F

O

R

A

B

E

T

T

E

R

T

O

M

O

R

R

O

W

Year Ended March 20, 2008

ANNUAL REPORT

2008
Japanese Consumers' Co-operative Union
JCCU CO-OP Insurance Business CenterA N N U A L R E P O R T 2008
Year Ended March 20, 2008

CONTENTS
Financial Highlights

01

Message from the Executive Director

02

Topics in fiscal 200704

Co-op, JCCU and CO-OP Insurance

08

Types of CO-OP Insurance

09

Payment of Claims

10Compliance and Policy on solicitation

11

International activities and LPA

13

Health and Welfare

14

Fiscal 2007 CO-OP Insurance Business Overview

15

Balance sheet

17

Income statement

18

Solvency Margin Ratio and others

19

Structure of CO-OP Insurance Business Center

20

JCCU at a Glance21

The official name of our organization is the Japanese Consumers'
Co-operative Union, commonly abbreviated as JCCU.

Financial Highlights
For the years ended March 20,

Thousands of
U.S. dollars*2

Millions of yen*1

2006

2007

2008

Changes2008

Ordinary income¥ 69,230¥ 77,890¥ 91,727(+17.8%)$ 919

Ordinary expenses

29,98534,83045,874(+31.7%)460

Ordinary surplus

20,36922,00821,460(-2.5%)

215

Net surplus

14,54915,265

12,109(-20.7%)

121

Total assets

73,35787,405

104,488(+19.5%)

1,047

Total liabilities

29,07437,08750,717(+36.8%)508

Total capital

44,28250,31753,770(+6.9%)

539

Number of policies (total)

5,777,941

6,263,379

6,677,739(+6.6%)―

Number of policies (direct insurance total)

5,381,453

5,861,815

6,265,849(+6.9%)―¥ 7,690¥ 8,472¥ 9,173(+8.3%)

$ 91

863.9

951.7

1,330.5(+378.8pt.)―

As of March 20,

Amount insured (direct insurance total)(¥ billions/ $ millions)
Solvency margin (%)

1. Yen Amounts are rounded down to the nearest ¥ 1 million.
2. U.S. dollar amounts are translated, for convenience only, at ¥ 99.72 = US$1.00, the rate prevailing on March 20, 2008, and rounded down to the nearest$1 million.

Total Assets

Number of policies (all total)

Amount insured (direct insurance)

104,488(¥ millions)(thousand)

100,000

9,173(¥ billions)
9,000

7,000

8,472

6,677

90,00087,405

6,263
8,000
6,000

80,00073,357

5,286

70,000

5,000

7,690

5,777
6,987

7,000
6,335

4,792
6,000

60,00057,9974,000

50,0005,000

45,611
4,000

3,000

40,0003,000

30,000

2,000
2,000

20,000
1,000

1,000

10,000
0

04

05

06

07

08

0

04

05

06

07

08

0

04

05

06

07

08

Japanese Consumers' Co-operative Union 01

Message from the Executive Director
Enlarged Circle of Mutual Help for 6.7 Million
People, and Response to the Revised Consumers'
Co-operative Society Law (Co-op Law)
Fiscal 2007 is the first year of the “Mid-Term Mutual
Insurance project 2007-2009” (hereinafter, the “Mid-Termproject ” ), our action plan to achieve the basic goals
specified in the “Problems and Goals of CO-OP Insurance
Yoshihiko Ito
Executive Director

Towards 2015.” In fiscal 2007, the Japanese Consumers’
Co-operative Union (JCCU) made efforts to achieve
important policy targets indicated in the Mid-term project
while holding improved promotional activities anddeveloped or improved commodities. As a result, thenumber of member customers for CO-OP Insurance
increased by 410,000, totaling approximately 6.67 million
at the end of fiscal 2007. In compliance with the wishes ofmember customers, “Tasukeai ”, an insurance product forbasic medical care for women was improved so that
hospitalization benefits can be paid from the first day of
hospitalization in the event of sickness. As a result,insurance products for all courses, including the course
for children, were improved so that hospitalization
benefit may be paid from the first day of hospitalization in
the event of sickness. The education system was also
revised and training was given to persons in charge of our
promotional activities so that more appropriate co-op
promotions can be made.
In 2007, the Co-op Law, which is the enabling law for
co-ops, was revised for the first time in 59 years(hereinafter, the “Revised Law”.) The revision to the Law
was made to reflect changes in the lives of consumers andthe role of today’s co-ops. Improvements have been
made to the mutual insurance business, with improved
measures to protect consumers, including ensuringsoundness and transparency of management andrestrictions on the simultaneous conducting of mutual
insurance and other business.
Consistent with the objectives of revision of the Law,
the JCCU has a policy to improve the structure on which
the mutual insurance business is implemented so that02

Annual Report 2008

consumers may become member customers of co-ops
without concerns. The largest problem for the mutual

Our Aim as the Co-op is to Secure the Fullest
Confidence of our Member Customers

insurance business of co-ops is restrictions on the

The JCCU has created a slogan: “Let's build a mutual

simultaneous conducting of mutual insurance and otherinsurance business that can contribute to the full to ourbusiness. The JCCU together with its member co-ops

member customers together with member co-ops,

began preparations for a new consumers’ co-operative

following our `future-oriented joint business policy’ !”CO-OP Insurance aims to continue to increase theunion specializing in mutual insurance.

number of member customers in order to contribute to

Payment of Benefits

the daily lives of as many member customers as possible

In fiscal 2007, the JCCU reinspected the conditions forin the insurance sector. At the same time, the JCCU will

payment of benefits for 3.67 million cases over the pastenhance a broad range of operations to establish a new

five years. As a result, it was found that the payment ofconsumers’ co-operative union specializing in mutual

benefits in 233 cases was insufficient by approximately

insurance and to improve the level of compliance with

14.37 million yen. The deficient amount was paid

the Revised Law.

immediately. Payment of benefits is important and usefulWe are determined to tackle various problems so thatfor member customers. We take this fact very seriously,

we will really be “a co-op that can secure the fullest

and deeply apologize to our member customers and theconfidence of our member customers.” We sincerely hopeparties concerned for these underpayments. At the samethat you understand our aims and that you will cooperatetime, we will take measures to prevent any recurrence,with us in achieving them.

and improve our operations so that we pay benefits
speedily and accurately.

