Insurance Regulations Paraguay

Minimum Shareholders Equity U$S 500.000

Based on premiums
Companies operating in elemental or property and casualty insurance The highest amount of
Based on claims
Solvency Margin At least an uncommitted equity or technical equity

Based on mathematical reserves

MS PT Companies operating in life insurance The sum of
Based on risk capital
100

75 These calculations must be applied for each of the groupings of sections: Automobile, Fire, Miscellaneous Risks, Short-Term Personal Insurance and the rest of the sections and nally add the results obtained in each of the
ve groupings.
50

25 In cases where the Solvency Margin ratio de cit is equal to or greater than 30% of the technical equity required for this indicator (or technical equity not exceeding 70% of the solvency margin), the application of the
precautionary measure of suspension of policy issuance will be applied.

Composed of the net book equity, according to the • Deferred charges

Technical Equity nancial statements deducted: • Loans granted to shareholders and directors

• 30% of the value of real estate in general, except those intended for sale

• Participation in other subsidiaries and a liated companies

• Assets not quali ed under the investment, representativeness, custody of securities and liquidity regimes in force

• Income tax on accumulated results, at the end of each period considered, provided that it does not coincide with the closing of the nancial year or is not
recorded in the accounting records.

• The proposed distribution of prior years' income

• The "excess" portion of the insured capital retained over the limits determined in the Risk Retention Regime

Warranty Reserve They must maintain at all times an Insurance Warranty Not less than 30% of the Uncommitted Equity. In any case, such amount may not be less than 30% of the Minimum Capital
Reserve, independent of the investable reserve required by law.

For the purpose of calculating these provisions, "unearned premium" means the portion of the billed tari premium to be
Provisions for current risks Correspond to unearned premiums earned.

Technical Provisions
Claims in process of liquidation or payment

Provision for Claims Liquidated and Controverted Claims

Equity Branch
Claims Occurred and Not Reported
Life Branch
They are intended to achieve a
future balance between premiums
Insurers operating in the life insurance business must establish They shall be equivalent, as a minimum, to the Mathematical Reserves for the period of coverage in force according to and risks. They shall be constituted
Mathematical Reserves mathematical balance sheet reserves on a policy-by-policy the Technical Notes approved by this Superintendency, plus the unearned premiums of the current period calculated in accordance with the procedures,
basis using the daily numerals method. mortality tables, technical interest
rates and other aspects
established by the Control
Authority.
Investment Rules of the It establishes the permitted investments, the limits and conditions of investments by type of asset and by issuer, the
Investable Reserves prohibited transactions, the required risk rating and the procedures for transactions with investable reserves
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