HGTY 10-Q

Hagerty, Inc. (HGTY)

10-Q 2025-11-04 For: 2025-09-30

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Added on April 12, 2026

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Delaware		86-1213144
(State of incorporation)		(I.R.S. Employer Identification No.)

121 Drivers Edge, Traverse City, Michigan		49684
(Address of principal executive offices)		(Zip code)

	(800) 922-4050
	Registrant's telephone number, including area code


Large accelerated filer	☐	Accelerated filer	☒
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☒


Title						Page
Forward Looking Statements						4

Part I – Financial Information						5
Item 1. Financial Statements (Unaudited)						5
Condensed Consolidated Statements of Operations						5
Condensed Consolidated Statements of Comprehensive Income						6
Condensed Consolidated Balance Sheets						7
Condensed Consolidated Statements of Changes in Temporary Equity and Stockholders' Equity						8
Condensed Consolidated Statements of Cash Flows						12
Notes Accompanying the Condensed Consolidated Financial Statements						13
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations						48
Item 3. Quantitative and Qualitative Disclosures About Market Risk						69
Item 4. Controls and Procedures						69

Part II – Other Information						70
Item 1. Legal Proceedings						70
Item 1A. Risk Factors						70
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds						70
Item 3. Defaults Upon Senior Securities						71
Item 4. Mine Safety Disclosures						71
Item 5. Other Information						71
Item 6. Exhibits						72
Signatures						73


	Three months ended September 30,				Nine months ended September 30,
	2025		2024		2025		2024

REVENUE:	in thousands (except per share amounts)
Commission and fee revenue	$	137,103	$	116,161	$	380,677	$	333,817
Earned premium, net	187,039		165,686		534,179		474,917
Membership, marketplace and other revenue	55,852		41,527		153,430		99,573
Total revenue	379,994		323,374		1,068,286		908,307
OPERATING EXPENSES:
Salaries and benefits	68,110		47,192		191,275		161,001
Ceding commissions, net	87,411		77,501		247,682		221,877
Losses and loss adjustment expenses	78,626		99,430		224,969		226,515
Sales expense	77,672		59,141		199,678		146,791
General and administrative expenses	24,445		20,837		69,204		62,072
Depreciation and amortization	9,413		9,184		27,734		29,758
Gain related to divestiture	—		—		—		(87)
Total operating expenses	345,677		313,285		960,542		847,927
OPERATING INCOME	34,317		10,089		107,744		60,380
Loss related to warrant liabilities, net	—		(463)		—		(8,544)

Interest and other income (expense), net (Note 20)	(20,980)		8,359		(8,262)		27,945
INCOME BEFORE TAXES	13,337		17,985		99,482		79,781
Income tax (expense) benefit	32,834		1,022		21,184		(9,918)
NET INCOME	46,171		19,007		120,666		69,863
Net income attributable to non-controlling interest	(25,323)		(14,122)		(80,474)		(55,951)
Accretion of Series A Convertible Preferred Stock	(1,903)		(1,875)		(5,653)		(5,552)
NET INCOME ATTRIBUTABLE TO CLASS A COMMON STOCKHOLDERS	$	18,945	$	3,010	$	34,539	$	8,360

Earnings per share of Class A Common Stock:
Basic	$	0.18	$	0.03	$	0.35	$	0.09
Diluted	$	0.11	$	0.03	$	0.29	$	0.09

Weighted average shares of Class A Common Stock outstanding:
Basic	96,167		89,691		92,326		86,689
Diluted	347,240		89,691		346,672		87,601


	Three months ended September 30,				Nine months ended September 30,
	2025		2024		2025		2024

	in thousands
Net income	$	46,171	$	19,007	$	120,666	$	69,863
Other comprehensive income, net of tax:
Change in net unrealized gain (loss) on available-for-sale investments	1,893		7,970		6,978		8,718
Foreign currency translation adjustments	720		402		2,427		(425)
Change in unrealized loss on interest rate swap	—		—		—		(2,234)
Other comprehensive income	2,613		8,372		9,405		6,059
Comprehensive income	48,784		27,379		130,071		75,922
Comprehensive income attributable to non-controlling interest	(27,200)		(20,380)		(87,367)		(60,475)
Accretion of Series A Convertible Preferred Stock	(1,903)		(1,875)		(5,653)		(5,552)
Comprehensive income attributable to Class A Common Stockholders	$	19,681	$	5,124	$	37,051	$	9,895