Visions of CO-OP Insurance
Through CO-OP Insurance and the mutual assistance of CO-OP members, we are aiming to enrich society,promote cooperative activities, develop CO-OP and improve the lifestyles of members based on covering
economic loss caused by the various risks in members' lives.

1

We will offer insurance products that suit members' needs with more reasonable premiums and better coverage.

2

We will promote communication between members and CO-OP employees, and encourage a spirit of mutual
aid among members.

3

We will offer members the opportunity to learn about insurance and acquire the ability to select theinsurance that suits them most.

4

We will increase the social credibility of cooperative business by the stable management of the insurance andthe expansion of the insured.

5

We will positively face the problems of aging, health and welfare, and conduct activities to contribute tosociety, such as social welfare activities.

Japanese Consumers' Co-operative Union 03

Topics in fiscal 2007
1

CO-OP Insurance improves products based on member feedback
CO-OP Insurance is developing and improving products based on member
feedback. In fiscal 2007, we worked on product improvement, which was arequest from the majority of members. We will continue our products inorder to let as many people as possible join the insurance cooperative andto meet member requests.
● Tasukeai (Women plans, Medical plans, Basic plans,
Silver 70 plan) : Hospitalization coverage from the first day !
※ Before the revision, benefits had been paid for hospitalization of two days or longer
as a concession for the period from the 1st to the 184th days of hospitalization.

2

CO-OP Insurance reflects policyholder feedback in the business
CO-OP Insurance established the consultation center, which is dedicated to handling complaints andrequests regrinding participation and claims payments, in March 2006. We had 2,812 complaints andrequests from March 2007 to March 2008. Viewing the opinions we received as valuable information for COOP Insurance, we use the feedback to improve our products and business operations.

3

New Education and Training Started~ 41,954 Persons Completed the Basic Essential Training for CO-OP Insurance ~In fiscal 2007, new education and training started for personnel in charge of CO-OP Insurance. This new effort
was begun to enhance protection for policyholders based on the “Implementation Standards for Securing
Proper Development of the Mutual Insurance Business” prepared at the Cooperative Insurance Meeting
attended by the co-ops who are members of the Japan Cooperative Insurance Association Incorporated.
As of March 20, 2008, education and training was conducted by 115 member co-ops (including six cooperative unions) in Japan. 41,954 persons completed the education and training course, and received thecertification issued by the JCCU.

04

Annual Report 2008

4

A Survey Was Made of Benefit Payments
The JCCU conducted a survey of CO-OP Insurance benefit payments, and submitted a report to the Ministryof Health, Labour and Welfare on January 18, 2008.
The JCCU has positively encouraged policyholders of CO-OP Insurance to ask for benefit payments to bemade through the co-op they joined. Recently, however, it was found that additional benefit payments
should be made for the amount of 14,375,400 yen in 233 cases. The JCCU deeply apologizes to policyholders
for the inconvenience. We finished making the additional payments on March 17, 2008.
After examining the causes of the underpayment and reflecting on the incident, the JCCU is determined toprevent any recurrence to ensure that CO-OP Insurance can retain the full confidence of its policyholders.
Details of The investigation results are available on the following website.
◎http://jccu.coop/kyosai/info_080118.shtml

5

Insurance Payment Evaluation Committee Holds Meetings
The Insurance Payment Evaluation Committee, which is attended by experts from outside the JCCU including
attorneys and member Co-ops, holds meetings to examine the payment of benefits and submits
recommendations on how to improve the benefit payment procedure and operations. Meetings were held
seven times in fiscal 2007.
Based on recommendations made at these meetings, the JCCU revises its account books and updates thecontents of its website from time to time.

6

We visited policyholders in areas having damaged from earthquake or theother disasters to express sympathy and invite requests for claims payment.
We visited policyholders in areas having big damage by The Noto Peninsula Earthquake in 2007 andNigataken Chuetu-oki Earthquake in 2007 to express sympathy and invite requests for claims payment incooperation with member co-ops of the areas and the neighborhood areas.
We had words of gratitude from many members.

Japanese Consumers' Co-operative Union 05

Topics in fiscal 2007

7

CO-OP Insurance Website Improves Its Information
In response to a comment from a policyholder saying, “I have no idea of how to submit an application for
payment of insurance under CO-OP Insurance,” the JCCU published a “Guidebook on Requesting Payment ofBenefits” on the CO-OP Insurance website in October 2007.
In the “Guidebook on Requesting Payment of Benefits,” how to request payment of benefits and other mattersare explained in an easy-to-understand way using charts.

Guidebook on Requesting
Payment of Benefits.

