Hyundai Marine Sustainability Report 2004-2005 ABOUT SUSTAINABILITY REPORT...

Our 2004-2005 Sustainability Report is the first of its kind to report on the performance of sustainability management which is standing in the spotlight as a new paradigm of global management age today. It takes account of Hyundai Marine’s economic, environmental and social contribution to the society and the state as well as its impact on interested parties such as customers, stakeholders, employees and competitors.

This report demonstrates Hyundai Marine’s commitment to corporate social responsibilities and duties. It introduces the purpose and mission of Hyundai Marine in pursuing customer satisfaction and sustainability management and serves as a channel of communication for Hyundai Marine and interested parties.

The aim of sustainability report is to provide accurate information to interested parties on appropriate occasions and facilitate the long-term progress of sustainability management by generating sufficient feedback on Hyundai Marine’s sustainability and social responsibility. The sustainability report therefore is a testament to our endeavors to enhance Hyundai Marine’s transparency and reliability. CONTENTS

COMPANY PROFILE OUR CUSTOMERS OUR PEOPLE MANAGEMENT PERFORMANCE 28 Best Products & Services 54 Employees and Working Environment SCOPE OF REPORT 31 Warranty 56 Development of People 32 Convenience for Customers 59 Communication with People 34 Communication with INTRODUCTION Customers OUR SHAREHOLDERS 10 Message from CEO 36 Information Protections 62 Corporate Governance 12 History of 50 Years 64 Communication with Shareholders 14 Management Policies OUR SOCIETY 15 Vision Hi 2010 40 Social Contribution Activities APPENDIX 16 Business Ethics 45 Responsibilities and 66 Assurance Report Obligations to Society 67 GRI Index SUSTAINABILITY MANAGEMENT 71 Ethics Codes 20 Sustainability Management Model OUR ENVIRONMENT 76 Customer Evaluation of 2004-2005 21 Highlights in 2004 and 2005 48 Environmental Protection Sustainability Report 22 Management Innovation Activities 79 Contact Us 24 Risk Management 50 Environmental Management ) Unit : KRW 1 million, person 2,650 March 5, 1955 Insurance Jong-Sun Ha 5,574,670 Hyundai Marine & Fire Insurance, Co., Ltd. COMPANY PROFILE COMPANY Name Headquarters Address 178 Sejongno, Jongno-gu, Seoul, Korea Date of Establishment Type of Business President & CEO Total Assets Number of Employees * Data as of March 31, 2005 Hyundai Marine & Fire is a premium, large-scale non-life insurance company which currently company which non-life insurance large-scale & Fire is a premium, Hyundai Marine Hyundai Marine has eight regional headquarters and 50 branch networks in Korea. Abroad, there are branch offices Hyundai Marine has eight regional headquarters and 50 branch networks in Korea. Abroad, In January 2005, Hyundai Marine was awarded a credit rating of ‘BBB Stable’ from S&P, a global credit rating agency, In January 2005, Hyundai Marine was awarded a credit rating of ‘BBB Stable’ from S&P, a global COMPANY PROFILE COMPANY for its outstanding financial performance, market power, efficient underwriting and secure asset management. Prior to this, for its outstanding financial performance, market power, efficient underwriting and secure issued the rating of A-(Excellent A.M. Best, the world’s oldest and most authoritative insurance rating and information source, to Hyundai Marine in both 2003 and 2004, allowing Hyundai Marine to consolidate its position as one of the most to Hyundai Marine in both 2003 and 2004, allowing Hyundai Marine to consolidate its position reliable non-life insurance companies in Korea. The company also operates in Japan and the United States as well as representative offices in London, Beijing and Hochiminh. provide optimum services to our 11 customer services centers, 36 customer contact points and 81 claims service centers to customers anywhere and anytime. places second in terms of sales and total asset in Korea’s domestic insurance sector. In the fiscal year 2004, insurance sector. In Korea’s domestic and total asset in in terms of sales places second realized KRW and financial planners, and 14,854 agencies staff members with its 2,650 Hyundai Marine, of net income. premiums written and KRW 68.1 billion 3,167.1 billion of direct

HYUNDAI MARINE SUSTAINABILITY REPORT 2004-2005 Be The Hi 04 I 05 COMPANY PROFILE Types of Business : System Integration & Management, Risk Management Investment of Hyundai Marine: 100% Hyundai Marine Claims Service, Co., Ltd. 50%, Kyung-il Industrial Development, Co., Ltd. 50% Types of Business : Service, manufacturing, construction Investment of Hyundai Marine: 100% Type of Business : Service (automobile & claims adjustment) Investment of Hyundai Marine: 100% Type of Business : Insurance Investment of Hyundai Marine: 100% Type of Business : Investment Management & Investment Entrusting Investment of Hyundai Marine: 100% Types of Business : Auto-guard Service, Total car service, Emergency Road Service, Automobile-insurance related Services Investment of Hyundai Marine: 100% 11th Floor, Yamato Seimei Bldg., 1-1-7, Uchisaiwai-cho, Chiyoda-ku, 11th Floor, Yamato Seimei Bldg., 1-1-7, Uchisaiwai-cho, Tokyo, Japan 7th Floor, Yuseigojyokai-Shinsaibashi Bldg., 3-11-18, Minamisenba, Chuo-ku, Osaka, Japan 3070 South Bristol St.Suite 660, Costa Mesa, CA 92626 U.S.A. (Registered Address) 300 Sylvan Ave.Englewood Cliffs,NJ 07632,U.S.A (Mailing Address) 37-39 Eastcheap London, EC3M 1 DT, U.K. Nguyen Hue Room No.1002, 10th Floor, Harbor View Tower Bldg., 35 St., Dist. 1, Hochiminh City, Vietnam Room No.1101, Landmark Bldg.8,North Dongsanhuan Road, Chaoyang District Beijing, China 37-39 Eastcheap London, EC3M1DT, U.K Osaka Tokyo Hyundai Hi Service, Co., Ltd. Hyundai HDS, Co., Ltd. Kyung-il Industrial Development Co., Ltd. Hyundai Marine Claims Service, Co., Ltd. HYUNDAI U.K. UNDERWRITING LTD Hyundai M&F Investment Management, Co., Ltd. Japan Branch Office U.S. Branch Office London Representative Office Hochiminh Representative Office Beijing Representative Office Hyundai U.K. Underwriting Ltd. SUBSIDIARY COMPANIES INTERNATIONAL NETWORK INTERNATIONAL 3.0%

35.0% 45.1% 68,105 3.4% 12.3%

Unit : KRW 1 million 2004 1.3% 50,021

as of March 31, 2005 as of March 31, 2003 22.6% 3,167,118 68,105 82.4% Automobile insurance Long term insurance Individual annuity insurance Other insurance fire insurance marine insurance 41,231 Unit : KRW 1 million

2002

[ NET INCOME ] 128,385 2001 BY CATEGORIES IN FISCAL 2004 ] [ NET PREMIUM INCOME WRITTEN FY2004 Expense ratio Direct premiums written Net income Loss ratio FINANCIAL DATA FINANCIAL 68,105

2004 50,021

2003 41,231

2002 128,385 Unit : KRW 1 million [ NET INCOME ]

2001

27,359 △

2000 5,574,670 년 50,021

2004

382,721 156,632 236,014 2,893,703 2,431,022 2,434,951 4,957,787 4,281,817 4,957,787 △ 2003

2003 4,401,692 ￦

2002 3,866,645 Unit : KRW 1 million [ TOTAL ASSETS ]

68,105 Unit : KRW 1 million

2001 년 452,962 170,072 260,232 3,167,118 2,657,373 2,584,371 5,574,670 4,702,259 3,240,054 △ 2004 2000

￦ 3,167,118

2004 2,893,703

2003 2,835,053

Hyundai Marine spares no efforts in maximizing financial gains of interested parties and, as a no efforts in maximizing financial Hyundai Marine spares Hyundai Marine seeks to attain the company’s ultimate goal of maximizing profit by engaging profit by goal of maximizing the company’s ultimate seeks to attain Hyundai Marine 2002 2,639,991 Unit : KRW 1 million 2001

Total assets Invested assets Total equity Direct premium written Net premium written Earned premium Underwriting income Operating income on investment Net income 2,329,327 [ DIRECT PREMIUM WRITTEN ] 2000 MANAGEMENT PERFORMANCE MANAGEMENT in sustainability management as well as efficient asset and risk management. In fiscal year 2004, despite risk management. In fiscal year 2004, as well as efficient asset and in sustainability management Marine market environment, Hyundai economic downturn and fiercely competitive the overall domestic Even even business performances per category. high 9.4% growth rate thanks to the achieved a relatively gains from Marine made 10.3% growth in downward trend of interest rate, Hyundai with the continuing a rapid the swelling of interest income from from the previous year through investment management high-return financial products. assets and expansion of investment on increase of invested result, the net income was recorded at KRW 68,105 million, up 36.2% since last year. was recorded at KRW 68,105 million, result, the net income

HYUNDAI MARINE SUSTAINABILITY REPORT 2004-2005 Be The Hi 06 I 07 MANAGEMENT PERFORMANCE Our Currently, there are no set Currently, there are no This report describes the INDEPENDENT VERIFICATION PRINCIPLES PERIOD sustainability management performances of sustainability management performances and claims services centers in Seoul headquarters to regional branch offices from April 1, 2004 and March 31, 2005, unless noted otherwise, does not include activities of overseas branches to and subsidiary companies. Please refer Hyundai Marine’s ‘Annual Report 2005’ for main in business and financial information. All figures this report on based on Korean wons. guidelines for sustainability reports. But we guidelines for sustainability Reporting Initiative) ’2002 referred to GRI’s (Global Report’ to meet the Guideline for Sustainability Please refer to standards of global enterprises. the content of this pages 67-70 to compare The figures printed in report to the GRI guideline. Korean fiscal standards this report are based on for enterprises. Sustainability Report underwent BSR five step verification process conducted by the Institute for Industrial Policy Studies (IPS). The IPS’s assurance report is on page 66 of this report. The By illustrating our efforts to carry out Given the characteristics of public Based on the management policies of Given the peculiar nature of Hyundai’s ABOUT SUSTAINABILITY REPORT ABOUT SUSTAINABILITY 2004-2005 Sustainability Report demonstrates 2004-2005 Sustainability achievement in enlarging Hyundai’s 50 years of development and the its potential for sustainable for future sustainable company’s vision a detailed report on management. It provides from balanced and Hyundai’s performance environmental and comprehensive economic, social perspectives, as known as the triple bottom line. work, the following describes the unique the qualities of this report attributable to company’s insurance business. FIRST, and the CEO, the report presents the direction in ideals of sustainability management embodied the company’s vision and strategies. Our motto ‘Hi 2010, the best insurance company in Korea’ to reflects our potential and determination become not only the premium insurance company in the country but also worldwide. The report, therefore, lists both our past achievements as well as future plans and objectives. SECOND, our innovative management methods and satisfy customers, we attempt to show our commitment to sustainability management to the interested parties. THIRD, enterprises Hyundai Marine, like other insurance companies, possess, our work is hardly restricted to marketing insurance products and services: we are fully aware of corporate social responsibilities to safeguard our customers and their wealth. Our efforts to carry out these duties are carefully documented in this report. SCOPE OF REPORT SCOPE SINCE ITS FOUNDATION IN 1955 AS KOREA’S FIRST INSURANCE COMPANY TO SPECIALIZE IN MARINE INSURANCE, HYUNDAI MARINE HAS STOOD BY ITS CUSTOMERS FOR 50 YEARS. WE BELIEVE THAT IT WAS YOUR SUPPORT WHICH ENABLED US TO PRIDE OURSELVES ON CUSTOMER SATISFACTION. WE THANK YOU AND PROMISE YOU THAT, WE AT HYUNDAI MARINE, WILL DEDICATE OURSELVES TO YOU AND YOUR PROSPERITY, AS WE DID IN THE PAST 50 YEARS, FOR THE COMING 50 YEARS. INTRODUCTION CEO Message History of 50 Years Management Policies Vision Hi 2010 Business Ethics CEO MESSAGE

HYUNDAI MARINE SUSTAINABILITY REPORT 2004-2005 Be The Hi 10 I 11 CEO MASSEGE ’ ethical ‘ , ’ October 17, 2005 social responsibility ‘ and s interests, reduction in the sustainability management legal management ’ ’ ‘ ‘ Hyundai Marine & Fire Insurance, Co, Ltd. s Sustainability Report, the s Sustainability will promote the co-existence and co- ’ ’ environmental management ‘ , ’ in April 2003 is a testament to our endeavors to become the most in April 2003 is a testament to our endeavors ’ sustainability management ‘ Vision Hi 2010 ‘ transparent management We are certain that ‘ Since its birth in 1955, Hyundai Marine, along with seven other companies which also began Hyundai Marine, along with seven Since its birth in 1955, , ’ ’ I am convinced that this report, although may not seem particularly significant at this very moment, will I am convinced that this report, although may not seem particularly significant The announcement of Our main business objective is, of course, maximizing profit. But in the modern age where corporate social Our main business objective is, of course, Through this report, we were able to not only evaluate our past activities and learn from our mistakes but Through this report, we were able to not only evaluate our past activities and management responsibility is gaining importance, sales and profit alone hardly guarantee further success. To face this responsibility is gaining importance, of Hyundai Marine the principle of challenge, we have placed at the heart number of employees and officers and improvement of their welfare. number of employees and officers and by 2010. In the mean time, we strive to be a company which keeps competitive insurance company in Korea of security to its shareholders and investors, and last but not least, promises with its customers, offers a sense and officers can grow together. provides an environment where employees conveys the notions of which we believe effectively and comprehensively and officers the publishing of Hyundai Marine the publishing and officers I would like to share with our customers, shareholders, investors, employees share with our customers, I would like to In 2005, Hyundai Marine celebrated its 50th anniversary. Marine celebrated In 2005, Hyundai amid the ruins of the Korean War, are consistently ranked within top 100 enterprises in Korea. I believe that amid the ruins of the Korean War, are only through our constant attempts to adhere to the current business such achievement was made possible management and corporate social responsibility - by means of paradigm - business ethics, transparent maximum guarantee of shareholder customer-oriented management policies, serve as a gateway to our path to becoming a first-class insurance company in the 21st century. serve as a gateway to our path to becoming a first-class insurance company in also to gain a better understanding of our company and reconfirm our future plans. prosperity of all stakeholders including customers, shareholders, employees and officers, competitors, the prosperity of all stakeholders including customers, shareholders, employees society and the state. management. first of its kind in the insurance sector. first of its kind 1950~1960

1970

1980

HISTORY OF 50 YEARS 1950~1960 Korea’s first insurance company specializing in marine insurance / Hyundai particular, placed Hyundai Marine in a dominant position within the industry, enabling Hyundai to Marine was established on March 5, 1955 under the name Dongbang Marine InsuranceCo., Ltd take up more than half of the overall long-term insurance market and, in 1974, achieve the highest (hereinafter‘ Dongbang Marine’). Dongbang Marine was the first company in Koreato specialize in overall result. marine insurance and facultative reinsurance. Branch offices in Japan and starting business abroad / The opening of the Tokyo A Merger with the Korean Non-Life Reinsurance Corporation and office which was the first overseas branch among the domestic non-life insurers in October 1976 left Advancement into Fire Insurance / Hyundai Marine was established on March 5, 1955 an indelible mark in the history of Korean insurance industry. For the first time, Dongbang Marine stood side by side with Japanese and 36 foreign insurance companies in Japan with which it under the name Dongbang Marine InsuranceCo., Ltd (hereinafter‘ Dongbang Marine’). Dongbang Marine was the first company in Koreato specialize in marine insurance and facultative reinsurance. exchanged valuable information and resources. What is more, reinsurance transactions allowed Dongbang Marine to earn foreign currency without risking lump-sum loss. Pioneering the specialized insurance market / Thanks to the expansion of specialized insurance market in the wake of the Vietnam War and rapid economic development, Dongbang Marine produced the highest results among the 10 competing firms in 1965 and 1966. 1980 Consequently, Dongbang Marine, despite its late start, immediately became a leading non-life insurance company in Korea. Becoming Hyundai Marine & Fire Insurance, Co., Ltd. / On October 17, 1983, Dongbang Marine became part of Hyundai following the Hyundai Group’s acceptance of Dongbang’s Introduction of long-term insurance / Benchmarking the Japanese insurance market, shares. Dongbang Marine declared its rebirth and assumed the name Hyundai Marine & Fire Insurance Dongbang Marine introduced long-term insurance in the late 1960’s to overcome the challenges of Co., Ltd in October 1985 on the occasion of the company’s 30th anniversary. being a latecomer. The significance of this lays in the fact that the adoption of long-term insurance policy, in essence, served as a harbinger of a practice area that now constitutes the core of insurance Into the Automobile Insurance Market / In 1983, the negotiation process between industry. Dongbang Marine and Hyundai Group on share acceptance began in accordance with the government policy. And in September of the same year, the government approval to enter the automobile insurance market was issued. With the participation of 12 domestic insurance companies 1970 and 2 foreign companies, the automobile insurance market became extremely competitive and, as a result, heightened the need for customer service. In this sense, the polycentrism of the automobile Expanding overseas / The progressive nature of Dongbang Marine is embodied in the insurance market provided the ground for an overall improvement of service in the insurance sector. establishment of the New York office in June 1971 followed by the opening of branch locations in Tokyo and London. Dongbang Marine’s activities abroad certainly played an important role in the Strengthening Claims & Customer Service / A separate Claims & Customer Services globalization of Korea’s insurance industry. But more importantly, they consolidated Dongbang division was created under the organization restructuring scheme of 1984, laying the basis for efficient Marine’s position as not only the first insurance company to branch out internationally but as the damage assessment and differentiated classes of service through a strict division between marketing industry’s forerunner which remains unsurpassed in its ability to gather latest information and acquire business and claims service. To gain competitiveness in the automobile insurance market, Hyundai new skills. Marine improved the quality of claims service and boosted customer service. Thanks to the system of differentiated classes of service, Hyundai Marine became known as the best insurance company in the Popularizing general insurance / From the early 1970’s, Hyundai Marine began working claims service category. in cooperation with A/U to create an accident insurance market that attracted personal customers and challenged the conventional view of insurance as applicable solely to large-scale corporations. No. 1 General Insurance Company / Although Hyundai Marine underwent major Hyundai Marine is also responsible for developing a personal accident insurance market into a market- restructuring and internal reform under the supervision of the Hyundai Group and achieved oriented insurance market. consistent growth, it remained weak in security and asset management compare to the company ranking first in the insurance sector. But despite such shortcomings, Hyundai Marine came first in the A front player in the long-term fire insurance sales / The implementation of long- overall management assessment of insurance company, signaling a bright and promising future for term insurance policy was a turning point for Hyundai Marine. The long-term fire insurance policy, in the company 1990

2000

1990 2000 Breaking New Grounds / Hyundai Marine embarked on a new mission to penetrate Europe 24-hour Mobile Claims Service / In April 1999, Hyundai Marine, under the slogan ‘fast and and the United States where the ideas for insurance were first conceived and Asia where there exists convenient claims service’, began operating a 24-hour mobile claims service which carries out all an enormous potential for insurance market. It opened an office in Singapore in June 1991 and necessary procedures at the place of accident including dispatching claims officer within 30 minutes entered into a business agreement with China’s PICC regarding marine insurance and overseas travel of the accident, assessing negligence, aiding police investigation and issuing ‘certification of insurance insurance. The U.S. office was established in February 1994, more than a year after obtaining a subscription’. At the time, the service was offered only in six major cities; but by September 2001, it business approval from the California state in December 1992. In 1997, a representative office was was available nationwide and soon became known as the ‘24-hour Speedy Service’. opened at Lloyd’s of London. 2002 FIFA World Cup Official Supplier / As the official insurance supplier of the 2002 Passing the 1 Trillion Won Mark / In the 1990’s, Hyundai strove to deliver a uniform World Cup, Hyundai Marine exercised exclusive rights over all events and activities during the game performance across all insurance categories. As a leading insurance company, Hyundai Marine not and gained public confidence at the international level. only focused on external growth but also internal development by devising a long-term management strategy ‘High Vision 2000’ in pursuit of the company’s ultimate goal of becoming ‘a premium ‘HiCar’ Automobile Insurance / To dominate the automobile insurance market amid the insurance company in the 21st century’. In 1995, the company’s efforts to grow, both in quality and movement for free-pricing in 2001, Hyundai Marine launched a ‘HiCar’ brand and the exclusive ‘HiCar quantity, resulted in direct sales as well as total assets over 1 trillion won and a reaffirmation of its Service’ in an effort to strengthen its competitiveness. The HiCar Service, in particular, is widely position as the top insurance company. acknowledged for revolutionizing the concept of service from ‘after’ to ‘before’.

