Groupama // Universal Registration Document 2022

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FINANCIAL STATEMENTS Combined financial statements and notes

3.11.1 Initial recognition Financing debt is recognised when the Group becomes party to the contractual provisions of this debt. The amount of the debt is then equal to the fair value, adjusted if necessary for the transaction costs directly chargeable to the acquisition or issue of such debt.

3.12.2 (a) contractual right held by a subscriber to receive an additional payment or another benefit, the amount or maturity of which is fully or partially at the discretion of the insurer and the valuation of which is based either on the performance of a set of contracts or a determined contract, either on the income or loss of the insurer, a fund, or any other entities having issued the contract or on realised and/or unrealised investment returns of a portfolio of specified assets held by the issuer. The accounting methods for financial contracts with discretionary profit sharing are identical to the methods for insurance policies described above. Financial contracts without discretionary profit sharing are treated using the valuation procedures described in paragraph 3.12.3. PREMIUMS Written premiums represent the gross premiums, before reinsurance and tax, net of cancellations, reductions, rebates, of the change in premiums still to be written and of the change in premiums to be cancelled. Premiums written and adjusted for the change in reserves for unearned premiums (which are defined below) constitute earned premiums. INSURANCE POLICY SERVICING EXPENSES Non ‑ life insurance policy servicing expenses mainly include benefits and expenses paid and the change in reserves for claims and other underwriting reserves. Benefits and expenses paid relate to the claims settled net of claims receivable collected for the fiscal year and the periodic payment of annuities. They also include the fees and commissions for the management of claims and payment for services. UNDERWRITING LIABILITIES RELATING TO NON ‑ LIFE INSURANCE POLICIES Underwriting liabilities relating to non ‑ life insurance policies are generally not discounted with the exception of liabilities relating to long ‑ term care risk as well as those relating to current annuities or annuities in the course of establishing incapacity and disability risks. RESERVES FOR UNEARNED PREMIUMS The underwriting reserves for unearned premiums represent the portion of premiums for the period between the inventory date and the next contract payment date. They are calculated on a pro rata basis. RESERVES FOR UNEXPIRED RISKS The reserves for unexpired risks are intended to cover the portion of the cost of claims and the related management fees that exceeds the fraction of deferred premiums net of deferred acquisition costs. Insurance policies under IFRS 4 Non ‑ life insurance policies

3.11.2 Valuation rules Financing debt is subsequently valued at amortised cost using the effective interest rate method.

3.11.3 Derecognition Financing debt is derecognised when the obligation specified in the contract is discharged, cancelled, or expires.

3.12 3.12.1 Underwriting operations Classification and method of recognition There are two categories of contract issued by the Group’s insurance companies: insurance policies and financial contracts with discretionary profit ‑ sharing, which are governed by IFRS 4; ❯ financial contracts without discretionary profit sharing, which are governed by IAS 39. ❯ (a) Insurance policies An insurance policy (or contract) is a contract according to which one party (the insurer) accepts a significant insurance risk of another party (the policyholder) by agreeing to compensate the policyholder if a specified uncertain future event (the insured event) adversely affects the policyholder. An insurance risk is a risk, other than a financial risk, transferred from the policyholder to the issuer. This risk is significant when an insured event may require an insurer to pay significant additional benefits whatever the scenario, with the exception of scenarios that lack business significance. The existing accounting practices for insurance policies subject to IFRS 4 continue to be maintained, with the exception of the equalisation reserves as defined by IFRS 4 which have been annulled, provided that the reserves thus established meet the solvency tests stipulated by international standards (see paragraph 3.12.2.c). Financial contracts Contracts that do not meet the definition of insurance policy as described above are classified as financial contracts. Financial contracts are broken down into two categories: financial contracts with and without discretionary profit sharing. A discretionary profit ‑ sharing clause is defined as the (b)

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Universal Registration Document 2022 - GROUPAMA ASSURANCES MUTUELLES