FY2007 LIG INSURANCE ANNUAL REPORT

FY2007 ANNUAL REPORT

Leaping Forward from Good to

Great

LIG Tower 649-11, Yeok-sam-dong, Gang-nam-gu, Seoul, 135-550 Korea Tel: 82-2-6900-2504 Fax: 82-2-505-136-0415 www.lig.co.kr
Leaping Forward From
Good to Great

CONTENTS

04 Corporate Profile
06 Financial Highlights
08 Letter to Our Shareholders
12 Board of Directors
14 Vision:
Pursuing Great Dreams
Over the years, LIG Insurance Co., Ltd. has established and maintained its good reputa-
16 Results:
Producing Great Value
tion of being one of the major and leading insurance groups in Korea. While grateful for
18 Challenge:
Taking on Great Challenges
this reputation, LIG Insurance will not settle for just being a good company. Striving to 20 Product & Service:
Promoting Great Passion
be better than good, LIG Insurance will Leap Forward from being a Good Company to 22 Community Service:
Fulfilling Great Responsibility
being a Great Company through Building Great Dreams via a new vision, Producing 25 LIFE IS GREAT
26 Management’s Discussion & Analysis (MD&A)
Great Values in its various insurance policies, Taking On Great Challenges of new busi- 35 Financial Section
106 Company History
ness and overseas market expansion, Promoting Great Passion for innovative and creative
108 Organizational Chart

products and services, and Fulfilling Great Responsibility to the community. 109 Corporate Directory
FY07 ANNUAL REPORT Leaping Forward from 4_ 5
Good to Great

CORPORATE PROFILE OF LIG INSURANCE

3 Promises for a Better Future
ORANGE: Service
Beyond providing long-term, automobile, and commercial insurance policies, LIG
Insurance strives to fulfill and protect its clients’ valuable hopes and dreams. The compa-
BLUE: Partner
ny exhibits its legitimacy and durability as a premier finance group through maintaining
its Stability, Scale, Familiarity, Humanity, Warmth, and Optimism with continuous
GREEN: Family
efforts. The new corporate identity called “Hope Clouds” logo, a combination of orange,
blue, and green circles, does not only reflect the progressive and dynamic nature of the
Orange circle represents the company spirit and dedication to provide wide range of services
that fulfill clients’ individual and specific needs for happiness, pleasure and the realization of
their hopes.
Blue circle represents partnership between LIG Insurance and its shareholders as well as its pur-
suit to secure shareholders’ faith and confidence in LIG Insurance. The circle also embodies the
company’s promise of a transparent and proper corporate management and attentiveness
towards shareholders’ opinions and suggestions.
Green circle represents LIG family’s growth, vitality, and promises and hopes of a brighter
future. LIG Insurance values and supports its employees by practicing management based on
principles of humanity.

company, but symbolizes the special relationships between its clients, shareholders, and New Corporate Identity logo is comprised of the company name and a graphic icon that reflects the new image of
LIG insurance
employees as well. LIG Insurance promises to build a better future by making hopes and

dreams come true for its clients, shareholders, and the rest of LIG family alike.

Legitimacy & Durability of LIG Insurance

Exhibits our efforts to maintain company's Stability, Scale, Familiarity, Humanity, Warmth, and Optimism

New Brand Identity of LIG Insurance “Always Ahead”

Represents our determination to stay a Positive, Progressive, Knowledgeable, Sophisticated, Transparent, and
Youthful Company
Delivery Value of LIG Insurance “Life is Great!”
Illustrates LIG family's willingness to always go beyond and take one step further to accommodate, enlighten, and
nurture our clients and their life, and thus enable them to realize the importance of life
Directional Value of LIG Insurance “Leading Insurance Group”
Reflects our future role in leadership as we strive to become the number one insurance and finance group

Business Domain of LIG Insurance

Beyond auto, fire and marine insurance policies, LIG Insurance will pursue prospective business areas in the future
FY07 ANNUAL REPORT Leaping Forward from 6_ 7
Good to Great

Financial Highlights

(KRW in billion)
* Direct Premiums Written *Trend of Net Income *Condensed Income Statement
(KRW in billion)
FY05 FY06 FY07
(KRW in billion)

124.7 137.6
Direct Premiums Written 3,484.9 3,924.7 4,216.7
Adjusted net income
Net income Net Premiums Written 2,983.8 3,333.0 3,609.5
Net Premiums Earned 2,937.8 3,335.6 3,601.6
Losses 2,359.0 2,789.1 2,892.0
Loss Ratio*1 80.3% 83.6% 80.3%
4,216.7
3,924.7

Net Expenses 713.9 807.4 828.8

3,484.9

Expense Ratio*2 24.3% 24.2% 23.0%

66.1 Underwriting Income*3 -135.2 -260.9 -119.3
Combined Ratio 104.6% 107.8% 103.3%
Investment Income 228.0 279.8 298.0
35.5

Net Increase in Catastrophe Reserve 30.6 14.0 12.9

10.1 24.1

Ordinary Income 50.8 9.6 155.6

Net Income 35.5 10.1 124.7
FY05 FY06 FY07 FY05 FY06 FY07
Adjusted Net Income*4 66.1 24.1 137.6
*Adjusted net income-net income plus increase of
catastrophe reserve Adjusted ROE*5 9.4% 3.3% 16.5%

*Combined Ratio *1_ Losses / Net premiums earned

(%) *2_ Net expenses / Net premiums earned
104.6% 107.8% 103.3% *3_ Before subtracting out net increase in catastrophe reserve
*4_ Net increase in catastrophe reserve + Net income
*5_ (Net increase in catastrophe reserve + Net income) / Average of (Total Shareholders’ equities + Catastrophe reserve)

FY07 ANNUAL REPORT (KRW in billion)

*Condensed Balance Sheet
FY05 FY06 FY07

FY05 FY06 FY07

Leaping Forward from Invested Assets 4,343.6 4,863.8 5,878.2

Good to Great Total Assets

Policy Reserve
5,369.1
3,947.3
6,138.9
4,655.2
7,306.3
5,401.5
Catastrophe Reserve 333.9 347.9 360.8
*Gross Investment Yield Total Liabilities 4,968.5 5,749.0 6,740.0
(%)

6.9% 7.3% 6.7% Total Shareholders' Equities 400.6 389.9 566.4

Adjusted Shareholders' Equities*6 734.5 737.8 927.3
Adjusted Book Value per Share*7 (KRW) 13,573 13,634 17,134

*6_ Total Shareholders' equities + Catastrophe reserve

*7_ (Total Shareholders' equities + Catastrophe reserve) / No. of outstanding shares

FY05 FY06 FY07

*Before subtracting investment related expenses
FY07 ANNUAL REPORT
Letter To Our Shareholders
As we conclude the first 50 years of growth and expansion, with the
generous support from our clients and customers this fiscal year, LIG
Insurance wishes to prepare and advance into the next 50 years, still
alongside our customers.
Dear Shareholders,
As I express my sincere gratitude towards you
for your steady interest in and support for our
company, I would like to promise to you that
LIG Insurance Co., Ltd. will return your good-
will with continuous growth and development
accompanied by shareholder value driven and
transparent management.
Looking back at the state of the market during
the last fiscal year, the spell of high-growth and
low prices world economy era was ended by the
sub-prime crisis and a sudden rise in interna-
tional raw material prices. And the domestic
economy GDP growth rate remained at last
year’s level due to slowdown in domestic market
growth and decline in export growth.
Despite these unfavorable market conditions,
the insurance industry managed to secure .
trillion won in direct premiums written, up by
.% from the previous year, with basis in high
growth of long term insurance. Moreover, the
industry achieved the highest returns in years
with a net income that exceeded one trillion
won by improving profitability and off-setting
the decline in automobile loss ratio.
LIG Insurance designated the year  as the
“First year of Sustainable Growth” and pursued
to produce this outcome via sound management
based on principles and fundamentals to satisfy
the expectations of our shareholders.
Leaping Forward from 8_ 9
Good to Great
Through these efforts, LIG Insurance was able
to improve the expense ratio, which had been
the greatest weakness for the company over the
years, by .%p and to improve the automobile
loss ratio by .%p since last year, and thus sub-
stantially improve its profit.
Eventhough it experienced a decrease in market
share, LIG Insurance was nonetheless able to
deliver great results in a form of net profit of
. billion won, and to increase the gross assets
by ,. billion won to ,. billion won since
last year. The company was able to do this while
maintaining a solid financial structure, with its
solvency ratio increasing by %p from last year
and reaching .%, demonstrating sound
financial managment and control mechanisms.
I believe that LIG Insurance was able to achieve
these twin successful outcomes of expansion and
prosperity due to the generous support you have
bestowed upon us. Therefore, let me once again
sincerely thank all of you.
FY07 ANNUAL REPORT
Honorable Shareholders!
With the revision of the insurance business law
and the possibility of life and non-life insurance
cross selling from August , we expect even
greater competition within the financial indus-
try with the Capital Market Consolidation Act
becoming effective in February .
In addition, we anticipate that greater reinforce-
ment of sound regulation and control mecha-
nisms, accompanying the implementation of
Risk Based Capital (RBC) and introduction of
the Cash Flow Pricing, are going to be ever more
important for improving risk management and
cost structure this year.
In response to these challenges, LIG Insurance
has designated year  as the “Year of
Solidifying Growth,” a second phase of sustain-
able growth, and has planned to promote man-
agement strategies centered around market, cus-
tomer, and marketing perspectives.
Through substantively promoting these manage-
ment strategies, we hope to achieve and attain
this year’s ordinary income goal of  billion
won and insurance sales of . trillion won,
thus accomplishing a year of a greater growth of
both sales and profit, built upon last year’s rev-
enue structure.
LIG Insurance will focus on greater expansion of
customer base and growth power, advancement
of management capacity for profit improve-
ment, enforcement of responsible executive
management, and development of strong corpo-
rate culture as our management policy, as a ways
to achieving this year’s financial goal of promot-
ing sustainable growth.
Furthermore, advancement into brokerage busi-
ness, with the preliminary permit obtained in
May  made providing comprehensive finan-
cial service possible for LIG Insurance in the
financial environment that is changing rapidly
due to the Capital Market Consolidation Act
becoming effective. By creating synergy between
the companies, LIG Insurance expects to have
the opportunity to expand and develop one step
further.
Our Shareholders!
FY08 is a very significant year for LIG Insurance
since we celebrate the 50th Anniversary on th
of January, .
As we conclude the first  years of growth and
expansion, with the generous support from our
clients and customers this fiscal year, LIG
Insurance wishes to prepare and advance into
the next  years, still alongside our customers.
By remaining faithful to our company’s primary
mission, LIG Insurance will incorporate and
promote customer value enhancement in its
management policy, and in return, we wish to
Leaping Forward from 10_ 11
Good to Great
further solidify our clients’ confidence in the
market. Again, we ask all of you for unwavering
interest in, and support for, LIG Insurance as we
face this turning point.
In return, LIG Insurance will fulfill corporate
social responsibilities by continuously sharing
management, and our entire staff will do their
best to receive greater love and trust from all of
our shareholders and customers.
Once more, LIG Insurance would like to ask for
your unwavering support and guidance, and I
sincerely wish you and your family the best of
health and happiness.
Thank You!
June 2008
CHA-HOON KOO
Chairman of the Board of Directors
CHA-JOON KOO
Vice Chairman & Chief Executive Officer
WOO-JIN KIM
President & Chief Executive Officer
FY07 ANNUAL REPORT Leaping Forward from 12_ 13
Good to Great

Board of Directors

Cha-Hoon Koo Cha-Joon Koo Woo-Jin Kim Choon-Keun Choi Nam-Sik Lee Kyung-Han Kim
Chairman of the Board of Directors Vice Chairman & CEO President & CEO Outside Director, Attorney, Nara Law Outside Director, President, Outside Director, Chief Editor, Ajnews
Jeonju University

Joong-Won Kwon Byung-Chul Choi Jae-Wook Chung

Managing Director Outside Director, Advisor, Outside Director, Professor,
Kim & Chang Sejong University
FY07 ANNUAL REPORT
VISION_
PURSUING GREAT DREAMS
LIG Insurance pursues great dreams
in quest to become the top Insurance
and Finance Company through delivering high growth
and profitability, providing great values,
displaying immense growth potential,
and conveying prestigious corporate image.
Leaping Forward from 14_ 15
Good to Great
LIG Insurance Co., Ltd. strives to become the Number Showcasing Great Growth & Profitability
One Insurance and Finance Group that provides the LIG Insurance will continue to pursue growth and prof-
greatest confidence and satisfaction to its Clients, itability not just in aspects of quantity but also by achiev-
Shareholders, Employees, and Partners. LIG Insurance ing the highest levels of quality.
promotes customer-oriented management that involves
planning and appraising all corporate management activ- Providing Great Value
ities from the customers’ perspective, combines competi- LIG Insurance will act as a competent partner to provide
tive and winning management that strengthens core and satisfy risk and finance related needs of its clients.
capabilities with the establishment of outcome oriented
culture, and a transparent management that advocates Displaying Great Growth Potential
fairness, impartiality and transparency that in turn With the top professional members of great expertise and
ensures success in the long-run. passion, effective merit based compensation system,
strong performance driven corporate culture, and a
Pursuing the new vision, LIG Insurance will display great secure and efficient business operational system, LIG
growth and profitability, provide great value, demon- Insurance has great potential for pursuing further growth
strate great growth potential, and convey great corporate and development.
image.
Conveying Great Corporate Image
LIG Insurance will strive to become the most trust-wor-
thy and the best Insurance and Finance Group represent-
ing Republic of Korea abroad by maintaining a friendly
working environment where its employees continue to
have pride in it. Most importantly, LIG Insurance will
strive to become the company that highly values its
shareholders and places the greatest importance on
adhering to the highest standards and competence of cor-
Showcasing
porate management.
Great Growth &
PURSUING Profitability
GREAT In the process of actualizing the new vision, LIG
DREAMS
Insurance hopes to provide the most comprehensive
financial service and the highest level of confidence to its
Providing
clients, to promote the greatest shareholder profit
Great
Value through maximization of corporate value, to take a role
of an excellent company that provides employees the
Conveying greatest gratification and satisfaction, and to successfully
Great Corporate Displaying
Image Great Growth fulfill its social responsibilities through transparent man-
Potential
agement.
FY07 ANNUAL REPORT Leaping Forward from 16_ 17
Good to Great

RESULTS_

PRODUCING GREAT VALUE

LIG Insurance produces great value in numbers
as well as in its notable accomplishments
through effective management based on solid
principles and fundamentals.
Turnaround in Performance
LIG Insurance designated 2007 fiscal year as the “First
Year of Sustainable Growth” and achieved an excellent
outcome with a net income of 124.7 billion won by
employing profit driven management.
In observation of insurance operations profitability in
2007 fiscal year, LIG Insurance recorded total loss ratio of
80.3% and expense ratio of 23.0%, each improved respec-
tively by 3.3% and 1.2% from last fiscal year, and record-
ed combined ratio of 103.3%, up by 4.5% from the previ-
ous year.
agement, overall long term product changes,
allowance/fee system improvement, and voluntary retire-
ments in January 2007, the net expense ratio was 23.0%
in FY07, down by 1.2%p from the previous year.
Moreover, the gap between the average net expense ratio
of three competitors and the company was reduced from
2.2%p in FY06 to 1.1%p this fiscal year.
Credit Ratings
LIG Insurance received grade A-(Excellent) rating from
the A.M. Best Company on December 17, 2007. The rat-
ing reflects an excellent financial stability and risk man-

.
agement capacity on the level of Global Best Practice.
In terms of commercial insurance, LIG Insurance experi- Thus, LIG Insurance was once again recognized as the
Billion Won
enced growth of 0.8% with sales improvements in liabili- company of the world’s highest standard with high prof-
ty, accident, and casualty insurance policies and the itability and financial soundness. Furthermore, Standard
Net income

.%
decline of affiliates sales as the rate declines continuously.
The company recorded loss ratio of 59.3% in FY07 due to
the costly fire accidents including LG Chemical fire and
Yicheon freezer warehouse fire.
Solvency ratio
& Poor’s International LLC gave another positive evalua-
tion of excellent market profile of LIG Insurance as one
with a high growth potential and performance improve-
ment. The company maintained the BBB+(Stable) rating
in its Financial Strength & Long-term Counterparty

A - (Excellent)
As for long term insurance, the company strengthened
underwriting guidelines through downward adjustment
of underwriting limit on high loss ratio organizations and
Credit Ratings on January 23, 2008.

Credit rating from A.M Best coverages in order to improve long term insurance risk
loss ratio. Moreover, strengthening the experience data

+ analysis as the company completed to construct the expe-

BBB (Stable)
Credit rating from Standard & Poor’s
rience rating system in November, 2007, LIG Insurance
achieved loss ratio of 83.9%, improved by 2.4% from the
previous year.

In the case of automobile insurance, as a result of deploy-

ing multilateral loss reduction activities to cope with high
loss ratio, such as rise in the rate, strengthening of under-
writing deliberation, sophistication of damage assessment
and uncovering insurance fraud, the company improved
the loss ratio by 7.6%p from the last fiscal year to 76.4%.

In addition, due to efforts including tighter budget man-

 ANNUAL REPORT
CHALLENGE_
TAKING ON
GREAT CHALLENGES
LIG Insurance takes on great challenges to
further promote sustainable growth and
reconfirm its identity as a leading Insurance and
Finance Group in a rapidly changing market 2008 LIG Expedition of Hope
environment through overseas market expansion
and strategic management.
LIG Insurance is faced with a New Challenge to pursue LIG Insurance strives to become a company with compet-
long term strategy of becoming a premier insurance and itive and innovative group of professionals, who value
finance institution by innovation while maintaining its clients and execute plans effectively and efficiently to pro-
reputation and brand identity as a top insurance compa- duce successful results for its customers and to establish
ny with a long and highly regarded history. competitive corporate culture in order to tackle new chal-
lenges and actualize its “Always Ahead” vision.
[TAKING FOUR STRATEGIC
DIRECTIONS TO LAY THE CORNERSTONE OF
SUSTAINABLE GROWTH]
{* EXPAND CUSTOMER BASE &
SECURE GROWTH POWER
_Strengthen sustainable growth of each channel
and Focus on clients and customers to create a
better working system
{ * STRENGTHEN BUSINESS CONTROL FUNCTION FOR
PROFIT IMPROVEMENT
_Strengthen competitiveness in the claims & cost
control of automobile line and Improve efficiency
in the sales expense structure
{* PURSUE RESPONSIBLE MANAGEMENT
_Establish powerful corporate culture and
Strengthen management control system
{ * EXPLORE NEW MARKET AND/OR BUSINESS
_Set up an infrastructure to provide total and com-
prehensive financial services by advancing into
brokerage business
Leaping Forward from 18_ 19
Good to Great
[LIG CHALLENGE: OVERSEAS EXPANSION]
Currently, LIG Insurance manages 1 branch office, 2 cor-
porate offices, and 6 offshore offices in 5 countries
including the United States and Indonesia. The company
established its branch office in New York in 1990 and
founded its joint corporate office, PT LIG Insurance
Indonesia, in Jakarta in 1997. In 2004, LIG Insurance
acquired a part of United Insurance Company of
Vietnam. In November 2005 the company founded a cor-
porate office, LIG Management Services Incorporated, in
New Jersey to better facilitate and execute operations of
its branch office in the United States. In addition, the
company set up liaison offices in 6 different regions,
including Los Angeles, Tokyo, Ho Chi Minh City, Hanoi,
Beijing, and Shanghai, to collect data on the current state
of the insurance markets in these regions.
With increasing number of domestic companies seeking
new markets abroad, LIG Insurance would like to direct
its energy towards providing insurance service in overseas
markets by utilizing its foreign offices network. Besides,
in order to secure new growth sources in reaction to the
slowdown of growth and increased competition in the
domestic insurance market, the company plans to expand
overseas to Vietnamese and Chinese markets.
Chinese Insurance market has been developing rapidly
and is expected to become the largest Asian market. Thus,
along with LG Group, other Korean corporations and
companies have been investing in this market. In order to
take advantage of this growth potential, LIG Insurance
has applied for approval from China Insurance
Regulatory Commission (CIRC) to establish a corporate
office in Nanjing by 2009. Vice Chairman Koo met with
Mayor of Nanjing, Jang Hong Kun, on February 6, 2007,
and initiated talks on establishing an LIG corporate office
in Nanjing. On April 17, 2007 Vice Mayor of Nanjing, Jin
Dao Chang, visited LIG Insurance Headquarters in Seoul
and entered into a contract with LIG Insurance. As of last
January, LIG Insurance completed the initiation proce-
dures for establishing independent corporate office in
China and is now awaiting the Chinese government’s
authorization. The company is gearing towards operating
this corporate office in China, and plans to expand fur-
ther in the Chinese Insurance Market, once its corporate
office in Nanjing is successfully established.
FY07 ANNUAL REPORT
PRODUCT_
SUPPORTING
GREAT
PASSION
LIG Insurance supports the great
passion of its employees for
innovation, creativity, and new
visions by pursuing and tackling new
challenges, promoting and creating
new products and brands while
continuing to maintain its distinctive
corporate identity.
With competitive and winning corporate culture and tal-
ented employees who effectively and efficiently execute
new visions and manage new challenges, LIG Insurance
constantly creates and promotes new products and
brands. Currently, the company offers vast range of ser-
vices: Travel, Study Abroad, and Leisure Insurance;
Drivers and Casualty Insurance; Health & Children
Insurance; Pension & Savings; Fire Insurance;
Comprehensive & Consolidated Insurance and
Bancassurance and Affiliated Insurance. LIG Insurance
will continue to provide more innovative and customer
oriented service and products as well as to improve its
existing insurance policies.
[LONG TERM INSURANCE]
LIG Insurance provides great variety of long term insur-
ance policies including comprehensive, savings, disease,
and pension insurance. The most favored long term
insurance is LIG Well Being Insurance which is a compre-
hensive insurance plan. LIG Health Care Health
Insurance that covers illness, disease, and casualty and
LIG Fire Insurance, a savings plan, are also among the
popular brands often chosen by the customers. Recently,
the company developed a brand new insurance policy,
LIG Premium Gold Plan Insurance, targeting the growing
retirement market. Without apportionment but with
affordable cost, this retirement plan covers great range of
medical costs, including hospitalization due to minor
injury or illness, burn, fracture, and nursing expenses for
Alzheimer patients. LIG Premium Gold Plan expires at
the age of 100 and guarantees full coverage on medical
costs for any casualties or illnesses.
{ *LIG WELL BEING INSURANCE
_Comprehensive Insurance Plan
{* LIG HEALTH CARE HEALTH INSURANCE
_Illness & Casualty
{* LIG FIRE INSURANCE
_Savings Plan
{* LIG PREMIUM GOLD PLAN INSURANCE
_Retirement Plan
[AUTOMOBILE INSURANCE]
Magic Car Automobile Insurance (Basic, Life, & Luxe)
Starting out first as an automobile insurance emergency
call service called “Magic Car Service” in March 1996,
LIG Insurance launched “Magic Car Insurance” in 2002.
Ever since its debut, “Magic Car” brand has grown rapid-
ly every year providing competitive and quality services
and paving the way for becoming the leading automobile
insurance.
LIG Insurance has continuously provided foundation for
growth with exclusive marketing strategy, such as estab-
lishing 500 emergency call service franchises providing
the best service to the customers. Our efforts have result-
ed in winning Annual Brand Awards in 2004 and both
First Brand Awards and Best Brand Award in 2005.
With the launch of a new and upgraded “Magic Car”
based upon comprehensive automobile insurance con-
sulting, LIG Insurance provides new specialized services
of basic, life, and luxury type according to family struc-
ture, driving style, and risk indicators. Number of enter-
prises affiliated with Magic Car will be increased along
with number of accident site dispatchers. In addition, the
company will strengthen customer service by innovating
call center tasks and intensify customer service education
for call center employees. Last but not least, LIG
Insurance will implement six sigma strategies in its
Enterprise Value Creation (EVC), and provide technolo-
gy related education for all its employees to improve and
strengthen current management system and strategies.
[COMMERCIAL INSURANCE]
LIG commercial insurance, which professionally manages
corporate risks, is classified into property, marine, and
casualty insurances. All insurance policies provide real
Leaping Forward from 20_ 21
Good to Great
guarantees with less than 3 years of insurance period.
Property Insurance covers loss of or damage to corporate
asset or property incurred by unexpected disasters.
Property insurance policies include fire, package, technol-
ogy, comprehensive, and theft insurances.
Marine insurance is a product that compensates loss from
sudden and unexpected accidents during ownership of a
vessel or transport of a cargo via sea or air, and it includes
marine, shipping, transportation, aviation, and space
insurances.
Casualty insurance compensates for wide range of risks
including liability, injury and disease of employees, and
also new varieties of risks incurred during operation
activities of corporations or professionals. Representative
products of casualty insurance include professional liabil-
ity, product liability, workers liability, and casualty insur-
ance policies. The market for casualty insurance will
expand and grow with the emergence of variety of new
risks in the future.
[OTHER SERVICES]
Customer Relations Management and
Automobile Claims Support
The company has been operating the Customer Relations
Management Team since April 2002 with the aim of valu-
ing and reflecting clients’ perspectives about the scope
and quality of its marketing, customer service, business
practices, and other management activities. Additionally,
LIG Insurance has created the Automobile Claims
Support Team to provide better service to its clients and
to differentiate its indemnity service from the competi-
tors in the industry. Through systemization of automo-
bile indemnity compensation services and business
processes, LIG Insurance services one of the most effi-
cient emergency dispatch units, composed of the two
automatic response unit bases fully accommodated with
effective electronic maps, SMS, position tracking system,
24hour emergency unit and indemnity consultants on
standby, and an automated monitoring system to check
call transactions at all times.
FY07 ANNUAL REPORT
COMMUNITY SERVICE_
FULFILLING
GREAT RESPONSIBILITY
LIG Insurance fulfills its great responsibilities to the society through
wide range of community service activities, scholarship foundations and public funds,
and athletic and cultural sponsorships.
2008 6th LIG Korea Open Marathon
THROUGH SHARING MANAGEMENT, LIG
INSURANCE FULFILLS SOCIAL
RESPONSIBILITIES AND COMMITMENTS
Recognizing that companies of today have corporate
responsibilities and commitments to service the commu-
nity and improve our society, LIG Insurance strives to
fulfill its role as a responsible corporate citizen and to
contribute to our society via various channels.
[COMMUNITY SERVICE]
Promoting Love through Sharing
Expanding on existing community service activities, LIG
Insurance launched L. Flower Volunteers in October
2005 with LIG Insurance employees and sales representa-
tives. Currently more than 90 LIG Volunteer Groups
throughout the nation participate and engage in various
community services and activities every month. As a part-
ner who recognizes and values importance of life, LIG
Volunteer Groups prefer to assist those in need through
direct participatory volunteer work rather than merely
providing financial assistance or relief aid.
[SCHOLARSHIP & FUNDRAISING]
Delivering Hope through Scholarship Foundation
LIG Insurance takes an active role in social welfare initia-
Leaping Forward from 22_ 23
Good to Great
tives, assisting young heads of households, impoverished
children, and children of traffic accident victims. The
company reserves certain percentage of the premium
from various insurance plans for scholarship funds, joint-
ly operated with the Network for Green Transport, Korea
Association of Road Traffic Victims, Korean Red Cross,
Korea Welfare Foundation, and other social welfare orga-
nizations.
Marathon Love Fund
100 won is raised for every meter Vice Chairman Koo or
each LIG Insurance employee runs, and the proceeds go
to the “Marathon Love Fund” which helps children of
traffic accident victims as well as other children in need.
LIG Insurance Public Fund
LIG Insurance has reserved certain portion of the premi-
um from the sales of “KkoKkoMa Children Insurance” as
public fund to support “House of Hope” projects. The
company also operates computer classes for children of
traffic accident victims and hosts picnic days for impover-
ished children.
LIG Hope Fund
Since September 2007, LIG Insurance employees have
been voluntarily donating to the “LIG Hope Fund,” and
the company has been contributing equal amounts
through ‘matching grant’ mechanism in cooperation with
“Save the Children” social welfare organization in sup-
porting and assisting children suffering from rare disease
post radiation scoliosis. On February 25th and April 7th
of 2008, LIG Insurance employees delivered “LIG Hope
Fund” to Yoon-Joo Park and Sung-Goo Kun, two chil-
dren suffering from postradiation scoliosis, to assist in
covering their surgical and other medical costs.
LIG Insurance Hanmaum (United Heart) Scholarship
Since April 2000, certain portion of auto-paid premiums
from the ‘Best Accident Insurance’ has been set aside to
be delivered to Korea Welfare Foundation as “LIG
Insurance Hanmaum (United Heart) Scholarship.”
FY07 ANNUAL REPORT
L_The completion of 6th "House of Hope" R_ Hye-Yong Choi, Golfer, Sponsored by LIG Insurance
House of Hope
LIG Version of Habitat for Humanity - Building
“Houses of Hope” for Children
Since constructing the first “House of Hope” in January
2006, Senior Executive Vice President and LIG employees
have planted seeds of hope for underage children who
suffer from estrangement, abuse, and insufficient living
conditions. The company recently completed the con-
struction of the 6th “House of Hope,” and it will contin-
ue to support this project and build more “Houses of
Hope” for the children in need.
[ATHLETIC AND CULTURAL SPONSORSHIPS]
LIG Insurance values the importance and the need to
develop and nurture art, culture, and sports. Thus, the
company provides and supports various sponsorships to
athletes and artists in Korea.
Sponsor of Alpinists & Explorers
LIG Insurance has been supporting the explorers Young-
Seok Park (who became the first person in the world to
achieve the “Grand Slam” of mountaineering in 2004)
and Eun-Sun Oh. Rather than just providing financial
patronage to these explorers, the company has shown
efforts to take part and interest in their expeditions and
activities.
Sponsor of Young Dancers
LIG Insurance has been sponsoring young dancers since
Leaping Forward from 24_ 25
Good to Great
LIFE IS GREAT!
LIG Insurance Company Limited strives to become
the Number One Insurance and Finance Group
that provides the greatest confidence and satisfaction to its Clients,
Shareholders, Employees, and Partners.
1998 and hosting annual dance performances at LIG Art
Hall, providing opportunities for the dancers to develop
and showcase their talent and creativity. The company
has also been attempting to lay the bridge for these
dancers to present their talent and introduce Korean
Dance & Arts on international stage.
New Brand Identity of LIG Insurance
Sponsor of Golfers
“Always Ahead”
In April 2006, LIG Insurance the company launched a
Represents our determination to stay as Positive,
professional golf team with Young-Joo Kim to produce
Progressive, Knowledgeable, Sophisticated, Transparent,
and sponsor prospective young and talented golf players
and Youthful Company
for KLPGA. Hye-Yong Choi, one of the professional
golfers sponsored by LIG Insurance, received the gold
Delivery Value of LIG Insurance
medal for women’s team event at the 2006 Asian Games
“Life is Great!”
held in Doha, Qatar. This year, Choi came in first at the
Illustrates LIG family’s willingness to always go beyond
KLPGA tour and ranked second on the point scale for
and take one step further to accommodate, enlighten,
this season’s race towards the ‘rising star’ title.
and nurture our clients and their life, and in return,
enable them to realize the importance of life.
LIG Insurance Professional Volleyball Team
Established in June 24, 1976, LIG Insurance volleyball
Directional Value of LIG Insurance
team “LIG Greaters” has been making immense strides
“Leading Insurance Group”
with its outstanding records both domestically and
Reflects our future role in leadership as we strive to
internationally. LIG Insurance also opened “Greaters
become the “Number One Insurance and Finance
Historium,” the one and only volleyball museum in
Group”
Korea, in Gumi City. LIG Greaters Volleyball Team
strives to advance the development of Korean sports and
bring enjoyment to the Korean public.
FY07 ANNUAL REPORT Leaping Forward from 26_ 27
Good to Great

