Table of ContentSummary 4A – Business and Performance 7A.1 Business 8A.2 Underwriting Performance 11A.3 Investment Performance 16A.4 Performance of Other Activities 18A.5 Any Other Information 18B – System of Governance 19B.1 General Information on the System of Governance 20B.2 Fit and Proper Requirements 25B.3 Risk Management System Including the Own Risk and Solvency Assessment 26B.4 Internal Control System 34B.5 Compliance Function 35B.6 Internal Audit Function 36B.7 Actuarial Function 37B.8 Outsourcing 38B.9 Any Other Information 39C – Risk Profile 40C.1 Underwriting Risk 42C.2 Market Risk 48C.3 Credit Risk 52C.4 Liquidity Risk 53C.5 Operational Risk 54C.6 Other Material Risks 55C.7 Any Other Information 55VIG Re / Solvency Financial Condition Report 20202

D – Valuation for Solvency Purposes 56D.1 Assets 57D.2 Technical Provisions 61D.3 Other Liabilities 70D.4 Alternative Methods for Valuation 72D.5 Any Other Information 72E – Capital Management 73E.1 Own Funds 74E.2 Solvency Capital Requirement and Minimum Capital Requirement 77E.3 Use of the Duration-Based Equity Risk Sub-Module in the Calculation of the SolvencyCapital Requirement 79E.4 Differences between the Standard Formula and Any Internal Model Used 79E.5 Non-Compliance with the Minimum Capital Requirement and Non-Compliancewith the Solvency Capital Requirement 82E.6 Any Other Information 82ABBREVIATIONS 83LIST OF TABLES 84LIST OF FIGURES 85ANNEXES 86Annex I – Organisational Structure as of 31 December 2020 86Annex II – Quantitative Information 87VIG Re / Solvency Financial Condition Report 20203

SummaryThe purpose of Solvency Financial Condition Report (hereinafter “the Report”) is to respond to the publicdisclosure requirements as defined by the Solvency II Regulation. The elements of the disclosure relate tobusiness performance, governance, risk profile, solvency and capital management.VIG RE zajišťovna, a.s. (hereinafter also “VIG Re” or “the Company” is a member of Vienna Insurance Group(“VIG”) and was incorporated on 18 August 2008 after receiving the license to carry out reinsurance businessand related activities on 8 August 2008. It has its registered office at Templová 747/5, Prague 1 and conductsreinsurance business in Property and Casualty, Life and Health lines of business since 2009.VIG Re is responsible for managing the Group reinsurance programs of Vienna Insurance Group but has alsoestablished itself as a leading reinsurance Company in Central & Eastern Europe beyond the boundaries ofVIG Group. With a nimble and lean operating model, the Company meets the demand of clients looking fora partner who has an in-depth market know how and builds on long-term relationship. The commitmentto a long-term partnership approach equally holds for the Company’s undertakings in other ContinentalEuropean markets, where the company focuses on insurance clients who share the same values and whohave a profound track record as stable and reliable partner. The establishment of the two branch offices inFrankfurt in 2017 and in Paris in 2018 underpins the commitment to client proximity.VIG Re adheres to a prudent risk management policy, especially in the areas of underwriting discipline,a conservative investment policy and reinsurance protection. In combination with a strong capitalposition, its operating model and the ability to offer broad risk solutions across all main lines of business,the Company is well positioned to seize opportunities in its Central and Eastern core markets and beyond.Business and PerformanceIn line with the Company strategy, gross written premium increased in 2020 to EUR 579 million in 2020,a 10% increase compared to 2019. The P&C business segment contributed with EUR 524 million, Health withEUR 28 million and Life with EUR 26 million.In 2020 VIG Re delivered a profit before tax of EUR 23 million. The combined ratio for the period was 96.9%,exceeding 2019 by 0.9 percentage points. The underwriting result in 2020 was impacted by COVID-19losses in gross amount of almost EUR 20 million, but significantly reduced by VIG Re own retrocessionprogrammes.Investment result was impaired by negative FX revaluation of assets held against liabilities in respectiveforeign currencies, such as the depreciation of Turkish Lira and various CEE currencies.The Company’s business activities per material lines of business and regions are in Chapter A.VIG Re / Solvency Financial Condition Report 20204

