GROUPAMA / 2019 Universal Registration Document

6 EARNINGS AND FINANCIAL POSITION Management report of the Board of Directors

In life and health insurance, economic operatingincomein France was €186 million in 2019 compared with €128 million in 2018.

Life and health insurance in France (in millionsof euros)

31.12.2018

31.12.2019

2019-2018 change

Gross earned premiums

4,588

100.0% 4,694

100.0%

106

2.3%

Underwritingexpenses(policy servicing) –excluding claimsmanagementcosts

(3,575)

-77.9% (3,643)

-77.6%

(68)

-1.9%

Reinsurancebalance

(23)

-0.5%

(14)

-0.3%

9

39.7%

Underwritingmarginnet of reinsurance

989

21.6% 1,037

22.1%

48

4.9%

Net expensesfrom current underwritingoperations

(913)

-19.9% (947)

-20.2%

(35)

-3.8%

Underwritingincomenet of reinsurance

77

1.7%

90

1.9%

13

17.2%

Recurringfinancialmargin net of profit sharing and tax

80

1.7%

128

2.7%

48

60.7%

Other items

(28)

-0.6%

(31)

-0.7%

(3)

-11.7%

Economicoperatingincome

128

2.8% 186

4.0%

58

45.5%

Capital gains realisednet of corporate income tax and profitsharing Allocationsto reservesfor long-term impairment net of corporateincome tax and profit sharing Gains or losses on financialassets recognisedat fair value net of corporate income tax and profit sharing

154

3.4%

245

5.2%

91

59.0%

(1)

0.0%

(65)

-1.4%

(64)

<-100%

(4)

-0.1%

(8)

-0.2%

(4)

<-100%

Other operationsnet of corporate income tax

(21)

-0.5%

1

0.0%

22

>100%

GROUPNET INCOME

256

5.6% 359

7.6% 103

40.2%

Underwritingincomenet of reinsuranceimprovedby +€13 millionin 2019. Groupama Gan Vie’s net underwriting income decreased by -€6 million over the period, in line with the increase in the net underwriting margin (+€12 million) and the increase in operating expensesby -€19 million. In individual insurance, the current underwritingmargin decreased by -€17 milliondue to managementcharges on the L441 pension plans and decreased underwriting results in savings, health, and protection. In group insurance, the current underwriting margin was up +€13 million due to the increase in markups on health and protection premiums and an increase in surpluses. However, the year was marked by a few technically loss-making contracts, the mostsignificant of which was terminated in early 2020.

Operating expenses were up with the increase in commissions related to the developmentof the businessand the considerationof expensesassociated with majorprojects. The technical net income of life and health insurance of the entity Groupama Assurances Mutuelles increased slightlyover the period. Recurringfinancialmargin (net of profit sharingand taxes) increased +€48 million over theperiod. In France, net income from life and health insurance amounted to +€359 millionat 31 December2019 compared with +€256 million at 31 December2018. The non-recurringfinancialmargin increased by €23 millionover the period, due to realised capital gains related in particular to the sale of a property in Paris, partially offset by an increase in mutual fund impairmentsfollowing a change in holding strategy. As a reminder, non-recurring items amounted to -€21 million in 2018, explained in particular by the decrease in the corporate tax rate.

120

Universal Registration Document 2019 - GROUPAMA ASSURANCES MUTUELLES