Return to flip book view

2022 OMIA Annual Report

Page 1

- Chair, Steve Quinn, Cayuga Mutual -ANNUALREPORT2022The Ontario Mutual Insurance AssociationGrassroots insurance at the core of thriving communities

Page 2

Chair, Steve Quinn’s theme for 2022 was, Our People, Our Communities, A Celebration of Success.It recognizes that at the heart of every member company is a team of staff and directors who dedicate themselves to giving back in ways both big and small. Without our “relentless volunteers”, and the encouragement from each other, we simply wouldn’t be able to make the impact that we do. A true example of neighbour-helping-neighbour.OMIA Board of Directors.......................................................................OMIA Staff.............................................................................................2022 Annual Convention Summary.......................................................2022 P&M Summary.............................................................................OMIA Awards........................................................................................Committee Reports...............................................................................Group Reports......................................................................................Financial Statements............................................................................346810184349

Page 3

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT3John Taylor PresidentOMIASharon DittmerTreasurerOMIAKevin Inglis2nd Vice ChairGroup D DirectorHowick MutualNeil Shay 1st Vice ChairDirector at LargeCTM InsuranceJohn StirkPast ChairDirector at LargeDufferin MutualSteve QuinnChairGroup B DirectorCayuga MutualMarg TorranceDirector at LargeHalwell MutualTerry Knight Group C DirectorNorth Blenheim MutualDave RutherfordGroup E DirectorHTM InsuranceScott RoungDirector at LargeDumfries MutualTracy WintermuteGroup A DirectorWestminster Mutual2022 OMIA BOARD OF DIRECTORS

Page 4

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT4Administrative ServicesJohn TaylorPresidentSharon DittmerTreasurer/Manager, Administrative ServicesPascale SwansonE-Learning DeveloperMandy HetheringtonAdministrative AssistantHeidi DuMaresqBenets & HR SpecialistDanielle RichardsonBenets & HR AdministratorJeff FergusonDirector of OperationsKyle MurphyStatistical CoordinatorJulia Sharma Business Intelligence AnalystKarandeep Sekhon Business Intelligence AnalystLisa HunterManager, Marketing & CommunicationsDaljit JohalExecutive AssistantShawn ZhangManager, Statistics & Information ServicesPaula GeorgeiAccounting SpecialistSusan BakerManager, Insurance ServicesKarolina ProminskiDesktop Support AnalystShah ShirzadiIT SpecialistStatistics & Information ServicesMarketing & Communications ComplianceJackie RoyCompliance Resource OfcerMike TolanCompliance AnalystTavia TobeyMarketing & CommunicationsCoordinatorKara TobeyMarketing & CommunicationsAssistantPresident & ManagersRachel CarewPension & Benets CoordinatorJennifer HiguchiInsurance Resource OfcerChristine SeniorSupervisor, Insurance ServicesJanet Schmidt Training & Research OfcerNicole Hackney Training & Research OfcerInsurance ServicesKip MoiInsurance Resource OfcerDonna BarlowAccounting Assistant - ReceivablesMichelle PorterAccounting Assistant - PayablesDanita JohalPension & Benets Assistant

Page 5

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT5Compliance - OMIA has dedicated compliance professionals who provide leadership, environmental monitoring, education, and expert guidance on solvency reporting, governance, market conduct and corporate risk management that meet regulatory requirements.Data Strategy and Statistics - OMIA provides member companies with an efcient method of reporting regulatory data, while anticipating data requirements for collective analysis and business intelligence initiatives.Education - OMIA has a dedicated education team that creates online and in-person training sessions. These courses are continuously changing and evolving to ensure that member companies have important and up-to-date information. We also have an OMIA Certication Program to facilitate continuing education and professional development.Employee Pension and Benets - OMIA staff and the Benets Committee are committed to providing guidance on issues related to employee and company benet programs that are available to the membership through OMIA. We are pleased to report that we continue to have a plan that meets or exceeds expectations in today’s labour market. General Meetings - OMIA hosts a variety of meetings and roundtables that allow member companies to come together, gain important information, discuss current and future challenges, innovate, and learn from one another.Government Relations - OMIA and the Legislative Affairs Committee play an important role in maintaining the Ontario Mutuals’ prole with MPPs and MPs. We act as ambassadors to the legislature and communicate the impact of proposed legislation while providing an informal sounding board for MPPs. This includes roundtable discussions and a visit to Queen’s Park each year.Industry Liaison - OMIA maintains strong relationships with industry partners and keeps lines of communication open on behalf of the mutual community. OMIA will share unied messages with organizations like the Financial Services Regulatory Authority of Ontario (FSRA) and others. Insurance for Insurance Companies - Like any business, mutuals need insurance for their own unique risk management needs. OMIA has worked with trusted broker partners and underwriters to develop Directors and Ofcers, Errors and Omissions, Fidelity Bond, and Cyber Risk insurance programs that protect mutuals against these constantly evolving business risks.Market Research - OMIA periodically facilitates the collection of market research to gather data and reveal market trends that help member companies make informed decisions around marketing. We also have a Market Issues Committee which gathers and analyzes industry information that affects the mutuals’ ability to serve their policyholders.Product Development - As the world changes, so do insurance needs, and OMIA is continuously monitoring the heartbeat of all things insurance. With the help of the Product Strategy Committee and colleagues at Farm Mutual Re, OMIA updates and creates insurance products for member companies to implement. Promotion - OMIA promotes the Ontario Mutuals brand through sponsorships, advertising, and events. OMIA also has a dedicated marketing team that is available to support member companies with their individual marketing projects. Special Projects and Studies - When a mutual asks, “Is it a good idea or not?” or “ Are we up to date with emerging trends?” or “Can we tackle a bigger challenge together?” It might be time for a project or study to help members evaluate next steps. Bi-annual salary and compensation surveys, feasibility studies on shared resources, cyber risk inventories, IFRS-17 conversion research and tools, and pilot groups for new roundtables are all examples of successful mutual initiatives that started with an OMIA special project or study.OMIA SERVICE AREASStatistics & Information ServicesInsurance Services

Page 6

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT6OMIA Chair, John Stirk welcomed delegates to OMIA’s 140th Annual General Meeting and Convention.In our rst in-person convention since March 2019, 413 individuals turned out in-person, with a further 93 online.John’s theme for the year was “Still Standing for a Reason”.He highlighted the importance of individual contributions to the mutual system and how we all benet when people get involved. John emphasized the grassroots nature of OMIA’s work and its core vision to meet member needs and enable individual mutuals to complete their own mission to policyholders.John noted the importance of our history in pointing the way forward, but also the need to use every opportunity to increase the spirit of mutuality and mutual insurance.The Convention keynote for the morning was CBC’s Terry O’Reilly who spoke on the power of storytelling. He noted that powerful stories have an incredible shelf life, and shared examples of how organizations were able to demonstrate the intangible benets of their products and services through stories that demonstrated trust and commitment.John Taylor provided a report on key OMIA projects in 2021 and reected on how current issues often mirror the past. He cited the 1922 Convention minutes on challenges including rate adequacy, insurance to value, and mutual cooperation, all of which are still with us today. He highlighted the important work being done on creating an insurance prudential supervisory framework, rolling out IFRS-17, setting up mutuals for success with the changing workforce, and OMIA’s adaption of education to the new virtual world.OMIA Treasurer, Sharon Dittmer provided a report to delegates including nancial statements.The following motions were brought forward:1. APPROVAL OF THE MINUTES OF THE 2021 ANNUAL GENERAL MEETINGTHAT, the Minutes of the Annual General Meeting of the Ontario Mutual Insurance Association as held March 25, 2021 be approved.Moved by: Brian Laporte Howick MutualSeconded by: Allan Sheppard HTM InsuranceCarried.2. FINANCIAL & AUDITORS REPORTTHAT, the Financial Report and Auditors Report for the Ontario Mutual Insurance Association for the year ended December 31, 2021 be adopted as presented.Moved by: Greg Van Berkel Westminster MutualSeconded by: Frank Barretto Dufferin MutualCarried.2022 ANNUAL CONVENTIONMarch 30th & 31st, Sheraton Hotel, TorontoChair, John Stirk2021/2022

Page 7

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT73. APPOINTMENT OF AUDITORSTHAT, Clarke, Starke and Diegel be appointed auditors for the Ontario Mutual Insurance Association for the year 2022.Moved by: Steve Graham Halwell MutualSeconded by: Marv Schupp CTM InsuranceCarried.4. ELECTION OF DIRECTORS AT LARGEJohn Stirk reviewed the OMIA By-law provision on nomination and election of Directors At Large. Two candidates had put forward their names and had been qualied and vetted by the Nominating Committee and OMIA Board. With two open positions to be lled, the candidates were presented to membership. THAT, Neil Shay and Scott Roung be elected by acclamation for a 3-year term ending at the Annual General Meeting in 2025.Moved by: Tim Montague Cayuga MutualSeconded by: Denise Tew North Blenheim MutualCarried.Incoming Chair, Steve Quinn introduced his theme for the upcoming year, “Our People, Our Communities, A Celebration of Success” and thanked John Stirk for his excellent work over the past year.The Fire Fighters Association of Ontario President, Kevin McNeilly and Medal of Merit Chair, Jamie Hiller joined OMIA as four Medal of Merit award winners were honoured: Fireghter Andreas Fortis, Fireghter Matt Dickison, Fireghter Matt DeVries, and Fireghter Jamie Hiller.Distinguished Service Awards were presented to Nancy Preston, formerly of Middlesex Mutual, and Terrye Calnan, formerly of HTM Insurance.The Presidential Merit Award was presented to Brian Downie of West Elgin Mutual and Alan Hedley of Cayuga Mutual.The non-delegates program was provided by Mairlyn Smith, in memory of Pat Burley.During the afternoon, delegates participated in educational sessions on the Canadian Economy in 2022, the Canadian Co-operative Development Foundation, FSRA’s Principles Based Regulation, and Quick Hits Merging Issues on Credit Scoring, Pandemic Employment Developments, Virtual AGM’s and Board Meetings, and Right Sizing Boards Under the Corporations Act.Banquet entertainment was provided by comedian James Cunningham who also assisted Auctioneer Doug Crockett in a rollicking live auction for the Farm Mutual Foundation. In combination with silent auction proceeds, over $30,000 was raised for the scholarship program.

Page 8

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT8The 2022 President and Managers meeting took place over three beautiful autumn days at Blue Mountain Resort.Chair, Steve Quinn welcomed delegates to Blue Mountain for the rst P&M held there since 2017.In welcoming delegates, Steve built on his theme for the year and noted, “Because we are small, we get to be part of something bigger.”Opening keynote speaker, Shane Feldman, spoke on his inspiring leadership journey which has revolved around inclusiveness and looking for opportunities to bring people together in support of group goals. He highlighted some of his experiences in visiting diverse cultures around the world and their approach to building community and belonging. The business session included reports from Chair, Steve Quinn and OMIA President, John Taylor. Steve spoke to the importance of volunteerism among the mutuals and the importance of supporting communities just as they support mutuals. Steve urged attendees to share their volunteer stories and encourage them to do so through OM News and other forums.Steve also launched a fundraising project for the Community Addiction and Mental Health Services of Haldimand and Norfolk (CAMHS). With a ponytail that will reach its third “pandemic” year birthday in March 2023, Steve is collecting pledges for a ponytail removal, live and in-person at the Annual General Meeting.John Taylor spoke to the importance of mutuals as purpose driven organizations. He noted that even purpose driven organizations need to have sound business practices and generate prots to be able to grow and strategically support customers. He highlighted the profound impact of the May 21 derecho catastrophe event in Ontario and the devastation created by Post Tropical Storm Fiona in Nova Scotia and PEI in September. John acknowledged the efforts of all the individuals who responded to these claims and to the willingness of other mutuals to volunteer staff in assisting companies to manage through supporting policyholders. John recognized Farm Mutual Re for their support of mutuality throughout a difcult catastrophe year.John also spoke about the increasing regulatory burden and opportunities for mutuals to work through these challenges together. Chair, Brian Downie convened the Fire Mutuals Guarantee Fund business meeting. He thanked his fellow trustees and spoke to the evolution of the FSRA relationship with the Fire Mutuals Guarantee Fund members.He also spoke about the ongoing work and expertise of the Financial Review Committee and the potential to transition to different roles. He acknowledged the efforts of Bill Embree who retired from the Financial Review Committee in the spring and welcomed Jeff Wickware and Andrew Cartmell to the Financial Review Committee.Annual expenses for the Fire Mutuals Guarantee Fund of approximately $260,000 were reported to the membership. The balance of the fund is down slightly due to a decrease in the market value of xed income securities.Brian noted there will be elections in March for two trustee Chair, Steve Quinn2022/20232022 PRESIDENTS & MANAGERSOctober 23rd to 25th, The Blue Mountains, Ontario

Page 9

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT9terms, one of which will be a full term with an incumbent, Sharon Hollister. The second will be for the two years remaining on his term as he will be moving off the trustee board in March.Brian also conrmed to the membership that no individual companies posed a solvency threat to the fund.Catherine MacLellan gave the Financial Review Committee update. She reported on nancials to the end of June 2022 and noted the year-to-date net loss was largely driven by investment income setbacks. Catherine reported on the review of the Key Metric Reports and the evolution of the stress tests being provided to FSRA. She conrmed that an IFRS-17 readiness report is ready to go and that the Financial Review Committee in continuing to study changes to the MCT anticipate only minimal impact under IFRS-17.As the nal session of the morning, Tony Ngo provided a Collectivde update on organizational growth and recent acquisitions.The Monday, October 24 afternoon sessions included a presentation by Daniel Willmann and Brooke McConville of E&Y on the anticipated changes under IFRS-17 for directors. This was insightful as it related to the creation of new accounts and how to begin interpreting them and analyzing the nancial position of a mutual.Speaker, Ritesh Kotak presented on cyber risk and new developments in the world of privacy along with the continued vulnerability of apps on phones and personal computers.The afternoon’s closing speaker, Vince Saccomando reviewed the legal system in New York State and the potential risks involved for Ontario drivers involved in accidents in the United States.Following the adjournment for the day, Collectivde convened a private members session.On Monday evening, attendees enjoyed an informal reception and hospitality event.Tuesday morning presentations kicked off with a claims panel. Senior claims professionals, Brent Hackett with Crawford and Company, David Colyn of Trillium Mutual, and Garth Winterton of The Commonwell provided key insights on their experiences with catastrophe claims in 2022, the ongoing development of technology in assessing claims, supporting remote workers, and the unique challenges imposed by ination and supply chain constraints over the past year.Farm Mutual Re Director, Jill Taylor, provided her annual report as Chair of the Farm Mutual Foundation. Each year students are asked to share their thoughts on important topics. This year’s topic was “Identify an under-represented social issue, explain why this issue is important to you, and why we should all care.”213 scholarships were awarded in 2022, and the total scholarships awarded since 2005 are $3.6 million. In addition, a special gift from Blair and Maureen Campbell topped up scholarships for students from PEI.Farm Mutual Re held an information session which included an address by Chair, Valerie Fehr of My Mutual. Valerie shared her background and the Farm Mutual Re board’s progress on Environmental, Social, and Governance issues and Equity, Diversity, and Inclusion issues. She noted the board is looking at the concept of independent directors and asked all companies to provide their feedback on this question. Farm Mutual Re President & CEO, JP Gagnon provided a report on the year to date, and particularly on Farm Mutual Re’s contributions towards mutuals responding to two historic catastrophe claims. The nancial commitment by Farm Mutual Re has been critical in responding to these losses. There was also a review of the importance of ensuring insurance to value and keeping up with ination.JP’s report included the challenges in the global reinsurance market over the past few years and the potential for shrinking capacity. He also reviewed the AM Best rating of Farm Mutual Re and some organizational changes underway.Farm Mutual Re CFO, Amy Butler provided an update on year-to-date results.Farm Mutual Re then convened a panel of reinsurers including Olivier Gay of SCOR Canada and Agis Kitsikis of Swiss Re, with Jonathan Stephenson of Guy Carpenter as moderator. This insightful discussion provided context on risk management by reinsurers, allocation of capital, and the general sentiment of the reinsurance market after a number of difcult years. The afternoon sessions kicked off with Justin Ramkishun of JD Power. He provided an overview of the Canadian automotive market with insight into tightening automobile nancing conditions, Canadian’s ongoing afnity for pick-up trucks despite the increased price of fuel, and the adoption of electric vehicle technology by automobile producers.The closing keynote, Peter Katz, took us on a personal and musical journey on connecting with personal goals and wellbeing and making a difference to others while building our own resilience.Steve Quinn closed the 2022 P&M and invited delegates to the 2023 Annual Convention in Toronto and the 2023 Presidents & Managers meeting in London, Ontario.

