INVESTOR RELATIONS

Corporate Planning Division, Samsung Fire & Marine Insurance. Co., Ltd.

Samsung Insurance Bldg. 87, Euljiro -1ga, Jung-gu, Seoul, Korea,100-782E-mail: ir.samsungfire@samsung.comTelephone: 82-2-758-7535Facsimile: 82-2-758-7831

View our interactive on-line annual report atir.samsungfire.com

THINK NEXT

BRAND STRATEGY

FINANCIAL HIGHLIGHTS

2009 AT A GLANCE

MESSAGE FROM THE CEO

CORPORATE DIRECTORY

CORPORATE GOVERNANCE

REVIEW OF OPERATION

AUTOMOBILE INSURANCE

LONG-TERM INSURANCE

COMMERCIAL INSURANCE

ENTERPRISE RISK MANAGEMENT

SUSTAINABILITY MANAGEMENT

ETHICAL MANAGEMENT

ENVIRONMENT MANAGEMENT

CORPORATE SOCIAL RESPONSIBILITY

SPORTS

CULTURE

FINANCIAL SECTION

MD&A

FINANCIAL STATEMENTS

WORLDWIDE NETWORK & SAMSUNG AFFILIATES

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14

16

18

22

23

34

36

38

40

44

46

48

50

52

56

65

120

CONTENTS

An

nu

al Rep

ort

20

09

TH

E G

LO

BA

L P

ION

EE

R

We always care our customers and shareholderswww.samsungfire.com http://ir.samsungfire.com

This report is printed on an Fsc certified paper in Soyink

삼성화재-표지0917.ps 2010.9.17 10:42 PM 페이지1 CTP-4

SAMSUNG AFFILIATES

Samsung Fire & Marine Insurance Co., Ltd.

has affiliates in the Samsung Group which includes the below companies.

Finance

Samsung Fire & Marine Insurance Co., Ltd.

Samsung Life Insurance Co., Ltd.

Samsung Card Co., Ltd.

Samsung Securities Co., Ltd.

Samsung Asset Management

Samsung Venture Investment Corporation

Samsung CorporationSamsung Engineering Co., Ltd.Cheil Industries Inc.Samsung Everland Inc.The Shilla Hotels & ResortsCheil Communications Inc.S1 CorporationSamsung LionsSamsung Medical CenterSamsung Economic Research InstituteSamsung Advanced Institute of TechnologySamsung Foundation of CultureSamsung Welfare Foundation

Samsung Heavy Industries Co., Ltd.

Samsung Techwin Co., Ltd.

Finance Other Samsung Companies

Samsung Electronics Co., Ltd.

Samsung SDI Co., Ltd.

Samsung Electro-Mechanics Co., Ltd.

Samsung Corning Co., Ltd.

Samsung Corning Precision Glass Co., Ltd.

Samsung SDS Co., Ltd.

Samsung Networks Inc.

Samsung Total Petrochemicals Co., Ltd.

Samsung Petrochemical Co., Ltd.

Samsung Fine Chemicals Co., Ltd.

Samsung BP Chemicals Co., Ltd.

Electronics Chemicals

Machinery

Jan

uary

26, 1952

Foun

ded

as A

nbo

Fire

& M

arin

e In

sura

nce

Co.

, Ltd

.

Jan

uary

31, 1963

Acq

uire

d A

nkuk

Fire

& M

arin

e In

sura

nce

Co.

, Ltd

.

Marc

h 2

, 1963

Com

pany

nam

e ch

ange

d to

Ank

uk F

ire &

Mar

ine

Insu

ranc

e C

o., L

td.

1952SAMSUNG FIRE & MARINE INSURANCESTORY BEGAN... 2010

1950s

1960s

Ju

ne 1

, 1975

Initi

al P

ublic

Offe

ring

Feb

ruary

24, 1978

Ope

ned

offic

es in

Mas

an, D

ongb

u (e

ast),

Nam

bu (s

outh

)

Feb

ruary

4, 1979

Est

ablis

hed

a ris

k m

anag

emen

t ins

titut

e-a

first

amon

g K

orea

n no

n-lif

e in

sure

rs

Octo

ber

1, 1983

Laun

ched

aut

o in

sura

nce

divi

sion

Sep

tem

ber

1, 1985

Ope

ned

offic

e in

New

Yor

k (U

.S.)

Octo

ber

17, 1987

Con

stru

ctio

n of

hea

d of

fice

build

ing

com

plet

ed

May 2

6, 1989

Incr

ease

d ca

pita

l to

KR

W8.

4 bi

llion

1970s

1980s

Feb

ruary

10, 1990

Incr

ease

d ca

pita

l to

KR

W10

.0 b

illion

Marc

h 1

7, 1990

Incr

ease

d ca

pita

l to

KR

W11

.7 b

illion

Ap

ril 1, 1990

Ope

ned

bran

ch in

U.S

.

May 2

9, 1990

Incr

ease

d ca

pita

l to

KR

W12

.8 b

illion

Ap

ril 1, 1992

Ope

ned

Seo

ul C

usto

mer

Ser

vice

Cen

ter

Marc

h 2

6, 1993

Sel

ecte

d as

dom

estic

lead

man

ager

for

Kor

easa

t Ins

uran

ce

No

vem

ber

29, 1993

Ope

ned

Jaka

rta

offic

e (In

done

sia)

Decem

ber

6, 1993

Com

pany

nam

e ch

ange

d to

Sam

sung

Fire

&

Mar

ine

Insu

ranc

e C

o., L

td.

Jan

uary

10, 1994

Ope

ned

offic

e in

Tok

yo (J

apan

)

May 9

, 1994

Ope

ned

Yus

eong

Tra

inin

g C

ente

r

Octo

ber

20, 1994

Laun

ched

Soc

ial S

ervi

ce T

eam

of S

F&M

I

Ap

ril 20, 1995

Ope

ned

Bei

jing

offic

e (C

hina

)

Ju

ly 1

5, 1995

Ope

ned

offic

e in

Ho

Chi

Min

h C

ity (V

ietn

am)

Au

gu

st

28, 1996

Ope

ned

offic

e in

Han

oi (V

ietn

am)

Sep

tem

ber

20, 1996

Ope

ned

offic

e in

Sha

ngha

i (C

hina

)

No

vem

ber

7, 1996

Est

ablis

hed

a lo

cal s

ubsi

diar

y in

Indo

nesi

a

1990s

1990~

1993

1994~

1996

Ap

ril 4, 1998

Incr

ease

d ca

pita

l to

KR

W14

.8 b

illion

Octo

ber

15, 1998

Est

ablis

hed

Sam

sung

Fire

& M

arin

e In

sura

nce

Cla

imA

djus

tmen

t Ser

vice

Co.

, Ltd

.

Jan

uary

19, 1999

Incr

ease

d ca

pita

l to

KR

W20

.0 b

illion

Ju

ly 3

, 1999

Sto

ck s

plit

to K

RW

500

per

valu

e

1997~

1999

Jan

uary

30, 2000

Incr

ease

d ca

pita

l to

KR

W25

billi

on

May 3

0, 2000

Pai

d di

vide

nd o

n ac

coun

t of c

apita

l inc

reas

Ap

ril 24, 2001

Ope

ned

bran

ch in

Sha

ngha

i (C

hina

)

Ju

ly 1

, 2001

Est

ablis

hed

Sam

sung

Tra

ffic

Saf

ety

Res

earc

h In

stitu

te

Decem

ber

31, 2001

Sel

ecte

d as

one

of A

sia’

s “T

op 2

00 C

ompa

nies

” by

the

Far

Eas

tern

Eco

nom

ic R

evie

w, a

Hon

g K

ong-

base

d po

litic

al a

nd e

cono

mic

wee

kly

mag

azin

e

Jan

uary

18, 2002

Dec

lare

d 20

02 a

s th

e fir

st y

ear

for

“Sam

sung

Fire

& M

arin

eIn

sura

nce

Eth

ical

Man

agem

ent”

Jan

uary

26, 2002

Unv

eile

d tim

e ca

psul

e in

com

mem

orat

ion

of th

e 50

th a

nniv

ersa

ry o

fth

e co

mpa

ny

Ap

ril 2, 2002

Laun

ched

Sam

sung

“an

ycar

” au

to in

sura

nce

bran

d

Ap

ril 26, 2002

Won

the

“Mos

t Res

pect

ed p

rope

rty/

casu

alty

Insu

rer

Aw

ard”

at

“The

Firs

t in

Kor

ea”

awar

ds s

pons

ored

by

Kor

ea M

intin

g an

dS

ecur

ity P

rintin

g C

orpo

ratio

n

No

vem

ber

14, 2002

Est

ablis

hed

“Sam

sung

Vin

a In

sura

nce

Com

pany

Lim

ited

(SV

IC)”

as

a lo

cal s

ubsi

diar

y in

Vie

tnam

Marc

h 2

6, 2003

Sel

ecte

d as

the

“fai

rest

trad

er”

by K

orea

Fai

r Tr

ade

Com

mis

sion

May 2

6, 2003

Ope

ned

offic

e in

Qin

gdao

(Chi

na)

Decem

ber

10, 2003

Laun

ched

Sam

sung

Sup

er In

sura

nce,

the

indu

stry

’s fi

rst i

nteg

rate

din

sura

nce

prod

uct

Decem

ber

30, 2003

Sig

ned

an M

OU

for

Coo

pera

tion

and

Exc

hang

e w

ith C

hina

Pric

eIn

form

atio

n N

etw

ork,

a C

hine

se in

sure

r

Au

gu

st

19, 2004

Intr

oduc

ed “

Soc

ially

Con

trib

utin

g B

rand

” a

first

in th

e in

dust

ry

Au

gu

st

19, 2004

Cha

ngin

g its

nam

e in

to “

Sam

sung

Any

car

Soc

ial S

ervi

ce T

eam

”

Jan

uary

3, 2005

Ope

ned

Sam

sung

Los

s C

ontr

ol C

ente

r, th

e fir

st o

f its

kin

d in

the

hist

ory

of th

e pr

ivat

e se

ctor

Ap

ril 25, 2005

Est

ablis

hed

Sam

sung

Fire

& M

arin

e In

sura

nce

(Chi

na),

the

first

loca

l sub

sidi

ary

esta

blis

hed

by a

fore

ign

insu

rer

in C

hina

Ju

ne 3

0, 2005

Cer

emon

y of

“K

RW

500

Gift

Hop

e” P

rese

nt

Ju

ly 2

2, 2005

Ope

ned

offic

e in

Lon

don

(U.K

.)

Sep

tem

ber

30, 2005

Laun

ched

“A

llife”

as

a fla

gshi

p br

and

for

long

-ter

m in

sura

nce

Ap

ril 4, 2006

Intr

oduc

ed th

e sl

ogan

“Li

ving

Insu

ranc

e” in

long

-ter

min

sura

nce

Ju

ly 2

7, 2006

Ope

ned

Bei

jing

offic

e of

Chi

na s

ubsi

diar

y

No

vem

ber

27, 2006

Unv

eile

d th

e M

etro

Pol

e 50

, a n

eon

scul

ptur

e

No

vem

ber

29, 2006

Won

“P

resi

dent

ial A

war

d” a

t “K

orea

Bra

nd A

war

ds”

Decem

ber

1, 2006

SF&

MI w

on th

e H

uman

Rig

ht P

rize

for

Dis

able

d P

eopl

e

Decem

ber

12, 2006

Rec

eive

d “P

resi

dent

ial C

itatio

n” a

t the

Firs

t and

For

emos

tM

ovem

ent f

or P

erso

ns w

ith D

isab

ilitie

s A

war

ds

Decem

ber

20, 2006

Won

“P

resi

dent

ial A

war

d” a

t the

“D

igita

l Kno

wle

dge

Man

agem

ent A

war

ds”

Jan

uary

9, 2007

Sam

sung

Tra

ffic

Saf

ety

Res

earc

h In

stitu

te (S

TSR

I) re

ceiv

ed“S

amsu

ng A

war

d of

Hon

or”

Jan

uary

18, 2007

Nam

ed a

n “A

sian

Fab

50”

com

pany

in th

e A

sia

Pac

ific

Reg

ion

by F

orbe

s

Feb

ruary

21, 2007

Ope

ned

Rai

lroad

Win

g at

the

Sam

sung

Tra

nspo

rtat

ion

Mus

eum

Decem

ber

21, 2007

Ope

ned

She

nzhe

n of

fice

of C

hina

bra

nch

2000s

2000~

2004

2005~

2007

Ju

ly 1

0, 2008

Ope

ned

Suz

hou

offic

e of

Chi

na s

ubsi

diar

y

No

vem

ber

20, 2008

Ope

ned

the

first

FP

Cen

ter

in th

e in

dust

ry

Decem

ber

12, 2008

Ope

ned

offic

e in

Sin

gapo

re

Feb

ruary

26, 2009

Ope

ned

Qin

gdao

offi

ce o

f Chi

na s

ubsi

diar

y

Marc

h 3

, 2009

Laun

ched

Inte

rnet

aut

o in

sura

nce

serv

ice

Ap

ril 23, 2009

Est

ablis

hed

an o

ffice

in In

dia

Ju

ly 1

, 2009

Laun

ched

Any

Hom

e G

ener

al In

sura

nce

Sep

tem

ber

15, 2009

Ope

ned

a su

bsid

iary

in B

razi

l

2008~

2009

Ap

ril 15, 2010

Cer

emon

y fo

r th

e 10

0th

hous

e of

“K

RW

500

Gift

of H

ope”

Ju

ne 2

1, 2010

Sig

ned

a co

mpr

ehen

sive

bus

ines

s tie

-up

deal

with

H

uata

i Ins

uran

ce o

f Chi

na.

Ju

ly 1

, 2010

Ann

ounc

ed a

New

Bra

nd S

loga

n, “

thin

k N

EXT

”

Ju

ly 1

4, 2010

Mad

e ou

r fir

st d

onat

ion

for

the

esta

blis

hmen

t of

“Hap

py S

choo

l”

2010

CORPORAT

EHIS

TORY

LIAISON OFFICES

Japan (Tokyo)SAMSUNG FIRE & MARINE INSURANCE CO., LTD.,

TOKYO LIAISON OFFICE

Roppongi T-CUBE 3-1-1, Roppongi, Minato-Ku, Tokyo 106-8532, JapanTelephone : 81-3-6234-2208 Facsimile : 81-6234-2207

China (Beijing)SAMSUNG FIRE & MARINE INSURANCE CO., LTD.,

BEIJING REPRESENTATIVE OFFICE

25F China Merchants Tower No.118, jianguolu, Chaoyang District, Beijing, China 100022Telephone : 86-10-6566-8100 Facsimile : 86-10-6566-9408

China (Qingdao)SAMSUNG FIRE & MARINE INS.

CHINA, QINGDAO BRANCH

Rm 907, Flagship Tower New World Cyberport, 40, Hongkong Middle Road, Qingdao 266071, ChinaTelephone : 86-532-8502-7271 Facsimile : 86-532-8502-8248

U.K. (London)SAMSUNG FIRE & MARINE INSURANCE CO., LTD.

LONDON REPRESENTATIVE OFFICE

21st Floor, Tower 42, 25 Old Broad Street, EC2N 1HP, London UNITED KINGDOMTelephone : 44-207-786-7851~4 Facsimile : 44-207-786-7866

IndiaSAMSUNG FIRE & MARINE INSURANCE CO., LTD.,

INDIA REPRESENTATIVE OFFICE

122-009 2nd Floor, Samsung Electronics, Vipul Tech Square, Golf course road, Sector 43 GurgaonHaryana, IndiaTelephone : 91-124-488-1234-2060 Facsimile : 91-124-488-2090

SingaporeSAMSUNG FIRE & MARINE INSURANCE CO., LTD.,

SINGAPORE REPRESENTATIVE OFFICE

3 Church Street #21-05 Samsung Hub Building, Singapore 049483Telephone : 65-6550-8112 Facsimile : 65-6550-8115

120 121Financial Section Worldwide Network & Samsung Affiliates

BrasilSAMSUNG FIRE & MARINE CONSULTORIA EM SEGUROS LTDA

Av. Das Nacoes Unidas, 12901- Torre Oeste 22 andar- Brooklin Novo S.o Paulo SP Brasil 04578-910Telephone : 55-11-5105-5040 Facsimile : 55-11-5105-5041

삼성화재-표지0917.ps 2010.9.17 10:42 PM 페이지2 CTP-4

Service that surpasses customer expectations.Industry leading corporate capabilitiesfocused on the market and customers.Implementation of new processesfor better customer convenience.All of these begin from the Innovation of SF&MI.SF&MI’s “think NEXT”, through whichSF&MI is moving forward to becominga total financial service company, isthe spirit of innovation.

In order to grow into a global leader, SF&MI has laid the foundation inemerging markets, such as China, Vietnam and Indonesia. SF&MI’s innovation is helping us leap forward to becoming a first-classglobal company.

“NETWORK”

“ENVIRONMENT”

SF&MI strives to improve and protect the environment.SF&MI’s innovation is creating a first-class company thattranscends the ages.

“CONNEXION”

From start to finish, SF&MI constantly strives to understandcustomers from their viewpoint, and use our innovation to maximizecustomer satisfaction.

“TREND”

Staying one step ahead of its competitors, SF&MI’s brand hasalways taken the lead. SF&MI’s innovation realizes the amazingvalue creation of its brand.

BRAND STRATEGYSince President Chi took office in July, 2008, SF&MI has strived to execute itsnew growth strategy in order to evolve into a service company that surpassesthe limits of a non-life insurance company, while further sticking to the basics ofmarket and customer oriented management. To this end, we have developed abrand strategy to focus our customer communication on practical innovativeefforts and performance.

Accordingly, SF&MI announced a new brand philosophy entitled “think NEXT”based on the immense innovation activities sweeping all sectors, includingproducts, services and corporate culture.

“think NEXT” represents SF&MI’s spirit of “innovation (proposing new insuranceideas to customers first and being the first to put these into practice).” Thisbrand philosophy declares that SF&MI is Korea’s best insurance and financialcompany, and one which thinks about a better future for its customers andoffers superior insurance products without resting on its laurels. The brandphilosophy also expresses our determination to develop into one of the globaltop 10 insurance companies by 2020.

think NEXTSF&MI Starts Again.For our Customers’ TomorrowFor the Future of Insurance

365 Days R&D “Make Strenuous and Continuous Efforts for Customers”SF&MI’s innovation begins by focusing our efforts on the market and our customers. Our ceaseless efforts to provide qualityproducts and services that our customers really need and evolve into a total financial service company that goes beyond that of justan insurer will be the driving force behind SF&MI’s true innovation.

365% Satisfaction “Surprise Customers”SF&MI’s innovation is providing extraordinary service that satisfies customers in ways they would never expect. We are movingtoward becoming a service company that maximizes customer satisfaction and offering much more than basic services that ourcustomers expect.

36.5° System “Change Everything for the Convenience of Customers”SF&MI’s innovation is in the power of execution, which changes business practices for the convenience of customers, such asputting an end to old practices and resolutely getting rid of procedures.

We will carry out effective communication by expressing the meaning and feeling of the “think NEXT” brand on the basis of this spiritof innovation via the following brand identity system.

DIRECTION OF INNOVATION

365% Satisfaction“Service Capabilities that ExceedCustomers’ Expectations”

A service company that satisfiescustomers in ways they do notexpect

A creative company that changesbusiness practices for ourcustomers’ convenience

A market driven companywhich takes the lead whilefocusing on the market andcustomers.

Market DrivenCompany Innovation

for the future

CreativeCompany

ServiceCompany

36.5° System“Process Capabilities that MaximizeCustomers’ Convenience”

365 Days R&D“Insurance/Financial Capabilities thatExceed Customers’ Needs”

Launched as the first branded auto insurance in Korea in 2002, SF&MI’s “anycar” has since earned an undisputed leadershipposition in the industry through proactive communications with customers, and hailed as a new, viable model of brand developmentand customer service enhancement for financial companies.

Since announcing its “auto insurance consulting service,” a first in the industry, “anycar” has been providing customized autoinsurance services designed by a specialized consulting sales force of risk consultants (RC). In addition, in order to reinforce thebrand’s leadership, we have maintained the largest compensation network in the industry, enabling the speediest settlement ofclaims. More than a mere insurer, we aim to be an “auto life consultant” that takes care of every aspect of car ownership and usage.

We have extended our services to bring about a full spectrum of benefits to our customers even on a global level. For instance, werecently signed an agreement with Farmers Insurance Group, a Los Angeles based automobile insurer, to ensure that“anycar”premium customers can enjoy the same level of benefits in the U.S.

Samsung “anycar”, the Finest Auto Insurance in Korea.

SF&MI STARTS AGAIN.FOR OUR CUSTOMERS’ TOMORROWFOR THE FUTURE OF INSURANCE

SF&MI surpassed KRW10 trillion in direct premiums written and KRW1 trillion won in investment profits, a first for anon-life insurer in Korea, while posting KRW524.5 billion in net profit through stable asset management andenhancement of managerial efficiency. Furthermore, our total assets rose by KRW3,563.7 billion to KRW26,655.9billion, while our catastrophe reserves increased by KRW73.5 billion, making SF&MI a financially stronger company.

FINANCIAL HIGHLIGHTS

Samsung Fire & Marine InsuranceAnnual Report 2009

Direct Premiums Written

Increase in Catastrophe Reserves

Investment Profit

Operating Profit

Adjusted EPS (in KRW)

11.8%

1.2%

13.8%

-15.3%

-11.0%

Summary ofIncomeStatements

Summary ofFinancialPosition

10,89574

1,010

725

13,707Cash & Equivalents

Stocks

Real Estate

Total Assets

Total Liabilities

Solvency Margin Ratio

-49.1%

38.9%

0.5%

15.4%

12.9%

51.6%p

303.2

2,7431,093

26,656

21,716

426.4%

(In billions of Korean Won)

(In billions of Korean Won)

014 015think NEXT Financial Highlights

20,741

23,092

26,656

Total Assets(In billions of Korean Won)07 08 09

07 08 09

07 08 09

477

599

525

703

888

1,010

Net Profit(In billions of Korean Won)

Investment Profit(In billions of Korean Won)

OCT. 16, 2009/Production of a Drama Designed to Improve People’sUnderstanding of Disability

SF&MI contributed to the improvement of students’ understanding ofdisability by producing and distributing “Good Friends,” a drama designedto improve people’s understanding of disability in schools. This drama wascreated in cooperation with the Ministry of Education, Science andTechnology (Minister Byung-man Ahn) and “First and Foremost Movementfor Disabled People” (Chairman Soo-sung Lee).

NOV. 2, 2009/Held 2009 Junior Global Leaders Forum

SF&MI successfully completed the final competition of the “2009 JuniorGlobal Leaders Forum” as part of a program to nurture global teenagetalents. Approximately 30 students from across the nation took part in thefinal, held at SF&MI’s Yuseong Training Center, to give presen-tations andhold discussions on global issues. The event was held in order to provideteenagers opportunities to nurture their dreams and feel the value ofsharing as a global citizen under the slogan “Speak to the World”. Despitebeing the program’s first year, approximately 26,000 elementary andmiddle school students from all over the country participated, making it thenation’s biggest English language competition.

DEC. 22, 2009/Guide Dog Donation Ceremony

Approximately 150 people attended the ceremony including Dae-Sub Chi,president of SF&MI, six visually challenged people who are to receive guidedogs and volunteers who took care of the guide dog candidates for a year.The six visually challenged people included Ji-Won Seon, an 18-year-oldfreshman from the Special Education Department at Daegu University,whose sister, Myeong-Ji Seon, also received a guide dog in June 2008.“We hope that these seven guide dogs will be a big helping hand for thesepeople.” said an employee of SF&MI. He added, “In the future, thedonation of guide dogs will continue as part of our social contributionactivities.”

DEC. 30, 2009/Receiving Good Evaluations from World-Class Credit RatingAgencies

SF&MI recently received good evaluations from world-class credit ratingagencies such as A.M. Best and S&P. SF&MI announced that it hadobtained an A+ (Superior) grade from A.M. Best, the world’s biggest creditrating agency specializing in evaluating the credit of insurance firms. Thecredit rating outlook for SF&MI jumped from ‘Stable’ to ‘Positive’, allowing usto take one more step towards becoming a top global insurance company.Furthermore, SF&MI received an A+(Stable) grade from S&P (Standard &Poor's) for the seventh straight year.

2009 AT A GLANCE

Samsung Fire & Marine InsuranceAnnual Report 2009

2009

MAR. 3, 2010/myanycar Surpasses KRW10 Billion in Monthly Sales

SF&MI announced on March 2 that it posted KRW10.8 billion in sales forthe internet auto insurance, myanycar, in February. As a result, sales ofmyanycar have surpassed KRW10 billion in just one year since its launch.Sales of myanycar, as of the end of February, totaled approximately140,000 insurance contracts and KRW78 billion in insurance premiums.The accumulated sales for the first 12 months after launch ranks secondamong online insurers, following that of Axa Direct in 2001.This performance is particularly meaningful considering the fact thatmyanycar’s entire sales process is done via internet. myanycar offers itsonline customers the same claims service as SF&MI’s regular autoinsurance customers who purchased their insurance through its agents.

APR. 19, 2010/Opening of the 100th House of “KRW500 Gift of Hope”

Risk consultants (RC) of SF&MI and a volunteer group, the “First andForemost Movement for Disabled People”, have co-hosted a project toimprove the living conditions of handicapped people through the “KRW500Gift of Hope” fund. This program recorded its 100th house of “KRW500 Giftof Hope” in April 2010, and has raised KRW1.8 billion in funds anddelivered gifts of hope to 85 households and 15 organizations up till now.Currently, approximately 21,000 risk consultants (RC) are taking part in thecampaign. “Hangeoleum,” the 100th organization to benefit from thisprogram, is a welfare facility for approximately 40 handicapped infants andchildren. SF&MI and the volunteer group laid special flooring and installedsafety facilities in bathrooms to improve its safety.

MAY 31, 2010/Signing of an Agreement to Promote “Happy School”

SF&MI held a signing ceremony with the Safe Kids Korea Foundation onMay 28 for the “Happy School” campaign, which is designed to preventchild automobile accidents.The campaign is designed to protect junior students at elementary schoolsby supporting one school a month after researching the number ofautomobile-related accidents in the vicinity. The program is meaningful as itcan expand the social contribution projects of risk consultants (RC) furtherin connection with auto insurance, following the successful establishmentof the “KRW500 Gift of Hope” fund.

JUN. 21, 2010/Made a Foray into China’s Auto Insurance Market

SF&MI (President Dae-Sub Chi) announced that the non-life insurer hasmade inroads into the Chinese auto insurance market by signing abusiness tie-up deal for auto insurance with Huatai Insurance, a Chineseinsurer, on June 21. Through this partnership, SF&MI is expected to breakthrough Chinese insurance regulations which do not allow a foreign insurerto provide liability insurance in China. SF&MI’s subsidiary in China currentlyhas its headquarters in Shanghai and four branches in Beijing, Qingdao,Shenzhen and Suzhou, securing the largest sales network in China amongforeign insurers. Furthermore, SF&MI maintains an ‘A’ credit rating withStandard and Poor’s, the highest among insurers in China.

JUL. 1, 2010/Announced a New Brand Slogan, “think NEXT”

SF&MI changed its brand slogan from “Happy Forever” to “think NEXT” andhas conducted internal and external communications activities since July.The brand slogan is designed to express our future core corporate values.The new slogan, “think NEXT” contains the spirit of “Innovation,” the corebrand identity (BI) of SF&MI, which perfectly highlights SF&MI’s aim tointroduce and practice new ideas in the future. SF&MI announced that byusing the new brand slogan as a momentum, it will realize its vision tobecome a top 10 global non-life insurer by 2020.

016 017think NEXT 2009 At a Glance

2010

MESSAGE FROM THE CEO

I would like to deliver

my heartfelt appreciation

to our shareholders

for their unwavering

support and encouragement

to Samsung Fire & Marine

Insurance (SF&MI)

amidst the difficulties

of the global

economic crisis.

Samsung Fire & Marine InsuranceAnnual Report 2009

Dear respected shareholders of SF&MI.

I would like to express my deepest appreciation to all of you for your continued support for SF&MI.

The fiscal year 2009 witnessed the global economy rise from the debris of the global financial crisis as joint global stimulus packages

and fiscal expenditure by major economies stabilized financial markets.

On the domestic front, despite lingering unemployment, the real economy picked up on the strength of robust exports and the

government’s economic stimulus packages. In the non-life insurance business, the introduction of standardized long-term insurance

policies triggered intense competition. As a result, competition for market dominance intensified more than ever.

Despite these difficult business environments, SF&MI realized a strong 11.8% year-on-year growth in direct premiums written to

reach KRW10,895.1 billion and KRW524.5 billion in net income for FY2009. These remarkable achievements can be attributed to

SF&MI’s stable and efficient asset management. Furthermore, total assets surged KRW3,563.7 billion to total KRW26, 655.9 billion,

while an additional KRW73.5 billion was added to our catastrophe reserve, thereby further strengthening our financial soundness.

These strong performances were widely recognized, with SF&MI earning an A+ credit rating from the world renowned credit rater

S&P, for the seventh consecutive year. In addition, SF&MI was ranked top in an NCSI evaluation for the ninth year in a row, as well as

being named “an excellent financial company in customer rights protection” by the Financial Supervisory Service-a clear indication of

our position as Korea’s leading insurer.

While realizing this economic success, commitment to our social responsibilities continued through various community engagement

programs. These programs included the “KRW500 Gift of Hope” fund, a volunteer program conducted by our risk consultants (RC)

that is designed to improve the living conditions of disabled citizens. In 2009, this program celebrated its 100th project, a remarkable

achievement when considering the program was only launched five years ago. Starting this year, we aim to further expand funding

sources. This will include making a donation every time a new car insurance policy is signed in the aim of preventing child road

accidents.

