RAPPORT DE GESTION – InsuranceNewsNet

DE LA SITUATION FINANCIERE ET DES RESULTATS D’EXPLOITATION

The following discussion should be read in conjunction with our accompanying
consolidated financial statements and notes thereto, which appear elsewhere in
this document. In this discussion, all dollar amounts are presented in
thousands, except share and per share data.

The following discussion contains forward-looking statements. We intend
statements which are not historical in nature to be, and are hereby identified
as "forward-looking statements" to be covered by the safe harbor provisions of
the Private Securities Litigation Reform Act of 1995. In addition, the Company's
senior management may make forward-looking statements orally to analysts,
investors, the media and others. This safe harbor requires that we specify
important factors that could cause actual results to differ materially from
those contained in forward-looking statements made by or on behalf of us. We
cannot promise that our expectations in such forward-looking statements will
turn out to be correct. Our actual results could be materially different from
and worse than our expectations. See "Forward-Looking Statements" below for
specific important factors that could cause actual results to differ materially
from those contained in forward-looking statements.

                         Executive Summary and Overview

In this discussion, "Safety" refers to Safety Insurance Group, Inc. and "our
Company," "we," "us" and "our" refer to Safety Insurance Group, Inc. and its
consolidated subsidiaries. Our subsidiaries consist of Safety Insurance Company
("Safety Insurance"), Safety Indemnity Insurance Company ("Safety Indemnity"),
Safety Property and Casualty Insurance Company ("Safety P&C"), Safety Northeast
Insurance Company ("Safety Northeast"), Safety Asset Management Corporation
("SAMC"), and Safety Management Corporation, which is SAMC's holding company.

We are a leading provider of private passenger automobile, commercial
automobile, homeowners and commercial other-than-auto insurance in
Massachusetts. In addition to private passenger automobile insurance (which
represented 53.6% of our direct written premiums in 2021), we offer a portfolio
of other insurance products, including commercial automobile (16.2% of 2021
direct written premiums), homeowners (24.9% of 2021 direct written premiums) and
dwelling fire, umbrella and business owner policies (totaling 5.3% of 2021
direct written premiums).  Operating exclusively in Massachusetts, New
Hampshire, and Maine through our insurance company subsidiaries, Safety
Insurance, Safety Indemnity, Safety P&C, and Safety Northeast (together referred
to as the "Insurance Subsidiaries"), we have established strong relationships
with independent insurance agents, who numbered 856 in 1,088 locations
throughout these three states during 2021. We have used these relationships and
our extensive knowledge of the Massachusetts market to become the third largest
private passenger automobile carrier and the second largest commercial
automobile insurance carrier in Massachusetts, capturing an approximate 7.9% and
12.0% share, respectively, of the Massachusetts private passenger and commercial
automobile markets in 2021 according to statistics compiled by the CAR. We are
also the third largest homeowners insurance carrier in Massachusetts with a 6.8%
share of the Massachusetts homeowners insurance market.

AM Meilleurqui évalue les compagnies d’assurance en fonction de facteurs
assurés, cède actuellement Assurance sécurité une cote “A (Excellent)”. Notre
La note “A” a été réaffirmée par AM Meilleur sur 12 mai 2021.

Our Insurance Subsidiaries began writing insurance in New Hampshire during 2008
and in Maine in 2016. The table below shows the amount of direct written
premiums written in each state during the three months ended March 31, 2022
and
2021.

                             Three Months Ended March 31,
Direct Written Premiums       2022                       2021
Massachusetts           $        181,091               $ 184,253
New Hampshire                      7,640                   7,383
Maine                                762                     601
Total                   $        189,493               $ 192,237


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Recent Trends and Events

Beginning in March 2020, the global pandemic associated with the novel
coronavirus COVID-19 ("COVID-19") and related economic conditions caused
significant economic effects including temporary closures of many businesses and
reduced consumer activity due to shelter-in-place, stay-at-home and other
governmental actions. The Company continues to take actions that address the
health and well-being of our employees while still serving the needs of our
agents and insureds.

Pour plus d’informations, voir Partie I, Article 1A – Facteurs de risque de notre 2021
Rapport annuel sur formulaire 10-K pour l’exercice terminé 31 décembre 2021 et notre
déclaration sur les déclarations prospectives.

There are many uncertainties with respect to COVID-19. For further discussion
regarding the potential impacts of COVID-19 and related economic conditions on
the Company, see Part I, Item 1A - Risk Factors of our 2021 Annual Report on
Form 10-K for the year ended December 31, 2021. These risks include legal
challenges or legislative actions that extend business interruption coverage
outside of our policy terms for business owner policies, which require direct
physical loss or damage to property. As discussed in Note 8 - Commitments and
Contingencies, the Company has been named in a lawsuit alleging that the Company
improperly denied coverage to commercial insureds for loss of business income
resulting from the COVID-19 pandemic. Our business owner policies serve eligible
small and medium sized commercial accounts including but not limited to
apartments and condominiums; mercantile establishments; limited cooking
restaurants; offices; and special trade contractors. The majority of these
business owner policies do not contain a specific exclusion for viruses.
However, as viruses do not produce direct physical damage or loss to property,
our position is that no coverage exists for this peril. As a result, the Company
accrued a reserve of $6,500 for legal defense costs at March 31, 2022. While we
will evaluate each claim based on the specific facts and circumstances involved,
our business owner policies do not provide coverage for business interruption
claims unless there is direct physical damage or loss to property.

On April 21, 2022, the Massachusetts Supreme Judicial court ("SJC"), the state's
highest-level court, issued its decision in Verveine Corp. et al. v. Strathmore;
confirming the decision of the original trial court's dismissal of the insureds'
business interruption claims against Strathmore Insurance on the grounds that
the presence of the coronavirus on the insured premises did not constitute
"direct physical loss of or damage to" property.

The SJC noted that while the virus can be physically present on a premises, it
does not have a physical effect on property that can be characterized as loss or
damage. Rather, the phrase "direct physical loss of or damage to" property
requires a "distinct, demonstrable, physical alteration of the property," which
was not present in Verveine. The SJC specifically rejected the argument that
physical presence could amount to loss or damage. It noted that "evanescent
presence of a harmful airborne substance that will quickly dissipate on its own,
or surface-level contamination that can be removed by simply cleaning, does not
physically alter or affect property." The claim against the Company remains
open.

Losses and Loss Adjustment Expenses.  Losses and loss adjustment expenses
incurred for the three months ended March 31, 2022, loss and loss adjustment
expenses incurred increased by $11,671 or 10.5%, to $123,166 from $111,495 for
the comparable 2021 period. The increase in losses is due to a return of
pre-pandemic frequency in our private passenger automobile line of business and
current market conditions including inflation and supply chain delays.

Non-generally accepted accounting principals ("non-GAAP") operating income as
defined below was $14,809 for the three months ended March 31, 2022 compared to
$28,856 for the comparable 2021 period. The decrease in Non-GAAP operating
income was primarily the result of an increase in loss and loss adjustment
expenses compared to the prior period. Non-GAAP operating income for the quarter
ended March 31, 2022 was $0.99 per diluted share, compared to $1.93 per diluted
share, for the comparable 2021 period.

Les changements de taux suivants ont été déposés et approuvés par l’assurance
régulateurs de Massachusetts et New Hampshire en 2022. Notre Massachusetts privé
les tarifs des voitures de tourisme comprennent un taux de commission de 13 % pour les agents.

