Ageas / : SFCR - Report 2023

Solvency and

Financial Condition Report

2023

Content

Introduction	..................................................................................................................................................................................	3
Summary	4
A	Business and performance	8
	A.1	Business	9
	A.2	Underwriting performance	14
	A.3.	Investment performance	19
	A.4.	Performance of other activities	20
	A.5.	Any other information	21
B	System of Governance	23
	B.1	General information on the system of governance	24
	B.2	Suitability requirements	29
	B.3	Risk management system including the own risk and solvency assessment	32
	B.4	Internal control system	40
	B.5	Internal Audit function	42
	B.6	Actuarial function	43
	B.7	Outsourcing	44
	B.8	Any other information	46
C	Risk profile	49
	C.1	Underwriting risk	50
	C.2	Market risk	53
	C.3	Credit risk	57
	C.4	Liquidity risk	59
	C.5	Operational risk	61
	C.6	Strategic & Business risks	62
	C.6	Any other information	64
D	Valuation for Solvency Purposes	65
	D.1	Assets	66
	D.2	Technical provisions	71
	D.3	Other liabilities	77
	D.4	Alternative methods for valuation	79
	D.5	Any other information	80
E	Capital Management	81
	E.1	Own Funds	82
	E.2	Solvency Capital Requirement and Minimum Capital Requirement	88
	E.3	Use of the duration-based equity risk sub-module in the calculation of the Solvency Capital Requirement	91
	E.4	Differences between the standard formula and any internal model used	92
	E.5	Non-compliance with the Minimum Capital Requirement and non-compliance with the Solvency Capital Requirement	96
	E.6	Any other information	97

2  Ageas -Solvency and Financial Condition Report 2023

Introduction

References to "Ageas", "Ageas Group" in this document, reflect the group of companies composed of Ageas SA/NV and its subsidiaries. References to "local", "legal entity", "OPCO" or "Operating Company", "Non- Controlled Participations (NCP)" in this report, refer to Ageas its subsidiaries or affiliates. A "subsidiary" means any entity in which Ageas SA/NV, directly or indirectly is a shareholder and has operational control, and an "affiliate" means any entity in which Ageas SA/NV, directly or indirectly is a shareholder and has no operational control.

The structure of this Solvency and Financial Condition Report (SFCR) is in accordance with annex XX (twenty) of the Commission Delegated Regulation (EU) 2015/35. Furthermore, the figures presented in this report are in line with the Quantitative Reporting Templates (QRTs) as reported to the supervisory authorities.

All amounts in this report are presented in (amounts rounded to the nearest) millions of euro (EUR million), unless otherwise stated. The amounts in the QRTs which are disclosed on the website of Ageas are presented in thousands of euro.

Following the introduction of IFRS 9/17, a restatement has been performed for the 2022 comparative tables.

Ageas -Solvency and Financial Condition Report 2023  3

Summary

This document is the 2023 Solvency and Financial Condition Report (SFCR) of Ageas group and Ageas SA/NV as a solo entity related to the Reinsurance Businesses.

The figures presented in this report agree with the Quantitative Reporting Templates (QRTs) as reported to the supervisory authorities. A subset of these QRTs, which are required to be publicly disclosed and which provide quantitative information in accordance with Solvency II as of 31 December 2023, are included in the appendix to this SFCR.

Chapter A 'Business and performance' describes the overall business profile and structure of Ageas SA/NV, it also provides insight into the underwriting and investment performance of the group. Chapter B 'System of Governance' explains the governance structure of the group and describes the set-up of the key Solvency II functions. Chapter C 'Risk profile' describes the main risks Ageas is exposed to (both financial and nonfinancial risks) and how Ageas mitigates these risks. Chapter D 'Valuation for solvency purposes' explains the bridge from the balance sheet based on International Financial Reporting Standards to the valuation of the balance sheet items based on the Solvency II valuation principles. Chapter E 'Capital management' provides an overview of the Eligible Own Funds and the calculation of the Solvency Capital Requirement and the Solvency Capital Ratios.

Ageas serves close to 47 million customers directly or indirectly in 13 countries across Europe and Asia through a combination of wholly owned subsidiaries and long-term partnerships with strong financial institutions and key distributors. Ageas offers Retail and Business customers Life and Non- Life insurance products designed to suit their specific needs, today and tomorrow.

