1,203,007		100.0		(2.5	)
<Excluding the Good Result Return premiums of the automobile insurance “ModoRich”.>
Voluntary automobile		541,127				(1.9	)		536,741				(0.8	)
Total		1,239,393				(5.2	)		1,203,743				(2.9	)

Net Claims Paid

	FY 2008							FY 2009
	(From April 1, 2008							(From April 1, 2009
	to March 31, 2009)							to March 31, 2010)
	Amount		% Change			Net loss ratio		Amount		% Change			Net loss ratio
Lines of insurance	(Yen in millions)		Y/Y			(%)		(Yen in millions)		Y/Y			(%)
Fire		70,940		(9.8	)		42.6		73,768		4.0			43.3
Marine		31,017		(10.5	)		51.5		30,236		(2.5	)		61.7
Personal accident		68,879		3.5			60.4		72,692		5.5			62.9
Voluntary automobile		352,674		(0.2	)		74.0		350,966		(0.5	)		73.5
Compulsory automobile liability		137,200		0.6			99.8		133,498		(2.7	)		107.3
Others		124,090		15.2			72.3		110,834		(10.7	)		68.2
Total		784,803		1.0			69.8		771,996		(1.6	)		70.4
<Excluding the Good Result Return premiums of the automobile insurance “ModoRich”.>
Voluntary automobile		352,674		(0.2	)		73.2		350,966		(0.5	)		73.4
Total		784,803		1.0			69.5		771,996		(1.6	)		70.3

(Note) The net loss ratio is calculated by adding the loss adjustment expenses to net claims paid.

(Reference: Mitsui Sumitomo Insurance Co., Ltd., non-consolidated)

Solvency Margin Ratio

Domestic insurance companies calculate solvency margin ratio based on Ministry of Finance Notification No. 50, dated 1996 and on Articles 86 and 87 of the Ordinance for Enforcement of the Insurance Business Law.

Insurance companies provide for reserves to cover payment of insurance claims for covered risks. However, it is essential to maintain sufficient capacity to enable payment even when risks exceeding those normally foreseen occur, such as the occurrence of a major disaster or a large decline in the price of assets held by the insurance company.

It is the solvency margin ratio ((C) in the table below) that serves as an indicator of the capacity to pay the “Total amount of risk” ((B) in the table below), which expresses risks exceeding those normally foreseen, with capital, reserves, and other funds held by the insurance company (namely, the total amount for the solvency margin ((A) in the table below). This ratio is calculated based on the Insurance Business Law and other related laws.

The solvency margin ratio is one objective measure used by administrative authorities in monitoring insurance companies.

The company is deemed to have sufficient capacity to pay insurance claims and other expenses if the ratio is 200% or higher.

(Yen in millions)

	FY 2008			FY 2009
(A) Total solvency margin		1,857,520			2,241,511
Shareholders’ equity		634,512			621,596
Reserves for price fluctuations		2,871			2,689
Contingency reserves		1,292			233
Catastrophe reserves		562,522			583,635
General bad debt reserves		1,350			1,338
Difference on valuation of other securities (before adjustment for tax credits)		400,349			799,409
Latent gains (losses) on land		83,820			72,972
Reversal of excess reserves		—			—
Debt financing, etc.		—			—
Other deductions		31,083			35,583
Other		201,886			195,220
(B) Total amount of risk		536,176			534,040
General insurance risk (R1)		77,100			73,498
Third sector insurance risk (R2)		12			23
Assumed interest rate risk (R3)		6,625			6,426
Asset investment risk (R4)		281,114			289,698
Business management risk (R5)		11,826			11,736
Major disaster risk (R6)		226,455			217,188
(C) Solvency margin ratio [(A)/{(B)×1/2}]×100		692.8	%		839.4	%

(Reference: Mitsui Direct General Insurance Co., Ltd., non-consolidated)

Non-consolidated Balance Sheets

(Yen in millions)

				As of March 31, 2009
				(Summarized balance sheet
				for the previous business
Items	As of September 30, 2009			year)
Assets
Cash deposits and savings		3,328			3,080
Deposits in banks		3,328			3,080
Investments in securities		25,866			33,467
Government bonds		16,402			17,386
Municipal bonds		6,124			7,980
Corporate bonds		3,339			8,099
Tangible fixed assets		216			153
Buildings		56			46
Other tangible fixed assets		159			106
Intangible fixed assets		2,679			2,004
Software		2,679			2,004
Other intangible fixed assets		0			0
Other assets		4,740			4,790
Premiums receivable		0			0
Other receivable		3,055			2,984
Accrued income		40			54
Deposit received		289			290
Suspense payments		1,212			1,458
Other assets		142			2
Bad debts reserve		(1	)		(1	)
Total assets		36,829			43,494
Liabilities
Underwriting funds		29,798			32,598
Outstanding claims		11,542			13,496
Underwriting reserves		18,255			19,102
Other liabilities		1,276			955
Reinsurance business payable		0			1
Income taxes payable		102			107
Other payable		1,150			826
Suspense receipts		21			20
Accrued bonuses for employees		216			215
Reserve under special law		8			13
Reserve for price fluctuation		8			13
Deferred tax liabilities		36			72
Total liabilities		31,336			33,856
Net assets
Common stock		30,000			32,600
Capital surplus		—			2,500
Retained earnings		0			2,500
Other retained earnings		(24,571	)		(25,589	)
Retained earnings carried forward		(24,571	)		(25,589	)
Total shareholders’ equity		(24,571	)		(25,589	)
Unrealized gains on investments, net of tax		5,428			9,510
		64			128
Total valuation and translation adjustment		64			128
Total net assets		5,493			9,638
Total liabilities and net assets		36,829			43,494

(Reference: Mitsui Direct General Insurance Co., Ltd.)

Non-consolidated Statements of Income

(Yen in millions)

	FY 2008			FY 2009
Items	Amount			Amount
Ordinary income:		29,844			32,630
Underwriting income:		29,657			32,417
Net premiums written		29,644			32,406
Investment income on deposit premiums from policyholders		12			11
Investment income:		184			204
Interest and dividends received		190			209
Investment gains on money trusts		—			—
Gains on sale of securities		6			6
Gains on redemption of securities		—			—
Gains on derivative transactions		—			—
Foreign exchange gains		—			—
Other investment income		—			—
Transfer of investment income on deposit premiums from policyholders		(12	)		(11	)
Other ordinary income		3			7
Ordinary expenses:		32,165			33,622
Underwriting expenses:		24,024			25,816
Net claims paid		17,334			20,582
Loss adjustment expenses		2,112			2,165
Commission and collection expenses		263			268
Provision for outstanding claims		2,977			1,953
Provision for underwriting reserves		1,336			846
Other underwriting expenses		0			0
Operating expenses and general and administrative expenses		8,114			7,785
Other ordinary expenses:		26			20
Provision for bad debts reserve		0			0
Loss on bad debts		0			—
Other ordinary expenses		25			19
Ordinary loss		2,321			992
Extraordinary income:		—			0
Gains on sale of fixed assets		—			0
Extraordinary losses:		7			10
Losses on sale of fixed assets		4			5
Impairment losses on fixed assets		—			—
Provision for reserve under the special law		3			4
Provision for price fluctuation reserve		3			4
Other extraordinary losses		—			—
Loss before income taxes		2,328			1,002
Income taxes — current		13			16
Income taxes — deferred		—			—
Total income taxes		13			16
Net loss		2,342			1,018

(Reference: Mitsui Direct General Insurance Co., Ltd., non-consolidated)

Status of Income/losses

(Yen in millions)

	FY 2008			FY 2009
	(From April 1, 2008			(From April 1, 2009
Categoty	to March 31, 2009)			to March 31, 2010)			Increase/Decrease			% Change
Direct premiums written including deposit premiums from policyholders		29,471			32,183			2,711			9.2	%
Direct premiums written		29,471			32,183			2,711			9.2
Ordinary income and loss
Underwriting income		29,657			32,417			2,760			9.3
Net premiums written		29,644			32,406			2,761			9.3
Underwriting expenses		24,024			25,816			1,792			7.5
Net claims paid		17,334			20,582			3,247			18.7
Loss adjustment expenses		2,112			2,165			53			2.5
Commissions and collection expenses		263			268			4			1.6
Investment income		184			204			20			11.2
Interest and dividends received		190			209			19			10.1
Gains on sales of securities		6			6			0			10.0
Investment expenses		—			—			—			—
Operating expenses and general and administrative expenses		8,114			7,785			(329	)		(4.1	)
Operating and general and administrative expenses associated with underwriting		8,104			7,778			(325	)		(4.0	)
Other ordinary income		(23	)		(12	)		10			—
Ordinary profit		(2,321	)		(992	)		1,328			—
Underwriting profit		(2,471	)		(1,177	)		1,294			—
Extraordinary income and losses
Extraordinary income		—			0			0			—
Extraordinary losses		7			10			2			34.6
Etraordinary income or losses		(7	)		(9	)		(2	)		—
Interim net income before tax or interim net losses before tax		(2,328	)		(1,002	)		1,326			—
Income taxes — current		13			16			2			19.0
Total income taxes		13			16			2			19.0
Net income or losses		(2,342	)		(1,018	)		1,323			—
Ratios
Net loss ratio		65.6	%		70.2	%
Net expense ratio		28.2			24.8
Return on assets under management (income yield)		0.68			0.68

(Note) 1.		Underwriting profit = Underwriting income - (Underwriting expenses + Operating and general and administrative expenses associated with underwriting) ± Other income and expenses Please note that other income and expenses consists of the corporate tax on compulsory auto liability insurance, etc.
2.		Net loss ratio = (Net claims paid + Loss adjustment expenses) / Net premiums written x 100
3.		Net expense ratio = (Commissions and collection expenses + Operating and general and administrative expenses associated with underwriting) / Net premiums written x 100

(Reference: Mitsui Direct General Insurance Co., Ltd., non-consolidated)

Premiums and Claims by Line

Direct Premiums Written (Excluding Deposit Premiums from Policyholders)

	FY 2008						FY 2009
	(From April 1, 2008						(From April 1, 2009
	to March 31, 2009)						to March 31, 2010)
	Amount				% Change		Amount				% Change
Lines of Insurance	(Yen in millions)		% of Total		Y/Y		(Yen in millions)		% of Total		Y/Y
Fire		—		—		—		—		—		—
Marine		—		—		—		—		—		—
Personal accident		83		0.3		124.2		128		0.4		53.6
Voluntary automobile		29,388		99.7		12.2		32,054		99.6		9.1
Compulsory automobile liability		—		—		—		—		—		—
Others		—		—		—		—		—		—
Total		29,471		100.0		12.3		32,183		100.0		9.2
Deposit premiums from policyholders		—				—		—				—

Net Premiums Written

	FY 2008						FY 2009
	(From April 1, 2008						(From April 1, 2009
	to March 31, 2009)						to March 31, 2010)
	Amount				% Change		Amount				% Change
Lines of Insurance	(Yen in millions)		% of Total		Y/Y		(Yen in millions)		% of Total		Y/Y
Fire		—		—		—		—		—		—
Marine		—		—		—		—		—		—
Personal accident		83		0.3		124.2		128		0.4		53.6
Voluntary automobile		29,334		98.9		12.1		31,991		98.7		9.1
Compulsory automobile liability		226		0.8	D	10.7		286		0.9		26.1
Others		—		—		—		—		—		—
Total		29,644		100.0		12.1		32,406		100.0		9.3

Net Claims Paid

	FY 2008						FY 2009
	(From April 1, 2008						(From April 1, 2009
	to March 31, 2009)						to March 31, 2010)
	Amount		% Change		Net loss ratio		Amount		% Change		Net loss ratio
Lines of Insurance	(Yen in millions)		Y/Y		(%)		(Yen in millions)		Y/Y		(%)
Fire		—		—		—		—		—		—
Marine		—		—		—		—		—		—
Personal accident		30		100.3		48.9		43		43.6		44.1
Voluntary automobile		17,121		16.5		65.5		20,313		18.6		70.2
Compulsory automobile liability		182		17.3		80.5		224		23.2		78.6
Others		—		—		—		—		—		—
Total		17,334		16.6		65.6		20,582		18.7		70.2

(Note) The net loss ratio is calculated by adding the loss adjustment expenses to net claims paid.

