7.3 Measure of profit of a segment

The key measure of profit of a segment in PZU Group:

• with respect to corporate insurance, retail customer insurance, group and individually continued insurance, and individual insurance segments – a profit or loss on insurance constituting the profit or loss before tax and other operating income and expenses (including borrowing costs), however taking into account the income on investments (corresponding to the value of technical provisions) determined by the risk free rate. A profit or loss on insurance is a similar measure to the technical result defined in PAS, however, it includes the difference in the manner of recognizing the net result on investments as described in the previous sentence;
• with respect to investments segment – a profit or loss on investment of PZU Group entities less a profit or loss allocated to insurance segments;
• with respect to investment contract – an operating profit or loss calculated in the manner similar to the technical result, in accordance with PAS;
• in the case of banking activity or foreign insurance activity – operating profit or loss in accordance with local accounting principles in the country where the company is headquartered or the IFRS before the tax.