2019 OMIA Annual Report : simplebooklet.com

2019 General Meetings Annual Convention Sheraton Hotel Toronto March 20 22 2019 OMIA Chair Brad Vanstone welcomed delegates to OMIA s 137th Annual General Meeting and Convention the Ontario Mutual Insurance Association for the year ended December 31 2018 be adopted as presented Brad s theme for the year was Embracing Youth Technology and he spoke on the importance of working together as mutuals He provided his thoughts on the need to focus on policyholders and support our communities and he also spoke to our unique opportunity to use loss prevention to enhance policyholder relationships Moved by Doug Crockett Westminster Mutual During the opening of the convention the Hon Lisa Thompson MPP for Huron Bruce and Minister of Education brought greetings from the Premier of Ontario noting the value that mutuals provide for policyholders She also noted that the property and casualty insurance sector is a key employer in the Canadian economy and has created and will continue to create many job opportunities Amanda Lindhout provided the convention s opening keynote address She shared the harrowing details of her kidnapping as a foreign journalist and her subsequent captivity Today she focuses on helping others see the opportunities to grow after pain and difficulty Her message resonated as a call to action in developing personal resiliency Brad Vanstone OMIA Chair 2018 2019 John Taylor reported on OMIA s activities in 2018 and provided a recap of a difficult year for insurers in both underwriting and investment He also spoke to a hardening market as price corrections took hold throughout the industry While these price increases are necessary for financial sustainability they also create public relations challenges and underline the importance of working with policyholders to maintain stability and sound underwriting As has become tradition the Farm Mutual Foundation auction provided a lively conclusion to convention events with both a silent and live auction Another single event fundraising record was reached OMIA Treasurer Sharon Dittmer provided a report to delegates including financial statements The following motions were brought forward 1 Approval of the Minutes of the 2018 Annual General Meeting THAT the Minutes of the Annual General Meeting of the Ontario Mutual Insurance Association as held March 22 2018 be approved Moved by Jacquie Bishop Howick Mutual Seconded by Allan Sheppard HTM Insurance Company Carried 2 Financial Auditors Report THAT the Financial Report and Auditors Report for 4 Seconded by John Scriver Dufferin Mutual Carried 3 Appointment of Auditors THAT Clarke Starke and Diegel be appointed auditors for the Ontario Mutual Insurance Association for the year 2019 Moved by Annette Winter Halwell Mutual Seconded by Dan Burns West Wawanosh Mutual Carried 4 Election of Directors at Large Bob Burley as Acting Chair of the meeting reviewed the OMIA process for the election of Directors at Large He noted the work of the Nominating Committee and confirmed that the sole candidates meeting all qualifications for the two Director at Large positions were Brad Vanstone of West Wawanosh Mutual and Neil Shay of Caradoc Townsend Mutual THAT Brad Vanstone and Neil Shay be elected by acclamation Moved by Harold Meadows Cayuga Mutual Seconded by Sandy McIntyre North Blenheim Mutual Carried In addition to the Director at Large positions Tracy Wintermute of Westminster Mutual was welcomed as the incoming Group A Director Outgoing Chair Christine Van Daele was thanked for her tireless service to the OMIA Board and numerous committees during her time as an OMIA Director The Presidential Merit Award was presented to Catherine MacLellan in recognition of her service and advocacy on mutual solvency and oversight Brian Glass and Dan Hill accepted the Outstanding Contributor Award on behalf of Germania Mutual In the afternoon delegates participated in concurrent educational sessions that explored Marketing AI Resiliency Young Mutual Employee Perspectives Flood and Barn Fires At the end of the convention Bob Burley assumed the role of Chair of the OMIA Board and Bob s theme for the year was Three P s in a Pod Policyholders People Profit 2 0 1 9 O N TA R I O M U T U A L I N S U R A N C E A S S O C I AT I O N A N N U A L R E P O R T

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2019 General Meetings Chair Bob Burley welcomed delegates to Ottawa for the first P M held there since 2012 Presidents Managers Meeting Delegates were also welcomed by the Hon Rob Black an Independent Senator from Ontario with deeps roots in Canada s agricultural sector and rural communities Westin Hotel Ottawa October 27 29 2019 Opening keynote speaker Dr Greg Wells drew a clear connection between wellbeing and health individual performance and organizational success The business session included reports from Chair Bob Burley and OMIA President John Taylor Bob highlighted OMIA s work over the course of the year and reflected on his theme Three P s in a Pod Policyholders People Profit and the importance of each to mutual sustainability John Taylor highlighted the work of many of OMIA s technical committees and provided updates on the potential for Ontario automobile insurance reform and the implementation of IFRS 17 John also identified many key partnerships that OMIA has established to assist all mutuals in supporting key causes There was an update on OMIA educational developments in 2019 including the introduction of a one day Innovation Workshop and the launch of a Young Mutual Leaders Forum Bob Burley OMIA Chair 2019 2020 John added a special welcome to OMIA s newest associate subsidiary member Collectivfide Policyholders People Pro t The 2019 President Managers meeting took place over three beautiful autumn days that showcased scenic Parliament Hill and the Ottawa River Chair Neil Petreny convened the Fire Mutuals Guarantee Fund business meeting He reviewed 2019 activities including recruiting and selecting two new members to the Financial Review Committee Joanne Vansevenant and Rick Walters He also confirmed that no member companies currently posed a solvency risk to the fund Neil also had the opportunity to thank retiring Financial Review Committee members Chuck Andrews and Phil Haynes for their service over the past decade and to present them with a retiring gift Catherine MacLellan provided a report on 2019 results to the end of Q2 These results were an improvement on 2018 however underwriting continued to remain a challenge Rob Rice of Middlesex Mutual provided an update on the work of the Credit Score Working Group which has looked at developing a framework for the use of credit score by individual mutuals The focus has been on practical elements and tactics Kurtis Andrews a lawyer who is one of the leading thinkers on the emerging issue of animal activism and trespass provided an update on some of the troubling developments with increased animal activism on farms Koker Christensen partner at Fasken LLP provided an update on open banking and its implications for the financial services sector James Temple of PwC spoke on developing board diversity Among his key themes was the need to ensure that diversity also includes collegiality open thinking and the elimination of unconscious bias The final presentation of the day was provided by Tony Ngo of Collectivfide previously known as the Broker Acquisition Study Group Tuesday morning kicked off with a presentation from the Canadian Mutual Leadership Task Force The group provided insight on some key risk areas that have been identified by the external scan radar group Farm Mutual Re Director Jill Taylor provided her annual report as Chair of the Farm Mutual Foundation Farm Mutual Re held an information session which included addresses by Chair Tom Oegema CEO JP Gagnon CFO Amy Butler Assistant Vice President Loss Control Ryan Jones Assistant Vice President Claims Lisa Fazzari and VP Reinsurance Kevin Cameron In the afternoon Dr Linda Duxbury of Carleton University provided an educational and entertaining session on putting people in strategy She focused on the demographic challenges for the workforce in Canada the underlying trends for recruitment and succession and the unique characteristics each generation brings to the workplace At its core the presentation focused on the need to ensure organizational strategy clearly incorporates an organization s people profile Our closing keynote Graham Sherman provided a highenergy address to delegates on his experience as a startup entrepreneur with Toolshed Brewing He shared his insights on how even as a very small competitor in Alberta s brewing industry his company s foundation and eventual success was based on the spirit of collaboration and a common touch with consumers We look forward to our 2020 meeting the first of a new decade in London Ontario 2 0 1 9 O N TA R I O M U T U A L I N S U R A N C E A S S O C I AT I O N A N N U A L R E P O R T 5

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2019 Committee Reports Accounting Advisory Committee Report Members The OMIA Membership has a long tradition of working together to achieve goals develop strategies and make meaningful contributions to mutuality This system provides the membership with a voice in Association activities and also helps provide a cost effective platform for accomplishing more together The following pages provide a summary of the important work done over the past year on your behalf Chair Andrea Schaefer Hay Mutual Christine Van Daele Westminster Dave Paterson Ayr Traci Radford West Wawanosh Kevin Konecny Kent Essex Bob Nielson The Commonwell Catherine MacLellan Financial Review Committee Bob Brown Farm Mutual Re Amy Butler Farm Mutual Re Sharon Dittmer OMIA Susan Baker OMIA OUR MANDATE is to assist member companies in meeting requirements for audit and financial reporting COMMITTEE FOCUS The Accounting Advisory Committee monitors and contributes to dialogue on many issues including International Financial Reporting Standards IFRS changes to the statutory financial reporting forms required by the regulators requirements of the General Insurance Statistical Agency GISA tax both federal and provincial essentially any topic where the information required must be delivered to or extracted from the member company accounting and financial systems The committee forms a link between the Regulatory Review Committee where many of these requirements first come to light the Financial Review Committee and the Accountants Roundtable The Roundtable is composed of those at member company staff and management who are responsible for financial reporting and compliance The committee also works closely with the Financial Review Committee in reviewing changes to solvency rules such as revised MCT calculations This collaborative approach helps ensure that the implications of changes are understood and implemented consistently In 2019 much of the committee focus has been in developing an implementation process for IFRS 17 IFRS 17 GETTING READY In April 2018 the Accounting Advisory Committee launched a Gap Analysis Project with Ernst Young E Y The committee elected to undertake this gap analysis as a 6 precursor to developing more detailed implementation plans Partnering with E Y on the gap analysis process also provided some insight into the mandatory actuarial work that will be required under IFRS 17 in addition to the changes in accounting policies processes and reporting The gap analysis focused on looking at current mutual accounting policies and actuarial practices and compared these against what s anticipated under IFRS 17 The general categories reviewed were as follows Systems Models Policy Process Reporting Once gaps were identified they were then categorized as being either minor or critical in nature IFRS 17 has introduced new terminology and definitions around items such as level of policy aggregation onerous contracts liability for incurred claims and liability for remaining coverage Many of our old familiar ledger and balance sheet accounts such as unearned premium will disappear from our financial reports IFRS 17 will completely change financial reporting and the Accounting Advisory Committee have identified an opportunity to recommend standardization of accounting treatments and approaches to financial reporting among the mutuals 2 0 1 9 O N TA R I O M U T U A L I N S U R A N C E A S S O C I AT I O N A N N U A L R E P O R T

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Accounting treatments and policies Chart of accounts Accounting for reinsurance premium and proceeds Guideline on level of aggregation by a coverage line Guidelines on identifying onerous contracts pportunities for aggregated approaches to financial O data for actuarial discounting ecommendations on accounting for policy R acquisition costs hared resources for management and board S training on IFRS 17 Shared resources for actuarial services In late 2018 it was announced that IFRS 17 would be delayed by one year and currently has a target effective date of January 1 2022 Implementation will be required earlier in order to create comparative statements for the 2022 fiscal year Auto Rate Filing Committee Report Chair Kevin Inglis Howick Mutual During 2019 the committee continued to work on IFRS17 readiness One key project was formalizing a model for accessing group actuarial services This was a priority project given the increased scrutiny and requirements under IFRS 17 for actuarial input and sign off for financial statements The committee is currently working on developing position papers to be shared with mutuals participating in the group actuarial services project In work to date the Accounting Advisory Committee has included representatives from policy management system programmers in order to provide some indication on what system changes may be required for financial reporting The committee will also be working closely with mutual auditors to ensure decisions are acceptable to our audit partners Looking ahead into 2020 the committee is working with three companies as test companies to ensure that the actuary will be able to access the data they require to provide the required actuarial services under IFRS 17 The Financial Review Committee also plays a critical role in IFRS 17 readiness and their contributions to the committee and the Accountants Roundtable provide valuable insight to the potential impact on regulatory reporting and solvency examination Members In the next phase of IFRS 17 readiness the Accounting Advisory Committee working with mutual auditors and other service providers such as E Y will continue to develop recommended wording and approaches such as Jason Cybulski BCM Henry Miller North Kent Steve Quinn Cayuga Tracy MacDonald Trillium Jodi Meiering Ayr Sharon Turnbull Farm Mutual Re Laura Ni Farm Mutual Re Jeff Ferguson OMIA Christine Senior OMIA OUR MANDATE is to lead member companies in working together to create a sustainable and profitable auto product offered at competitive rates to meet the unique needs of mutual policyholders BACKGROUND The Auto Rate Filing Committee ARFC represents the group of OMIA companies that underwrite automobile insurance in Ontario and have elected to do a common filing with the Financial Services Regulatory Authority FSRA This approach is a successful example of mutuals working together to pool expertise and leadership create economies of scale and make decisions in the best interest of member companies and policyholders The Committee identified six Critical Success Factors to achieve the mission 1 U nderwriting Appetite and Marketing responsive and flexible underwriting criteria and supporting marketing to attract quality customers 2 Product Offering differentiated product within the regulated environment 3 Agile Pricing actuarially sound sophisticated pricing methodology 4 Portfolio Management customer level underwriting practices combined with member company monitoring of performance Continued on the next page 2 0 1 9 O N TA R I O M U T U A L I N S U R A N C E A S S O C I AT I O N A N N U A L R E P O R T 7

