QBE INSURANCE GROUP LIMITED

AUDIT COMMITTEE CHARTER

Nature of committee: Audit Committee

Owner: Company Secretary
Approval: Board
Approval date: 14 August 2019
Status: Final
Audit Committee Charter

1. Introduction

The Audit Committee (“Committee”) is established by the Board of Directors (“Board”) of QBE
Insurance Group Limited (“Company”).

2. Role

The role of the Committee is to assist the Board in overseeing the effectiveness of the Company’s
and the consolidated Group’s financial reporting and risk management framework. In particular,
the Committee will oversee and monitor the integrity of the Group’s financial reporting, including:

 financial reporting to regulators and shareholders;

 financial reporting risks;
 accounting policies, practices and disclosures;
 the scope and outcome of external and internal audits;
 the financial control environment;
 the scope of the external actuarial review; and
 the adequacy and independence of the internal and external audit functions.

It is not intended that the Committee should assume any of management’s responsibilities in these
areas.

3. Composition

The Committee will be comprised of a minimum of three members as determined by the Board.
All members must be non-executive directors. A majority of the members of the Committee must
be independent.

No alternates will be permitted unless agreed by the Committee Chairman at a meeting of the
Committee.

The Chairman of the Committee will be appointed by the Board and must be an independent non-
executive director who is not the Chairman of the Board.

A Company Secretary of the Board will act as Secretary to the Committee.

The composition of the Committee is to be reviewed at least annually as part of the Board
performance assessment.

The Committee members between them must have accounting and financial expertise and
qualifications and have a sufficient understanding of the business of the Group and the markets
in which it operates.

4. Authority

The Committee has the authority as delegated within this Charter to:

 investigate any activity falling within the scope of this Charter;

 obtain all information necessary for the performance of the Committee’s role as set out in this
Charter;
 access the Group Chief Executive Officer (“CEO”), Group Chief Financial Officer (“CFO”),
Group Head of Internal Audit, Group Chief Actuary, executives and other employees, and any
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Audit Committee Charter

external parties including the external auditor as required for the performance of the
Committee’s role as set out in this Charter, including to seek additional information and
explanation during its meetings;
 appoint specialist independent third-party advisers or legal, accounting, actuarial or other
consultants to independently advise the Committee; and
 attend relevant external training courses after consent from the Chairman of the Company
and in accordance with the Non-Executive Director Continuing Development Program.

5. Scope

The Committee is responsible for:

Financial reporting
 overseeing compliance with applicable financial reporting, regulatory and professional
accounting requirements;
 reviewing, assessing and recommending to the Board for approval the annual and half-year
financial statements and other financial statements as applicable, including any disclosures,
commentary and notes;
 reviewing, assessing and recommending to the Board for approval the annual regulatory
returns;
 reviewing, assessing and recommending to the Board for approval the full-year and half-year
insurance liabilities and associated risk margins;
 reviewing and assessing, as applicable, the Group’s:
 external auditor’s reports;
 Group Chief Actuary’s reports; and
 declarations to be made by directors, CEO and CFO.
 discussing with management and the external auditor significant financial and other reporting
issues, judgements and findings made in connection with the preparation of the above noted
reports and considering the adequacy of management’s responses;
 recommending areas of significant accounting judgement to the Board for approval;
 discussing with management and the external auditor judgements on the quality and
appropriateness of accounting principles applied by the Company in financial reporting, and
accounting policy treatment;
 reviewing and assessing information from internal auditors that may relate to the quality of the
financial reports;
 discussing with management and the external auditor any major financial risk exposures and
the steps management has taken to monitor and control such exposures;
 discussing with management and the external auditor any major issues as to the adequacy
of the internal controls and any actions taken to address material control deficiencies in
relation to financial reporting and regulatory compliance;
 reviewing with management and the external auditor the effect of regulatory and accounting
changes and assessing their impact on financial reports;
 reviewing the impact of, or any major suggested changes to, auditing and accounting
principles and practices and the methods or judgements used to account for significant or
unusual transactions where different approaches are possible;
 approving audit-related policies and guidelines (not otherwise reserved for the Board or other
Board Committees or not falling within the scope of management approval);
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Audit Committee Charter

 reviewing and recommending to the Board for approval finance policies as appropriate, e.g.
Group Tax Risk Policy.
External audit
 reviewing the qualifications and experience of the external auditor and considering the
independence (at least annually) and any potential conflicts of interest of the external auditor
in the context of any policies issued by the Group and relevant regulatory requirements;
 monitoring the performance of the external auditor and overseeing the relationship with the
external auditor;
 endorsing and recommending to the Board the appointment, reappointment or removal of the
external auditor for shareholder approval;
 if the Committee's recommendation to remove the external auditor from their position is
agreed by the Board, the Committee must discuss the reasons for the external auditor's
removal with relevant regulators no later than 10 business days after the Board agrees with
that recommendation;
 reviewing the scope of the external audit plan to ensure1 that it covers all material risks and
relevant financial reporting and other regulatory requirements, and reviewing the terms of
engagement letter and fees for services provided;
 recommending to the Board for approval the external audit plan;
 recommending to the Board for approval the remuneration of the external auditor;
 recommending to the Board for approval the rotation of the audit engagement partner;
 reviewing the findings of the audits and ensuring that identified issues are being managed
and rectified in an appropriate and timely manner;
 discussing with the external auditor matters relating to the conduct of the audit, including any
difficulties encountered in the course of the audit work, any restrictions on scope of activities
or access to requested information and any significant disagreements with management;
 monitoring the provision of non-audit services by the external auditor in the context of the
QBE Group policy on the provision of non-audit services;
 periodically consulting with the external auditor without the presence of management;
Internal audit
 reviewing the qualifications, experience, resources, and independence of the internal audit
function and assessing whether the internal audit function has the necessary authority,
capability and resource to conduct its role in an effective and objective manner;
 reviewing the scope of the internal audit plan to ensure that it covers all material risks and
relevant financial reporting and other regulatory requirements and monitoring performance of
the internal audit function against the plan;
 reviewing the findings of the audits and ensuring that identified issues are being managed
and rectified in an appropriate and timely manner, including by having management
accountable for internal audit issues providing updates to the Committee;
 monitoring the provision of non-audit services by the internal audit function;
 periodically consulting with the internal auditors without the presence of management;
 confirming that the internal audit function is operating within the framework of the QBE Group

