The year 2014 has been a favorable year for the insurance market and even more so for La Positiva Seguros. Our main insurance lines registered a growth above the average of the industry, which is reflected in the increase in equity and profit of the group.

La Positiva Vida Life Annuities rose by 48% with respect to the previous year, thereby making us the Company with the largest growth in said line of the market, contributing to the production of our insurance group in the first place. Another significant result was achieved by the Occupational Life and Disability Insurance (SCTR) that grew by more than 49% in comparison to the previous year.

La Positiva Seguros Generales (Property and Casualty) has experienced the most important development in the automobile insurance market, growing 37% due mainly to the launch of our product Vehicular Pack, designed to allow the customers to hire the covers they require according to their needs.  Furthermore, the Mandatory Traffic Accident Insurance (SOAT) grew 16% with respect to the previous year, thereby allowing us to maintain our leadership in time, with a market share of over 52%.

This auspicious panorama of the insurance market was not necessarily accompanied by the good economic performance of the country.  In 2014, the main macroeconomic indicators registered a reduction and stagnation influenced by a yet unfavorable international scenario and the drop in the prices of the main commodities exported by Peru. 

However, our commitment towards the development of Peru remains intact through the offer of insurance policies available to the large majorities, thereby making our presence more extensive throughout the country, through our customer service agencies and insurance promoters who permanently advise the millions of Peruvians who expect to be suitably protected in the event of a loss.

Letter to the Shareholders

In compliance with the provisions of the Business Corporations Act and our Bylaws, we hereby present for the information and approval of our Shareholders, the Annual Report for the financial year ended December 31, 2014. This report includes the Balance Sheet and the Profit and Loss Statement of La Positiva Seguros y Reaseguros and of La Positiva Vida Seguros y Reaseguros. These documents have been audited by the firm Dongo-Soria Gaveglio y Asociados Sociedad Civil de Responsabilidad Limitada, a member firm of the PricewaterhouseCoopers International Limited (PwCIL) network.

Acknowledgements

We at La Positiva Seguros y Reaseguros and La Positiva Vida Seguros y Reaseguros would like to express our appreciation to our insurance brokers, agents, and promoters for their invaluable assistance; and to our suppliers and reinsurers, for the trust placed in our Company. Likewise, we are grateful for the collaboration of our managers, officers, and employees, for their effort, teamwork, and sense of responsibility and professional excellence. We would especially like to express our sincerest gratitude to our customers, since they are the ones who enabled us to achieve the results submitted in this Annual Report.

During 2014, we have carried out the following initiatives that have set the bar for activities of the La Positiva Seguros Group whose importance is reflected in the several stakeholders we work with.

• Successful implementation of the ERP SAP Project (Enterprise Resource Planning System) in its first stage, in strategic partnership with IBM del Perú, as implementer of the ERP, and Ernst & Young, as a consultant. La Positiva Seguros will thus become the first insurance group in the Peruvian market to support its administrative, accounting, and finance system with SAP, a solution used by leading companies throughout the world. The duration of this stage of the project was two years, at a cost of more than US$ 15 million and more than 100 collaborators dedicated exclusively to the development and completion of said project.
• In terms of product innovation, in 2014 low cost insurance policies were designed with the aim of covering the unattended segments of the population.  To this effect, the new Vehicular Pack was launched, an insurance for automobiles that adapts to the needs of its customers by offering them the opportunity of choosing the coverage they wish to hire.  The Vehicular Pack offer is based on a number of third party liability plans, total loss by theft, total loss by collision and damages by accidents. In addition, the insurance plan offers all of its users free protection against personal accidents for vehicle occupants/passengers.
• The SME Protection Insurance was also launched, a line aimed at the small and medium enterprises that offers the necessary support to ensure their continuity.  Its plans offer policies that include damages due to casualties to establishments, machinery, equipment and other property.  It also covers the integrity and health of business owners, offering them and their family access to benefits such as home medical treatment, medical advice over the phone and home delivery of medicines, among others.
• With the aim of reaching out to our customers, we maintain a strategy of decentralization of our operations and services. This year, La Positiva Seguros has ventured into a new type of offices open to the public, located in shopping centers with a large affluence of public,  opening small establishments in several districts of Lima (San Miguel, Santa Anita, Surco, Bellavista and Independencia) and Arequipa (Yanahuara and José Bustamante y Rivero).
• For the fifth year running, La Positiva Vida was recognized as one of the best places to work, ranked 9th in the category of companies with a work force of between 251 and 1000 employees, according to the organizational environment survey conducted by the Great Place to Work Institute.  In addition, La Positiva Seguros received the ABE Prize to Social Labor Responsibility, in the category of Prize to the Best Benefits Program, from the Association of Good Employers of the American Chamber of Commerce of Peru, thanks to its program Vive Positivo [Live Positive]. These important distinctions evidence our permanent focus on the management of persons and the development of our collaborators, seeking a balance between the professional and personal life. 
• We ended the year with the approval by the International Financial Corporation (IFC) a member of the World Bank Group, of an investment of US$18 million in favor of La Positiva Seguros, granted through a subordinated convertible loan, aimed at boosting the expansion of the insurance industry in the poorer sectors of the Peruvian population.  This evidences that both institutions are striving to reach the poorer sectors of the population, especially those located in the provinces of Peru.
• La Positiva Sanitas has health plans for persons (optional) and for their families, as well as for companies (regular).  The health plans portfolio has allowed it to gradually position itself in the Peruvian market, venturing in the provinces, a market with a demand that continues to be unattended. The SME and Micro and Small Enterprises (Mypes) segment is one of the sales targets of the company, a segment that presently has a major opportunity to grow.
• Additionally, through the holding, Inversiones en Salud S.A. companies such as Salud Ocupacional Sanitas, in charge of offering occupational safety and health services in the Peruvian market, and the Empresa Prestadora en Servicios de Salud (Health Service Provider Company) that manages our Medical Centers in Lima (Occupational Health) and Arequipa, are penetrating the market.
• With regard to the year 2013, in 2014, La Positiva Sanitas registered an important increase in its Health, Occupational Life and Disability Insurance (SCTR) Plans and in the System of Private Healthcare Providers (EPS) of 68%, 33% and 4%, respectively.

