To what do you attribute the dramatic turnaround in AFLAC Japan's new sales in 2002?

I think the quick recovery of AFLAC Japan's sales is due to our marketing strategy and to health care reform that is taking place in Japan. In 2001, we spent a large amount of time improving AFLAC Japan's organizational structure and human resource system, particularly in our marketing organization. We hired a new director of marketing and made many other new appointments in the marketing department. And I believe those efforts paid off in 2002. But more than anything else, I think our sales success in 2002 is a reflection of AFLAC's agility. For instance, we reacted quickly to market changes brought about by health care reform. Specifically, when we saw the possibility of greater copayments in Japan, we developed and introduced new medical products that our research had suggested would appeal to consumers. I have said in the past that we are a marketing organization that just happens to sell insurance, and I think our 2002 sales in Japan show that is still the case.

Given Japan's weak economy and the more competitive environment resulting from deregulation, is Japan still an attractive market for AFLAC's products?

I strongly believe that Japan remains a terrific market for us. Although the market is more competitive now than a few years ago, I remain convinced that the company with the best products and the best prices will ultimately win in a deregulated environment. No one doubts we are that company. Not only is Japan a sizable market, but its demographics also make it a very attractive market for our type of products. Japan's aging population creates an opportunity for us because as people age, they are more likely to access the health care system, incurring greater out-of-pocket expenses. As a result, they will be more likely to need insurance products that provide the kind of living benefits that AFLAC's policies offer. That leads us to believe that Japan will be a very good market for our products for many years.

How important is AFLAC's financial strength?

I don't think there is a time when financial strength isn't important. However, it's extremely important now, especially in Japan. In light of that country's decade-long economic difficulties, which in great part have arisen from a troubled financial sector, Japanese consumers are much more knowledgeable about which companies are strong, and they are making a point of doing business with those companies. When consumers hear that Japan's Economist magazine rated us the number one insurance company in terms of reliability, or that Moody's upgraded its rating of AFLAC, they know we are a strong company.

Why has your product broadening strategy been so successful?

Our product broadening strategy has been successful because we are meeting the needs of consumers. I don't think there is any other reason. If our products weren't wanted and needed, they wouldn't be bought. It's that simple. And as we have seen changes in health care in the United States and in Japan, the need for our products has increased. Most importantly, we have developed products by listening closely to the people who will use them as well as those who will sell them.

AFLAC has experienced tremendous expansion of its U.S. sales force. What attracts people to AFLAC?

I think our financial stability and strong name recognition help attract people to our company in the United States. Our advertising campaign has been an overwhelming success, and that has made the AFLAC duck somewhat of a pop icon. The visibility of our brand makes people want to learn more about our products. In addition, people are attracted to AFLAC because the opportunities arising from our competitive commissions and rewards for agent performance are tremendous.

How do you view the opportunities for sustainable sales growth in the United States?

I believe our sales growth in the United States will continue to be strong. The Small Business Administration estimates there are about 5.5 million U.S. businesses with fewer than 500 workers. Yet our market-leading position of about 250,000 payroll accounts translates into a penetration rate of less than 5% in the United States. Expressed another way, the United States has about 137 million workers, which tells us that there are enormous opportunities in the United States. With our strong name recognition and the quality of our products and sales force, we should be able to continue to tap into the U.S. market potential. As such, I believe we can sustain a sales trend of 12% to 15% growth for many years.