美國家庭壽險 (AFL) 2026 Q2 法說會逐字稿

Good day and welcome to the Aflac Incorporated second-quarter 2026 earnings conference call. (Operator Instructions) Please note, this (technical difficulty) is being recorded.

大家好，歡迎參加 Aflac Incorporated 2026 年第二季財報電話會議。(操作員指示) 請注意，本次（技術問題）通話將被錄音。

I would now like to turn the conference over to David Young, Senior Vice President, Capital Markets. Please go ahead.

現在我想把會議交給資本市場資深副總裁 David Young。請開始。

Good morning and welcome. Thank you for joining us for Aflac Incorporated second-quarter 2026 earnings call. This morning, Dan Amos, Chairman, CEO of Aflac Incorporated, will provide an overview of our results and operations in Japan and the United States. Then Max Broden, Senior Executive Vice President and CFO of Aflac Incorporated, will provide more detail on this quarter's financial results, including our capital and liquidity. These topics are also addressed in the materials we posted with our earnings release, financial supplement, and quarterly CFO video update on investors.aflac.com.

各位早安，歡迎各位。感謝各位參加 Aflac Incorporated 2026 年第二季財報電話會議。今天上午，Aflac Incorporated 董事長兼執行長 Dan Amos 將概述我們在日本與美國的業績與營運情況。接著，Aflac Incorporated 資深執行副總裁兼財務長 Max Broden 將進一步說明本季財務結果的更多細節，包括我們的資本與流動性。這些主題也已在我們隨財報新聞稿一併發布的資料中說明，包括財務補充資料，以及在 investors.aflac.com 上發布的季度 CFO 影片更新。

For Q&A today, we are also joined by Virgil Miller, President of Aflac Incorporated and Aflac US; Charles Lake, Chairman and Representative Director, President of Aflac International; Masatoshi Koide, President and Representative Director of Aflac Life Insurance Japan; Shinsuke Morimoto, Deputy President and Director of Aflac Life Insurance Japan; and Brad Dyslin, Global Chief Investment Officer, President of Aflac Global Investments.

今天的問答環節，我們也邀請到：Aflac Incorporated 與 Aflac US 總裁 Virgil Miller；Aflac International 董事長兼代表董事、總裁 Charles Lake；Aflac Life Insurance Japan 總裁兼代表董事 Masatoshi Koide；Aflac Life Insurance Japan 副總裁兼董事 Shinsuke Morimoto；以及全球投資長、Aflac Global Investments 總裁 Brad Dyslin。

Before we begin, some statements in this teleconference are forward-looking within the meaning of federal securities laws. Although we believe these statements are reasonable, we give no assurance that they will prove to be accurate because they are prospective in nature. Actual results could differ materially from those we discuss today. We encourage you to look at our annual report on Form 10-K for some of the various risk factors that could materially impact our results. As I mentioned earlier, the earnings release with reconciliations of certain non-US GAAP measures and related earnings materials are available on investors.aflac.com.

在開始之前，本次電話會議中的部分陳述屬於聯邦證券法所定義的前瞻性陳述。雖然我們認為這些陳述是合理的，但由於其具有前瞻性，我們不保證其將被證實為準確。實際結果可能與我們今天討論的內容存在重大差異。我們建議各位查閱我們的 Form 10-K 年度報告，其中列示了可能對我們業績造成重大影響的各項風險因素。如我先前所提，包含特定非美國 GAAP 指標調節表的財報新聞稿及相關財報資料，均可於 investors.aflac.com 取得。

I'll now hand the call over to Dan. Dan.

接下來我把電話交給 Dan。Dan。

Thank you, David, and good morning, everyone. We're glad you joined us. The second quarter added to the first quarter's solid financial start. Aflac Incorporated reported net earnings per diluted share of $1.63 and adjusted earnings per diluted share of $1.75. These results reflect the focused execution of our strategy, thus creating long-term value for the shareholders.

謝謝你，David，各位早安。很高興各位加入我們。第二季延續了第一季穩健的財務開局。Aflac Incorporated 公布稀釋後每股淨利為 1.63 美元，稀釋後每股調整後盈餘為 1.75 美元。這些結果反映了我們聚焦執行策略，從而為股東創造長期價值。

Starting with Aflac Japan, as we told you, we were up against a strong second quarter in 2025 sales comparison following the launch of Miraito cancer insurance. As a result, sales declined 5.6% to JPY11 billion in the quarter, but sales were up 7% for the first half of the year. This reflected strong sales results of Tsumitas and bring sales in line with our expectations for the first half of the year. As part of our ongoing strategy, we continue to promote the importance of third sector protection to new and younger customers with our innovative first sector savings-type life insurance product, Tsumitas.

先談 Aflac Japan。正如我們先前所說，由於 2025 年第二季在推出 Miraito 癌症保險後的銷售比較基期強勁，我們面臨較高的比較基準。因此，本季銷售下滑 5.6% 至 110 億日圓，但上半年銷售仍成長 7%。這反映了 Tsumitas 的強勁銷售表現，並使上半年銷售符合我們的預期。作為我們持續策略的一部分，我們持續透過創新的第一領域（first sector）儲蓄型壽險產品 Tsumitas，向新客群與年輕客群推廣第三領域（third sector）保障的重要性。

During this quarter, both the refreshed Tsumitas product and Anshin Palette medical insurance product, which we launched in December of 2025, delivered strong sales growth year over year. As a result, we continue to expect Aflac Japan sales to exceed 2025. For the quarter, premium persistency was 92.7%, which was in line with last quarter by maintaining strong persistency while adding new premium through sales, we seek to offset the impact of lapses and reissue as well as policies reaching paid-up status. Our wide-ranging network of distribution channels, including agencies, alliance partners and banks continually leverage opportunities to help provide financial protection to Japanese consumers. We view each channel as a distinct avenue to reach Japanese consumers in different demographics and stages of life.

本季，更新版 Tsumitas 產品以及我們於 2025 年 12 月推出的 Anshin Palette 醫療保險產品，均實現了強勁的年增銷售成長。因此，我們仍預期 Aflac Japan 的銷售將超過 2025 年。本季保費續保率為 92.7%，與上季一致；在維持強勁續保的同時，透過銷售增加新保費，我們力求抵銷解約與復效，以及保單達到繳清（paid-up）狀態所帶來的影響。我們廣泛的通路網絡，包括代理商、聯盟合作夥伴與銀行，持續把握機會，協助為日本消費者提供財務保障。我們將每一個通路視為觸及不同人口結構與不同人生階段日本消費者的獨特途徑。

With this in mind, we evaluate and support each one with unique opportunities to help provide Japanese citizens with financial protection.

基於此，我們評估並支持每一個通路，提供其獨特的機會，以協助為日本民眾提供財務保障。

Turning to Aflac US, we continue to focus on pursuing profitable growth with an eye on maintaining strong underwriting discipline and premium persistency. We generated a 2.6% increase in year-over-year sales in the second quarter. We are seeing momentum within our group business, especially our group voluntary products and network dental and vision.

接著談 Aflac US。我們持續聚焦追求具獲利性的成長，同時著眼於維持嚴謹的核保紀律與保費續保率。第二季銷售較去年同期成長 2.6%。我們在團體業務方面看到動能，尤其是團體自選（voluntary）產品，以及網絡牙科與視力保險。

We generated a 2.3% increase in net earned premium for the quarter and maintain strong premium persistency of 79.4%. At the same time, Aflac US has continued prudent approach to expense management and maintained a solid pretax margin of 20.9%. As public insurance companies, our primary responsibility is to fulfill the promises we make to our policyholders while being responsive to the needs of the shareholders. We continue to be pleased with our investments producing solid investment income.

本季淨已賺保費（net earned premium）成長 2.3%，並維持 79.4% 的強勁保費續保率。同時，Aflac US 持續採取審慎的費用管理方式，並維持 20.9% 的穩健稅前利潤率。作為上市保險公司，我們的首要責任是在回應股東需求的同時，履行對保戶所做出的承諾。我們也持續對投資帶來穩健的投資收益感到滿意。

Our operations generated strong capital and cash flows on an ongoing basis as we remain committed to prudent liquidity and capital management. This financial strength is the foundation that backs up our promise to the policyholders balanced with financial flexibility and tactical capital deployment. I am pleased with the company's financial strength, which supports our capital deployment. We treasure our 43 consecutive years of dividend increases and remain committed to extending this record in 2026, combining share repurchase and dividends we delivered $1.3 billion back to the shareholders in the second quarter and $2.6 billion for the first 6 months. In doing so, we have maintained our position among companies with the highest return on capital and lowest cost of capital in the industry.