System of GovernanceThe Company’s system of governance is defined through internal guidelines and proceduresand encompasses integral elements, such as an integrated risk management system, the internal controlsystem and the four key functions (actuarial function, compliance function, risk management function,internal audit function).Continuous improvement of the risk management and steering as well as a high integration of riskconsiderations in the planning, business and decision-making processes throughout the Company isparamount to VIG Re’s Risk Strategy.An integral element which combines the quantitative and qualitative risk management results andthe strategic and business planning is the forward-looking Own Risk and Solvency Assessment (ORSA)as an important element in the integrated planning process and impacting the strategic and businessdecisions-making in the VIG Re management processes.Persons who effectively run the Company, key function holders and persons with material impact onthe Company’s risk profile are fit and proper for their positions. The remuneration system is in accordancewith Solvency II Regulation and the Company’s business and risk strategy.Changes in the composition of Supervisory Board and Board of Directors and the overall system ofgovernance during the year 2020 are commented in Chapter B.Risk ProfileAssumed Reinsurance being the core activity of the Company, underwriting risk is the most significant riskcategory for VIG Re. The Company is especially exposed to Non-Life underwriting risk and to a moderateextent to Life and Health underwriting risk. Underwriting risk is managed through the adherence toa prudent underwriting policy, including the application of underwriting limits, a strict accumulationcontrol, and is further mitigated by a prudent retrocession program. The Company uses a Partial InternalModel for Non-life Underwriting risk and Health NSLT Underwriting risk.Market risk is governed by VIG Re’s Investment Strategy which sets a balanced risk/return-profile andlimits for asset allocation. To manage counterparty default risk VIG Re distributes its reinsurance protectionprograms over a diversified panel of financially solid reinsurance companies, in compliance with VIGSecurity Guidelines. In the area of operational risk, procedures, controls and emergency plans areas are inplace to ensure sustainable reinsurance services.The Solvency Capital Requirement increased from EUR 110 million in 2019 to EUR 125 million in 2020. Most ofrisk modules increased as a result of the Company’s portfolio growth. In addition, the newly implementedtax law in Czech Republic reduced the Loss-Absorbing capacity of deferred taxes.Detailed information for VIG Re’s risk profile and its key procedures of risk mitigation is provided inChapter C.VIG Re / Solvency Financial Condition Report 20205

Valuation for Solvency PurposesThe valuation of assets and liabilities for Solvency II purposes is performed on a fair value (market value)basis. In case IFRS values appropriately reflect the fair value, these are used for Solvency purposes aswell. Chapter D further elaborates on the main differences between statutory reports according to IFRSstandards and Solvency II valuation separately for each item. The differences are stemming mainly fromtechnical provisions and reinsurance recoverables as well as from valuation of deposits to cedants andinvestments (especially held to maturity bond portfolio).Capital ManagementThe Company’s own funds comprises the ordinary share capital, the share premium, the reconciliationreserve and subordinated liabilities. Eligible own funds amount in 2020 to EUR 246 million, up byEUR 3.5 million compared to last year.The Solvency ratio for 2020 is 197%. The Solvency ratio includes the foreseeable dividend payment forthe financial year 2020 and takes into consideration the full implementation of the new tax law in CzechRepublic affecting the Loss-Absorbing capacity of deferred taxes.The Solvency Financial Condition Report 2020 was approved by the Board of Directors on 7th of April 2021.Sums and percentages calculations may include minor deviations due to rounding effects.VIG Re / Solvency Financial Condition Report 20206


A.1 BusinessA.1.1 Name and Legal Form of the UndertakingVIG RE zajišťovna, a.s. is the company incorporated in the Czech Republic in the form of a joint-stockcompany, registered in the Commercial Register maintained with the Municipal Court in Prague,file no. B 14560 and with dentification no. 28445589 (hereinafter the “Company” or “VIG Re”).The address of the registered office and official webpage is as follows:Templová 747/5110 01 Prague 1Czech Report covers VIG Re on a solo basis.The Company has a licence to pursue the following activities:Reinsurance activity under § 3 paragraph 1, lett. (l) of Act No. 277/2009 Coll. Insurance Act, as amended(hereinafter the “Insurance Act”), within all branches of life insurance listed in Appendix 1 of the InsuranceAct, Part A and all non-life insurance branches listed in Appendix 1 of the Insurance Act, Part B.Activities related to reinsurance activities under the Insurance Act:investigation of reinsurance events;mediation activities undertaken in connection with reinsurance activities;consulting services related to reinsurance;educational activities for reinsurance intermediaries and independent assessors of reinsurance events.The above mentioned activities were performed by the Company as of the date of this Report. Performanceof these activities was not limited or suspended by the Czech National Bank during the vesting period.VIG Re / Solvency Financial Condition Report 20208