Page 10

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT10OMIA AWARDSWe’re pleased to continue our long-held tradition of recognizing mutual members for their contributions to our community. In 2022, after a hiatus due to pandemic restrictions, we were able to award three Distinguished Service Awards and two Presidential Merit Awards. We also awarded four reghters with Medals of Merit.

Page 11

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT11Nancy Preston began her career in the Claims Department of the Cooperators but joined the mutuals in 1996 when she took a position at Blanchard Mutual in St Marys. Blanchard Mutual merged with Downie Mutual to become Tradition Mutual and in October 2002 Nancy answered when opportunity knocked, and was appointed as Manager of Middlesex Mutual in Ilderton, Ontario.Nancy was known as an excellent leader and mentor, and always gave her best to Middlesex and to her fellow mutuals. She contributed generously to OMIA’s Education Committee, the Auto Rate Filing Committee, and MCCG’s Development Steering Committee.She also did extensive work in the community, leading Middlesex Mutual’s support of the Terry Fox Run, the Ilderton, Parkhill and Thorndale Fairs, the London Farm Show, area food banks, the International Plowing Match and Middlesex Mutual’s own annual community BBQ. Invariably, Nancy’s generosity of spirit was accompanied by her infectious laughter at many mutual gatherings. Nancy Preston retired as the CEO of Middlesex Mutual in 2021.Nancy was nominated by Middlesex Mutual and North Blenheim Mutual.Terrye Calnan retired from a long and admirable career with HTM Insurance Company in June 2020. In 34 years with HTM, Terrye lled positions of increasing responsibility and worked tirelessly for and with her colleagues at HTM.Terrye was known to her mutual colleagues for her willingness to pitch in and help, to provide advice, and to provide straightforward feedback on ideas and problems as they came up, or as Terrye would say, “Just saying it as it is!”Terrye spent many years helping guide the Slocki computer system with her involvement on their Development Committee. She also played an important role at Mutual Concept Computer Group (MCCG) serving on their board from 2006 to 2016 and as Chair from 2011 to 2013.Terrye gave her time and wisdom willingly to OMIA, serving on OMIA’s Benets Committee from 2010 to 2020. She was also an active contributor to the Accountants Roundtable at OMIA.Terrye unfailingly committed herself to education over the course of her career, obtaining her CIP, FCIP and Risk Management designations. She helped with transitions at HTM for four different CEOs and helped, encouraged, and supported her co-workers throughout her career.Terrye was nominated by HTM Insurance and Bay of Quinte Mutual.DISTINGUISHED SERVICE AWARDOMIA Annual Convention, March 2022OMIA’s return to an in-person convention in March 2022 allowed for us to recognize two long time members of the mutual community with the Distinguished Service Award. This award is presented to retired individuals who have made a signicant contribution to the farm mutual system over the course of their career.While traditionally presented at the President & Managers Meeting, our 35th and 36th award recipients were honoured during the awards luncheon at the 2022 Annual General Meeting at the Sheraton Centre Hotel, Toronto.OMIA President, John Taylor & Nancy Preston Terrye Calnan & Nancy Preston

Page 12

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT12Jim Pinnock was the recipient of the Distinguished Service Award at the 2022 Presidents and Managers meeting held at the Blue Mountain Village in October.Due to health challenges Jim and his wife Lorna were unable to attend the P&M, however we were honoured to have special guests from Fredericton, Jody Pinnock, Tara Pinnock MacKinnon, and Audrey Pinnock join us to accept the award on Jim’s behalf. Jim was the long-time CEO and President of Stanley Mutual. After his retirement as CEO, he returned to the board of Stanley Mutual before a sudden stroke forced his retirement from the board.In nominating Jim, Stanley Mutual described him as “the face of mutuality in the Maritimes”. Jim’s mutual career originated as a major career change for him, one that he jumped into wholeheartedly.Early on in his mutual career Jim took opportunities to seek advice and mentorship from others in the mutual family. They helped him hone his insurance skills and, as his career progressed, Jim channeled that early assistance back into his own willingness to help others at the start of their careers.Over his career, Jim’s efforts included serving on the board of directors of the National Association of Mutual Insurance Companies in the United States, the United General Insurance Corporation in Fredericton, and as Director and Chair of Farm Mutual Re in Cambridge. Jim’s year as chair was 1995-1996. Jim was also active on CAMIC’s Banking Committee in the 1990s.From a community standpoint, Jim made a tremendous difference in his hometown. He was a Stanley Village counsellor for eight years and was also on the board of Nashwaak Villa. Jim was the President of his local curling club and developed and coordinated the local Little Rock’s curling program. Derek MacFarlane, currently on the board of Stanley Mutual, provided his tribute to Jim and particularly the friendship and leadership that Jim and Lorna Pinnock provided in welcoming Derek and his wife Gail to the mutuals and setting them on the course for their own involvement in the mutual system.Jim’s children, Jody Pinnock and Tara Pinnock MacKinnon, shared Jim’s moving acceptance of the award, including his gratitude for this recognition but also his encouragement for others to work together as mutuals and to support and lead each other forward whatever challenges there may be. Jim also acknowledged the contributions of the many individuals who helped him on the way in a long and distinguished career. DISTINGUISHED SERVICE AWARDOMIA P&M Meeting, October 2022Fredericton, New Brunswick Blue Mountains, Ontario

Page 13

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT13Brian Downie has been well travelled, representing West Elgin and other mutual organizations throughout his long mutual career. He was born and raised on the Downie family farm in estern Elgin County.Brian graduated with an Honours Bachelor of Arts degree in Business Administration from the Ivy Business School at the University of Western Ontario in 1983. For several years he worked in banking and the retail farm equipment business before hearing his true calling to the insurance industry in 1991.Brian was hired as the Accountant at West Elgin Mutual in 1991 and promoted to Manager in 1997. He was active in completing his insurance education with the Canadian Insurance Accounting Association and through the Insurance Institute where he earned his CIP designation. He later followed that up with his FCIP designation and his Canadian Risk Manager designation. Brian’s contributions to mutual organizations have been extensive over the course of his 30-year mutual career.Brian was a founding director of Farm Mutual Financial Services and acted as Chair. He was also involved in the formation and launch of the Farm Mutual Pooled Funds serving as Chair of that Investment Committee for the lifetime of the funds. Perhaps Brian’s most signicant contributions to the farm mutual system was his time as Ontario Director at Large on the Farm Mutual Re board including his year as Chair in 2014-2015.While on the Farm Mutual Re board, Brian was involved in several important governance committees that realigned the governance structure to better address membership needs and the evolving complexity of nancial services governance.Brian has been a trustee of the Fire Mutual’s Guarantee Fund since 2015 and has served as Chair over the past year. He is also a current board member at Collectivde.In addition to these leadership positions, Brian has also devoted time to the Development Steering Committee at MCCG and served on the Auto Rate Filing Committee as well as OMIA’s Statistics Committee. In his home community, Brian has been a 4-H leader, served on the local fair board, and supported numerous community efforts.Brian is well known by his mutual colleagues for his ability to think through and analyze complex problems while maintaining a commonsense, grassroots approach and mutual perspective to any challenges that arise.PRESIDENTIAL MERIT AWARDOMIA Annual Convention, March 2022Each year the Presidential Merit Award is presented to an individual who is still active in the mutual system and exemplies the best elements of mutuality. Winners demonstrate a long-term commitment to mutuality and service to the association. Presidential Merit Award winners are knowledgeable, hardworking, and highly competent in their eld. They generously contribute to their fellow mutuals and have a favourable inuence on other members of the association. We were pleased to recognize two recipients of the award at the 2022 Annual Convention: Brian Downie of West Elgin Mutual (Salus Mutual as of Jan.1 2023) and Allan Hedley of Cayuga Mutual.Brian Downie & His Family

Page 14

Allan Hedley has made his contributions to the mutual community from the board table at Cayuga Mutual where he has served as a board member for over 30 years.The Hedley family have a long tradition of agricultural leadership and community service in Haldimand County. To the benet of the mutuals, Allan has applied that same dedication to leadership and service well beyond Haldimand.Allan served as the Group 5 Director for OMIA from 2008 to 2017.During his time on the OMIA board, Allan unselshly volunteered for a wide variety of assignments, many of which would not normally have been taken on by someone with a thriving and hectic farming and agricultural business through family-owned Hedley Seeds in Caneld.While a member of the OMIA board, Allan chaired the Legislative Affairs Committee and Roundtable and was Chair of the Legislative Affairs Roundtable when it undertook its rst annual Queen’s Park Day.This successful event, which brings mutual delegates together with MPPs, was an annual highlight, especially for those MPPs with mutuals in their riding. While in temporary limbo due to the pandemic, we’re pleased to return again in March 2023.Allan also chaired OMIA’s Marketing Committee and served as an OMIA pension trustee. In addition to his OMIA work, Allan and his wife Renee have been the lifelong leaders and supporters of 4-H and the Caledonia Fair Association.During his year as Chair, Allan’s theme was Integrity, Trust, Value - Harmonized in Action.For those who have had the good fortune to work with Allan, you know that he has been a shining example of each of those things in his business, personal, family and mutual life. PRESIDENTIAL MERIT AWARDOMIA Annual Convention, March 2022Allan Hedley (right) with 2021 OMIA Chair, John Stirk

Page 15

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT15FIREFIGHTERS MEDAL OF MERITOMIA Convention, March 2022It is the mission of the Fire Fighters Association of Ontario (FFAO) to provide representation, resources, and education to reghters across the whole diverse province of Ontario. The membership includes both volunteer and career reghters.Through the decades, the FFAO has provided countless hours of training and professional development and sponsored many positive changes for re services and the communities they protect.The Medal of Merit was created in partnership with OMIA in 1983 and may be awarded to any reghter in the province of Ontario for meritorious service above and beyond the call of duty. The rst recipient was Fireghter Gary Mugford of Toronto in 1984.Over the years, OMIA and the FFAO have been proud to honor members of the re services who have performed heroically in saving and protecting the lives of others.FFAO and OMIA were unable to recognize winners in 2020 and 2021, but we honoured four worthy heroes at the 2022 Annual Convention in Toronto. We were grateful that Retired Chief, Kevin McNeilly, Association President, and Fireghter Jamie Hiller, Board member and Medal of Merit Chairperson, were able to attend on behalf of the winners and on behalf of all the members of the FFAO. Jamie Hiller was also one of our award recipients.Fireghter Jamie Hiller, along with his daughter, were travelling north on Highway 6 near Fergus, Ontario when a vehicle pulled directly in front of them without warning. Fireghter Hiller had to take immediate action to avoid a collision. As he did, he noted that the driver was slumped against the driver’s side window. The vehicle continued across the highway and into a snowbank, partially blocking the highway. Using his own vehicle to set up a protective barrier by blocking oncoming trafc, Fireghter Hiller made several attempts to communicate with the unresponsive driver without success. He agged down an oncoming snowplow to call 911 and returned to the car in the snowbank. The doors were locked and the vehicle remained in drive with the unconscious driver’s foot on the accelerator. Fireghter Hiller, fearing the driver was in cardiac arrest and without regard for his own safety, smashed the rear passenger window and crawled inside the vehicle.Instructing bystanders to stand back, Fireghter Hiller reached through the seats, put the vehicle in the park position, and unlatched the driver’s door. Exiting the vehicle, he did a quick assessment of the driver and found that he was without vital signs. He pulled the driver from the vehicle and immediately proceeded to perform CPR. Another bystander stayed close to Mr. Hiller, relaying medical updates to a 911 dispatcher on her mobile phone.After performing several rounds of CPR by himself, paramedics arrived and Fireghter Hiller assisted paramedics in loading the driver into the ambulance where he continued performing CPR. The driver was debrillated three times in the ambulance before being transported to the local hospital with a pulse.The driver’s family were subsequently informed by doctors at Kitchener’s St. Mary’s Hospital Cardiac Unit, that the only reason their father was still alive, was thanks to the quick action by an off-duty reghter, who left the scene without leaving his name. That reghter was Jamie Hiller.

Page 16

Fireghter Andreas Fortis had just dropped his children off at school on a cold morning with an air temperature of -2 degrees Celsius before windchill in St Catherines. Shortly before that he had completed a difcult shift with Brampton Fire and Emergency Services. While driving over the 4th Avenue Bridge at 12 Mile Creek, he noticed a woman sitting on the side of the bridge facing out. Concerned, he turned his vehicle around to see if she needed help. As his vehicle approached she rolled forward off the bridge into the water, a drop of about 30 feet.12 Mile Creek is a fast-owing river with several rapids that passes through a Power Generating Station and is also classied as a fast water area. The water temperature on December 17th was recorded at 6.2 degrees Celsius.After calling 911, he turned onto Wellandvale Road and crossed the Wellandvale Bridge, trying to keep eye contact on her location. By this time there were several witnesses that were pointing to her location in the water.He continued on, trying to get ahead of the young woman, who had by now passed through two sets of rapids. Parking along the Merritt Trail, he exited the vehicle and ran about a quarter mile, with other witnesses, along the tree lined trail beside 12 Mile Creek looking for a location to enter the water and attempt a rescue. It should be noted, a water rescue on an emergency call would normally include a drysuit with thermal protection, a Rescue Technician Personal Floatation Device, a Water Rescue Helmet, a rope, and a water rescue team in support. Without any of this support, he told witnesses to “keep an eye on me” and entered the water wearing only a t-shirt, track pants and running shoes.By now the woman was roughly 65 feet from the river’s edge oating head up. She would drift a further 160 feet downriver before Fireghter Fortis could make contact and begin to swim back with her.They were assisted out of the water by two bystanders who provided their coats. The young woman was hypothermic when Niagara Emergency Medical Services and St. Catharines Fire Services arrived. She was transported to hospital where she made a full recovery.Fireghter Fortis also showed great concern for the bystanders who assisted with the rescue. After the incident, he contacted those individuals through social media, referring them to victim and peer support teams if they were struggling with the events of the day. Fireghter Fortis’s exemplary conduct in executing, without hesitation, a fast, cold, water rescue without any protective equipment saved a young, 22 year old married woman with a family from certain death. His actions that day demonstrates his commitment to the modern re service motto, “I am not here for me; I am here for we and we are here for them.”

