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Nominal GDP USD bn 1527.47Population mil 144.0GDP Per Capita USD 10,608Real GDP Growth % 1.5Inflation Rate % 3.7

Literacy Rate % 99.7Urbanization % 74.2Dependency Ratio % 43.5Life Expectancy Years 71.0Median Age Years 39.6

Insurance Regulator

Premiums Written (Life) USD mil 5,683Premiums Written (Non-Life) USD mil 16,215Premiums Growth (2016 - 2017) % 4.4

RussiaBelarusChinaKazakhstanPolandUkraine

CRT-2CRT-5

Country Risk TierCRT-4CRT-5CRT-3CRT-4

Vital Statistics 2017

Insurance Statistics

Regional Comparison

The Central Bank of the Russian Federation

United Nations Estimates

Source: IMF, UN, Swiss Re, Axco and A.M. Best

Regional Summary: Central Asia•Economic prospects remain vulnerable due to sanctions

against Russia, the region’s largest economy, and potential changes in trade policy. Uncertainty surrounding the sanctions, and the potential ripple effects on other countries in the region could lead to slower economic growth, given Russia’s importance for trade.

•Political power is highly concentrated. The region suffers from high levels of corruption, a lack of transparency, and regular government interference in the judicial process. A lack of political succession plans in some countries could lead to social unrest and political uncertainty.

•Statesupportofthefinancialsysteminrecentyearshas been substantial and will likely remain necessary, to strengthen buffers and facilitate lending growth, Weak banking systems in several countries will continue to lead to higher government debt.

•Additional risks for the region include tightening of global financialconditions,commoditypriceandexchangevolatility, delays in implementing structural reforms, and the potential for trade restrictions.

Economic Risk Political Risk Financial System Risk

Country Risk Tier 1 (CRT-1) Very Low Level of Country Risk

Country Risk Tier 2 (CRT-2) Low Level of Country Risk

Country Risk Tier 3 (CRT-3) Moderate Level of Country Risk

Country Risk Tier 4 (CRT-4) High Level of Country Risk

Country Risk Tier 5 (CRT-5) Very High Level of Country Risk

RussiaCRT-4August 22, 2018Region: AsiaCountry Risk Criteria ProceduresGuide to Best’s Country Risk Tiers•TheCountryRiskTier(CRT)reflectsA.M.Best’s

assessment of three categories of risk: Economic, Political, and Financial System Risk.

•Russia, a CRT-4 country, has a moderate level of economicriskandhighlevelsofpoliticalandfinancialsystem risk. Russia’s plentiful natural resources and well-educated workforce provide potential for growth. However, internationaleconomicandfinancialsystemsanctionsandheightened political tensions will constrain growth over the near term. In 2017, the Russian economy returned to growth following two years of economic recession. Growth is expected to remain moderate, but below potential, over the near term.

•The majority of countries pictured are categorized as CRT-1, 2, or 3. Notable exceptions are the Eastern European countries Belarus and Ukraine.

BEST’S COUNTRY RISK REPORT

Curacao

Cayman Islands Anguilla

BritishVirginIslands

St. Maarten

Zimbabwe

Zambia

Yemen Vietnam

Somoa

Venezuela

Vanuatu

Uzbekistan

Uruguay

United States

UnitedKingdom

U.A.E.