Underwriting TerritoriesFigure 1 - Underwriting TerritoriesFigure 1 shows the underwriting territories from which the Company assumes reinsurance contractsin 2020. These would include most Continental European countries as well as Japan and South Korea.A.1.2 Name of the Supervisory Authority Responsible for the Financial Supervisionof the Undertaking and GroupThe Company is subject to supervision by Česká národní banka (Czech National Bank). Česká národní bankacan be contacted at:Na Příkopě 28115 03 PragueCzech Republicwww.cnb.czThe Company is a member of the VIENNA INSURANCE GROUP AG Wiener Versicherung Gruppe whichis subject to supervisory authority by the Finanzmarktaufsicht in Österreich (Austrian Financial MarketAuthority), which can be contacted at:Otto Wagner Platz 51090 ViennaAustriawww.fma.gv.atVIG Re / Solvency Financial Condition Report 20209

A.1.3 External Auditor of the UndertakingThe statutory auditor of the Company is:KPMG Česká republika Audit, s.r.o.Pobřežní 648/1a186 00 Praha 8Czech Holders of Qualifying Holdings in the UndertakingTable 1 - Shareholders of the UndertakingLegal FormAddressShareCapitalShare ofVotingRightsVIENNA INSURANCE GROUP AGWiener Versicherung Gruppejoint-stock companySchottenring 30, 1010 Wien55%55%Donau Versicherung AG ViennaInsurance Groupjoint-stock companySchottenring 15, 1010 Wien10%10%Kooperativa pojišťovna, a.s.,Vienna Insurance Groupjoint-stock companyPobřežní 665/21, 186 00 Praha 810%10%Kooperativa poisťovňa, a.s.Vienna Insurance Groupjoint-stock company Štefanovičova 4, 816 23 Bratislava10%10%WIENER STÄDTISCHEVersicherung AG ViennaInsurance Groupjoint-stock company15%15%Business NameSchottenring 30, 1010 WienA.1.5 Legal StructureVIG Re is a member of VIENNA INSURANCE GROUP AG Wiener Versicherung Gruppe. Detailed list of relatedparties is available in Annual Report of the Company under Annex 2 to the Report on Related Parties.In line with its strategic focus on Continental European reinsurance markets, the Company establisheda branch office in Frankfurt am Main, Germany, in September 2017 and in Paris, France, in November 2018.The economic data of the branches are, in accordance with the legislation of the Czech Republic, an integralpart of the financial statements of the Company.VIG Re has a subsidiary in Wiener Re a.d.o. Serbia, which was acquired from WIENER STÄDTISCHEVersicherung AG Vienna Insurance Group. Wiener Re is a reinsurance company based in Belgrade andis currently active in Serbia and the neighbouring countries Bosnia and Herzegovina, Montenegro andMacedonia.VIG Re has also share in VIG FUND, a.s. The company operates in the area of real estate management.VIG Re / Solvency Financial Condition Report 202010