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5 Claims Discipline consistent claims reserving and settlement practices 6 Operational Efficiencies forward thinking and efficient processes STRATEGIC DIRECTIONS 1 Committee responsibility and awareness education and communication Enhance connection between committee members and stakeholders i e constituency model Skills and experience based matrix to balance committee Research and recommend product enhancement and differentiation 2 Advanced targeted GLM create profitable and competitive auto pricing for our mutuals Re examine segmentation strategy Manage dislocation Orientation and training on GLM Communication strategy Data collection enhancement strategy 3 Grass Roots Inputs increased two way communication Effectively capture member input Ensure committee s strategies are aligned with member mutuals Use Manager s Conference forum for key message delivery Communicate to membership the types of decisions the committee has to make 4 Customer centric Develop deeper understanding of policyholder needs Ensure that pricing rating data strategy does not preclude implementing self serve model for policyholders at a future point PROJECTS AND RATE FILINGS The committee has been engaged in providing direction on projects in development at Farm Mutual Re and OMIA At the direction of the committee a number of rate filings have been completed and several others are planned Each filing is focused on the strategic priorities of Underwriting Appetite Marketing and Agile Pricing to implement required rate reductions while enhancing the product offered by member companies The automobile portfolio is diligently monitored 8 With the new regulatory environment promoting more flexibility and innovation and the hard market and marketplace activity the ARFC is planning on increasing the number of Private Passenger Automobile Reviews from semi annually to quarterly Date Actions June 2019 Private Passenger full GLM 0 0 October 2019 Private Passenger 3 5 February 2020 Commercial 0 updates to rate groups February 2020 Private Passenger 4 8 Upcoming Dates Actions June 2020 Private Passenger 0 0 this filing has not received final approval July 2020 Miscellaneous August 2020 Private Passenger manual refresh October 2020 Commercial November 2020 Private Passenger GLM PROJECT GENERALIZED LINEAR MODELLING In June 2019 members of the shared auto filing successfully moved to the best practise rating methodology of Generalized Linear Modelling Several new rating elements were introduced with the intent on pricing optimization with a focus on improving performance and competitiveness while reducing adverse selection Early in 2020 the model underwent a full refresh introducing two new rating variables to ensure we continue improving rate segmentation to charge the right price for each risk LOOKING AHEAD FSRA has established itself as the new provincial regulater for P C insurance Pieces of FSRA s mandate include encouraging innovation responding to market changes quickly and fostering a sustainable competitive financial service sector They are also fostering an environment of more frequent file and use rate filings This will force the ARFC and our system vendors to move more quickly and be more responsive to changing market conditions OMIA and Farm Mutual Re represented the mutual community in FSRA s Regulatory Rate Advisory Group and helped shape the new simplified standard rate filing process We took advantage of the new Standard filing with our February Private Passenger rate review to further increase rates in response to our competitive positioning Auto insurance will likely remain close to the surface of political discussion over the next 12 months and we hope to continue to collaborate with FSRA to represent the mutual community 2 0 1 9 O N TA R I O M U T U A L I N S U R A N C E A S S O C I AT I O N A N N U A L R E P O R T

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Members Automobile Insurance Committee Report Chair Terry Knight North Blenheim Mutual Frank Montgomery North Kent Cheryl Gillet Town Country Kelly Jackson Westminster Linda Pereira Lambton Jon Hodson Farm Mutual Re Lisa Fazzari Farm Mutual Re John Taylor OMIA Susan Baker OMIA OUR MANDATE is to develop OMIA s position on auto insurance issues and communicate that position to the appropriate legislative and regulatory authorities BACKGROUND The Automobile Insurance Committee provides formal input to government consultations on potential changes to Ontario s automobile insurance product In reforms dating back over 25 years virtually every part of the Ontario automobile insurance environment has been affected often radically by changes to either statute or regulation Each of these changes has required detailed study and comment from the insurance industry including OMIA Many of the initial reforms in the 1990s focused on enrichment of statutory accident schedule benefits and creating more stringent claims handling regulations The Ontario auto insurance system has often been described as being similar to a social safety net Over time this has created a very generous insurance product with benefits that exceed those of any other jurisdiction in Canada In addition the complexity of the rules governing the product have created an extremely complex environment for both insurers and policyholders The creation of a generous and complex auto insurance system has led to the increasing involvement of legal counsel on behalf of policyholders and an adversarial environment for auto claims 2019 was a very active year for the government on the auto insurance front PUTTING DRIVERS FIRST A BLUEPRINT FOR ONTARIO S AUTO INSURANCE SYSTEM The government began the year with a consumer survey in January This simple on line survey included a handful of questions and generated 50 000 responses In summarizing the responses the Ministry of Finance indicated that most consumers felt that automobile insurance was too expensive should be available in a more convenient fashion and was difficult to understand These conclusions were not surprising to the Auto Insurance Committee Following the consultation the Spring Budget Speech referenced a wide range of high level initiatives aimed at tackling affordability convenience and consumer choice Some of the areas identified in this blueprint can be summarized as follows Overhauling the licensing system for health service providers Reforming the flawed medical assessment process to increase credibility and accountability Reviewing contingency fee transparency Introducing strong anti fraud measures Establishing a modern online claims process for consumers to increase convenience and reduce fraud Facilitating electronic communication insurers and policyholders Allowing auto insurers to offer drivers more choices in terms of discount and coverage options to improve policy affordability Creating a Driver Care Plan which would include a Driver Care Card to streamline access to treatment Implementing a Care Not Cash default clause to eliminate cash settlements on first party injury claims Returning to a default benefit limit of 2 million for catastrophically injured individuals between The Ministry of Finance held a stakeholder s information session in May touching on many of these high level objectives and providing some timelines for consultations on 2019 priority items The first two priority consultations were identified as a Driver Care Card Online Claims Portal Consultation and a Medical Assessment Reform Consultation In addition the Ministry signaled that the long awaited introduction of the electronic pink slips would be taking place imminently Continued on the next page 2 0 1 9 O N TA R I O M U T U A L I N S U R A N C E A S S O C I AT I O N A N N U A L R E P O R T 9

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Driver Care Card Online Claims Portal Consultation Cost Reduction Consultation This consultation was convened in late June and OMIA was invited to appoint a member to the small stakeholder group Frank Montgomery of North Kent Mutual a longstanding member of the Auto Insurance Committee took part as the mutual representative Discussions centered on how electronic access to the claims process could best be provided to policyholders From an overview standpoint OMIA s position on the Driver Care Card was to ensure that it remained a relatively straightforward approach to digital access and that the cost of creating a Driver Care Card or an Online Claims Portal should be considered against the actual benefit to policyholders This is particularly true where many policyholders may lack access to broadband internet or may not be likely to use a digital interface Nonetheless the creation of a policyholder friendly digital claims environment should be a positive step forward for all parties The Ministry of Finance also convened a consultation group looking at areas where costs can be removed from the system for the benefit of policyholders At the time this report was written this committee had discussed several areas but there has been no further indication on direction A final report had not been received by year end By year end 2019 there was a growing sense that the provincial government may be looking at making reforms to automobile insurance sooner rather than later Those reforms would be consistent with the government s previously stated focus on improving convenience and affordability for auto insurance consumers Medical Assessment Reform OMIA selected Linda Pereira of Lambton Mutual to participate in this consultation and provide a mutual viewpoint on the challenges in the current medical assessment process For many years the adversarial nature of the medical assessment process has created unwarranted cost burdens for insurers and policyholders alike The current assessment process has been routinely criticized by virtually all stakeholders OMIA supports a system where medical assessments are undertaken on a truly independent basis and provide credible information and opinion to assist in the recovery process for accident victims Achieving this result will require a process where medical assessments are deemed credible by all parties and are given a level of deference by adjudicators when claims go to dispute A final report had not been received by year end 10 The insurance industry will continue to try and advance meaningful discussions on how to provide increased consumer choice on accident benefit coverages continuing to promote a Care Not Cash philosophy to eliminate cash settlement options unless specifically purchased at the outset of the policy by the insured and looking for opportunities to promote evidence based treatment regimens to make sure policyholders are receiving prompt care based on scientific evidence to promote early recovery LOOKING AHEAD Nonetheless there was still considerable uncertainty as to which proposals might move forward into law As we move into 2020 the Financial Services Regulatory Authority FSRA is now fully established and has identified as a key priority supporting the Ministry of Finance in any auto reform program The areas FSRA have to tackle include streamlining the existing claims processes and developing an environment for automobile insurance product innovation Further impetus to potential change in 2020 is generally declining automobile results Automobile insurance profitability is suffering nationally and Ontario shares in this overall deterioration much of it driven by adverse development on previous years claims and the rapidly escalating cost of physical damage repair to automobiles due to increasingly expensive technology 2 0 1 9 O N TA R I O M U T U A L I N S U R A N C E A S S O C I AT I O N A N N U A L R E P O R T

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Benefits Committee Report Chair Steve Quinn Cayuga Mutual Jeff Howell Bay of Quinte Teresa Martin North Blenheim Terrye Calnan HTM Tracy Wintermute Westminster Jennifer Allan Farm Mutual Re Sharon Dittmer OMIA John Taylor OMIA OUR MANDATE is to provide guidance on issues related to employee benefit programs and company benefit programs that are available to the Membership through OMIA The following chart summarizes the participation level in OMIA programs as at January 1 2020 Employees Life package Life LTD AD D Individuals Companies 1 094 42 Short Term Disability 101 4 Critical Illness 845 27 Directors Life 177 25 Dependent Life Employees 926 42 Dependent Life Directors 163 25 Directors AD D 287 37 120 179 870 6 8 27 1 169 41 Pension Defined Benefit Defined Contribution 452 609 32 33 Directors Officers 0 42 0 1 1 669 40 271 40 0 30 Health Dental Plan A Basic Plan B Basic Major Plan C Basic Major Child Ortho TOTAL Health Dental with ICPP Directors Officers without ICPP Bond E O P C Agents Cyber Liability anticipated liabilities of the Plan The second phase of the study looked at the design of the Plan from the standpoint of how pensions are earned by beneficiaries and funded A report on the work to date along with suggested changes to Plan design was provided to member companies in the fall of 2018 and information sessions were held in December 2018 OMIA requested input from members on the potential changes early in 2019 Overall the purpose of the study has been to investigate ways to reduce the volatility of the contribution requirement from employers and find ways to best manage or ideally reduce contribution risk in the future In 2019 the OMIA board elected to make the following changes to the OMIA Defined Benefit Pension Plan effective January 1 2022 1 The DB pension formula will change to 1 5 x credited service x final average earnings for future service only 2 The monthly employee and employer contributions will increase to 9 3 The indexing cap will decrease to 3 In June 2019 all companies participating in the Defined Benefit Pension Plan received a report on the OMIA Board s decision with respect to the changes listed above In September of 2019 an employee announcement detailing the plan changes was sent to all participating members of the Defined Benefit Pension Plan In November of 2019 a legal notice of upcoming pension plan changes was distributed to all participating active members of the Defined Benefit Pension Plan PENSION PLAN Pension Plan Text Asset Liability Modelling and Plan Design Changes In 2018 four amendments were filed with FSRA Two of the amendments have since been approved and two of the amendments are still waiting for approval by FSRA The two outstanding amendments are company specific and administrative in nature In addition Morneau Shepell the actuary is developing the Plan text changes that will be needed with respect to the Plan design changes The Plan has undergone an asset liability modeling ALM study to assess the sustainability and expected trends in Plan funding requirements over the longer term This study projects varied economic scenarios forward on a ten year basis The initial scope of this study was to determine how efficiently the assets in the Plan were matched against the Continued on the next page 2 0 1 9 O N TA R I O M U T U A L I N S U R A N C E A S S O C I AT I O N A N N U A L R E P O R T 11