Management’s
Discussion & Analysis

I. FORWARD LOOKING STATEMENT
The following discussion and analysis covers forward-
looking data as well as the past performance. Depending
on the various factors, the actual results may differ mate-
the banking sector, lending banking players have tried to
generate future revenue stream by non-bank financial
services M&A, as lending market growth has slowed.
management team sees that FY08 will be another year of *Trend of market share by business line
sustainable growth. In order to attain this goal, the man-
agement will continuously focus on customer base 18%
17.5% 16.6%
expansion, on improving company’s distribution chan- Commercial

rially from anticipated results expressed in this report. Under such challenging business conditions, Korean nels, as well as on profit expansion. 15.7% 15.5%
Long-term 14.7%
Forward-looking statements included herein are made as non-life insurance industry accomplished excellent oper-
12.5% 11.8%
of the date hereof, and LIG insurance undertakes no ating results. This can be attributed to the insurer’s auto- Automobile 10.4%
obligation to update publicly such statements to reflect mobile loss ratio improvement backed by premium
14.8% 14.4%
subsequent events or circumstances. hikes, and strengthening underwriting activities. Also, III. RESULTS OF OPERATIONS 13.4%
Total
the non-life insurers wrote 31.4 trillion won of insurance In FY07, LIG Insurance posted 4,217 billion won of
Korean insurance companies including LIG Insurance policies with the written premium growth at 14.8% YoY. direct premiums written, up by 7.4% YoY. Looking into FY05 FY06 FY07
operate on a fiscal year basis. The fiscal year commences the details of the growth, LIG posted its Long-term insur-
on April 1 and ends on March 31 of the following calen- Since the management reshuffling, including CEO, exe- ance growth at 13.5% YoY and commercial line with
dar year. For reference, FY07 in our discussion refers to cuted in FY06, LIG made every effort to revamp the busi- 0.8% YoY. The 1.2% of diminished growth that appeared
*Product breakdown by direct
premium written
fiscal year ending March 31 2008. The terms “the compa- ness fundamentals. First of all, the company significantly in the automobile insurance line is due to de-emphasiz-
31.4% 28.9% 26.6%
ny”, “the insurer”, and “LIG” in this report all indicate improved its automobile loss ratio by adopting more ing of growth in automobile insurance line. In terms of
LIG Insurance Co., Ltd. stringent underwriting guideline. Secondly, LIG continu- sales mix, Long-term insurance business expanded fur-
60.0%
ously improved its profitability by enlarging the portion ther, accounting for 60.0% of the LIG’s total written pre- 53.4% 56.8%

II. OVERVIEW
In FY07, the world economy has continuously experi-
enced difficulties due to unfavorable factors such as
housing market downturn and global financial market
turmoil triggered by the US subprime crisis, China’s
monetary tightening, and soaring commodity prices.
of protection-type products. In addition, in order to mium (from a year ago). Automobile insurance shrank
improve cost efficiency, the management team executed to 26.6% from 28.9% from the previous year.
organization restructuring, rationalizing commission Commercial insurance edged down to 13.4%, down by
Automobile
scheme, and cutting down the overhead cost. With such 0.9%p a year ago. Overall, this change of sales mix well Long-term 15.1% 14.3% 13.4%
tremendous efforts, expense ratio greatly improved. represents LIG’s sustainable and profitable growth strat- Commercial
FY05 FY06 FY07
While the company’s direct premium written grew only egy. All in all, due to the improved automobile loss ratio,
7.4% YoY, its net profits jumped to 124.7 billion won LIG’s net profit expanded to 124.7 billion won, up by
from 10.1 billion won a year ago. This solid profit growth 1,134.7% YoY.

124.7 137.6
Despite these overall adverse conditions, Korea’s eco- is mainly attributable to LIG’s key strategy which focuses
nomic growth remained at 5%, at similar level to previ- more on profit growth than sales growth. *Trend of direct premiums written *Trend of net income
(KRW in billion) (KRW in billion)
ous year, on the back of recovery in consumption and

4,216.7
Adjusted net income
solid exports. Also, domestic equity market continued its FY08 will be a challenging year for Korean non-life insur-
Net income

3,924.7
rally owing to flush liquidity in the market as well as ance given the Insurance Business Act amendment,

3,484.9
strong corporate earnings. insurance cross-selling liberalization, and the cash flow

66.1
pricing. In addition, with ever growing importance of
In the domestic financial sector, there has been a series of RBC (Risk based capital), issues of insurance company

35.5
changes. Securities and asset management industry sig- solvency and cost structure improvement are expected to

10.1 24.1
nificantly grew, given market expectations of the positive be the critical ones in the field of insurance.
effect of the Capital Market Consolidation Act, which
FY05 FY06 FY07 FY05 FY06 FY07
will take effect in 2009. Korean life insurers are finally In this environment, LIG will make every effort to
*Adjusted net income-net income plus increase of
coming out with IPOs from the second half of 2008. In achieve strong sales growth as well as solid profits. The catastrophe
 FY07 ANNUAL REPORT Leaping Forward from 28_ 29
Good to Great

IV. PERFORMANCE AND OUTLOOK BY Commercial insurance

BUSINESS LINE FY07 was another challenging year for commercial insur-
ers in Korea. The price competition in the commercial
Underwriting performance insurance is intensified and downward pressure on pre-
(KRW in billion) In FY07, Korean non-life insurers achieved significant mium rates continued causing profit deterioration.
*Summarized Income Statement profit improvements backed by the steep declines in the While experiencing slight reduction in property insur-
FY05 FY06 FY07
Direct Premiums Written 3,484.9 3,924.7 4,216.7 automobile loss ratio and continuing loss ratio improve- ance sales due to continuation of intensive price compe-

Net Premiums Written 2,983.8 3,333.0 3,609.5 ments in the long term line. Auto line’s earnings contri- tition and declining rate, LIG's premium volume in com-

Net Premiums Earned 2,937.8 3,335.6 3,601.6 butions were driven by the increase of earned premium mercial line increased by 0.8% to 564.6 billion won with

Losses 2,359.0 2,789.1 2,892.0 on the number of insured cars following premium hike, its market share at 16.6% compared to last fiscal year as a

Loss Ratio 80.3% 83.6% 80.3% slowdown of car accident rate, and underwriting disci- result of revenue growth in liability, accident, and casual-

Net Expenses 713.9 807.4 828.8 pline. Profitability of Long-term insurance business has ty insurance policies.

Expense Ratio 24.3% 24.2% 23.0% expanded by increasing the proportion of risk protec-

Underwriting Income * -135.2 -260.9 -119.3 tion-type products. As regards underwriting, LIG posted its loss ratio in the

Combined Ratio 104.6% 107.8% 103.3% commercial insurance business for FY07 at 59.3%, which

Investment Income 228.0 279.8 298.0 All in all, LIG’s underwriting margin has improved. LIG is up by 0.4%p from the previous year. The main culprit

Net Increase in Catastrophe Reserve 30.6 14.0 12.9 recorded its combined ratio for FY07 at 103.3%, which is in the deterioration of the loss ratio was the increased

Ordinary Income 50.8 9.6 155.6 improved by 4.5%p from the previous year. LIG’s loss number of unexpected large-scale accidents. Expense

Net Income 35.5 10.1 124.7 ratio for FY07 went down to 80.3% from 83.6% a year ratio in the commercial insurance line deteriorated to

Adjusted Net Income 66.1 24.1 137.6 ago. Expense ratio dropped down by 1.2%p to 23.0%. 27.0%, up by 3.8%p. This margin deterioration was
attributable to continued price competition, and changes
*Before subtracting out net increase in catastrophe reserve
of reinsurance scheme.
*Trend of combined ratio
Loss ratio 104.6% 107.8% 103.3%
Expense ratio
LIG expects that competition within the sector will likely

83.6% 24.2%
remain tough, largely due to the profitability of commer-

80.3% 24.3%

23.0%
(KRW in billion)
*Summarized Balance Sheet
FY05 FY06 FY07 cial insurance line. However, LIG set its premium vol-
Invested Assets 4,343.6 4,863.8 5,878.2 ume goal at 600 billion won sales of new products in

80.3%
Deferred Acquisition Cost 321.5 450.8 528.7 FY08. LIG will try to expand its sales growth by innova-
Separate Accounts 238.4 334.5 450.1 tive product development as well as new market genera-
Total Assets 5,369.1 7306.3 7,320.4 tion. Also, LIG will step up its efforts to enhance its prof-
Policy Reserve 3,947.3 4,655.2 5,401.5 itability by carrying out appropriate reinsurance schemes
Reserve for outstanding claims 361.8 441.9 474.9 and underwriting policy in more optimal and strategic
FY05 FY06 FY07
Long-term insurance premium reserve 2,953.5 3,566.6 4,258.0 manners.
Unearned premium reserve 619.0 616.2 625.9
*Underwriting income FY05 FY06 FY07
(KRW in billion)
Reserve for participating policyholders' dividends 9.0 19.4 28.8
Excess participating policyholders' dividends 4.0 11.1 14.1

119.3
Catastrophe Reserve 333.9 347.9 360.8

135.2
Total Liabilities 4,968.5 6740.0 6,754.1
Retained Earnings 226.9 223.4 341.4
Equity Adjustments 93.0 85.4 143.5
Total Shareholders' Equities 400.6 389.9 566.4

260.9
Total Liabilites & Shareholders' Equities 5,369.1 6,138.9 7,306.3
*Before subtracting out net increase in catastro-
phe reserve
FY07 ANNUAL REPORT Leaping Forward from 30_ 31
Good to Great

*Direct premiums written of guidelines focused on profitability. Long-term insurance * Improving the product mix
commercial insurance and growth(Y/Y)
Looking ahead to FY08, automobile loss ratio is projected The Long-term line’s earnings contribution continued to * More stringent underwriting guideline
(KRW in billion)
to improve further due to decline in driving frequencies expand as the industry’s Long-term insurance business * Enhancing channel competitiveness
YoY 7.0% 6.2% 0.8%
DPW owing to skyrocketing gasoline prices, and underwriting soared by 19.9% in FY07. This solid growth across the * Strengthening salesperson oriented sales foundation thus nur-
discipline. However, business environment for automo- board was attributed to increased in-force premium as turing highly productive channel

564.6
bile insurance line will be challenging, due to no hike well as Long-term insurance-focused strategy by the
560.2 effect, rising market share of online discounters, and Insurance industry. LIG posted its Long-term insurance *Direct premiums written of Long-term
increasing incurred losses in the rise of prices. growth at 13.5% YoY with its market share at 14.7%, insurance and growth (Y/Y)
527.5

(KRW in billion) 20.8% 19.7% 13.5%

Additionally, LIG expects that the overall competition down by 0.8%p from the previous year. The diminution

2,530.5
YoY
within the sector will likely be as tough as it was in the in market share is partly due to increasing sales growth by DPW

2,228.8
past. competitors’ GA (General Agency) channel,but it is

1,862.3
mainly attributed to LIG’s adherence to its sales strategy.
FY05 FY06 FY07
LIG set a goal of 7% growth in FY08. In addition, LIG will In line with its sales strategy which focuses more on the
step up its effort to improve profitability in the automo- profitability than aggressive sales expansion, LIG has
*Combined ratio of commercial insurance bile insurance with stringent underwriting guideline and increased the proportion of profitable Long-term insur-
Loss ratio
Expense ratio 65.1% 82.1% 86.3%
reasonable premium policy. ance products by reshuffling commission schemes.
59.3% 27.0%
23.2%

FY05 FY06 FY07

In terms of loss ratio, it improved significantly by 2.4%p
*Direct premiums written of
40.7% 24.4%

58.9%

automobile insurance and growth (Y/Y) to 83.9%. This reduction in loss ratio was attributed to a
(KRW in billion) product mix shift toward risk-protection insurance type,
*Combined ratio of Long-term insurance
Loss ratio
YoY 105.3% 105.9% 101.7%
8.5% 3.7% -1.2% especially toward the high-margin integrated products Expense ratio
DPW

1,135.6

86.3% 19.6%
which could maximize the profit. The loss ratio in Long-

86.8% 18.6%

83.9% 17.9%
term line is expected to improve as the loss ratio of initial
1,121.6 premium has decreased. In terms of expense ratio in
FY05 FY06 FY07 Long-term insurance line, LIG turned a profit with over-
head cost saving scheme and decrease in sales and salaries
1,095.1

Automobile insurance expense.

In FY07, total automobile insurance premium written in
the industry grew by 12.0%, totaling 10,800 billion won.
For the same period, LIG insurance wrote 1,121.6 billion FY05 FY06 FY07
won of automobile insurance polices, decreased by 1.2%
from the previous year, and its market share was 10.4%, *Combined ratio of automobile insurance
down by 1.4%p from the previous year, due to tightened Loss ratio
Expense ratio 113.7% 117.6% 110.3%
underwriting activity and rise of market share in the on-
33.5%
In a modern society, the importance of privatized med-
ical insurance keeps growing as both the population and
proportion of aged in it increases. Thus compensation
demands for diseases and casualties are likely to increase
steadily.
FY05 FY06 FY07
Investment Performance
In FY07, domestic market interest rate has shown
upward movement, but the insurer’s actual investment
return has not improved. The problems in the US sub-

line channel. LIG increased premium rates and made In order to remedy the slowing Long-term line growth, prime mortgage market rattled the global financial mar-
79.2% 34.5%

76.4% 33.9%

efforts to increase the proportion of competitive prod- LIG is setting up a competitive sales channel to get to kets and subprime-related losses on valuation of deriva-
84.0%

ucts in its product portfolio by strengthening underwrit- more solicitors along with GA. The company will try to
ing guideline. As a result, automobile loss ratio improved improve its sales growth by preparing for cross selling
to 76.4% in FY07, versus 84.0% in FY06. Despite the which will be effective around the end of August 2008, as
trend of high accident rate being persistent, LIG’s loss well as rationalizing the commission scheme. In addi-
ratio for FY07 improved significantly. This improved loss tion, LIG will continuously endeavor to expand the
ratio is largely due to premium hikes, de-emphasizing of Long-term line’s earnings contribution by:
FY05 FY06 FY07
aggressive sales expansion, adoption of underwriting
tives increased. With the fall of market value of some
assets, Korean insurers have recognized derivatives loss
in FY07 and additional loss may arise. Like the other
industry peers, LIG recognized its collateralized debt
obligations (CDO) investment as impairment losses.
Although the possibility of further impairment losses
FY07 ANNUAL REPORT Leaping Forward from 32_ 33
Good to Great

cannot be ruled out in FY08, the loss is expected to be lim-
ited as US financial market has been regaining stability.
Overall return from the equity investment stood at the
Trend of investment income strophe reserve increased 3.7%. Asset soundness
(KRW in billion)
Despite the increased proportion of loan book among
LIG has enough capital base compared with the mini- the invested assets, LIG has shown a major improvement
*Invested assets mum required solvency margin requirements of 100% by in the aspect of asset quality. This is attributable to the

5,878.2
double-digit level on the back of the strong domestic Financial Supervisory Service (FSS). This implies that more stringent risk management reflected the impor-

4,863.8
4,343.6
market. Despite the upward trend of interest rate, reflect- LIG has around 222% of extra available capital, which tance of asset soundness. LIG’s NPL(Non-performing
ing the financial market volatility, the yield from the can cover unexpected accidents s and protect its policy loan) ratio increased to 1.5% as of March 2008 from
fixed-income assets remained at similar level to previous holders. 0.6% a year ago, due to slowdown of Korean economy.
year. The return on the loans slightly slowed due to inten- In FY08, the level of loan risk has been rising because of
sified competition. the real estate market contraction and economic slow-
down. In order to prepare for such unfavorable condi-
Amid these changes in the market, LIG reported its FY07 tions, LIG will adopt more conservative style on PF (pro-
FY05 FY06 FY07
investment yield at 6.7%, which is down by 0.6%p from ject financing) as well as stringent loan quality monitor-
the previous year, but still stayed at a relatively high level Trend of solvency ratio ing.
*Investment portfolio (KRW in billion)
in the industry. Despite the yield was slightly down,
invested assets grew by 20.9% YoY. All in all, LIG’s Bonds 36.0% 34.8% 32.2% *Solvency margin requirement *Trend of total loans
Loans (KRW in billion)
investment profit grew to 298.0 billion won, up by 6.5% Cash & Deposits
YoY. Equities

2,510.7
Real Estate 41.6%

450.3
37.9% 39.5%

405.3

1,957.8
LIG’s invested assets grew to 5,878.2 billion won, up by

367.3

1,669.4
20.9% from the previous year. In terms of portfolio allo-
4.0% 4.5% 5.0%
cation, LIG lowered the proportion of bonds and real 9.8% 10.0% 12.0%
estate, as well as overseas securities which are at increased 12.4% 11.1% 9.2%
FY05 FY06 FY07 FY05 FY06 FY07
risk. Instead, the proportion of loans and equities was
FY05 FY06 FY07
increased. LIG management will focus on efficient asset
allocation to secure stable investment margin from sav-
*Solvency margin *Trend of NPL

999.1

37.8
(KRW in billion)
ings-type products. Furthermore, the company will con- *Investment income
298.0

