Press Conference by the Commissioner

(Excerpt)

May 26 , 2003

Q.

We understand that a scope of the draft revision of the Insurance Business Law on lowering guaranteed interest rate is an insurance company which has a probability of difficulty in continuing its business. Will you tell us the minimum extent of deterioration in business operations that meets this definition?

A.

Defining the target clearly may be inappropriate and difficult because of harmful rumor and so forth. It may sound rather abstract, but an applicable case is a case that an insurance company does not meet a condition of a bankruptcy, which the company is not in the state that has a difficulty in continuing its business, however it can be reasonably predicted that it may experience difficulty in continuing business in the future, unless it makes an alteration to contractual conditions.

Of course, an insurance company making application for alteration of contractual conditions is required to give a rational explanation of the reason for the application. We will closely examine the case to see if the company meets these conditions, prior to our approval.

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