1 All references to the term “ensure” within this document are to be interpreted as taking all reasonable steps and
making all appropriate enquiries so that the Board or Committee can determine, to the best of its knowledge, that the
stated matter has been properly addressed.

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Audit Committee Charter

Internal Audit Charter as appropriate;

 endorsing and recommending to the Board for approval the appointment or termination of the
Group Head of Internal Audit;
 if the Committee's recommendation to remove the Group Head of Internal Audit from their
position is agreed by the Board, the Committee must discuss the reasons for the Group Head
of Internal Audit's removal with relevant regulators no later than 10 business days after the
Board agrees with that recommendation;
Group Chief Actuary
 reviewing the qualifications and experience of the Group Chief Actuary and considering the
independence and any potential conflicts of interest of the Group Chief Actuary in the context
of any QBE Group and relevant regulatory requirements;
 endorsing and recommending to the Board for approval the appointment or termination of the
Group Chief Actuary;
 monitoring the performance of the Group Chief Actuary;
 considering the advice of the Group Chief Actuary with regards to the suitability of the Group’s
Actuarial Advice Framework;
 reviewing, assessing and recommending the Group’s Actuarial Advice Framework to the
Board for approval;
 periodically consulting with the Group Chief Actuary without the presence of management;
Compliance with financial reporting and tax laws and regulations
 reviewing the effectiveness of the Group’s systems, policies and processes for monitoring
compliance with financial reporting and tax laws, regulations and other requirements and
taking reasonable steps to confirm that actions are in place to address any identified issues or
non-compliance;
 considering the extent to which regulatory compliance matters have been taken into account
in the preparation of financial statements;
Internal control
 reviewing the effectiveness of the Group’s internal financial controls and processes;
 reviewing the effectiveness of the Group’s processes for preventing and detecting financial
crime such as fraud, bribery and corruption;
Whistleblowing
 ensuring that the Group has in place policies and procedures for employees to confidentially
submit information about accounting, internal control, compliance, audit and other matters
about which the employee has concerns. The Committee must also ensure that the Group
has a process for ensuring employees are aware of these policies and for dealing with matters
raised by employees under these policies; and
 reviewing reports on material incidents under those policies and procedures.;
Other
 recommending amendments to this Charter to the Board for approval.

The Committee may deal with the above matters as required.

The Committee will arrange for effective coordination with other committees on matters which also
relate to their responsibilities.

Management is responsible for preparing and presenting to the Committee regular reports and
other information on all matters about which the Committee should be informed. Management will
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Audit Committee Charter

also escalate in a timely manner new or heightened risks for consideration by the Committee.

6. Meetings

The Committee will meet at least four times a year and more frequently as required. Meetings are
to be scheduled such that they are generally held prior to the meetings of the Board of the
Company. Any Committee member or the Secretary may call a meeting.

A quorum for meetings will be two Committee members, including the Chairman. Decisions will be
made by a majority of directors present and voting.

All non-executive directors of the Board have a standing invitation to attend each meeting.

The external auditor, the Group Chief Actuary and Group Head of Internal Audit have a standing
invitation to all meetings of the Committee. The CEO, CFO and Group Chief Risk Officer of the
Company will each have a standing invitation to attend each meeting, subject to exclusion at the
discretion of the Committee Chairman, as may be necessary from time to time. The Committee
may invite executives, senior management or other persons as required from time to time.

A notice of each meeting confirming the date, time, venue and agenda will be forwarded to each
member of the Committee prior to the date of the next meeting. The notice for members will include
relevant supporting documentation for agenda items to be discussed.

7. Reporting

The Secretary will prepare and circulate minutes of meetings of the Committee to all Committee
members within a reasonable time after each meeting.

The Chairman will report to the Board as appropriate on matters reviewed and/or recommended
and/or approved by the Committee and any other areas within the Committee’s scope. All directors
of the Board of the Company will receive a copy of the minutes of the Committee meetings and
may request a copy of its papers.

8. Access

The members of the Committee must be available upon reasonable notice to meet with relevant
regulators if requested to do so.

Senior management, the heads of all risk management functions, the General Counsel, the
external auditor, Group Head of Internal Audit and Group Chief Actuary have free and unfettered
access to the Committee and vice-versa.

The Group Head of Internal Audit has a reporting line and unfettered access to the Committee.

9. Review

The Committee will review this Charter every two years and recommend any proposed
amendments to the Board for approval.