JPRF-M-2025-0147 — Incorporates Chapter III Mandatory Investment Norm for Companies Financing Prepaid Comprehensive Health Care Services

| Postal Code: 170507 | Quito - Ecuador |
THE FINANCIAL POLICY AND REGULATION BOARD
CONSIDERING:
That, Article 82 of the Constitution of the Republic of Ecuador prescribes that the right to legal certainty is based on respect for the Constitution and the existence of prior, clear, public legal norms applied by competent authorities; That, Article 226 of the Fundamental Norm stipulates that State institutions, their agencies, dependencies, public servants, and persons acting by virtue of a State power shall exercise only the competencies and faculties attributed to them in the Constitution and the law; having the duty to coordinate actions for the fulfillment of their purposes and to make effective the enjoyment and exercise of rights recognized in the Constitution; That, Article 227 of the Magna Carta establishes that public administration constitutes a service to the community that is governed by the principles of effectiveness, efficiency, quality, hierarchy, decentralization, coordination, participation, planning, transparency, and evaluation; That, Article 13 of the Organic Monetary and Financial Code, Book I, reformed from the promulgation of the Organic Reforming Law to the Organic Monetary and Financial Code for the Defense of Dollarization, created the Financial Policy and Regulation Board, part of the Executive Function, as a public law legal entity, with administrative, financial, and operational autonomy, responsible for the formulation of credit, financial, securities, insurance, and prepaid comprehensive health care services policy and regulation; That, Article 14 ibidem, Book I, in numbers 1, 2, and 3, determines that, within the scope of the Financial Policy and Regulation Board, it corresponds to formulate the policy for prepaid comprehensive health care services; as well as, issue regulations that allow maintaining the comprehensiveness, solidity, sustainability, and stability of prepaid comprehensive health care services; and, issue micro-prudential regulations for prepaid comprehensive health care services, based on proposals presented by the respective superintendencies, within their respective scopes of competence and without prejudice to their independence; establishing that, for the fulfillment of these functions, the referred Board will issue norms in matters proper to its competence, without being able to alter legal provisions; being able to issue regulations by segments, economic activities, and other criteria; That, the Organic Monetary and Financial Code, Book I, in its article 14.1, prescribes that, for the performance of its functions, the Financial Policy and Regulation Board must comply with certain duties and exercise certain faculties; among which are those indicated in its numbers 1, 7, and 27, which are: regulate the creation, constitution, organization, activities, operation, and liquidation of prepaid comprehensive health care service entities; issue the prudential regulatory framework to which companies financing prepaid comprehensive health care services must be subject, framework that must be
coherent and not give rise to regulatory arbitrage; and, exercise the other functions, duties, and faculties assigned to it by the cited Code and the law; That, Article 1 of the Organic Law that Regulates Companies that Finance Prepaid Comprehensive Health Care Services and Insurance Companies that Offer Medical Assistance Insurance Coverage, states that the purpose of said law is to regulate the constitution and operation of companies that finance prepaid comprehensive health care services; to regulate, supervise, and control the provision of said services to guarantee the full exercise of users' rights; to establish the faculties and attributes to establish and approve the content of prepaid comprehensive health care service plans and contracts and insurance in medical assistance matters; as well