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             Line of Business                 Effective Date       Rate Change
New Hampshire Commercial Automobile           September 1, 2022       2.8%
Massachusetts Commercial Automobile           May 1, 2022             3.3%
Massachusetts Homeowner                       June 1, 2022            2.6%
Massachusetts Private Passenger Automobile    March 1, 2022           -2.3%


The Massachusetts Private Passenger Automobile rate change effective March 1,
2022 was primarily related to discounts offered to our policyholders, including
the enhancement of a low mileage discount, an enhancement of our E-Customer
discount, and the introduction of a Paid in Full discount.

Ratios d’assurance

The property and casualty insurance industry uses the combined ratio as a
measure of underwriting profitability.  The combined ratio is the sum of the
loss ratio (losses and loss adjustment expenses incurred as a percent of net
earned premiums) plus the expense ratio (underwriting and other expenses as a
percent of net earned premiums, calculated on a Generally Accepted Accounting
Principles ("GAAP") basis).  The combined ratio reflects only underwriting
results and does not include income from investments or finance and other
service income.  Underwriting profitability is subject to significant
fluctuations due to competition, catastrophic events, weather, economic and
social conditions, and other factors.

Nos ratios d’assurance conformes aux PCGR sont présentés dans le tableau suivant.

                   Three Months Ended March 31,
                      2022                2021
GAAP ratios:
Loss ratio                65.8 %              57.8 %
Expense ratio             32.9                33.7
Combined ratio            98.7 %              91.5 %


Share-Based Compensation

On April 2, 2018, the Company's Board of Directors adopted the Safety Insurance
Group, Inc. 2018 Long-Term Incentive Plan ("the 2018 Plan"), which was
subsequently approved by our shareholders at the 2018 Annual Meeting of
Shareholders. The 2018 Plan enables the grant of stock awards, performance
shares, cash based performance units, other stock based awards, stock options,
stock appreciation rights, and stock unit awards, each of which may be granted
separately of in tandem with other awards. Eligibility to participate includes
officers, directors, employees and other individuals who provide bona fide
services to the Company. The 2018 Plan supersedes the Company's 2002 Management
Omnibus Incentive Plan ("the 2002 Incentive Plan").

Le Plan 2018 a constitué un pool initial de 350 000 actions ordinaires
disponibles pour émission à nos employés et autres participants éligibles.

The maximum number of shares of common stock between both the 2018 Plan and 2002
Incentive Plan with respect to which awards may be granted is 2,850,000. No
further grants will be allowed under the 2002 Incentive Plan. At March 31, 2022,
there were 94,216 shares available for future grant.

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Table des matières

Un résumé des attributions fondées sur des actions accordées en vertu du régime d’intéressement au cours de l’exercice
trois mois terminés 31 mars 2022 est comme suit:

      Type of                                Number of          Fair
       Equity                                  Awards         Value per
      Awarded            Effective Date       Granted         Share (1)           Vesting Terms
RS - Service            February 23, 2022        31,864    $      84.98     3 years, 30%-30%-40%
RS - Performance        February 23, 2022        26,037    $      84.98     3 years, cliff vesting (3)
RS                      February 23, 2022         5,000    $      84.98     No vesting period (2)
RS                      March 24, 2022            2,000    $      89.63    

Pas de période d’acquisition (2)
RS
– Performance 23 février 2022 5 791 84,98 $ Pas de période d’acquisition (4)

(1) La juste valeur par action de l’attribution gratuite d’actions est égale à la

cours de clôture de nos actions ordinaires à la date d’attribution.

Conseil d’administration les membres doivent maintenir un actionnariat égal à au moins
(2) quatre fois leur rémunération annuelle. Cette exigence doit être satisfaite dans les cinq

    years of becoming a director.


    The shares represent performance-based restricted shares award. Vesting of

ces actions est conditionnée à l’atteinte de performances préétablies
(3) les objectifs, et la différence éventuelle entre les actions attribuées et les actions acquises à

la fin de la période de performance sera rapportée à la fin de la

période d’exécution.

Les actions représentent un ajustement des actions basées sur la performance précédemment attribuées
(4) attributions d’actions restreintes. Les parts mises à jour ont été calculées sur la base des

l’atteinte d’objectifs de performance préétablis et accordés dans le cadre du

    2018 Plan.


Reinsurance

We reinsure with other insurance companies a portion of our potential liability
under the policies we have underwritten, thereby protecting us against an
unexpectedly large loss or a catastrophic occurrence that could produce large
losses, primarily in our homeowners line of business. We are selective in
choosing our reinsurers, seeking only those companies that we consider to be
financially stable and adequately capitalized. In an effort to minimize exposure
to the insolvency of a reinsurer, we continually evaluate and review the
financial condition of our reinsurers. Most of our other reinsurers have an A.M.
Best rating of "A+" (Superior) or "A" (Excellent).

We maintain reinsurance coverage to help lessen the effect of losses from
catastrophic events, maintaining coverage during 2022 that protects us in the
event of a "136-year storm" (that is, a storm of a severity expected to occur
once in a 136-year period). We use various software products to measure our
exposure to catastrophe losses and the probable maximum loss to us for
catastrophe losses such as hurricanes. The models include estimates for our
share of the catastrophe losses generated in the residual market for property
insurance by the Massachusetts Property Insurance Underwriting Association
("FAIR Plan").

For 2022, we have purchased three layers of excess catastrophe reinsurance
providing $590,000 of coverage for property losses in excess of $75,000 up to a
maximum of $665,000. Our reinsurers' co-participation is 80.0% of $75,000 for
the 1st layer, 80.0% of $250,000 for the 2nd layer and 80.0% of $265,000 for the
3rd layer.

We also have casualty excess of loss reinsurance for large casualty losses
occurring in our automobile, homeowners, dwelling fire, business owners, and
commercial package lines of business in excess of $2,000 up to a maximum of
$10,000. We have property excess of loss reinsurance coverage for large property
losses, with coverage in excess of $2,000 up to a maximum of $20,760, for our
homeowners, business owners, and commercial package policies. In addition, we
have liability excess of loss reinsurance for umbrella large losses in excess of
$1,000 up to a maximum of $10,000. We also have various reinsurance agreements
with Hartford Steam Boiler Inspection and Insurance Company, of which the
primary contract is a quota share agreement under which we cede 100% of the
premiums and losses for the equipment breakdown coverage under our business
owner policies and commercial package policies.

We are a participant in CAR, a state-established body that runs the residual
market reinsurance programs for commercial automobile insurance in Massachusetts
under which premiums, expenses, losses and loss adjustment expenses on ceded
business are shared by all insurers writing automobile insurance in
Massachusetts. We also participate in the FAIR Plan in which premiums, expenses,
losses and loss adjustment expenses on homeowners business that cannot be placed
in the voluntary market are shared by all insurers writing homeowners insurance
in Massachusetts.

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As a response to the exposure to catastrophe losses, on July 1, 2021, the FAIR
Plan purchased $1,800,000 of catastrophe reinsurance for property losses with
retention of $100,000.

À 31 mars 2022nous avons eu 111 118 $ à recouvrer de CAR comprenant la perte
provisions pour frais de règlement, primes non acquises et réassurance à recouvrer.

Mesures non conformes aux PCGR

Management has included certain non-GAAP financial measures in presenting the
Company's results. Management believes that these non-GAAP measures better
explain the Company's results of operations and allow for a more complete
understanding of the underlying trends in the Company's business. These measures
should not be viewed as a substitute for those determined in accordance with
GAAP. In addition, our definitions of these items may not be comparable to the
definitions used by other companies.

