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Curacao

Cayman Islands Anguilla

BritishVirginIslands

St. Maarten

Zimbabwe

Zambia

Yemen Vietnam

Somoa

Venezuela

Vanuatu

Uzbekistan

Uruguay

United States

UnitedKingdom

U.A.E.

Ukraine

Uganda

TurkmenistanTurkey

Tunisia

Trinidad & Tobago

Tonga

Togo

Thailand

Tanzania

Tajikistan

Syria

Switzerland

Sweden

Swaziland

Suriname

Sudan

Sri Lanka

Spain

South Africa

Somalia

Solomon Islands

Slovenia

Slovakia

Singapore

SierraLeone

Serbia

Senegal

Saudi Arabia

Sao Tome & Principe

San Marino

St Vincent & the Grenadines St Lucia

St Kitts & Nevis

Rwanda

Russia

Romania

Qatar

PuertoRico

Portugal

Poland

Philippines

Peru

Paraguay

PapuaNew Guinea

Panama

Palau

Pakistan

Oman

Norway

Nigeria

NigerNicaragua

New Zealand

Netherlands

Nepal

Namibia

Mozambique

Morocco

MongoliaRepublic of

Moldova

Mexico

Mauritius

Mauritania

Malta

Mali

Malaysia

Malawi

Madagascar

Macedonia

Luxembourg

Lithuania

Liechtenstein

Libya

Liberia

Lesotho

Lebanon

Latvia

Laos

Kyrgyzstan

Kuwait

SouthKorea

NorthKorea

Kenya

Kazakhstan

Jordan

Japan

Jamaica

Italy

Israel

Ireland

Iraq Iran

India

Iceland

Hungary

Honduras

Haiti

Guyana

Guinea-Bissau Guinea

Guatemala

Grenada

Greenland

Greece

Ghana

Germany

Georgia

Gambia

Gabon

FrenchGuiana

France

Finland

Fiji

Falkland Islands

CanaryIslands

Azores

Reunion

Sumatra

Borneo

Taiwan

Sakhalin

Kuril Is

lands

NewGuinea

Tierra Del Fuego

South Georgia

Ethiopia

Estonia

Eritrea

Equatorial Guinea

El Salvador

Egypt

Ecuador

East Timor

DominicanRepublic

Dominica

Dijbouti

Denmark

CzechRepublic

Cyprus

Cuba

Croatia

Cote d'Ivoire

Costa Rica

Congo

Dem. Republicof Congo

Comoros

Colombia

China

Chile

Chad

Central AfricaRepublic

Cape Verde

Canada

Cameroon

Cambodia

Burundi

Myanmar

BurkinaFaso

Bulgaria

Brunei

Brazil

Botswana

Bosnia &Herzegovina

Bolivia

Bhutan

Benin

Belize

Belgium

Belarus

Barbados

Bangladesh

Bahrain

Bahamas

Azerbaijan

Austria

Australia

Armenia

Argentina

Antigua & Barbuda

Angola

Andorra

Algeria

Albania

Afghanistan

Western Sahara(Occupied by Morocco)

Montenegro

Isle of Man

Jersey

Guernsey

Monaco

Gibraltar

Seychelles

Russia

Hong KongMacau

Russia

Indonesia

Guam

Northern Mariana Islands

Wake Island

Marshall Islands

Federated Statesof Micronesia

Nauru

Tuvalu

CoralSeaIslands

New Caledonia

Norfolk Island

French Polynesia

Pitcairn Islands

Kiribati

Tokelau

AmericanSamoa

CookIslands

Niue

Curacao

Cayman Islands Anguilla

BritishVirginIslands

St. Maarten

Zimbabwe

Zambia

Yemen Vietnam

Somoa

Venezuela

Vanuatu

Uzbekistan

Uruguay

United States

UnitedKingdom

U.A.E.

