MILLI RE 2023 ANNUAL REPORT

highly effectively fulfilled their responsibility in this challenging process by way of fast claims payments, also with the help of the support extended by strong local and international reinsurance panels. With the aim of alleviating the potential hardships for the insurance industry by making significant contributions to compensating the losses caused by the earthquake, Milli Re took action swiftly in keeping with its market leader responsibility, and started making its payments for the earthquake. While total earthquake claims paid amounted to approximately EUR 322 million as of year-end 2023, the Company’s total ultimate claims paid is anticipated to reach the order of EUR 550 million in view of outstanding claims. Total estimated cost of Kahramanmaraş Earthquake to our company will be approximately EUR 43 million. As stricter prices and conditions persist in treaties, sufficient reinsurance capacity is available to fulfill the demand. The amount of worldwide total economic losses caused by catastrophes rose to USD 380 billion in 2023. Global insured cat losses are estimated to have surpassed the USD 100 billion mark for the fourth consecutive time in 2023. This portrait also demonstrates the low level of global insurance ownership. In line with the considerable price increases and structural changes that dominated the reinsurance markets in 2023, January 2024 renewals were relatively more moderate amid the new market dynamics that were generated during the reporting period. Although existing price levels might be restrictive for ceding companies, reinsurance demand remained strong with the effect of the pressure the ongoing inflationist environment put on insurance costs. As total reinsurance capacity shrank in 2023, supply was at sufficient level to respond to the demand in January 2024 renewals as a result of the improvement in treaty terms and the adequate level reached in prices. Despite the big-ticket cat losses that occurred although they were not in high amounts individually, reinsurers attained improved technical results with the support of the significantly stricter renewal prices and terms for 2023. Owing to the recovery in investment income, total reinsurance capital including alternative capital went up from USD 590 billion at year-end 2022 to USD 635 billion in September 2023. From the standpoint of our country, the damages caused by the earthquake of February 6 th and growing capacity needs further escalated the reinsurance costs that have been climbing up for the past two years. Some companies that had difficulties in their 2024 reinsurance renewals were able to complete their placements by creating a hybrid model involving alternative reinsurance treaties. In 2023, both proportional and non-proportional reinsurance treaties were placed at later dates than envisaged. We are endorsing our effectiveness and leadership in the market under any circumstance. Our company allocates a significant extent of reinsurance capacity to the insurance industry thanks to its high market share, its leadership in proportional treaties, technical experience and knowledge. As Milli Re, we carry on with our activities focused on establishing the necessary infrastructure and business acceptance discipline, optimizing the reinsurance structures of insurers or risks, supporting our industry in every sense, and creating strong cooperation with the aim of ensuring the sustainability of profitability and coverages in the industry. In 2023, rules were put in place for pursuance of a more disciplined business writing policy that highlights technical perspective and profitability in the terms and business writing of the reinsurance capacity provided to the local market, which helped our company lead the sector on one hand, and reinforce international reinsurers’ trust in Mille Re on the other. Although our company went through a challenging renewal process, it also facilitated capacity allocation to the Turkish market. The earthquake affected our 2024 renewals cost-wise; yet, it did not pose an obstacle to the success of the process, and a successful placement was made once again in 2024 to our extremely strong, internationally- respected retrocession panel that has high credit ratings. OUR COMPANY ALLOCATES A SIGNIFICANT EXTENT OF REINSURANCE CAPACITY TO THE INSURANCE INDUSTRY THANKS TO ITS HIGH MARKET SHARE, ITS LEADERSHIP IN PROPORTIONAL TREATIES, TECHNICAL EXPERIENCE AND KNOWLEDGE. GENERAL INFORMATION FINANCIAL RIGHTS PROVIDEDTOTHE MEMBERS OF THE GOVERNING BODY AND SENIOR EXECUTIVES ACTIVITIES AND MAJOR DEVELOPMENTS RELATED TO ACTIVITIES RESEARCH & DEVELOPMENT ACTIVITIES FINANCIAL STATUS FINANCIAL INFORMATION 13 2023 Annual Report RISKS AND ASSESSMENT OF THE GOVERNING BODY