Tunis ReNews LetterThird Quarter 2015

Cyber Risk InsuranceWith the increasing progress of new technology, companies are called on to adapt and evolve with changes related to internet. Indeed, what characterizes today’s world is undoubtedly the ease with which anyone can access any information, regardless of its degree of importance or nature.If this development facilitates the daily work, it also opens the door to viruses and other malware.Advantages put aside, this also includes risks (cyber risks), the consequences of which can be significant for professionals, it is therefore important to be aware and to know how to protect oneself.In less than ten years, the number of connected machines will exceed 30 billion, and these will constitute as many potential vectors of cyber risks.

Some key figures:

• 42% of the world population that is 3,025,000,000 people use theInternet.• In Africa, Internet penetration rate is estimated to be 18% in 2014 that is 167 million Internet users, against 110 million in 2010, at the end of 2015 the number of Internet users is estimated to be 600 million.• Internet penetration rate in the World:

o 81% in North America (86% in Canada, 80% in the USA)o 78% in Western Europe (83% in France)o 18% in Africao 12% in South Asia

Actually, cybercrime has many risks to which companies are faced:• Personal Data theft• Reputation and Image• Loss of turnover• Data ExtortionAll these risks create a major financial cost if the company suffers a cyber attack. Many companies had to close their operations because they did not have the financial means to cover the loss of turnover and especially to indemnify their clients.A study conducted by SafeNet, Gemalto, a company specialized in cyber security has just been published and shows that more than one billion twenty-three million data were stolen during the year 2014. This is an absolute record marked by an increase of 78% in volume over a year.

N° 14

E d i t o r i a lWe are pleased to announce the 13th Carthage meeting that will be held in Tunis on 8, 9 and 10 November 2015, for which have the great pleasure to organize jointly with the Tunisian Federation of insurance Companies (FTUSA) and the General Arab Insurance Federation (GAIF).

The Carthage meeting is an opportunity to treat the most important topics chosen according to the prevailing circumstances, and it contributes effectively to the strengthening of business relations between the various professionals of the Insurance and Reinsurance industry of the MENA region.

The debate theme for this 13th meeting will focus on the “Insurance, Investment and Development“.

Investment is the key to the growth and the future of any country. Long-term investment stimulates innovation, finances research, creates jobs and restores competitiveness; and insurers must naturally play a crucial role alongside the public authorities to ensure economic growth.

Long-term investing is in the DNA of insurers, and insurance plays always an important role in the economy and business financing.

This event offers, also a timely opportunity for regional consultations and presents an opportunity to raise the professional skills of the insurance and reinsurance industry in our markets, these exchanges provide opportunities for insurers and reinsurers to exhibit their actions and projects in the service of the long-term financing of their respective economies.

Tunis Re, aware of the challenges of the moment, works unceasingly to the conjunction of the relations between the various players in the insurance and reinsurance industry in our region. And it is in this context that meetings of insurance and reinsurance companies in this Carthage Meeting would offer the opportunity for participants to consult on their concerns about the current and future state of the sector.

Lamia Ben Mahmoud

Representative Office Africa - AbidjanAbidjan Cocody les 2 Plateaux VallonRue J14, Immeuble les Faugéres - BP 2138 Abidjan 06E-mail : tunisre_burabj@tunisre.ciPhone : (225) 22 411 887 - (225) 22 411 981Fax : (225) 22 411 964www.tunisre.com.tn

Head Office- Tunis12, Avenue du Japon MontplaisirB.P 29 - 1073 TunisE-mail : tunisre@tunisre.com.tnPhone : (216) 71 904 911Fax: (216) 71 904 930www.tunisre.com.tn

CYBEr riSK iNSUraNCE (Continued) The data acquisition hacking has increased by 49% in one year. Identity theft comes in the first position in the ranking of the motivations of cybercrime and accounts alone for 54% of attacks. The most affected sectors are retail sale with 55% of the total volume of stolen data, followed by the financial services sector with 20% of thefts. The study shows that 76% of the 2014 data theft transactions occurred in North America.In the 2012 ranking of the seventh World Economic Forum, cybercrime enters in the top 5 of the potential threats at high risk.According to a report issued by the Center for Strategic and International Studies (CSIS) and commissioned by McAfee, the cost of cybercrime would be between 375 and 575 billion dollars a year.