Our Respected Shareholders!

Despite signs of an economic recovery, further uncertainty is forecast for the global economy in FY2010 due to major European

economies struggling in the aftermath of the financial crisis and the possibility of exit strategies being introduced by major economies

around the world. Meanwhile, rising oil and commodity prices and increasing household debt continue to pose a threat to the

domestic economy.

In the insurance business, distribution channels diversified and non-exclusive channels increased their influence. Therefore, only a

company possessing differentiated channel capabilities and boasting competitive prices will be in a position to take the lead in the

market.

Against this backdrop, SF&MI aims to overcome the rapidly-changing business environment and adverse business conditions

through ceaseless innovation and creative thinking. Through creativity, innovation and entrepreneurship, SF&MI will put into action the

following tasks in order to realize our vision of becoming one of the top 10 global insurers by 2020.

018 019think NEXT Message from the CEO

2020Global Top 10

• Sales : KRW15.5 trillion• Domestic M/S 30%• Ratio of overseas sales 3%

• Enlarge domestic market• Strengthen R&D• Successful penetration into

overseas markets

• Highest level in Korea• Create capabilities for global

business

• Sales : KRW21 trillion• Maintain market dominance• Ratio of overseas sales 15%

• Expand business in the financialservices area

• Commercialization of 5main R&Dareas

• Active cross border M&A

• Apply core competencies toglobal business

• Reinforce global managementcapabilities

• Sales : KRW30 trillion• Maintain market dominance• Ratio of overseas sales 20%

• Provide a wide range of products(Insurance + Finance +Service)

• Apply R&D capabilities to overseasmarket

• Entry into developed market

• Achieve global top level• Completion of global

management capabilities

(Total Risk Solution Partner)

2020 Sales KRW24 trillion(80%)

•2012 Achieve M/S 30%

•Business in 5 Main R&D Areas

2020 Sales KRW6 trillion(20%)

•Sucessful penetration into overseas markets

•Expand through M&A

Korea Overseas

Sales KRW30 trillion, Assets KRW100 trillion

VISION 2020

ROAD MAP TO GLOBAL TOP 10

Stage 1(~2012)Build strong basis for growth

Stage 2(~2015)Active growth

Stage 3(~2020)Global top level

Global Top 20

Global Top 15

Global Top 10

Co

reC

om

pet

ency

Mar

ket

Tar

get

Samsung Fire & Marine InsuranceAnnual Report 2009

First, we will strengthen our competences so that they will be on par with those of leading global companies.

All employees of SF&MI are committed to creating global leading competences in every aspect of our products, services and

corporate culture. At the very forefront of global market trends, we will continue to make strides in innovation in order to ensure

a brighter future as a leading global company.

Second, SF&MI will transform into a customer-oriented company.

Customer and market-oriented management is the ultimate goal of all our business practices. Aiming to create ten million

customers, we will provide sincere services that are beyond their expectations, providing assistance whenever and wherever

our customers need it.

Third, we will weave creativity, innovation and challenge into our corporate culture in the pursuit of both growth and

efficiency.

Leading global companies are those that realize both profitability and growth through creativity, innovation and entrepreneurship.

Through the exploration of new business opportunities, SF&MI aims to become a leading global insurer that boasts market

leading management efficiency.

Our Respected Shareholders!

SF&MI is now on an open sea at full sail towards our vision of becoming “one of the Global Top 10 Insurers by 2020.” I humbly ask

you, our shareholders, for your warm support and encouragement during this voyage and I earnestly wish for you and your families

health and happiness.

Thank you.

Dae-Sub Chi

President and CEO

Samsung Fire & Marine Insurance

June 4, 2010

020 021think NEXT Message from the CEO

Outside Director

Young-Chul KimKang-Jung KimWon-Chang LeeHeon-Cheol Shin

Executive VP

Hyung-Mo YoonKye-Ha LeeYong-Am Yoon

Auditing Diresctor

Jae-Sik Lee

Senior Vice President

Moon-Pyo ChaeJae-Ho NamNam-Ku YohYoung-Soo ChaJae-Hong ParkJong-Sung LeeHai-Sun HwangTae-Hwan KimYoung-Chang Ko

Vice Presidnet

Kee-Chul ShinEui-Hyeon KimYoun-Gil KimJeong-Cheol KimDae-Kyung KimHoe-Yong JungTae-Myung KwonYoung-Moo ChoiJong-Woo KimJung-Bin KoYoung-Kap Choi

Seong-Gyu KimHoon-Taek OhHag-Geun WhoangByung-Seok ChoiYang-Hee LeeSuk-Han LeeChoon-Weon ParkBeom LeeHyung-Koo KangSang-Kyung LeeHyun-Jun Jeong

You-Sang KimKi-Jae SeongByung-Ho ChunIn-Su JangDae-Young KwonMyeong-Ho LeeDeok-Jae LeeJong-Young LeeHee-Jong ChoSuk-Tae Kim

CORPORATE DIRECTORY

* Current executives as of July 31, 2010

President & CEO

Dae-Sub Chi

Samsung Fire & Marine InsuranceAnnual Report 2009

CORPORATE GOVERNANCE

SF&MI resolves important matters regarding shareholder and corporate social responsibilities through responsible management andthe transparent and independent management of the Board of Directors (BOD), our highest decision-making organization whichdecides important management policies. The BOD is composed of seven members, four of whom are independent outsidedirectors, and all of whom possess extensive experience and specialized expertise in insurance, economy, management and law.

There are four independent outside directors, accounting for 57% of the BOD. Furthermore, we have strengthened theindependence of our outside directors by preventing those specially related with SF&MI from being appointed. Furthermore, alldirectors, both internal and external, are appointed through resolutions proposed at general shareholders’ meetings. The participationratio of the BOD was 100% in 2009. The BOD deliberates and decides not only on matters determined by law and the Article ofIncorporation, but also on other important matters such as basic management polices and the execution of policies at regularquarterly meetings and extraordinary meetings when deemed necessary. Remuneration of the directors is determined by resolutionspassed at the general shareholders’ meeting in accordance with the law and the Article of Incorporation.

SF&MI has the Management Committee, the Enterprise Risk Management Committee, the Internal Trading Committee, the AuditingCommittee and the Outside Director Recommendation Committee under the BOD for the rational management of the BOD and formore specialized decisions. The Management Committee makes decisions on important management matters delegated by theBOD. The Enterprise Risk Management Committee is in charge of risk management tasks, such as efficient management,supervision of corporate risks and the establishment and evaluation of policies. The Internal Trading Committee checks and controlssignificant internal trading among subsidiaries. The Auditing Committee conducts audits for the quarterly settlement accounts andmanagement status of accounting, while the Outside Director Recommendation Committee recommends outside directorcandidates at general shareholders’ meetings.

•Sub-Committee

022 023think NEXT Corporate Governance

Sub-Committee Management Committee Two Inside Directors

Two Inside Directors

Two Inside Directors &Two Outside Directors

One Inside Directors &Two Outside Directors

Three Outside Directors

Enterprise RiskManagement Committee

Outside DirectorRecommendation Committee

Auditing Committee

Internal Trading Committee

Three Inside Directors &Four Outside Directors

Establishing a new COMPANY STANDARD VIAGLOBAL

HONEST COMMUNICATION

“We not only strive to understand and adapt ourselves to the lives of people invarious regions and countries, but also their dreams and ideas. Our global strategyhas paid off handsomely, enabling us to get ever closer to our customers.”

“SF&MI always takes care of my car more than I do myself. Therefore, I know I can

trust SF&MI. Every time I receive services from SF&MI, I feel that they are sincere.

Namely, its sincere services are the ‘truth’ about SF&MI.”

BEST MEETS BEST TO PROPOSE NEW CONCEPTION OF BRAND

SF&MI CREATES TO CREATE SYNERGY WITH CUSTOMERSPARTNERSHIP

“We trust SF&MI. We believe in SF&MI as a company and the strength which

SF&MI can give us. It motivates and energizes me because such a strong

partner is helping us.”

GOING BEYOND BUSINESS AND PRACTICING

FOR THE FUTURE OF HUMANITYSUSTAINABLE GROWTH

“SF&MI not only talks about fulfilling our corporate social responsibility, but also

hopes of creating a bright future of our children because this is what SF&MI’s

employees and our customers ultimately want.”

REVIEW OFOPERATION

34AUTOMOBILE INSURANCE

36LONG-TERM INSURANCE

38COMMERCIAL INSURANCE

40ENTERPRISE RISK MANAGEMENT

A+: SUPERIOR

Obtaining an A+ (Superior) grade infinancial soundness evaluation byA.M. Best for eight years in a row

35AUTOMOBILE INSURANCE

37LONG-TERM INSURANCE

39COMMERCIAL INSURANCE

41ENTERPRISE RISK MANAGEMENT

A+: STABLE

Receiving an A+ (Stable) grade incredit ratings by S&P for sevenconsecutive years

1stEstablished a corporation in China, a first for a foreign insurance company

SF&MI ALWAYS DEVELOPS DIFFERENTIATED PRODUCTS

SATISFIES CUSTOMERS WITH THE FINEST SERVICES

TAKES THE INITIATIVE IN THE MARKET WITH STRONG CONFIDENCE AND

COMPETITIVENESS, AND MAINTAINS ITS MARKET LEADERSHIP

VIA CONTINUED GROWTH.

SF&MI’S THOUGHTS ARE ALWAYS “NEW”

THIS IS THE INNOVATION OF A PIONEER

Direct Premiums (In billions of Korean Won)

2007-

3,112.3

2008-

3,060.5

2009-

3,148.2

Samsung Fire & Marine InsuranceAnnual Report 2009

“ANYCAR”, OUR AUTO INSURANCE BRAND, HAS RANKED FIRST FOR 12CONSECUTIVE YEARS IN THE KOREAN CUSTOMER SATISFACTION INDEX (KCSI), AFIRST FOR A FINANCIAL COMPANY.

AUTOMOBILEINSURANCE

• Myung- Joon Kim

The Environment of the Auto Insurance Market in 2009and SF&MI’s Strategies and Performance

Despite the ever-changing auto insurance market environment,SF&MI has maintained a strong market leadership; achieving28.1% market share in fiscal year 2009. Furthermore, enjoying astrong and steady performance in our online automobileinsurance since a foray into the market in March 2009, we expectto maintain our undisputed market share in this sector in thefuture.

SF&MI adopted various rate-diversification and profitability-oriented price policies in 2009. As a consequence, we havedisplayed a fine business structure in terms of profit and loss byposting a loss ratio of 71.7%, well below the industry average of75.4%, in 2009.

Ensuring Appropriate Pricing Prices

Intending to offer customers excellent products and services,SF&MI adheres to price policies that cover insurance costswhile avoiding excessive price competition in the growing on-line market. Furthermore, we continue to strengthen andimplement price strategies for fairness among policyholders, aswell as advanced positive underwriting systems, by levyingreasonable insurance premiums in line with risks.

Reinforcing Competitiveness by Providing DifferentiatedProducts

SF&MI provides various differentiated products to strengthenthe competitiveness of its sales organization and offer the mostoptimized, tailor-made products. In October of 2009, SF&MIlaunched “anycar Lady Auto Insurance” which expandscoverage for female customers.

This policy enjoyed a good response in the market since it offersactual items that promote a customers’ quick recovery and safedriving, as well as a new service which involves accompanyingpolicyholders to police stations.

Our efforts paid off handsomely. Korea Management AssociationConsulting Co. has selected “anycar,” the auto insurance brandof SF&MI, as the top-ranked brand in the KCSI for 12 straightyears.

Strengthening Traffic Accident Prevention Activities

With the goal of fulfilling its corporate social responsibilitiesthrough efforts to decrease the number of car accidents, theSamsung Traffic Safety Research Institute (established in Julyof 2001) conducted publicity activities 153 times via massmedia, such as broadcasting, in 2009.

In particular, we have steadily produced and aired informativeeducational programs regarding exemplary traffic safety casesin advanced countries in partnership with leading broadcastingcompanies since 2006.

Since 2003, SF&MI has trained the mothers of elementary schoolstudents as honorary teachers of traffic safety (an average of15,000 honorary teachers every year). As of December 2009,this program is in its eighth year. These honorary teachers takecare of students when they go to and leave school. In addition,since 2008 we have held traffic safety seminars for publicservants in charge of traffic at 234 local autonomy units everyyear to support their traffic safety policies.

An Outlook on the 2010 Market Environment andSF&MI’s Strategies and Plans

We provide continuous support to the sales channels of ourface-to-face organization, while our online channel continues toexpand. Thus, our market position is expected to be furtherreinforced. We will maintain a profitability-oriented price policythat gets reflected in our loss ratios and expenses.

By refraining from excessive price competition, offeringexcellent products and services, and maintaining price policiesto secure original insurance costs, we expect to realize a stableincome. In the future, we will continue to offer products thatcater to customers’ needs, and strive to differentiate services sothat anycar auto insurance will be able to receive goodresponses from both sales organizations and customers.

The Samsung Traffic Safety Research Institute encouragespeople to have a strong awareness of traffic safety and thegovernment to invest in traffic infrastructure by further streng-thening reports on overseas traffic safety through broadcastson major television networks. Similar reports by the institutewere aired last year.

We will endeavor to make auto insurance profitable andestablish our position as a leading company in the market.

034 035Review of Operation Automobile Insurance

Direct Premiums (In billions of Korean Won)

2007-

5,089.6

2008-

5,576.8

2009-

6,580.8

Samsung Fire & Marine InsuranceAnnual Report 2009

WE WILL ESTABLISH AND STRENGTHEN A DIFFERENTIATED POSITION ANDMAINTAIN OUR MARKET LEADERSHIP IN THE LONG-TERM INSURANCE SECTOR.

LONG-TERMINSURANCE

• Min- Sun Kim

Business Environment of the Long-Term InsuranceMarket and SF&MI’s Strategy

Due to the aftereffects of the global financial crisis, it is possiblethat the financial market may suffer a long-term slump.Furthermore, barriers among the business scopes of financialinstitutions will be broken down as other financial institutions makeinroads into the insurance market. As a result, competition isexpected to get far fiercer.

In addition, inside the insurance industry, the differentiation betweenlife and non-life insurance companies is being weakened, such asthe standardization of actual medical expenses. Meanwhile, themanagement environment of the insurance market is facingsignificant change, such as the diversification of sales channelsdue to the expansion of independent channels, including theinternet and home shopping channels.

Maintaining Market Leadership through Steady GrowthBased on Profitability

Amid such a market environment, we realized steady growth in thelong-term insurance sector with systematic and strategic productdevelopment and underwriting policies. At the same time, we havesecured profitability through the sophistication of our managementof risk, profit and loss. Furthermore, we are actively adaptingourselves to the fast-changing financial market environmentthrough research into new growth engines in long-terminsurance on the basis of customer value, the development ofstrategic products through new strategic market developmentand the strengthening of the supply of optimal products foreach channel in order to promote balanced growth amongchannels.

Elevating the Core Competitiveness of Long-TermProducts

Our long-term insurance plays a core role for us in terms of notonly sales but also future profitability. Therefore, we are solidifyinga differentiated position, such as reinforcement of the corecapabil i t ies of product development, underwrit ing andcompliance systems in the long-term insurance sector as wellas optimizing our product portfolio.

We endeavor to enhance customer and shareholder value bybuilding a scientifics and systematic statistics system, includinga proper risk ratio and a renewal system to build a stable profitgenerating base.

Intensifying Strategies to Tackle Diversification in SalesChannels

SF&MI focuses on offering optimized products for eachchannel and differentiating sales strategies following the recentexpansion of independent channels, such as the internet andhome shopping.

We strive to provide products differentiated for each customerand channel through the analysis of the competitiveness ofsales channels and by monitoring products in terms of marketcompetition.

An Outlook on Next Year’s Market Environment andSF&MI’s Strategies and Plans

It is forecast that weakened consumer confidence in insurancewill continue this year on account of the global financial crisis,while a price dumping war of low-priced products is expectedto continue following the expansion of independent channelssuch as the introduction of companies specializing in the saleof financial products and the growth of internet channels.

Furthermore, the management environment around theinsurance market is facing significant change, with theliberalization of insurance premium calculation, the introductionof cash flow pricing and the stronger protection of consumersall expected in the near future. As a result, SF&MI plans toexpedite a management strategy for our long-term insurance inorder to ensure a steady rise in our market share.

By obtaining a clear understanding of customers’ needs, wewill develop and supply products from their viewpoint. We willsteadily maintain our market leadership by providing productsthat cater to changes in customer and market needs aftersuggesting products and marketing measures by customerneeds and purchasing behavior models.

Furthermore, we will continue our efforts to enhance customervalue and create new markets, products and services so as totake the lead in the market with creative ideas. In addition, wewill manage risk ratios through more elaborate and systematicanalyses for the stable management of profit and loss, as wellas strive to strengthen original price competitiveness in order tosecure a competitive edge with the introduction of a cash flowpricing system.

036 037Review of Operation Long-Term Insurance

Direct Premiums (In billions of Korean Won)

2007-

958.7

2008-

1,107.6

2009-

1,166.1

Samsung Fire & Marine InsuranceAnnual Report 2009

SF&MI SECURES A COMPETITIVE ADVANTAGE WITH A CONSULTING-TYPE SALES SYSTEM AND SCIENTIFIC RISK ANALYSIS IN THE COMMERCIAL INSURANCE SECTOR.

COMMERCIALINSURANCE

• Ho-Joong Ryu

The Commercial Insurance Market Environment in 2009and SF&MI’s Strategies and Performance

In fiscal year 2009, the commercial insurance business ofSF&MI posted KRW1.166.1 billion in direct premiums written,up 5.3% from the previous year, despite the global financialturmoil and worsening real economy. In addition, operatingprofit rose by KRW51.6 billion to KRW203.5 billion, despite asteady drop in the reinsurance market and an increase inforeign exchange O/S due to a sharp rise in the foreignexchange rate.

These impressive results were possible because SF&MIdifferentiated sales by building and distributing BP cases ofconsulting-type sales systems. Furthermore, we were able toenjoy these results by establishing scientific retention andunderwriting decision processes after strengthening ourunderwriting competitiveness, such as the development of riskanalysis tools and price calculation models.

We also launched new products such as AnyHome® andAnyBiz® targeting our potential markets and improved salessupport to reinforce sales, all of which contributed to ourimpressive results.

Furthermore, to explore new growth engines, we are continuingto create new markets via the expansion of catastropheinsurance in the domestic market. In the overseas businesssector, we have been strengthening our capabilities as aleading global financial institution by moving forward with newbusiness. That is to say, we have laid the foundation for thesteady growth of our overseas business through the expansionof bases (the establishment of an office in India in April, 2009and an office in Brazil in September, 2009) and commencementof auto insurance business in China.

2010 Outlook, Strategies and Plan

It is expected that demand for commercial insurance will rise in2010 backed by a recovery in domestic sales and a rise inexports. However, SF&MI will face numerous difficulties inreaching its business goal due to the effects from a drop insales denominated in foreign currency caused by a decreasein the foreign exchange rate. In order to overcome thissituation, we wil l continue to develop new markets byintroducing insurance for corporate executives and employees,enhancing sales competitiveness, promoting steady growth inoverseas markets and securing core capabilities.

SF&MI will focus on markets where insurers are connectedwith company employees and customers of large corporationsby introducing new sales systems, such as the B2B2C system(insurance firms↔ companies↔ employees or customers oflarge corporations) while veering away from the existing B2Bsystem (insurance firms↔ companies), In addition, we willreinforce a consulting-type sales system via the advancementof the Samsung Loss Control Center to differentiate salescompetitiveness from that of our competitors.

Meanwhile, we will secure flexibility in the management of ouroverseas business bases via the establishment of a corporationin Europe and the independent management of a corporation inthe U.S. We also plan to establish a bridgehead to become anadvanced global player by stepping up new overseasbusinesses, such as establishment and expansion of an autoinsurance business in China as well as establishing areinsurance company in Singapore.

Lastly, we will activate sales and increase profits by enhancingour specialty in underwriting via better planning functions andthe reinforcement of core capabilities on the foundation ofsystematically fostered professionals. In addition, we will focuson elevating our system competitiveness by building a data-based work system and an integrated customer informationsystem.

038 039Review of Operation Commercial Insurance

Underwriting Efficiency (%)Expense Ratio

2008-

23.0% 99.6% 101.7%

2009-

22.7%

2009-

79.0%

2008-

76.6%

Samsung Fire & Marine InsuranceAnnual Report 2009

DEDICATED TO IDENTIFYING, ASSESSING AND MANAGING POTENTIAL THREATSOUR ENTERPRISE RISK MANAGEMENT COMMITTEE IS RESPONSIBLE FOR ADDRESSING RISK AND CONTROLLING RISK-RELATED ISSUES IN A TIMELY ANDAPPROPRIATE MANNER.

ENTERPRISE RISKMANAGEMENT

Loss Ratio

• Hae-Rim Lee

As a financial institution, active risk management is one of themost crucial and core competencies of SF&MI. Managing riskis not just about avoiding or even minimizing it. Risk also needsto be considered as a potential opportunity. The ERMdepartment manages the overall risk profile, aiming for a goodbalance between risk and return.

SF&MI uses the Enterprise Risk Management (ERM) system. Ithas two functions: to ensure financial stability through controlledrisk-taking and to provide for adequate capitalization through abroad range of risk analyses.

SF&MI’s Enterprise Risk Management Principles

At SF&MI, Enterprise Risk Management (ERM) is based onthree principles that are applied throughout the company.

Early Warning Risk Identification:Risk management and analyses involving projections for the future and requiringrisk management forecasts and prognostications. Key Risk Indicators (KRIs) allowSF&MI’s risk managers to evaluate risk in advance using real data.

Independent Risk Management Function:A specialized SF&MI department that is in charge of managing conflicts ofinterest.

Value-based Management Support:Embedded Value (EV) appraisal and the reporting of same enable SF&MI topractice Value-based Management (VBM) and measure the economic value ofSF&MI's overall insurance operations.

Enterprise Risk Management Organization and Structure

The Board of Directors is responsible for establishing theframework, principles, and guidelines for Enterprise RiskManagement (ERM) at SF&MI. The Enterprise Risk ManagementCommittee is responsible for addressing risk and controllingrisk-related issues in a timely and appropriate manner.

SF&MI’s Enterprise Risk Management Department monitorsrisk through analyses, reports and risk modeling, and is taskedwith identifying a wide range of possible risk scenarios in thecompany’s business units. By applying these processes, thedepartment assesses each risk scenario, monitors it, andimplements appropriate action plans.

Risk Categories

The major risks that SF&MI faces are as follows.Asset-Liability Management (ALM) Risk:ALM manages structural risks (i.e. interest rate equity, and liquidity) from theperspective of optimized returns. Managing for ALM Risk involves strategizingfrom the dual viewpoints of assets and liabilities. Strategic Asset Allocation (SAA)involves the optimization of asset structures, while Product Mix Strategy isconcerned with the optimization of liability structures.

Insurance Risk (Underwriting Risk):Insurance Risk refers to the danger of incurring a financial loss due to property,casualty, auto, or long-term insurance events. Our Enterprise Risk ManagementDepartment manages the transfer of such risks-including setting limits onunderwriting authorizations and requiring approval for transactions involving newproducts. It also oversees the management of reinsurance and monitorsemerging issues that may affect the company’s overall exposure to risk.

Market Risk:Market Risk refers to the danger of being negatively impacted by movements infinancial markets, including equity market prices, credit spreads, foreignexchange rates, and real estate prices. Through scenario & sensitivity analysis,SF&MI measures potential changes in expected earnings based on aninstantaneous increase/decrease in financial market factors.

Credit Risk:Credit Risk refers to the danger of incurring a financial loss due to the diminishedcredit-worthiness of counter-parties of SF&MI and/or third parties. To helpmitigate the possibility of such occurrences, SF&MI transfers a portion of its newbusiness to authorized reinsurers that are rated at least “A-.” For its investmentportfolios, SF&MI maintains a well-diversified credit fixed-income portfolio acrosscompanies and industries.

Regulatory Perspective

SF&MI is engaged in the Risk Assessment & ApplicationSystem (RAAS) and preparing for the introduction of the Risk-Based Capital (RBC) System, both of which are statutoryrequirements of the Korean Financial Supervisory Service.

Strategic Risk Management Decision Making

SFMI’s strategic decision is made by quantitative/qualitativeanalysis. The Enterprise Risk Management Department isinvolved with the company’s future earnings projection, NPV,IRR and Capital collection periods using quantitative analysis. Inaddition, SWOT analysis and reputation/compliance riskassessment are also used in the company’s strategic decisionmaking.

Strategic decisions are made during a management committeemeeting or by the Board of Directors. Risk managementanalysis is one of the major tools used for strategic decisions,not only in regards to any financial impact but also forreputation/compliance risk reviews.

Strategic acquisition, if necessary, will be made throughvaluation by actuarial and risk management concept inaccordance with regional regulation

040 041Review of Operation Enterprise Risk Management

SUSTAINABILITYMANAGEMENT

44ETHICAL MANAGEMENT

46ENVIRONMENT MANAGEMENT

48CORPORATE SOCIAL RESPONSIBILITY

50SPORTS

52CULTURE

12years

No.1 in the KCSI for 12consecutive years

8yearsNo. 1 in the KS-SQI for eightconsecutive years

9yearsNo.1 in the non-life insurance of the NCSI for nine consecutive years

THROUGH OUR “3C” MOVEMENT, REPRESENTING CLEAN, CHANGE AND

CHALLENGE, SF&MI ACTIVELY TAKES THE LEAD IN

CREATING A BETTER PLACE TO LIVE.

AS HIGHLIGHTED BY OUR ACTIVITIES FOR CHILDREN’S SAFETY

AND SPORTS FOR A DYNAMIC SOCIETY,

“WE” IS ALWAYS AT THE CENTER OF SF&MI’S AIMS.

THESE ARE EXAMPLES OF “INNOVATION” BY A PIONEER IN THE INDUSTRY.

FROM THE CEO TO ENTRY LEVEL STAFF, ALL EMPLOYEES OF SF&MI CLEARLY UNDERSTAND THAT ETHICAL MANAGEMENT IS NOT A CHOICE BUT AN OBLIGATION, AND HAVE A STRONG DETERMINATION TO PUT IT INTO PRACTICE.

ETHICALMANAGEMENT

Samsung Fire & Marine InsuranceAnnual Report 2009

SF&MI designated 2002 as the threshold year for ethicalmanagement and announced “3Cs” (Clean, Change, Challenge)as the basic direction for its management during a ceremony toproclaim ethical management. Accordingly, SF&MI adopted itscode of ethics, with the major objectives being “transparentmanagement trusted by people”, “fair trade in regards to fairand free market competition” and “an honest organizationalculture that fights corruption”.

Employees’ Commitment to Ethics and Compliance withLaws

SF&MI has established a new concept of complete sales, andstr ives for customer sat isfact ion through accuratecompensation based on a strong belief and confidence in thevalue of insurance. In 2009, we announced the codes ofconduct, with five key parts; customer orientation, a sense ofownership, a spir i t of chal lenge, professional ism andcompliance with laws. All employees reaffirmed their resolutionto practice ethical management through internal broadcastingand the distribution of publicity materials. Furthermore, allemployees are required to sign a written oath promising touphold the value of ethical management, thus creating anethical management culture throughout the company.

All SF&MI executives and employees are well aware of the factthat ethical management is not a matter of choice but anobligation. President Chi always emphasizes the significance ofethical management. “We should take pride in people’sexpectations of our ethical responsibilities and change amental burden into a sense of responsibility so as to live up tothe expectations of our customers and society in general” Chireaffirmed via a morning address in April of 2010.

Fair Trade Compliance

Since holding a ceremony for fair trade compliance in 2001, afirst for a non-life insurer in Korea, SF&MI has launched andoperated a compliance program to establish a fair tradecompliance culture. In 2005, we inaugurated the InternalTrading Commission, composed solely of outside directors,and stepped up our transparent management practices. In2009, SF&MI opened the Fair Trade Compliance CounselingCenter, allowing employees to receive guidance on fair trade.

Furthermore, SF&MI operates a Whistle Blowing Program, aninternal reporting program through which employees can reportnon-compliance within the company anonymously. Thisprogram is aimed more at preventing corrupt cases thandiscovering them. We also run an ethical managementeducation course for employees throughout the year in order toshare lessons learned from whistle blowing cases as well asprovide them with examples of the best and worst practices forethical management.

044 045Sustainability Management Ethical Management

ENVIRONMENTMANAGEMENTSF&MI IS CLEARLY AWARE THAT COMPANIES WHICH CAN REALIZE SUSTAINABLE GROWTH IN THE FUTURE MUST STRIVETO IMPROVE AND PROTECT THE ENVIRONMENT ANDTHEREFORE, ACTIVELY PUTS THIS INTO PRACTICE.

Samsung Fire & Marine InsuranceAnnual Report 2009

Samsung Fire & Marine Insurance’s Response toClimate Change

SF&MI actively fights against climate change by launching eco-friendly products and services (such as bicycle insurance,electronic insurance policy, flood insurance, and liabilityinsurance for solar power plants), reducing energy use in ourbuildings, and supporting environment friendly initiatives, suchas UNEP FI.

Electronic Insurance Policy

In order to become more environmentally friendly and reducepaper use, SF&MI ini t iated an Electronic InsurancePolicy(2009.11). If a customer agrees to receive contractmaterials (Insurance Policy, Policy agreement terms and notice,termination, etc.) by E-mail rather than paper, SF&MI eitherdonates a certain portion of the premiums to environmentalorganizations(NGOs) or uses it for environment friendlybusinesses in conjunction with the Korea Forest Service andHealthy Forest, etc.