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Annual Plan Review Defined Benefit Plan This review is completed by OMIA as Plan Administrator and Morneau Shepell as Plan Actuary The annual plan review ensures that the OMIA Plan is compliant with both statute and regulations relating to pension plans in Ontario It also provides a formal review of governance practices to measure the Plan s policies and processes against best practices in the pension field Member companies were provided with written confirmation of the OMIA Plan s compliance in September 2019 Stewardship Review Defined Contribution Plan OMIA as Plan Administrator and Great West Life as Plan Manager reviewed the Defined Contribution Plan for stewardship and compliance The OMIA Board approved the Stewardship Report late in 2019 This report provided feedback to OMIA on the design of the Plan and the services available to employees in the Defined Contribution Plan as compared to pension industry trends and best practices Pension Valuation January 1 2018 marked the end of the most recent annual valuation period for the OMIA Pension Plan The OMIA Board of Directors elected to file an early valuation due to the significant improvement to the funded position of the plan based on the guidance and interest rate environment the Plan membership information as of January 1 2018 and various other actuarial assumptions and rates in the Plan s position and legislative changes with respect to funding of pension plans Results of that valuation revealed a small surplus on a solvency basis thereby cancelling the second and third payment of the 2016 valuation The next mandated valuation is required for the period ending January 1 2021 The January 1 2018 valuation also indicated a required increase to the employer contribution rate effective January 1 2018 monitors the ASO target reserve The committee reviewed the target set in 2019 and recommended increasing the current target level over the next five years Some of the items and trends of interest this year have been The Employee Family Assistance Program EFAP continues to be well utilized by members The program provides employees and their families with support in times of need The program is completely confidential Overall Health and Dental claims costs continue to rise This is consistent with industry trends and the Benefits Committee closely monitors this trend and potential methods to reduce claims costs while still providing a competitive benefits package OMIA continues to use the ASO reserve to offset increased claims costs Health and Wellness education continues to be a major focus through wellness newsletters and by providing information on lifestyle choices that promote long term health Accidental Death and Dismemberment Insurance On January 1 2019 the following enhancements were made to the AD D coverage for employees and directors in the event of an AD D claim Bereavement Benefit Conversion Option Day Care Benefit Hospital Indemnity Benefit In addition the maximum amounts for the following benefits were increased in the event of an AD D claim Family Transportation Benefit Home Alteration and Vehicle Modification Benefit EMPLOYEE BENEFITS Identification Benefit Health and Dental Coverage Rehabilitation Benefit The OMIA Health and Dental Plan operates under an ASO Administrative Services Only model Repatriation Benefit In an ASO model participating companies essentially selfinsure and fund claims through direct premium assessment to member companies Services to administer claims under the plan are purchased from a life and health insurer This model provides the most cost effective basis for the benefit plan while also ensuring claims are adjudicated at arm slength on a confidential basis Optional Life and CI Campaign The committee monitors the ASO claims experience history changes in participation levels and claims utilization data The committee also provides input on benefits issues that are brought forward by member companies and 12 Spousal Retraining Benefit Late in 2018 Sun Life offered members currently enrolled in the Life Insurance an open enrollment period for Optional Life and Optional Critical Illness The following coverages and limits were made available to members without medical evidence who applied before December 15 2018 O ptional Life the first 50 000 of coverage for members and 10 000 for a spouse and dependent children 2 0 1 9 O N TA R I O M U T U A L I N S U R A N C E A S S O C I AT I O N A N N U A L R E P O R T

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O ptional Critical Illness Insurance the first 25 000 of coverage for members and 20 000 for dependent children Please note the optional coverage is only available to individuals under age 65 An additional 44 members took advantage of the offer Member Company Visits OMIA is available to visit members companies to present on employee benefit and or pension at no cost to your company Companies wishing to have a presentation should contact benefits omia com COMPANY BENEFITS Agents Errors and Omissions The Agents Errors and Omissions program renewed with no increase in premium rates in 2019 In 2019 the insurer included Crisis Management Coverage at no additional cost Please refer to the E O renewal mailout from June 2019 for complete details Directors and Officers Insurance The Directors and Officers Insurance continues to be well utilized with 43 companies participating in 2019 In relation to Errors and Omissions and Directors and Officers Insurance we have asked our broker to determine if there is any merit in coordinating under one carrier but to date this has not been a viable option taking into consideration the current product features available under our existing programs Cyber Liability Insurance Cyber Liability Insurance was introduced late in 2015 Currently 30 companies have added this coverage and we anticipate more companies will consider this coverage in the future In 2019 a new Cyber ERM policy was introduced The Cyber ERM policy is designed to address the evolving regulatory legal and cyber security standards In addition a new short form application was introduced for those companies renewing their coverage Companies were offered a 10 reduction in renewal premium provided there are no significant changes or prior incidents ongoing claims OMIA will continue to share policies and templates on cyber protection and security measures as they are developed Implementing and documenting these measures is a key factor in being eligible for the more comprehensive levels of coverage available through Chubb information on all aspects of compensation benefits and related employment terms for employees agents and directors It provides excellent benchmarking at minimal cost to those taking part The next survey will take place in 2021 HR ROUNDTABLE The Association provides members the opportunity to participate in an HR Roundtable that is held twice a year in Cambridge The HR Roundtable provides education and discussions on HR trends and challenges Over the last couple of years topics covered at the HR Roundtable included mandatory health and safety training mental health in the workplace corporate wellness programs the Employee Family Assistance Program EFAP employment terminations employee orientation onboarding and completing pay equity assessments In 2019 OMIA offered a Mental Health Leadership Certificate program in conjunction with Morneau Shepell and Queens University which consisted of one full day session and three online modules OMIA WEBSITE Some key features of the OMIA Member s website include the ability to send a secure message directly to the OMIA Benefits Department without going over the worldwide web a library of application forms HR document samples HR manual samples company administration manuals for benefits and pension HR Leadership Forum newsletters prior mailouts and links to various government and benefit carrier websites In 2018 the OMIA Benefits Department updated the Company Administration Manuals for Benefits and Pension Both manuals can be found on the OMIA Member s website www omia com under Member Resources Information for HR Administrators LOOKING AHEAD The Benefits Committee monitors and provides guidance on issues relating to programs that are currently offered In late 2014 the Committee held a strategic planning session that established priorities to address member needs over the coming years Three primary strategies were identified Evaluating and enhancing plan user knowledge of the benefits program Providing cost effective labour market competitive benefit plans for member mutuals COMPENSATION AND BENEFITS SURVEY The bi annual Compensation and Benefits Survey was completed in 2019 and results were shared among participating companies prior to September 30 2019 A total of 45 companies participated This report contains Upgrading OMIA s current benefit software to improve efficiency adopt best practices and meet data reporting requirements These strategies have been incorporated into the OMIA Strategic plan 2 0 1 9 O N TA R I O M U T U A L I N S U R A N C E A S S O C I AT I O N A N N U A L R E P O R T 13

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Data Strategy Committee Report Chair Neil Shay Caradoc Townsend Mutual Alec Harmer HTM Shelagh Cleary Usborne Hibbert Tracy Campbell Germania Garth Driedger My Mutual Gary Anderson Nova Sharon Turnbull Farm Mutual Re Shawn Zhang OMIA Jeff Ferguson OMIA OUR VISION Better Data Better Decisions Knowledge Beyond Intuition OUR MISSION To facilitate data driven decision making The Data Strategy Committee is comprised of representatives from member companies using each of the different computer systems in place in the mutual system This ensures the committee is aware of the potential scope and effect of its decisions on statistical reporting requirements STRATEGIC PRIORITIES The committee engages in strategic planning and oversight on data related issues Our current strategic priorities are listed below and form part of OMIA s overall strategic plan 1 Increase member company knowledge and appreciation of the value of data Communicate through company visits conventions OM News training and roundtables 2 Develop framework for sourcing and governing data sources related to aggregated OMIA database Enhanced data collection Use of 3rd party data Working to provide predictive analytic capabilities across all lines of business 3 Improve data utilization and analysis Improvements to OMIA suite of statistical software and hardware Improvements to business intelligence solutions 4 Enable member company efficiencies on data collection and reporting 14 In 2020 and beyond Farm Mutual Re will continue to pursue analytic capabilities Peril Scores The objective is to provide an integrated solution that works in conjunction with the members current rating philosophy to bring about more sophisticated rating methodologies In future years this could evolve to include multivariate rating capability incorporating credit scoring Improving Rating for Agriculture Risks The objective is to gain an appreciation of the agriculture data that is available glean insights and improve rating methodology In future years this could evolve in other lines of business In 2020 and beyond OMIA will continue to pursue improvements to data quality and regulatory data requirements Improving Data Quality Ongoing enhancements to OMIA s editcheck software Working closely with system vendors to identify frontend data quality issues and improvements Work to eliminate any manual reporting Regulatory Data Requirements Look for alternate methods of capturing data to bring efficiencies to member company reporting Supporting FMGF group based approach to actuarial discounting under IFRS 17 2 0 1 9 O N TA R I O M U T U A L I N S U R A N C E A S S O C I AT I O N A N N U A L R E P O R T

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Education Committee Report Chair Steve Quinn Cayuga Mutual Jerrod Boyse South Easthope Dan Hill Germania Rob Pearson Town Country Michelle Spoelstra Nova Elizabeth Baker Farm Mutual Re Susan Baker OMIA OUR MANDATE is to determine the courses that OMIA will provide and to deal with other issues related to training TRAINING INFORMATION TRANSFER AN IMPORTANT SERVICE AREA OMIA s Strategic Plan recognizes the work of the Education Committee as a key strategic priority of our Resource Centre strategic goal Our committee is attentive of our responsibility to move information out to member companies in an effective and timely manner Knowledge is shared through the collaborative efforts of OMIA and Farm Mutual Re teams as well as staff from member companies Topics cover the full gambit of insurance related subjects human resources issues regulatory requirements and information technology support We appreciate the generosity of member companies in supporting their staff as roundtable chairs and knowledge providers CERTIFICATE PROGRAMS OMIA administers certification programs for member company directors and virtually every professional insurance discipline During the final months of 2019 we updated our Insurance Practitioner Certification Program Knowledge units will be delivered through roundtable stand alone live and live on line sessions During 2020 we will resume providing the opportunity for member company staff and directors to earn Leadership and Advanced Leadership Certificates through the University of Waterloo s Centre for Extended Learning 2020 EDUCATION PROGRAM An as known list of 2020 training events is posted on the following page and on the members website From time to time new opportunities to share information present themselves which require changes to the calendar In support of the upcoming change to how the financial status of insurance companies is reported we continue to support education on IFRS 17 standards leveraging the challenging work being done by the Accounting Advisory Committee Risk assessment and selection skills are critical in the business of insurance regardless of the insurance market conditions We will continue to create opportunities to explore the question Why do I care and demonstrate how our collective wisdom and common sense supports individual company results and Farm Mutual Re s Path to Profitability ON SITE MULTI LOCATION TRAINING OMIA is pleased to bring training programs to your company office Virtually anything we do in the training room can be replicated or modified to meet your particular need We appreciate member companies with large training meeting rooms providing us with access to these spaces when we hear from you that there is a need to share the information locally ONLINE REGISTRATION LEVERAGING ONLINE OPTIONS In mid 2019 we were able to provide member companies with the opportunity to register online for training sessions Thank you for embracing this change We have continued incorporating live online sessions presenter at one location participants at their locations recognizing that busy schedules sometimes stop member company staff and board members from attending sessions in Cambridge For one multi day program we are experimenting with holding the initial two days in person and the following sessions live online Early in October we released an Introduction to Privacy Legislation module that can be completed online Based on your response to this course we will continue to build a library of units to support your on boarding and training of staff and board members INNOVATION LEADERSHIP PROGRAMS IN 2019 In 2019 we contracted with third party providers and offered a program focused on Innovation August and a program focused on Young Leaders October Both programs were fully subscribed in short order and were well received We look forward to providing these or similar sessions in 2020 Continued on the next page 2 0 1 9 O N TA R I O M U T U A L I N S U R A N C E A S S O C I AT I O N A N N U A L R E P O R T 15