8Life-Planning Activities Are Conducted Across the Country !
Our Life-planning activities of training sessions on revising lifestyles and workshop are well received.
Training sessions on revising lifestyles had 9,645 participants, which is 44% expands compared with fiscal
2006 and workshop had 991 visitors.
The Group of LPA*, Co-op Hiroshima, received the “Fiscal 2007
Organization of Distinguished Achievements in Diffusing Financial
Knowledge” award from the Financial Services Agency and the Bankof Japan.
* LPA : Life-Plan-Advisor

06

Annual Report 2008

9

The JCCU Makes Preparations to Establish A New Consumers’ Co-operative
Union Specializing in the Mutual Insurance Business◆The Consumers’ Co-operative Society Law (Co-op Law) Was Revised
The CO-OP Insurance is an approved co-op that operates in accordance with the provisions of the Co-op Law.
The revised Co-op Law took effect in April 2008. The mutual insurance business was revised to enhanceprotection for policyholders. The JCCU and its member co-ops that handle CO-OP Insurance products will
improve their business operations in accordance with the intention of the revision of the Law from now on sothat policyholders may continue their mutual insurance contracts without any concerns.

◆A New Consumers’ Co-operative Union Specializingin the Mutual Insurance Business Will be EstablishedThe revised Co-op Law prohibits unions from handling mutual insurance and any co-op conducting mutual
insurance as the direct insurer with total mutual insurance premiums in excess of 1.0 billion yen from doing
business other than mutual insurance (restrictions on simultaneous conduct of mutual insurance and otherbusiness.) The JCCU and co-ops conducting mutual insurance as direct insurers simultaneously conduct “jointpurchase, individual delivery service, and sales at co-op stores, etc.” and “mutual insurance.” Therefore, the
JCCU and these co-ops are now preparing to establish a new consumers’ co-operative union specializing inmutual insurance (hereinafter, the “New Union” as a tentative name) to continue its mutual insurance
business. The New Union will be established with capital jointly contributed by the JCCU and its member coops.
Entry to the New Union is scheduled to be approved at a meeting of the representatives of member co-ops
and then a permit will be obtained from the Ministry of Health, Labour and Welfare. The CO-OP Insurance
business will then be transferred to the New Union possibly in March 2009. We will notify every policyholder.
We will also give notice to member customers on our website in due course.
◎http://jccu.coop/kyosai

Items Not Changed under the New Union
・ The particulars and insurance premiums will not change. Current contracts remain unchanged.
・ Contacts for policyholders will be the same co-op as before and the same member of staff as before.

Items Changed under the New Union
・ New insurance products may be developed since all co-ops across the country are joining the same New
Union.
・ The New Union will become the direct insurer. A new certificate of mutual insurance will be issued after thecurrent contract is transferred to the New Union.

Japanese Consumers' Co-operative Union 07

Co-op, JCCU and CO-OP Insurance
Co-op is the Largest Consumer Organization in Japan
Co-op was established based on the Consumers' Livelihood Co-operative Society Law, which came into effect in1948. Co-op is an organization wherein Co-op members are free to join or cancel their membership. The
organization aims to enhance the everyday lifestyles of members through co-operation. Members paying into theorganization make up the organization's principle operations.
Co-ops are comprised of retail Co-ops (regional Co-ops, institutional Co-ops, school teachers' Co-ops anduniversity Co-ops), health Co-ops, insurance Co-ops and housing Co-ops.
These organizations base their operations on close ties to the lifestyle of members and make up Japan's largest
consumer organization.

JCCU is the Association for Co-ops in Japan
JCCU (Japanese Consumers' Co-operative Union) was established when Co-ops united in March 20, 1951 in order torealize a better lifestyle for its members.
JCCU positions its product supply business and CO-OP Insurance business as its cornerstone operations. For the
product supply business JCCU works to improve and develop CO-OP brand products in order to supply thenationwide network of Member Co-ops with better products. While aligning itself with Member Co-ops, JCCU works
to ensure the safety of food products from the perspective of consumers.
Furthermore JCCU ensures the rights of consumers and is undertaking environmental and social welfare activities.

Member Co-ops and JCCU are Independent Entities
Member Co-ops and JCCU are both independent entities and conduct operations and management accordingly.
While there are personnel exchanges between Member Co-ops and JCCU, this is by no means an indication of ahead-branch office relationship.

JMember Co-ops' Structure of JCCU
Prefectural Unions of Consumer
Co-op Associations

Retail Co-ops

Regional Co-ops
Regional Co-ops formed by consumers
from a specified area

Health Co-ops
Nationwide Co-op Associations

Co-op Associations Conducting
Operations Covering More Than
Two Prefectures

Agricultural and Fishery Co-ops

08

Annual Report 2008

Owning hospitals and clinics,
conducting medical, health andelderly welfare activities

Insurance Co-ops,
Housing Co-ops
Insurance Co-ops:
Offering insurance businessHousing Co-ops:
Selling of subdivisions and rental
housing businessInstitutional Co-ops
Co-ops formed by employees at the same
workplace

School Teachers' Co-ops
Co-ops formed by teachers and school
employees at elementary, junior highschools and high schools

University Co-ops
Co-ops formed by teachers and studentsof universities

Types of CO-OP Insurance
CO-OP Insurance Tasukeai− Medical Insurance

CO-OP Insurance i.-Plus− Term Life Insurance up

This insurance provides comprehensive coverage for outpatientcare due to accident, hospitalization, surgery, death, disability,
family members' death of the insured, and damage to residences
caused by fire or other perils. It is designed to meet the Co-op
members' demands for coverage that is essential to their daily
lives at a reasonable premium.
There are four plans for women, for children, mainly to cover
medical, and uniform medical and death cover.