Energy Conservation Activities

In order to conserve energy and reduce CO2 emissions,SF&MI participates in the following activities : Turning off ourlights during lunch hours, lowering the power of our airconditioners & heaters, participating in an energy conservationcampaign(Earth Hour), and providing company buses todecrease employee vehicle use during commute hours.

Public Communication Activities

In order to show our commitment towards addressing climatechange, SF&MI became a United Nations Environment Pro-gramme Finance Initiative (UNEP FI) member and CarbonDisclosure Project (CDP) signatory in January of 2010.

In addition, we successfully built our Greenhouse Gas Inventorythat covers 29 of our buildings. We plan to disclose this emissiondata from 2010.

046 047Sustainability Management Environment Management

CORPORATESOCIALRESPONSIBILITYTHROUGH VARIOUS SOCIAL CONTRIBUTION ACTIVITIES FOR CHILDREN ANDDISABLED PEOPLE SF&MI DELIVERS SAFETY AND HOPE TO THOSE WHONEED CARE AND SUPPORT THE MOST.SINCE INAUGURATING A VOLUNTEER GROUP IN 1994, SF&MI HAS BEENENGAGED IN VARIOUS SOCIAL CONTRIBUTION ACTIVITIES.

Samsung Fire & Marine InsuranceAnnual Report 2009

Traffic Culture Improvement Projects

We selected traffic culture projects as our representative socialcontribution project, and have exerted ourselves to preventchildren from becoming involved in traffic accidents byinforming the public of traffic safety guidelines. These haveincluded various traffic safety education programs and trafficrelated campaigns at the Samsung Traffic Safety ResearchInstitute (STSRI) and Samsung Transportation Museum.

In addition, SF&MI provides assistance to 94 children of trafficaccident victims and traffic police officers. Among the variousassistance activities are covering living costs, providing collegeentrance scholarships and private tutoring fees and donatinggraduation gifts. We also provide emotional support byconnecting each child with a particular division of the company.

Social Contribution Activities for Disabled People

SF&MI conducts an array of social contribution activities forpeople with disabilities. We help visually challenged people andthose in wheelchairs better adapt to society through the help ofvolunteers from the Helping Telephone of Korea organization.

We also hold a musical talent camp for teenagers withdisabilities and award prizes to excellent classes with disabledstudents in partnership with a volunteer group, “First andForemost Movement for Persons with Disabilities.”

In particular, in 2008 and 2009, we signed the Social Agreementto Raise Public Awareness of Disability with the Ministry ofEducation, Science and Technology and the First and ForemostMovement for Persons with Disabilities, as well as producedand distributed a campaign film “My Friends” to 3,000 middleschools across the country.

In addition, SF&MI has also donated a total of 134 speciallytrained guide dogs to blind people since 1995. These guidedogs are donated twice a year after being trained at theSamsung Guide Dog School.

Furthermore, we are making diversified efforts to encouragepeople to have more positive attitudes towards guide dogs inpublic facilities and mass transit systems through steadycampaigns.

KRW500 Gift of Hope

SF&MI risk consultants (RC) have raised the “KRW500 Gift ofHope” fund by donating KRW500 for every long-term insurancecontract signed since May of 2005. The fund is used torefurbish kitchens, restrooms, washstands and study rooms,etc. at the homes and facilities of disabled people in order toimprove their living conditions.

So far, approximately 21,000 RCs have joined the campaign,raising KRW1.96 billion and bringing new hope to 88 familiesof disabled people and 16 facilities for disabled people.

Samsung anycar Volunteer Group

Aiming to better serve communities as a good corporatecitizen, SF&MI launched the Samsung anycar Volunteer Group,in which 180 sub-groups are actively engaged in communityservices across the nation. In 2009 alone, each employeeparticipated in volunteering an average of 4.3 times or 13.5hours. Our employees also raised approximately KRW400million a year through the Dream Fund. The company thenmatches these donations, which are then used to lend ahelping hand to neighbors in need. Since August 2005, ourbusiness divisions have established partnerships with 105 ruralcommunities. Employees are encouraged to visit and purchaseagricultural products from the village partnered with theirdivision.

Going forward, SF&MI will practice “management of sharing”through various social contribution activities.

048 049Sustainability Management Corporate Social Responsibility

THE PASSION OF SF&MI STANDS OUT IN SPORTS. WE PROGRESS AND INNOVATE FURTHER EVERY YEAR.

SPORTS

Samsung Fire & Marine InsuranceAnnual Report 2009

Samsung Fire & Marine Insurance Bluefangs VolleyballClub

Since its launch in 1995, this volleyball club has made asensational debut by winning the title of the 2nd Korea GrandVolleyball League in 1996. The next year, the Korea VolleyballSuper League was created and the Samsung Fire & MarineInsurance Bluefangs won the title. The volleyball team hassince swept the top spots in a number of series in Korea.

The triumphant march of the Bluefangs reflects the passion ofSF&MI. In 2008, the club won the grand title of the nation’svolleyball leagues. The Bluefangs volleyball club is in full gear towin the 2009-2010 volleyball leagues with its new pioneerspirit. The team will bring fans lots of joy and excitementthrough well-mannered and thrilling games in the next season.

The 14th Samsung Cup World Baduk Masters1

The Samsung Cup World Baduk Masters , which marks its14th year in 2009, has upgraded the rules and prizes underthe slogan of “Change and Innovation - the Samsung CupEvolves.” “The Samsung Cup World Baduk Masters” refers to atraditional Korean board game also known as “Go”.

In the previous competitions, players from Korea, China andJapan constituted the majority of the participants. This year,however, players from Southeast Asia, Europe, and Americaare also invited. Therefore, the international reputation of theSamsung Cup is expected to be strengthened significantly.

As a result, for the first time in the competition’s history, the topplayers from 10 countries including Singapore, Thailand,

Canada, France, Germany, the Netherlands, Hungary,Romania, Russia, and the Czech Republic will come to Koreato compete for the title.

Besides participating in the world’s largest “The Samsung CupWorld Baduk Masters” championship, the players couldchoose to participate in goodwill matches with Korean Badukclubs. The events are designed to offer opportunities for theplayers to experience the excellence of Korean Baduk and toraise awareness of it in countries of the players.

In the previous competitions, each country had the right torecommend their seed players. This year, however, only thewinners of major championships are invited so as to ensurethat the world’s top players join the games.

The rules of finals have also changed significantly. Instead of aknockout tournament where defeated players in each matchare eliminated, double elimination2 will be applied for the top 32players. The format, which was used in the World BaseballClassic (WBC), aims to give another chance to losers, reduceunexpectedness, and add more thrills to each match.

In addition, a “Senior’s Group” was created for pros over 45years old. Online preliminaries are also adopted so thatamateur players can participate in the Samsung Cup moreeasily.

A Children’s Baduk competition will also be held on thesidel ines of the Samsung Cup. Young Baduk playersadvancing to finals will have their matches in the place wherethe quarter-finals of the Samsung Cup are held and will beallowed to watch the games in person.

1) Masters competition:Competitions to which the winners and top players in major championships are invited.

2) Double elimination:A type of tournament where a player is eliminated upon losing two games. However,if the player loses one game and wins the other two, s/he will be eligible to advance to the next round.

050 051Sustainability Management Sports

THE SAMSUNG TRAFFIC SAFETY RESEARCH INSTITUTE,THE SAMSUNG LOSS CONTROL CENTER AND THE SAMSUNGTRANSPORTATION MUSEUM OF SF&MI ACTS AS SOCIAL EDUCATIONALORGANIZATIONS BY COLLECTING, RESEARCHING AND PRESERVINGCULTURAL HERITAGES

CULTURE

Samsung Fire & Marine InsuranceAnnual Report 2009

Samsung Traffic Safety Research Institute (STSRI)

The Samsung Traffic Safety Research Institute (STSRI) wasestablished in July 2001 to technically support claim adjustmentprocess and promote public traffic safety via researches andactivities in various disciplines. The institute is a part of theclaim adjustment department at SF&MI with three divisions and18 automobile technology, transportation science, or socialscience experts.

Vehicle Technology Division deals with damageabil i ty,repairability, and collision safety, while Accident ResearchDivision performs researches on causality, analysis, and trendsof traffic accidents. Traffic Policy Division focuses not only ontraffic safety policy support and development, but also ontraffic safety education, promotion, and publicity. STSRI’sresearch output is mainly used to educate and train claimadjusters and repair experts of SF&MI, and auto insuranceholders. It also helps to develop and support policy or decisionof the SF&MI and the government, often utilized as informativematerials for traffic safety promotion.

The STSRI has actively cooperated with Ministry of Land,Transport, and Maritime Affairs (MLTM) of Korea, KoreaAutomobile Insurance Repair Research and Training Center(KART) of Korea Insurance Development Institute (KIDI), KoreaAutomobile Testing & Research Institute (KATRI) of KoreaTransport Safety Authority (KTSA), the Korea Transport Institute(KOTI), and many other governmental and non-governmentalagencies to enhance research performance, supportingnational traffic safety. Several major research areas includewhiplash research, repair research, vehicle crash research,vehicle safety research, road hazard research, and road safetyaudit.

Samsung Loss Control Center

SF&MI formed a specialized organization for risk managementin 1979, the first among domestic non-life insurers. Since then,it has provided risk-management services for accident

prevention to create disaster-free workplaces for customers.The specialists at our Loss Control Center have rich practicaland theoretical experience in numerous fields, includingconstruction, civil engineering, machinery, electronics, andchemical engineering. They have exerted their best efforts tosafeguard our customers from accidents by developing newrisk-prevention skills for highly industrialized fields, establishingpractical accident-prevention methods, holding seminars andpublishing reports.

Samsung Transportation Museum

The Samsung Transportation Museum, the only automobilemuseum in Korea, aims to introduce the history and spirit ofautomobiles, and thus promote automobile culture that can bewidely shared by the public. Since the museum’s establishmentin May, 1998, approximately 300,000 people have visited everyyear.

The transportation museum is playing three roles as below:

•Social education on automobile cultureThe museum has collected, studied and preserved a wide variety of

artifacts related to automobiles. It also has exhibited its collections, ran

training programs and published books to fulfill the public desire to

know more about automobile culture.

•Preserving and promoting the heritage of automobileculture

The museum has preserved automobile-related artifacts in an

optimized environment and restored damaged ones, passing this

heritage down to our descendants.

•Creating and promoting a new automobile cultureThe museum has introduced and explored automobile culture in all its

forms and related information in an effort to provide the public with

opportunities to experience it, as well as creating and promoting a new

and better automobile culture in Korea.

052 053Sustainability Management Culture

FINANCIALSECTION

56MD&A

65FINANCIAL STATEMENTS

120WORLDWIDE NETWORK &SAMSUNG AFFILIATES

10trillion wonPremium revenue exceeded KRW10 trillion, the first for a non-lifeinsurer in Korea

426.4%Solvency margin ratio: 426.4%, the highest in Korea

No. 1Market share: 28% (ranking first in the Korean non-lifeinsurance industry)

A COMPANY THAT CREATES NEW ACHIEVEMENTS EVERY YEAR

A COMPANY THAT PRESENTS FULL SATISFACTION TO

CUSTOMERS AND INVESTORS

A COMPANY ENTRUSTED BY PEOPLE

A COMPANY THAT GROWS FOR A BETTER WORLD

SF&MI DOES NOT LOSE ITS BALANCE FOR SUSTAINABLE GROWTH

THIS IS THE TRUE “INNOVATION” OF A PIONEER

MANAGEMENT DISCUSSION & ANALYSIS

A. Operational Results

1. Overview

In fiscal year 2009, with the world economy experiencing a financial market upset amid major economies’ cooperation and expansion of

budget spending against the global financial crisis, the Korean economy saw its real economy grow gradually despite a weakened job

market. Within the non-life insurance industry, competition between life and non-life insurance companies grew due to the product

standardization of medical expense insurance. Meanwhile, the non-life insurance industry experienced a year more competitive than ever

before on account of a sharp rise in sales via the independent channels of middle-and low-ranked non-life insurers.

In spite of such a difficult business environment, SF&MI surpassed KRW10 trillion in direct premiums written and KRW1 trillion won in

investment profits, a first for a non-life insurer in Korea, while posting KRW524.5 billion in net profit through stable asset management and

enhancement of managerial efficiency. Furthermore, our total assets rose by KRW3,563.7 billion to KRW26,655.9 billion, while our

catastrophe reserves increased by KRW73.5 billion, making SF&MI a financially stronger company. In addition, SF&MI produced the

following excellent results thanks to its shareholders’ and customers’ unwavering support for and belief in the company.

First, SF&MI enhanced sales competitiveness around profitability. SF&MI’s market share steadily dropped due to the expansion of new

channels, such as the GA channel as well as excessive competition among protection type product, although new premium sales steadily

grew. However, our market share recovered in the second half because we steadily elevated the quantity and quality of sales around the tied

agency channel. We expect to grow steadily and improve profitability by differentiating marketing capabilities and product competitiveness in

the future.

Second, the gap between our loss ratio and those of our competitors is steadily widening. Although in fiscal 2009 the loss ratios of auto and

long-term insurance rose overall in the industry, this gap continued to grow. This was made possible thanks to the efficiency of a systemized

processes from product design, sales, underwriting and claim adjustment. This systemized process is expected to serve as a turning point

for the company by allowing it to differentiate the business performances of SF&MI at a time when the company is growing and expand

profits.

Third, we laid the foundation for future growth by strengthening our channels. SF&MI has strengthened the sales of highly profitable

protection type product around the tied agency channel, while strategically expanding new channels in order to secure customers, the basis

for future growth. The company has steadily expanded its size around excellent human resources in order to strengthen its faceto-face

channel and increased the portion of high-performing sales organization in order to raise productivity.

Samsung Fire & Marine InsuranceAnnual Report 2009

056 057Financial Section Management Discussion & Analysis

Meanwhile, SF&MI launched auto insurance sales through an Internet channel and is enjoying strong sales performances through the

elevation of market shares around a new generation and new customers in big cities. In particular, the Internet channel of SF&MI is different

from those of other non-life insurers as all sales processes are conducted on the Internet while the Internet channels of other companies are

TM-oriented sales. As a result, our Internet channel is expected to improve the operating efficiency by reducing business costs.

2. Profit and Loss Summary

In fiscal year 2009, direct premiums written and net premiums earned posted 11.8 % and 10.3% year-on-year growth, respectively, growing

to KRW10,895.1 billion and KRW9,917.0 billion, respectively. In addition, net increase in catastrophe reserves jumped 1.2% to KRW 73.5

billion from a year before. A rise in the accident ratio in winter led to a jump in the loss ratio of the auto insurance, resulting in KRW284.9

billion in underwriting losses, a year-on-year increase of KRW253.1 billion. However, investment profit increased by KRW122.1 billion to

KRW1,009.7 billion.

As a result, operating profit dropped by 15.3% or KRW131.1billion to KRW724.8 billion. Meanwhile, non-operating losses stood at KRW36.6

billion, a drop of KRW1.5 billion. As a consequence, pre-tax net profit fell by KRW132.6billion to KRW688.2 billion from the previous year.

Net profit slid by KRW74.2 billion or 12.4% to stand at KRW524.5 billion from a year before, while adjusted net profit, including an increase

in catastrophe reserves, fell by KRW73.3 billion to KRW598.0billion. Adjusted EPS based on adjusted net profit dropped 11.0% to

KRW13,707.

Income Statement Summary Korean Won / in billions

WonFY09Change

%FY08

Direct Premiums Written 10,895.1 9,744.9 1,150.2 11.8

Net premiums Earned 9,917.0 8,992.6 924.4 10.3

Increase in Catastrophe Reserves 73.5 72.6 0.9 1.2

Underwriting Profit -284.9 -31.8 -253.1 N/A

Investment Profit 1,009.7 887.6 122.1 13.8

Operating Profit 724.8 855.9 -131.1 -15.3

Non-Operating Profit -36.6 -35.1 -1.5 N/A

Pre-tax Profit 688.2 820.8 -132.6 -16.2

Net Profit 524.5 598.7 -74.2 -12.4

Adjusted Net Profit 598.0 671.3 -73.3 -10.9

Adjusted EPS (In KRW) 13,707 15,408 -1,701 -11.0

Net Profit by Year Korean Won / in billions

FY08FY06FY05 FY09FY07

Net profit 262.0 341.2 476.5 598.7 524.5

Change -5.8% 30.2% 39.7% 25.6% -12.4

Adjusted net profit 325.3 379.5 527.8 671.3 598.0

Change 0.3% 16.7% 39.1% 27.2% -10.9

MANAGEMENT DISCUSSION & ANALYSIS

3. Earnings by Business Line

In regards to sales growth and growth rates of each business lines in fiscal year 2009, long-term insurance grew 18% from a year earlier,

while initial premium sales recorded a strong growth rate of 55.6% and renewal premiums continued to see a steady increase. The loss ratio

of long-term insurance jumped 0.9%p due to an increase in claims and savings reserves caused by the expansion of saving type product.

The loss ratio of general insurance improved 2.3% thanks to sales around relatively profitable products such as construction insurance and

property insurance policies amid a decrease in sales due to an economic slump at the beginning of the year.

Last, auto insurance showed a gradual increase in sales on account of a rise in demand for new cars following the economic recovery in the

second half of the year and the strong sales of new and renewed contracts. The loss ratio rose to 71.7% due to an increase in car traffic and

a rise in the accident ratio on account of heavy snow during the winter.

Direct Premiums Written by Line

General 1,166.1 10.7 1,107.6 11.4 58.5 5.3

Long-term 6,580.8 60.4 5,576.8 57.2 1,004.0 18.0

Initial Premiums 304.0 2.8 195.4 2.0 108.6 55.6

Renewal Premiums 6,276.7 57.6 5,381.4 55.2 895.3 16.6

Automobile 3,148.2 28.9 3,060.5 31.4 87.7 2.9

Total 10,895.1 100.0 9,744.9 100.0 1,150.2 11.8

Korean Won / in billions

AmountFY09

% AmountFY08

% AmountChange

%

Underwriting Efficiency

Loss Ratio 79.0% 76.6% 2.4%p

General 53.9% 56.2% -2.3%p

Long-term 84.7% 83.8% 0.9%p

Automobile 71.7% 67.2% 4.5%p

Expense Ratio 22.7% 23.0% -0.3%p

General 18.6% 16.3% 2.3%p

Long-term 18.8% 19.4% -0.6%p

Automobile 32.0% 31.1% 0.9%p

Combined Ratio 101.6% 99.6% 2.0%p

ChangeFY09 FY08

Samsung Fire & Marine InsuranceAnnual Report 2009

The overall expense ratio reached 22.7%, a drop of 0.3%p from the previous year. This was because SF&MI endeavored to improve

business costs, while deferred acquisition costs increased following a steep rise in the sales of new contracts. By item, the wages and

severance benefit ratio increased 0.1%p year-on-year to 5.4%, while distribution costs fell by 0.2%p. Business administration costs

decreased 0.5%p to 6.8%, but expenses recovered ratio increased slightly. The overall expense ratio stood at 22.7%, a 0.3%p decrease

from the previous year.

4. Investment Operation Profit

Investment operation profit in fiscal year 2009 was more than KRW1 trillion, representing year-on-year growth of 13.8%. Return on bond

trade stood at 5.7%, up 0.1%p from the previous year despite a recent drop in the interest rate because the company has steadily

expanded Korea Paper bearing high interest rate.

Net investment yield stood at 4.9% as in the previous year, on the back of increased profit from fixed income type assets, such as bonds

and loans. Income from stocks stood at KRW85.0billion, an increase of KRW25.8billion or 43.6% from the previous year mainly caused by

the disposal of beneficiary certificate. Profit from bonds and loans rose by 63.3billion and 13.1billion to KRW587.5 billion and KRW335.6

billion, respectively, thanks to a steady rise in interest income. Meanwhile, overseas investment yield jumped by KRW40.8 billion to

KRW63.0 billion from last year on account of base effects after the write-down of collateralized debt obligation (CDO) bonds and expansion

of KP.

Miscellaneous Business Expense Ratio

Wages and Severance Benefits Ratio 5.4% 5.3% 0.1%p

Distribution Costs 1) 12.0% 12.2% -0.2%p

Business Administration Costs 6.8% 7.3% -0.5%p

Expenses Recovered 2) -1.5% -1.9% 0.4%p

Total 22.7% 23.0% -0.3%p

ChangeFY09 FY08

1) acquisition and collection cost, agent commission, amortization of acquisition costs2) reinsurance commission, reinsurance profit commissions

058 059Financial Section Management Discussion & Analysis

MANAGEMENT DISCUSSION & ANALYSIS

5. Income Tax Expenses

In fiscal year 2009, Net profit before income tax fell by 16.2% or KRW132.6 billion to KRW688.2 billion from the year before, while income

tax expenses recorded KRW163.7 billion, a drop of KRW 58.4 billion from the previous year. The official corporate tax rate, including

residency tax, was set at 24.2%. However, the effective tax rate for the period was set at 23.8%, or a 3.3%p cut from the previous year.

Investment Income

Cash and Equivalents 16.9 29.6 -12.7 -42.9

Stocks 85.0 59.2 25.8 43.6

Bonds 587.5 524.2 63.3 12.1

Loans 335.6 322.5 13.1 4.1

Overseas 63.0 22.2 40.8 183.8

Real Estate 12.9 13.1 -0.2 -1.5

Total 1,100.9 970.7 130.2 13.4

Investment Administration Expenses 1) 91.2 83.1 8.1 9.7

Investment Income 1,009.7 887.6 122.1 13.8

Net Investment Yield 4.9% 4.9% 0.0

FY09 FY08

1) Bad debt expenses and depreciation costs have been distributed by assets

WonChange

%

Income Tax Charges

Income before income tax expenses 688.2 820.8 -132.6 -16.2

Income Tax Charges 163.7 222.1 -58.4 -26.3

Effective Tax Rate 23.8% 27.1% -3.3

FY09 FY08

Korean Won / in billions

WonChange

%, %p

Korean Won / in billions

Samsung Fire & Marine InsuranceAnnual Report 2009

B. Financial Statement

1. Financial Conditions

Total assets in fiscal year 2009 jumped 15.4% or KRW3,563.7 billion year-on-year to reach KRW26,655.9 billion. Stocks increased 38.9%

to KRW2,743.3 billion, mainly due to a rise in the share prices of affiliates and the subsequent gains in their valuation. Bond assets jumped

by KRW399.1 billion to KRW10,827.9 billion thanks to an increase in available-for-sale bonds, particularly bonds with high interest rates

such as government agency bond and bank debenture.

Loans increased by 18.9% year-on-year, totaling at KRW5,610.4 billion. Mortgage loans such as secured loans on real estate and

policyholder loans accounted for the largest share of loans. Overseas securities posted a 130.9% increase, the largest growth among

assets, mainly buoyed by the purchase of high yield bonds such as Korea Paper.

Total liabilities in fiscal year 2009 amounted to KRW21,715.6 billion, an increase of 12.9% or KRW2,486.4 billion from the previous year.

Policy reserves, which account for most of the liabilities, moved upward by 14.8% yoy to KRW18,085.5 billion. Catastrophe reserves jumped

6.9% yoy to KRW1,132.8 billion, while other liabilities and separate account liabilities climbed by 5.2% and 4.2%, respectively.

Total shareholders’ equity in fiscal 2009 rose 27.9% or KRW1,077.3 billion to KRW4,940.3 billion. Retained earnings grew 17.1% to

KRW2,642.2 billion, notwithstanding a drop in net profit. Accumulated other comprehensive income soared 73.7% from a year ago to KRW

1,627.5 billion on the strength of a sharp rise in gains on valuation of available-for-sales securities. The solvency margin ratio stood at

426.4% as of the end of March, 2010 in spite of the global financial crisis in 2009 thanks to a rise in gains on valuation of bonds and stocks

and an increase in retained earnings.

Statements of Financial Position Summary

Cash & Equivalents 303.2 1.1 596.0 2.6 -292.8 -49.1

Stocks 2,743.3 10.3 1,974.7 8.6 768.6 38.9

Bonds 10,827.9 40.6 10,428.8 45.2 399.1 3.8

Loans 5,610.4 21.0 4,720.3 20.4 890.1 18.9

Overseas 2,156.2 8.1 933.8 4.0 1,222.4 130.9

Real Estate 1,093.2 4.1 1,087.5 4.7 5.7 0.5

Non-invested Assets 3,921.7 14.7 3,351.2 14.5 570.5 17.0

Total Assets 26,655.9 100.0 23,092.2 100.0 3,563.7 15.4

Policy Reserves 18,085.5 67.8 15,747.7 68.2 2,337.8 14.8

Catastrophe Reserves 1,132.8 4.2 1,059.3 4.6 73.5 6.9

Other Liabilities 1,373.9 5.2 1,357.8 5.9 16.1 1.2

Separate A/C Liabilities 1,123.4 4.2 1,064.4 4.6 59.0 5.5

Total Liabilities 21,715.6 81.5 19,229.2 83.3 2,486.4 12.9

Shareholders’ Equity 4,940.3 18.5 3,863.0 16.7 1,077.3 27.9

Total Liabilities and

Shareholders’ Equity 26,655.9 100.0 23,092.2 100.0 3,563.7 15.4

Solvency Margin Ratio 426.4% 374.8%

Korean Won / in billions, %

AmountFY09

% AmountFY08

% WonChange

%

060 061Financial Section Management Discussion & Analysis

2. Securities

At the end of fiscal year 2009, securities including stocks and bonds grew by KRW1,167.8 billion or 9.4% from the previous year to

KRW13,571.2 billion. The stocks rose by 38.9% or KRW768.6 billion to KRW2,743.3 billion on account of a rise in the valuation of the

stocks of affiliates such as Samsung Electronics and Samsung Securities, which were classified as available-for-sales securities. Affiliates

equities accounted for a lion’s share, 67.8%, of the total portfolio, with beneficiary certificates following with a share of 25.2%. Stocks

applying equity method slid by KRW3.8 billion or 3.2% to KRW115.2billion.

Total bond assets were up 3.8% yoy or KRW399.1 billion to reach KRW10,827.9 billion at the end of fiscal year 2009. While short-term

trading bonds decreased by KRW80.6 billion to KRW61.3 billion, available-for-sale bonds, thanks to an increase in government agency

bonds and bank debentures, jumped by KRW479.8 billion or 4.7% compared to a year earlier to KRW10,636.5 billion.

3. Loans and Asset Quality

At the end of fiscal year 2009, loans were 5,656.4 billion, up 18.7% or KRW893.0 billion from a year ago. Household loans rose by 16.6%

% or KRW617.8 billion from the previous year to KRW 4,336.2 billion. Mortgage loans, among others, jumped by KRW 343.0 billion to

KRW2,387.4 billion. Policyholder loans were up by KRW275.8 billion or 16.9% to reach KRW1,910.9 billion. Corporate loans stood at

KRW1,320.2 billion with a year-on-year increase of 26.3% or KRW275.2 billion. Secured and non-secured loans rose by KRW230.2 billion

and KRW45.0 billion respectively, bringing the growth rate to as high as 25.3% and 33.3%, respectively.

It was revealed that the quality of loans had improved on a sustained basis. Substandard and below loans, despite the growth of loans, fell

by KRW7.1 billion to KRW8.1billlion, while the non-performing loans (NPL) ratio stood at 0.1%, down 0.2%p from a year before. Loan loss

provisions to substandard & below loans ratio soared 262.1%p to 528.6% from the previous year. Meanwhile, effective loan management

pulled down the delinquency ratio by 0.2%p to 0.2%, and the delinquency ratio of corporate loans to the 0% level from a year ago.

Securities

Stocks 2,743.3 1,974.7 768.6 38.9

Equities applying the equity method 115.2 119.0 -3.8 -3.2

Short-term trading Securities 0.5 0 0.5 N/A

Available for sale Securities 2,627.6 1,855.7 771.9 41.6

Bonds 10,827.9 10,428.8 399.1 3.8

Short-term trading Bonds 61.3 141.9 -80.6 -56.8

Available for sale Bonds 10,636.5 10,156.7 479.8 4.7

Held to maturity Bonds 130.1 130.1 0.0 0.0

Total Stocks 13,571.2 12,403.4 1,167.8 9.4

Korean Won / in billions

FY09 FY08 WonChange

%

MANAGEMENT DISCUSSION & ANALYSIS

Samsung Fire & Marine InsuranceAnnual Report 2009

Asset QualityKorean Won / in billions, %, %p

Total Loans 5,656.4 4,798.9 857.5 17.9

Normal 5,644.6 4,779.5 865.1 18.1

Precautionary 3.7 4.3 -0.6 -14.0

Substandard 6.8 11.3 -4.5 -39.8

Doubtful 0.6 1.2 -0.6 -50.0

Estimated Losses 0.7 2.6 -1.9 -73.1

Standard & below Loans 8.1 15.2 -7.1 -46.7

Non-Performing Loans to Total Loans Ratio 0.1% 0.3% -0.2

Loan Loss Provisions to Substandard &

below Loans Ratio 528.6% 266.5% 262.1

Delinquency Ratio 0.2% 0.4% -0.2

Retail 0.3% 0.5% -0.2

Corporate 0.0% 0.1% -0.1

WonFY09Change

%, %pFY08

Loans

Retail Loans 4,336.2 76.7 3,718.4 78.1 617.8 16.6

Mortgages 2,387.4 42.2 2,044.4 42.9 343.0 16.8

Policyholders 1,910.9 33.8 1,635.1 34.3 275.8 16.9

Non-secured 37.9 0.7 38.9 0.8 -1.0 -2.6

Corporate Loans 1,320.2 23.3 1,045.0 21.9 275.2 26.3

Secured 1,140.1 20.2 909.9 19.1 230.2 25.3

Non-secured 180.1 3.2 135.1 2.8 45.0 33.3

Total loans 5,656.4 100.0 4,763.4 100.0 893.0 18.7

Korean Won / in billions

WonFY09

% WonFY08

% WonChange

%

062 063Financial Section Management Discussion & Analysis

4. Asset & Liability Management

The ALM spread on long-term insurance in fiscal year 2009 proved to be in a better shape than the previous year. This is because reduced

market interest lightened the burden of interest on liabilities, while returns on matching assets rose thanks to the active purchasing of bonds

with high interest rates. Interest on liabilities fell 0.18%p to 4.64%, while returns on matching assets dwindled by 0.11%p from a year earlier

to 5.65%. At the end of fiscal year 2009, the ALM spread rose by 7bp yoy to 101bp. The duration matching rate between assets and

liabilities stood at 83.5%, a level similar to that of the previous year.