Ukraine

Uganda

TurkmenistanTurkey

Tunisia

Trinidad & Tobago

Tonga

Togo

Thailand

Tanzania

Tajikistan

Syria

Switzerland

Sweden

Swaziland

Suriname

Sudan

Sri Lanka

Spain

South Africa

Somalia

Solomon Islands

Slovenia

Slovakia

Singapore

SierraLeone

Serbia

Senegal

Saudi Arabia

Sao Tome & Principe

San Marino

St Vincent & the Grenadines St Lucia

St Kitts & Nevis

Rwanda

Russia

Romania

Qatar

PuertoRico

Portugal

Poland

Philippines

Peru

Paraguay

PapuaNew Guinea

Panama

Palau

Pakistan

Oman

Norway

Nigeria

NigerNicaragua

New Zealand

Netherlands

Nepal

Namibia

Mozambique

Morocco

MongoliaRepublic of

Moldova

Mexico

Mauritius

Mauritania

Malta

Mali

Malaysia

Malawi

Madagascar

Macedonia

Luxembourg

Lithuania

Liechtenstein

Libya

Liberia

Lesotho

Lebanon

Latvia

Laos

Kyrgyzstan

Kuwait

SouthKorea

NorthKorea

Kenya

Kazakhstan

Jordan

Japan

Jamaica

Italy

Israel

Ireland

Iraq Iran

India

Iceland

Hungary

Honduras

Haiti

Guyana

Guinea-Bissau Guinea

Guatemala

Grenada

Greenland

Greece

Ghana

Germany

Georgia

Gambia

Gabon

FrenchGuiana

France

Finland

Fiji

Falkland Islands

CanaryIslands

Azores

Reunion

Sumatra

Borneo

Taiwan

Sakhalin

Kuril Is

lands

NewGuinea

Tierra Del Fuego

South Georgia

Ethiopia

Estonia

Eritrea

Equatorial Guinea

El Salvador

Egypt

Ecuador

East Timor

DominicanRepublic

Dominica

Dijbouti

Denmark

CzechRepublic

Cyprus

Cuba

Croatia

Cote d'Ivoire

Costa Rica

Congo

Dem. Republicof Congo

Comoros

Colombia

China

Chile

Chad

Central AfricaRepublic

Cape Verde

Canada

Cameroon

Cambodia

Burundi

Myanmar

BurkinaFaso

Bulgaria

Brunei

Brazil

Botswana

Bosnia &Herzegovina

Bolivia

Bhutan

Benin

Belize

Belgium

Belarus

Barbados

Bangladesh

Bahrain

Bahamas

Azerbaijan

Austria

Australia

Armenia

Argentina

Antigua & Barbuda

Angola

Andorra

Algeria

Albania

Afghanistan

Western Sahara(Occupied by Morocco)

Montenegro

Isle of Man

Jersey

Guernsey

Monaco

Gibraltar

Seychelles

Russia

Hong KongMacau

Russia

Indonesia

Guam

Northern Mariana Islands

Wake Island

Marshall Islands

Federated Statesof Micronesia

Nauru

Tuvalu

CoralSeaIslands

New Caledonia

Norfolk Island

French Polynesia

Pitcairn Islands

Kiribati

Tokelau

AmericanSamoa

CookIslands

Niue

Curacao

Cayman Islands Anguilla

BritishVirginIslands

St. Maarten

Zimbabwe

Zambia

Yemen Vietnam

Somoa

Venezuela

Vanuatu

Uzbekistan

Uruguay

United States

UnitedKingdom

U.A.E.