我們的營運持續產生強勁的資本與現金流，並且我們仍致力於審慎的流動性與資本管理。這項財務實力是支撐我們對保戶承諾的基礎，同時兼顧財務彈性與策略性資本配置。我對公司的財務實力感到滿意，這也支持我們的資本部署。我們珍視連續 43 年提高股利的紀錄，並承諾在 2026 年延續此一紀錄；結合庫藏股回購與股利，我們在第二季回饋股東 13 億美元，上半年合計回饋 26 億美元。在此過程中，我們維持了在同業中資本報酬率最高、資本成本最低的公司之一的地位。

We continue to pursue more profitable growth and the tactical opportunistic deployment of capital. The Japanese and US insurance markets are two of the best insurance markets in the world, both share characteristics that make them well suited to the products we offer. Across Japan and the United States, consumers are feeling the strain of increasing out-of-pocket medical expenses. That's exactly where our products can help.

我們持續追求更具獲利性的成長，以及策略性、機會式的資本部署。日本與美國保險市場是全球最優質的兩個保險市場之一，兩者都具備使其非常適合我們所提供產品的特性。在日本與美國，消費者都感受到自付醫療費用上升所帶來的壓力。這正是我們產品能夠提供協助之處。

As you have heard me say many times before, I believe the need for our products is actually more compelling in this type of environment because the financial risk to the household becomes more pronounced and more impactful. As a pioneer in cancer insurance and leader in the industry, our employees, sales teams and sales partners show up every day to help ease that burden, providing financial protection with genuine compassion and care. The ongoing foundational strength of our business and our capacity for continued growth support our leading position and build on our momentum. I'll now turn the program over to Max to cover more details of the financial results. Max?

正如各位多次聽我說過的，我認為在這樣的環境下，對我們產品的需求其實更為迫切，因為家庭所承擔的財務風險變得更明顯、影響也更大。作為癌症保險的先驅與產業領導者，我們的員工、銷售團隊與銷售合作夥伴每天都投入其中，協助減輕這份負擔，以真誠的同理與關懷提供財務保障。我們業務持續穩固的基礎實力與持續成長的能力，支撐我們的領先地位並延續動能。接下來我把會議交給 Max，請他說明更多財務結果細節。Max？

Thank you, Dan. For the second quarter of 2026, adjusted earnings per diluted share increased 1.1% year-over-year to $1.80, excluding effect of foreign currency in the quarter. In this quarter, remeasurement gains on reserves totaled $46 million, reducing benefits with $7 million or $0.01 per diluted share below plan. Variable investment income ran $72 million or $0.11 per diluted share below our long-term return expectations. We also released a $26 million expense contingency with lowered expenses in our US

謝謝你，Dan。2026 年第二季，若排除本季外幣影響，稀釋後每股調整後盈餘較去年同期成長 1.1% 至 1.80 美元。本季，準備金重新衡量（remeasurement）收益合計 4,600 萬美元，使給付（benefits）較計畫低 700 萬美元，或稀釋後每股低 0.01 美元。變動投資收益（variable investment income）較我們長期報酬預期低 7,200 萬美元，或稀釋後每股低 0.11 美元。我們也釋放了 2,600 萬美元的費用準備金（expense contingency），並降低了我們在美國的費用

segment, benefiting results by $0.04 per share. Adjusted book value per share, excluding foreign currency remeasurement decreased 4.1%. The adjusted ROE was 12.7% and 16.6%, excluding foreign currency remeasurement, a solid spread to our cost of capital. Overall, we view these results in the quarter as solid. Starting with our Japan segment.

分部，為業績帶來每股0.04美元的助益。經調整後每股帳面價值（排除外幣重估）下降4.1%。經調整後ROE為12.7%，若排除外幣重估則為16.6%，相較於我們的資本成本呈現穩健利差。整體而言，我們認為本季的結果表現穩健。先從日本分部開始。

Net earned premiums in yen terms for the quarter declined 3.7%. Aflac Japan's underlying earned premiums, which excludes the impact of reinsurance, paid-up policies and deferred profit liability declined 1.4%. Japan's total benefit ratio came in at 64% for the quarter, down 250 basis points year-over-year. We estimate the impact from reserve reinvestment gains were under plan by approximately 60 basis points. We continue to have favorable trends in cancer and hospitalization.

以日圓計，本季淨已賺保費下降3.7%。Aflac Japan 的核心已賺保費（排除再保影響、繳清保單以及遞延利潤負債的影響）下降1.4%。日本本季總給付率為64%，較去年同期下降250個基點。我們估計，準備金再投資收益的影響較計畫低約60個基點。癌症與住院方面的趨勢仍然有利。

Recognizing that the year-to-date benefit ratio is 63.4%, we now expect to be at the high end of our guidance range of 60% to 63% for the full year of 2026, excluding the annual actuarial assumption review in Q3. Persistency remains solid and in line with our expectations at 92.7%. We have continued to experience somewhat elevated lapse and reissue activity on recently launched products as we have expanded coverage options and competitiveness on our new products. Lapses on our first sector savings block remained low and in line with previous periods despite the increase in yen interest rates. Our expense ratio in Japan was 20.2% for the quarter, down 40 basis points year over year.

鑑於年初至今給付率為63.4%，我們目前預期2026全年（不含第三季年度精算假設檢視）將落在我們60%至63%指引區間的高端。保單持續率仍然穩健，為92.7%，符合我們的預期。隨著我們擴大保障選項並提升新產品競爭力，近期推出產品的解約與再投保活動仍略為偏高。儘管日圓利率上升，我們第一部門儲蓄型保單組合的解約率仍維持偏低，且與先前期間一致。日本本季費用率為20.2%，較去年同期下降40個基點。

This is a strong result, especially on the back of the current inflationary pressures in Japan. For the quarter, adjusted net investment income in yen terms was down 2.9%, primarily driven by lower call income and lower dollar-denominated floating rate income, partially offset by higher income on US dollar assets due to the weakening of the yen and higher dollar-denominated fixed-rate income. The pretax margin for Japan in the quarter was 34.3%, up 230 basis points year-over-year, a very good result. As we previously discussed, after Japan set an internal reinsurance target of up to 10% of US GAAP assets. We have revisited this target and aligned it with an FSA perspective, of up to 30% of FSA reserves. This will allow us to continue to reduce risk, improve balance sheet efficiency and ultimately generate a higher ROE for Aflac Japan and the group.

這是一項強勁的結果，尤其是在日本目前通膨壓力之下。本季以日圓計的經調整淨投資收益下降2.9%，主要受較低的提前贖回（call）收益與較低的美元計價浮動利率收益所致，部分被因日圓走弱而使美元資產收益提高，以及美元計價固定利率收益增加所抵銷。日本本季稅前利潤率為34.3%，較去年同期上升230個基點，表現非常好。如我們先前所討論，日本在內部設定再保目標，最高可達美國GAAP資產的10%。我們已重新檢視此目標，並將其與FSA觀點對齊，最高可達FSA準備金的30%。這將使我們能持續降低風險、提升資產負債表效率，並最終為Aflac Japan及集團帶來更高的ROE。

Turning to US results, net earned premiums were up 2.3%. We expect our net earned premium growth rate for 2026 to be just below our guidance range of 3% to 6% versus previous guidance, for the low end of this range. We continue, though, to expect our 2025 to 2027 net earned premium CAGR to be within the range of 3% to 6%. Premium persistency remained solid at 79.4%, up 20 basis points year over year. Our total benefit ratio came in at 49.5%, 220 basis points higher than Q2 2025, driven by an increase in incurred group disability claims in the quarter related to favorable results in the previous quarter.

轉向美國業績，淨已賺保費成長2.3%。我們預期2026年的淨已賺保費成長率將略低於我們3%至6%的指引區間，相較於先前指引將落在該區間的低端。不過，我們仍預期2025至2027年淨已賺保費的年複合成長率（CAGR）將落在3%至6%之間。保費持續率仍然穩健，為79.4%，較去年同期上升20個基點。本季總給付率為49.5%，較2025年第二季高220個基點，主要因本季已發生的團體失能理賠增加，與前一季的有利結果相關。

We estimate that reserve remeasurement gains impacted a benefit ratio by about 30 basis points above plan. Our expense ratio in the US was 36.1%, down 20 basis points year-over-year. Adjusted net investment income in the US was essentially flat, up 0.5% for the quarter as higher call and fixed rate income were offset by lower floating rate and short-term income.

