a.s.r. has identified three pivotal trends shaping the industry in the current political and financial market landscape:

• Geo-political uncertainty is rising due to conflicts in Ukraine and the Middle East, and recent election results affect international trade and stability.

• Economic pressure from wage increases, inflation, rising housing and energy prices, and increasing labour shortages is significant.

• Ongoing legislative changes, such as the Future Pensions Act (Wet toekomst pensioenen - WTP), sustainability requirements and other regulatory and reporting requirements are impacting insurers and other stakeholders.

Impact on a.s.r. and its stakeholders

Several geo-political tensions are leading to conflicts between countries through sanctions, protectionist measures, wars, and terrorist attacks, which impact and disrupt global supply chains and markets. Additionally, the Dutch Central Bank (De Nederlandsche Bank - DNB¹) has raised concerns about the growing presence of cyber threats to the financial sector due to these geo-political tensions, potentially leading to data breaches, financial losses and damage to a.s.r.'s reputation. In 2024, these global dynamics continued to evolve. Inflationary pressures have been moderate, but the economic landscape remains uncertain. Interest rates have further adjusted in response to global economic conditions, and fears of recession persist. For customers, this leads to uncertainties about security, availability of resources, and purchasing power, but also might raise concerns about the stability and profitability of a.s.r.

The legal and regulatory landscape in which a.s.r. operates is continuously evolving with enhanced regulatory reporting requirements. Depending on the impact of legislation and regulations, the supervisory climate and the juridification of society, a.s.r. may experience effects such as increased internal costs. In the short term, the Dutch pension landscape is reforming as a result of the WTP. Changes in the regulatory and supervisory environment could lead to stricter oversight and more frequent investigations, whilst many new regulations need to be interpreted and implemented within a short period of time, while not all regulations are final yet. These developments make it more challenging for smaller market players in the insurance sector and intermediaries to ensure alignment, possibly leading to increased market consolidation, which may offer opportunities for a.s.r. to further grow its business.

a.s.r.'s response

To asses geo-political developments, a.s.r. explores various potential economic scenarios, including stagflation, using its inhouse expertise. a.s.r. is actively exploring opportunities to further diversify its investment portfolio, such as by increasing geographical diversification in its equity and credit portfolios. Based on the level and duration of inflation and its impact on a.s.r., premium increases may be implemented. However, a.s.r. aims for a fair balance between premium increases and affordability.

a.s.r. monitors and assesses relevant developments for relevant legislative and regulatory developments and implements appropriate control measures. On key themes, programmes and/or projects are set up to ensure sound implementation, such as the implementation of sustainability (e.g. CSRD) legislation and regulations and implementation of DORA. Depending on the consequences of legislation and regulations, supervisory climate and juridification of society, and thus the impact on a.s.r. through factors such as higher internal costs, premium increases or exclusions may be implemented to offset these consequences. This will help a.s.r. to create long-term value for its main stakeholders.

• ¹Source: DNB (2024)