Given the alarming development of this phenomenon, risk management has become a priority for governments and enterprises; One of the solutions is insurance, so what is it about now?

CYBER RISK INSURANCE

While global sales of cyber risk insurance premiums were only $ 200 million in 2002, they could reach 3.5 to 4.5 billion dollars in 2020 and 7 to $ 11.1 billion in 2025 according to a recent study conducted by the insurance Institute of Canada. During the last decade, the market has indeed grown at an average annual rate of about 20% to reach $ 1.5 billion in 2013.Currently cyber insurance is highly developed in the United States which accounts for 90% of global premiums (about $ 2 billion in 2014); this is the consequence of the US IT security legislation requiring companies to buy an insurance cover against the risks of cyber attacks.

The cyber risks insurance market is expanding rapidly and it constitutes a major growth potential for insurers. Nevertheless, the development of this niche was partially limited by several factors including:- The difficulty in analyzing the risk (issue of insurability); cyber risks have features that make them uninsurable today by traditional actuarial methods, (in the US, only 2% of the losses related to cybercrime are covered by insurance);- The level of technical expertise; insurers should refer to IT experts for risk assessment;- The high cost of insurance covers.

Typical premiums for cyber insurance

Source : Deloitte research on insurance provider web sites.

Scope of cover

Cyber insurance covers denials of service (blocked access to the company website) Virus attacks, restoration costs of electronic data, costs of investigation and notifications.IT Financial Protection insurance allows also to cover the company Third Party Liability (TPL), acts of defamation and unauthorized data collection. The insurance covers also the associated defense costs and the fees of Security Consulting.Despite established insurance solutions, companies should never forget that the image loss, the degradation of their reputation, or the loss of a competitive advantage constitute indirect losses which are not insurable.Reconstruction costs or modernisation of IT systems are also not considered.Prevention and anticipation in this field are therefore very important.

Company Premiums Losses InvestmentsSept-15 Sept-14 Var % Sept-15 Sept-14 Var % Sept-15 Sept-14 Var %

STAR 243.657 225.230 8% 140.484 137.069 2% 34.855 30.862 13%ASTREE 101.560 96.846 5% 82.876 34.179 142% 14.268 13.296 7%SALIM 45.134 35.938 26% 20.867 14.304 46% 5.285 4.302 23%Tunis Re 70.661 65.213 8.4% 38.295 39.907 -4% 9.957 7.682 30%

Stock market : Figures as at 30.09.2015 of the listed Insurance Companies (in M TND)

aCtiVitY FiGUrES Tunis Re

Tunisian Market

The highlights having marked the activity during the 3rd

quarter of 2015.

Activity Figures of Tunis Re: 3rd Quarter 2015

Activity Figures of The Tunisian Sector as at 30Th June 2015At June 30Th, 2015, The Insurance sector in Tunisia has

been characterized by : 2013 2014 Evolution 30/06/2014 30/06/2015 Evolution

Turnover 1 412.7 1 527.4 8.1% 862.4 937.7 8.7%

Motor 638.7 694 8.7% 387 426.3 10.2%

Life 221.3 258.8 16.9% 126 143.7 14%

Others 552.7 574.6 4% 349.4 367.7 5.3%

Claim Charges 848.1 834.6 -1.6% 350.1 384.5 9.8%

Motor 421.6 454.1 8% 197.4 224.9 13.9%

Life 63.8 64 0% 21.74 27.91 28.4%

Others 362.7 316.5 -13% 131 131.6 0.5%

Nbr of underwritten policies 2 145 962 2 392 015 11.5% 1 431 635 1 246 402 -12.9%

