MILLIRE ENG2024

Effects of the changes in assumptions used in the measurement of insurance assets and liabilities showing the effect of each change separately that has significant effect on financial statements In the current year, there are no material changes in the assumptions of measurement of insurance assets and liabilities. 4.2 Management of financial risk Introduction and overview This note presents information about the Company’s exposure to each of the below risks, the Company’s objectives, policies and processes for measuring and managing risk, and the Company’s management of capital. The Company has exposure to the following risks from its use of financial instruments: - credit risk - liquidity risk - market risk The Company may be exposed to Credit Risk (counterparty risk, counterparty concentration risk), Market Risk (currency and parity risk, interest rate risk, equity position risk, off-balance sheet risk, financial instrument concentration risk), and Liquidity Risk (liquidity risk related to funding, market, and concentration) depending on the level and nature of its assets at any given time. The Company’s exposure to each of the above risks is assessed according to “Application Principles in Respect of Risk Limits”. The Company monitors its receivables by obtaining comprehensive information about the debtors and debtors’ activities. The risk over investment portfolio is managed by measuring and reporting the market risk daily, reassessing the results validity and applying different scenario analyses. The Company’s exposure to each of the above risks is measured by Risk Management Service independently, reported to Board of Directors and units of Türkiye İş Bankası A.Ş. through the Risk Committee. Credit risk Credit risk is the risk of financial loss to the Company if counterparties (parties issued financial instrument, insurance companies, reinsurance companies and other debtors) having business relationship with the Company fails to meet its contractual obligations. The Company manages this credit risk by regularly assessing reliability of the counterparties. In measuring Credit Risk, both quantitative and qualitative methods are used together. As part of managing the credit risk related to the investment portfolio, the credit ratings of the issuers of securities and the transaction limits set to prevent concentration of counterparties are regularly monitored. The results evaluated by the Risk Management Service and reported regularly to the Board of Directors through the Risk Committee. Action plan is determined by the Board of Directors in the case of having exposure higher than acceptable level of risk and probability. Net book value of the assets that is exposed to credit risk is shown in the table below. December 31, 2024 December 31, 2023 Cash and cash equivalents (Note 14) 4.383.823.465 1.825.305.969 Financial assets and financial investments with risks on policyholders (Note 11) (*) 4.413.356.379 4.025.665.429 Receivables from main operations (Note 12) 2.866.435.125 4.088.255.641 Reinsurer share in outstanding claims reserve (Note 10), (Note 17) 1.729.970.615 5.807.404.091 Prepaid taxes and funds (Note 12) 71.260.270 9.170.386 Income accruals 323.144.436 64.668.644 Other Prepaid Expenses (**) 74.552.621 69.776.254 Other receivables (Note 12) 235.542.408 37.011.346 Business advances and advances given to employees (Note 12) 702.865 47.448 Total 14.098.788.184 15.927.305.208 (*) Equity shares amounting to TL 885.467.625 are not included (December 31, 2023: TL 424.271.505) (**) TL 63.786.584 is the advance amount given by the Company. (December 31, 2023: TL 62.292.330). 135 2024 Annual Report 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) GENERAL INFORMATION FINANCIAL RIGHTS PROVIDEDTOTHE MEMBERS OF THE GOVERNING BODY AND SENIOR EXECUTIVES RISKS AND ASSESSMENT OF THE GOVERNING BODY ACTIVITIES AND MAJOR DEVELOPMENTS RELATED TO ACTIVITIES RESEARCH & DEVELOPMENT ACTIVITIES FINANCIAL STATUS FINANCIAL INFORMATION