24.2
279.8

tinue to maintain investment strategy that focuses on risk

777.8

12.4
754.0
management.
228.0

LIG believes that controlling market risks is more impor-

tant than higher return during economic slowdown. In
FY08, in order to prepare for unfavorable investment
conditions such as high oil prices and inflationary pres- FY05 FY06 FY07
FY05 FY06 FY07
sure, LIG will reinforce its risk management program. In
FY05 FY06 FY07
addition, the company will focus on improving the qual- 221.9%
*Solvency ratio *NPL ratio
ity of its investment assets as well. Furthermore, the com- Capital adequacy
1.5%
pany will maintain the proportion of interest-bearing LIG’s solvency ratio increased to 221.9% as of March
205.3% 1.4%
assets on current level and decrease the proportion of 2008 from 191.9% a year ago. This can be attributed to
overseas bonds in its investment portfolio, and it will the rapid increase of earnings in FY07. LIG’s sharehold-
apply more stringent guideline for PF (project financing) ers’ equity as of March 2008 stood at 566.4 billion won, 191.9% 0.6%

in preparation for real estate market contractions. The increased by 45.3%. Adjusted shareholders’ equity
alternative investment will be also considered for its port- (=shareholders' equity plus catastrophe reserve) FY05 FY06 FY07 FY05 FY06 FY07

folio change. increased to 927.3 billion won, up by 25.7%, as the cata-

FY07 LIG Insurance ANNUAL REPORT

Financial Section
FY07 ANNUAL REPORT Leaping Forward from 36_ 37
Good to Great

INDEPENDENT AUDITORS’ REPORT NON-CONSOLIDATED BALANCE

English Translation of a Report Originally Issued in Korean
SHEETS as of March ,  and 
Korean Won (In millions)
To the Shareholders and Board of Directors of LIG Insurance Co., Ltd.: 2008 2007
ASSETS
We have audited the accompanying non-consolidated balance sheets of LIG Insurance Co., Ltd. (the “Company”) as of Cash and bank deposits (Notes 3, 19 and 20) 277,032 219,675
March 31, 2008 and 2007, the related non-consolidated statements of income, appropriations of retained earnings and Securities (Notes 4, 5, 6, 7 and 8) 2,615,636 2,182,562
cash flows for the years then ended, and the related statement of changes in shareholders’ equity for the years ended Loans (Note 9) 2,443,765 1,923,520
March 31, 2008, all expressed in Korean won. These financial statements are the responsibility of the Company’s man- Tangible assets (Note 10) 563,910 563,148
agement. Our responsibility is to express an opinion on these financial statements based on our audits. Other assets (Note 11) 955,868 915,483
Special account assets (Note 30) 450,138 330,624
We conducted our audits in accordance with auditing standards generally accepted in the Republic of Korea. Those Total Assets 7,306,349 6,135,012
standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial state- LIABILITIES AND SHAREHOLDERS’ EQUITY
ments are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts LIABILITIES:
and disclosures in the financial statements. An audit also includes assessing the accounting principles used and signifi- Policy reserves (Notes 15 and 19) 5,401,529 4,655,172
cant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that Catastrophe reserves (Note 15) 360,840 347,897
our audits provide a reasonable basis for our opinion. Borrowings (Note 16) 14,696 -
Other liabilities (Note 17) 513,281 407,485
In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position Special account liabilities (Note 30) 449,645 334,531
of the Company as of March 31, 2008 and 2007, the results of its operations, changes in its retained earnings and its Total liabilities 6,739,991 5,745,085
cash flows for the years then ended, and the changes in its shareholders’ equity for the year ended March 31, 2008, in SHAREHOLDERS’ EQUITY (Note 21)
conformity with accounting principles generally accepted in the Republic of Korea (See Note 2). Capital stock 30,000 30,000
Capital surplus 51,467 51,110
Accounting principles and auditing standards and their application in practice vary among countries. The accompany- Capital adjustments (21,715) (21,340)
ing financial statements are not intended to present the financial position, results of operations, changes in sharehold- Accumulated other comprehensive income 165,228 106,710
ers’ equity and cash flows in accordance with accounting principles and practices generally accepted in countries other Retained earnings 341,378 223,447
than the Republic of Korea. In addition, the procedures and practices utilized in the Republic of Korea to audit such Total Shareholders’ Equity 566,358 389,927
financial statements may differ from those generally accepted and applied in other countries. Accordingly, this report Total Liabilities and Shareholders’ Equity 7,306,349 6,135,012
and the accompanying financial statements are for use by those knowledgeable about Korean accounting procedures
and auditing standards and their application in practice. See accompanying notes to non-consolidated financial statements.

May 21, 2008

Notice to Readers_ This report is effective as of May 21, 2008, the auditors’ report date. Certain subsequent
events or circumstances may have occurred between the auditors’ report date and the time the auditors’ report is read.
Such events or circumstances could significantly affect the accompanying financial statements and may result in modi-
fications to the auditors’ report.

LIG INSURANCE CO., LTD.

FY07 ANNUAL REPORT Leaping Forward from 38_ 39
Good to Great

NON-CONSOLIDATED STATEMENTS OF NON-CONSOLIDATED

INCOME for the years ended March ,  and  STATEMENTS OF APPROPRIATIONS
Korea Won (In millions except per share amounts)
OF RETAINED EARNINGS
for the years ended march ,  and 
2008 2007
OPERATING REVENUES:
Premium income (Note 22) 4,187,358 3,881,973 Korea Won (In millions)

Reinsurance income (Note 24) 244,438 232,256 2008 2007

Interest income 267,469 228,304 RETAINED EARNINGS BEFORE APPROPRIATIONS:
Others (Note 23) 482,475 428,424 Retained earnings carried forward from prior years 3,291 -
5,181,740 4,770,957 Net income 124,695 10,055
OPERATING EXPENSES: 127,986 10,055
Net provision for policy reserve 743,909 708,359 APPROPRIATIONS:
Net provision for catastrophe reserve 12,943 14,014 Dividend (Note 28) 27,057 6,764
Claim expenses 1,416,287 1,418,725 (Cash dividends Dividends per share (rate):
Refund of surrender value 981,186 894,965 500 (100%) at 2008 125 (25%) at 2007)
Reinsurance premium paid 577,878 548,954 Voluntary reserve 95,000 -
Operating and administrative expenses (Note 25) 717,478 722,990 122,057 6,764
Others (Note 26) 577,334 464,051 UNAPPROPRIATED RETAINED EARNINGS TO BE CARRIED
5,027,015 4,772,058 FORWARD TO SUBSEQUENT YEAR 5,929 3,291
OPERATING INCOME (LOSS) 154,725 (1,101)
See accompanying notes to non-consolidated financial statements.
NON-OPERATING INCOME:
Gain on valuation of equity securities using the equity method 3,581 5,191
Gain on disposal of equity securities using the equity method 12,648 -
Gain on disposal of tangible assets 18 5
Commission received from special account 2,288 2,026
Miscellaneous revenues 6,507 11,851
25,042 19,073
NON-OPERATING EXPENSES:
Loss on valuation of equity securities using the equity method 5,477 4,612
Loss on disposal of tangible assets 4,937 972
Donations and contributions 731 676
Miscellaneous expenses 12,998 2,104
24,143 8,364
INCOME BEFORE INCOME TAX 155,624 9,608
INCOME TAX EXPENSE (BENEFITS) (Note 27) 30,929 (448)
NET INCOME 124,695 10,056
BASIC NET INCOME PER SHARE (Note 29) 2,304 186
DILUTED NET INCOME PER SHARE (Note 29) 2,304 186

See accompanying notes to non-consolidated financial statements.

LIG INSURANCE CO., LTD.

FY07 ANNUAL REPORT Leaping Forward from 40_ 41
Good to Great

NON-CONSOLIDATED STATEMENT OF NON-CONSOLIDATED STATEMENTS OF

CHANGES IN SHAREHOLDERS’ EQUITY CASH FLOWS for the years ended March ,  and 
for the years ended March , 
Korea Won (In millions)

2008 2007
Korea Won (In millions)
CASH FLOWS FROM OPERATING ACTIVITIES:
Capital Capital Capital Accumulated Retained Total
Net income 124,695 10,056
stock surplus adjustments other com- earnings
prehensive Adjustment to reconcile net income to net cash provided
income by operating activities:
As of April 1, 2007 30,000 51,110 (21,340) 106,710 223,447 389,927
Increase in policy reserves 743,909 708,359
Dividend - - - - (6,764) (6,764)
Increase in catastrophe reserves 12,943 14,014
Balance after appropriations - - - - 216,683 383,163
and adjustments Provision for severance benefits 26,272 47,018
Depreciation 24,222 30,328
Net income - - - - 124,695 124,695
Provision for loan losses 11,283 804
Gain on disposition of treasury stock - 357 - - - 357
Loss on disposal of available-for-sale securities 268 176
Valuation of treasury stock - - (375) - - (375)
Loss on impairment of available-for-sale securities 11,137 963
Valuation of available-for-sale - - - 62,848 - 62,848
securities Amortization of deferred acquisition costs 236,123 203,823
Loss on disposal of tangible assets 4,937 972
Negative changes in equity arising on - - - 2,068 - 2,068
application of the equity method Amortization of intangible assets 5,934 6,789
Other expenses not involving cash inflows 35,058 23,588
Loss on overseas operation - - - 1,373 - 1,373
translation Gain on disposal of trading securities (7,392) (2,454)
Gain on valuation of trading securities (20,177) (13,816)
Valuation of derivatives as a cash - - - (7,771) - (7,771)
flow hedge Indemnity gains 213 (4,549)
Gain on disposal of available-for-sale securities (18,820) (56,806)
As of March 31, 2008 30,000 51,467 (21,715) 165,228 341,378 566,358
Gain on valuation of derivatives (16) (4,330)
See accompanying notes to non-consolidated financial statements. Gain on trading derivatives (6,253) (10,545)
Gain on disposal of tangible assets (18) (5)
Other revenues not involving cash inflows (35,091) (10,506)
1,024,532 933,823
Changes in assets and liabilities resulting from operations:
Increase in insurance accounts receivable (5,050) (3,654)
Increase in accrued revenues (7,293) (10,870)
Increase in special accounting assets (119,514) (96,131)
Increase in deferred acquisition costs (314,070) (333,143)
Increase (decrease) in deferred income tax liabilities 1,698 (364)
Increase in special accounting liabilities 115,114 96,131
Increase (decrease) in insurance accounts payable 37,293 (8,636)
Others, net (771,617) (488,897)
(1,063,439) (845,564)
Net cash provided by operating activities 85,788 98,315

LIG INSURANCE CO., LTD.

FY07 ANNUAL REPORT Leaping Forward from 42_ 43
Good to Great

2008
Korea Won (In millions)

2007
NOTES TO NON-CONSOLIDATED
CASH FLOWS FROM INVESTING ACTIVITIES: FINANCIAL STATEMENTS
for the years ended March ,  and 
Proceeds from bank deposits 155,332 129,820
Proceeds from sale of equity securities using _the equity method 3,402 113
Proceeds from sale of tangible assets 8,177 11
Proceeds from security deposits 41,526 44,392 1. GENERAL:
Proceeds from guarantee deposits 1,372 2,761 LIG Insurance Co., Ltd. (the “Company”) was incorporated on December 16, 1958 under the laws of the Republic of
Increase in bank deposits (214,359) (168,049) Korea to engage in non-life insurance related business. On April 1, 2006, the Company changed its name to LIG
Acquisition of equity securities using the equity method (2,570) (7,326) Insurance Co., Ltd. In July 1976, the Company listed its shares of common stock on the Korea Stock Exchange, and its
Acquisition of tangible assets (38,079) (23,771) total common stock amounts to 30,000 million as of March 31, 2008.
Acquisition of intangible assets (3,652) (12,703)
Increase in security deposits (43,819) (38,304) The Company’s shareholders as of March 31, 2008 are as follows:
Increase in guarantee deposits (2,382) (1,882)
Shareholders Number of shares Ownership ratio
Net cash used in investing activities (95,052) (74,938)
Koo, Bon Sang and 18 other related individuals 15,458,696 25.76%
CASH FLOW FROM FINACING ACTIVITIES:
Treasury stock 5,885,050 9.81%
Proceeds from borrowings 14,696 8,500
Other 38,656,254 64.43%
Increase in leasehold deposits 2,843 11,381
60,000,000 100.00%
Payment of borrowings - (8,500)
Decrease in leasehold deposits (3,180) (12,498)
Payment of stock dividend (6,764) (13,528)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
Net cash used in financing activities 7,595 (14,645)
Basis of Financial Statement Presentation
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (1,669) 8,732
The Company maintains its official accounting records in Korean won and prepares statutory non-consolidated finan-
CASH AND CASH EQUIVALENTS, BEGINNING OF THE YEAR 67,834 59,102
cial statements in the Korean language (Hangul) in conformity with the accounting principles generally accepted in
CASH AND CASH EQUIVALENTS, END OF THE YEAR (Note 37) 66,165 67,834
the Republic of Korea. Certain accounting principles applied by the Company that conform with financial accounting
See accompanying notes to non-consolidated financial statements. standards and accounting principles in the Republic of Korea may not conform with accounting principles generally
accepted in other countries. Accordingly, these financial statements are intended for use by those who are informed
about Korean accounting principles and practices. The accompanying financial statements have been condensed,
restructured and translated into English with certain expanded descriptions from the Korean language financial state-
ments. Certain information included in the Korean language financial statements, but not required for a fair presenta-
tion of the Company’s financial position, results of operations, changes in shareholders’ equity or cash flows, is not
presented in the accompanying financial statements.

The significant accounting policies followed by the Company in preparing the accompanying non-consolidated finan-
cial statements are summarized below.

Financial statements to be presented at the annual shareholders’ meeting were approved by the board of directors on
May 21, 2008.

LIG INSURANCE CO., LTD.

FY07 ANNUAL REPORT Leaping Forward from 44_ 45
Good to Great

Adoption of the Statements of Korea Accounting Standards exceed their fair value plus incidental expenses at the time of acquisition. Valuation methods of securities are summa-
(1) Adoption the Newly Issued Statements of Korea Accounting Standards rized as follows:
The Korea Accounting Standard Board (KASB) under the Korea Accounting Institute (KAI) has issued the Statements
of Korea Accounting Standards (SKAS No.1 to No. 25) for achieving a set of Korean accounting standards. The
Category Valuation method Recognition of valuation gain/loss
Statements supersede the related articles of existing accounting standards and constitute generally accepted accounting
Trading securities Fair value based method Valuation gain/loss is reflected in
principles of the Republic of Korea. The Company implemented SKAS No.1 to SKAS No.20 before FY2007 and has current operation.
adopted SKAS No.11, SKAS No21 and No.25 since April 1, 2007. The newly adopted SKAS has no effect on to net
Available-for sale securities Fair value based method Valuation gain/loss is accounted for as
assets and net income as of and for the years ended March 31, 2008 and 2007. Certain accounts in the 2007 financial accumulated other comprehensive
income (loss)
statements, which are presented for comparative purposes, were reclassified according to SKAS No.21 and SKAS
No.24.
Impairment loss is reflected in current
operation.
(2) Adoption the Revised Statements of Korea Accounting Standards and Others Non-marketable equity securities are
The Korea Accounting Standard Board (KASB) has revised the (SKAS No.5, 9, 15, 16, 19, 20 and 24) and stated at acquisition cost if the fair value
of the securities is not credibly
Interpretations No.53-70. The Company has early adopted the revised SKAS, but such adoption has are no effects on determinable
net income and net assets for the years ended and as of March 31, 2008 and 2007. Held-to maturity securities Acquisition cost based method after Impairment loss is reflected in current
amortization operation.

Cash and Bank Deposits

Cash and bank deposits are securities and short-term money market instruments, which can be easily converted into
cash and whose risk of value fluctuation arising from changes of interest rate is not material. Only marketable securi- If the objective and ability to held securities of the Company change, available-for-sale securities can be reclassified to

ties and short-term financial instruments with maturities or date of redemption of three months or less are regarded as held-to-maturity securities and held-to-maturity securities can be reclassified to available-for-sale securities. Whereas,

cash and bank deposits. if the Company sells held-to-maturity securities or exercises early redemption right of securities to issuer in the current
year or the proceeding two years, and if it reclassifies held-to-maturity securities to available-for-sale securities, all debt
securities that are owned or purchased cannot be classified as held-to-maturity securities. On the other hand, trading
Specified Money Trust
securities cannot be reclassified to available-for-sale securities or held-to-maturity securities and vice versa.
When the beneficiary certificates issued by a trust company are possessed to obtain gains from short-term price fluctu-
Nevertheless, trading securities can be reclassified to available-for-sale securities only when the trading securities loss
ation, these are recorded as trading securities. Otherwise, the beneficiary certificates are recorded as available-for-sale
its marketability.
securities. If the money trusts conform to the specified money trust, the Company evaluates specified money trust by
the same method applied to directly owned assets.
When the amount estimated to be recoverable (hereinafter referred to as the “recoverable amount”) is less than the
acquisition cost after amortization of a debt security or the acquisition cost of an equity security, recognition of
Securities
impairment loss is considered. Securities are evaluated at each balance sheet date to determine whether there is any
At acquisition, the Company classifies securities into one of the following categories: trading, available-for-sale, held-
objective evidence of impairment loss. When any such evidence exists, unless there is a clear counter-evidence that
to-maturity and securities using the equity method, depending on marketability, purpose of acquisition and ability to
recognition of impairment is unnecessary, the difference between the recoverable amount and the acquisition cost
hold. Debt and equity securities that are bought and held for the purpose of selling them in the near term and actively
after amortization of a debt security or the acquisition cost of an equity security is recorded as impairment loss on
traded on the stock exchange or over-the-counter are classified as trading securities. Debt securities with fixed and
available-for-sale securities or held-to maturity securities. The reversal of impairment loss of available-for sale or a
determinable payments and fixed maturity that the Company has the positive intent and ability to hold to maturity are
held-to-maturity security, when it is objectively related to an event occurring after the recognition of impairment loss,
classified as held-to-maturity securities. Equity securities that are valuated using the equity method are classified as
is recognized as current income up to the acquisition cost after amortization assuming impairment loss was not recog-
securities using the equity method. Debt and equity securities not classified as the above are categorized as available-
nized. In addition, the increased amount over impairment loss previously recognized is treated as gain on valuation of
for-sale securities.
available-for sale securities and accounted for as accumulated other comprehensive income. However, the equity secu-
rity that was valued at acquisition cost and was impaired by fair value method cannot be reversed over the acquisition
Securities are initially recognized at acquisition cost plus incidental expenses determined by the individual moving
cost.
average method (the specific identification method for debt securities). Such acquisition cost of securities cannot

LIG INSURANCE CO., LTD.