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| Postal Code: 170507 | Quito - Ecuador |
as to determine the competence for the application of the sanctioning regime and the resolution of controversies; That, in accordance with what is stated in article 2 ibidem, the Organic Law that Regulates Companies that Finance Prepaid Comprehensive Health Care Services and Insurance Companies that Offer Medical Assistance Insurance Coverage is applicable to all activities developed, in fulfillment of their corporate object, by companies that finance prepaid comprehensive health care services; That, Article 3 of the aforementioned Organic Law, determines as guiding principles for the application of said law, those of legality, juridicity, inclusion, equity, precaution, equality, non-discrimination, sustainability, bioethics, gradualness, sufficiency, efficiency, effectiveness, transparency, timeliness, quality, warmth, free competition, responsibility, and participation; That, Article 10 of the Organic Law that Regulates Companies that Finance Prepaid Comprehensive Health Care Services and Insurance Companies that Offer Medical Assistance Insurance Coverage, when referring to solvency regimes, equity, technical reserves, and provisions, prescribes that companies that finance prepaid comprehensive health care services must maintain, at all times, solvency requirements, based on technical equity, mandatory investments, as well as technical reserves constituted and accounted for, calculated by qualified actuaries, which will include: reserves for services provided and not reported, reserves for services provided and reported; and, those others determined by the Superintendency of Companies, Securities, and Insurance; That, Article 17 of the cited Organic Law states, in its numbers 1 and 8, that the Superintendency of Companies, Securities, and Insurance, regarding companies that finance prepaid comprehensive health care services, will have, among others, the faculties of corporate, financial, and non-health contractual supervision and control, in accordance with what is established in the Companies Law, the Organic Monetary and Financial Code, the Organic Law that Regulates Companies that Finance Prepaid Comprehensive Health Care Services and Insurance Companies that Offer Medical Assistance Insurance Coverage, and the regulations, resolutions, and more current normative; as well as, the other faculties provided in the Law; That, the First General Provision of the Organic Law that Regulates Companies that Finance Prepaid Comprehensive Health Care Services and Insurance Companies that Offer Medical Assistance Insurance Coverage, provides that the Financial Policy and Regulation Board, provided for in the Organic Monetary and Financial Code, will have the faculty to issue regulations applicable to companies that finance prepaid comprehensive health care services, of an economic, financial, and accounting nature; and, in relation to the methodology and method of calculation of technical reserves, established by said Law and those determined by the
Superintendency of Companies, Securities, and Insurance, in accordance with what is provided in article 10 of the cited Organic Law, taking into account obligatorily their characteristics and specifics; That, the Twenty-Ninth General Provision of the Organic Monetary and Financial Code, Book I, prescribes: "In the current legislation in which mention is made of the 'Monetary and Financial Policy and Regulation Board', replace it with 'Financial Policy and Regulation Board'."; That, the Fifty-Fourth Transitional Provision of the previously mentioned Code determines the transitional regime of resolutions of the Codification of the Monetary and Financial Policy and Regulation Board, establishing that: "(...) The resolutions contained in the Codification of Monetary, Financial, Securities, and Insurance Resolutions of the Monetary and Financial Policy and Regulation Board and the norms issued by control bodies, will maintain their validity until the Monetary and Financial Policy and Regulation Board and the Financial Policy and Regulation Board decide what corresponds, within the scope of their competencies."; That, Article 15 of the Organic Administrative Code, with reference to the principle of responsibility, provides that the State will respond for damages as a consequence of the lack or deficiency in the provision of public services or the actions or omissions of its public servants or the subjects of private rights who act in the exercise of a public power by delegation of the State and its dependents, controlled or contractors, being the State who will make effective the responsibility of the public servant for intentional or negligent acts or omissions, stating that no public servant is exempt from responsibility; That, the penultimate paragraph of article 14.1 ibidem determines that the Superintendent of Companies, Securities, and Insurance can propose regulation projects for consideration by the Financial Policy and Regulation Board, with the backing of the respective technical reports; That, through Letter No. SCVS-INS-2023-00053498-O of June 30, 2023, the Superintendent of Companies, Securities, and Insurance presented to the Financial Policy and Regulation Board a proposal for a norm regarding mandatory investments for companies that finance prepaid comprehensive health care services. For this effect, attached was the "TECHNICAL REPORT ON THE PROJECT FOR MANDATORY INVESTMENT NORM FOR COMPANIES THAT FINANCE PREPAID COMPREHENSIVE HEALTH CARE SERVICES", undated, issued by the National Insurance Superintendent of said control body, as well as, the corresponding draft resolution; That, the Superintendency of Companies, Securities, and Insurance through Letter No. SCVS-INS-2025-00023175-O of March 25, 2025, sent for consideration and analysis by the Board the Technical Report on the project of "MANDATORY INVESTMENT NORM FOR COMPANIES THAT FINANCE PREPAID COMPREHENSIVE HEALTH CARE SERVICES", along with an adjusted norm proposal, as well as
additional observations and suggestions for the norm project previously sent by the Financial Policy and Regulation Board; That, the Technical Secretary of the Financial Policy and Regulation Board, through Memorandum No. JPRF-ST-2025-0021-M of April 4, 2025, sends to the President of the Board the Technical Report No. JPRF-CTIFSP-2025-0002 of April 4, 2025, issued by the Technical Coordination of Financial Inclusion and Prepaid Health Policy; as well as the Legal Report No. JPRF-CJF-2025-010 of April 4, 2025, issued by the Legal Coordination of Financial Policy and Norms of this Board, as well as the respective draft resolution; That, the Financial Policy and Regulation Board, in an ordinary session held by technological means, convened on April 4, 2025, and carried out through video conference on April 9, 2025, learned of Memorandum No. JPRF-ST-2025-0021-M of April 4, 2025, issued by the Technical Secretary of the Board; as well as the aforementioned Technical Report No. JPRF-CTIFSP-2025-0002 and Legal Report No. JPRF-CJF-2025-010, in addition to the corresponding draft resolution; That, the Financial Policy and Regulation Board, in an ordinary session held by technological means, convened on April 4, 2025, and carried out through video conference on April 9, 2025, learned of and approved the following Resolution; and, In exercise of its functions,