This insurance simply provides cover for death, which can be
added cancer, hospitalization, and surgery of the insured. The
maximum sum insured is ¥20 million in death benefits for areasonable premium. Added coverage is available by combining
i.-Plus with Tasukeai. The contract term is 10 years and thepremium varies according to the age and sex of the insured.
Coverage may be extended until the member reaches the ageof 85 with the ¥20 million plan extendable up to age 70.

CO-OP Fire Insurance

CO-OP Insurance New i.i.
− Life InsuranceThis insurance provides coverage against damage to residences
caused by a wide range of perils including fire, lightning,
explosion, aircraft or vehicle crashes into residences, windstorm
and flood, flooding from a third party residence, unexpected
damage from a third party and earthquakes etc.

Basic plan that provides cover for death with the rebate plan canbe matched up with medical cover and women’s health cover.
The contract term is renewable after five years with the option ofa rebate after the five years. Coverage may be extended until themember reaches the age of 80.
◎CO-OP Insurance i.i. was stopped offer.

Insurance Products Uniform throughout Japan
CO-OP Insurance is mainly sold by retail Co-ops. JCCU and Member Co-ops form the CO-OP Insurance Group for joint
operations. CO-OP Insurance offers the same cover across Japan. As of March 20, 2007, 151 Member Co-ops offered
CO-OP Insurance Tasukeai.

Direct and Indirect Insurance Products Offered
CO-OP Insurance offers direct and indirect insurance products. Direct insurance products are offered by JCCU andMember Co-ops approved by the Ministry of Health, Labour and Welfare or local government bodies. CO-OP
Insurance direct insurance products are Tasukeai and i.-Plus.
For insurance not covered by direct insurance products, CO-OP Insurance forms alliances with ZENROSAI * andproperty and casualty insurance firms to offer indirect insurance products.
CO-OP Fire Insurance and CO-OP Life Insurance New i.i. are offered as indirect insurance products.
* ZENROSAI is Japan's largest workers and consumers insurance cooperative organization recognized by the Co-op Law. ZENROSAI is amember organization of JCCU. ZENROSAI and JCCU work together to provide a full line-up of CO-OP Insurance.

Japanese Consumers' Co-operative Union 09

Payment of Claims
Payment of Claims
Payment of claims, excluding that for CO-OP Fire Insurance, is made by JCCU via Member Co-ops or the CO-OP
Insurance Center. (Payment of claims for CO-OP Fire Insurance is made by ZENROSAI.) Upon receiving a claim
request, we check the contract details and ask the policyholder for details about the request and then send thenecessary materials. CO-OP Insurance values swift and efficient payment procedures from the viewpoint ofpolicyholders. For example, basic information is printed on payment claims documents in advance, and someprocedures are simplified depending on the claim details and amount.
CO-OP Insurance shortens the time from the reception of a claims request to payment in order to enhance
policyholder satisfaction.
We also established the Insurance Payment Evaluation Committee in June 2006.

Flow of Claims

1 Reporting Occurrences
Call Centerout
2 SendingDocuments for Claims

3 Sending out Documents for Claims
Policyholder( Beneficiary )CO-OP Insurance
Business Center

4 Payment and Sending out Notice of Payment※This flowchart is standard case of Participating Co-ops in Call center,

Consignment Co-ops, and Joint payment’s Co-ops.

Relief Money to Victims of Devastating Disasters
In the CO-OP Insurance plans, Tasukeai, i.-Plus and i.i. policyholders receive Relief Money in accordance with the COOP Insurance Regulations on Devastating Disaster Relief Money. These regulations were made with the aim ofproviding a token of our sympathy to victims of devastating disasters. JCCU annually allocates money from CO-OP
Insurance surpluses to the Devastating Disaster Relief Money Fund in order to make payments in time of a massive
disaster. CO-OP Insurance offers special assistance in accordance with the magnitude of a natural disaster. In theevent of a devastating disaster occurring wherein policyholder are eligible for claim payment and Relief Money,
Member Co-ops across the country cooperate in order to ensure swift and certain payment so that the burden on
policyholder may be alleviated even slightly.

10

Annual Report 2008

Compliance and Policy on solicitation
Risk Management
Risks associated with insurance businesses include asset management risks, office work risks, and system risks.

(1) Asset Management Risks
As for asset management risks, in compliance with the Co-op financial regulations and other rules, we haveestablished the Insurance Business Asset Management Committee, and formed the insurance business asset
management regulations and the policy for managing the asset management risks in order to ensure proper
management.

(2) Insurance Risks
We manage insurance risks with due consideration of business stability; for example, we pay attention to achieve theproper insurance payment rate when developing and revising products.

(3) Office Work Risks and System Risks
We are striving to prevent accidents in clerical tasks as well as in the development and management of systems by
establishing the Behavior Rules to Prevent Serious Accidents and the Information Security Policy.

(4) Strengthening of Risk Management System
From January 2007, we have been working on the establishment of the comprehensive risk management system tostrengthen risk management by creating the Risk Management Department. In January 2008, we reorganized the
Risk Management Department to Risk management department and Compliance promotion department. In
addition, we placed the person who checks legal documents specially.

(5) Implementation of Check by the Mutual Accountant
We have checked accounting to make sure of healthy mutual business under the Mutual accountant Law that isprovided by Japan Cooperative Insurance Association Incorporated (JCIA).

Compliance(1) Payment of Claims and Policy on solicitation
The JCCU CO-OP Insurance Business Center has the CO-OP
Insurance Solicitation Policy based on the Law on Sales ofFinancial Products.

