Porto Seguro Investors News (58) - Auto Market Share 2Q18 and 1H18

Dear Investors,

Recently, the regulatory agency (Susep) has released Brazilian auto insurance results for June, 2018 and also for the first semester of 2018.

This year, the regulator changed the way of accounting, affecting earned premiums and expenses ratios.

The Initial Hiring Costs, which allowed an acceleration of earned premiums until December/2017, will be accrued as Deferred Acquisition Costs as of 1/1/2018, following the same appropriate system for the results according to the contract risk length (pro rata).

The consequence is a reduction of earned premiums, which led to an increase in loss ratio, other operational expenses and taxes. The exception is the G&A, which decreased mainly due to the offsetting of the equivalent part of the deferral, in order to balance the accounting. The impact in Porto Seguro is an increase of 2 p.p. in the loss ratio and a decrease of approximately 3 p.p. in G&A compared to the former rule.

Below the top player's results:

AUTO - 1H18 x 1H17

Market Share Market Share (Var. p.p.) Premiums Growth

AUTO - 2Q18 vs. 2Q17

Market Share Market Share (Var. p.p.) Premiums Growth

27,4%

0,1 4,5%

12,5%

0,0 4,0%

10,5%

1,8 26,2%

8,0%

0,3 8,8%

7,4%

0,5 12,4%

2,3%

-1,0 -28,1%

100,0%

- 4,1%

Insurer

Loss Ratio

Loss Ratio (Var. p.p.)

Porto Consolidated

27,8%

0,3

6,1%

54,3%

-4,7

Porto Seguro + Itaú Auto¹

19,3%

-0,3

3,2%

53,4%

-3,9

Mapfre + BB

12,5%

-0,1

4,4%

71,9%

2,2

Bradesco Auto/RE

11,1%

-1,2

-5,3%

61,9%

-3,6

Sulamérica

9,5%

0,9

15,8%

61,2%

-8,2

Tokio Marine

9,3%

0,7

14,0%

56,5%

-6,4

Azul Seguros

8,5%

0,6

13,3%

56,5%

-7,0

HDI

8,3%

0,2

6,9%

71,1%

-1,4

Liberty

7,5%

0,7

16,3%

58,2%

-5,6

Allianz

5,1%

0,2

8,2%

65,5%

-3,6

Sompo Seguros

2,4%

-1,1

-29,1%

64,1%

-5,9

Zurich

1,4%

-0,1

-4,7%

70,2%

-4,1

Market

-

-0,1

4,9%

61,5%

-3,9

Insurer

Loss Ratio

Loss Ratio (Var. p.p.)

Porto Consolidated

53,1%

-4,8

Porto Seguro + Itaú

52,1%

-3,9

Mapfre + BB

66,1%

-3,3

Bradesco Auto/RE

60,2%

-5,3

Sulamérica

60,4%

-7,7

Tokio Marine

54,0%

-8,9

Azul Seguros

55,5%

-7,2

HDI

69,4%

-2,5

Liberty

58,3%

-5,4

Allianz

65,2%

-2,9

Sompo Seguros

63,9%

-2,3

Zurich

65,7%

-6,5

Market

59,8%

-4,9

19,4%

-0,3 2,8%

12,0%

-1,1 -4,9%

8,7%

0,2 6,8%

7,7%

0,1 5,0%

4,9%

0,2 8,8%

1,2%

-0,3 -18,0%

¹ The Company started in the fourth quarter of 2016 the plan for migrating the auto polices issues from Itaú Auto e Residência to Porto Seguro Cia Company, which is now operating the brands Porto Seguro and Itaú Auto. The migration is going to be done gradually aiming to improve processes and systems synergy preserving both brands.

Kind Regards,

Relação com Investidores / Investor Relations - Tel.: (+55) 11 - 2393-7092 Porto Seguro -http://www.portoseguro.com.br

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Porto Seguro SA published this content on 28 September 2018 and is solely responsible for the information contained herein. Distributed by Public, unedited and unaltered, on 28 September 2018 20:31:01 UTC