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Ajantha Weerasekara - Engagement PartnerContact detailsOffice: 94 11 5426408Mobile: 94 77 031732Email: aweerasekara @kpmg.comNameAjantha WeerasekaraPositionPrincipal – Deal Advisory, KPMG Sri Lanka.Qualifications Masters in Finance, London Business School Chartered Financial Analyst (CFA) Associate Member of the Chartered Institute of Management Accountants, UK(ACMA) BSc. Finance (First Class), University of Sri Jayewardenepura, Sri Lanka Ajantha counts over 14 years of experience in financial services in Sri Lanka andabroad, and currently leading the Business, Property and Asset Valuations andRestructuring and Turnaround services in KPMG Sri Lanka. He has alsosuccessfully led a range of advisory engagements including M&As, financialfeasibilities and other corporate finance related transactions. Ajantha currently leads several valuation engagements which involves businessand property valuations in sectors such as, hotels and resorts, consumerdurables, consumer staples, food and beverage, conglomerates, construction andbuilding materials, financial services, real estate and property developments, etc. Ajantha currently serves as the Engagement Partner in several financialrestructuring and turnaround transaction related to large conglomerates in SriLanka, which involves restructuring of financial management, processes,structures and balance sheet, negotiating with banks on rescheduling of loans,liquidating non-operating assets and sourcing strategic and financial equityinvestors. Ajantha has recently led teams which carried out several resort and islandvaluations in Maldives and a number of hotels, resorts, lands and buildingsvaluations in Sri Lanka. Ajantha has successfully led a cross-functional teams to support the implantationof corporate restructuring engagements for several listed conglomerate in SriLanka, which were expected to increase the overall market value of the respectivefirms. He also led the pioneering corporate restructuring engagement for a blue-chiplisted conglomerate in Sri Lanka, which saw c.30% increase in its market valuepost-restructuring. This project was one of the major transactions that wentthrough Colombo Stock Exchange in 2016. Led a team which successfully closed an M&A transaction in the Manufacturingsector, in which KPMG was the sell-side advisor. He also served as the Engagement Director in a large valuation transaction in theBeverages sector related to large conglomerates in Sri Lanka, which also involvesintangible asset valuation, detailed financial due diligence, tax advisory servicesand accounting advisory services. Prior to rejoining KPMG, Ajantha led the Corporate Finance division in adiversified financial services company. He successfully coordinated the fullacquisition of this diversified financial services company in 2013 and wasinstrumental in introducing the parties to the transaction. Ajantha has led valuation teams that have carried out earnings and asset basedvaluations of a number of companies across global markets such as UK, Europe,China, Hong Kong, India, Malaysia, etc. The sectors covered includes Insurance,Oil and Gas, Banks, Leisure, Retail, REITs, etc.ExperienceDomainExperienceBanking & Finance, Insurance, Financial Services, Construction and building material,Telecommunication, Leisure, Manufacturing, Retail, Consumer goods, Food,Beverages and Tobacco, Real Estate – valuation and advisory. KPMG Deal Advisory (Private) Limited, a fully owned subsidiary of KPMG Holdings (Private) Limited , a sub licensee of KPMG InternationalLimited, a private English company limited by guarantee. All rights reserved.Document Classification: KPMG Confidential5

Kasun Gunawardhana – Engagement ManagerNameKasun GunawardhanaPositionManager– Deal Advisory, KPMG Sri Lanka.QualificationsExperienceContact detailsOffice : 94 11 5426278Mobile : 94 777 891271Email:kgunawardhana@kpmg.comDomainExperience B.Sc. Accounting (Special) - University of Sri Jayewardenepura, Sri Lanka Associate Member of the Institute of Chartered Accountants of Sri Lanka (ACA) Kasun accounts for over nine years of experience in auditing, financial modelingand financial research and has a successfully lead and assisted a range ofengagements in auditing, valuations and equity research. He currently serves in the Deal Advisory Services division in KPMG and counts forover three year of experience. In his current capacity as an Engagementmanager, he serves for projects involved in capital raising, private equity, debtadvisory, business valuations, property valuations, group restructuring andmergers and acquisitions. His experience in KPMG includes;oCarrying out equity valuation, brand valuation and property valuation advisoryservices for clients including a diversified conglomerate, a licensed financialinstitution listed on the Colombo Stock Exchange, private companies engagedin trading, FMCG and agriculture.oCarrying out detailed financial feasibility for startup businesses for privateequity financing purposes in the industries of fish farming, power and energy,plantations, hotels and restaurants.oAdvice on funding solutions for distressed clients such as debt instruments,debt restructuring and hybrid instruments and assist the client in negotiationwith banks and potential investors.oAssisting the client in recognizing optimal group structure to unlock the valuesand for effective and smooth fund flows within the group to maximize thewealth of the owners. Here the analysis covers the implications in terms oftaxation, provisions in the Companies Act, Secretarial requirements and CSEand SEC regulations.oCarried out the local firm’s first sector review magazine for banking andinsurance sectors of Sri Lanka. Prior to joining KPMG Sri Lanka in early of 2018, Kasun gathered over six yearsof experience in auditing as well as in the equity investment industry. He has led several audit engagements in Micro Finance, Financial Institutions,Manufacturing and construction, plantations and agriculture sectors in thecapacity of an Audit Manager. In the capacity of Financial Analyst of a prominent Fund Management company inSri Lanka, he did Equity Research on companies in the sectors of Banking andfinancial services, Diversified Conglomerates, Construction, Manufacturing,Plantation, FMCG, Liquor and Tobacco, Construction Material sectors. Kasun is experienced in performing tasks and monitoring teams to delegateresponsibility, prepare progress reports and deliver presentations while directlyliaising with clients throughout the engagement process.Property, Non Banking and Micro Finance, Insurance, Construction, Manufacturing,Plantations, Retail, FMCG. KPMG Deal Advisory (Private) Limited, a fully owned subsidiary of KPMG Holdings (Private) Limited , a sub licensee of KPMG InternationalLimited, a private English company limited by guarantee. All rights reserved.Document Classification: KPMG Confidential6