Motor 1 337 094 1 368 628 2.4% 758 195 792 273 4.5%

Life 414 975 634 811 53% 433 593 224 751 -48.2%

Others 393 893 388 576 -1.3% 239 847 229 378 -4.4%

Nbr of Reported Claims 1 180 661 1 301 918 10.3% 588 878 655 940 11.4%

Motor 231 716 236 944 2% 117 983 119 432 1.2%

Others 948 945 1 064 974 12% 470 895 536 508 13.9%

Investments 3 414.6 3 883.8 13.7% 3 711.3 4 067.7 9.6%

Non-Life 2 635,2 3 009,1 14,2% 2 875,5 3111,6 8,2%

Life 779,4 874,7 12,2% 835,8 956,1 14,4%

in M TND

In TND3rd Quarter 2014 3rd Quarter 2015 As at 30.09.2014 As at 30.09.2015 2014

PREMIUMSAcceptanceLife & Non Life 17 160 405 18 181 324 62 288 908 66 195 795 93 303 063Retakaful 1 010 916 862 151 2 924 187 4 465 230 4 330 986TOTAL 18 171 321 19 043 475 65 213 095 70 661 025 97 634 049

RetrocessionLife & Non Life 6 251 809 4 133 461 26 824 190 25 887 553 45 657 582Retakaful 158 248 262 420 730 837 917 252 1 029 113TOTAL 6 410 057 4 395 881 27 555 027 26 804 805 46 686 695N E T 11 761 264 14 647 594 37 658 068 43 856 220 50 947 354

ACQUISITION COSTSAcceptanceLife & Non Life 4 194 211 4 547 019 15 582 242 17 734 571 21 432 749Retakaful 215 575 48 214 583 207 890 956 947 247TOTAL 4 409 786 4 595 233 16 165 449 18 625 527 22 379 996

RetrocessionLife & Non Life 826 916 734 308 6 663 618 7 510 442 7 503 858Retakaful 9 104 34 887 135 853 231 996 187 335TOTAL 836 020 769 195 6 799 471 7 742 438 7 691 193N E T 3 573 766 3 826 038 9 365 978 10 883 089 14 688 803

INCURRED LOSSESAcceptanceLife & Non Life 18 651 317 13 390 075 38 640 128 35 603 127 49 554 512Retakaful 467 893 616 325 1 266 995 2 691 803 2 032 258TOTAL 19 119 210 14 006 400 39 907 123 38 294 930 51 586 770

RetrocessionLife & Non Life 10 120 824 4 898 573 19 100 467 17 929 982 21 771 354Retakaful 30 895 59 460 154 840 669 624 246 982TOTAL 10 151 719 4 958 033 19 255 307 18 599 606 22 018 336N E T 8 967 491 9 048 367 20 651 816 19 695 324 29 568 434

FINANCIAL INCOME3rd Quarter 2014 3rd Quarter 2015 As at 30.09.2014 As at 30.09.2015 2014

Financial Income 2 183 864 2 840 784 7 624 773 9 876 851 10 649 907

Financial Income Retakaful 18 035 27 777 57 144 79 701 86 191

TOTAL 2 201 899 2 868 561 7 681 917 9 956 552 10 736 098

Director of Publication : Mrs Lamia Ben MAHMOUD

Société Tunisienne de Réassurance 12, Avenue du Japon Montplaisir - P.O. Box 29 - 1073 Tunis - Phone : (216) 71 904 911 Fax: (216) 71 904 930 R.C. : B1115971996

Contact : Marketing Department Web site : www.tunisre.com.tn Email : mark@tunisre.com.tn

N E w Sinternational

Rendez-Vous de September 2015

The 59th edition of “Rendez-vous de September” in Monte Carlo registered the participation of nearly 2,800 professionals from the insurance and reinsurance industry, to negotiate prices subject of the 2016 renewals. The reinsurance market remains stable with a further downward trend, which is explained by the abundant supply, which puts prices more under pressure.

