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Intact Financial Corporation (TSX: IFC) Updated: May 25, 2018 Page 2 | Investor Presentation


  1. ��������� ������������ Intact Financial Corporation (TSX: IFC) Updated: May 25, 2018

  2. Page 2 | Investor Presentation ���������������������������� �������������������� Largest market share 10-year outperformance Distinct brands in a fragmented industry versus the industry IFC 17% Premium 3.9 pts growth 1 #2 10% #3 9% Combined 3.9 pts ratio 2 #4 6% Top 5 represent New U.S. platform 48% Return on 5.5 pts equity 3 #5 6% market share Industry data: IFC estimates based on MSA Research Inc. Please refer to Important notes on page 3 of the Q1-2018 MD&A for further information. All market share and outperformance data as at December 31, 2017. 1 Premium growth includes the impact of industry pools. 2 Combined ratio includes the market yield adjustment (MYA). 3 ROEs reflect IFRS beginning in 2010. Since 2011, IFC's ROE is adjusted return on common shareholders' equity (AROE).

  3. Page 3 | Investor Presentation ����������������������� � FY2017 performance vs. Five-year average loss ratio Canadian P&C industry outperformance gap in Canada (for the period ended Dec. 31, 2017) (for the period ended December 31, 2017) IFC Industry 5.9 pts 2.1% 4.8 pts Premium growth 1 5.0% 3.0 pts 2.9 pts 93.7% Combined ratio 2 98.6% 13.0% Return on equity 3 6.1% Personal Auto Personal Commercial Commercial Property P&C Auto Industry data: IFC estimates based on MSA Research Inc. Please refer to Important notes on page 3 of the Q1-2018 MD&A for further information. 1 Premium growth includes the impact of industry pools. 2 Combined ratio includes the market yield adjustment (MYA). 3 IFC's ROE is adjusted return on common shareholders' equity (AROE).

  4. Page 4 | Investor Presentation !����"����������������� ���#� Our $��������%� customers Our Be a ����������+�� people are our advocates customers are are our Be a destination �������� $��������%� customers actively ������� ��#� ���� ������������&����� engage with us digitally Our Specialty Our company Exceed industry ROE Achieve combined ratio in Solutions �+�-������� is one of the the ��"�,)� business is a ����� ������ in Grow NOIPS ()*�+����+� Generate '$��������� in ����� ��� �#������� annual DPW N.A.

  5. Page 5 | Investor Presentation ��� .��� ������������������� � ROE outperformance Common share NOIPS versus the industry dividend $5.60 $2.80 $3.62 $1.76 690 $2.35 $1.28 bps 2009 2013 2017 2009 2013 2018E* 602 NOIPS 8-year DPS 9-year = 11.5% = 9.1% CAGR bps CAGR * Annualized quarterly dividend declared 5-year avg. FY2017 We have regularly exceeded our 500 bps ROE $ �� ������/�����0���� outperformance target versus the industry. 56�7�����������/���8� �����1����/2��!��3���3�4���� 6%6���2��������������3� �2�1�0��� Industry data: IFC estimates based on MSA Research. Please refer to Important notes on page 3 of the Q1-2018 MD&A for further information. IFC’s ROE corresponds to the AROE.

  6. Page 6 | Investor Presentation �������������������� �� ���������"��� NOIPS growth of ()* Beat industry ROE by -������� every year per year over time ����������������������� ������� $���� $9-* ���������� ���������� �������� ���������� 6���� 69%* ������ ������������ ������� ���������������� 6���� 69%* ����������� ������������� * Leaves 6�������� to reinvest in customer experience (price, product, service, brand)

  7. Page 7 | Investor Presentation �:���������+�(69������������. 1 We expect mid-single-digit growth We expect growth at a mid-single- digit level in personal auto in personal property Claims inflation is leading to rate actions in all markets Companies are adjusting to changing weather patterns, and continued increases in the volume ceded to risk we expect the current firm market conditions to sharing pools and non-standard auto markets continue We expect mid-single-digit growth We expect growth with low single- in commercial lines in Canada digit in U.S. commercial lines These lines of business remain competitive, mainly in While the pricing environment is competitive, there are the larger risks continuing signs of upward trends in certain specialty lines • Investment yields remain low by historical standards, but there has been upward momentum on interest rates recently • The broker industry remains fragmented with continuing opportunities for consolidation Overall, we expect the P&C insurance industry’s ROE to improve but remain below its long-term average of 10% over the next 12 months 1 Refer to Section 6 – P&C Insurance Industry Outlook of the Q1-2018 MD&A

  8. Page 8 | Investor Presentation 8�����#������������"�� Multiple levers for profitable growth Near term Medium term Firming market 01 conditions Develop existing 02 platforms Consolidate 03 Canadian market Further expansion 04 outside Canada

  9. Page 9 | Investor Presentation 4�������������������;�;���� �����+� �������������� • With the addition of the OneBeacon team we have created a leading North American specialty lines insurer Creation Value focused on small to medium sized enterprises. • We expect the acquisition to deliver mid-single digit accretion to net operating income per share by the end of 2019. • Actions are in progress to grow the many profitable OneBeacon specialty lines by harnessing existing Profitable broker relationships and the momentum created by the stability of our ownership. Growth • Additional growth pipelines have been opened with commercial lines underwriting desks on each side of the border to support customers with businesses in both countries. • We have started offering OneBeacon's tailored specialty products and services in Canada, beginning with the launch of tailored products for technology and entertainment risks in late 2017. • The profitability improvement plan for OneBeacon is on track to achieve a low-90s combined ratio within 24-36 months of closing and mid-single digit accretion to NOIPS by the end of 2019. • The profitability improvement plan comprises: Improvement Profitability Underwriting : We have exited Programs and Architects & Engineers, are taking underwriting actions 1 in select other lines, and are leveraging Intact’s analytics and segmentation expertise across the portfolio. Deploy proven claims practices: We are increasing internalization of claims handling and 2 implementing further indemnity control procedures. Expense synergies : We have realized synergies of US$4M in Q1-2018. On a run-rate basis, we 3 estimate that annual synergies are approximately US$20 million at the end of the quarter, and we expect a total of US$25 million by the end of 2019.

  10. Page 10 | Investor Presentation 3��#���� ��������.���������������� Financial Accident Environmental Institutions First tailored specialty Technology Entertainment products launched in Canada Import expertise and expand product offering in Canada Cross-Border 1. Ability for both Intact and OneBeacon to service domestic clients that do business in both countries 2. Better compete with other North American insurers by offering a seamless cross-border experience Small to Mid-Size Commercial & Specialty Lines Leverage Intact underwriting and pricing expertise to broaden offering in the US and drive profitable growth

  11. Page 11 | Investor Presentation ������������ ������������ Our balance sheet is Low BVPS sensitivity to capital markets volatility 2 strong '(;(4 6$;%* <');=)> <'(;%=> <');$$> in total capital debt-to-total per 100 bps per 10% decrease per 5% decrease margin capital ratio increase in in common share in preferred share (returning to 20% in 2019) interest rates prices prices Credit ratings 1 A.M. Best DBRS Moody’s Fitch Financial strength ratings of IFC’s principal Canadian P&C A+ AA (low) A1 AA- insurance subsidiaries Senior unsecured debt ratings of IFC a- A Baa1 A- Financial strength ratings of OneBeacon U.S. regulated entities A - A2 AA- * All data as of March 31, 2018 1 Refer to Section 11.2 – Ratings of the Q1-2018 MD&A for additional commentary. 2 Refer to Section 13 – Sensitivity analyses of the Q1-2018 MD&A for additional commentary.

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