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UPGRADING THE AUDIO VISUAL TRANSMISSION FROM THE PINEBUSH ROAD TRAINING ROOMS We were fortunate during the summer of 2019 to have had the audio and visual equipment in the Pinebush Road training rooms upgraded This has resulted in an improved quality of sound being heard by those who are participating in sessions from a distance Session leaders and participants are gaining familiarity with the equipment with the expectation that we ll be able to make the experience the next best thing to being there 2020 EDUCATION CALENDAR Here is a listing of the 2020 education events The session dates are subject to change and additions will be made when opportunities present themselves Access the calender online at www omia com Education Education Calendar Date Course Date Course April 1 2 am Farm Liability Coverage Review Live Online July 9 April 2 Ethics in the Business of Insurance Live Online Residential Condominium Unit Owners Coverage Review July 14 Farm Property Coverage Review July 15 Commercial Property Coverage Review July 21 U of W Leadership or Advanced Leadership Course August 13 Making Presentations Ethics in the Business of Insurance Live Online April 7 8 am Commercial Liability Coverage Review Live Online April 14 Automobile Underwriters Roundtable April 15 Intro to Insurance the Mutual System April 16 Introduction to the Role of the Director September 10 am April 21 22 am Personal Liability Coverage Review Live Online September 10 pm April 22 pm HCAI Update The Role of the Audit Committee Management Discussion Analysis April 23 Auto Accident Benefits Claims Handling September 16 Insuring Farm Equipment April 28 29 Personal Lines Auto Insurance Level I September 17 Underwriting Managers Roundtable September 23 24 Sales Leadership Program May 4 am Commercial Auto Module I Live Online November 3 May 5 am Commercial Auto Module II Live Online September 29 Residential Underwriters Roundtable May 5 Board Chairs and Vice Chairs Roundtable October 6 Personal Liability Coverage Review May 7 am Commercial Auto Module III Live Online October 7 Farm Liability Coverage Review May 7 HR Roundtable October 14 Commercial Liability Coverage Review May 12 Underwriting Managers Roundtable October 14 Understanding Your Thermal Imaging Camera May 13 Regulatory Compliance Roundtable October 20 21 Accident Benefits Claims Handling May 14 Accountants Roundtable October 22 Automobile Underwriters Roundtable May 27 Agents Roundtable October 29 Accountants Roundtable May 28 Claims Managers Adjusters Roundtable November 5 HR Roundtable June 1 3 Managers Conference November 10 June 4 Chief Operating Officers Conference Commercial Farm Underwriters Roundtable June 9 Portfolio Management November 12 Claims Managers Adjusters Roundtable June 11 am HCAI System Update November 18 19 Ontario Mutual Loss Prevention League June 16 17 Ontario Mutual Loss Prevention League November 24 Regulatory Compliance Roundtable June 23 Commercial Farm Underwriters Roundtable November 26 Agents Roundtable December 1 Board Chairs Vice Chairs Roundtable June 24 Automobile Underwriters Roundtable December 3 Managers Roundtable June 25 Business Continuity Disaster Recovery 16 2 0 1 9 O N TA R I O M U T U A L I N S U R A N C E A S S O C I AT I O N A N N U A L R E P O R T

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Legislative Affairs Committee Report Chair Brad Vanstone West Wawanosh Mutual Allan Hedley Cayuga Doug Crockett Westminster Ross Lamont Trillium Barbara Bethune Nova Ed Forbes Farm Mutual Re John Taylor OMIA OUR MANDATE is to communicate the Association s position on legislative issues to our elected representatives LEGISLATIVE AFFAIRS AT OMIA Ontario Mutuals have a unique place in the property casualty landscape in Ontario This is most evident in our mutuals commitment to the economic health of rural Ontario local community causes and direct policyholder participation in mutual insurance This commitment is well recognized by the Ontario Legislature and MPPs see mutuals as an important part of a healthy and sustainable insurance system The Legislative Affairs delegate at each mutual plays an important role in maintaining our profile with MPPs and MPs Our delegates are ambassadors to the legislature and communicate effectively on the potential impact of proposed legislation Delegates provide feedback on how government policies relating to the insurance industry will affect policyholders particularly as related to the availability and affordability of insurance coverage in the communities we serve Legislative Affairs delegates are also expected to keep OMIA and fellow mutuals up to date on the important issues in their ridings that will have an impact either locally or provincially Delegates participate in two roundtables during the year The spring event takes place in early March with a visit to Queen s Park Our roundtable topics focus on areas of developing interest In addition to roundtables individual delegates are also expected to be active in attending local political events within their communities A successful and effective Legislative Affairs delegate has a keen interest in the democratic process a down to earth approach in communicating with MPPs and a sincere interest in promoting mutual insurance ROUNDTABLE SUMMARIES Spring 2019 On March 5 2019 committee chair Brad Vanstone welcomed 53 delegates to Toronto for our 6th Annual Queens Park Day and MPP Reception Our host sponsor for the day was the Hon Ernie Hardeman Minister of Agriculture Food and Rural Affairs and MPP for Oxford Our first guest was MPP Mike Schreiner leader of Ontario s Green Party and the first ever Green MPP in the Ontario Legislature having won the Guelph riding in June 2018 MPP Schreiner shared his perspective on the severity of weather events and the impact of climate change He noted Canadian insurers play a leading role in providing data that helps establish some of the impact of climate change and more frequent and severe weather events He also shared his platform on protecting farmland greenspace and water sheds He specially referenced his Private Members Bill to protect the Paris Galt Moraine In addition MPP Schreiner provided his thoughts on stewardship for Ontario s natural resources the impact of potential reforms on joint and several liability and the overall benefits of stewardship future food security and protection of the land Our second speaker was the Hon Ted Arnott Speaker of the House and MPP for Wellington Halton Hills A long serving member of the Legislature Speaker Arnott shared his thoughts on the privilege of acting as Speaker while balancing the need to strongly represent his constituents He emphasized the importance of neutrality and the role of the Speaker in maintaining house decorum and effective debate Speaker Arnott also shared the often underappreciated role of the Speaker in the management of the Legislative building staff and finances Our final speaker was MPP Doug Downey the Parliamentary Assistant to the Minister of Finance and the MPP for Barrie Springwater Oro Medonte MPP Downey brought greetings from Finance Minister the Hon Vic Fedeli He spoke on the importance of pre budget Continued on the next page 2 0 1 9 O N TA R I O M U T U A L I N S U R A N C E A S S O C I AT I O N A N N U A L R E P O R T 17

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consultation tours that had been held across the province and the Government s theme of working with business to increase employment opportunities He referenced the Government s red tape cutting initiative He also spoke specifically on the issue of automobile insurance and the potential for reform Mike Columbus provided an update on some recent municipal initiatives championed by the Association of Municipalities of Ontario including support for reforming joint and several liability and support for providing greater protection for farmers and landowners from trespass and activist related incursions Fall 2019 Bill 156 Security from Trespass and Protecting Food Safety Act The Legislative Affairs Roundtable met on September 4 in Cambridge with 37 delegates travelling from across the province Bobbi Ann Brady brought greetings on behalf of MPP Toby Barrett the Parliamentary Assistant to the Minister of the Agriculture Food and Rural Affairs She spoke on the recent change in structure at the Ministry of Finance with the addition of another Parliamentary Assistant to the Ministry As part of the roundtable an Agricultural Issues Panel focused on a major concern in the agricultural community animal activism and trespass on farms OMIA was honored to welcome panelists Crispin Colvin from the Ontario Federation of Agriculture Chantel Crockett from the Dairy Farmers of Ontario Katherine Fox from the Beef Farmers of Ontario and Mike Murdoch a former Crown Attorney The panel provided insight into the increasing hazard of animal activism and the concerns over the potential for injury and damage arising from illegal incursions by activists onto farms They reviewed some changes required to legislation to make enforcement of trespass more effective but perhaps more importantly shared their insight into effective risk management approaches to reducing the potential for confrontation with the activists These include contingency planning in the event of incursion but also proactive education and outreach programs to help citizens of Ontario understand the true nature of farming its importance to food security and the critically important economic benefits it provides to everyone in Ontario The roundtable also included a recap of some recent changes to the Ontario cabinet John Taylor reviewed core provincial issues for Ontario Mutuals including the potential reform of Ontario s automobile insurance legislation the ongoing need to strengthen the Ontario Building Code as related to ensuring weather resiliency is considered in the construction of all new buildings and the ongoing wish to see joint and several liability concepts modernized to protect municipalities and other large landowners against paying inequitable amounts towards legal settlements due to their financial position and access to liability coverage 18 In the fall of 2019 the Minister of Agriculture introduced Bill 156 to the legislature This was a long overdue and much hoped for statute to provide protection for farms agribusiness and farmers from trespass and animal activism There have been a number of high profile incidents in Ontario and the potential risk of property damage and personal injury arising from these confrontational activities was significant OMIA had an opportunity to support this legislation along with stakeholders in the agricultural sector The Bill received second reading at Queen s Park on December 10 2019 and the Minister s remarks in Hansard included the following the Ontario farm mutuals have been insuring farms and farm families for over 160 years As community based insurers we understand and value the importance of safety and risk management of our food supply and farms Farm incursions and trespass pose a significant risk to harm livestock food security farmers and farm property Bill 156 the Security from Trespass Protecting Food Safety Act provides basic protection against illegal activities and we support this commonsense approach to enhancing farm safety and food security As of the close of 2019 the Bill remained on the legislative docket and was anticipated to pass into law following legislative committee review and third reading LOOKING AHEAD The current government will approach its second year anniversary in June 2020 They ve had an active legislative agenda but with at least a couple of more years to go in their mandate we can expect 2020 to be just as active The Legislative Affairs Committee will continue to champion the perspective of rural Ontario and mutual insurers with Queen s Park 2 0 1 9 O N TA R I O M U T U A L I N S U R A N C E A S S O C I AT I O N A N N U A L R E P O R T

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Market Issues Committee Report Chair Marg Torrance Halwell Mutual Ed Forbes Dufferin Rob Moorehead McKillop Chris Hibbs Nova Christine Owens HTM Jeff Consitt Farm Mutual Re Sharon Turnbull Farm Mutual Re Susan Baker OMIA John Taylor OMIA OUR MANDATE is to gather and analyze industry market information that affects mutuals ability to sell their product and serve policyholders to disseminate this information to the mutuals and to connect with industry groups The committee relaunched their Market Watch bulletin This straightforward newsletter was designed for mutuals to share the information developed by the committee with a broad range of audiences including staff and board members Market Watch is designed to identify emerging issues and provide answers to what might this mean to my mutual MARKET WATCH Newsletter December 2019 December 2019 A periodic update to members on the work of OMIA s Market Issues Committee Mandate To gather and analyze information on industry trends that affect a mutual s ability to market their product and serve policyholders and to disseminate information to members and to connect with industry groups THE PATH TO PROFITABILITY Earlier this year JP Gagnon published a brief paper summarizing challenges in the property per risk category of business and the need to return property portfolios to profitability Fundamental to the profitability of any line of insurance is assigning an appropriate price to risk and selecting risks carefully based on your company s individual risk appetite In focusing on the property insurance environment in the property casualty industry we have seen a rapidly hardening market over the past 12 to 18 months About 18 months ago several of the large carriers elected to take remedial action to address declining profitability in their property portfolio Until that time there was a perception that market leaders would take any risk at any price in order to promote growth so this hardening market signaled a sharp turn toward insurance business fundamentals The August 2019 issue of Canadian Underwriter did a feature on Aviva Canada s financial turnaround The four business fundamentals identified by the CEO were rigorous underwriting technical pricing claims management and risk selection While this may seem like insurance 101 when combined with other market intelligence this is a crystal clear sign that there s room to increase premium to properly reflect property risk COMMITTEE MEMBERS Marg Torrance Halwell Ed Forbes Dufferin Rob Moorehead McKillop Chris Hibbs Nova Mutual Christine Owens HTM Mutual JP Gagnon Farm Mutual Re Jeff Consitt Farm Mutual Re Sharon Turnbull Farm Mutual Re John Taylor OMIA Susan Baker OMIA of 34 Page Page 11 of www omia com Member Resources Tools Market Watch In 2018 the Market Issues Committee refocused its mandate to become more proactive in publishing information to the membership on issues that most significantly impacted the ability of mutuals to sell their product and serve policyholders was the potential to introduce a Driver Care Card or an online claims portal for injury victims A dominant theme for the Market Issues Committee in 2019 was the continued hard market in property casualty insurance A hard market exists when insurers become risk averse more restrictive in risk selection and charge higher premiums for lines of business that have either shown a loss or declining profitability Based on the positive reception to the Market Watch newsletter the committee looks forward to further opportunities to introduce and lead discussion on topics of interest through Market Watch and through education sessions at the Presidents Managers Meeting the Managers Roundtable in December and the Annual Convention A hard market is particularly difficult for agents and brokers as they often take the brunt of the customer discontent that comes with rising premiums The underlying cause of the hard market has generally been poor loss results across almost all lines of business including auto residential property and commercial property For most insurers this was accompanied by poor investment returns in late 2018 The Market Issues Committee identified the difficulty many managers and leaders within the insurance industry including the mutual insurance industry had in dealing with this hard market Many individuals had no experience in a hard market because the last 15 years had been an essentially uninterrupted soft market Steve Smith the now retired President and CEO of Farm Mutual Re shared with member companies A Guide to Portfolio Underwriting and Acceptance This guide looked at commonsense approaches to evaluating a portfolio of business that is being remarketed The guide spurred discussions at the OMIA May Managers Conference and other venues in 2019 In addition the Market Issues Committee considered some of the impending changes to the Ontario automobile product The government position paper Putting Drivers First A Blueprint for Automobile Insurance in Ontario identified a range of initiatives some of which would have a direct impact on the consumer experience One of these Once again the Market Issues Committee had an opportunity to share their view of the government s blueprint through the Market Watch publication This committee has always been vigilant in monitoring consolidation of brokers and this has continued throughout 2019 with pressure from insurers buying brokerages large broker conglomerates expanding and with the influx of non traditional venture capital investment A smaller broker community creates fewer market opportunities and a bright spot in 2019 was the creation of the mutuals own broker acquisition company aimed at providing a mutual succession alternative for long standing mutual brokers The committee also studied developments in nontraditional insurance offerings digital platforms black box algorithms loss prevention applications and new entrants to the market LOOKING AHEAD The Market Issues Committee will continue to monitor the market environment and especially pricing and risk selection dynamics The committee will continue to sponsor and publish Market Watch to provide market insight and intelligence for a wide range of mutual readers In 2020 the committee has also identified with the Product Strategy Committee an opportunity to study together issues of common interest such as InsureTech and the sharing economy 2 0 1 9 O N TA R I O M U T U A L I N S U R A N C E A S S O C I AT I O N A N N U A L R E P O R T 19