The main products that are commercialised by Ageas are:

• Life savings products both with and without profit sharing
• Life protection products
• Pension products
• Workers Compensation
• Motor related insurance
• Property related insurance.

Significant business or other events

Ageas' 3-year strategic cycle Impact24 kicked off in 2022. The plan aims to steer Ageas towards long-term sustainable growth, built on the Group's well- diversified profile and strong core franchises. Ageas considers what it does today to be a stepping-stone towards where the Group sees itself in the future. The choices and investments made with Impact24 are not just for the next three years but for the years that follow on through 2030 and beyond.

Performance 2023

Overall Ageas delivered a strong commercial performance in 2023 with inflows up 8% in local currency. The significant increase in Non-Life inflows across all segments reflects increased volumes and the continued strong technical pricing discipline in the face of inflation. The growth in Life was driven by strong sales and solid renewals in China.

The strong Net Operating Result 1 of EUR 1.166 million is reflected in solid operating margins. The strong business performance was also reflected in an Operational Capital Generation of EUR 1.8 billion including both the Solvency

1. and the non-Solvency II scope entities. The Operational Free Capital Generation amounted to a strong EUR 1.2 billion. With these results and a Pillar II Solvency ratio of 217%, the Board of Directors has decided to propose a total gross cash dividend of EUR 3.25 per share, representing an increase of over 8% versus last year.

1 For more information about the definition of the Net Operating Result and our performance measures, please refer to Annual Report p. 284

4  Ageas -Solvency and Financial Condition Report 2023

Changes to the group

Disposals in 2023

Ageas France (Europe)

In the last quarter of 2022, Ageas SA/NV decided to engage in a process to dispose of its activities in France. On 21 April 2023, Ageas signed an agreement with La Mutuelle Epargne Retraite Prévoyance Carac regarding the sale. This disposal met the criteria of IFRS 5 to be classified as held for sale. The assets and liabilities at 31 December 2022 related to Ageas France (and its subsidiaries) were classified as a disposal group and were shown as "Assets held for sale" (mainly Financial investments) and "Liabilities related to assets held for sale" (mainly insurance liabilities) in the consolidated statement of financial position. The disposal group was reported in the segment 'Europe'.

The transaction was finalised in the third quarter of 2023, resulting in a net result of EUR (1) million.

AG Insurance (Belgium)

In the first half of 2023, AG Insurance sold its interests in the equity associate Eurocommercial Properties Belgium for a total consideration of EUR 70 million, resulting in a capital gain of EUR 15 million

Risk sensitivity

Financial risk is the most significant risk for many of Ageas's operations. The risk framework in place at all operations combines investment policies, limits, stress tests and regular monitoring to control the nature and level of financial risks and to ensure that risks being taken are appropriate for both customer and shareholder and are appropriately rewarded.

The overall asset mix is determined by local businesses based on asset mix studies to identify the appropriate strategic assets, their adequacy from an Asset Liability Management (ALM) perspective and on regular monitoring of the market situation and prospects to decide on the tactical allocation. The decision process needs to balance risk appetite, capital requirements, long- term risks and return, policyholder expectations, profit sharing requirements, tax and liquidity issues to arrive at an appropriate target mix. The responsibility of the Group Risk function includes monitoring aggregate risk appetite covering financial risks and working with the local businesses to

develop the policies and best practice, which must be adopted by the local Boards to ensure they become part of the local regular activity.

On an annual basis, Ageas runs an analysis of the impacts associated to the key market risk factors. The results are available in the table below and show the sensitivity of the Pillar 1 Solvency Ratio (SCRPIM) and the Pillar 2 Solvency Ratio (SCRAgeas) as at Q4 2023 to the specific stand-alone risk factors. The selection and the calibration of the scenarios do not express Ageas' expectations of future market evolution.

Sustainability risks are part of the risk taxonomy, and risks are considered through the risk in execution cycle within the Ageas Key Risk Reporting (KRR) and Emerging Risk Reporting Processes. Additionally, building on the 2021 and 2022 work performed, Ageas continued to develop its framework for assessing climate risk in its portfolios, and climate change stress tests were performed in the 2023 ORSA.

