- Brazil's economy contracted significantly in 2015 and is expected to further contract in 2016, plagued by low commodity prices, political crisis, and scandals. The economy is unlikely to rebound without reforms, but politics have stalled reforms. - The property and casualty insurance market in Brazil grew consistently from 2012-2015 despite economic contraction. However, growth is expected to slow to 11.4% in 2016. Competition and capacity continue to increase while loss ratios have deteriorated. - Human resources will be key to improving financial results, productivity, and innovation for insurance companies in Brazil according to the document.

1. O Panorama do Resseguro no Brasil
April/2016

2. 2
WHERE WE ARE – MARKET (ECONOMICS)
Brazil Macroeconomic Scenario
 Brazil´s economy is expected to record the largest contraction in over a decade in 2015, plagued by
depressed private consumption and low prices for commodities, in addition to the political crisis
and scandals in stated-owned companies (such as Petrobras). Further contraction is anticipated to
occur in 2016 by some commentators.
 The economy is unlikely to see a significant rebound without economic reforms however political
wrangling is stalling the government’s attempts at reform. President Dilma Rousseff’s approval
ratings have fallen to all-time lows and she is facing a large amount of opposition in Congress,
which has watered down a number of austerity measures. As a result of the large challenges to
fiscal consolidation, poor growth prospects and the government’s rising debt burden, Fitch Ratings
downgraded Brazil to BBB- from BBB, one notch above junk bond status in October. Standard &
Poor's downgraded Brazil's credit rating to junk grade in the end of August.

3. 3
P&C – Insurance Market
Regulatory
Environment
R/I Insurers
Alignment: Mission / Vision / Core Values
• Optimization of
rules Protection
X Control X
Productivity
• Investments
needed to develop
a leadership Local
Market
• Get niched, get big or
get out
The success of a P&C strategy is based on long term relationships and the right balance of
results among the stakeholders who participate in the insurance chain
Stablish a steady company capable to consistently delivery combined ratios bellow 100%
Brokers
• More sophisticated
buyers

4. 4
MARKET TRENDS
Our internal P&C multiline Market Proxy shows a consistent market growth in spite of a
GDP contraction
• New entrants
• More verticalization
• Consolidation. Valuations of P&C companies affected by
the macroeconomic environment
• Continue Pressure on rates
• Deterioration of technical results
• Risk Selection Approach
GWP Mkts GWP Mkts GWP Mkts GWP Mkts
ACE 2.266.861.385 24,07% 2.614.659.213 23,84% 2.053.845.019 17,50% 1.772.784.372 14,92%
Mapfre 998.671.535 10,61% 1.172.962.072 10,70% 1.496.707.237 12,76% 1.563.330.713 13,16%
Tokio Marine 487.314.865 5,18% 524.274.417 4,78% 672.320.876 5,73% 884.753.785 7,45%
Yasuda 523.104.394 5,56% 642.085.414 5,85% 713.959.912 6,08% 702.525.792 5,91%
Allianz 941.545.328 10,00% 951.478.909 8,68% 970.730.286 8,27% 617.209.467 5,20%
Porto 411.767.480 4,37% 436.186.918 3,98% 481.652.697 4,10% 585.855.130 4,93%
Zurich 430.748.751 4,57% 571.873.815 5,21% 607.358.973 5,18% 566.359.509 4,77%
Bradesco 474.630.891 5,04% 387.861.304 3,54% 547.325.432 4,66% 539.562.030 4,54%
AIG 170.978.812 1,82% 212.260.320 1,94% 295.181.307 2,52% 381.569.781 3,21%
Fairfax 182.175.902 1,93% 244.866.570 2,23% 316.149.096 2,69% 349.611.696 2,94%
Liberty 257.664.945 2,74% 259.282.024 2,36% 291.465.441 2,48% 214.775.206 1,81%
Other 3.624.319.252 38,49% 4.336.428.170 39,54% 4.739.688.357 40,39% 3.700.131.413 31,15%
Market 9.416.470.732 10.966.553.319 16,46% 11.734.001.649 7,00% 11.878.468.894 1,23%
Jan. 2012 - Dec. 2012 Jan. 2013 - Dec. 2013 Jan. 2014 - Dec. 2014 Jan. 2015 - Dec. 2015

5. 5,9% 4,5%
0,2%
9,0%
16,3%
5,0%
10,5%
22,2%
4,5%
18,0%
13,2%
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
5
WHERE WE ARE – MARKET (P&C)
The P&C Market is expected to grown in 2016 at a slower pace of 11,4%, retained and
ceded loss rations have deteriorated and competition and capacity continue to increase
• 30 Insurance Companies operating in P&C Business
• 119 Reinsurers accredited in Brazil
• New top international insurers entering in the P&C
Market
• Companies aggressively defending their portfolio to
justify acquisition costs
• Local Reinsurers overall operating with combined
ratios above 100%
• Global capacities being accessed
Key P&C Market Facts
P&C Underwriting Cycle

6. 6
HUMAN RESOURCES
Human Resources will be key to turnaround results, increase productivity and innovation