Launching the Customer-oriented Management / In 1994, Hyundai Marine ‘Vision Hi 2010’, a Mid to Long-Term Strategy / In April 2003, Hyundai Marine proclaimed a mid to long-term business strategy ‘High Vision 2000’ while concentrating on announced ‘Vision Hi 2010’ which foresees Hyundai Marine as the most competitive insurance recapturing the insurance market. Two years later, it issued ‘The Charter of Customer Satisfaction’, the company in Korea and one that helps customers cherish their dreams and hopes 1st in customer first of its kind in the insurance sector, and designated1996 as ‘the year of customer service’. To fulfill satisfaction, offers a sense of security to its shareholders and investors 1st in return on equity and the promise of enhanced customer service, Hyundai Marine implemented a number of management provides an environment where employees and officers can grow together No.1 preferred workplace policies with varied outlook. among top-notch candidates

Earning ISO 9002 in the Automobile Insurance Claims Service Category / HiCar, 1st place in GCSI / Since its launch in August 2001, the HiCar Service programme has Hyundai Marine was awarded ISO 9002 in January 1997, becoming the first insurance company to stood at the forefront of the automobile service market. In March 2005, it was ranked no. 1 in GCSI receive a certificate in the automobile insurance claims service category. This proved the superior conducted by Japan Management Association Consulting. quality of Hyundai Marine’s customer service which, in addition to management based on trust, were regarded highly by foreign countries. Prior to this, Hyundai Marine was ranked 40th by S&P among non-life insurers worldwide in December of the previous year. Within Korea, it won the third annual ‘Best Company in the insurance service sector’ in October 1998.

Breaking Away from the Hyundai Group and Introducing New CI / To differentiate and develop core business areas, Hyundai Group announced plans to promote specialized subsidiary companies. As part of this effort, Hyundai Marine worked out longterm plans to build management strategies and create a unique company image that would place Hyundai Marine at the top. In January 1999, Hyundai Marine, now self-sufficient, introduced a new CI and declared its rebirth as an independent company specializing in finance. SUSTAINABILITY REPORT 2004-2005 HYUNDAI MARINE MANAGEMENT POLICIES

Sustainability Management based on Policies

Bearing in mind the customer-oriented management policies, Hyundai Marine will try its best to fulfill its corporate social responsibility toward its customers, shareholders, employees, the society and the state. It will carry out its management activities faithfully by highlighting the safety of its customers and his or her wealth and, in doing so, build the company’s potential for further development. We believe that sustainability management is possibly only when there is coordinated effort of all stakeholders from economic, environmental and social standpoint. By performing our duties effectively, we will proceed to become a ‘corporate citizen’ required of the society and a company capable of effectively performing sustainability management.

The Leading company MANAGEMENT POLICIES Hyundai Marine looks for in the financial industry outstanding and qualified candidates with ‘exceptional creativity’ and ‘unrelenting driving force’. Hyundai Marine’s officers, employees and the sales workforce, armed with exceptional creativity and unrelenting driving force, strive to become the best in the financial business sector. Also, by having the best adventure products and differentiated services, we seeks to prepare for unexpected risks and Society Company thereby contribute to making your home a happy place, Fertile Society The Prosperity Customer and your company, a prosperous place. satisfaction Hyundai Marine is able to lead the financial industry thanks to its outstanding creativity and powerful driving force. By Family placing customer satisfaction at the center of Happiness all activities and providing happiness to Outstanding Unrelenting families and the prosperity to companies, creativity driving force Hyundai Marine contributes to the fertility of the society and development of the national economy. The whole sentence of Management Policies

CHARTER OF CUSTOMER SATISFACTION Convinced that customer satisfaction is central to the company’s business management, Hyundai Marine issued ‘The Charter of Customer Satisfaction’ to maximize customer satisfaction and provide optimum service. By implementing customer satisfaction policies from various angles, Hyundai Marine attempts to encourage participation of all employees and create harmony amongst them.

Bearing in mind the centrality of customer satisfaction in all activities and the significance of customer satisfaction as the driving force behind the company’s development, signs of hard work and the company’s ultimate goal, Hyundai Marine will provide optimum service at every customer encounter to maximize customer satisfaction and happiness. The whole sentence of the Charter of Customer Satisfaction VISION HI 2010 14 I 15 For the better future, MANAGEMENT POLICIES Hi The Be Hyundai Marine’s visions and strategies

‘Vision Hi 2010’ embodies the status and confidence of Hyundai Marine, a top Korean insurance company who is as equally competitive as the foreign companies entering the domestic market. We aim to become a company which satisfies our customers, shareholders and employees by providing optimum service, a secure structure for profit-making, and a selfregulated and original management system and which promotes expansion of the service sector through strengthening of competitiveness and differentiation of insurance service. We promise you that our endeavors to acquire competitiveness of highest quality and to provide insuranceoriented differentiated service will compel customers to label Hyundai Marine as the most preferred insurance company.

As a reliable partner to our customers, Hyundai Marine provides the best products and differentiated services that will help the customers achieve their dreams Korea’s Most Competitive Insurance and hopes. When Hyundai Marine finishes first in line in Company customer satisfaction index, proof of all its accomplishments would have been given. Upon a successful transformation, we will be a company that, by providing the best products and differentiated services, helps our customers keep their 4 MAIN OBJECTIVES hopes and dreams. For our shareholders, we will be a PURSUIT OF JUSTICE company that, by creating the best corporate value, is safe Seeking justice based on common sense and ethics to invest in. And to our employees, we will be a company which prioritize customers and shareholders with a nurturing work environment where talents can grow MUTUAL TRUST and flourish. Fostering an independent and creative environment rooted in mutual trust Hyundai Marine’s vision is more than a word. Every EMPHASIS ON EFFICIENCY year, we come up with new strategies to enhance the Promoting efficiency in business while keeping in management system and prepare for new challenges that mind the importance of profit-making confront us. We have been following closely one of the new FORWARD-LOOKING projects called ‘6 Sigma’ to reach the company’s maximum Taking appropriate stances in accordance with efficiency level by means of internal reform. changing circumstances for consistent growth and development

‘Vision Hi 2010’ was derived from the success of 8 MAIN STRATEGIES eight main strategies. First, we will create a work Fostering a work environment based on trust, independence and creativity 1 environment based on trust, independence and Developing advanced personnel management and an efficient organization 2 creativity and develop advanced personnel management and an efficient organization. Then we Revolutionizing business tactics to customer-oriented strategies based on IT 3 will revolutionize our business tactics to customer- Adopting an advanced business system 4 oriented strategies based on IT followed by an adoption of advanced business system. We will also manufacture Manufacturing leading products and services 5 leading products and service as well as pluralize means Pluralizing means of profit-making by opening new markets and new channels 6 of profitmaking by opening new markets and new Strengthening underwriting, compensation and basic business operations 7 channels. Lastly, we will strengthen the basics of business operations and consolidate risk management Consolidating risk management system for assets and debts necessary for profit-making 8 system for asset and debts necessary profit-making. SUSTAINABILITY REPORT 2004-2005 HYUNDAI MARINE BUSINESS ETHICS

Our ethics-based management refers to all activities that channel transparent management and honest business operation. These activities help customers build trust toward Hyundai marine who strives to fulfill its commitment to customer satisfaction. With aim of becoming the best insurance company of the 21st century, we intend to fulfill our social obligations and duties toward our customers, shareholders, officers, competitors, the society and the state. As part of our efforts to pursue of justice, we have been working hard to convey transparency and fairness in all of our works.

On May 20, 2003, Hyundai Marine legislated and declared the company’s business ethical standards on carrying out the obligations and duties toward interested parties. Also, ‘Compliance Department’ was set up to monitor the company’s practice of ethics in its business activities. Since then the compliance department has been the centre of various programs which promotes business ethics. Hyundai Marine will continue to build an ethical environment based on trust, fairness and independence and furthermore, adhere to ethical standards to obtain competitiveness unsurpassed in the domestic insurance industry.

HYUNDAI MARINE’S CHARTER OF ETHICS The ETHICAL MANAGEMENT PROGRAM To expand following lists the standards for decision-making and ethics-based management, Hyundai Marine has been activities Hyundai Marine follows in regard to the interested pushing ahead with various activities including publishing parties. an ‘Ethical Management Handbook’ and ‘Hi-Five Codes of Right Marketing for the Insurance Sales Agents’, launching a website called ‘Hi E&C’ to encourage employees to put First, we respect our clients and their opinions. business ethics into practice, publicizing examples of ethical We place customer satisfaction at the center of our management and hosting ethical management-themed business and seek to increase their value. activities. We aspire to spread and establish business ethics in corporate culture that everyone can enjoy. Second, we provide transparent and fair information to our shareholders and protect their interest by means of sound business management.

Third, we respect human dignity and value and create a corporate culture faithful to the basics.

Fourth, we compete against other companies freely and fairly and engage in logical business transactions for mutual trust and co-existence.

Fifth, we contribute to the development of society by securing prosperity and providing security and to the state by fulfilling our tax duties and supplying employment.

_‘Charter of Ethics’ in ‘Hi-E&C’ : www.hi.co.kr Be The Hi 16 I 17 BUSINESS ETHICS Hyundai To protect Monitoring compliance with internal standards of regulation Monitoring compliance with internal standards and investigating cases of violation Educating employees on legal compliance are Making sure in advance that normal business operations consistent with the law and the company regulation Distributing information regarding newly revised laws, agreements and regulation relevant to the insurance company Practicing business ethics Preventing money laundering THE COMPLIANCE OFFICER SYSTEM REPORTING CENTER FOR FINANCIAL ACCIDENTS AND BANK-RELATED IRREGULARITIES the customers and maintain a sound property the customers and maintain a sound a compliance management, Hyundai Marine has hired monitors officer from outside the company who which are compliance with ‘internal standards of regulation’ investigates basic procedural rules of employee’s duty and compliance cases of violation since July 2000. Here are the officer’s main tasks. Marine trains its employees on ethics regularly to prevent financial accidents and runs a website on ‘Center for Financial Accident and Bank-related Irregularities’. This is to thwart any financial accidents and unfair business as well as minimize corporate damage. It is also possible to report violations to the internal auditing department online through an on-line bank-related irregularities system. All reports are examined thoroughly and reflected in the company’s reform process and corporate management. Our CP is especially Hyundai Marine’s Executive Council nominated the compliance officer to a ‘self-compliance authority’ who monitors CP effectively. Hyundai Marine legislated ‘Compliance Rules regarding Fair trade’ to regulate fair trade activities. For employees working in areas, for example marketing area, where chances of violating the fair-trade laws remain high, two -hour training session per term are obligatory. Those officers and staff members that violate Fair Trade Laws are to be sanctioned with punitive measures in accordance with the degree of the violation. All documents relevant to CP are recorded and kept under the supervision of the compliance officer. CP : COMPLIANCE PROGRAM designed to facilitate observing fair-trade laws. To set a firm designed to facilitate observing fair-trade laws. and standard for fair trade and to promote fair competition of Hyundai transparent management, the CP was made part 27, 2001. The Marine’s management policy on December 21 century, rule of law in corporate competition has, in the this trend, we become not an option but a must. To follow CP into have taken initiatives voluntarily to integrate indispensable Hyundai Marine. In addition, CP has become the laws in minimizing corporate damage from violating Hyundai and enhancing corporate foreign confidence. below. Marine’s main activities regarding CP are described WE BELIEVE THAT TRUST IS AT THE BASIS OF EVERY RELATIONSHIP; WHETHER IT BE RELATIONSHIPS BETWEEN CUSTOMERS, SHAREHOLDERS OR EMPLOYEES. TRUST IS WHAT PROPELS ‘SUSTAINABLE MANAGEMENT’ WHICH MAKES HYUNDAI MARINE THE NO.1 NON-LIFE INSURANCE COMPANY IN THE COUNTRY AND GLOBAL COMPANY. WE BELIEVE THAT THIS IS THE DIFFERENTIATED BLUEPRINT FOR HYUNDAI’S FUTURE. TRUST US. AND FOLLOW US. HYUNDAI MARINE IS PAVING THE ROADS TO TRUST EVEN AT THIS VERY MOMENT. SUSTAINABILITY MANAGEMENT Sustainability Management Model Highlights in 2004 and 2005 Management Innovation Management Performance Risk Management Innovative Management Economy People Customer MANAGEMENT SUSTAINABILITY Shareholder Environmental Protection Environmental management Environment Fostering talents Premium-quality products and service Corporate social responsibility Social Hyundai Marine’s sustainability management attempts to draw result from the triple bottom management attempts to Hyundai Marine’s sustainability SUSTAINABILITY MANAGEMENT MODEL MANAGEMENT SUSTAINABILITY Management Sustainability with the stakeholders relationships for Strengthening line consisting of economic, environmental and social dimensions and strengthen the relationships among and strengthen the relationships environmental and social dimensions line consisting of economic, balanced stakeholders. We intend to achieve and employees who are main customers, shareholders by reach environmental and social, and there stakeholders on all three levels, economic, development with industry and become a global company. the top in the insurance

HYUNDAI MARINE SUSTAINABILITY REPORT 2004-2005 Be The Hi 20 I 21 SUSTAINABILITY MODEL Industry and Energy Korea Standards Association Earned BBB-stable credit rating from S&P Company in the 2005 Korea Awarded Grand Prize, insurance division, Highest-ranking Consulting HiCar, 1st place in GCSI, Japan Management Association Korea Economic Daily) Awarded Grand Prize, Korea’s Best Brand (The Awarded Excellence in Compliance Program in Financial and Insurance Sector Compliance Program in Financial and Insurance Awarded Excellence in Campaign ‘A Share Bazaar with Hyundai Marine’ Hosted Hyundai Marine with Hyundai Marine’ Campaign ‘A Beautiful Blood Donation Drive Hosted Hyundai Marine Customer Satisfaction, Insurance Division, Korea Awarded Grand Prize in business ethics handbooks Issued and distributed Marketing Business’ to the insurance agents Presented and offered ‘Hi-Five Codes of Right Service Quality Assessment, Awarded 2nd place in non-life Insurance division, Customer Satisfaction Index Awarded 2nd place in Insurance division, Korea three consecutive years Selected one of 15 Best Companies to Work for Contest Attestation of Best Practice, Korea Best Practice Spirit Opened Hi E&C Forum of Ethics and Law-abiding Insurance Awards Won Innovation Prize, the 9th Herald Business Best for two consecutive years Earned A-(Excellent) insurance rating from A.M. hosted by the Ministry of Commerce, Recipient of Korea Service Quality Certification, Service Satisfaction (The Korea Times) 2004. 11 2004. 12 2005. 01 2005. 04 2005. 05 2005. 06 2004. 10 2004. 04 2004. 05 2004. 06 2004. 08 2004. 03 HIGHLIGHTS IN 2004 AND 2005 2004 AND IN HIGHLIGHTS Along with ‘Hi 2010, the most competitive Organization for Six Sigma Project REDUCTION IN COST AND IMPROVEMENT IN REDUCTION IN COST AND IMPROVEMENT SIX SIGMA CUSTOMER SATISFACTION THROUGH ACTIVITIES insurance company in Korea’, Hyundai Marine has been insurance company in Korea’, Hyundai Marine tackling promoting the ‘Six Sigma Project’. We are finally aware of but various problems that we had previously been our cost and did not have the resources to resolve, reducing From a fostering talents as part of innovative transformation. 290 billion total of 59 reform project, we are anticipating are KRW in profit. What is more, what began in headquarters and thereby now being implemented in regional offices On a slightly upholding the company-wide innovation. Practice in different note, Hyundai Marine was awarded Best to which the Korean Reform Skill Contest in October 2004 Sigma project company submitted a part of from the Six mail delivery. with a theme of reducing the return rate of Tracking We plan to continue our work with the Project select project System and secure an improved ability to through our connection with BPR. Upon powerful management innovation powerful management Following the announcement of Vision Hi 2010, Hyundai Marine has been engaging in activities of Vision Hi 2010, Hyundai Following the announcement SECURING FUTURE COMPETITIVENESS THROUGH SECURING FUTURE COMPETITIVENESS MID TO LONG-TERM STRATEGIES MANAGEMENT INNOVATION MANAGEMENT through Competitiveness Enhancing involving Six Sigma. This was witness to Hyundai Marine’s intention to resolve problems step by step, intention to resolve problems step This was witness to Hyundai Marine’s involving Six Sigma. in has been trying to encourage innovation its dreams. At the time, the company foster talents and realize the rapidly- permeating the industry and adjust to to overcome the uncertainties the management process countless that we will not hesitate to undertake management. We promise you again, changing business your expectations. reforms to meet satisfy announcing our motto ‘Hi 2010, the most competitive announcing our motto ‘Hi 2010, the most strategies insurance company in Korea’ in 2003, we devised It is to take the lead in changing market environment. future of the becoming clearer day by day that the bleak due to insurance industry, in the long-term, remains by new intensification of competitiveness caused such as competitors and introduction of new channels bancassurance. to long-term As a response, Hyundai Marine formulated mid Currently, policies to prevail over this transitional period. outstanding Hyundai Marine is delivering visible and performance in new market areas such as bancassurance.