Sandunika Warnasooriya – Assistant ManagerNameSandunika WarnasooriyaPositionAssistant Manager– Deal Advisory, KPMG Sri Lanka.QualificationsExperienceContact detailsOffice : 94 11 5426238Mobile : 94 71 534 3049Email:swarnasooriya@kpmg.comDomainExperience Associate Member of the Chartered Institute of Management Accountants, UK(ACMA)/ Chartered Global Management Accountant (CGMA) CFA Level III Candidate Sandunika is an experienced financial analyst with over five years of experience inglobal and local Financial Services industry specialising in valuations, financialmodelling, investment research and ESG. She joined KPMG in May 2021 and is currently working in the Deal Advisorydivision. Her experience at KPMG includes, carrying out equity valuations, brand valuationsand start up valuation services for clients in hospitality, commercial services,technology, financials, educational and power and energy sectors. Prior to KPMG, Sandunika worked at a leading financial services company forabout five years in both buy-side and sell-side engagements involved in financialmodelling and comprehensive report writing including earnings reviews, companyand industry research. She had exposure to sectors like telecommunications,retail, airlines, shipping etc. Sandunika is also experienced in carrying out forensic analysis in identifyingissues with financial statements and corporate governance. She also has about a one year of experience in Business Systems Analysis at amultinational ERP solutions provider. There, she acted in the capacity of a ProcessMaster ensuring smooth and efficient functioning of the team. Sandunika started her career in 2015 with an internship at a local stock researchfirm.Telecommunications, Industrials, Airlines, Retail, Hospitality, Educational, Financials,Technology, Shipping, Power and Energy KPMG Deal Advisory (Private) Limited, a fully owned subsidiary of KPMG Holdings (Private) Limited , a sub licensee of KPMG InternationalLimited, a private English company limited by guarantee. All rights reserved.Document Classification: KPMG Confidential7

Piyumi Gamage – Senior ConsultantNamePiyumi GamagePositionSenior Consultant – Deal Advisory, KPMG Sri Lanka.QualificationsContact detailsOffice : 94 11 5426240Email:pdhananjana@kpmg.comExperience Associate Member of the Institute of Chartered Accountants of Sri Lanka (ACA) B.Sc. Accounting (Special) University of Sri Jayewardenepura, Sri Lanka Master of Development Studies (Reading) University of Colombo Piyumi is an experienced finance professional with over four years of experiencein corporate finance, IFRS and taxation in both practice and industry. Prior to joining KPMG in February 2021, she served as a team member of thegroup finance function of a leading apparel export group of companies in SriLanka for three years. Piyumi has also worked as an associate at PricewaterhouseCoopers Sri Lanka –Tax services. DomainHer experience at KPMG includes;oCarrying out equity valuation and advisory services for clients including adiversified conglomerate, a licensed financial institution and privatecompanies engaged in the sectors of power and energy, manufacturing andtrading.oCarrying out detailed financial feasibility for startup businesses for privateequity financing purposes in the recreational industry.Financial services, Manufacturing, Energy and power, Hotel and tourismExperience KPMG Deal Advisory (Private) Limited, a fully owned subsidiary of KPMG Holdings (Private) Limited , a sub licensee of KPMG InternationalLimited, a private English company limited by guarantee. All rights reserved.Document Classification: KPMG Confidential8

