Key elements of Advance Loss of Profit insurance October 2012 Malakut Insurance Brokers CJSC License No. 4004 issued by Federal Service for Insurance Supervision
12 years of organic growth 2000 2003 2008 2012 Malakut Insurance Brokers CJSC established in Moscow, Russia Formation of SB Malakut in Kiev, Ukraine Formation of Malakut Assistance, specialist company for Third Party Motor claims administration Malakut joins International Insurance Brokers Association (now the UNiBA Partners) Formation of Malakut Constellation CJSC, specialist broker for Space and Satellite industry Formation of Malakut Insurance Brokers LLC in Dubai, UAE Formation of Malakut Corredores de Reaseguros S.A. in Panama Malakut joins UnisonBrokers Formation of Malakut Insurance Brokers (Asia) in Malaysia 2004 2007 Revenue, US$ Professional Indemnity cover bought for the first time in 2004 Formation of SP-Malakut in Almaty, Kazakhstan Formation of representative office in Hanoi, Vietnam For several consecutive years since 2005 - the best Russian broker according to Reactions market survey 0.03 0.17 1.10 2.60 5.10 9.00 12.00 15.70 15.30 15.80 16.13 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2
Malakut today Paid-up capital - RUR 50,000,000 (equivalent of US$ 1,600,000) 100% Russian owners equity - the company is owned and controlled by management 90 people in staff in head office in Moscow and above 150 overall Premium turnover in 2011 - above US$ 150,000,000 Professional Indemnity cover for the limit of EUR 10,000,000 in force Member of: UnisonBrokers, one of the largest independent networks of mid-sized insurance brokers 1 UNiBA Partners, one of the world s largest independent providers of risk management, insurance broking and employee benefits services 2 EOS RISQ, an international partership of market-leading, privately owned brokers 3 ICBA (International Credit Brokers Alliance), the world s largest team of independently-owned, specialist trade credit insurance brokerages 4 1) Source: www.unisonbrokers.com 2) Source: www.uniba-partners.com 3) Source: www.eosrisq.com 4) Source: www.icba-online.com 3
Our offices year of foundation Moscow Kiev Almaty Hanoi Dubai Panama 2000 2001 2005 2006 2009 2010 Kuala Lumpur 2012 4
Our business Combination of traditional and specialty lines - reliable business mix Revenue per class of business 20% Responsive, dedicated teams with market knowledge and language capabilities 52% 6% 12% 5% 5% Aviation Property & Engineering Marine Energy Life & Health Miscellaneous Access to specialist underwriting Strong working relationships with reinsurance markets Revenue per type of business 20% Market intelligence Direct Insurance Growth of international business 38% 42% Facultative Reinsurance Treaty Reinsurance 5
Our projects in Turkmenistan SIOT and Malakut Insurance Brokers strategic partnership since 2008 Around 70 risks placed & more than US$ 12 mln. Reinsurance Premium turnover Remarkable for Turkmenistan projects in Energy and Civil Construction Malakut is the only independent Russian insurance broker authorized by local authorities to place reinsurance for State Insurance Organization of Turkmenistan Insured Petrofac Caspian Energy Projects Dragon Oil / ILK INSAAT Dragon Oil / ILK INSAAT HYDROMASHSERVIS GAP İnsaat ITERA Momentum Engineering Name of the Project South Yoloten Gas Field project Phase II Offshore Platform construction Zhdanov-A (Cheleken area, Caspian Sea Shelf) Off-shore Construction of the Wellhead Platform LAM C (Caspian Sea Shelf) Off-shore Construction of the Wellhead Platform Zhdanov-B (Caspian Sea Shelf) Installation of new on-shore pipeline Cenntral Kara-Kum Yelanly Tank erection at the offshore gas terminal in Kiyanly (Professional liability) Construction of hippodrome and hotel in the cities of Turkmenobat and Balkanobat Installation of new 30" Trunk line, 20" and 18" off-shore pipelines 6
Key Elements of CAR/EAR insurance Contractors All Risk / Erection All Risk insurance/ Comprehensive project insurance Section 1 Material Damage to Contract Works Section 2 Third Party Liability Section 3 Advance Loss of Profit Section 4 Project Cargo Insurance Cover for Insured Contract Works Taken Over or Put into Service Life & Health Insurance Surrounding/Existing Property buildings and structures, objects of the existing infrastructure being held in care, custody or control of the Contractor Property in Off-Site storage and Cover for Inland Transit Cover for Designer's and Manufacturer's risks Cover of Extra Charges for Overtime, Night Work, Work on Public Holidays, Express Freight Cover for Debris Removal Cost Cover for Professional Fee 7
ALoP / DSU scope of Cover The Insurer will indemnify the Principal in respect of the actual loss sustained from deferred receipt or partial receipt of revenues as a result of the Delay in completion of the permanent works beyond the scheduled commencement date of the business Actual loss sustained shall mean: Fixed Costs Fixed costs that would have been paid or payable out of the revenues that would have been received or receivable had the delay not occurred Debt Service The interest, scheduled principal payments, commitment fees, agency fees, etc. in respect of advances made or monies borrowed that would have been payable out of the revenues that would have been received had the delay not occurred Net Profit Net profit that would have been earnable from the revenues that would have been received had the delay not occurred less any sum saved in respect of such of the foregoing amounts as may cease or be reduced in consequence of the delay Increased Cost of Working Additional expenditures necessarily and reasonably incurred by the Principal or on his behalf for the sole purpose of avoiding or diminishing the amount for which the insurer would have been liable without such expenditures, but not exceeding the amount of loss thereby avoided 8
ALoP / DSU scope of Cover Period of CAR / EAR insurance Production Construction & equipment installation Test Maintenance (12-24 months) Scheduled Business Commencement Date Period of ALoP / DSU insurance Maximum period of indemnity (6-12 months) 9
ALoP / DSU scope of Cover Gross profit $ / day Scheduled Business Commencement Date Actual Business Commencement Date Inception date of cover End of Indemnity Period Loss Event Delay Operation Scheduled construction period Scheduled CAR/EAR insurance period Actual construction period Extended CAR/EAR insurance period Indemnity period time 10
ALoP / DSU scope of Cover Event 2 Supplier Transportation of CARGO Off-Site storage Event 4 Event 3 Construction Site Third Party enterprise «Y» Phase I Office block Existing Property Phase II Production unit Existing Property Third Party enterprise «Х» Event 1 11
Risk Management and Consultancy Malakut Insurance Brokers provide consultancy for all range of matters in relation to risk management Our major focus is on risks which require insurance cover We think outside the box to provide our clients with prompt executive decisions and viable solutions We effectively bring our ideas and solutions into life We support our clients 24/7/365 12
Thank you for attention! 2012