Valuation differences between Solvency II and IFRS

The most relevant valuation differences between the IFRS balance sheet in the financial statements and the market consistent balance sheet for Solvency II purposes are:

• Derecognition of goodwill and other intangibles under Solvency II;
• Property, loans, sub-liabilities and other investments at amortised cost are valued at fair value under Solvency II;
• Liabilities (technical provisions) arising from (re)insurance and investment contracts are recognised at market-consistent values;
• Recognition of contingent liabilities under Solvency II (not applicable for Ageas)

Ageas -Solvency and Financial Condition Report 2023  5

Valuation of Technical provisions

The main differences between Solvency II and IFRS17 concerning Life liability valuation, arise from the following points:

• Discounting: While in Solvency II a discounting curve is specified by EIOPA, an insurer can specify the used discount curve under IFRS17 to reflect both market consistency and the specific characteristics of the insurance liabilities.
• Contract boundaries: While in Solvency II short contract boundaries need to be respected, IFRS17 allows the use of long contract boundaries. Hence, more future premia are included in the cashflow projections.
• Contractual Service Margin (CSM): While in Solvency II, profits are recognized at inception of a contract, profits will be recognized over the lifetime of a contract under IFRS17 using the CSM.
• Non-attributableexpenses: While in Solvency II, non-attributable expenses are included in the BEL calculation, the latter are not included under IFRS17.

• Risk Adjustment: While in Solvency II a Risk Margin is calculated to price in non-hedgeable risks, a Risk Adjustment is used under IFRS17 which is not calibrated at the same confidence level.

For Non-life business, the main differences are the inclusion of binary events, and the inclusion of a Risk Margin instead of the Risk Adjustment considered under IFRS 17.

Transitional on technical provisions

Ageas' Portuguese entities, as well as Ageas France (sold during Q3) apply transitional measures on technical provisions referred to in Article 308d of Directive 2009/138/EC. The proportional factor denoting the ratio of transitional adjustment applied is updated yearly at January 1st. For year-end

reporting 2023, the factor 9/16 was applied, to be updated to 8/16 starting 01/01/2024. For quantitative impacts, please refer to Quantitative Reporting Template S.22.01.22.

Own Funds

The analysis of the quality of Ageas's Own Funds (covering the Group SCR) shows that at the end of 2023, 81.4% of the eligible Own Funds are of the highest quality (Tier 1). At year-end 2023, the sum of the restricted Tier 1 components amounts to 14.0% of total Tier 1 capital.

The composition of the eligible Own funds to meet the group SCR is as follows:

Own Funds increased from EUR 7,137 million at Q4 2022 to EUR 7,409 million at Q4 2023 explained mainly by the strong operational capital generation and the favourable financial market movements (equities and interest rates). This was partially offset by the dividends paid in 2023 (EUR 540 million) and the foreseeable dividends accrued for the full-year (EUR 315 million).

		31 December 2023		31 December 2022
Own Funds to meet group SCR:	7 409		7 137
Unrestricted Tier 1	5 190		5 024
Eligible Restricted Tier 1	842		802
Available Restricted Tier 1	842		802
Overflow to Tier 2	0		0
Eligible Tier 2	1 327		1 254
Overflow from Tier 1	0		0
Available Tier 2	1 327		1 254
Tier 3		51		58

6  Ageas -Solvency and Financial Condition Report 2023

Solvency Capital Requirement

Pillar I (Capital Requirements) of Solvency II requires insurers to calculate their Solvency Capital Requirement (SCR) using either the Standard Formula or a (Partial) Internal Model (PIM). The Standard Formula is a standardized approach determined by the Solvency II framework, while a (Partial) Internal Model is developed by the insurance company itself. A (Partial) Internal Model requires regulatory approval for use in Pillar 1.

Ageas management believes that given the profile of its Non-life risk book, which mainly consists of traditional retail property and casualty policies, the

Standard Formula overstates risks. For AG Insurance and Ageas Insurance Limited, the Internal Models for Non-life Underwriting Risk have received regulatory approval from both the Belgian and the UK regulators. Ageas Group therefore calculates its regulatory capital requirement under Pillar I based on the SCR PIM.

