Milli Re 2025 Annual Report

despite the loss. Given the abundance of reinsurance capacity, most programs were oversubscribed. Additional deployment of capacity was seen in April 2025 renewals from existing players and new entrants for key renewal markets such as Japan where competition was particularly intense. Insurers generally enjoyed low-to-mid double-digits reductions with some insurers opting for increased deductibles while others purchase additional coverage. Overall premium volume in Japan contracted and heavy over-placement was observed across some treaty programs. Natural catastrophe losses in Asia Pacific in 2025 were moderate, estimated at USD 76 billion, approximately 41% lower relative to their long-term averages. Aside from Cyclone Alfred and the hailstorm event that struck Brisbane and Queensland in March, together generating insured losses of approximately USD 2 billion. Other major loss events included Super Typhoon Ragasa and Tropical Storm Wipha, each exceeding USD 1 billion in economic losses. However, insured losses are expected to be much lower due to the wide protection gap in the region. Insured losses from Typhoon Wipha are not expected to exceed USD 250 million while losses from Super Typhoon Ragasa are estimated to be around USD 10 million. Myanmar earthquake was the key loss event of the year which accounted for approximately 14% - 20% of the economic losses in Asia Pacific. Estimated economic loss is around USD 15 billion with insured losses estimated at approximately USD 2.3 billion. Losses within Myanmar were negligible due to low insurance penetration rate. In contrast, Thailand experienced substantial losses after tremors led to the collapse of a high rise building in Bangkok. The losses insured are estimated at up to USD 1.5 billion. The fire at Wang Fuk Court housing complex in Hong Kong was the other major loss event. It was the worst fire in the territory in several decades and was brought under control only two days later. The blaze resulted in 168 deaths and caused extensive damage across seven of the estate’s eight residential blocks. Market estimates place the aggregate sum insured for the eight estate towers at approximately USD 334 million. Looking ahead, the Asia Pacific reinsurance market faces a complex mix of near-term competitive pressures and longer-term structural challenges, including exposures growth continues to outpace improvements in flood resilience. While abundant capacity and competition are expected to maintain downward pressure on pricing in the near term, particularly for well- performing portfolios. Milli Re will continue to work closely with our partners for the long term, maintaining underwriting discipline, through portfolio optimization and effective capacity utilization. Middle East and North Africa (MENA) In the Middle East and North Africa (MENA) region the growth dynamics remain uneven, reflecting the continued divergence between energy-exporting and energy importing economies, often described as the “two MENAs.” Hydrocarbon producing Gulf Cooperation Council (GCC) countries have largely preserved macroeconomic stability. In contrast, energy-importing countries such as Egypt, Jordan, Tunisia, Lebanon, and Morocco continue to face pressure from elevated debt levels and currency volatility. Geopolitical risks remained a defining feature of the regional outlook in 2025. The prolonged conflict centered around Gaza, continued instability in parts of the Levant, and broader regional security concerns have weighed on investor confidence and trade flows. At the same time, OPEC+ production management and volatility in global energy markets continued to influence fiscal balances and growth expectations across the GCC. Despite these challenges, the region retains meaningful long-term potential driven by its strategic geographic position, young population, and accelerating 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 73