Non-GAAP operating income and non-GAAP operating income per diluted share
consist of our GAAP net income adjusted by the net realized gains (losses) on
investments, changes in net unrealized gains on equity investments, credit loss
benefit (expense) and taxes related thereto. Net income (loss) and earnings
(loss) per diluted share are the GAAP financial measures that are most directly
comparable to non-GAAP operating income and non-GAAP operating income per
diluted share, respectively. A reconciliation of the GAAP financial measures to
these non-GAAP measures is included in the financial highlights below.

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                             Results of Operations

Trois mois terminés 31 mars 2022 par rapport aux trois mois clos 31 mars 2021

Le tableau suivant présente certains de nos résultats financiers sélectionnés.

                                                                 Three Months Ended March 31,
                                                                    2022                 2021
Direct written premiums                                       $        189,493      $      192,237
Net written premiums                                          $        178,052      $      184,218
Net earned premiums                                           $        187,088      $      192,850
Net investment income                                                   10,590              11,532
Earnings from partnership investments                                    2,832               4,291
Net realized gains on investments                                        4,210               2,875
Change in net unrealized gains on equity securities                   (13,034)               6,207
Credit loss (expense) benefit                                                -                 181
Finance and other service income                                         3,317               3,972
Total revenue                                                          195,003             221,908
Losses and loss adjustment expenses                                    123,166             111,495
Underwriting, operating and related expenses                            61,594              65,024
Interest expense                                                           129                 129
Total expenses                                                         184,889             176,648
Income before income taxes                                              10,114              45,260
Income tax expense                                                       2,276               9,086
Net income                                                    $          7,838      $       36,174
Earnings per weighted average common share:
Basic                                                         $           0.53      $         2.44
Diluted                                                       $           0.53      $         2.42
Cash dividends paid per common share                          $           

0,90 $ 0,90

Rapprochement du résultat net et du résultat d’exploitation non conforme aux PCGR :

Net income                                                    $          7,838      $       36,174
Exclusions from net income:
Net realized gains on investments                                      (4,210)             (2,875)
Change in net unrealized gains on equity securities                     13,034             (6,207)
Credit loss expense (benefit)                                                -               (181)
Income tax expense on exclusions from net income                       (1,853)               1,945
Non-GAAP Operating income                                     $         14,809      $       28,856

Net income per diluted share                                  $           0.53      $         2.42
Exclusions from net income:
Net realized gains on investments                                       (0.29)              (0.19)
Change in net unrealized gains on equity securities                       0.88              (0.42)
Credit loss expense (benefit)                                                -              (0.01)
Income tax expense on exclusions from net income                        (0.13)                0.13
Non-GAAP Operating income per diluted share                   $           

0,99 $ 1,93

Primes souscrites directes. Primes souscrites directes pour les trois mois clos
31 mars 2022 diminué de 2 744 $soit 1,4 %, à 189 493 $ depuis 192 237 $ pour le
période comparable de 2021. La diminution concerne principalement nos passagers privés
automobile et est le résultat d’une diminution du nombre de polices.

Net Written Premiums. Net written premiums for the three months ended March 31,
2022 decreased by $6,166, or 3.3%, to $178,052 from $184,218 for the comparable
2021 period. The 2022 decrease was primarily due to the factors that decreased
direct written premiums.

Net Earned Premiums.  Net earned premiums for the three months ended March 31,
2022 decreased by $5,762, or 3.0%, to $187,088 from $192,850 for the comparable
2021 period. The 2022 decrease was primarily due to the factors that decreased
direct written premiums.

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The effect of reinsurance on net written and net earned premiums is presented in
the following table.

                           Three Months Ended March 31,
                             2022                2021
Written Premiums
Direct                   $      189,493      $      192,237
Assumed                           6,741               7,331
Ceded                          (18,182)            (15,350)
Net written premiums     $      178,052      $      184,218

Earned Premiums
Direct                   $      196,519      $      201,055
Assumed                           7,754               8,027
Ceded                          (17,185)            (16,232)
Net earned premiums      $      187,088      $      192,850


Net Investment Income.  Net investment income for the three months ended
March 31, 2022 decreased by $942, or 8.2%, to $10,590 from $11,532 for the
comparable 2021 period. The decrease is a result of lower yields on our fixed
maturity assets on the investment portfolio which was 2.9% for the three months
ended March 31, 2022 compared to 3.2% for the three months ended March 31, 2021.
The investment portfolio's duration was 3.7 years at March 31, 2022 compared to
3.6 years at December 31, 2021.

Earnings from Partnership Investments. Earnings from partnership investments was
$2,832 for the three months ended March 31, 2022 compared to $4,291 for the
comparable 2021 period. Timing and generation of these returns on capital can
vary based on the results and transactions of the underlying partnerships.

Net Realized gains on Investments.  Net realized gains on investments was $4,210
for the three months ended March 31, 2022 compared to $2,875 for the comparable
2021 period. The increase is a result of an increase in realized gains on the
sale of equity securities compared to the prior year.

The gross unrealized gains and losses on investments in fixed maturity
securities, including redeemable preferred stocks that have characteristics of
fixed maturities, equity securities, including interests in mutual funds, and
other invested assets were as follows for the periods indicated:

                                                         As of March 31, 2022

                                Cost or       Allowance for          Gross Unrealized          Estimated
                               Amortized     Expected Credit                                     Fair
                                 Cost             Losses            Gains      Losses (3)        Value
U.S. Treasury securities      $     1,827    $              -    $         -   $      (71)    $     1,756
Obligations of states and
political subdivisions             89,553                   -          1,510       (1,360)         89,703
Residential
mortgage-backed securities
(1)                               229,117                   -          1,089       (9,019)        221,187
Commercial mortgage-backed
securities                        154,241                   -            597       (5,014)        149,824
Other asset-backed
securities                         74,709                   -            201       (2,091)         72,819
Corporate and other
securities                        616,145               (691)          4,877      (19,552)        600,779
Subtotal, fixed maturity
securities                      1,165,592               (691)          8,274      (37,107)      1,136,068
Short term securities                   5                   -              -             -              5
Equity securities (2)             218,636                   -         44,867       (4,804)        258,699
Other invested assets              91,460                   -              -             -         91,460
Totals                        $ 1,475,693    $          (691)    $    53,141   $  (41,911)    $ 1,486,232

(1)Residential mortgage-backed securities consists primarily of obligations of
U.S. Government agencies including collateralized mortgage obligations issued,
guaranteed and/or insured by the following issuers: Government National Mortgage
Association (GNMA), Federal Home Loan Mortgage Corporation (FHLMC), Federal
National Mortgage Association (FNMA) and the Federal Home Loan Bank (FHLB).
(2)Equity securities include common stock, preferred stock, mutual funds and
interests in mutual funds held to fund the Company's executive deferred
compensation plan.
(3)Our investment portfolio included 937 securities in an unrealized loss
position at March 31, 2022.

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The composition of our fixed income security portfolio by Moody's rating was as
follows:

                                                              As of March 31, 2022
                                                              Estimated
                                                              Fair Value     Percent
U.S. Treasury securities and obligations of U.S.
Government agencies                                        $     224,013        19.7 %
Aaa/Aa                                                           263,608        23.2
A                                                                247,554        21.8
Baa                                                              212,738        18.7
Ba                                                                58,986         5.2
B                                                                 98,900         8.7
Caa/Ca                                                             3,136         0.3
Not rated                                                         27,133         2.4
Total                                                      $   1,136,068       100.0 %


Les notations sont généralement attribuées lors de l’émission des titres et sont
sujet à révision sur la base des évaluations en cours. Notes dans le tableau
sont à la date indiquée.

