Milli Re 2025 Annual Report

From the standpoint of the Turkish insurance market, 2025 has been a year of softening for the tough market conditions that were shaped in the aftermath of the earthquakes of 6 February 2023 and intensifying competition. The capacity contraction observed in 2023 and 2024, rising reinsurance costs, and selective underwriting practices were replaced by a growing reinsurance capacity, increasing risk appetite and price competition in 2025. The Turkish insurance market sustained its nominal growth, whereas real growth was measured at 11%. Non-life insurance segment kept acting as the main driver of total premium production. While the growth in non-life branches stemmed largely from the increased insurance prices, coverage and limit updates and price adjustments, some branches achieved limited real growth, while some others suffered contraction. In the life branch, on the other hand, increased savings awareness, the effectiveness of the bancassurance channel, and updates to product prices have been the main factors that supported growth. According to year-end data released by the Insurance Association of Türkiye, the Turkish insurance industry produced TL 1,223 billion in premiums in 2025, representing a 45.8% increase over 2024. Adjusted for inflation, this nominal growth corresponds to a real growth by 11.4%. Non-Life branches accounted for 85.4% of total premiums written by the industry in 2025, translating into a nominal premium growth of 41.3%, amounting to TL 1,044 billion in 2025. The Life insurance branch recorded a nominal growth of 79.1%, and the share of this branch within total Life and Non-Life premiums was recorded as 14.6%. While Land Vehicles Liability insurance, the primary driver of premium production in the sector, recorded a nominal growth of 41.2% in premium income, corresponding to a real increase of 7.8%, the share of the branch in total Non-Life premiums was registered as 29.7%. The rise in premium production stemmed largely from the arrangements made to the tariff and coverage limits; notwithstanding, increased loss frequency and severity caused the pressure on technical results to persist also in 2025. In the Land Vehicles branch, where premiums are set under a free tariff system and the loss ratio plays a significant role in determining prices, the rising vehicle values, spares and labor costs elevated premium levels, while cost- sensitivity on the part of consumers and competitive campaigns repressed pricing. With an annual nominal growth of 31.1%, real growth was restrained by intense competition and price sensitivity, which was registered as a marginal 0.1%. The share of the branch in total Non-Life premium production was recorded as 14.1%. Health branch has been one of the segments that achieved real growth in 2025. The surged healthcare service costs, stronger demand in complementary health insurance and the expansion in corporate health portfolios supported the growth of this branch. Premiums written in health branch augmented by 55.1% in 2025 corresponding a growth by 18.5% in real terms, increasing the share of this branch within Non-Life Turkish Insurance Market The Turkish insurance market sustained its nominal growth, whereas real growth was measured at 11%. 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 59