MANAGEMENT DISCUSSION & ANALYSIS

ALM on Long-term Insurance

Assets 1) 15,387.1 5.65 3.27 13,092.3 5.76 2.96 2,294.8 -0.11 -0.15

Liabilities 2) 14,958.8 4.64 3.92 12,840.9 4.82 3.36 2,117.9 -0.18 -0.05

Spread 428.3 1.01 -0.65 251.4 0.94 -0.55 176.9 0.07 -0.10

Korean Won / in billions, %, %p, yr

Amount Yield DurationFY09

Amount Yield DurationFY08

Amount Yield DurationChange

1) The sum of invested assets and unamortized deferred assets2) The sum of reserves for savings, unearned premiums and reserves for lapsed policies

Samsung Fire & Marine InsuranceAnnual Report 2009

INDEPENDENT AUDITORS’ REPORTENGLISH TRANSLATION OF A REPORT ORIGINALLY ISSUED IN KOREAN

To the Shareholders and Board of Directors ofSamsung Fire & Marine Insurance Co., Ltd.:

We have audited the accompanying balance sheets of Samsung Fire & Marine Insurance Co., Ltd. (the “Company”)as of March 31, 2010

and 2009, and the related statements of income, appropriations of retained earnings, changes in shareholders’ equity and cash flows for the

years then ended, all expressed in Korean won. These financial statements are the responsibility of the Company’s management. Our

responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted in the Republic of Korea.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free

of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial

statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as

evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Company as of

March 31, 2010 and 2009, and the results of its operations, changes in its retained earnings and shareholders’ equity, and its cash flows for

the years then ended, in conformity with accounting principles generally accepted in the Republic of Korea.

Our audits also comprehended the translation of Korea Won amounts into U.S. Dollar amounts and, in our opinion, such translation has

been made in conformity with the basis in Note 2. Such U.S. Dollar amounts are presented solely for the convenience of the reader outside

of Korea.

Accounting principles and auditing standards and their application in practice vary among countries. The accompanying financial statements

are not intended to present the financial position, results of operations, changes in its shareholder’s equity and cash flows in accordance

with accounting principles and practices generally accepted in countries other than the Republic of Korea. In addition, the procedures and

practices utilized in the Republic of Korea to audit such financial statements may differ from those generally accepted and applied in other

countries. Accordingly, this report and the accompanying financial statements are intended for use by those knowledgeable about Korean

accounting procedures and auditing standards and their application in practice.

Notice to ReadersThis report is effective as of May 20, 2010, the auditors’ report date. Certain subsequent events or circumstances may have occurred between the auditors’ report

date and the time the auditors’ report is read. Such events or circumstances could significantly affect the accompanying financial statements and may result in

modifications to the auditors’ report.

Deloitte refers to one or more of Deloitte Touche Tohmatsu, a Swiss Verein, and its network of member firms, each of which is a legally separate and independent entity. Please seewww.deloitte.com/kr/about for a detailed description of the legal structure of Deloitte Touche Tohmatsu and its member firms.

Member of Deloitte Touche Tohmatsu

Deloitte Anjin LLC14Fl., Hanwha Securities Bldg., 23-5 Yoido-dong,

Youngdeungpo-gu, Seoul 150-717, Korea

Tel:+82.2. 6676 1000 Fax:+82.2.6674 2114www.deloitteanjin.co.kr

May 20, 2010

064 065Financial Section Financial Statements

STATEMENTS OF FINANCIAL POSITIONAS OF MARCH 31, 2010 AND 2009

Korean Won / in millions

ASSETS

Cash and due from banks (Notes 3 and 17) ￦303,237 ￦595,980 $ 268,162 $ 527,043

Trading securities (Notes 4 and 8) 171,696 228,509 151,836 202,077

Available-for-sale securities (Notes 5, 8, 17 and 31) 15,310,394 12,859,532 13,539,435 11,372,066

Held-to-maturity securities (Note 6) 130,131 130,146 115,079 115,092

Securities accounted for using the equity method (Note 7) 115,157 119,015 101,837 105,249

Loans, net of allowance for doubtful accounts of￦42,934

million in 2010 and￦40,229 million in 2009, and deferred

loan origination fees of￦3,113 million in 2010 and￦2,839

million in 2009 (Notes 9 and 29) 5,610,366 4,720,338 4,961,414 4,174,335

Property and equipment, net (Notes 10, 14 and 24) 1,141,559 1,142,346 1,009,514 1,010,211

Insurance receivables, net of allowance for doubtful accounts of

￦8,730 million in 2010 and￦5,013 million in 2009

(Notes 9, 12, 17 and 29) 265,947 211,579 235,185 187,105

Leasehold and other deposits 206,992 203,809 183,049 180,235

Accrued income, net of allowance for doubtful accounts of

￦156 million in 2010 and￦162 million in 2009 (Note 9) 201,478 177,036 178,173 156,558

Compensation receivables (Note 13) 117,732 105,600 104,114 93,385

Deferred acquisition costs (Note 21) 1,638,606 1,304,936 1,449,068 1,153,994

Other assets (Notes 9, 11, 31 and 34) 324,012 245,975 286,533 217,522

Separate account assets, net of due to separate account of

￦34,260 million in 2010 and￦50,138 million in 2009

(Note 32) 1,118,579 1,047,358 989,192 926,209

Total assets ￦ 26,655,886 ￦23,092,159 $ 23,572,591 $ 20,421,081

LIABILITIES AND SHAREHOLDERS’ EQUITY

LIABILITIES:

Policy reserves (Notes 15, 31 and 38) ￦18,085,463 ￦15,747,731 $ 15,993,511 $ 13,926,186

Catastrophe reserves (Note 16) 1,132,825 1,059,285 1,001,790 936,757

Borrowings (Notes 5 and 18) 36,700 25,500 32,455 22,550

Insurance payables (Notes 12, 17 and 29) 329,596 274,745 291,472 242,965

Accrued expenses 157,485 151,115 139,269 133,635

Income tax payables (Note 23) 31,162 175,763 27,558 155,433

Rental deposits received (Note 31) 42,820 30,927 37,867 27,350

Deferred income tax liabilities (Note 23) 518,561 285,058 458,579 252,085

Other liabilities (Notes 2, 22, 31 and 34) 257,582 414,679 227,787 366,713

Separate account liabilities, net of due from separate account of

￦22,118 million in 2010 and￦31,376 million in 2009

(Notes 32) 1,123,364 1,064,385 993,424 941,267

Total liabilities 21,715,558 19,229,188 19,203,712 17,004,941

20102010 20092009

Translation into U.S. Dollars (Note 2) /In thousands

CONTINUED

Samsung Fire & Marine InsuranceAnnual Report 2009

20102010 20092009

Korean Won / in millions Translation into U.S. Dollars (Note 2) /In thousands

COMMITMENTS AND CONTINGENCIES (Note 31)

SHAREHOLDERS’ EQUITY (Notes 5, 8, 24, 25, 26 and 27):

Capital stock of￦500 par value,

Authorized (100,000,000 shares),

Issued and outstanding:

-Common stock (47,374,837 shares) ￦24,802 ￦24,802 $ 21,934 $ 21,934

-Preferred stock ( 3,192,000 shares) 1,671 1,671 1,478 1,478

26,473 26,473 23,412 23,412

Capital surplus 736,626 734,867 651,420 649,864

Capital adjustments (92,496) (92,708) (81,797) (81,985)

Accumulated other comprehensive income 1,627,537 937,168 1,439,279 828,765

Retained earnings 2,642,188 2,257,171 2,336,565 1,996,084

Total shareholders' equity 4,940,328 3,862,971 4,368,879 3,416,140

Total liabilities and shareholders' equity ￦26,655,886 ￦23,092,159 $ 23,572,591 $ 20,421,081

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.

066 067Financial Section Financial Statements

20102010 20092009

STATEMENTS OF INCOMEFOR THE YEARS ENDED MARCH 31, 2010 AND 2009

Korean Won/ In millions, except per share amounts

OPERATING REVENUES:

Premium income (Notes 19 and 29) ￦10,923,472 ￦9,737,109 $ 9,659,950 $ 8,610,814

Reinsurance income (Note 20) 316,109 357,585 279,544 316,223

Compensation income (loss) 12,132 (4,239) 10,729 (3,748)

Interest income:

Interest on deposits 17,226 29,811 15,233 26,363

Interest on securities (Notes 5 and 6) 655,987 570,574 580,109 504,575

Interest on loans 340,694 328,313 301,286 290,337

1,013,907 928,698 896,628 821,275

Gain on valuation and disposal of securities:

Gain on valuation of trading securities (Notes 4 and 8) 1,528 991 1,352 877

Gain on disposal of trading securities 5,290 2,425 4,678 2,145

Gain on disposal of available-for-sale securities 58,497 18,387 51,730 16,260

65,315 21,803 57,760 19,282

Gain on valuation and disposal of loans 2,187 985 1,934 871

Gain on foreign currency transactions 22,112 100,973 19,554 89,293

Dividend income 33,699 28,716 29,801 25,394

Commission income 567 12 501 11

Rental income 41,861 39,412 37,019 34,854

Expenses recovered 150,561 166,856 133,146 147,555

Other operating income:

Gain on valuation of derivatives (Note 31) 2,658 2,559 2,350 2,263

Gain on transaction of derivatives 39,469 5,155 34,903 4,559

Miscellaneous investment income 493 1,311 436 1,159

Miscellaneous income 710 621 629 549

Other - 38,407 - 33,965

43,330 48,053 38,318 42,495

Separate account income (Note 32) 637,012 444,768 563,329 393,321

13,262,264 11,870,731 11,728,213 10,497,640

OPERATING EXPENSES:

Provision for policy reserves (Note 31) 2,337,732 1,546,311 2,067,326 1,367,448

Provision for catastrophe reserves (Note 16) 73,540 72,609 65,033 64,210

Claims paid (Note 29) 3,711,895 3,450,403 3,282,539 3,051,294

Reinsurance premium expenses (Note 20) 791,879 775,700 700,282 685,975

Dividend expense 9,410 10,060 8,322 8,896

Refund of long-term insurance policies 2,313,472 2,243,094 2,045,872 1,983,635

Selling and general operating expenses (Notes 10, 22, 29 and 33) 1,796,503 1,690,949 1,588,701 1,495,357

Amortization of deferred acquisition costs (Note 21) 683,330 571,049 604,289 504,996

Interest expense 1,556 2,297 1,376 2,031

Loss on valuation and disposal of securities:

Loss on valuation of trading securities (Note 4) 6 9 5 8

Loss on disposal of trading securities 141 347 124 307

CONTINUED

Translation into U.S. Dollars (Note 2)/ In thousands, except per share amounts

Samsung Fire & Marine InsuranceAnnual Report 2009

20102010 20092009

Korean Won/ In millions, except per share amounts

Loss on disposal of available-for-sale securities ￦15,889 ￦20,834 $ 14,052 $ 18,424

Impairment loss of available-for-sale securities (Note 5) 18,872 9,033 16,689 7,988

34,908 30,223 30,870 26,727

Loss on valuation and disposal of loans 3,992 2,487 3,530 2,200

Loss on foreign currency transactions 63,246 73,768 55,930 65,235

Investment administrative expenses (Notes 10 and 22) 91,508 83,342 80,923 73,702

Maintenance expenses on investments 19,835 18,380 17,541 16,254

Depreciation expense on investments (Note 10) 8,861 7,705 7,836 6,814

Other operating expenses:

Loss on valuation of derivatives (Note 31) 1,641 14,696 1,451 12,996

Loss on transaction of derivatives 9,622 26,009 8,509 23,000

Miscellaneous investment expenses 4,699 2,900 4,155 2,564

Miscellaneous expenses 840 856 743 758

16,802 44,461 14,858 39,318

Separate account expense (Note 32) 637,012 444,768 563,329 393,321

12,595,481 11,067,606 11,138,557 9,787,413

OPERATING INCOME 666,783 803,125 589,656 710,227

OTHER INCOME (EXPENSES):

Gain on valuation of securities accounted for using the

equity method (Note 7) 19,402 18,083 17,157 15,991

Loss on valuation of securities accounted for using the

equity method (Note 7) (161) (230) (142) (203)

Gain (Loss) on disposal of securities accounted for using the

equity method (Note 7) - 6,951 - 6,147

Gain (Loss) on disposal of property and equipment, net 337 (56) 298 (50)

Donations (Note 35) (15,760) (15,147) (13,937) (13,395)

Separate account commission, net (Note 32) 11,111 7,200 9,826 6,368

Miscellaneous, net 6,493 879 5,742 777

21,422 17,680 18,944 15,635

INCOME BEFORE INCOME TAX 688,205 820,805 608,600 725,862

INCOME TAX EXPENSE (Note 23) 163,695 222,097 144,760 196,407

NET INCOME ￦524,510 ￦598,708 $ 463,840 $ 529,455

NET INCOME PER COMMON SHARE (Note 30) ￦11,823 ￦13,542 $ 10.46 $ 11.98

DILUTED NET INCOME PER COMMON SHARE (Note 30) ￦11,789 ￦13,488 $ 10.43 $11.93

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.

Translation into U.S. Dollars (Note 2)/ In thousands, except per share amounts

068 069Financial Section Financial Statements

20102010 20092009

STATEMENTS OF APPROPRIATIONS OF RETAINED EARNINGSFOR THE YEARS ENDED MARCH 31, 2010 AND 2009

Korean Won / In millions

RETAINED EARNINGS BEFORE APPROPRIATIONS:

Unappropriated retained earnings carried

over from prior years ￦431 ￦216 $ 381 $ 191

Net income 524,510 598,708 463,840 529,455

524,941 598,924 464,221 529,646

APPROPRIATIONS:

Dividends (Note 28) 139,682 139,493 123,525 123,359

Voluntary reserves 385,000 459,000 340,467 405,906

524,682 598,493 463,992 529,265

UNAPPROPRIATED RETAINED

EARNINGS TO BE CARRIED

FORWARD TO SUBSEQUENT YEAR ￦259 ￦431 $ 229 $ 381

Translation into U.S. Dollars (Note 2)/ In thousands

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.

Samsung Fire & Marine InsuranceAnnual Report 2009

STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITYFOR THE YEARS ENDED MARCH 31, 2010 AND 2009

As of April 1, 2008 ￦26,473 ￦733,749 ￦ (93,039) ￦950,596 ￦1,797,792 ￦3,415,571

Annual dividends - - - - (139,329) (139,329)

Balance after appropriations 26,473 733,749 (93,039) 950,596 1,658,463 3,276,242

Net income - - - - 598,708 598,708

Gain on disposal of treasury stock - 1,118 - - - 1,118

Disposal of treasury stock - - 1,362 - - 1,362

Exercise of stock options - - (1,031) - - (1,031)

Gain on valuation of available-for-sale securities - - - 103,614 - 103,614

Changes in equity arising from

application of the equity method - - - 19,009 - 19,009

Negative changes in equity arising from

application of the equity method - - - (472) - (472)

Cumulative translation debits - - - 21,489 - 21,489

Loss on valuation of cash flow hedge derivatives - - - (158,718) - (158,718)

Accumulated other comprehensive

income arising from separate account - - - 1,650 - 1,650

As of March 31, 2009 ￦26,473 ￦734,867 ￦ (92,708) ￦937,168 ￦2,257,171 ￦3,862,971

Korean Won / In millions

CONTINUED

Capital stock Capitalsurplus

Capitaladjustment

Accumulatedother

comprehensiveincome

Retainedearnings Total

As of April 1, 2009 ￦26,473 ￦734,867 ￦ (92,708) ￦937,168 ￦2,257,171 ￦3,862,971

Annual dividends - - - - (139,493) (139,493)

Balance after appropriations 26,473 734,867 (92,708) 937,168 2,117,678 3,723,478

Net income - - - - 524,510 524,510

Gain on disposal of treasury stock - 1,759 - - - 1,759

Disposal of treasury stock - - 1,558 - - 1,558

Exercise of stock options - - (1,346) - - (1,346)

Gain on valuation of available-for-sale securities - - - 556,334 - 556,334

Changes in equity arising from

application of the equity method - - - (12,806) - (12,806)

Negative changes in equity arising from

application of the equity method - - - (838) - (838)

Cumulative translation debits - - - (15,465) - (15,465)

Loss on valuation of cash flow hedge derivatives - - - 157,521 - 157,521

Accumulated other comprehensive

income arising from separate account - - - 5,623 - 5,623

As of March 31, 2010 ￦26,473 ￦736,626 ￦ (92,496) ￦1,627,537 ￦ 2,642,188 ￦4,940,328

Capital stock Capitalsurplus

Capitaladjustment

Accumulatedother

comprehensiveincome

Retainedearnings Total

070 071Financial Section Financial Statements

As of April 1, 2008 $ 23,412 $ 648,876 $ (82,277) $ 840,640 $ 1,589,841 $ 3,020,492

Annual dividends - - - - (123,212) (123,212)

Balance after appropriations 23,412 648,876 (82,277) 840,640 1,466,629 2,897,280

Net income - - - - 529,455 529,455

Gain on disposal of treasury stock - 988 - - - 988

Disposal of treasury stock - - 1,204 - - 1,204

Exercise of stock options - - (912) - - (912)

Gain on valuation of available-for-sale securities - - - 91,629 - 91,629

Changes in equity arising from

application of the equity method - - - 16,810 - 16,810

Negative changes in equity arising from

application of the equity method - - - (417) - (417)

Cumulative translation debits - - - 19,004 - 19,004

Loss on valuation of cash flow hedge derivatives - - - (140,360) - (140,360)

Accumulated other comprehensive

income arising from separate account - - - 1,459 - 1,459

As of March 31, 2009 $ 23,412 $ 649,864 $ (81,985) $ 828,765 $ 1,996,084 $ 3,416,140

Korean Won / In millions

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.

Capital stock Capitalsurplus

Capitaladjustment

Accumulatedother

comprehensiveincome

Retainedearnings Total

As of April 1, 2009 $ 23,412 $ 649,864 $ (81,985) $ 828,765 $ 1,996,084 $ 3,416,140

Annual dividends - - - - (123,359) (123,359)

Balance after appropriations 23,412 649,864 (81,985) 828,765 1,872,725 3,292,781

Net income - - - - 463,840 463,840

Gain on disposal of treasury stock - 1,556 - - - 1,556

Disposal of treasury stock - - 1,378 - - 1,378

Exercise of stock options - - (1,190) - - (1,190)

Gain on valuation of available-for-sale securities - - - 491,983 - 491,983

Changes in equity arising from

application of the equity method - - - (11,325) - (11,325)

Negative changes in equity arising from

application of the equity method - - - (741) - (741)

Cumulative translation debits - - - (13,676) - (13,676)

Loss on valuation of cash flow hedge derivatives - - - 139,300 - 139,300

Accumulated other comprehensive

income arising from separate account - - - 4,973 - 4,973

As of March 31, 2010 $ 23,412 $ 651,420 $ (81,797) $ 1,439,279 $ 2,336,565 $4,368,879

Capital stock Capitalsurplus

Capitaladjustment

Accumulatedother

comprehensiveincome

Retainedearnings Total

Samsung Fire & Marine InsuranceAnnual Report 2009

STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITYFOR THE YEARS ENDED MARCH 31, 2010 AND 2009

20102010 20092009

STATEMENTS OF CASH FLOWSFOR THE YEARS ENDED MARCH 31, 2010 AND 2009

Korean Won / In millions

CASH FLOWS FROM OPERATING ACTIVITIES:

Net income ￦524,510 ￦598,708 $ 463,840 $ 529,455

Adjustments to reconcile net income to net cash provided by

(used in) operating activities:

Gain on valuation of trading securities, net (1,522) (982) (1,347) (869)

Impairment loss on available-for-sale securities 18,872 9,033 16,689 7,988

Amortization of deferred acquisition cost 683,330 571,049 604,289 504,996

Loss (gain) on valuation of derivatives, net (1,017) 12,137 (899) 10,733

Gain on valuation of securities accounted for using the

equity method (19,402) (18,083) (17,157) (15,991)

Gain on disposal of securities accounted for using the

equity method - (6,951) - (6,147)

Loss on valuation of securities accounted for using the

equity method 161 230 142 203

Depreciation 53,338 56,060 47,168 49,575

Loss (gain) on disposal of property and equipment, net (337) 56 (298) 50

Amortization 30,682 32,916 27,133 29,109

Loss (gain) on foreign currency transactions, net 10,219 (28,651) 9,037 (25,337)

Bad debt expense 9,032 2,976 7,988 2,631

Net provision for policy and catastrophe reserves 2,411,272 1,618,920 2,132,359 1,431,658

Provision for severance indemnities 36,095 36,246 31,920 32,054

Miscellaneous loss, net 286 222 252 197

Interest income (15,924) (18,204) (14,082) (16,099)

Reversal of allowance for doubtful accounts (2,187) (985) (1,934) (871)

Compensation loss (income) (12,132) 4,239 (10,729) 3,748

Other operation income - (38,407) - (33,964)

Changes in assets and liabilities resulting from operations:

Decrease (increase) in trading securities 58,524 (29,262) 51,754 (25,879)

Increase in available-for-sale securities (1,748,667) (1,171,429) (1,546,398) (1,035,931)

Increase in held-to-maturity securities - (110,141) - (97,401)

Reception of dividends 9,157 1,010 8,098 893

Increase in loans, net (891,544) (602,005) (788,419) (532,370)

Increase in insurance receivables (61,816) (22,894) (54,666) (20,246)

Increase in leasehold and other deposits (3,592) (10,914) (3,177) (9,651)

Decrease (increase) in accrued income (24,436) 17,664 (21,609) 15,621

Increase in deferred acquisition costs (1,017,000) (743,509) (899,363) (657,507)

Decrease (increase) in financial derivative assets 2,924 (10,238) 2,586 (9,054)

Increase in other assets (43,546) (21,675) (38,508) (19,166)

Decrease (increase) in due from separate account 9,259 (11,589) 8,188 (10,249)

Increase in insurance payables 57,124 23,219 50,516 20,533

Increase in accrued expenses 6,370 20,809 5,633 18,402

Increase (decrease) in deferred income tax liabilities 33,084 (15,024) 29,257 (13,286)

CONTINUED

Translation into U.S. Dollars (Note 2)/ In thousands

072 073Financial Section Financial Statements

20102010 20092009

Korean Won / In millions

Payment of severance indemnities (15,495) (14,428) (13,703) (2,429)

Transfer of deposits from the National Pension Fund 76 31 68 27

Transfer-in of severance indemnities - 4,068 - 3,598

Increase in pension plan assets (14,746) (25,735) (13,040) (22,758)

Increase (decrease) in income tax payables (145,162) 93,467 (128,371) 82,656

Increase in rental deposits received 11,892 680 10,517 602

Increase (decrease) in financial derivative liabilities (16,009) 5,345 (14,157) 4,727

Increase (decrease) in other liabilities (5,189) 990 (4,590) 875

Increase (decrease) in due to separate account (15,878) 16,522 (14,041) 14,611

Increase (decrease) in overseas operation translation gain (15,465) 21,489 (13,676) 19,004

Net cash provided by (used in) operating activities (104,859) 246,980 (92,730) 218,411

CASH FLOWS FROM INVESTING ACTIVITIES:

Disposal of securities accounted for using the equity method - 10,191 - 9,012

Decrease (increase) in bank deposits 224,464 (62,691) 198,500 (55,440)

Disposal of property and equipment 734 1,366 650 1,208

Acquisition of property and equipment (52,776) (106,176) (46,671) (93,895)

Acquisition of securities accounted for using the equity Method (3,545) (4,088) (3,135) (3,615)

Acquisition of intangible assets (6,451) (12,178) (5,705) (10,769)

Net cash provided by (used in) investing activities 162,426 (173,576) 143,639 (153,499)

CASH FLOWS FROM FINANCING ACTIVITIES:

Payment of dividends (139,493) (139,329) (123,358) (123,212)

Increase in borrowings, net 11,200 300 9,904 265

Increase in bond sold under repurchase agreements - 25,200 - 22,285

Disposal of treasury stock 2,533 1,873 2,240 1,656

Net cash used in financing activities (125,760) (111,956) (111,214) (99,006)

NET DECREASE IN CASH AND CASH EQUIVALENTS (68,193) (38,552) (60,305) (34,094)

CASH AND DUE FROM BANKS, BEGINNING OF YEAR (Note 37) 218,583 257,135 193,299 227,393

CASH AND DUE FROM BANKS, END OF YEAR (Note 37) ￦150,390 ￦218,583 $ 132,994 $ 193,299

Translation into U.S. Dollars (Note 2)/ In thousands

SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.

STATEMENTS OF CASH FLOWSFOR THE YEARS ENDED MARCH 31, 2010 AND 2009

Samsung Fire & Marine InsuranceAnnual Report 2009

NOTES TO FINANCIAL STATEMENTSFOR THE YEARS ENDED MARCH 31, 2010 AND 2009

Common stock

Shareholders

Samsung Life Insurance Co., Ltd. 4,905,718 10.36 720 0.02

Samsung Card Co., Ltd. 2,298,377 4.85 - -

Tokio Marine & Nichido Fire Insurance Co., Ltd. 1,488,150 3.14 - -

Woori Bank (Korea Investment Management Co., Ltd.) 1,451,955 3.06 - -

Samsung Foundation of Culture 1,451,241 3.06 - -

Others 35,779,396 75.53 3,191,280 99.98

47,374,837 100.00 3,192,000 100.00

Preferred stock

1. GENERAL:

Samsung Fire & Marine Insurance Co., Ltd. (the “Company") was incorporated on January 26, 1952 under the Commercial Code of the

Republic of Korea to engage in non-life insurance and other related investment activities. The shares of the Company have been listed on

the Korea Stock Exchange since 1975. As of March 31, 2010, the Company’s issued common shares and preferred shares amounting to

￦24,802 million and ￦1,671 million, respectively.

The Company’s shareholders as of March 31, 2010 are as follows:

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

Basis of Financial Statement Presentation

The Company maintains its official accounting records in Korean won and prepares statutory financial statements in the Korean language

(Hangul) in conformity with the accounting principles generally accepted in the Republic of Korea. Certain accounting principles applied by

the Company that conform with financial accounting standards and accounting principles in the Republic of Korea may not conform with

generally accepted accounting principles in other countries. Accordingly, these financial statements are intended for use only by those who

are informed about Korean accounting principles and practices. The accompanying financial statements have been condensed, restructured

and translated into English (with certain expanded descriptions) from the Korean language financial statements. Certain information attached

to the Korean language financial statements, but not required for a fair presentation of the Company's financial position, results of operations,

changes in shareholders’ equity or cash flows, is not presented in the accompanying financial statements.

The accompanying financial statements are stated in Korean Won, the currency of the country in which the Company is incorporated and

operates. The translation of Korean Won amounts into U.S. Dollar amounts is included solely for the convenience of the readers outside of

the Republic of Korea and has been made at the rate of ￦1,130.80 to US$ 1.00 at March 31, 2010, the Base Rate announced by Seoul

Money Brokerage Services, Ltd. Such translation should not be construed as representations that the Korean Won amounts could be

converted at that or any other rate.

The 2010 financial statements to be submitted to the general meeting of shareholders were approved by the board of directors on May 6,

2010.

According to the revised Article 1-2 of the Act on External Audit for Stock Companies, the Company has renamed the balance sheets to

statements of financial position.

The significant accounting policies followed by the Company in the preparation of its financial statements are summarized below.

Numberof shares

Numberof shares

Percentage ofownership (%)

Percentage ofownership (%)

074 075Financial Section Financial Statements

Adoption of Statements of Korean Accounting Standards (“SKASs”)

(1) Newly adopted standards

Through March 31, 2010, the Korea Accounting Standards Board (“KASB”) has issued SKASs No. 1 through No. 25 to revise the previous

Financial Accounting Standards. Certain SKASs were amended, and interpretations and opinions were released. A summary of the

amended SKASs, Interpretations and Opinions, which have been adopted by the Company, is as follows:

Adopting the above amended standard had no impact on net income for the years ended March 31, 2010 and 2009, respectively, and net

assets as of March 31, 2010 and 2009, respectively.

(2) Recent Changes in Korean Accounting Standards

Korea Financial Accounting Standards, SKAS, Interpretation on Korea Financial Accounting Standards, Opinion on Application of Accounting

Standards and Opinion on Financial Reporting Practice (collectively referred to as “KFAS and others”) that were issued or amended by the

Korea Accounting Institute and the Financial Supervisory Service for the year ended March 31, 2010 and adopted by the Company for the

year ended March 31, 2010 are summarized below.

Key requirementsSKASs/Interpretation/Opinion

SKAS No. 5

"Property, Plant and Equipment"•Application of the cost method or the revaluation method may be elected by each type

of tangible asset. Consistent application of the method elected is required.

