Milli Re 2025 Annual Report

For Türkiye, 2025 was characterized as a year of continued endeavors to maintain the balance between growth and stability under tight financial conditions. losses were limited to USD 129 billion demonstrated the coverage gap, providing critical data for the long- term roadmap. Deceleration of global climate action efforts and delays in the area of sustainability needs to be monitored closely due to their upward pressure on economic risks and insurance risks. Integration of climate risks in corporate strategies remains critical. Our sector continues to write its growth story For Türkiye, 2025 was characterized as a year of continued endeavors to maintain the balance between growth and stability under tight financial conditions. The downtrend in inflation and the predictable course of exchange rate movements, coupled with the continued support investment income extended to technical profitability, offered a healthier ground for the sector, while economic activity and employment remained significant from the standpoint of premium production and the breadth of the risk pool. According to year-end 2025 data from the Insurance Association of Türkiye, total premium production of the Turkish insurance sector reached TL 1,223 billion in 2025, its highest- ever corresponding to a nominal growth of 45.8% and a real growth of 11.4%. Non-Life branches generated TL 1,044 billion in premiums, which constituted 85.4% of the overall sector’s premiums; with premiums amounting to TL 178.9 billion, the Life branch increased its share from 11.9% to 14.6%. While Land Vehicles Liability branch insurance retained its leadership in the Non-Life segment with a 29.7% share, decoupling was most evident in health insurance: the health branch, which has become the second largest branch with a market share of 20.3%, has seen the clearest demand-driven expansion with a real growth by 18.5%. Fire and Natural Disasters and Land Vehicles/ Own Damage got 15.9% and 14.1% share from total Non-Life production, respectively. Save for agricultural insurance, catastrophe losses in 2025 did not achieve a burdensome magnitude for the sector and the economy in Türkiye. The prices adopted a downtrend owing to intensified competition following the market hardening between 2023 and 2024. By the time of the 2026 renewals, demand for capacity increased, with reinsurer appetite further exceeding it. Despite the ongoing risk of a possible Marmara earthquake, natural disaster and climate risks and model uncertainties, excess of loss treaties were renewed at prices lower than those projected. At Milli Re, we made the necessary adjustments in 2026 renewals to eliminate concentration risk within our proportional treaty portfolios while integrating lucrative, low-risk business, in line with our approach designed to protect the competitiveness of the companies we provide with capacity. Most companies in Türkiye continued to protect their portfolios in 2026 through proportional bouquet treaties. While there were no major transitions from proportional to non-proportional business in renewals, a limited number of companies shifted from excess of loss protection to proportional treaties in 2026. Proportional treaties were renewed with overplacements of up to 30%—a level not seen in years. We believe that reputable new reinsurers’ interest in proportional treaties and their participation in these placements directly reflect the effective post-February 6 earthquake measures and successful proactive claims management. GENERAL INFORMATION FINANCIAL RIGHTS PROVIDED TO THE 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 17