Company: FRFXF
Filing Date: 2025-10-09
Form Type: F-10/A
Source: 0001104659-25-098335
Chunk: 45

Company: FAIRFAX FINANCIAL HOLDINGS LTD/ CAN
Filing Date: 2025-10-09
Form: F-10/A
Chunk 45
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 We may also conduct business through third parties such as managing general agents where it is

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TABLE OF CONTENTS

cost effective to do so and where we can control the underwriting process to ensure our risk management criteria are met. Each of these channels has its own distinct distribution characteristics and customers. A large majority of our business is generated by brokers (including international reinsurance brokers with respect to the Company’s reinsurance operations), with the remainder split among the other distribution channels. This is substantially consistent across our insurance and reinsurance subsidiaries.

Our insurance operations have relationships with many different types of brokers including independent retail brokers, wholesale brokers and national brokers depending on the particular jurisdiction, while our reinsurance operations are dependent primarily on a limited number of international reinsurance brokers. We transact business with these brokers on a non-exclusive basis. These independent brokers also transact the business of our competitors and there can be no assurance as to their continuing commitment to distribute our insurance and reinsurance products. Our continued profitability depends, in part, on the marketing efforts of independent brokers and our ability to offer insurance and reinsurance products and maintain financial ratings that meet the requirements and preferences of such brokers and their policyholders.

Because the majority of our brokers are independent, there is limited ability to exercise control over them. In the event that an independent broker exceeds its authority by binding us on a risk that does not comply with our underwriting guidelines, we may be at risk for that policy until the application is received and a cancellation effected. Although to date we have not experienced a material loss from improper use of binding authority by our brokers, any improper use of such authority may result in losses that could have a material adverse effect on our business, financial condition, profitability or cash flows. Our insurance and reinsurance subsidiaries closely manage and monitor broker relationships and regularly audit broker compliance with our established underwriting guidelines.

### Financial reporting risks associated with IFRS 17.
IFRS 17 Insurance Contracts (“

#### IFRS 17
”) as issued by the International Accounting Standards Board (“

#### IASB
”) was retrospectively adopted by the Company on January 1, 2023 with restated comparative periods presented in the financial statements. IFRS 17 replaced IFRS 4 Insurance Contracts and introduced considerable change and additional complexity to the recognition, measurement, presentation and disclosure of insurance contracts within the Company’s consolidated financial statements. The complex measurement requirements of IFRS 17 increased the potential volatility in the Company’s consolidated