HYUNDAI MARINE SUSTAINABILITY REPORT 2004-2005 Be The Hi 22 I 23 MANAGEMENT INNOVATION To provide an opportunity to run an efficient What is Six Sigma? Hyundai Marine has been trying to revolutionize its management Hyundai Marine has been trying of Six Sigma since the latter method through the implementation to realize ‘Vision 2010’ by building a half of 2003. Part of this was help the company achieve its goal. A concrete structure that will the company’s long-term ideal and the vision can be understood as a way of realizing the company’s company’s long-term strategies, long-term ideal are, in essence, the vision. The details of this including increasing business problems that need to be addressed sales and efficiency, reducing the operation cost, increasing these fulfilling customer satisfaction. Figuring out how to solve problems is what we call Six Sigma. & The sequences of Six Sigma is define, measure, analysis, improve without a control. The problems that Six Sigma deals with are those but not clear source of origin and those that are resolved temporarily for fundamentally. Six Sigma is a comprehensive mechanism then problem resolution beginning with defining the problem, analysis analyzing the reasons behind it through a scientific followed by improving weaknesses. knowledge management, Hyundai Marine created knowledge management, Hyundai Marine as a ‘Information-Sharing and Utilizing System’ our hands at management policy in 1999. We also tried information various methods including establishing an system, our management system, converting a notes system. internal group wear, to a knowledge management To demonstrate our effort, we began focusing on reconstructing the groupware in December 2001 and developed k-Mart in a form of portal. In June of the following year, we upgraded the notes system to ‘Hi-Me’ and thereby presenting a new form of knowledge management. Hyundai Marine’s organized and specialized knowledge management has displayed visible results such as eliminating the inefficiency of repeating the same task or impeding work due to lack of knowledge. Along with this, we have made the capacity to carry out duties uniform across all departments by developing ‘Sharing System according to Job Functions’ which allows persons-in-charge to have access to answers to problems that they simultaneously face. In addition, Hyundai Marine opened ‘Hi-community’ within company intranet called ‘Hi-me’ in June 2003 to make public and discover voluntarily the knowledge, experiences and know-how of employees while maximizing the results. Result billion won billion won billion won billion won 1.3 7.4 20.5 29.2 8 23 28 Subtotal - 8 8 Regional headquarters Agenda - 2 3 Following the first stage of Six Following the company Subsidiary 8 17 40 5 16 59 13 ters Headquar Knowledge management is a reliable source for Knowledge management is a reliable source Total 2003.08~2004.01 2004.04~2004.08 2004.11~2005.03 Period for the project st rd nd 1 3 2 tion The results for the second and the third stage are estimates. Classifica _ ’Hi-Me’ website screen(groupware) MAKING KNOWLEDGE MANAGEMENT PART OF MAKING KNOWLEDGE MANAGEMENT LIFE *The results of the first stage has been verified by the company. *The results of the first stage has been verified by the company. SIX SIGMA RESULT SIX SIGMA acquiring competitiveness in the global corporate acquiring competitiveness in the global refers to an environment. Knowledge management company by enhancement of additional values of our activity that carrying out comprehensive management systems and involves enforcement of organizations, know-how of institutions based on various experiences and has been employees. Since mid-1990’s, Hyundai Marine In 2002, centralizing knowledge within the company. structure knowledge activities became possible with the development of the knowledge management system with K-Mart, the knowledge mileage program and the knowledge leader. Currently, an active sharing of knowledge among employees through online communities has become a part of everyday life for the employees at Hyundai marine. Sigma which began in August 2003 involving 8 subjects as a Sigma which began in of the project dealt with 23 model, the second stage company businesses regarding subjects in relation to and regional headquarters. Presently subsidiary companies conducted on 20 subjects with the 3rd stage is being at the headquarters and subsidiary reference to the work 8 other subjects regarding business companies as well as headquarters through the operations at regional Six Sigma. The following chart implementation of Power results of the project. describes the financial As the uncertainties of business environment grow, As the uncertainties of business environment GOVERNING COUNCIL FOR RISK MANAGEMENT Hyundai Marine is forming an structured organization for Hyundai Marine is forming an structured organization Council comprehensive risk management. The Governing the Executive for Risk management is a sub-council within regarding risk Council which has the rights to make decision risk management. It is in charge of comprehensive management and supervision tasks such as establishing risk management policies and strategies and setting up, managing and assessing risk limits. There is also a Claims Division which only deals with risk management. As an organization which oversees risk management and provides assistance to the Governing Council for Risk Management, Claims Division gathers, analyses, measures, and reports risks, formulates responses to the risks and improves risk management related regulations and system. All other departments, as departments in charge of actual risk managemen, codify regulations and procedures for public ownership within the company and gains sufficient understanding of the purpose and procedure of risk management and carries out the appropriate duties. Development of ALM (August 2001) Our risk management focuses on constructing a sound financial structure and promoting a and promoting a sound financial structure on constructing focuses Our risk management company’s risk management. Guiding through all types of work by codifying general principle and methods of management regarding the Guiding through all types of work by codifying general the works being carried out under the regulations by following the ’Risk Management department inspects regularly Development of Market VaR (August 2001) Upgrading ALM System (January to December 2004) Legislation of Risk Management Regulations Regulations Monitoring Compliance with Risk Management Development of Risk Management System risk management check list and encourages rooting of risk management tasks within the front-line operations risk management check list and encourages rooting departments. ■ ■ ■ Risk Management Activities RISK MANAGEMENT RISK Risk Management Organization secure growth by managing and restricting risks which can occur at any time comprehensively and can occur at any time comprehensively managing and restricting risks which secure growth by corporate short-term and to come up with a solid is to provide maintain security in the consistently. Its goal of involves clarifying the duties and responsibility the long-run. Risk management also image and value in the future. danger in the present time as well as measuring and restricting potential each department and loss and risk management minimizes potential growth and profit-making tendencies, While increasing the become the risk management, we will management. Through our comprehensive enables sustainability the values of the stakeholders. company and devote ourselves to advancing premium insurance

HYUNDAI MARINE SUSTAINABILITY REPORT 2004-2005 Be The Hi 24 I 25 RISK MANAGEMENT risks set up share possession limit support management decision Underwriting refers to the process of assessing the Underwriting refers to the process of assessing Hyundai Marine operates a risk management system to operates a risk management Hyundai Marine Measurement and management of interest risk Measurement and management Produce future B/S, P/L Measurement of market risk insurance risk measurement system planned hereafter insurance risk measurement system planned ALM System (built August 2001, upgraded January ALM System (built August 2001) Market Risk Management System (built August and Construction of credit risk measurement system 2005) Status and Use of Main System Status and Use of Main Strategic asset distribution ■ ■ ■ ❷❸ ❹ ❺ ❶ results of ALM System by an index such as VaR Department and the Internal Auditing Department Insurance Risk : deciding appropriate possession level Insurance Risk : deciding of liabilities derived from Interest Risk : interest-period Market Risk : management centered on limits determined Credit Risk : management based on credit limit, Management Ris k : management based on Compliance through the number of people and reinsurance strategies through the number of people possession limits of individual companies Risk Management Activities Gathering of accurate information Regulation on undertaking Deciding whether or not to undertake and the conditions for undertaking Concluding an insurance agreement Deciding possession quantity of insurance and entering reinsurance RISK MANAGEMENT BASED ON UNDERWRITING POLICY RISK MANAGEMENT BASED ON UNDERWRITING A COMPREHENSIVE RISK MANAGEMENT SYSTEM RISK MANAGEMENT A COMPREHENSIVE Underwriting Procedure ❷ ❸ ❹ ❺ ❶ provide a measurable concept and an appropriate framework for thinking which enables the company to face risk management which enables the company to face risk and an appropriate framework for thinking provide a measurable concept from view. We are supplied with effective countermeasures response from a comprehensive point of with scientific and effective of risks. system in accordance with types of knowledge through the operation of risk management acquisition and analysis insurer’s risk of undertaking, deciding whether or not he or she will undertake and determining the conditions and the insurer’s risk of undertaking, deciding whether aims to decentralize risks by choosing high-quality risks and securing sufficient possession quantity. Our Underwriting Policy of Hyundai Marine’s underwriting policy lies in effectively distributing premiums. Prioritizing profit and loss, the principle huge losses such as cases of Personal liability claims, Natural disaster-induced with reference to mortgages likely to incur coverage. In particular, Hyundai Marine created a database that stores the damages to automobiles, all of which have unlimited as insurance criminal, those that habitually violate major regulations and cause names of those who should be mindful of such, Since 2003, Hyundai has been running an ‘Automated Underwriting System’ accidents to make wises choices in undertaking. undertaking depending the risk of a contractor and the level of premiums. which automatically decides on the matter of HYUNDAI MARINE IS LIKE A RAY OF SUNSHINE TO THOSE WHO ARE GLOOMY, DISHEARTENED AND THE RESTLESS. WE PROMISE YOU ONLY THE BEST, WHETHER IN PRODUCTS OR IN SERVICE. TRUST US AND ASPIRE FURTHER. WITH HYUNDAI STANDING BEHIND YOU, YOU HAVE NO WORRIES. OUR CUSTOMERS Best Products & Services Warranty Convenience for Customers Communication with Customers Protection of Customer Information In following the _ website of online insurance transaction ONLINE INSURANCE TRANSACTION FOR THE ONLINE INSURANCE TRANSACTION CONVENIENCE OF CUSTOMERS popularity of online transactions, we have witnessed a rapid popularity of online transactions, we have witnessed of insurance increase in online registration and purchase Hyundai products. For the convenience of customers, system. All Marine runs an online insurance transaction subscription, customers can subscribe and cancel, change for insurance inquire, take out loans, also make a claim payment online. when entering into a First, contract, we abide by ‘3 fundamental principles’; signing in person, duplicating contract and deliver provisions and explaining main content) to Best Products & Services Products & Best We run various programs to help entering Hyundai Marine gives its best to guarantee the customer’s property and safety and to offer its best to guarantee the customer’s Hyundai Marine gives Hyundai Marine devised a company check-list to Hyundai Marine devised a company check-list we have set up a website to provide our customer SYSTEM FOR CONCLUDING A FAIR INSURANCE CONTRACT BEST PRODUCTS & SERVICES & PRODUCTS BEST Offering better products in accordance with the customer’s needs. We consistently develop new products that are in We consistently develop new products with the customer’s needs. better products in accordance along with we are able to offer risk insurance environment and various risks so that line with changing attention to few insurance companies which pay service. We are one of the differentiated risk management was the satisfaction. For instance, Hyundai Marine and focus our business on customer the customer’s need Customer Satisfaction. companies to declare a Charter for first among insurance confirm regularly the regulations on insurance business in confirm regularly the regulations on insurance (such as times of product development and alteration business plan, insurance policy, and standard computation method of insurance premium and liability reserve). Third, with ample information on our products in accordance with regulations on public notice with regard to products legislated by the supervisory authorities. into fair contracts with customers. the signing of minimize any customer satisfaction following the contract a contract. In case the obligations under cancel the remain unfulfilled, we allow customers to full amount. contract and refund the insurance payment in Second,

HYUNDAI MARINE SUSTAINABILITY REPORT 2004-2005 Be The Hi 28 I 29 BEST PRODUCTS & SERVICES Hyundai Marine is always Our ‘Hicar Automobile Insurance’ is composed of three Our ‘Hicar Automobile program; first, ‘Hicar Weekend different types of insurance ‘Hicar Family Automobile Insurance Automobile Insurance’, Automobile Insurance.’ and ‘Hicar Personalized Hicar Direct Insurance Hicar Direct Insurance Hicar Personalized Insurance with free choices of Hicar Personalized Insurance with free choices Personalized guarantee needs. It This product is designed to suit all your and assesses your driving skills and risks involved It was includes basic as well as additional coverage. borne out of circumstances in which the automobile and insurance failed to cover the costs of accidents fee upon ended up incurring a large amount of damage from a the insurer. Our customers will be able to benefit for you product that offers best insurance conditions and your automobile. developing new insurance products to suit your needs. developing new insurance has been available online since Hicar Direct Insurance which that is September 2004 is a new type of insurance product same time, both convenient and economic and, at the quickly adopt allows easy subscription and cancellation. To constantly to the changing insurance market, we are products that devoting ourselves to producing insurance are convenient and reasonably priced. Since free-pricing of Hicar Family Automobile Insurance with strengthened protection for Families This is geared toward those with families and covers the insurer as well as the insurer’s family members and also provides insurance for walking accidents. It provides a maximum of 200 million KRW in accordance with payment standards written in the provision, regardless of the insurer’s negligence. Hicar Weekend Automobile Insurance that is Hicar Weekend Automobile Insurance that perfect for the ‘Monday through Friday work schedule’ trend of today’s society more on This is a product for those who drive much of the weekends than weekdays since the launch opening nationwide 5 work day program along with the of of a new highway which revolutionized the concept the weekend and leisure. This product revolutionized coverage concept of weekend by defining the weekend the as starting from Friday 6pm. It also strengthened insurance coverage on Saturdays and Sundays. In particular, this product provides twice as much compensation as weekdays in cases of death or physical impediment. Since the chances for injury remain higher than chances for death, the coverage includes compensation, amount of damages incurred through suspension of businesses, outpatient expenses and maximum of 2 million KRW ‘financial aid for accidents occurred over the weekends’. Hicar automobile insurance Hicar automobile insurance CUSTOM-MADE INSURANCE PRODUCTS TO SUIT THE NEEDS OF OUR CUSTOMERS THE NEEDS OF OUR PRODUCTS TO SUIT INSURANCE CUSTOM-MADE automobile insurance in 2000, Hyundai Marine has been automobile insurance highquality automobile insurance working to create a claims service offered at a product with differentiated Hyundai Marine won Grand Prize reasonable price. In 2000, Selection (hosted by Maekyung in the ‘Financial Product insurance product ‘For You Daily) for our high-quality which covers the insurer as well as Automobile Insurance’ in accidents. In the following the insurer’s family member Insurance’ year, we came up with ‘New Auto Automobile over new cars. which strengthened the insurance coverage was In 2002, our ‘New Business Automobile Insurance’ Hyundai received warmly by our customers. In addition, in Marine developed ‘Hicar Automobile Insurance’ and has accordance with the life style of our customers been selling them since July 20, 2004. ll Hyundai Marine concentrates on manufacturing products that not only take products concentrates on manufacturing Hyundai Marine Private medical insurance which includes all medical expenses regardless of injuries and illnesses Saving high rate tax gains for retirement plans and to make up for insufficient pension Saving high rate tax gains for retirement plans and private nursing service until the age of 80, covers CI(critical illness), injuries and illnesses private nursing service until the age of 80, covers Age 15-50 Over 18 years of age Age 20- 55, those who are in good health Pays all expenses including portions not covered by National Health Insurance Includes both health and cancer insurance Strengthens coverage regarding main illnesses, 7 main illnesses and 16 main illnesses Covers all medical expenses ranging from diagnosis, operation, nursing and visits to hospitals Selected candidates under Tax Exemption Restriction Law Selected candidates under Tax Exemption Restriction payment (limited to 2.4 million KRW) Income deduction for the full amount of insurance Savings only without risk insurance the customer’s needs Options for necessary risk insurance according to the age at which pension begins and pension payment period Various designs for products such as payment period, premium Reinstatement of contract without paying the overdue First product to specializing in CI medical expense and income compensation Life Insurance which also covers CI, long-term nursing, is paid Exemption from paying insurance fee if nursing fee loans according to Life Cycle Adjusting insurance period, payment period and Who : Description : Benefits : Who : Description : Benefits : Who : Description : Benefits : ■ ■ ■ Nonparticipating Insurance, HiCare Medical Insurance Pension Savings Insurance , Loving Life after Retirement Insurance Pension Savings Insurance , Loving Life Nonparticipating Insurance, Good and Good CI Nursing Insurance Nonparticipating Insurance, ■ ■ ■ ■ ■ ■ PRODUCTS WITH SOCIAL INFLUENCE PRODUCTS into account customer’s needs and safety but also environmental and social impact. The problem of aging society, in particular, social impact. The problem of aging society, needs and safety but also environmental and into account customer’s Nursing public guarantee system. These products include more products dealing with retirement and has forced us to provide insurance plan with Altzheimer’s disease, pension savings who are living alone or bedridden and those Insurance for the elderly aged. We wi which lessens the medical expense for the after retirement and private medical insurance to maintain a quality life in environmental and social development. continue to show interest

