Aflac says Japan sales face minimal impact

AP News
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Posted: Mar 14, 2011 9:24 AM
Aflac says Japan sales face minimal impact

Aflac Inc., a U.S.-based insurance company that sells health and life insurance to one out of every four people in Japan, said Monday that its Japanese sales will likely face only a minimal impact from the earthquake and tsunami there.

Early estimates for the losses for insurers and reinsurers around the globe are ranging from $10 billion to $50 billion.

"We remain ready to respond to the needs of our policyholders by paying claims swiftly, and will prioritize our response to those in the affected areas," Aflac Japan President and Chief Operating Officer Tohru Tonoike said in a statement.

Nonetheless, its shares fell $2.30, or 4.1 percent, to $53.25 in pre-market trading.

Aflac, based in Columbus, Ga., said it is the biggest insurance company in Japan in terms of individual policies in force. But the company said less than 5 percent of Aflac Japan's new sales and in-force premiums come from the hard-hit Iwate, Miyagi and Fukushima prefectures there.

Aflac Japan's main offices, which include corporate offices in Tokyo and operational centers in Tokyo and Osaka, did not incur any damage and are fully operational. The company said all of Aflac Japan's workers are safe. Aflac said it continues to reach out to its independent sales force to assess their needs.

Two of Aflac Japan's 82 sales offices, both in the same building in Sendai, have minimal damage. They will be closed temporarily due to power outages.

On Friday Aflac CEO Dan Amos said he expected the number of claims to be high, but that the company was well prepared to cover them. He was scheduled to fly into Japan on Sunday.

Aflac said its 2011 operating earnings will be at the low end of its 8 percent to 12 percent range for growth, excluding the impact of currency.

In February the company said it expected full-year adjusted earnings of $5.97 per share, excluding the impact of the dollar-yen exchange rate. At the time Aflac said its reported earnings would likely come in between $6.09 and $6.34 per share if the yen remained strong.