RUSSIAN REINSURANCE MARKET DEVELOPMENT Dmitry GARMASH Deputy CEO Unity Re Ltd. FIAR, Sinaia, 2012

Market dynamics (FSIS), billion RUR 2011: Non-life insurance GPW23 bln USD. Non-life paid claims 10,6 bln USD Inward reinsurance GPW 1,2 bln USD Inward reinsurance paid claims 0,4 bln USD

Inward reinsurance

Inward R/I 2010 – 1,2 bln $: 1 st year of stabilization. Classic risk business share – about 50%, i.e. roughly 0,6 bln $ Specialist reinsurers – up to 20-25% of total inward R/I GWP Total number of reinsurance players in 2011г. – 133 (2010 – 152$ 2009 – 176; ) Total number of specialist reinsurers - 18 (2010 – 23; 2009 – 25) Oligopolistic structure = quality! Outward reinsurance – stability since 2010: ~3 bln USD 4 Inward reinsurance market, 2011

Factors of trending Market consolidation  better quality of services R/I business from overseas seeking alternative capacities Adaptation and correction of actual strategies Shifting retentions and capacities of R/I players Stability of genuine risky reinsurance volume & absolute amount of claims paid. Dumping and overall rates softening Rise of retentions & reinsurance protections VS

Market players

RankCompanyGWP, ‘000 RUR 1Ingosstrakh Sogaz Unity Re Kapital insurance Moscow Re Allianz VTB Insurance Kapital Re Soglasie Transsib Re Rosgosstrakh SCOR Perestrakhovanie Alfastrakhovanie Russian Re Military IC Market players – Top-15 reinsurers

Business from overseas

18% 60% 16% 2% 4% Business from overseas

Strengthening financial and technical capabilities of the players! Rise of capacities, retentions and retro-programs Difference in leaders of retro- and reinsurance programs Globalization and active development of emerging markets  demand for alternative capacity Further spread of brokers’ activities geographically Historically active cooperation with CIS No binding to world (re)insurance cycle Grounds for growth

UNITY RE A RUSSIAN REINSURANCE LEADER 2011

12 Milestones In 2004, renamed into Reso Re and started its active development within the reinsurance market of Russia and CIS. In 2006, rebranded to Unity Re and also restructured to obtain more high-qualified and experienced team to promote further as the specialist reinsurance center of Group RESO and strategically the leading reinsurer within FSU. In 2007, started operations in overseas markets, writing property, construction and marine business from South America, MENA and SEA regions. In 2007, was granted with the international financial strength rating of ‘BB-’ from Standard & Poor’s. It is maintained until nowdays with the enhancement of the rating outlook from stable to positive. In 2010, Unity Re finally conquered the top position in the market, ranked the first among the specialist reinsurers in Russia (over 1 bln RUR of GPW) In 2011, A.M.Best assigned a secure “B+” rating, outlook stable, to Unity Re.

Vision Developing to maintain the position of the regional reinsurance market leader with Russia and FSU, providing the widest available scope of the first class reinsurance cover and confident linked services from a position of the absolute leading, financially stable, fast and attentive national reinsurer, and gradually promoting overseas as the reasonable medium-size capacity market player highly committed as a supporting reinsurer for the traditional lines of business. Mission To provide a very fast response to cedants’ demands for a wide range of non- life reinsurance lines of business with the first class growing capacity and additional services; to support the clients with underwriting expertise, confident and prompt claims settlement and relevant advisory; to rely upon a stable, integral and solid team of professionals fully committed to company’s performance and clients’ needs; to promote the status of a leading Russian/FSU specialist reinsurer well known worldwide. Vision & mission

14 Market Leading Company Leading specialist Ranked 1 st by reinsurance GPW among specialist reinsurers in Russia & CIS in 2010 and 2011 Established team Highly regarded & solid management team, stable since 2006 Strong financial performance Consistently profitable with strong underlying growth. Results of 2011 (IFRS): net profit 7m US$; LR 53.6%; combined ratio 78.4%; ROE 27% Strong capitalisation Exceptionally capitalised with a very strong solvency margin Rated Financial Strength Rating from a leading international agency Regional distribution Distribution across the whole of Russia and the former USSR territories and overseas Corporate governance IFRS audited accounts since year-end Experienced Supervisory Board. Operating to international standards Excellent operational performance 2011: GPW growth – 25%; market share 6%; Renewal ratio – 87,7%; GPW per capita – 51,1 mln RUR Largest and most stable clients’ base 370 companies from Russia, CIS and overseas Brand A recognizable brand with Russia/FSU; London market; MENA region and SEA Highlights & competences

The 100% shareholder of Unity Re is RESO Holding - one of the leading insurance holdings within Russia & CIS. Currently, the paid-up capital of Unity Re is 500m RUR (~16.6m USD) The actual reinsurance license No of Since 2007, KPMG has been the official auditor of Unity Re for IFRS financials. Legal & compliance

Unity Re has the following actual international ratings assigned: RatingOutlookStatus A.M.BestB+ (Good)StableAssigned: Sept 2011 Standard & Poor's BB / ruAA stableLast mod. Aug 2011 Rating reports specially outline Unity Re’s: Good capitalization Profitability Strong position in the domestic market Very good level of retrocession protection International rating

The scope of Unity Re’s activities is classic reinsurance, where the company offers coverage for all major lines of business: general property, construction, energy and petrochemical, cargo, marine hull, aviation, accident & health, liability. Portfolio 2011

 344 (re)insurance and broking companies from Russia, CIS & overseas  287 companies from Russia, inc. all players from Top-50 (a unique!)  cooperation with all major brokers operating in Russia & internationally Portfolio 2011

The major geographical scope of Unity Re’s business is focused at Russia & CIS. Additionally, since 2006, Unity Re has intensified its activities in overseas markets, writing business from South-East Asia, Central & South America and Africa. Portfolio 2011

Amount paid, USD YearCedantClassComment SOGAZPropertyFire at a refinery Renessans insurancePropertyFurnace explosion at Azovsteel plant AzRe (Azerbaijan)MarineCrash of a motor yacht ROSNOPropertyExplosion at Sayano-Shushenskaya HPP Spasskie vorotaPropertyFire at a business center MICPropertyFire at a food factory EnergogarantPropertyFire at Reftinskaya hydro power plant Military Insurance Co.PropertyCrash of a train Renaissance insurancePropertyFire at a plant Spasskie vorotaMarineLoss of cargo washed from deck SogazAviationCrash of aircraft during lending SogazPropertyEQ at Sakhalin SoglasieMarineDamage to a vessel by grounding Standard-ReservePAAccidental death Asuransi Jasa (Indonesia)PropertyEQ Ard Daatgal (Mongolia)PropertyStorm damage to residential property Largest paid claims

LOBMaximum line - Net retention, PML basis Maximum line Gross retention Property (FAP/PAR/IAR) USD 1,000,000 USD 50,000,000 (for business from Russia/CIS – XOL treaty) CAR/EARUSD 1,000,000 USD 50,000,000 (for business from Russia/CIS – XOL treaty) Energy off-shoreUSD 1,000,000- Marine hull / P&IUSD 500,000USD 7,000,000 (worldwide, XOL treaty) CargoUSD 500,000USD 7,000,000 (worldwide, XOL treaty) GTPLUSD 500,000- AviationUSD 500,000- MotorUSD 250,000- Personal accident USD 200,000USD 1,500,000 Capacity 2012

125047, Russian Federation, Moscow, Gasheka st., 12 Tel.: Fax: Contacts