HYUNDAI MARINE SUSTAINABILITY REPORT 2004-2005 Be The Hi 30 I 31 WARRANTY 59 24 13 11 11 25 23 Seoul Incheon Daejeon Gwangju Daegu Ulsan Busan EARNING ISO9002 In January 1997,Hyundai Marine became the first insurance company in Korea to be awarded ISO9002 which approved the uniform quality of Hyundai Marine’s claims service across time, place and personsin-charge. _ Survey of Current Situation of the Hicar Service Network This system computerizes all stages _ Directions Card for Overseas Emergency Support Service A-CAPS SYSTEM of insurance coverage beginning with accident registration to follow-ups. It is often credited for completing a comprehensive and logical model for an ideal claims service. Furthermore, we believe that this system is more than a computerized service; it is a testament to our dedication to satisfying our customers. This is for We run an For those traveling to HiCall Emergency Rescue Service, Emergency Towing Service, Emergency Refueling Service, Battery Recharging Service, Auto-lock disabling Service, Emergency Service for Overheated Engine, Tire Change Service HiChange Light bulb change service, Fuse change Service, Radiator Cap Change Service, Radiator Cord Change Service, Thermostat Change Service, Clamp Repair/Change Service HiClinic Automobile Diagnosis Service, Maintenance Record Management Service, Repaired Car Transport Service, Car Maintenance Reservation/Agency Service We take care of investigation, We dispatch emergency service This product offers total service which adds to standard automobile insurance, vehicle diagnosis, service which adds to standard automobile This product offers total HiClinic Hyundai Marine makes significant improvements based on differentiated claims service process claims service based on differentiated improvements makes significant Hyundai Marine HiCall HiChange WARRANTY Overseas Emergency Support Service Mount Kumkang Claims Service Service for Minor Damage Summer/Winter Mobile Claims Service TYPES OF CLAIMS SERVICE Hicar Dispatch Service HICAR SERVICE and customer feedback. The newly devised concept of before and after service in our ‘Hicar Service’ before and after service in our ‘Hicar The newly devised concept of and customer feedback. adequate provides efficient claims service with in every aspect and successfully product was revolutionary accidents. measures to prevent automobile maintenance, repaired automobiles and etc. Hicar Service works from three dimensions, HiCall, HiChange and works from three dimensions, HiCall, repaired automobiles and etc. Hicar Service automobile maintenance, accidents. network service and prevent and follow-up HiClinic to establish a nationwide 24/7, anytime anywhere and takes care of all matters related to 24/7, anytime anywhere and takes care of all matters subscription’. the accident including issuing ‘proof of insurance within 10 We have over 450 employees to be dispatched of reaching minutes of the call nationwide. With 46.5% chance system, accident sites within 10 minutes using location tracking we provide fastest dispatching service in Korea. accidents and repair fees without requiring you to purchase insurance. We intend to lessen the burdens incurring from minor accidents and assist customers who try to avoid insurance. Mount Kumkang, we provide claims service for entering special areas (North Korea). This includes safety management and emergency dispatch in case of an accident. We also conduct regular inspection on safety issues. Also, we were the fist ones to introduce traveler’s payment guarantee service for hospitals and doctors in Sokcho City. emergency dispatch system in response to incidents in places of recreation, highway and remote places. accidents happening while traveling abroad covering medical payment guarantee service, Korean language service and other necessary services. By To provide consistent and To promote CS with regard to FREE LEGAL AND TAX CONSULTING SERVICE MOBILE PHONE ACCIDENT REGISTRATION PROBLEMS SYSTEM FOR THOSE WITH SPEECH This enables people with hearing or speech problems make reports through Mobile Phone SMS and request emergency dispatch service in case of emergency. CS EDUCATION HI-CLASS SERVICE corporate customers and other related companies and improve Hyundai Marine’s image, we send CS lecturers for education and training sessions. differentiated service to our VIP customers, Hyundai Marine differentiated service to our VIP customers, Hyundai includes full offers specialized personalized service which cake claims service and side benefits such as birthday oil exchange delivery, free regular inspection, engine year gifts, certificate, delivery of Hanwoori, end of the reduction of credit loan interest. offering a 1:1 consultation with a specialist, the customers offering a 1:1 consultation with a specialist, such as are able to deal with problems outside insurance instance, car those regarding civil and criminal law, for debts and tax accident, divorce, inheritance, bonds and tax, issues including transfer income tax, acquisition and value- inheritance tax, donation tax, corporation tax added tax. for Customer Satisfaction for Customer 365 days 24 hour service, Hyundai marine engages in differentiated service which enables us to satisfy needs of every in differentiated service which Hyundai marine engages Customer Service CONVENIENCE FOR CUSTOMERS FOR CONVENIENCE Service Customer ■ CUSTOMER CALL CENTER customer. We aim to not only satisfy but impress our customers with highest-quality they could find in the with highest-quality they could not only satisfy but impress our customers customer. We aim to insurance market. the Customer Call Center is in charge of automatic services the Customer Call Center is in charge of automatic reissuing including registration and claims consultation, request. proof documents and emergency dispatch service operates In case of automobile insurance, the call center registration, basic operations including 24 hour accident consultation and car rentals.

HYUNDAI MARINE SUSTAINABILITY REPORT 2004-2005 Be The Hi 32 I 33 CONVENIENCE FOR CUSTOMERS Along with risk Consultation on Comprehensive Risk Countermeasures Report We also assist our customers in estimating the amount of We also assist our customers in estimating the Insurance Management Consulting reference to We have designed an ideal insurance program with to our potential risks in work sites. We offer consultation customers regarding this issue. Calculation of Largest Estimated Loss INSURANCE CONSULTING your insurance We use indirect assessment methods to evaluate assets. fees to provide insurance registration guideline for Value Program developed to We operate a computer program which we provide optimum service for insurance fee assessment. maximum lost and devising restoration schemes while maximum lost and devising restoration schemes and land considering the building structure, fire prevention distance. readjustment, fire control facilities, and segregation diagnosis, Hyundai Marine offers ideal insurance plans and diagnosis, Hyundai Marine service regarding your assets. insurance fee assessment Assessment of Insurance Registration Fee Risk Diagnosis of Work Site We invite experts We offer various services Procedure for Risk Management Service Registration and Devising a Program We provide a range of risk management service to protect customer’s life and wealth. We discover and analyze risk management service to protect customer’s We provide a range of Risk Management Service Risk Management Request for Risk Diagnosis Offering Informations of Disaster Prevention preventive We provide domestic and international disaster measures for risk management. We produce ‘Risk Diagnosis Report’ which contains analysis of We produce ‘Risk Diagnosis Report’ which contains potential risks and appropriate countermeasures. Risk Diagnosis Report Hyundai Marine sends its team of experts on risk diagnosis to Hyundai Marine sends its team of experts on risk and assess your work sites, anywhere in Korea, to discover potential risks. RISK DIAGNOSIS SERVICE RISK MANAGEMENT SEMINAR RISK MANAGEMENT ■ the customer’s risks and provide various measures to prevent damage. To help our customers, we host regular seminars on To help our customers, we host regular provide various measures to prevent damage. the customer’s risks and new information. risk management and Risk Assessment to provide appropriate risk management measures through to provide appropriate risk management measures risk assessment of the customer’s work sites. to give seminars on risk management and insurance to give seminars on Upon request of our customer, we management measures. host seminars. sometimes visit sites to Data Analysis (the Satisfaction competent dept.) Checking out VOC Results & Customer Meeting VIP Customers At our company, the deputy heads of customer center and support division at the headquarter pay visit to VIP customers in person. Every month, they select a VIP customer whom they meet personally and listen carefully to the VIP’s opinion. We see this as an opportunity to show our respect for our customers and our insurance agents. _ Managing the VOC and the VOC Inquiry Screen with Customers with dept.) (the competent Dealing with VOC We operate diverse set of programs to make our communication with Dept.) (CS Promotion VOC Distribution Hyundai Marine pays special attention to the voice of customer to improve overall service special attention to the voice of customer Hyundai Marine pays Conduct within 24hours since registration Through ‘Hi-VOC’, our comprehensive VOC system’, so on) VOC Registration (by counselor and Once a week, the CEO and all executive officers listen to COMMUNICATION WITH CUSTOMERS WITH COMMUNICATION Communications Sustaining COMMUNICATION WITH CUSTOMERS VOC Management Structure CUSTOMER SATISFACTION THROUGH VOC CUSTOMER SATISFACTION THROUGH Customer Complaint Files and make personal calls to customers to deliver a personal apology. This allows us to better understand the needs of customers and provide them with measures to restore customer confidence in our company. Handling Customer Complaint Hyundai Marine is able to deal with customer opinions Hyundai Marine is able to deal with customer centers and which have been collected by postcards, call by which homepages. In fact, we have developed a function be monitored. a call between customers and counselors can customers Thanks to this function, we are able to provide with appropriate support measures and furthermore, deliver additional since request thorough SMS and emails all within 24 hours for assistance. and satisfy the customer’s needs. Through consistent communications with customers, Hyundai Marine with customers, Hyundai needs. Through consistent communications and satisfy the customer’s be pursue We promise you that we will always to improve customer management. constantly makes efforts and provide convenience to our customers. customer satisfaction customers much more dynamic.

HYUNDAI MARINE SUSTAINABILITY REPORT 2004-2005 Be The Hi

34 I 35 COMMUNICATION WITH CUSTOMERS 71.0

2004 69.6 2003

[ IN-HOUSE INQUIRY RESULTS ] 72.5

2004 72.0 C.C.O System insurance company in Korea that Hyundai Marine is the only listen to customer complaints and makes the company’s director C.C.O (Director & Chief Customer consult with them in person. with customers through a customer Officer) are able to interact working to deal with customer hotline. We are constantly within 24 hours. requests and complaints 2003

CUSTOMER SATISFACTION

Automobile Insurance Long-term Insurance 50.4

2004 46.9

Suggestions for Reform

Coming up corresponding measures that conform with R/P Coming up corresponding measures that conform with R/P payment deriving from credit card receipt agreement. Strengthening responses regarding long-term fire insurance ‘Gas Stations Compensation’ Special Policy in Devising preventive measures regarding change of option automatic transfer of account with reference to long-term insurance Providing Measures preventing Customers’ Appeals about Arriving at the Scene of the Accident 2003 44.4

2002 40.1 2004.07.26 2004.09.08 2004.09.14 2004.09.24 Korea Customer Satisfaction Index (Korea Management Association) Date of Hosting 2001 KCSI : KCSI [ RESULTS OF THE OUTSIDE ORGANIZATIONS’ INQUIRIES ] Every year, we conduct customer surveys in and outside Korea to gain a better understanding of customer’s needs and to Every year, we conduct customer surveys in and outside Korea to gain a better understanding 1 2 3 4 Results from the ‘Customer Appeal Forum’ in 2004 Results from the ‘Customer Appeal Forum’ CSI Appeals Forum Protection Team, we analyze all issues Along with the Consumer appeal and present matters that need generated by customers’ To do so, we host ‘Customer to be addressed and improved. a conference of chiefs of competent Appeal Forum’ which is departments on regular basis. The employees at Hyundai Marine visit call centers to listen in The employees at Hyundai The deputy heads of customer and person customer complaints. visit the customer call center once a claims services department which hinder customer satisfaction and week to examine issues needs. to understand the customer’s provide better service. Experiencing Customer Call Center Experiencing Customer Technical and maintenance measures for personal information protection Link sites Postings on bulletin Consignment of personal information Rights and Duties of the User Collecting Opinion and Dealing with Complaints Persons-in-charge of personal information maintenance Personal information protection of a child Sending commercial information Obligation to Notify in the Homepage _ Private Information Protection Policy contained _ Private Information Protection Policy contained Protection Details of Personal Information Protection Policy We believe that customer details are important assets to our company and therefore take details are important assets to We believe that customer Hyundai Marine’s Personal Information Protection General Principle Range of Personal Information Collection Purpose of Personal Information Collection Consenting Personal Information Collection Use of Personal Information beyond initial purpose and the access of the third party & public access Collection of personal information by the use of cookie Perusing and correcting personal information Withdrawing consent for collection, use and providing of personal information Periods for using and retaining personal information INFORMATION PROTECTIONS INFORMATION Information Customer CUSTOMER INFORMATION PROTECTION POLICY CUSTOMER INFORMATION PROTECTION Policy defines the company’s general principles regarding Policy defines the company’s general principles while information assets and information protection We take pursuing strict customer information protection. to customers caution in providing appropriate information on our and furthermore display corresponding regulations their personal webpage to explain to our customers how taken to details and what kind of measures are being protect their privacy. extra care to ensure their security. We strictly follow the use and protection of credit information act, the use and protection of credit information their security. We strictly follow the extra care to ensure etc. utilization and information protection, information and communication network act on promotion of protect the Information Protection Policy’. To Information Technology’s ‘Personal and the Ministry of ‘Personal we have devised a program called prevent illegal release of information, customer data and our website for our employees. Policy which we have displayed on Information Protection

HYUNDAI MARINE SUSTAINABILITY REPORT 2004-2005 Be The Hi 36 I 37 INFORMATION PROTECTIONS ePrivacy mark i-Safe mark With a conviction that proper management of customer that proper management With a conviction June 2004 Head of Corporate Planning Dept., Head of Compliance Dept., Head of General Affairs Dept., Head of Head of Corporate Planning Dept., Head of Compliance Dept., Head of General Affairs Dept., Head Personnel Dept., Head of CRM Promotion Dept., Head of Informations System Dept., Head of Emergency Planning Dept. Earned ePrivacy mark and i-safe mark from the Korea Earned ePrivacy mark executive officer of personnel management and general affairs Personal information protection policy, comprehensive and Personal information protection policy, comprehensive protection, A comprehensive assessment of personal information objective assessment of the quality of personal information objective assessment of the quality of personal information maintenance system security, consume protection Purposes : Purposes : ePrivacy mark (personal information protection mark) ePrivacy mark (personal information protection i-Safe mark (internet site safety mark) appropriate measures Present Status : provides compensation Punishment in accordance with regulations on service following the deliberation of Security Committee Punishment in accordance with regulations on service following the deliberation of Security Chairperson : Committee Member : Payment of compensation if illegal leakage of contact information is verified Unjust Contract (due to leakage of contact information) Restitution Measures Verification of illegal leakage and enforcement of appropriate measures enforcement of Upon customer request for verification of illegal leakage, informing steps for verification and Prevent customer contact information leakage regulations on customer information security Entering accurate customer information by strengthening agent’s customers for the purpose of undertaking the agreement), In case illegal leakage (i.e. an agent contacts another Sanctions on the Source of Leakage : Date of Enforcement : Composition of the Security Committee : Verification of Illegal Leakage : Content : Details of Compensation : Purpose : Details of Official Marks : ■ ■ ■ ■ ■ ■ ■ Customer Contact Information Security Guarantee System Customer Contact Information Security Earning official authorization from the Korea Association of Information & Telecommunication from the Korea Association Earning official authorization Association of Information & Telecommunication in accordance with the & Telecommunication in accordance with Association of Information Network and Protection Regulations regarding Promoting Usage of Information these marks of Information. And follows the regulations regarding ■ ■ CUSTOMER INFORMATION PROTECTION SYSTEM INFORMATION PROTECTION CUSTOMER information is the basis for customer confidence, we maintain Customer Information Protection System. The maintenance of this Information Protection System. The maintenance for customer confidence, we maintain Customer information is the basis operation, and authority regarding business range of tasks including clarifying the responsibility system refers to a wide Protection to strengthen our Customer Information and training employees. We will continue regulating business provisions asset. the risk management system regarding information system and consolidate AS THE REPRESENTATIVE OF ALL INSURANCE COMPANIES IN KOREA, HYUNDAI MARINE CONSTANTLY ENGAGES IN SOCIAL ACTIVITIES WHICH CONTRIBUTE TO THE SOCIETY TO FULFILL ITS CORPORATE SOCIAL RESPONSIBILITIES. WE FIND JOY IN THE SATISFACTION OF OUR CUSTOMERS AND HAPPINESS OF THE PEOPLE. WE WILL FOSTER AN ENVIRONMENT RECEPTIVE TO ALL MEMBERS OF THE SOCIETY. LOOK AROUND YOU. COME JOIN US. WE WILL ALWAYS REACH OUT TO YOU AND YOUR FAMILY. OUR SOCIETY

Social Contribution Activities Responsibilities and Obligations to Nation and Society Setting up Crosswalk Safety lights setting up and Since 1988, beginning with Seoul, we have been country. The operating crosswalk safety lights across the as drivers the crosswalk safety lights tell pedestrians as well their cars to at location of crosswalks and helps drivers to stop and stop lights. It also brightens up areas with many crosswalks to a tells the location of the center line. In fact, according Authority, a research conducted by the Road Traffic Security by more than number of pedestrian car accident was reduced 80% since the installation of crosswalk safety lights. As of March 2005, there are now 550 crosswalk safety lights in Seoul, 500 in Incheon, 250 in Busan and 200 Kwanju. We plan to continue our work across the nation. To keep our customers safe from car accidents, we engage in To keep our customers safe from car accidents, Seoul as Corporate Citizenship as Corporate Incheon 550 500 Busan century. st 250 As an important member of the society and as a corporate citizen, we are committed to of the society and as a corporate As an important member Gwangju 200 Social Contribution Activities at a Corporate Level Social Contribution Activities SOCIAL CONTRIBUTION ACTIVITIES CONTRIBUTION SOCIAL Contribution Social Regional Status of Installation Rate [ AS OF MARCH 2005 ] VOLUNTEER WORK TO PREVENT CAR ACCIDENT ■ carrying out social responsibilities and duties. We consider social contribution activities not as a form of social contribution activities not responsibilities and duties. We consider carrying out social Building conduct required of corporate citizens. as a social responsibility and good volunteer work but prosper. in which we are able to succeed and way of expressing thanks to the society social welfare is our from the priority. We gain a sense of gratification as well as the society’s well-being is To us, the customer’s All of us at cultural and physical activities. doing volunteer work and promoting making donations, principles mirrors the corporate values and that our consistent social contribution Hyundai Marine believe as a testament to our potential to become a global insurance that govern our company and serves company in the 21 various programs to raise traffic awareness.