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Marketing Committee Report Chair John Stirk Dufferin Mutual Morna Foan Grenville Tim Wade Westminster Jeff Holmes Ayr Deb Van Eyk Lambton John Taylor OMIA Lisa Hunter OMIA OUR MANDATE is to raise the profile of mutual insurance OUR VISION Standing as the foundation and support upon which each mutual can craft an individual voice while amplifying the strength of grassroots mutuality The committee continues to pursue a variety of marketing projects that communicate the advantages of mutuality to internal and external audiences As always we re guided by OMIA s Strategic Priorities and the needs of the membership PROMOTIONAL MATERIALS OMIA Marketing continues to support member companies with a variety of printed promotional materials including brochures information sheets posters advertisements and signs In 2019 OMIA collaborated with members on 56 product promotion requests and 27 custom advertisement requests targeting a variety of subjects We encourage you to contact marketing omia com to support your promotional strategy This service is part of your membership fee and you only pay the cost of printing and shipping MARKETING BOOKLET OMIA Marketing completed a marketing booklet in summer 2019 The booklet included information about various topics including marketing plans brand audience Google social media and video Each member company received a copy in the mail as well as an electronic link to share with staff www simplebooklet com marketingthemutualway This project supports the committee s strategic priority to identify emerging trends in marketing and communications and to provide tools to member companies to promote mutuality at the local level FARM SHOWS OMIA Marketing facilitated the Ontario Mutuals presence at the London Farm Show March 6 8 and the Ottawa Valley Farm Show March 12 14 Ontario Mutuals gained increased brand exposure through promotional bag sponsorship at the London Farm Show Continuing the trend Ontario Mutuals will now have exclusive naming rights of Hall A the largest and most visited event space at 20 the Ottawa Valley Farm Show We re excited for this new sponsorship relationship with the province s longest running agricultural tradeshow and look forward to maintaining a brand presence in eastern Ontario The Outdoor Farm Show took place in Woodstock from September 11 13 and the IPM in Verner West Nippissing from September 17 21 The Outdoor Farm Show booth was well attended and mutual participation was high IPM participation was lower however with the location cited as the biggest hindrance OMIA Marketing would like to thank Algoma Mutual Bay of Quinte Mutual HTM Insurance Trillium Mutual and West Elgin Mutual for their participation in the Ontario Mutuals tent We were also happy to host a local 4 H Ontario Club on the last day of the show The 2020 IPM will be later in the year and one day shorter taking place at the Lindsay Fairgrounds from October 14 17 OMIA s intention will be to strike the right balance between an Ontario Mutual staffed presence and increased brand awareness at the show BROKER CONVENTION The 2019 IBAO Convention took place from October 23 24 at the Sheraton Centre Hotel in Toronto OMIA facilitated an Ontario Mutuals booth in the trade show and an Ontario Mutuals hospitality suite which was hosted and funded by 10 participating mutuals We increased our exposure via sponsorship of the on site pocket program which included a logo feature on the Convention s mobile app We also submitted a full page ad in The Ontario Broker magazine on behalf of the hospitality participants The magazine is distributed to key industry players including brokers insurance executives IBAO sponsors MPPs and MPs The 2020 IBAO Convention will take place in Toronto from October 21 22 It s sure to be a big event as the IBAO is celebrating their 100th annual convention 2 0 1 9 O N TA R I O M U T U A L I N S U R A N C E A S S O C I AT I O N A N N U A L R E P O R T

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VIDEO PROJECTS Video footage was collected from a variety of mutual events over several months in 2019 The video crew provided some staged lifestyle footage and made additional efforts to capture a wide variety of Ontario landscapes The initial promotional video The Mutual Difference is slated for a March 2020 completion having been pushed back slightly due to video shoot rescheduling Once complete we encourage everyone to post it to their websites and social media channels Additional short videos will follow from the library of collected footage OMIA will begin to explore additional marketing platforms to expand the reach of this new promotional content MARKET RESEARCH The committee was presented with an opportunity to become involved in a market research project undertaken by PMG Intelligence a St Jacobs based firm dedicated to offering solutions to organizations in the financial sector The study will deliver strategic insights that provide a deeper understanding of the consumer purchasing process how a household connects insurance to other facets of their budget the triggers to switching beyond price and value proposition markers that will inform product technology distribution and marketing strategies PMG Intelligence will present their findings and discuss their insights at the 2020 OMIA Annual Convention KEY SPONSORSHIPS We continue to maintain relationships with key partners in the agricultural sector as part of our initiative to remain top of mind in this community Ontario Mutuals support the Ontario Plowmen s Association and the Ontario Queen of the Furrow Competition 4 H Ontario the Rural Ontario Institute ROI and the Advanced Agricultural Leadership Program AALP Farm and Food Care Ontario the Ontario Soil and Crop Improvement Association the Advancing Women in Agriculture Conference the FarmSmart and Southwest Ag Conferences We were happy to offer an increase in our 2019 and 2020 support of the Rural Ontario Institute and the AALP Once again we sent two students and one 4 H Ontario staff member to the Advancing Women in Agriculture Conference which took place in October We will also continue to offer support to the Fire Fighters Association of Ontario FFAO in their efforts to bring valuable resources training and education to their annual general meetings Our 2019 support of The Umbrella Project a Waterloobased initiative that aims to provide mental wellness programming to schools across the province brought the program to five schools Additional member companies took initiative to offer support to the schools in their local communities In 2020 Ontario Mutuals will fund an exciting new project offering mental health awards and scholarships to students educators and school communities We encourage you to visit www umbrellaproject co scholarship to learn more about the application process LOOKING AHEAD The marketing committee will continue to explore opportunities to promote the mutual difference through sponsorships events advertisements and digital avenues We look forward to gaining new insights into consumer behaviours and implementing strategies to complement an evolving marketing landscape Our focus Promote Mutuality Internally OM News Convention Support Promotional Projects Members Website Social Media Promote Ontario Mutuals Externally Member Project Support Ads Promotional Projects Website Social Media Tradeshows Sponsorships Ads Brochures Signs Banners Backdrops Brainstorming etc 2 0 1 9 O N TA R I O M U T U A L I N S U R A N C E A S S O C I AT I O N A N N U A L R E P O R T 21

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Product Strategy Committee Report Chair Terry Knight North Blenheim Mutual Pat Ryan The Commonwell Neil Shay Caradoc Townsend John Miller Mennonite Mutual AB Megan Rooney Dumfries Sonny D Agostino Farm Mutual Re Christine Meacher Farm Mutual Re Annette Dumbleton Farm Mutual Re Cynthia White Farm Mutual Re Susan Baker OMIA OUR MANDATE is to monitor insurance product trends and provide guidance and where appropriate direction to OMIA on the selection prioritization and delivery schedule of development projects to represent members interests by providing market intelligence and risk appetite continuums and to provide oversight of the product development process Providing member companies with the knowledge they need to inspect sell underwrite and adjust the inevitable claim are all part of the 360 vision we apply to our work of developing insurance coverage and supporting documents Product development requires a truly collaborative effort Member companies are well served in this sense by the contributions of a wide range of Cambridge and member company staff This includes the OMIA Insurance Services team Sue Baker Christine Senior Tammy Micallef Janet Schmidt Jennifer Higuchi and Carol Turkheim and staff from Farm Mutual Re Product Services Reinsurance Claims and Loss Prevention departments Member company staff provide input to the development process in a variety of ways from making the initial inquiry and reviewing coverage forms and supporting documents as a check for clarity and practical use at the company level COMPOSITION OF THE COMMITTEE The composition of the Product Strategy Committee is structured to provide an appreciation of member company perspectives from Eastern and Western Canada as well as Ontario from companies whose distribution system is broker driven and those that are agent driven and insurance professionals who look at insurance issues through a mix of underwriting sales and claims lenses IMPROVING YOUR ACCESS TO WHAT IS GOING ON The Product Strategy Committee s Action List is available for viewing by member company staff on the OMIA members website It is located in the Coverage Library section under each major line of coverage The list indicates the projects that are ongoing their expected completion date and the staff who are assigned to the project We encourage any of your staff with a particular interest in any of the projects to contact the OMIA staff assigned to the project or topic and give us the benefit of that experience 22 A PIVOTAL PIECE OF THE DEVELOPMENT AND UPDATING PROCESS The Product Strategy Committee is an important cog in the wheel of activity that surrounds the updating of existing coverage and supporting reference documents and the development of new coverage and supporting reference documents for member companies to use This committee meets online monthly and twice a year in person Each meeting includes a discussion of market issues involving both current and future looking topics a review of the Action List a review of projects that OMIA staff believe are ready to roll out and a discussion of requests and suggestions about coverage documents that have come from member companies We continue to evolve our oversight function so that we are tracking progress on the projects that member companies have identified as having significant importance to their business We also work on updating existing coverage and reference documents all while providing a member company s eye view of insurance market issues around coverage forms and observation of the activities of policyholders which may require an insurance response FORMS RELEASES The forms release webinars which follow the release of new and updated coverage documents underwriting risk selection guidelines or information pieces continue to be well attended by member company staff During the upcoming year we will be experimenting with recording short audio files that will contain an explanation of some new coverage documents Based on member feedback that indicated a need for access to just in time reviews of new insurance wordings the plan is to post these sound files with the print versions online We will be interested to hear our members feedback on the initial clips 2 0 1 9 O N TA R I O M U T U A L I N S U R A N C E A S S O C I AT I O N A N N U A L R E P O R T