Page 17

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT17Fireghter Matt Dickison will humbly tell you that he was in the right place at the right time after saving a man’s life.Shortly before midnight, 37 year-old Fireghter Dickison and his wife Michelle, were travelling County Road 23 north of Grafton Ontario when they spotted a vehicle in the ditch.Fireghter Dickison went to see if the driver needed assistance and immediately noted that the accelerator of the car in the ditch was at full throttle. In his words, “You could hear the stones ying off our car.”Fireghter Dickison saw an unresponsive male in the drivers seat. The doors were locked, but the window was open enough to allow him to reach in and unlock the door.He had just entered the vehicle, but had not begun to extract the driver when the vehicle caught re. Running back to his own car, he instructed Michelle to call 911 and returned to extract the driver. Back at the victim’s car, he had just managed to get the driver upright and unbuckled when the whole car caught re. Fireghter Dickison realized the situation required even faster action as he struggled with the driver’s 180 pounds. The cold air helped bring the driver partially around and at that point the driver indicated that there was also a dog in the car. Entering the car yet one more time, Fireghter Dickison rescued a small Husky dog from the back. At this point the car re was fully involved in ames.Given the time of night and how few vehicles were on that road, there is no doubt that Fireghter Matt Dickison saved the driver and dog from death or critical injury. It should also be noted that Fireghter Dickison had only been an Alnwick/Haldimand Township reghter for just over a year. Fireghter Matt DeVries was responding to the Waineet re station for an accident call involving a motorcycle and pickup truck at the intersection of Forks Road and Highway 3. As fate would have it, Fireghter DeVries came upon the accident on his way to the station.A 60-year-old male motorcyclist had struck a pickup truck turning across his path. Thrown from the bike by the collision, he sustained traumatic life-threatening injuries and was bleeding profusely due to his leg having been severed below the knee.With no medical equipment or personal protective equipment, Fireghter DeVries immediately attended to the motorcyclist’s injuries by fashioning a tourniquet out of a belt to slow blood loss from the severed leg and then worked to prevent shock from setting in.While performing rst aid, Matt updated 911 dispatch on the severity of the injuries and requested an air ambulance.Waineet Fire Rescue arrived on scene several minutes later followed by Ambulance services.Within seconds of arriving at the scene, Matt DeVries had acted decisively to secure the scene, render lifesaving rst aid, and call in critical air ambulance support. Lieutenant Jay Mous of the Waineet Fire Department later identied Matt’s quick thinking and training for saving the motorcyclist’s life.It’s with pride that we acknowledge the fourth recipient of the 2022 Fireghters Association of Ontario Medal of Merit, Fireghter Matt DeVries.This award is open to volunteer re departments across Ontario and nominations may be made from any individual to the Fireghters Association of Ontario.The nomination form can be accessed on the Fireghters Association of Ontario website

Page 18

2022 COMMITTEE REPORTSThe 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.

Page 19

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT19Committee Focus The Accounting Advisory Committee monitors the accounting and nancial reporting environment and develops solutions and approaches for member companies to address new and changing requirements. The areas covered include International Financial Reporting Standards (IFRS), statutory nancial reporting forms required by the regulators, requirements of the General Insurance Statistical Agency (GISA), taxation (both federal and provincial) – essentially any topic where the information required must be delivered to, or extracted from, the member company accounting and nancial systems. The committee is a liaison with the Financial Review Committee, the Accountants’ Roundtable, and key partners and nancial reporting experts. The Roundtable is composed of member company staff and management who are responsible for nancial 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 2022, much of the committee focus continued to be on implementation of IFRS-17. IFRS-17 – Getting Ready IFRS-17 implementation dates were pushed back several times, but with the announcement in 2020 of a January 1, 2023 effective date, 2022 became a key year for committee work, as 2022 became the “comparative year” for transitioning from old to new. This has been a multi-year path and there have been many milestones along the way. In April 2018, the Accounting Advisory Committee launched a Gap Analysis Project with Ernst & Young (E&Y). The Committee launched this gap analysis as a precursor to developing more detailed implementation plans. Partnering with E&Y on the gap analysis process also provided insight into the mandatory actuarial work that will be required under IFRS-17 in addition to the changes in accounting policies, processes, and reporting.IFRS-17 has introduced new terminology and denitions 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 nancial reports. IFRS-17 will completely change nancial reporting and the Accounting Advisory Committee has identied an opportunity to recommend standardization of accounting treatments and approaches to nancial reporting among the mutuals.In 2019, a 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 nancial statements. In 2022, this group model was successfully launched, as the process of creating comparative nancial statements got underway.The Accounting Advisory Committee also worked with mutual auditors and other partners, such as E&Y, to develop recommended wording and approaches on:• Accounting treatments and policies• Chart of accounts• Accounting for reinsurance premium and proceeds• Guideline on level of aggregation• Guidelines on identifying onerous contractsMandate - to assist member companies in meeting requirements for audit and nancial reporting.Accounting Advisory Committee ReportChair, Andrea Schaefer, Axiom Mutual2022 Committee Members Christine Van Daele (Westminster), Dave Paterson (Ayr), Traci Radford (West Wawanosh), Kevin Konecny (K&E), Catherine MacLellan (FRC), Bob Nielson (FRC), Bob Brown (Farm Mutual Re), Amy Butler (Farm Mutual Re), Sharon Dittmer (OMIA), Susan Baker (OMIA)continued on next page

Page 20

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT20• Aggregated approaches to data collection for actuarial services• Recommendations on accounting for policy acquisition costs• Shared resources for management and board training on IFRS-17• Shared resources for actuarial servicesIn 2021, the committee continued to work on IFRS-17 readiness by developing position papers shared with mutuals participating in the group actuarial services project. All draft position papers are posted to the OMIA Members’ Website for members to review. In its work to date, the Accounting Advisory Committee has included representatives from each policy management system to provide guidance on what system changes are required for data collection and nancial reporting. The committee has also worked closely with mutual auditors to ensure decisions are acceptable to our audit partners. With the assistance from OMIA Statistics, the committee completed its work with three mutuals as test companies to ensure that the Actuary will receive premiums and claims data to provide the required actuarial services under IFRS-17.In 2022, the committee continued to work on nalizing position papers and working with mutuals to provide data to the Actuary to complete the 2023 P&C 1s and to prepare IFRS-17 nancial statements. 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.With the end of 2022, charter committee member Traci Radford, will be stepping off the committee. She has contributed greatly since “Day 1” of the committee, and we are grateful for those contributions. The work of the Accounting Advisory Committee has been critical in assuring our regulator, FSRA, that despite the extreme level of complexity involved in the IFRS-17 transition, our mutuals are well prepared, well positioned, and well-resourced for the new Standard. The work of the Accounting Advisory Committee has been critical in assuring our regulator, FSRA, that despite the extreme level of complexity involved in the IFRS-17 transition our mutuals are well prepared, well positioned, and well-resourced for the new standard. Background The Auto Rate Filing Committee represents the group of OMIA companies that underwrite automobile insurance in Ontario and have elected to do a common ling 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.Mandate - To lead member companies in working together to create a sustainable and protable auto product oered at competitive rates to meet the unique needs of mutual policyholders.Auto Rate Filing Committee ReportChair, Warren Ting, HTM Insurance2022 Committee Members Shelley Deyo (North Blenheim), Marg Torrance (Halwell), Tracy MacDonald (Trillium), Jodi Meiering (Ayr), Paul Burns (Tradition), Tyler Kroetsch (OMAP), Jeff Ferguson (OMIA), Christine Senior (OMIA) continued on next page

Page 21

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT21MissionWe provide auto insurance solutions and services uniquely tailored and priced to the need of customers in the mutual community. VisionTo enable our member companies to be the insurer of choice in their respective communities.Strategic Directions1. Grow ProtablyIncrease Auto GWP and PIF reduce Auto Loss Ratio by supplementing our expertise in our mutual communities with data-driven underwriting and rate segmentation insights using the combined scale of our member insurers. Improving the accessibility of our products to customers, agents, and brokers, while retaining our protable target customer base.2. Trusted PartnerMaintain our role as a trusted partner to our policyholders, with best-in-industry retention rates. Build on our reputation in our mutual communities through offering a thorough suite of automobile insurance products that meet the unique and diverse needs of our neighbours. Integrate OMAP within the Ontario Mutuals as a center of excellence for everything Auto-related.3. Strengthen People, Communication, and CultureCreate and grow a best-in-class Auto team that supports our member mutual insurers. Perpetuate a strong feedback loop with our member mutual insurers and their distribution networks to facilitate business management and ensure our rates and rules reect our culture, values, and strategy.4. Adapt for the FutureInvest in the technology required to be a leading insurer and develop a foundation to continue to evolve. Build exibility that enables a fast-follow strategy and supports increasing the scale of mutual auto business. Be willing to innovate in our target market, leading the industry with products for rural auto business.Rule #4In October 2022, OMAP was notied that our Rule #4 (Persons who will reside in areas not serviced by the company) was not in compliance with the Insurance Act. OMAP has applied for an exemption to the Superintendent of Insurance.Projects and Rate FilingsDate ActionsFebruary 2023 Private Passenger, Commercial 0.0%Future Date ActionsQ3 2023 Private Passenger (TBD)

Page 22

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT22Background 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, 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 benets and creating more stringent claims handling regulations. The Ontario auto insurance system has been described as evolving toward a “social safety net.” Over time this has created a very generous insurance product with benets that exceed those of any other province in Canada. In addition, the stringent rules governing pricing, selection, policy terms, and claims processes have created a highly complex environment for both insurers and policyholders. This in turn has led to more involvement of legal counsel on behalf of policyholders and an adversarial environment for auto claims. The onset of the pandemic in 2020 created a temporary “adjustment” as lockdown conditions radically changed driving patterns and driver expectations. By late 2022, we saw a signicant return to normal driving patterns, but the impact of the pandemic remains incomplete and much about Ontario auto remains “on pause” as a result. Behind the scenes, however, the government has been consulting on a wide range of potential changes relating to modernizing auto insurance. The report that follows reects the variety of issues requiring an OMIA response.Automobile Insurance Emerges from the PandemicThe committee monitored many issues in automobile insurance throughout 2022. From a public policy standpoint, the most signicant question was how stakeholders in the automobile insurance sector including the provincial government, FSRA, auto insurers, suppliers, and policyholders will pull together the threads of all the issues that emerged during the pandemic.Throughout 2022 a common theme for discussion was whether driving behaviours in Ontario and trafc volume had returned to normal. The general sense was that they had, and increased claims frequency was driving costs upward with resultant pressure on price. Supply chain issues and inationary trends in repairing vehicle damage claims remained stubbornly troublesome. This has included pressure on loss of use claims where rental periods for replacement automobiles have been extended from days to weeks to months.Whereas physical damage claims had been the most stable elements of the automobile product, they have been among the most difcult to deal with in exiting the pandemic. The need for increased premium creates a difcult public discussion on the affordability of automobile insurance. Everyone is experiencing the impact of ination on household budgets. Automobile insurance is a signicant portion of that budget and in Ontario is the most expensive of any Canadian province. This inevitably collides with consumer backlash on the cost of insurance. This debate is amplied by MPPs who use auto insurance as a wedge issue. So, while the cost of providing automobile insurance remains high, short of product reform, there are no obvious solutions to affordability. Mandate  To develop OMIA’s position on auto insurance issues and communicate with the industry, regulators, and legislative ministries.Automobile Committee ReportChair, Terry Knight, North Blenheim Mutual2022 Committee Members Kelly Jackson (Westminster), Linda Pereira (Lambton), Lisa Fazzari (Farm Mutual Re), Jon Hodson (Farm Mutual Re), John Taylor (OMIA), Susan Baker (OMIA), Janet Schmidt (OMIA)

Page 23

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT23Territorial Rating In Ontario, insurers are allowed to charge differential rates based on “territories.” They can only use a limited number of territories and must dene these in rate lings made with FSRA. The use of territories has always been considered an appropriate and fair way to identify and charge for the higher risks associated with driving in areas where accident frequency and severity is higher. Over the last several years, there has been a loud debate led by MPPs representing the higher cost Toronto and GTA areas for auto insurance. The government has repeatedly indicated their wish to address territories but have not been specic as to whether this will involve banning the use of territories or whether it will allow an expanded and exible use of territories that might better represent risk allocation. In any event, OMIA has strongly advocated for the continued use of territories, as banning them will undoubtedly result in drivers in rural, lower trafc areas subsidizing drivers in higher risk urban areas. FSRA has also signaled a much deeper examination of “fairness” in auto pricing, which promises to eventually go well beyond territorial considerations. Towing and Storage – Fraud and AbuseThe government introduced a series of pilot measures to address concerns over fraud when high cost towing and storage services are forced upon drivers at accident scenes. This was particularly prevalent on major highways in the Toronto area. OMIA has a Towing and Storage Working Group which has provided feedback to the Ministry of Transportation and others. We continue to monitor these patterns closely but are hopeful that, should the government pilot measures on policing towing and storage be extended across the province, there should be a positive impact.The License Appeal TribunalSeveral years ago, dispute resolution moved from FSCO to the License Appeal Tribunal (LAT). The LAT was a body the province had in place previously for a range of matters requiring adjudication outside the court system. This was seen as a positive move that might remove some dispute resolution pressure from the regulator and increase both the effectiveness and speed of dispute resolution.Unfortunately, signicant problems have been reported with the LAT, mostly related to delays in having cases dealt with. There appears to be a lack of available resources and a huge backlog of disputes. This is exacerbated by the concern that those bringing claims before the LAT are unprepared to exchange information and work towards a timely resolution. There is also concern that the expertise on the LAT may not be as effective in dealing with statutory accident benet disputes as with other matters. Much of this is out of the control of the insurance sector, although the sector has repeatedly brought it to the attention of the regulator. What is within the control of insurers is the ability to proactively investigate and settle cases, particularly those involving serious injuries. Being proactive and open to settlement in early stages typically can result in better long-term results and more effective reserve management.Optional Coverage for Direct Compensation Property DamageDirect Compensation Property Damage (DCPD) is a straightforward and mandatory coverage in Ontario auto insurance policies. The government felt that making this an optional coverage would allow consumers more choice and give them the potential to reduce the overall cost of their insurance.OMIA expressed concerns over removing this coverage, particularly as individuals who are not at fault in an accident and do not have this coverage will not be able to recover damages to their vehicle. Nonetheless, the Government has moved ahead with an implementation date for 2024. Changes will be required in 2023 to prepare for changes to wordings, process, and policyholder advice.Auto PlusFor many years, the insurance industry has used a third-party information technology vendor to provide driver records and other information that is important for underwriting and pricing automobile policies. Due to concerns with the existing system, the Insurance Bureau of Canada has led a cooperative effort to create a non-prot equivalent to obtain the same underwriting information. OMIA has subscribed to this on behalf of members and looks forward to the Auto Plus system in 2023, which should result in better security and lower costs. continued on next page

Page 24

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT24“Take All Comers” A major initiative from FSRA was a directive to the industry that they would strictly monitor and enforce the interpretation of the “take all comers” rule. This rule requires all insurers in Ontario to offer insurance to any qualifying applicant based on the insurers published rates. In early 2022, all insurers were required to self-evaluate their compliance with Take All Comers. OMIA, working with the Ontario Mutual Automobile Insurance Plan (OMAP) and the Auto Rate Filing Committee, put together a toolkit and approach that allowed each mutual to understand their own compliance with Take All Comers and make an appropriate self-assessment. FSRA has characterized all of this work as a “thematic” review, but have not provided a lot of details on the outcome of their increased monitoring, potentially because any deciencies are being remedied on a good faith basis. We anticipate that this will continue to be a closely watched topic. Fair Treatment of Consumers – Market Conduct Examination for Automobile Insurance In conjunction with their efforts on Take All Comers, FSRA launched insurer examinations in 2022. This involved requesting comprehensive documentation from selected insurers with an assessment of the adequacy of each insurers policies, procedures and controls as related to ensuring that all aspects of automobile insurance, from application through to termination, were fairly handled. An Ontario mutual was selected as a company for examination. They have generously shared much of their experience in undergoing this process, including some preliminary lessons learned, with other mutuals to allow for a greater understanding of the expectations and any potential gaps that may currently exist. A nal report is not yet available. Tomec versus EconomicalOver the past two years, OMIA and Farm Mutual Re have asked all mutuals to provide data on the impact of this court decision which removed some of the time limits on certain types of Statutory Accident Benet Schedule claims. We thank all mutuals for their participation in this. A nal round of surveys was completed at mid-year and a nal report published in early 2023. While there remain concerns with the Tomec versus Economical decision, it was determined there was no material impact on existing claims for mutuals in the aggregate. Looking Ahead With a government that has not been shy about commenting publicly on the affordability of automobile insurance, and with this government in the early part of its mandate, we believe changes to the automobile product are more likely to take place. Changes to the automobile product typically have a long implementation period due to complexity and the need to preserve existing legal rights and ensure an orderly transition. We expect automobile insurance will continue to be a front door “political” topic in 2023. We expect continued consultation from the Regulator as related to the use of territories in underwriting automobile insurance in Ontario. We believe that there has been much study done on the potential to move towards a different approach on territories. We believe that any changes related to territories however will be looked at through the lens of overall “fairness” for automobile insurance consumers.We also believe that more market conduct examinations at the individual organizational level will take place and some mutuals will be included.

