-- A combined index of 99.1% and financial income of R$ 140 million resulted in an 8.9% increase in profits this quarter

RIO DE JANEIRO, Oct. 31, 2012 /PRNewswire/ -- Sul America S.A. (BM&FBovespa: SULA11), the third-biggest Brazil health operator, said third-quarter profit rose, reaching R$ 107 million, 8.9% higher than the third-quarter last year, as the company boosted revenue from premiums. The company ended the third quarter of 2012 with R$ 2.8 billion in premiums, 14.2% more than in the same quarter last year, and a 7.7% growth compared to the second quarter this year.

SulAmerica's premiums increased across all business units, in particular health and dental that grew 18.4%, accounting for 68% of the company's total revenue. Auto insurance and other P&C line premiums increased 4.1% and 15.1% this quarter respectively, while life insurance increased 5.8% over this same period. The company's overall combined index reached 99.1%, 200 basis points better than in the third quarter of 2011.

"Better underwriting and the continuous improvement of our risk management enabled us to deliver solid results and constant growth across all our operations. We believe that the current economic scenario in Brazil, with lower interest rates, will strengthen the domestic economy and allow us to further increase the profitability of our operations, partially offsetting the decline in our financial income. This is why we are committed to continuously improving our operating efficiency, striving to create value for our shareholders" said SulAmerica CEO Thomaz Cabral de Menezes.

The company's financial income this quarter was R$ 140 million, 18.7% below the same quarter in 2011. This drop was expected and is in line with the decline in interest rates since mid-2011. If we compare this quarter with the second quarter of 2012, financial income increased 30.2%, a result of the good performance of our investment portfolio specially our position in equities. Earnings for SulAmerica's Asset Management operation improved 50.3% in 3Q12, driven by increased volume of assets under management and higher revenues from management and performance fees. The proprietary portfolio, not linked to private pension or VGBL, ended the quarter at R$ 4.9 billion.

Highlights by Business Unit

Revenues from our SME (small and medium enterprises) portfolio, within the health and dental segment, inched up 31.7%, compared to 3Q11. Dental insurance premiums increased 10.4%, result of our sales and marketing efforts as well as new product launches.

The automobile and P&C segments showed significant improvements in the loss ratios. Compared to the third quarter of 2011, the loss ratio for auto insurance dropped 270 basis points in the quarter, reaching 65.4%. This is the best level since the start of the year, reversing the uptrend that happened due to the competitive scenario. The loss ratio in the P&C segment, at 36.1% for the quarter, was 1750 basis points below the same period in 2011, reflect of the good performance of the segment's mass insurance and civil liability portfolios.

Credit Life insurance, which already accounts for 14.4% of the premiums for this segment, supported the growth of the Life Insurance segment. The total loss ratio in this portfolio was 49.0%, 880 percentage points better than in the same period in 2011. Pension plan contributions increased 8.5% year-over-year, contributing to a 13.7% increase in private pension and VGBL reserves compared to the same period in 2011.

About SulAmerica

With a history of 116 years, SulAmerica is the largest independent insurance company in Brazil. Since October 2007, when it issued the largest IPO of a Brazilian insurer, it has been listed on BM&F Bovespa's Level 2 differentiated Corporate Governance practices. Between January and September 2012, revenue from premiums reached R$ 7.9 billion, 14.2% more than in the same period last year. With over 6.7 million clients, SulAmerica is active in four different segments: Health and Dental; Auto and P&C; Life Insurance, and Private Pension and Asset Management.

INFORMATION FOR THE PRESS
CDI Comunicacao Corporativa
Juliana Silva – juliana.silva@cdicom.com.br
Cristiane Garcia – cristiane@cdicom.com.br
Nathalia Coutinho – nathalia.coutinho@cdicom.com.br
Telephones: +55 (11) 3817 8005 / 8007 / 8008

SulAmerica – Institutional Communications and Press Relations
Sara Dalsin – sara.dalsin@sulamerica.com.br
Zenaide Peres – zenaide.peres@sulamerica.com.br
Renata Nichols – renata.nichols@sulamerica.com.br
+55 (11) 3779 7615 / 7614
+55 (21) 2506 8512
imprensa@sulamerica.com.br

SOURCE Sul America S.A.