MILLIRE_2019_Annual Report

Milli Re Annual Report 2019 130 Millî Reasürans Türk Anonim Şirketi NOTES TO THE UNCONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2019 (Currency: Turkish Lira (TL)) (Convenience Translation of Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish, See Note 2.1.1) Reinsurance risk is monitored regularly according to criteria described in the “Limit over Acceptable Reinsurance Risk and Maximum Custody Share Limit” policy and results are analysed by the Risk Committee and reported to the Board of Directors. Action plan is determined by the Board of Directors in the case of having exposure higher than acceptable level of risk and probability. Sensitivity to insurance risk Insurance risks do not generally have significant unrecoverable losses in the course of ordinary transactions, except for risks associated with earthquake and other catastrophic risks. Therefore, there is a high sensitivity to earthquake and catastrophic risks. The case of potential claims’ arising from earthquake and other catastrophic risks exceeding the maximum limit of the excess of loss agreements, such risks are treated as the primary insurance risks and are managed based on the precautionary principle. Maximum limit of excess of loss agreements is determined based on the worst case scenario on the possibility of an earthquake in terms of its severity and any potential losses incurred in accordance with the generally accepted international earthquake models. Insurance risk concentrations The Company’s gross and net insurance risk concentrations (net of reinsurer share) in terms of insurance branches are summarized as below: December 31, 2019 Branches Gross total claims liability (*) Reinsurance share of total claims liability Net total claims liability Fire and natural disasters 515.769.646 (28.001.107) 487.768.539 General Damages 250.668.378 (819.163) 249.849.215 Land vehicles liability (MTPL) 47.830.299 (24.164) 47.806.135 General liabilities 40.743.871 (1.339.151) 39.404.720 Sea Vehicles 33.198.281 (3.479.788) 29.718.493 Marine 22.903.942 (2.345.008) 20.558.934 Land vehicles 30.864.346 (816.525) 30.047.821 Casualty 11.620.156 (348.799) 11.271.357 Life 6.307.867 (882.208) 5.425.659 Health 14.472.059 - 14.472.059 Fidelity Guarantees 559.095 (2.269) 556.826 Financial losses 11.159.910 - 11.159.910 Air Vehicless 414.714 - 414.714 Credit 168.772 - 168.772 Legal protection 557 - 557 Total 986.681.893 (38.058.182) 948.623.713