我們估計，準備金重估收益使給付率較計畫高出約30個基點。美國本季費用率為36.1%，較去年同期下降20個基點。美國本季經調整淨投資收益基本持平，季增0.5%，因較高的提前贖回（call）與固定利率收益被較低的浮動利率與短期收益所抵銷。

Profitability in the US segment was solid with a pretax margin of 20.9%, a 160 basis point decrease compared with a strong quarter a year ago. Corporate and other reported a pretax adjusted loss of $10 million, down from a $20 million gain last year. The main drivers were lower adjusted net investment income from lower short-term income and reduced hedge benefits that were partially offset by higher fixed rate income. Although our tax credit investments impacted the adjusted net investment income line for US GAAP purposes negatively by $6 million in the quarter with an associated credit to the tax line, the overall tax credit investment program benefited net earnings by $8 million.

美國分部獲利能力穩健，稅前利潤率為20.9%，較去年同期強勁的一季下降160個基點。公司本部及其他項目稅前經調整虧損為1,000萬美元，較去年2,000萬美元的獲利下滑。主要驅動因素為短期收益下降導致經調整淨投資收益降低，以及避險效益減少，部分被固定利率收益增加所抵銷。雖然就美國GAAP而言，我們的稅額抵免投資在本季使經調整淨投資收益項目負向影響600萬美元，並在稅項列示相對應的抵免，但整體稅額抵免投資計畫使淨利增加800萬美元。

Higher interest expense and runoff impact from our closed blocks of business also contributed to the net loss for the quarter. We're pleased with our overall performance of our investment portfolio. Our private credit portfolio, most notably our middle market loan portfolio continues to deliver strong risk-adjusted net yields. During the quarter, our Global Investments team were quite active repositioning $4.8 billion of the portfolio through switch trades to capture the benefit of higher yields and further strengthening the overall quality of our consolidated portfolio.

較高的利息費用以及已停止承作（closed blocks）業務的自然流失影響，也對本季淨損有所貢獻。我們對投資組合的整體表現感到滿意。我們的私募信貸投資組合，尤其是中型市場貸款投資組合，持續提供強勁的風險調整後淨收益率。本季，我們的全球投資團隊相當積極，透過換券交易（switch trades）重新配置48億美元的投資組合，以掌握較高殖利率的效益，並進一步強化合併投資組合的整體品質。

These traits capture foreign currency gains to minimize market losses on lower-yielding assets, reduce the risk of future FSA impairments, improve our ALM and boost net investment income. On an annualized basis, we expect this program to increase net investment income by over $50 million on a run rate basis with a very limited impact on capital levels. We will continue pursuing opportunities that improve the overall health and performance of the portfolio. For US statutory, we recorded $11 million of impairments on invested assets and $1 million valuation allowance on our mortgage loans as an unrealized loss during the quarter.

這些交易可實現外幣收益，以降低低殖利率資產的市場損失，降低未來FSA減損風險，改善我們的資產負債管理（ALM），並提升淨投資收益。以年化基礎計，我們預期此計畫在穩態（run rate）下可使淨投資收益增加超過5,000萬美元，且對資本水準的影響非常有限。我們將持續尋求可改善投資組合整體健康度與表現的機會。就美國法定會計（US statutory）而言，本季我們對投資資產認列1,100萬美元減損，並就房貸貸款認列100萬美元估值備抵，作為未實現損失。

On a Japan FSA basis, we booked securities impairment of JPY15.8 billion and an additional valuation allowance of JPY33 million related to transitional real estate loans in Q2. This is well within our expectations and has a limited impact on regulatory earnings and capital. Aflac Inc. unencumbered liquidity stood at $3.3 billion, which was $2.3 billion above our minimum balance of $1 billion at the end of the quarter. Our adjusted leverage was 21.8% for the quarter, which is within our target range of 20% to 25%.

以日本FSA基礎計，我們在第二季認列證券減損158億日圓，並就過渡性不動產貸款另提列3,300萬日圓的估值備抵。這完全在我們預期之內，且對監理盈餘與資本的影響有限。Aflac Inc. 的無擔保流動性為33億美元，於季末較我們10億美元的最低餘額高出23億美元。本季經調整槓桿比率為21.8%，落在我們20%至25%的目標區間內。

As we hold approximately 63% of our debt in yen, this leverage ratio is impacted by moves in the yen-dollar exchange rate. This is intentional and part of our enterprise hedging program connecting the economic value of Aflac Japan in US dollar terms. Our capital position remains strong. We ended the quarter with an estimated regulatory ESR of 226%.

由於我們約63%的債務以日圓計價，該槓桿比率會受到日圓兌美元匯率變動的影響。這是刻意為之，亦是我們企業避險計畫的一部分，用以連結Aflac Japan以美元衡量的經濟價值。我們的資本部位仍然強勁。本季末，我們估計監理ESR為226%。

If including the undertaking specific parameter or USP, this would add 14 points to the regulatory ratio and result in an ESR with USP of 240%. The decline quarter over quarter was primarily driven by significant subsidiary dividends. We estimate our combined RBC to be slightly above 600%. These are strong capital ratios which we actively monitor, stress and manage to withstand both market volatility and credit cycles as well as external shocks.

若納入特定承作參數（undertaking specific parameter，USP），監理比率將增加14點，使含USP的ESR達240%。季對季下降主要由於子公司股利大幅發放所致。我們估計合併RBC略高於600%。這些都是強勁的資本比率；我們會主動監控、進行壓力測試並加以管理，以承受市場波動與信用循環，以及外部衝擊。

Given the strength of our capital and liquidity, we repurchased $983 million of our own stock and paid dividends of $309 million in Q2, offering good relative IRR on these capital deployments. We will continue to be flexible and tactical in the way we manage the balance sheet and deploy capital in order to drive strong risk-adjusted ROE with a meaningful spread to our cost of capital.

鑑於我們資本與流動性的強勁，我們在第二季回購了9.83億美元自家股票，並支付了3.09億美元股利，這些資本運用帶來了相對不錯的IRR。我們將持續以彈性且策略性的方式管理資產負債表並配置資本，以推動強勁的風險調整後ROE，並與我們的資本成本維持具意義的利差。

Thank you and I will now turn the call back over to David.

謝謝，接下來我把電話交回給David。

Thank you, Max. (Event Instructions)

謝謝你，Max。(活動說明)

(Operator Instructions) Ryan Krueger, KBW.

(接線員指示) Ryan Krueger，KBW。

My first question was on the asset repositioning that you did during the quarter. maybe, I guess, first, maybe a little bit more detail on what you did, but then probably more importantly, to what extent do you see additional opportunities to do more of this going forward?

我第一個問題是關於你們本季進行的資產重新配置。也許，先請你們更詳細說明做了哪些動作；但更重要的是，往後你們認為還有多大程度的額外機會可以繼續做更多這類操作？

Yes. Thank you, Ryan. This is Brad. Yes, we were -- I'm very pleased that we were able to reposition about 5% of our portfolio in a single quarter. Obviously, we're solving for multiple objectives here.

是的。謝謝你，Ryan。我是Brad。是的，我非常高興我們能在單一季度內重新配置約5%的投資組合。顯然，我們在這裡要同時達成多重目標。

Income is an important driver as our losses as you sell the lower-yielding assets from prior periods, but we also have to manage taxes, liquidity, ALM, et cetera. So it's a pretty complex puzzle that we have to solve. What we were able to do this quarter was harvest gains from foreign currency on our dollar portfolio in Aflac Japan and use that to offset losses on some of those older bonds, both in our US dollar portfolio, but also our JGB portfolio. We repositioned in both of those sectors.

當你出售前期較低殖利率的資產時，損失會影響收益，因此收益是重要的驅動因素；但我們也必須管理稅負、流動性、ALM（資產負債管理）等等。所以這是一個相當複雜、需要解的拼圖。本季我們能做到的是：在Aflac Japan的美元投資組合中，收割外匯帶來的收益，用以抵銷部分舊債券的損失，這些舊債券同時存在於我們的美元投資組合以及JGB（日本公債）投資組合中。我們在這兩個領域都進行了重新配置。

Most of the activity was in Aflac Japan, but we also touched Aflac US and Aflac Bermuda with some adjustments to the portfolio there as well. In terms of the forward look, there's a reason insurance companies are often referred to as buy and hold, not my favorite term, by the way. But it is a complex puzzle to solve. But when you can crack the code, you can have a pretty significant impact as we saw this quarter, and we see a very big opportunity in front of us from the higher rate environment, and we didn't stop working on June 30. So we're not going to -- we're going to do our best not to waste this opportunity, and I look forward to talking more about it in the third quarter.