(Reference: Mitsui Direct General Insurance Co., Ltd., non-consolidated)

Solvency Margin Ratio

(Yen in millions)

	FY 2008			FY 2009
(A) Total solvency margin		6,473			10,738
Shareholders’ equity		5,428			9,510
Reserves for price fluctuations		8			13
Contingency reserves		0			0
Catastrophic loss reserves		944			1,033
General bad debt reserves		0			0
Difference on valuation of other securities (before adjustment for tax credits)		91			180
Latent losses (gains) on land		—			—
Reversal of excess reserves		—			—
Debt financing, etc.		—			—
Other deductions		—			—
Other		—			—
(B) Total amount of risk		2,771			3,206
General insurance risk (R1)		2,380			2,798
Third sector insurance risk (R2)		—			—
Assumed interest rate risk (R3)		1			0
Asset investment risk (R4)		162			219
Business management risk (R5)		85			99
Major disaster risk (R6)		300			300
(C) Solvency margin ratio [(A)/{(B)×1/2}]×100		467.0	%		669.8	%

(Reference: Mitsui Sumitomo Kirameki Life Insurance Company, Limited, non-consolidated)

Non-consolidated Balance Sheets

(Yen in millions)

Items	As of March 31, 2009			As of March 31, 2010
Assets
Cash deposits and savings		12,771			13,056
Cash on hand		0			0
Deposits in banks		12,771			13,056
Investments in securities		1,013,709			1,083,096
Government bonds		(643,530	)		(680,624	)
Municipal bonds		(7,832	)		(13,236	)
Corporate bonds		(335,822	)		(359,864	)
Stocks		(299	)		(344	)
Foreign securities		(26,224	)		(29,026	)
Loans		28,712			30,899
Policy loans		28,712			30,899
Tangible fixed assets		741			1,413
Buildings		168			149
Lease assets		48			552
Other tangible fixed assets		524			710
Intangible fixed assets		0			1,480
Software		0			1,434
Other intangible fixed assets		0			45
Agencies receivable		48			62
Reinsurance receivable		122			112
Other assets		17,691			17,962
Other receivable		13,063			13,188
Prepaid expenses		327			367
Accrued income		3,224			3,293
Deposits received		988			1,012
Suspense payments		63			76
Other assets		24			24
Deferred tax assets		1,428			344
Bad debts reserve		(100	)		(86	)
Total assets		1,075,126			1,148,341
Liabilities
Underwriting funds		1,011,036			1,082,224
Outstanding claims		10,975			11,642
Underwriting reserve		998,145			1,068,346
Reserve for dividends to policyholders		1,915			2,235
Agencies payable		1,794			1,869
Reinsurance payable		128			131
Other liabilities		4,302			4,213
Income tax payable		349			26
Other payable		134			136
Accrued expenses		2,762			2,854
Advance received		0			0
Guarantee money		33			41
Lease obligations		51			587
Other liabilities		969			567
Reserve for pension and retirement benefits		341			475
Reserve for pension and retirement benefits for officers and operating officers		98			88
Reserve under the special law		1,360			1,600
Reserve for price fluctuation		1,360			1,600
Total liabilities		1,019,062			1,090,603
Net assets
Common stock		35,500			35,500
Capital surplus		13,214			13,214
Additional paid-in capital		13,214			13,214
Retained earnings		333			371
Other retained earnings		333			371
Retained earnings carried forward		333			371
Total shareholders’ equity		49,048			49,086
Unrealized gains on investments, net of tax		7,015			8,651
Total valuation and translation adjustments		7,015			8,651
Total net assets		56,064			57,738
Total liabilities and net assets		1,075,126			1,148,341

(Reference: Mitsui Sumitomo Kirameki Life Insurance Company, Limited)

Non-consolidated Statements of Income

(Yen in millions)

Items	FY 2008			FY 2009
	Amount			Amount
Ordinary income:		241,057			244,512
Insurance premiums and other:		220,889			223,662
Insurance premiums		220,167			223,365
Reinsurance income		722			297
Investment income:		19,559			20,363
Interest and dividends received		18,396			19,820
Interest and dividends on securities		17,562			18,924
Interest on loans		804			882
Other interest and dividends		29			13
Gains on sale of securities		1,162			542
Other ordinary income		609			486
Receipts of annuities with special conditions		439			349
Receipts of deferred insurance claims		150			107
Other		19			30
Ordinary expenses:		238,732			241,802
Insurance claims and other:		123,959			130,214
Insurance claims		29,860			32,633
Annuity payments		1,882			3,191
Benefits		5,417			6,188
Surrender benefits		85,349			86,677
Other refunds		815			957
Reinsurance premiums		634			565
Provision for underwriting reserves and other:		76,347			70,867
Provision for outstanding claims		749			666
Provision for underwriting reserves		75,597			70,201
Provision of interest portion of reserves for dividends to policyholders		0			0
Investment expenses:		425			442
Interest paid		3			14
Losses on sale of securities		415			426
Foreign exchange losses		6			1
Provision for bad debts reserve		0			—
Operating expenses:		35,373			37,378
Other ordinary expenses:		2,626			2,899
Payments of deferred insurance claims		116			19
Taxes		2,148			2,182
Depreciation		264			556
Provision for retirement benefits		94			133
Other		2			7
Ordinary profit		2,325			2,710
Extraordinary income:		—			9
Gains on sale of fixed assets		—			0
Reversal of bad debts reserve		—			9
Extraordinary losses:		227			250
Losses on sale of fixed assets		5			11
Provision for reserve under the special law		222			239
Provision for price fluctuation reserve		222			239
Provision for reserve for dividends to policyholders		1,775			2,148
Income before income taxes		321			321
Income taxes — current		623			125
Income taxes — deferred		(346	)		158
Total income taxes		276			283
Net income		44			37

(Reference: Mitsui Sumitomo Kirameki Life Insurance Company, Limited, non-consolidated)

Major Business Results

Policies In-force and New Policies

(1) Policies in Force

	As of March 31, 2009				As of March 31, 2010
	Policies (thousand)		Amount (Yen in millions)		Policies (thousand)		Amount (Yen in millions)
Individual insurance		1,010		8,715,563		1,131		9,129,287
Individual annuities		65		315,285		67		315,415
Group insurance		—		2,591,340		—		2,699,819
Group annuities		—		—		—		—

(Note) The amount for individual annuities consists of the sum of the pension funds available when pension payments commence and discretionary reserves on policies after pension payments have commenced.

(2) New Policies

	FY 2008								FY 2009
	(From April 1, 2008 to to March 31, 2009)								(From April 1, 2009 to March 31, 2010)
			Amount		New policies		Net increase due				Amount		New policies		Net increase due
	Policies		(Yen in		(Yen in		to conversion		Policies		(Yen in		(Yen in		to conversion
	(thousand)		millions)		millions)		(Yen in millions)		(thousand)		millions)		millions)		(Yen in millions)
Individual insurance		177		1,620,416		1,620,416		—		212		1,553,143		1,553,143		—
Individual annuities		4		33,489		33,489		—		5		34,097		34,097		—
Group insurance		—		32,441		32,441		—		—		26,198		26,198		—
Group annuities		—		—		—		—		—		—		—		—

(Note) The amount for new individual annuities is the pension funds available when pension payments commence.

Annualized Premiums

(1) Policies in Force

(Yen in millions)

	As of March 31, 2009		As of March 31, 2010
Individual insurance		175,516		175,780
Individual annuities		18,806		18,800
Total		194,322		194,580
Medical care insurance and accelerated death benefits		28,862		(33,795	)

(2) New Policies

(Yen in millions)

	FY 2008		FY 2009
	(From April 1, 2008		(From April 1, 2009
	to March 31, 2009)		to March 31, 2010)
Individual insurance		24,257		25,598
Individual annuities		1,805		1,951
Total		26,062		27,549
Medical care insurance and accelerated death benefits		6,064		7,613

(Note) 1.		Annualized premiums are the amount calculated for each year of premiums by multiplying a single premium payment by the number of premium payments designated (this would be the premium divided by the term of the insurance for policies with lump sum payments).
2.		The row listing “Medical care insurance and accelerated death benefits” includes annualized insurance premiums falling under the following categories: insurance benefits for medical care (hospitalization benefits, surgical benefits, etc.), accelerated death benefits (benefits for designated illnesses, nursing care benefits, etc.), and exemption from payment of premiums (excludes reasons due to disability and includes reasons due to contracting designated illnesses, nursing care, etc.).