DescriptionAccounting standards

SKAS No. 15

“Investments in Associates” & SKAS No. 25

“Consolidated Financial statements”

Opinion on Application of

Accounting Standards 09-2

“Separate Disclosure of Contingent

Liabilities Regarding Real Estate

Project Financing”

•When preparing equity method accounting or consolidated financial statements,

investing companies subject to K-GAAP are not required to unify accounting treatments

and accounting assumptions of affiliates or equity method investees adopting K-IFRS.

•When contingent liabilities in relation with real estate PF transactions are disclosed in the

financial statements in accordance with SKAS.No.17, they should be distinguished from

other contingent liabilities.

•Significant contingent liabilities in relation with real estate PF transactions include the

following:

① Contingent liabilities in relation with payment guarantee provided by Constructor for

Developers’debt (Constructor)

② Contingent liabilities in relation with transferring loan by PF lenders (Bridge Financial

Company)

③ Contingent liabilities of institution facilitating liquidity (Liquidity facilities institution)

The adoption of the above amended standards had no impact on net income for the years ended March 31, 2010 and 2009, respectively,

and net assets as of March 31, 2010 and 2009, respectively.

NOTES TO FINANCIAL STATEMENTSFOR THE YEARS ENDED MARCH 31, 2010 AND 2009

Samsung Fire & Marine InsuranceAnnual Report 2009

Revenue Recognition

Revenues from premium income are recognized at the time when such premium payments become due. However, in the case of insurance

contracts of which the first premium payment or lump-sum premium payment are uncollected as of the first day of the insured period due to

payment extension allowed by the Company, the first premium payment or lump-sum premium payment may be recognized as revenue in

the period in which the first day of insured period falls. If premium income is received before the nominated collection date, the Company

records unearned insurance premium based on calendar period calculation.

The Company applies the accrual basis in recognizing interest income related to deposits, loans and securities, except for non-secured

uncollectible receivables. Interest on loans and collapsible corporation’s securities, whose principal or interest is past due at the end of the

reporting period, is generally not accrued. When a loan is placed on non-accrual status, previously accrued interest is generally reversed and

deducted from the current interest income, and future interest income is recognized on cash basis in accordance with the accounting

standard.

Investment Securities other than those Accounted for Using the Equity Method

Debt and equity securities are initially stated at the market value of consideration given for acquisition (market value of securities acquired if

market value of consideration given is not available) plus incidental costs attributable to the acquisition of the securities and are classified into

trading, available-for-sale and held-to-maturity securities depending on the purpose and nature of acquisition. The Company presents trading

securities as short-term investments, and available-for-sale securities and held-to-maturity securities as short-term investments or long-term

investment securities depending on their nature in the statements of financial position. The moving average method for equity securities and

the specific identification method for debt securities are used to determine the cost of securities for the calculation of gain (loss) on disposal

of those securities.

The following is the specific valuation method applied for debt and equity securities:

1) Trading securities

Securities that are bought and held principally for the purpose of selling them in the near term with active and frequent buying and selling,

including securities which consist of a portfolio of securities with the clear objective of generating profits on short-term differences in price,

are classified as trading securities. Trading securities are recorded at their fair value and unrealized gains or losses from trading securities are

recorded as gain (loss) on valuation of trading securities included in the operating income (expense).

2) Held-to-maturity securities

Debt securities that have fixed or determinable payments with a fixed maturity are classified as held-to-maturity securities only if the Company

has both the positive intent and ability to hold those securities to maturity. However, debt securities, whose maturity dates are due within one

year from the end of the reporting period, are classified as current assets.

After initial recognition, held-to-maturity securities are stated at amortized cost in the statements of financial position. When held-to-maturity

securities are measured at amortized costs, the difference between their acquisition cost and face value is amortized using the effective

interest rate method and the amortization is included in the cost and interest income.

076 077Financial Section Financial Statements

When the possibility of not being able to collect the principal and interest of held-to-maturity securities according to the terms of the

contracts is high, the difference between the recoverable amount (the present value of expected cash flows using the effective interest rate

upon acquisition of the securities) and book value is recorded as loss on impairment of held-to-maturity securities included in the operating

expense and the held-to-maturity securities are stated at the recoverable amount after impairment loss. If the value of impaired securities

subsequently recovers and the recovery can be objectively related to an event occurring after the impairment loss was recognized, the

reversal of impairment loss is recorded as reversal of impairment loss on held-to-maturity securities included in operating income. However,

the resulting carrying amount after the reversal of impairment loss shall not exceed the amortized cost that would have been measured at the

date of the reversal, if no impairment loss was recognized.

3) Available-for-sale securities

Debt and equity securities that do not fall under the classifications of trading or held-to-maturity securities are categorized and presented as

available-for-sale securities included in investment assets. However, if an available-for-sale security matures or it is certain that such security

will be disposed of within one year from the end of the reporting period, it is classified as a current asset.

Available-for-sale securities are recorded at fair value. Unrealized gain or loss from available-for-sale securities are presented as gain or loss

on valuation of available-for-sale securities included in accumulated other comprehensive income (loss) under shareholders’ equity. In

addition, accumulated gain or loss on valuation of available-for-sale securities is reflected in either gain or loss on disposal of available-for-

sale securities or loss on impairment of available-for-sale securities upon disposal or recognition of impairment of the securities. However,

available-for-sale equity securities that are not marketable and whose fair value cannot be reliably measured are recorded at acquisition cost.

When there is objective evidence that the available-for-sale securities are impaired and the recoverable amount is lower than the cost

(amortized cost for debt securities) of the available-for-sale securities, an impairment loss is recognized as loss on impairment of available-

for-sale securities in operating expense and the related unrealized gain or loss remaining in shareholders’ equity is adjusted to impairment

loss. If the value of impaired securities subsequently recovers and the recovery can be objectively related to an event occurring after the

impairment loss was recognized, the reversal of impairment loss can be recognized up to the previously recorded impairment loss as a

reversal of loss on impairment of available-for-sale securities in operating income. However, if the fair value increases after the impairment

loss is recognized but does not relate to the recovery of impairment loss as described above, the increase in fair value is recorded in

shareholders’ equity.

4) Reclassification of securities

Trading securities cannot be reclassified as other categories of securities. However, when those securities can no longer be held for sale in

the near-term to generate profits from short-term price differences, the trading securities can be reclassified as available-for-sale or held-to-

maturity securities. When those securities are no longer traded in an active market, such securities are reclassified as available-for-sale

securities.

When trading securities are reclassified to other categories, the fair value (latest market value) as of the date of the reclassification becomes

new acquisition cost of the security and the security’s unrealized holding gain or loss through the date of the reclassification is recorded in

the current income or expenses.

NOTES TO FINANCIAL STATEMENTSFOR THE YEARS ENDED MARCH 31, 2010 AND 2009

Samsung Fire & Marine InsuranceAnnual Report 2009

Securities Accounted for Using the Equity Method

Investments in equity securities of companies, over which the Company exercises significant influence, are reported using the equity method

of accounting.

1) Accounting for changes in the equity of the investee

Under the equity method of accounting, the Company records changes in its proportionate equity of the net assets of the investee

depending on the nature of the underlying changes in the investee as follows: (i) “gain (loss) on valuation of securities accounted for using

the equity method” in the non-operating income (expense) for net income (loss) of the investee; (ii) “increase (decrease) in retained earnings

of associates” in the retained earnings for changes in beginning retained earnings of the investee; and (iii) “increase (decrease) in equity of

associates” in accumulated other comprehensive income (loss) for other changes in shareholders’ equity of the investee.

When the equity method investee’s unappropriated retained earnings carried over from prior period changes due to significant error

corrections, the Company records the changes in equity as “gain (loss) on valuation of securities accounted for using the equity method”

included in the non-operating income (expense) if the impact of the changes on the Company’s non-consolidated financial statements is not

significant. If the changes results from the changes in accounting policies of the equity method investee, they are reflected in unappropriated

retained earnings carried over from prior period in accordance with SKAS on changes in accounting policy and errors corrections. When the

investee declares cash dividends, the dividends to be received are deducted directly from securities accounted for using the equity method.

2) Treatment of Investment difference

Difference between the acquisition cost and the Company’s proportionate equity in the fair value of net assets of the investee upon

acquisition (“Investment difference”) is considered as (negative) goodwill and accounted for in accordance with accounting standards for

business combination. The goodwill portion is amortized over useful lives within 20 years on a straight line method while the negative

goodwill portion is amortized over the weighted average useful lives of depreciable non-monetary assets of the investee. The amortization is

included in “gain (loss) on valuation of securities accounted for using the equity method”.

When the Company’s equity interest in the investee increases due to an increase (or decrease) in contributed capital with (or without)

consideration, the changes in the Company’s proportionate equity in the investee are accounted for as investment difference. If the

Company’s equity interest decreases, the changes are accounted for as “gain (loss) on sales of securities accounted for using the equity

method”. However, if the investee is the Company’s subsidiary, those changes are accounted for in the capital surplus (capital adjustments).

3) Difference between the fair value and book value of net asset of the investee

Upon acquisition of the securities accounted for using the equity method, the Company’s proportionate shares in the differences between

the fair values and book values of the identifiable assets and liabilities of the investee are amortized/reversed and included in “gain (loss) on

valuation of securities accounted for using the equity method” in accordance with the investee’s methods of accounting for the assets and

liabilities.

4) Elimination of unrealized gain or loss from intercompany transactions

The Company’s proportionate share in the gain (loss) arising from transactions between the Company and the investee, which remains in the

book value of assets held as of end of the reporting period, is considered unrealized gain (loss) and adjusted to securities accounted for

using the equity method. If the investee is a subsidiary of the Company, unrealized gain (loss) from sale of an asset by the Company to the

investee (downstream transaction) is fully eliminated and adjusted to securities accounted for using the equity method.

078 079Financial Section Financial Statements

NOTES TO FINANCIAL STATEMENTSFOR THE YEARS ENDED MARCH 31, 2010 AND 2009

5) Impairment loss on securities accounted for using the equity method

When there is objective evidence that the securities accounted for using the equity method is impaired and the recoverable amount is lower

than the carrying amount of the securities accounted for using the equity method, an impairment loss is recognized as “loss on impairment of

securities accounted for using the equity method” included in non-operating expense and the unamortized investment difference is first

reduced. When the recoverable amount is recovered after the recognition of impairment loss, the reversal of impairment loss is recognized

as income up to the previously recorded impairment loss. The book value of the securities accounted for using the equity method after the

reversal of the impairment loss cannot exceed the book value calculated as if the impairment loss would not been originally recognized. The

reversal of the impairment loss recognized against the unamortized investment difference is not allowed.

6) Translation of financial statements of overseas investees

For overseas investees whose financial statements are prepared in foreign currencies, the equity method of accounting is applied after

assets and liabilities are translated in accordance with the accounting treatments for the translation of the financial statements of overseas’

subsidiaries for consolidated financial statements. The Company’s proportionate share of the difference between assets net of liabilities and

shareholders’ equity after translation into Korean Won is accounted for as “increase (decrease) in equity of associates” included in

accumulated other comprehensive income (loss).

Allowance for Loan Losses

In accordance with the Regulation on Supervision of Insurance Business (the “Supervisory Regulation”) legislated by the Korean Financial

Supervisory Service (FSS) and the Company’s analysis of its assets and estimated loss on uncollectible accounts computed using past

collection experience, the Company classifies all credits into five categories as normal, precautionary, substandard, doubtful or estimated

loss, based on borrowers’repayment capability and historical financial transaction records. The Supervisory Regulation also requires the

Company to provide the minimum rate of loss provision for each category balance using the prescribed minimum percentages of 0.5

percent (individual loan is 0.75 percent) or more, 2 percent (individual loan is 5 percent) or more, 20 percent or more, 50 percent or more

and 100 percent, respectively.

However, the Company does not provide allowances for loans to the Korean government and local government entities, and call loans,

which are classified as normal, in accordance with the Accounting Standards for the Insurance Industry.

Troubled Debt Restructurings

The difference between the face value of the restructured receivable (payables) is recognized as bad debt expense or income for

circumstances in which contractual terms such as those on the face amount, interest rate, or maturity, have been modified to alleviate the

debtor’s burdens, as a result of an agreement between the creditor and the debtor or of an initiation of corporate reorganization procedures

under court trustee or under debtor’s management.

Property and Equipment

Property and equipment are stated at cost, except in the case of revaluation made in accordance with the Asset Revaluation Law on January

1, 1999. In addition, property and equipment acquired by investment in kind, donation, and free charge are stated at fair value. Significant

additions or improvements extending the useful lives of assets are capitalized. However, normal maintenance and repairs are charged to

expense as incurred.

Samsung Fire & Marine InsuranceAnnual Report 2009

The Company assesses any possible recognition of impairment loss when there is an indication that expected future economic benefits of a

tangible asset is considerably less than its carrying amount, as s result of technological obsolescence, rapid decline in market value or other

causes of impairment. When it is determined that an asset may have been impaired and that its estimated total future cash flows from

continued use or disposal is less than its carrying amount, the carrying amount of a tangible asset is reduced to its recoverable amount and

the difference is recognized as an impairment loss. If the recoverable amount of the impaired asset exceeds its carrying amount in

subsequent reporting period, the amount equal to the excess is treated as the reversal of the impairment loss, however, it cannot exceed the

carrying amount that would have been determined had no impairment loss been recognized.

Interest costs on borrowings for property and equipment are expensed as incurred.

Depreciation is computed by the declining-balance method (straight-line method for buildings and structures purchased from January 1,

1995) using the rates based on the useful lives of the respective assets as follows:

Development Costs and Other Intangible Assets

Expenditure on development incurred in conjunction with new software, in which the elements of cost can be identified and future economic

benefits are clearly expected, is capitalized and amortized on a straight-line basis over the expected periods to be benefited.

Other intangible assets, which are acquired by the Company, are stated at cost less accumulated amortization and impairment losses. Such

assets are amortized using the straight-line method over a reasonable period, based on the nature of the assets as follows:

Insurance Reserves

In accordance with Article 120 of the Insurance Business Law, the Company is required to maintain insurance reserves determined as

follows:

1) Reserve for outstanding claims

Reserve for outstanding claims is based on the accumulation of estimates for losses reported and incurred but not reported (IBNR) prior to

the end of the reporting period on the direct business written by the Company and estimates received from ceding companies.

Useful lives (years)

Buildings & Structures

Equipment

Vehicles

10-60

4-20

4

Useful lives (years)Goodwill

Development cost

Software

Others

5

5

4

4

080 081Financial Section Financial Statements

NOTES TO FINANCIAL STATEMENTSFOR THE YEARS ENDED MARCH 31, 2010 AND 2009

In accordance with the amended Regulation on Supervision of Insurance Business and Enforcement Rules of Supervision of Insurance

Business, the Company is required to report IBNR against long-term non-life insurance as reserve for outstanding claims.

2) Long-term insurance premium reserve

The Company maintains a reserve for the portion of premiums (and investment income on such portion), which is refundable to policyholders

upon maturity and cancellation of the policy under long-term deposit-type insurance, unless there has been a substantial claim for payment

under the policy.

3) Unearned premium reserve

The Company is required to maintain an unearned premium reserve at amounts determined based on lines of insurance and types of policy.

4) Reserves for participating policyholder dividend

The Company is required to maintain a reserve for participating policyholder dividend based on the regulations approved by the Governor of

the Financial Supervisory Service.

5) Excess participating policyholder dividend reserve

Pursuant to relevant laws and contracts, the Company may establish excess participating policyholder dividend reserve depending on the

operating results of related insurance products. The reserve may be used to pay participating policyholder dividend or additional dividend.

Catastrophe Reserves

Catastrophe reserves are required based on the regulations approved by the Governor of the Financial Supervisory Service. Non-life

insurance companies may establish a catastrophe reserve amounting to 35%~100% multiplied net cash premiums by reserve basic rate for

each type of insurance products in proportion to underwriting profit for the year, if any, up to 50% (in case of car insurance, 40%) of the

current year earned premiums. These reserves can be used against exceptionally large claims in the future.

Compensation Receivables

The Company recognizes compensation receivables according to Accounting Standards for the Insurance Industry and Insurance

Supervisory Regulations. Compensation receivables are calculated by multiplying the average recovery ratio (recovery amount/net claims) for

the last 3 years from the prior year end of the reporting period to the amount of net claims for the last year from the prior year end of the

reporting period claimed.

Accrued Severance Indemnities

In accordance with the Company's policy, all employees with more than one year of service are entitled to receive lump-sum severance

payments upon termination of their employment, based on their current rates of salary and length of service. The accrual for severance

indemnities is computed as if all employees were to terminate at the end of the reporting periods. The Company has made defined benefit

retirement pension plan and defined contribution retirement pension plan in Samsung Life Insurance Co., Ltd. and Samsung Securities Co.,

Ltd. to guarantee the employees’ pension right. Defined benefit retirement pension plan is a financial instrument, which pays a lump-sum

allowance at retirement or pays an annual pension after retirement through pension plan assets accumulated by the Company. Those

pension plan assets accumulated by the Company are presented as a deduction from accrued severance indemnities.

Samsung Fire & Marine InsuranceAnnual Report 2009

If an employee’s service period met the requirement to receive the benefit payment and elected to be the recipient of such severance

payment upon termination, present value of total severance liability to be paid to the terminated employee subsequent to the end of the

reporting period is estimated, recorded as severance payable and added to accrued severance indemnities. Defined contributions retirement

pension plan is a retirement plan where in a certain amount or percentage of money is set aside each year by the Company for the benefit of

the employee, and the expense is recognized as provision for severance indemnities.

Through March 1999, under the National Pension Law of Korea, the Company transferred a certain portion of retirement allowances of

employees to the National Pension Fund. The amount transferred reduces the severance indemnities amount payable to the employees

when they leave the Company and is reflected in the accompanying financial statements as a reduction from accrued severance

indemnities. However, from April 1999, a new regulation is applied and such transfers to the National Pension Fund are no longer required.

Separate Account Assets and Liabilities

In accordance with Article No.108 of the Insurance Business Law and Insurance Supervisory Regulations, all assets and liabilities related to

retirement benefit insurance and retirement benefit pension are managed and accounted for separately.

Deferred Acquisition Costs

Deferred acquisition costs are equally amortized over the period of premium payment of insurance contracts or over seven years for

insurance contracts of which premium payment period exceeds seven years. Further, if the insurance contracts are surrendered or have

lapsed, the related unamortized balance of deferred acquisition costs is charged to current operations.

Premium Deficiency

When the pre-assumed interest rate to be applied in accumulating premium reserve is higher than the interest rate for one year time deposits

and this situation is expected to continue for a long period, the Company is considered to have a premium deficiency. This situation is

becoming more common given the current low interest rate environment in Korea. The above reserve for premium deficiency is initially offset

against any unamortized deferred acquisition costs and then against the excess dividend reserve. The remaining balance, if any, is charged

to current operations.

Accounting for Foreign Currency Transactions and Translation

The Company maintains its accounts in Korean Won. Transactions in foreign currencies are recorded in Korean Won based on the prevailing

rates of exchange on the transaction date. Monetary accounts with balances denominated in foreign currencies are recorded and reported

in the accompanying financial statements at the exchange rates prevailing at the end of the reporting periods. The balances have been

translated using the basic rate announced by Seoul Money Brokerage Services, Ltd., and the resulting translation gains and losses are

reflected in current operations.

Translation of Financial Statements of Overseas Affiliates Stated in Foreign Currency

For overseas affiliates whose financial statements are prepared in foreign currency, assets and liabilities are translated at the exchange rate at

the end of the reporting period, shareholders’ equity is translated at the historical exchange rate, and items in statements of income are

recorded at the average exchange rate of the reporting period. Gain (loss) from foreign currency translation of overseas affiliate is recorded

as accumulated other comprehensive income (loss). When subsequent gain (loss) from foreign currency translation of overseas affiliate

arises, it is offset against the previously recognized gain (loss) and charged to gain or loss on the accounting period in which

such overseas affiliates are liquidated, closed or disposed of.

082 083Financial Section Financial Statements

NOTES TO FINANCIAL STATEMENTSFOR THE YEARS ENDED MARCH 31, 2010 AND 2009

Income Tax

When the Company recognizes deferred income tax assets or liabilities for the temporary differences between the carrying amount of an

asset and liability and tax base, a deferred income tax liability for taxable temporary difference is fully recognized except to the extent in

accordance with related SKAS while a deferred tax asset for deductible temporary difference is recognized to the extent that it is almost

certain that taxable profit will be available against which the deductible temporary difference can be utilized. Deferred income tax assets and

liabilities in the same tax jurisdiction are presented on a net basis.

Current and deferred income tax expense are included in income tax expense in the statements of income and additional income tax or tax

refunds for the prior periods are included in income tax expense for the current period when recognized. However, income tax resulting from

transactions or events, which was directly recognized in shareholders’ equity in current or prior periods, or business combinations, is directly

adjusted to equity account or goodwill (or negative goodwill).

Derivatives

Derivative instruments are presented as assets or liabilities valued principally at fair value of the rights or obligations associated with the

derivative contracts. The unrealized gain or loss from derivative transactions is recognized in current operations. However, for derivative

instruments for the purpose of hedging the exposure to the variability of cash flows of a forecasted transaction, the effective portion of the

derivative’s gain or loss is deferred as accumulated other comprehensive income (loss), a component of shareholders’ equity. The ineffective

portion of the gain or loss is charged or credited to current operations.

However, it’s considered for all portion of the hedge to be effective when evaluating the hedge effectiveness provided that the maturity, the

contract amount and the timing of the cash flows between the hedged items and the hedging instruments agreed with the principal contents

of the hedge contract.

Stock Options

The stock option program allows the Company’s employees to acquire shares of the Company. The option exercise price is generally fixed

below the market price of underlying shares at the date of the grant. The Company values stock options based on option pricing model

under the fair value method and recognizes this value as an expense over the period in which the options vest. When the options are

exercised, equity is increased by the amount of the proceeds received, and the difference between the exercise price and market price is

included in compensation cost and credited to the capital adjustment account.

Contingent Liabilities

Contingent losses are generally recognized as a liability when probable and reasonably estimable.

Recognition of Liabilities on Expired Insurance

If the payment obligation is actually granted to the Company in view of the public character of insurance transaction and the practice of

insurance industries, even though the extinctive prescription of insurance payment expired, the Company recognizes the amount expected

to pay as other liabilities.

Samsung Fire & Marine InsuranceAnnual Report 2009

2010

Equity securities ￦507 ￦529 ￦22 ￦-

Government and public bonds 9,909 9,966 57 9,726

Special bonds - - - 10,009

Corporate bonds 111 153 42 2,095

Beneficiary certificates 50,000 51,134 1,134 120,105

Securities denominated

in foreign currencies 109,647 109,914 267 86,574

￦170,174 ￦171,696 ￦1,522 ￦228,509

Translation into

U.S. Dollars (In thousands) (Note 2) $ 150,489 $ 151,836 $ 1,347 $ 202,077

2009

Fair value Valuation gain(loss)

Book valueBook valuebefore valuation

084 085Financial Section Financial Statements

20102010 20092009

Korean Won / In millions

Deposits for maintenance of checking accounts ￦11 ￦11 $ 10 $ 10

Collateral for swap - 36,595 - 32,362

Collateral for CLN - 110,168 - 97,425

Collateral for guarantee deposits 437 524 386 463

￦448 ￦147,298 $396 $ 130,260

Translation into U.S. Dollars (Note 2)/ In thousands

3. CASH AND DUE FROM BANKS:

Restricted due from banks as of March 31, 2010 and 2009 are as follows:

4. TRADING SECURITIES:

Trading securities as of March 31, 2010 and 2009 are as follows (Unit: Won in millions):

As the trading securities are valued at fair value, the gain on valuation of trading securities amounted to ￦1,528 million ($1,352 thousand)

and the loss on valuation of trading securities amounted to￦6 million ($ 5 thousand) for the year ended March 31, 2010.

20102010 20092009

NOTES TO FINANCIAL STATEMENTSFOR THE YEARS ENDED MARCH 31, 2010 AND 2009

5. AVAILABLE-FOR-SALE SECURITIES:

(1 ) Available-for-sale securities as of March 31, 2010 and 2009 are as follows:

(2) Changes in gain (loss) on valuation of available-for-sale securities recorded as accumulated other comprehensive income (before

deferred taxes), all of which are stated at fair value for the year ended March 31, 2010, are as follows (Unit: Won in millions):

(3) For the years ended March 31, 2010 and 2009, the Company recorded impairment loss on available-for-sale securities amounting to

￦18,872 million ($16,689 thousand) and￦9,033 million ($7,988 thousand), respectively, which are not expected to be recovered.

Korean Won / In millions

Equity securities ￦1,911,158 ￦1,424,883 $ 1,690,094 $ 1,260,066

Investments in partnerships 25,153 25,337 22,243 22,406

Government and public bonds 1,746,200 1,883,192 1,544,216 1,665,363

Special bonds 3,873,631 3,625,997 3,425,567 3,206,577

Financial company bonds 1,640,620 1,442,242 1,450,849 1,275,417

Corporate bonds 1,891,437 1,917,973 1,672,654 1,696,121

Beneficiary certificates 915,917 516,472 809,972 456,732

Securities denominated in foreign currencies 2,046,307 847,190 1,809,610 749,195

Others 1,259,971 1,176,246 1,114,230 1,040,189

￦15,310,394 ￦12,859,532 $ 13,539,435 $ 11,372,066

Translation into U.S. Dollars (Note 2)/ In thousands

Equity securities ￦1,198,392 ￦482,091 ￦ - ￦1,680,483

Government and public bonds 16,888 24,451 (2,703) 38,636

Special bonds 69,624 77,813 (9,539) 137,898

Financial company bonds 13,410 47,401 200 61,011

Corporate bonds 25,594 41,999 (1,437) 66,156

Beneficiary certificates (4,582) 51,253 (9,036) 37,635

Securities denominated in foreign currencies 71,115 (12,697) (1,834) 56,584

Others 15,301 29,066 (985) 43,382

￦1,405,742 ￦741,377 ￦ (25,334) ￦ 2,121,785

Translation into

U.S. Dollars (In thousands) (Note 2) $ 1,243,139 $ 655,622 $ (22,404) $ 1,876,357

DescriptionBeginning

balanceGain (loss) on

ValuationRealized on

disposalEnding balance

Samsung Fire & Marine InsuranceAnnual Report 2009

20102010 20092009

(4) Maturities of debt securities included in available-for-sale securities as of March 31, 2010 are as follows (Unit: Won in millions):

For the year ended March 31, 2010, the Company recognized interest income amounting to ￦3,363 million ($2,974 thousand) and

￦643,733 million ($569,272 thousand) related to trading securities and available-forsale securities, respectively.

(5) Available-for-sale securities pledged as collateral as of March 31, 2010 and 2009 are as follows:

In addition, the Company has lent government bonds amounting to￦327,897 million ($289,969 thousand) as of March 31, 2010.

Within 1 year ￦792,744 ￦806,040 ￦55,704 ￦55,875

Within 1 - 5 years 4,900,040 5,039,449 1,438,756 1,542,515

Within 5 - 10 years 2,831,146 2,943,809 1,151,907 1,204,356

More than 10 years 346,000 362,590 297,616 312,615

￦8,869,930 ￦9,151,888 ￦2,943,983 ￦3,115,361

Translation into

U.S. Dollars (In thousands) (Note 2) $ 7,843,942 $ 8,093,286 $ 2,603,452 $ 2,755,006

Face valueFace value Book valueBook value

Korean Won / In millions

KSFC (*) ￦26,788 ￦25,976 $ 23,689 $ 22,971

UBS (**) 51,854 65,418 45,856 57,851

ABN AMRO (**) 22,462 60,993 19,864 53,938

JP Morgan chase (**) 2,230 10,183 1,972 9,005

Industrial Bank of Korea (**) 60,865 - 53,825 -

Standard Chartered First Bank Korea (**) - 46,122 - 40,787

Calyon (**) - 30,829 - 27,263

￦164,199 ￦239,521 $ 145,206 $ 211,815

Translation into U.S. Dollars (Note 2)/ In thousands

Maturities

Description

Bonds (*) Securities (**)

(*) Bonds consist of government and public bonds, special bonds, financial company bonds and corporate bonds.

(**) Securities consist of securities denominated in foreign currencies and others.

(*)As of March 31, 2010 and 2009, the Company pledged available-for-sale securities for bond sold under repurchase agreements.

(**) As of March 31, 2010 and 2009, the Company pledged available-for-sale securities for foreign currency swap.

