Protector Forsikring — Investor Presentation 2021

Jul 8, 2021

Q2 2021 Interim results

Investor Presentation

Oslo, 9 July 2021

Henrik Høye Chief Executive Officer

Disclaimer

This presentation and the information contained herein have been prepared by and is the sole responsibility of Protector Forsikring ASA (the "Company"). Such information is being provided to you solely for your information and may not be reproduced, retransmitted, further distributed to any other person or published, in whole or in part, for any purpose. Failure to comply with this restriction may constitute a violation of applicable securities laws. The information and opinions presented herein are based on general information gathered at the time of writing and are therefore subject to change without notice. The Company assumes no obligationsto update or correct any of the information set out herein.

These materials may contain statements about future events and expectations that are forward-looking statements. Any statement in these materials that is not a statement of historical fact including, without limitation, those regarding the Company's financial position, business strategy, plans and objectives of management for future operations is a forward-looking statement that involves known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such forward-looking statements are based on numerous assumptions regarding the Company's present and future business strategies and the environment in which the Company will operate in the future. The Company assumes no obligations to update the forward-looking statements contained herein to reflect actual results, changes in assumptions or changes in factors affecting these statements.

This presentation does not constitute or form part of, and is not prepared or made in connection with, an offer or invitation to sell, or any solicitation of any offer to subscribe for or purchase any securities and nothing contained herein shall form the basis of any contract or commitment whatsoever. No reliance may be placed for any purposes whatsoever on the information contained in this presentation or on its completeness, accuracy or fairness. The information in this presentation is subject to verification, completion and change. The contents of this presentation have not been independently verified. While the Company relies on information obtained from sources believed to be reliable, it does not guarantee its accuracy or completeness. Accordingly, no representation or warranty, express or implied, is made or given by or on behalf of the Company or any of its owners, directors, officers or employees or any other person as to the accuracy, completeness or fairness of the information or opinions contained in this presentation. None of the Company, its affiliates or any of their respective advisors or representatives or any other person shall have any liability whatsoever (in negligence or otherwise) for any loss howsoever arising from any use of this presentation or its contents or otherwise arising in connection with the presentation. The Company's securities have not been and will not be registered under the US Securities Act of 1933, as amended (the "US Securities Act"), and are offered and sold only outside the United States in accordance with an exemption from registration provided by Regulation S of the US Securities Act.

This presentation should not form the basis of any investment decision. Investors and prospective investors in securities of any issuer mentioned herein are required to make their own independent investigation and appraisal of the business and financial condition of such company and the nature of the securities. Any decision to purchase securities in the context of a proposed offering of securities, if any, should be made solely on the basis of information contained in any offering documents published in relation to such an offering. For further information about the Company, reference is made public disclosures made by the Company, such as filings made with the Oslo Stock Exchange, periodic reports and other materials available on the Company's web pages.

Our DNA

Vision

The Challenger

Business Idea

This will happen through unique relationships, best in class decisionmaking and cost effective solutions

Main targets

Cost and quality leadership

Profitable growth

Top 3

Values

Credible

Innovative/Open

Bold

Committed

Result highlight Q2 & H1 2021

Q2: Combined ratio at 83.9% | Investment return at 1.0% | EPS at NOK 3.2

Other highlights:

• Setback in Nordic Broker satisfaction
• Continued profitability measures
• Price increases at 9.2% (Q2) and 8.8% (H1)
• Cost still on the agenda
• Special dividend of NOK 1.67 per share

Claims update Q2 claims ratio at 76.3%, 5.6%-points down from last year

• Net run off loss at 1.9 % in Q2 21 (-1.9% in Q2 20)
• Large losses¹ at 3.9% (5.7%), 3.1%-points lower than normalized
• Positive COVID-19 effects of 1.4%-points
• Mainly driven by Motor

