XPRIMM Insurance Report FY countries: CEE, SEE, CIS Full length statistics in EUR and national currency on

Macroeconomic view CEE - 5.3% GDP growth in 2011 according IMF Diverging results across the region: Turkey and Baltics : >5% - 7% Bulgaria, Hungary, Czech Rep. : 1.5 – 2% Croatia – flat Common characteristics in most countries: Economic slowdown in Q4 Reasonable inflation rates Rather high unemployment rates Weak purchasing power of the population Low crediting activity

Macroeconomic view CIS - 4.5% GDP growth in 2011 according Eurasian Development Bank (except Georgia). Diverging results across the region: Turkmenistan : 9.3% Russia, Ukraine, Moldova and Azerbaijan : 4 – 4.5% Common characteristics in most countries: Raising inflation rates High unemployment rates Weak purchasing power of the population Turkey - 7.6% GDP growth in 2011 Greece - 4.5% GDP fall in 2011

CEE insurance market HU 12% HUF  -13.3% GWP nominal change in EUR HU 12% HUF  -13.3% GWP nominal change in EUR PL 12% PLN  -5.4% GWP nominal change in EUR PL 12% PLN  -5.4% GWP nominal change in EUR GWP evolution depends on the GDP growth model

CEE Consolidated indicators GWP: EUR billion -4% nominal change Weighted growth rate (local currencies): +2.11% Paid claims: EUR 18.6 billion (Slovakia excepted) Insurance density: EUR 253/capita (~4% down) CEE AVERAGE EUR 253/capita CEE AVERAGE EUR 253/capita

CEE Market shares Almost unchanged market shares 1.Poland  Czech Rep.  3.Hungary 9.08  Slovakia 6.05  Slovenia 6.29  Romania 5.92  5.74

CEE Market portfolio Life insurance: 45.6% Non-life insurance : 54.5%

CEE Life insurance 45.6% of CEE portfolio (-1pp y-o-y) GWP: EUR billion -> 6% y-o-y decrease Best dynamic: Albania (25%), Macedonia (40%) Worst dynamic: Latvia (-24%), Estonia (-13.8%) and Hungary (-11%) Insurance lines: Traditional life insurance – negative trend Unit-Linked – positive evolution in most countries (+1.6pp weight in CEE portfolio; +4.3pp weight in life insurance GWP) Perspectives: almost no chances for reinstating or adopting fiscal incentives

CEE Life insurance Life insurance dynamic 2011 UL insurance weight in life segment and dynamic % +92% +56% +2% Paid claims growth rate

CEE Property insurance 12% of CEE portfolio (< +1pp y-o-y) GWP: EUR 3.83 billion -> 2.6% y-o-y increase Paid claims: EUR 1.6 billion -> -28% y-o-y decrease Latvia and Lithuania - the only CEE countries recording much higher property claims than in 2010 Weight of “fire and allied perils in line” in property segment

CEE Motor insurance 29% of CEE portfolio (< -1pp y-o-y) GWP: EUR 9.2 billion -> 5.77% y-o-y decrease Paid claims: EUR 5.5 billion -> ~8% y-o-y decrease Trends: Price war – “to the limit of economic acceptability” Increasing bodily claims Insurance fraud high acquisitions costs

CEE Motor insurance Motor Hull: Lithuania, Latvia, Albania and Bosnia – positive dynamic MTPL: 10 out of 17 countries, positive dynamic; Hungary, Romania, Albania and Czech Rep. – double digit negative dynamic

CIS Consolidated indicators GWP: EUR billion -> 17.5% nominal change Paid claims: ~EUR 22.5 billion -> 11.8% increase Insurance density: EUR 122/capita (~17% up) CIS AVERAGE EUR 122/capita CIS AVERAGE EUR 122/capita

CIS Market shares Russia: > 90% share; EUR 30.4 billion GWP Ukraine: 4.03% share; EUR 1.4 billion GWP Kazakhstan: 3.07% share; EUR 1.03 billion GWP

CIS Specificities Extreme diversity  hardly comparable markets Complexity Portfolio Legislation Ease of access for foreign undertakers Affordability Etc.

SEE: Turkey, Greece, Cyprus Different development stages of the insurance market Very different dimensions Currently, very different economic trends Turkey: GWP: EUR 6.9 billion – 1.9% y-o-y increase Life insurance – cvasi underdeveloped (15.6% weight in portfolio) Motor insurance – almost 40% weight in portfolio Property insurance – 22% weight in portfolio » 3.72 million mandatory policies sold by TCIP in 2011 » Less than 23% coverage of 16 million housing units a hot spot on the acquisitions map

A changing landscape PZU - preparing geographical expansion – first step, the Baltics TRIGLAV and SAVA Re - interested to enter new markets or strengthen their presence in the current ones Vienna Insurance Group - new acquisitions in Poland and Bosnia & Herzegovina and also intends further acquisitions in Hungary and Moldova, different insurers and banks are targeting the Russian market big Russian players (ROSGOSSTRAKH) - expanding in the neighboring countries important legislative adjustments in the young markets Solvency II regime – important challenge for the EU members

We wish you successful business in FIAR !