As of March 31, 2022, our portfolio of fixed maturity investments was comprised
principally of investment grade corporate fixed maturity securities, U.S.
government and agency securities, and asset-backed securities. The portion of
our non-investment grade portfolio of fixed maturity investments is primarily
comprised of variable rate secured and senior bank loans and high yield bonds.

Le tableau suivant illustre les pertes brutes non réalisées incluses dans nos
portefeuille de placement et la juste valeur de ces titres, agrégée par
catégorie d’investissement. Le tableau illustre également la durée pendant laquelle ils
ont été dans une position continue de perte non réalisée au 31 mars 2022.

                                                                      As of March 31, 2022
                                       Less than 12 Months              12 Months or More                    Total
                                    Estimated       Unrealized      Estimated      Unrealized      Estimated      Unrealized
                                    Fair Value        Losses       Fair Value        Losses       Fair Value        Losses
U.S. Treasury securities           $      1,756    $         71    $         -    $          -    $     1,756    $         71
Obligations of states and
political subdivisions                   19,793           1,214            904             146         20,697           1,360
Residential mortgage-backed
securities                              164,056           8,366          6,657             653        170,713           9,019
Commercial mortgage-backed
securities                              118,414           4,304          5,339             710        123,753           5,014
Other asset-backed securities            60,662           2,091              -               -         60,662           2,091
Corporate and other securities          353,599          16,961         32,777           2,591        386,376          19,552
Subtotal, fixed maturity
securities                              718,280          33,007         45,677           4,100        763,957          37,107
Equity securities                        62,921           4,456            353             348         63,274           4,804
Total temporarily impaired
securities                         $    781,201    $     37,463    $    46,030    $      4,448    $   827,231    $     41,911

As of March 31, 2022 and December 31, 2021, the Company concluded that $691 of
unrealized losses were due to credit factors and were recorded as an allowance
for expected credit losses expense. The Company concluded that outside of the
securities that were recognized as credit impaired, the unrealized losses
recorded on the fixed maturity portfolio at March 31, 2022 and December 31, 2021
resulted from fluctuations in market interest rates and other temporary market
conditions as opposed to fundamental changes in the credit quality of the
issuers of such securities. Based upon the analysis performed, the Company's
decision to hold these securities, the Company's current level of liquidity and
our history of positive operating cash flows, management believes it is more
likely than not that it will not be required to sell any of its securities
before the anticipated recovery in the fair value to its amortized cost basis.

Une analyse qualitative spécifique a également été effectuée pour les titres figurant sur notre
Liste de surveillance“, le cas échéant. L’analyse qualitative a pris en compte des facteurs tels que la
situation financière et les perspectives à court terme de l’émetteur, si le
le débiteur est à jour de ses intérêts et de son principal contractuels
paiements, les modifications de la notation du titre par une agence de notation et la
volatilité historique de la juste valeur du titre.

Pour plus d’informations sur les évaluations à la juste valeur de notre portefeuille de placements,
se référer à la Rubrique 1-États financiers, Note 5, Placements, du présent Formulaire 10-Q.

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Finance and Other Service Income.  Finance and other service income includes
revenues from premium installment charges, which we recognize when earned, and
other miscellaneous income and fees. Finance and other service income for the
three months ended March 31, 2022 decreased by $655, or 16.5%, to $3,317 from
$3,972 for the comparable 2021 period. The decrease is primarily driven by a
change in our late fee assessment policy.

Loss and Loss Adjustment Expenses.  Loss and loss adjustment expenses incurred
for the three months ended March 31, 2022 increased by $11,671, or 10.5%, to
$123,166 from $111,495 for the comparable 2021 period. The increase in losses is
due to a return of pre-pandemic frequency in our private passenger automobile
line of business and current market conditions including inflation and supply
chain delays.

Our GAAP loss ratio for the three months ended March 31, 2022 increased to 65.8%
from 57.8% for the comparable 2021 period. Our GAAP loss ratio excluding loss
adjustment expenses for the three months ended March 31, 2022 was 55.2% compared
to 44.7% for the comparable 2021 period. Total prior year favorable development
included in the pre-tax results for the three months ended March 31, 2022 was
$12,412 compared to $12,459 for the comparable 2021 period.

Underwriting, Operating and Related Expenses.  Underwriting, operating and
related expenses for the three months ended March 31, 2022 decreased by $3,430,
or 5.3%, to $61,594 from $65,024 for the comparable 2021 period. Our GAAP
expense ratio for the three months ended March 31, 2022 decreased to 32.9% from
33.7% for the comparable 2021 period. The decrease is driven by a decrease in
contingent commission expenses offset by expense incurred related to an activist
investor.

Frais d’intérêts. Les charges d’intérêts ont été 129 $ pour les trois mois terminés
31 mars 2022 et 2021. La commission d’engagement de la facilité de crédit incluse dans les intérêts
la dépense était 19 $ pour les trois mois terminés 31 mars 2022 et 2021.

Income Tax Expense.  Our effective tax rate was 22.5% and 20.1% for the quarters
ended March 31, 2022 and 2021, respectively. The effective tax rate for the
quarter ended March 31, 2022 was higher than the statutory rate primarily due to
the effects of the change in unrealized gains on equity securities and the
impact of stock-based compensation. The effective tax rate for the quarter ended
March 31, 2021 was lower than the statutory rate primarily due to the effects of
tax-exempt investment income and the impact of stock-based compensation.

Revenu net. Résultat net pour les trois mois terminés 31 mars 2022 a été 7 838 $
par rapport à 36 174 $ pour la période comparable de 2021.

Non-GAAP Operating Income. Non-GAAP operating income as defined above was
$14,809 for the three months ended March 31, 2022 compared to $28,856 for the
comparable 2021 period. The decrease in Non-GAAP operating income was primarily
the result of an increase in loss and loss adjustment expenses compared to
the
prior period.

                        Liquidity and Capital Resources
As a holding company, Safety's assets consist primarily of the stock of our
direct and indirect subsidiaries. Our principal source of funds to meet our
obligations and pay dividends to shareholders, therefore, is dividends and other
permitted payments from our subsidiaries, principally Safety Insurance. Safety
is the borrower under our credit facility.

Safety Insurance's sources of funds primarily include premiums received,
investment income, and proceeds from sales and redemptions of investments.
Safety Insurance's principal uses of cash are the payment of claims, operating
expenses and taxes, the purchase of investments, and the payment of dividends to
Safety.

Net cash used for operating activities was $15,276 during the three months ended
March 31, 2022 compared to net cash provided by operating activities of $12,523
during the three months ended March 31, 2021. Our operations

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typically generate positive cash flows from operations as most premiums are
received in advance of the time when claim and benefit payments are required.
Net cash used for operating activities during the three months ended March 31,
2022 was the result of the timing of expense payments. Positive operating cash
flows are expected in the future to meet our liquidity requirements.

Net cash provided by investing activities was $15,124 during the three months
ended March 31, 2022 compared to net cash used for investing activities of $814
during the three months ended March 31, 2021. Fixed maturities, equity
securities, and other invested assets purchased were $84,970 for the three
months ended March 31, 2022 compared to $80,439 for the comparable prior year
period. Proceeds from maturities, redemptions, calls and sales, of securities
were $100,785 during the three months ended March 31, 2022 compared to $82,498
for the comparable prior year period.

Net cash used for financing activities was $28,220 and $13,915 during the three
months ended March 31, 2022 20211 period. The net cash used for financing
activities during the three months ended March 31, 2022 consisted of dividend
payments to shareholders.

