MILLI RE 2020 ANNUAL REPORT

Financial Status Risks and Assessment of the Governing Body Unconsolidated Financial Statements Together with Independent Auditors’ Report Thereon Consolidated Financial Statements Together with Independent Auditors’ Report Thereon 51 Milli Re Annual Report 2020 restrictions due to the pandemic and the continuation of the remote working model, it is anticipated that the demand for cyber insurance, as well as product diversity and the number of insurance companies providing coverage, is expected to increase. Positive developments in takaful insurance in recent years have been enhanced by regulatory actions as well as the emphasis given by the state to alternative financial markets. Total premium produced in this segment has reached 6% of the industry premium income at the end of 2020. One of the most important developments in the Turkish insurance industry was the establishment of Insurance and Private Pension Regulation and Supervision Authority (Sigorta Ve Özel Emeklilik Düzenleme ve Denetleme Kurumu – SEDDK). With this structure, it is envisaged that managing insurance industry through an exclusive entity will enable the maintenance of an optimum coordination between regulatory and supervisory functions and addressing the problems of the industry in a more rapid, efficient and effective manner. In the coming period, it is expected that the initiatives to insure important infrastructure projects with the cooperation of the public and private sectors, increase in the scope and prevalence of the agricultural insurance pool Tarsim, increase in the insurance penetration in industrial risks and SMEs, within the framework of the New Economy Program, will increase the share of insurance in the economy. Market Premium (TL) Branches 2020 Share (%) 2019 Share (%) Change (%) Accident 2,237,228,105 3.28 2,372,741,294 4.10 (5.71) Health 10,095,516,816 14.81 8,358,100,508 14.44 20.79 Land Vehicles 10,737,412,046 15.76 9,406,268,988 16.25 14.15 Railway Vehicles 15,272 - 13,280 - 15.00 Air Vehicles 369,664,551 0.54 223,854,250 0.39 65.14 Sea Vehicles 621,688,667 0.91 413,511,536 0.71 50.34 Marine 1,204,301,235 1.77 950,787,872 1.64 26.66 Fire & Natural Disasters 10,585,806,877 15.53 8,447,104,595 14.59 25.32 General Damages 7,962,761,912 11.69 5,876,737,145 10.15 35.50 Land Vehicles Liability 20,487,190,549 30.06 18,712,174,135 32.33 9.49 Air Vehicles Liability 298,548,469 0.44 263,898,565 0.46 13.13 Sea Vehicles Liability 57,810,503 0.08 44,655,983 0.08 29.46 General Liability 2,190,044,929 3.21 1,712,228,206 2.96 27.91 Credit 399,061,225 0.59 304,281,300 0.53 31.15 Fidelity Guarantee 123,951,705 0.18 91,177,756 0.16 34.47 Financial Losses 547,980,509 0.80 505,294,367 0.87 8.45 Legal Protection 224,970,171 0.33 198,465,014 0.34 13.36 Support 1,928 - 158,666 - (98.78) Total Non-life 68,143,955,472 82.52 57,882,453,461 83.59 17.73 Life 14,431,890,533 17.48 11,359,715,131 16.41 27.04 Total 82,575,846,005 100.00 69,242,168,593 100.00 19.26 Source: Insurance Association of Turkey