Since its creation, La Positiva Seguros Group has assumed its commitment with the poorest populations of the country in these 77 years of existence.  In 2014, we have continued with our vision of service on behalf of Peruvian society, through the creation of micro-insurance plans that offer low cost protection and which are marketed in the cities and in the rural areas, aimed at the widespread increase of insurance plans in the country, in addition to the development of agricultural insurance plans and the promotion of education and culture in the Peruvian population.

In the field of micro-insurance and mass insurance, at present there are insurance plans that cover life (for natural and accidental death, indemnity, funeral and monthly income), health (outpatient: payment for hospitalization, illnesses, accidents), unemployment (involuntary dismissal), theft and robbery, fire, automobile and disability due to illness or accident; products that provide protection to the insured population against events that affect their normal flow of income that, in turn, affect the subsistence of the family.  These plans are primarily supplied through financial and micro-financial institutions, retailers and mobile network operators, the challenge for La Positiva Seguros being to venture in non-traditional channels, such as chains of drugstores, stores and gas stations, among others.

Continuing with the work in rural populations, throughout 2014, more than 53,000 farmers with limited resources entered the formal financial system thanks to the opening of savings accounts promoted by La Positiva Seguros to pay the compensations of the Catastrophe Agricultural Insurance (CAI) in four regions: Ayacucho, Cajamarca, Pasco and Puno. Additionally, La Positiva Seguros has agreements with different rural banks, municipalities and cooperatives to facilitate access to the financial system in the different communities and prevent the migration of the rural inhabitants to the large cities which are, in many cases, remote.

Within the context of additional support to subsistence farmers, La Positiva Seguros is disseminating brochures on Good Farming Practices that help the average farmers to address important factors to guarantee the success of their crop.

During this year and thanks to the execution of a cooperation agreement between the Rural Agricultural Productive Development Program (AGRO RURAL) and La Positiva Seguros we have been able to develop and supplement resources, skills, the exchange of know-how, experiences and initiatives, aimed at achieving a greater financial inclusion in the rural population.

In 2014, we have launched the text messaging service for the nationwide rural populations that enable us to inform our customers of the benefits, promotions, payment of indemnities and renewals of our products.

Thanks to the implementation of these initiatives, we were finalists in Business Creativity for promoting the Insurance Culture in Rural Populations.

As part of its other social responsibility actions, La Positiva Seguros took part once more in the “Mathematics for Everyone” program. This program is aimed at inspiring a love for mathematics and strengthening math learning, thus contributing to the intellectual upbringing of children and adolescents and aiding in their personal and social progress. This year, the support of La Positiva Seguros was materialized by the purchase of educational materials such as books and work charts, and by the training workshops held in the schools where the program is being implemented.

In addition, in its activities for the promotion of Peruvian culture, La Positiva Seguros introduced the book “Perú Submarino”, a text that records the diversity of underwater marine species present in the coast of Peru. This book was edited by Apus Graph Ediciones and is a summary of the research carried out by the fisheries biologist, deep-sea diver and photographer of Trujillo, Yuri Hooker Mantilla.  The publication is designed to disseminate new scientific records for Peru on the marine species of our country.

These last two initiatives have a deep cultural and educational approach, with which La Positiva Seguros contributes to the education of the Peruvian population.