(Reference: Mitsui Sumitomo Kirameki Life Insurance Company, Limited, non-consolidated)

Primary Income and Expenditure Items

(Yen in millions)

	FY 2008		FY 2009
	(From April 1, 2008		(From April 1, 2009
	to March 31, 200)		to September 31, 2010)		Increase/Decrease
Premium income		220,889		223,662		2,773
Investment income		19,559		20,363		804
Insurance claims paid		123,959		130,214		6,254
Investment expenses		425		442		16
Ordinary profit		2,325		2,710		385
Provision for reserve for dividends to policyholders		1,775		2,148		372
Net profit		44		37		(6	)

Total Assets

(Yen in millions)

		As of March 31, 2009				As of March 31, 2010
Total assets			1,075,126				1,088,370

Solvency Margin Ratio

(Yen in millions)

	As of March 31, 2009			As of March 31, 2010
(A) Total solvency margin		114,070			124,409
Shareholders’ equity		49,048			49,086
Reserves for price fluctuations		1,360			1,600
Contingency reserves		9,219			9,870
General bad debt reserves		21			14
Difference on valuation of other securities x 90%		9,889			12,195
Latent gains (losses) on land x 85%		—			—
Excess amount of Zillmerized reserve		43,409			50,246
Brought in capital, etc.		—			—
Debt financing, etc.		—			—
Other deductions		—			—
Other		1,121			1,396
(B) Total amount of risk		11,025			11,682
General insurance risk (R1)		6,288			6,604
Third sector insurance risk (R8)		1,564			1,814
Assumed interest rate risk (R2)		656			666
Asset investment risk (R3)		6,644			6,962
Business management risk (R4)		303			320
Minimum guarantee risk (R7)		—			—
(C) Solvency margin ratio [(A)/{(B)×1/2}]×100		2,069.1	%		2,129.7	%

(Reference: Mitsui Sumitomo MetLife Insurance Co., Ltd., non-consolidated)

Non-consolidated Balance Sheets

(Yen in millions)

Items	As of March 31, 2009			As of March 31, 2010
Assets
Cash deposits and savings		43,339			18,831
Deposits in banks		43,339			18,831
Money trusts		284,120			484,441
Investments in securities		2,087,038			2,582,629
Government bonds		931			0
Other securities		2,086,107			2,582,629
Loans		694			638
Policy loans		694			638
Tangible fixed assets		882			660
Buildings		568			443
Lease assets		195			154
Other tangible fixed assets		117			62
Intangible fixed assets		25			618
Software		0			545
Lease assets		25			72
Reinsurance receivable		720			708
Other assets		29,795			8,921
Other receivable		1,806			7,421
Prepaid expenses		122			93
Accrued income		8			5
Deposits received		1,203			843
Suspense payments		1,173			557
Deferred assets under article 113 of Insurance Business Act		25,482			0
Deferred tax assets		24,148			19,057
Total assets		2,470,766			3,116,508
Liabilities
Underwriting funds		2,424,052			3,068,340
Outstanding claims		6,605			6,913
Underwriting reserve		2,417,446			3,061,426
Agencies payable		4,288			1,611
Reinsurance payable		872			1,468
Other liabilities		14,765			9,012
Loans payable		5,000			5,000
Income tax payable		8			8
Others payable		3,410			514
Accrued expenses		2,691			1,737
Guarantee money		68			161
Lease obligations		222			232
Suspense receipts		3,364			1,358
Reserve under the special law		293			682
Reserve for price fluctuation		293			682
Total liabilities		2,444,271			3,081,115
Net assets
Common stock		41,060			41,060
Capital surplus		24,735			24,735
Additional paid-in capital		24,735			24,735
Retained earnings		(39,309	)		(30,386	)
Other retained earnings		(39,309	)		(30,386	)
Retained earnings carried forward		(39,309	)		(30,386	)
Total shareholders’ equity		26,485			35,408
Unrealized gains on investments, net of tax		9			14
Total valuation and translation adjustments		9			14
Total net assets		26,495			35,393
Total liabilities and net assets		2,470,766			3,116,508

(Reference: Mitsui Sumitomo MetLife Insurance Co., Ltd.)

Non-consolidated Statements of Income

(Yen in millions)

Items	FY 2008			FY 2009
	Amount			Amount
Ordinary income:		717,122			885,402
Insurance premiums and other:		623,327			451,168
Insurance premiums		619,261			443,615
Reinsurance income		4,065			7,553
Investment income:		162			426,465
Interest and dividends received		39			22
Interest on deposits		21			1
Interest and dividends on securities		7			4
Interest on loans		10			16
Investment gains on money trusts		—			71,131
Gains on sale of securities		—			14
Foreign exchange gains		123			990
Gains on separate accounts		—			354,306
Other ordinary income		93,633			7,768
Receipts of annuities with special conditions		7,479			7,729
Reversal of policy reserve		86,104			—
Other		49			38
Ordinary expenses:		730,775			870,857
Insurance claims and other:		120,368			164,406
Insurance claims		32,692			37,269
Annuity payments		18,999			29,771
Benefits		12,765			14,430
Surrender benefits		36,233			59,736
Other refunds		2,303			1,542
Reinsurance premiums		17,374			21,655
Provision for underwriting reserves and other:		466			644,288
Provision for outstanding claims		466			307
Provision for underwriting reserves		—			643,980
Investment expenses:		549,702			501
Interest paid		79			58
Investment losses on money trusts		21,060			—
Losses on redemption of securities		—			0
Other investment expenses		301			442
Losses on separate accounts		528,261			—
Operating expenses:		49,404			34,469
Other ordinary expenses:		10,833			27,192
Taxes		2,136			1,455
Depreciation		202			254
Amortization of deferred assets under Article 113 of Insurance Business Law		8,494			25,482
Other		—			0
Ordinary profit (loss)		(13,652	)		14,544
Extraordinary income:		40			—
Reversal of reserve under the special law		40			—
Reversal of reserve for price fluctuation		40			—
Extraordinary losses:		314			507
Losses on sale of fixed assets		314			119
Provision for reserve under the special law		—			388
Provision for price fluctuation reserve		—			388
Income (loss) before income taxes		(13,926	)		14,036
Income taxes — current		8			8
Income taxes — deferred		(5,005	)		5,105
Total income taxes		(4,996	)		5,113
Net income (loss)		(8,929	)		8,922

(Reference: Mitsui Sumitomo MetLife Insurance Co., Ltd., non-consolidated)

Major Business Results for the Current Quarter

Policies In-force and New Policies

(1) Policies in Force

	As of March 31, 2009				As of March 31, 2010
	Policies (thousand)		Amount (Yen in millions)		Policies (thousand)		Amount (Yen in millions)
Individual insurance		9		108,206		9		114,009
Individual annuities		334		2,370,558		387		3,023,577
Group insurance		—		—		—		—
Group annuities		—		—		—		—

(Note) The amount for individual annuities consists of the sum of the pension funds available when pension payments commence (the premium reserves for individual variable annuities, however) and discretionary reserves on policies after pension payments have commenced.

(2) New Policies

	FY 2008								FY 2009
	(From April 1, 2008 to December 31, 2009)								(From April 1, 2009 to March 31, 2010)
							Net increase								Net increase
							due to								due to
			Amount		New policies		conversion				Amount		New policies		conversion
	Policies		(Yen in		(Yen in		(Yen in		Policies		(Yen in		(Yen in		(Yen in
	(thousand)		millions)		millions)		millions)		(thousand)		millions)		millions)		millions)
Individual insurance		5		54,295		54,295		—		0		1,682		1,682		—
Individual annuities		71		538,640		538,640		—		62		406,436		406,436		—
Group insurance		—		—		—		—		—		—		—		—
Group annuities		—		—		—		—		—		—		—		—

(Note) The amount for new individual annuities is the pension funds available when pension payments commence (the premium reserves at the time of contact for individual variable annuities, however).

Annualized Premiums

(1) Policies in Force

(Yen in millions)

	As of March 31, 2009		As of March 31, 2010
Individual insurance		9,601		9,578
Individual annuities		526,087		522,135
Total		535,689		531,714
Medical care insurance and accelerated death benefits		82		103

(2) New Policies

(Yen in millions)

	FY 2008		FY 2009
	(From April 1, 2008		(From April 1, 2009
	to March 31, 2009)		to March 31, 2010)
Individual insurance		4,794		147
Individual annuities		296,316		231,486
Total		301,110		231,634
Medical care insurance and accelerated death benefits		4		0

(Note) 1.		Annualized premiums are the amount calculated for each year of premiums by multiplying a single premium payment by the number of premium payments designated (this would be the premium divided by the term of the insurance for policies with lump sum payments).
2.		The row listing “Medical care insurance and accelerated death benefits” includes annualized insurance premiums falling under the following categories: insurance benefits for medical care (hospitalization benefits, surgical benefits, etc.), accelerated death benefits (benefits for designated illnesses, nursing care benefits, etc.), and exemption from payment of premiums (excludes reasons due to disability and includes reasons due to contracting designated illnesses, nursing care, etc.).

(Reference: Mitsui Sumitomo MetLife Insurance Co., Ltd., non-consolidated)

Primary Income and Expenditure Items

(Yen in millions)

	FY 2008			FY 2009
	(From April 1, 2008			(From April 1, 2009
	to March 31 2009)			to March 31, 2010)		Increase/Decrease
Premium income		623,327			451,168		172,158
Investment income		162			426,465		426,302
Insurance claims paid		120,368			164,406		44,038
Investment expenses		549,702			501		549,201
Ordinary profit/losses		(13,652	)		14,544		28,196
Net profit/losses		(8,929	)		8,922		17,852

Total Assets

(Yen in millions)

	As of March 31, 2009			As of March 31, 2010
Total assets		2,470,766			3,116,508
Special account asset balance		(2,099,798	)		(2,586,618	)

(Reference: Mitsui Sumitomo MetLife Insurance Co., Ltd., non-consolidated)

Solvency Margin Ratio

(Yen in millions)

	As of March 31, 2009			As of March 31, 2010
(A) Total solvency margin		116,483			174,313
Shareholders’ equity		1,003			35,408
Reserves for price fluctuations		293			682
Contingency reserves		6,989			13,930
General bad debt reserves		—			—
Difference on valuation of other securities x 90% (or 100% if negative)		13			D23
Latent gains (losses) on land × 85% (or 100% if negative)		—			—
Excess amount of Zillmerized reserve		106,183			123,314
Debt financing, etc.		2,000			1,000
Other deductions		—			—
Other		—			—
(B) Total amount of risk		31,926			32,949
General insurance risk equivalent (R1)		47			17
Third sector insurance risk equivalent (R8)		21			20
Assumed interest rate risk equivalent (R2)		2,209			2,747
Asset investment risk equivalent (R3)		9,261			9,386
Business management risk equivalent (R4)		931			960
Minimum guarantee risk equivalent (R7)		19,522			19,854
(C) Solvency margin ratio [(A)/{(B)×1/2}]×100		729.6	%		1,058.0	%

May 20, 2010

Overview of Business Results of MS&AD Insurance Group Holdings, Inc. FY 2009

1. Summary of Consolidated Business Results for the Year Ended March 31, 2010

(Net Premiums Written, Ordinary Profit or Loss, Net Income or Loss)

(Unit: 100 million yen)

			Year ended			Year ended						Change Ratio
			March 31, 2009			March 31, 2010			Change			(%)
Net Premiums Written Note 1	(1	)		14,510			13,949			(561	)		(3.9	)
Mitsui Sumitomo Insurance	(2	)		12,393			12,037			(356	)		(2.9	)
Overseas Non-Life Insurance Subsidiaries	(3	)		1,819			1,587			(232	)		(12.8	)
Mitsui Direct General Insurance	(4	)		296			324			27			9.3
Ordinary Profit (Loss)	(5	)		(130	)		526			657			—
Mitsui Sumitomo Insurance	(6	)		255			357			102			40.2
Net Income (Loss)	(7	)		81			376			294			359.5
Mitsui Sumitomo Insurance	(8	)		465			254			(211	)		(45.3	)
Overseas Non-Life Insurance Subsidiaries	(9	)		(229	)		202			432			—
Mitsui Direct General Insurance	(10	)		(15	)		(6	)		8			—
Mitsui Sumitomo Kirameki Life Insurance	(11	)		0			0			(0	)		(15.3	)
Mitsui Sumitomo MetLife Insurance	(12	)		(44	)		44			89			—
Other	(13	)		2			5			2			102.0
Consolidation Adjustment/Holding Company	(14	)		(96	)		(123	)		(27	)		—