The table below presents the Solvency Pillar I ratios at Group level as at year-end:

Total Eligible Solvency II Own Funds to meet the Group SCR

Group Required Capital under Partial Internal Model (SCR)

Capital Ratio

Total Eligible Solvency II Own Funds to meet the minimum capital requirement Group SCR

Minimum consolidated Group SCR

Capital ratio

31 December 2023

7 409

3 546

209%

6 424

1 959

328%

31 December 2022

7 137

3 460

206%

6 090

1 863

327%

Pillar II Partial internal model

Pillar II (Governance & Supervision) covers the structure and management of insurance business and how they are governed. Ageas puts risk management at the heart of its decision-making and conducts an Own Risk and Solvency Assessment (ORSA). Management believes that the Pillar 2 should recognize a credit risk linked to European government exposures, whereas this risk is disregarded in the SCR Standard Formula. At the same time management believes the SCR Standard Formula overestimates the

The capital position of Ageas per segment, based on the SCRAgeas, is as follows:

credit risk of corporate bonds: it assesses credit risk on corporate bonds based on observed volatility of credit spreads, while such volatility is less for a buy and hold investor. Ageas' investment strategy is largely determined by the aim to match asset and liability duration. Management also concluded that the SCR Standard Formula is not suited to measure risks linked to investments in real estate.

				31 December 2023					31 December 2022
						Solvency								Solvency
		Own Funds		SCR		Ratio		Own Funds			SCR			Ratio
Belgium	5 562	2 293	243%		5 261		2 182		241%
Europe	1 742	929	187%		1 795			979			183%
India (AFLIC)	279	131	214%		272			114			237%
Ageas RE	940	537	175%		905			441			205%
Non Transferable Own Funds and Diversification	-1 063	-463	.		-998			-432			.
Total Insurance	7 460	3 428	218%		7 235			3 284			220%
General Account including elimination and diversification	205	106	.		102			79			.
Total Ageas	7 665	3 533	217%		7 337			3 363			218%

Ageas -Solvency and Financial Condition Report 2023  7

A. BUSINESS AND PERFORMANCE

A

1. Business and performance

8  Ageas -Solvency and Financial Condition Report 2023

A.1 Business

Business

A.1.1 General information

Name and legal form:

Ageas is a public limited liability company bearing the name Ageas SA/NV. Its registered office is at office at Manhattan Center Brussels, Avenue du Boulevard 21, 1210 Brussels, Belgium. The company is registered in the Brussels register of legal entities under no. 0451.406.524.

Solvency II related Supervisor:

National Bank of Belgium ('NBB'), Boulevard de Berlaimont 14, 1000 Brussels, phone [phone].

External auditor:

PwC Reviseurs d'Entreprises SRL / PwC Bedrijfsrevisoren BV ('PwC'), Culliganlaan 5, 1831 Diegem with Kurt Cappoen as permanent representative.

Annual Report Ageas SA/NV:

In this document references are included to the Annual Report of Ageas SA/NV which is available on the website (https://reporting2023.ageas.com/).

Legal structure:

The group legal structure of Ageas is as follows:

Fully consolidated entities of Ageas in Europe are in UK, Ageas UK Ltd. (100%) and in Portugal, Millenniumbcp Ageas (51%), Médis (100%), Ageas Portugal Vida (100%) and Ageas Portugal Seguros (100%). The full list of undertakings in the scope of the Group is published in the 'Group Public Disclosure QRTs' which can be found on the website: https://www.ageas.com/investors/quarterly-results.

Known shareholders of Ageas SA/NV, based on the official notifications, as

at 31 December 2023 are:
•	Fosun	10.01%;
•	BlackRock, Inc	6.59%;
•	FPIM-SPFI	6.33%;

Ageas SA/NV and its subsidiaries hold 2.30% of its own shares. This interest is related to the FRESH (see note 16 Shareholders' equity and note 12 Subordinated liabilities of the Ageas annual report 2023), restricted share programmes and the share buy-back programmes (see note 16 Shareholders' equity of the Ageas annual report 2023).

Ageas -Solvency and Financial Condition Report 2023  9

A. BUSINESS AND PERFORMANCE

A.1.2 Material lines of business and material geographical areas

Ageas serves close to 47 million customers directly or indirectly in 13 countries across Europe and Asia through a combination of wholly owned subsidiaries and long-term partnerships with strong financial institutions and key distributors. Ageas offers Retail and Business customers Life and Non- Life insurance products designed to suit their specific needs, today and tomorrow.