HYUNDAI MARINE SUSTAINABILITY REPORT 2004-2005 Be The Hi 40 I 41 SOCIAL CONTRIBUTION ACTIVITIES in Car accident is a frequent source of unhappiness in family life. Car accident is a frequent source of unhappiness The sole ‘vehicle maintenance program’ in the insurance industry The sole ‘vehicle maintenance program’ in the assessment and makeshift measures Program content: car maintenance, car trouble Four times per year Place : Hyundai Car Southern Office (Seoul) Total 2,380 February 1997 to March 2005 (total of 65 sessions) Women Drivers For Period presents on various occasions (birthdays, holidays, entrance congratulations and consolation payment attending graduation ceremony monthly scholarship payment summer camps bonus payment in case of flood Main Activities Number and graduation ceremonies, Children’s Day and Christmas) Description ■ ■ ■ ■ ■ ■ of Participants VOLUNTEER WORK TO PREVENT CAR ACCIDENT Setting up Crosswalk Safety lights Setting up to teach women drivers what to do in This program is designed It provides basic knowledge of car the case of emergency. driving safety. We launched this maintenance to enhance with Hyundai car. It is the only car program in 1997 in association open to public. As of March 2005, maintenance training program in our program which is held 2,380 people have participated provides information on car quarterly. The program assessment, makeshifts measures and maintenance, car trouble and car accidents. what to do in case of emergency It has been estimated that while 95% of children in average families go onto middle and high schools, only 60% of children It has been estimated that while 95% of children beyond elementary school. This shows how car accidents can ruin family life and suffering from the ills of car accidents pursue the children suffering from the ills of car accidents. furthermore, ignorance of the society regarding its efforts to raise traffic awareness and to provide assistance to those children In this regard, Hyundai Marine makes best of need. Beginning in 1996, every Hyundai Marine employee contributes a fixed amount from his or her monthly payment and need. Beginning in 1996, every Hyundai Marine As of 2005, we have been engaging in ‘Loving Odds and Ends’ Campaign bonus to a fund which is delivered to the children. graduation, entrance, New Year’s Day and Thanksgiving presents to a total which gives monthly scholarships as well as birthday, tend to be sensitive and vulnerable, we also offer summers camps and other of 24 children. Given that most of these children events every year to help them mentally and emotionally. Starting with our sponsorship during the 1988 Seoul _ An event of the ‘Beautiful Store’ All Hyundai Marine officers voluntarily give up a fixed All Hyundai Marine officers payment to help the children portion of their monthly car accidents and any of those who have suffered from who are in need. Beautiful Store public event called In 2004, we hosted a large-scaled association with a non-profit the ‘Beautiful Store’ in goes by the name, ‘Beautiful organization which also from selling donated goods. Store’ which raises funds donated by our employees About 36,000 goods were The and were sold through the ‘Share Bazaar’. to revenues garnered from the sales were all donated the funds that are solely used to help the needy. ‘Promise to Share Love’ fundraising campaign the During ‘2004 Awards of the Year’, our officers and of insurance agents raised funds and wrote message the hopes which were then delivered to ‘World Vision’, organization for social contribution activities. ‘Loving Odds and Ends’ Campaign ‘Loving Odds and Ends’ facilities 54% Every year, social welfare 2004 [ USE OF DONATION ] CONTRIBUTION TO CULTURAL AND SPORTS ACTIVITIES VARIOUS DONATION ACTIVITIES VARIOUS scholarships Support for Various social parties Hyundai Marine participates in donation activities to help Hyundai Marine participates of natural disasters, to help the the poor and, in times only send funds but also carry out victims in need. We not to improve the society and raise various non-profit activities our employees. social awareness among 45% 1% Olympics, we have been active in various cultural and sporting events. Since May 1989, we have been supporting a tennis team Olympics, we have been active in various cultural and sporting events. Since May 1989, we a professional baseball team which has produced good results in many tennis tournaments. We also have been sponsoring quality of pro-sports in Korea which called ‘Hyundai Unicorns’ since 1996 through which we have made efforts to enhance the have been sponsoring motor racing has been behind in North America and Europe. To popularize the lesser-known sports, we competitions as well as women’s professional basketball since 2001.

HYUNDAI MARINE SUSTAINABILITY REPORT 2004-2005 Be The Hi 42 I 43 SOCIAL CONTRIBUTION ACTIVITIES d in Hyundai Marine strongly encourages Consisting of 480 female employees within Seoul ONE HEART GROUP’S SOCIAL CONTRIBUTIONS NEW EMPLOYEES’ SOCIETAL CONTRIBUTIONS ACTIVITIES (headquarters, Kangnam and Kangbuk offices), Hyundai (headquarters, Kangnam and Kangbuk offices), in 1996 to Marine One Heart Group was established Korea and to organize various social activities in and outside employees. In develop a sense of community among the in sales 2004, the members of the One Heart Group assisted donations to during the Beautiful Store Bazaar and delivered 20 elders who live alone. Moreover, they visited social welfare centres such as Hyanglimwon to deliver goods and share fellowship. On holidays, they host various events such as ‘Sharing the Cookies of Love’ to help less fortunate neighbours. new employees to engage in social activities. Each year, new employees visit social welfare centres in Kyunggido to clean, provide meals, deliver mail and participate in various academic programs during the training session. Bearing in mind the ideas of Bearing in mind the Social Contribution Activities of Officers and Employees of Officers Activities Social Contribution ■ ACTIVITIES OF ALL SOCIAL CONTRIBUTION EMPLOYEES Paju, ‘Hyanglimwon’ in Kwanju, Kyunggido, ‘House of Peace’ in Ansan, ‘Kyungdongwon’ in Suwon and ‘Jahaewon’ in Pochon, all Paju, ‘Hyanglimwon’ in Kwanju, Kyunggido, ‘House welfare associations with whom we have remained in close contact. Our ultimate of which have been recommended by social beyond material goods and funds, we aim to become a socially responsible an goal in these social contribution activities extend those who are shunned and spreading hope and love to those who are less reliable company we claim to be by helping Service corps’ officially in 2006 and to expand the areas of activity. fortunate. We plan to dispatch ‘Hyundai Marine We sponsor a total of 27 welfare centers, 5 in Kyung-in area and 22 in the provinces. These centers include ‘Paju Day-nursery ‘ We sponsor a total of 27 welfare centers, 5 in independence, creativity and trust in the development of independence, creativity up with ‘Company-wide Societal our company, we came to celebrate our 50th anniversary. To Contribution Activities’ to participate in social activities encourage our employees of unity, each department elects a and to cultivate a sense who receives a company credit in social contribution leader Marine Human Resource accordance with ‘Hyundai place both Development System’. These activities take headquarters within the national capital area and regional areas simultaneously in an organized fashion. ‘National Vehicle Maintenance Training Programme for Women Drivers’ ‘National Vehicle Maintenance Training Programme th Hosted Hicar Women Drivers’ Class Hosted ‘A Beautiful Blood Donation Drive with the Hyundai Marine’ ’Stop car accident’ campaign Traffic Safety Program in Mt. Kumkang area Fundraising Campaign for North Korean Children Hosted One Heart Group’s ‘One-day Beer House’ Event Trained persons-in-charge of all departments in the Social Contribution Activities Delivered funds that were raised during the Fundraising Campaign for North Korean Sponsored International Fireworks Festival in Seoul Sponsored International Fireworks Festival in in the Kimhae region Dispatched emergency service to flooded areas while driving’ campaign Launched a nationwide ‘Turn on your headlight ’Turn campaign on your headlight while driving’ Hicar Women Drivers’ Class over the Thanksgiving holidays A Highway Tollgate Traffic Safety Campaign for flood disasters Donated to National Damage Aid Association Hosted Hicar Women Drivers’ Class Provided a free vehicle inspection service to flooded areas Hosted ‘Share Bazaar with the Hyundai Marine’ Hosted the 26 Donated fans to Suwon Prison with 14 police headquarters nationwide Launched a Traffic Safety Campaign in association Thanksgiving Traffic Safety Campaign World Cup volunteers Dispatched 30 Hyundai Marine employees as a home for the elderly Donated humidifiers to ‘The House of Little Anna’, One Heart Group visiting ‘Hyanglimwon’ for Women Drivers in Seoul Hosted a Vehicle Maintenance Training Programme the World Cup, Kyungnam Headquarters Hosted a Children’s Drawing Contest to benefit Hosted One Heart Group’s ‘One-day Beer House’ Event. Hosted One Heart Group’s Provided a vehicle maintenance training for women drivers nationwide Provided a vehicle maintenance ‘Museums that Visit You’ Donated vehicles to the Children to North Korea 2004. 03 2004. 06 2004. 09 2004. 09~10 2004. 12 2005. 03 2002. 05~06 2002. 08 2002. 09 2002. 11 2003. 06 2003. 09 2003. 09~10 2001. 06 2001. 07 2001. 09 2001. 10 2001. 11 2001. 12 2002. 03 2002. 05 2000. 04 2000. 04~09 2000. 09 Chronology of Hyundai Marine’s Social Contribution Activities Social Contribution Hyundai Marine’s Chronology of ■

HYUNDAI MARINE SUSTAINABILITY REPORT 2004-2005 Be The Hi 44 I 45 RESPONSIBILITIES AND OBLIGATIONS TO SOCIETY 4,218 3,768 Local Tax 3,463 National Tax Hyundai Marine, at all times, fulfills its obligation to pay tax and carries out all kinds of out all kinds to pay tax and carries fulfills its obligation at all times, Hyundai Marine, Corporate Tax 19,888 4,297 Others 10,791 2002 2003 2004 Unit : One million wons Amount paid to Public Interest-related Businesses Amount paid to Public Interest-related Unit : One million wons, As of Fiscal Year 2004 Taxes paid to the Central and the Local Government Taxes paid to the Central and the Local RESPONSIBILITIES AND OBLIGATIONS TO SOCIETY TO AND OBLIGATIONS RESPONSIBILITIES charity activities regarding Public Good in the Insurance Sector. In 2004, we paid a total of 35 billion won Sector. In 2004, we paid a total of 35 Public Good in the Insurance charity activities regarding tax and 4.3 19.9 billion won for corporation of 30.7 billion won for national tax including for tax : a payment program. developing a car accident prevention tax. Currently, we are investing in and billion won for local crime accident prevention program, insurance on our public service such as car We have been working by 10% we have been increasing the budget management investigation all for which prevention and risk each year. IN 1995, HYUNDAI MARINE BECAME THE FIRST TO ENTER UNEP FI(FINANCE INITIATIVE) AND THEREBY BECOMING THE LEADING INSURANCE COMPANY IN ENVIRONMENTAL PROTECTION AND ENVIRONMENTAL MANAGEMENT. WE ARE ALWAYS A STEP AHEAD IN FOLLOWING CLOSELY THE CLIMATE CHANGES AND THE PROBLEMS OF ENVIRONMENTAL POLLUTION WHICH INCREASE THE CHANCES OF RISK. PLAN YOUR FUTURE WITHOUT WORRYING. WE WILL ALWAYS BE BESIDE YOU. OUR ENVIRONMENT Environmental Protection Activities Environmental Management 2003 _ Reference : Swiss Re sigma 2004-1 2002

2000

1998

1996

reason behind natural disasters, an increase in the number reason behind natural disasters, an increase impact on the of natural disasters clearly has an enormous Hyundai amount of insurance payment. In this sense, of the Marine pays close attention to the problems and risk greenhouse effect and strives to produce products and to management measures to confront climate changes come up with natural disaster prevention. 1994

1992 for sustainable development for sustainable 1990

Unit : Cases 1988

1986

1984

As the result of the 1982

1980

1978

1976

1974

Given that climate change and environmental pollution exercise great influence over risks and and environmental pollution exercise Given that climate change 1972

1970 150 100 50 0 1970~2003 Frequency Change of Disasters 1970~2003 Frequency Change of Disasters ENVIRONMENTAL PROTECTION ACTIVITIES PROTECTION ENVIRONMENTAL Activities Protection Environmental CLIMATE CHANGE are closely related to insurance companies, Hyundai Marine exerts best of its efforts to develop and provide exerts best of its efforts to develop insurance companies, Hyundai Marine are closely related to problems in service. To reduce environmental insurance products and customer financial products, We system that is friendly to the environment. we try to maintain a management management activities, to Hyundai responsibilities and duties unique protection activities are not believe that environmental the first In 1995, Hyundai Marine became in the entire insurance industry. Marine; they are obligatory Initiative). We promise you that we will continue to be active insurance company to enter UNEP FI (Finance and environmental management. in environmental protection activities greenhouse effect, the climate pattern has changed greatly. greenhouse effect, the climate pattern has changed have been Natural disasters such as typhoons, and floods the 1970’s and increasing both in size and number between 2003, a total 2003, in particular, during the post-1980’s. In Although insurance payment exceeded 18.5 billion dollars. is the sole we cannot conclude that the greenhouse effect

HYUNDAI MARINE SUSTAINABILITY REPORT 2004-2005 Be The Hi 48 I 49 ENVIRONMENTAL PROTECTION ACTIVITIES 30 20 10 0 Unit : Cases _ Reference : Swiss Re sigma 2004-1

2003 2002

2000

1998

The Signing of CDP (Carbon Disclosure Project) The Signing of CDP (Carbon 2000 with the help of the UK CDP was established in December environmental organization with government. It is an groups across the globe including approximately 100 financial HSBC, Merrill Lynch. CDP is an Allianz Group, Bank of America, pressures general companies like environmental group which emission rates of toxic chemicals (i.e. manufacturers to disclose all sorts of financial institutions such as carbon dioxide) so that insurance banks, security companies, investment banks, level of those companies can use these data to analyze the risk and avoid the manufacturers in accordance with climate change risks, and in the end, preserve the environment. 2005 as Hyundai Marine signed a contract with CDP3 in February that CDP will the first Korean company to do so. We believe companies continue to exercise great influence over financial in these since the number of companies who participate In this environmental protection activities has been increasing. always remain regard, Hyundai Marine ensures you that it will active in the field of environmental protection. 1996 1970~2003 Amount of Insurance Damages 1970~2003 Amount of Insurance Damages 1994

1992

1990

1988

1986

1984 To fulfill our corporate 1982

1980

1978

1976

1974

1972

1970 In 1995, Hyundai Marine entered UNEP FI (UN Environment In 1995, Hyundai Marine entered UNEP FI (UN organization Programme Finance Initiative), an environmental As of May that deals with social activities of financial companies. 45 countries 2005, approximate 230 financial institutions in only Korean participate in UNEP FI. Hyundai Marine is the insurance company to be part of this organization. ENVIRONMENTAL COOPERATION WITH OTHER ENVIRONMENTAL ORGANIZATIONS Entering UNEP FI (Finance initiative) Entering UNEP FI (Finance responsibilities, Hyundai Marine works together with responsibilities, Hyundai organizations and participates international environmental protection activities. in various environmental 446,109 1,766,873 13,996,369 ) 2 588,081 1,576,258 12,326,811 kg) of Carbon Dioxide Emissions(CO 2- 513,868 1,762,281 11,293,449 2002 2003 2004 Convertible Amount(CO 169,881 850,284 32,028,466 Begins with Small Things Begins with 758,553 223,945 28,486,819 The amount of energy used in Seoul and regional headquarters in 2004 was, overall, greater than The amount of energy used in Seoul and regional 195,684 848,074 2002 2003 2004 25,330,348 To incur minimum damage on the environment, Hyundai marine engages in environmental damage on the environment, Hyundai To incur minimum ) ) 3 ℓ Electricity(Kwh) City Gas(m Used Energy Kerosene,( ENVIRONMENTAL MANAGEMENT ENVIRONMENTAL Management Our Environmental Amount of Energy Used recorded per Year SAVING ENERGY management. Although saving energy may not be particularly significant, we aim to expand from it and significant, we aim to expand saving energy may not be particularly management. Although we will be with the nature and the environment, management. To coexist continue with environmental set of environmental management activities. engaging in diverse that of 2003. This was due to the company’s relocation to Kwanghwamun and an extra use of energy. Along with this, the that of 2003. This was due to the company’s by about 10% since the previous year. amount of carbon dioxide emission increased after 8pm in the headquarters to reduce energy. As a result, we have produced Nonetheless, we have been turning off lights 63 tons. We have also been encouraging each department to use both sides of waste that was less than the previous year’s by possible. Saving energy may only be a small contribution to the environmental the papers and to reduce waste as much as protection.