FY07 ANNUAL REPORT
Equity Securities Valuated Using the Equity Method
Equity securities that the Company has significant influence are valuated using the equity method.
(1) Accounting for Changes in the Company’s Share of Equity in Interest
Changes in the Company’s share of equity interest in an associate are adjusted to the balance of investment in the asso-
ciate and accounted for in accordance with the source of changes in the net assets of the associate.
If changes in the net assets of an associate arise as a result of net income or net loss for the current period, changes in
the Company’s share of equity interest in the associate are accounted for as non-operating income(expenses), as gain
or loss on application of the equity method. If changes in the net assets of an associate arise as a result of unappropriat-
ed retained earnings for the current period, changes in the Company’s share of equity interest in the associate are
accounted for as of unappropriated retained earnings, as changes in retained earnings arising on application of the
equity method. If changes in the net assets of an associate arise as a result of an increase or decrease in equity, exclud-
ing the associate’s net income or net loss for the current period and changes in the associate’s beginning balance of
retained earnings, the resulting change in the Company’s share of equity interest in the associate is included in the
Company’s accumulated other comprehensive income (loss), as changes in equity arising on application of the equity
method. If an associate’s beginning balance of retained earnings has been changed because of a material error correc-
tion and if the effect of such change on the financial statements of the Company is immaterial, the resulting change in
the Company’s share of equity interest in the associate is accounted for as non-operating income (expenses), as gain or
loss on application of the equity method. If an associate’s beginning balance of retained earnings has been changed
because of the associate’s accounting changes, the resulting change in the Company’s share of equity interest in the
associate is reflected in the Company’s beginning balance of retained earnings in accordance with Korea Accounting
Standards for accounting changes and corrections of errors.
At the date of an associate’s dividend declaration, the Company subtracts the amount of dividend receivable directly
from the carrying amount of the investment in the associate.
(2) Accounting for Investment Difference
Investment difference is the amount of difference between the cost of acquisition and the investor’s share of the fair
values of the net identifiable assets of the associate. Such difference is treated as goodwill and accounted for in accor-
dance with Korea Accounting Standards on business combinations. Goodwill shown as part of the carrying amount of
the investment in the associate is amortized within 5 years at straight-line method and negative goodwill is reversed to
adjust the carrying amount of equity security within the weighted average years of associate’s amortizable asset in non-
monetary assets.
Moreover, the Company calculates the investment difference or gain (loss) on disposition if its share of equity interest
in an associate increases (decreases) in contributed capital with (or without) consideration.
When changes in the Company’s share of equity interest in a subsidiary occur as a result of changes in contributed cap-
ital of the subsidiary, such as increase in contributed capital with consideration, the difference between (1) the amount
obtained by deducting the Company’s share of equity interest in the subsidiary before the change in contributed capi-
tal from the Company’s share after such change and (2) the acquisition cost of securities newly acquired through the
change in contributed capital are included in accumulated other comprehensive income.
Leaping Forward from 46_ 47
Good to Great
(3) Accounting for the Difference between the Fair Value and Book Value of the Net Assets of the
Associate
At the date of acquisition of an investment in an associate, among the difference between the fair value and book value
of the identifiable assets and liabilities of an associate, the amount relating to the Company’s share of equity interest in
the associate is amortized or reinstated in accordance with the associate’s methods of accounting for assets and liabili-
ties.
(4) Elimination of Unrealized Intercompany Gains or Losses
Among the amount calculated by multiplying the Company’s share of an associate’s equity to the total amount of gains
or losses arising on transactions between the Company and the associate, the portion of the calculated amount that
continues to be reflected in the carrying amount of the Company’s investment held as of the balance sheet date is
referred to as unrealized intercompany gain or loss. Unrealized gains are accounted for as a reduction of the carrying
amount of the investment in the associate, while unrealized losses are added to the carrying amount of the investment
in the associate.
If the associate is subsidiary, the entire portion of gains or losses arising on sales of assets from the Company to an
associate (commonly referred to as upstream sales transactions) that is included in the carrying amount of assets held
as of the balance sheet date is eliminated.
(5) Impairment Losses
If there is objective evidence that impairment loss has been incurred and the amount recoverable from an investment
in an associate is less than its carrying amount, the Company considers recognition of an impairment loss.
If the amount recoverable from an investment in an associate (hereinafter referred to as the recoverable amount) is less
than its carrying amount, the investor considers recognition of an impairment loss. Pursuant to Korea Accounting
Standards for investments in securities, the investor determines whether there is objective evidence that impairment
loss has been incurred, and when such evidence exists, impairment loss is recognized in accordance with Korea
Accounting Standards for impairment losses. If there is any amount of unamortized investment difference when the
Company recognizes impairment loss on an investment in an associate, the remaining balance of the investment dif-
ference is reduced first.
If the recoverable amount of an investment in an associate increases after recognizing an impairment loss, the amount
of increase is recognized as current income to the extent of the impairment loss previously recognized. In such a case,
the carrying amount of the investment shall not exceed the carrying amount that would have been determined, as of
the date of the recovery, if no impairment loss were recognized in prior periods. However, since recovery of impair-
ment loss recognized by reducing the balance of unamortized investment difference is not permitted, no accounting
treatment shall be made for such recovery.
(6) Translation of Financial Statements of Associates Operating Overseas
After translating the financial statements of an associate operating overseas in accordance with Statement of Korea
LIG INSURANCE CO., LTD.
FY07 ANNUAL REPORT
Accounting Standards on Consolidated Financial Statements, the Company applies the equity method. After translat-
ing into Korean won (KRW), the difference between the total equity and the amount obtained by deducting liabilities
from assets, the amount relating to the investor’s share of the associate’s equity interest is accounted for as accumulat-
ed other comprehensive income (loss).
Deferred Incident Income and Expenses from Loans
Incident income from loans (except for interest income) is deferred and is subtracted from loans. The deferred inci-
dent income from loans is amortized using the effective interest method over the loan period and is recognized as
interest income. If incident expenses of loans bring on future economic benefit, such expenses are deferred and added
to loans. The deferred incident expense from loans is amortized using the effective interest method over the loan peri-
od and is subtracted from interest income. In addition, net of deferred income from loans and deferred expense from
loans is reported in the balance sheet.
Allowance for Possible Losses on Credits
In accordance with the Regulation on Supervision of Insurance Business (the “Supervisory Regulation”) legislated by
the Korean Financial Supervisory Service (FSS) and the Company’s analysis of its assets and estimated loss on uncol-
lectible accounts computed using past collection experience, the Company classifies all credits into five categories as
normal, precautionary, substandard, doubtful, or estimated loss based on borrowers’ repayment capability and histori-
cal financial transaction records. The Supervisory Regulation also requires the Company to provide the minimum rate
of loss provision for each category balance using the prescribed minimum percentages of 0.5 percent (household loan
is 0.75 percent) or more, 2 percent (household loan is 5 percent) or more, 20 percent or more, 50 percent or more and
100 percent, respectively. The Company compares the allowance for possible losses on credits calculated using the
minimum rate of loss provision for each category balance with the allowance for possible losses on credits calculated
through objective and reasonable method, such as the historical loss rate, and then, the larger amount is accounted for
as the allowance for possible losses on credits. In addition, the Company uses roll-rate method with one year historical
loss rate.
Valuation of Receivables and Payables at Present Value
Receivables and payables incurred through long-term installment transactions, long-term borrowing and lending
transactions and other similar transactions are stated at the present value of expected future cash flows with gain or
loss on valuation of the related receivables and payables reflected in current operations, unless the difference between
nominal value and present value is immaterial. The present value discount or premium is amortized using the effec-
tive interest rate method with the amortization recorded as interest income or interest expense.
Restructuring of Loans
In case the contractual terms, such as the principal amount, interest rate or maturity, have been modified to alleviate
the debtor’s burdens, the Company recognizes the difference between the carrying amount of the receivable and the
adjusted amount of the receivable as bad debt expense or gain on debt restructuring. There is no bad debt expense or
gain on debt restructuring recognized by the Company for the years ended March 31, 2008 and 2007.
Leaping Forward from 48_ 49
Good to Great
Valuation of Tangible Assets
Tangible assets are stated at manufacturing cost or acquisition cost plus incidental cost, except for certain assets reval-
ued upward in accordance with the Asset Revaluation Law of Korea. Routine maintenance and repairs are expensed as
incurred. Expenditures that result in the enhancement of the value or the extension of the useful lives of the facilities
involved are capitalized as additions to tangible assets. In addition, interest expenses of borrowings used for manufac-
turing, acquisition, construction and development of tangible assets are accounted for as period expense.
When the book value of assets (other than trading securities, investment securities and assets valued at present value)
exceeds the recoverable value of the assets due to obsolescence, physical damage or a sharp decrease in market value
and the difference is material, those assets are adjusted to recoverable value in the balance sheet and the resulting
impairment loss is charged to current operations. If the recoverable value of the assets increases in subsequent years,
the increase in value is credited to operations as gain until the recoverable value equals the presumed book value of the
assets assuming the impairment loss has not been recognized. The Company did not recognize any impairment loss or
reversal of impairment loss for the years ended March 31, 2008 and 2007.
Depreciation is computed using the declining balance method for tangible assets (straight-line method for buildings
acquired after January 1, 1995), based on the estimated useful lives of the assets as described below.
Estimated useful lives-years
Building 20~55
Vehicles 4
Equipment 4~10
A tangible asset that is removed from active use and held for disposal or retirement is carried at its carrying amount at
the date when the asset is removed from active use. Such asset is not depreciated and instead, is reclassified as an
investment and tested for impairment at each fiscal year-end. The Company has no tangible assets reclassified as an
investment as of March 31, 2008 and 2007. On the other hand, an asset retired from active use and held for future use
is depreciated and the depreciation expense is recorded as a non-operating expense. The Company did not recognize
any costs in relation to retired asset as expense for the years ended March 31, 2008 and 2007.
Valuation of Intangible Assets
Intangible assets are stated at manufacturing cost or acquisition cost plus incidental cost and amortized over 5 years
from the assets are useable, using the straight-line method. For the year ended March 31, 2007, the Company has
write-off unamortized balance of 1,581 million in relation to software (MS EA Contract) and has recognized acquisi-
tion costs of 279 million in relation to software as expenses, in accordance with the new interpretation from the FSS.
The Company did not recognize any costs in relation to software as expense for the year ended March 31, 2008.
If the carrying amount of an intangible asset materially exceeds its recoverable amount as a result of obsolescence or
sharp decline in market value of the asset or because of some other causes of impairment, the carrying amount of the
LIG INSURANCE CO., LTD.
FY07 ANNUAL REPORT
asset shall be reduced to its recoverable amount and the amount of difference shall be recognized as an impairment
loss. However, if the recoverable amount of an intangible asset, for which impairment loss was recognized in prior
periods, exceeds its carrying amount in subsequent periods, the amount of impairment loss recognized is reversed to
the extent of the increased carrying amount of the intangible asset but shall not exceed the carrying amount that would
have been determined, net of amortization, if no impairment loss were recognized in prior periods. The Company did
not recognize any impairment loss or recovery of impairment loss for the years ended March 31, 2008 and 2007.
Deferred Acquisition Costs
In accordance with Article 31 of the Accounting Standards for Insurance Industry and supplementary provision 3,
acquisition costs arising from long-duration contracts are deferred and evenly amortized over the term of premium
payment. However, the amount exceeding the expected acquisition cost, and the acquisition costs in case where the
ratio of loading charge is disproportionately distributed toward the initial insurance period for successful collection of
the acquisition costs in an early stage, is recognized as expenses incurred in the current accounting year. When the
term of premium is more than seven years, the acquisition cost is deferred and evenly amortized over seven years. In
case of cancellation, unamortized balance is entirely amortized during the fiscal year it was cancelled (on the day lapsed
day in case the insurance contract has lapsed).
Accounting for Foreign Currency Transactions and Translation
The Company maintains its accounts in Korean won. Transactions in foreign currencies are recorded in Korean won
based on the prevailing rates of exchange on the transaction date. Monetary assets and liabilities with balances denom-
inated in foreign currencies are recorded and reported in the accompanying financial statements at the exchange rates
prevailing at the balance sheet dates. The balances have been translated using the Basic Rate announced by Seoul
Money Brokerage Service, Ltd., which was 991.70 and 940.30 to US$ 1.00 at March 31, 2008 and 2007, respectively.
The gain or loss on translation is credited or charged to current operations.
Accounting for Translating the Financial Statements of the Overseas Branch
When translating the financial statements of the overseas branch, the Company applies the foreign exchange rate at
balance sheet date for assets and liabilities, the foreign exchange rate at transaction date for equity and the average for-
eign exchange rate for the period for profit and loss accounts. The amount relating to the difference in the translation
is accounted for as accumulated other comprehensive income (loss) as overseas operation translation profit (loss). Net
overseas operation translation profit (loss) is accounted for as profit or loss during the period the overseas branch shall
be liquidated or sold.
Insurance Reserve
(1) Policy Reserve
In accordance with the Regulation on Supervision of Insurance Business, the Company is required to maintain policy
reserve for insurance claims and policyholders’ dividends.
Reserve for outstanding claims
The reserve for outstanding claims is based on the accumulation of estimated losses reported (estimated losses for
Leaping Forward from 50_ 51
Good to Great
claims, cash surrender values or policyholders’ dividends, which are in dispute or in litigation, and estimated losses for
claims fixed but not settled) and IBNR (incurred but not reported) prior to the balance sheet date incurred from the
direct business written by the Company and estimated losses received from ceding companies.
Long-term insurance premium reserve
The Company maintains reserve for the portions of premiums (and investment income on such portions), which are
refundable to policyholders upon maturity and amounts refundable for policy cancellations under long-term deposit-
type insurance.
Unearned premium reserve
The Company is required to maintain an unearned premium reserve at amounts determined based on lines of insur-
ance and types of policies.
Reserve for participating policyholders’ dividends
The Company is required to maintain a reserve for participating policyholders’ dividends under regulations approved
by the Ministry of Financial and Economy( MOFE ).
Excess participating policyholder dividend reserve
Pursuant to relevant laws and contracts, the Company may provide an excess participating policyholder dividend
reserve in accordance with the operating results of related insurance products. The reserve may be used to pay partic-
ipating policyholder dividends or additional dividends.
If the Company reinsures its insurance contracts, the recoverable amount from reinsurance company is accounted for
as a deductible account against policy reserve.
(2) Catastrophe Reserve
The Company is required to maintain a catastrophe reserve based certain ratio (fire - 5%, marine - 3%, automobile -
2%, surety - 6%, casualty - 5%, assumed and overseas direct insurance - 3%) and the ratio (35%~100%) of earned
premium for general and automobile insurance with the limit of 50% (automobile - 40%) of insurance premium for
the year before FY closing day. In addition, reversal of provision for catastrophe reserve is recorded in operating
income up to excess of certain amounts (fire - 120%, marine automobile casualty - 110%, surety - 140%, assumed and
overseas direct insurance - 80%) within the limit of the net losses before the reversal for the year.
Premium Deficiency
The Accounting Standards for insurance industry requires the Company to additionally amortize policy acquisition
cost to the extent required to eliminate the premium deficiency. This deficiency is incurred in case when the estimated
investment yield applied to premium reserve is higher than that of 1 year time deposit as of the balance sheet date and
when this situation is expected to be continued for the long run. A deficiency would be incurred if the amount of pre-
mium reserve as of the balance sheet date does not exceed present value of liability for future policy benefits less pre-
sent value of future net premium reserve. If this deficiency exceeds the portion of policy acquisition cost to be addi-
LIG INSURANCE CO., LTD.
FY07 ANNUAL REPORT Leaping Forward from 52_ 53
Good to Great

tionally amortized, dividend reserve for policyholders’ income participation or reserve for policyholders’ dividend sta- Valuation of Derivatives
bilization is replaced to premium reserve. If dividend reserve for policyholder’s income participation or reserve for pol- The Company records the fair value of rights or obligations associated with derivative financial instruments as assets
icyholders’ dividend stabilization is unavailable or insufficient, additional premium reserve is required to replenish the and liabilities, and the valuation gain or loss is reflected in current operations. The effective portion of gain or loss on a
shortage. As of March 31, 2008, the Company has no balance for premium deficiency. derivative instrument designated as a cash flow hedge is recorded as accumulated other comprehensive income (loss).

Compensation Receivables Dormant Claims

Of the amounts paid for claims during the year, amounts recoverable by exercising compensation and other rights or In accordance with voluntary improvement plan of dormant insurance claims issued by FSC on March 31, 2005, the
through disposal of secured assets acquired in the resolution of accidents are accounted for as compensation receiv- Company records estimated reserve, which is calculated using the historical rate of claims with lapsed insurance con-
ables and deducted directly from insurance reserves in the accompanying balance sheet. Compensation receivables are tract as liabilities in case the Company is substantially obligated to pay claims due to the fairness and the general prac-
calculated by multiplying the average recovery ratio (recovery amount/net claims) for prior 3 years from the prior year tice of insurance business against the lapsed insurance contract. In relation with the dormant claims, the Company
balance sheet date to the amount of net claims for prior 1 year from the prior year balance sheet date. In addition, a recorded 12,288 million and 8,789 million as liabilities for the years ended March 31, 2008 and 2007, respectively.
recoverable gain calculated by multiplying above average recovery ratio to reserve for outstanding claims as of March
31, 2008 is subtracted from reserve for outstanding claims. Special Accounting Assets (Liabilities)
In accordance with Article 108 of the Insurance Business Act and the Regulation on Supervision of Insurance Business,
Accrued Severance Benefits the Company is required to maintain special accounts on the balance sheet for the assets and liabilities related to cor-
Employees and directors with more than one year of service are entitled to receive a lump-sum payment upon termina- porate pension policies from the other insurance policies. Assets and liabilities separately administered from the gen-
tion of their service with the Company, based on their length of service and rate of pay at the time of termination. The eral account in the asset management and income distribution are deemed assets and liabilities in segmented report-
accrued severance benefits that would be payable assuming all eligible employees and directors were to resign amount ing. These accounts are presented together as special accounting assets (liabilities) in the balance sheet. In the case of
to 134,671 million and 123,679 million as of March 31, 2008 and 2007, respectively. operating loss from special accounts, the Company appropriates deficiency by charging first on dividend reserve for
The Company has purchased severance benefits insurance and has deposits of 106,740 million and 71,943 million policyholders’ income participation reserved in special account and any remaining balance of loss is charged to share-
with LIG Life Insurance Co., Ltd. (formerly, Lucky Life Insurance Co., Ltd.) and others as of March 31, 2008 and 2007, holders’ equity.
respectively. These deposits are presented as a deduction from the accrued severance benefits. In addition, accrued sev- In addition, Article 4-1 of the Regulation on Supervision Insurance Business requires special accounts receivable
erance benefits are funded through an individual severance insurance plan. Retirement pension deposits pursuant to (payable) to b presented as a deduction from the special accounting liabilities (assets). As a result, the additional
former National Pension Law are accounted for as individual severance insurance deposits, with a balance of 1,971 decrease in total assets (liabilities) for the years ended March 31, 2008 and 2007 amounts to 14,086 million and
million and 2,222 million as of March 31, 2008 and 2007, respectively, which are presented as deduction from 3,907 million, respectively, but there is no effect on net income and net assets for the years ended March 31, 2008
accrued severance benefits. and 2007.
Actual payment of severance benefits amounted to 15,279 million and 48,421 million for the years ended March 31, In addition, Article 6-23 of the Regulation on Supervision Insurance Business required companies to maintain special
2008 and 2007, respectively. accounts of revenue and expense on the income statements for the premium guarantee special accounts of revenue
and expense as of March 31, 2007. As a result, the additional increase in operation revenue and expense for the years
The details of change in accrued severance benefits are as follows (Unit: Won in millions): ended March 31, 2008 and 2007 amounts to 232,404 million and 178,683 million, respectively, but there is no effects
on net income and net assets for the years ended March 31, 2008 and 2007.
2008 2007
Beginning balance 49,514 54,979
Revenue Recognition
Transferred-in 26,271 47,018
Revenues from premium income are recognized at the time when such premium payments become due. However, in
Payment of severance benefits (15,279) (48,421)
the case of insurance contracts of which the first premium payment or lump-sum premium payment are uncollected
Deposit of severance benefits (34,798) (4,668)
as of the first day of the insured period due to a payment extension allowed by the Company, the first premium pay-
Individual severance insurance deposits 251 606
ment or lump-sum premium payment may be recognized as revenue in the period in which the first day of insured
Ending balance 25,959 49,514
period falls.
The Company applies the accrual basis in recognizing interest income related to deposits, loans and securities, except
for non-secured uncollectible receivables. Interest on loans and collapsible corporation’s securities, whose principal or
interest is past due at the balance sheet date, is generally not accrued. When a loan is placed on non-accrual status,

LIG INSURANCE CO., LTD.

FY07 ANNUAL REPORT Leaping Forward from 54_ 55
Good to Great

previously accrued interest is generally reversed and deducted from the current interest income, and future interest *1_ It is the difference between the book value before valuation and the fair value, and includes gain (loss) on valuation of trading
income is recognized on cash basis in accordance with the accounting standard. securities, gain (loss) on translation of foreign currencies and overseas operations translation credit.
*2_ Other securities are Derivatives Linked Securities (DLS)

Income Tax Expense Among trading securities, the fair value of equity securities is the closing price at the balance sheet date, the fair value of
The difference between the amount currently payable for the period and income tax expense is accounted for as beneficiary certificates is the trading base price provided by fund management companies, the fair value of debt securi-
deferred income tax assets or liabilities, which will be charged or credited to income tax expense in the period each ties (including debt securities denominated in foreign currencies) is calculated by the arithmetic average of recent mar-
temporary difference reverses in the future. Income tax expense is the amount currently payable for the period, addi- ket price provided by NICE Pricing Services Inc. and KIS Pricing Inc, and the fair value of debt securities denominated
tional income tax or tax refunds for prior years added to or deducted from the changes in deferred income taxes. in foreign currencies possessed by overseas branches is calculated using the recent market price announced by a price
Deferred income tax assets or liabilities relating to shareholders' equity or consolidation are charged or credited direct- providing institution.
ly to related components of shareholders' equity or goodwill.
(2) The details of gains and losses on trading securities as of March 31, 2008 and 2007 are as follows (Unit:
3. CASH AND BANK DEPOSITS: Won in millions):
Restricted bank deposits as of March 31, 2008 and 2007 are as follows (Unit: Won in millions): 2008
Disposal Valuation Translation Interest Gain on Overseas Translation Total
Interest rate (%) 2008 2007
Gains 7,392 20,177 2,476 2,947 - 32,992
Deposits for maintenance of checking accounts - 34 34
Losses 12 3,323 - - - 3,335
Security deposits (Seoul Central District Court) 2.00 236 236
Others - - - - 10 10
Trading cash of LIG Insurance (Woori Bank) 3.80 5,800 -
2007
6,070 296
Disposal Valuation Translation Interest Gain on Overseas Translation Total
Gains 2,454 13,816 - 1,630 - 17,900
4. SECURITIES: Losses 517 2,091 1,184 - - 3,792
Securities as of March 31, 2008 and 2007 are as follows (Unit: Won in millions):
Others - - - - (3) (3)

2008 2007
Trading securities (Notes 5 and 19) 228,081 157,959 (3) Privately placed funds
Available-for-sale securities (Notes 6 and 19) 2,160,908 1,760,613 The Company records the privately placed funds as beneficiary certificates (trading securities). As a result, the operat-
Held-to-maturity securities (Note 7) 151,533 214,265 ing returns of privately placed funds are 921 million and 2,051 million for the years ended March 31, 2008 and
Equity securities using the equity method (Note 8) 75,114 49,725 2007, respectively.
2,615,636 2,182,562

The details of privately placed funds as of March 31, 2008 are as follows (Unit: Won in millions):
5. TRADING SECURITIES:
(1) Trading securities as of March 31, 2008 and 2007 are as follows (Unit: Won in millions): 2008
Account Name of fund Category Amount
2008 2007 Deutsche Privately Placed Mixed Government and 320
Beneficiary certificates
BV before Fair value Valuation BV before Fair value Valuation Investment Trust 2nd public bonds
valuation (BV) G(L)*1 valuation (BV) G(L)*1
Special purpose bonds 13,431
Equity securities 13,119 10,201 (2,918) 34,869 36,064 1,195 Corporate bonds 11,642
Government and public bonds - - - 9.864 9,951 87 Deposit 452
Beneficiary certificates 99,557 101,284 1,727 60.639 62,727 2,088 Others 76
Securities denominated in foreign currencies 46,065 66,281 20,216 42,049 49,217 7,168 Total 25,921
Other securities *2 50.000 50,315 315 - - -
208,741 228,081 19,340 147,421 157,959 10,538

LIG INSURANCE CO., LTD.

FY07 ANNUAL REPORT Leaping Forward from 56_ 57
Good to Great

The details of privately placed funds as of March 31, 2007 are as follows (Unit: Won in millions): (2) Equity securities in available-for-sale securities as of March 31, 2008 and 2007 are as follows (Unit:
Won in millions):
2007 2008
Account Name of fund Category Amount Ownership Acquisition Net book value Book value
Beneficiary certificates Deutsche Privately Placed Mixed Government and public bonds 2,193 ratio (%) cost or fair value
Investment Trust 2nd
Special purpose bonds 12,068 Marketable equity securities:
Corporate bonds 36,870 Samsung Fire & Marine Insurance Co., Ltd. 0.83 28,914 80,228 80,228
Deposit 834 Hyundai Fire & Marine Insurance Co., Ltd. 4.93 22,756 92,169 92,169
Others 38 LG Corporation Co., Ltd. 0.61 11,963 79,032 79,032
Total 52,003 Shinhan Financial Group 0.13 30,030 27,145 27,145
Heungkuk Best All Placed Mix Deposit 514 LG Chemical Co., Ltd.*1 0.39 5,087 20,720 20,720
Investment
CD 4,533 GS Holdings *2 0.38 3,393 13,492 13,492
Call loans 2 Realty Korea I 9.09 6,000 6,108 6,108
Total 5,049 LG Household Healthcare Co., Ltd.*1 0.55 1,562 14,663 14,663
Alpha Asset Privately Placed Financial bonds 71 LG Life Sciences Co., Ltd.*1 0.84 1,882 7,308 7,308
Mixed Financial Bonds
Deposit 415 LG Fashion Corp. 0.93 1,734 6,868 6,868
Call loans 14 LG International Corp. 0.91 2,260 6,992 6,992
Total 500 Kumho Tires Co., Inc 0.64 4,500 4,725 4,725
Macquarie Central Office 3.93 3,000 5,298 5,298
Ssangyong Motor Company *3 0.44 5,867 2,896 2,896
6. AVAILABLE-FOR-SALE SECURITIES:
Hyundai Heavy Industries 0.01 2,170 2,223 2,223
(1) Available securities as of March 31, 2008 and 2007 are as follows (Unit: Won in millions):
Hankook Tire 0.09 2,576 2,164 2,164
Kookmin Bank 0.02 2,953 1,939 1,939
2008 2007
Posco 0.00 1,774 1,904 1,904
Equity securities:
Samsung Electronics 0.00 1,716 1,869 1,869
Marketable equity securities 384,096 259,650
Korea Line Corporation 0.09 2,087 1,860 1,860
Unlisted equity securities 42,159 8,993
Kangwon Land 0.03 1,511 1,236 1,236
Investments in partnerships 20,573 3,567
Korean Air 0.03 1,602 1,176 1,176
Sub-total 446,828 272,210
Hite Co., Ltd. 0.03 820 702 702
Debt securities:
Hynix Semiconductor Inc. 0.01 1,001 883 883
Government and public bonds 494,395 243,991
Others *4 65 496 496
Special purpose bonds 578,411 586,271
Sub-total 147,223 384,096 384,096
Corporate bonds 140,811 164,108
Unlisted equity securities:
Debt securities denominated in foreign currencies 222,296 317,883
Shinhan Infra Portfolio Fund. 10.42 18,738 18,738 18,738
Sub-total 1,435,913 1,312,253
Ripo Incheon Development Co., Ltd. 4.05 2,909 2,909 2,909
Others:
Suwon Station Development Co., Ltd.*5 2.73 1,500 2,292 2,292
Beneficiary certificates 159,934 97,512
Korea BTL l Fund. 4.17 4,375 4,375 4,375
Securities denominated in foreign currencies 43,313 31,839
Kyongju SMC Co., Ltd. 10.00 1,063 1,063 1,063
Other securities 74,920 46,799
Chung Lam School Co., Ltd. 10.00 877 877 877
Sub-total 278,167 176,150
Kyeong Gi School Co., Ltd. 15.00 853 853 853
Total 2,160,908 1,760,613

LIG INSURANCE CO., LTD.

FY07 ANNUAL REPORT Leaping Forward from 58_ 59
Good to Great

2008 2007
Ownership Acquisition Net book value Book value Ownership Acquisition Net book value Book value
ratio (%) cost or fair value ratio (%) cost or fair value

Neulpureun Campus Co., Ltd. 15.00 674 674 674 Marketable equity securities:
Neulpureun Yongin Baeoomteo Co., Ltd. 15.00 602 602 602 Samsung Fire & Marine Insurance Co., Ltd. 0.80 28,914 61,790 61,790
Kyeong Gi School Co., Ltd. 15.00 553 553 553 Hyundai Fire & Marine Insurance Co., Ltd. 4.93 22,756 57,330 57,330
Youngduk Enviro Co., Ltd. 12.50 516 516 516 LG Corporation Co., Ltd. 0.61 11,963 33,697 33,697
Pureun Baeoomteo Co., Ltd. 15.00 491 491 491 LG Chemical Co., Ltd. *1 0.47 5,541 14,442 14,442
Chung Lam School Co., Ltd. 14.99 488 488 488 GS Holdings *2 0.38 3,393 12,915 12,915
Seoul Metro Line9 Co., Ltd. 2.99 5,000 5,000 5,000 Realty Korea I 9.09 6,000 10,524 10,524
Blue Holdings Co., Ltd. 5.00 250 250 250 LG Household Healthcare Co., Ltd.*1 0.56 1,581 10,092 10,092
Korea Securities Depository *5 0.01 4 61 61 Kocref Cr-reit I 7.52 10,000 9,690 9,690
Others 3,745 2,417 2,417 Kumho Tires Co., Inc 1.06 7,390 8,868 8,868
Sub-total 42,638 42,159 42,159 LG International Corp. 0.53 2,298 7,703 7,703
Investments in partnerships: LG Fashion Corp. 0.93 1,734 6,190 6,190
Macquarie PEF 0.82 6,255 6,255 6,255 LG Card Corp. 0.11 5,500 6,156 6,156
LG Jupiter Fund 11th 13.33 4,000 4,000 4,000 LG Life Sciences Co., Ltd.*1 0.89 1,979 5,890 5,890
LG China Fund 1st 12.50 1,250 1,250 1,250 Kocref Cr-reit VII 6.67 4,000 5,056 5,056
MIC 2001-18 LG Investment Fund 7 3.60 450 385 385 Macquarie Central Office 3.93 3,000 4,386 4,386
IMM Performance Investment Fund 10.00 1,000 1,000 1,000 Ssangyong Motor Company *3 0.44 5,867 3,280 3,280
KDB Value II PEF 2.51 5,800 5,800 5,800 Hynix Semiconductor Inc. 0.01 1,001 1,027 1,027
KDB Venture M&A PEF 10.00 1,880 1,880 1,880 Others *4 351 614 614
Others *6 3 3 3 Sub-total 123,268 259,650 259,650
Sub-total 20,638 20,573 20,573 Unlisted equity securities:
Total 210,499 446,828 446,828 Suwon Station Development Co., Ltd. 2.73 1,500 1,613 1,500
Kocref Cr-reit II. 11.61 65 67 67
*1_ The Company acquired the shares of common stock of LG Household Healthcare Ltd. and others, which were incorporated
Blue Holdings Co., Ltd. 5.00 250 250 250
through the spin-off from LG Chemical Co., Ltd. and others.
*2_ The Company acquired the shares of common stock of GS Holdings Corp., which was incorporated through the spin-off from Chung Lam School Co., Ltd. 14.99 488 488 488
LG Corporation. Shinhan Infra Portfolio Fund. 10.42 1,041 1,041 1,041
*3_ The shares of common stock of Ssangyong Motor Company were acquired through debt-for-equity swap. Neulpureun Yongin Baeoomteo Co., Ltd. 15.00 602 602 602
*4_ In relation to the litigation with Woori Credit Card, the shares of common stock of Daewoo Engineering & Construction Co., 4.17 417 417 417
Korea BTL l Fund.
Ltd. and Daewoo International Corporation are deposited at a court.
Kyongju SMC Co., Ltd. 2.05 110 110 110
*5_ Among the unlisted equity securities, Suwon Station Development Co., Ltd and Korea Securities Depository were valued by
independent credit rating companies and others were valued at acquisition cost. Kyeong Gi School Co., Ltd. 15.00 553 553 553
*6_ KDB Value II PEF as investment in partnerships is not subject to the equity method although its total ownership is 22% as the Pureun Baeoomteo Co., Ltd. 15.00 491 491 491
Company has no significant influence on the company. Youngduk Enviro Co., Ltd. 12.50 319 319 319
Ripo Incheon Development Co., Ltd. 4.05 2,909 2,909 2,909
Myoungji Bridge Co., Ltd. 0.33 228 228 228
Others 3,852 18 18
Sub-total 12,825 9,106 8,993

LIG INSURANCE CO., LTD.