大部分的操作發生在Aflac Japan，但我們也對Aflac US與Aflac Bermuda的投資組合做了一些調整。就前瞻來看，保險公司常被稱為「買入並持有」（順帶一提，這不是我最喜歡的說法）。但這確實是一個複雜的拼圖。不過，一旦能破解其中的關鍵，就能產生相當顯著的影響，正如我們本季所見；而在較高利率環境下，我們看到非常大的機會，而且我們在6月30日之後也沒有停止努力。所以我們不會——我們會盡最大努力不浪費這個機會，也期待在第三季再多談一些。

Okay. And on first sector sales in Japan, you had strong sales there. I think demand is generally increasing for first sector type products given the higher rate environment there, but you've always been a third sector company. Curious, is there any practical limit in your view of what percentage or amount of your Japan sales you'd be willing to have come from the first sector given kind of there's probably a bigger growth opportunity there if you wanted it?

好的。另外關於日本第一領域（first sector）銷售，你們的銷售表現很強。我認為在較高利率環境下，市場對第一領域類型產品的需求普遍在增加，但你們一直是第三領域公司。我好奇的是，從實務角度來看，你們是否認為日本銷售中第一領域占比或金額有任何上限？畢竟如果你們願意，第一領域可能有更大的成長機會。

Let me -- this is Max. Let me start, and then I'll ask Japan to add some commentary to this. From a group standpoint, we don't have a certain or specific set limit of our mix between third sector and first sector business. The primary driver for us is the return that we can get on certain products and the risk that comes with those products. Right now, we are getting very good risk-adjusted return on the first sector business that we are writing today.

我先——我是Max。我先回答，然後請日本團隊再補充一些看法。從集團角度，我們並沒有對第三領域與第一領域業務的組合設定某個固定或明確的上限。對我們而言，主要驅動因素是特定產品可取得的報酬，以及該產品所伴隨的風險。目前，我們在今天承作的第一領域業務上，取得了非常好的風險調整後報酬。

So we're very, very pleased with adding that to our portfolio. Overall, though, we do acknowledge that our in-force is predominantly driven by third sector business. And that's a business that is very stable, predictable, and it has risks that we are very comfortable with. And the first sector business adds a different type of risk profile to our business, i.e., mortality, spread and to some extent, longevity risk. So when we add that to our existing balance sheet, that is in relatively small portions, it's actually quite good for us from a diversification benefit standpoint.

因此，我們非常、非常樂見把它納入我們的投資組合。不過整體而言，我們也承認，我們的有效保單（in-force）主要仍由第三領域業務所驅動。而那是一個非常穩定、可預測的業務，其風險也在我們非常能接受的範圍內。第一領域業務則為我們帶來不同型態的風險輪廓，例如死亡率、利差，以及在某種程度上的長壽風險。因此，當我們把它以相對小的比例加入既有資產負債表時，從分散化效益的角度來看，對我們其實相當有利。

But if it gets too high, those risks can actually be risk increases overall for us. At this point, the first sector in-force is less than 20% of our total in-force and it has been climbing for quite a period of time, essentially since 2016 when we exited the WAYS business when JGB yields went negative. But as of right now, we are starting to see very good returns on the first sector business, and we're very happy with the business we're selling.

但如果占比過高，這些風險反而可能使我們整體風險上升。目前，第一領域的有效保單占我們總有效保單不到20%，而且在相當長一段時間內持續上升，基本上自2016年我們在JGB殖利率轉為負值時退出WAYS業務以來就是如此。但就目前而言，我們開始在第一領域業務上看到非常好的報酬，我們也對正在銷售的業務感到非常滿意。

(spoken in Japanese)

(以日語發言)

(interpreted) This is Koide speaking from Aflac Japan.

(口譯) 我是Aflac Japan的Koide。

(spoken in Japanese)

(以日語發言)

(interpreted) As Max has described, Tsumitas, our first sector products account for 20% of the total sales.

(口譯) 如Max所述，Tsumitas（我們的第一領域產品）約占總銷售的20%。

(spoken in Japanese)

(以日語發言)

(interpreted) But it's not that we set a specific target or upper limit in terms of the first sector product sales.

(口譯) 但我們並沒有就第一領域產品銷售設定特定目標或上限。

(spoken in Japanese)

(以日語發言)

(interpreted) Tsumitas is contributing in expanding our platform, our customer base through a younger generation, and it's been well received by those younger customers today.

(口譯) Tsumitas透過較年輕世代，協助我們擴大平台與客戶基礎，而且目前在這些年輕客群中反應良好。

(spoken in Japanese)

(以日語發言)

(interpreted) And Tsumitas is also making a great contribution in expanding our sales in cancer and medical insurance through concurrent sales.

(口譯) 同時，Tsumitas也透過搭售（concurrent sales），對我們擴大癌症與醫療保險的銷售做出很大貢獻。

(spoken in Japanese)

(以日語發言)

(interpreted) So we remain to be the third sector-oriented company, but Tsumitas is definitely playing an important role from a strategic perspective.

(口譯) 因此，我們仍然是一家以第三領域為導向的公司，但從策略角度來看，Tsumitas確實扮演著重要角色。

Tom Gallagher, Evercore ISI.

Tom Gallagher，Evercore ISI。

I just want to start with a higher-level M&A question for you. So historically, Aflac has done small deals. Should we expect that to be the case going forward? Or would you consider going bigger and more strategic if opportunities arise?

我想先從較高層次的併購（M&A）問題開始。歷史上，Aflac做的多是小型交易。未來我們是否也應預期會是如此？或者若有機會出現，你們會考慮做更大、更具策略性的交易嗎？

I think the answer is we continue to look at opportunities. Generally, if something is for sale, it's for sale for a reason. And so we want to be careful in how we spend the money. It took us a long time to make it, and we want to be careful with that. But at the same time, if there's opportunities, we certainly want to look into it.

我想答案是：我們會持續尋找機會。一般來說，如果某個標的在出售，通常是有原因的。因此，我們在花錢的方式上必須謹慎。我們花了很長時間才累積到這些資金，所以我們希望謹慎使用。但同時，如果有機會，我們當然也會去研究。

I am pleased with the development of the small companies that we bought and what's taking place. They've turned around and done much better in the last year or so, and I'm encouraged by that. So the answer is yes, we would look elsewhere but it would have to pass a strenuous test for us to be excited and really interested in something.

我對我們所收購的小型公司的發展感到滿意，以及目前正在發生的改變。它們在過去一年左右扭轉局面、表現好很多，這讓我受到鼓舞。所以答案是：是的，我們會看其他機會，但必須通過非常嚴格的測試，才會讓我們感到興奮並真正有興趣。

Okay. And then my follow-up is, Max, on the expansion of the limit in terms of reinsuring Japanese business to Bermuda, can you just give a little bit of color what the 30% of FSA reserves now. Was that just -- is that still just the company imposed limit? Or was that in consultation with the FSA? And will this signal an ability to actually do more each time you do them? Like, can we expect the cadence of reinsurance to be going up annually? Or would you still expect it to be similar to what you've done in the past?

好的。接著我想追問一下，Max，關於把日本業務再保到百慕達時，將上限擴大這件事，你能否稍微補充一些背景，說明現在以FSA準備金計算的30%是怎麼來的？那只是——仍然只是公司自行設定的上限嗎？還是有與FSA協商？這是否意味著每次做交易時，實際上能做得更多？例如，我們是否可以預期再保的節奏會逐年提高？還是你們仍預期會與過去做法相近？

Yes. So this move from having a ceding limit from 10% of US GAAP assets to 30% of FSA reserves, this is an internally imposed limit that we have developed ourselves. But you should assume that we have shared this with external constituents as well and receive feedback on it. So we -- this is something that makes sense for us.

是的。因此，這次從以美國GAAP資產的10%作為分出上限，改為以FSA準備金的30%作為上限，這是我們自行制定的內部上限。但你可以假設，我們也已與外部利害關係人分享並就此取得回饋。所以我們——這是對我們而言合理的作法。

We feel it fits us well when we balance the overall risks and opportunities available to us. As it relates to the size of future transactions, there is obviously a cost with every transaction that you do. So if you do any bigger transactions, that means that the cost per transaction now is somewhat lower. And we obviously now feel that we have developed a strong track record both internally and now also externally to execute these transactions. So we feel very good about both significant opportunities that we have in front of us to improve the risk profile of the company and also the return profile of the company utilizing reinsurance.

我們認為，當我們在整體可承擔的風險與可把握的機會之間做平衡時，這個上限很適合我們。至於未來交易規模，顯然每做一筆交易都會有成本。因此若做更大規模的交易，單筆交易的成本相對就會更低一些。而且我們現在顯然也認為，無論在內部或外部，我們都已建立起執行這些交易的良好實績。因此，對於透過再保來改善公司風險結構，以及提升公司報酬結構，我們面前都有相當重大的機會，我們對此非常有信心。

Suneet Kamath, Jefferies.