Page 25

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT25The following chart summarizes the participation level in OMIA programs as at January 1st 2023.Pension PlanAsset Liability Modelling and Plan Design ChangesThe Plan is undergoing a multi-phase 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 efciently the assets in the Plan were matched against the 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 funded and earned by beneciaries. A report on the work to date along with suggested changes to Plan design was provided to member companies in the fall of 2018.Mandate -To provide guidance on issues related to employee benet programs and company benet programs that are available to the membership through OMIA.Benets Committee ReportChair, Tracy Wintermute, Westminster Mutual2022 Committee Members Steve Quinn (Cayuga), Jeff Howell (Bay of Quinte), Teresa Martin (North Blenheim), Jennifer Allan (Farm Mutual Re), Sharon Dittmer (OMIA), John Taylor (OMIA)Individuals # CompaniesEmployees Life package –Life/LTD/AD&D 1,313 45Short Term Disability 151 4Critical Illness 991 31Directors Life 171 24Dependant Life - Employees 1,084 45Dependant Life - Directors 162 24Directors AD&D 258 34Health Spending Account (HSA) 687 16Health & DentalPlan A - BasicPlan B - Basic & MajorPlan C - Basic & Major and Child OrthoTOTAL Health & Dental951331,1531,3813113044PensionDened BenetDened Contribution3879273141Directors & Ofcers - with ICPP 0 39Directors & Ofcers - without ICPP 0 1Bond 1,810 38E&O - P&C Agents 324 41Cyber Liability 0 32continued on next page

Page 26

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT26Information sessions were held in December 2018 and 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 nd 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 Dened Benet (DB) Pension Plan effective January 1st, 2022:1. The DB pension formula will change to 1.5% x credited service x nal 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 Dened Benet 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 Dened Benet Pension Plan. In November of 2019, a legal notice of upcoming pension plan changes was distributed to all participating active members of the Dened Benet Pension Plan. With these changes formalized, OMIA and the plan actuary are revisiting and updating the study.Pension Plan TextThe Plan Text was restated January 1st, 2021, incorporating all prior amendments to the previous plan text. In addition, we claried terms and references with the text to ensure compliance with Canada Revenue Agency interpretations on payment of pension benets.Annual Plan Review – Dened Benet Pension PlanThis review is completed by OMIA, as Plan Administrator, and LifeWorks (previously 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 eld. Member companies were provided with written conrmation of the OMIA Plan’s compliance in September 2022. Next review to take place in September 2023. Stewardship Review – Dened Contribution Pension PlanOMIA, as Plan Administrator, and Canada Life, as Plan Manager, review the Dened Contribution (DC) Plan for stewardship and compliance annually. This report provides feedback to OMIA on the design of the Plan and the services available to employees in the Dened Contribution Plan, as compared to pension industry trends and best practices. The review, completed in November 2022, conrmed OMIA’s DC Plan design and processes meet best practices. The next review will take place in November 2023.Pension ValuationThe OMIA Board of Directors elected to le an “early” valuation due to the signicant improvement to the funded position of the Plan based on guidance from the actuaries, interest rate environment, the Plan membership information as of December 31, 2021, and various other actuarial assumptions and legislative changes with respect to the funding of pension plans. Results of that valuation revealed a small surplus on a solvency basis: therefore no special payments were required. The next mandated valuation is required for the period ending December 31, 2024. The December 31, 2021, valuation also indicated a required decrease to the employer normal cost, effective January 1, 2022, to 4.82% bringing the total employer contribution rate to 13.82% (9.0% + 4.82%). Transfer Status of Dened Benet Pension PlanAt the onset of the COVID-19 pandemic, nancial markets reacted with a signicant decline in equity markets. Dened Benet pension plans have signicant exposure to equity markets and the decrease in underlying asset values affects the funded status of pension plans. In early 2020, the Financial Services Regulatory Authority of Ontario (“FSRA”) introduced regulations that restricted the ability of any plan to transfer lumpsum pension entitlements to terminating members. The purpose of the regulation was to ensure plans have sufcient capacity to protect all members following signicant declines in funded status. One of the regulations stipulated that if the transfer ratio of a pension plan at the end of a quarter deteriorated by more than 10% since the last valuation led with the regulator, the plan could not process the payment of lumpsum pension entitlements for terminating members without rst obtaining approval from FSRA. Following the market volatility that started in March 2020, a majority of the Dened Benet pension plans experienced signicant deterioration in asset values and funded status at the end of Q1 2020. Our own plan’s transfer ratio as at March 31, 2020 was 77.3%. As this represented a decrease of more than 10% from the last reported transfer ratio of the plan (92.3% as reported in the January 1, 2018 funding valuation report) it triggered the new “hold back” regulation. As a result OMIA, as Plan Administrator, was required to request FSRA’s approval to allow lumpsum commuted value transfer payments to continue from the plan for terminating members. At that time, FSRA only approved commuted value transfer payments capped at the most recent transfer ratio of 77.3%.

Page 27

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT27continued on next pageThe remaining 22.7% of commuted value owing to terminating members could only be made subject to a sponsor top up payment or could also be paid within ve years if the transfer ratio improved to the most recently led transfer ratio of 92.3%.For those terminating members who elected a lump sum payment, OMIA proceeded with transfers at 77.3% of the lump sum owing. This hold back provision only applied to members electing the lumpsum transfer option upon termination or retirement and had no impact on terminating members who elected annuity options (it will also have no effect on any DC Plan members).In 2020 and 2021, the OMIA Board elected to make a funding call to allow for the release of funds being held back in each of these years. For the rst three quarters of 2022, the plan has continued to pay lumpsum transfers at 77.3%, holding back the remaining 22.7%. Mid-year, due to the improved funded position of the plan arising from favourable liability development, OMIA led a formal valuation which reected an increased transfer ratio such that all outstanding holdbacks in 2022, plus interest, could be paid out prior to December 31, 2022 and going forward all transfer payments could be paid out at 100%. This meant there was no special funding call in 2022. Rate of Return – Dened Benet Pension PlanThe 2022 annual return on assets as at December 31, 2021 was -5.93%. Assets Under Management totaled $203,741,170.Employee BenetsHealth and Dental CoverageThe OMIA Health and Dental Plan operates under an ASO (Administrative Services Only) model. In an ASO model, participating companies essentially self-insure 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 benet plan, while also ensuring claims are adjudicated at arm’s-length on a condential basis. The OMIA Benets Committee monitors the ASO claims experience history, changes in participation levels, and claims utilization data. The committee also provides input on benets issues that are brought forward by member companies and monitors the ASO target reserve. In 2021, the committee reviewed the target reserve set in 2019 and recommended increasing the current target level over the next ve years. Some of the items and trends of interest this year have been:• Long Term Disability (LTD) rates decreased by 15% at the 2023 renewal. Sun Life instituted a new disability incidence factor in 2021 for calculating LTD rates and OMIA experienced a rate decrease even with the inclusion of the new incidence factor. The incidence factor accounts for the signicant increases in LTD claims across Sun Life’s block of business, largely related to mental health claims. OMIA’s overall LTD claims experience continues to be better than the experience in Sun Life’s block of business.• The OMIA Benets Plan experienced a decrease in health and dental claims in the rst half of 2020 due to the COVID-19 pandemic, however by December 2020 claims were trending to what the plan experienced pre-pandemic. By December 2021, Health and Dental claims increased back to the levels seen in 2019. Claims continued to increase in 2022 and are expected to continue increasing in future years. • Health and Dental claims costs are expected to continue to rise, especially with the continued increases in CPI. The Benets Committee closely monitors this trend and potential methods to reduce claims costs, while still providing a competitive benets package. OMIA continues to use the ASO reserve to offset increased claims costs.• 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 condential. • 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.Lumino Health Virtual Care Effective January 1, 2023, Lumino Health Virtual Care was added to the Health and Dental coverage. Lumino Health Virtual Care gives members and eligible dependents (including

Page 28

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT28spouses) access to healthcare professionals via a mobile or web app. Members are able to chat with a nurse for any health questions or consult a doctor via a secure video if a diagnosis or prescription is required, completely free of charge. Members can also consult other health professionals (e.g. nutritionists) for an additional fee that may be covered by insurance. This service is available 24/7. Increased Paramedical Coverage Effective January 1, 2022, the annual limit for paramedical coverage increased to $750 / person / year / paramedical category (was previously $500 / person / year / paramedical category). Paramedical coverage is limited to an overall annual maximum of $2,000 for all paramedical claims, with the exception of claims for physiotherapy and mental health professionals. • Coverage for physiotherapy remains at $4,000 / year / person.• Coverage for mental health professionals remains at an aggregate limit of $1,200 / year / person. This limit is shared between the 5 categories of mental health providers covered by the plan; psychologist, psychiatrist, psychotherapist, social worker, and clinical counsellor.Health Spending Account (HSA) Effective January 1, 2021, companies were given the option to enroll in a Health Spending Account (HSA) through Sun Life and the OMIA Benets Department. Many companies have since taken advantage of this option. The overall experience for those that offer the HSA has been positive, with companies and members appreciating the ease of administration and claims submission. Companies have the option to enroll their staff in the HSA every January 1st. Please contact the OMIA Benets Department for additional information: benets@omia.comMember Education SessionsOMIA provided virtual benets and pension education sessions to employees, agents, and directors throughout 2021. Additional education sessions included webinars about the Sun Life member’s website and mobile app, and presentations on the Employee and Family Assistance Plan (EFAP) and the Lumino Health resources available on the Sun Life member’s website. OMIA will continue monitoring the needs of our members and is open to scheduling education sessions on additional topics. OMIA staff are available to provide virtual presentations on the OMIA Benets and Pension plans at no cost to your company. Companies continue taking advantage of this option and, in 2022, the OMIA Benets Department scheduled presentations for ve member companies. Companies wishing to schedule a presentation should contact the OMIA Benets Department. In-person presentations resumed as of the third quarter of 2022. Company BenetsAgents Errors and OmissionsThe Agents Errors and Omissions program renewed with no increase in premium rates in 2022. It should be noted that OMIA’s E&O program has received “as-is” premium renewals since the 2015-2016 renewal. Please refer to the E&O renewal mailout in August 2022 for complete details. Directors and Ofcers InsuranceThe Directors and Ofcers Insurance continues to be well utilized with 40 companies participating in 2022. 2021 saw an increase in premiums due to a hard market.Cyber Liability InsuranceCyber Liability Insurance was introduced late in 2015. Currently, 32 companies have added this coverage. 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. 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. We continue to see an increase in premiums due to the frequency and severity of cyber events in general.Compensation and Benets Survey The bi-annual Compensation and Benets Survey was completed in 2021 and results were shared among participating companies prior to September 30, 2021. A total of 47 companies participated in 2021. The survey will be offered again in 2023.

Page 29

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT29HR Roundtable The Association provides members the opportunity to participate in an HR Roundtable that is held twice a year. The HR Roundtable provides education and discussions on HR trends and challenges. Over the last couple of years, topics covered at the HR Roundtable include building a culture of safety as employees return to the workplace, psychological health & safety in the workplace, managing virtual teams, and employer accommodation requirements during the COVID-19 pandemic. OMIA Website Some key features of the OMIA member’s website include the ability to send a secure message directly to the OMIA Benets Department without going over the worldwide web, a library of application forms, HR document samples, HR manual samples, company administration manuals for benets and pension, HR Leadership Forum newsletters, prior mailouts and links to various government and benet carrier websites.The company administration manuals for Benets and Pension are also available on the website. Both manuals are updated annually and can be found at under Member Resources > Information for HR Administrators.Looking Ahead The Benets 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 identied:• Evaluating and enhancing plan user knowledge of the benets program;• Providing cost-effective, labour market competitive benet plans for member mutuals;• Upgrading OMIA’s current benet software to improve efciency, adopt best practices, and meet data reporting requirements.These strategies have been incorporated into the OMIA Strategic plan.

Page 30

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT30Strategic 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. Determine feasibility of a Property Rate Working Group Model• Several companies have identied an interest in using our collective data to advance property rating.2. Increase, maintain, and govern the OMIA centralized database for the benet of regulators and Farm Mutual Re• Enhanced data collection and improving member experience• A dedicated collection process for IFRS-17 and P&C 1 lings• Ongoing improvements to the OMIA centralized database, software, and hardware3. Improve data utilization and analysis for business intelligence needs• Improvements to business intelligence solutions including leveraging 3rd party data• Working to provide predictive analytic capabilities across all lines of business4. Enable member company efciencies on data collection and reporting • Work to eliminate any manual reporting• Look for alternate methods of capturing data to bring efciencies to member company reportingIn 2023 and beyond, the committee, along with Farm Mutual Re, will continue to pursue analytic capabilities:Integrating Improvements in Residential Rating • A pilot project has just been completed with two member companies to examine the feasibility of incorporating residential rating improvements. Some of the key ndings include:o It is challenging to identify a predictive signal on an individual’s own data. However, the aggregate data is sufcient. o Property data capture at both the individual policy management system and the aggregate data appears to be insufcient. More data needs to be captured.o The efforts of Farm Mutual Re and their peril scoring research are compelling. Peril scoring likely needs to form a part of each company’s rating methodology o Current rating algorithms are likely too simple and could be improved just by adding in additional rating variables such as peril/credit score, a geographic component, or additional building attributes.In 2023 and beyond, OMIA Statistics will continue to support various compliance related initiatives, such as the move to IFRS-17, and changing FSRA requirements related to P&C 1 reporting.Vision – Better Data. Better Decisions. Knowledge Beyond Intuition. Mission – To facilitate data driven decision making.Data Strategy Committee ReportChair, Neil Shay, CTM Insurance2022 Committee Members Christine Van Daele (Westminster), Shelagh Cleary (Usborne & Hibbert), Tracy Campbell (Germania), Garth Driedger (My Mutual), Karen Byrne (Trillium), Jeff Ferguson (OMIA), Shawn Zhang (OMIA)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.