FY07 ANNUAL REPORT Leaping Forward from 60_ 61
Good to Great

2007 2007
Ownership Acquisition Net book value Book value Face value Acquisition Book value Unrecognized
ratio (%) cost or fair value cost after
amortization gain (loss)*2
Investments in partnerships: Government and public bonds 242,565 242,685 243,991 1,306
LG Jupiter Fund 11th 13.33 2,000 1,906 2,000 Special purpose bonds 581,050 581,043 586,271 5,228
MIC 2001-18 LG Investment Fund 7 12.00 1,500 964 964 Corporate bonds 163,900 162,930 164,108 1,178
KDB Value II PEF 2.63 600 597 600 Debt securities denominated in foreign currencies *1 370,118 372,287 317,883 (54,404)
Others *5 3 3 3 Total 1,357,633 1,358,945 1,312,253 (46,692)
Sub-total 4,103 3,470 3,567
*1_ Credit Linked Note (CLN) amounting to 105,914 million and Synthetic CDO amounting to 9,448 million are included in
Total 140,196 272,226 272,210
debt securities denominated in foreign currencies.
*2_ Unrecognized gain (loss) on debt securities denominated in foreign currencies consists of 2,223 million of loss on valuation
*1_ The Company acquired the shares of common stock of LG Household Healthcare Ltd. and others, which were incorporated
of available-for-sale securities resulting from fair value method of debt securities denominated in foreign currencies, 51,085
through the spin-off from LG Chemical Co., Ltd. and others.
million of loss on translation foreign currencies resulting from application of fair value hedging accounting to hedged debt
*2_ The Company acquired the shares of common stock of GS Holdings Corp., which was incorporated through the spin-off from
securities denominated in foreign currencies, and 1,096 million of accumulated loss on overseas operations translation.
LG Corporation.
*3_ The shares of common stock of Ssangyong Motor Company were acquired through debt-for-equity swap.
*4_ In relation to the litigation with Woori Credit Card, the shares of common stock of Daewoo Engineering & Construction Co., The fair value of debt securities (including debt securities denominated in foreign currencies) is calculated by the
Ltd. and Daewoo International Corporation are deposited at a court.
arithmetic average of recent market price provided by NICE Pricing Services Inc. and KIS Pricing Inc, and the fair
*5_ KDB Value II PEF as investment in partnerships is not subject to the equity method although its total ownership is 22% as the
value of debt securities denominated in foreign currencies possessed by overseas branches is calculated using the recent
Company has no significant influence on the company.
market price announced by a price providing institution.

(4) Available-for-sale securities other than the above investment in equity and debt securities as of March
(3) Available-for-sale debt securities as of March 31, 2008 and 2007 are as follows (Unit: Won in millions): 31, 2008 and 2007 are as follows (Unit: Won in millions):

2008 2008
Face value Acquisition Book value Unrecognized Impairment Acquisition Fair value Book value Unrecognized Impairment
cost after gain (loss)*2 loss cost gain (loss) loss
amortization
Government and public bonds 515,089 493,078 494,395 1,317 - Beneficiary certificates *1 152,756 159,934 159,934 7,178 -
Special purpose bonds 577,250 577,195 578,411 1,216 - Other securities denominated in foreign 49,472 43,313 43,313 6,743 (12,902)
Corporate bonds 143,000 142,012 140,811 (1,201) - currencies *2

Debt securities denominated in foreign 260,963 248,148 222,296 (14,715) (11,137) Other securities *3 76,745 74,920 74,920 (1,727) (98)
currencies *1
Total 278,973 278,167 278,167 12,194 (13,000)
Total 1,496,302 1,460,433 1,435,913 (13,383) (11,137)
*1_ Since the Company’s treasury stock fund is included in beneficiary certificates, these fund assets are separately recorded and
*1_ Credit Linked Note (CLN) amounting to 29,218 million and Synthetic CDO amounting to 9,081 million are included in gain on valuation is proportionately recorded based on asset composition pursuant to SKAS No.8 (Investments in Securities).
debt securities denominated in foreign currencies. Taberna Preferred Funding II amounting to 6,758 million and As a result, the difference between acquisition cost and book value in investment securities does not tally with gain (loss) on
Mantoloking CDO amounting to 4,379 million are recognized as impairment loss considering the decline in fair value is valuation, of which the difference is 146 million.
material and unrecoverable. *2_ Unrecognized gain (loss) on debt securities denominated in foreign currencies consists of 6,677 million of gain on valuation
*2_ Unrecognized gain (loss) on debt securities denominated in foreign currencies consists of 13,183 million of loss on valuation of available-for-sale securities resulting from fair value method of debt securities denominated in foreign currencies and 66
of available-for-sale securities resulting from fair value method of debt securities denominated in foreign currencies, 5,705 million of loss on translation foreign currencies resulting from application of fair value hedging accounting to hedged debt
million of loss on translation foreign currencies resulting from application of fair value hedging accounting to hedged debt securities denominated in foreign currencies.
securities denominated in foreign currencies, and 4,173 million of accumulated loss on overseas operations translation. *3_ Credit Linked Deposit (CLD) amounting to 21,100 million, Derivatives Linked Securities (DLS) amounting to 15,008 mil-
lion and contract of entrusted investment amounting to 13,753 million are included in other available-for-sale securities as
of March 31, 2008.

LIG INSURANCE CO., LTD.

FY07 ANNUAL REPORT Leaping Forward from 62_ 63
Good to Great

2007 2008
Acquisition Fair value Book value Unrecognized Impairment Accounts Classification List of assets Book value
cost gain(loss) loss SEI entrusted investment Stocks (LG and others) 3,884
Other securities
Beneficiary certificates *1 95,851 97,512 97,512 1,661 - Deposits and others 225
Other securities denominated in foreign 44,628 31,839 31,839 3,001 (15,790) Total 4,109
currencies *2 TAURUS entrusted investment Stocks (Samsung and others) 4,329
Other securities *3 46,278 46,799 46,799 640 (119) Deposits and others 117
Total 186,757 176,150 176,150 5,302 (15,909) Total 4,446
TUBE entrusted investment Stocks (POSCO and others) 4,706
*1_ Since the Company’s treasury stock fund is included in beneficiary certificates, these fund assets are separately recorded and
Deposits and others 492
gain on valuation is proportionately recorded based on asset composition pursuant to SKAS No.8 (Investments in Securities).
Total 5,198
As a result, the difference between acquisition cost and book value in investment securities does not tally with gain (loss) on
valuation, of which the difference is 264 million.
*2_ Unrecognized gain (loss) on debt securities denominated in foreign currencies consists of 3,582 million of gain on valuation 2007
of available-for-sale securities resulting from fair value method of debt securities denominated in foreign currencies and 581 Accounts Classification List of assets Book value
million of loss on translation foreign currencies resulting from application of fair value hedging accounting to hedged debt
Other securities IMM entrusted investment II Stocks (Hite beer and others) 9,875
securities denominated in foreign currencies.
Deposits and others 423
*3_ Since Mugunghwa Fund is in the process of liquidation, it is concluded that the differences between net asset value and book
value are significant and it is difficult to recover their net asset value. Therefore, these funds are recorded at net asset value after Accrued dividends 130
recognizing impairment loss. In addition, Credit Linked Deposit (CLD) amounting to 31,000 million and contract of Total 10,428
entrusted investment amounting to 15,640 million are included in other available-for-sale securities as of March 31, 2007. SEI entrusted investment Stocks (SK and others) 4,906
Deposits and others 218
The fair value of beneficiary certificates is the trading base price provided by fund management companies, and the fair Accrued dividends 88
value of securities denominated in foreign currencies and other securities is the base price provided by asset manage- Total 5,212
ment companies. In addition, the Company records its treasury stock fund as beneficiary certificates except for its trea-
sury stock.
(6) The details of gains or losses on valuation of available-for-sale securities recognized in accumulated
(5) Contract of entrusted investment other comprehensive income (loss) as of March 31, 2008 and 2007 are as follows (Unit: Won in millions):
The Company contracts with IMM Investment Management Co., Ltd. and SEI Asset Korea co., Ltd. for the entrusted
2008
investments of certain available-for-sale securities as of March 31, 2008. The details of entrusted investment on avail-
Category Beginning balance Increase (decrease) Realized Ending balance (*)
able-for-sale for the year ended March 31, 2008 are enumerated below. Based on this contract, gain (loss) on contract
Equity securities:
of entrusted investment amounts to (1,247) million and 640 million as of March 31, 2008 and 2007.
Marketable equity securities 139,916 102,395 5,438 236,873
Unlisted equity securities 2 838 (9) 849
Equity investments - 324 227 97
Sub-total 139,918 103,557 5,656 237,819
Debt securities:
Government and public bonds 1,306 102 91 1,317
Special purpose bonds 5,228 (3,179) 833 1,216
Corporate bonds 1,178 (2,114) 265 (1,201)
Debt securities denominated (2,223) (8,006) 2,954 (13,183)
in foreign currencies

Sub-total 5,489 (13,197) 4,143 (11,851)

LIG INSURANCE CO., LTD.

FY07 ANNUAL REPORT Leaping Forward from 64_ 65
Good to Great

2008 (7) Maturities of available-for-sale debt securities as of March 31, 2008 is as follows (Unit: Won in mil-
Category Beginning balance Increase (decrease) Realized Ending balance * lions):
Others:
Maturity Government and Special bonds Corporate Securities denominated Total
Beneficiary certificates 1,925 5,629 230 7,324 public bonds bond in foreign currencies.
Securities denominated in 3,582 3,095 - 6,677
foreign currencies Within 1 year 24,959 42,068 10,060 29,685 106,772
Over 1 ~ 3 years 9,735 215,134 101,842 20,222 346,933
Other securities 640 (1,727) 640 (1,727)
Over 3 ~ 5 years 114,759 134,766 19,230 2,224 270,979
Sub-total 6,147 6,997 870 12,274
Over 5 ~ 10 years 344,942 149,839 9,679 110,879 615,339
Total 151,554 97,357 10,669 238,242
10 years and more - 36,604 - 59,286 95,890
Effect of income tax 41,667 65,517
Total 494,395 578,411 140,811 222,296 1,435,913
Gain on valuation 109,877 172,725

*_ Pursuant to SKAS No.16 (Income Taxes), the ending balance is presented at net value, of which the gain on valuation of avail-
(8) The details of gains and losses on available-for-sale for the years ended March 31, 2008 and 2007 are as
able-for-sale securities is net of income tax (27.5%).
follows (Unit: Won in millions):

2008
2007
Disposal Interest Translation *1 Impairment loss /recovery *2 Total
Category Beginning balance Increase (decrease) Realized Endingbalance *
Gains 18,820 87,147 6,137 2,405 114,509
Equity securities:
Losses 268 - - 11,137 11,405
Marketable equity securities 143,070 15,317 18,471 139,916
Unlisted equity securities 245 (243) - 2 *1_ Loss on translation foreign currencies resulting from application of fair value hedging accounting to hedged debt securities
106 (106) - - denominated in foreign currencies is reflected in the income statement.
Equity investments
*2_ Loss on impairment of Seoul Guarantee Insurance recognized in prior year was reversed partially based on the data from NICE
Sub-total 143,421 14,968 18,471 139,918
Pricing Services Inc. and KIS Pricing Inc, considering settlement in capital encroachment after reduction in capital stock. In
Debt securities: addition, loss on impairment of Taberna Preferred Funding II and Mantoloking CDO amounting to 6,758 million and
Government and public bonds 43 1,285 22 1,306 4,379 million, respectively, was recognized considering the decrease of fair value is material and irrecoverable.
Special purpose bonds 8,391 (3,140) 23 5,228
Corporate bonds 2,014 (112) 724 1,178
2007
Debt securities denominated (3,348) 894 (231) (2,223)
in foreign currencies Disposal Interest Translation *1 Impairment loss /recovery *2 Total

7,100 (1.073) 538 5,489 Gains 56,806 74,941 71 501 132,319

Sub-total
Losses 176 - 6,505 963 7,644
Others:
Beneficiary certificates 1,158 838 71 1,925
*1_ Loss on translation foreign currencies resulting from application of fair value hedging accounting to hedged debt securities
Securities denominated in 10,123 1,564 8,105 3,582 denominated in foreign currencies is reflected in the income statement.
foreign currencies *2_ The Company reversed the loss on impairment on Suwon Aekyung Station Development Co., Ltd. recognized before FY 2007
Other securities - 640 - 640 because net assets exceed the acquisition cost due to improvement of operational environment.
For MIC 2001-18 LG Investment VII (investment in partnerships) and Mugungwha fund (other securities), the difference
Sub-total 11,281 3,042 8,176 6,147
between net asset value and book value is material and is recorded at net asset value considering the recovery of net asset value
Total 161,802 16,937 27,185 151,554 is uncertain.
Effect of income tax 44,496 41,677
Gain on valuation 117,306 109,877

*_ Pursuant to SKAS No.16 (Income Taxes), the ending balance is presented at net value, of which the gain on valuation of avail-
able-for-sale securities is net of income tax (27.5%).

LIG INSURANCE CO., LTD.

FY07 ANNUAL REPORT Leaping Forward from 66_ 67
Good to Great

7. HELD-TO-MATURITY SECURITIES: 2007

(1) Held-to-maturity debt securities as of March 31, 2008 and 2007 are as follows (Unit: Won in millions): Disposal Interest Translation Impairment loss /recovery Total
Gains - 15,186 - - 15,186
2008 2007 Losses - - 3,847 - 3,847
Face Acquisition cost Book Face Acquisition cost Book
value after amortization*1 value value after amortization*1 value

Special bonds 97,300 97,039 97,039 113,000 112,756 112,756 (4) The details of structured securities in relation to interest rate as of March 31, 2008 and 2007 are as fol-
Securities denominated in lows (Unit: Won in millions):
foreign currencies *2
66,056 54,494 54,494 127,179 101,509 101,509
Total 163,356 151,533 151,533 240,178 214,265 214,265 Accounts Classification 2008 2007
Cash and bank deposits Dual index FRN 20,000 20,000
*1_ It is adjusted using the effective interest rate method.
Range Note 20,000 -
*2_ Debt securities denominated in foreign currencies include Credit Linked Note (CLN) amounting to 28,209 million as of
Trading securities Dual index FRN 50,315 -
March 31, 2008.
Available-for-sale Dual index FRN 217,191 129,115
QUANTO 44,305 48,776

(2) Fair value of held-to-maturity debt securities, by remaining contractual maturities, as of March 31, Range Note 44,314 43,489

2008 is as follows (Unit: Won in millions): CMS Spread Note 59,111 38,839
Held-to-maturity Range Note 19,834 18,806
Maturity Special bonds Securities denominated In Total CMS Spread Note - 18,806
foreign currencies
Total 475,070 317,831
Within 1 year 7,300 1,983 9,283
Call option is granted to structured securities amounting to 154,442 million and 120,543 million for the years
Over 1 ~ 3 years 9,739 12,892 22,631
ended March 31, 2008 and 2007, respectively.
Over 3 ~ 5 years 60,000 14,888 61,488
Over 5 ~ 10 years 20,000 19,834 39,834
10 years and more - 18,297 18,297
Total 97,039 54,494 15,533 8. EQUITY SECURITIES USING THE EQUITY METHOD:
(1) Equity securities using the equity method as of March 31, 2008 and 2007 consist of the following
(Unit: Won in millions):
2008
(3) The details of gains and losses on held-to-maturity securities for the years ended March 31, 2008 and
Number of Ownership Acquisition Net book Ending
2007 are as follows (Unit: Won in millions): shares ratio (%) cost value book value

LIG Life Insurance Co., Ltd. *1 2,270,114 37.84 70,846 21,587 21,587
2008
PT. LIG Insurance Indonesia Inc. 224 70.00 5,632 3,885 3,885
Disposal Interest Translation *1 Impairment loss /recovery *1 Total
Daum Direct Automobile Insurance Co., Ltd. *2 5,028,300 25.00 25,142 15,429 26,903
Gains - 74,941 2,824 - 14,704
Kocref Cr-reit VIII 613,400 6.67 3,067 2,918 3,099
Losses 114 - - 2,560 2,674
Myoung Ji Dae Kyo Co., Ltd. *3 526,000 2.78 2,630 2,529 2,609
*1_ Tarrytown Second LLC-1 amounting to 679 million and Tarrytown Second LLC-2 amounting to 1,881 million were Kocref Cr-reit XI *4 500,000 10.00 9,500 9,626 9,626
recognized as impairment considering the redemption possibility of maturity value is uncertain. Kocref Cr-reit VII *3 800,000 6.67 5,224 3,973 5,000
LIG Automobile Insurance Claims Appraisal Co., Ltd. *5 60,000 100.00 300 - 300
LIG Management Services, Inc. *5 100 100.00 2,105 - 2,105
Total 9,798,138 124,446 59,947 75,114

LIG INSURANCE CO., LTD.

FY07 ANNUAL REPORT Leaping Forward from 68_ 69
Good to Great

*1_ LIG Life Insurance Co., Ltd was disposed on April 04, 2008 and the company’s name of LIG Life Insurance Co., Ltd was 2008
changed to Woori Aviva Co., Ltd. on April 1, 2008.
Beginning Equity income Changes Others *5 Ending
*2_ Daum Direct Automobile Insurance Co., Ltd made an increase in capital stock by payment of cash on March 28, 2008. Due to book value on investment in equity *4 book value
no participation in paid-in capital increase, the ratio of ownership decreased to 11.6%. Daum Direct Automobile Insurance
Co., Ltd.’s shares (313,600) were disposed on March 28, 2008 and the ratio of ownership decreased. Kocref Cr-reit XI *2 9,500 521 - (395) 9,626
*3_ Myoung Ji Dae Kyo Co., Ltd. and Kocref Cr-reit VII were reclassified as equity securities using the equity method from FY Kocref Cr-reit VII *3 5,224 (13) - (211) 5,000
2007 because the Company has the ability to exercise significant influence over the associates. LIG Automobile Insurance Claims Appraisal Co., Ltd.*1 300 - - - 300
*4_ Kocref Cr-reit XI was acquired from FY 2007 and was reclassified as equity securities using the equity method from FY 2007
LIG Management Services, Inc.*2 2,105 - - - 2,105
because the Company has the ability to exercise significant influence over the associates.
*5_ LIG Automobile Claims Appraisal Co., Ltd. and LIG Management Services, Inc. were excluded from the calculation applying Total 67,079 (1,897) 482 9,450 75,114
equity method because their assets are less than 7,000 million as of the end of prior year.
*1_ Net assets value of LIG Life Insurance Co., Ltd., Daum Direct Automobile Insurance Co., Ltd., Myoung Ji Dae Kyo Co., Ltd.
and LIG Automobile Insurance Co., Ltd were calculated based on reliable financial statements as of March 31, 2008. The dif-
ference between unaudited financial statements and audited financial statements was adjusted.
2007
*2_ Net assets values of PT. LIG Insurance Indonesia Inc., Kocref Cr-reit VIII, Kocref Cr-reit XI and LIG Management Services,
Number of Ownership Acquisition Net book Ending Inc are calculated based on its reliable financial statements as of December 31, 2007.
shares ratio (%) cost value book value
*3_ Net assets value of Kocref Cr-reit VII is calculated based on its reliable financial statements as of January 31, 2008.
LIG Life Insurance Co., Ltd. *1 2,270,114 37.84 70,846 18,659 18,659 *4_ Decrease amounting to 10 million due to disposal of Daum Direct Automobile Insurance Co., Ltd. was not included.
*5_ The changes in Daum Direct Automobile Insurance Co., Ltd. were due to increase in capital stock by payment of cash and dis-
PT. LIG Insurance Indonesia Inc. 224 70.00 5,632 3,514 3,514
posal; therefore, the Company recognized gain on disposal amounting to 12,648 million. The changes in Kocref Cr-reit VII,
Daum Direct Automobile Insurance Co., Ltd. *2 5,341,900 38.16 26,710 8,424 22,134
Kocref Cr-reit VIII and Kocref Cr-reit XI were due to dividends received.
Kocref Cr-reit VIII *3 613,400 6.67 3,067 2,988 3,013
LIG Automobile Insurance Claims Appraisal Co., Ltd.*4 60,000 100.00 300 1,513 300
LIG Management Services, Inc. *4 100 100.00 2,105 1,856 2,105 2007
Total 8,285,758 108,660 36,954 49,725 Beginning Equity income Changes Others*3 Ending
book value on investment in equity book value
*1_ The reduction in capital stock without consideration was made in proportion with 6.65:1 on March 30, 2007. Due to equiva-
lent reduction, there is on changes on ratio of ownership. LIG Life Insurance Co., Ltd.*1 13,761 4,977 (79) w - 18,659
*2_ Daum Direct Automobile Insurance Co., Ltd made increase in capital stock by payment of cash on Dec. 29, 2006. Due to par- PT. LIG Insurance Indonesia Inc.*2 3,495 154 (135) - 3,514
ticipation in paid-in capital increase amounting to 4,259 million (851,700 shares), the ratio of ownership increased. Daum Direct Automobile Insurance Co., Ltd.*1 26,710 (4,612) 36 - 22,134
*3_ Kocref Cr-reit VIII was established on May 18, 2006 and is reclassified as equity securities using the equity method from FY
Kocref Cr-reit VIII *2 3,067 59 - (113) 3,013
2006 because the Company has the ability to exercise significant influence over the investee.
LIG Automobile Insurance Claims Appraisal Co., Ltd.*1 300 - - - 300
*4_ LIG Automobile Claims Appraisal Co., Ltd. and LIG Management Services, Inc. were excluded from the calculation applying
equity method because their assets are less than 7,000 million as of the end of prior year. LIG Management Services, Inc.*4 2,105 - - - 2,105
Total 49,438 578 178) (113) 49,725

(2) The valuation of equity securities using the equity method for the years ended March 31, 2008 and *1_ Net assets values of LIG Life Insurance Co., Ltd., Daum Direct Automobile Insurance Co., Ltd. and LIG Automobile Insurance
Co., Ltd were calculated based on reliable financial statements as of March 31, 2007.
2007 are as follows (Unit: Won in millions):
*2_ Net assets values of PT. LIG Insurance Indonesia Inc. and Kocref Cr-reit VIII are calculated based on its audited financial
2008 statements as of December 31, 2006.
*3_ Received dividends from Kocref Cr-reit VIII
Beginning Equity income Changes Others *5 Ending
book value on investment in equity *4 book value *4_ Net assets value of LIG Management Services, Inc. was calculated based on reliable financial statements as of December 31,
2006.
LIG Life Insurance Co., Ltd. *1 18,659 2,758 170 - 21,587
PT. LIG Insurance Indonesia Inc.*2 3,514 198 173 - 3,885
Daum Direct Automobile Insurance Co., Ltd.*1 22,134 (5,443) 139 10,073 26,903
Kocref Cr-reit VIII *2 3,013 103 - (17) 3,099
Myoung Ji Dae Kyo Co., Ltd.*1 2,630 (21) - - 2,609

LIG INSURANCE CO., LTD.