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PROJECTS Since our report to the 2019 Annual General Meeting the Product Strategy Committee has overseen a variety of projects to completion A few examples of the updates are Unmanned Air Vehicles Coverage Supplemental Application Coverage Reference document Employers Liability Coverage Extension Coverage Reference document Workers Compensation Resource Table Farmers Accident Insurance Endorsement Coverage Reference document Rebuilding Cost Inflation Factors Personal Commercial Lines Joining Competiscan New forms and or coverage reference documents include First Party Basic Welding Cutting and Hot Works Warranty First Party Welding Cutting and Hot Works Warranty Coverage Reference document Cannabis Coverage Extension Endorsement for the Enclave high value Residential Policy Roof and Siding Limitation Endorsement residential farm commercial for all levels of coverage coverage reference document Support was provided for various Farm Mutual Re Product Services Reinsurance initiatives including Updated CGL Rate Pages 2020 Not for Profit Directors Officers Underwriting Guidelines Update The Committee continues to focus on improving the speed to market of products The challenge of course is to move quickly with development and at the same time get consensus on specific points from over 40 independent insurance companies We have had some challenges but remain committed to investing in the resources required to meet the demands WHAT IS UNDERWAY NOW As seen on the Product Strategy Committee Action List our oversight role on a variety of on going projects include Exploring the possibility of a partnership program for Legal Expense Coverage Exploring the possibility of a partnership program for Personal Cyber Insurance Coverage Develop a Non Stacking endorsement Update the Water Protection Endorsement Reference Document Update Loss of Income suite of coverages Update Builders Risk Coverage Update to Commercial Cyber Insurance Coverage Options Expansion of Farmers Accident Replacement Labour coverage Update coverage reference document for insuring craft wineries Create coverage reference documents for insuring craft breweries and cideries of Liability Limits As always in response to member company needs the Product Strategy Committee works with staff to respond to immediate market pressures as they arise 2 0 1 9 O N TA R I O M U T U A L I N S U R A N C E A S S O C I AT I O N A N N U A L R E P O R T 23

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Regulatory Review Committee Report Shawn Durnin Hay Jeff Whiting Ayr Chair John Stirk Bryan Hicks Trillium John Taylor OMIA Dufferin Mutual OUR MANDATE is to review regulatory issues that affect member companies The Regulatory Review Committee is the key liaison with insurance regulators including the Financial Services Regulatory Authority of Ontario FSRA Regulatory oversight is an active area for insurers provincially nationally and globally The areas of focus include solvency market conduct and governance Regulatory requirements continue to evolve in complexity and increasingly reflect international trends on financial regulation committee looking at next steps in modernizing Ontario s automobile rate filing regime 2019 A NEW REGULATOR TAKES FLIGHT Recognizing the ongoing importance of regulation and compliance for insurers and the specific challenges faced by smaller insurers OMIA has created a Regulatory Compliance Roundtable This educational opportunity will be open to all member companies and the group will focus on emerging and or challenging compliance issues This roundtable had previously focused on privacy but this expanded mandate will now allow a broader range of discussion and will generate helpful information and tools for mutual leadership teams On June 8 2019 the Financial Services Regulatory Authority FSRA officially assumed responsibility for the regulation of two predecessor entities the Financial Services Commission of Ontario FSCO and the Deposit Insurance Corporation of Ontario DICO In the year leading up to the FSRA launch OMIA worked with both FSCO and FSRA as priorities and responsibilities began to transition Part of this was meeting FSRA s new executive team ahead of the official start date of June 8 FSRA s Chief Executive Officer is Mark White Mr White spoke to the Presidents Managers meeting in Niagara Falls in October 2018 Other key FSRA senior leaders include Tim Bzowey Executive Vice President Auto Insurance Products Huston Loke Executive Vice President Market Conduct Guy Hubert Executive Vice President Credit Union and Prudential Glen Padassery Executive Vice President Policy Chief Consumer Officer Each of these individuals will lead departments within FSRA that will oversee and provide guidance to the property casualty insurers in Ontario FSRA will continue to carefully monitor the insurance environment and actively seek feedback from stakeholders like OMIA as issues arise relating to consumer protection and solvency In the interim OMIA had an opportunity to participate with FSRA s committee on regulatory fee structure and with a 24 OMIA also makes submissions on the behalf of the mutuals to other regulatory bodies including the Canadian Insurance Supervisors Regulatory Organization which is an umbrella group for all Canadian insurance regulators Comment was provided there on efforts to harmonize insurance licensing across the country Jackie Roy joined OMIA in July 2019 as our Regulatory and Compliance Resource Officer upon the retirement of longtime OMIA employee Jackie Brouwers In addition John Stirk became Chair of the Regulatory Review Committee succeeding Christine Van Daele who was chair of this important committee for almost 10 years and who was an excellent representative for mutuals to the regulatory community LOOKING AHEAD OMIA s focus will be on continuing to build relationships with the regulator with particular emphasis on supporting our current solvency monitoring regime and assisting both the regulator and our mutuals with some of the challenges associated with market conduct initiatives such as the Annual Statement of Market Conduct and the Fair Treatment of Consumers Guideline With the establishment of a new regulator we anticipate changes ahead but we believe that the early groundwork done will serve mutuals well as our new regulator s priorities come into focus 2 0 1 9 O N TA R I O M U T U A L I N S U R A N C E A S S O C I AT I O N A N N U A L R E P O R T

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2019 OMIA Group Reports OMIA s voting members are constituted into five distinct groups linked by geography and tradition The group structure supports grass roots involvement by member companies and provides a forum for problem solving and the exchange of ideas Each of these groups also provides one democratically elected director to the OMIA Board Annual reports of these groups are provided in the following pages Group A HOWARD KENT ESSEX LAMBTON NORTH KENT TOWN COUNTRY WEST ELGIN WESTMINSTER YARMOUTH KENT ESSEX MUTUAL HOSTED THE GROUP A ANNUAL MEETING ON NOVEMBER 21 2019 The meeting was held at the John D Bradley Centre in Chatham and was attended by directors and staff of Howard Mutual Kent Essex Mutual Lambton Mutual North Kent Mutual Town Country Mutual West Elgin Mutual Westminster Mutual and Yarmouth Mutual JP Gagnon and Tom Oegema attended on behalf of Farm Mutual Re Normand Lafreniere on behalf of CAMIC and John Taylor and Bob Burley on behalf of OMIA Glenn McGillivray Managing Director of the Institute for Catastrophic Loss Reduction and Tony Ngo CEO of Collectivfide were also invited as guest speakers Tim McIntosh of Kent Essex Mutual chaired the meeting After approval of the 2018 minutes the Presidents and CEO s from each of the member companies introduced new directors and staff and provided an overview of operations Andre Mailloux from Kent Essex Mutual presented the report from the Group A Nominating Committee recommending the re election of Tracy Wintermute as the OMIA Board representative for a three year term beginning in March 2020 The committee also put forth Christine Van Daele as the Farm Mutual Re Board representative for a three year term beginning in March 2020 Bob Burley OMIA Chair thanked the Group A companies in attendance and congratulated former OMIA Board colleague Christine Van Daele on her nomination to the Farm Mutual Re Board Bob spoke about 3rd quarter results and some of the needs of current policyholders Tom Oegema Farm Mutual Re Chair thanked Kevin Konecny for his work on the Farm Mutual Re Board Tom welcomed Christine to the Farm Mutual Re Board and spoke to her background with the mutuals and the OMIA Board Tom stated that it has been a pleasure to serve on the Farm Mutual Re Board He spoke about Farm Mutual Re s 2019 nomination for Best Practices in Strategic Planning Oversight and Value Creation by the Board of Governance Professionals of Canada Tom welcomed JP Gagnon to his role as President CEO of Farm Mutual Re Kevin Konecny moderated a panel discussion A prepared list of questions had been provided to panelists The panel representatives included John Taylor President OMIA JP Gagnon President CEO Farm Mutual Re and Normand Lafreniere President CAMIC Glenn McGillivray Managing Director of the Institute for Catastrophic Loss Reduction gave a presentation on climate change and how the use of fossil fuels is damaging the environment with significant impact to the insurance industry Guest speaker Tony Ngo spoke about his role as President CEO of Collectivfide and the future plans for the company He noted that Colllectivfide is building the foundation of the company based on value pillars Collectivfide has appointed Glenn McGillivray and Alex Gallacher an HR expert as independent directors Tony discussed the criteria used to evaluate and score target brokerages He gave four primary reasons for mutuals to invest in Collectivfide profitability volume protection return on equity and collaboration Tim McIntosh thanked everyone for attending the Group A meeting Lambton Mutual CEO Deb Van Eyk thanked Kent Essex Mutual for hosting and welcomed everyone to attend the 2020 meeting hosted by Lambton Mutual A social hour was held after the meeting concluded Collectivfide President CEO Tony Ngo updated Group A on future plans for the newly formed company 2 0 1 9 O N TA R I O M U T U A L I N S U R A N C E A S S O C I AT I O N A N N U A L R E P O R T 25

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Group B AYR FARMERS BCM BRANT CARADOC TOWNSEND CAYUGA DUMFRIES ERIE NOVA THE GROUP B ANNUAL MEETING WAS HELD ON NOVEMBER 19 2019 AT MONTHILL GOLF AND COUNTRY CLUB IN CALEDONIA THE MEETING WAS HOSTED BY CARADOC TOWNSEND MUTUAL Brian DeJeu Group B Chair of Caradoc Townsend Mutual and Chair of the Group B Executive Committee welcomed everyone to the meeting He called on each company CEO to introduce their company representatives and note any highlights for 2019 The afternoon session focused on a future risk radar report shared by Jeff Consitt Senior VP and COO of Farm Mutual Re The report highlighted how individual risks interact with each other in an external environment and the cascading effects of risk on our business model Tia Milnes Member Strategy and Relationship Manager at Farm Mutual Re used the risk report to pose questions to a panel composed of Allison Gunn Ayr Farmers Mutual Group Director elections for a three year term expiring in 2023 were held and Steve Quinn Cayuga Mutual was re elected to the OMIA Board Jill Chuli was nominated for re election to the Farm Mutual Re Board Adam Heeg Erie Mutual Greetings and highlights on the 2019 year were received from Normand Lafreniere President CAMIC John Taylor President OMIA Bob Burley OMIA Chair and Tom Oegema Farm Mutual Re Chair Phil Wellings Cayuga Mutual Keynote speaker and newly appointed Farm Mutual Re CEO JP Gagnon shared his insights on his first eight months with the company and their priorities for the future One highlight included his visit to Europe to meet with our reinsurers He also touched on the path to profitability reinsurance cost trends contraction in the Lloyd s Market strategic planning for the next four years and an update to the Farm Mutual Re Mission Collectivfide CEO Tony Ngo presented highlights of his first few months as CEO of a newly established company His emphasis was on Collectivfide s value pillars and being stronger together His presentation also included background on how the company would be evaluating prospective brokerage partners and the positive response to this initiative from the broker community Kate Ferraro Caradoc Townsend Mutual Nicole Hoskins Nova Mutual Rick Leigh Nadon BCM Insurance Sahith Tummala Farm Mutual Re TJ Sutton Dumfries Mutual This lively interactive discussion covered many of the areas that are rapidly evolving in the workplace and insurance marketplace Panelists shared personal observations on how advertising connects with younger generations the influence of social media and price on buying decisions data sharing and privacy millennial perceptions of brand loyalty and engagement and the unique challenges of sharing the value of mutuality with buyers They also discussed the components of a preferred workplace and motivating younger employees Brian DeJeu thanked all attendees The 2020 Group B annual meeting will be hosted by Cayuga Mutual at the Caledonia Fairgrounds Neil Shay President CEO of Caradoc Townsend Mutual introduced a panel assembled for a discussion on a number of pertinent topics 26 2 0 1 9 O N TA R I O M U T U A L I N S U R A N C E A S S O C I AT I O N A N N U A L R E P O R T