The Insurance Subsidiaries maintain a high degree of liquidity within their
respective investment portfolios in fixed maturity and equity securities. We do
not anticipate the need to sell these securities to meet the Insurance
Subsidiaries cash requirements. We expect the Insurance Subsidiaries to generate
sufficient operating cash to meet all short-term and long-term cash
requirements. However, there can be no assurance that unforeseen business needs
or other items will not occur causing us to have to sell securities before their
values fully recover; thereby causing us to recognize additional impairment
charges in that time period.

Facilité de crédit

Pour plus d’informations sur notre facilité de crédit, veuillez vous référer à la rubrique 1 – Financière
Relevés, note 9, Dette, de ce formulaire 10-Q.

Prises de position comptables récentes

Pour plus d’informations sur les prises de position comptables récentes, veuillez vous référer à l’article
1- États financiers, Note 2, Prises de position comptables récentes, du présent
Formulaire 10-Q.

Questions réglementaires

Our Insurance Subsidiaries are subject to various regulatory restrictions that
limit the maximum amount of dividends available to be paid to their parent
without prior approval of the Commissioner of the Division of Insurance of
Massachusetts. The Massachusetts statute limits the dividends an insurer may pay
in any twelve-month period, without the prior permission of the Commissioner, to
the greater of (i) 10% of the insurer's surplus as of the preceding December 31
or (ii) the insurer's net income for the twelve-month period ending the
preceding December 31, in each case determined in accordance with statutory
accounting practices. Our insurance company subsidiaries may not declare an
"extraordinary dividend" (defined as any dividend or distribution that, together
with other distributions made within the preceding twelve months, exceeds the
limits established by Massachusetts statute) until thirty days after the
Commissioner has received notice of the intended dividend and has not objected.
As historically administered by the Commissioner, this provision requires the
Commissioner's prior approval of an extraordinary dividend. Under Massachusetts
law, an insurer may pay cash dividends only from its unassigned funds, also
known as earned surplus, and the insurer's remaining surplus must be both
reasonable in relation to its outstanding liabilities and adequate to its
financial needs. At December 31, 2021, the statutory surplus of Safety Insurance
was $826,979, and its statutory net income for 2021 was $97,169. As a result, a
maximum of $97,169 is available in 2022 for such dividends without prior
approval of the Commissioner. As a result of this Massachusetts statute, the
Insurance Subsidiaries had restricted net assets in the amount of $729,810 at
December 31, 2021. During the three months ended March 31, 2022, Safety
Insurance paid dividends to Safety of $24,096.

The maximum dividend permitted by law is not indicative of an insurer's actual
ability to pay dividends, which may be constrained by business and regulatory
considerations, such as the impact of dividends on surplus, which could

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affecter les cotes ou la position concurrentielle d’un assureur, le montant des primes qui
peuvent être souscrits et la capacité de verser des dividendes futurs.

Depuis l’introduction en bourse de ses actions ordinaires en novembre 2002la
La société a versé des dividendes trimestriels réguliers aux actionnaires de ses actions ordinaires
Stock. Les dividendes trimestriels versés en 2022 étaient les suivants :

                                                                              Total
   Declaration          Record           Payment        Dividend per     Dividends Paid
      Date               Date              Date         Common Share       and Accrued
February 15, 2022    March 5, 2022    March 15, 2022    $        0.90    $        13,246


On May 4, 2022, our Board approved and declared a quarterly cash dividend of
$0.90 per share which will be paid on June 15, 2022 to shareholders of record on
June 1, 2022. We plan to continue to declare and pay quarterly cash dividends in
2022, depending on our financial position and the regularity of our cash flows.

On February 23, 2022, the Board of Directors approved a share repurchase program
of up to $50,000 of the Company's outstanding common shares.  As of March 31,
2022, the Board of Directors has cumulatively authorized increases to the
existing share repurchase program of up to $180,000 of its outstanding common
shares.  Under the program, the Company may repurchase shares of its common
stock for cash in public or private transactions, in the open market or
otherwise.  The timing of such repurchases and actual number of shares
repurchased will depend on a variety of factors including price, market
conditions and applicable regulatory and corporate requirements.  The program
does not require us to repurchase any specific number of shares and may be
modified, suspended or terminated at any time without prior notice. As of
March 31, 2022, the Company had purchased 3,141,477 shares of common stock at a
cost of $150,000. As of December 31, 2021, the Company had purchased 2,970,573
shares of common stock at a cost of $135,397.

Under the program, Safety may repurchase shares of its common stock for cash in
public or private transactions, in the open market or otherwise, at management's
discretion. The timing of such repurchases and actual number of shares
repurchased will depend on a variety of factors including price, market
conditions and applicable regulatory and corporate requirements. The program
does not require Safety to repurchase any specific number of shares and may be
modified, suspended or terminated at any time without prior notices.

Management believes that the current level of cash flow from operations provides
us with sufficient liquidity to meet our operating needs over the next
12 months. We expect to be able to continue to meet our operating needs after
the next 12 months from internally generated funds. Since our ability to meet
our obligations in the long term (beyond such twelve-month period) is dependent
upon such factors as market changes, insurance regulatory changes and economic
conditions, no assurance can be given that the available net cash flow will be
sufficient to meet our operating needs. We expect that we would need to borrow
or issue capital stock if we needed additional funds, for example, to pay for an
acquisition or a significant expansion of our operations. There can be no
assurance that sufficient funds for any of the foregoing purposes would be
available to us at such time.

Exigences de fonds propres fondées sur les risques

The NAIC has adopted a formula and model law to implement risk-based capital
requirements for most property and casualty insurance companies, which are
designed to determine minimum capital requirements and to raise the level of
protection that statutory surplus provides for policyholder obligations. Under
Massachusetts law, insurers having less total adjusted capital than that
required by the risk-based capital calculation will be subject to varying
degrees of regulatory action, depending on the level of capital inadequacy. The
risk-based capital law provides for four levels of regulatory action. The extent
of regulatory intervention and action increases as the level of total adjusted
capital to risk-based capital falls. As of December 31, 2021, the Insurance
Subsidiaries had total capital of $826,979, which is in excess of amounts
requiring company or regulatory action at any prescribed risk-based capital
action level. Minimum statutory capital and surplus, or company action level
risk-based capital, was $200,196 at December 31, 2021.

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Arrangements hors bilan

We have no material obligations under a guarantee contract meeting the
characteristics identified in ASC 460, Guarantees.  We have no material retained
or contingent interests in assets transferred to an unconsolidated entity. We
have no material obligations, including contingent obligations, under contracts
that would be accounted for as derivative instruments. We have no obligations,
including contingent obligations, arising out of a variable interest in an
unconsolidated entity held by, and material to, us, where such entity provides
financing, liquidity, market risk or credit risk support to, or engages in
leasing, hedging or research and development services with us. We have no direct
investments in real estate and no holdings of mortgages secured by commercial
real estate. Accordingly, we have no material off-balance sheet arrangements.

                   Critical Accounting Policies and Estimates

Provisions pour sinistres et frais de règlement de sinistres

Significant periods of time can elapse between the occurrence of an insured
loss, the reporting to us of that loss and our final payment of that loss. To
recognize liabilities for unpaid losses, we establish reserves as balance sheet
liabilities. Our reserves represent estimates of amounts needed to pay reported
and estimated losses incurred but not yet reported ("IBNR") and the expenses of
investigating and paying those losses, or loss adjustment expenses. Every
quarter, we review our previously established reserves and adjust them, if
necessary.