Note:	1.	Net premiums written exclude Good Result Return premiums of Mitsui Sumitomo Insurance’s proprietary auto insurance product “Modorich” which contains a special clause related to premium adjustment and refund at maturity.
	2.	Figures in 8 through 13 are prior to consolidation adjustments (the Company’s equity)

Breakdown of Overseas Non-Life Insurance Subsidiaries

(Unit: 100 million yen)

			Year ended			Year ended					Change Ratio
			March 31, 2009			March 31, 2010		Change			(%)
Net Premiums Written	(1	)		1,819			1,587		(232	)		(12.8	)
Asia	(2	)		707			652		(55	)		(7.8	)
Europe	(3	)		617			477		(140	)		(22.8	)
Americas	(4	)		239			249		10			4.4
Reinsurance	(5	)		255			208		(46	)		(18.4	)
Net Income (Loss)	(6	)		(229	)		202		432			—
Asia	(7	)		29			91		61			205.8
Europe	(8	)		(313	)		10		323			—
Americas	(9	)		11			19		7			68.8
Reinsurance	(10	)		41			80		39			93.9

2. Status of Mitsui Sumitomo Insurance Co., Ltd. (non-consolidated)

Figures in following charts excludes Good Result Return premiums of Mitsui Sumitomo Insurance Co., Limited’s proprietary automobile insurance product “ModoRich”, which contains a special clause related to premium adjustment and refund at maturity.

(1) Underwriting Profit/losses

(Yen in hundred millions)

			FY 2008			FY 2009			Change			Increase ratio
												%
(+) Net premiums written	(1	)		12,393			12,037			(356	)		(2.9	)
(–) Net claims paid	(2	)		7,848			7,719			(128	)		(1.6	)
(–) Loss adjustment expenses	(3	)		761			744			(16	)		(2.2	)
(–) Commission and collection expenses	(4	)		2,079			2,071			(7	)		(0.4	)
(–) Operating expenses and general and administrative expenses related to underwriting	(5	)		2,131			2,078			(52	)		(2.5	)
Underwriting balance	(6	)		(425	)		(576	)		(151	)		—
(–) Provision for outstanding claims	(7	)		(304	)		(193	)		111			—
(–) Provision for underwriting reserve	(8	)		(261	)		(307	)		(45	)		—
(–) Provision for catastrophe reserve	(9	)		(103	)		167			271			—
(+) Other	(10	)		80			84			4			5.5
Underwriting profit/losses	(11	)		324			(159	)		(484	)		(149.1	)
Ratios
Net loss ratio	(12	)		69.5	%		70.3	%		0.8	%
Net expense ratio	(13	)		34.0	%		34.5	%		0.5	%
Combined ratio	(14	)		103.5	%		104.8	%		1.3	%
Incurred loss (2)+(7)	(15	)		7,543			7,526			(16	)		(0.2	)
(Supplement: compulsory automobile liability excluded)
Net premiums written	(16	)		10,911			10,690			(220	)		(2.0	)
Ratios
Net loss ratio	(17	)		65.3	%		65.7	%		0.4	%
Net expense ratio	(18	)		35.5	%		35.8	%		0.3	%
Combined ratio	(19	)		100.8	%		101.5	%		0.7	%

(Note)	1.	Net loss ration = (Net claims paid + Loss adjustment expenses) / Net premiums written × 100
	2.	Net expense ratio = (Commission and collection expenses + Operating expenses and general and administrative expenses regarding underwriting) / Net premiums written × 100
	3.	Combined ratio = Net loss ratio + Net expense ratio

(2) Premiums

(Yen in hundred millions)

											Direct premiums written (excluding
	Net premiums written										deposit premiums from policyholders)
Period	FY 2008					FY 2009					FY 2008					FY 2009
			Increase					Increase					Increase					Increase
Line of business	Amount		ratio (%)			Amount		ratio (%)			Amount		ratio (%)			Amount		ratio (%)
			%					%					%					%
Fire		1,761		(0.1	)		1,794		1.8			2,163		0.1			2,198		1.6
Marine		641		(11.8	)		519		(19.1	)		779		(8.9	)		655		(15.8	)
Personal accident		1,289		(1.4	)		1,294		0.4			1,342		(1.6	)		1,346		0.3
Voluntary automobile		5,411		(1.9	)		5,367		(0.8	)		5,416		(1.9	)		5,376		0.7
Compulsory automobile liability		1,482		(22.4	)		1,346		(9.2	)		1,375		(17.0	)		1,292		(6.0	)
Other		1,806		(2.1	)		1,715		(5.0	)		1,873		(2.2	)		1,835		(2.0	)
Total		12,393		(5.2	)		12,037		(2.9	)		12,950		(3.9	)		12,705		(1.9	)

(3) Net Claims Paid

(Yen in hundred millions)

Period	FY 2008							FY 2009
			Increase			Net loss				Increase			Net loss		Difference
Line of business	Amount		ratio (%)			ratio (%)		Amount		ratio (%)			ratio (%)		(%)
			%			%				%			%		%
Fire		709		(9.8	)		42.6		737		4.0			43.3		0.7
Marine		310		(10.5	)		51.5		302		(2.5	)		61.7		10.2
Personal accident		688		3.5			60.4		726		5.5			62.9		2.5
Voluntary automobile		3,526		(0.2	)		73.2		3,509		(0.5	)		73.4		0.2
Compulsory automobile liability		1,372		0.6			99.8		1,334		(2.7	)		107.3		7.5
Other		1,240		15.2			72.3		1,108		(10.7	)		68.2		(4.1	)
Total		7,848		1.0			69.5		7,719		(1.6	)		70.3		0.8

(Note) Net loss ratio is calculated by adding loss adjustment expenses to net claims paid.

(Supplement) Status of Natural Disasters (Yen in hundred millions)

	FY 2008						FY 2009
	Total						Total
	incurred loss		Net claims paid		Outstanding claims		incurred loss		Net claims paid		Outstanding claims
Fire		29		26		3		117		99		17
Voluntary automobile		25		25		0		21		20		0
Other		5		3		1		17		11		6
Total		60		55		5		156		131		24

(Note) Above figures relate to natural disasters that occurred during the respective periods. Net claims paid, including those for natural disasters that occurred prior to the periods are, ¥73 hundred million (Fire: ¥38 hundred million, Automobile: ¥25 hundred million, Other: ¥9 hundred million) for FY 2008, and ¥137 hundred million (Fire: ¥104 hundred million, Automobile: ¥20 hundred million, Other: ¥12 hundred million) for FY 2009.

(4) Operating Expenses

<Operating Expenses> (Yen in hundred millions)

					FY 2009
										Increase
			FY 2008				Increase			(decrease) ratio
			Amount		Amount		(decrease)			(%)
										%
Personnel expenses	(1	)		1,526		1,565		38			2.5
Non-personnel expenses	(2	)		1,352		1,230		(121	)		(9.0	)
Tax,	(3	)		142		137		(4	)		(3.2	)
Total	(4	)		3,021		2,934		(87	)		(2.9	)

(Note) Total company expenses = Loss adjustment expenses + Operating expenses and general and administrative expenses

<Operating Expenses Related to Underwriting> (Yen in hundred millions)

						FY 2009
												Increase
			FY 2008						Increase			(decrease) ratio
			Amount			Amount			(decrease)			(%)
												%
Operating expenses and general and administrative expenses	(5	)		2,131			2,078			(52	)		(2.5	)
Commission and collection expenses	(6	)		2,079			2,071			(7	)		(0.4	)
Total	(7	)		4,210			4,149			(60	)		(1.4	)
Net expense ratio	(8	)		34.0	%		34.5	%		0.5	%

(5) Outstanding Claims

(Yen in hundred millions)

	FY 2008					FY 2009
	Balance		Increase			Balance		Increase
Fire		467		(14	)		495		28
Marine		288		(4	)		260		(28	)
Personal accident		517		46			544		27
Voluntary automobile		2,589		(155	)		2,519		(69	)
Compulsory automobile liability		492		(5	)		482		(9	)
Other		1,240		(170	)		1,098		(141	)
Total		5,594		(304	)		5,401		(193	)

(Note) Increase in FY 2008 does not link with increase/decrease of balance, since balance of outstanding claims is transferred to MSIG Mingtai Insurance Co., Ltd. due to its combination with Taipei branch.

(6) Catastrophe Reserve

(Yen in hundred millions)

	FY 2008				FY 2009
			Ratio to							Ratio to
			net premiums							net premiums
	Balance		written (%)		Balance		Increase			written (%)
			%							%
Fire		2,009		116.3		2,168		159			123.3
Marine		602		93.9		622		20			120.0
Personal accident		811		62.9		746		(64	)		57.7
Voluntary automobile		173		3.2		171		(1	)		3.2
Other		1,222		67.7		1,275		53			74.4
Total		4,818		44.3		4,985		167			46.8

(Note) Ratio to net premiums written shows the ratio of balance to net premiums written (excluding premiums for earthquake insurance, compulsory automobile liability insurance and good result return of “ModoRich”). Ratio to net premiums written at the interim period is calculated by doubling net premiums paid.