(2) Enhancement of important information declaration" Declaration of Important Information
We have the easy-to-understand Declaration of Important
Information, which is placed on advertisements and othermaterials so that consumers can correctly understand thecontract outline before joining.

" Protection of Personal Information
As for the protection of personal information, we have the Regulations on Personal
Information and analyze risks concerning personal information protection and prevent
accidents. For the details about the Regulations on Personal Information of the JCCU
CO-OP Insurance Business Center, please visit the website of CO-OP Insurance(http://jccu.coop/kyosai).

Japanese Consumers' Co-operative Union 11

Compliance and Policy on solicitation

Business operations based on policyholder feedback(1) Opening of the consultation center for handling complaints
CO-OP Insurance, when developing products and paying claims, is making improvements based on policyholder
feedback. In order to receive more feedback and reflect the opinions in our business, we established the consultation
center, which is dedicated to handling complaints, opinions, and requests in 2006.

" Complaints we received at the consultation center in 2007
We had 2,812 complaints and requests in fiscal 2007. Viewing the opinions we received as representing the voice ofour policyholders, we are striving to improve the problems.

(2) Improvement efforts resulting from complaints and opinions we receive
We have introduced the management system to unify the management of complaints and opinions we receive sothat related departments can share and swiftly resolve any issues. In addition, we report all complaints and opinions
to all departments once a week.

Policy on solicitation
Based on the Law on Sales of Financial Products, JCCU has established the following CO-OP Insurance Solicitation
Policy. These guidelines are posted visibly at the JCCU CO-OP Insurance Business Center and at Member Co-ops
handling CO-OP Insurance. CO-OP Insurance sales personnel carry the guidelines in an all out effort to bolster
compliance.

JCO-OP Insurance Solicitation Policy
Notification to all members
Based on the Law on Sales of Financial Products, we have established the following CO-OP Insurance
Solicitation Policy.

1. When offering CO-OP Insurance, every effort will be made to comply with the Co-op Law, the Law on
Sales of Financial Products and the Consumer Contract Act to provide services in an appropriate
method.

2. When offering CO-OP Insurance, every effort will be made to ensure members fully understandproduct content and other important information.

3. When offering CO-OP Insurance, every effort will be made to respect the wishes of members, nottake up excessive amounts of members' time or space.

4. When a claim is made, every effort will be made to ensure swift settlement.
5. Recognizing the importance of protection of privacy, contract information will be managed
stringently and appropriately.
6. Every effort will be made to gather member opinions and reflect these on future CO-OP Insurance
development and in offering CO-OP Insurance.

12

Annual Report 2008

International activities and L PA
International Cooperative and Mutual Insurance Federation (ICMIF)
Throughout the world there are many types of Cooperative Societies (Co-ops) and mutual insurance institutions. As
of August, 2008, 200 organizations from 72 countries were members of the International Cooperative and Mutual
Insurance Federation (ICMIF) of the International Cooperative Alliance (ICA). In 1922 an insurance committee of the
ICA was established paving the way for today's ICMIF. The ICMIF undertakes a range of activities for thedevelopment of cooperative insurance organizations. Such activities include surveys, research and development.
JCCU became a member of the ICMIF in 1993.
In 1993 JCCU joined the ICMIF, and since 2004 JCCU has had a staff member
working there to provide support. Furthermore, in and after June 2006,
Yoshihiko Ito, JCCU Executive Director, has been actively participating in ICMIF
management as a member of its Intelligence Committee.
For further information refer to the ICMIF: http://www.icmif.org/

Life-Planning Activities
Life-Planning activities enable Co-op members to learn about money matters in their lives. In the principle topic of
Revising Coverage, members gain the capability to independently select insurance that is really necessary.
As an integral part of Life-Planning activities, JCCU is training members and Co-op staff to be Life-Plan-Advisor(LPA). Participants of LPA courses learn about life planning, insurance, taxation and finance in comprehensive
lectures held by JCCU in order to become LPA. As of March 20, 2008 there are 2,054 advisors active at Member Coops across Japan.
Co-op carries out the following Life-Planning activities:" Lectures on Revising Coverage" Training sessions on revising lifestyles" Life-planning lectures" Individual consulting" Activities for revising lifestyles at home (Workshop of life-plan)

Developments in Life-Planning Activities
Life-Planning activities havenow become firmly established

Participants in Life-planning Activities

Number of participants

20,00018,822
Fiscal 2006

16,447

as Co-op activities. In fiscal

Fiscal 2007

15,0002007, more than 44,000 people
in total participated in the

12,296
11,262

activities, principally in revisionof coverage.

9,645

10,000

6,714
5,000

3,354

2,408
554

991

0
LectureTraining sessions

Life-planning lectures

Individual consulting

Workshop

Japanese Consumers' Co-operative Union 13

Health and Welfare
Health Improvement Activities
A fundamental issue for JCCU activities is the improvement of the health and welfare of people. From the position ofassisting members and policy holders to improve their health, JCCU has installed automatic blood pressure
measuring devices at Co-op stores and offers free health consultations by phone.

(1) Automatic Blood Pressure Measuring Devices Installed
JCCU has installed automatic blood pressure measuring devices at about 426 Co-op stores throughout Japan. Since
managing blood pressure is paramount for preventing all lifestyle-related illness, it is essential to consistently
measure blood pressure from day to day. Members are welcome to test their blood pressure level while shopping,making the devices very useful for managing their day to day health.