Disclaimer—KPMG’s role will be limited to preparation of the memorandum, on your behalf, and on the basis of informationreceived from LGIL. Suitable wordings and disclaimers describing our role and limiting our liabilities will be includedin the memorandum.—We will not be making any recommendations to you and will provide values based on the valuation exercise. Thecomplete and final control and responsibility of all key decisions, including but not limited to, those concerning theprice will rest with you.—For the purpose of carrying out this assignment, we will rely largely on inputs and information provided by you and onpublished and secondary sources of information that we believe to be credible and reliable. We will not beresponsible for errors and inaccuracies in the base data supplied to us. The procedures we will perform will notconstitute an audit and, consequently, no assurance will be expressed.—We will review the projected financials/ information/ document from a commercial perspective to assess the impacton the business and will not comment on the appropriateness of or independently verify the assumptions orinformation provided to us. We will not be expressing any legal or tax opinion on the same.—Further, note that since the strategy and plans relate to the future, actual results are likely to be different from theprojected assumptions because events and circumstances may not occur as expected, and the differences may bematerial. In carrying out the assignment, we rely extensively on technical, financial and other information madeavailable to us by you and your team and any other person(s) you may nominate to provide information to KPMGwith respect to the engagement.—It is clarified that commercial and legal due diligence, feasibility, formal opinion on the assumptions underlying theprojections, and technical valuation of the assets will not form part of our work.—Our analytical efforts will be executed on a best-efforts basis, being dependent on the availability of data in the publicdomain and in our databases. KPMG will depend on existing available information on the geographies and markets,which might be in the form of publicly available reports, KPMG’s Internal Knowledge Base (firm-wide intranet), etc. Allindustry and competitor analysis will be carried out based on information available in the secondary domain. WhileKPMG shall make all necessary efforts to ensure that it will source data only from credible public sources, we cannotpossibly verify the accuracy of the same.—KPMG will not have the responsibility of updating the deliverable after the conclusion of the engagement, or thesubmission of the final valuation memorandum, unless otherwise agreed through a separate scope of work.—While undertaking this Engagement, neither KPMG nor any of its members or employees will assume or be requiredto assume any responsibility for the Management, the sole responsibility of which remains with the Company and itsmanagement. Management of the Company will be responsible for considering the outcomes of the servicesprovided by KPMG and for any actions arising from such services. KPMG Deal Advisory (Private) Limited, a fully owned subsidiary of KPMG Holdings (Private) Limited , a sub licensee of KPMG InternationalLimited, a private English company limited by guarantee. All rights reserved.Document Classification: KPMG Confidential9

KPMG Deal Advisory (Private) Limited(Chartered Accountants)32A, Sir Mohamed Macan Markar Mawatha,TelFax 94 - 11 542 6426 94 - 11 244 5872 94 - 11 244 6058P. 0. Box 186,Colombo 00300, Sri Lanka.Internetwww.kpmg.com/lkPrivate and Confidential28 October 2021The Board of Directors,LOLC General Insurance Limited,No. 100/1, Sri Jayawaradanepura Mawatha,Rajagiriya.Memorandum regarding the valuation of LOLC General Insurance LimitedWe enclose our memorandum in relation to the valuation of LOLC General Insurance Limited (“LGIL”) as the independentvaluer for its proposed Initial Public Offering as per the CSE listing rules 3.1.4 (c)., as requested by LGIL.This memorandum has been prepared on the basis of fieldwork carried out up to 27 October 2021. We have completedthe work required to enable us to report fully in accordance with the terms of reference set out in our engagement letterdated 29 June 2021 and the subsequent addendum to it dated 28 October 2021.We have not undertaken to update our valuation memorandum for events and circumstances arising after that date. Incarrying out our work, we have relied upon information provided by the Management of LGIL. We have not audited orcarried out due diligence procedures on the information and therefore we make no representations as to its accuracy andcompleteness.Our memorandum is for the above-mentioned purpose only and they will be shared, quoted or referred to, in whole or inpart only with the stakeholders identified for the purposes of the proposed IPO.The terms of reference for this valuation memorandum, included as part of the Engagement Letter and the addendum,have been agreed by you and we will not accept responsibility to any other party to whom the valuation memorandummay be shown or who may acquire a copy.Yours faithfully,KPMG Deal Advisory (Private) LimitedKPMG Deal Advisory (Private) Limited, a fully owned subsidiary ofKPMG Holdings (Private) Limited , a sub licensee of KPMGInternational Limited, a private English company limited byguarantee. All rights reserved.DirectorsM. R. MihularC. P. JayatilakeP. Y. S. PereraH. S. Gonnewardene KPMG Deal Advisory (Private) Limited, a fully owned subsidiary of KPMG Holdings (Private) Limited , a sub licensee of KPMG InternationalLimited, a private English company limited by guarantee. All rights reserved.Document Classification: KPMG Confidential10