Table 2 - VIG Re Shares 2020Legal FormAddressShare CapitalShare of VotingRightsWiener Re a.d.o. Serbiajoint-stock companyTrešnjinog cveta 1,11070 Belgrade100%100%VIG FUND, a.sjoint-stock companyTemplová 747/5,110 00 Praha 12.75%2.75%Legal FormAddressShare CapitalShare of VotingRightsWiener Re a.d.o. Serbiajoint-stock companyTrešnjinog cveta 1,11070 Belgrade100%100%VIG FUND, a.sjoint-stock companyTemplová 747/5,110 00 Praha 12.63%2.63%Business NameTable 3 - VIG Re Shares 2019Business NameA.2 Underwriting PerformanceA.2.1 Underwriting Performance in 2020Economic EnvironmentAs consequence of the lockdown measures taken by the governments to cope with the COVID-19pandemics in 2020, most economies are facing an economic downturn. While for the European UnionEurostat forecasts the GDP in 2020 to fall by 6.8%, Central and Eastern European countries of the EU reporta more resilient development, with GDP reduction by an average of 4.2%. A more severe economic recessionand a sharp increase of unemployment rates has been so far prevented by distinct fiscal measures andmonetary policies. However, lower tax revenues and significantly elevated level of public sector spendingwill lead to consequential budget deficits and - in combination with the continued low interest environment- to an increased risk of inflation. In addition to this, financial markets and local currencies show a high levelof volatility, driven by the current uncertainty about a future duration and severity of the pandemics.Business Performance 2020Profit before tax for the year 2020 amounts to EUR 22.6 million, creating a shareholder return onShareholders’ equity of 9.3%. Combined ratio for the period was 96.9%, increased compared to 2019 by 0.9%percentage points.The underwriting result reached EUR 15.4 million, impacted by COVID-19 related losses (EUR 18.4 milliongross) and large fire losses of business reported by VIG Group companies. Net Combined Ratio for the periodis 96.9%. The investment result was affected by negative FX revaluation of assets held against liabilities inrespective foreign currencies, as the depreciation of Turkish Lira and various CEE currencies, accounting fora return from investment of 0.8% (2.5% in 2019).Administrative and other operating expenses amounted to EUR 12.1 million. Main expense categories arepersonal cost (56%), IT related costs (21%), outsourcing and consultancy (9%).VIG Re / Solvency Financial Condition Report 202011

Table 4 - Income Statement (in ‘000 EUR)2020Premiums written2019578 898527 477524 286478 096Life26 25723 499Health28 35525 88296.9%96.0%7 11214 642Property & CasualtyCombined ratio*Result from investmentsProfit before tax22 56026 242Profit for the period16 77020 803* Combined ratio is calculated for P&C and Health business segmentsReinsurance business assumed from insurance companies being member of VIG Group accountedfor EUR 345 million, 2% above 2019 level, which is 60% of the total gross written premium. Out of thisEUR 281 million referred to VIG Property and Casualty Treaty business. VIG Re closely cooperates withVIG holding and serves as a carrier that sets up Group wide reinsurance protection. Equally important isVIG Re’s role as preferred reinsurer for VIG companies when meeting their individual reinsurance needs.VIG Re participates on local Non-Life treaty cessions of VIG companies with an average share of 39%, strictlyadhering to arms-length principle.VIG Re’s portfolio continues to diversify in terms of client base, lines of business and distribution channels.As in previous years, the Company succeeded to further grow the business assumed from clients outside ofVIG Group.For Central and Eastern Europe, despite ongoing market consolidation and centralisation of reinsurancebuying of international insurance groups, the portfolio grew by 22% to EUR 51 million. Other non lifetreaty business underwritten from the Headquarter with clients outside of VIG Group includes SouthernEurope (Italy, Spain, Portugal), accounting for EUR 45 million ( 34%) and East Asia (Japan and SouthKorea), accounting for EUR 18 million ( 65%). The Facultative Property and Casualty Book grew by 5% toEUR 13 million.Business assumed by VIG Re’s branch in Germany, responsible for our non-life treaty business from clientsoutside of VIG Group in Germany, Austria and Switzerland grew by EUR 4 million to EUR 65 million. By end of2020 number of clients in the region grew to 75. Likewise for the French Branch Office, which serves clientsin France and Benelux, further inroads were made with prospect clients as well as existing ones, translatinginto a substantial growth of our portfolio and client base. The GWP grew by 56% to EUR 28 million. By end of2020 VIG Re was servicing 46 clients in the region.The Life and Health portfolio grew from EUR 49 million to EUR 55 million. Since 2020 VIG Re is responsible,for the Group wide life reinsurance protection, similar as for Property and Casualty.VIG Re / Solvency Financial Condition Report 202012