Reinsurance in Morocco: New Prudential Rules

A new decree has just been published in order to fix the rules of constitution, placement and assessment of technical provisions by requiring diversified and appropriately allocated assets. This is in order to ensure the financial stability of reinsurers in Morocco.

Mamda Re and the SCR will be thereby required to align with the new requirements for technical provisions.

Saham Finance acquires 53.6% of Continental Re

The Moroccan group Saham Finance announced in a news release the acquisition of 53.6% of the Nigerian company «Continental Re». However, the amount of transaction has not been revealed.

Qatar Re plans to remove to Bermuda

Qatar Insurance Company prepares to move its current headquarters from Qatar Financial Center (Doha, Qatar) to Bermuda. However, the company will maintain a subsidiary in the Qatar Financial Center.

Its representative offices in London and Singapore as well as the Zurich branch will remain operational.

SONAM takes control of 3A

The National Mutual Insurance Company of Senegal «SONAM» has acquired 51% of the African Alliance Insurance capital, Ivory Coast (3A). The amount of the transaction amounted to FCFA 1.05 billion (USD 1.78 million). The Inter-African Conference of insurance markets (CIMA) has approved the transaction.

White Mountains Insurance Group cedes Sirius

The White Mountains Insurance Group has decided to sell Sirius International Insurance Group to CM International Holding PTE Ltd headquartered in Singapore, the subsidiary in charge of placements of China Minsheng Investment Corp «CMI».

Chedid Re Announces a Strategic Partnership with PartnerRe

«Chedid Re» has signed a strategic partnership with «PartnerRe». He has also succeeded to obtain recognition of the Lloyd’s market as licensed broker.

Appointment of a new General Secretary for the CIMA

Mr. Issofa Nchare has been appointed as General Secretary of CIMA for a term of five years and will be assisted by two deputy General secretaries . It is the Burkinabe Boubacar Sangaré, reappointed for a term of 5 years, and the Nigerien Mamadou Malam.

National

Tunis Re Flash Infos

AM Best has affirmed on July 10th, 2015, the technical and financial strength rating of B+ (Good) with a stable outlook to Tunis Re, and this, despite a difficult economic and financial context.

This Confirmation will undoubtedly support the financial credibility of the company and offers new opportunities abroad.

«Insured Guarantee Fund»

By Decree-Law No. 2011-40 Tunis Re was responsible for managing the Fund, hereinafter the situation as at 17 September 2015.

Number of Files

Deposed 1 079

Treated 1077Accepted 726Approved amount in TND 51 075 390

Settled amount in TND 49 076 860

Change of governance in BIAT Insurance

Mrs Nejla Harrouche, has been appointed as General Director at the head of BIAT Insurance.

Capital increase of «BIAT Insurance»

The General Extraordinary Assembly of BIAT Insurance met on September 22nd 2015 decided to increase the share capital of the company by 12 million dinars to bring it from 10 million dinars to 22 million dinars.

Capital increase of «AMI Insurance»

The General Extraordinary Assembly of AMI Insurance met on October 23rd 2015 decided to strengthen its shareholders’ equity by 33 million dinars through increasing its capital by 5 million dinars.

Appointment

Mr. Habib Ben Hassine was appointed as General Director of the Group “Maghrebia” and “Maghrebia Life” to replace Mr. Florian Sallaman.

The World Bank recommendations for the Motor Insurance Market

The World Bank has devoted a study on the Tunisian Motor insurance market. The study includes several recommendations whose objective is to improve the quality of services and outcomes the deficit of this branch.

The findings of the study reveal;

- The establishment of a database that aims to empower and encourage policy holders to improve their driving.

- Reducing the delays of claim compensations.

- The establishment of a compulsory insurance for smaller-engined motorcycles.