MILLIRE 2021 ANNUAL REPORT

ACTIVITIES AND MAJOR DEVELOPMENTS RELATED TO ACTIVITIES GENERAL INFORMATION FINANCIAL RIGHTS PROVIDED TO THE MEMBERS OF THE GOVERNING BODY AND SENIOR EXECUTIVES RESEARCH & DEVELOPMENT ACTIVITIES 52 MİLLİ RE ANNUAL REPORT 2021 GLOBAL REINSURANCE MARKET AND MİLLİ RE Showing an increase of 33% on annual basis, total economic losses from natural catastrophes reached USD 280 billion in 2021. Surpassing last year’s figure of USD 82 billion, global insured losses went up to USD 120 billion, making it the second costliest year on record for the industry after 2017. As climate change has led to extreme weather events across the world, majority of the losses were caused by secondary perils such as flood, wildfire, winter weather and severe weather conditions. While a great portion of the natural disaster losses was recorded in US; only 43% of the global losses were insured; pointing out to the fact that insurance density remains to be relatively low for secondary perils even in developed countries. Following 2020, 2021 witnessed another extremely active Atlantic Hurricane season with record breaking number of events. With 21 named storms, of which 8 made landfall in the continental US and 7 developed into hurricanes, 2021 Atlantic Hurricane season was the third most active year in record after 2020 and 2005. Originating as a tropical wave in the Caribbean Sea on August 23 rd , and making its landfall near Port Fourchon, Louisiana on August 29 th as a Category 4 storm with sustained windspeed of 240 km/h, Hurricane Ida was the strongest and the costliest of 2021 Atlantic Hurricane season. Being the second most intense hurricane impacting Louisiana after Hurricane Katrina in 2005, Ida caused extensive damage across the Gulf Coast with strong winds, storm surges, and inland floods. After devastating Southeast US, Ida weakened into a tropical storm and moved across northeast. Bringing along torrential rainfalls, it triggered exceptional flash floods in the Northeastern states of New York, New Jersey, Connecticut, and Pennsylvania. While Hurricane Ida was recorded as the costliest natural catastrophe of 2021, the total economic cost of the disaster is estimated to exceed USD 65 billion. Including the losses covered by the US National Flood Insurance Program (NFIP), around USD 32 billion of this amount is expected to be recoverable from the insurance industry. On the other hand, the winter storm which stroke North America and recorded as the second costliest natural disaster affecting the country in 2021, generated extreme cold temperatures and gave rise to unprecedented winter weather conditions during February 12 th to 20 th . Mainly impacting Texas and southern states; the snow, ice and severe storms caused extensive property damage, power outages and transportation disruption across the country. The disaster is projected to have caused a total of USD 30 billion economic loss, with insured losses amounting to USD 15 billion. 2021 was quite challenging for Europe as well in terms of natural catastrophe activity. Severe and deadly floods induced by torrential rainfalls that came along with the low-pressure system Bernd devastated mainly Germany, Belgium, the Netherlands, Luxembourg, and France during July 12 th - 18 th . The European floods stood out as the costliest disaster affecting the region since 1970 as well as being the most expensive event of 2021 for the insurance industry that occurred outside of the US. While the total economic cost of the floods is expected to exceed USD 50 billion, insured losses are estimated to be around USD 13 billion. Apart from the deadly floods, severe weather conditions which prevailed in Western and Central Europe during the second half of June was another major event driving high amount of industry losses. While Czech Republic, Germany, Switzerland, Austria, and Belgium were the most affected countries; heavy rain, hail and tornadoes led to widespread property damage in the region. The disaster is anticipated to lead to a bill of over USD 4.5 billion for the insurance market. Severely impacted by a series of devastating catastrophe events in 2020, Asia witnessed unprecedented natural disasters in 2021 as well. The magnitude 7.1 earthquake which stroke the coast of Japan’s Fukushima Prefecture on February 13 th stood out among the most significant natural disasters impacting the region. The catastrophe caused destruction of or damage in around 5,000 residential buildings that is estimated to bring along economic losses exceeding USD 8 billion and insured loss amount of over USD 2.5 billion. 33% Showing an increase of 33% on annual basis, total economic losses from natural catastrophes reached USD 280 billion in 2021.