FY07 ANNUAL REPORT Leaping Forward from 70_ 71
Good to Great

(3) Write-off of excess from carrying value as of March 31, 2008 is as follows (Unit: Won in millions): 2008
Assets Liabilities Operating Net income
Eliminated invest Amortization of income (loss)
Underlying net ment account eliminated invest-
ment account
Kocref Cr-reit XI 222,866 126,601 11,779 5,212
Investments at assets value at the Differnce year Current Up to
cost time of investment incurred year prior years Kocref Cr-reit VII *3 125,697 66,106 3,869 1,513
LIG Automobile Insurance Claims Appraisal Co., Ltd. 3,309 1,547 17,598 250
LIG Life Insurance Co., Ltd. 50,000 (7,969) 57,696 FY1999 - 57,969
LIG Management Services, Inc. 2,576 594 6,477 (9)
846 646 200 FY2004 - 200
Total 2,213,140 1,794,416 890,248 5,312
20,000 17,329 2,671 FY2005 - 2,671
PT. LIG Insurance Indonesia Inc. 5,632 5,632 - - - - *1_ The deferred income tax assets amounting to 5,456 million were deducted in calculating the assets and increase of the
Daum Direct Automobile Insurance Co., Ltd.*1 22,451 7,609 14,842 FY2005 2,181 1,484 deferred income tax assets amounting to 3,709 million and decrease of the retained earnings carried over from prior year
Insurance Co., Ltd.*1 4,259 3,898 361 FY2006 55 9 amounting to 9,814 million were deducted in calculating net income of Daum Direct Automobile Insurance Co., Ltd. as of
and for the year ended March 31, 2008.
Kocref Cr-reit VIII 3,226 2,988 238 FY2006 57 -
*2_ Revised asset balance reflects dividends amounting to 1,802 million.
Myoung Ji Dae Kyo Co., Ltd. 1,701 1,643 58 FY2007 4 - *3_ Kocref Cr-reit VII is for the year ended Oct and April, and balance of assets and liabilities is as of January 31, 2008 (2nd quarter
929 902 27 FY2007 1 - financial statements). In addition, the gain on valuation of equity securities is calculated from the 6 months net income after
Kocref Cr-reit XI 9,500 9,500 - - - - acquisition (August 2007 ~ January 2008).
Kocref Cr-reit VII 5,224 3,992 1,232 FY2007 205 -
LIG Automobile Insurance
Claims AppraisalCo., Ltd. 300 300 - - - - 2007

LIG Management Services, Inc. 2,105 2,105 - - - - Assets Liabilities Operating Net income
income (loss)
Total 126,173 48,575 77,598 2,503 62,333
LIG Life Insurance Co., Ltd. *1 1,300,015 1,250,369 506,311 13,469
*1_ Since the Company concluded that the deferred income tax assets amounting to 9,892 million and 10,370 million present- PT. LIG Insurance Indonesia Inc. 9,705 4,685 11,862 220
ed in unaudited financial statements of Daum Direct Automobile Insurance Co., Ltd. as of March 31, 2005 and 2006 would
Daum Direct Automobile Insurance Co., Ltd.*1*2 131,968 109,890 274,177 (8,205)
not be realized, the Company deducted the same amount in the financial statements of Daum Direct Automobile Insurance
Kocref Cr-reit VIII *3 122,188 77,373 5,858 970
Co., Ltd. for calculating the difference between the eliminated investment account incurred at the time of acquisition and the
amount of goodwill. In addition, the Company amortizes the difference between the eliminated investment account incurred LIG Automobile Insurance Claims Appraisal Co., Ltd. 2,445 932 15,449 41
at the time of acquisition and the amount of goodwill for ten years. LIG Management Services, Inc. 1,878 22 3,562 4
Total 1,568,199 1,443,271 817,219 6,499

(4) Significant financial data of companies accounted for using the equity method as of and for the years *1_ LIG Life Insurance Co., Ltd and Daum Direct Automobile Insurance Co., Ltd - revised balance reflecting audited financial
ended March 31, 2008 and 2007 is as follows (Unit: Won in millions): statement of prior year
*2_ The deferred income tax assets amounting to 9,165 million were deducted in calculating the assets and increase of the
deferred income tax assets amounting to 727 million were deducted in calculating net income of Daum Direct Automobile
2008
Insurance Co., Ltd. as of and for the year ended March 31, 2007.
Assets Liabilities Operating Net income *3_ Revised asset balance reflects dividends amounting to 1,700 million.
income (loss)

LIG Life Insurance Co., Ltd. 1,380,977 1,323,922 472,610 7,016

PT. LIG Insurance Indonesia Inc. 10,673 5,123 12,619 284
Daum Direct Automobile Insurance Co., Ltd.*1 223,327 161,612 355,030 (10,283)
Kocref Cr-reit VIII *2 121,972 78,215 10,266 2,400
Myoung Ji Dae Kyo Co., Ltd. 121,743 30,696 - (1,071)

LIG INSURANCE CO., LTD.

FY07 ANNUAL REPORT Leaping Forward from 72_ 73
Good to Great

9. LOANS: 2007
(1) In accordance with the Insurance Business Act and Regulation on Supervision of Insurance Business, Maturity Policy loans Loans secured Unsecured Loans secured Other loans Total
by real estate loans by third party
the Company provides various loans. As of March 31, 2008, 20,053 million ( 19,280 million as of guaratees

March 31, 2007) of secured loans and 21,881 million ( 20,136 million as of March 31, 2007) of credit Within 1 year 48,257 19,007 13,602 1,099 100,985 182,950
loans are related to the Company’s employees loans. The annual interest rate of the Company’s loans is as Over 1 ~ 2 years 44,391 81,694 83,880 233 156,208 366,406
follows: Over 2 ~ 3 years 28,349 25,235 40,301 429 82,334 176,648
Over 3 ~ 4 years 37,698 61,268 7 675 27,008 126,656
Description 2008 Over 4 ~ 5 years 23,304 69,767 6,602 751 58,557 158,981
Policy loans 6.00~10.00 5 years and more 187,820 545,187 28,305 18,719 152,106 932,137
Loans secured by real estate 5.00~9.50 Total 369,819 802,158 172,697 21,906 577,198 1,943,778
Unsecured loans 5.00~16.00
Loans secured by third party guarantees 6.50~11.50
Other loans 4.53~15.00 (4) The details of allowance for loan losses as of March 31, 2008 and 2007 are as follows

2008 2007
Policy loans 3,335 2,747
(2) Loans as of March 31, 2008 and 2007 are as follows (Unit: Won in millions):
Loans secured by real estate 7,990 6,824

2008 2007 Unsecured loans 1,180 4,119

Policy loans 447,138 369,819 Loans secured by third party guarantees 181 221

Loans secured by real estate 983,035 802,158 Other loans 17,215 7,262

Unsecured loans 228,605 172,697 Insurance receivables 3,508 2,549

Loans secured by third party guarantees 23,089 21,906 Other accounts receivable 2,495 2,915

Other loans 790,835 577,198 Accrued revenue 87 95

2,472,702 1,943,778 Notes receivable 2 2

Deferred incident income and expenses 964 916 Dishonored notes receivable 6,092 5,561

Allowance for loan losses (29,901) (21,174) Total 35,993 26,734

Total 2,443,765 1,923,520

The ratio of the allowance for loan losses to total loans as of March 31, 2008, 2007 and 2006 is 1.4%, 1.3% and 1.7%,
respectively.

(3) Maturities of loans as of March 31, 2008 and 2007 are as follows (Unit: Won in millions):

2008
Maturity Policy loans Loans secured Unsecured Loans secured Other loans Total
by real estate loans by third party
guaratees
Within 1 year 49,269 57,807 39,088 746 160,064 306,974
Over 1 ~ 2 years 35,633 22,468 86,257 210 135,539 280,107
Over 2 ~ 3 years 51,950 54,116 76,560 416 78,560 261,602
Over 3 ~ 4 years 34,770 78,692 4,850 580 72,922 191,814
Over 4 ~ 5 years 31,782 68,955 19 636 83,179 184,571
5 years and more 243,734 700,997 21,831 20,501 260,571 1,247,634
Total 447,138 983,035 228,605 23,089 790,835 2,472,702

LIG INSURANCE CO., LTD.

FY07 ANNUAL REPORT Leaping Forward from 74_ 75
Good to Great

(5) The classification of asset quality for the assets required for assets classification as of March 31, 2008 2007
and 2007 are as follows (Unit: Won in millions): Normal Precautionary Substandard Doubtful Estimated Total
loss
2008 Other receivables:
Normal Precautionary Substandard Doubtful Estimated Total Insurance receivables 19,109
25,462 2,203 1,326 815 48,915
loss
Other accounts receivable 45,269 322 184 2,555 1,369 49,699
Loans: Accrued revenue 14,879 135 - - - 15,014
Policy loans *1 447,138 - - - 447,138 Notes receivable 451 - - - - 451
Loans secured by real estate *2 973,275 5,925 3,835 - - 983,035 Sub-total 86,061 19,566 2,387 3,881 2,184 114,079
Unsecured loans 228,469 33 - 67 36 228,605 Total 1,997,477 39,539 8,156 10,328 2,357 2,057,857
Loans secured by third
party guarantees 22,984 101 - 1 3 23,089 *1_ Mortgage loans provided together with Korea Housing Finance Corp. amount to 2,353 million as of March 31, 2007.
Other loans *3 742,129 14,800 25,091 8,815 - 790,835 *2_ The balance of restructured loan amounting to 3,467 million is classified as doubtful in unsecured loans.

Sub-total 2413,995 25,859 28,926 8,883 39 2,472,702

Other receivables:
Insurance receivables *4 15,562 19,539 2,126 1,204 1,886 40,317 (6) Other receivables, which the Company classified as estimated loss but still has legal claim rights as of
Other accounts receivable 37,700 934 250 143 2,169 41,196 March 31, 2008 and 2007 are as follows (Unit: Won in millions):
Accrued revenue *5 12,667 178 - - - 12,845
Notes receivable 302 - - - - 302 2008 2007
Sub-total 66,231 20,651 2,376 1,347 4,055 94,660 Debtors Amount of Amount of Amount of Amount of
Total loan claim loan claim
2,480,226 41,510 31,302 10,203 4,094 2,567,362

Losses Kim Min Soo and 11 other debtors 39 39 173 173

*1_ Policy loans include amount of cancellation refund pursuant to an insurance policy.
Other accounts receivable Yon Yoon Heum and 102 other debtors 2,169 2,169 1,369 1.369
*2_ Mortgage loans provided together with Korea Housing Finance Corp. amount to 4,645 million as of March 31, 2008.
*3_ Loans secured by securities, Project Financing (PF) and CP discount and others are included. Total 2,208 2,208 1,542 1.542
*4_ In accordance with the Regulation on Supervision of Insurance Business, an allowance for insurance receivables, net of insur-
ance account payables by customers and account codes, is provided.
*5_ Accrued revenue includes only accrued interest income earned from above loans.

(7) The change in deferred incident income and expenses from loans as of March 31, 2008 is as follows
(Unit: Won in millions):
2007
Normal Precautionary Substandard Doubtful Estimated Total Beginning Year Amortization Ending
loss book value incurred (Reversal) * book value
Loans: 3,641 1,714 997 4,358
Deferred loans auxiliary expense
Policy loans 369,819 - - - 369,819 (2,725) (2,066) (1,397) (3,394)
Deferred loans auxiliary revenue
Loans secured by real estate *1 793,100 4,882 4,176 - - 802,158 916 352) (400) 964
Deferred loans auxiliary gain (loss)
Unsecured loans *2 168,795 166 - 3,598 138 172,697
Loans secured by third *_ Deferred incident income and expenses from loans are amortized using the effective interest method and the amortized
party guarantees 21,712 125 - 34 35 21,906 amount is added (subtracted) to interest income.

Other loans 557,990 14,800 1,593 2,815 - 577,198

Sub-total 1,911,416 19,973 5,769 6,447 173 1,943,778

LIG INSURANCE CO., LTD.

FY07 ANNUAL REPORT Leaping Forward from 76_ 77
Good to Great

10. TANGIBLE ASSETS AND INTANGIBLE ASSETS: (3) The change in tangible assets and intangible assets for the years ended March 31, 2008 and 2007 are as
(1) The details of the published value of land as of March 31, 2008 and 2007 are as follows (Unit: Won in follows (Unit: Won in millions):
millions):
2008
Book value Published vlalue
Type Beginning Acquisition Disposal Transfer Depreciation/ Ending
2008 2007 2008 2007 book value from other Amortization book value
28,074 28,074 40,847 34,912 accounts
Head office
Tangible assets Land 129,060 82 8,774 - - 120,368
Branches 92,294 100,986 86,506 86,759
Buildings 383,558 92 4,209 - 10,698 368,743
Total 120,368 129,060 127,353 121,671
Furniture 24,943 10,550 110 - 13,397 21,986
Vehicles 177 49 - - 104 122
Construction in 24,236 27,304 - - - 51,540
(2) Tangible assets and intangible assets as of March 31, 2008 and 2007 are as follows (Unit: Won in mil- progress
lions):
Overseas realty 1,174 - - - 23 1,151
2008
Sub-total 563,148 38,077 13,093 - 24,222 563,910
Type Acquisition Accumulated Net book
cost depreciation value Intangible assets Software 18,253 3,651 - - 5,934 15,970
Total 581,401 41,728 13,093 - 30,156 579,880
Tangible assets Land 120,368 - 120,368
Buildings 422,634 53,891 368,743
Furniture 68,953 46,967 21,986
Vehicles 645 523 122 2007
Type Beginning Acquisition Disposal Transfer Depreciation/ Ending
Construction in progress 51,540 - 51,540 from other Amortization
book value book value
Overseas realty 1,204 53 1,151 accounts
Sub-total 665,344 101,434 563,910 Tangible assets Land 128,998 62 - - - 129,060

Software 15,970 - 15,970 Buildings 393,869 593 - - 10,904 383,558

Intangible assets
Total 681,314 101,434 579,880 Furniture 32,458 12,748 978 (2) 19,283 24,943
Vehicles 72 223 - - 118 177
Construction in 14,103 10,133 -
progress
- - 24,236
2007
Overseas realty 1,185 12 - - 23 1,174
Type Acquisition Accumulated Net book
cost depreciation value Sub-total 570,685 23,771 978 (2) 30,328 563,148
Intangible assets Software 12,339 12,703 - - 6,789 18,253
Tangible assets Land 129,060 - 129,060
Total 583,024 36,474 978 (2) 37,117 581,401
Buildings 430,074 46,516 383,558
Furniture 97,978 73,035 24,943
Vehicles 699 522 177
(4) The Company revalued certain tangible assets in accordance with the Korean Assets Revaluation Law
Construction in progress 24,236 - 24,236
effective on July 1, 1998. As a result, the revaluation increment of 43,722 million ($44,802 thousand) was
Overseas realty 1,204 30 1,174
credited to capital surplus as assets revaluation reserve. In addition, the Company paid 870 million ($891
Sub-total 683,251 120,103 563,148
thousand) of tax in connection with revaluation. However, the assets revaluation reserve is nil as of March
Intangible assets Software 18,253 - 18,253
31, 2004 as the assets revaluation reserve of 42,836 million ($43,894 thousand) was wholly offset with the
Total 701,504 120,103 581,401
accumulated deficit in 2001 as allowed by the Korean Assets Revaluation Law.

LIG INSURANCE CO., LTD.

FY07 ANNUAL REPORT Leaping Forward from 78_ 79
Good to Great

(5) As of March 31, 2008, buildings and equipment are insured against fire and other casualty, and the 12. INSURANCE ACCOUNTS RECEIVABLE:
details are as follows (Unit: Won in millions): Insurance accounts receivable as of March 31, 2008 and 2007 is as follows (Unit: Won in millions):

Type of insurance Insured assets Insurance company Amount insured 2008 2007
General estate insurance LIG Tower and 15 others Hyundai Fire Marine Insurance Co. 468,997 Insurance receivables 15,101 2,654
General estate insurance Fixtures Hyundai Fire Marine Insurance Co. 98,764 Due to agents 1,756 9,003
Body liability insurance LIG Tower and 18 others Hyundai Fire Marine Insurance Co. 80 Co-insurance payable 6,621 5,657
Insurance for equipment LIG Tower and 11 others Hyundai Fire Marine Insurance Co. 25,099 Receivables related to agency business 12,735 11,342
Operation liability insurance LIG Tower and 16 others Hyundai Fire Marine Insurance Co. 2,500 Reinsurance accounts receivable 47,133 45,110
Liability insurance for gas accident LIG Tower and 10 others Hyundai Fire Marine Insurance Co. 300 Overseas reinsurance premiums receivable 25,230 30,093
Liability insurance for leaseholder All leases Hyundai Fire Marine Insurance Co. 5,000 Deposits on reinsurance treaty ceded 1,718 1,696
Total 600,740 Sub-total 110,294 105,555
Less: Allowance for doubtful accounts (3,508) (2,549)
In addition, the Company carries general insurance for vehicles with Hyundai Fire Marine Insurance Co. Total 106,786 103,006

(6) 28,315 million and 27,550 million are secured for leasehold deposits received as of March 31,
13. COMPENSATION RECEIVABLES:
2008 and 2007, respectively.
Compensation receivables as of March 31, 2008 and 2007 are as follows (Unit: Won in millions):

2008
11. OTHER ASSETS: General insurance Automobile Assumed reinsur- Total
Other assets as of March 31, 2008 and 2007 are as follows (Unit: Won in millions): insurance ance guarantee

Beginning balance 2,983 42,150 54 45,187

2008 2007 Net increase (decrease)* 608 (823) 2 (213)
Intangible assets (Note 10) 15,970 18,253 Ending balance 3,591 41,327 56 44,974
Insurance accounts receivable, net (Note 12) 106,786 103,006
Receivables, net 38,702 46,786 *_ It is reflected in current operation as gains on compensation receivables.
Accrued revenues, net 65,023 57,724
Notes receivable, net 301 449
Deposits received 114,125 111,832 2007
Prepaid expenses 1,913 1,457 General insurance Automobile Assumed reinsur- Total
Compensation receivables (Note 13) 44,974 45,187 insurance ance guarantee
Deferred acquisition costs (Note 14) 528,731 450,784
Beginning balance 2,045 38,449 144 40,638
Advanced payments 28,302 4,421
Net increase (decrease)* 938 3,701 (90) 4,549
Prepaid income tax - 9,900
Ending balance 2,983 42,150 54 45,187
Prepaid value added tax 245 168
Security deposits 3,972 2,961 *_ It is reflected in current operation as gains on compensation receivables.
Derivatives assets 6,824 62,555
Total 955,868 915,483

LIG INSURANCE CO., LTD.

FY07 ANNUAL REPORT Leaping Forward from 80_ 81
Good to Great

14. DEFFERED ACQUISITION COSTS: 2008

As of March 31, 2008 and 2007, changes in deferred acquisition costs are as follows (Unit: Won in millions): Classification Beginning Increase * Decrease Ending
balance balance

2008 Reserve for outstanding claims:

Beginning balance Increase Decrease Ending balance General insurance 242,909 146,989 - 389,898
Automobile insurance 240,809 4,798 - 245,607
Individual insurance 17,544 15,128 8,478 24,194 Long-term insurance 140,740 25,416 - 166,156
Long-term insurance 433,240 298,942 227,645 504,537 Sub-total 624,458 177,203 - 801,661
Total 450,784 314,070 236,123 528,731 Reserve for long-term deposits:
Long-term insurance 3,566,574 691,406 - 4,257,980
Sub-total 3,566,574 691,406 - 4,257,980
Unearned premium reserve:
2007
General insurance 227,900 24,701 - 252,601
Beginning balance Increase Decrease Ending balance
Automobile insurance 515,126 7,171 - 522,297
Long-term insurance 10,440 - 532 9,908
Individual insurance 13,826 10,705 6,987 17,544
Sub-total 753,466 31,872 532 784,806
Long-term insurance 307,638 322,438 196,836 433,240
Reserve for participating policyholders’ dividends;
Total 321,464 333,143 203,823 450,784
Long-term insurance 19,394 12,065 2,709 28,750
Sub-total 19,394 12,065 2,709 28,750
Participating policyholder dividend reserve:
Long-term insurance 11,133 2,929 - 14,062
15. INSURANCE RESERVES:
Sub-total 11,133 2,929 - 14,062
(1) Policy reserve:
Total 4,655,172 749,598 3,241 5,401,529
Policy reserves as of March 31, 2008 and 2007 are as follows (Unit: Won in millions):

*_ Gain on overseas operation translation in U.S. branch ( 2,324 million) and reserve Royal & Sun Alliance( 124
2008 million) are excluded from the increase.
Classification Beginning Increase * Decrease Ending
balance balance
2007
Reinsurance reserve: (Reserve for outstanding claims) Classification Beginning Increase * Decrease Ending
General insuranc (149,025) (141,563) - (290,588) balance balance
Automobile insuranc (4,398) (1,571) - (5,969) Reinsurance reserve: (Reserve for outstanding claims)
Long-term insurance (29,159) (1,085) - (30,244) General insurance (142,958) (6,067) - (149,025)
Sub-total (182,582) (144,219) - (326,801) Automobile insurance (4,335) (63) - (4,398)
(Unearned premium reserve) Long-term insurance (23,958) (5,201) - (29,159)
General insurance (123,203) (14,722) - (137,925) Sub-total (171,251) (11,331) - (182,582)
Automobile insurance (14,066) (6,936) - (21,002) (Unearned premium reserve)
Long-term insurance (2) - - (2) General insurance (104,653) (18,550) - (123,203)
Sub-total (137,271) (21,658) - (158,929) Automobile insurance (13,374) (692) - (14,066)
(319,853) (165,877) - (485,730) Long-term insurance - (2) - (2)
Sub-total (118,027) (19,244) - (137,271)
(289,278) (30,575) - (319,853)

LIG INSURANCE CO., LTD.

FY07 ANNUAL REPORT Leaping Forward from 82_ 83
Good to Great

2007 16. BORROWINGS:

Classification Beginning Increase * Decrease Ending The Company recognized outstanding checks from Shinhan Bank amounting to 14,696 million as borrowing
balance balance
account.
Reserve for outstanding claims:
General insurance 230,833 12,076 - 242,909
Automobile insurance 207,367 33,442 - 240,809
17. OTHER LIABILITIES:
Long-term insurance 94,868 45,872 - 140,740
Other liabilities as of March 31, 2008 and 2007 are as follows (Unit: Won in millions):
Sub-total 533,068 91,390 - 624,458
Reserve for long-term deposits:
2008 2007
Long-term insurance 2,953,525 613,049 - 3,566,574
Insurance accounts payable (Note 18) 220,060 182,905
Sub-total 2,953,525 613,049 - 3,566,574
Payables 11,146 2,345
Unearned premium reserve:
Accrued expenses 74,206 50,286
General insurance 214,830 13,070 - 227,900
Deferred income tax liabilities (Note 27) 81,053 59,925
Automobile insurance 512,230 2,896 - 515,126
Accrued severance benefits (Note 2) 134,671 123,679
Long-term insurance 9,978 462 - 10,440
Deposits for severance benefits (Note 2) (106,741) (71,943)
Sub-total 737,038 16,428 - 753,466
National Pension Fund payments (Note 2) (1,971) (2,222)
Reserve for participating policyholders’ dividends;
Advanced premiums received 15,385 13,668
Long-term insurance 9,004 10,390 - 19,394
Advanced receipts 5,800 -
Sub-total 9,004 10,390 - 19,394
Income tax payable 7,087 -
Participating policyholder dividend reserve:
Withholdings 9,208 8,129
Long-term insurance 3,956 7,177 - 11,133
Unearned revenues 1,201 873
Sub-total 3,956 7,177 - 11,133
Leasehold deposits received 29,364 29,701
Total 3,947,313 707,859 - 4,655,172
Derivatives liabilities (Note 31) 20,525 1,350

*_ Gain on overseas operation translation in U.S. branch ( 500 million) is excluded from the increase. Miscellaneous liabilities 12,287 8,789
Total 513,281 407,485

(2) Catastrophe reserves:

Catastrophe reserves as of March 31, 2008 and 2007 are as follows (Unit: Won in millions):
18. INSURANCE PAYABLES:
Insurance payables as of March 31, 2008 and 2007 are as follows (Unit: Won in millions):
2008 2007
Beginning balance 347,897 333,883
2008 2007
Transfer to reserve
Claims payable 33,769 32,245
Fire insurance 1,174 1,293
Due to agents 26,496 25,928
Marine insurance - (1,986)
Premiums refund payable 665 584
Automobile insurance 9,841 7,309
Payables related to agency business 6,251 4,439
Casualty insurance 959 6,552
Reinsurance accounts payable 53,034 40,182
Surety insurance (3) (4)
Overseas reinsurance premiums payable 91,311 71,782
Assumed and overseas direct insurance 972 850
Deposits on reinsurance treaty ceded 8,534 7,745
Sub total 12,943 14,014
Total 220,060 182,905
Ending balance 360,840 347,897

LIG INSURANCE CO., LTD.