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


	September 30,		December 31,
	2025		2024

ASSETS	in thousands (except share amounts)
Current Assets:
Cash and cash equivalents	$	160,386	$	104,784
Restricted cash and cash equivalents	172,261		128,061
Investments	130,147		73,957
Accounts receivable	107,476		84,763
Premiums receivable	230,919		153,748
Commissions receivable	27,404		20,430
Notes receivable	94,158		45,417
Deferred acquisition costs, net	192,496		156,466
Other current assets	99,073		90,779
Total current assets	1,214,320		858,405
Investments	543,772		515,570
Notes receivable	17,807		11,555

Lease right-of-use assets	42,229		44,485
Intangible assets, net	88,452		90,107
Goodwill	114,150		114,123
Deferred tax assets	45,265		—
Other long-term assets	85,960		75,093
TOTAL ASSETS	$	2,151,955	$	1,709,338
LIABILITIES, TEMPORARY EQUITY AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable, accrued expenses and other current liabilities	$	147,868	$	104,496
Current portion of long-term debt	73,118		792
Losses payable and provision for unpaid losses and loss adjustment expenses	276,678		266,878
Ceding commissions payable	107,473		77,389
Advance premiums and due to insurers	171,616		108,352
Unearned premiums	439,395		357,539

Total current liabilities	1,216,148		915,446
Long-term lease liabilities	40,511		43,178
Long-term debt, net	104,386		104,968
Deferred tax liability	24,185		18,065
Tax receivable agreement liability	37,913		1,956

Other long-term liabilities	14,021		17,556
TOTAL LIABILITIES	1,437,164		1,101,169
Commitments and Contingencies (Note 22)	—		—
TEMPORARY EQUITY
Preferred stock, $0.0001 par value (20,000,000 shares authorized, 8,483,561 Series A Convertible Preferred Stock issued and outstanding as of September 30, 2025 and December 31, 2024)	84,716		84,663
STOCKHOLDERS' EQUITY
Class A Common Stock, $0.0001 par value (500,000,000 shares authorized, 100,426,473 and 90,032,391 issued and outstanding as of September 30, 2025 and December 31, 2024, respectively)	10		9
Class V Common Stock, $0.0001 par value (300,000,000 authorized, 241,552,156 and 251,033,906 shares issued and outstanding as of September 30, 2025 and December 31, 2024, respectively)	24		25
Additional paid-in capital	622,405		603,780
Accumulated earnings (deficit)	(411,786)		(451,978)
Accumulated other comprehensive income (loss)	998		(1,514)
Total stockholders' equity	211,651		150,322
Non-controlling interest	418,424		373,184
Total equity (Note 17)	630,075		523,506
TOTAL LIABILITIES, TEMPORARY EQUITY AND STOCKHOLDERS' EQUITY	$	2,151,955	$	1,709,338


					Three months ended September 30, 2025
	Temporary Equity			Stockholders' Equity
	Series A Convertible Preferred Stock			Class A Common Stock			Class V Common Stock			Additional Paid in Capital		Accumulated Earnings (Deficit)		Accumulated Other Comprehensive Income		Total Stockholders' Equity		Non-controlling Interest		Total Equity
in thousands	Shares	Amount		Shares	Amount		Shares	Amount
Balance at July 1, 2025	8,484	$	82,813	90,716	$	9	251,034	$	25	$	604,621	$	(432,634)	$	262	$	172,283	$	405,755	$	578,038
Net income	—	—		—	—		—	—		—		20,848		—		20,848		25,323		46,171
Accretion of Series A Convertible Preferred Stock	—	1,903		—	—		—	—		(1,903)		—		—		(1,903)		—		(1,903)
Other comprehensive income	—	—		—	—		—	—		—		—		736		736		1,877		2,613
Issuance of shares under employee plans, net of shares withheld for employee taxes	—	—		226	—		—	—		(1,084)		—		—		(1,084)		—		(1,084)
Share-based compensation	—	—		—	—		—	—		5,089		—		—		5,089		—		5,089
Exchange of THG units for Class A Common Stock	—	—		9,484	1		(9,482)	(1)		15,929		—		—		15,929		(15,929)		—
Deferred tax assets recorded upon exchange of THG units for shares of Class A Common Stock	—	—		—	—		—	—		6,956		—		—		6,956		—		6,956
Tax receivable agreement liabilities recorded upon exchange of THG units for shares of Class A Common Stock	—	—		—	—		—	—		(5,638)		—		—		(5,638)		—		(5,638)
Distributions paid to non-controlling interest unit holders	—	—		—	—		—	—		—		—		—		—		(167)		(167)
Reallocation between controlling and non-controlling interest	—	—		—	—		—	—		(1,565)		—		—		(1,565)		1,565		—
Balance at September 30, 2025	8,484	$	84,716	100,426	$	10	241,552	$	24	$	622,405	$	(411,786)	$	998	$	211,651	$	418,424	$	630,075