Business unit	Q2 '21 Gross	Q2 '21 Net	Q2 '20 Gross	Q2 '20 Net
Norway	72 %	82 %	80 %	80 %
Sweden	59 %	63 %	90 %	90 %
Denmark	119 %	84 %	98 %	98 %
UK	82 %	85 %	57 %	61 %
Finland	60 %	65 %	49 %	51 %
Protector	77.3 %	76.3 %	80.7 %	81.9 %

Business unit	H1 '21 Gross	H1 '21 Net	H1 '20 Gross	H1 '20 Net
Norway	70 %	83 %	87 %	88 %
Sweden	60 %	64 %	85 %	84 %
Denmark	111 %	84 %	102 %	105 %
UK	79 %	84 %	61 %	70 %
Finland	80 %	81 %	60 %	62 %
Protector	76.0 %	77.4 %	83.1 %	85.7 %

Large losses and run off in Q2 Large losses¹ of MNOK 55 (3.9%), run off loss at 1.9%

• Large losses¹ at 3.9% (5.7%), 3.1%-points lower than normalized

• Net run off loss at 1.9 % in Q2 21 (-1.9% in Q2 20)
• Whereof a 2.3% run off loss is directly linked to large losses
  • Losses in UK & Denmark (MNOK 78)
  • Gains in Sweden (MNOK 61)

• Some volatility in reserves & large losses must be expected

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Volume update GWP up 10.9% in quarter, 21.7% in local currency

•	Q2: Second biggest quarter
	• 2021 growth 10.9% (21.7% in LCY)
	• Renewal rate at 94.9 %
	• Realized price increases at 9.2%
	• New sales at MNOK 213, mainly from UK and Sweden

• H1 comprises > 70 % of GWP
• 2021 growth: 4.7% (7.0% in LCY)
• Realized price increases at 8.8%
• Current price increases and underwriting account for increased inflation due to Covid
• Still behind guiding for 2021; no changes made
• Strong start to Q3

Business unit	Q2 '21		Q2 '20 Growth
Norway	262	266	- 4
Sweden	402	362	40
Denmark	39	41	- 2
UK	721	621	100
Finland	4	- 3	6
Protector	1 429	1 288	141
COI	60	64	-4
Protector incl. COI	1 489	1 352	136

Business unit	H1 '21	H1 '20	Growth
Norway	1 119	1 087	32
Sweden	1 297	1 151	146
Denmark	766	855	- 88
UK	959	813	146
Finland	168	210	- 42
Protector	4 309	4 116	193
COI	107	127	- 20
Protector incl. COI	4 415	4 243	172

Cost development

Cost the real way 11.7% in H1 2021, actions taken across the Nordics

• Cost the real way 11.7% H1 2021, 8.9 % in Q2

• Affected by high share price dev. in Q1²

• Gross cost ratio 8.7% (10.1%)

• Higher broker commission going forward due to growth coming from UK & Sweden

• Net cost ratio 7.6% (10.1%)

• Cost situation has been addressed and is still in focus going forward
• Balance cost & quality leadership improve competitive position