Page 31

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT31Training – Information Transfer – An Important Service Area OMIA’s Strategic Plan recognizes the work of the Education Committee as a key priority of our “Resource Centre” strategic goal. Our committee is attentive to our responsibility to move information out to member companies in an effective and timely manner. Knowledge is shared through the collaborative efforts of OMIA, OMAP, and Farm Mutual Re teams, as well as staff from member companies and third-party subject matter experts. 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.Demand for OMIA-led training courses was quite strong in 2022 with over 4,500 people attending over 160 different sessions. On-Demand Courses We continue to grow our portfolio of On Demand Courses with 19 available and several more underway. There are now seven courses available within the Directors Certication Program to allow directors to accelerate their learning. Several companies are also using the On Demand courses when onboarding new staff. A full listing of courses is available at: Certicate Program OMIA administers several certicates and has been working hard to refresh and keep them up to date. The Directors Certicate continues to be popular along with several discipline-based approaches. In 2022, the updated Agents, Underwriters, and Accident Benet Adjusters certications were released. OMIA will continue developing certications. You can nd more information at under Education > Certication Program.2023 Education Program Over 150 sessions covering a large breadth of subjects will be available in 2023. Please consult the education calendar on OMIA’s website. We will also be returning to in person training as people become comfortable gathering in groups. Virtual and hybrid training will however, remain a key component of knowledge transfer. On–Site & Multi-location Training OMIA staff are pleased to bring training programs to your company ofce either virtually or in-person. With few exceptions, anything we have done in person or online can be replicated or modied to meet your particular need.Mandate - To determine the courses that OMIA will provide and to deal with other issues related to training.Education Committee ReportChair, Steve Quinn, Cayuga Mutual2022 Committee Members Jerrod Boyse (Ayr), Dan Hill (Germania), Rob Pearson (Axiom), David Rutherford (HTM), Elizabeth Baker (Farm Mutual Re), Christine Senior (OMIA), Susan Baker (OMIA)

Page 32

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT32Legislative Affairs at OMIA The Ontario Mutuals have a unique place in the insurance landscape in Ontario. This is demonstrated by our mutuals’ commitment to the economic health of rural Ontario, local community causes, and direct policyholder participation in their mutual. Our commitment and mutual value system are well recognized, as MPPs see mutuals as an important part of a healthy and sustainable insurance system. The Legislative Affairs delegate at your mutual plays an important role in maintaining our prole with MPPs and MPs. These delegates act as ambassadors to the legislature and communicate effectively on the impact of proposed legislation. In some cases, our delegates provide an informal sounding board for MPPs and provide feedback on how government policies relating to insurance will affect policyholders. This is especially important during difcult markets, or when the availability and affordability of insurance coverage becomes an issue. Legislative Affairs delegates also provide information back to OMIA and fellow mutuals on important issues in their ridings that will have an impact, either locally or provincially. These early discussions on local issues can lead to broader discussions as issues migrate to other areas of the province. Local road safety concerns and trespass and activism on family farms are good examples of this type of issue. Delegates participate in two roundtables each year. The spring event takes place in early March with, when circumstances allow, a visit to Queen’s Park. 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. An 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.Spring 2022 Roundtable With lockdowns extending into the spring season, our annual trip to Queen’s Park was cancelled again in 2022. The Legislative Affairs Committee did convene a virtual spring roundtable on April 21, 2022. The spring roundtable was the rst opportunity for newly appointed Chair, Kevin Inglis to welcome and address a group of 40 delegates representing 26 member companies. To kick-off the roundtable, John Taylor reviewed OMIA’s Provincial Issues as updated ahead of the June spring election. Our four primary issues are:• Ontario Automobile Insurance • Ontario Building Code Review • Tort Reform • Small InsurersIssues relating to automobile insurance and tort reform should be familiar to many MPPs as these have been public policy topics for many years. As related to automobile insurance, our key message continues to be that true cost containment or improved affordability for Ontario drivers can only take place with signicant product reform. This has been a consistent industry message. The pandemic-related political pressure for rate reduction and ongoing discussion on removing territorial rating due to perceived bias, however, has served to increase the public policy debate on affordability and the cost of auto insurance. As related to the Ontario Building Code, our message continues to be that the province must take a leadership role in putting climate resilience features within the Building Code. This remains a difcult “sell” as there are other stakeholders who resist even nominal changes to the Building Code that may be seen to increase building complexity or impact the cost of housing. Mandate - To communicate the association’s position on legislative issues to our elected representativesLegislative Affairs Committee ReportChair, Kevin Inglis, Howick Mutual2022 Committee Members Allan Hedley (Cayuga), Brad Vanstone (West Wawanosh), Doug Crockett (Westminster), Ross Lamont (Trillium), Barbara Bethune (Nova), Scott Roung (Dumfries), Ed Forbes (Dufferin/Farm Mutual Re), John Taylor (OMIA)

Page 33

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT33Issue four, relating to small insurers, reects the pressure felt both nationally and provincially as regulators continue to make more demands on data, governance, and operational reporting. In addition, regulators appear to be increasingly proactive in requiring insurers to “prove” governance and market conduct controls without consideration to an insurer’s previous exemplary behaviour in these areas. The increased pressure on small insurers can be seen in many ways. FSRA assessment fees, for example, almost doubled between 2020 and 2021. In addition, to meet increasing demands for reporting, insurers must add signicant additional resources. Mutuals also report concerns with having to choose between focusing on policyholders and meeting regulatory expectations. The key message is that these additional costs brought by regulation will be borne by the policyholder and will increase the cost of insurance without any perceivable increase in benet or safety to policyholders. There was also an opportunity to review the recently introduced regulations concerning the sale of property and casualty insurance in credit union branches. Input from OMIA, the Insurance Brokers Association of Ontario, and other key stakeholders resulted in what is seen as improvements to regulations to maintain consumer protection from tied selling which may arise from the sale of insurance by deposit taking institutions.The Roundtable was also an opportunity to revisit the “Election Project”. Delegates were urged to make direct contact with candidates in the lead-up to the June election and to ensure follow-up with successful candidates following the election.Key steps in the election process include:• Working individually or in teams with neighboring mutuals to communicate the value of mutuals to their communities.• Using the Grassroots brochure and increasing awareness on the “Give Back” programs that the Ontario Mutuals implemented throughout the pandemic.Following a discussion on the election project, each company was also asked to provide reports on the key issues that were impacting their ridings. These included a wide range of issues, many of which were not insurance related. Here is a snapshot of some of the issues identied:• Housing availability and affordability • The 413 Highway and removing land from production • The use of Ministerial Zoning Orders • Rural land zoning and use • Improved access to broadband • Long term care funding • Hospital capacity and healthcare • Inationary trends • Labour shortages • Cannabis production property nuisance issuesThe guest speaker for the Roundtable was Erin Morgan, the Executive Director of the Ontario Cooperative Association (OCA). She spoke on the “cooperative business message” for the upcoming election. This provided excellent insights into ve key issues identied by the OCA, including:• Home ownership for everyone • Dignied care for everyone • Energy for everyone • Food for everyone • Co-op regulationThe OCA makes their policy material available to mutuals as members of the association through OMIA. Their willingness to continue to support local grassroots enterprise and community solutions was noted and commended by Chair, Kevin Inglis. Ontario Election Follow-Up The June election saw the return of a Progressive Conservative government with a very strong majority. Follow-up communication after the election was sent to successful candidates across the full range of parties as we continue to build awareness of the importance of mutual insurers. Municipal Elections 2022 is a municipal election year in Ontario. The Legislative Affairs Committee does not become actively involved with municipal issues, however it should be noted that many of the provincial issues identied at the spring roundtable nd their way into debates surrounding the election of municipal candidates. As these issues overlap, and as municipal ofcials consider moving onto the provincial stage, its important to maintain an active interest in municipal elections and the grassroots democratic process. Fall Roundtable Roundtable delegates met on December 21, 2022. The focus was on reviewing OMIA’s key provincial issues, including Ontario automobile insurance, Ontario building code, tort reform, and the appropriate approach to supervision on small insurers. There was also an update on expected changes to the Corporations Act in 2023. Looking Ahead We will head to Queen’s Park on March 7, 2023 to continue discussions with MPPs. Two long-time committee members, Allan Hedley and Barbara Bethune, will be leaving the committee after our 2023 AGM. We thank them for their diligent efforts over many years in keeping up our prole with MPPs of all parties.

Page 34

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT34The Market Issues Committee proactively identies and researches issues that affect how, where, and when insurance products are sold to policyholders.The committee’s discussions on issues are shared with the membership through the MarketWatch bulletin. The committee also helps OMIA plan subject matter and topics of interest for meetings, roundtables, and conferences. Perhaps the most important part of the committee’s process is to answer the question about any emerging issue, “what will this mean to my mutual?” 2022 marked the third year of pandemic related disruptions to the overall economy and the insurance marketplace. In addition to the countless issues relating to lockdowns and reopenings in the rst half of 2022, policyholders and insurers have been faced with the economic impacts of an inationary economy, supply chain breakdowns, war in Ukraine, severe weather trends, an historically active Catastrophe year, and dismal returns on investments. More twists and turns are expected before any semblance of stability or predictability returns to the market. In the meantime, here are some of the topics the Market Issues Committee focused on in 2022. Ination and Pricing Ination and its impact on insurance is an increasing threat. With decades of declining interest rates and extremely low annual movement in ination and CPI, the insurance industry has not faced the volatility that can be created by rapidly rising prices. Rising prices are now here and this shows up most dramatically in the challenges of maintaining insurance to value and ensuring premiums are adequate to meet the increased cost of claims.In the short-term this is exacerbated in the insurance industry because rising interest rates, often the contributing cause of rising ination, also have a negative effect on xed income values. As xed income is the predominant asset class held by insurers as reserves against future claims, the impact is felt quickly in the insurer investment portfolios. Simply put, as the cost of claims goes up due to ination, the assets you are holding in reserve are experiencing a sudden market value decline.Across the insurance and reinsurance industry this has created uncertainty as to the adequacy of the tools used to ensure that homes and businesses are insured adequately to value. Maintaining adequate values from an underwriting standpoint is a fundamental factor in sound long term underwriting and sufciency of premium.The need to make signicant increases on home and business valuations to maintain insurance to value runs directly into potential conict with customers who are also experiencing the impacts of ination and feeling their own budgets squeezed. Paying more for insurance typically creates a pain point for everyone involved but is a necessary part of ensuring long term stability of risk transfer. Mandate - To gather and analyze industry market information that aects Mutuals’ ability to sell their product and serve policyholders, to disseminate this information to the mutuals, and to connect with industry groups. Market Issues Committee ReportChair, Marg Torrance, Halwell Mutual2022 Committee Members Ed Forbes (Dufferin), Rob Moorehead (McKillop), Pam Marson (Grenville), Lee-Ann Vansteenkiste (Axiom), JP Gagnon (Farm Mutual Re), Sharon Turnbull (Farm Mutual Re), Susan Baker (OMIA), John Taylor (OMIA)

Page 35

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT35Given the amount of stimulus money put into the economy during the pandemic, some degree of consumer ination was inevitable. 2022 added “fuel” to that re, particularly as related to the cost of fuel. The war in the Ukraine, while creating global unrest and untold human suffering also disrupted the global energy supply with a huge spike in fuel prices. “Older” insurance professionals will remember the impact of pricing fuel costs in the 1970s due to the OPEC crisis which led to a long-term inationary environment that persisted into the 1990s. Supply Chain Disruption In some ways this is a contributing factor to ination, but from an insurance context, supply chain problems create a unique dilemma for insurers. Policyholders and insurers when making a claim on either a home, business, or auto policy are making a forced purchase. They don’t have the option of deferring the purchase and must absorb increased costs caused by supply scarcity or delay fully and immediately.These supply chain problems started early in the pandemic but the catastrophic storm claims in 2022 have added even more pressure to the cost of availability of materials. While we often think of the supply chain in the context of materials, Canada has also been experiencing a severe skills and labour shortage. This labour shortage spans the entire unskilled labour market, the trades, and the professions. This has added to pressure on claims with both material and labour under strain when they are needed the most. Brokerage Consolidation The Canadian brokerage market has seen the acceleration of consolidation of small brokers into larger entities.In some instances, these consolidations are the result of well-planned succession and the merging of relatively small brokers to form slightly larger organizations. Unfortunately, however, the two primary types of competitors for the purchase of brokerages are venture capitalists and property casualty insurers themselves. There are numerous models for broker consolidation, however the long-term impact of fewer brokerage rms providing advice and markets to policyholders can be seen as a negative impact, particularly for smaller insurers. Mutuals, both through Collectivde and independently, have also been strategic in acquiring interests in the distribution chain and have typically done so to maintain market share while also allowing broker operators to continue to operate on a scale that makes sense to them.Nonetheless, the consolidation trend continues as a signicant strategic risk that will continue to play out over the coming years. The accelerating pace of broker consolidation was particularly evident for those attending IBAO’s Annual Convention in late October 2022.Catastrophe Claims There are weather related catastrophes that impact mutuals and the insurance industry at large every year. Catastrophe claims have always been with us. The last several years have shown an increasing severity and breadth of damage arising from catastrophe claims. The May 21st derecho in Ontario created a record setting number of claims from a frequency and severity standpoint. The extent of damage was unprecedented. While derechos have been reported frequently in the United States, this experience is new to Ontario and has certainly created an increased awareness of the potential risk from a loss standpoint as well as the need for strong contingency plans for catastrophe response. 2022 also had the unprecedented impact of post tropical storm Fiona. 2022 will constitute the 3rd worse weather catastrophe event year in Canadian history, driven not by a single large loss such as the Fort McMurray wildre, but rather by a series of severe events across the country. Underlying all of this is the reality that climate change and our social and economic response to it will potentially be the biggest single global risk factor to be dealt with in the near, medium, and long-term.Looking Ahead The Market Issues Committee remains an important forum for developing responses to market trends and providing educational and discussion opportunities for member companies. The committee continues to publish Market Watch two to three times a year.With the potential for a recessionary economy in 2023, we anticipate that market forces and the impact at the policyholder level will be challenging to navigate.

