Company: FRFXF
Filing Date: 2025-03-14
Form Type: F-4
Source: 0001104659-25-024010
Chunk: 30

Company: FAIRFAX FINANCIAL HOLDINGS LTD/ CAN
Filing Date: 2025-03-14
Form: F-4
Chunk 30
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 not maintain key employee insurance with respect to any of our employees.

We may be unable to obtain reinsurance coverage at reasonable prices or on terms that adequately protect us.

We use reinsurance arrangements,
including reinsurance of our own reinsurance business purchased from other reinsurers, referred to as retrocessionaires, to help manage
our exposure to property and casualty risks. The availability of reinsurance and rates charged by reinsurers are subject to prevailing
market conditions, both in terms of price and available capacity, which can affect our business volume and profitability. Reinsurance
companies can also add or exclude certain coverages from, or alter terms in, the policies that we purchase from them. Some exclusions
are with respect to risks which we cannot exclude in policies we write due to business or regulatory constraints, such as coverage with
respect to acts of terrorism, mold and cyber risk. Reinsurers may also impose terms, such as lower per occurrence and aggregate limits,
on primary insurers that are inconsistent with corresponding terms in the policies written by these primary insurers. As a result, our
insurance subsidiaries, like other primary insurance companies, increasingly are writing insurance policies which to some extent do not
have the benefit of reinsurance protection. These gaps in reinsurance protection expose us to greater risk and greater potential losses.

The rates charged by reinsurers
and the availability of reinsurance to our subsidiaries will generally reflect our recent loss experience and the industry loss experience
overall. Reinsurance pricing has continued to firm as a result of catastrophe losses in recent years, the threat of sustained high inflation
and its impact on claim costs and the effects of social inflation in the United States and the low interest rate environment. The retrocession
market continues to experience significant rate increases due to increased catastrophe activity in recent years. Each of our insurance
and reinsurance subsidiaries continue to evaluate the relative costs and benefits of accepting more risk on a net basis, reducing exposure
on a direct basis, and paying additional premiums for reinsurance. If we cannot obtain adequate reinsurance protection for the risks we
underwrite, we may be exposed to greater losses from those risks or we may be forced to reduce the amount of business we underwrite, which
will reduce our revenues. As a result, our inability to obtain adequate reinsurance protection could have a material adverse effect on
our financial condition and operations.

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Our operations could be adversely affected as a result of regulatory, political, economic or other influences in the insurance and re