Country-by-country key metrics

Q2 combined ratio at 83.9% | Quarterly country volatility must be expected

Q2 2021
	Norway Sweden Denmark			UK		Finland		Protector
	Q2 2021	Q2 2020	Q2 2021	Q2 2020	Q2 2021	Q2 2020	Q2 2021	Q2 2020	Q2 2021	Q2 2020	Q2 2021	Q2 2020
Gross premium written	262	266	402	362	39	41	721	621	4	- 3	1 429	1 288
Gross premium earned	350	373	422	397	216	251	352	280	75	41	1 415	1 342
Net premium earned	311	331	366	347	187	220	289	220	67	37	1 219	1 155
Gross claims ratio	72.2 %	80.3 %	59.4 %	90.0 %	119.0 %	98.3 %	82.1 %	56.9 %	59.8 %	48.8 %	77.3 %	80.7 %
Gross cost ratio	5.0 %	7.6 %	10.6 %	12.5 %	6.8 %	7.4 %	12.6 %	13.0 %	3.1 %	7.0 %	8.7 %	10.1 %
Gross combined ratio	77.2 %	87.9 %	70.1 %	102.5 %	125.8 %	105.7 %	94.7 %	70.0 %	62.9 %	55.8 %	86.1 %	90.8 %
Net claims ratio	82.0 %	80.2 %	63.1 %	89.6 %	83.9 %	98.1 %	84.8 %	61.5 %	64.9 %	50.8 %	76.3 %	81.9 %
Net cost ratio	3.8 %	7.1 %	8.4 %	13.0 %	6.2 %	8.8 %	13.2 %	12.7 %	-0.2 %	2.5 %	7.6 %	10.1 %
Net combined ratio	85.8 %	87.3 %	71.5 %	102.7 %	90.1 %	106.8 %	98.0 %	74.2 %	64.7 %	53.3 %	83.9 %	92.1 %

H1 2021

	Norway Sweden Denmark		UK		Finland		Protector
	H1 2021	H1 2020	H1 2021	H1 2020	H1 2021	H1 2020	H1 2021	H1 2020	H1 2021	H1 2020	H1 2021	H1 2020
Gross premium written	1 119	1 087	1 297	1 151	766	855	959	813	168	210	4 309	4 116
Gross premium earned	693	740	857	794	423	485	686	507	145	109	2 803	2 636
Net premium earned	616	659	739	696	367	424	543	401	129	97	2 395	2 277
Gross claims ratio	70.2 %	87.3 %	60.3 %	85.1 %	111.4 %	101.6 %	78.7 %	60.8 %	79.9 %	60.5 %	76.0 %	83.1 %
Gross cost ratio	6.9 %	7.6 %	12.7 %	12.3 %	8.6 %	6.6 %	15.5 %	12.8 %	5.6 %	5.1 %	11.0 %	9.7 %
Gross combined ratio	77.1 %	94.9 %	72.9 %	97.4 %	120.0 %	108.1 %	94.2 %	73.6 %	85.5 %	65.5 %	86.9 %	92.8 %
Net claims ratio	82.8 %	88.1 %	64.1 %	84.2 %	84.0 %	105.1 %	84.0 %	69.9 %	81.0 %	62.1 %	77.4 %	85.7 %
Net cost ratio	7.1 %	5.9 %	10.9 %	12.2 %	6.3 %	8.5 %	15.9 %	13.0 %	4.4 %	1.6 %	10.0 %	9.4 %
Net combined ratio	90.0 %	94.0 %	75.0 %	96.4 %	90.3 %	113.7 %	100.0 %	82.9 %	85.4 %	63.7 %	87.4 %	95.1 %

Status vs. 2021 guiding Ahead on profitability, premium growth is picking up

	Guiding 2021	Result Q1	Results Q2	H1
Net Combined Ratio:	90-92%	91.1%	83.9%	87.4%
Return on Equity (ROE):	>20%	17.5%*	7.4%*	25.8%*
Gross Written Premium (GWP) growth:	10% (LCY)	1.5% (LCY)	21.7% (LCY)	7.0% (LCY)
Solvency II Capital Ratio (SCR):	> 150%	216%	235%	235%

Our DNA

Vision

The Challenger

Business Idea

This will happen through unique relationships, best in class decisionmaking and cost effective solutions

Main targets

Cost and quality leadership

Profitable growth

Top 3

Values

Credible

Innovative/Open

Bold

Committed

Quality Leadership

Focus to regain no. 1 position

Quality leader in UK, setback in the Nordics UK far ahead | Focus to regain nr. 1 position in the Nordics