When a claim is reported, claims personnel establish a "case reserve" for the
estimated amount of the ultimate payment. The amount of the reserve is primarily
based upon an evaluation of the type of claim involved, the circumstances
surrounding each claim and the policy provisions relating to the loss. The
estimate reflects the informed judgment of such personnel based on general
insurance reserving practices and on the experience and knowledge of the claims
person. During the loss adjustment period, these estimates are revised as deemed
necessary by our claims department based on subsequent developments and periodic
reviews of the cases. When a claim is closed with or without a payment, the
difference between the case reserve and the settlement amount creates a reserve
deficiency if the payment exceeds the case reserve or a reserve redundancy if
the payment is less than the case reserve.

In accordance with industry practice, we also maintain reserves for IBNR. IBNR
reserves are determined in accordance with commonly accepted actuarial reserving
techniques on the basis of our historical information and experience. We review
and make adjustments to incurred but not yet reported reserves quarterly. In
addition, IBNR reserves can also be expressed as the total loss reserves
required less the case reserves on reported claims.

When reviewing reserves, we analyze historical data and estimate the impact of
various loss development factors, such as our historical loss experience and
that of the industry, trends in claims frequency and severity, our mix of
business, our claims processing procedures, legislative enactments, judicial
decisions, legal developments in imposition of damages, and changes and trends
in general economic conditions, including the effects of inflation. A change in
any of these factors from the assumption implicit in our estimate can cause our
actual loss experience to be better or worse than our reserves, and the
difference can be material. There is no precise method, however, for evaluating
the impact of any specific factor on the adequacy of reserves, because the
eventual development of reserves is affected by many factors.

Lors de l’estimation de toutes nos provisions pour sinistres, nous suivons les directives prescrites par
Codification des normes comptables (“ASC”) 944, Services financiers – Assurance.

Management determines our loss and LAE reserves estimate based upon the analysis
of our actuaries. A reasonable estimate is derived by selecting a point estimate
within a range of indications as calculated by our actuaries using generally
accepted actuarial techniques. The key assumption in most actuarial analysis is
that past patterns of frequency and severity will repeat in the future, unless a
significant change in the factors described above takes place. Our key factors
and resulting assumptions are the ultimate frequency and severity of claims,
based upon the most recent ten years of claims reported to the Company, and the
data CAR reports to us to calculate our share of the residual market, as of the
date of the applicable balance sheet. For each accident year and each coverage
within a line of business our actuaries calculate the ultimate losses incurred.
Our total reserves are the difference between the ultimate losses

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Table des matières

incurred and the cumulative loss and loss adjustment payments made to date. Our
IBNR reserves are calculated as the difference between our total reserves and
the outstanding case reserves at the end of the accounting period. To determine
ultimate losses, our actuaries calculate a range of indications and select a
point estimation using such actuarial techniques as:

Indications de pertes payées : cette méthode projette des estimations de pertes ultimes basées sur

? extrapolations des tendances historiques des sinistres payés. Cette méthode a tendance à être utilisée sur

lignes de queue courtes telles que les dommages physiques à l’automobile.

Indications des pertes subies : Cette méthode projette les estimations des pertes ultimes sur la base

? sur des extrapolations des tendances historiques des sinistres encourus. Cette méthode tend à être

   used on long tail lines of business such as automobile liability and
   homeowner's liability.

Indications de Bornhuetter-Ferguson : Cette méthode projette des estimations de pertes ultimes

sur la base d’extrapolations d’une quantité attendue d’IBNR, qui est ajoutée à

? pertes subies ou payées en cours. Cette méthode a tendance à être utilisée sur de petites

secteurs d’activité immatures ou volatils, tels que notre BOP et nos lignes parapluie de

des affaires.

Indications du code des blessures corporelles : cette méthode projette les estimations des pertes ultimes

pour notre couverture des dommages corporels des véhicules de tourisme et des véhicules utilitaires

sur la base d’extrapolations du nombre historique d’accidents et de l’historique

nombre de sinistres corporels par accident. Préjudice corporel ultime projeté

? les réclamations sont ensuite séparées en réclamations attendues par type de blessure (par exemple,

lésion tissulaire vs lésion des tissus durs) sur la base de l’expérience passée. Un ultime

la gravité, ou les montants moyens des pertes payées, est estimée sur la base de l’extrapolation

tendances historiques. Les estimations des pertes ultimes projetées selon cette méthode sont les

agrégat des pertes estimées par type de blessure.

Such techniques assume that past experience, adjusted for the effects of current
developments and anticipated trends, is an appropriate basis for predicting our
ultimate losses, total reserves, and resulting IBNR reserves. It is possible
that the final outcome may fall above or below these amounts as a result of a
number of factors, including immature data, sparse data, or significant growth
in a line of business. Using these methodologies our actuaries established a
range of reasonably possible estimations for net reserves of approximately
$433,303 to $496,093 as of March 31, 2022. In general, the low and high values
of the ranges represent reasonable minimum and maximum values of the indications
based on the techniques described above. Our selected point estimate of net loss
and LAE reserves based upon the analysis of our actuaries was $469,365 as of
March 31, 2022.

The following table presents the point estimation of the recorded reserves and
the range of estimations by line of business for net loss and LAE reserves
as of
March 31, 2022.

                                        As of March 31, 2022
Line of Business                   Low       Recorded       High
Private passenger automobile    $ 170,129    $ 182,388    $ 192,576
Commercial automobile             100,842      106,463      110,892
Homeowners                         84,650       93,434       95,516
All other                          77,682       87,080       97,109
Total                           $ 433,303    $ 469,365    $ 496,093

Le tableau suivant présente nos réserves nettes totales et le cas correspondant
réserves et réserves IBNR pour chaque métier au 31 mars 2022.

                                                  As of March 31, 2022
Line of Business                           Case          IBNR         Total
Private passenger automobile             $ 226,114    $ (43,734)    $ 

182 380

CAR assumed private passenger auto               1             7            8
Commercial automobile                       67,721         7,784       

75 505

CAR assumed commercial automobile           17,318        13,640       

30 958

Homeowners                                  83,676         (529)       

83 147

FAIR Plan assumed homeowners                 3,956         6,331       

10 287

All other                                   47,137        39,943       

87 080

Réserves nettes totales pour pertes et LAE 445 923 $ 23 442 $ 469 365 $

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  Table of Contents

At March 31, 2022, our total IBNR reserves for our private passenger automobile
line of business was comprised of ($63,102) related to estimated ultimate
decreases in the case reserves, including anticipated recoveries (i.e. salvage
and subrogation), and $19,368 related to our estimation for not yet reported
losses.

Our IBNR reserves consist of our estimate of the total loss reserves required
less our case reserves.  The IBNR reserves for CAR assumed commercial automobile
business are 44.1% of our total reserves for CAR assumed commercial automobile
business as of March 31, 2022, due to the reporting delays in the information we
receive from CAR, as described further in the section on Residual Market Loss
and Loss Adjustment Expense Reserves.  Our IBNR reserves for FAIR Plan assumed
homeowners are 61.5% of our total reserves for FAIR Plan assumed homeowners at
March 31, 2022, due to similar reporting delays in the information we receive
from FAIR Plan.

The following table presents information by line of business for our total net
reserves and the corresponding retained (i.e. direct less ceded) reserves and
assumed reserves as of March 31, 2022.

