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A Growing Specialty Insurer

A Growing Specialty Insurer

March 2023

A Growing Specialty Insurer

• Canadian specialty lines franchise operating for 16 years

Diversified

•

US hybrid fronting platform participating in the admitted and non-admitted ('E&S') markets

Specialty Platform

• Earnings supported by an attractive mix of underwriting income and recurring fee-based and investment income

• Conservative Debt-to-capital1 below our internal target (20%) and capital in excess of regulatory requirements in subsidiaries

Strong Balance Sheet

• Issuer rating of BBB (DBRS); Financial Strength ratings of A (low) (DBRS) and A- (AM Best) at operating subsidiaries

•

20% consolidated 2022 Adj. ROE1 (ROE: 6%); 5-year average 85% combined ratio1, 2 in Canada and 30% 2022 ROE;

and Profitability

increasing profitability from US subsidiary reaching a 14% 2022 Adj. ROE3 (ROE: -12%)

• Conservative approach to reserving; consistent history of favourable prior year claims development

• 5-year GPW CAGR of 75%2 (38%2, 4 in Canada, 86%2, 4 in US)

Growth

• Growth supported by expanding distribution relationships in existing lines of business and growth of our hybrid fronting

Opportunities

model in Canada and US

• Proven access to capital (raised $276 million in equity & $75 million in debt) and reinsurance relationships to support growth

• High quality investment portfolio comprised primarily of cash (34%), government bonds (7%), and corporate fixed

income (43%)

Conservative Risk

•

Conservative underwriting culture; limited retention in US and 5-year average loss ratio of 22%1, 2 in Canada

Management

• Disciplined reinsurance strategy; deep relationships with high-quality counterparties - 83% of reinsurance recoverable

are with rated reinsurers, the remaining 17% from unrated reinsurers with appropriate collateral

• Strong enterprise risk management infrastructure in place

Experienced

• Management team with a diversity of skills, and strong relationships with regulators and distribution partners; senior

Management

management directly owns ~6% of shares outstanding

& Board of Directors

• Board of Directors comprised of seasoned executives with strong experience across financial services

Specialty Insurer Targeting Mid-teens ROEs and Growth in Book Value

Note: All figures in C$ million unless otherwise stated.

1 This is a supplementary financial measure. Refer to Q4 2022 MD&A, Section 10, Operating Metrics table for its composition. To access MD&A, see Trisura's

1

website or SEDAR at www.sedar.com. 2 As of December 31st, 2022.

3 Adjusted figures exclude impact of Write Down on Reinsurance Recoverable in Q4 2022. 4 5-year CAGR in Canada, 3-year CAGR in US.

Company Overview

  • Trisura Group Ltd. (TSX: TSU) is a specialty insurer operating in the surety, risk solutions, corporate insurance and fronting market segments
  • Trisura operates in niche markets, relying on specialized underwriting knowledge and structuring expertise to offer commercial products and services not provided by most insurers
  • Components of Trisura were founded and incubated within Brookfield Asset Management; Canadian specialty insurance in 2006 and US fronting in 2017 prior to spin-out

Canada

US
  • 16-yearoperating history in surety, risk solutions and corporate insurance segments; strong track record of profitable underwriting
  • 2022 GPW: $731 million
  • 2022 Net Income: $55 million, 30% ROE
  • DBRS Rating: A (Low)
  • A.M. Best Rating: A- (Excellent) Size 9

Key Performance Metrics

  • Hybrid fronting business that works with distribution partners and cedes majority of risk to reinsurance markets
  • 2022 GPW: $1.7 billion
  • 2022 Adj. Net Income1: $34 million (Net Income: -30 million), 14% Adj.
    ROE1 (ROE: -12%)
  • DBRS Rating: A (Low)
  • A.M. Best Rating: A- (Excellent) Size 9

$1.4 billion2 Market Cap

$483 million

Q4/22

Book Value

$2.4 billion 2022 GPW

$83 million

Adj. Net Income3

(Net Income: $25 million)

20%

Adj. ROE (ROE: 6%)

13.4%

Q4/22

Debt-to-Capital

+58% Since

Year-end 2020

+35% Y/Y

+56% Y/Y

+34% Y/Y

1pts Y/Y

-4pts Y/Y

Established Canadian Specialty Platform and Growing US Fronting Business

Note: All figures in C$ million unless otherwise stated.

  • Adjusted figures exclude impact of Write Down on Reinsurance Recoverable in Q4 2022.

2 As at March 20th, 2023.

2
  • This is a supplementary financial measure. Refer to Q4 2022 MD&A, Section 10, Operating Metrics table for its composition. To access MD&A, see Trisura's website or SEDAR at www.sedar.com.

Key Achievements

Share Price Performance1 and GPW Growth ($ millions)

Trisura

TSX Financials

S&P/TSX

Consolidated LTM GPW

$2,433 / +1,491%

388%

22%

$153 17%

Key Achievements

  • June - December 2017: Completed spin-off from Brookfield, developed public company infrastructure and US capabilities
  • May - December 2018: Enhanced corporate governance and risk management functions through dedicated board committees and personnel
  • December 2018: Finalized internalization of investment function across all three subsidiaries
  • September 2019: Completed inaugural equity raise of $58 million
  • November 2019: Closed the acquisition of 21st Century Preferred Insurance Company, providing access to admitted markets in the US
  • May 2020: Completed $68 million equity raise and increased capacity on revolving credit facility to $50 million
  • June - July 2021: Completed $75 million senior unsecured notes offering and executed a four-for-one common share split
    January - April 2022: Advanced various Environmental, Social & Governance initiatives, including the implementation of a Sustainability Linked Loan and
  • Responsible Investment Policy, and enhanced related disclosure within the Management Information Circular and Management Discussion and Analysis
  • July 2022: Completed $150 million equity raise
  • September 2022: Closed the acquisition of Sovereign Insurance's surety business in Canada

Note: All figures in C$ million unless otherwise stated.

3

1

Cumulative share price performance measured from close of business December 31st, 2017.

2

'Current' as at March 20th, 2023.

Strategic Priorities

  • Expand North American insurance market share through enhanced distribution and capacity relationships
  • Build fronting model of scale in US and Canadian markets

Growth

  • Grow Admitted business and obtain US Treasury listing
  • Evaluate strategic partnerships and inorganic growth
  • Demonstrate the value of specialty focus through strong loss ratio and underwriting margin outperformance

Profitability

• Leverage fixed cost base and technology to gain scale, demonstrating sustainable mid-teens ROE

• Diversify earnings to produce stable returns

• Maintain and improve ratings and appropriate regulatory capital

Risk & Capital

• Synchronize risk management across the platform

Management

• Optimize capital allocation, reflecting appropriate capitalization for insurance, credit and market risks

• Enhance yield and increase allocation to alternatives; maintain appropriate risk profile and improve diversification

Investments /

• Develop track record of execution, expand shareholder base and distribution partners

Capital Markets

• Strengthen access to capital and enhance ability to fund growth

Centralized Corporate Function Providing Support for Operating Subsidiaries to Grow

4

Disclaimer

Trisura Group Ltd. published this content on 23 March 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 23 March 2023 12:19:55 UTC.

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