HYUNDAI MARINE SUSTAINABILITY REPORT 2004-2005 Be The Hi 50 I 51 ENVIRONMENTAL MANAGEMENT

(Unit : ton) 863.2

2004

16,209,351 926.6 2003 -kg 2 [ AMOUNT OF WASTE TREATMENT PER YEAR ] Unit : CO

)

ℓ 130,496 (Unit : 2004

14,491,150 107,277

2003

13,569,598 112,638 2002 [ WATERWORKS AND DRAINAGE SYSTEM USAGE RATE PER YEAR ]

Amount of Electricity Used Amount of Carbon Dioxide Emissions 32,028,466 13,996,369 (Unit : Kwh)

2004 28,426,819 12,326,611

2003 25,330,348 11,293,449 2002 2002 2003 2004 [ AMOUNT OF ELECTRICITY USED PER YEAR ] The total amount of carbon dioxide emission generated by energy use per year The total amount of carbon dioxide emission HYUNDAI MARINE IS COMMITTED TO ASSIGNING JOBS TO EMPLOYEES THAT BEST SUIT THEIR ABILITIES AND SATISFY THEIR HOPE. WE OPERATE A ROTATING ASSIGNMENT SYSTEM IN THE INTEREST OF OUR EMPLOYEES AND TO MAINTAIN A HIGHLEVEL WAGE, WELFARE AND WORKING CONDITIONS. THIS IS HOW WE PROVIDE SERVICE THAT IS OF PREMIUM- QUALITY. STAND FIRM AND OPEN YOURSELVES TO US. COME TO HYUNDAI MARINE WHICH EXISTS TO SERVE YOU AND FOR YOU. OUR PEOPLE Employees and Working Environment Development of Human Resource Communication with Internal Customer of Workings Hours Hyundai Marine respects Labor Standards Law. As of March 2005, our employees follow the 40 hour a week scheme, working 8 hours a day, five days a week. Employee Compensation To better reward our employees for their efforts, we award salaries according to seniority and enforcement an annual salary scheme based on the level of performance. Besides the basic compensation such as supporting pensions and bonuses, we also provide additional compensations to workers with specific certificates of qualification. RECRUITMENT Status of Employees employees As of March 2005, Hyundai Marine has a total of 2,650 headquarters including 2,626 executives and staff in the Seoul overseas. We and the branch offices and 24 executives and staff about 18.2% in have about 590 temporary workers who make up 926 female comparison to full-time employees. There are We are yet employees, 35% of the entire employee population. tend to be to have female executives since the insurance sector social reasons; less popular with women due to cultural and each year. nonetheless, we are recruiting more and more women by 3.8 The rate of resignation of full-time workers has decreased in the since 2003 and is now at 4%. We remain deeply interested a friendly work well-being of individual employees and creating the rate of environment. Furthermore, we are increasing about 0.63% of recruitment for hiring the disabled; in 2004, it is whole number of employees on recruiting the disabled. 720 Unit : number of persons [ NUMBER OF OFFICERS AND STAFF SORTED ACCORDING TO JOB GROUPS ] [ PROPORTION OF MALES AND FEMALES IN RELATION TO THE TOTAL POPULATION ] [ RESIGNATION RATE ]

Individuals and Cultivating Their Abilities and Cultivating Their Individuals

Claims Service 546 4.0% Headquarter’s Back office Hyundai Marine aims to maintain a high wage and high-quality welfare and working to maintain a high wage and high-quality Hyundai Marine aims 2004

65% Male 7.9% 117 2003 Regional

headquarters 6.8% Female 35% 2002 EMPLOYEES AND WORKING ENVIRONMENT AND WORKING EMPLOYEES Human Rights the Respecting environment. We take into consideration individual preference and abilities at the time of recruitment and and abilities at the time of recruitment into consideration individual preference environment. We take a ‘rotating most suitable for them. We operate employees to positions which seem attempt to assign twice a year motivated. We also conduct maximize work efficiency and keep employees position system’ to satisfaction express their opinions and level of thorough which each employee can ‘Self-Report System’ and request a transfer. over their assignment Overseas 24 Customer Service Center 182 Branch offices 1,061

HYUNDAI MARINE SUSTAINABILITY REPORT 2004-2005 Be The Hi 54 I 55 EMPLOYEES AND WORKING ENVIRONMENT Hyundai Pension Insurance Fund : Pension Insurance Fund Clubs : Leisure Activities and Various Education Fund : Self-Development Fund : Cafeteria Plan : ■ pension insurance plan, For those who joined individual the basic fees within 50% of the the company pays 3% of insurance fee. ■ leisure and club activities of its Hyundai Marine supports strong sense of community and employees to develop a hotels and condominiums corporate culture. We provide use and provide financial for the employee’s vocational We also support the retired support to about 20 clubs. employees’ Hyundai Insurance Friends Society(members remains are retired Hyundai Marine employees) which especially active in all fields of activities. ■ of Hyundai Marine assists financially up to 2 dependents work for the company’s employees. For those who have school over one year receive funds for kindergarten or high years and those who have worked for more than three enter receive congratulatory funds when their children college. ■ we To encourage employees to pursue self-development, provide partial funds for language and computation classes, physical training and all kinds of education out their necessary to enhance their abilities in carrying duties. ■ category, All employees are free to choose from a welfare year, an under a limited amount, they prefer. Each various employee is given an option to choose from or books cultural activities, whether they be plays, movies amount. as long as the expense does not exceed the fixed SAFETY AND HEALTH OF EMPLOYEES Ombudsmen Committee which consists of two representatives, each from labor and management, was created to take note of individual complaints and tackle various problems occurring within the company such as sexual harrassment . Marine has great interest in providing best working conditions, i.e. brightness of lights, air and temperature control. Physical and mental well-being of individual employees also receive attention as regular check ups and medical assistance are carried out. Under The Hyundai Marine Labor Union We run various programs to offer high wage and provide high-quality welfare and working environment. high-quality welfare and wage and provide programs to offer high We run various Legal Welfare Support : Health Care : Moving and Residential Fees : Welfare Fund within the Company : Mutual Aid Fund : ■ insurance program which We are part of the national pension, health insurance, includes national and industrial accidents unemployment insurance compensation insurance. ■ and regular physical check- We offer both comprehensive ever year and bear partial ups to all of our employees illnesses and hospitalization in medical costs in case of regulation. Every month, we accordance with the welfare use of provide a fixed amount to our employees for the health clubs and gym facilities. ■ to Those who receive promotions are subject costs in reimbursement of their transportation and moving accordance with fixed regulations. For the employees’ the convenience, we also provide monthly aid to lessen burden of paying residential fees in full. ■ a fixed To improve welfare, Hyundai Marine sets aside are amount as a welfare fund from which the employees receive free to take out loans. On Labor Days, all employees with gifts. In case of accidents, we provide our employees of special disaster allowances following the deliberation the relevant committee. ■ funds for A fixed sum is taken from monthly salaries to raise is also both celebratory and grave occasions. This fund rate. used to provide loans to employees at a reasonable PROHIBITION OF DISCRIMINATION LABOR UNION WELFARE SCHEME WELFARE was established in May 1986. As of this year, it has 1,953 members. The Labor Union focuses on improving the personnel management, protection of employees’ rights and enhancing the relationship between labor and management. our Ethics Code, education, region, sex, age, religion and political orientation cannot part in the process of recruitment, appointment and promotion and determining one’s compensation and class of position. In addition, SUSTAINABILITY REPORT 2004-2005 HYUNDAI MARINE DEVELOPMENT OF PEOPLE

Hyundai Marine’s Human Resource Development System

Since abolition of ‘21st Century Human Resource Development Program’ in October 2001, Hyundai Marine has been enforcing Hyundai Marine Human Resource Development System which focuses on independent self-development. To consolidate our corporate image as a place for responsible and independent businessmen and global leaders who will shape management environment, we have been enforcing various programs to enhance business expertise and to strengthen our corporate competitiveness.

The focus of the Hyundai Marine Human Resource building career records through LRM; and five, regular Development System lies in a required selftraining program check-up and corrections over self-made education which encourages employees to pursue self-development plans. and enhance their performance at work. This program built on In 2005, 2,650 employees took advantage of the Human five principles: first, self-made education plans; second, Resource Development System. We invested 672,000 wons to education centering on problems at work; third, duties train and educate one person. and responsibility of the department heads; fourth,

Strengthening Leadership

■Strengthening Education for Officers/Department Heads/Team Leaders

■Strengthening Mid-level manager leadership education through overhaul of education system

■Training potential Department Heads as ‘core’ human resources

■Implementing Education methods to enable task completion based upon strategic thinking

Strengthening Specialty Hyundai Marine Activating the Organization/ ■Training Specialists by job groups Human Resource Innovative Awareness Sharing Core Values and Innovating Organizational Awarenesses ■Devising Education support system to Development ■ strengthen job group specialty ■Social contribution activities ■Executing job group specific education for System strengthening competitiveness

■Providing support for acquiring certificate of qualification

Education Infrastructure Enhancing education results

■e-learning Improving the e-learning system, improving the system ■Improving support system for the education of job groups

■Improving the Education Information System(Re-development) ■Improving the rate of education utilized in actual works done in the field(6 sigma)

■Improving the Hyundai Marine Human Resource Development System Be The Hi 56 I 57 DEVELOPMENT OF PEOPLE We 608 2004 Unit : Thousand Wons 525 CS Training 2,967 2,900 Globalization Training Employee Business Training Basic Cultural Education Employee training, business 2003 1,556,343 1,762,925 Management Training Amount of Education Fee per Year Number of Officers and Staff Education Fee per One Officer/Staff per Year Current Status of Education per Year Education Program for Education Program Human Resource Development CS TRAINING BASIC CULTURAL EDUCATION Innovative Training IT Training Specialized Training training and call center trainings are carried out consistently to provide appropriate service according to customers’ needs and for customer satisfaction. occasionally host events with themes such as strategies for occasionally host events with themes such as who succeed customer satisfaction and 7 colors of people understanding to equip our employees with basic cultural Center, the and to build corporate pride in ‘Hi-Vision company’s training venue This scheme Efforts are being With the purpose of As part of innovative This training scheme is Employees are taught how to use Main Training Programs Main Training GLOBALIZATION TRAINING IT TRAINING INNOVATIVE TRAINING EMPLOYEE BUSINESS TRAINING SPECIALIZED TRAINING ■ MANAGEMENT TRAINING MS Office and the internet to maximize online business capacity and to strength overall competitiveness. divided into many programs such a vehicle insurance divided into many programs such a vehicle accident program, damage assessment program, individuals investigation program and focuses on cultivating who have expertise in one specific field. training program, Hyundai Marine provides basic knowledge and step-by-step education regarding 6 Sigma scheme. Such education process promotes direct and active participation in the company’s innovative training. cultivating individuals with leadership potentials, the cultivating individuals are carried out on many different management trainings they receive vision management levels; in case of officers, strategic management training; for heads of departments, core management training; for training; for team manager, employees, independent Daeree and fourth-level and for fifth-level employees; management training; training. Each level of training offers support management at each level. the kind of education required of employees has since This management education according to rank who have 2005 included special training programs for those follows the been newly appointed and promoted. It divides the leadership pipeline system and therefore, can acquire training into stages at which individuals at their level. knowledge, skills and abilities that are required made at corporate level to expand individual capacity, secure global competitiveness and to improve language skills through IBC (International Business Course), Global Leader program and Overseas MBA program. aims to train individuals to become team leaders through aims to train individuals to become team leaders expert organized and specialized branch manager program, lecturer program and teamwork manager program. Hyundai Marine supports its employees to study an opportunity for a widened broadened economic and an opportunity for a widened different from previous training management perspective program that is designed to system. It includes a special possess expertise in insurance cultivate individuals who changing corporate environment. maters to face rapidly deals with diversification of human This special program of new financial products and new resources and details participants work in groups to marketing theories. The can be used immediately as a produce a thesis which business strategy. We carry out a insurance specialist program to provide basic knowledge about the insurance sector including the introduction of Hyundai Marine, basic information about insurance and insurance business. OVERSEAS STUDY AND FOREIGN EXCHANGE OVERSEAS STUDY AND FOREIGN This is the fostering stage during which employees go through a structure training to become a insurance expert and gain basic digital business knowledge, product specialist knowledge and customer management technique. This is an organized and advanced program that deals with total risk consulting, study of competitive areas and claims service that are required of consulting experts. abroad to gain a better idea of globalization. What is more, abroad to gain a better idea of globalization. to distribute the company hosts overseas study report not had the newly acquired information to those who had who opportunity to study abroad. In return, local employees invited to the work in overseas branches are sometimes Hyundai Seoul headquarters for training and to experience Marine firsthandedly. Hi-Vision This is a college Entrance Stage Growing into an expert Hyundai Marine boasts of the best training system. In particular, upon entering the company, our employees receive Hyundai Marine boasts of the best training system. Fostering Talent of New Man Fostering Talent Education for our Insurance Agents Education for our Insurance Other Education Programs Other Education ■ MANAGEMENT ACADEMY HI-VISION AND HI-LEARN CENTER HI-VISION AND HI-LEARN ■ program operated within the company in order to provide program operated within the company in order was established as an ideal place to train all of our was established as all the trainings conducted by employees. This is where claims compensation division, talent development division, and branch offices take place. In regional headquarters and various facilities, the center addition to lecture rooms the first hall dedicated to insurance has ‘High Vision Hall’, must when it comes to selling new history. Education is a the management structure. In products or changing program response to this, we launched an online training can access called ‘Hi-Learn’ in 2000 which all employees program anytime and anywhere. This cyber training strengthening provides an opportunity for equalization and the time and of business power. Furthermore, it reduces the number efforts that required for training and increases who are less of participants. It is especially use for those knowledgeable. on-spot sales training and are educated in financial consulting. After one year, the employees are trained to become total risk on-spot sales training and are educated in financial undergo ‘insurance marketing training’. Other trainings include ‘Active Education consultants. Three years later, the employees “On-the-Spot, Arriving there on the Scene of the Accident” ‘ as well as ‘car for Honorary Claims Service Members who conduct insurance consulting and claims process’ to produce individuals with expertise in car insurance.

HYUNDAI MARINE SUSTAINABILITY REPORT 2004-2005 Be The Hi 58 I 59 COMMUNICATION WITH PEOPLE to _ Hi-Opinion _ Open Square Homepage To facilitate communication among employees, we have To facilitate communication among employees, We make consistent efforts to create a corporate culture that is both communicative and efforts to create a corporate culture We make consistent enhance Internal customer’s Satisfaction levels customer’s enhance Internal

Open Square Hi-Opinion Hi-day

■ to This is an online system that enables employees unjust discuss personal complaints or opinions on system without informing the CEO’s. This allows and employees to communicate directly with CEO’s helps the company to shape management strategies based on honest opinions of its employees. ■ board This is an online community channel in which the of directors including the CEO shares their personal rest details, ideals and management principles with the of the employees to form a closer bond between the board of directors and the employees. ■ This is an off-line community channel which provides an opportunity for the employees to meet and speak freely to the board of directors. HI (Hyundai Insurance) refers to Hyundai Marine Day, or ‘the day we are happy because we met. This is when, the board of directors and employees exchange opinions freely and enjoy leisure activities such as watching films, attending sports games and playing sports. COMMUNICATION WITH PEOPLE WITH COMMUNICATION

COMMUNICATION ACTIVITIES WITH EMPLOYEES Various Communication Activities Activities Communication Various reliable. To create a culture that is unique to Hyundai Marine, we offer a variety of differentiated a culture that is unique to Hyundai reliable. To create communication programs developed various channels of communication through which employees are able to socialize with each other and form a sense developed various channels of communication of community.

Company-wide sharing of Hi-opinion Responses and Feedbacks by relevant departments

60.9 (Unit : points)

3.18 Consulting’s ESI research results

(Unit : points) *Korea Management Association 2004 59.0

2004

3.21 2003 59.4 2003 Procedural VOE Forum System of the Election of Employee Representatives per Level 2002 Compilation and Sorting of the Employee opinions Execution of the VOE Forum [Research Results of the Insurance Agent’s Satisfaction Index] [Research results of the Officers’/Staff’s Satisfaction Index] _ ‘To the Scene’, Feedback Screen _ ‘To the Scene’, Feedback Hyundai Marine We conduct regular VOE (Voice of Employees) Forum VOE (Voice of Into the Field ■ all levels and of representatives from In the presence employees well as the board of directors, divisions as make suggestions their opinions and are free to express in company strategies. that can be reflected ■ visit the fields in person to The Board of Directors with the employees and maintain a good relationship or suggestions regarding to take note of any complaints Board also visits the branch the work environment. The center for brief discussion to offices and claims services in person. hear the employees’ opinions SURVEY OF THE INSURANCE AGENTS SATISFACTION INDEX EFFORTS TO INCREASE ESI ESI(EMPLOYEE SATISFACTION INDEX) similar to Hyundai marine received an ESI of 3.18 in 2004, continue to that of the previous year. Hyundai Marine will the invest time and effort to improve ESI by reforming system and improving the welfare. surveys on the satisfaction of our insurance agents. These surveys have shown an overall improvement over the years. In 2004, Hyundai received a satisfactory mark of 60.9. We will try our best to make necessary amendments in business operation as well as welfare programs to better satisfy our employees and their families. conducts a ‘Self-Reporting System’ twice a year to improve conducts a ‘Self-Reporting System’ twice a year expresses his ESI. This is a system in which the employee aptitude, own opinion regarding the workload, individual discretionary power, difficulty of tasks, balance, performance feedback as well as growth potential, confidence, communication with the bosses, salary, welfare and the level of satisfaction over the training program. It also allows employees to write down the position and tasks he or she wishes. We take this Report into consideration carefully especially when reassigning employees, giving rewards for satisfactory performance and so forth.

HYUNDAI MARINE SUSTAINABILITY REPORT 2004-2005 OUR SHAREHOLDERS Corporate Governance Structure Communication with Shareholders that Chairman of the Hyundai Marine Board of Directors Chief Executive Officer, President of the Hyundai Marine Full-time Auditing Officer of the Hyundai marine President of the Hyundai Marine Auditing Committee Non-permanent advisor at the Korea Life Insurance Company Hyundai Marine Auditing committee member Attorney-at-law at Bae, Kim and Lee Hyundai Marine External director Chief Executive Officer and President of the Sharp, Inc., Chief Executive Officer and President of the US Air Alliance company Hyundai Marine External director Professor, Department of Business Administration, Kookmin University, Seoul, Korea Name Explanatory Note Chong-seon Ha Hyun-young Cho Dong-hoon Kim, Chong-seong Kim Kyu-sang Cheong Soon-seok Paik Hyundai Marine selects insurance, legal and accountant experts outside the company Hyundai Marine selects insurance, legal and accountant aim to guarantee Corporate Transparency aim to guarantee Hyundai Marine intends to establish corporate transparency and sound management to establish corporate transparency Hyundai Marine intends Executive officer / Non-executive officer Executive officerExecutive officer Mong-yoon Cheong Auditing Officer Non-Executive Officer Non-Executive Officer Non-Executive Officer Non-Executive Officer External Director Classification Internal Director CORPORATE GOVERNANCE CORPORATE with the Shareholders Promises Current Composition of the Board of Directors THE BOARD OF DIRECTORS structure to maximize benefits of all stakeholders. We faithfully abide by all relevant regulations which deal abide by all relevant regulations benefits of all stakeholders. We faithfully structure to maximize as well as treatment of shareholders of corporations, rights of shareholders, with ownership structure pays special The Board of Directors board of directors and corporate transparency. responsibility of the can it believes that a just corporate structure the rights of the shareholders since attention to protecting in mind and transparency. Bearing all activities are carried with responsibility only be realized when management activities can succeed only if they are grounded Hyundai Marine’s belief that all sustainable all investment activities shall be ruled by transparency. upon moral values, we promise you that to enhance the Board’s transparency. The Board of Directors determines the main management strategies of the company and is to enhance the Board’s transparency. The Board Hyundai Marine strengthened its independence by increasing the number of therefore most important decision-making body. the amended Securities and Exchange Act of 2004. As of March 2005, external external directors from 3 to 4 in accordance with During the fiscal year 2004 (2004.4.1 ~ 2005.3.31) 22 regular and temporary directors make up 57% of Board of directors. meetings took place with 100% participation rate.