                                                     As of March 31, 2022
Line of Business                              Retained      Assumed       

Rapporter

Private passenger automobile                $  182,380
CAR assumed private passenger automobile                  $       8
Net private passenger automobile                                       $ 

182 388

Commercial automobile                           75,505
CAR assumed commercial automobile                            30,958
Net commercial automobile                                                

106 463

Homeowners                                      83,147
FAIR Plan assumed homeowners                                 10,287
Net homeowners                                                            

93 434

All other                                       87,080            -       

87 080

Réserves nettes totales pour pertes et LAE 428 112 $ 41 253 $ 469 365 $

Réserves résiduelles pour pertes sur le marché et pour frais d’ajustement des pertes

We are a participant in CAR, the FAIR Plan and other various residual markets
and assume a portion of losses and LAE on business ceded by the industry
participants to the residual markets.  We estimate reserves for assumed losses
and LAE that have not yet been reported to us by the residual markets.  Our
estimations are based upon the same factors we use for our own reserves, plus
additional factors due to the nature of and the information we receive.

Residual market deficits, consists of premium ceded to the various residual
markets less losses and LAE, and is allocated among insurance companies based on
a various formulas (the "Participation Ratio") that takes into consideration a
company's voluntary market share.

Because of the lag in the various residual market estimations, and in order to
try to validate to the extent possible the information provided, we must try to
estimate the effects of the actions of our competitors in order to establish our
Participation Ratio.

Although we rely to a significant extent in setting our reserves on the
information the various residual markets provide, we are cautious in our use of
that information, because of the delays in receiving data from the various
residual markets.  As a result, we have to estimate our Participation Ratio and
these reserves are subject to significant judgments and estimates.

Analyse de sensibilité

Establishment of appropriate reserves is an inherently uncertain process. There
can be no certainty that currently established reserves based on our key
assumptions regarding frequency and severity in our lines of business, or our
assumptions regarding our share of the CAR loss will prove adequate in light of
subsequent actual experience. To the extent that reserves are inadequate and are
strengthened, the amount of such increase is treated as a charge to earnings in
the period that the deficiency is recognized. To the extent that reserves are
redundant and are released, the amount of the release is a credit to earnings in
the period the redundancy is recognized.  For the three months ended

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March 31, 2022, a 1 percentage-point change in the loss and LAE ratio would
result in a change in reserves of $1,870. Each 1 percentage-point change in the
loss and loss expense ratio would have had a $1,477 effect on net income, or
$0.10 per diluted share.

Our assumptions consider that past experience, adjusted for the effects of
current developments and anticipated trends, are an appropriate basis for
establishing our reserves. Our individual key assumptions could each have a
reasonable possible range of plus or minus 5 percentage-points for each
estimation, although there is no guarantee that our assumptions will not have
more than a 5 percentage point variation.  The following sensitivity tables
present information for each of our primary lines of business on the effect each
1 percentage-point change in each of our key assumptions on unpaid frequency and
severity could have on our retained (i.e., direct minus ceded) loss and LAE
reserves and net income for the three months ended March 31, 2022. In evaluating
the information in the table, it should be noted that a 1 percentage-point
change in a single assumption would change estimated reserves by 1
percentage-point. A 1 percentage-point change in both our key assumptions would
change estimated reserves within a range of plus or minus 2 percentage-points.

                                              -1 Percent           No           +1 Percent
                                              Change in        Change in        Change in
                                              Frequency        Frequency        Frequency
Private passenger automobile retained
loss and LAE reserves
-1 Percent Change in Severity
Estimated decrease in reserves               $    (3,648)    $      (1,824)    $          -
Estimated increase in net income                    2,882             1,441               -
No Change in Severity
Estimated (decrease) increase in reserves         (1,824)                 -

1 824

Estimated increase (decrease) in net
income                                              1,441                 -

(1 441)

+1 Percent Change in Severity
Estimated increase in reserves                          -             1,824

3 648

Estimated decrease in net income                        -           (1,441)

(2 882)

Commercial automobile retained loss and
LAE reserves
-1 Percent Change in Severity
Estimated decrease in reserves                    (1,510)             (755)               -
Estimated increase in net income                    1,193               596               -
No Change in Severity
Estimated (decrease) increase in reserves           (755)                 -             755
Estimated increase (decrease) in net
income                                                596                 -

(596)

+1 Percent Change in Severity
Estimated increase in reserves                          -               755

1 510

Estimated decrease in net income                        -             (596)

(1 193)

Homeowners retained loss and LAE reserves
-1 Percent Change in Severity
Estimated decrease in reserves                    (1,663)             (831)               -
Estimated increase in net income                    1,314               656               -
No Change in Severity
Estimated (decrease) increase in reserves           (831)                 -             831
Estimated increase (decrease) in net
income                                                656                 -

(656)

+1 Percent Change in Severity
Estimated increase in reserves                          -               831

1 663

Estimated decrease in net income                        -             (656)

(1 314)

All other retained loss and LAE reserves
-1 Percent Change in Severity
Estimated decrease in reserves                    (1,742)             (871)               -
Estimated increase in net income                    1,376               688               -
No Change in Severity
Estimated (decrease) increase in reserves           (871)                 -             871
Estimated increase (decrease) in net
income                                                688                 -

(688)

+1 Percent Change in Severity
Estimated increase in reserves                          -               871

1 742

Estimated decrease in net income                        -             (688)
        (1,376)


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  Table of Contents

Our estimated share of CAR loss and LAE reserves is based on assumptions about
our Participation Ratio, the size of CAR, and the resulting deficit (similar
assumptions apply with respect to the FAIR Plan).  Our assumptions consider that
past experience, adjusted for the effects of current developments and
anticipated trends, is an appropriate basis for establishing our CAR reserves.
Each of our assumptions could have a reasonably possible range of plus or minus
5 percentage-points for each estimation.

The following sensitivity table presents information of the effect each 1
percentage-point change in our assumptions on our share of reserves for CAR and
other residual markets could have on our assumed loss and LAE reserves and net
income for the three months ended March 31, 2022. In evaluating the information
in the table, it should be noted that a 1 percentage-point change in our
assumptions would change estimated reserves by 1 percentage-point.

                                                -1 Percent      +1 Percent
                                                Change in       Change in
                                                Estimation      Estimation

CAR supposée automobile commerciale
Augmentation (diminution) estimée des réserves (310) $ 310 $
Augmentation (diminution) estimée du bénéfice net

             245           (245)
FAIR Plan assumed homeowners
Estimated (decrease) increase in reserves             (103)             103
Estimated increase (decrease) in net income              81            (81)

Résumé du développement de la réserve

Les changements que nous avons enregistrés dans nos réserves par le passé illustrent
l’incertitude de l’estimation des réserves. Nos réserves de l’exercice précédent ont diminué de 12 412 $
et 12 459 $ au cours des trois mois terminés 31 mars 2022 et 2021, respectivement.

The following table presents a comparison of prior year development of our net
reserves for losses and LAE for the three months ended March 31, 2022 and 2021.
Each accident year represents all claims for an annual accounting period in
which loss events occurred, regardless of when the losses are actually reported,
booked or paid.  Our financial statements reflect the aggregate results of the
current and all prior accident years.