					Nine months ended September 30, 2025
	Temporary Equity			Stockholders' Equity
	Series A Convertible Preferred Stock			Class A Common Stock			Class V Common Stock			Additional Paid in Capital		Accumulated Earnings (Deficit)		Accumulated Other Comprehensive Income (Loss)		Total Stockholders' Equity		Non-controlling Interest		Total Equity
in thousands	Shares	Amount		Shares	Amount		Shares	Amount
Balance at January 1, 2025	8,484	$	84,663	90,032	$	9	251,034	$	25	$	603,780	$	(451,978)	$	(1,514)	$	150,322	$	373,184	$	523,506
Net income	—	—		—	—		—	—		—		40,192		—		40,192		80,474		120,666
Accretion of Series A Convertible Preferred Stock	—	5,653		—	—		—	—		(5,653)		—		—		(5,653)		—		(5,653)
Dividends related to Series A Convertible Preferred Stock	—	(5,600)		—	—		—	—		—		—		—		—		—		—
Other comprehensive income	—	—		—	—		—	—		—		—		2,512		2,512		6,893		9,405
Issuance of shares under employee plans, net of shares withheld for employee taxes	—	—		832	—		—	—		(3,247)		—		—		(3,247)		—		(3,247)
Share-based compensation	—	—		—	—		—	—		14,627		—		—		14,627		—		14,627
Exchange of THG units for Class A Common Stock	—	—		9,562	1		(9,482)	(1)		16,641		—		—		16,641		(16,641)		—
Deferred tax assets recorded upon exchange of THG units for shares of Class A Common Stock	—	—		—	—		—	—		6,956		—		—		6,956		—		6,956
Tax receivable agreement liabilities recorded upon exchange of THG units for shares of Class A Common Stock	—	—		—	—		—	—		(5,638)		—		—		(5,638)		—		(5,638)
Distributions paid to non-controlling interest unit holders	—	—		—	—		—	—		—		—		—		—		(30,547)		(30,547)
Reallocation between controlling and non-controlling interest	—	—		—	—		—	—		(5,061)		—		—		(5,061)		5,061		—
Balance at September 30, 2025	8,484	$	84,716	100,426	$	10	241,552	$	24	$	622,405	$	(411,786)	$	998	$	211,651	$	418,424	$	630,075


					Three months ended September 30, 2024
	Temporary Equity			Stockholders' Equity
	Series A Convertible Preferred Stock			Class A Common Stock			Class V Common Stock			Additional Paid in Capital		Accumulated Earnings (Deficit)		Accumulated Other Comprehensive Income (Loss)		Total Stockholders' Equity		Non-controlling Interest		Total Equity
in thousands	Shares	Amount		Shares	Amount		Shares	Amount
Balance at July 1, 2024	8,484	$	80,913	85,703	$	8	251,034	$	25	$	555,040	$	(459,968)	$	(667)	$	94,438	$	359,955	$	454,393
Net income	—	—		—	—		—	—		—		4,885		—		4,885		14,122		19,007
Accretion of Series A Convertible Preferred Stock	—	1,875		—	—		—	—		(1,875)		—		—		(1,875)		—		(1,875)
Other comprehensive income	—	—		—	—		—	—		—		—		2,114		2,114		6,258		8,372
Issuance of shares under employee plans, net of shares withheld for employee taxes	—	—		212	—		—	—		(1,125)		—		—		(1,125)		—		(1,125)
Warrant Exchange (see Note 6)	—	—		3,876	1		—	—		42,569		—		—		42,570		—		42,570
Share-based compensation	—	—		—	—		—	—		4,092		—		—		4,092		—		4,092
Exchange of THG units for Class A Common Stock	—	—		189	—		—	—		2,055		—		—		2,055		(2,055)		—
Reallocation between controlling and non-controlling interest	—	—		—	—		—	—		1,111		—		—		1,111		(1,111)		—
Balance at September 30, 2024	8,484	$	82,788	89,980	$	9	251,034	$	25	$	601,867	$	(455,083)	$	1,447	$	148,265	$	377,169	$	525,434