6. HELD-TO-MATURITY SECURITIES:

Held-to-maturity securities as of March 31, 2010 and 2009 are as follows (Unit: Won in millions):

Within 1 year Others ￦20,000 ￦20,000

Within 1 - 5 years Special bonds 60,000 59,968

Within 5 - 10 years Special bonds 50,000 50,163

￦130,000 ￦130,131

Translation into

U.S. Dollars (In thousands) (Note 2) $ 114,963 $ 115,079

2010Maturities Type Face value Book value

086 087Financial Section Financial Statements

NOTES TO FINANCIAL STATEMENTSFOR THE YEARS ENDED MARCH 31, 2010 AND 2009

7. SECURITIES ACCOUNTED FOR USING THE EQUITY METHOD:

(1) Securities accounted for using the equity method as of March 31, 2010 and 2009 consist of the following (Unit: Won in millions, dollars in

thousands):

2010

Within 5 years Others ￦20,000 ￦20,000

Special bonds 50,000 49,960

Within 5 - 10 years Special bonds 60,000 60,186

￦130,000 ￦130,146

Translation into U.S. Dollars (In thousands) (Note 2) $ 114,963 $ 115,092

2009Maturities Type Face value Book value

P.T Asuransi Samsung Tugu 70.00 ￦3,761 ￦7,793 ￦7,793 $ 6,892

Samsung Fire & Marine

Insurance Claim Adjustment Service 96.79 880 1,908 1,908 1,687

Anycar Claim Adjustment Service 100.00 250 690 690 610

Macquarie Central (*) 4.98 3,800 493 493 436

KOCREPVII (*) 4.83 2,900 2,817 2,817 2,491

New Airport Hiway (*) 1.38 3,042 5,150 5,150 4,554

KRII (*) 14.00 3,570 3,465 3,465 3,064

Samsung Vina Insurance 50.00 10,155 10,316 10,316 9,123

Samsung Fire & Marine Insurance of China Limited 100.00 32,594 82,123 82,123 72,624

Samsung Fire & Marine Consultoria em Seguros Ltda 100.00 509 402 402 356

￦61,461 ￦115,157 ￦115,157 $101,837

Investees Ownershipratio (%)

Acquisitioncost

Equity innet asset value Book value

Translation intoU.S.Dollars (Note 2)

2009

P.T Asuransi Samsung Tugu 70.00 ￦3,761 ￦6,430 ￦6,430 $ 5,686

Samsung Fire & Marine

Insurance Claim Adjustment Service 96.79 880 1,984 1,984 1,755

Anycar Claim Adjustment Service 100.00 250 682 682 603

Macquarie Central (*) 4.98 3,800 2,905 2,905 2,569

KOCREPVII (*) 4.83 2,900 2,864 2,864 2,533

New Airport Hiway (*) 1.38 3,042 4,412 4,412 3,902

KRII (*)(**) 14.00 3,570 3,340 3,340 2,954

Samsung Vina Insurance 50.00 7,119 8,712 8,712 7,704

Samsung Fire & Marine Insurance of China Limited 100.00 32,594 87,686 87,686 77,543

￦57,916 ￦119,015 ￦119,015 $105,249

Investees Ownershipratio (%)

Acquisitioncost

Equity innet asset value Book value

Translation intoU.S.Dollars (Note 2)

(*) The equity method has been applied as the Company is able to exercise significant influence over the operating and financial policies of the investees, which the

employees of the Company hold position directors of the investees.

(**) Disposal is restricted until August 2009 according to investment agreement.

For the years ended March 31, 2010 and 2009, the Company recognized interest income amounting to ￦8,891 million ($7,863 thousand)

and￦5,371 million ($4,750 thousand) related to held-to-maturity securities.

Samsung Fire & Marine InsuranceAnnual Report 2009

2010

P.T Asuransi Samsung Tugu ￦6,430 ￦476 ￦887 ￦7,793

Samsung Fire & Marine Insurance

Claim Adjustment Service 1,984 (76) - 1,908

Anycar Claim Adjustment Service 682 8 - 690

Macquarie Central 2,905 5,838 (8,250) 493

KOCREPVII 2,864 302 (349) 2,817

New Airport Hiway 4,412 738 - 5,150

KRII 3,340 684 (559) 3,465

Samsung Vina Insurance 8,712 937 667 10,316

Samsung Fire & Marine Insurance of China Limited 87,686 10,419 (15,982) 82,123

Samsung Fire & Marine Consultoria em Seguros Ltda - (85) 487 402

￦119,015 ￦19,241 ￦ (23,099) ￦115,157

Translation into

U.S. Dollars (In thousands) (Note 2) $105,249 $17,015 $(20,427) $101,837

InvesteesBeginning book

valueGain (loss) on

valuationOther increase

(decrease)Ending

book value

(2) The valuation of securities accounted for using the equity method for the years ended March 31, 2010 and 2009 was as follows (Unit:

Won in millions):

For the year ended March 31, 2009, the Company recognized gain on sales of securities accounted for using the equity method amounting

to￦6,951 million ($6,147 thousand) related to disposal of KOCREPIII.

2009

P.T Asuransi Samsung Tugu ￦4,677 ￦1,810 ￦ (57) ￦6,430

Samsung Fire & Marine Insurance

Claim Adjustment Service 1,047 937 - 1,984

Anycar Claim Adjustment Service 661 21 - 682

Macquarie Central 3,795 656 (1,546) 2,905

KOCREPIII 3,240 - (3,240) -

KOCREPVII 2,880 306 (322) 2,864

New Airport Hiway 3,772 640 - 4,412

KRII - (230) 3,570 3,340

Samsung Vina Insurance 2,887 889 4,936 8,712

Samsung Fire & Marine

Insurance of China Limited 50,974 12,824 23,888 87,686

￦73,933 ￦17,853 ￦27,229 ￦119,015

Translation into

U.S. Dollars (In thousands) (Note 2) $65,381 $15,788 $24,080 $105,249

InvesteesBeginning book

valueGain (loss) on

valuationOther increase

(decrease)Ending

book value

088 089Financial Section Financial Statements

NOTES TO FINANCIAL STATEMENTSFOR THE YEARS ENDED MARCH 31, 2010 AND 2009

Investees

(4) The market price of listed equity securities as of March 31, 2010 is as follows:

(3) The summarized financial information of investees of which securities are accounted for using the equity method as of and for the year

ended March 31, 2010 is as follows:

Korean Won / In millions

P.T Asuransi Samsung Tugu ￦16,400 ￦5,267 ￦22,188 ￦681

Samsung Fire & Marine Insurance Claim Adjustment Service 6,588 4,616 79,620 (78)

Anycar Claim Adjustment Service 5,044 4,354 52,141 8

Macquarie Central 9,941 43 164,140 96,017

KOCREPVII 125,813 67,529 16,161 6,243

New Airport Hiway 1,100,144 728,041 225,370 53,301

KRII (*) 56,982 32,235 32,188 4,887

Samsung Vina Insurance 30,631 9,999 24,730 1,874

Samsung Fire & Marine Insurance of China Limited 112,963 30,841 73,949 10,419

Samsung Fire & Marine Consultoria em Seguros Ltda 430 27 289 (85)

SalesTotal assets Net income (loss)Total liabilities

(*) For KRII, the Company decreased the securities accounted for using the equity method since it received dividend after the settling day of the investee.

(*) The Company does not calculate market value because Macquarie Central is going through liquidation as of March 31, 2010 and trading of its stocks is stopped in the

market.

Investees

Korean Won / In millions, except price pershare and number of shares)

Translation into U.S.Dollars (Note 2) / (In thousands)

Macquarie Central (*) ￦- 760,000 ￦- $ -

KOCREPVII 6,000 580,000 3,480 3,077

KRII 4,970 700,000 3,479 3,077

Market valuePrice per share Market valueNumber of shares

8. DISCRETIONARY ASSET MANAGEMENT CONTRACTS AND OTHERS:

(1) Discretionary asset management contracts

The Company has entered into discretionary asset management contracts with investment trust management company (Samsung Asset

Management Co., Ltd.), in order to manage trading securities and available-for-sale securities amounting to ￦9,967 million ($8,814

thousand) and￦6,691,493 million ($5,917,486 thousand), respectively, as of March 31, 2010.

The Company entrusts Prudential Financial, Inc. with the management of foreign investment securities among trading securities according to

the discretionary asset management contracts. All foreign investment securities are foreign bonds of which book value is ￦109,914 million

($97,200 thousand) and ￦86,574 million ($76,560 thousand) as of March 31, 2010 and 2009, respectively, and the gain amounting to

￦267 million ($236 thousand) and ￦541 million ($478 thousand) from foreign investment securities are reflected in the statements of

income for the years ended March 31, 2010 and 2009, respectively, as gain on valuation for trading securities.

Samsung Fire & Marine InsuranceAnnual Report 2009

(2) Private equity fund

The Company presents private equity fund as beneficiary certificates under trading securities and available-forsale securities. Private equity

fund as of March 31, 2010 and 2009 consists of the following:

The Company recognized gain on valuation of beneficiary certificates under trading securities in current operations amounting to ￦1,122

million ($992 thousand) for the year ended March 31, 2010, and gain on valuation of beneficiary certificates under available-for-sale

securities as accumulated other comprehensive income amounting to ￦11,672 million ($10,322 thousand) and ￦4,838 million ($4,278

thousand) for the years ended March 31, 2010 and 2009, respectively, related to private equity fund.

In addition, main assets of private equity fund as of March 31, 2010 are as follows:

Description

2010 2009

Beneficiary certificates ￦350,539 ￦363,001 ￦231,723 ￦237,112

Translation into U.S. Dollars

(In thousands)(Note 2) $ 309,992 $ 321,013 $ 204,920 $ 209,685

Acquisition costAcquisition cost Fair valueFair value

In millionsIn millions

Description Korean Won / In millions Translation into U.S. Dollars (Note 2) / (In thousands)

Equity securities ￦118,613 $ 104,893

Call loans 33,375 29,514

Bank deposits 7,092 6,272

Fixed deposits 8,850 7,826

Bonds 199,311 176,257

Derivatives 1,585 1,402

Other assets and liabilities, net (5,825) (5,151)

￦363,001 $ 321,013

090 091Financial Section Financial Statements

NOTES TO FINANCIAL STATEMENTSFOR THE YEARS ENDED MARCH 31, 2010 AND 2009

9. LOANS:

(1) In accordance with the Insurance Business Act and the Regulation on Supervision of Insurance Business, the Company provides various

loans. Loans as of March 31, 2010 bear an annual interest rate ranging from 4.04% to 15.50%. Ratios of allowance for loan losses are

0.92%, 0.96% and 1.11% in 2010, 2009 and 2008, respectively.

(2) Loans as of March 31, 2010 and 2009 are summarized as follows:

(3) Loans by maturity as of March 31, 2010 and 2009 are as follows:

Korean Won / In millions

Korean Won / In millions

Policy loans ￦1,910,859 ￦1,635,148 $ 1,689,829 $ 1,446,010

Loans secured by real estate 2,829,006 2,375,986 2,501,774 2,101,155

Unsecured loans 217,985 174,005 192,771 153,878

Loans secured by third party guarantees 1,362 2,205 1,205 1,950

Other loans 697,201 576,062 616,556 509,429

5,656,413 4,763,406 5,002,135 4,212,422

Allowance for loan losses (42,934) (40,229) (37,968) (35,576)

Deferred loan origination fees (3,113) (2,839) (2,753) (2,511)

￦5,610,366 ￦4,720,338 $ 4,961,414 $ 4,174,335

Translation into U.S. Dollars (Note 2)/ In thousands

20102010 20092009

2010

Policy loans ￦85,501 ￦104,696 ￦109,630 ￦181,315 ￦1,429,717 ￦1,910,859

Loans secured by real estate 137,233 110,068 88,365 248,813 2,244,527 2,829,006

Unsecured loans 52,169 46,675 73,709 45,333 99 217,985

Loans secured by

third party guarantees 589 428 332 13 - 1,362

Other loans 55,513 47,992 24,434 47,536 521,726 697,201

￦331,005 ￦309,859 ￦296,470 ￦523,010 ￦4,196,069 ￦5,656,413

Translation into

U.S. Dollars (In thousands) (Note 2) $ 292,718 $ 274,018 $ 262,177 $ 462,513 $ 3,710,709 $ 5,002,135

Within 1 - 2years

Within 2- 3years

Within 3- 5years

More than 5years

TotalWithin 1

year

Samsung Fire & Marine InsuranceAnnual Report 2009

(4) Loans to employees as of March 31, 2010 and 2009 are as follows:

(5) Loans by forward looking criteria as of March 31, 2010 and 2009 are summarized as follows:

Korean Won / In millions2009

Policy loans ￦83,423 ￦88,664 ￦104,445 ￦161,185 ￦1,197,431 ￦1,635,148

Loans secured by real estate 132,512 91,726 117,593 186,951 1,847,204 2,375,986

Unsecured loans 18,707 51,096 33,578 70,446 178 174,005

Loans secured by

third party guarantees 741 371 468 625 - 2,205

Other loans 74,701 31,581 42,000 24,974 402,806 576,062

￦310,084 ￦263,438 ￦298,084 ￦444,181 ￦3,447,619 ￦4,763,406

Translation into

U.S. Dollars (In thousands) (Note 2) $ 274,217 $ 232,966 $ 263,605 $ 392,802 $ 3,048,832 $ 4,212,422

Within 1 - 2years

Within 2- 3years

Within 3- 5years

More than 5years

TotalWithin 1year

Korean Won / In millions2010

Policy loans ￦1,910,859 ￦- ￦- ￦- ￦- ￦1,910,859

Loans secured by real estate 2,817,431 3,647 6,838 403 687 2,829,006

Unsecured loans 217,902 42 - 13 28 217,985

Loans secured by third party guarantees 1,359 3 - - - 1,362

Other loans 697,048 - - 153 - 697,201

5,644,599 3,692 6,838 569 715 5,656,413

Insurance receivables (*) 131,702 12,737 5,318 9,167 2,170 161,094

Other receivables 143,157 107 110 2,514 281 146,169

Accrued income 21,828 82 - - - 21,910

Notes receivable 1,957 - - - - 1,957

Other assets (**) - - 114 - - 114

298,644 12,926 5,542 11,681 2,451 331,244

Total ￦5,943,243 ￦16,618 ￦12,380 ￦12,250 ￦3,166 ￦5,987,657

Translation into U.S. Dollars

(In thousands) (Note 2) $ 5,255,786 $14,696 $10,948 $ 10,833 $ 2,800 $ 5,295,063

Precautionary Substandard Doubtful Loss TotalNormal

Korean Won / In millions

Loans secured by real estate ￦27,910 ￦27,647 $ 24,682 $ 24,449

Unsecured loans 31,201 32,306 27,592 28,569

Loans secured by third party guarantees 1,068 1,801 944 1,593

Other loans 29 29 26 26

￦60,208 ￦61,783 $ 53,244 $ 54,637

Translation into U.S. Dollars (Note 2)/ In thousands

20102010 20092009

092 093Financial Section Financial Statements

NOTES TO FINANCIAL STATEMENTSFOR THE YEARS ENDED MARCH 31, 2010 AND 2009

Korean Won / In millions2009

Policy loans ￦1,635,148 ￦- ￦- ￦- ￦- ￦1,635,148

Loans secured by real estate 2,356,897 4,232 11,343 1,006 2,508 2,375,986

Unsecured loans 173,835 30 - 76 64 174,005

Loans secured by third party guarantees 2,196 9 - - - 2,205

Other loans 575,895 - - 167 - 576,062

4,743,971 4,271 11,343 1,249 2,572 4,763,406

Insurance receivables (*) 100,853 8,184 526 4,045 2,218 115,826

Other receivables 118,202 111 308 2,371 123 121,115

Accrued income 22,261 94 - - - 22,355

Notes receivable 2,496 - - - - 2,496

Other assets (**) - - 270 - - 270

243,812 8,389 1,104 6,416 2,341 262,062

Total ￦4,987,783 ￦12,660 ￦12,447 ￦7,665 ￦4,913 ￦5,025,468

Translation into

U.S. Dollars (In thousands) (Note 2) $ 4,410,845 $11,196 $ 11,007 $ 6,778 $ 4,345 $ 4,444,171

Precautionary Substandard Doubtful Loss TotalNormal

(*) Net of insurance payables

(**) The Company reserves allowance for doubtful accounts for credit provisional payment.

(6) Loans classified as loss but haven’t met its extinctive prescription or lost its claim are as follows:

2010 2009

Loans ￦715 ￦715 ￦2,572 ￦2,572

Insurance receivables 2,170 1,457 2,218 938

Other receivables 281 281 123 123

￦3,166 ￦2,453 ￦4,913 ￦3,633

Translation into

U.S. Dollars (In thousands) (Note 2) $ 2,800 $ 2,169 $ 4,345 $ 3,213

LoansLoans ClaimClaim

In millionsIn millions

Samsung Fire & Marine InsuranceAnnual Report 2009

20102010 2009

10. PROPERTY AND EQUIPMENT:

(1) The details of property and equipment as of March 31, 2010 and 2009 are as follows:

As of March 31, 2010 and 2009, the published value of land is ￦518,179 million ($458,241 thousand) and ￦518,328 million

($458,373 thousand), respectively, based on the disclosed public land price announced by the government pursuant to the Laws

on Disclosure of Land Price and Valuation of Land.

(2) The change in property and equipment for the year ended March 31, 2010 is as follows (Unit: Won in millions):

In addition, depreciation for the year amounting to£‹44,053 million ($38,957 thousand), ￦424 million ($375 thousand) and ￦8,861

million ($7,836 thousand) is charged in selling and general operating expenses, investment administrative expenses and

depreciation expense on investments, respectively.

(3) As of March 31, 2010, the Company’s land and buildings pledged as collateral for rental deposits received and collateralized

amounts are ￦118,210 million ($104,537 thousand).

Korean Won / In millions

Land ￦412,703 ￦411,998 $ 364,965 $ 364,342

Buildings 829,475 810,059 733,529 716,359

Structures 3,124 2,826 2,763 2,499

Furniture and other equipment 341,249 328,203 301,777 290,240

Vehicles 1,506 1,791 1,332 1,584

Construction in progress 8,495 3,493 7,512 3,089

1,596,552 1,558,370 1,411,878 1,378,113

Accumulated depreciation (454,993) (416,024) (402,364) (367,902)

￦1,141,559 ￦1,142,346 $ 1,009,514 $ 1,010,211

Translation into U.S. Dollars (Note 2)/ In thousands

2009

Land ￦411,998 ￦695 ￦- ￦- ￦10 ￦412,703

Buildings 669,938 4,005 188 19,644 15,614 669,725

Structures 2,039 39 - 98 259 2,239

Furniture and other equipment 54,503 27,152 32 33,394 - 48,229

Vehicles 375 - 5 202 - 168

Construction in progress 3,493 20,885 - - (15,883) 8,495

￦1,142,346 ￦52,776 ￦225 ￦53,338 ￦- ￦1,141,559

Translation into

U.S. Dollars (In thousands) (Note 2) $ 1,010,211 $ 46,671 $ 200 $ 47,168 $ - $ 1,009,514

Acquisition Disposal DepreciationTransfer from

other accountsEnding

book valueBeginning

book value

094 095Financial Section Financial Statements

20102010 2009

2010 2009

NOTES TO FINANCIAL STATEMENTSFOR THE YEARS ENDED MARCH 31, 2010 AND 2009

11. INTANGIBLE ASSETS:

The details of intangible assets as of March 31, 2010 and 2009 are as follows:

12. INSURANCE RECEIVABLES AND INSURANCE PAYABLES:

Insurance receivables and insurance payables as of March 31, 2010 and 2009 are as follows:

Korean Won / In millions

Goodwill ￦- ￦53 $ - $ 47

Development cost 57,046 62,171 50,447 54,980

Software 17,556 20,226 15,525 17,886

Others 69 34 61 30

￦74,671 ￦82,484 $ 66,033 $ 72,943

Translation into U.S. Dollars (Note 2)/ In thousands

Korean Won / In millions

Insurance receivables:

Insurance receivable ￦125,984 ￦87,398 $ 111,412 $ 77,289

Due from agents 2,056 580 1,818 513

Co-insurance receivable 1,209 1,525 1,069 1,348

Receivables related to agency business 16,942 11,439 14,982 10,116

Reinsurance accounts receivable 71,892 69,939 63,576 61,849

Overseas reinsurance premiums receivable 50,645 39,974 44,787 35,350

Deposits on reinsurance treaty ceded 5,949 5,737 5,261 5,073

274,677 216,592 242,905 191,538

Less: Allowance for doubtful accounts (8,730) (5,013) (7,720) (4,433)

￦265,947 ￦211,579 $ 235,185 $ 187,105

Insurance payables:

Claims payable ￦50,521 ￦39,599 $ 44,677 $ 35,019

Due to agents 49,401 40,206 43,687 35,555

Premiums refund payable 13,494 6,325 11,933 5,593

Payables related to agency business 33,448 29,564 29,579 26,144

Reinsurance accounts payable 119,785 88,212 105,930 78,009

Overseas reinsurance premiums payable 45,559 51,695 40,289 45,715

Deposits on reinsurance treaty ceded 17,388 19,144 15,377 16,930

￦329,596 ￦274,745 $ 291,472 $ 242,965

Translation into U.S. Dollars (Note 2)/ In thousands

2010 2009

2009

Samsung Fire & Marine InsuranceAnnual Report 2009

13. COMPENSATION RECEIVABLES:

Compensation receivables as of March 31, 2010 and 2009 are as follows:

14. INSURED ASSETS:

Insured assets of the Company as of March 31, 2010 are as follows:

In addition, the Company is insured against various indemnity liabilities.

Korean Won / In millions

Fire insurance ￦703 ￦561 $ 622 $ 496

Marine insurance 4,673 2,749 4,132 2,431

Automobile insurance 105,486 96,734 93,284 85,545

Special insurance 3,256 2,362 2,879 2,089

Guarantee insurance 832 835 736 738

Overseas insurance 521 285 461 252

Long-term insurance 2,266 2,107 2,004 1,863

Pension insurance (5) (33) (4) (29)

￦117,732 ￦105,600 $ 104,114 $ 93,385

Translation into U.S. Dollars (Note 2)/ In thousands

20102010 20092009

Korean Won / In millions

Package insurance Office buildings & structures ￦1,200,590 $ 1,061,717

Translation into U.S. Dollars (Note 2)/ In thousands

Type Insured assets Insured amount Insured amount

096 097Financial Section Financial Statements

General Automobile Long-term Pension Total

General Automobile Long-term Pension Total

NOTES TO FINANCIAL STATEMENTSFOR THE YEARS ENDED MARCH 31, 2010 AND 2009

15. POLICY RESERVES:

(1) Policy reserves as of March 31, 2010 are summarized as follows:

(2) Policy reserves as of March 31, 2009 are summarized as follows:

Korean Won / In millions

Outstanding claims ￦521,161 ￦579,946 ￦423,523 ￦18,135 ￦1,542,765

Long-term insurance - - 10,927,637 3,766,809 14,694,446

Unearned premiums 665,898 1,508,353 109,356 7,214 2,290,821

Participating policyholders’ dividends - - 4,923 184,397 189,320

Excess participating policyholders’ dividends - - 1,470 34,611 36,081

Reserve for reinsurance Premiums (659,600) (130) (8,092) (148) (667,970)

￦527,459 ￦2,088,169 ￦11,458,817 ￦4,011,018 ￦18,085,463

General Automobile Long-term Pension Total

General Automobile Long-term Pension Total

Translation into U.S. Dollars (Note 2) / In thousands

Outstanding claims $ 460,878 $ 512,863 $ 374,534 $ 16,037 $1,364,312

Long-term insurance - - 9,663,634 3,331,101 12,994,735

Unearned premiums 588,873 1,333,881 96,707 6,380 2,025,841

Participating policyholders’ dividends - - 4,353 163,068 1,677,421

Excess participating policyholders’ dividends - - 1,300 30,608 31,908

Reserve for reinsurance Premiums (583,304) (115) (7,156) (131) (590,706)

$ 466,447 $ 1, 846,629 $ 10,133,372 $ 3,547,063 $ 15,993,511

Korean Won / In millions

Outstanding claims ￦430,336 ￦612,050 ￦372,821 ￦16,004 ￦1,431,211

Long-term insurance - - 9,602,254 3,062,020 12,664,274

Unearned premiums 592,947 1,408,838 20,896 6,987 2,029,668

Participating policyholders’ dividends - - 5,763 158,128 163,891

Excess participating policyholders’ dividends - - 2,100 24,439 26,539

Reserve for reinsurance premiums (558,270) (999) (8,443) (140) (567,852)

￦465,013 ￦2,019,889 ￦9,995,391 ￦3,267,438 ￦15,747,731

Translation into U.S. Dollars (Note 2) / In thousands

Outstanding claims $380,559 $541,254 $329,697 $14,153 $1,265,663

Long-term insurance - - 8,491,558 2,707,835 11,199,393

Unearned premiums 524,361 1,245,877 18,479 6,179 1,794,896

Participating policyholders’ dividends - - 5,096 139,837 144,933

Excess participating policyholders’ dividends - - 1,857 21,612 23,469

Reserve for reinsurance premiums (493,695) (883) (7,466) (124) (502,168)

$ 411,225 $ 1,786,248 $ 8,839,221 $ 2,889,492 $ 13,926,186

Samsung Fire & Marine InsuranceAnnual Report 2009

20102010 20092009

16. CATASTROPHE RESERVES:

Catastrophe reserves as of March 31, 2010 and 2009 are summarized as follows:

17. ASSETS AND LIABILITES DENOMINATED IN FOREIGN CURRENCY:

Assets and liabilities denominated in foreign currency as of March 31, 2010 and 2009 are summarized as follows (Unit: Won in

millions, dollars in thousands):

Korean Won / In millions

Beginning balance ￦1,059,285 ￦986,676 $ 936,757 $ 872,547

Net increase:

Fire insurance (14) - (12) -

Marine insurance 1,822 1,468 1,611 1,298

Automobile insurance 52,429 54,012 46,364 47,764

Special insurance 17,865 16,243 15,798 14,364

Overseas insurance 1,438 886 1,272 784

Sub total 73,540 72,609 65,033 64,210

Ending balance ￦1,132,825 ￦1,059,285 $1,001,790 $ 936,757

Translation into U.S. Dollars (Note 2)/ In thousands

2010

2010 2009

2009

Assets:

Due from banks $ 10,772 ￦12,181 146,081 ￦201,168

Overseas securities 39,886 45,103 39,672 54,632

Insurance receivables 38,691 43,752 24,890 34,276

Liabilities:

Insurance payables $ 47,314 ￦53,502 $ 38,533 ￦53,064

LoansU.S. DollarsU.S. Dollars Korean Wonequivalent (*)

Korean Wonequivalent (*)

(*) The Korean Won equivalent of assets and liabilities denominated in foreign currency are translated in these financial statements based on the basic rate (￦1,130.80

and ￦1,377.10 to US$1.00 at March 31, 2010 and 2009, respectively) or cross rates for other currencies announced by Seoul Money Brokerage Services Ltd. at the

end of the reporting periods.

18. BORROWINGS:

Borrowings as of March 31, 2010 and 2009 consist of the following:

Type Bank Annual interest rate

Korean Won / In millions

Call money Hyundai Investment Co., Ltd. 2.15% ￦11,500 300

Bond sold under

repurchase agreement KSFC 2.19% 25,200 25,200

￦36,700 ￦25,500

Translation into U.S. Dollars (Note 2) $ 32,455 $ 22,550

098 099Financial Section Financial Statements

Primary premiumAssumed

reinsurancepremium

Refund ofsurrender

value

Assumedreinsurance’s

refund ofsurrender value

Premiumincome

NOTES TO FINANCIAL STATEMENTSFOR THE YEARS ENDED MARCH 31, 2010 AND 2009

(2) Premium income for the year ended March 31, 2009 is as follows:

19. PREMIUM INCOME:

(1) Premium income for the year ended March 31, 2010 is as follows:

Fire insurance ￦44,423 ￦ - ￦ (397) ￦ - ￦44,026

Marine insurance 222,027 709 (2,679) - 220,057

Automobile insurance 3,148,219 - (140,754) - 3,007,465

Special insurance 881,297 1,955 (4,359) - 878,893

Guarantee insurance - 4 - - 4

Overseas insurance 18,391 141,750 - - 160,141

Long term insurance 5,765,479 - - - 5,765,479

Pension insurance 815,293 - - - 815,293

Incidental business - 32,114 - - 32,114

￦10,895,129 ￦176,532 ￦ (148,189) ￦- ￦10,923,472

Translation into

U.S. Dollars (In thousands) (Note 2) $ 9,634,886 $ 156,112 $ (131,048) $ - $ 9,659,950

Primary premiumAssumed

reinsurancepremium

Refund ofsurrender

value

Assumedreinsurance’s

refund ofsurrender value

Premiumincome

Korean Won / In millions

Fire insurance ￦48,326 ￦ - ￦ (327) ￦ - ￦47,999

Marine insurance 281,951 1,021 (2,184) - 280,788

Automobile insurance 3,060,513 - (142,522) - 2,917,991

Special insurance 760,079 3,496 (2,430) - 761,145

Guarantee insurance - 7 - - 7

Overseas insurance 17,273 108,632 - (1,552) 124,353

Long term insurance 5,013,973 - - - 5,013,973

Pension insurance 562,784 - - - 562,784

Incidental business - 28,069 - - 28,069

￦9,744,899 ￦141,225 ￦ (147,463) ￦ (1,552) ￦9,737,109

Translation into

U.S. Dollars (In thousands) (Note 2) $ 8,617,703 $ 124,889 $ (130,406) $ (1,372) $ 8,610,814

Korean Won / In millions

Samsung Fire & Marine InsuranceAnnual Report 2009

20102010 20092009

20102010 20092009

20102010 20092009

20102010 20092009

20. REINSURANCE:

(1) Reinsurance income for the years ended March 31, 2010 and 2009 is as follows:

(2) Reinsurance premium expenses for the years ended March 31, 2010 and 2009 are as follows:

Korean Won / In millions

Reinsurance claims ￦324,073 ￦375,927 $ 286,587 $ 332,443

Reinsurance refund paid 7,964) (18,342) (7,043) (16,220)

Reinsurance income ￦316,109 ￦357,585 $ 279,544 $ 316,223

Translation into U.S. Dollars (Note 2)/ In thousands

Korean Won / In millions

Reinsurance premium ￦796,694 ￦780,192 $ 704,540 $ 689,947

Cancellation refund received (4,815) (4,492) (4,258) (3,972)

Reinsurance premium expenses ￦791,879 ￦775,700 $ 700.282 $ 685,975

Translation into U.S. Dollars (Note 2)/ In thousands

21. DEFERRED ACQUISITION COSTS:

Changes in deferred acquisition costs for the years ended March 31, 2010 and 2009 are as follows:Korean Won / In millions

Beginning balance ￦1,304,936 ￦ 1,132,476 $ 1,153,994 $ 1,001,483

Increase 1,017,000 743,509 899,363 657,507

Amortization (683,330) (571,049) (604,289) (504,996)

Ending balance ￦1,638,606 ￦1,304,936 $ 1,449,068 $ 1,153,994

Translation into U.S. Dollars (Note 2)/ In thousands

22. ACCRUED SEVERANCE INDEMNITIES:

Changes in accrued severance indemnities for the years ended March 31, 2010 and 2009 are as follows:Korean Won / In millions

Beginning balance ￦174,898 ￦149,012 $ 154,668 $ 131,775

Provision for the year 36,095 36,246 31,920 32,054

Succession from others - 4,068 - 3,598

Payment during the year (15,495) (14,428) (13,703) (12,759)

Ending balance 195,498 174,898 172,885 154,668

National Pension payments (1,161) (1,238) (1,027) (1,095)

Retirement pension plan assets (136,085) (121,339) (120,344) (107,304)

￦58,252 ￦52,321 $ 51,514 $ 46,269

Translation into U.S. Dollars (Note 2)/ In thousands

100 101Financial Section Financial Statements

20102010 20092009

20102010 20092009

20102010 20092009

NOTES TO FINANCIAL STATEMENTSFOR THE YEARS ENDED MARCH 31, 2010 AND 2009

The Company records as pension plan assets in the statement of financial position amounting to ￦136,085 million ($120,344

thousand) that was placed to reserve in Samsung Life Insurance Co., Ltd. and Samsung Securities Co., Ltd. In addition, provision

for the year amounted to ￦34,294 million ($30,327 thousand), net of defined contribution retirement pension plan amounting to

￦610 million ($539 thousand), and ￦1,801 million ($1,593 thousand) in selling and general operating expenses and investment

administrative expenses, respectively.