Suneet Kamath，Jefferies。

I wanted to start with the medical sales in Japan. I know they were up year over year, but they were down sequentially. Despite the product launch in December, I would have thought that you had a little bit more runway given the product launch. So can you just talk about what you're seeing in that product line and your expectations for the balance of the year?

我想先從日本的醫療險銷售談起。我知道年增是上升的，但季比是下降的。儘管12月有產品上市，我原本以為在產品上市後應該還有更長的成長跑道。所以你能否談談你們在這條產品線看到的情況，以及對今年剩餘期間的預期？

(spoken in Japanese)

(日語發言)

(interpreted) Thank you for your question. This is Yoshizumi in charge of Marketing Sales in Aflac Japan.

(口譯) 感謝您的提問。我是負責日本Aflac行銷銷售的Yoshizumi。

(spoken in Japanese)

(日語發言)

(interpreted) As you just described, Anshin Palette or medical insurance products is its momentum is sustaining from the first quarter to second quarter.

(口譯) 如您所述，安心Palette（Anshin Palette）或醫療保險產品的動能，從第一季延續到第二季，仍在維持。

(spoken in Japanese)

(日語發言)

(interpreted) And as a result, the first half of 2026 sales exceeded the prior year.

(口譯) 因此，2026年上半年銷售超過去年同期。

(spoken in Japanese)

(日語發言)

(interpreted) But it's also true that there was a decline from the first quarter to second quarter.

(口譯) 但從第一季到第二季確實也出現下滑。

(spoken in Japanese)

(日語發言)

(interpreted) And this is because about the timing. This product was actually launched towards the end of December last year.

(口譯) 這主要是因為時點因素。這項產品其實是在去年12月底左右推出。

(spoken in Japanese)

(日語發言)

(interpreted) And we were making a thorough preparation towards that day during December.

(口譯) 而我們在12月期間為那一天做了非常充分的準備。

(spoken in Japanese)

(日語發言)

(interpreted) And that is why we managed to get a great sales or solid results in the first quarter.

(口譯) 這也是為什麼我們在第一季能取得很好的銷售、或說穩健的成果。

(spoken in Japanese)

(日語發言)

(interpreted) And we enjoyed the more-than-expected momentum even in the second quarter.

(口譯) 而且在第二季，我們也享受到超出預期的動能。

(spoken in Japanese)

(日語發言)

(interpreted) And we expect this momentum to continue through third quarter and fourth quarter.

(口譯) 我們預期這股動能將延續到第三季與第四季。

Okay. And then maybe shifting to the US, Virgil, can you just give us some thoughts on how you're feeling about sales so far this year? And I think in the past, you've given us some good color on how the traditional channel has performed relative to the brokerage channel. I was wondering if you could give us an update there as well.

好的。接著把焦點轉到美國，Virgil，你能否分享一下你對今年迄今銷售表現的感受？我記得過去你曾提供一些很好的說明，談到傳統通路相對於經紀通路的表現。也想請你更新一下這部分。

Yes, certainly. Let me first start by saying that pretty much for the year, we're in line with expectations, slightly the lower in my expectations. But as you indicated, I'm expecting a stronger second half of the year heavily weighted in the fourth quarter due to the seasonality of our business and the strength we continue to see though, in our plants or our Group Life Absence Disability business. Let me give you just a little bit more color on the performance of how the portfolio balances out. First, if you add just our Group Life Absence Disability to our Dental and Vision, just looking at those two products and then with all group voluntary benefits, we were up 7.1% for second quarter.

好的，當然可以。我先說整體而言，今年目前大致符合預期，略低於我原先的預期。但如你所提，我預期下半年會更強，且因我們業務的季節性，以及我們在「plants」或團體壽險／缺勤與失能（Group Life Absence Disability）業務持續看到的強勁表現，成長將明顯集中在第四季。我再補充一些細節，說明投組表現如何平衡。首先，如果把團體壽險／缺勤與失能加上牙科與視力（Dental and Vision），只看這兩塊，再加上所有團體自願性福利（group voluntary benefits），第二季我們成長了7.1%。

Again, seeing good performance there. When you look at the overall earned premium results, for those group products, we were up [13%] for the earned premium. That gives you kind of a little bit of color that we're seeing continued steady growth in our group business. It's in line with the market though. And you can see the market now as brokers have gone more heavily into voluntary benefits.

同樣地，這部分表現不錯。若看整體已賺保費（earned premium）的結果，這些團體產品的已賺保費成長了[13%]。這讓你大致了解，我們在團體業務上仍看到持續且穩健的成長。不過這也與市場一致。你也可以看到，隨著經紀人更大幅度地投入自願性福利，市場正在發生變化。

They are selling more of the group product. We're seeing that. We are still dedicated though, to our agency force. We continue to roll out strong individual traditional products for them. And I do expect, though, to have a stronger year of traditional overall this year again, with a stronger second half heavily weighted in the fourth quarter.

他們正在銷售更多團體產品。我們也看到了這點。不過我們仍然致力於我們的代理人隊伍。我們持續為他們推出強而有力的個人傳統型產品。而且我確實預期，今年傳統型產品整體會是更強的一年，同樣是下半年更強、且成長高度集中在第四季。

Just a couple more things. Dan mentioned earlier about the investments we made, though, with the properties. When you look at the Dental and Vision property, we were up 47% in the second quarter. Very strong performance, heavily driven by our agency force. We're going to push stronger in the second half of the year and really get brokers to adopt the network dental products, that's going to be our focus going into the second half of the year.

再補充幾點。Dan先前提到我們在「properties」方面所做的投資。當你看牙科與視力的「property」，第二季我們成長了47%。表現非常強勁，主要由我們的代理人隊伍所帶動。我們會在下半年更積極推進，並真正讓經紀人採用網絡型牙科產品（network dental products），這將是我們下半年的重點。

I think also when you look at the Dental and Vision property, we continue though to be focused on ensuring that we're selling our voluntary benefits product alongside of that. So for every dollar that we sold in the second quarter, next to the voluntary benefits, you will see that we sold $1.07 of voluntary benefits. That's better than we ever expected. And that's the trend I want to see continue. We're not just selling it standalone.

另外，當你看牙科與視力的「property」，我們也持續聚焦於確保在銷售這些產品的同時，也一併銷售我們的自願性福利產品。因此，第二季我們每賣出1美元（牙科與視力）時，搭配自願性福利我們賣出了1.07美元。這比我們原先預期的還要好。而這就是我希望能延續的趨勢。我們不是只單獨銷售它。

It drives VB alongside of it. Just again, overall, we've got some strong comparisons in the second half of the year, but I'm expecting growth to be higher than last year and I'm expecting a big strong fourth quarter though.

它會帶動自願性福利（VB）一起成長。再重申一次，整體而言，下半年我們面臨一些較強的比較基期，但我預期成長會高於去年，而且我也預期第四季會非常強勁。

Mike Ward, UBS.

Mike Ward，UBS。

I was wondering in Japan, if you guys have seen any change in the lapse paid up or surrender behavior given the inflationary kind of pressure and higher rates in Japan.

我想請教一下在日本，鑑於通膨壓力以及日本利率走高，你們是否觀察到保單失效率、繳清（paid-up）或解約行為有任何變化？

Yes. Thank you for the question. So far, we haven't really seen any sort of significant lapse uptick related to either inflation or to interest rates. If you look at our first sector block, which would be the block of business that should be the most sensitive to interest rates, we've seen a minor uptick, but that's from very, very low levels. And we certainly have not seen any spikes or significant correlation with the increase in rates there.

是的。謝謝你的提問。到目前為止，我們其實沒有看到任何與通膨或利率相關的顯著失效率上升。如果你看我們第一個區塊（sector block），也就是理應對利率最敏感的那一塊業務，我們確實看到些微上升，但那是從非常、非常低的水準起來的。而且我們當然沒有看到任何尖峰，或與利率上升之間有顯著的相關性。

So even when we -- if you don't think about inflation pressures as well, that hasn't necessarily had any significant impact on our lapse rates. The decline in persistency that you have seen year-over-year has more been driven by the product launches that we have experienced both on cancer and medical much more so on the cancer side than the medical side. But when we do refresh our product portfolio and we come up with more attractive new products, we always see an element of increased levels of lapse and reissue obviously impacting our persistency rate, and we certainly experienced that with our Miraito launch. As we look forward, we do believe that Miraito is now through the full first year of being out there. So with that, we would expect some decline in lapse and reissue going forward.