Ukraine

Uganda

TurkmenistanTurkey

Tunisia

Trinidad & Tobago

Tonga

Togo

Thailand

Tanzania

Tajikistan

Syria

Switzerland

Sweden

Swaziland

Suriname

Sudan

Sri Lanka

Spain

South Africa

Somalia

Solomon Islands

Slovenia

Slovakia

Singapore

SierraLeone

Serbia

Senegal

Saudi Arabia

Sao Tome & Principe

San Marino

St Vincent & the Grenadines St Lucia

St Kitts & Nevis

Rwanda

Russia

Romania

Qatar

PuertoRico

Portugal

Poland

Philippines

Peru

Paraguay

PapuaNew Guinea

Panama

Palau

Pakistan

Oman

Norway

Nigeria

NigerNicaragua

New Zealand

Netherlands

Nepal

Namibia

Mozambique

Morocco

MongoliaRepublic of

Moldova

Mexico

Mauritius

Mauritania

Malta

Mali

Malaysia

Malawi

Madagascar

Macedonia

Luxembourg

Lithuania

Liechtenstein

Libya

Liberia

Lesotho

Lebanon

Latvia

Laos

Kyrgyzstan

Kuwait

SouthKorea

NorthKorea

Kenya

Kazakhstan

Jordan

Japan

Jamaica

Italy

Israel

Ireland

Iraq Iran

India

Iceland

Hungary

Honduras

Haiti

Guyana

Guinea-Bissau Guinea

Guatemala

Grenada

Greenland

Greece

Ghana

Germany

Georgia

Gambia

Gabon

FrenchGuiana

France

Finland

Fiji

Falkland Islands

CanaryIslands

Azores

Reunion

Sumatra

Borneo

Taiwan

Sakhalin

Kuril Is

lands

NewGuinea

Tierra Del Fuego

South Georgia

Ethiopia

Estonia

Eritrea

Equatorial Guinea

El Salvador

Egypt

Ecuador

East Timor

DominicanRepublic

Dominica

Dijbouti

Denmark

CzechRepublic

Cyprus

Cuba

Croatia

Cote d'Ivoire

Costa Rica

Congo

Dem. Republicof Congo

Comoros

Colombia

China

Chile

Chad

Central AfricaRepublic

Cape Verde

Canada

Cameroon

Cambodia

Burundi

Myanmar

BurkinaFaso

Bulgaria

Brunei

Brazil

Botswana

Bosnia &Herzegovina

Bolivia

Bhutan

Benin

Belize

Belgium

Belarus

Barbados

Bangladesh

Bahrain

Bahamas

Azerbaijan

Austria

Australia

Armenia

Argentina

Antigua & Barbuda

Angola

Andorra

Algeria

Albania

Afghanistan

Western Sahara(Occupied by Morocco)

Montenegro

Isle of Man

Jersey

Guernsey

Monaco

Gibraltar

Seychelles

Russia

Hong KongMacau

Russia

Indonesia

Guam

Northern Mariana Islands

Wake Island

Marshall Islands

Federated Statesof Micronesia

Nauru

Tuvalu

CoralSeaIslands

New Caledonia

Norfolk Island

French Polynesia

Pitcairn Islands

Kiribati

Tokelau

AmericanSamoa

CookIslands

Niue

Nominal GDP USD bn 2624.53Population mil 66.1GDP Per Capita USD 39,735Real GDP Growth % 1.8Inflation Rate % 2.7

Literacy Rate % n.a.Urbanization % 83.1Dependency Ratio % 55.5Life Expectancy Years 80.8Median Age Years 40.5

Insurance Regulator

Premiums Written (Life) USD mil 189,833Premiums Written (Non-Life) USD mil 93,499Premiums Growth (2016 - 2017) % -0.3

United KingdomFranceGermanyIrelandItalySpain

CRT-2CRT-2

Country Risk TierCRT-1CRT-1CRT-1CRT-2

Vital Statistics 2017

Insurance Statistics

Regional Comparison

Prudential Regulation Authority (part of Bank of England)

United Nations Estimates

Source: IMF, UN, Swiss Re, Axco and A.M. Best

Regional Summary: Western Europe•WesternEuropeisahighlydevelopedandaffluentregion.

The 28 countries of the EU accounted for approximately 21.9% of the world’s domestic product in 2016 and 21.6% in2017,afigurethatisprojectedtogrowto22.5%in2018.

•Growth has been driven largely by rising domestic demand duetogrowingconsumerandbusinessconfidence,lowerunemployment rates, and credit growth.

•The European Central Bank (ECB) has decided to end its three-year EUR2.4 trillion quantitative easing program by the end of 2018, although it did signal that any rise in interest rates before September 2019 was unlikely. The policy rate has been below 1.0% since July 2012 and has been at 0.0% since March 2016.

•Concerns include political instability in certain countries, ongoing uncertainty about Brexit and its potential implications,andbelow-trendgrowthandinflation.