FY07 ANNUAL REPORT Leaping Forward from 84_ 85
Good to Great

19. ASSETS AND LIABILITIES IN OVERSEAS BRANCH: 2008 2007

Foreign currency denominated assets and liabilities of the overseas branch (American branch) included in the accom- Currency Foreign Korean won Currency Foreign Korean won
curencies equivalent * curencies equivalent *
panying balance sheets as of March 31, 2008 and 2007 are as follows:
U.S. dollars (In thousands) Korean Won equivalent(In millions)
Insurance accounts USD 9,198 9,122 USD 28,877 27,153
receivable
2008 2007 2008 2007
Other assets USD 61 61 USD 42 40
Cash and bank deposits 3,804 3,540 3,773 3,328
Trading securities 100 94 99 89 JPY 1,415 14 JPY 3,542 28
Total assets USD 353,733 349,997 USD 514,960 484,217
Available-for-sale securities 37,484 33,241 37,173 31,257
Other assets 6,936 9,643 6,878 9,067 EUR 7,328 11,468 EUR 10,012 12,553

Assets total 48,324 46,518 47,923 43,741 JPY 32,739 327 JPY 410,601 3,272

Insurance reserve 23,229 18,895 23,036 17,767 GBP 1 3 GBP 77 143

Insurance accounts payable USD 20,170 20,002 USD 75,037 70,557
Other liabilities 5,842 8,711 5,793 8,191
Total liabilities USD 20,170 20,002 USD 75,037 70,557
Liabilities total 29,071 27,606 28,829 25,958

*_ The Korean Won equivalent of assets and liabilities denominated in foreign currencies are translated in these financial
An overseas branch located in the United States of America maintains its accounting records in U.S. dollars. For pre- statements based on the basic rate ( 991.70 to USD1.00, 1,565.00 to EUR1.00, 1,000.20 to JPY100.00 and 1,977.30 to
sentation in the accompanying financial statements, assets and liabilities in financial statements of the overseas branch GBP1.00 at March 31, 2008 and 940.30 to USD1.00, 1,253.94 to EUR1.00, 797.00 to JPY100 and 1,845.53 to GBP1.00 at
March 31, 2007) announced by Seoul Money Brokerage Services Ltd. at the balance sheet dates.
are translated into Korean won at the current exchange rate, shareholders’ equity at historical exchange rate and
income and expense at the weighted average exchange rate for the year. Translation gains of 415 million resulting
from the translation of financial statements of the overseas branch are credited to overseas operation translation gain
as an accumulated other comprehensive income.
21. SHAREHOLDERS’ EQUITY:
(1) Common stock
Common stock as of March 31, 2008 and 2007 is as follows (Unit: Won)

20. ASSETS AND LIABILITES DENOMINATED IN FOREIGN CURRENCIES: 2008 2007

Assets and liabilities denominated in foreign currencies as of March 31, 2008 and 2007 are as follows (Unit: Won in Number of the authorized shares 200,000,000 200,000,000
millions, Dollars in thousands): Value per share 500 500
Number of the issued common stock 60,000,000 60,000,000
2008 2007
Common stock 30,000,000,00 30,000,000,00
Currency Foreign Korean won Currency Foreign Korean won
curencies equivalent * curencies equivalent *

Cash and bank deposits USD 808 802 USD 1,536 1,444 (2) Treasury stock
EUR 169 264 EUR 62 77 Treasury stock, which the Company owns as of March 31, 2008 and 2007, is as follows (Unit: Won in millions,and
JPY 31,324 313 JPY 11,547 92 shares):
GBP 1 3 GBP 77 143
2008 2007
Trading securities USD 67,751 66,181 USD 48,895 45,976
Number of shares Book value Number of shares Book value
JPY - - JPY 395,512 3,152
Treasury stock fund 146,960 2,866 146,960 2,491
Available-for-sale securities USD 218,965 217,231 USD 325,500 305,990
Trust product 1,258,990 3,357 1,258,990 3,357
EUR 7,159 11,204 EUR 9,950 12,476
Other 4,479,100 15,492 4,479,100 15,492
Held-to-maturity securities USD 54,950 54,494 USD 107,954 101,509
5,885,050 21,715 5,885,050 21,340
Equity securities using USD 2,000 2,105 USD 2,156 2,105
the equity method

LIG INSURANCE CO., LTD.

FY07 ANNUAL REPORT Leaping Forward from 86_ 87
Good to Great

(3) Accumulated other comprehensive income 22. PREMIUM INCOME:

Changes in accumulated other comprehensive income for the year ended March 31, 2008 are as follows (Unit: Won in (1) Premium income for the year ended March 31, 2008 is as follows (Unit: Won in millions):
millions):

Beginning Changes Disposal Ending Individual Disposal Ending

Gain on valuation of available-for-sale 109,877 70,584 (7,736) 172,725 Direct premium written by the Company:
securities
General insurance 11,094 553,494 564,588
Negative changes in equity arising on (6,277) 2,078 (10) (4,209) Long-term insurance 1,938,914 591,577 2,530,491
application of the equity method
Automobile insurance 931,568 190,038 1,121,606
Loss on overseas operation translation (958) 1,373 - 415 Sub-total 2,881,576 1,335,109 4,216,685
Valuation of derivatives as a cash flow 4,068 (7,875) 103 (3,704) Assumed reinsurance premium:
hedge
General insurance - 28,167 28,167
Total 106,710 66,160 (7,643) 165,227 Sub-total - 28,167 28,167
Refund of surrender value:
*_ Pursuant to SKAS No.16 (Income Taxes), the ending balance is presented at net value, of which the accumulated other
General insurance (89) (4,456) (4,545)
comprehensive income is net of income tax (27.5%).
Automobile insurance (43,978) (8,971) (52,949)
Sub-total (44,067) (13,427) (57,494)
(4) Statements of comprehensive income Total 2,837,509 1,349,849 4,187,358
Comprehensive income consists of all changes in equity during a period from transactions and other events except
those resulting from investments by owners and distributions to owners. Comprehensive income for the years ended
March 31, 2008 and 2007 is as follows (Unit: Won in millions): (2) Premium income for the year ended March 31, 2007 is as follows (Unit: Won in millions):
2008 2007
Net income 124,695 10,056 Individual Group Total
Other comprehensive income (loss): Direct premium written by the Company:
Gain (loss) on valuation of available-for-sale securities 86,687 (10,248) General insurance 9,058 551,151 560,209
Changes in equity arising on application of the equity method 471 (178) Long-term insurance 1,834,498 394,352 2,228,850
Gain (loss) on overseas operation translation 1,373 (665) Automobile insurance 939,623 195,997 1,135,620
Gain (loss) on valuation of derivatives as a cash flow hedge (10,719) 1,560 Sub-total 2,783,179 1,141,500 3,924,679
Less: Effect of income tax (19,294) 2,389 Assumed reinsurance premium:
Comprehensive income 183,213 2,914 General insurance - 28,982 28,982
Sub-total - 28,982 28,982
Refund of surrender value:
(5) Retained earnings General insurance (201) (12,207) (12,408)
The Korean Commercial Law requires the Company to appropriate at least 10 percent of cash dividends to legal Automobile insurance (49,049) (10,231) (59,280)
reserve, until such reserve equals 50 percent of its paid-in capital. This reserve is not available for payment of cash divi- Sub-total (49,250) (22,438) (71,688)
dends; however, it can be used to reduce deficit or be transferred to capital. In addition, the Company appropriated Total 2,733,929 1,148,044 3,881,973
reserve for business rationalization and voluntary reserves according to Corporate Law.

LIG INSURANCE CO., LTD.

FY07 ANNUAL REPORT Leaping Forward from 88_ 89
Good to Great

23. OTHER OPERATING INCOME: 2007

Other operating income for the years ended March 31, 2008 and 2007 is as follows (Unit: Won in millions): Reinsurance Reinsurance Reinsurance nterest on reinsurance
premium *1 claims *2 commissions commissions

2008 2007 General insurance 344,986 119,596 57,979 3,032

Indemnity gains (213) 4,549 Long-term insurance 171,760 82,290 36,105 13,069
Gain on disposal of trading securities 7,392 2,454 Automobile insurance 32,208 30,370 2,037 -
Gain on valuation of trading securities 20,177 13,816 548,954 232,256 96,121 16,101
Gain on disposal of available-for-sale securities 18,820 56,806
*1_ Reversal of refund of surrender value ( 3,698 million) is excluded from reinsurance premium ( 552,652 million).
Reversal of impairment loss of available-for-sale_securities 2,405 501
*2_ Refund of reinsurance claims ( 1,602 million) is excluded from reinsurance claims ( 233,858 million).
Reversalof allowance for bad debts - 2,625
Gain on foreign currencies transactions 3,279 3,683
Gain on foreign exchange translation 12,130 371 25. OPERATING AND ADMINISTRATIVE EXPENSES:
Commission income 1,573 20 Operating and administrative expenses for the years ended March 31, 2008 and 2007 are as follows (Unit: Won in mil-
Dividends income 39,194 14,207 lions):
Rental revenues 11,364 12,276
2008 2007
Expenses recovered 124,898 119,371 Wages and salaries 144,360 123,582
Gain on valuation of derivatives 16 4,330 Provision for severance benefits 25,894 46,418
Gain on trading of derivatives 6,253 10,545 Other employee benefits 37,072 34,914
Miscellaneous operating revenues 2,782 4,187 General and administrative expenses 211,642 212,391
Special account revenues 232,405 178,683 Acquisition & collection 48,721 53,254
Total 482,475 428,424 Agency business commissions 185,087 197,552
Claim survey fees 59,161 49,890
Reinsurance commissions 3,889 3,590
24. REINSURANCE: Other 1,652 1,399
Reinsurance transactions as of March 31, 2008 and 2007 are as follows (Unit: Won in millions): Total 717,478 722,990

2008
Reinsurance Reinsurance Reinsurance nterest on reinsurance
premium *1 claims *2 commissions commissions 26. OTHER OPERATING EXPENSES:
Other operating expenses for the years ended March 31, 2008 and 2007 are as follows (Unit: Won in millions):
General insurance 361,786 122,779 67,596 1,845
Long-term insurance 172,544 91,184 31,656 9,286
Automobile insurance 42,548 30,475 6,595 33 2008 2007

577,878 244,438 105,847 11,164 Policyholder dividends 2,709 1,271

Amortization expenses on deferred acquisition costs (Note 14) 236,123 203,823
*1_ Reversal of refund of surrender value ( 2,398 million) is excluded from reinsurance premium 580,276 million). Interest expenses 357 356
*2_ Refund of reinsurance claims ( 1,527 million) is excluded from reinsurance claims ( 245,965 million). Loss on disposal of trading securities 12 517
Loss on valuation of trading securities 3,323 2,091
Loss on disposal of available-for-sale securities 268 176
Loss on impairment of available-for-sale securities 11,137 963
Loss on disposal of held-to-maturity securities 114 -

LIG INSURANCE CO., LTD.

FY07 ANNUAL REPORT Leaping Forward from 90_ 91
Good to Great

2008 2007 (2) The income tax on income before income tax and reconciling items
Loss on impairment of held-to-maturity securities 2,560 - The income tax on income before income tax and reconciling items for the years ended March 31, 2008 and 2007 are
Provision for possible loan losses 10,498 - as follows (Unit: Win in millions):
Loss on foreign currencies transactions 4,851 3,018 2008 2007
Loss on foreign exchange translation 796 11,783 Income before income tax ( ) 155,624 9,608
Property maintenance expenses 44,002 48,295 Burden of taxation (Current applicable rate: 27.5% 42,783 2,629
Depreciation expenses on property 3,702 3,841 Reconciliation items:
Amortization of intangible assets 5,934 6,790 Non-taxable income( 1,153 million and 16,446 million in
Loss on valuation of derivatives 14,568 581 2008 and 2007, respectively) (18,216) (5,308)
Loss on trading of derivatives 3,733 1,644 Non deductible expense( 10,844 million and 5,441 million in
Miscellaneous operating losses 243 219 2008 and 2007, respectively) 26,766 2,268
Special account expenses 232,404 178,683 Tax credits (20,414) -
Total 577,334 464,051 Additional payment (refund) of income tax - 35
Sum of reconciliation items (11,854) (3,007)
Income tax expense (benefits) ( ) 30,929 (448)
Effective tax rate ( ) 19.87% -
27. INCOME TAX EXPENSE:
(1) Income tax expense (benefits) for the year ended March 31, 2008 are as follows (Unit: Won in mil-
lions):
(3) Changes in significant cumulative temporary differences are as follows (Unit: Won in mil-
2008 2007
lions):
Income tax to be paid 29,797 35
Taxable (deductible) temporary differences Deferred income tax assets (liabilities)
Tax effect on changes in cumulative temporary differences * 20,561 (2,724)
Beginning Decrease Increase Ending Beginning Decrease Increase Ending
Tax effect on changes in loss carry forward - - balance balance balance *1 balance
Total of tax effect 50,358 (2,689)
(Deductible temporary differences)
Income taxes directly applied to shareholders’ equity (19,429) 2,241
Accrued severance benefits 96,951 9,217 18,852 106,586 26,662 2,535 5,184 29,311
Income tax expense (benefits) 30,929 (448)
Loss on valuation of securities 37,786 2,758 - 35,028 10,391 758 9,633
using equity method
*_ Tax effect on changes in cumulative temporary differences
Loss on impairment of 21,202 536 11,292 31,958 5,831 147 3,105 8,789
investment securities

2008 2007 Other liabilities 8,789 - 3,498 12,287 2,417 - 962 3,379
The ending balance of net deferred tax liabilities 81,053 59,925 Gain(loss) on valuation of (52,461) (62,626) - 10,165 (14,427) (17,222) - 2,795
derivatives
The beginning balance of net deferred tax liabilities 60,493 62,649
Change in deferred taxes liabilities due to temporary differences 20,561 (2,724) Gain on valuation of securities 2,552 1,072 5,456 6,936 702 295 1,500 1907
using equity method

Gain on disposal of 5,688 - 210 5,898 1,564 - 58 1,622

There is difference of 567 million between the ending balance of deferred taxes liabilities in 2007 amounting to available-for -sale securities
59,925 million and the beginning balance in 2008 amounting to 60,492 million due to temporary differences. It is Provision for severance benefits (71,943) (9,217) (43,860) (106,586) (19,784) (2,535) (12,062) (29,311)
recognized as the beginning balance of deferred taxes liabilities in 2008 due to the result of tax final return of 2007. Gain on valuation of trading (56,136) (56,136) (63,255) (63,255) (15,437) (15,437) (17,395) (17,395)
securities

Accrued revenues (43,372) (42,372) (45,446) (45,446) (11,652) (11,652) (12,498) (12,498)
Compensation receivable (45,187) (213) - (44,974) (12,426) (59) - (12,367)

LIG INSURANCE CO., LTD.

FY07 ANNUAL REPORT Leaping Forward from 92_ 93
Good to Great

(6) Accrued income tax and receivables of prior year’s income tax before offsetting as of March 31, 2008
Taxable (deductible) temporary differences Deferred income tax assets (liabilities)
Beginning Decrease Increase Ending Beginning Decrease Increase Ending
and 2007 are as follows (Unit: Won in millions):
balance balance balance *1 balance 2008 2007
Refund of prior year’s income tax before offsetting ￦ 22,144 ￦ 9,900
Gain on disposal of securities using ￦ - ￦ - ￦(11,750) ￦(11,750) ￦ - ￦ - ￦ (3,231) ￦ (3,231)
equity method Accrued income tax expense before offsetting 29,231 -
Refund of prior year’s income tax after offsetting - 9,900
Gain(loss) on foreign currency - - (8,962) (8,962) - - (2,465) (2,465)
translation of securities Accrued income tax after offsetting 7,087 -

Loss on foreign currency translation (5,671) - - (5,671) (1,560) - - (1,560)

of available-for-sale securities
28. DIVIDENDS:
Other 77,703 74,401 (2,203) 1,099 21,366 20,459 (606) 301 The details of dividends accounted for in the statements of appropriations of retained earnings are as follows (Unit:
Sub-total (
23,099) (
82,580) (136,168) (76,687) (6,353) (22,711) (37.448) (21,090)
Won):
Cumulative temporary differences 2008 2007
directly applied to
shareholders’ equity: Dividend per share (dividend rate) 500(100%) 125(25%)
Treasury stock (1,920) - (493) (2,413) (528) - (136) (664) Number of issued common stock (shares) 54,114,950 54,114,950
Gain on valuation of (151,554) - (86,687) (238,241) (41,677) - (23,839) (65,516) Total dividend ￦ 27,057,475,000 ￦ 6,764,368,750
available-for- sale securities
Net income ￦ 124,695,466,210 ￦ 10,055,797,013
Negative changes in equity arising on - - 5,806 5,806 - - 1,597 1,597 Dividend propensity 21.70% 67.27%
application of the equity method
Closing price at the closing day ￦ 19,500 ￦ 16,950
Gain on valuation of derivatives (5,610) - 10,719 5,109 (1,543) - 2,949 1,406 Dividend yield ratio 2.56% 0.74%
Securities using equity method *2 11,688 - - 11,688 3,214 - - 3,214
*_ As of March 31, 2008 and 2007, the shares of treasury stock possessed by the Company or trust agreement of 5,885,050 shares,
Sub-total (147,396) - (70,655) (218,051) (40,534) - (19,429) (59,963)
respectively, are excluded in calculating the dividends.
Total (170,495) (82,580) (206,823) (294,738) (46,887) (22,711) (56,877) (81,053)
Temporary difference not recognized
for deferred income tax:
29. EARNINGS PER SHARE:
Loss on valuation of securities using 37,786 37,786 - - 10,391 10,391 - - (1) Basic net income per share
equity method *2
Basic income per share is calculated for common stock by dividing net income available to common shareholders by
Securities using equity method *2 11,688 11,688 - - 3,214 3,214 - - the weighted average number of outstanding common stock. The basic net income per share is as follows (Unit: Won
Total 49,474 49,474 - - 13,605 13,605 - - in shares):
Total ￦(219,969) ￦(132,054) ￦(206,823) ￦(294,738) ￦(60,492) ￦(36,316) ￦(56,877) ￦ (81,053)
2008 2007
Net income of common stock ￦ 124,695,466,210 ￦ 10,055,797,013
*1_ The difference of retention amounting to ￦2,062 million [￦567 million of the effect of deferred income tax] in the final
Weighted average number of outstanding common shares * 54,114,950 54,114,950
income tax report for March 31, 2007 was adjusted.
Basic net income per share ￦ 2,304 ￦ 186
*2_ Deferred tax assets were recognized as the securities of LIG Life Insurance Co., Ltd. had been disposed on April 4, 2008.

The calculations of weighted average number of outstanding common shares are as follows (Unit: shares):
(4) Taxable temporary difference amounting to ￦6,222 million was not recognized as deferred income tax
liabilities because of uncertainty of disposal of land in the near future. 2008
Classification Period Days Share Weighted average number
(5) There was no carry-forward deficit as of March 31, 2008. Beginning 2007.4.1 ~ 2008.3.31 366 54,114,950 19,806,071,700
2007
Classification Period Days Share Weighted average number
Beginning 2006.4.1 ~ 2007.3.31 365 54,114,950 19,751,956,750

LIG INSURANCE CO., LTD.

FY07 ANNUAL REPORT Leaping Forward from 94_ 95
Good to Great

(2) Diluted net income per share (2) Income statements for the years ended March 31, 2008 and 2007 are as follows (Unit: Won in mil-
Diluted net income per share is the same as basic net income per share as the Company possessed no diluted securities. lions):
2008
Retirement Retirement Total
30. SPECIAL ACCOUNTS: Insurance Pension
(1) Balance sheets as of March 31, 2008 and 2007 are as follows (Unit: Won in millions): Revenue:
Premium income 199,023 15,337 214,360
2008 Interest income 17,017 1,027 18,044
Retirement Retirement Total Other revenues 3,826 803 4,629
Insurance Pension
Total 219,866 17,167 237,033
Assets: Expenses:
Cash and bank deposits 164,449 18,123 182,572 Increase in policy reserves 96,246 12,008 108,254
Securities 210,995 8,599 219,594 Insurance claims paid 119,503 4,134 123,637
Loans 37,809 - 37,809 Other expenses 4,117 1,025 5,142
Other assets 9,645 518 10,163 Total 219,866 17,167 237,033
General account receivables 3,895 2,902 6,797
Total assets 426,793 30,142 456,935
Liabilities: In addition, the Company’s transactions in the contract of dividend insurance based on retirement pension results

Policyholders reserve during FY 2007 and revenues and expenses of dividend insurance based on retirement pension results are not included
418,725 23,951 442,676
General account payables from general account income statements. Revenues and expenses of dividend insurance based on retirement pension
6,538 752 7,290
Other liabilities results amount to 4,629 million for the year ended March 31, 2008.
1,530 5,439 6,969
Total liabilities and policyholders reserve 426,793 30,142 456,935
2007
2007 Retirement Retirement Total
Retirement Total Insurance Pension
Retirement
Insurance Pension
Revenue:
Assets: Premium income 151,142 12,197 163,339
Cash and bank deposits 133,919 9,936 143,855 Interest income 13,633 188 13,821
Securities 166,199 219 166,418 Other revenues 1,514 9 1,523
Loans 13,930 - 13,930 Total 166,289 12,394 178,683
Other assets 6,221 200 6,421 Expenses:
General account receivables 2,318 1,589 3,907 Increase in policy reserves 84,132 11,731 95,863
Total assets 322,587 11,944 334,531 Insurance claims paid 79,535 636 80,171
Liabilities: Other expenses 2,622 27 2,649
Policyholders reserve 321,604 11,943 333,547 Total 166,289 12,394 178,683
Other liabilities 983 1 984
Total liabilities and policyholders reserve 322,587 11,944 334,531

LIG INSURANCE CO., LTD.

FY07 ANNUAL REPORT Leaping Forward from 96_ 97
Good to Great

31. CONTINGENCIES AND COMMITMENTS: In order to hedge against foreign exchange rate of securities denominated in foreign currency, which the Company
possesses, the Company has entered into several financial derivatives contracts and derivative instruments used for
(1) Reinsurance agreements
hedging foreign exchange rate fluctuations are accounted for as hedge accounting. Among gains or losses on valuation
The Company assumes and cedes a portion of total insurance premiums with Korean Re Co., Ltd. and the remaining
of derivatives instruments, 3,704 million (net of income tax 1,405 million) is recorded in accumulated other com-
portion is covered by foreign reinsures including Munich Re. The Company utilizes reinsurance arrangements to limit
prehensive income due to application of cash flow hedging accounting. Gains or losses on translation of foreign cur-
its maximum losses, to provide greater diversification of risks and to minimize exposures on large risks.
rency in connection with valuation of foreign securities, which are hedged, are accounted for as gains on translation of
foreign currency amounting to 11,437 million for the year ended March 31, 2008. In addition, accumulated gains or
(2) Pending litigations
losses on valuation of derivatives instruments are accounted for as derivatives assets or derivatives liabilities.
Pending litigations as of March 31, 2008 and 2007 are as follows (Unit: Won in millions):

Details of financial derivatives as of March 31, 2007 are as follows (Unit: Won in millions):
Claim amount
Status Type No. 2008 2007 Description
2007
Defendant Automobile insurance 637 51,860 65,121 Compensation claim & other
Derivatives Total Trading Hedging Total Tradingt Hedging Gain (loss) on valua- Gain(loss)
General, long-term insurance 277 33,692 36,209 Compensation claim & other instruments tion(Accumulated on valua-
914 85,552 101,330 othe-comprehensive tion(B/S)
income)
Plaintiff Automobile insurance 2,060 19,562 22,083 Claim for indemnity & other
Currency forward 179,331 - 179,331 1,333 - 1,333 - 5,715
General, long-term insurance 93 6,096 11,494 Claim for indemnity & other
Currency swaps 296,315 - 296,315 2,416 - 2,416 4,092 55,526
2,153 25,658 33,577
Interest rate swaps 10,000 - 10,000 - - - (25) (34)
Total 485,646 - 485,646 3,749 - 3,749 4,067 61,207
For above pending litigations as a defendant, the Company has reserved estimated losses as a reserve for outstanding
claims under the policy reserve account. *_ Pursuant to SKAS No.16 (Income Taxes), the ending balance is presented at net value, of which the gain on valuation of
derivatives is net of income tax ( 1,543 million).

