GROUPAMA / 2018 Registration document

RISK FACTORS AND RISK MANAGEMENT RISK MANAGEMENT AND SENSITIVITY ANALYSES

5.2.5

RISK OF REINSURER INSOLVENCY

Outward reinsurance consists of transferring to the reinsurer a portion of the risks accepted by the ceding company. They are regularly reviewed to monitor and limit the credit risk on third-party reinsurers. The reinsurance securities committee examines and approves the list of reinsurers accepted for all external outward reinsurance. This list is reviewed in its entirety at least twice a year. During the year, continualmonitoring isperformedto adapt the internal ratings of the reinsurers to changes that may occur to them that would modify their solvency assessment. For any given reinsurance

placement, any reinsurer approached for an outward reinsurance outside Groupama must first be on the list of the Group Security Committee. Approved reinsurers must have a rating compatible with the type of business reinsured, depending on whether they have a short or long accountingrun-off. Transferred insurance technical reserves and recoverables are shown below, by rating, according to the three largest rating agencies (Standard & Poor’s, FitchRatings,Moody’s).

31.12.2018

AAA

AA

A

BBB

< BBB Not rated

Total

(in millions of euros)

Shareof reinsurers in non-lifeinsurance reserves

908

75

6

434

1,423

Shareof reinsurers in life insurance reserves

12

17

36

65

Shareof reinsurers in reservesfor financialcontracts withdiscretionary profit sharing Shareof reinsurers in reservesfor financialcontracts withoutdiscretionary profit sharing Receivables fromoutwardreinsurance operations

5

42

5

123

171

TOTAL

962

97

6

593

1,658

31.12.2017

AAA

AA

A

BBB

< BBB Not rated

Total

(in millions of euros)

Share of reinsurers in non-lifeinsurance reserves

978

110

6

1

459

1,554

Shareof reinsurers in life insurance reserves

18

28

34

80

Shareof reinsurers in reservesfor financialcontracts withdiscretionary profit sharing Shareof reinsurers in reservesfor financialcontracts withoutdiscretionary profit sharing Receivables fromoutwardreinsurance operations

52

4

1

1

126

183

TOTAL

1,048

142

7

1

619

1,817

The total share of unrated reinsurers corresponds primarily to outward reinsurance to professional reinsurance pools, especially Assurpol, Assuratome, Gareat, and Réunion Aérienne, which are not subject to any rating. A share of €337 million (€278 million for fiscal year 2017) is also represented by the Groupama Assurances Mutuelles retrocession

to the regional mutuals under the Internal Reinsuranceagreement. The breakdown is asfollows: €333 millionin share ofreinsurers in non-lifeinsurance reserves; ❯ €3 million in receivables from outward reinsurance operations. ❯

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REGISTRATION DOCUMENT 2018 - GROUPAMA ASSURANCES MUTUELLES