(2) CO-OP Insurance Health Call Center
JCCU offers a free phone consultation service made available to Tasukeai,i.-Plus, i.i., and New i.i. policyholders. JCCU contracts specialist counselors
including doctors and nurses from governmental corporation to give
advice on health, treatment and care-giving as well as instruction onwhich medical facility to use. During fiscal 2007 the call center fielded
60,895 calls for advice.

Welfare Activities
Since 1996, CO-OP Insurance has been assisting Co-ops all over Japan to carryout their welfare activities through the Co-op Welfare Activity Organization. A
variety of activities are carried out including Child-rearing support,
Communication center activities, activities to foster communication throughdinners and meal deliveries and activities for helping lifestyles. These activities
have led to alliances being formed with other organizations and local
government bodies to create regional networks.
In fiscal 2007, JCCU contributed a total of ¥24 million in assistance for 67 welfare activities of 38 Member Co-ops.
Breakdown of fiscal 2007
Application by activities

14

Activities

Amount application

Child-reading support

25¥ 9,540,700

Communication center activities

15

4,920,000

Activities to foster communication through dinners
and meal deliveries

15

4,961,500

Other welfare and volunteer activities

12

4,896,635

Total

67

¥ 24,318,835

Annual Report 2008

Fiscal 2007 CO-OP Insurance
Business Overview
Overview of the financial results of the CO-OP Insurance business is as follows:

End of year policyholders totaled 6,677,739
When broken down by product, Tasukeai policyholders increased 5.1% from the previous year to 5,547,769, i.-Plus
policyholders increased 22.7% to 718,080, CO-OP Fire Insurance policyholders increased 3.9% to 357,613, i.i.
policyholders decreased 16.4% to 48,113 and new types of CO-OP Insurance “New-i.i. ” policyholders is 6,164.

Insurance in force totaled ¥ 9,172 billion
CO-OP Insurance Group has total policies of ¥9,172 billion of direct insurance in force, an increase of 8.2%* on theprevious year. Of this amount, JCCU directly insured policies increased 14.9%* to ¥6,504 billion.

Premiums totaled ¥ 128,207 million
CO-OP Insurance Group has total premiums of ¥128,207 million, an increase of 10.5% on the previous year. Of thisamount, JCCU direct insurance premiums increased 17.1% to ¥85,950 million.

1,015,710 payments made
CO-OP Insurance Group made a total of 1,015,710 payments, an increase of 14.4% on the previous year.

¥ 48,764.9 million in payments made
CO-OP Insurance Group has made a total of ¥48,764 million in payments for insurance claims, an increase of 8.7% on
the previous year. Of this amount, JCCU claim payments increased 13.6% to ¥32,005 million.
* CO-OP Insurance Group denotes JCCU and 35 Member Co-ops that directly insure CO-OP Insurance. Refer to Page 8, about directand
indirect insurance.

Asset Management
Fundamental Policy for Asset Management" JCCU maintains its fundamental policy of safe and efficient management of funds, in accordance with the special
characteristics of the funds policy holders left in keeping.
" Based on the Regulations on Co-op Financial Administration and enforced internal rules corresponding to theRegulations, JCCU places great importance on security when managing assets.
" JCCU regularly ascertains and manages price fluctuation risk and credit risk concerning asset management.
Every effort is made to prevent the unpredicted losses from asset management.
" JCCU acknowledges the special characteristics of insurance funds and mainly invests in Japanese Government
Bonds and deposits for short-term funds, and mostly bonds with a mixture of stocks and foreign securities inorder to improve profitability for long-term funds.
" In fiscal 2007, based on this fundamental policy, JCCU makes much of safety, and JCCU has created an asset
management structure aiming to secure stable profitability over the medium and long term.

Japanese Consumers' Co-operative Union 15

Fiscal 2007 CO-OP Insurance Business Overview

CO-OP Insurance Tasukeai
04

CO-OP Insurance i.-plus

4,937,630

5,547,769

08

Year ended March 20,

Number of Policies
Amount Insured (¥ billions)
Premium Income (¥ millions)
Claims Paid (¥ millions)

2007

2008

5,276,661¥ 6,243¥ 96,309¥ 39,741

5,547,769¥ 6,426¥ 103,468¥ 42,140

585,15407

718,08008

Year ended March 20,

2007

2008

Number of Policies
Amount Insured (¥ billions)
Premium Income (¥ millions)
Claims Paid (¥ millions)585,154¥ 2,224¥ 19,663¥ 5,096

718,080¥ 2,745¥ 24,739¥ 6,624

CO-OP Insurance i.i.

CO-OP Fire Insurance

335,09206

57,602

07357,61308

61,39606

343,96207

63,74405

326,733

05

65,19704

316,33804

443,82306

5,276,661

07

328,46805

4,567,642

06

244,600

04

4,166,463

05

48,11308

Year ended March 20,

2007

2008

Year ended March 20,

2007

Number of Policies

343,962357,613

Number of Policies

57,602

48,113

Premium Income (¥ millions)¥ 5,231¥ 5,564

Premium Income (¥ millions)¥ 8,315¥ 7,126

Claims Paid (¥ millions)¥ 1,398¥ 1,064

Claims Paid (¥ millions)¥ 8,113¥ 7,160

CO-OP Insurance New i.i.
08

Year ended March 20,
6,164

2008

Number of Policies

6,164

Premium Income (¥ millions)¥ 553

Claims Paid (¥ millions)