Figure 2 - GWP per Segment in (EUR ‘000)P&C524 286Health28 355Life26 257Figure 3 - GWP P&C per Line of Business (in EUR ‘000)PropertyMotor Third Party Liability 356 37785 795Motor Own Damage 35 175General Third Party Liability19 630Marine14 047Personal Accident13 182Figure 4 - GWP P&C per Country (in EUR ‘000)AustriaGermanyCzech RepublicItaly164 39451 29346 06442 353Poland31 914Turkey26 397France24 008Slovakia15 582Japan13 682Romania12 356Other*96 243*Other represents the following countries: Albania, Armenia, Azerbaijan,Belgium, Bosnia, Bulgaria, Croatia, Estonia, Georgia, Greece, Hungary,Kazakhstan, Kosovo, Latvia, Liechtenstein, Lithuania, Luxembourg,Macedonia, Moldova, Montenegro, Netherlands, Portugal, Russia, Serbia,Slovenia, South Korea, Spain, Switzerland, UkraineVIG Re / Solvency Financial Condition Report 202013

The underwriting result for 2020 and 2019 are summarized in the tables 5 and 6.Table 5 - IFRS Results of 2020 (in EUR ‘000)2019P&CLifeHealthTotal524 28626 25728 355578 898-204 479-8 284-1 828-214 591318 64418 13226 505363 28112 82962 836Claims incurred-215 599-10 629-8 857-235 085Operating expenses-98 603-5 589-11 480-115 672Underwriting result4 4424 7446 17415 360Premiums written - grossPremiums written - reinsurers' shareNet earned premiumsOther incomeTable 6 - IFRS Results of 2019 (in EUR ‘000)P&CLifeHealthTotalPremiums written - gross2018478 09623 49925 882527 477Premiums written - reinsurers' share-207 033-6 394-1 046-214 473267 51017 39924 708309 6172 82322 825Net earned premiumsOther incomeClaims incurred-192 515-11 386-9 461-213 362Operating expenses-71 868-5 762-6 793-84 422Underwriting result3 1273 0758 45614 658The underwriting result per geographical area and business segments for 2019 and 2020 is presented inthe tables 7 and 8:Table 7 - Underwriting Result per Segments 2020 (in EUR ‘000)Gross EarnedPremiumGross Claims& ngResult afterProportionalretrocessionP&C CEE & VIG331 815-278 39353 42364 587Branch Germany202065 434-66 121-687-503P&C SE45 118-47 470-2 352-2 352Branch France26 771-29 183-2 412-2 439P&C Asia17 237-17 07716016011 615-6 7104 9041 673Health52 616-52 163452-238Life26 312-21 1615 1504 818576 918-518 27858 64065 708P&C FacultativeTotalTotal Netunderwritingresult**15 360* Life “Gross Claims & Expenses Incurred” includes income from the cedants deposits.**After all retrocession. Including admin costs.VIG Re / Solvency Financial Condition Report 202014

Table 8 - Underwriting Result per Segments 2019 (in EUR ‘000)2019Gross EarnedPremiumGross Claims& ngResult afterProportionalretrocession315 240-231 79683 44484 251P&C CEE & VIGBranch Germany61 003-63 052-2 049-2 124Branch France & SE51 761-55 407-3 646-3 935P&C Asia9 889-25 071-15 182-15 182P&C Facultative9 956-4 1635 7934 199Health50 251-49 951300-249Life23 784-19 9743 810261Total521 885-449 41572 47067 221Total Netunderwritingresult**14 658* Life “Gross Claims & Expenses Incurred” includes income from the cedants deposits.**After all retrocession. Including admin costs.The underwriting result per significant line of business for 2019 and 2020 is presented in the tables 9 and 10:Table 9 - Underwriting Result per Solvency II Line of Business 2020 (in EUR ‘000)2020GrossEarnedPremiumGross Claims& ExpensesIncurredGrossUnderwritingResultNet UnderwritingTotal NetResult e and other damage to property197 590-213 995-16 405-11 465Non-proportional Property170 995-120 04950 94657 702Non-proportional Casualty58 022-45 67312 34911 926Other motor37 953-38 248-295-1 201Motor vehicle liability20 664-22 019-1 356-1 260Non-proportional health26 688-17 3189 3716 770Life reinsurance26 431-21 2085 2234 890Other38 575-39 769-1 194-1 654Total576 918-518 27858 64065 70815 360Table 10 - Underwriting Result per Solvency II Line of Business 2019 (in EUR

place to ensure sustainable reinsurance services . The valuation of assets and liabilities for Solvency II purposes is performed on a fair value (market value) basis. In case IFRS values appropriately reflect the fair value, these are used for Solvency purposes as . KPMG Česká republika Audit, s.r.o. Pobřežní 648/1a 186 00 Praha 8 .