Retirement pension plan assets as of March 31, 2010 and 2009 are as follows:

23. INCOME TAX:

(1) The components of income tax expense for the years ended March 31, 2010 and 2009 are summarized follows:

(*) Tax effect on changes in cumulative temporary differences

Korean Won / In millions

Income tax to be paid ￦131,256 ￦237,544 $ 116,073 $ 210,067

Tax effect on changes in cumulative temporary differences(*) 33,001 (15,023) 29,184 (13,285)

Income tax due to gains on sale of treasury stock (562) (424) (497) (375)

Income tax ￦163,695 ￦222,097 $ 144,760 $ 196,407

Translation into U.S. Dollars (Note 2)/ In thousands

Korean Won / In millions

Beginning balance ￦ (25,079) ￦ (40,103) $ (22,178) $ (35,464)

Changes due to tax reconciliation (82) 1 (72) 1

Ending balance (58,162) (25,079) (51,434) (22,178)

Tax effect on changes in cumulative temporary differences ￦33,001 ￦ (15,023) $29,184 $ (13,285)

Translation into U.S. Dollars (Note 2)/ In thousands

Korean Won / In millions

Cash and bank deposits ￦60,833 ￦91,975 $ 53,796 $ 81,336

Investment securities 67,939 23,661 60,081 20,924

Loans - 2,305 - 2,039

Other assets 7,313 3,398 6,467 3,005

￦136,085 ￦121,339 $ 120,344 $ 107,304

Translation into U.S. Dollars (Note 2)/ In thousands

Description

Samsung Fire & Marine InsuranceAnnual Report 2009

20102010 20092009

(2) An explanation of the relationship between income tax expense and accounting income before income tax expense for the years

ended December 31, 2010 and 2009 is as follows:

Korean Won / In millions

Income before income tax ￦688,205 ￦820,805 $ 608,600 $ 725,862

Tax effect at the rate of 24.2% 166,521 225,690 147,259 199,584

Adjustment:

Non-taxable income (1,564) (1,510) (1,383) (1,335)

Non-deductible expenses 4,565 1,932 4,037 1,708

Tax credit (98) (160) (87) (141)

Other (5,729) (3,855) (5,066) (3,409)

Income tax expense ￦163,695 ￦222,097 $144,760 $196,407

Effective tax rate (income tax expense/pretax income) 23.79% 27.06% 23.79% 27.06%

Translation into U.S. Dollars (Note 2)/ In thousands

(3) Income tax and deferred income tax assets (liabilities) directly adjusted to capital as of March 31, 2010 are summarized as

follows:

(4) Changes in significant cumulative temporary differences and deferred income tax assets (liabilities) are as follows:

Korean Won / In millions

Income tax due to gains on sale of treasury stock ￦2,321 ￦ (562) ￦ 1,759

Gain on valuation of available-for-sale securities 2,121,785 (469,444) 1,652,341

Changes in equity arising from

application of the equity method 8,577 (1,887) 6,690

Negative changes in equity arising from

application of the equity method (5,097) 1,117 (3,980)

Gain on valuation of derivatives (45,107) 9,815 (35,292)

Accumulated other comprehensive

income arising from separate account 7,357 - 7,357

￦2,089,836 ￦ (460,961) ￦1,628,875

Translation into

U.S. Dollars (In thousands) (Note 2) $ 1,848,104 $ (407,641) $ 1,440,463

After adjustmentDeferred income tax

assets (liabilities)Before adjustment

Cumulative temporary differences

Temporary difference, net ￦ (146,834) ￦ (148,500) ￦ (295,334) ￦ (25,079) ￦ (33,083) ￦ (58,162)

Capital adjustment (1,181,262) (906,253) (2,087,515) (259,979) (200,420) (460,399)

￦(1,328,096) ￦ (1,054,753) ￦ (2,382,849) ￦ (285,058) ￦ (233,503) ￦ (518,561)

Translation into

U.S. Dollars (In thousands) (Note 2) $(1,174,475) $ (932,749) $ (2,107,224) $ (252,085) $ (206,494) $ (458,579)

Deferred income tax assets (liabilities)

2009 2010Increase(decrease)

2009 2010Increase(decrease)

Description

Description

Description

102 103Financial Section Financial Statements

20102010 20092009

20102010 20092009

NOTES TO FINANCIAL STATEMENTSFOR THE YEARS ENDED MARCH 31, 2010 AND 2009

(5) Prepaid income tax (payables) before offset as of March 31, 2010 and 2009 are as follows:

Korean Won / In millions

Prepaid tax before offset ￦101,029 ￦61,390 $ 89,343 $ 54,289

Income tax payable before offset 132,191 237,153 116,901 209,722

Income tax payable ￦31,162 ￦175,763 $ 27,558 $ 155,433

Translation into U.S. Dollars (Note 2)/ In thousands

24. SHAREHOLDERS’ EQUITY:

(1) Capital stock as of March 31, 2010 is as follows (Unit: Won):

Preferred shareholders have no voting rights but may receive accumulative dividends and liquidation proceeds. Preferred

shareholders normally receive additional cash dividends of 1% on par value. Upon liquidation, preferred shareholders are entitled to

receive liquidation proceeds prior to the common shareholders. The Company allows the retirement of the stocks within the amount

of dividend based on the decision of the board of directors in accordance with related law. Accordingly, the Company retired the

treasury stock of the 730,000 shares of common stock and 50,000 shares of preferred stock on November 11, 2003 based on

the decision of the board of directors on September 5, 2003. Also, the Company retired treasury stock of the 1,500,000 shares of

common stock and 100,000 shares of preferred stock on May 28, 2007 based on the decision of the board of directors on April

18, 2007. As a result, the difference occurs between the amount of the value per share multiplied by the number of issued stocks

and the capital stock as of March 31, 2010.

(2) Capital surplus

Capital surplus as of March 31, 2010 and 2009 is summarized as follows:

Description

Number of the authorized shares

Value per share

Number of the issued stock

-Common shares

-Preferred shares

100,000,000

￦500

47,374,837

3,192,000

Korean Won / In millions

Additional paid-in capital ￦593,429 ￦593,429 $ 524,787 $ 524,787

Asset revaluation surplus 132,209 132,209 116,916 116,916

Other capital surplus 10,988 9,229 9,717 8,161

￦736,626 ￦734,867 $ 651,420 $ 649,864

Translation into U.S. Dollars (Note 2)/ In thousands

Samsung Fire & Marine InsuranceAnnual Report 2009

(3) Revaluation surplus

The Company revalued its property on January 1, 1999 in accordance with the Assets Revaluation Law. Details of the asset

revaluation and revaluation surplus are summarized as follows (Unit: Won in millions, dollars in thousands):

Net book value Revalued amount Revaluation surplus

Land ￦172,180 $ 152,264 ￦262,061 $ 231,748 ￦89,881 $ 79,484

Buildings 289,443 255,963 333,410 294,844 43,967 38,881

Structures 345 305 545 482 200 177

￦461,968 $ 408,532 ￦596,016 $ 527,074 ￦134,048 $ 118,542

Korean Won U.S. dollars Korean Won U.S. dollars Korean Won U.S. dollars

The movements in the revaluation surplus for the period from January 1, 1999 to March 31, 2010 are summarized as follows:

(4) Legal reserve

Legal reserve as of March 31, 2010 is ￦13,237 million ($11,706 thousand). The Korean Commercial requires the Company to

appropriate as legal reserve an amount equal to at least 10% of the cash dividends each accounting period until the reserve equals

50% of stated capital. The legal reserve may be used to reduce deficit or it may be transferred to stated capital by a shareholders’

resolution.

(5) Voluntary reserve

Voluntary reserve as of March 31, 2010 amounts to £‹2,102,159 million ($1,859,002 thousand), as approved at the general

meeting of shareholders, and ￦1,852 million ($1,638 thousand) reclassified from reserve for business rationalization, as required

previously in the Korean Corporate Tax Law.

25. TREASURY STOCK:

Treasury stock as of March 31, 2010 and 2009 is summarized as follows:

As of March 31, 2010 and 2009, acquisition cost of treasury stock is ￦95,620 million ($84,560 thousand) and ￦97,178 million

($85,938 thousand), respectively. The Company holds its treasury stock for price stabilization and for exercise of stock options.

Gains on reissue of treasury stock are recorded as other capital surplus. As of March 31, 2010, gains on reissue of treasury stock

amount to￦10,988 million ($9,717 thousand).

Korean Won / In millions

Asset revaluation surplus carried forward

before January 1, 1999 ￦1,506 $ 1,332

Asset revaluation surplus on January 1, 1999 134,048 118,542

Revaluation taxes (3,345) (2,958)

Revaluation surplus as of March 31, 2010 ￦132,209 $ 116,916

Translation into U.S. Dollars (Note 2)/ In thousands

Korean Won / In millions

April 1, 2009 3,773,076 300,780 ￦ 97,178 $ 85,938

Exercise of stock option

(62,878) - (1,558) (1,378)

March 31, 2010 3,710,198 300,780 ￦ 95,620 $ 84,560

Translation into U.S. Dollars (Note 2)/ In thousands

Amount Amount

Number of shares

Common stock Preferred stock

104 105Financial Section Financial Statements

20102010 20092009

NOTES TO FINANCIAL STATEMENTSFOR THE YEARS ENDED MARCH 31, 2010 AND 2009

26. COMPREHENSIVE INCOME STATEMENTS:

The comprehensive income statements for the years ended March 31, 2010 and 2009 are summarized as follows:

27. STOCK OPTIONS:

The Company granted stock options to certain employees according to a resolution at the shareholders’ meeting and the board of

directors’ meeting. Details of the stock options are summarized as follows (Unit: Won):

Korean Won / In millions

Net income ￦524,510 ￦598,708 $ 463,840 $ 529,455

Other comprehensive income (loss):

Gain on valuation of available-for-sale securities 556,334 103,614 491,983 91,629

Changes in equity arising from application of the equity method (12,806) 19,009 (11,325) 16,810

Negative changes in equity arising from application of

the equity method (838) (472) (741) (417)

Gain (loss) on overseas operation translation (*) (15,465) 21,489 (13,676) 19,004

Gain (loss) on valuation of cash flow hedge derivatives 157,521 (158,718) 139,300 (140,360)

Accumulated other comprehensive income arising from

separate account 5,623 1,650 4,973 1,459

Comprehensive income ￦1,214,879 ￦585,280 $ 1,074,354 $ 517,580

Translation into U.S. Dollars (Note 2)/ In thousands

Number of shares granted 18,166 67,757 3,438 17,604 21,587

Stock Common stock Common stock Common stock Common stock Common stock

Exercise price ￦23,800 ￦38,900 ￦82,500 ￦62,600 ￦74,900

Exercisable period May 31, 2003 Sep 7, 2003 May 31, 2004 Jun 12, 2005 May 29, 2006

~May 30, 2010 ~Sep 6, 2011 ~May 30, 2012 ~Jun 11, 2013 ~May 28, 2014

Service period 3 years 2 years 2 years 2 years 2 years

(*) For presentation in the accompanying financial statements, assets and liabilities in financial statements of the overseas branch are translated into Korean Won at the

current exchange rate, shareholders’ equity at historical exchange rate and income and expense at the weighted average exchange rate for the year. Translation gains of

￦421 million ($372 thousand) resulting from the translation of financial statements of the overseas branch are recorded in loss on overseas operation translation as

accumulated other comprehensive loss.

May 30, 2000 Sep 6, 2001 May 30, 2002 Jun 11, 2003 May 28, 2004

The Company estimated compensation cost associated with the stock options using Black-Scholes Model. Details of assumptions

used are summarized as follows:

Risk free rate 9.22% 5.39% 6.57% 4.14% 4.54%

Expected excisable period 5 years 5 years 5 years 5 years 5 years

Expected volatility of stock price 65.47% 66.24% 66.30% 59.78% 52.68%

Expected dividend rate 1.05% 1.30% 1.22% 1.57% 1.35%

Expected rate of rights expiration 0.00% 0.00% 0.00% 0.00% 0.00%

May 30, 2000 Sep 6, 2001 May 30, 2002 Jun 11, 2003 May 28, 2004

Samsung Fire & Marine InsuranceAnnual Report 2009

20102010 20092009

Details on the compensation cost for stock options are summarized as follows:

28. DIVIDENDS:

The Company has proposed to appropriate retained earnings for cash dividends as follows:

Valuation amount for stock options ￦4,536 ￦6,818 ￦741 ￦1,286 ￦1,342

Accumulated decrease of stock

options for exercise, cancellation,

change and others 4,278 5,388 582 734 618

Compensation costs for the year

ended March 31, 2010 - - - - -

Residual of stock options 258 1,430 159 552 724

Additional compensation costs to be incurred - - - - -

Translation into U.S. Dollars (In thousands) (Note 2) $- $ - $ - $ - $-

May 30, 2000 Sep 6, 2001 May 30, 2002 Jun 11, 2003 May 28, 2004

Korean Won / In millions

Common stock ￦130,994 ￦130,805 $ 115,842 $ 115,676

Preferred stock 8,688 8,688 7,683 7,683

￦139,682 ￦139,493 $ 123,525 $ 123,359

Net income ￦524,510 ￦598,708 $ 463,840 $ 529,455

Dividends as a percentage of net income 26.63% 23.30% 26.63% 23.30%

Translation into U.S. Dollars (Note 2)/ In thousands

29. TRANSACTIONS AND BALANCES WITH RELATED PARTIES:

(1) The Company is the ultimate holding company and its subsidiaries as of March 31, 2010 are as follows (Unit: Won in millions,

dollars in thousands):

P.T Asuransi Samsung Tugu 10,500 70.0 ￦5,373 ($4,752) Insurance Indonesia

Samsung Fire & Marine

Insurance of China Limited (*) - 100.0 35,497 ($31,391) Insurance China

Samsung Vina Insurance (*) - 50.0 21,720 ($19,208) Insurance Vietnam

(*) Shares are not presented since it is stock without par value.

SharesOwnership

ratio (%)Shareholder’s

equityBusiness LocationSubsidiaries

106 107Financial Section Financial Statements

20102010 20092009

20102010 20092009

20102010 20092009

NOTES TO FINANCIAL STATEMENTSFOR THE YEARS ENDED MARCH 31, 2010 AND 2009

Other related parties are Samsung Fire & Marine Insurance Claim Adjustment Service and others.

(2) Major balances and significant transactions with affiliates as of and for the years ended March 31, 2010 and 2009 are as

follows:

(3) Major balances and significant transactions with the company accounted for using the equity method as of and for the years

ended March 31, 2010 and 2009 are as follows:

Korean Won / In millions

Revenues and expenses:

Premiums income ￦5,338 ￦6,590 $ 4,721 $ 5,828

Claims paid 2,967 2,520 2,624 2,229

Receivables and payables:

Insurance receivables 2,174 1,751 1,923 1,548

Insurance payables 1,156 189 1,022 167

Translation into U.S. Dollars (Note 2)/ In thousands

Korean Won / In millions

Revenues and expenses:

Investigation expense for claim paid ￦129,898 ￦107,961 $ 114,873 $ 95,473

Receivables and payables:

Loans 20,327 34,951 17,976 30,908

Translation into U.S. Dollars (Note 2)/ In thousands

(4) The compensations for the key management of the Company for the year ended March 31, 2009 are as follows

Korean Won / In millions

Short-term salaries ￦1,767 $ 1,563

Long-term salaries 3,210 2,839

Provision for severance indemnities 261 231

Translation into U.S. Dollars (Note 2)/ In thousands

Description AmountAmount

30. EARNINGS PER COMMON SHARE:

(1) Earnings per common share for the years ended March 31, 2010 and 2009 is calculated as follows:

Korean Won / In millions

Net income ￦524,510 ￦598,708 $ 463,840 $ 529,455

Dividends on preferred stock (8,688) (8,688) (7,683) (7,683)

Earnings available for common stock 515,822 590,020 456,157 521,772

Weighted-average number of shares of common stock 43,629,597 43,568,042 43,629,597 43,568,042

Earnings per common share (Won, U.S. dollars) ￦11,823 ￦13,542 $ 10.46 $11.98

Translation into U.S. Dollars (Note 2)/ In thousands

Samsung Fire & Marine InsuranceAnnual Report 2009

20102010 20092009

31. COMMITMENTS AND CONTINGENCIES:

(1) Promissory Note

As of March 31, 2010, the Company has provided Korea Exchange Bank and others with 3 promissory notes with total face value

amounting to￦647 million ($572 thousand), as collateral for rental deposits.

(2) Reinsurance Contract

Non-life insurance companies (including the Company) assume and cede certain portions of the total insurance premium with

Korean Reinsurance Company and the remaining portion is covered by foreign reinsures. The Company utilizes reinsurance

arrangements to limit its maximum loss, to provide greater diversification of risks and to minimize exposure to large risks.

(3) Bank Overdraft Agreement

As of March 31, 2010, the Company has bank overdraft agreements with Standard Chartered First Bank Korea and other

banks up to ￦470,000 million ($415,635 thousand), including agreements for separate account up to ￦30,000 million

($26,530 thousand).

(4) Guarantee Insurance

As of March 31, 2010, the Company entered into guarantee agreements with Seoul Guarantee Insurance Co., Ltd. for guarantee

limits of￦20,286 million ($17,940 thousand).

(5) Lawsuits

The Company is a defendant in 1,840 lawsuits for insurance claims aggregating ￦173,980 million ($153,856 thousand). The

Company has set up a policy reserve for estimated losses amounting to ￦130,215 million ($115,153 thousand) in relation to the

above lawsuits as policy reserves.

2) Diluted net income per common share for the years ended March 31, 2010 and 2009 is calculated as follows:

Diluted net income per common share is computed by dividing the diluted net income for the years ended March 31, 2010 and

2009 by the weighted-average number of diluted shares plus common shares, assuming all stock options are exercised at the

beginning.

Korean Won / In millions

Earnings available for common stock ￦515,822 ￦590,020 $ 456,157 $ 521,772

Compensation cost, net of tax - - - -

Diluted net income 515,822 590,020 456,157 521,772

Weighted-average number of diluted share 43,755,390 43,742,783 43,755,390 43,742,7831

Diluted net income per common share (Won, U.S. dollars) ￦11,789 ￦13,488 $10.43 $ 11.93

Translation into U.S. Dollars (Note 2)/ In thousands

108 109Financial Section Financial Statements

NOTES TO FINANCIAL STATEMENTSFOR THE YEARS ENDED MARCH 31, 2010 AND 2009

(6) Derivatives Instruments

As of March 31, 2010, the Company entered into contracts of financial derivative instruments as follows (Unit: Won in millions,

dollars in thousands):

In connection with the financial derivative instruments, the Company recognized gain and loss on valuation amounting to ￦2,658

million ($2,350 thousand) and ￦1,641 million ($1,451 thousand), respectively, for the year ended March 31, 2010. In addition, loss

on valuation of the financial derivative instruments amounting to ￦45,107 million ($39,889 thousand), the amount before income tax

directly deducted from accumulated other comprehensive loss, is accounted for and reflected as accumulated other comprehensive

loss as of March 31, 2010.

(7) Credit Linked Notes

Credit linked notes as of March 31, 2010 are as follows (Unit: Won in millions, dollars in thousands):

The Company has credit-linked notes amounting to ￦124,388 million ($110,000 thousand) at face value. The Company takes the

risk to undertake goods or pay cash equivalent to Reference Obligation on demand of a person related to the transaction in case

credit event on Reference Obligation occurs.

(8) Other Compound Financial Instruments

The Company has interest rate-linked structured notes amounting to ￦270,000 million ($238,769 thousand) at face value and

￦277,794 million ($245,661 thousand) at fair value. According to the fluctuation of market interest rate, the issuers of structured

notes could repay early and the interest rate that the Company receives could change. In addition, the Company has bonds given

the advanced redemption right amounting to ￦33,924 million($30,000 thousand) at face value and ￦35,727 million ($31,594

thousand) at fair value.

Abn Amro Ftd CLN 6.12 $ 20,000 ￦22,849 2006-10-26 2016-12-20

JPMorgan Corsair CLN LIB03USD+0.88 20,000 21,951 2007-07-19 2014-06-09

Leveraged ROK CLN LIB03USD+0.67 20,000 21,102 2007-01-24 2017-03-20

Leveraged ROK CLN070913 LIB03USD+1.10 20,000 21,519 2007-09-13 2017-09-20

Merit Holdings Ltd SCB CLN LIB03USD+0.88 10,000 10,434 2007-07-30 2014-09-20

WSCB Ftd CLN 5.55 20,000 23,286 2006-10-10 2011-12-20

$ 110,000 ￦121,141

Interest rate(%) Nominal price Book value Acquisition date Maturity date

Total

Foreign currency Forward ￦59,941 $ 53,008 ￦13,888 $12,282 ￦46,053 $ 40,726

Foreign currency swap 1,893,127 1,674,148 - - 1,893,127 1,674,148

Interest rate swap 270,000 238,769 270,000 238,769 - -

￦2,223,068 $ 1,965,925 ￦283,888 $ 251,051 ￦1,939,180 $ 1,714,874

TotalTotal

Korean WonTranslation Into

U.S. Dollars (Note 2) Korean WonTranslation Into

U.S. Dollars (Note 2) Korean WonTranslation Into

U.S. Dollars (Note 2)

Description

Samsung Fire & Marine InsuranceAnnual Report 2009

20102010 20092009

20102010 20092009

32. SEPARATE ACCOUNT:

The Company has recorded corporate retirement insurance and corporate pension insurance as a separate account independently

from ordinary accounts in accordance with Insurance Supervisory Regulation as established by the Financial Supervisory Commission

of the Republic of Korea. Separate account is stated at fair value and the Company properly presents the financial status and

operating results of the separate account.

The financial statements of the separate account of corporate retirement insurance as of and for the years ended March 31, 2010

and 2009 are as follows:

Korean Won / In millions

Separate account assets:

Cash and deposits ￦198,236 ￦364,617 $ 175,306 $ 322,442

Securities

387,978 328,826 343,101 290,790

Loans - 25,390 - 22,453

Others 5,696 9,352 5,037 8,2705

Due from ordinary account 6,950 13,490 6,146 11,930

￦598,860 ￦741,675 $ 529,590 $ 655,885

Separate account liabilities:

Policy reserves ￦574,816 ￦712,601 $ 508,327 $ 630,174

Others 2,622 12,104 2,319 10,704

Accumulated other comprehensive income 194 - 172 -

Due to ordinary account 21,228 16,970 18,772 15,007

￦598,860 ￦741,675 $ 529,590 $ 655,885

Translation into U.S. Dollars (Note 2)/ In thousands

Statements of financial position

Korean Won / In millions

Separate account assets:

Premiums earned ￦141,088 ￦179,630 $ 124,768 $158,852

Interest income 32,473 43,668 28,717 38,617

Others 7,990 8,672 7,066 7,669

￦181,551 ￦231,970 $ 160,551 $ 205,138

Separate account expenses:

Provision for policy reserves ￦ (137,786) ￦ (101,014) $ (121,848) $ (89,330)

Claims paid 309,616 322,136 273,803 284,875

Others 9,721 10,848 8,596 9,593

￦181,551 ￦231,970 $ 160,551 $ 205,138

Translation into U.S. Dollars (Note 2)/ In thousands

Statements of income

110 111Financial Section Financial Statements

20102010 20092009

20102010 20092009

The financial statements of the separate account of corporate pension insurance as of and for the years ended March 31, 2010

and 2009 are as follows:

Korean Won / In millions

Separate account assets:

Cash and deposits ￦48,319 ￦168,040 $42,730 $ 148,603

Securities 472,034 135,241 417,434 119,597

Loans - 9,950 - 8,799

Others ￦6,316 ￦5,941 $ 5,585 $ 5,254

Due from ordinary account 27,310 36,648 24,151 32,409

￦553,979 ￦355,820 $ 489,900 $ 314,662

Separate account liabilities:

Policy reserves ￦527,857 ￦317,281 $ 466,800 $ 280,581

Others 18,069 22,399 15,979 19,808

Accumulated other comprehensive income 7,163 1,734 6,334 1,533

Due to ordinary account 890 14,406 787 12,740

￦553,979 ￦355,820 $ 489,900 $ 314,662

Translation into U.S. Dollars (Note 2)/ In thousands

Statements of financial position

Korean Won / In millions

Separate account income:

Premiums earned ￦431,063 198,376 $ 381,202 $ 175,430

Interest income 20,784 14,921 18,380 13,195

Others 6,608 1,449 5,843 1,281

￦458,455 ￦214,746 $ 405,425 $ 189,906

Separate account expenses:

Provision for policy reserves ￦210,576 ￦145,638 $ 186,218 $ 128,792

Claims paid 238,696 65,074 211,086 57,547

Others 9,183 4,034 8,121 3,567

￦458,455 ￦214,746 $ 405,425 $ 189,906

Translation into U.S. Dollars (Note 2)/ In thousands

Statements of income

NOTES TO FINANCIAL STATEMENTSFOR THE YEARS ENDED MARCH 31, 2010 AND 2009

Samsung Fire & Marine InsuranceAnnual Report 2009

20102010 20092009

20102010 20092009

33. SELLING AND GENERAL OPERATING EXPENSES:

Selling and general operating expenses for the years ended March 31, 2010 and 2009 are as follows:

34. OTHER ASSETS AND OTHER LIABILITIES:

(1) Other assets as of March 31, 2010 and 2009 are summarized as follows:

Korean Won / In millions

Salaries ￦414,705 ￦383,521 $ 366,736 $ 339,159

Provision for severance indemnities 44,586 36,143 39,429 3 1,962

Other employee benefits 88,057 58,007 77,871 51,297

Taxes and due 57,789 60,355 51,105 53,374

Rent 67,234 61,077 59,457 54,012

Depreciation 44,053 47,860 38,957 42,324

Amortization 30,682 32,916 27,133 29,109

Commissions 99,249 81,303 87,769 71,899

Advertising 58,273 48,458 51,533 42,853

Computer related expenses 44,765 54,032 39,587 47,782

Deferred acquisition cost & collection cost 223,644 224,119 197,775 198,195

Agency fee 299,615 296,636 264,958 262,324

Investigation expense for claim paid 177,999 164,175 157,410 145,185

Others 145,852 142,347 128,981 125,882

￦1,796,503 ￦1,690,949 $ 1,588,701 $ 1,495,357

Translation into U.S. Dollars (Note 2)/ In thousands

Korean Won / In millions

Development costs and other intangible assets ￦74,671 ￦82,484 $ 66,033 $ 72,943

Other account receivables 146,169 121,115 129,262 107,106

Prepaid expenses 10,456 10,587 9,246 9,362

Advanced payments 8,232 4,881 7,280 4,316

Note receivables 1,957 2,496 1,731 2,207

Prepaid value added tax 687 778 607 688

Securities deposit 2,856 3,131 2,526 2,769

Financial derivative assets 80,825 22,020 71,476 19,473

Others 1,136 1,242 1,005 1,098

Allowance for doubtful accounts (2,977) (2,759) (2,633) (2,440)

￦324,012 ￦245,975 $ 286,533 $ 217,522

Translation into U.S. Dollars (Note 2)/ In thousands

112 113Financial Section Financial Statements

20102010 20092009

NOTES TO FINANCIAL STATEMENTSFOR THE YEARS ENDED MARCH 31, 2010 AND 2009

Korean Won / In millions

Other account payables ￦18,773 ￦19,075 $ 16,601 $ 16,869

Accrued severance indemnities 58,252 52,321 51,514 46,269

Premiums received in suspense 1,185 412 1,048 364

Note payables 366 610 324 539

Advanced receipts 24,247 23,326 21,442 20,628

Withholdings 8,423 7,683 7,449 6,794

Unearned income 503 592 445 524

Accrued value added tax 1,211 1,113 1,071 984

Financial derivatives liabilities 122,887 280,590 108,673 248,134

Other 21,735 28,957 19,220 25,608

￦257,582 ￦414,679 ￦227,787 $ 366,713

Translation into U.S. Dollars (Note 2)/ In thousands

Samsung Fire & Marine InsuranceAnnual Report 2009

(2) Other liabilities as of March 31, 2010 and 2009 are summarized as follows:

35. EMPLOYEES’ WELFARE AND DONATIONS:

(1) Supporting educational expenses

In order to mitigate the burden of the educational expenses of employees’ children, the Company supports portion of tuition of pre-

school, and entrance fee and tuition of middle school to college.