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Group C HAY MCKILLOP MIDDLESEX NORTH BLENHEIM SOUTH EASTHOPE TRADITION USBORNE HIBBERT WEST WAWANOSH THE GROUP C ANNUAL MEETING WAS HELD ON NOVEMBER 22 2019 AT THE FESTIVAL INN IN STRATFORD ONTARIO THE MEETING WAS HOSTED BY MIDDLESEX MUTUAL Each company president provided an update on new directors staff and agents and reported on financial results and comments for the year They also noted new initiatives planned for 2020 The Group C Nominating Committee Chair Paula Bodkin reported that current Farm Mutual Re Group Director Paul Vandenbosch had provided notice to serve a further term and had been selected by the committee as its recommended nominee Paul Vandenbosch came forward to thank the Group for their support and expressed his desire to continue representing Group C on the Farm Mutual Re Board Paul called on Tom Oegema Chair of Farm Mutual Re for comments Tom spoke on his year as Chair highlighting the events he attended including Steve Smith s retirement and noted the appointment of JP Gagnon as President CEO JP Gagnon also provided a brief report He discussed high growth in automobile as a concern along with adverse development trends on automobile claims reserving in the 2014 to 2016 accident years He also commented on challenges in the property line of business OMIA Group Director Terry Knight thanked the companies for their ongoing support and the sharing of information for him to take to the OMIA Board He advised that he would be Chair of the OMIA Board in 2020 and was looking forward to this role Terry introduced Bob Burley current OMIA Chair Bob described his active year as OMIA Chair and his personal enjoyment in meeting so many people from across the mutual system John Taylor OMIA President reported on various initiatives and the work of OMIA during the year He detailed the valued work of OMIA member committees and referenced the detailed reports provided by these committees in the P M Conference book John also reported on the potential for government reform on auto insurance and increased cost of collision repair He recapped IFRS 17 accounting changes and the plans for director education and group actuarial services He reported on Ontario Mutuals as the number one corporate supporter of 4 H Ontario and the development of a handbook on marketing for mutuals Normand Lafreni re President of CAMIC reported on issues including open banking demutualization regulations and the loss of the farm tax exemption He invited everyone to Mutuality Day in Ottawa on February 4 2020 Normand also reported on his planned retirement from CAMIC in August 2020 after many years of service On behalf of the Group C companies Terry Knight acknowledged and thanked Frank Rider for his 11 years on the CAMIC Board Nancy Preston introduced Dan Sandink Director of Research at the Institute for Catastrophic Loss Reduction ICLR ICLR is a disaster prevention research and communication organization and all mutuals are members through OMIA Dan provided a presentation on major areas of concern wind and water He discussed inexpensive ways to brace homes and some of ICLR s work with a St Thomas builder on a pilot project Tony Ngo CEO of Collectivfide provided a report on the new company and its broker acquisition plans COMPASS planning leaders from Farm Mutual Re Jeff Consitt Sonny D Agostino and Elizabeth Baker led a discussion with panelists Terry Knight Shawn Durnin John Taylor and Nancy Preston The topics included The Internet of Things and Insurtech both of which have been identified as Top 10 threats opportunities for mutuals Sandy McIntyre thanked Middlesex Mutual for hosting the meeting and extended an invitation to everyone to attend the 2020 Group C Annual Meeting hosted by North Blenheim Mutual Group C members enjoyed networking and connecting throughout their informative November meeting 2 0 1 9 O N TA R I O M U T U A L I N S U R A N C E A S S O C I AT I O N A N N U A L R E P O R T 27

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Group D ALGOMA DUFFERIN EDGE GERMANIA HALWELL HOWICK HEARTLAND PEEL TRILLIUM THE GROUP D ANNUAL MEETING TOOK PLACE AT THE OMIA AND FARM MUTUAL RE OFFICES ON PINEBUSH ROAD IN CAMBRIDGE ON NOVEMBER 18 2019 Louis Durocher of Heartland Farm Mutual chaired the meeting and welcomed delegates from Group D companies Each company reported on their results year to date with many companies noting significant growth and improving conditions Some companies also reported on adverse development in Ontario auto Dr Richard Leblanc a York University professor who specializes in governance led a session on best practices and current trends in Canadian corporate governance He covered a wide range of topics with a focus on setting the tone for the organization and board and CEO effectiveness and succession His engaging style was well received by the audience The group also received reports from CAMIC OMIA and Farm Mutual Re touching on a range of topics including demutualization fintechs the potential for Ontario Auto reform IFRS 17 preparation and the Path to Profitability Tony Ngo President CEO of Collectivfide the mutual owned broker acquisition company provided an update on the new company s progress to date Activity remains high in broker consolidations and the new organization has firmly established its operating principles and outlook The 2020 Group D meeting will be hosted by Halwell Mutual Dr Richard Leblanc York University spoke to Group D about current trends in Canadian corporate governance 28 2 0 1 9 O N TA R I O M U T U A L I N S U R A N C E A S S O C I AT I O N A N N U A L R E P O R T

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Group E AMHERST ISLAND BAY OF QUINTE THE COMMONWELL GRENVILLE HTM L A THE GROUP E ANNUAL MEETING WAS HELD ON JUNE 4 2019 AT THE LODGE STELLA AT AMHERST ISLAND Keith Miller Chair of Amherst Island Mutual welcomed 50 delegates from each of the Group E mutuals Chair Miller provided a brief history of Amherst Island including its settlement in the 1500s by French subjects Early settlers valued the islands access to Lake Ontario and inland waterways Subsequently the spar pine on the island was in demand for ship masts and two ship building plants were established to build lake schooners By the early 1800s United Empire loyalists had begun settling the island Early agriculture was based on the export of barley to the US for brewing but by the 1920s a mixed farming economy had taken root Amherst Island Mutual was founded in 1894 Each company s CEO provided updates to the group on strategic initiatives new staff and directors and results in the first part of 2019 The weather patterns in Eastern Ontario continue to be a challenge for both frequency and severity of water events Following the company updates the CEOs and Chairs of OMIA Farm Mutual Re and CAMIC took part in a panel and addressed questions including consideration of the greatest challenges facing the mutual system today approaches and views on board director succession recruiting staff in small Ontario towns addressing water risks with changing weather patterns and increasingly severe rainfall and practical tips for managing cyber exposure The group provided Steve Smith with best wishes in anticipation of his upcoming retirement from his role as President of Farm Mutual Re The group also welcomed JP Gagnon to his new role as Farm Mutual Re President CEO OMIA Chair Bob Burley reminded the group to begin succession planning for Group E Directorship for March 2021 Farm Mutual Re Group E Director Gord Lodwick thanked the group for its ongoing support As always excellent hospitality was extended to all by Amherst Island and the Caughey family Of particular note was the formal announcement by L A Mutual Board Chair Duncan Hough of L A s plans to move to a new home having purchased the former Napanee Co op and feed mill Creating new office premises in this part of Napanee s revitalized Gibbard District project will contribute to the town s development and keep L A in the heart of Napanee Group E experienced the hospitality of host Amherst Island Mutual during their June meeting 2 0 1 9 O N TA R I O M U T U A L I N S U R A N C E A S S O C I AT I O N A N N U A L R E P O R T 29

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2019 People Events Presidential Merit Award CATHERINE MACLELLAN RECEIVED THE PRESIDENTIAL MERIT AWARD AT OMIA S 2019 ANNUAL CONVENTION Catherine began her distinguished career with the mutuals in 1994 when the Fire Mutual Guarantee Fund mutuals determined that a more hands on solvency monitoring system would serve mutuals and their policyholders well in identifying solvency concerns at a very early stage Catherine MacLellan Catherine was appointed to the original Solvency Monitoring Committee based on her work with Price Waterhouse and her previous work as a regulator at the office of the Superintendent of Financial Institutions Over the course of the years Catherine provided a steady hand and was instrumental in developing the current mutual system of solvency monitoring and reporting to the Financial Services Commission of Ontario This unique solvency examination process puts great responsibility on the mutuals for selfmanagement but also recognizes the mutuals dedication to ensuring security of all policyholders in the mutual system Over the last several years Catherine has continued to play a key role in adapting the mutuals to myriad regulatory changes that have arisen in the property casualty industry Catherine s efforts have been instrumental in ensuring that reporting changes on areas as diverse as P C 1 s IFRS and Minimum Capital Tests take into account the unique scale and structure of mutual insurers She has demonstrated a unique ability to provide both oversight and support to mutuals Catherine has been a strong advocate for mutual values and for the mutuals core commitment to policyholder protection Catherine s annual report at the President and Manager s Meeting her guidance to the Accounting Roundtable and her visits to Group Meetings have provided accessible expertise to all of the mutuals In accepting the award Catherine acknowledged the support and assistance she has received over the years from other members of the Financial Review Committee She also thanked the mutuals for the many years of camaraderie provided by her association with the mutuals Past recipients of the award include 30 2018 Steve Smith 2005 Rick Walters 1992 Don Mylrea 2017 Shelley Sutton 2004 Rob Forsythe 1991 Vern Inglis 2016 Sue Baker 2003 Glen Johnson 1990 Dave MacKay 2015 Tim Shauf 2002 Ernie Koehler 1989 Mel McIntyre 2014 Neil Shay 2001 Randy Hutchinson 1988 Fred Legg 2013 Frank Rider 2000 Aleck Stickle 1987 David Wilson 2012 Don Davidson 1999 Dave Bailey 1986 Ed Pellow 2011 Alec Harmer 1998 John Harper 1985 Bruce McBlain 2010 Joe Dietrich 1997 Carrol Lambert 1984 Gerald Snyder 2009 Bill Jellous 1996 Stuart Howlett 1983 Emory Knill 2008 Kathryn Adie 1995 Ron Perry 1982 Bill Weir 2007 Brian Fisher 1994 Bert Abbott 1981 Bruce Caughey Sr 2006 Bob Brenner 1993 Lorne Wolgemuth 1980 Max Forsythe 2 0 1 9 O N TA R I O M U T U A L I N S U R A N C E A S S O C I AT I O N A N N U A L R E P O R T

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2019 People Events Outstanding Contributor Award OMIA HONOURED GERMANIA MUTUAL OF AYTON ONTARIO WITH IT S PRESTIGIOUS OUTSTANDING CONTRIBUTOR AWARD AT THE 2019 ANNUAL CONVENTION Germania was organized in Neustadt Ontario in 1878 by the farming community that populated the southeast portion of Grey County This community was largely German speaking and the companies first policies were issued in German Germania s contribution to the mutual system has been leadership and support on behalf of the whole mutual community Larry Bieman a former manager and Sharon Hollister CFO have served as trustees of the Fire Mutuals Guarantee Fund Dan Hill Germania CEO has served on several OMIA committees and also served as Chair of Farm Mutual Re Tracy Campbell Peggy Raftis and Sharon Hollister have all served as OMIA Education Roundtable Chairs In addition Germania has also generously supported its neighboring mutuals any time the need has arisen and is a constant contributor to discussions on mutual opportunities and challenges Germania also enthusiastically supports OMIA s Legislative Affairs program working with MPPs In presenting the award there was an opportunity to quote the Chair s address from the Association s 50th anniversary convention in 1932 That address was written by Dr R H Fortune the Chair of Germania Dr Fortune was remembered as a good helper one who was always congenial and happy and in a helpful mood in our association meetings This spirit of mutuality and encouragement still thrives today at Germania Mutual Past recipients of the award include 2018 Amherst Island 2011 Kent Essex 2004 Oxford 2017 Hay Mutual 2010 Cayuga 2003 Dufferin 2016 Bay of Quinte 2009 Lambton 2002 Formosa 2015 PEI 2008 North Kent 2001 Peel 2014 Grenville 2007 West Elgin 2000 Brant 2013 Westminster 2006 Glengarry 1999 Farmers Lindsay 2012 Lanark 2005 Ayr Farmers 1998 Hamilton Township Germania Mutual President CEO Dan Hill addressed the crowd at the 2019 Convention 2 0 1 9 O N TA R I O M U T U A L I N S U R A N C E A S S O C I AT I O N A N N U A L R E P O R T 31

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Distinguished Service Award TERRY MALCOLM WAS THE RECIPIENT OF THE DISTINGUISHED SERVICE AWARD AT THE 2019 PRESIDENTS MANAGERS MEETING HELD IN OTTAWA IN OCTOBER Terry Malcolm was the recipient of the Distinguished Service award at the 2019 Presidents Managers Meeting held in Ottawa in October OMIA President John Taylor Brenda Malcolm Terry Malcolm and OMIA Chair Bob Burley The Distinguished Service Award is presented annually to an individual who has made a significant contribution to the farm mutual system over the course of their career Terry is the 34th recipient of this award Terry s involvement in mutual insurance dates from 1985 when he was elected to the board of directors of the Farmers Mutual Insurance Company in Lindsay Ontario Over the course of his career Terry was a champion of effective board governance and served two terms as Farmers Board President He was also the inaugural chairman of the Commonwell Mutual Insurance Group which was formed in 2014 from the amalgamation of Farmers Mutual Glengarry Mutual and Lanark Mutual Terry s contributions to the broader mutual system include serving on the board of the Farm Mutual Reinsurance Plan from 1994 to 2004 with a year as Chair in 2001 2002 Terry was also involved in the 1990s with the Solvency Protection Committee of the Fire Mutuals Guarantee Fund Outside of his mutual insurance work Terry has been a leader in Ontario s agricultural community and has been involved with many agricultural farming organizations including most recently as a board member for the Ontario Agricultural Hall of Fame Congratulations Terry The Commonwell Mutual celebrated Terry Malcolm at the 2019 Presidents Managers Meeting 32 2 0 1 9 O N TA R I O M U T U A L I N S U R A N C E A S S O C I AT I O N A N N U A L R E P O R T