所以即便我們——如果你也把通膨壓力先放一邊不談——通膨本身也未必對我們的失效率造成任何顯著影響。你看到的年度間持續率下滑，更多是由我們在癌症險與醫療險的產品上市所驅動，而且在癌症險端的影響遠大於醫療險端。但當我們更新產品組合、推出更具吸引力的新產品時，我們總會看到一定程度的失效率上升與重新投保（reissue），這些都會明顯影響持續率，而我們在 Miraito 上市時也確實經歷了這種情況。展望未來，我們認為 Miraito 現在已經完整走過上市後的第一年。因此，我們預期接下來失效率與重新投保會有所下降。

And therefore, we should expect our persistency rate as reported to stabilize going forward.

因此，我們預期未來所揭露的持續率將會趨於穩定。

And then Dan, I just wanted to ask again about the M&A question. I totally get that properties that are for sale, are for sale for a reason sometimes. Just curious like how interested you guys might be in something that could really help you leapfrog in the US specifically in a diversified way.

另外 Dan，我想再問一次關於併購（M&A）那個問題。我完全理解，有些待售資產之所以出售，有時候是有原因的。我只是好奇，你們對於那種能在美國市場、以更分散多元的方式，真正幫助你們「跳躍式」成長的標的，興趣有多大？

We certainly are looking all the time. And if you have any suggestions, we're willing to listen. But our focus has been on turning these other programs around, which I'm very pleased with what's been going on there. And now that I'm at that point, our financial team brings us what they think makes financial sense and then we see how it would coordinate and work well with our existing distribution or do we look at it totally separate. And we look at both ways.

我們當然一直都在看。如果你有任何建議，我們也願意聽。不過我們的重點一直放在把其他計畫扭轉過來，而我對那邊目前的進展非常滿意。現在到了這個階段，我們的財務團隊會帶來他們認為在財務上合理的案子，然後我們會評估它是否能與我們既有的通路協同、運作良好，或是我們要把它當作完全獨立的業務來看。而這兩種方式我們都會評估。

We look at it that if it's products we don't sell, how we might mix it together. And then if you talk about merging where we sell products that we already sell, that would be how we had to look at it from a disciplined perspective and make sure that we are following guidelines, and we realize that can create disruption, but we're willing to do it if it makes sense. So we'll continue to watch those.

我們會從這樣的角度看：如果是我們目前沒有賣的產品，我們要如何把它們整合搭配。而如果談的是合併、且對方賣的是我們已經在賣的產品，那我們就必須以紀律性的角度來檢視，確保遵循各項準則；我們也知道那可能造成擾動，但只要合理，我們願意做。所以我們會持續關注這些機會。

Wes Carmichael, Wells Fargo.

Wes Carmichael，富國銀行（Wells Fargo）。

First question was just on Japan sales. I think, Dan, last quarter, you mentioned that you'd be happy this year if we got to JPY80 billion unit sales, maybe the company would be satisfied with a little less. But just curious, we're halfway through the year, I think we're at JPY37 billion in change of yen sales. So just curious what you're thinking for the rest of the year?

第一個問題是關於日本的銷售。Dan，我記得上季你提到，如果今年單位銷售能到 800 億日圓你會很高興，或許公司也會接受稍微低一點。但我想問的是，我們現在已經過了一半，我想目前以日圓計的銷售變動大概是 370 億日圓。所以想請教你對下半年有什麼看法？

Well, I'd still be happy with sales at $80 billion. But as I stated today, we expect the 2026 numbers to exceed last year's numbers, and that I also said in the first -- the end of the first quarter. We delayed some of our direct major campaigns in Japan but are now back on track. And the JPY80 billion was a challenge to begin with and remains in the realm of possibilities for us to achieve. So I won't rule it out, but I'm confident and can say that in terms of 2026 sales will exceed 2025.

嗯，我仍然會很高興看到銷售達到 800 億。但如我今天所說，我們預期 2026 年的數字會超過去年的數字，而我在第一——第一季末也有提到。我們在日本延後了一些直效（direct）的主要行銷活動，但現在已經回到正軌。而 800 億日圓本來就是一個挑戰，現在仍然在我們有可能達成的範圍內。所以我不會排除它，但我有信心並且可以說，2026 年的銷售將會超過 2025 年。

Got it. And Max, maybe just on ESR. I think as a rule of thumb in the past, you gave every 10 points was approximately $750 million to $1 billion of excess capital. Just curious if that's still -- is a good rule of thumb to use? And should we be thinking about including the USP when we think about your excess capital in Japan?

了解。另外 Max，想再問一下 ESR。我記得過去你們有個經驗法則：每 10 個點大約相當於 7.5 億到 10 億美元的超額資本。想確認這個——是否仍然是個好用的經驗法則？以及在思考你們日本的超額資本時，我們是否應該把 USP 也納入？

Thank you, Wes. That is -- it continues to be a good rule of thumb for our ESR capital base. As it relates to USP, we manage our business including USP, we manage our risk profile, including USP. So I would certainly include that. We think that, that gives a better view and better reflects the risks of our business when including USP in the ESR, so that is why we're using it.

謝謝你，Wes。就我們的 ESR 資本基礎而言，這——仍然是一個不錯的經驗法則。至於 USP，我們在管理業務時會把 USP 納入，我們在管理風險輪廓時也會把 USP 納入。所以我當然會把它納入考量。我們認為，在 ESR 中納入 USP 能提供更好的視角，也更能反映我們業務的風險，因此我們才會採用這種方式。

Joel Hurwitz, Dowling & Partners.

Joel Hurwitz，Dowling & Partners。

Max, one more on inflation. In your prepared remarks on Japan, you highlighted good expense results despite the inflationary pressures. Can you just elaborate on how significant those inflation pressures are on your expense base? And I guess, any other headwinds from inflation in Japan?

Max，再問一個關於通膨的問題。在你針對日本的事先準備講稿中，你提到儘管有通膨壓力，費用表現仍然不錯。你能否再多說明一下，這些通膨壓力對你們費用基礎的影響有多大？以及我想問，通膨在日本是否還帶來其他逆風？

Yes. So let me kick it off. And I like Morimoto-san to give some commentary on this as well. Japan inflation is running close to 3% at the moment. And obviously, that is a function of domestic inflationary pressures but also weakening yen leads to imported inflation as well into the Japanese economy.

好的。那我先開頭說明。我也想請 Morimoto 先生一併補充一些看法。目前日本通膨大約接近 3%。而這顯然一方面來自國內通膨壓力，另一方面日圓走弱也會透過進口通膨傳導到日本經濟。

And when you run those kind of inflationary pressures and you know that our revenue base is slightly shrinking. That means that managing your expense becomes quite difficult. And I think the team has done a great job managing expenses and even getting the expense ratio lower than last year. So it is in that context that I think that we've done a very good job managing that expense ratio overall. Going forward, we still expect that the 20% to 23% is a good expense ratio range for the company to operate long term. And obviously, in the very near term, we have been towards that sort of low end of that range.

在這種通膨壓力下，再加上你知道我們的收入基礎略有縮小，這代表費用管理會變得相當困難。我認為團隊在費用管理上做得非常好，甚至把費用率降到低於去年。所以也正是在這樣的背景下，我才認為我們在整體費用率管理上做得非常出色。展望未來，我們仍然預期 20% 到 23% 是公司長期營運的合理費用率區間。而且很明顯地，在非常短期內，我們一直處於該區間較低端的水準。

So please, Morimoto-san.

那麼，請 Morimoto 先生。

(spoken in Japanese)

（日語發言）

(interpreted) This is Morimoto, I would like to comment as well.

（口譯）我是 Morimoto，我也想補充說明。

(spoken in Japanese)

（日語發言）

(interpreted) And one of the important factor in relation to inflation is the Middle East situation.

（口譯）而與通膨相關的一個重要因素是中東局勢。

(spoken in Japanese)

（日語發言）

(interpreted) The Middle East situation is at this point are not giving any significant impact on the interest business in Japan.

（口譯）就目前而言，中東局勢並未對日本的利息業務造成任何顯著影響。

(spoken in Japanese)

（以日語發言）

(interpreted) That said, we will continue to monitor risks, including financial market volatility and potential upward pressure on operating expenses.

（口譯）儘管如此，我們將持續監控各項風險，包括金融市場波動，以及營運費用可能面臨的上行壓力。

(spoken in Japanese)

（以日語發言）

(interpreted) The Middle East situation remains highly uncertain and any deterioration could raise both downside risk to Japan's economy and upside risk to inflation, notably through higher crude oil prices.