(3) Financial derivatives

Details of financial derivatives as of March 31, 2008 are as follows (Unit: Won in millions):
(4) Securities provided as collateral
The Company has provided 70,271 million and 12,450 million of securities as collateral for the financial derivatives
2008
contracts and reinsurance agreements mentioned above, respectively. The details are as follows (Unit: Won in mil-
Derivatives Total Trading Hedging Total Tradingt Hedging Gain (loss) on valua- Gain(loss)
instruments tion(Accumulated on valua- lions):
othe-comprehensive tion(B/S)
income) Collateral amount Collateral provided to Remark
Currency forward 177,576 - 177,576 (10,593) - (10,583) - 7,822) Government and public bonds 47,471 Kookmin Bank and 2others Swap contract
Currency swaps 180,072 - 180,072 (3,895) - (3,895) (3,647) (5,989) 12,450 Nova Scotia Bank Collateral for insurance contract
Interest rate swaps 10,000 - 10,000 - - - (57) (78) Special purpose bonds 22,800 Kookmin Bank and 2 others Swap contract
Others - - - 16 16 - - 188 Total 82,721
Total 367,648 - 367,648 (14,552) 16 14,568) (3,704) (13,701)

*_ Pursuant to SKAS No.16 (Income Taxes), the ending balance is presented at net value, of which the gain on valuation of deriv- (5) Credit linked financial derivatives
atives is net of income tax ( 1,405 million). The Company purchased credit linked notes (“CLN”), credit linked deposits (“CLD”) and Synthetic CDO. The
Company assumes credit risks arising from underlying assets (corporate bonds and other securities) of the CLN, CLD
and Synthetic CDO issued whereas the Company is supposed to receive interest income at a higher interest rate than
market rate of interest prevailing at the time of purchase. As of March 31, 2008, the book values of CLN, CLD and
Synthetic CDO amount to 29,218 million, 21,100 million and 9,081 million, respectively. Additional losses may
arise from those credit risks in relation to the underlying assets of such CLN, CLD and Synthetic CDO. In addition,

LIG INSURANCE CO., LTD.

FY07 ANNUAL REPORT Leaping Forward from 98_ 99
Good to Great

CLN and Synthetic CDO are valued at fair value, which is provided by independent credit rating companies (NICE 33. RELATED PARTY TRANSACTIONS:
Pricing Services Inc. and KIS Pricing Inc.). In addition, such credit linked financial derivatives are not accounted for as
(1) Related parties of the Company as of March 31, 2008 and 2007 are as follows:
derivative instruments since they are not detachable from the underlying assets.

Ratio of ownership
(6) Overdraft agreement Company Type of shares 2008 2007
The Company has an overdraft agreement, which is renewable annually with Kookmin Bank. The maximum amounts <Affiliates>
for overdraft per-day and intra-day are 5 billion and 75 billion, respectively. LIG Life Insurance Co., Ltd. *1 A subsidiary company (domestic) 37.84% 37.84%
PT. LIG Insurance Indonesia Inc. A subsidiary company (overseas) 70.00% 70.00%
32. PREMIUM DEFICIENCY: Daum Direct Automobile A subsidiary company (domestic) 25.00% 38.16%
Insurance Co., Ltd.
(1) The objects of insurance contracts for calculating premium deficiency
Based on valid insurance contracts as of December 31, 2008, the Company included for premium deficiency (premium LIG Automobile Insurance A subsidiary company (domestic) 100.00% 100.00%
Claim Appraisal Co., Ltd.
surplus), the individual pension insurance products and long-term insurance against loss products (with dividend and
without dividend) with fixed interest rate and floating interest rate. In addition, general insurance against loss and LIG Management Services, Inc. A subsidiary company (domestic) 100.00% 100.00%
retirement insurance with less than one year insurance term were excluded. Kocref Cr-reit VII - 6.67% -
Kocref Cr-reit VIII - 6.67% 6.67%
(2) The basis of calculating premium deficiency as of March 31, 2008 is as follows Kocref Cr-reit XI - 10.00% -
Myoung Ji Dae Kyo Co., Ltd. - 2.78% -
Category Historical rate The basis of calculation <Other related parties>
Discount rate 5.38% Rate of return on assets management for recent 3 years from April 1, 2005 to NEX 1 Co., Ltd. Contribution by major shareholders 100% by LIG Holdings Corp. 100% by LIG Holdings Corp.
March 31, 2008 LIG System Co., Ltd. Contribution by major shareholders 100% by LIG Holdings Corp. 100% by LIG Holdings Corp.
Rate of operating expenses 84.05% Ratio of actual operating expenses to anticipated operating expenses for Huseco Co., Ltd. (*2) Contribution by major shareholders 100% by LIG Holdings Corp. 100% by LIG Holdings Corp.
recent 1 year from April 1, 2007 to March 31, 2008 LIG Ensulting Co., Ltd. Contribution by major shareholders 100% by LIG Holdings Corp. 100% by LIG Holdings Corp.
Rate of maintenance * - Rate of maintaining insurance contract for recent 3 years from April 1, 2005 ACE Claims Survey & Adjusting Contribution by major shareholders 100% by LIG TAS Claims 100% by LIG Huseco Co., Ltd.
Co., Ltd. Survey & Adjusting Co., Ltd.
to March 31, 2008
Rate of claim payment 73.40% Ratio of claim payment to the anticipated risk of the insurer for recent 3 Serbig Co., Ltd. Contribution by major shareholders 100% by Huseco Co., Ltd. -
years from April 1, 2005 to March 31, 2008 LIG TAS Claims Survey & Contribution by major shareholders 100% by related parties -
Adjusting Co., Ltd. (Goo, Bon Sang)
*_ The rate of maintenance is calculated using the rate of maintenance of each series of products after subdividing similar
TAS Automobile Insurance Contribution by major shareholders 90% by related parties 100% by related parties
insurance products.
Claim Appraisal Co., Ltd. (Goo, Bon Sang) (Goo, Bon Sang)

LIG Holdings Corp. Contribution by major shareholders 100% by related parties 100% by related parties
(3) The calculation and accounting principle of reserve for claims by type of insurance contract, anticipated interest (Goo, Bon Sang) (Goo, Bon Sang)
rate and premium deficiency (premium surplus) as of March 31, 2008 are summarized as follows (Unit: Won bi
Lshop Co., Ltd. Contribution by major shareholders 100% by related parties -
llions): (Goo, Bon Sang)

Category Reserve for claims 9.49 mmAnticipated interest rate * Premium deficiency (surplus) LIG E&C Co., Ltd. Contribution by major shareholders 89.28% by TAS Automobile 89.28% by TAS Automobile
Insurance Claim Appraisal Insurance Claim Appraisal
Long-term with dividend 24 6.50% 2 Co., Ltd. Co., Ltd.
Long-term without dividend 29,990 3.5~8.0% (6,063) LIG E&C PFV I Co., Ltd. Contribution by major shareholders 95% by LIG E&C Co., Ltd. -
Individual pension 6,977 3.5~7.5% (83) LIG PHILKO, INC Contribution by major shareholders 40% by related parties -
(Goo, Bon Sang)
Total 36,991 3.5~8.0% (6,144)
LIG Neoptek Co., Ltd. Contribution by major shareholders 100% by related parties -
*_ The anticipated interest rate is based on guaranteed portion. (Goo, Bon Sang)

Powell Water Korea Co., Ltd. Contribution by major shareholders 51% by LIG Ensulting Co., Ltd. -

LIG INSURANCE CO., LTD.

FY07 ANNUAL REPORT Leaping Forward from 100_ 101
Good to Great

*1_ LIG Life Insurance Co., Ltd. changed its name to Woori Aviva Co., Ltd. on April 1, 2008. 2008
*2_ FMS Co., Ltd. changed its name to Huseco Co., Ltd. on May 1, 2007.
Company Operating Operating Receivables Payables
revenues expenses

Affiliates
(2) Significant transactions and balances with related parties for the years ended and as of March 31, 2008 LIG Life Insurance Co., Ltd. ￦ 246 ￦ 3,617 ￦ 531 ￦ 440
and 2007 are as follows (Unit: Won in millions): PT. LIG Insurance Indonesia Inc. 431 459 116 295
Daum Direct Automobile Insurance Co., Ltd. 453 5,189 - 6,108
LIG Automobile Insurance Claim Appraisal Co., Ltd. 1,008 11,910 - 999
2008
LIG Management Services, Inc. - 3,511 - 162
Company Operating Operating Receivables Payables
revenues expenses Other related parties
NEX 1 Co., Ltd. 451 2 - -
Affiliates
￦
LIG System Co., Ltd. 26 7,749 - 84
LIG Life Insurance Co., Ltd. ￦ 276 327 ￦ 504 ￦ 412
Huseco Co., Ltd. 454 25,395 - 3,678
PT. LIG Insurance Indonesia Inc. 859 625 82 23
LIG Ensulting Co., Ltd. 47 4,647 - 545
Daum Direct Automobile Insurance Co., Ltd. 407 262 - 6,116
ACE Claims Survey & Adjusting Co., Ltd 670 11,031 - 885
LIG Automobile Insurance Claim Appraisal Co., Ltd. 31 - - -
TAS Automobile Insurance Claim Appraisal Adjusting Co., Ltd. 259 35,484 - 3,131
LIG Management Services, Inc. - 6,466 - 11
LIG Holdings Corp. 2,312 391 - -
Other related parties
LIG E&C Co., Ltd - - - 10
NEX 1 Co., Ltd. 540 - - -
Total ￦ 6,357 ￦ 109,385 ￦ 647 ￦ 16,337
LIG System Co., Ltd. 52 9,189 - 84
Huseco Co., Ltd. 397 24,775 - 3,883
LIG Ensulting Co., Ltd. 53 4,463 - -
(3) The major management compensations for the years ended March 31, 2008 and 2007 are as follows
ACE Claims Survey & Adjusting Co., Ltd 723 12,342 - 1,031
Serbig Co., Ltd. - 2,065 - 189
(Unit: Won in millions):
LIG TAS Claims Survey & Adjusting Co., Ltd. 465 35,770 - 2,932
2008
TAS Automobile Insurance Claim Appraisal Adjusting Co., Ltd. 80 6,041 - -
Classification Short-term Employ benefits Total
LIG Holdings Corp. 52 - 1 - employee benefits after resignation
Lshop Co., Ltd. 13 5,600 - 627 ￦ ￦ ￦
Registered executive 6,914 1,189 8,103
LIG E&C Co., Ltd 220 - 23 10
Non-registered executive 4,196 963 5,159
Total ￦ 4,168 ￦ 107,925 ￦ 610 ￦ 15,318
Total ￦ 11,110 ￦ 2,152 ￦ 13,262

2007
Classification Short-term Employ benefits Total
employee benefits after resignation

Registered executive ￦ 3,927 ￦ 2,375 ￦ 6,302

Non-registered executive 4,003 812 4,815
Total ￦ 7,930 ￦ 3,187 ￦ 11,117

LIG INSURANCE CO., LTD.

FY07 ANNUAL REPORT Leaping Forward from 102_ 103
Good to Great

34. EMPLOYEES’ WELFARE AND DONATIONS: 36. MAJOR OPERATING ACHIVEMENT:

(1) Supporting educational expenses Major operating achievements for the period from January 1, 2008 to March 31, 2008 and from January 1, 2007 to
In order to mitigate the burden of the educational expenses of employees’ children, the Company supports portion of March 31, 2007 (unaudited) are as follows (Unit: Won in millions):
tuition of pre-school and entrance fee and tuition of middle school to college. 2008 2007
Operating revenue 1,273,262 1,209,253
(2) Medical examination Operating income 9,440 12,865
The Company annually provides a regular medical examination service for its employees. Net income 26,174 15,150
Net income per share 484 280
(3) Others
The Company maintains paid-vacation system, such as congratulations and condolences vacation, long service vaca-
tions and vacation for heath training. 37. CAHFLOW STATEMENTS:
(1) As presented in the accompanying statements of cash flows, cash and equivalents as of March 31, 2008
(4) Donation to the public and 2007 consist of the following (Unit: Won in millions):
The Company donated to college development funds amounting to 731 million and 676 million for the years ended 2008 2007
March 31, 2008 and 2007, respectively. Cash 3 3
Checking accounts 257 254
35. VALUE-ADDED: Passbook accounts 15,658 11,781
Information needed for calculation of value-added for the years ended March 31, 2008 and 2007 are as follows (Unit: Deposits in foreign currencies 1,382 1,757
Won in millions): Deposits in overseas countries 3,773 3,329

2008 Other 45,092 50,710

Classification Operating Property Depreciation Total 66,165 67,834
expenses aintenance expenses on
expenses property
Salaries 144,360 2,656 - 147,016
(2) Significant transactions not involving cash inflows and outflows for the years ended March 31, 2008
Employee benefits 37,072 476 - 37,548
and 2007 are as follows (Unit: Won in millions):
Rental expenses 29,650 24 - 29,674
Taxes and dues 22,685 12,662 - 35,347 2008 2007
Depreciation 20,423 97 3,702 24,222 Gain on valuation of available-for sale securities 86,687 2,669
Provision for severance benefits 25,894 377 - 26,271 Gain on valuation of derivative instruments 6,538 2,419
Total 280,084 16,292 3,702 300,078 Decrease in investment securities 14,784 219
Loss on overseas operation translation 2,324 1,102
2007
Classification Operating Property Depreciation Total
expenses aintenance expenses on
expenses property
Salaries 123,582 2,905 - 126,487
Employee benefits 34,914 504 - 35,418
Rental expenses 31,689 35 - 31,724
Taxes and dues 23,263 11,023 - 34,286
Depreciation 19,400 7,087 3,841 30,328
Provision for severance benefits 46,418 600 - 47,018
Total 279,266 22,154 3,841 305,261

LIG INSURANCE CO., LTD.

FY07 ANNUAL REPORT Leaping Forward from 104_ 105
Good to Great

INDEPENDENT ACCOUNTANT’S REVIEW FY07

REPORT ON INTERNAL ACCOUNTING ANNUAL REPORT
CONTROL SYSTEM (“IACS”) LEAPING FORWARD FROM
English Translation of a Report Originally Issued in Korean
GOOD TO GREAT
To the Shareholders and Board of Directors of LIG Insurance Co., Ltd.:

We have reviewed the accompanying Report on the Management’s Assessment of IACS (the “Management’s Report”)
of LIG Insurance Co., Ltd (the “Company”) as of March 31, 2008. The Management’s Report, and the design and
operation of IACS are the responsibility of the Company’s management. Our responsibility is to review the
Management’s Report and issue a review report based on our procedures. The Company’s management stated in the
accompanying Management’s Report that “based on the assessment of the IACS as of March 31, 2008, the Company’s
IACS has been appropriately designed and is operating effectively as of March 31, 2008, in all material respects, in
accordance with the IACS Framework established by the Korea Listed Companies Association.”

We conducted our review in accordance with the IACS Review Standards established by the Korean Institute of
Certified Public Accountants. Those standards require that we plan and perform a review, objective of which is to
obtain a lower level of assurance than an audit, of the Management’s Report in all material respects. A review includes
obtaining an understanding of the Company’s IACS and making inquiries regarding the Management’s Report and,
when deemed necessary, performing a limited inspection of underlying documents and other limited procedures.

The Company’s IACS represents internal accounting policies and a system to manage and operate such policies to
provide reasonable assurance regarding the reliability of financial statements prepared, in accordance with accounting
principles generally accepted in the Republic of Korea, for the purpose of preparing and disclosing reliable accounting
information. Because of its inherent limitations, IACS may not prevent or detect a material misstatement of the
financial statements. Also, projections of any evaluation of effectiveness of IACS to future periods are subject to the
risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the
policies or procedures may deteriorate.

Based on our review, nothing has come to our attention that causes us to believe that the Management’s Report
referred to above is not fairly stated, in all material respects, in accordance with the IACS Framework established by
the Korea Listed Companies Association.

Our review is based on the Company’s IACS as of March 31, 2008, and we did not review its IACS subsequent to
March 31, 2008. This report has been prepared pursuant to the Acts on External Audit for Stock Companies in the
Republic of Korea and may not be appropriate for other purposes or for other users.

May 21, 2008

LIG INSURANCE CO., LTD.

FY07 ANNUAL REPORT Leaping Forward from 106_ 107
Good to Great

Company History


July 24, 1987
November 1, 1999
Spun off from the LG Group.
“Hit Product”
September 26, 2003
April 13, 2006
Launched LIG-Yongjoo Kim Pro-Golf
Acquisition of GQM Certification for
Daejeon Customer Call Center

Opened New York liaison office.
June 21, 1988
Renamed as Lucky Insurance Co., Ltd.
October 31, 1988
Opened Tokyo liaison office.
September 1989
Ranked as the top property & casualty
insurer in terms of management perfor-
mance for three years in a row.

Opened Shanghai liaison office
January 27, 2004
Dedicated LG Insurance Ingenium
January 17, 2000
May 7, 2004
Acquired Lucky Life Insurance Co., Ltd.
First anniversary of CS (Customer
January 25, 2000
Satisfaction)-Top & Vision 2010
Merged with Lucky Automobile
July 8, 2004
Insurance Claim Adjustment Co., Ltd.
Began sales of well-being insurance
January 27, 2000
October 19, 2004
Adopted a new vision & CI(Corporate
"Magiccar" Auto Insurance awarded
May 15, 2006 July 9, 2007
Completion of the Second L-Flower Awarded Gold Prize for the Best Korean
“House of Hope” Electronic Finance Service and System
June 30, 2006
Provider at the 7th Korean e-Finance
LIG Dream Grand Festival
Awards Ceremony
August 25, 2006
October 22, 2007
Opening of LIG Art Hall
Selected Number One in the Category of
September 1, 2006
Consumer Appraisal for Automobile
LIG Broadcasting System (LBS)
Insurance “Twice the Happiness
December 5, 2006
Chachacha (Car Car Car)” by the


Identity) for the new millennium. Awarded Grand Prize for Innovative
grand prize in "Brand of the Year" Insurance Consumer Federation
July 2000 Management
November 1, 2004 December 11, 2007
LG Insurance Mall selected as an excel- December 13, 2006
April 5, 1990 LG Insurance announced Completion of the Fifth L-Flower
lent website by Naeway Economic Daily. Completion of the Third L-Flower
Opened U.S. Branch. new ethics code “House of Hope”


September 16, 2000 “House of Hope”
May 9, 1992 January 26, 2005
Acquired A- (Excellent) rating from A.M. December 28, 2006
Signed an agreement for cooperative rela- LG Insurance/Magiccar selected as grand
Best of the U. S. for third consecutive Mr. Woo-Jin Kim Named President and
1959_ Pan Korea Insurance Building tions with Royal & Sun Alliance Group prize in 2005 First Brand
January 21, 2008
year. Chief Executive Officer of LIG (Non-
Plc, U.K. January 27, 2005
The 6th LIG Insurance Children’s
October 24, 2000 Life) Insurance Company Limited
April 1995 Launched “Greaters” volleyball team


Economics Camp
Won Naekyeong (the Naeway Economic
Accorded AA Grade in management May 1, 2005
January 31, 2008
Daily)’s Insurance Grand Prize.
assessment by the Insurance Supervisory Launched a new brand, “L-Flower”, for
Delivered LIG Insurance Hope
December 20, 2000
Board. long-term insurance April 1, 2007 “KoKoMa” Fund
Selected as the first-prize winner in NCSI
June 1, 1995 September 30, 2005 The 5th LIG Insurance-Korea Open April 1, 2008
(National Customer Satisfaction Index).
Renamed LG Insurance Co., Ltd. Total assets reached 5 trillion won Marathon


Released a Brand New Product “LIG
April 23, 1996
Opened Beijing liaison office.  April 3, 2007
Mr. Ki-Won Park Named New Coach
Happy Plus ChaChaCha (Car Car Car)”
Automobile Insurance


September 2, 1996 May 2001 January 2, 2006 for LIG-Greaters Volleyball Team April 11, 2008
Opened website on the Internet. Established Special Investigation Completion of the First L-Flower April 17, 2007 Held Gold Member Awards Ceremony
October 21, 1997 Unit(SIU) for insurance fraud for the “House of Hope” Ratification of Investment Intent May 27, 2008
January 27, 1959
Won the Insurance Grand Prize for ser- first time in the industry. February 7, 2006 Contract with Nanjing, China Completion of the Sixth
Pan Korea Insurance Co., Ltd.
vice from Naekyeong (Naeway Economic October 11, 2002 Won the first CEO Grandprix award - May 3, 2007 “House of Hope” in Gumi,
established.
Daily). Acquired A - (Excellent) rating from LIG Insurance Hope Bazaar


finance North Gyeongsang Province
September 30, 1997 A.M. Best February 22, 2006 May 3, 2007 (Gyeonsangbuk-do)
Established LG SIMAS Insurance, a joint November 13, 2002 Won the 2005 First Brand Award: Ground-Breaking Ceremony for LIG
April 3, 1970 venture in Indonesia. Customer Satisfaction Top Prize awarded L-Flower (Long term insurance competi- Insurance In-Service Education Institute
Shares of Pan Korea acquired by May 28, 1998 for “Innovative Customer Service” by the tion) in Sacheon, South Gyeongsang Province
the Lucky-Gold Star Group. Awarded the highest grade, AA, in its KMA consultant Inc. April 1, 2006 (Gyeongsangnam-do)
June 23, 1976 management evaluation from Insurance May 6, 2003 Changed company name to May 31, 2007
Initial public offering. Supervisory Board. Vision 2010 Launched LIG Insurance Completion of the Fourth L-Flower
May 15, 1978 November 1998 May 30, 2003 April 3, 2006 “House of Hope”
Opened London liaison office. Opened Customer Service Center. “Magiccar” Auto Insurance selected as Proclamation of CI July 4, 2007
FY07 ANNUAL REPORT

Organization Chart Corporate Directory

Board of Directors

Chairman

Vice Chairman & CEO President & CEO Compliance Officer

Chief Actuary
Standing Auditor

MANAGEMENT SUPPORT Management Planning

Human Resources & General Affairs
Financial Department
Long Term Insurance
Customer Support
Public Relations
IT

AUTO INSURANCE & CLAIMS Auto Insurance

Claims
CORPORATE MARKETING Corporate Marketing
Corporate Marketing 1
Corporate Marketing 2
Affiliates
New Channels
Bancassurance
Comercial Insurance
INDIVIDUAL MARKETING Individual Marketing
Gangbuk Headquarter
Gangnam Headquarter
GyeonginGangwon Headquarter
Busan Headquarter
Daegu Headquarter
Chungcheong Headquarter
Honam Headquarter
RFC Headquarter
International Operations
Leading Insurance Services, Inc.
Mr. Jong Uk Lee
Mr. D.S KANG
14th Floor, 400 Kelby Street,
Fort Lee, NJ 07024, U.S.A.
Tel: +1-201-720-2100
Fax: +1-201-720-2119
E-mail: julee59@lig.co.kr
United States Branch
Mr. D.S KANG
14th Floor, 400 Kelby Street
Fort Lee, NJ 07024, U.S.A.
Tel: +1-201-720-2102
Fax: +1-201-720-2119
E-mail: battenhchoi@lig.co.kr
Los Angeles Liaison Office
Mr. S. K. PARK
505 North Brand Boulevard, Suite
1025
Glendale, CA 91203, U. S. A.
Tel: +1-818-254-1040
Fax: +1-818-254-1039
E-mail: sean@lig.co.kr
Tokyo Liaison Office
Mr. K. H. Han
Higashi-Kan 16F, Akasaka Twin-
Tower 17-22, 2-Chome, Akasaka,
Minato-ku, Tokyo 107- 8470, JAPAN
Tel: +81-3-3585-9501
Fax: +81-3-3585-9502
E-mail: khan2000@lig.co.kr
Hanoi Liaison Office
Mr. H. T. Do
Rm. 801, Hanoi Tung Shing Square,
2 Ngo Quyen St., Hanoi, Vietnam
Tel: +84-4-935-0814~5
Fax: +84-4-935-0813
E-mail: nirvana@lig.co.kr
Ho Chi Minh Liaison Office
Mr. H. T. Do
Rm. 809 Sun Hwa Tower, 115,
Nguyen Hue BLVD. Dist. 1,
Ho Chi Minh City, Vietnam
Tel: +84-8-821-9968~9
Fax: +84-8-821-9967
E-mail: nirvana@lig.co.kr
Beijing Liaison Office
Mr. S. Y. Lee
Mr. D. W. Ha
Room 03, EF Floor, West Tower,
Twin Towers, B-12 Jianguomenwai
Avenue, Chaoyang District, Beijing,
100022 P. R. China
Tel: +86-10-6563-2390/2391
Fax: +86-10-5109-6018
E-mail: xiady@lig.co.kr
Shanghai Liaison Office
Ms. J. E. Lee
Pu Fa Tower 17F-C, 588 Pudong South
Road,
Pudong New District, Shanghai 200120,
P.R. China
Tel: +86-21-5840-6489 / 6478
Fax: +86-21-5876-0337
E-mail: jelee@lig.co.kr
PT. LIG Insurance Indonesia
Mr. S. K. CHO
Mr. C. H. LIM
BII Plaza Tower II, 25 Fl., Suite 2501
JI. M. H. Thamrin No. 51,
Jakarta 10350, Indonesia
Tel: +62-21-391-3101
Fax: +62-21-391-3115
E-mail: licjchl@lig.co.kr