ContentsThe contacts at KPMGin connection with thisreport are:Ajantha WeerasekaraPrincipal,KPMG Sri LankaTel: 94 770 031732aweerasekara@kpmg.comKasun GunawardhanaManager,KPMG Sri LankaTel: 94 778 593480kgunawardhana@kpmg.comSandunika WarnasooriyaAssistant Manager,KPMG Sri LankaTel: 94 715 343049swarnasooriya@kpmg.comIntroduction13— Industry overview and analysis14— Company overview22Key assumptions27—Basis for forecasts28—Forecast assumptions29—Sensitivity analysis33Methodology and approach35—Valuation methodology summary36—Valuation approach37—Cost of equity and terminal value38Valuation summary39Valuation and interpretation42—Residual income methodology43—Net Asset Value45—Justified price to book value methodology46—Market multiples methodology47Validity period48Financial statements49—Key ratio analysis50—Income statement51—Balance sheet52Appendices53—GWP assumptions54—Local peers55—Regional peers56— Management accounts57—Sources of information59 KPMG Deal Advisory (Private) Limited, a fully owned subsidiary of KPMG Holdings (Private) Limited , a sub licensee of KPMG InternationalLimited, a private English company limited by guarantee. All rights reserved.Document Classification: KPMG Confidential11

GlossaryBnBillionNITFNational Insurance Trust FundCAPMCapital Asset Pricing ModelNWPNet Written PremiumCARCapital Adequacy RatioP/BVPrice to Book ValueCBSLCentral Bank of Sri LankaP/EPrice to EarningsCLCCommercial Leasing & Finance PLCQoQQuarter on QuarterCSEColombo Stock ExchangeRIResidual IncomeFYEFinancial Year EndingROAReturn on AssetsGDPGross Domestic ProductROEReturn on EquityGWPGross Written PremiumTACTotal Available CapitalIBSLInsurance Board of Sri LankaTTMTrailing twelve MonthsIRCSLInsurance Regulatory Commission of Sri LankaYoYYear on YearJ/PBVJustified Price to Book ValueYTDYear to DateKeCost of EquityKPMGKPMG Deal Advisory Private LimitedLGILLOLC General Insurance LimitedLKRSri Lankan RupeeLOLCLOLC Holdings PLCManagementManagement of LGILMEMonths EndingMMMMarket Multiple MethodologyMnMillionMRPMarket Risk PremiumNAVNet Asset Value KPMG Deal Advisory (Private) Limited, a fully owned subsidiary of KPMG Holdings (Private) Limited , a sub licensee of KPMG InternationalLimited, a private English company limited by guarantee. All rights reserved.Document Classification: KPMG Confidential12

Introduction

Industryoverview andanalysis

Industry overview and analysisInsurance sector in Sri LankaOverview— As of October 2021, 27 insurance companies are operating in Sri Lanka except National Insurance Trust Fund(“NITF”), comprising of 13 long-term insurance companies, 12 general insurance companies and 2 companies involvedin both. (Source: https://ircsl.gov.lk/insurance-companies/. Date of access: 18 October 2021)— During 2016-2020, insurance sector GWP has been growing at a CAGR of 9.9% driven by the growth of life insuranceand general insurance businesses whose GWP recorded a CAGR of 12.9% and 7.3% respectively . (Source: IRCSLStatistical Review – 2020)— In 2020, general insurance GWP faced a -2.0% drop YoY, due to economic downturn caused by COVID-19 pandemicand the resulting vehicle import restrictions, with motor insurance being the biggest driver of general insurance sectorin Sri Lanka. (Source: IRCSL Statistical Review – 2020)GWP over the years (LKR' 88.860.030.00.020162017Insurance sector20182019General Insurance2020Life InsuranceSource: IRCSL Statistical Review - 2020— The insurance penetration level (GWP/ GDP) of Sri Lanka is still relatively low compared to other Asian peers.Relatively low disposable income levels, lower level of awareness of the insurance concept among wider generalpublic, high dependency rates, free healthcare services and micro level community-based welfare systems can beconsidered the key reasons for the lower penetration level. (Source: KPMG Sri Lanka Insurance Report accessible 1.pdf Date of access: 18October 2021)— Insurance penetration has recorded only a marginal growth over the five years to 2020 which has increased to1.4% in 2020 compared to 1.1% in 2015. General insurance penetration has mostly remained

to carry out an independent valuation of LOLC General Insurance Limited ( the "Company") in relation to its proposed Initial Public Offering as per the CSE listing rules 3.1.4 (c). (the "Engagement")'. — KPMG is to undertake a valuation of LGIL as of 31 August 2021 ("Valuation Date"). The valuation analysis is to be