HYUNDAI MARINE SUSTAINABILITY REPORT 2004-2005 Be The Hi 62 I 63 CORPORATE GOVERNANCE Can demand all information required to carry out audit duties Nomination Committee Internal Director : 1person External director : 2persons Policies and strategies on risk management, setting limit and regulating risks, coming up with countermeasures and assessment. Nominate external directors The sub-committees are made up of audit committee The sub-committees are Purpose Rights Audit activities based on commercial and other laws Making decision on risk related issues Nominate external directors during board of directors meetings Directors Committee Risk Management Internal Director : 1person External director : 2persons Internal Director : 1person External director : 2persons 1 person 2 persons 1 person1 person 2 persons 2 persons Composition of Members Internal Director External Director Audit Committee External Director Classification External Director Committee Internal Director : 1person External director : 2persons Nomination Committee Current Composition of Main Committees under the Board of Directors Current Composition of Main Committees The Board of Directors and Main Committees under the Board of Directors and Main Committees under the Board The Board of Directors MAIN COMMITTEES UNDER THE BOARD OF DIRECTORS MAIN COMMITTEES Audit Committee Risk Management (3 persons), risk management committee (3 persons) and external director nomination committee (3 persons). Besides the director nomination committee (3 persons). committee (3 persons) and external (3 persons), risk management can make by the Board of Directors, the sub-committees be entrusted to the sub-committees legally matters which cannot company. and speed and play an important role in the decisions with expertise e Placing customer satisfaction at the center of its business Placing customer satisfaction C.F.O Head of the Corporate Planning Department Person in Charge mail: ir@ hi.co.kr - Contact Information Tel : 02)3701-8035, 8309, 8040 e COMMUNICATION WITH SHAREHOLDERS WITH COMMUNICATION Organization Chart of the Hyundai Marine IR COMMUNICATION ACTIVITIES WITH SHAREHOLDERS COMMUNICATION activities, Hyundai Marine aims to provide optimum service to its customers. We engage in a diverse set of activities to improv We engage in a diverse set of activities aims to provide optimum service to its customers. activities, Hyundai Marine communication with stakeholders because we believe that customer satisfaction provides us with business motive. To present satisfaction provides us with business motive. because we believe that customer communication with stakeholders oversees the convenience, Hyundai Marine’s C.F.O. accurate corporate information at their shareholders and investors to maintain IR. Furthermore, we host corporate events and all activities relating to the company’s management of IR structure We also use investors in a direct and open manner. with shareholders, investors as well as potential consistent communication Our website management strategies of Hyundai Marine. as an opportunity to show performance and shareholders’ meeting fair and fact book which are updated regularly to provide such as IR material, Annual Report and contains essential information and basic present to shareholders and investors accurate believe that IR activities are the means to accurate information. We trust. management materials and a way of building corporate information and

HYUNDAI MARINE SUSTAINABILITY REPORT 2004-2005 APPENDIX Assurance Report GRI Index Ethics Codes Customer Evaluation of 2004-2005 Contact Us We place tremendous significance on the fact that Hyundai We place tremendous significance on the fact that We suggest that Hyundai Marine makes additional efforts to We reviewed the faithfulness and accuracy of the report through We reviewed the faithfulness We describe below our assessment. Hyundai Marine’s report falls into the 1st stage according to ‘B.E.S.T. Hyundai Marine’s report falls into the 1st stage according We checked whether the data provided in Hyundai Marine’s 2004-2005 We checked whether the data provided in Hyundai Marine’s We confirm that the details of Sustainability Management, Our Customers, We confirm that the details of Sustainability Management, We confirm that the report’s ‘vision and strategies’ and ‘profile’ in accordance We confirm that the report’s ‘vision and strategies’ and ‘profile’ Media and Internet Search : : Main records and documents ■ of data by Sustainability Report is accurate. We confirmed that the accuracy referring to official accountant material and external official material. ■ with GRI standard do not contain significant error or prejudicel. ■ do not contain Our Society, Our Environment, Our People, Our Shareholders significant errors or prejudice. ■ Sustainability Report Guideline’. ITEMS TO BE DISCUSSED IN THE FUTURE WORK UNDERTAKEN ■ and environmental issues during the reporting We grasped the main social period. ■ report based mainly on the records and We judged Hyundai Marine’s Marine. We assessed with an assumption that documents provided by Hyundai by Hyundai were truthful. For a detailed the records and documents provided strategies material, various internal evaluation, we reviewed the management and interested documents, external official materials and surveys on employees parties. CONCLUSION following measures. Marine’s 2004-2005 Sustainability Report’ is the first of its kind in Korea which is based on GRI Financial Supplement. The report will require more time and effort in enhancing the level of the report and a detailed review of important issues by a wide-range of stakeholders. For this report to be more comprehensive, it will need to include more details of non-financial information. maximize environmental performance and enhance the management system in order to increase comprehensiveness and truthfulness of the details of the report as well as to review and develop issues appropriate for a corporate environment through participation of internal and external stakeholders. In addition, we would like to advise Hyundai Marine to take into consideration a quantitative report which can show the trends of improvement. (*B.E.S.T. Hyundai Marine was requested to provide a separate assurance Hyundai Marine was requested In the 2004-2005 Sustainability Report, Hyundai marine describes In the 2004-2005 Sustainability Report, Hyundai marine We did not participate in Hyundai Marine’s drafting of this report. We did not participate in Hyundai Marine’s drafting of We reviewed the appropriateness and truthfulness of data, significant errors We reviewed the appropriateness and truthfulness of data, We confirmed whether the report is based on GRI (Global Reporting Initiative) We confirmed whether the report is based on GRI (Global Reporting GRI Sustainability Report Guideline : B.E.S.T. Sustainability Report Guideline : ASSURANCE REPORT ASSURANCE Sustainability Report Guideline was developed and distributed by Ethical Management Forum with the intention of encouraging Korean corporations to publish sustainability report. It provides a guideline suitable for Korean corporation under the global sustainability report guideline and categorizes the quality of report into 5 levels.) We checked whether Hyundai Marine’s 2004-2005 Sustainability Report followed the economic social and environmental indexes of the GRI 2002 Sustainability Report Guideline by referring to 141 indexes. We also reviewed to make sure that the report adheres to the indices provided by the Financial Supplementary, the GRI standards for the financial sector. ■ We confirmed whether the report is based on ‘the B.E.S.T. Sustainability Report Guideline’ developed by Ethical Management Forum and checked which stage in the B.E.S.T. Sustainability Report Guideline the report falls in. STANDARDS AND CRITERIA ■ INDEPENDENCE CONTEXT AND SCOPE ■ Customers, Our and prejudice contained in Sustainability Management, Our Society, Our Environment, Our People and Our Shareholders. ■ Guideline the and checked which stage in the B.E.S.T. Sustainability Report report falls in. INTRODUCTION Dear Hyundai Marine Executive OfficersDear Hyundai Marine Executive We are independent and free from influences of the company and We are independent and free from influences of the relationship with furthermore, do not engage in any kind of business profit. Hyundai Marine from which we do not intend to generate sustainability management and its efforts, results and future plans. We sustainability management and its efforts, results and reviewed the following content. report on our 2004-2005 sustainability report. We are held liable for the report on our 2004-2005 sustainability the report as well as the system and information provided in based on which the information is maintenance of internal restriction whether Hyundai Marine’s sustainability given. We have confirmed of data and significant errors and report included the appropriateness opinion below. prejudice. We express our independent

HYUNDAI MARINE SUSTAINABILITY REPORT 2004-2005 Be The Hi 66 I 67 ASSURANCE REPORT vities 7, 66 7 Not applicable 7 5 4 s Meeting 63, 64 6, 50, 51, 57 See Annual Report 17, 79 PAGE ’ s methods of measures applied to core economic, environmental and social elements s methods of measures applied to core economic, environmental and ’ s and last year ’ s management strategy promotion process 15, 22, 23 ’ s Statement on the Sustainability Reports Statement on the Sustainability 10, 11 ’ Policies and practices which guarantee and strengthen accuracy, completeness, confidence of the Report Policies and practices which guarantee and strengthen accuracy, Stakeholder engagement Connection between financial and non-financial objectives of the organization and compensation of officers Organizational structure and persons in charge of monitoring, implementing and auditing economic, environmental and social acti Comparisons between this year SYSTEMS 3.GOVERANCE STRUCTURE AND MANAGEMENT Structure and governance Report profile Report scope CONTENTS 1. VISION & STRATEGY 2.PROFILE Organizational profile 3.8 3.9 of Director Mechanism which presents suggestions and direction of the shareholders to the Board Grounds for analysis and selection of main interested parties 19 3.2 3.3 3.4 Ratio between non-officers and External director3.5 The Organization 3.6 Economic, Environmental and Social Risk Management of the Organization3.7 Details of Mission value, Principles or codes of conduct Developed Internally 24, 25 71~76 62, 63 3.1 Governance structure of the company 62, 63 2.8 2.9 Size of the Organization List of Interested Parties 4, 5 20 2.2 2.3 2.4 Main Products and Service2.5 Organization Structure2.6 Companies Main Departments, Subsidiary Companies, Affiliated 2.7 Overseas Market Legal Ownership Structure of the Company Market Personality 4, 5 4 4, 28~33 5 1.1 1.2 Strategies, Statement of the Organization Vision, CEO 2.1 Name of the Organization 14, 15 4 3.10 3.11 3.12 parties Methods of negotiations with interested with interested parties Form of information during negotiations parties Information regarding participation of interested 34, 35, 59, 60, 64 34, 35, 59, 60, 64 34, 35, 59, 60, 64 2.19 2.20 2.21 2.22 of report Policies and practices which are helpful in enhancing confidence additional information Measures to obtain 7, 66 79 2.14 2.15 2.16 Changes in Product and Service since the Last Report among Reporting Organizations Comparisons among Subsidiary Companies and Comparisons 2.17 the previous report Explanation of the personality of information provided in 2.18 See Annual Report Application of GRI Principles Economic, Environmental, Social Profits and Expenses Not applicable Not applicable 45, 50, 51, 57 6, 21, 44, 7 2.10 2.11 2.12 Department in charge of the Report and its Contact Information2.13 Period of Report Recent Report Date Range of Report 79 GRI ITEMS GRI INDEX 6 PAGE 48, 49 67~70 s taxes according to countries 45 ’ Environmental performance 4. GRI CONTENT INDEX of GRI Report Content according to section and index A chart which explains the locations of all structural elements 5. INDICATORS PERFORMANCE Economic performance CONTENTS Overarching Policies Companies Membership Qualification for Domestic and International Industrial and Business Association, 4.1 3.13 3.14 3.15 of the Organization Risk Management 3.16 Environmental, Social Charter of the Organization Economic, 3.17 3.18 of product and service for social and environmental improvement Reform measures 3.19 social influence of the organization Indirect economic, environmental and 3.20 Location and changes of business venueand social progress Program and procedure regarding economic, environmental system Certification for economic, environmental and social management 29, 33 Reported throughout 20 14, 16 22, 23, 31 24, 25 4 EC1 EC2EC3 Net Sales EC4 Market distinction according to geographical locationEC5 Purchase Price of Products, materials and serviceEC6 Clarity of Loan PaymentEC7 Total number of Employees by Nationality and Regions and compensation systemEC8 Distribution of loan suppliers according to dividend of receivablesEC9 Rise and fall of confidential retained earnings All forms of amount of one received subsidiary according to countries and regions 54 4, 5 See Annual Report Not reported Not applicable See Annual Report Not reported EN9 which destroy the ozone amount of emission of substance 50 EN1 EN2 EN3 total usage of resources by formEN4 Reuse of waste generated from external sourceEN5 amount of direct energy usedEN6 amount of indirect energy usedEN7 amount of total water resourceEN8 which is a habitat for diverse living organisms location and size of a managed lot organisms main influence on diversity of living greenhouse gas emission Not applicable 51 50, 51 Not applicable 50 Not applicable 51 50 EC10 EC11 EC12 donations to regional society and private organizationsEC13 of organizations Classification of suppliers according to nationality Infra Development of non-core businesses Indirect economic impact Not applicable 42 Not applicable Not reported EN10 EN11 EN12 emission amount of main air, i.e. NOx, SoxEN13 wastes according to form and final treatmentEN14 amount of waste from water systemEN15 leakage of chemicals, petroleum and fuelEN16 and service environmental influence of main products compiling and recycling ratio of products that can be recycled violation of environmental regulation Not applicable reported Not Not reported 50, 51 Not applicable Not applicable Not reported GRI ITEMS

HYUNDAI MARINE SUSTAINABILITY REPORT 2004-2005 Be The Hi 68 I 69 GRI INDEX 54, 55 Not applicable 54 21 PAGE 55 Not reported s management, providing information to employees and reaching an agreement s management, providing information ’ s dilemmas consulting system 59-60 ’ voluntary following of summary and product label and awards on social and environmental performance articles on decision making, management, official participation of employees in corporate management structure articles on decision making, management, official participation CONTENTS Social performance in case of changes in organization LA6 LA7 LA8 Health safety committeeLA9 rate of injury, days of loss and absence policies and programs on HIV/AIDS average number of education hours per employee per year 57 Not reported Not reported 55 LA1 LA2 LA3 Status of Employees LA4 country and change of occupation by region and net rate of newly-created employment LA5 union employees who are members of the labour natural disaster and illness examples of record and notification of 54 Not reported 55 SO7 policies, procedure and management system to prevent acts which impede competition 17 SO1 SO2 SO3 policy, program and monitoring system in regard to influence of regional societySO4 policy, procedure and management system on bribe and corruptionSO5 policies for political lobbying and cash managementSO6 Awards in relation to social, ethical and environmental achievement funds for parties/candidates regulations prohibiting monopoly 40 17 21 Not reported 17 Not reported PR7 PR8 regulation product information and labelling system on customer satisfaction policies, procedure/management 28~35 Not applicable PR1 PR2 PR3 regulations health of customers and safety PR4 system in relation to product information and labelling policies, procedure and management PR5 system on customer privacy policies, procedure and management PR6 regulations health of customers and safety and services popular complaint on products 30 36, 37 28~31 28~31 34, 35 HR8 HR9 employee education on human rights complaint practices 55 HR2 HR3HR4 impact of human rights (supply/contractor. investment/procurement)HR5 deal with human rights records within the company policies and procedures to assess and HR6 practices comprehensive policy to prevent discriminatory HR7 freedom to make decision elimination of child labour prevention of forced labour Not reported Not reported 55 55 55 Not applicable HR1 policies on human rights 55 LA12 LA13 LA14 employee welfare LA15 LA16 industrial health management systemLA17 with the labour union official agreement structure program employee education on continuing education policies and programs Not reported Not reported 56~58 56~58 LA10 LA11 on equal opportunity policy and program officer and managers structure of high-ranked 62, 63 55 HR10 HR11 HR12 Employee HR13 employees human rights education of security HR14 policies, guideline and procedure to deal with needs of residents in the region employees confront explanation of mechanism and organization which deals with difficulties sales proportion of local community 34, 35, 59, 60 35 36, 37 Not reported GRI ITEMS s sustainability ’ 20 79 Not reported 25 Not reported 20 54, 55 Marine PAGE s annual salary Not reported ’ activities with SRI as aims Not reported ’ Asset Management Insurance Internal Social Performance Performance to Society Suppliers CONTENTS SECTOR SUPPPLEMENT FINANCIAL SERVICES Social performance CSR management AM1AM2AM3 asset management policy relevant articles and assets for social security shareholders Not reported Not reported INT1INT2INT3 internal CSR policy INT4 and employment rates for change of occupation INT5 of employees degree of satisfaction INT6 compensation for managersINT7 in sustainability growth compensation which assist ratio of men and women profile of managers 54 Not reported 60 Not reported INS1INS2INS3 policy of underwriting INS4 customer profile cases and content of customer complaint social security insurance 34, 35 30 SOC1SOC2 amount of donation to charity effect of creating economic values Not reported 42, 45 CSR1CSR2CSR3 CSR policies CSR4 CSR organization CSR5 CSR auditing CSR6as bribes and corruption management of sensitive issues such cases of legal violations communication procedure with shareholders reported Not 64 Not reported SUP2 degree of satisfaction of suppliers Not reported SUP1 policies and procedures to monitor key suppliers 32 GRI ITEMS GRI (Global Reporting Initiative) is an international organization which provides guidelines for sustainability report. Hyundai GRI Guideline report was based on the GRI Guideline.

HYUNDAI MARINE SUSTAINABILITY REPORT 2004-2005 ETHICS CODES 70 I 71 GRI INDEX Hi The Be

Basic Ethics of Employees customer details, etc.) must not be at all times be used other than for company objectives. 1. Basic Ethics of Employees B. Given that the company assets has been entrusted to the company by the Below is the basic ethics that all employees must follow. customers, they must be used fairly and efficiently; all business expenses and transactions must be approved by the head of the management, recorded A. The employee of the Hyundai Marine must take pride and maintain an honest and faithful attitude as a member of Hyundai Marine. accurately, carried out with transparency and be based on corporate accountant standards and management regulation. B. The employee must share management policies and the objectives and values of the company and carry out faithfully the duties which were assigned to him or her. 4. Prohibition of Discriminatory Acts C. All duties must be performed with best efforts and through fair means; all There must not be any form of discriminatory action laws and statues must be followed; all regulations and structure must be toward any employees. respected. A. All employees must be treated fairly and with respect and be placed in an D. While understanding fully his or her rights and duties, the employee must environment in which he or she is given opportunity to show his or her make and act upon decisions which fall within the limits and corresponds ability. All recruitment and promotion must be made objectively and with company objectives. rationally in consideration of individual ability and performance. Personnel E. The employee must be fully aware of the responsibility entailing his or her management and procedure (hiring, promotion, assignment) must not take decisions and action and, in case there is a problem, he or she must take the place irrationally and without discrimination and employees must not suffer initiative to resolve it. from discrimination, oppression, torture and ostracizing. F. If assigned task or objective is against or undermines the interest of the society, the employee must report to his or her boss and the company immediately. 5. Prohibition of Sexual Harassment G. The employee must maintain, manage and protect the company assets as There must not be sexual harassment. well as company details and confidential information. H. The employee must improve the efficiency and effectiveness of tasks A. All forms of sexual harassment must be prevented since it violates human through active cooperation and communication between colleagues and rights of individuals, incurs loss of motivation to work, negatively influences divisions and the working environment, damages corporate image and causes legal problems. B. Abuse of official authority and acts of human rights violation regarding 2. Laws and Company Regulations human rights may cause discomfort or fear and constitute a form of All employees must abide by laws and company regulations. defamation by which mental suffering can be induced. Given that sexual A. All employees must follow strictly all laws and company regulations relevant harassment is an illegal act under the civil law, it is subject to indemnity. to his or her duties. C. The following acts may be a form of sexual harassment. B. The head of the department must check regularly whether the employees 1) demanding to serve alcohol, dance or sing at dinner gatherings abide by laws and company regulations. 2) engaging in obscene conversation and dirty talk and visiting lewd C. If a question or a legal problem arises or is likely to develop, it must be internet sights at work referred to the head of the department, Person in charge of the compliance 3) sexual remarks and figures of speech about physical attributes of a at the department or the Compliance Department. colleague 4) unnecessary physical contact 3. Transparent Management of Company Assets and Money 5) sexual acts which incur a sense of shame and humiliation Management of company assets and money must be transparent.