Page 36

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT36This committee continues to pursue a variety of marketing projects that communicate the advantages of mutuality to internal and external audiences. We are guided by OMIA’s Strategic Priorities and the needs of the membership.Promotional Materials The OMIA Marketing department was pleased to collaborate with members on multiple individual product and advertisement projects this year and continues to be available for requests. The number of printed brochures in 2022 surpassed the amount ordered in 2019, which, we hope, signals a return to more events and in person interactions between customers and member companies. Some project examples include local advertisements, special event ads for social media, and brochure material for topics like, Cyber Suite, Cash Crop, Commercial, Farm, Hobby Farm, and special offers. We encourage you to contact to support your promotional strategy. This service is part of your membership fee, and you only pay the cost of applicable printing and shipping.Priority Exhibitions The circumstances around COVID-19 led, once again, to the cancellation of the London Farm Show and the Ottawa Valley Farm Show in March. In lieu of the London show, we submitted a small sponsorship to #Plant22, an initiative run by the Western Fair District to bring locally sourced snack boxes to the area. We will return to the tradeshow booth again at the 2023 London Farm Show, March 8-10, along with our bag sponsorship, which is a fantastic way to increase brand visibility. In 2023, after much discussion, including gathering input from our eastern Ontario mutuals, we will be trying a new approach to the Ottawa Valley Farm Show, which will take place at the Ey Centre from March 14-16. Ontario Mutuals will be a Red Ribbon Partner, and title sponsor of Hall A, which will be converted into the show’s rst ever dining hall, serving hot meals each day. This hall will also provide a backdrop for the Opening Ceremonies. We hope to make the most of this brand visibility, with the possibility of a small in person element, and look forward to sharing the results in our P&M report. We were pleased to have a booth at September’s Canada’s Outdoor Farm Show, the largest outdoor show in eastern Canada. The Ontario Mutuals booth was fully staffed by mutual participants, who greeted visitors over three busy days. The International Plowing Match (IPM), of which we are a Presenting Partner, took place in Kemptville from September 20-24. Our ever-popular yardsticks were a big hit with visitors, who also enjoyed a photobooth and a variety of musical acts on the Mutual Avenue Stage and the Ontario Mutuals Main Stage. Planning for the 2023 match is underway for September 19-23 in the Municipalities of Amaranth and Grand Valley.Broker Convention For the second year in a row, we provided sponsorship to the Young Brokers Conference, held in Niagara Falls from June 15-17. We had the opportunity to host an Ontario Mutuals tradeshow booth, which was opened up to mutual participants. An enthusiastic group from Halwell Mutual participated as our booth hosts. The IBAO’s annual Convention took place in Toronto on October 19 and 20. We had an Ontario Mutuals tradeshow booth, hosted by a full roster of mutual participants, as well as an Ontario Mutuals hospitality suite hosted by thirteen companies. This continues to be a popular exhibition and networking opportunity for the mutual community.Consumer Research In 2019, we were presented with an opportunity to become involved in a consumer research project undertaken by PMG Intelligence, a company dedicated to offering solutions to organizations in the nancial sector. The study was completed in early 2020 and delivered strategic insights that gave a deeper understanding of the consumer purchasing process, how a household connects insurance to other facets of their budget, the triggers to switching (beyond Mandate  To raise the prole of mutual insurance.Marketing Committee ReportChair, Kevin Inglis, Howick Mutual2022 Committee Members Deb Van Eyk (Lambton), Tim Wade (Westminster), Kristine Duench (Dumfries), John Taylor (OMIA), Lisa Hunter (OMIA)

Page 37

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT37price), and value proposition markers that will inform product, technology, distribution, and marketing strategies. PMG also provided a detailed illustration of three P&C insurance customer personas. As the events of the pandemic unfolded, we decided to undertake a tracking study with PMG Intelligence called a COVID Impact Analysis. This study helped us gain further insight about the impacts of COVID-19 on purchasing behaviours. PMG presented the results to members through online education sessions.PMG completed their nal research and analysis for this project in 2022 and the results will be shared with OMIA and member companies in early 2023. You can nd the 2020 and 2021 impact reports on Hover over Member Resources and nd them under Marketing. Digital Marketing Campaign OMIA Marketing launched our rst online brand awareness campaign from August to November 2020, using Google Ads, Facebook, Youtube and partner sites. It featured shortened versions of The Mutual Difference video. The campaign success led us to a 2021 project, using the same platforms and new video content.Four engaging videos were created: Investing in Community, Personal Touch, Mutuality, and Customer Service. They can be found on the Ontario Mutuals YouTube channel as well as Hover over Member Resources to see Marketing > Video Library.The key data point for an awareness campaign is the view rate, which indicates how often the video is viewed (and, if you’re familiar with Youtube, it means the viewer did not click the “skip ad” button.) A typical view rate for this type of ad is 8-10%, but the Ontario Mutuals videos on Youtube and partner sites have maintained a view rate exceeding 45% this year! We’re certainly encouraged by this and hope to continue down the digital marketing path to increase general awareness of the Ontario Mutuals brand and messaging. Filming is complete for our 2023 video series, which will centre around Chair, Steve Quinn’s theme of volunteerism in the mutual system. We’re looking forward to sharing these videos with the membership.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, supports:• 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)• AgScape• Farm and Food Care Ontario• the Ontario Soil and Crop Improvement Association• the Advancing Women in Agriculture Conference• the FarmSmart and Southwest Ag ConferencesThis year we were also able to provide small increases in support to the Rural Ontario Institute, Farm and Food Care Ontario, The Cooperative Young Leaders, and the Grow Our People Summit, a new industry conference that took place in November.Of special note, the 4-H Ontario Go for the Gold Competition was able to run in person at the Royal Agricultural Winter Fair on November 5th. This trivia-style competition is proudly sponsored by Ontario Mutuals, and OMIA’s John Taylor was able to take in the day and congratulate the winners, Wellington 4-H.Ontario Mutuals continues to fund the Umbrella Project Awards. These awards were created to recognize and celebrate students and educators who have chosen well-being and actively strengthened their resilience and positive coping skills by overcoming challenges.Many of our mutuals sponsor the Umbrella Project in their local school boards and we’re happy to be part of the grassroots growth of this valuable program. We look forward to seeing the impacts on our youth and their educators. Looking Ahead Two committee members, Jeff Holmes and Morna Foan, stepped off in 2022 as they began new roles at their mutuals. We thank them for their many contributions to the committee.We were pleased to produce a 2023 Events at a Glance booklet for you to reference as we get back to a more normal event schedule. A small supply was mailed to each company and you can also nd it by scrolling down on the home page. The marketing committee will continue to explore opportunities to promote the mutual difference through sponsorships, events, advertisements, and digital streams. We look forward to gaining new insights from online advertising endeavors, and also to returning safely to the in-person events that bring our mutual community together.

Page 38

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT38Providing member companies with the knowledge they need to inspect, sell, underwrite, and adjust the inevitable claim is 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, Janet Schmidt, Jennifer Higuchi, Kip Moi, Nicole Hackney, and Mandy Hetherington and staff from Farm Mutual Re Underwriting and Loss Control Programs, Reinsurance, and Claims departments. Member company staff provide input to the development process in a variety of ways including 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 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 points of view of these insurance professionals who look at insurance issues through a mix of underwriting, sales, and claims lenses. At the end of 2022, Megan Rooney left the Product Strategy Committee and the property/casualty insurance world to explore a new direction in nancial services. We thank her and Dumfries Mutual for the contributions she made. 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, and the development of new, coverage and supporting reference documents for member companies. This committee meets online monthly and will, post-COVID concerns, resume our goal to meet 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 Items, 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 identied as having signicant importance to their business as well as contributing to the function of 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 our policyholder owners which may require an insurance response.Mandate  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.Product Strategy Committee ReportChair, Terry Knight, North Blenheim Mutual2022 Committee Members John Miller (Mennonite Mutual – Alberta), Megan Rooney (Dumfries), Pat Ryan (The Commonwell), Neil Shay (CTM Insurance), Jamie Ellis (PEI Mutual), Annette Dumbleton (Farm Mutual Re), Christine Meacher (Farm Mutual Re), Cynthia White (Farm Mutual Re), Jennifer Higuchi (OMIA), Susan Baker (OMIA)

Page 39

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT39Forms 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 experiment with recording short audio les that will contain an explanation of some new coverage documents. Based on some member feedback that indicated a need for access to ‘just in time’ reviews of new insurance wordings, the plan is to post these sound les with the print version. We will be interested to hear our members feedback on the initial clips. Projects Since our report to the 2022 AGM, the Product Strategy Committee has overseen a variety of projects to completion. A few examples of the updates and new documents are:• Released the existing standard OMIA Residential policy • Created & released two additional Builders Risk Endorsements and updated the Builders Risk risk selection guidelines appropriately• Correction to the Agri-business machinery and equipment coverage• Developed an expanded War exclusion Endorsement and usage guidelines• Worked with Farm Mutual Re and HSB Canada to made a new Personal Cyber Coverage document available to member company policyholders and updated the existing Commercial Cyber Coverage for member company revenue generating policyholders• Conrmed that our Water Protection Endorsement is consistent with changes that a competitor made to their similar coverage• Surveyed member companies over attitude to updates to existing and development of new coverage documents and risk selection guidelines• Contributed to ongoing work towards making credit scoring an option for those member companies who wish to include it as a risk factor in their assessment process• Updated three reference documents related to the Operators Pollution Liability due to regulatory changes• Updated Alternate Energy Risk Selection Guidelines to accommodate standards where AGM batteries are in place• Rebuilding Cost Ination Factors – Personal & Commercial Lines• Created & released ‘Renewal on Varied Terms’ templates• Supported Farm Mutual Re’s update of Non-Prot D&O program and Updating of CGL rate pagesThe 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 specic 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? Our oversight role on a variety of on-going projects includes:• Updating standard Residential Insurance policy wordings based on current market scan• Conduct market scan to determine any necessary updates to the Commercial Property coverage forms including the Additional Agreements• Update the standard ‘war exclusion’ in OMIA standard wordings • Collaborate with HSB and Farm Mutual Re for updates to existing Equipment Breakdown, Household Equipment, Service Line coverage documents and risk selection guidelines• Develop a Non-Stacking of Liability Limits endorsement• Determine an appropriate coverage response for the insuring of the variety of power-assisted and motor assisted units available to member company policyholders• Support for analysis of exposures introduced due to the ‘Sharing Economy’ • Analyze current coverage documents based on recent court decisions• Identify how we currently support the Institute for Catastrophic Loss Reduction (ICLR) ‘Insurers Build Back Stronger’ and develop an endorsement to extend that promise • Update the Guaranteed Rebuilding Cost & Additional Rebuilding Cost endorsementsAs always, in response to member company needs, the Product Strategy Committee works with staff to respond to immediate market pressures as they arise.

Page 40

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT40The Regulatory Review Committee is the key mutual 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. In fact, many insurers identify the threat of regulatory intervention as an enterprise risk. The committee focuses on the regulation activity in solvency, market conduct, and governance. These requirements continue to evolve in complexity and increasingly reect international trends in nancial regulation.In 2022, FSRA continued to dene and ll out its regulatory structure and its relationship with stakeholders. This relationship is much more complex than had been the case with its predecessor the Financial Services Commission of Ontario (FSCO). Simply put, FSRA is a bigger organization with greater capacity to regulate. In 2022, there were more and better opportunities for meetings with some key FSRA working groups, particularly their Market Conduct teams and the project team on the Insurance Prudential Supervisory Framework. In addition to OMIA and the Regulatory Review Committee meeting with FSRA stakeholders, we continue to respond to ad-hoc meeting requests as related to insurance availability and other matters of interest to the regulator and various government ministries.We anticipate one of the challenges moving into the future will be dealing with a high volume of consultations on new guidelines from FSRA and the potential impact of the transition to a Principles Based supervisory regime. Ministry of Government and Consumer Services – Corporations Act The pandemic created an environment where the Corporations Act, long overdue for updating, had to be amended on a temporary basis to allow for virtual meetings. This provided an opportunity for OMIA to discuss with the Ministry of Government and Consumer Services and the Ministry of Finance important changes that could be made to allow for exibility on the number of directors required for mutual boards. Currently mutual boards must total between 6 and 15 directors and the board complement must be divisible by 3. We have asked often for the removal of this “divisible by 3” requirement. While there have been no changes yet, we are encouraged by the willingness to consider opportunities to make this change and will continue to work diligently on it. In the interim, the Ministry of Government and Consumer Services has allowed for the extension of the use of virtual meetings for a further limited time which should allow for exibility in the event of unforeseen circumstances arising from ongoing pandemic issues. We expect that the experience from the pandemic will result in more permanent changes to the Act relating to the permissibility of electronic meeting formats.Credit Union Insurance SalesThis was an important topic in late 2021 and early in 2022. The Ministry of Finance had given credit unions the power Mandate  To review regulatory issues that aect member companies.Regulatory Review Committee Report2022 Committee Members John Stirk (Dufferin), Shawn Durnin (Axiom), Jeff Whiting (Ayr), Bryan Hicks (Trillium), John Taylor (OMIA), Jackie Roy (OMIA)Chair, Marg Torrance, Halwell Mutual

Page 41

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT41to sell property and casualty insurance in credit union branches. This “sales power” is unique to credit unions as deposit taking institutions. OMIA and the Insurance Brokers Association of Ontario, as well as other stakeholders, made a series of submissions on how rules should be drafted to prohibit tied selling, ensure transparency on commission and referral fee arrangements, restrict data sharing, and make sure the insurance distributor in a credit union was a separate corporate entity from the credit union itself. We believe that these suggestions and work have resulted in better rules and consumer protection measures. To date there has not been a signicant strategic initiative by credit unions to take advantage of these new sales powers and there remains the opportunity to consider strategic alliances that may be benecial to both mutuals and credit unions as member-based nancial service organizations. Federal Privacy Regulation The Federal government continues to struggle with pulling together their proposed changes to Federal Privacy Law. A Bill read into parliament in June indicated it would break PIPEDA into three separate areas or acts:• Consumer Privacy• Articial Intelligence and Data• Personal Information and Data Protection TribunalThis will remain a difcult le for the Federal government to tie together coherently, however we are closely monitoring changes and following developments and we are hopeful any changes will be based on a graduated approach.Provincial Workplace LegislationThe Province of Ontario introduced two workplace related statutes requiring some additional policies for employers in Ontario. This included creating a Disconnect From Work Policy for all employees, as well as a policy on the Electronic Monitoring of Employees by Employers. In responding to these changes, OMIA had an opportunity to review how mutuals currently approach each of these issues, then, having conducted further legal research as to the requirements of the statute, appropriate wording policy templates were released to mutuals to assist them in complying with the new laws.Overall, we believe that these statutes have required very little in terms of practical changes at the mutual level, due to previously sound corporate policy and values, and that the templated approach has minimized the amount of work required by each mutual to become compliant. A third template policy document was created to assist with ensuring compliance with FSRA’s requirement for a Whistleblower Policy.Insurance Prudential Solvency Framework The mutuals have had a unique relationship with the provincial regulator as related to solvency oversight. This stems from the creation of the Fire Mutuals Guarantee Fund in the 1970s and the work done by the mutuals in developing tools to monitor the solvency of individual mutuals and the mutual system itself. These tools have included the development of Early Warning Tests, the standardization of, and education on, P&C1 returns and Management Discussion Analysis Reports, and stress testing. Most importantly, it stems from the creation of the Financial Review Committee and subsequently the Financial Examination Committee. From the early 2000s, these committees have carefully monitored mutual solvency and reported to the regulator on an ongoing basis to optimize policyholder safety, while at the same time ensuring a cost efcient and effective window on the solvency of each mutual for the regulator. FSRA’s published consultation on the creation of an Insurance Prudential Solvency Framework (IPSF), largely based on international standards, was put forward in early 2022. OMIA and members of the Fire Mutuals Guarantee Fund Trustee group, the Financial Review Committee, and the membership at large took part in a series of committee meetings with FSRA as they reviewed the general principles of the IPSF. Throughout the process, the mutual representatives have stressed the importance of the concept of both practicality and proportionality in any solvency oversight framework. In late June, FSRA published an Approach consultation paper setting out their vision of solvency supervision. OMIA and the Fire Mutuals Guarantee Fund made a detailed submission to FSRA expressing concerns with the potential to lose proportionality and cost efciency. Many member companies have also made individual submissions to FSRA expressing their concerns that the framework does not consider the transparency and customer focus embodied by small mutual insurers. continued on next page

Page 42

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT42While the IPSF consultation remains ongoing, the Financial Review Committee has been reviewing with FSRA their request for enhanced nancial data reporting. A pilot project is taking place in the fourth quarter of 2022. The level of engagement and effort put forward by the Financial Review Committee, the Fire Mutuals Guarantee Fund, OMIA, and member companies in providing meaningful feedback to FSRA should not be underestimated and this has been a considerable focus for mutual resources and priorities this year. To continue to understand the changing regulatory environment and the experience of other member based nancial institutions, the Regulatory Review Committee met with the Canadian Credit Union Association on September 15. Credit Unions have been working with FSRA on many similar reporting issues and experience similar challenges in adapting to some of the regulatory structures being proposed. This opportunity to work with the Canadian Credit Union Association was benecial and will continue.Fair Treatment of Consumers and Market Conduct ExaminationsAnother FSRA initiative has been to examine automobile insurers to determine the extent to which they are structured to be compliant with the Fair Treatment of Consumers Guideline, as promoted by the Canadian Council of Insurance Regulators for the past several years. OMIA’s Regulatory Review Committee and Compliance Working Group have been closely monitoring the rst of these examinations of a mutual and will continue to share the results and lessons learned with the membership in general. In 2022, as related to the Fair Treatment of Consumers, FSRA primarily focused on the sale and provision of automobile insurance as this is the form of insurance with the greatest degree of written regulation, particularly as related to pricing and selection. The centrepiece of this work has been FSRA’s thematic review of the “Take All Comers” rule.Of benet to the mutuals has been the willingness of FSRA’s Market Conduct Leadership Team to meet on a regular basis with the Regulatory Review Committee to share their priorities and planning. The OMIA Compliance Roundtable and the ERM ForumOver two years ago, the Compliance Roundtable was established to give mutuals an opportunity to discuss compliance issues and compare solutions to common problems. The Roundtable continues to meet under Chair, Bryan Hicks and is facilitated by OMIA’s Jackie Roy. In addition to the Roundtable, an informal group, known as the ERM Forum, has met virtually to discuss issues specically relating to Enterprise Risk Management.Looking Ahead FSRA, as the provincial property casualty insurance regulator, is approaching its fourth anniversary in the second quarter of 2023. In the course of the last year, FSRA has produced a signicant number of consultations and guidelines for review. For the mutuals this includes material on automobile, market conduct, and prudential supervision. The common thread throughout FSRA’s work has been moving to principles-based regulation. We anticipate that in 2023 FSRA will continue to rene and nalize more of the core components of their principles-based regulation approach and begin looking to measure industry response.