Investment Assets

2008

¥6
Thousands of
U.S. dollars *2

Millions of yen *1

As of March 20,

2006

2007

2008

Changes

2008

Cash and deposits¥ 25,488¥ 25,512¥ 22,166(-0.1%)$ 222,282

Long-term deposits

1,500

1,500

1,500

(0.0%)

15,042

Money held in trust *3

8,000

9,500

13,500(+42.1%)

135,379

Bonds

18,27327,14043,409(+59.9%)435,308

Equities

2,445

3,077

2,346

(-23.8%)23,525

Foreign bonds *4

2,421

2,179

1,517

(-30.4%)

15,212Foreign equities

1,103

1,158

1,483

(+28.1%)

14,871Other securities *5
Total

7,183

9,079

6,678

(-26.4%)

66,967¥ 66,414¥ 79,147¥ 92,603(+17.0%)$ 928,630

1. Yen Amounts are rounded down to the neares ¥ 1 million.
2. U.S. dollar amounts are translated, for convenience only, at ¥ 99.72 = US$1.00, the rate prevailing on March 20, 2008, and rounded down to the nearest $1 thousand.
3. Money held in trust are transferable warranty deposits.
4. A portion of foreign securities in foreign currencies are hedged.
5. Other securities are consist of investment trusts in which volatilities are suppressed.

16

Annual Report 2008

Balance Sheet
As of March 20,
Thousands of
U.S. dollars*2

Millions of yen*1

Assets

2007

2008

2008

¥ 25,266¥ 21,967$ 220,286

Securities

35,851

48,308484,436

Account receivables

3,982

5,172

51,865

Advanced payables

1,324

1,206

12,093Current assets:
Cash and deposits

Other current assets

67

340

3,409

Total current assets

66,49376,996772,121

Fixed assets:
105

118

1,183

1,990

2,482

24,889Long-term deposits

1,500

1,500

15,042Long-term securities

17,02921,326

213,858

Acquisition of assets
Intangible assets
Other fixed assets:

286

2,062

20,677

18,816

24,902249,719

Total fixed assets

20,91227,502

275,792

Total assets¥ 87,405¥ 104,488$ 1,047,813¥ 4,639¥ 4,579$ 45,918

Other

Liabilities and Capitals
Liabilities:
Current liabilities:
Reserves for policy contract:
Reserves for claims paid
Premium receivables

3,828

4,760

47,733

Reserve for premium income

8,264

10,827

108,574

Reserve for risks

1,995

7,880

79,021

11,053

14,688147,292

29,78142,736

428,559

Accounts payable

2,645

2,734

27,416

Accrued income taxes

2,855

3,214

32,230

Other current liabilities

1,099

1,348

13,517

Total current liabilities

36,38250,034

501,744

705

682

6,839

¥ 37,087¥ 50,717$ 508,594

Voluntary reserves

34,06838,010381,167

Unappropriated surplus for the period

16,24915,464

155,074

Total capitals

50,31753,770539,209

Total liabilities and capitals¥ 87,405¥ 104,488$ 1,047,813

Reserve for rebate payment

Fixed liabilities:
Reserve for employee retirement benefits
Total liabilities
Capitals:

1. Yen Amounts are rounded down to the nearest ¥ 1 million.
2. U.S. dollar amounts are translated, for convenience only, at ¥ 99.72 = US$1.00, the rate prevailing on March 20, 2008, and rounded down to the nearest $1 thousand.

Japanese Consumers' Co-operative Union 17

Income statement
For the years ended March 20,
Thousands of
U.S. dollars*2

Millions of yen*1

2007

2008

2008

¥ 73,355¥ 85,950$ 861,913

668

541

5,425

Fees and commissions receivables

2,395

2,610

26,173

Reversal to reserve for claim paid

−

299

2,998

Reversal of reserves for claim rebate

760

1,841

18,461

Investment income

710

483

4,843

77,89091,727

919,845

170

218

2,186

Claims paid

28,17232,005

320,948

Premium paid

825

804

8,062

1,218

2,650

26,574

581

0

0

4,016

9,226

92,51915

1,187

11,903

34,83045,874460,028

Other ordinary expenses

21,222

24,611

246,801

Ordinary surplus

22,00821,460215,202

Other income

204

177

1,774

Other expenses

22

82

822

Extraordinary income (expenses)−16−1,456−14,600

Transfer to resreve for claim rebate

4,063

5,477

54,923

Surplus before taxes

18,111

14,622

146,630

Corporate and other taxes

2,846

3,240

32,49015,265

12,109121,430

Net surplus for the year

752

778

7,801

Extraordinary withdraw

231

2,575

25,822¥ 16,249¥ 15,464$ 155,074

Ordinary income:Premium income
Insurance receivables

Other ordinary income

Ordinary expenses:

Insurance paid backTransfer to reserve for claim paid
Transfer to policy reserve
Investment expenses

Net surplus

Unappropriated surplus for the year

1. Yen Amounts are rounded down to the nearest ¥ 1 million.
2. U.S. dollar amounts are translated, for convenience only, at ¥ 99.72 = US$1.00, the rate prevailing on March 20, 2008, and rounded down to the nearest$1 thousand.

18

Annual Report 2008

Solvency Margin Ratio and others
Thousands of
U.S. dollars*2

Millions of yen*1

Solvency margin ratio*3

2007

2008

Changes2008¥ 48,350¥ 76,541¥ 28,191$ 767,559¥ 10,161¥ 11,506¥ 1,345$ 115,383

951.7%

1,330.5%+378.8pt

1. Yen Amounts are rounded down to the nearest ¥ 1 million.
2. U.S. dollar amounts are translated, for convenience only, at ¥ 99.72 = US$1.00, the rate prevailing on March 20, 2008, and rounded down to the nearest$1 thousand.
3. The above ratio is calculated on the basis of the solvency margin ratio described in the Countermeasures for Individual Issues related to the Protectionof cooperative insurance contractors, which was put together at Consumer's cooperative insurance round-table conference composed of members
from Japan Cooperative Insurance Association Incorporated.
4. The total solvency margin is limited to what can be divided in the CO-OP Insurance enterprise.