(7) Investment Profit/losses, Ordinary Profit/losses and Net Profit/losses

(Yen in hundred millions)

												Increase
			FY 2008			FY 2009			Change			ratio (%)
												%
(+) Interest and dividends received	(1	)		1,378			1,174			(203	)		(14.8	)
(Return on assets under management (income yield))	(2	)		2.67	%		2.38	%		(0.29	%)
(–) Transfer of investment income on deposit premiums	(3	)		528			540			12			2.3
Net interest and dividends received	(4	)		850			634			(216	)		(25.4	)
(+) Gains/losses on sale of securities	(5	)		602			2			(600	)		(99.6	)
(–) Gains/losses on devaluation of securities	(6	)		1,095			48			(1,046	)		(95.5	)
(+) Gains/losses on devaluation of securities	(7	)		(7	)		252			260			—
(+) Other	(8	)		(409	)		(317	)		91			—
Total status of investment and other ordinary profit/losses	(9	)		(59	)		522			582			—
(+) Ordinary profit	(10	)		255			357			102			40.2
(+) Extraordinary profit/losses	(11	)		236			(26	)		(263	)		(111.2	)
(profit/losses concerning reserve for price fluctuation)	(12	)		259			1			(257	)		(99.3	)
Interim net profit before income taxes	(13	)		491			331			(160	)		(32.6	)
(–) Income taxes	(14	)		26			76			50			194.3
Interim net profit	(15	)		465			254			(211	)		(45.3	)

3. Status of Life Insurance Subsidiaries

(Unit: 100 million yen)

			Year ended		Year ended					Change Ratio
			March 31, 2009		March 31, 2010		Change			(%)
Life Insurance
Amount of New Policies
Mitsui Sumitomo	Individual Insurance	(1)		16,204		15,531		(672	)		(4.2	)
Kirameki life Insurance	Individual Annuities	(2)		334		340		6			1.8
Mitsui Sumitomo	Individual Insurance	(3)		542		16		(526	)		(96.9	)
MetLife Insurance	Individual Annuities	(4)		5,386		4,064		(1,322	)		(24.5	)
Amount of Policies in Force
Mitsui Sumitomo	Individual Insurance	(5)		87,155		91,292		4,137			4.7
Kirameki life Insurance	Individual Annuities	(6)		3,152		3,154		1			0.0
Mitsui Sumitomo	Individual Insurance	(7)		1,082		1,140		58			5.4
MetLife Insurance	Individual Annuities	(8)		23,705		30,235		6,530			27.5

II. Business results of Aioi Insurance Co., Ltd. (non-consolidated)

1. Summary of Consolidated Business Results for the Year Ended March 31, 2010

(Net Premiums Written, Ordinary Profit or Loss, Net Income or Loss)

(Unit: 100 million yen)

		Year ended			Year ended
		March 31,			March 31,
		2009			2010			Change			Change Ratio (%)
Net Premiums Written Note 1	(1)		8,291			8,114			(176	)		(2	)
Ordinary Profit (Loss)	(2)		(230	)		363			594			—
Aioi Insurance	(3)		(203	)		373			577			—
Net Income (Loss)	(4)		(109	)		166			275			—
Aioi Insurance	(5)		(95	)		181			277			—
Aioi Life Insurance	(6)		8			13			5			62
Other	(7)		(22	)		(28	)		(6	)		—

(Note) Figures for (5) and (6) are amounts before consolidation adjustments.

2. Status of Aioi Insurance Co., Ltd. (non-consolidated)

(1) Underwriting Profit/losses

			FY 2008			FY 2009			Change			Increase ratio
(+) Net premiums written	(1	)		8,166			7,940			(226	)		(2.8	)
(–) Net claims paid	(2	)		4,935			4,905			(29	)		(0.6	)
(–) Loss adjustment expenses	(3	)		370			437			67			18.2
(–) Commission and collection expenses	(4	)		1,441			1,400			(40	)		(2.8	)
(–) Operating expenses and general and administrative expenses related to underwriting	(5	)		1,383			1,416			33			2.4
Underwriting balance	(6	)		36			(220	)		(257	)		(696.6	)
(–) Provision for outstanding claims	(7	)		(110	)		94			204			—
(–) Provision for underwriting reserve	(8	)		16			(46	)		(63	)		(380.6	)
(–) Provision for catastrophe reserve	(9	)		(19	)		(194	)		(175	)		—
(+) Other	(10	)		35			31			(4	)		(11.4	)
Underwriting profit/losses	(11	)		185			(40	)		(226	)		(122.0	)
Ratios
Net loss ratio	(12	)		65.0	%		67.3	%		2.3	%
Net expense ratio	(13	)		34.6	%		35.5	%		0.9	%
Combined ratio	(14	)		99.6	%		102.8	%		3.2	%
Incurred loss (2)+(7)	(15	)		4,825			4,999			174			3.6
(Supplement: compulsory automobile liability excluded)
Net premiums written	(16	)		6,969			6,844			(125	)		(1.8	)
Ratios
Net loss ratio	(17	)		60.6	%		62.5	%		1.9	%
Net expense ratio	(18	)		35.5	%		36.3	%		0.8	%
Combined ratio	(19	)		96.1	%		98.8	%		2.7	%

(Note)	1.	Net loss ration = (Net claims paid + Loss adjustment expenses) / Net premiums written × 100
	2.	Net expense ratio = (Commission and collection expenses + Operating expenses and general and administrative expenses regarding underwriting) / Net premiums written × 100
	3.	Combined ratio = Net loss ratio + Net expense ratio

(2) Premiums

(Yen in hundred millions)

											Direct premiums written (excluding
	Net premiums written										deposit premiums from policyholders)
Period	FY 2008					FY 2009					FY 2008					FY 2009
			Increase					Increase					Increase					Increase
Line of business	Amount		ratio (%)			Amount		ratio (%)			Amount		ratio (%)			Amount		ratio (%)
			%					%					%					%
Fire		1,027		2.4			1,020		(0.6	)		1,222		4.1			1,221		(0.1	)
Marine		55		(13.2	)		37		(33.2	)		50		(9.8	)		36		(27.0	)
Personal accident		460		(3.9	)		450		(2.2	)		495		(2.1	)		484		(2.2	)
Voluntary automobile		4,668		(1.3	)		4,658		(0.2	)		4,588		(1.7	)		4,564		(0.5	)
Compulsory automobile liability		1,197		(19.9	)		1,095		(8.5	)		1,327		(15.8	)		1,231		(7.2	)
Other		757		1.2			677		(10.6	)		759		2.7			681		(10.2	)
Total		8,166		(4.1	)		7,940		(2.8	)		8,442		(3.2	)		8,220		(2.6	)

(3) Net Claims Paid

(Yen in hundred millions)

Period	FY 2008							FY 2009
			Increase			Net loss				Increase			Net loss		Difference
Line of business	Amount		ratio (%)			ratio (%)		Amount		ratio (%)			ratio (%)		(%)
			%			%				%			%		%
Fire		351		(2.0	)		35.9		373		6.3			38.7		2.8
Marine		34		(4.5	)		64.3		26		(24.1	)		73.3		9.0
Personal accident		214		5.3			50.0		218		2.0			52.8		2.8
Voluntary automobile		2,794		0.5			64.8		2,847		1.9			67.0		2.2
Compulsory automobile liability		1,002		0.1			90.2		976		(2.6	)		97.3		7.1
Other		538		(5.8	)		74.7		463		(13.8	)		73.0		(1.7	)
Total		4,935		(0.3	)		65.0		4,905		(0.6	)		67.3		2.3

(Note) Net loss ratio is calculated by adding loss adjustment expenses to net claims paid.

(Supplement) Status of Natural Disasters

(Yen in hundred millions)

	FY 2008						FY 2009
	Total						Total
	incurred loss		Net claims paid		Outstanding claims		incurred loss		Net claims paid		Outstanding claims
Fire		8		7		0		48		42		6
Voluntary automobile		18		18		0		10		10		0
Other		3		2		0		4		3		1
Total		29		28		1		63		56		7

(Note) Above figures relate to natural disasters that occurred during the respective periods. Net claims paid, including those for natural disasters that occurred prior to the periods are, ¥30 hundred million (Fire: ¥9 hundred million, Automobile: ¥18 hundred million, Other: ¥2 million) for FY 2008 and ¥57 hundred million (Fire: ¥43 hundred million, Automobile: ¥10 hundred million, Other: ¥3 million) for FY 2009.

(4) Operating Expenses

<Operating Expenses> (Yen in hundred millions)

					FY 2009
										Increase
			FY 2008				Increase			(decrease) ratio
			Amount		Amount		(decrease)			(%)
										%
Personnel expenses	(1	)		916		958		42			4.6
Non-personnel expenses	(2	)		821		881		59			7.3
Tax,	(3	)		96		89		(6	)		(7.1	)
Total	(4	)		1,834		1,930		95			5.2

(Note) Total company expenses = Loss adjustment expenses + Operating expenses and general and administrative expenses

<Operating Expenses Related to Underwriting> (Yen in hundred millions)

						FY 2009
												Increase
			FY 2008						Increase			(decrease) ratio
			Amount			Amount			(decrease)			(%)
												%
Operating expenses and general and administrative expenses	(5	)		1,383			1,416			33			2.4
Commission and collection expenses	(6	)		1,441			1,400			(40	)		(2.8	)
Total	(7	)		2,824			2,817			(7	)		(0.2	)
Net expense ratio	(8	)		34.6	%		35.5	%		0.9	%

(5) Outstanding Claims

(Yen in hundred millions)

	FY 2008					FY 2009
	Balance		Increase			Balance		Increase
Fire		212		(19	)		219		7
Marine		36		(11	)		21		(14	)
Personal accident		169		19			168		(1	)
Voluntary automobile		1,780		(41	)		1,769		(11	)
Compulsory automobile liability		361		(4	)		355		(6	)
Other		476		(52	)		594		119
Total		3,036		(110	)		3,128		94

(Note) Increase in FY 2008 does not link with increase/decrease of balance, since balance of outstanding claims was transferred due to its Tianjin branch office obtaining local corporate status.

(6) Catastrophe Reserve

(Yen in hundred millions)

	FY 2008				FY 2009
			Ratio to							Ratio to
			net premiums							net premiums
	Balance		written (%)		Balance		Increase			written (%)
			%							%
Fire		979		97.0		1,039		60			103.8
Marine		44		79.2		45		1			122.0
Personal accident		343		74.5		356		13			79.3
Voluntary automobile		769		16.5		477		(291	)		10.2
Other		268		35.4		290		21			42.8
Total		2,404		34.6		2,209		(194	)		32.4

(Note) Ratio to net premiums written shows the ratio of balance to net premiums written (excluding premiums for earthquake insurance and compulsory automobile liability insurance). Ratio to net premiums written at the interim period is calculated by doubling net premiums paid.

