MILLIRE 2021 ANNUAL REPORT

NOTES TO THE UNCONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2021 Millî Reasürans Türk Anonim Şirketi (Convenience Translation of Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish, See Note 2.1.1) (Currency: Turkish Lira (TL)) Profit for the period that is extraneous from the distribution In accordance with tax legislation, 75% of profits from sales of participation shares and 50% of profit from real states included in the assets of companies is exempt from corporate tax provided that it is classified under a special fund for full five years. The exempt gains cannot be transferred to another account other than a capital increase or cannot be withdrawn from the entity for five years. In the direction of sector announcement made by Treasury dated October 27, 2008 and numbered 2008/41, the Company classified the gain on sale dated April 10, 2015 from the land in real estate amounting to TL 23.723.323 as of December 31, 2016. As of December 31, 2021, profit for the period that is extraneous from the distribution that are accounted according to the equity method amounting to TL 844.463 (December 31, 2020: TL 707.397). As of December 31, 2021, TL 162.083, which corresponds to 75% of the income obtained from the sale of the subsidiary realized by the Company as of December 14, 2020, has been classified in the Non-Distributable Period Profit. The Non-Distributable Period Profit amount accounted for using the equity method is TL 162.083. (December 31 2020: 583.131) 16 Other reserves and equity component of discretionary participation As of December 31, 2021, and 2020, other reserves are explained in detail in Note 15 - Equity above. As of December 31, 2021, and 2020, the Company does not hold any insurance or investment contracts which contain a discretionary participation feature. 17 Insurance contract liabilities and reinsurance assets Estimation of the ultimate payment for the outstanding claims is one of the most important accounting assumptions of the Company. Estimation of the insurance contract liabilities contains several ambiguities by nature. The Company makes calculation of the related insurance technical provisions accordance with the Insurance Legislation and reflects them into financial statements as mentioned in Note 2 - Summary of significant accounting policies . As of December 31, 2021, and 2020, technical reserves of the Company are as follows: December 31, 2021 December 31, 2020 Unearned premiums reserve, gross 1.187.333.155 840.067.426 Unearned premiums reserve, ceded (Note 10) (23.649.245) (20.130.822) Unearned premiums reserve, net 1.163.683.910 819.936.604 Outstanding claims reserve, gross 2.375.596.576 1.710.325.122 Outstanding claims reserve, ceded (Note 4.2) (106.787.271) (78.871.381) Outstanding claims reserve, net 2.268.809.305 1.631.453.741 Unexpired risks reserve, gross 158.300.804 48.745.980 Unexpired risks reserve, ceded (Note 10) (2.455.087) (597.586) Unexpired risks reserve, net 155.845.717 48.148.394 Equalization reserve, net 245.855.051 184.672.350 Mathematical reserves - 13.014 Total technical reserves, net 3.834.193.983 2.684.224.103 Short-term 3.588.338.932 2.499.551.753 Medium and long-term 245.855.051 184.672.350 Total technical reserves, net 3.834.193.983 2.684.224.103 147 MİLLÎ REASÜRANS ANNUAL REPORT 2021 FINANCIAL STATUS RISKS AND ASSESSMENT OF THE GOVERNING BODY UNCONSOLIDATED FINANCIAL STATEMENTS TOGETHER WITH INDEPENDENT AUDITORS’ REPORT THEREON CONSOLIDATED FINANCIAL STATEMENTS TOGETHER WITH INDEPENDENT AUDITORS’ REPORT THEREON