Page 43

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT43OMIA GROUPSOMIA’s voting members are constituted into ve 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 on the following pages.

Page 44

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT44Lambton Mutual hosted the Group A Annual General Meeting on November 24, 2022. The meeting was held at the Warwick Community Centre in Warwick Village. Lambton Board Chair, Clare Moffatt, welcomed directors and staff. In attendance representing Farm Mutual Re were President & CEO, JP Gagnon and Vice Chair, Kevin Konecny. Representing OMIA were President, John Taylor and Chair, Steve Quinn. Dave Clipson of PrevTech Innovations was invited as the guest speaker.Clare Moffatt chaired the meeting. After approval of the 2019 minutes, the Presidents and CEOs from each of the member companies of Group A introduced new directors and staff and provided an overview of operations as at September 30, 2022.Sue Lithgow from Lambton Mutual presented the report from the Group A Nominating Committee recommending Tracy Wintermute as the OMIA Board representative for a 3-year term beginning in March 2023. The committee also put forth Christine Van Daele as the Farm Mutual Re Board representative for a 3-year term beginning in March 2023. Both were acclaimed to their respective boards as no other candidates led their intention to stand.Steve Quinn thanked the Group A companies in attendance for their engagement with the trade association, as many great directors have come out of Group A: Rob Pearson, Christine Van Daele, and Tracy Wintermute. Steve spoke to his theme of “Our People, Our Communities, A Celebration of Success.” He shared that Cayuga Mutual’s results look very similar to many other mutuals, and although nancial results may not look like “success” right now, things will no doubt turn. John Taylor, spoke to the great work of the Accounting Advisory Committee as IFRS-17 is nally coming to fruition. He highlighted the ability of the mutuals to work together as years of data collection allowed for successful group actuarial work, leading to cost savings for all. Kevin Konecny spoke to the issue of having two independent directors on the Farm Mutual Re board, noting that there would still be 10 directors coming out of the mutual system, whether board appointed or group-elected. Kevin also spoke to the work of the various Board Committees, indicating that the Investment Committee is now a Board Committee. JP Gagnon addressed the capacity crunch that is currently happening in the reinsurance world. Catastrophe rates are estimated to be going up by as much as 30%. He encouraged the Group A companies to increase their own catastrophe retentions.Deb Van Eyk, CAMIC Director, presented slides from CAMIC highlighting their value proposition as the national voice of mutual insurers in Canada. CAMIC’s three strategic goals were briey reviewed: 1. Exploration of Other Revenue Sources2. Member Advocacy and Communication3. Sector Development and Member ServicesDeb encouraged every Group A company to participate in the 2023 Lobby Day/Mid-term meeting set for May 2, 2023 in Ottawa at Chateau Laurier. Dave Clipson, PrevTech Innovations, provided a presentation to the group on how their monitors can prevent large losses, citing that 50% or more of res are electrical in nature. Lambton Mutual is currently partnered in a pilot project with PrevTech as a way to reduce large losses, not only in agriculture, but in commercial risks as well.Clare Moffatt thanked everyone for attending the Group A meeting – a welcome change to nally meet in person again! A wine and cheese social hour was held after the meeting was adjourned. Maple Mutual will host next year’s meeting. GROUP AAxiom | Howard | Kent & Essex | Lambton | Maple | West Elgin | Westminster | Yarmouth

Page 45

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT45The Group B 2022 Annual Meeting was held on November 22, 2022 at Copetown Woods in Flamborough. There were seventy-seven in attendance.Harry Bryant (Dumfries), Chair of the Group B Executive Committee, welcomed everyone to the meeting with a Territorial Acknowledgment. The Annual Meeting Agenda was adopted by the voting delegates. Each company CEO introduced their company representatives and respective highlights for 2022.Glenn Pick (Nova) presented the Finance Report which was passed with a motion to approve from Eric Harrop (Nova) seconded by Marv Schupp (CTM).Harry Bryant put forward the nominating committee report for OMIA and Farm Mutual Re Group B Directors. The recommendation to approve Steve Quinn (OMIA) and Jill Chuli (Farm Mutual Re) for additional three-year terms were carried with motions from Tim Montague (Cayuga) and Mark Moesker (Erie) and Phil Lambert (CTM) and Jayne Carmen (Brant) respectively.Greetings and highlights on the 2022 year and 2023 outlook were received from CAMIC Past Chair, Jeff Consitt, OMIA Chair and Group B representative, Steve Quinn, OMIA President, John Taylor, Farm Mutual Re President & CEO, JP Gagnon, and Farm Mutual Re Vice Chair, Ed Forbes.Keynote speaker, Dorothy Russell-Patterson, community member and life-long volunteer at Six Nations of the Grand River Territory, graciously shared the things that unite us all: great insurance, geography, and love for this land. She then explained that our federal government is responsible for the implementation of 76 of the 94 Calls to Action from the Truth and Reconciliation Commission of Canada. She reviewed the 17 that the federal government has indicated have been completed. Three appointed watchdog groups report that eight have been completed, with nine still incomplete. Dorothy invited us all to join in Indigenous events in our area, celebrate the resilience of the Indigenous peoples on September 30 by wearing an orange shirt, hosting and/or attending lunch & learns and book studies, participating in a mapping exercise, acquiring Ally Kits from the Diocese of Huron, and/or donating to the Memorial Park at the Mohawk Institute. These are all things we can do to learn and become involved.A donation in the amount of $500 was made to Brightening the Spirit - Breaking the Silence of Suicide on behalf of Dorothy Russell-Patterson. Jim Crocker of Boardroom Metrics delivered an engaging afternoon session titled, “Hockey Canada and the Meaning of Life Governance”. He presented recent examples of corporate governance failures, followed by eight steps to great governance, with the two most critical being: understand the Board’s role and respect the governance/planning link whereby the Board identies the risks, develops the strategy, provides the annual budget, and then manages the CEO performance. In concluding the meeting, Harry Bryant thanked all attendees and presenters. Mark Moesker thanked Harry and Dumfries and, on behalf of Erie Mutual, welcomed the opportunity to host the 2023 Group B meeting.GROUP BAyr Farmers | BCM | Brant | CTM | Cayuga | Dumfries | Erie | Nova

Page 46

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT46OMIA Group C companies met at the Arden Park Hotel in Stratford, Ontario on November 18, 2022.Tradition Mutual hosted the event and the 60 attendees were welcomed by Chair, Gerald Weersink and President & CEO, Paul Burns.The Group Nominating Committee reported on the ongoing process of recruiting a Group C Director for Farm Mutual Re’s board with Paul Vandenbosch’s impending retirement from the board.Each company provided an update on their year to date including important projects. OMIA Chair, Steve Quinn shared details about his mutual (Cayuga), his theme for the year, and the tremendous support that mutuals provide as volunteers to their communities.John Taylor spoke on OMIA’s ve strategic pillars:• Solvency and Compliance • Promoting Mutuality • Data Strategy • Resource Centre • Group and Afnity ServicesFarm Mutual Re President & CEO, JP Gagnon provided an update on the reinsurance market and some of the challenges of 2022.His remarks gave insight into points to consider as mutuals look at reinsurance renewals. He also spoke about the support that Farm Mutual Re has been able to provide during a historically bad catastrophe weather claims year. Farm Mutual Re Vice Chair, Kevin Konecny provided an update on Farm Mutual Re’s board governance and the proposal to add independent directors to the Farm Mutual Re Board. This proposal is currently out to membership for consultation. Kevin also thanked Paul Vandenbosch for his leadership on the Farm Mutual Re Board. Jeff Consitt, Past Chair of CAMIC, reported on CAMIC’s strategic outlook and the positive forward momentum established in 2022, with the return to an in-person mid-term meeting and Lobby Day in Ottawa and the Annual Convention in Winnipeg. There was an opportunity for open questions and discussion which provided a great opportunity for some discussions on investment challenges and the implications of climate change. The meeting concluded with lunch.The 2023 meeting will be hosted by Usborne and Hibbert Mutual on November 24, 2023, at the Arden Park Hotel, Stratford. GROUP CMcKillop | Middlesex | North Blenheim | South Easthope | Tradition | Usborne & Hibbert | West Wawanosh

Page 47

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT47The Group D Annual Meeting took place at the OMIA and Farm Mutual Re ofces on Pinebush Road in Cambridge on November 21, 2022.There were over 50 attendees, most of whom attended in person. Video streaming was also provided for remote participants.Germania Mutual hosted the meeting. Board Chair, Gary Becker and CEO, Dan Hill welcomed the attendees. It was noted that no OMIA or Farm Mutual Re Director elections were required.Dan Hill provided an update on nancials for Group D.Individual Group D CEOs provided nancial and operational updates.OMIA Chair, Steve Quinn spoke to his theme for this year with a focus on volunteer efforts of the member companies. Steve also announced his charitable fundraiser event for the 2023 Convention.OMIA President, John Taylor focused on the ve strategic pillars for OMIA: Solvency and Compliance, Promoting Mutuals, Data Strategy, Resource Centre, and Group and Afnity Services.He noted that effective January 1, 2023, OMIA would be adding TeleHealth Services for the membership.Farm Mutual Re President & CEO, JP Gagnon focused on 2022 as the year of the “CAT”, with reference to the Derecho in May and Hurricane Fiona in September as two of the largest events in mutual history. He also provided an update on his recent meeting with our reinsurance partners. Farm Mutual Re Director, Ed Forbes focused on activities since the recent P&M meeting in late October, stressing the commitment to ESG and DEI. He also provided background on the request for feedback on the appointment of independent directors. CAMIC Director, Tracy MacDonald provided a presentation on CAMIC’s current Value Proposition, Core Values, and Goals. Tracy provided an update on Lobby Day, held in May and the AGM held in early October. She also highlighted CAMIC’s strategic plan, current board committees, and new initiatives, such as a Youth Committee and development of a members-only section of their website.A CEO panel discussion completed the agenda. Participating in the panel were Marg Torrance (Halwell), Louis Durocher (Heartland), and Dan Hill (Germania), with Kevin Inglis (Howick) acting as moderator.The CEOs were asked to give their perspectives on the following four areas:1. FSRA’s approach to regulation and how CEO’s see it impacting the future of the mutual system2. Top two or three greatest threats to current mutual business operations3. Thoughts on ination and the effects it may/will have on 2023 budgeting and operation considerations4. Our work environment heading into 2023. Do we see it changing? (Work From Home, Hybrid, or Full-time in Ofce)?GROUP DAlgoma | Dufferin | Edge | Germania | Halwell | Howick | Heartland (Associate) | Peel | TrilliumMcKillop | Middlesex | North Blenheim | South Easthope | Tradition | Usborne & Hibbert | West Wawanosh

Page 48

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT48Alan Brown, Chair, L&A Mutual, welcomed 39 participants to the 2022 Group E Annual Meeting held in person at the new head ofce of L&A Mutual in Napanee, Ontario. L&A Mutual acknowledged Harry Scanlon, Director, Bay of Quinte Mutual, for the tractor that now resides on the rooftop patio of the new building.This year, the Group E meeting format included three separate room venues within the L&A Mutual ofces. Participants were divided into three groups, which would shift in 45-minute intervals from venue to venue. Venue one was moderated by Farm Mutual Re President & CEO, JP Gagnon and General Counsel, Patrice Rouse. They discussed their theme of Path to Protability, changes to the Farm Mutual Re structure, and the impact of those changes on their team. As this was Patrice’s initial introduction to many of the participants, she provided a synopsis of her education and experience along with comments on the changes she was hired to assist with, namely the restructuring of the Farm Mutual Re Board, board and committee mandates, charters and governance, and regulatory changes.Venue two was moderated by OMIA President, John Taylor. Discussions covered topics of the continual changes in business, brokers vs. agents, Collectivide and broker acquisitions.Other discussions included the four P’s: promotion, price, product, and place.Venue three was company-led and moderated by OMIA Chair, Steve Quinn. Discussions centered around Steve’s theme for his term as board chair, “Our People, Our Communities, A Celebration of Success”.Other topics of discussion included human resources, recruitment, marketing, advertising, and community involvement.A special feature of the day was a chance to tour L&A’s recently completed new ofces. This was an innovative project to create a state of the art nancial services ofce in Napanee’s downtown core on the site of a legacy agricultural supply business. Alan Brown thanked everyone for attending and the meeting closed with a group photo on the front steps of the new L&A head ofce.GROUP EAmherst Island | Bay of Quinte | The Commonwell | Grenville | HTM | L&A

Page 49

OMIA FINANCIAL STATEMENTSThe following pages make up the Financial Statements of the Ontario Mutual Insurance Association, year ended December 31, 2022.The report was provided by Clarke, Starke & Diegel.Amherst Island | Bay of Quinte | The Commonwell | Grenville | HTM | L&A