(2) Medical examination

The Company provides regular annual medical examination service for its employees.

(3) Others

The Company executes paid vacation, such as congratulations and condolences vacation, long service vacations and vacation for

training.

(4) Donation to the public

The Company donated to college development funds and others amounting to￦15,760 million ($13,937 thousand) and￦15,147

million ($13,395 thousand) for the years ended March 31, 2010 and 2009, respectively.

20102010 20092009

20102010 20092009

36. VALUE-ADDED:

Information needed for calculation of value-added for the years ended March 31, 2010 and 2009 is as follows:

37. STATEMENTS OF CASH FLOWS:

Significant transactions with no effects to the cash flows for the years ended March 31, 2010 and 2009 are as follows:

Korean Won / In millions

Transfer from construction inprogress to land ￦10 ￦ 62,100 $ 9 $ 7

Transfer from construction inprogress to buildings 15,614 86,709 13,808 76,679

Transfer from construction inprogress to structures 259 - 229 -

Transfer from prepaid accounts to intangible assets 16,600 26,582 14,680 23,507

Transfer from available-for-sale securities to securities

accounted for using the equity method - 3,570 - 3,157

Translation into U.S. Dollars (Note 2)/ In thousands

Korean Won / In millions

Salaries ￦430,243 ￦395,447 $ 380,477 $ 349,706

Provision for severance indemnities 46,475 36,535 41,099 32,309

Employee benefits 90,578 59,344 80,101 52,480

Taxes and dues 98,380 99,252 87,000 87,771

Rental expenses 67,234 61,084 59,457 54,018

Depreciation 53,338 56,060 47,168 49,576

Total ￦786,248 ￦707,722 $ 695,302 $ 625,860

Translation into U.S. Dollars (Note 2)/ In thousands

114 115Financial Section Financial Statements

NOTES TO FINANCIAL STATEMENTSFOR THE YEARS ENDED MARCH 31, 2010 AND 2009

(3) The calculation and accounting principle of reserve for claims by type of insurance contract, anticipated interest rate and

premium surplus (premium deficiency) as of March 31, 2010 are summarized as follows:

Long-term with dividend ￦374 2.50~6.50% ￦92

Long-term without dividend 90,610 3.25~8.00% 25,281

Individual pension 34,159 2.50~7.50% 5,522

Total 125,142 30,895

(Fixed interest rate) 40,818 2,174

(Floating interest rate) 84,325 28,721

Korean Won / In millions

Anticipated interest rate(*)Reserve for claims Premium surplus(deficiency)Description

(*) The anticipated interest rate is based on a guaranteed portion.

38. PREMIUM DEFICIENCY:

(1) The objects of insurance contracts for calculating premium deficiency

Based on valid insurance contracts as of December 31, 2009, the Company included the individual pension insurance products

and long-term insurance against loss products with fixed interest rate and floating interest rate in calculating premium deficiency. In

addition, general insurance against loss and retirement insurance with less than one year insurance term were excluded.

(2) The basis of calculating premium deficiency is as follows

① Discount rate : The discount rate is 5.35% (Rate of return on assets management for recent 3years from April 1, 2007 to March 31,

2010).

② Rate of operating expenses : The rate of operating expenses is 88.6% (Ratio of actual operating expenses to anticipated operating

expenses for recent 1 year from March 1, 2009 to February 28, 2010).

③ Rate of claim payment : The rate of claim payment is 73.4% (Ratio of claim payment to the anticipated risk of the insurer for recent 3

years from January 1, 2007 to December 31, 2009).

④ Rate of maintenance : The rate of maintenance is as follows (Ratio of maintenance to the number of contracts for recent 3 years from

January 1, 2007 to December 31, 2009):

Rate of changing on condition was reflected by 4 types of ratio and the rate of maintenance caused by reflection is as follows:

Long-term with dividend 90.60% 77.60% 64.80% 54.50% 45.90%

Long-term without dividend 78.30% 62.10% 52.10% 47.10% 43.00%

Individual pension 84.60% 74.40% 67.70% 62.70% 58.10%

Total 78.70% 62.80% 52.90% 47.70% 43.50%

13th 25th 37th 49th 61thDescription

Samsung Fire & Marine InsuranceAnnual Report 2009

39. MAJOR INDICATORS FOR THE FINAL INTERIM PERIOD:

The major indicators of management performance for the final interim period (unaudited) are as follows (Unit: Won in millions, dollars

in thousands, except net income per share):

40. K-IFRS ADOPTION PLAN AND IMPLEMENTATION:

In accordance with the Roadmap for IFRS Adoption announced in March 2007, the Company is required to present financial

statements prepared in accordance with K-IFRS starting from 2011. For transition toward KIFRS, the Company is currently working

on the project of K-IFRS adoption by selecting an external consulting company and system builder and organizing taskforce team.

The project is classified into 3 steps. The Company has begun the project in November 2008 and completed steps 1 and 2 and is

currently carrying out step 3. The taskforce team regularly reports the progress of K-IFRS adoption and related issues to the

management.

The details on each phase of the project are as follows:

The expected differences on financial information of the Company between the current accounting process and the adoption of K-

IFRS are scope of the consolidated, allowance for bad debts, revenue recognition, classification and measuring of financial

instruments, employee benefits, and others.

Korean Won / In millions

Operating revenues ￦ 3,390,273 ￦2,956,683 $ 2,998,119 $ 2,614,682

Operating expenses 3,242,189 2,748,551 2,867,164 2,430,625

Operating income 148,084 208,132 130,955 184,057

Other income 9,474 12,447 8,378 11,007

Other expenses 2,982 5,291 2,637 4,679

Net income 121,588 164,664 107,524 145,617

Net income per common share 2,736 3,728 2.42 3.30

Translation into U.S. Dollars (Note 2)/ In thousands

2010, 4Q2010, 4Q 2009, 4Q2009, 4Q

Phase 1 Planning for K-IFRS adoption and analyzing differences between current accounting and K-IFRS

Phase 2 Amending the Company’s accounting standards in accordance with K-IFRS and designing and

developing system through definition of task conditions

Phase 3 Applying both current accounting and K-IFRS and resolving issues which could happen

Details

Description

116 117Financial Section Financial Statements

INTERNAL ACCOUNTING CONTROL SYSTEM (“IACS”)REVIEW REPORTENGLISH TRANSLATION OF A REPORT ORIGINALLY ISSUED IN KOREAN

To the Representative Director ofSamsung Fire & Marine Insurance Co., Ltd.:

We have reviewed the accompanying Report on the Management’s Assessment of IACS (the “Management’s Report”) of Samsung Fire &

Marine Insurance Co., Ltd. Company (the “Company”) as of March 31, 2010. The Management’s Report, and the design and operation of

IACS are the responsibility of the Company’s management.

Our responsibility is to review the Management’s Report and issue a review report based on our procedures. The Company’s management

stated in the accompanying Management’s Report that “based on the assessment of the IACS as of March 31, 2010, the Company’s IACS

has been appropriately designed and is operating effectively as of March 31, 2010, in all material respects, in accordance with the IACS

Framework established by the Korea Listed Companies Association.”

We conducted our review in accordance with the IACS Review Standards established by the Korean Institute of Certified Public

Accountants. Those standards require that we plan and perform a review, objective of which is to obtain a lower level of assurance than an

audit, of the Management’s Report in all material respects. A review includes obtaining an understanding of a company’s IACS and making

inquiries regarding the Management’s Report and, when deemed necessary, performing a limited inspection of underlying documents and

other limited procedures.

The Company’s IACS represents internal accounting policies and a system to manage and operate such policies to provide reasonable

assurance regarding the reliability of financial statements prepared, in accordance with accounting principles generally accepted in the

Republic of Korea, for the purpose of preparing and disclosing reliable accounting information. Because of its inherent limitations, IACS may

not prevent or detect a material misstatement of the financial statements. Also, projections of any evaluation of effectiveness of IACS to future

periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance

with the policies or procedures may deteriorate.

Based on our review, nothing has come to our attention that causes us to believe that the Management’s Report referred to above is not

fairly stated, in all material respects, in accordance with the IACS Framework established by the Korea Listed Companies Association.

Our review is based on the Company’s IACS as of March 31, 2010 and we did not review its IACS subsequent to March 31, 2010. This

report has been prepared pursuant to the Acts on External Audit for Stock Companies in the Republic of Korea and may not be appropriate

for other purposes or for other users.

May 20, 20010

Deloitte Anjin LLC14Fl., Hanwha Securities Bldg., 23-5 Yoido-dong,

Youngdeungpo-gu, Seoul 150-717, Korea

Tel:+82.2.6676 1000, 1114 Fax:+82.2.6674 2114www.deloitteanjin.co.kr

Notice to ReadersThis report is annexed in relation to the audit of the financial statements as of March 31, 2010 and the review of internal accounting control system pursuant to Article

2-3 of the Act on External Audit for Stock Companies of the Republic of Korea.

Deloitte refers to one or more of Deloitte Touche Tohmatsu, a Swiss Verein, and its network of member firms, each of which is a legally separate and independent entity.Please see www.deloitte.com/kr/about for a detailed description of the legal structure of Deloitte Touche Tohmatsu and its member firms.

Member of Deloitte Touche Tohmatsu

Samsung Fire & Marine InsuranceAnnual Report 2009

REPORT ON THE ASSESSMENT OFINTERNAL ACCOUNTING CONTROL SYSTEM (“IACS”)ENGLISH TRANSLATION OF A REPORT ORIGINALLY ISSUED IN KOREAN

To the Board of Directors and Auditor (Audit Committee) ofSamsung Fire & Marine Insurance Co., Ltd.:

I, as the Internal Accounting Control Officer (“IACO”) of Samsung Fire & Marine Insurance Co., Ltd. (“the Company”), assessed the status of

the design and operation of the Company’s IACS for the year ended March 31, 2010.

The Company’s management including IACO is responsible for designing and operating IACS. I, as the IACO, assessed whether the IACS

has been appropriately designed and is effectively operating to prevent and detect any error or fraud which may cause any misstatement of

the financial statements, for the purpose of preparing and disclosing reliable financial statements. I, as the IACO, applied the IACS standard

for the assessment of design and operations of the IACS.

Based on the assessment of the IACS, the Company’s IACS has been appropriately designed and is operating effectively as of March 31,

2010, in all material respects, in accordance with the IACS Framework.

May 3, 2010

Lee Jong Seong, Internal Accounting Control Officer

Chi Dae Sub, Chief Executive Officer

118 119Financial Section Financial Statements

WORLDWIDE NETWORK

IndonesiaP.T. ASURANSI SAMSUNG TUGUPlaza Dm Bldg. 23rd Floor, Suite # 2301 Jl. Jend. Sudirman Kav.25 Jakarta Selatan Indonesia - 12920Telephone : 62-21-520-5511 Facsimile : 62-21-520-5522

VietnamSAMSUNG VINA INSURANCE CO., LTD.9th Floor, Diamond Plaza Bldg., 34 Le Duan St., Dist 1, Ho Chi Minh, VietnamTelephone : 84-8-3823-7812~3 Facsimile : 84-8-3823-7811

SAMSUNG VINA INSURANCE CO., LTD. HANOI BRANCH8th Floor, VinaRe Building, No.141, Le Duau St. Hoan Kiem District, Hanoi, VietnamTelephone : 84-4-942-5251, 5253-4 Facsimile : 84-4-942-5250

ChinaSAMSUNG FIRE & MARINE INS. CHINARM 812 Shanghai International Trade Center No 2201 Yan an (W) RD Shanghai, China P. R. C. 200335Telephone : 86-21-6209-0498~9, 6208-0080, 6295-4800 Facsimile : 86-21-6295-5280

SAMSUNG FIRE & MARINE INS. CHINA, BEIJING BRANCH23F China Merchants Tower No.118, jianguolu, ChaoYang District, Beijing, China. 100022Telephone : 86-10-6566-8100, 2750 Facsimile : 86-10-6566-8140

SAMSUNG FIRE & MARINE INS. CHINA, SHENZHEN BRANCHRoom4601,New World Centre No.6009 Yi'tian Rd.Shenzhen P.R.C(China)Telephone : 86-755-8252-0390 Facsimile : 86-755-8252-0389

SAMSUNG FIRE & MARINE INS. CHINA, SUZHOU BRANCHRM.720, Century Financial Tower #1,Suhua Road Suzhou Industrial Park, Suzhou, Jiangsu,China 215021Telephone : 86-512-6292-5968 Facsimile : 86-512-6292-5977

SUBSIDIARY & JOINT VENTURE

SAMSUNG FIRE & MARINE INSURANCE CO., LTD.

Samsung Insurance Bldg. 87, Euljiro-1ga, Jung-gu, Seoul, 100-782, Korea

Telephone : 82-2-1588-5114 Facsimile : 82-2-758-4320

www.samsungfire.com

HEAD OFFICE

OVERSEAS NETWORK

U.S.A.SAMSUNG FIRE & MARINE INS. CO., LTD. U.S. BRANCH105 Challenger Road 4th Floor Ridgefield Park, New Jersey 07660-05511, U.S.A.Telephone : 1-201-229-6012 Facsimile : 1-201-229-6015

SAMSUNG FIRE & MARINE INS.CO., LTD., U.S. BRANCH, LA OFFICE14251 Firestone Blvd., La Mirada, CA 90638, U.S.A.Telephone : 1-562-229-0411 Facsimile : 1-562-229-0620

BRANCH OFFICES

Samsung Fire & Marine InsuranceAnnual Report 2009

SAMSUNG AFFILIATES

Samsung Fire & Marine Insurance Co., Ltd.

has affiliates in the Samsung Group which includes the below companies.

Finance

Samsung Fire & Marine Insurance Co., Ltd.

Samsung Life Insurance Co., Ltd.

Samsung Card Co., Ltd.

Samsung Securities Co., Ltd.

Samsung Asset Management

Samsung Venture Investment Corporation

Samsung CorporationSamsung Engineering Co., Ltd.Cheil Industries Inc.Samsung Everland Inc.The Shilla Hotels & ResortsCheil Communications Inc.S1 CorporationSamsung LionsSamsung Medical CenterSamsung Economic Research InstituteSamsung Advanced Institute of TechnologySamsung Foundation of CultureSamsung Welfare Foundation

Samsung Heavy Industries Co., Ltd.

Samsung Techwin Co., Ltd.

Finance Other Samsung Companies

Samsung Electronics Co., Ltd.

Samsung SDI Co., Ltd.

Samsung Electro-Mechanics Co., Ltd.

Samsung Corning Co., Ltd.

Samsung Corning Precision Glass Co., Ltd.

Samsung SDS Co., Ltd.

Samsung Networks Inc.

Samsung Total Petrochemicals Co., Ltd.

Samsung Petrochemical Co., Ltd.

Samsung Fine Chemicals Co., Ltd.

Samsung BP Chemicals Co., Ltd.

Electronics Chemicals

Machinery

Jan

uary

26, 1952

Foun

ded

as A

nbo

Fire

& M

arin

e In

sura

nce

Co.

, Ltd

.

Jan

uary

31, 1963

Acq

uire

d A

nkuk

Fire

& M

arin

e In

sura

nce

Co.

, Ltd

.

Marc

h 2

, 1963

Com

pany

nam

e ch

ange

d to

Ank

uk F

ire &

Mar

ine

Insu

ranc

e C

o., L

td.

1952SAMSUNG FIRE & MARINE INSURANCESTORY BEGINS... 2010

1950s

1960s

Ju

ne 1

, 1975

Initi

al P

ublic

Offe

ring

Feb

ruary

24, 1978

Ope

ned

offic

es in

Mas

an, D

ongb

u (e

ast),

Nam

bu (s

outh

)

Feb

ruary

4, 1979

Est

ablis

hed

a ris

k m

anag

emen

t ins

titut

e-a

first

amon

g K

orea

n no

n-lif

e in

sure

rs

Octo

ber

1, 1983

Laun

ched

aut

o in

sura

nce

divi

sion

Sep

tem

ber

1, 1985

Ope

ned

offic

e in

New

Yor

k (U

.S.)

Octo

ber

17, 1987

Con

stru

ctio

n of

hea

d of

fice

build

ing

com

plet

ed

May 2

6, 1989

Incr

ease

d ca

pita

l to

KR

W8.

4 bi

llion

1970s

1980s

Feb

ruary

10, 1990

Incr

ease

d ca

pita

l to

KR

W10

.0 b

illion

Marc

h 1

7, 1990

Incr

ease

d ca

pita

l to

KR

W 1

1.7

billio

n

Ap

ril 1, 1990

Ope

ned

bran

ch in

U.S

.

May 2

9, 1990

Incr

ease

d ca

pita

l to

KR

W12

.8 b

illion

Ap

ril 1, 1992

Ope

ned

Seo

ul C

usto

mer

Ser

vice

Cen

ter

Marc

h 2

6, 1993

Sel

ecte

d as

dom

estic

lead

man

ager

for

Kor

easa

t Ins

uran

ce

No

vem

ber

29, 1993

Ope

ned

Jaka

rta

offic

e (In

done

sia)

Decem

ber

6, 1993

Com

pany

nam

e ch

ange

d to

Sam

sung

Fire

&

Mar

ine

Insu

ranc

e C

o., L

td.

Jan

uary

10, 1994

Ope

ned

offic

e in

Tok

yo (J

apan

)

May 9

, 1994

Ope

ned

Yus

eong

Tra

inin

g C

ente

r

Octo

ber,

1994

Laun

ched

Soc

ial S

ervi

ce T

eam

of S

F&M

I

Ap

ril 20, 1995

Ope

ned

Bei

jing

offic

e (C

hina

)

Ju

ly 1

5, 1995

Ope

ned

offic

e in

Ho

Chi

Min

h C

ity (V

ietn

am)

Au

gu

st

28, 1996

Ope

ned

offic

e in

Han

oi (V

ietn

am)

Sep

tem

ber

20, 1996

Ope

ned

offic

e in

Sha

ngha

i (C

hina

)

No

vem

ber

7, 1996

Est

ablis

hed

a lo

cal s

ubsi

diar

y in

Indo

nesi

a

1990s

1990~

1993

1994~

1996

Ap

ril 4, 1998

Incr

ease

d ca

pita

l to

KR

W 1

4.8

billio

n

Octo

ber

15, 1998

Est

ablis

hed

Sam

sung

Fire

& M

arin

e In

sura

nce

Cla

imA

djus

tmen

t Ser

vice

Co.

, Ltd

.

Jan

uary

19, 1999

Incr

ease

d ca

pita

l to

KR

W 2

0.0

billio

n

Ju

ly 3

, 1999

Sto

ck s

plit

to K

RW

500

per

valu

e

1997~

1999

Jan

uary

30, 2000

Incr

ease

d ca

pita

l to

KR

W25

billi

on

May 3

0, 2000

Pai

d di

vide

nd o

n ac

coun

t of c

apita

l inc

reas

Ap

ril 24, 2001

Ope

ned

bran

ch in

Sha

ngha

i (C

hina

)

Ju

ly 1

, 2001

Est

ablis

hed

Sam

sung

Tra

ffic

Saf

ety

Res

earc

h In

stitu

te

Decem

ber

31, 2001

Sel

ecte

d as

one

of A

sia’

s “T

op 2

00 C

ompa

nies

” by

the

Far

Eas

tern

Eco

nom

ic R

evie

w, a

Hon

g K

ong-

base

d po

litic

al a

nd e

cono

mic

wee

kly

mag

azin

e

Jan

uary

18, 2002

Dec

lare

d 20

02 a

s th

e fir

st y

ear

for

“Sam

sung

Fire

& M

arin

eIn

sura

nce

Eth

ical

Man

agem

ent”

Jan

uary

26, 2002

Unv

eile

d tim

e ca

psul

e in

com

mem

orat

ion

of th

e 50

th a

nniv

ersa

ry o

fth

e co

mpa

ny

Ap

ril 2, 2002

Laun

ched

Sam

sung

“an

ycar

” au

to in

sura

nce

bran

d

Ap

ril 26, 2002

Won

the

“Mos

t Res

pect

ed p

rope

rty/

casu

alty

Insu

rer

Aw

ard”

at

“The

Firs

t in

Kor

ea”

awar

ds s

pons

ored

by

Kor

ea M

intin

g an

dS

ecur

ity P

rintin

g C

orpo

ratio

n

No

vem

ber

14, 2002

Est

ablis

hed

“Sam

sung

Vin

a In

sura

nce

Com

pany

Lim

ited

(SV

IC)”

as

a lo

cal s

ubsi

diar

y in

Vie

tnam

Marc

h 2

6, 2003

Sel

ecte

d as

the

“fai

rest

trad

er”

by K

orea

Fai

r Tr

ade

Com

mis

sion

May 2

6, 2003

Ope

ned

offic

e in

Qin

gdao

(Chi

na)

Decem

ber

10, 2003

Laun

ched

Sam

sung

Sup

er In

sura

nce,

the

indu

stry

’s fi

rst i

nteg

rate

din

sura

nce

prod

uct

Decem

ber

30, 2003

Sig

ned

an M

OU

for

Coo

pera

tion

and

Exc

hang

e w

ith C

hina

Pric

eIn

form

atio

n N

etw

ork,

a C

hine

se in

sure

r

Au

gu

st

19, 2004

Intr

oduc

ed “

Soc

ially

Con

trib

utin

g B

rand

” a

first

in th

e in

dust

ry

Au

gu

st

19, 2004

Cha

ngin

g its

nam

e in

to “

Sam

sung

Any

car

Soc

ial S

ervi

ce T

eam

”

Jan

uary

3, 2005

Ope

ned

Sam

sung

Los

s C

ontr

ol C

ente

r, th

e fir

st o

f its

kin

d in

the

hist

ory

of th

e pr

ivat

e se

ctor

Ap

ril 25, 2005

Est

ablis

hed

Sam

sung

Fire

& M

arin

e In

sura

nce

(Chi

na),

the

first

loca

l sub

sidi

ary

esta

blis

hed

by a

fore

ign

insu

rer

in C

hina

Ju

ly 2

2, 2005

Ope

ned

offic

e in

Lon

don

(U.K

.)

Sep

tem

ber

30, 2005

Laun

ched

“A

llife”

as

a fla

gshi

p br

and

for

long

-ter

m in

sura

nce

Feb

ruary

27, 2006

Ren

ewed

the

2006

Sam

sung

any

car

Vol

unte

er G

roup

Ap

ril 4, 2006

Intr

oduc

ed th

e sl

ogan

“Li

ving

Insu

ranc

e” in

long

-ter

min

sura

nce

Ju

ly 2

7, 2006

Ope

ned

Bei

jing

offic

e of

Chi

na s

ubsi

diar

y

No

vem

ber

27, 2006

Unv

eile

d th

e M

etro

Pol

e 50

, a n

eon

scul

ptur

e

No

vem

ber

29, 2006

Won

“P

resi

dent

ial A

war

d” a

t “K

orea

Bra

nd A

war

ds”

Decem

ber

12, 2006

Rec

eive

d “P

resi

dent

ial C

itatio

n” a

t the

Firs

t and

For

emos

tM

ovem

ent f

or P

erso

ns w

ithD

isab

ilitie

s A

war

ds

Decem

ber

20, 2006

Won

“P

resi

dent

ial A

war

d” a

t the

“D

igita

l Kno

wle

dge

Man

agem

ent A

war

ds”

Jan

uary

9, 2007

Sam

sung

Tra

ffic

Saf

ety

Res

earc

h In

stitu

te (S

TSR

I) re

ceiv

ed“S

amsu

ng A

war

d of

Hon

or”

Jan

uary

18, 2007

Nam

ed a

n “A

sian

Fab

50”

com

pany

in th

e A

sia

Pac

ific

Reg

ion

by F

orbe

s

Feb

ruary

21, 2007

Ope

ned

Rai

lroad

Win

g at

the

Sam

sung

Tra

nspo

rtat

ion

Mus

eum

Decem

ber

21, 2007

Ope

ned

She

nzhe

n of

fice

of C

hina

bra

nch

2000s

2000~

2004

2005~

2007

Ju

ly 1

0, 2008

Ope

ned

Suz

hou

offic

e of

Chi

na s

ubsi

diar

y

No

vem

ber

20, 2008

Ope

ned

the

first

FP

Cen

ter

in th

e in

dust

ry

Decem

ber

12, 2008

Ope

ned

offic

e in

Sin

gapo

re

Feb

ruary

26, 2009

Ope

ned

Qin

gdao

offi

ce o

f Chi

na s

ubsi

diar

y

Marc

h 3

, 2009

Laun

ched

Inte

rnet

aut

o in

sura

nce

serv

ice

Ap

ril 23, 2009

Est

ablis

hed

an o

ffice

in In

dia

Ju

ly 1

, 2009

Laun

ched

Any

Hom

e G

ener

al In

sura

nce

Sep

tem

ber

15, 2009

Ope

ned

a su

bsid

iary

in B

razi

l

2008~

2009

Ap

ril 15, 2010

Cer

emon

y fo

r th

e 10

0th

hous

e of

“K

RW

500

Gift

of H

ope”

Ju

ne 2

1, 2010

Sig

ned

a co

mpr

ehen

sive

bus

ines

s tie

-up

deal

with

H

uata

i Ins

uran

ce o

f Chi

na.

Ju

ly 1

, 2010

Ann

ounc

ed a

New

Bra

nd S

loga

n, “

thin

k N

EXT

”

Ju

ly 1

4, 2010

Mad

e ou

r fir

st d

onat

ion

for

the

esta

blis

hmen

t of

“Hap

py S

choo

l”.

2010

CORPORAT

EHIS

TORY

LIAISON OFFICES

Japan (Tokyo)SAMSUNG FIRE & MARINE INSURANCE CO., LTD.,

TOKYO LIAISON OFFICE

Roppongi T-CUBE 3-1-1, Roppongi, Minato-Ku, Tokyo 106-8532, JapanTelephone : 81-3-6234-2208 Facsimile : 81-6234-2207

China (Beijing)SAMSUNG FIRE & MARINE INSURANCE CO., LTD.,

BEIJING REPRESENTATIVE OFFICE

25F China Merchants Tower No.118, jianguolu, Chaoyang District, Beijing, China 100022Telephone : 86-10-6566-8100 Facsimile : 86-10-6566-9408

China (Qingdao)SAMSUNG FIRE & MARINE INS.

CHINA, QINGDAO BRANCH

Rm 907, Flagship Tower New World Cyberport, 40, Hongkong Middle Road, Qingdao 266071, ChinaTelephone : 86-532-8502-7271 Facsimile : 86-532-8502-8248

U.K. (London)SAMSUNG FIRE & MARINE INSURANCE CO., LTD.

LONDON REPRESENTATIVE OFFICE

21st Floor, Tower 42, 25 Old Broad Street, EC2N 1HP, London UNITED KINGDOMTelephone : 44-207-786-7851~4 Facsimile : 44-207-786-7866

IndiaSAMSUNG FIRE & MARINE INSURANCE CO., LTD.,

INDIA REPRESENTATIVE OFFICE

122-009 2nd Floor, Samsung Electronics, Vipul Tech Square, Golf course road, Sector 43 GurgaonHaryana, IndiaTelephone : 91-124-488-1234-2060 Facsimile : 91-124-488-2090

SingaporeSAMSUNG FIRE & MARINE INSURANCE CO., LTD.,

SINGAPORE REPRESENTATIVE OFFICE

3 Church Street #21-05 Samsung Hub Building, Singapore 049483Telephone : 65-6550-8112 Facsimile : 65-6550-8115

120 121Financial Section Worldwide Network & Samsung Affiliates

BrasilSAMSUNG FIRE & MARINE CONSULTORIA EM SEGUROS LTDA

Av. Das Nacoes Unidas, 12901- Torre Oeste 22 andar- Brooklin Novo S.o Paulo SP Brasil 04578-910Telephone : 55-11-5105-5040 Facsimile : 55-11-5105-5041

2009-1화재표지최종 2010.9.10 9:0 PM 페이지2 CTP-4

INVESTOR RELATIONS

Corporate Planning Division, Samsung Fire & Marine Insurance. Co., Ltd.

Samsung Insurance Bldg. 87, Euljiro -1ga, Jung-gu, Seoul, Korea,100-782E-mail: ir.samsungfire@samsung.comTelephone: 82-2-758-7535Facsimile: 82-2-758-7831

View our interactive on-line annual report atir.samsungfire.com

THINK NEXT

BRAND STRATEGY

FINANCIAL HIGHLIGHTS

2009 AT A GLANCE

MESSAGE FROM THE CEO

CORPORATE DIRECTORY

CORPORATE GOVERNANCE

REVIEW OF OPERATION

AUTOMOBILE INSURANCE

LONG-TERM INSURANCE

COMMERCIAL INSURANCE

ENTERPRISE RISK MANAGEMENT

SUSTAINABILITY MANAGEMENT

ETHICAL MANAGEMENT

ENVIRONMENT MANAGEMENT

CORPORATE COMMUNITY RELATIONS

SPORTS

CULTURE

FINANCIAL SECTION

MD&A

FINANCIAL STATEMENTS

WORLDWIDE NETWORK & SAMSUNG AFFILIATES

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52

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120

CONTENTS

An

nu

al Rep

ort

20

09

TH

E G

LO

BA

L P

ION

EE

R

We always care our customers and shareholderswww.samsungfire.com http://ir.samsungfire.com

This report is printed on an Fsc certified paper in Soyink

2009-1화재표지최종 2010.9.10 9:0 PM 페이지1 CTP-4