Thousands of
U.S. dollars*2

Millions of yen*1

Breakdown of Basic Profit

2007

2008

Changes

2008

Basic profit*4¥ 22,971¥ 28,755¥ 5,784$ 288,357

Investment profit*3

16

−43

−59

−431

Moratality profit*3

22,23328,132

5,899

282,109

Expense profit*3

721

666

−55

6,678

1. Yen Amounts are rounded down to the nearest ¥ 1 million.
2. U.S. dollar amounts are translated, for convenience only, at ¥ 99.72 = US$1.00, the rate prevailing on March 20, 2008, and rounded down to the nearest$1 thousand.
3. Definitions are as follows:
Investment profit : Differential between the projected investment return (expected yield) and the actual investment return.
Mortality profit : Differential between the projected insurance payment (expected mortality rate) and actual claims for payment.
Expense profit : Differential between the projected operational expenses (projected operational expense ratio) and actual operational expenses.
4. Basic profit is calculated by excluding capital gain/loss, such as sales gain or loss on marketable securities, and extraordinary gain/loss, such asprovision for contingency reserves, from recurring surplus. It is the index that shows the basic period income generated from the mutual aid enterprise.

Thousands of
U.S. dollars*2

Millions of yen*1

Equity Capital Ratio

2007

2008

2008

¥ 50,317¥ 53,770$ 539,209

1,995

7,880

79,021

52,31361,651

618,241¥ 87,405¥ 104,488$ 1,047,813

57.5%

51.4%

59.8%

59.0%

1. Yen Amounts are rounded down to the nearest ¥ 1 million.
2. U.S. dollar amounts are translated, for convenience only, at ¥ 99.72 = US$1.00, the rate prevailing on March 20, 2008, and rounded down to the nearest$1 thousand.
3. Equity capital ratio = Equity capital ÷ Total assets
4. Revised equity capital ratio = Revise equity capital ÷ Total assets

Japanese Consumers' Co-operative Union 19

Structure of CO•OP
Insurance Business Center
as of March 20, 2008

Corporate Officer(Planning and businesspromotion)

CO-OP Insurance
promotion division

Business planningdepartment
Business promotion
department
LPA promotion
department

Executive Director(CO-OP Insurance)

CO-OP Insurance
planning division

Management planningdepartment
CO-OP Insurance
developing department
Public relations
department

CO-OP Insurance
Business Center

Corporate Officer(Management of
insurance)

CO-OP Insurance
management division

Accounting department

General affairs
department
Management planningdepartment

CO-OP Insurance
administrative divisioninternal control
preparatory officeDirectors andemployees Welfare
management office20

Annual Report 2008

Claim payment
department 1
Claim payment
department 2

New Union
establishment
preparatory officeBusiness operating
department

Risk management
department

Contract management
department

Compliancepromotion department

Call center

Directors' andemployees' insurance
department Businessadministrative group

Member feedback
promotion office

JCCU at a Glance
Japanese Consumers' Co-operative Union (JCCU)
President : Toshifumi Yamashita
Established : March 20,1951
Member Co-ops : 499 as of March 20,2008
Capital : ¥ 8.9billion as of March 20,2008
Amount of supply : ¥399.4 billion for fiscal 2007

Details of operations
1. Improvement and development of CO-OP brand products, supplying business and mail-orderbusiness to Member Co-ops with products, Inspection of the products etc.
2. CO-OP Insurance business, welfare business, travel business.
3. Instrction, communication and adjustment for businesses and member activities performed in themember Co-ops etc.
4. Planning and promotion of food safety, environment, welfare, consumer's affairs etc.
5. Support activities and communication with foreign Co-ops, participation in international meetingsetc.
6. Administration of health Co-ops, school Teachers’ Co-ops, and Institutional Co-ops
Fiscal Year:
March 21 through March 20 of the following year
Branches:
Ebetsu-city Hokkaido; Sendai-city Miyagi; Saitama-city
Saitama; Shibuya-ku Tokyo; Shinjyuku-ku Tokyo;
Nagoya-city Aichi; Osaka-city Osaka; Okayama-city
Okayama; Fukuoka-city Fukuoka;
Products inspection center (Warabi-city Saitama);
CO-OP Insurance Business center (Urayasu-city Chiba)
Subsidiaries:
CO-OP Trade Japan Inc.
CX Inc.
CO-OP Publications Ltd.
I & I Service Inc.
CO-OP Trade America Inc.
CO-OP Clean lnc.
CX Cargo Inc.
CX Infonet Inc.
World Club Inc.
Affiliate Company:
National School Supplies Inc.
JCCU corporate pension fund
JCCU health insurance society
Research Institution:
Consumers' Co-operative Institute of Japan (CCIJ)

Japanese Consumers' Co-operative Union 21

Japanese Consumers' Co-operative Union
CO-OP Insurance Business Center
1-5-2 Irifune Urayasu Chiba 279-8588 JAPANTEL :+81-47-351-3356
FAX:+81-47-351-5298
http://jccu.coop/kyosai

This annual report uses recycled paper andis printed with soy bean ink.