（口譯）中東局勢仍高度不確定，任何惡化都可能同時提高日本經濟的下行風險與通膨的上行風險，尤其是透過原油價格上漲。

(spoken in Japanese)

（以日語發言）

(interpreted) The government is implementing supplementary budget to address Middle East driven energy price surges and has a vast alternative procurement of critical minerals with high Middle East exposure.

（口譯）政府正推動補充預算，以因應中東因素帶動的能源價格飆升，並且已建立對中東曝險較高之關鍵礦物的廣泛替代採購來源。

(spoken in Japanese)

（以日語發言）

(interpreted) We expect continued comprehensive measures in line with energy price development and domestic economic and inflation trends. That's all from me.

（口譯）我們預期將依能源價格走勢以及國內經濟與通膨趨勢，持續採取全面性措施。我這邊就到此為止。

This is Dan. One thing we try to do in these meetings is introduce new people in terms of -- in their position. And Morimoto is now our Deputy President and certainly is in line to continue to do well with us. He's in his over 25 years with the company. And Morimoto, we're glad to have you join us, and we're counting on you to help grow our business going forward as you work closely with Koide this year.

我是 Dan。我們在這些會議中會嘗試做的一件事，是介紹新加入的同仁及其職務。Morimoto 現在是我們的副總裁，當然也會持續與我們一起有很好的表現。他在公司已超過 25 年。Morimoto，很高興你加入我們；我們也期待你在今年與 Koide 密切合作的同時，協助推動未來業務成長。

All right. Very helpful response. And then just maybe a follow-up on sales, and in response to an earlier question on Tsumitas sales. You mentioned it's making I think, a great contribution expanding third sector sales. Can you just provide some more color on the cross-sell there at this time?

好的。回覆非常有幫助。接著想就銷售再追問一下，也呼應先前關於 Tsumitas 銷售的問題。你提到它對擴大第三部門銷售做出了很大的貢獻。你能否就目前的交叉銷售情況再補充一些說明？

(spoken in Japanese)

（以日語發言）

(interpreted) Thank you for your question. This is Yoshizumi once again.

（口譯）謝謝你的提問。我是 Yoshizumi，再次回答。

(spoken in Japanese)

（以日語發言）

(interpreted) And Tsumitas is a product attracting younger and middle-aged customers for seeking to accumulate their assets in yen.

（口譯）Tsumitas 是一項吸引年輕與中壯年客群、以日圓進行資產累積需求的產品。

(spoken in Japanese)

（以日語發言）

(interpreted) The results that we need from this target audience wanting to be prepared for cancer and medical, just in these products.

（口譯）而我們希望從這些目標客群取得的成果，是讓他們在癌症與醫療保障方面也能做好準備，並透過這些產品來滿足。

(spoken in Japanese)

（以日語發言）

(interpreted) However, if these needs have yet to be realized or if this means are still potential, then the job of the associates is to drive their needs in order to realize them.

（口譯）然而，若這些需求尚未被顯性化，或仍屬潛在需求，那麼業務同仁的工作就是引導並激發客戶需求，使其得以實現。

(spoken in Japanese)

（以日語發言）

(interpreted) So therefore, whenever they conduct pitches to the customers, the associates are always promoting the concurrent sales to customers.

（口譯）因此，每當他們向客戶進行提案時，業務同仁都會持續推動對客戶的同步（搭配）銷售。

(spoken in Japanese)

（以日語發言）

(interpreted) And through this effort, we have succeeded in selling cancer and medical insurance together with Tsumitas.

（口譯）透過這些努力，我們已成功在銷售 Tsumitas 的同時，搭配銷售癌症與醫療保險。

(spoken in Japanese)

（以日語發言）

(interpreted) Initially, we were planning the concurrent sales to be 25%. However, presently, we are largely exceeding this percentage.

（口譯）起初，我們規劃同步（搭配）銷售比率為 25%。但目前我們已大幅超過這個比例。

(spoken in Japanese)

（以日語發言）

(interpreted) That's all for me.

（口譯）我這邊就到此為止。

Wilma Burdis, Raymond James.

Wilma Burdis，Raymond James。

We estimate that taking Japan reinsurance from 10% to 30% would free up $5 billion to $7 billion of capital or more. Is that a reasonable estimate? And perhaps you could walk us through the pieces there?

我們估計，若將日本再保比例從 10% 提高到 30%，可釋放 50 億至 70 億美元或更多的資本。這樣的估計合理嗎？也許你可以帶我們拆解一下其中的構成？

So, Wilma, the way to think about it is if you cite the total opportunity, at the end of the fiscal year, Aflac Japan had policy reserves on an FSA basis of JPY10.8 trillion. So if you take that as a starting point, that gives you sort of the current limit of our reinsurance capacity from a ceding standpoint out of Aflac Japan. If you then think about what would that do from a capital free-up standpoint, the capital being freed up is very dependent on many factors, including what blocks are being ceded. And I would generally say that the difference between the FSA reserve and economic reserve is the greatest for medical business. It has less of a difference for cancer business and the least difference between the reserve levels occurs in the first sector business for WAYS in Tsumitas.

Wilma，思考方式是這樣：如果你看的是整體機會，在會計年度末，Aflac Japan 以 FSA 基礎計算的保單準備金為 10.8 兆日圓。若以此作為起點，這大致就是我們從 Aflac Japan 進行再保分出（ceding）角度的目前再保容量上限。接著，若思考這對資本釋放的影響，能釋放的資本高度取決於多項因素，包括分出的是哪些業務區塊（blocks）。一般而言，FSA 準備金與經濟準備金之間的差異，在醫療業務最大。癌症業務的差異較小，而差異最小的是第一部門業務，例如 Tsumitas 中的 WAYS。

The aging of the blocks ceded matters a lot. The interest rate levels matters a lot. So there's not a great sort of rule of thumb that we can give you. But I would encourage you to go back and look at our fab presentation from 2020, where we gave a level of reserve difference for the total block of in-force business at that point in time. And that gives you an indication of a ballpark number of what that reserve difference could be given the block of business at that point in time.

分出業務區塊的年齡結構（老化程度）影響很大。利率水準也影響很大。因此我們很難提供一個很好的「經驗法則」供你套用。不過我建議你回頭參考我們 2020 年的 fab 簡報，當時我們提供了截至該時點整體有效保單（in-force）業務的準備金差異水準。那能讓你對在當時業務組合下，該準備金差異可能落在什麼樣的區間，有一個概略的指標。

And it's -- I wouldn't say that it's materially different today in terms of the mix compared to back then. But that's what I would look at if I wanted to come up with a rough estimate of what reinsurance capital free up could give us in the future.

而就業務組合而言，我不會說今天與當時相比有實質性的不同。但如果你想對未來再保可能帶來的資本釋放做一個粗略估算，我會建議以那份資料作為參考。

Okay. And then the US and Japan joint efforts to support the yen have any impact on Aflac. And if Japan interest rates ultimately have to increase to support the yen, what impact will that have on Aflac?

了解。另外，美日聯手支撐日圓的行動，對 Aflac 有任何影響嗎？如果日本利率最終必須上升以支撐日圓，對 Aflac 會有什麼影響？

Wilma, this is Brad. Let me comment on that as it relates to the portfolio. Obviously, we've seen a sizable move in the yen. We almost hit 164. I think we're hovering around 158 today.

Wilma，我是 Brad。我就投資組合的角度來回應。顯然我們已看到日圓出現相當大的波動。匯率幾乎到 164。我想今天大約在 158 附近徘徊。

Specific to the portfolio, remember, our US dollar portfolio is part of the larger strategy designed to protect the economic value of Aflac Japan against these kinds of moves in FX. Think of it quite simply is having a pool of yen assets backing currency matched against the offsetting yen liabilities. And then our surplus on behalf of our US dollar shareholders is supported in large part by our unhedged US dollar assets. So any changes in FX move in tandem on both sides of the balance sheet. There's small impact on ESR, but nothing material to speak of. One area we're watching is, as I mentioned earlier, the FX gains from our dollar program have been an important tool for us as we look to reposition the portfolio as the yen strengthens, it does have an impact on these gains. But most of our dollar assets were bought at much lower or much -- I should say, much stronger yen levels.

就投資組合而言，請記得，我們的美元投資組合是更大策略的一部分，目的在於保護 Aflac Japan 的經濟價值，避免受到這類外匯波動的影響。簡單來說，就是以一組日圓資產作為基礎，與相對應的日圓負債進行幣別匹配。而代表美元股東的盈餘（surplus）在很大程度上則由我們未避險的美元資產所支撐。因此，外匯變動會在資產負債表兩端同步反映。對 ESR 會有些微影響，但沒有什麼重大可言。我們正在關注的一點是：如我先前提到，美元計畫帶來的外匯收益一直是我們在重新配置投資組合時的重要工具；當日圓走強時，確實會影響這些收益。不過我們多數美元資產是在日圓更弱、或應該說在日圓更強的水準時買入的。

So we still have a long ways to go there before those gains are eroded. So there really is no other impact from FX to the portfolio.

