Groupama // 2021 Universal Registration Document

3 CORPORATE GOVERNANCE AND INTERNAL CONTROL Major contracts

3.6.2

REINSURANCE AGREEMENT

retrocession to the regional mutuals by Groupama Assurances ❯ Mutuelles of a portion of the general profit/loss from its inward reinsurance business, which reduces the need for reinsurance outside the Group and involves all the mutuals in balancing the outward reinsurance business with Groupama Assurances Mutuelles. Any modification of the structuring parameters of the reinsurance agreement and its appendices must be the subject of a written amendment approved by the regional mutuals and Groupama Assurances Mutuelles according to the following procedure: proposed amendments are drafted by a reinsurance working ❯ group made up of representatives of Groupama Assurances Mutuelles and the regional mutuals; subject to the approval of the Chief Executive Officer of ❯ Groupama Assurances Mutuelles, they are submitted for the agreement of the Chief Executive Officers of the regional mutuals; lastly, they are presented by the Groupama Assurances ❯ Mutuelles Chief Executive Officer to the meeting of the Groupama Assurances Mutuelles Board of Directors, which is as asked to approve the proposed amendments by a simple majority vote, after seeking the recommendations of the Audit and Risk Management Committee. The amendments made to the reinsurance agreement in recent decades were prompted by two factors: changes in the structure of the mutuals (successive ❯ combinations, opening up the membership and takeover of the non-agricultural risk portfolio previously managed by the subsidiary SAMDA) that changed their size and therefore their holding capacity; certain risk categories (major weather-related events, imbalance ❯ in industrial risks, etc.) required greater empowerment of the mutuals in terms of underwriting control and the costs of claims by increasing their holdings in those areas. In summary: the reinsurance agreement covers all the risks underwritten by ❯ the regional mutuals; in order to take account of their specific characteristics in terms of protection needs, all the risks are classified in such a way as to differentiate between the solutions provided through reinsurance; the reinsurance agreement is a coherent and balanced whole ❯ that must be assessed in terms of its intended purpose and overall effects and not by isolating any one of its components from this context; in any event, this approach of placing the agreement in perspective is not opposed to a segmented, technical attitude to risks and to the reinsurance terms associated with them; the Internal Reinsurance terms currently applicable are the result ❯ of amendments made over time to make this system fully effective in terms of its economic purpose of offsetting and controlling risks; the ongoing pursuit of this purpose has resulted in involving ❯ Groupama Assurances Mutuelles in the insurance business of the Groupama regional mutuals in a balanced and controlled way.

Regional mutuals are required by law to obtain reinsurance exclusively from Groupama Assurances Mutuelles. This requirement is laid down in the bylaws of the regional mutuals. This reinsurance exclusivity engenders financial solidarity over time, resulting in a transfer of a substantial proportion of the insurance business from the regional mutuals to Groupama Assurances Mutuelles. The reinsurance relationship is based on the principle of “shared future” between the regional mutuals as ceding companies and their reinsurer Groupama Assurances Mutuelles. The principle aims to ensure that over the long term, there are neither winners nor losers between ceding companies and their reinsurer. The need for reinsurance has been behind the ties forged amongst the Groupama mutuals since they were founded more than a century ago. The geographical district covered by the mutuals, which at the time was limited to one or two French departments, led them to seek compensation for the risks taken at the national level in order to expand, following the example of the growth achieved by the large rival insurance companies. Thus, as time went on, an Internal Reinsurance system grew up amongst the regional insurance mutuals and a central mutual, whose reinsurance role is now assumed by Groupama Assurances Mutuelles. The reinsurance of the regional mutuals by Groupama Assurances Mutuelles is intended, through an internal pooling of risks, to give each mutual, within its district, underwriting capabilities equivalent to those enjoyed by a single company covering the entire territory. It also limits the use of outside reinsurance to what would be needed by such a company. In order to achieve this objective, the regional mutuals are reinsured within a common framework set by general regulations and not by individual reinsurance treaties. This agreement, which was designed a long time ago, is based permanent founding principles that have outlasted the adjustments made to it over time. These permanent principles are: reinsurance exclusively with Groupama Assurances Mutuelles; ❯ the reinsurance conditions laid down by the agreement are ❯ developed by consultative bodies whose members are from Groupama Assurances Mutuelles and all the mutuals. These conditions are valid and apply to all the regional mutuals; shared future amongst the mutuals and their internal reinsurer: all ❯ risks without exception are subject to outward reinsurance particularly as quota share outward reinsurance, which enables Groupama Assurances Mutuelles to participate in the business growth of the mutuals, including in those divisions where reinsurance is not technically indispensable (health insurance, for example); in consideration, Groupama Assurances Mutuelles automatically provides the mutuals with reinsurance when they embark on new, less well-known ventures (multi-risk crop insurance, long-term care insurance, etc.) by calculating the insurance terms and conditions regardless;

64 Universal Registration Document 2021 - GROUPAMA ASSURANCES MUTUELLES