(7) Investment Profit/losses, Ordinary Profit/losses and Net Profit/losses

(Yen in hundred millions)

												Increase
			FY 2008			FY 2009			Change			ratio (%)
												%
(+) Interest and dividends received	(1	)		429			487			57			13.4
(Return on assets under management (income yield))	(2	)		2.01	%		2.38	%		0.37	%
(–) Transfer of investment income on deposit premiums	(3	)		202			183			(18	)		(9.1	)
Net interest and dividends received	(4	)		227			303			75			33.3
(+) Gains/losses on sale of securities	(5	)		439			131			(308	)		(70.1	)
(–) Gains/losses on devaluation of securities	(6	)		624			29			(594	)		(95.2	)
(+) Gains/losses on devaluation of securities	(7	)		(118	)		81			199			—
(+) Other	(8	)		(332	)		(83	)		249			—
Total status of investment and other ordinary profit/losses	(9	)		(407	)		403			810			—
(+) Ordinary profit	(10	)		(203	)		373			577			—
(+) Extraordinary profit/losses	(11	)		66			(103	)		(170	)		(255.3	)
(profit/losses concerning reserve for price fluctuation)	(12	)		59			(12	)		(72	)		(121.4	)
Interim net profit before income taxes	(13	)		(136	)		270			407			—
(–) Income taxes	(14	)		(41	)		88			129			—
Interim net profit	(15	)		(95	)		181			277			—

III. Business results of Nissay Dowa General Insurance Co., Ltd. (non-consolidated)

Status of Nissay Dowa General Insurance Co., Ltd. (non-consolidated)

(1) Underwriting Profit/losses

(Yen in hundred millions)

			FY 2008			FY 2009			Change			Increase ratio
												%
(+) Net premiums written	(1	)		3,109			3,126			17			0.6
(–) Net claims paid	(2	)		1,918			1,969			51			2.7
(–) Loss adjustment expenses	(3	)		176			180			4			2.4
(–) Commission and collection expenses	(4	)		533			541			8			1.6
(–) Operating expenses and general and administrative expenses related to underwriting	(5	)		543			515			(28	)		(5.2	)
Underwriting balance	(6	)		(62	)		(80	)		(18	)		—
(–) Provision for outstanding claims	(7	)		18			17			(1	)		(6.8	)
(–) Provision for underwriting reserve	(8	)		3			34			31			927.0
(–) Provision for catastrophe reserve	(9	)		20			(13	)		(34	)		(166.2	)
(+) Other	(10	)		17			16			(0	)		(4.5	)
Underwriting profit/losses	(11	)		(87	)		(102	)		(15	)		—
Ratios
Net loss ratio	(12	)		67.4	%		68.8	%		1.4	%
Net expense ratio	(13	)		34.6	%		33.8	%		(0.8	)%
Combined ratio	(14	)		102.0	%		102.6	%		0.6	%
Incurred loss (2)+(7)	(15	)		1,936			1,987			50			2.6
(Supplement: compulsory automobile liability excluded)
Net premiums written	(16	)		2,804			2,845			41			1.5
Ratios
Net loss ratio	(17	)		63.8	%		65.1	%		1.3	%
Net expense ratio	(18	)		35.8	%		34.5	%		(1.3	)%
Combined ratio	(19	)		99.6	%		99.6	%		0.0	%

(Note)	1.	Net loss ration = (Net claims paid + Loss adjustment expenses) / Net premiums written × 100
	2.	Net expense ratio = (Commission and collection expenses + Operating expenses and general and administrative expenses regarding underwriting) / Net premiums written × 100
	3.	Combined ratio = Net loss ratio + Net expense ratio

(2) Premiums

(Yen in hundred millions)

											Direct premiums written (excluding
	Net premiums written										deposit premiums from policyholders)
Period	FY 2008					FY 2009					FY 2008					FY 2009
			Increase					Increase					Increase					Increase
Line of business	Amount		ratio (%)			Amount		ratio (%)			Amount		ratio (%)			Amount		ratio (%)
			%					%					%					%
Fire		470		6.5			511		8.7			642		6.4			697		8.6
Marine		54		(1.3	)		45		(16.2	)		68		(0.3	)		56		(17.2	)
Personal accident		291		(2.7	)		283		(2.7	)		299		(2.1	)		292		(2.2	)
Voluntary automobile		1,588		(0.7	)		1,606		1.1			1,589		(0.6	)		1,608		1.2
Compulsory automobile liability		305		(21.0	)		281		(7.8	)		294		(15.2	)		280		(4.9	)
Other		399		(0.3	)		398		(0.2	)		568		19.4			670		17.9
Total		3,109		(2.3	)		3,126		0.6			3,463		1.8			3,605		4.1

(3) Net Claims Paid

(Yen in hundred millions)

Period	FY 2008							FY 2009
			Increase			Net loss				Increase			Net loss		Difference
Line of business	Amount		ratio (%)			ratio (%)		Amount		ratio (%)			ratio (%)		(%)
			%			%				%			%		%
Fire		175		2.4			39.0		190		8.1			38.7		(0.3	)
Marine		29		14.1			57.7		31		6.0			72.9		15.2
Personal accident		153		(7.1	)		58.2		160		4.6			61.9		3.7
Voluntary automobile		1,047		(3.9	)		73.2		1,089		4.0			75.1		1.9
Compulsory automobile liability		277		(0.9	)		99.9		267		(3.6	)		105.9		6.0
Other		233		9.1			60.6		230		(1.4	)		60.0		(0.5	)
Total		1,918		(1.5	)		67.4		1,969		2.7			68.8		1.4

(Note) Net loss ratio is calculated by adding loss adjustment expenses to net claims paid.

(Supplement) Status of Natural Disasters (Yen in hundred millions)

	FY 2008						FY 2009
	Total						Total
	incurred loss		Net claims paid		Outstanding claims		incurred loss		Net claims paid		Outstanding claims
Fire		17		14		2		42		36		6
Voluntary automobile		5		5		—		5		5		0
Other		2		1		0		4		2		2
Total		25		21		3		52		43		8

(Note) Above figures relate to natural disasters that occurred during the respective periods. Net claims paid, including those for natural disasters that occurred prior to the periods are, ¥34 hundred million (Fire: ¥26 hundred million, Automobile: ¥5 hundred million, Other: ¥2 million) for FY 2008 and ¥52 hundred million (Fire: ¥43 hundred million, Automobile: ¥5 hundred million, Other: ¥3 million) for FY 2009.

(4) Operating Expenses

<Operating Expenses> (Yen in hundred millions)

					FY 2009
										Increase
			FY 2008				Increase			(decrease) ratio
			Amount		Amount		(decrease)			(%)
										%
Personnel expenses	(1	)		360		356		(3	)		(1.1	)
Non-personnel expenses	(2	)		364		342		(21	)		(6.0	)
Tax,	(3	)		35		35		(0	)		(1.0	)
Total	(4	)		760		734		(26	)		(3.4	)

(Note) Total company expenses = Loss adjustment expenses + Operating expenses and general and administrative expenses

<Operating Expenses Related to Underwriting> (Yen in hundred millions)

						FY 2009
												Increase
			FY 2008						Increase			(decrease) ratio
			Amount			Amount			(decrease)			(%)
												%
Operating expenses and general and administrative expenses	(5	)		543			515			(28	)		(5.2	)
Commission and collection expenses	(6	)		533			541			8			1.6
Total	(7	)		1,077			1,057			(19	)		(1.8	)
Net expense ratio	(8	)		34.6	%		33.8	%		(0.8)	%

(5) Outstanding Claims

(Yen in hundred millions)

	FY 2008					FY 2009
	Balance		Increase			Balance		Increase
Fire		116		6			102		(14	)
Marine		29		(2	)		24		(5	)
Personal accident		115		7			120		5
Voluntary automobile		660		9			702		41
Compulsory automobile liability		99		(2	)		96		(2	)
Other		236		(0	)		229		(7	)
Total		1,258		18			1,275		17

(Note) Increase in FY 2008 does not link with increase/decrease of balance, since balance of outstanding claims was transferred due to its Tianjin branch office obtaining local corporate status.

(6) Catastrophe Reserve

(Yen in hundred millions)

	FY 2008				FY 2009
			Ratio to							Ratio to
			net premiums							net premiums
	Balance		written (%)		Balance		Increase			written (%)
			%							%
Fire		551		119.4		571		20			113.9
Marine		80		148.5		80		0			177.9
Personal accident		159		54.7		146		(12	)		51.7
Voluntary automobile		127		8.1		92		(35	)		5.7
Other		220		55.2		235		14			58.9
Total		1,139		40.8		1,126		(13	)		39.7

(7) Investment Profit/losses, Ordinary Profit/losses and Net Profit/losses

(Yen in hundred millions)

											Increase
		FY 2008			FY 2009			Change			ratio (%)
											%
(+) Interest and dividends received	(1)		238			211			(27	)		(11.5	)
(Return on assets under management (income yield))	(2)		2.58	%		2.38	%		(0.20	%)
(–) Transfer of investment income on deposit premiums	(3)		83			77			(6	)		(7.3	)
Net interest and dividends received	(4)		155			134			(21	)		(13.8	)
(+) Gains/losses on sale of securities	(5)		57			179			121			211.2
(–) Gains/losses on devaluation of securities	(6)		190			51			(138	)		(72.9	)
(+) Gains/losses on devaluation of securities	(7)		(31	)		(3	)		28			—
(+) Other	(8)		(68	)		(53	)		15			—
Total status of investment and other ordinary profit/losses	(9)		(76	)		205			282			—
(+) Ordinary profit	(10)		(168	)		100			269			—
(+) Extraordinary profit/losses	(11)		61			(64	)		(125	)		(205.6	)
(profit/losses concerning reserve for price fluctuation)	(12)		64			(6	)		(70	)		(109.9	)
Interim net profit before income taxes	(13)		(107	)		35			143			—
(+) Income taxes	(14)		(39	)		5			45			—
Interim net profit	(15)		(67	)		30			97			—

IV. Summary of Financial Results of MS&AD Insurance Group Holdings (Simple Combination)

Simple Combination of the Three Groups (Consolidated) Note 1

(Unit: 100 million yen)

			Year Ended			Year Ended					Change Ratio
			March 31, 2009			March 31, 2010		Change			(%)
Net Premiums Written Note 2	(1	)		25,910			25,190		(720	)		(2.8	)
Fire and Allied	(2	)		3,698			3,717		19			0.5
Marine	(3	)		1,045			842		(203	)		(19.4	)
Personal Accident	(4	)		2,110			2,087		(22	)		(1.1	)
Voluntary Automobile	(5	)		12,503			12,519		16			0.1
Compulsory Automobile Liability	(6	)		2,987			2,726		(260	)		(8.7	)
Other	(7	)		3,566			3,296		(269	)		(7.6	)
Ordinary Profit (Loss)	(8	)		(529	)		991		1,520			—
Net Income (Loss)	(9	)		(94	)		573		668			—
Total Assets	(10	)		113,450			114,813		1,362			1.2

(Note)	1.	Simple combination of Mitsui Sumitomo Insurance Group Holdings (Consolidated), Aioi Insurance (Consolidated) and Nissay Dowa General Insurance (Non-Consolidated).
	2.	Net premiums written exclude Good Result Return premiums of Mitsui Sumitomo Insurance’s proprietary auto insurance product “Modorich” which contains a special clause related to premium adjustment and refund at maturity.
	3.	Figures in 2 through 7 are prior to consolidation adjustments.