Economic Risk Political Risk Financial System Risk

Country Risk Tier 1 (CRT-1) Very Low Level of Country Risk

Country Risk Tier 2 (CRT-2) Low Level of Country Risk

Country Risk Tier 3 (CRT-3) Moderate Level of Country Risk

Country Risk Tier 4 (CRT-4) High Level of Country Risk

Country Risk Tier 5(CRT-5)VeryHighLevelofCountryRisk

United KingdomCRT-1August 22, 2018Region: EuropeCountry Risk Criteria ProceduresGuide to Best’s Country Risk Tiers•TheCountryRiskTier(CRT)reflectsA.M.Best’s

assessment of three categories of risk: Economic, Political, and Financial System Risk.

•The United Kingdom (UK) is a CRT-1 country, with very low levelsofeconomic,political,andfinancialsystemrisk.

•Economic and political uncertainty following the referendum vote to leave the European Union continues to dampen growth prospects in the UK. Real GDP in 2017 grew 1.8%. Economic growth forecasts vary widely, depending on the manner and terms by which the UK exits the EU. However, medium-term economic growth is expected to be between 1.0% and 2.0%.

•A.M.Bestcategorizesthemajorityofcountriespicturedinthe map as CRT-1 and CRT-2. Notable exceptions are the Eastern European countries of Bosnia and Herzegovina, Belarus, and Ukraine.

BEST’S COUNTRY RISK REPORT

Economic Risk: Very Low•TheUKhasaservice-basedandwelldiversifiedeconomy.

Services account for 80% of GDP.

•Uncertainty surrounding Brexit pervades the economy. Growth in 2017 was positive but subdued, at 1.8%, and is expected to remain muted in the short term. Given the unpredictability of Brexit’s ultimate outcome, investment has also slowed.

•The EU is one of the UK’s primary trading partners, with exports to the EU accounting for almost half of its trade. Thus,BrexitposessignificantriskfortheUK’sexports.Retaining strong trading ties with the EU after it formally leaves will mitigate economic risk.

•InflationasofJuly2018was2.4%.TheBankofEnglandraiseditsbaselendingrateby25basispointsonAugust1,2018,inanefforttomoveinflationclosertoits2%targetrange, sustain growth, and encourage employment.

Political Risk: Very Low•Prime Minister Theresa May is attempting to negotiate

the Brexit process, but her center-right conservative party controls only a minority position in Parliament. As a result, Mayenteredintoa“confidenceandsupplydeal”withtheDemocratic Unionist Party (DUP) under which Northern Ireland receives additional funding in exchange for the DUP’s support on important legislation.

•The government will focus on negotiating the exit terms of Brexitandloweringthefiscaldeficitovertheshortterm.

•Despite the risks associated with Brexit, the UK remains a business-friendly environment with an effective legal system, well established property rights, and low corporate taxes. In the World Bank’s Ease of Doing Business Index, the UK ranked highly, at 7 out of 190 economies.

•Terrorist risks are elevated. Over the past three years, the United Kingdom has suffered a number of terrorist attacks.

Financial System Risk: Very Low•The Prudential Regulation Authority of the Bank of Englandregulatesthefinancialservicesindustry,includinginsurance.

•TheUK’sfinancialsectorisaninternationallyrecognizedhub, with assets valued at 10 times GDP.

•Capital buffer requirements have been increased to secure banking sector stability. Global tightening of monetary policy, uncertainty surrounding Brexit, and rising trade tensionscouldallbedisruptivetothefinancialsystemoverthe near to medium term.

•According to the Bank of England’s June 2018 Financial Stability Report, household and corporate debt in the UK remain below 2008 highs, credit growth remains in line with overall GDP growth, and debt-servicing burdens are low. One area of concern would be the rapid expansion of non-bank lending to riskier companies.

Economic Growth (%)

-5

-4

-3

-2

-1

0

1

2

3

4

5

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

Real GDP CPI Inflation

Source: IMF World Economic Outlook and A.M. Best

Political Risk SummaryScore1(best)to5(worst)

0

1

2

3

4

5International Transactions

Policy

Monetary Policy

Fiscal Policy

Business Environment

Labor FlexibilityGovernment Stability

Social Stability

Regional Stability

Legal System

United KingdomWorld Average

Source: A.M. Best

United Kingdom

GDP Per Capita and Population

0

10

20

30

40

50

60

70

80

90

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

United Kingdom

France Germany Ireland Italy Spain

USD

Millions

GDP Per Capita Population

Source: IMF and A.M. Best

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BEST’S COUNTRY RISK REPORT

Page 2 of 2 August 22 2018