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| Postal Code: 170507 | Quito - Ecuador |
RESOLVES:
SINGLE ARTICLE.- Incorporated as Chapter III of Title VII "Technical Prudential Norms for Companies that Finance Prepaid Comprehensive Health Care Services", Book III "Private Insurance System" of the Codification of Monetary, Financial, Securities, and Insurance Resolutions, the following text:
"CHAPTER III: MANDATORY INVESTMENT NORM FOR COMPANIES THAT FINANCE PREPAID COMPREHENSIVE HEALTH CARE SERVICES
SECTION I: OBJECT, SCOPE, AND DEFINITIONS
Art. 1.- Object and scope.- This norm will be applicable to companies that finance prepaid comprehensive health care services, in accordance with what is provided in article 10 and the First General Provision of the Organic Law that Regulates Companies that Finance Prepaid Comprehensive Health Care Services and Insurance Companies that Offer Medical Assistance Insurance Coverage.
Art. 2.- Definitions.- For the purposes of this norm, the following will be understood:
a. Maturity Matching.- Making investments ensuring the matching between technical reserves and the assets backing them. The flows from said investments must be structured in a way that maintains concordance in term, amount, and liquidity with estimated future obligations, derived from prepaid comprehensive health care service plans issued; the technical matching must be evaluated with a monthly periodicity. b. Available.- Cash or cash equivalents with which the company that finances prepaid comprehensive health care services has to satisfy commitments or immediate payment obligations.
c. Mandatory Investment.- The amount that companies that finance prepaid comprehensive health care services must invest to back their entire technical reserves and to be able to comply with obligations derived from contracts.
d. Investment Deficiency.- The difference between mandatory investment versus admitted investment, made by companies that finance prepaid comprehensive health care services, whenever the admitted is less than the mandatory. e. Fixed Income Investment.- That whose return does not depend on the results of the issuing company, but is predetermined at the time of issuance and accepted by the parties. f. Admitted Investment.- The sum of the investments of companies that finance prepaid comprehensive health care services, recognized as backing for technical reserves, that comply with the guidelines established in this norm. g. Multilateral Organization.- A financial institution constituted through treaties between sovereign States with the main objective of promoting economic cooperation, financial intermediation, provision of financing for development, monetary stability, or multilateral financial assistance.

