UNIVERSAL REGISTRATION DOCUMENT 2023

7 FINANCIAL STATEMENTS Combined financial statements and notes

IFRS 17 changes the timing of recognition of earnings over the life of contracts: compared with the overall level of the liability adequacy test conducted under IFRS 4, the level of aggregation of contracts under IFRS 17 is finer and may therefore lead to the identification of more onerous contracts and the earlier recognition of losses in the income statement (see paragraph 3.12.1.(d)). ❯ in Savings and Pensions and Protection insurance, the CSM’s amortisation profile may vary from the previous timing of recognition of profits under IFRS 4, particularly in the event of significant technical or financial shocks, which may make certain groups of contracts onerous and, in this case, result in the immediate recognition of expected losses in the income statement; ❯ in Property and Casualty insurance and Health insurance, the changes compared with IFRS 4 are limited and mainly include the updating of all claims reserves, the identification of onerous contracts at a finer level, and the inclusion of a non ‑ financial risk adjustment; ❯ shadow accounting, i.e. recognition of the policyholders’ participation in unrealised capital gains or losses on assets underlying the contracts in accordance with the provisions of IFRS 4 for insurance contracts and investment contracts with discretionary participation, no longer applies under IFRS 17. The share of unrealised gains or losses on the underlying assets of direct participation contracts that was included in equity is now included in the CSM. ❯ In terms of the presentation of the combined balance sheet, the other changes compared with IFRS 4 mainly concern: deferred acquisition costs, which have been eliminated. These assets are now implicitly included in the contractual service margin and amortised according to the same timing as the margin; ❯ insurance and reinsurance receivables and payables, which are no longer presented separately from insurance liabilities and reinsurance assets but now taken into account in the best estimate of future cash flows, resulting in a decrease in the total amounts of assets and liabilities; ❯ portfolios of contract with an asset balance position and those with a liability balance position are presented separately in the statement of financial position, respectively, as assets or liabilities in this statement. ❯ With regard to the presentation of the income statement, the new IFRS 17 presentation consists of an insurance service result (composed of “insurance service revenue” and “insurance service expenses”) and an insurance financial result. The insurance result does not immediately capture the future profitability of a contract, since the CSM will be gradually released into the result as the services are rendered. Insurance service income no longer reflects the premiums written during the period but the premiums earned during the period, net of the investment component, corresponding to the recognition of both fulfilment cash flows (composed of cash flows expected over the period and reversal of the non ‑ financial risk adjustment) and amortisation (or possible allocation) of the contractual service margin. Insurance service expenses mainly include changes in the liability for incurred claims (LIC) and expenses incurred during the period (attributable expenses), as well as changes relating to future services (which do not adjust the LIC), i.e. losses on groups of loss ‑ making contracts and reversals of such losses. The insurance financial result comprises insurance

2.2.1 IFRS provisions in place since 1 January 2023 (a) IFRS 17 – Insurance Contracts and IFRS 9 – Financial Instruments

The Group applied IFRS 17 – Insurance Contracts and IFRS 9 – Financial Instruments for the first time in its financial statements for the period ended 1 January 2023. The IFRS 17 standard on insurance contracts was adopted in November 2021 by the European Union with, in relation to the provisions of the standard and its amendments published by the IASB in May 2017 and June 2020, an optional exemption from the requirement for annual cohorts in certain specific cases. With effect from 1 January 2023 (with a mandatory comparative year in 2022), its provisions replace those applied under IFRS 4. The Group elected to defer application of IFRS 9 on financial instruments, adopted by the European Union in November 2016, until the fiscal year beginning on 1 January 2023 in accordance with the amendments to IFRS 4 adopted in November 2017 and December 2020, which allowed groups whose main business is insurance to defer application of IFRS 9 until annual financial periods beginning on or after 1 January 2023 at the latest. The Group elected to present comparative information during the first ‑ time adoption of IFRS 9 in accordance with the amendment to IFRS 17 “First ‑ time Adoption of IFRS 17 and IFRS 9 – Comparative Information” adopted by the European Union in September 2022. The amendment allows entities applying IFRS 17 and IFRS 9 for the first time simultaneously to present comparative information on a financial asset as if the provisions of IFRS 9 relating to classification and measurement had already for this financial asset. To present this comparative information on financial instruments, the Group applied classification overlay provided for in the amendment to all eligible financial assets and the impairment provisions of IFRS 9. (b) IFRS 17 – Insurance Contracts MAIN CHANGES RESULTING FROM THE ADOPTION OF IFRS 17 IFRS 17 – Insurance Contracts modifies the accounting for insurance contracts under IFRS 4. It sets out the principles for the recognition, measurement, and presentation of insurance contracts within its scope ( i.e. insurance contracts issued, reinsurance contracts issued and held, and financial contracts with discretionary participation). The main changes in the measurement of insurance contracts compared with IFRS 4 are as follows: under IFRS 17, underwriting reserves include the “best estimate” of the present value of future cash flows (prospective and taking into account market conditions); ❯ the establishment under IFRS 17 of a risk adjustment (“RA”) for non ‑ financial risk corresponds to the remuneration required by Groupama to assume the uncertainty over the amount and timing of cash flows caused by non ‑ financial risk when insurance contracts are performed; ❯ the introduction of the contractual service margin (“CSM”) constitutes a major change; the CSM represents the present value of expected future profits for profitable contracts and is gradually recognised in profit or loss over the contract coverage period during which Groupama provides services to the policyholders; ❯

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Universal Registration Document 2023 GROUPAMA ASSURANCES MUTUELLES