Page 50

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT50Ontario Mutual Insurance AssociationFinancial StatementsYear ended December 31, 20227 Union Street EastWaterloo, Ontario N2J 1B5Telephone (519) 579-5520Fax (519) 570-3611www.csd.cpaINDEPENDENT AUDITOR'S REPORTTo the Directors ofOntario Mutual Insurance AssociationOpinionWe have audited the financial statements ofOntario Mutual Insurance Association (the Association),which comprise the statement of financial position as atDecember 31, 2022, and the changes ofmembers' surplus, operations and cash flows for the year then ended, and notes to the financialstatements, including a summary of significant accounting policies.In our opinion, the accompanying financial statements present fairly, in all material respects, the financialposition of the Association as atDecember 31, 2022, and the results of its operations and its cash flowsfor the year then ended in accordance with Canadian accounting standards for not-for-profitorganizations.Basis for OpinionWe conducted our audit in accordance with Canadian generally accepted auditing standards. Ourresponsibilities under those standards are further described in the Auditor's Responsibilities for the Auditof the Financial Statements section of our report. We are independent of the Association in accordancewith the ethical requirements that are relevant to our audit of the financial statements in Canada, and wehave fulfilled our other ethical responsibilities in accordance with those requirements. We believe thatthe audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.Responsibilities of Management and Those Charged with Governance for the Financial StatementsManagement is responsible for the preparation and fair presentation of the financial statements inaccordance with Canadian accounting standards for not-for-profit organizations, and for such internalcontrol as management determines is necessary to enable the preparation of financial statements thatare free from material misstatement, whether due to fraud or error.In preparing the financial statements, management is responsible for assessing the Association's abilityto continue as a going concern, disclosing, as applicable, matters relating to going concern and using thegoing concern basis of accounting unless management either intends to liquidate the Association or tocease operations, or has no realistic alternative but to do so.Those charged with governance are responsible for overseeing the Association's financial reportingprocess.ContinuesProudly serving the business community since 19721

Page 51

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT51Independent Auditor's Report to the Directors ofOntario Mutual Insurance Association (Continued)Auditor's Responsibilities for the Audit of the Financial StatementsOur objectives are to obtain reasonable assurance about whether the financial statements as a whole arefree from material misstatement, whether due to fraud or error, and to issue an auditor’s report thatincludes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that anaudit conducted in accordance with Canadian generally accepted auditing standards will always detect amaterial misstatement when it exists. Misstatements can arise from fraud or error and are consideredmaterial if, individually or in the aggregate, they could reasonably be expected to influence the economicdecisions of users taken on the basis of these financial statements. As part of an audit in accordancewith Canadian generally accepted auditing standards, we exercise professional judgment and maintainprofessional skepticism throughout the audit. We also:· Identify and assess the risks of material misstatement of the financial statements, whether due tofraud or error, design and perform audit procedures responsive to those risks, and obtain auditevidence that is sufficient and appropriate to provide a basis for our opinion. The risk of notdetecting a material misstatement resulting from fraud is higher than for one resulting from error,as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or theoverride of internal control.· Obtain an understanding of internal control relevant to the audit in order to design auditprocedures that are appropriate in the circumstances, but not for the purpose of expressing anopinion on the effectiveness of the Association’s internal control.· Evaluate the appropriateness of accounting policies used and the reasonableness of accountingestimates and related disclosures made by management.· Conclude on the appropriateness of management’s use of the going concern basis of accountingand, based on the audit evidence obtained, whether a material uncertainty exists related toevents or conditions that may cast significant doubt on the Association’s ability to continue as agoing concern. If we conclude that a material uncertainty exists, we are required to drawattention in our auditor’s report to the related disclosures in the financial statements or, if suchdisclosures are inadequate, to modify our opinion. Our conclusions are based on the auditevidence obtained up to the date of our auditor’s report. However, future events or conditionsmay cause the Association to cease to continue as a going concern.· Evaluate the overall presentation, structure and content of the financial statements, including thedisclosures, and whether the financial statements represent the underlying transactions andevents in a manner that achieves fair presentation.We communicate with those charged with governance regarding, among other matters, the plannedscope and timing of the audit and significant audit findings, including any significant deficiencies ininternal control that we identify during our audit.Waterloo, OntarioCHARTERED PROFESSIONAL ACCOUNTANTSFebruary 15, 2023LICENSED PUBLIC ACCOUNTANTS2

Page 52

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT52The accompanying notes form an integral part of these nancial statements.ONTARIO MUTUAL INSURANCE ASSOCIATIONStatement of Financial Position and Changes in Members' SurplusDecember 31, 202220222021ASSETSCURRENTCash and cash equivalents$3,448,472$3,656,128Accounts receivable - Members2,334,9203,377,672- Other50,97966,689Inventory13,75745,354Prepaid expenses309,125263,2786,157,2537,409,121CAPITAL (Note 4)136,466151,581$ 6,293,719 $ 7,560,702LIABILITIES AND MEMBERS' SURPLUSCURRENTAccounts payable$445,853$510,861Government remittances148,598148,976ASO claim reserve (Note 5)1,009,939934,454Pension contributions payable1,382,5312,486,2122,986,9214,080,503MEMBERS' SURPLUSOpening Surplus3,480,1992,893,690Current Year Surplus(173,401)586,509Year End Surplus3,306,7983,480,199$ 6,293,719 $ 7,560,702The accompanying notes form an integral part of these financial statements3

Page 53

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT53ONTARIO MUTUAL INSURANCE ASSOCIATIONStatement of OperationsDecember 31, 20222022 2021REVENUESAssociation Fees $ 1,747,574 $ 1,868,118Interest 53,547 9,963Sundry 1,862 2,248Group BenefitsEmployee Benefit Receipts $ 8,768,278 $ 8,369,401Employee Benefit Fees & Direct Expenses (12,475) (18,974)Employee Benefit Premiums (8,052,200)(7,685,508)703,603 664,919Company Benefit Receipts 3,005,021 2,390,358Company Benefit Premiums (2,918,371)(2,313,090)86,650 77,268Trusteed Pension Receipts 18,268,284 16,899,718Trusteed Pension Remittances (18,268,284)(16,899,718)- 790,253 - 742,187ConventionsRevenue 400,829 120,101Direct Expenses (306,700)94,129 (68,053) 52,048EducationRevenue 621,057 496,896Direct Expenses (154,933)466,124 (87,982) 408,914Forms & MarketingSales 157,141 139,123Cost of Sales (145,283)11,858 (120,083) 19,040StatisticsRevenue 1,976,627 2,039,968Direct Expenses (745,305)1,231,322 (689,242) 1,350,7264,396,669 4,453,244EXPENDITURESSalaries, Benefits and Pension Costs (Note 6) 3,012,035 2,783,137Promotional Activities 419,479 188,206Occupancy Costs 199,115 195,575Industry Subscriber Fees 122,498 108,038Programming & Software 116,881 81,832Office Insurance 87,747 76,103Amortization 84,626 74,468Committees 69,692 69,684Board Travel 64,742 22,981Conference Attendance 63,519 664Professional Fees 61,376 49,219Non-Recoverable G.S.T./H.S.T. 59,583 52,394Board Per Diems 54,608 49,015General Office 48,651 40,290Travel & Mileage 47,947 27,003Workshops and Training 34,171 24,443Communication Costs 23,40023,6834,570,070 3,866,735EXCESS OF REVENUES OVER EXPENDITURES $ (173,401) $ 586,509The accompanying notes form an integral part of these financial statements4The accompanying notes form an integral part of these nancial statements.

Page 54

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT54The accompanying notes form an integral part of these nancial statements.ONTARIO MUTUAL INSURANCE ASSOCIATIONStatement of Cash FlowsDecember 31, 202220222021OPERATING ACTIVITIESExcess of revenues over expenditures$(173,401)$586,509Items not effecting cash:Amortization84,62693,422(88,775)679,931Changes in non-cash working capital balances:Decrease (increase) in accounts receivable1,058,462(568,569)Decrease (increase) in inventory31,597(8,922)Decrease (increase) in prepaid expenses(45,847)(27,883)Increase (decrease) in accounts payable and government remittances(65,386)172,298Increase (decrease) in pension contributions payable(1,103,681)433,676Increase (decrease) in ASO claim reserve75,485114,455Increase (decrease) in Building Reserve Fund-(18,954)(138,145)776,032INVESTING ACTIVITYPurchase of capital assets(69,511)(146,894)NET CHANGE IN CASH AND CASH EQUIVALENTS(207,656)629,138CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR3,656,1283,026,990CASH AND CASH EQUIVALENTS, END OF YEAR $ 3,448,472 $ 3,656,128The accompanying notes form an integral part of these financial statements5Ontario Mutual Insurance AssociationNotes to Financial StatementsDecember 31, 20221. BASIS OF PRESENTATIONThe financial statements were prepared in accordance with Canadian accounting standards for not-for-profit organizations (ASNPO).2. DESCRIPTION OF OPERATIONSOntario Mutual Insurance Association is a not-for-profit trade association that provides supportservices to its membership of farm mutual insurers across Canada. The Association is incorporatedwithout share capital under the laws of the Province of Ontario. As a not-for-profit organization, theAssociation is exempt from income taxes under Section 149 of the Income Tax Act.The continued operation of the Association is dependent upon the continued support of itsmembership.3. SIGNIFICANT ACCOUNTING POLICIESRevenue recognitionThe Association follows the deferral method of accounting for its contributions.Accordingly, externally restricted contributions are recognized as revenue in the year in which the relatedexpenses are incurred. Unrestricted contributions are recognized as revenue when received orreceivable if the amount to be received can be reasonably estimated and collection is reasonablyassured.Restricted funds are deferred and recognized as revenue in the year in which the related expenses areincurred.Revenue is recognized on the accrual basis. Membership revenue is recognized in the period theservice is provided.InventoryInventory of forms and promotional material is valued at the lower of cost and net realizable value withthe cost being determined on an average cost basis.Employee future benefitsThe Association has a defined benefit plan for its employees which is accounted for using the immediaterecognition approach. Under this method, the accrued benefit obligation is based on an actuarialvaluation completed in accordance with paragraph 3463.07 at least every three years for purposes offunding the plan. The accrued benefit obligation is reported net of fair value of plan assets. Actuarialgains and losses and all costs of the plan are expensed in the year incurred.6

Page 55

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT55Ontario Mutual Insurance AssociationNotes to Financial StatementsDecember 31, 20221. BASIS OF PRESENTATIONThe financial statements were prepared in accordance with Canadian accounting standards for not-for-profit organizations (ASNPO).2. DESCRIPTION OF OPERATIONSOntario Mutual Insurance Association is a not-for-profit trade association that provides supportservices to its membership of farm mutual insurers across Canada. The Association is incorporatedwithout share capital under the laws of the Province of Ontario. As a not-for-profit organization, theAssociation is exempt from income taxes under Section 149 of the Income Tax Act.The continued operation of the Association is dependent upon the continued support of itsmembership.3. SIGNIFICANT ACCOUNTING POLICIESRevenue recognitionThe Association follows the deferral method of accounting for its contributions.Accordingly, externally restricted contributions are recognized as revenue in the year in which the relatedexpenses are incurred. Unrestricted contributions are recognized as revenue when received orreceivable if the amount to be received can be reasonably estimated and collection is reasonablyassured.Restricted funds are deferred and recognized as revenue in the year in which the related expenses areincurred.Revenue is recognized on the accrual basis. Membership revenue is recognized in the period theservice is provided.InventoryInventory of forms and promotional material is valued at the lower of cost and net realizable value withthe cost being determined on an average cost basis.Employee future benefitsThe Association has a defined benefit plan for its employees which is accounted for using the immediaterecognition approach. Under this method, the accrued benefit obligation is based on an actuarialvaluation completed in accordance with paragraph 3463.07 at least every three years for purposes offunding the plan. The accrued benefit obligation is reported net of fair value of plan assets. Actuarialgains and losses and all costs of the plan are expensed in the year incurred.6

Page 56

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT56Ontario Mutual Insurance AssociationNotes to Financial StatementsDecember 31, 20223. SIGNIFICANT ACCOUNTING POLICIES (Continued)Capital assetsCapital assets are stated at cost less accumulated amortization. Capital assets are amortized over theirestimated useful lives at the following rates and methods:Furniture and equipment 20% declining balance methodComputer equipment 33% straightline methodCash and cash equivalentsThe Association considers cash and cash equivalents to be cash deposited in financial institutions andguaranteed investment certificates which have a maturity date of less than 12 months.Financial InstrumentsFinancial instruments are recorded at fair value when acquired or issued. In subsequent periods,financial assets with actively traded markets are reported at fair value, with any unrealized gains andlosses reported in income. All other financial instruments are reported at amortized cost, and tested forimpairment at each reporting date. Transaction costs on the acquisition, sale, or issue of financialinstruments are expensed when incurred.Measurement uncertaintyCertain amounts in the financial statements are subject to measurement uncertainty and are based onthe Association's best information and judgment. Actual results could differ from these estimates.Examples of significant estimates include:· providing for amortization of capital assets;· the estimated useful lives of assets;· the allowance for doubtful accounts;· the allowance for inventory obsolescence;· certain actuarial and economic assumptions used in determining the defined benefitpension costs, accrued pension obligations and pension plan assets.4. CAPITAL20222021Cost Accumulated Net book Net bookamortization value valueFurniture and equipment468,447409,45658,99148,267Computer777,004699,52977,475103,3141,245,451 1,108,985 136,466 151,5817

Page 57

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT57Ontario Mutual Insurance AssociationNotes to Financial StatementsDecember 31, 20225. ASO CLAIM RESERVEOn January 1, 2004, the company entered into an "Administrative Service Only" self-insured agreementwith Sun Life to fund the Health and Dental Benefits of participating member company employees.These amounts represent a reserve for future benefit payments. At yearend, the following amounts arebeing held in trust for this plan:20222021Ontario Mutual Insurance Association1,009,939934,454Sunlife Assurance Company(31,018)1,868Bank of Montreal Nesbitt Burns329,318324,913Bank of Montreal196,608195,4441,504,847 1,456,679As atDecember 31, 2022,$1,009,939 is payable to the plan.6. PENSION PLAN COSTSThe Association is a member of a benefit group pension plan which it sponsors on behalf of its members. Employees hired before December 31, 2016 are members of a defined benefit pension where pension benefits are based on length of service and final average earnings. Employees hired after January 1, 2017 are enrolled in the defined contribution pension plan.An Actuarial Valuation of the plan as of December 31, 2021 revealed the plan was in a Going Concern surplus position. The Solvency Position was above the required 85% at that time, therefore no special payments were required as a result of the valuation. During 2020 the OMIA transfer ratio fell more than 10%, triggering the Financial Services Regulatory Authority (FSRA) to limit members lumpsum transfer value from the plan resulting in holdbacks. Late in 2021, the OMIA Board of Directors elected to make a funding call on members of the plan to pay the amount held back from the 2021 lumpsum transfers. That resulted in a funding call amount of $51,400 in 2021. Based on the recent valuation OMIA applied to FSRA to have the 2022 holdbacks paid out of the plan and no funding call was required in 2022. In addition, the plan was able to begin paying out members who terminate at 100%. In addition, the Association contributed an additional $238,234 to the Plan during 2022 for normal pension benefit contributions.The next valuation is scheduled to take place December 31, 2024 however the Association's Board of Directors will continue to monitor the position of the plan and may elect to call a valuation prior to that date.8

Page 58

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT58Ontario Mutual Insurance AssociationNotes to Financial StatementsDecember 31, 20227. FINANCIAL INSTRUMENTSThe Association's financial instruments consist of cash and cash equivalents, accounts receivable frommembers and others, accounts payable and accrued liabilities, ASO claim reserve and pensioncontributions payable. Unless otherwise noted, it is management's opinion that the Association is notexposed to significant currency or credit risks arising from these financial instruments.Interest rate risk is the risk that the value of a financial instrument might be adversely affected by achange in the interest rates. The Association is not exposed to any significant interest rate risk from itsfinancial instruments.The extent of the Association's exposure to the above risks did not change significantly during the year.9

Page 59

2022 ONTARIO MUTUAL INSURANCE ASSOCIATION ANNUAL REPORT59MISSIONTo Serve and Strengthen Our Mutual Insurance CommunityVISIONGrassroots Insurance at the Core of Thriving Communities

Page 60