					Nine months ended September 30, 2024
	Temporary Equity			Stockholders' Equity
	Series A Convertible Preferred Stock			Class A Common Stock			Class V Common Stock			Additional Paid in Capital		Accumulated Earnings (Deficit)		Accumulated Other Comprehensive Income (Loss)		Total Stockholders' Equity		Non-controlling Interest		Total Equity
in thousands	Shares	Amount		Shares	Amount		Shares	Amount
Balance at January 1, 2024	8,484	$	82,836	84,589	$	8	251,034	$	25	$	561,754	$	(468,995)	$	(88)	$	92,704	$	317,805	$	410,509
Net income	—	—		—	—		—	—		—		13,912		—		13,912		55,951		69,863
Accretion of Series A Convertible Preferred Stock	—	5,552		—	—		—	—		(5,552)		—		—		(5,552)		—		(5,552)
Dividends related to Series A Convertible Preferred Stock	—	(5,600)		—	—		—	—		—		—		—		—		—		—
Other comprehensive income	—	—		—	—		—	—		—		—		1,535		1,535		4,524		6,059
Issuance of shares under employee plans, net of shares withheld for employee taxes	—	—		1,195	—		—	—		(5,713)		—		—		(5,713)		—		(5,713)
Warrant Exchange (see Note 6)	—	—		3,876	1		—	—		42,569		—		—		42,570		—		42,570
Share-based compensation	—	—		—	—		—	—		13,018		—		—		13,018		—		13,018
Exchange of THG units for Class A Common Stock	—	—		320	—		—	—		3,227		—		—		3,227		(3,227)		—
Distributions paid to non-controlling interest THG unitholders	—	—		—	—		—	—		—		—		—		—		(5,320)		(5,320)
Reallocation between controlling and non-controlling interest	—	—		—	—		—	—		(7,436)		—		—		(7,436)		7,436		—
Balance at September 30, 2024	8,484	$	82,788	89,980	$	9	251,034	$	25	$	601,867	$	(455,083)	$	1,447	$	148,265	$	377,169	$	525,434


	Nine months ended September 30,
	2025		2024

OPERATING ACTIVITIES:	in thousands
Net income	$	120,666	$	69,863
Adjustments to reconcile net income to net cash from operating activities:
Loss on disposals of equipment, software and other assets	1,440		401
Loss related to warrant liabilities, net	—		8,544
Expense related to tax receivable agreement liability	32,275		1,322
Depreciation and amortization	27,734		29,758
Provision for deferred taxes	(34,413)		2,772

Share-based compensation expense	14,627		13,018
Non-cash lease expense	6,590		5,920
Realized (gain) loss on investments, net	(2,150)		(1,783)
(Accretion) amortization of discount and premium, net	(3,489)		(1,755)
Other	1,681		1,775
Changes in operating assets and liabilities:
Accounts, premiums and commissions receivable	(124,250)		(28,062)
Deferred acquisition costs, net	(36,030)		(26,998)
Losses payable and provision for unpaid losses and loss adjustment expenses	9,800		60,328
Ceding commissions payable	30,084		(14,734)
Advance premiums and due to insurers	62,583		48,752
Unearned premiums	81,855		68,344
Operating lease assets and liabilities	(6,876)		(6,781)
Other assets and liabilities, net	7,758		(41,042)
Net Cash Provided by Operating Activities	189,885		189,642
INVESTING ACTIVITIES:
Capital expenditures	(18,499)		(17,278)
Acquisitions, net of cash acquired, and other investments	(2,125)		(23,865)
Issuance of notes receivable	(49,095)		(55,030)
Collection of notes receivable	14,832		32,099
Purchases of fixed maturity securities	(223,055)		(565,838)
Proceeds from sales of fixed maturity securities	41,173		53,253
Proceeds from maturities of fixed maturity securities	122,196		23,766
Purchases of equity securities	(10,565)		(10,602)
Proceeds from sales of equity securities	911		—
Other investing activities	1,421		1,005
Net Cash Used in Investing Activities	(122,806)		(562,490)
FINANCING ACTIVITIES:
Payments on long-term debt	(170,673)		(63,202)
Proceeds from long-term debt, net of issuance costs	240,701		52,718
Distributions paid to non-controlling interest unit holders	(30,547)		(5,320)
Payment of Series A Convertible Preferred Stock dividends	(5,600)		(5,600)
Funding of tax receivable agreement payments	(223)		—
Funding of employee tax obligations upon vesting of share-based payments	(3,536)		(5,713)
Other financing activities	289		—
Net Cash Provided by (Used in) Financing Activities	30,411		(27,117)
Effect of exchange rate changes on cash and cash equivalents and restricted cash and cash equivalents	2,312		(882)