Ukraine

Uganda

TurkmenistanTurkey

Tunisia

Trinidad & Tobago

Tonga

Togo

Thailand

Tanzania

Tajikistan

Syria

Switzerland

Sweden

Swaziland

Suriname

Sudan

Sri Lanka

Spain

South Africa

Somalia

Solomon Islands

Slovenia

Slovakia

Singapore

SierraLeone

Serbia

Senegal

Saudi Arabia

Sao Tome & Principe

San Marino

St Vincent & the Grenadines St Lucia

St Kitts & Nevis

Rwanda

Russia

Romania

Qatar

PuertoRico

Portugal

Poland

Philippines

Peru

Paraguay

PapuaNew Guinea

Panama

Palau

Pakistan

Oman

Norway

Nigeria

NigerNicaragua

New Zealand

Netherlands

Nepal

Namibia

Mozambique

Morocco

MongoliaRepublic of

Moldova

Mexico

Mauritius

Mauritania

Malta

Mali

Malaysia

Malawi

Madagascar

Macedonia

Luxembourg

Lithuania

Liechtenstein

Libya

Liberia

Lesotho

Lebanon

Latvia

Laos

Kyrgyzstan

Kuwait

SouthKorea

NorthKorea

Kenya

Kazakhstan

Jordan

Japan

Jamaica

Italy

Israel

Ireland

Iraq Iran

India

Iceland

Hungary

Honduras

Haiti

Guyana

Guinea-Bissau Guinea

Guatemala

Grenada

Greenland

Greece

Ghana

Germany

Georgia

Gambia

Gabon

FrenchGuiana

France

Finland

Fiji

Falkland Islands

CanaryIslands

Azores

Reunion

Sumatra

Borneo

Taiwan

Sakhalin

Kuril Is

lands

NewGuinea

Tierra Del Fuego

South Georgia

Ethiopia

Estonia

Eritrea

Equatorial Guinea

El Salvador

Egypt

Ecuador

East Timor

DominicanRepublic

Dominica

Dijbouti

Denmark

CzechRepublic

Cyprus

Cuba

Croatia

Cote d'Ivoire

Costa Rica

Congo

Dem. Republicof Congo

Comoros

Colombia

China

Chile

Chad

Central AfricaRepublic

Cape Verde

Canada

Cameroon

Cambodia

Burundi

Myanmar

BurkinaFaso

Bulgaria

Brunei

Brazil

Botswana

Bosnia &Herzegovina

Bolivia

Bhutan

Benin

Belize

Belgium

Belarus

Barbados

Bangladesh

Bahrain

Bahamas

Azerbaijan

Austria

Australia

Armenia

Argentina

Antigua & Barbuda

Angola

Andorra

Algeria

Albania

Afghanistan

Western Sahara(Occupied by Morocco)

Montenegro

Isle of Man

Jersey

Guernsey

Monaco

Gibraltar

Seychelles

Russia

Hong KongMacau

Russia

Indonesia

Guam

Northern Mariana Islands

Wake Island

Marshall Islands

Federated Statesof Micronesia

Nauru

Tuvalu

CoralSeaIslands

New Caledonia

Norfolk Island

French Polynesia

Pitcairn Islands

Kiribati

Tokelau

AmericanSamoa

CookIslands

Niue

Economic Risk: Moderate•Russiaisasignificantcommoditiesexporter,whichleaves

the country exposed to shifts in global demand and pricing conditions. It is one of the world’s leading producers of natural gas and oil, as well as a top exporter of metals, including steel and aluminum.

•Russia faces a wide range of structural issues, including anagingdemographic,insufficientinfrastructure,andhighlevels of state control in the economy.

•The US Treasury Department expanded sanctions against Russia in June 2018, following allegations of interference in the 2016 US presidential election. The new sanctions could increase tensions, impact the state’s involvement in the economy, and create structural limitations that will remain a drag on growth.

•Despite some worsening headwinds to growth, higher oil prices,lowerinflation,andstrongdomesticdemandwillsupport growth in the near term.

Political Risk: High•In March 2018, Vladimir Putin won a second consecutive

term as president (four presidential terms in total). Putin’s political party, the pro-Kremlin United Russia Party, has a constitutional majority in parliament. Putin’s term runs for six years through 2024.

•Decision-making lies with a narrow group of ruling elites and advisers in the presidential administration. The congressional majority will likely be able to push policy changes that the Kremlin favors. The political system will likely see further centralization of power.

•The government is highly involved in economic activity, particularly in the energy sector. Continued state intervention in the private sector has led to opaque regulationsandaninefficientandcorruptlegalsystemthatsuffers from political interference.

•CorruptioninRussiaisendemicandremainsasignificantchallenge to conducting business there. The government haslaunchedahigh-profileanti-corruptioncampaign,butthe crackdown will likely serve the ruling party’s political agenda.

•The government continues to crack down on opposition political parties, limiting their effectiveness.

Financial System Risk: High•TheCentralBankofRussiabecametheultimatefinancialregulatorforallfinancialinstitutions,includingtheinsurance industry, in 2013. Operations for the Central Bank are carried out by its Financial Markets Service.

•Duetolowerlevelsofinflationandamodestlyimprovingeconomy, the Central Bank of Russia has been able to decrease its policy interest rate.

•Several large private banks failed in 2017, underscoring the vulnerability of Russia’s banking system. The IMF has noted excessive risk concentrations as an issue.

Economic Growth (%)

-10

-5

0

5

10

15

20

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

Real GDP CPI Inflation

Source: IMF World Economic Outlook and A.M. Best

Political Risk SummaryScore 1 (best) to 5 (worst)

0

1

2

3

4

5International Transactions

Policy

Monetary Policy

Fiscal Policy

Business Environment

Labor FlexibilityGovernment Stability

Social Stability

Regional Stability

Legal System

RussiaWorld Average

Source: A.M. Best

Russia

GDP Per Capita and Population

0

200

400

600

800

1000

1200

1400

1600

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

Russia Belarus China Kazakhstan Poland Ukraine

USD

Millions

GDP Per Capita Population

Source: IMF and A.M. Best

BEST’S COUNTRY RISK REPORT

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