因此在那些收益被侵蝕之前，還有很長一段距離。所以外匯對投資組合基本上沒有其他影響。

I just wanted to start with one correction. When you go back and look at the reserve difference between FSA and economic reserve, it's not the 2020 fab, it's the 2021 fab. So that's the fab book to look at. The other comment I wanted to make on this topic of FX is that we design and have positioned our foreign exchange hedges for long term protecting the value of -- in our case, Aflac Japan and US dollar terms.

我想先做一個更正。你回頭查看 FSA 準備金與經濟準備金差異時，並不是 2020 年的 fab，而是 2021 年的 fab。所以應該看那一本 fab。另外，關於外匯這個主題我還想補充：我們設計並配置外匯避險，是以長期為出發點，目的是保護價值——以我們的情況而言，就是以美元計價來保護 Aflac Japan 的價值。

That's the ultimate purpose and they are long term in nature, and they play out over a long period of time as well. So in that context, a 4% move, even though dramatic on the day, a 4% move in the yen-dollar exchange rate is actually quite minor in the scheme of things as we -- as our program is taking a very long-term view. So with that in mind, at the moment, this in itself does not necessarily lead us to make any significant changes to our foreign exchange program.

那才是最終目的，而且本質上是長期性的，也會在很長一段時間內逐步展現。因此在那樣的脈絡下，日圓兌美元匯率單日雖然出現劇烈的 4% 波動，但就整體而言其實相當輕微，因為——因為我們的計畫採取的是非常長期的觀點。所以基於這一點，就目前而言，這件事本身不一定會促使我們對外匯計畫做出任何重大調整。

Pablo Singzon, JPMorgan.

Pablo Singzon，摩根大通。

My first question is for MAX. Can you talk about to what extent the benefit ratio in Japan year-to-date will influence your approach to reviewing reserves in the third quarter? I think you had said that elevated ratios being caused by who's lapsing vis-a-vis the newer product. Is that a significant consideration, or is it more of a backward-looking item when you think about assumption updates in 3Q?

我的第一個問題是問 MAX。你能談談日本年初至今的給付率在多大程度上會影響你們在第三季檢視準備金的方法嗎？我記得你曾提到，偏高的比率是由於哪些保單在解約、相對於較新的產品所致。這是一個重要的考量嗎？還是說，當你們在第三季更新假設時，這比較像是一個回顧性的項目？

Yes. I had a little bit of trouble hearing you, but I think the question is around the benefit ratio for Japan for the first half and what we expect going into the second half and also any expectations on the actuarial assumption review that will take place in the third quarter. So in the -- obviously, in the first half, our benefit ratio has been a little bit higher than what we expected, and we have called that out. We still expect to be inside of our full year guidance range of 60% to 63%. But we now expect to be at the upper end of that range.

是的。我聽你說話有一點吃力，但我想問題是關於日本上半年給付率，以及我們對下半年的預期，還有第三季將進行的精算假設檢視的任何預期。所以在——很明顯地，上半年我們的給付率比我們預期的略高，我們也已經特別指出。我們仍預期全年會落在我們指引區間 60% 到 63% 之內。但我們現在預期會在該區間的上緣。

The main reason that is sort of pushing us a little bit higher is the type of lapses that are occurring. We have seen less lapsation of older policies and older policies, obviously have -- they've been on our books for a long period of time, have accumulated and built up quite significant reserves. So when those policies lapse, that reserve is being released through the benefit ratio, pushing it down significantly. We have seen an increase in more recently issued policies that haven't handed that same level of reserve being built up. And therefore, when they are being lapsed, then there's not a significant push down on the benefit ratio.

主要使我們略為偏高的原因，是目前發生的解約類型。我們看到較少舊保單解約，而舊保單顯然——它們在我們帳上已經存在很長一段時間，累積並建立了相當可觀的準備金。因此當那些保單解約時，準備金會透過給付率釋放，顯著地把給付率往下拉。我們看到較近期核發的保單解約增加，而這些保單尚未累積到同樣水準的準備金。因此當它們解約時，對給付率的下拉效果就不顯著。

So the mix impact of lapsation have played a role here. And that means that the benefit ratio has not benefited as much as we previously expected. This is driven by our lapse and reissue program, and it is driven by the cancer product. Obviously, Miraito. As Miraito matures and now is more than a year through its lifetime, we would expect this lapse and reissue activity to normalize and that also means that we would expect the mix impact between older and more recently issued cancer products as it relates to lapsation to normalize as well.

所以解約組合的影響在這裡扮演了角色。這也意味著給付率沒有像我們先前預期那樣受益。這是由我們的解約與再投保（lapse and reissue）計畫所驅動，也受到癌症產品所驅動。很明顯地，是 Miraito。隨著 Miraito 成熟、且推出已超過一年，我們預期這類解約與再投保活動會趨於正常化；這也表示，我們預期在解約方面，舊款與較近期核發的癌症產品之間的組合影響也會一併正常化。

And that's what gives us confidence that we will come back inside of the benefit ratio range of 60% to 63% in the second half. As it relates to the third quarter assumption review, that is something that we are working on right now, and we will report out in the third quarter. And as always, we are trying to set all the assumptions especially our forward-looking assumptions with our best estimate, and we do that to the best of our ability to make sure that we reflect the reserves as best as we can.

這就是我們有信心在下半年回到 60% 到 63% 的給付率區間之內的原因。至於第三季的假設檢視，我們目前正在進行，並會在第三季對外報告。一如既往，我們會盡力以最佳估計來設定所有假設，特別是前瞻性假設；我們也會盡最大努力，確保準備金的反映盡可能貼近實際。

And then second question, what is your outlook for your reinsurance initiative? It seems like there's a lot of opportunity there in Japan, and you should just grow fast naturally from a ceding start. But any perspective on how large this might be for you in the medium term?

第二個問題，你們對再保計畫的展望如何？看起來日本有很多機會，而且從分出業務（ceding）的起點出發，你們應該可以自然地快速成長。但就中期而言，你們怎麼看這項業務對你們可能會有多大規模？

So, so far, we have executed one external transaction, and we're very pleased with that, and it's progressing well. We think that this is a significant market. We think that we have some particular competitive advantages, and we intend to leverage that to the best of our ability. This is a very lumpy business, so you should not expect us to announce or write any business every quarter. This is more of an annual cycle.

到目前為止，我們已執行了一筆對外交易，我們對此非常滿意，而且進展順利。我們認為這是一個重要的市場。我們認為我們具備一些特定的競爭優勢，並打算盡我們所能加以運用。這是一門非常不均勻（lumpy）的業務，所以你不應期待我們每一季都會宣布或承作任何業務。這比較是一個年度循環。

So it's something that will build up over time. But long term, I think this is a business that fits us very well. And I think that we have a very good product that we can offer to the marketplace. So long term, we think this is going to be a significant business for Aflac. But I don't think it's going to overtake our primary business in US and Japan, but it will be a very, very good supplemental business for us.

所以這會隨時間逐步累積。但從長期來看，我認為這是一項非常適合我們的業務。而且我認為我們有一個非常好的產品可以提供給市場。因此長期而言，我們認為這將會成為 Aflac 的一項重要業務。但我不認為它會超越我們在美國與日本的核心主業，不過它會是我們非常、非常好的補充性業務。

This concludes our question-and-answer session. I would like to turn the conference back over to David Young for any closing remarks.

問答環節到此結束。我想把電話會議交回給 David Young，請他做任何結語。

Thank you. And please, mark your calendars for December 3 and join us for our financial analyst briefing. We will be getting more details out in regard to that. If you have any questions, please follow up with Investor and Rating Agency Relations, and we look forward to talking to you soon. And again, thank you for joining us this Friday. Have a great one.

謝謝。也請各位把 12 月 3 日記在行事曆上，並參加我們的金融分析師說明會。我們會就此提供更多細節。如果你有任何問題，請與投資人與評等機構關係部門聯繫，我們期待很快再與各位交流。再次感謝各位在這個星期五加入我們。祝各位一切順利。

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

本次電話會議現已結束。感謝各位出席今天的簡報。您現在可以掛線。

Portions of this transcript that are marked (interpreted) were spoken by an interpreter present on the live call. The interpreter was provided by the company sponsoring this event.

本逐字稿中標示為（interpreted）的部分，是由現場電話會議中的口譯員所轉述。該口譯員由主辦本活動的公司提供。