                      Three Months Ended March 31,
Accident Year           2022                2021
2012 & prior        $          (1)      $        (408)
2013                         (176)               (134)
2014                         (269)                (89)
2015                         (297)               (490)
2016                         (746)                  70
2017                         (989)             (1,732)
2018                       (2,410)             (2,637)
2019                       (2,643)             (4,353)
2020                       (3,737)             (2,686)
2021                       (1,144)                   -
All prior years     $     (12,412)      $     (12,459)

The decreases in prior years' reserves during the three months ended March 31,
2022 and 2021 resulted from re-estimations of prior year ultimate loss and LAE
liabilities. The 2022 decrease is composed of reductions of $3,580 in our
retained private passenger automobile reserves, $2,367 in our retained
commercial automobile reserves, $3,884 in our retained homeowners reserves and
$2,581 our retained other lines reserves. The 2021 decrease is primarily
composed of reductions of $3,872 in our retained private passenger automobile
reserves, $723 in our retained commercial automobile reserves, $3,492 in our
retained homeowners reserves and $2,404 in our retained other lines reserves.

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  Table of Contents

Le tableau suivant présente les informations par secteur d’activité pour l’année précédente
évolution de nos provisions nettes pour pertes 31 mars 2022.

                               Private Passenger      Commercial
Accident Year                     Automobile          Automobile     Homeowners      All Other        Total
2012 & prior                    $             (7)     $       (1)      $       7     $        -     $      (1)
2013                                          (6)             (3)              3          (170)          (176)
2014                                          (2)             (1)           (96)          (170)          (269)
2015                                          (5)            (16)            (5)          (271)          (297)
2016                                         (57)            (47)           (82)          (560)          (746)
2017                                        (307)            (87)          (128)          (467)          (989)
2018                                        (642)           (208)        (1,030)          (530)        (2,410)
2019                                        (868)           (571)        (1,213)              9        (2,643)
2020                                      (1,655)           (722)        (1,157)          (203)        (3,737)
2021                                         (31)           (711)          (183)          (219)        (1,144)
All prior years                 $         (3,580)     $   (2,367)      $ (3,884)     $  (2,581)     $ (12,412)


The improved private passenger and commercial automobile results were primarily
due to fewer IBNR claims than previously estimated and better than previously
estimated severity on our established bodily injury and property damage case
reserves. Our other than auto and homeowners line of business prior year
reserves decreased, due primarily to fewer IBNR claims than previously
estimated.

Pour plus d’informations, voir « Résultats des opérations : pertes et ajustement des pertes
Dépenses.”

Investment Impairments

The Company uses a systematic methodology to evaluate declines in fair values
below cost or amortized cost of our investments. Some of the factors considered
in assessing impairment of fixed maturities due to credit losses include the
extent to which the fair value is less than amortized cost, the financial
condition of and the near and long-term prospects of the issuer, whether the
debtor is current on its contractually obligated interest and principal
payments, changes to the rating of the security by a rating agency, the
historical volatility of the fair value of the security and whether it is more
like than not that the Company will be required to sell the investment prior to
an anticipated recovery in value. This methodology ensures that we evaluate
available evidence concerning any declines in a disciplined manner.

For fixed maturities that the Company does not intend to sell or for which it is
more likely than not that the Company would not be required to sell before an
anticipated recovery in value, the Company separates the expected credit loss
component of the impairment from the amount related to all other factors. The
expected credit loss component is recognized as an allowance for expected credit
losses. The allowance is adjusted for any additional credit losses and
subsequent recoveries, which are booked in income as either credit loss expense
or credit loss benefit, respectively. Upon recognizing a credit loss, the cost
basis is not adjusted. The impairment related to all other factors (non-credit
factors) is reported in other comprehensive income.

Pour plus d’informations, voir “Résultats d’exploitation : pertes de valeur nettes sur
investissements.”

                           Forward-Looking Statements

Les déclarations prospectives peuvent inclure un ou plusieurs des éléments suivants, parmi
autres:

? Projections de revenus, revenus, bénéfices par action, dépenses en immobilisations,

dividendes, structure du capital ou autres éléments financiers ;

? Descriptions des plans ou objectifs de gestion pour les opérations futures,

produits ou services ;

? Les prévisions des performances économiques futures, des liquidités, des besoins de financement et

le revenu;

L’impact de la COVID-19 et des conditions économiques connexes, y compris les

? évaluation de la vulnérabilité de certaines catégories d’investissements en raison de la

les perturbations économiques associées à la COVID-19 ;

? Commentaire juridique et réglementaire

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? Descriptions des hypothèses sous-jacentes ou liées à tout ce qui précède ; et

? Performance future des marchés du crédit.

Forward-looking statements can be identified by the fact that they do not relate
strictly to historical or current facts. They often include words such as
"believe," "expect," "anticipate," "intend," "plan," "estimate," "aim,"
"projects," or words of similar meaning and expressions that indicate future
events and trends, or future or conditional verbs such as "will," "would,"
"should," "could," or "may." All statements that address expectations or
projections about the future, including statements about the Company's strategy
for growth, product development, market position, expenditures and financial
results, are forward-looking statements.

Forward-looking statements are not guarantees of future performance. By their
nature, forward-looking statements are subject to risks and uncertainties. There
are a number of factors, many of which are beyond our control, that could cause
actual future conditions, events, results or trends to differ significantly
and/or materially from historical results or those projected in the
forward-looking statements. These factors include but are not limited to:

? La nature concurrentielle de notre industrie et les effets négatifs possibles de tels

concours;

? Conditions d’exploitation des entreprises et réglementations restrictives

Massachusetts;

? La possibilité de pertes dues à des réclamations résultant de conditions météorologiques extrêmes ;

? La possibilité que le commissaire puisse approuver de futurs changements de règles qui

modifier le fonctionnement du marché résiduel ;

? La possibilité que les lois et réglementations existantes en matière d’assurance

devenir encore plus restrictif à l’avenir ;

? Notre éventuel besoin et disponibilité de financement supplémentaire, et notre

dépendance vis-à-vis de relations stratégiques, entre autres ;

Les effets des nouveaux problèmes de sinistres et de couverture sur les activités de la Société sont

incertaines, et des décisions de justice ou des modifications législatives ou réglementaires qui prennent

lieu après que la Société a émis ses politiques, y compris celles prises en réponse

? à la COVID-19 (comme obliger les assureurs à couvrir les réclamations pour interruption d’activité

indépendamment des modalités ou autres conditions incluses dans les polices qui

autrement empêcher la couverture), peut entraîner une augmentation inattendue de la

nombre de sinistres et avoir une incidence défavorable importante sur les résultats de

opérations ;

? La possibilité que les litiges civils et/ou les régulateurs d’assurance de l’État

exiger des versements supplémentaires d’allègement des primes liés à la COVID-19 ;

L’impact du COVID-19 et des risques associés, y compris sur les salariés de la Société,

? agents ou d’autres partenaires clés, pourraient avoir une incidence importante sur les résultats de

opérations, situation financière et/ou liquidité ; et

D’autres risques et facteurs identifiés de temps à autre dans nos rapports déposés auprès de

? la SECONDE. Reportez-vous à la partie I, point 1A – Facteurs de risque de notre rapport annuel 2021 sur

Formulaire 10-K pour l’année terminée 31 décembre 2021.

Some other factors, such as market, operational, liquidity, interest rate,
equity and other risks, are described elsewhere in this Quarterly Report on
Form 10-Q. Factors relating to the regulation and supervision of our Company are
also described or incorporated in this report. There are other factors besides
those described or incorporated in this report that could cause actual
conditions, events or results to differ from those in the forward-looking
statements.

Les lecteurs sont avertis de ne pas se fier indûment à ces informations prospectives
déclarations, qui ne sont valables qu’à la date à laquelle elles sont faites. Nous ne faisons pas
s’engager à mettre à jour publiquement ou à réviser toute information prospective
déclarations reflétant des circonstances ou des événements survenus après la date à laquelle
des déclarations prospectives sont faites.

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