A. The company’s corporate property (land, building, facilities, etc.) and 6. Mutual Trust and Respect among Colleagues intangible property (trademark rights, copyright company information and Colleagues must be treated with respect and faith In light of fairness and social commitment financial organizations are associated with, more severe standards are expected of employees working at financial organizations. All employees must not be involved in any private financial transactions for personal interest or engage in acts of share investment using company information. All employees must take sufficient care to avoid errors and reject unreasonable favour or suggestion. In case an error occurs, it must be reported and publicized so that it undergoes appropriate procedure to Using the internet to engage in personal chatting or instant messaging, Using the internet to engage in websites is forbidden and the head of the playing games or visiting unsound steps to ensure that all employees are able department must take necessary to work in a sound cyber environment. be exposed through personal email and Company information must not must not be duplicated or distributed. illegal software or any illegal consent company website (hi.co.kr) can be easily Given that any information on the opinions understood as company’s official comment, any information or relevant posted on the website must be reviewed and approved by the department. be used in Since groupware was developed for business purposes, it must and accordance with company policy and purpose. Any excessive refutation and criticism on comments without reasonable grounds, personal attacks unconfirmed rumour must be avoided. Use of unsound and vulgar language on groupware must be avoided. and, at the No attempts to retrieve password of other people must be made his or her same time, all employees must be careful not to give away must password to others. In case password has been exposed, an employee must remember that he or she is responsible. The head of the department operate a management system to protect personal details of his employees. and Only software provided by the company must be used. Duplicating Accessing distributing the software is a violation of intellectual property. unethical other person’s information without permission constitutes an conduct and is therefore prohibited. head of If an employee wishes to operate a cybermall, permission from the department or head of relevant divisions must be obtained. All employees must keep in mind that the same ethical standards are applied in the cyberspace. 10. Observing economic ethics as a finance officer All finance officers must abide by economic ethics. A. B. C. A. B. C. D. E. F. G. H. All borrowing and lending of money, excess loan guarantee, joint liability on All borrowing and lending of money, excess loan guarantee, joint trade guarantee among employees must be avoided since acts of money and incur weaken the corporate coherence, cause individual bankruptcy damage on both individuals and the company. All company records must be maintained accurately. All information (including personal details) obtained through the company must not be exposed to or discussed in public, or be used for purposes other than business. All efforts must be made to avoid intentionally exposing the company information to the public, or reading or inadvertently discussing company information in public. All employees who resign must return all software and relevant materials to the company and must not keep any duplicates. A mature corporate environment must be made by respecting the privacy of A mature corporate environment and understanding. individuals and building mutual trust instruct the persons of lower rank carry out A person of higher rank must not policies and undermine fair tasks which violate law or company performance of duties. instruction given by his or her boss. In case An employee must perform a fair the employee must state the the instruction is illegal or unreasonable, or change. reasons behind his or her complaint and request for cancellation be solved If such instruction persists despite the requests, the problem shall by following ‘ethics problem consultant procedure’. privacy and A mature corporate environment based on respect for individual language mutual trust and understanding. Abusive and humiliating must between persons of higher rank, persons of lower rank and colleagues be avoided at all times. 9. Sound Cyber Ethics Efforts must be made to foster a sound cyber ethics. A. other 8. Prohibition of Use of Company Information than for Business Purposes Company information must not be used for non- business purposes. A. B. C. D. 7. Prohibition of Acts of Money Trade All employees must avoid acts of money trade A. B. C. D. E.

HYUNDAI MARINE SUSTAINABILITY REPORT 2004-2005 Be The Hi 72 I 73 ETHICS CODES Keeping in mind that customers are the source of growth for Hyundai Keeping in mind that customers are the source of growth for Marine and therefore, all employees must provide best service. when All employees must be well-groomed and speak and act politely serving customers. their All employees must tell the truth to the customer and keep appointment. If for some reason an employee cannot keep the appointment, the he or she must contact the customer, and apologize and describe it must be reasons for cancellation. If the appointment carried importance, recorded. Customers must always be able to file complaint or make suggestions If thorough post, telephone, internet and various channels communication. a complaint or a suggestion has been filed, the manager must be notified immediately and the customer must also receive an answer. This should also be recorded. When expressing one’s own opinion, he or she must make it clear that it is When expressing one’s own opinion, company. his or her own view and not of the the company such as lectures, editorials All speech and behaviour outside reputation. and debates must not damage company’s Any information which has direct impact on customer’s profit, or the customer has the right to know must be revealed according to the relevant laws and regulations. All publications pertaining to product and claims service including written applications, invitations and posters must include details which incur direct impact on customers and must avoid technical terms to facilitate customer’s understanding. A. B. C. D. Ethics Guideline in serving Customers Customer 1. Principal Standards of Action to Gain Satisfaction Hyundai Customer Satisfaction, in accordance with at the Marine management policy ‘customer satisfaction principal centre of company activities’, must be the for all standard for all actions and judgments employees. B. C. A. B. 2. Respecting the Customer’s Right to Know Employees must respect the customer’s right to know. All speech and behaviour which damage he company’s reputation must be avoided. To maintain fairness and soundness and prevent the loss of confidence of the investor, the use of unpublished information or manipulating market condition is prohibited. Employees cannot directly or indirectly exchange stocks based on unpublished information for personal interest. Except for those who have the right to know for reasons of business, employees must not engage in conversation where there exist risks of exposing confidential information and should restrict others from accessing those information. become resolved. Measure to prevent reoccurrence of errors should be become resolved. Measure to made. any form of entertainment whether it be, Employees should not agree to presents or alcohol. However, if the financial, products, gift certificate, be verified and keeps on sending gifts and provider of entertainment cannot the employees, on multiple occasions, has other forms of entertainment and should be forwarded to the company expressed refusals, those items thorough ethics consultant procedure and be given to the poor. and all The provider then should receive a thank you note from the company information pertaining to this must be documented. In general, small gifts and form of entertainment as a token of appreciation to can be accepted but the employee must go through a proper procedure obtain permission from the manager. which For civil servants or equivalent, accepting any gifts and entertainment can be seem unreasonable and is considered to have influence on business, to the civil reasons for prosecution. If providing gifts and entertainment and servant cannot be avoided, the employee must consult the company should not rely on his or her own judgment. personal The employee cannot engage in business outside the company for company, profit and if a separate business is necessary for the benefit of the then he or she must obtain approval from the company. 12. Prohibition of Defamation of Company Acts which defame the company must be prohibited. 11. Prohibition of Stock Exchange Using Unpublished 11. Prohibition of Stock Exchange Using Unpublished Information to buy Employees cannot use unpublished information orsell stocks. G. F. E. D. A. B. A. SUSTAINABILITY REPORT 2004-2005 HYUNDAI MARINE

3. Duties to Protect Customer Information Responsibility Toward Shareholders Employees are responsible for protecting customer information. 1. Maximum Guarantee of Shareholder’s Profit Shareholder’s profit must be guaranteed to the maximum. A. When obtaining customer information, an employee cannot disclose that

information or use for other purposes. Measures to protect customer A. Shareholders must be compensated appropriately and soundly thorough information such as hacking prevention and virus prevention must be efficient management. formed. B. To win the shareholder’s trust, employees must operate a risk management system and internal restriction system to enable efficient and pragmatic 4. Duties to Manage Customer Profit investment and management. Employees must do their best to manage customer C. The safety of shareholder’s profit must be guaranteed by business expansion profit. and short-term market favour. D. If a shareholder’s right has been violated, all necessary measures must be A. Employees must guarantee customer’s prosperity through scientific and taken to remedy the situation and to prevent recurrence of violation. specialized insurance service and do their best to increase the value of E. Employees must make efforts to earn appropriate assessment through customer assets and protect customer’s right through advanced asset publicity in and outside Korea an IR (Investor Relations). management and investment technique.

5. Fostering a comfortable and pleasant counter 2. Duty to Provide Information to Shareholders environment Information must be provided faithfully in accordance Employees must create a comfortable and pleasant with the Obligation of Fair and Public Notice. counter environment A. Useful and reliable information must be provided to facilitate investments A. Customer’s safety and convenience must be the priority in fostering a and decision making. counter environment. Facilities with risks of danger must be eliminated and B. Public notices must be displayed in appropriate places so that shareholders various convenience facilities must be installed. may consult them at any time. B. The counter as well as restrooms, parking lot and vicinity must be hygienic C. Company information must be provided to prevent unfair trade using and pleasant. internal information and to help shareholders analyze the company

6. Accurate and efficient business to protect customers Employees must carry out business accurately and efficiently to protect customers. 3. Equal treatment of shareholders All shareholders must be treated equally. A. Employees must not engage in unethical acts which damage customer’s profit. A. All shareholders, whether shareholders with small proportion of share or B. Employees must be familiar with information needed to protect customers foreign shareholders, must be treated equally. and must carry out business accurately. C. Customer complaint must be received, processed immediately and recorded given that this task is directly related to the company’s customer-friendly 4. Strict Accounting Management image. Strict account management must be performed. D. In case confirmation of identity is necessary, it must be confirmed whether or not the photograph on social security card is false. A. Accurate accounting record system must be maintained in accordance with E. Employees must not engage in, relate to or keep silence on transactions general accounting standards. pertaining to money laundering and must report to the company under the B. Unpublicized fund must not be created for any purpose and no false or Work Regulations prohibiting Money Laundering. fabricated information must be recorded. 74 I 75 ETHICS CODES Hi The Be

C. All recorded information must be checked and confirmed regularly and if 3. Prohibition of Collusion, Cartel there is a difference in amount between the amount recorded and the actual Illegal act of collusion must not be carried. amount, an appropriate procedure must be taken to determine the correct amount publicly. A. Any act that involves collusion with another company and limiting fair competition must be avoided. B. Any act that involves collaboration with another company and refusing or limiting transaction with a particular company must be avoided. Fair Competition

1. Fair Competition 4. Prohibition of Acts of Unfair Trade Business activities must be carried out fairly. Any act of unfair trade must be avoided. A. Providing rebate or special benefits to attract customers of the competitor or inducing them by causing confusion is prohibited. A. Making unreasonable demands to customers, refusing transaction illegally B. Providing unreasonable or excessive premiums to attract customers of the or discrimination transaction conditions with particular customer is not competitor is prohibited. Strict regulations are applied in cases where fair allowed. competition is hampered by providing unreasonable or excessive premiums B. Any act that may eliminate competitors by purchasing illegally at a high to attract customers of the competitor Premiums must be selected carefully price, forcing customers to engage in transaction under unfair condition, in accordance with the corporate identity and customer satisfaction, demanding financial gains, establishing transaction conditions unfavourable especially since, if a customer suffers an injury from the premium, the to the customer, abusing superior position to interfere in others’ financial company may be liable. activities, restricting or interfering illegally in business activities of the C. Any indication or advertisement which may be false, deceive or confuse customer must be avoided. customers must be prohibited. C. Any collusive act that refuses or restricts business with a particular customer D. Any act of dumping with the intention of eliminating competitors is not must be avoided. allowed. E. A use of superior position as a means to pressure others is not allowed. F. Damaging reputation of the competitor through unreasonable criticism or 5. Prohibition of Unfair Internal Trade falsehood is not allowed. Internal trade among subsidiary companies is prohibited.

A. Any act of providing excessive financial gains when engaging in transaction 2. Compliance Program for Fair Trade with subsidiary company with whom the company maintains an unfair Compliance Program for Fair Trade must be abided voluntarily. relationship must be avoided. B. The company must not refuse business with non-subsidiary company to A. To calculate price through fair and free competition and to establish sound engage in business with a subsidiary company. financial order, any act that may impede fair trade must be avoided. C. There cannot be act of coercion, direct or indirect, to force transactions with B. Employees must bear in mind that fair trade prevents financial liabilities subsidiary companies without reasonable grounds. incurring from violation of law and highlights fairness and transparency of the company which in return strengthen the company’s competitiveness. C. The company and the employees must follow the standards outlined in the 6. Protection of Copyrights Compliance Program in relation to fair trade. Laws on trademarks and copyrights must be observed. D. The company must designate a self-compliance authority and department in accordance with the Compliance Program and establish a internal A. A trademark that is similar to or identical as a trademark used by another restriction system for CP to educate the employees and formulate measures company must not be used. in case of violation of fair trade laws. B. A violation of trademark law may incur restriction or claim for damage by B. in the interest of the region. outside Korea, the company must abide Regardless of location, within and laws. by both regional laws and international The company respects political rights of individuals and therefore employees The company respects political rights of individuals and therefore must not are free to express their political opinion. However, employees opposing a undermine political neutrality of the company by supporting or such action certain party or a group or a candidate under the impression that represents the political view of the company. Policies and laws pertaining to the company can be expressed. The insurance industry is a non-profit business which guarantees futures of individuals. Finding and improving new systems is Hyundai Marine’s duties. Hyundai Marine will do its best to fulfil its responsibilities. Given the intimate relationship between company profit and the traffic Given the intimate relationship between company profit and improving system, the company and employees must play an active role in the traffic system. Since environmental pollution disrupts the ecosystem and threatens the lives of human beings, Hyundai Marine fully supports and actively participates in all environmental protection activities. 3. Prohibition of Political Involvement. 3. Prohibition of Political engage in politics. Hyundai Marine does not A. B. A. 4. Efforts to Reform Traffic System system. Hyundai Marine endeavours to reform the traffic A. Resolution 5. Participation in Environmental Problem Efforts Hyundai Marine is an active participant of environmental problem resolution activities. A. 6. Contribution to the Development of Insurance Industry Hyundai Marine must exert best of its efforts to find and improve new systems for the development of the insurance industry. The company must respect social ideals of the region and perform business Keeping in mind that volunteer work is part of company’s social Keeping in mind that volunteer work is part of company’s work and responsibility, the company must engage in various volunteer maximum natural disaster rescue efforts a foster an environment in which participation can take place. As a member of the society, the company must participate as a group and the employees must engage in voluntary works as individuals for self- realization and as a sign of customer service. The company must perform tasks which contribute to academics, arts, culture and sports in the interest of the society. The company must contribute to the society by providing jobs and paying taxes and, at the same time, engage in various welfare activities such as helping the poor. the holder of the trademark and, therefore, must be avoided. the holder of the trademark and, as novels, thesis, music, paintings, It must be noted that works such and computer programs which tend to photographs, illustrations, characters are copy righted by the author. embody individuality and creativity, under copyright laws and therefore must Copy righted works are protected of the author. The company must only use not be used without permission laid down in the contract with author; copyrighted works within the limits otherwise, it will be charged with violating copyright laws. by the A violation of copyright law may result in restriction or damage claim author; therefore violation of copyright law must be avoided. 2. Observing Regional Laws The company must respect the laws and customs of the region. A. A. B. C. D. Corporate Responsibility for Society and Corporate Responsibility for Society Nation and 1. Contribution to national economic development the society national In contributing to prosperity of the society and with its economic development in accordance establish a management policy, Hyundai Marine seeks to and sense of community among regional residents region by performing tasks which are beneficial to the making ethical and reliable social contributions. C. D. E.

HYUNDAI MARINE SUSTAINABILITY REPORT 2004-2005 절취선

Customer Survey of 2004-2005 Sustainability Report

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Be The Hi 78 I 79 CONTACT US Tendom Associates Inc. : Design by To carry out the tasks involved in producing the sustainability report, Hyundai Marine created a task force, under the Hyundai Marine created a task force, under in producing the sustainability report, To carry out the tasks involved We expect to be familiar with the specialization and reporting methods of sustainability management in the future. We expect to be familiar with the specialization Postal code number : 110-731 Hyundai Marine & Fire Insurance Co., Ltd. 178 Sejongno, Jongno-gu, Seoul, Korea Compliance Department, Compliance Team, Sustainable Management Task Force Tel : 02-3701-8920 Fax : 02-735-6607 E-mail : [email protected] Home Page: www.hi.co.kr Published by : Compliance Department, Compliance Team, Sustainable Management Task Force Published by : Compliance Department, Compliance Team, Sustainable Management Task Date of Publication : October 2005 CONTACT US Please contact us if you have any queries about Hyundai Marine’s Sustainability Report. Please contact us if you have any queries about Currently, the Compliance Team of the Compliance Department is in charge of the sustainability report. Currently, the Compliance Team of the Compliance supervision of the Compliance Department, consisting of employees from the Corporate Planning Dept., Public Relations Team, from the Corporate Planning Dept., Public Relations Department, consisting of employees supervision of the Compliance Support Dept., Dept., CS Promotion Dept., Auto-Claims Resource Development Dept., General Affairs Personnel Dept., Human and reviewed Dept. who gathered, investigated, drafted Actuarial Dept. and finance & Accounts Marketing Actuarial Dept., and reliable department enabled us to provide accurate Cooperation between the task force and relevant necessary information. attempts to Sustainability Report, Hyundai Marine parties. Through the publishing of 2004-2005 information to the interested management on the occasion of 50th anniversary. strive towards its objective of realizing sustainability This report is printed on recyclable paper.

www.hi.co.kr

178 Sejongno, Jongno-gu, Seoul, Korea Tel. 1588-5656