Simple Combination of the Three Non-Life Insurance Subsidiaries (Non-Consolidated) Note 1

(Unit: 100 million yen)

			Year Ended			Year Ended						Change Ratio
			March 31, 2009			March 31, 2010			Change			(%)
Net Premiums Written Note 2	(1	)		23,670			23,104			(565	)		(2.4	)
Fire and Allied	(2	)		3,260			3,326			66			2.0
Marine	(3	)		751			601			(150	)		(20.0	)
Personal Accident	(4	)		2,040			2,028			(12	)		(0.6	)
Voluntary Automobile	(5	)		11,667			11,631			(35	)		(0.3	)
Compulsory Automobile Liability	(6	)		2,985			2,723			(261	)		(8.8	)
Other	(7	)		2,964			2,792			(171	)		(5.8	)
Underwriting Income (Loss)	(8	)		422			(303	)		(726	)		(171.7	)
Ordinary Profit (Loss)	(9	)		(116	)		832			948			—
Net Income	(10	)		302			466			163			54.1
Total Assets	(11	)		94,972			95,015			42			0.0
Net Loss Ratio Note 2	(12	)		67.6	%		69.1	%		1.5	%
Net Expense Ratio Note 2	(13	)		34.3	%		34.7	%		0.4	%
Combined Ratio Note 2	(14	)		101.9	%		103.8	%		1.9	%
(Reference: Excluding Compulsory Automobile Liability Insurance)
Net Premiums Written Note 2	(15	)		20,684			20,381			(303	)		(1.5	)
Net Loss Ratio Note 2	(16	)		63.5	%		64.5	%		1.0	%
Net Expense Ratio Note 2	(17	)		35.5	%		35.8	%		0.3	%
Combined Ratio Note 2	(18	)		99.0	%		100.3	%		1.3	%

(Note)	1.	Simple combination of Mitsui Sumitomo Insurance (Non-Consolidated), Aioi Insurance (Non-Consolidated) and Nissay Dowa General Insurance (Non-Consolidated).
	2.	Figures exclude Good Result Return premiums of Mitsui Sumitomo Insurance’s proprietary auto insurance product “Modorich” which contains a special clause related to premium adjustment and refund at maturity.
	3.	Net Loss Ratio = (Net Claims Paid + Loss Adjustment Expenses) / Net Premiums Written * 100
	4.	Net Expense Ratio = (Commission and Collection Expenses + Operating Expenses and General and Administrative Expenses on Underwriting) / Net Premiums Written * 100
	5.	Combined Ratio = Net Loss Ratio + Net Expense Ratio

V. Result Forecast for the Fiscal Year ending March 31, 2011

1. MS&AD Insurance Group Holdings (Consolidated)

(Unit: 100 million yen)

					(Reference) Change from
			Forecast for the year		previous year
			ending March 31, 2011		Note 2
Net Premiums Written Note 1	(1	)		25,800		2.4	%
(Overseas Non-Life Insurance Subsidiaries)	(2	)		1,945		10.4	%
Ordinary Profit	(3	)		860		(131	)
Net Income	(4	)		510		(63	)
Dividend per Share (Annual)	(5	)	¥	54.00	¥	—

2. Mitsui Sumitomo Insurance (Non-Consolidated)

(Unit: 100 million yen)

			Forecast for the year
			ending March 31, 2011		Change from previous year
Net Premiums Written Note 1	(6	)		12,280		2.0	%
Ordinary Profit	(7	)		470		112
Net Income	(8	)		260		5

3. Aioi Nissay Dowa Insurance (Non-Consolidated) Note 3

(Unit: 100 million yen)

			Forecast for the year
			ending March 31, 2011		Change from previous year
Net Premiums Written	(9	)		11,230		1.5	%
Ordinary Profit	(10	)		260		(214	)
Net Income	(11	)		20		(192	)

(Note)	1.	Net premiums written exclude Good Result Return premiums of Mitsui Sumitomo Insurance’s proprietary auto insurance product “Modorich” which contains a special clause related to premium adjustment and refund at maturity.
	2.	Figures in change from previous year for MS&AD Insurance Group Holdings represent changes in comparison with the combined consolidated results of Mitsui Sumitomo Insurance Group Holdings, Aioi Insurance and Nissay Dowa General Insurance for the year ended March 31, 2010.
	3.	Aioi Insurance and Nissay Dowa General Insurance will be merged on October 1, 2010 to create Aioi Nissay Dowa Insurance. Forecast for Aioi Nissay Dowa Insurance represents the simple combination of the non-consolidated forecast for the first half of the fiscal year of Nissay Dowa General Insurance and the non-consolidated full-year forecast of Aioi Nissay Dowa Insurance.

Mitsui Sumitomo Insurance Company, Limited, non-consolidated

(Answer to joint questions from the press)

Supplementary Information to Financial Statements as of March 31, 2010

(Yen in hundred millions)

							FY 2009
				Six months ended									Change from six
				September 30,						Change from			months ended
	FY 2008			2009						FY 2008			September 30, 2009
(1) Net premiums written		12,393			6,082			12,037			(356	)		—
Increase ratio (%)		(5.2	%)		(5.3	%)		(2.9	%)		2.3	%		2.4	%
(2) Total assets		59,773			60,301			59,719			(53	)		(581	)
(3) Loss ratio (%)		69.5	%		67.5	%		70.3	%		0.8	%		2.8	%
(4) Expense ratio (%)		34.0	%		33.3	%		34.5	%		0.5	%		1.2	%
(5) Combined ratio (%)		103.5	%		100.8	%		104.8	%		1.3	%		4.0	%
Underwriting balance ratio (%)		(3.5	%)		(0.8	%)		(4.8	%)		(1.3	%)		(4.0	%)
(6) Automobile
-Net premiums written		5,411			2,663			5,367			(43	)		—
Increase ratio (%)		(1.9	%)		(2.4	%)		(0.8	%)		1.1	%		1.6	%
-Underwriting balance ratio (%)		(7.2	%)		(4.7	%)		(7.6	%)		(0.4	%)		(2.9	%)
-Loss ratio (%)		73.2	%		71.4	%		73.4	%		0.2	%		2.0	%
-Expense ratio (%)		34.0	%		33.3	%		34.2	%		0.2	%		0.9	%
(7) Fire
- Net premiums written		1,761			876			1,794			32			—
Increase ratio (%)		(0.1	%)		0.3	%		1.8	%		1.9	%		1.5	%
-Underwriting balance ratio (%)		14.5	%		20.3	%		14.4	%		(0.1	%)		(5.9	%)
-Loss ratio (%)		42.6	%		39.2	%		43.3	%		0.7	%		4.1	%
-Expense ratio (%)		42.9	%		40.5	%		42.3	%		(0.6	%)		1.8	%
(8) Number of employees		15,105			15,318			15,151			46			(167	)
(9) Number of agents		41,519			40,686			39,927			(1,592	)		(759	)

(Note)	1.	Net premiums written and other ratios are calculated excluding Good Result Return premiums of “ModoRich (proprietary automobile insurance product which contains a special clause related to premium adjustment and refund at maturity)”.
	2.	Loss ratio = (Net claims paid + Loss adjustment expenses) / Net premiums written × 100
	3.	Expense ratio = (Commissions and collection expenses + Operating expenses and general and administrative expenses related to underwriting) / Net premiums written × 100
	4.	Combined ratio = Loss ratio + Expense ratio
	5.	Underwriting balance ratio = 100 – Combined ratio
	6.	Items shown with % within “Change from FY 2008” and “Change from Six months ended September 30, 2009” column, shows amount of balance compared to amount of FY 2008, and six months ended September 30, 2009, respectively.

<Reference> Consolidated Indices (Consolidated financial figures for Mitsui Sumitomo Insurance Group Holdings, Inc.)

(Yen in hundred millions)

							FY 2009
				Six months ended									Change from six
				September 30,						Change from			months ended
	FY 2008			2009						FY 2008			September 30, 2009
(1) Ordinary income		20,400			10,156			19,626			(773	)		—
(2) Net premiums written		14,510			7,115			13,949			(561	)		—
Increase ratio (%)		(5.6	%)		(6.3	%)		(3.9	%)		1.7	%		2.4	%
(3) Life insurance premiums written		1,333			629			1,351			17			—
Increase ratio (%)		(14.8	%)		(9.3	%)		1.3	%		16.1	%		10.6	%
(4) Ordinary profit		(130	)		822			526			657			—
(5) Net income		81			568			376			294			—

(Note) Net premiums written are calculated excluding Good Result Return premiums of “ModoRich (proprietary automobile insurance product which contains a special clause related to premium adjustment and refund at maturity)”.

Mitsui Sumitomo Insurance Company, Limited, non-consolidated

(1) Disclosures on Bad Debts

[Credit Obligations under Risk Management] (Yen in hundred millions)

				Six months ended
	FY 2008			September 30, 2009			FY 2009
Currently in bankruptcy		0			0			14
Delinquent in payments		26			52			24
Delinquent in payments for 3 months or more		8			10			8
Favorable loan revisions completed		8			36			20
Total		42			99			67
Ratio to balance of loans (%)		0.6	%		1.4	%		0.9	%
Reference: balance of loans		7,546			7,321			7,185

[Results of Self Evaluations] (Yen in hundred millions)

			Six months ended
	FY 2008		September 30, 2009		FY 2009
No category		58,047		58,997		58,468
Category II		1,696		1,237		1,183
Category III		17		36		24
Category IV		1,112		112		105
Total category II-IV		2,827		1,386		1,314
Total		60,874		60,384		59,782

(Note) Total indicates the amount of balance before direct depreciation based on self evaluation (including impairment of securities, etc., and loss due to impairment of fixed assets).

Amount of balance before direct depreciation:

FY 2008		¥1,101 hundred millions
(not including ¥6 hundred millions loss due to impairment of fixed assets for the interim period)
Six months ended September 30, 2009		¥82 hundred millions
FY 2009		¥63 hundred millions
(not including ¥1 hundred millions loss due to impairment of fixed assets for the interim period)

(2) Loss on Devaluation of Securities Due to Impairment

(Yen in hundred millions)

			Six months ended
	FY 2008		September 30, 2009		FY 2009
Bonds		20		—		—
Stocks		357		23		29
Foreign securities		475		53		14
Other securities		242		3		5
Total		1,095		80		48

Devaluation rules applied

In principle, marketable securities whose fair market value declined by 30% or more of book value are devaluated.

(3) Status of Securitized Instruments Losses, etc., due to US Subprime Loan Issues

Concerning policies including the subprime loan instruments, claim paid (including outstanding claims) of ¥0.1 billion are recorded in financial guarantee reinsurance. There is no investment in securitized instruments relating to subprime loan instruments.

Please refer to page 57 of the summary of financial statements for the fiscal year ended March 31, 2010 for the investment conditions of securitized instruments and our exposure to the US subprime loan.

Mitsui Sumitomo Insurance Company, Limited, non-consolidated

(4) Impairment of Fixed Assets

(Yen in hundred millions)

(5) Unrealized Profit/losses of Securities

(Yen in hundred millions)

				Six months ended
	FY 2008			September 30, 2009			FY 2009
Bonds		233			377			359
Stocks		4,913			7,150			8,467
Foreign securities		(583	)		(217	)		59
Other		(25	)		36			59
Total		4,528			7,347			8,945

(Note)		1.		Above figures show amounts for other securities with fair market value.
		2.		Other includes monetary claims bought.