Quality Leadership in 2022 All employees involved in targets and actions

				Targets set for 2022
					Target	2021/20	2019/18	2017
				Tender & new sales	80	78	75	69
				Customer Care and Service	80	79	75	69
			BNO Targets	Claims Handling	75	70	69	68
				BSI total quality leader	1st	2nd	1st	1st
				BSI Claims Handling quality leader	1st	6th	2nd	1st
		Nordic Broker			Target	2021/20	2019/18	2017
		Interviews		Tender & new sales		73	75	78
				Customer Care and Service		74	77	79
		June '21	BSE Targets	Claims Handling		60	60	72
				BSI total quality leader	1st	4th	1st	1st
				BSI Claims Handling quality leader	1st	5th	2nd	1st
Broker Satisfaction
				Target	2021/20	2019/18	2017
Survey				Tender & new sales	78	63	73	63
May '21				Customer Care and Service	75	61	69	60
			BDK Targets	Claims Handling	70	59	71	61
				BSI total quality leader	1st	3rd	1st	1st
		Protector		BSI Claims Handling quality leader	1st	2nd	3rd	1st
		Workshops			Target	2021/20	2019/18	2017
				Tender & new sales	78	73	71	73
		June '21		Customer Care and Service	78	74	70	71
			BFI Targets	Claims Handling	70	61	63	70
				BSI total quality leader	1st	6th	2nd	1st
				BSI Claims Handling quality leader	1st	5th	5th	2nd
						2021/20	2019/18	2017
				Tender & new sales	Target 79	72	74	71
				Customer Care and Service	78	72	73	70
			Nordic Benchmark	Claims Handling	73	63	66	68
				BSI total quality leader	1st	3rd	1st	1st
				BSI Claims Handling quality leader	1st	4th	3rd	1st

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Our DNA

Vision

The Challenger

Business Idea

This will happen through unique relationships, best in class decisionmaking and cost effective solutions

Main targets

Cost and quality leadership

Profitable growth

Top 3

Values

Credible

Innovative/Open

Bold

Committed

Investments

Investment is core

Investment performance and statistics

1.0% return in Q2 | Bond portfolio yield at 1.8%, before cost of risk

• Q2 return on investment portfolio at 1.0%, or MNOK 144
• Equity portfolio, ex. put options, returning 3.5%, or MNOK 82
• Bond portfolio returning 0.6%, or MNOK 75
• H1 return on investment portfolio at 5.1%, or MNOK 724
• Equity portfolio, ex. put options, returning 31.6%, or MNOK 590
• Bond portfolio returning 1.4%, or MNOK 167
• Equity share at 14.0%, down from 16.2% in Q1 '21
• Largest position realized in full
• Bond portfolio's average rating at BBB+
• HY portfolio totalling BNOK 4.3 vs BNOK 4.2 in Q1 '21
• Continued strong Nordic HY bond market in quarter
• DNB Markets Nordic HY index return +2.4%

0.6% 1.4% 1.0%

5.1%

	Investment portfolio data	30.06.21	30.06.20	31.03.21
	Size bond & cash eq. (MNOK)3	12 139	11 857	12 472
	Avg. ref. rate (NIBOR, STIBOR, etc.)	0.1%	0.2%	0.2%
	Avg. spread/risk premium (bps)	175	235	179
Bonds	Yield	1.8%	2.5%	2.0%
	Duration	0.4	0.4	0.4
	Credit duration4	1.3	1.9	1.4
	Avg. rating5	BBB+	A	A
	Portfolio size	2 050	1 063	2 355
	Share of total	14.0%	8.6%	16.2%
Equities	Estimated intrinsic value discount	27%	37%	15%
	No. of companies	21	14	20

Equities¹ Bonds Total²

¹ Equity portfolio return excluding put options

²Total portfolio return including put options

³ Size excludes currency swap contracts

⁴Avg. includes bank deposits

3.5%

⁵Avg. linear rating based on official rating (>60%) and 'Protector rating' (<40%)

Our DNA

Vision

The Challenger

Business Idea

This will happen through unique relationships, best in class decisionmaking and cost effective solutions

Main targets

Cost and quality leadership

Profitable growth

Top 3

Values

Credible

Innovative/Open

Bold

Committed

Profit and loss Q2 (&H1) Profit of MNOK 267 (840) – EPS at NOK 3.2 (10.2)

