Over the last three years, Aflac has reinforced its strong brand awareness through Aflac Duck commercials. The advertisements help convey the value of our products to potential consumers and because of a more competitive market, this type of innovative advertising helps Aflac stand out. According to a survey by CM Databank, the commercials for our EVER product that feature the Aflac Duck have been consistently rated as either the number one or number two commercial in the life and non-life insurance category since June 2003.

Our research has suggested that consumers want to choose the most popular policy, and Aflac's is the most preferred among the various medical insurance products available in Japan. We are convinced that our "Number One in Medical" advertising campaign conveys this message and has been an effective means for distinguishing our products from those of our competitors and bolstering our brand image. Along with the quality of our products, we believe effective advertising and branding will reinforce consumers' favorable perceptions of Aflac.

Aflac Japan's use of technology has been a driving force behind its low-cost operations. Our operating efficiency, which is one of our greatest competitive strengths, allows us to offer consumers valuable benefits at affordable prices and compensate our sales force with attractive commissions. Technology has also been instrumental in improving customer satisfaction. The claims processing system we implemented in 2003 has enabled us to reduce the number of days required to pay benefits. On average, in 2005, it took less than two business days to pay a claim from the time it was received from the customer.

Aflac Japan's e-App®, a system similar to the SmartApp® software that is used in the United States, enables sales associates to electronically submit policy applications. This has reduced incomplete and pended forms and shortened our processing time. Application forms submitted via e-App rose from 12% in 2004 to 16% in 2005. The use of e-App has proven to be a positive experience for our customers as well, with some customers noting that it presents a very positive and innovative image.

Another technological innovation is our net billing system. Before the system was introduced, bills were sent to and returned from our payroll accounts by mail. Through net billing, the entire process can be completed over the Internet, which has benefited both payroll accounts and our operations from an administrative standpoint. Approximately 8,000 payroll accounts had adopted the net billing system as of the end of 2005, compared with 5,500 at the end of 2004.

We have also streamlined administrative efficiency by using FOMA, a video mobile phone system, to handle our life insurance products that require a medical interview. FOMA allows us to remotely examine the health condition of a prospective customer in lieu of having a face-to-face interview. This system was the first of its kind in the insurance industry.