MILLIRE ENG2024

2.25 Outstanding claims reserve Claims are recorded in the year in which they occur, based on reported claims or on the basis of estimates when not reported. Outstanding claims reserve represents the estimate of the total reported costs of notified claims on an individual case basis at the reporting date as well as the corresponding handling costs. In accordance with the “Communiqué on Technical Reserves for Insurance, Reinsurance and Pension Companies and the Related Assets That Should Be Invested Against Those Technical Reserves” (“Communiqué on Technical Reserves”) which was issued in 27655 numbered and July 28, 2010 dated Official Gazette according to the Communiqué on Technical Reserves, all expenses related to the claim files including calculated or expected expertise, consultant, lawsuit and communication expenses in the calculation of outstanding claims reserve. In these calculations salvage and subrogation income are not considered. Except for the life branch, outstanding claims reserve consists of claims are recorded in the year in which they occur, based on reported claims and the difference between the result of the actuarial chain ladder method whose content and application criteria stated by Turkish Insurance and Private Pension Regulation and Supervision Authority, and reported but not settled claims are considered as incurred but not reported (“IBNR”) claims. Actuarial chain ladder method may be differentiated by Turkish Insurance and Private Pension Regulation and Supervision Authority for reinsurance companies due to their special conditions. December 5, 2014 dated “Circular regarding Outstanding Claims Reserve (2014/16)” and 2010/12 numbered “Circular regarding actuarial chain ladder method” is abolished except Article 9 and 10. According to circular that explains ACLM measurement method, insurance and reinsurance companies calculate ACLM with six different methods as “Standard Chain, Damage/Premium, Cape Cod, Frequency/Intense, Munich Chain and Bornhuetter-Ferguson”. As of December 31, 2024, excluding the Singapore branch, the Company has added 2,763,615,993 TRY to its financial statements as a provision for outstanding claims, by considering 100% of the IBNR calculated. (December 31, 2023: 651,285,087 TRY). As of the reporting date, a net IBNR of 192,258,576 TRY (December 31, 2023: 115,375,539 TRY) has been allocated for the Singapore Branch. The amounts of incurred but not reported c (“IBNR”) allocated by the Company on a branch basis and the IBNR calculation methods it has chosen are given in the table below: Milli Reasürans December 31, 2024 December 31, 2023 Branches Calculation Method Net IBNR (*) Net IBNR (*) General Liabilities (***) ACLM- Paid Claims 860.809.044 294.434.236 General Losses (**) ACLM - Paid Claims 820.698.727 316.094.872 Fire and Natural Disasters ACLM - Paid Claims 748.210.321 222.030 Land Vehicles Liabilities ACLM - Paid Claims 365.686.798 117.072.338 Financial Losses ACLM - Paid Claims 60.288.286 46.519.250 Other branches, total ACLM - Paid Claims (93.855.107) (127.843.946) Other branches, total Sector Average (TSB) 1.777.924 4.786.307 Total 2.763.615.993 651.285.087 (*) Excludes amounts allocated for the Singapore branch. (**) Two separate calculation have been made as agriculture and non-agriculture subbranches. (***) In accordance with the “Circular numbered 2020/11 on Making Amendments on Communique regarding Provision for Outstanding Claim Files numbered 2014/16”, an additional calculation is made in terms of Compulsory Financial Liability Insurance regarding Medical Malpractice sub-branch and calculation is made in terms of other sub-branches under General Liability through excluding Compulsory Financial Liability Insurance regarding Medical Malpractice. 126 Millî Reasürans Türk Anonim Şirketi (Currency: Turkish Lira (TL)) Notes to the Unconsolidated Financial Statements As of December 31, 2024 (Convenience Translation of Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) MİLLİ RE