GROUPAMA / 2020 UNIVERSAL REGISTRATION DOCUMENT

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

Life and health insurance in France (in millions of euros)

31.12.2019

31.12.2020

2020-2019 change

Gross earned premiums

4,694

100.0% 4,867

100.0%

173

3.7%

Underwriting expenses (policy servicing) – excluding claims management costs

(3,643)

-77.6% (3,976)

-81.7% (333)

-9.2%

Reinsurance balance

(14)

-0.3%

(27)

-0.6%

(13)

-94.9%

Underwriting margin net of reinsurance

1,037

22.1% 863

17.7% (174)

-16.8%

Net expenses from current underwriting operations

(947)

-20.2% (968)

-19.9%

(20)

-2.1%

Underwriting income net of reinsurance

90

1.9% (105)

-2.1% (194)

<-100%

Recurring financial margin net of profit sharing and tax

128

2.7%

182

3.7%

54

42.4%

Other items

(31)

-0.7%

19

0.4%

50

>100%

Economic operating income

186

4.0%

96

2.0% (90)

-48.4%

Capital gains realised net of corporate income tax and profit sharing Allocations to reserves for long-term impairment net of corporate income tax and profit sharing Gains or losses on financial assets recognised at fair value net of corporate income tax and profit sharing

245

5.2%

82

1.7% (163)

-66.6%

(65)

-1.4%

(8)

-0.2%

58

88.2%

(8)

-0.2%

15

0.3%

23

>100%

Other operations net of corporate income tax

1

0.0%

(39)

-0.8%

(40)

<-100%

GROUP NET INCOME

359

7.6% 146

3.0% (213)

-59.4%

Operating expenses increased in part due to increased commissions related to successful commercial operations. The net underwriting income from life and health insurance of Groupama Assurances Mutuelles was down €35 million over the period. Recurring financial margin (net of profit sharing and tax) increased €54 millionover the period. The decrease in financial income was more than offset by a lower net profit-sharing expense at Groupama Gan Vie. In France, net income from life and health insurance amounted to €146 million at 31 December2020 comparedwith €359 millionat 31 December2019. The non-recurringfinancial margin decreased by €82 millionover the period, mainly due to lower realised gains. Other transactionsnet of taxes amountedto -€39 millionmainly in connection with the decrease in the deferred tax rate and the contribution to the Covid-19 fund.

Underwriting income net of reinsurancedecreasedby €194 million at 31 December 2020 mainly due to the health crisis. Groupama Gan Vie’s net underwriting income declined by €168 million over the period in line with the decrease in the net underwriting margin (-€146 million) and the increase in operating expenses by 21 million. This decrease is explained by the deterioration of the current margin during the health crisis and by the increase in the prudential provision expense taking into account the financial environment. In Group insurance, the current underwriting margin fell sharply. The protection and health insurance segments were heavily impacted by the health crisis with premium income down and benefits up (work stoppageand death). In individual insurance, the current underwriting margin was almost stable.

126

Universal Registration Document 2020 - GROUPAMA ASSURANCES MUTUELLES