Balance Sheet SCR-ratio at 235% post Q2 special dividend

In millions	30.06.2021	30.06.2020	31.12.2020
Owner-occupied property	0.0	12.6	0.0
Financial assets	13 379.0	11 168.1	11 988.6
Derivatives	63.3	25.9	47.9
Bank deposits	108.8	274.2	263.2
Other assets	4 795.6	3 296.1	2 554.9
Discontinued operations	1 712.1	2 401.8	1 895.7
Total assets	20 058.8	17 178.6	16 750.3
Total equity	3 483.2	2 231.9	3 030.5
Subordinated loan capital	1 244.2	1 243.3	1 473.0
Total reserves	10 853.0	10 410.1	9 185.1
Derivatives	37.5	51.2	61.4
Other liabilities	3 489.9	1 903.9	1 888.7
Discontinued operations	951.0	1 338.3	1 111.6
Total equity and liabilities	20 058.8	17 178.6	16 750.3

• Change in SCR-ratio driven by investment result, improved technical profitability and lower capital requirement for market risk

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• Own funds are adjusted for accumulated dividend

SCR-ratio composition

Solvency II SCR ratio at 235%

Composition of SCR:

• Net insurance risk 62%
• Net market risk 28%
• Other risks 10%

Eligible SII capital:

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• Accumulated dividend subtracted from eligible capital
• Guarantee provision subtracted from own funds

SCR composition

Eligible SII capital

Capital allocation – maximize shareholder return Priority 1: Always profitable growth in insurance, if possible

Main capital allocation alternatives:

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2

5

• Allocation towards profitable growth is preferred; stay disciplined
• Challenging to allocate capital in times of low credit spreads and all-time-high stock markets
• How much capital should be kept for future financial market crises? 3
• An attractive alternative if meeting hurdle; will normally have to bid with significant premium 4
• Capital base discipline; flexible distribution of excess capital if allocation cannot be made elsewhere

	• Determine minimum hurdle rate (RoE>20%)
	• Calculate returns for all internal and external allocation alternatives available, by return and risk
Capital allocation approach	• Deploy capital in the most attractive alternatives above hurdle.
	• Release underperforming capital (COI, Price increases, WC Denmark and Norway as example)

Dividend policy A new special dividend of NOK 1.67 per share – Flexible shareholder distribution policy

Solvency II ratio

180%	Current level = 235%	• Capital over 180% in SCR ratio distributed over time
	Normal Range	• Shareholder distribution normally 20%-80% of net profit • Quarterly decisions, all allocation alternatives evaluated • Profitable insurance growth always prioritized
150%		• Build solvency capital, any shareholder distribution only after a careful consideration

• Special dividend of MNOK 137.5 (NOK 1.67 per share); to be paid out around 21 July (ex. dividend 14 July)
• Quarterly assessment going forward

Our DNA

Vision

The Challenger

Business Idea

This will happen through unique relationships, best in class decisionmaking and cost effective solutions

Main targets

Cost and quality leadership

Profitable growth

Top 3

Values

Credible

Innovative/Open

Bold

Committed

Management transition – Deputy CEO in Hans Didring

Fredrik Landelius stepping up as Country Manager Sweden

Result summary Q2 & H1 2021

Q2: Combined ratio at 83.9% | Investment return at 1.0% | EPS at NOK 3.2

	Q2	H1
• Net combined ratio	83.9%	87.4%
• Gross written premium	MNOK 1 429 (+10.9%)	MNOK 4 309 (+4.7%)
• Investment return	MNOK 144 (1.0%)	MNOK 724 (5.1%)
• Profit for the period	MNOK 267	MNOK 840
• Earnings per share	NOK 3.2	NOK 10.2
• Dividend	NOK 1.67 pr. share	NOK 6.34 pr. share
• Solvency Capital Ratio	235%	235%