Ageas has decided that the most appropriate way of reporting operating segments under IFRS is per region in which Ageas operates, i.e. Belgium, Europe (excluding Belgium), Asia and Reinsurance. In addition, Ageas reports activities that are not related to the core insurance business, such as Group financing and other holding activities, in the General Account, which is treated as a separate operating segment.

This segment approach is consistent with the scopes of management responsibilities.

Transactions between the different businesses are executed under standard commercial terms and conditions.

Ageas is organised in five operating segments:

• Belgium;
• Europe (excluding Belgium)
• Asia;
• Reinsurance;
• General Account.

The main products that are commercialised by subsidiaries of Ageas are:

• Life savings products both with and without profit sharing
• Life protection products
• Pension products
• Workers Compensation
• Motor related insurance
• Property related insurance.

Different business activities

Ageas's business model generates several types of income streams:

• Insurance underwriting: These results come from the inflows from the collected insurance policy premiums minus the claims and related expenses. The essence of insurance is the pooling or mutualisation of the risk of insured individuals or corporates brought together into a larger portfolio of insured assets. The customer pays single or regular premiums to cover risks related to Life, Home, Car, Travel, and more specific type of risks which Ageas insures. Ageas in turn pays out claims in case of an adverse event. Fee income may also come from other sources in services beyond insurance.
• Reinsurance underwriting: Ageas set up an internal reinsurance activity in 2015 which allows it to pool group reinsurance protection, retain a part of the risk coverage for its own account and manage the diversification benefits intrinsic to its solvency framework. In 2020, Ageas SA/NV also started to participate in existing Non-Life reinsurance programs of its operational companies with the ambition to further develop the reinsurance expertise and exposure. Ageas started underwriting reinsurance for third parties, operating under the brand Ageas Re in 2023.
• Investments: The investment of premiums into revenue generating assets, such as government or corporate bonds, loans, equities, or real estate, generate additional financial returns. The Group invests in a wide and diversified set of assets spread over many industries. In that way,

Ageas actively supports the economy and society while generating a financial return that benefits in first instance its policyholders, and in a second step flows back to its shareholders or debtholders.

Impact24, a long-term sustainable growth strategy

Ageas considers what we do today to be a stepping-stone towards where the Group sees itself in the future. The choices and investments made with Impact24 are not just for the next three years but for the years that follow on through 2030 and beyond.

Long-term thinking

The Group's internally developed Horizon Scan, using human and artificial intelligence, allows Ageas to continuously monitor the most significant emerging trends and risks, which have served as the backbone of our strategic reflections around the Impact24 plan.

Impact24 provides Ageas with a clear direction going forward, but also allows for flexibility to act upon a range of available global opportunities, changing local market and environmental dynamics, and different evolving scenarios along the way. The plan foresees in risk adjustment and investments in future trends that are likely to impact the world, not only by 2024 but even by 2030 and beyond. By acting today, the Group can ensure that tomorrow it remains relevant for its customers and a leader in the markets in which it operates.

Growing the business

In developing Impact24, Ageas continued to recognise the benefit of a well- diversified and well-balanced portfolio, and the resilience this brings to the Group.

Firstly, the plan aims to unlock the full potential of the Core, the existing activities of the Group. This includes taking a growing share of the market within each country and improving our distribution and commercial excellence for our customers. The further deployment of technology and data and enhancement of the operational efficiency allow to progress and deal with fluctuating market dynamics.

Secondly, to fuel additional growth, Ageas focuses on opportunities in adjacent business where Ageas has the capability to participate and create impact. Home, Mobility and Life & Savings are some of our local companies' priorities. The Group stimulates the groupwide development of new engines with opportunities for growth in the long run: Health, Protection, Digital Platforms and Reinsurance.

Finally, the Group's resilience is ensured through its unique footprint - a mix of geographically spread mature markets and high growth markets. In Impact24, Ageas confirms its belief in local empowerment allowing it to stay close to its customers in each market, underpinned by Group synergies where it creates additional value. The Group will continue to strengthen its market leader positions in Europe and Asia, with an increased focus on Non-Life, Health or Life protection. New capability or distribution partnerships will support the Group in venturing into new areas of growth.

Putting Sustainability at the heart

Ageas recognises it has a duty of care and responsibility to today's and future generations. Through the Impact24 plan, Ageas wants to have a positive and lasting impact on the lives of the people it works with - employees and partners - and the people it works for - customers, investors,

10  Ageas -Solvency and Financial Condition Report 2023