(6) Status of Underwriting Operations of Third-sector Insurance

(in hundreds)

Breakdown of total number for FY 2009

Total number for FY 2009

Mitsui Sumitomo

Changes from the

Insurance Company,

Subsidiaries

Lines

Number

previous six months

Limited

(Note 3)

Number of policies

1,411

200

234

1,176

(Note)	1.	Total and respective number of policies for Mitsui Sumitomo Insurance Company, Limited and its subsidiaries from April, 2009 to March, 2010.
	2.	Above numbers show number of policies.
	3.	Subsidiaries item show the number for Mitsui Sumitomo Kirameki Life Insurance Company, Limited.

(7) Impact of Natural Disasters

(Yen in hundred millions)

(Note)		1.		Above figures are based on natural disasters that occurred during respective fiscal year. Net claims paid including claims for natural disasters that occurred during the last fiscal year are ¥7.3 hundred million for FY 2008, ¥2.8 hundred million for the Six months ended September 30, 2009, and ¥13.7 hundred million for FY 2009.
		2.		Accrued claims = Excess amount of outstanding claims over estimated recoveries

(8) Balance, Ratio to Balance and Amount of Provision for Catastrophe Reserve

(Yen in hundred millions)

	FY 2008							Six months ended September 30, 2009							FY 2009
			Ratio to							Ratio to							Ratio to
Lines	Balance		balance (%)			Provision		Balance		balance (%)			Provision		Balance		balance (%)			Provision
Fire		2,009		116.3	%		157		2,087		121.5	%		78		2,168		123.3	%		159
Marine		602		93.9	%		25		612		114.9	%		10		622		120.0	%		20
Personal accident		811		62.9	%		39		809		60.0	%		20		746		57.7	%		39
Voluntary Auto		173		3.2	%		173		85		1.6	%		85		171		3.2	%		171
Other		1,222		67.7	%		92		1,238		66.8	%		46		1,275		74.4	%		84
Total		4,818		44.3	%		486		4,833		44.8	%		241		4,985		46.8	%		475

(Note)	1.	Ratio to balance = Balance of catastrophe reserve / net premiums written (excluding premiums for earthquake insurance for household customers, compulsory auto liability insurance and Good Result Return of “ModoRich”) × 100
		Ratio to balance for the interim period is calculated by doubling the net premiums written.
	2.	Provision = Gross provision

Mitsui Sumitomo Insurance Company, Limited, non-consolidated

(9) Status of Reinsurance Underwriting

(Yen in hundred millions)

	FY 2008				FY 2009
	Net reinsurance		Net reinsurance		Net reinsurance		Net reinsurance
Lines	premiums assumed		claims paid		premiums assumed		claims paid
Fire		202		96		220		67
Marine		150		93		101		62
Personal accident		16		11		20		13
Voluntary auto		28		15		25		14
Compulsory auto liability		1,044		1,372		936		1,334
Other		190		91		156		200
Total		1,632		1,681		1,461		1,692

(10) Status of Ceded Reinsurance

(Yen in hundred millions)

	FY 2008				FY 2009
	Net reinsurance		Net reinsurance		Net reinsurance		Net reinsurance
Lines	premiums ceded		recoveries		premiums ceded		recoveries
Fire		604		146		624		55
Marine		287		124		238		142
Personal accident		68		37		71		41
Voluntary auto		34		15		33		16
Compulsory auto liability		937		1,271		883		1,273
Other		257		71		276		98
Total		2,189		1,666		2,129		1,628

Aioi Insurance Co., Ltd., non-consolidated

(Answer to joint questions from the press)

Supplementary Information to Financial Statements as of March 31, 2010

(Yen in hundred millions)

							FY 2009
													Change from six
				Six months ended									months ended
				September 30,						Change from			September 30,
	FY 2008			2009						FY 2008			2009
(1) Net premiums written		8,166			3,978			7,940			(226	)		—
Increase ratio (%)		(4.1	%)		(4.8	%)		(2.8	%)		1.3	%		2.0	%
(2) Total assets		24,197			24,359			24,232			35			(126	)
(3) Loss ratio (%)		65.0	%		65.7	%		67.3	%		2.3	%		1.6	%
(4) Expense ratio (%)		34.6	%		35.5	%		35.5	%		0.9	%		—
(5) Combined ratio (%)		99.5	%		101.1	%		102.8	%		3.3	%		1.7	%
Underwriting balance ratio (%)		0.5	%		(1.1	%)		(2.8	%)		(3.3	%)		(1.7	%)
(6) Automobile
-Net premiums written		4,668			2,327			4,658			(9	)		—
Increase ratio (%)		(1.3	%)		(1.2	%)		(0.2	%)		1.1	%		1.0	%
-Underwriting balance ratio (%)		2.3	%		0.7	%		(0.7	%)		(3.0	%)		(1.4	%)
-Loss ratio (%)		64.8	%		65.9	%		67.0	%		2.2	%		1.1	%
-Expense ratio (%)		32.9	%		33.5	%		33.7	%		0.8	%		0.2	%
(7) Fire
- Net premiums written		1,027			480			1,020			(6	)		—
Increase ratio (%)		2.4	%		(2.8	%)		(0.6	%)		(3.0	%)		2.2	%
-Underwriting balance ratio (%)		20.6	%		20.2	%		17.7	%		(2.9	%)		(2.5	%)
-Loss ratio (%)		35.9	%		35.3	%		38.7	%		2.8	%		3.4	%
-Expense ratio (%)		43.5	%		44.6	%		43.6	%		0.1	%		(1.0	%)
(8) Number of employees		9,075			9,421			9,346			271			(75	)
(9) Number of agents		39,483			39,591			39,411			(72	)		(180	)

(Note)	1.	Loss ratio = (Net claims paid + Loss adjustment expenses) / Net premiums written × 100
	2.	Expense ratio = (Commissions and collection expenses + Operating expenses and general and administrative expenses related to underwriting) / Net premiums written × 100
	3.	Combined ratio = Loss ratio + Expense ratio
	4.	Underwriting balance ratio = 100 – Combined ratio
	5.	Items shown with % within “Change from FY 2008” and “Change from Six months ended September 30, 2009” column, shows amount of balance compared to amount of FY 2008, and six months ended September 30, 2009, respectively.

<Reference> Consolidated Indices (Yen in hundred millions)

							FY 2009
													Change from six
				Six months ended									months ended
				September 30,						Change from			September 30,
	FY 2008			2009						FY 2008			2009
(1) Ordinary income		10,755			5,189			10,441			(313	)		—
(2) Net premiums written		8,291			4,086			8,114			(176	)		—
Increase ratio (%)		(4.9	%)		(5.1	%)		(2.1	%)		2.8	%		3.0	%
(3) Life insurance premiums written		712			369			777			64			—
Increase ratio (%)		(1.1	%)		1.9	%		9.1	%		10.2	%		7.2	%
(4) Ordinary profit (loss)		(230	)		276			363			594			—
(5) Net income (loss)		(109	)		171			166			275			—

Aioi Insurance Co., Ltd., non-consolidated

(1) Disclosures on Bad Debts

[Credit Obligations under Risk Management] (Yen in hundred millions)

				Six months ended
	FY 2008			September 30, 2009			FY 2009
Currently in bankruptcy		0			0			1
Delinquent in payments		15			24			14
Delinquent in payments for 3 months or more		13			12			10
Favorable loan revisions completed		7			7			15
Total		36			44			41
Ratio to balance of loans (%)		1.1	%		1.3	%		1.3	%
Reference: balance of loans		3,494			3,399			3,241

[Results of Self Evaluations] (Yen in hundred millions)

			Six months ended
	FY 2008		September 30, 2009		FY 2009
No category		22,137		22,661		22,651
Category II		252		254		264
Category III		6		12		3
Category IV		657		46		42
Total category II-IV		916		313		309
Total		23,054		22,975		22,960

(Note) Figures above are amounts before depreciation (before appropriating valuation loss and impairment loss).

(2) Loss on Devaluation of Securities Due to Impairment

(Yen in hundred millions)

			Six months ended
	FY 2008		September 30, 2009		FY 2009
Bonds		4		—		—
Stocks		254		30		15
Foreign securities		248		3		4
Other securities		116		—		9
Total		624		33		29

Devaluation rules applied

In principle, marketable securities whose fair market value declined by 30% or more of book value are devaluated.

(3) Status of Securitized Instruments Losses, etc., due to US Subprime Loan Issues

Please refer to page 56 “Investment Conditions of Securitized Instruments” of the summary of financial statements for the fiscal year ended March 31, 2010 (Aioi Insurance Co., Ltd.).

Aioi Insurance Co., Ltd., non-consolidated

(4) Impairment of Fixed Assets

(Yen in hundred millions)

(5) Unrealized Profit/losses of Securities

(Yen in hundred millions)

				Six months ended
	FY 2008			September 30, 2009			FY 2009
Bonds		56			108			98
Stocks		(1	)		550			637
Foreign securities		(404	)		(286	)		(173	)
Other		(197	)		(45	)		1
Total		(545	)		327			563

(6) Status of Underwriting Operations of Third-sector Insurance (*)

(in hundreds)

Total number for FY 2009

Breakdown of total number for FY 2009

Mitsui Sumitomo

Changes from the

Insurance Company,

Subsidiaries

Lines

Number

previous six months

Limited

(Note 3)

Number of policies

417

(21

)

392

(Note)		Total and respective number of policies for Aioi Insurance Co., Ltd. and its subsidiaries from April, 2009 to March, 2010.
*		Total of medical insurance and cancer insurance (injury insurance and nursing care insurance excluded)

(7) Impact of Natural Disasters

(Yen in hundred millions)

(Note) Above figures are based on natural disasters that occurred during respective fiscal year. * Accrued claims = Excess amount of outstanding claims over estimated recoveries

(8) Balance, Ratio to Balance and Amount of Provision for Catastrophe Reserve

(Yen in hundred millions)

	FY 2008							Six months ended September 30, 2009							FY 2009
			Ratio to							Ratio to							Ratio to
Lines	Balance		balance (%)			Provision		Balance		balance (%)			Provision		Balance		balance (%)			Provision
Fire		979		97.0	%		80		1,007		106.9	%		28		1,039		103.8	%		60
Marine		44		79.2	%		2		44		127.2	%		0		45		122.0	%		1
Personal accident		343		74.5	%		14		350		75.6	%		7		356		79.3	%		14
Voluntary Auto		769		16.5	%		328		665		14.3	%		116		477		10.2	%		232
Other		268		35.4	%		36		278		37.3	%		17		290		42.8	%		31
Total		2,404		34.6	%		461		2,347		34.3	%		170		2,209		32.4	%		340

(Note)		Ratio to balance = Balance of catastrophe reserve / net premiums written (excluding premiums for earthquake insurance for household customers and compulsory automobile liability insurance) × 100
		Ratio to balance for the interim period is calculated by doubling the net premiums written (excluding premiums for earthquake insurance for household customers and compulsory automobile liability insurance)
		Provision = Gross provision

Aioi Insurance Co., Ltd., non-consolidated

(9) Status of Reinsurance Underwriting

(Yen in hundred millions)

Six months ended

September 30, 2009