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| Postal Code: 170507 | Quito - Ecuador |
h. Supranational Organization.- An entity constituted through international treaties, endowed with express competence on sovereign financial considerations, to which member States have ceded the faculty to adopt decisions and issue regulations with binding character in economic or financial matters, which prevail over national regulations in the scopes of its competence.
i. Systemic Risk.- The set of circumstances that threaten the stability of the national financial system, potentially triggering a contagion effect on participants in the financial system, generating losses of economic value or confidence, increasing uncertainty about the financial system as a whole and/or generating adverse effects in the real economy.
SECTION II: MANAGEMENT OF MANDATORY INVESTMENTS
Art. 3.- Management of mandatory investments.- The general shareholders' meeting of companies that finance prepaid comprehensive health care services must incorporate into its statutes the following functions:
1. The approval of the formation of the investment rating committee, and,
2. The approval of policies and procedures for the management of mandatory investments.
3. The instance of approval of investments within the framework of the established policies and procedures.
Art. 4.- Investment rating committee.- The integration of the investment rating committee must be consistent with the nature, complexity, and volume of the business of the company that finances prepaid comprehensive health care services and will be composed of:
1. A delegate from the corresponding administrative body, who will act as president of the committee and will have the casting vote;
2. The legal representative of the company; and,
3. The highest-ranking official responsible for the review of the company's risks.
The financial manager or treasurer, or whoever acts in their place, will participate obligatorily in the investment rating committee, with an informative voice, without having the right to vote.
Art. 5.- Operation of the investment rating committee.- It is the responsibility of the investment rating committee to monitor that the investments of companies that finance prepaid comprehensive health care services are carried out subject to the principles of security, liquidity, diversification, and profitability, in accordance with the policies of the corresponding administrative body, the provisions of the Superintendency of Companies, Securities, and Insurance, and this norm. The investment rating committee will meet at least one (1) time per month, from whose sessions a minutes will be drawn up, which will be available to the Superintendency of Companies, Securities, and Insurance during their on-site visits. The legal representative of the company that finances prepaid comprehensive health care services will send to the control entity the resolutions adopted, known, and approved by the general shareholders' meeting or the collegiate body of each company, within a maximum period of eight (8) days counted from the date of the session.

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| Postal Code: 170507 | Quito - Ecuador |
Art. 6.- Duties and attributes of the investment rating committee.- The investment rating committee will have the following duties and attributes:

1. Propose for approval by the corresponding administrative body, the policies, evaluation methodologies, parameters, limits, indicators, and other controls necessary to mitigate the risks inherent to the administration of the entities' portfolio;
2. Design investment programs and mechanisms for companies that finance prepaid comprehensive health care services;
3. Evaluate the structure of the investment portfolio and its performance, in such a way that it is adequate to the entity's risk profile;
4. Evaluate the maturity matching of the company with monthly periodicity;
5. Take knowledge and recommend the approval of the forms to be sent to the Superintendency of Companies, Securities, and Insurance regarding mandatory investments and maturity matching, and send them for consideration of the corresponding administrative body;
   and,
6. Recommend corrective measures in case the strategies, policies, processes, methodologies, and procedures so require.
   The investment rating committee must take into account the recommendations issued by the internal audit unit and external auditors, if they exist, who must carry out the necessary verifications to determine the adequate classification, valuation, and accounting recording of the investments; as well as the compliance with the criteria established in the policies and procedures for investment management. Art. 7.- Policies and procedures for the management of mandatory investments.- Companies that finance prepaid comprehensive health care services must have mandatory investment policies and procedures, approved by the corresponding administrative body, with the definition of criteria, limits, and responsibilities, in compliance with the principles of security, liquidity, diversification, and profitability, in that order. The policies and procedures must consider:
   a. Applicable criteria to identify, evaluate, control, and monitor the level of risk of investments; b. Adequate limits to mitigate investment risk by issuer, by type of security, and other criteria considering what is provided in this norm, internal policies, and those that, for this effect, the control body defines;
   c. Parameters for the selection of investments and periodic evaluation of the risk level, in accordance with the provisions established in this norm;
   d. Actions that must be considered in the administration of the portfolio to mitigate or control risk levels when they exceed the thresholds defined as acceptable by the company; and, e. Mechanisms for monthly validation of compliance with the guidelines for the administration of the mandatory investment portfolio established in this norm.

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| Postal Code: 170507 | Quito - Ecuador |
Art. 8.- Mandatory investments.- Companies that finance prepaid comprehensive health care services must invest one hundred percent (100%) of their technical reserves under the guidelines detailed in the following articles.
Art. 9.- Guidelines for the administration of the mandatory investment portfolio.- Companies that finance prepaid comprehensive health care services must carry out mandatory investments considering at least the following parameters:

1. Security:
   a. Investment instruments will correspond to issuers that meet the following characteristics:
   (i) National public and private issuers must have a risk rating carried out by risk rating companies authorized by the Superintendency of Companies, Securities, and Insurance, equal to or higher than AA+. Values issued by the Ministry of Finance or the Central Bank