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2019 Appointments NOVA MUTUAL PRESIDENT CEO The Board of Directors of Nova Mutual Insurance announced the hiring of Gary Anderson as the new company s President and Chief Executive Officer effective January 1 2019 Gary came to Nova Mutual with a strong skill set and rich experience from over 35 years working in the P C insurance industry Gary s superb leadership skills and ability to build high performance teams proved especially valuable as he led Norfolk Mutual and Wabisa Mutual to form the new Nova Mutual Insurance Company Gary came to Nova from Gore Mutual as Digital Projects Manager Gary grew up on a flue cured tobacco farm in Norfolk County He left the area to pursue post secondary education but has many friends still in the area Gary began his career as a personal and commercial lines underwriter and then moved into claims adjusting with Otter Dorchester Mutual and Anglo Gibraltar He spent 12 years as Claims Manager with Cunningham Lindsey restructuring their Burlington and Oakville branches and in their Special Investigations Unit Gary s management and IT expertise then led him into managing project teams and projects related to claims and risk management implementation with Accenture and other firms The broad list of insurers where Gary managed project teams includes Ohio Mutual Insurance Group Mutual Fire Insurance of British Columbia Insurance Corporation of British Columbia RSA Canada and Gore Mutual Insurance Company Gary left Accenture to become Digital Projects Manager at Gore Mutual Insurance where he managed Gore s first fully digital e commerce business product His product was awarded the 2015 HP Visionary Award for Most Sophisticated Application Gary managed several other projects and project teams using agile methodology while at Gore including contributing to establishing Gore s cloud infrastructure Gary is an exceptional leader and team player who has a lot to offer to Nova Mutual and to the mutual insurance network MENNONITE MUTUAL CEO GENERAL MANAGER The board of Mennonite Mutual announced the appointment of Sandra van Raalten as the CEO General Manager of Mennonite Mutual Insurance Co Alberta Ltd MMI and its subsidiary company Mennonite Insurance Agency Ltd effective January 14 2019 Sandra brings with her a wealth of insurance and leadership experience She was most recently employed by Wawanesa Insurance as Alberta Region Claims Manager Bodily Injury Her past employment includes project leadership and claims management with Allstate Insurance claims adjusting for ICBC and Music and Programming Director at Kamloops Alliance Church 34 Sandra s education includes a master s degree in Conflict Analysis and Management Royal Roads University Victoria BC a bachelor s degree in Sociology and English University of Saskatchewan Saskatoon SK a Diploma in Pastoral and Missions Nipawin Bible Institute Nipawin SK and the Chartered Insurance Professional CIP designation from the Insurance Institute of Canada MMI looks forward to continuing on a path of innovation and growth with Sandra 2 0 1 9 O N TA R I O M U T U A L I N S U R A N C E A S S O C I AT I O N A N N U A L R E P O R T

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2019 Appointments SEH COMPUTER SYSTEMS INC PRESIDENT CEO The Board of Directors of SEH Computer Systems Inc announced the appointment of Mark Ross as President and Chief Executive Officer effective July 17 2019 as an entrepreneur and partner at Competitive Edge Information Systems He also teaches degree courses at Conestoga College and has volunteered as a reading coach for the Strong Start program Mark is a graduate of Computer Engineering from the University of Waterloo and has an M Ed from D Youville College He most recently spent seven years with Sun Life as Director of Business Process Automation where he built a team of over 35 people to deliver value to business partners by automating manual processes using both traditional software tools as well as robotic desktop automation Prior to that he spent 19 years building custom software Mark is an agile advocate and is certified as both a Scrum Master and Product Owner With clearly demonstrated strengths in transformation management performance development and delivering results The addition of Mark Ross to the SEH team invites a new era of exciting new product features under the direction of a skilled leader that thrives in a change environment FARM MUTUAL RE PRESIDENT CEO The Board of Directors of Farm Mutual Re announced the appointment of Jean Pierre JP Gagnon as President and Chief Executive Officer effective August 1 2019 JP has worked in the property and casualty insurance industry since leaving his hometown of Quebec City in 1991 He has held senior leadership roles in actuarial risk management and underwriting in Canada and abroad Most recently JP was Vice President Personal Insurance for Travelers Canada Prior to that role he held Chief Actuary and Chief Risk Officer positions with Travelers JP also held leadership underwriting and actuarial roles at CAA Insurance Company Eckler Partners and TDMeloche Monnex JP has a Bachelor s degree in Actuarial Sciences from Laval University and is a Fellow of both the Casualty Actuarial Society and the Canadian Institute of Actuaries JP is an avid Montreal Canadiens and Toronto Blue Jays fan and plays both hockey and baseball in his spare time He also enjoys scouring record shops for rare finds and going to concerts with his 18 and 20 year old daughters who currently attend the University of Toronto He and his wife Margaret enjoy hosting large barbeques in the backyard of their Unionville home I understand that I have incredibly big shoes to fill and I am truly honoured to succeed Steve Smith who has done a phenomenal job of leading the organization said JP I am excited about joining the team and working closely with our members 2 0 1 9 O N TA R I O M U T U A L I N S U R A N C E A S S O C I AT I O N A N N U A L R E P O R T 35

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2019 Appointments YARMOUTH MUTUAL PRESIDENT CEO The Yarmouth Mutual Board of Directors announced the appointment of Adam Kuron as President and Chief Executive officer effective August 6 2019 Adam was previously the Chief Financial Officer with Yarmouth Mutual a position he held since February 2015 Prior to joining Yarmouth Mutual Adam spent almost eight years at BDO Canada in Woodstock working in auditing and assurance Adam holds an Honours Bachelor of Accounting degree from Brock University and obtained his Chartered Accountant designation in 2010 BCM INSURANCE PRESIDENT CEO The Board of Directors of BCM Insurance announced the appointment of Jason Cybulski as President and Chief Executive Officer effective September 3 2019 Jason was previously the President and CEO of Brant Mutual Insurance Company He began there in 2003 as Claims Manager and was promoted to Vice President where he acted as Staff Manager Marketing Liaison with agents and brokers as well as continuing to have full oversight for claims management He also worked for Cunningham Lindsey Canada in Hamilton as an Independent Adjuster and then Supervisor Jason is a member of the OMIA Auto Rate Filing Committee He has been an Instructor for the insurance Institute of Ontario since 2001 and he is a Past President and Director of the Ontario Insurance Adjusters Hamilton Chapter He graduated from the Mohawk College Insurance Program and also General Business Course 36 specializing in Accounting He has achieved such designations as a Fellow Chartered Insurance Professional Certified Risk Management Diploma Professional Farm Mutual Manager sponsored by National Association of Mutual Insurance Companies NAMIC and in 2017 was the recipient of the NAMIC Merit Award He is a committed life long learner who recently completed the Advanced Leadership Certificate sponsored by the University of Waterloo and also the Workplace Mental Health Leadership Certificate through Queen s University Board Chair David Gill stated We are extremely pleased to have someone with Jason s experience and background to be joining our company His insurance knowledge particularly of the Farm Mutual industry will be a great asset We are impressed with his ongoing commitment to developing his leadership abilities The Board believes Jason will be a great addition to our team and provide the direction and guidance needed going forward 2 0 1 9 O N TA R I O M U T U A L I N S U R A N C E A S S O C I AT I O N A N N U A L R E P O R T

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2019 Appointments COLLECTIVFIDE INSURANCE GROUP PRESIDENT CEO The Board of Directors of the Broker Acquisition Company Collectivfide announced that Tony Ngo would join the company on September 3 2019 as Chief Executive Officer Tony joined Collectivfide from the Bank of Montreal BMO with over a decade of financial services experience including in the P C insurance sector He began his tenure with BMO in 2008 and has progressed in multiple senior roles and responsibilities In his last role at the bank he was mandated with the development and implementation of strategic initiatives across the nation Tony has built a strong reputation in the P C insurance space and has earned the trust of many insurance brokers and carriers by helping them with benchmarking studies financial assistance and has played a crucial role as advisor in numerous mergers and acquisitions transactions Prior to his roles at BMO Tony worked as an engineer for eight years at General Motors in St Catharines Ontario where he was tasked with the integration of global engine and transmission projects Tony holds a Masters of Business Administration from the Rotman School of Management at the University of Toronto along with Professional Engineer designation and a Bachelors degree in Applied Science Mechanical Engineering from the University of Waterloo In his spare time Tony loves to spend time with his wife Jeanette and their son Jonas He also enjoys his time outdoors in the Niagara Region riding on his green tractor and enjoying a good book TRILLIUM MUTUAL PRESIDENT CEO The Trillium Mutual Board of Directors announced the appointment of Tracy MacDonald BA FCIP as President and Chief Executive Officer effective November 1 2019 Previously Tracy was the Vice President of Corporate Services with Trillium Mutual a position she held for four years Tracy has over 25 years experience in the P C Insurance business and has held positions in all aspects of the business Tracy began her career at Formosa Mutual one of Trillium Mutual s founding companies completing part time administrative duties as a high school student Tracy also serves as a Director on the Board of Directors of the Canadian Association of Mutual Insurance Companies CAMIC Tracy holds a B A in Economics from the University of Guelph an Advanced Executive Certificate in General Management from Queen s School of Business and a Fellow Chartered Insurance Professional designation Tracy s commitment to learning and innovation her unique mix of skills leadership qualities and passion for mutuality positions her for continued success in leading the organization forward Tracy is a proven leader who is ready to take on the responsibilities of the President CEO for Trillium Mutual Insurance Under her leadership Trillium Mutual will continue to provide innovative insurance solutions for its policyholders across Ontario said Ross Lamont Chair of the Board of Directors Lamont added that Although there was tremendous interest in this position Tracy was the clear choice as the next CEO 2 0 1 9 O N TA R I O M U T U A L I N S U R A N C E A S S O C I AT I O N A N N U A L R E P O R T 37

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VOTING MEMBERS Algoma Mutual Insurance Company Amherst Island Mutual Insurance Company Ayr Farmers Mutual Insurance Company Bay of Quinte Mutual Insurance Company BCM Insurance Company Brant Mutual Insurance Company Caradoc Townsend Mutual Insurance Company Cayuga Mutual Insurance Company The Commonwell Mutual Insurance Group Dufferin Mutual Insurance Company Dumfries Mutual Insurance Company Edge Mutual Insurance Company Erie Mutual Insurance Company Germania Mutual Insurance Company Grenville Mutual Insurance Company HTM Insurance Company Halwell Mutual Insurance Company Hay Mutual Insurance Company Howard Mutual Insurance Company Howick Mutual Insurance Company Kent Essex Mutual Insurance Company L A Mutual Insurance Company Lambton Mutual Insurance Company McKillop Mutual Insurance Company Middlesex Mutual Insurance Company North Blenheim Mutual Insurance Company North Kent Mutual Fire Insurance Company Nova Mutual Insurance Company Peel Mutual Insurance Company South Easthope Mutual Insurance Company Town Country Mutual Insurance Company Tradition Mutual Insurance Company Trillium Mutual Insurance Company Usborne Hibbert Mutual Insurance Company West Elgin Mutual Insurance Company Westminster Mutual Insurance Company West Wawanosh Mutual Insurance Company Yarmouth Mutual Insurance Company ASSOCIATE GROUPS MEMBERS Non Ontario Antigonish Farmers Mutual Insurance Company Carleton Fundy Mutual Insurance Company Clare Mutual Insurance Company Germania Mutual Insurance Company Sask The Kings Mutual Insurance Company Mennonite Mutual Insurance Company Alberta Ltd My Mutual Insurance Company Portage La Prairie Mutual Insurance Company Prince Edward Island Mutual Insurance Company Saskatchewan Mutual Insurance Company SouthEastern Mutual Insurance Company Stanley Mutual Insurance Company United General Insurance Corporation Ontario Farm Mutual Re Heartland Farm Mutual Insurance Company

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