Change in cash and cash equivalents and restricted cash and cash equivalents	99,802		(400,847)
Beginning cash and cash equivalents and restricted cash and cash equivalents	232,845		724,276
Ending cash and cash equivalents and restricted cash and cash equivalents	$	332,647	$	323,429


	Balance Sheet Classification	September 30,		December 31,
		2025		2024

		in thousands
Cash and cash equivalents	Restricted cash and cash equivalents	$	172,261	$	128,061
Fixed maturity securities	Investments	650,622		577,688
Equity securities	Investments	23,297		11,839
Total restricted assets		$	846,180	$	717,588


	Three months ended September 30, 2025
	Agent		Direct		Total

	in thousands
Commission and fee revenue	$	67,685	$	54,049	$	121,734
Contingent commission revenue	8,466		6,903		15,369
Membership revenue	—		15,961		15,961
Marketplace revenue	—		31,208		31,208
Other revenue	—		5,716		5,716
Total revenue from customer contracts	76,151		113,837		189,988
Earned premium, net (recognized under ASC 944)					187,039
Finance revenue (recognized under ASC 310)					2,967
Total revenue					$	379,994


	September 30, 2025
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value

Fixed maturity securities:	in thousands
Corporate	$	246,554	$	4,113	$	(144)	$	250,523
U.S. Treasury	174,317		695		(206)		174,806
States and municipalities	27,209		812		—		28,021
Foreign	27,814		84		(5)		27,893
Asset-backed securities	30,065		338		(44)		30,359
Mortgage-backed securities	136,792		2,630		(402)		139,020
Total fixed maturity securities	$	642,751	$	8,672	$	(801)	$	650,622


	December 31, 2024
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value

Fixed maturity securities:	in thousands
Corporate	$	230,917	$	1,226	$	(954)	$	231,189
U.S. Treasury	146,211		424		(760)		145,875
States and municipalities	31,543		134		(92)		31,585
Foreign	21,022		59		(24)		21,057
Asset-backed securities	23,625		175		(120)		23,680
Mortgage-backed securities	125,351		396		(1,445)		124,302
Total fixed maturity securities	$	578,669	$	2,414	$	(3,395)	$	577,688


	September 30, 2025
	Less than 12 months				12 months or longer				Total
	Estimated fair value		Gross unrealized losses		Estimated fair value		Gross unrealized losses		Estimated fair value		Gross unrealized losses

Fixed maturity securities:	in thousands
Corporate	$	—	$	—	$	11,426	$	(144)	$	11,426	$	(144)
U.S. Treasury	16,552		(72)		23,777		(134)		40,329		(206)

Foreign	8,237		(5)		—		—		8,237		(5)
Asset-backed securities	1,516		(2)		1,876		(42)		3,392		(44)
Mortgage-backed securities	1,244		(6)		19,246		(396)		20,490		(402)
Total fixed maturity securities	$	27,549	$	(85)	$	56,325	$	(716)	$	83,874	$	(801)



	Amortized Cost		Estimated Fair Value

	in thousands
Due in one year or less	$	106,600	$	106,851
Due after one year through five years	271,631		275,364
Due after five years through ten years	97,663		99,028

Mortgage-backed and asset-backed securities	166,857		169,379
Total fixed maturity securities	$	642,751	$	650,622


	Three months ended September 30, 2025
	U.S.		Canada		Europe		Total

	in thousands
Commission and fee revenue	$	112,179	$	7,556	$	1,999	$	121,734
Contingent commission revenue	15,072		—		297		15,369
Membership revenue	14,895		1,057		9		15,961
Marketplace revenue	25,303		3,729		2,176		31,208
Other revenue	5,026		63		627		5,716
Total revenue from customer contracts	172,475		12,405		5,108		189,988
Earned premium, net (recognized under ASC 944)							187,039
Finance revenue (recognized under ASC 310)							2,967
Total revenue							$	379,994


	Private Warrants		Underwriter Warrants		OTM Warrants		PIPE Warrants		Total

	in thousands
Balance at December 31, 2023	$	476	$	53	$	3,981	$	20,020	$	24,530
Change in fair value of warrant liabilities	55		5		546		4,056		4,662
Warrant Exchange	(531)		(58)		(4,527)		(24,076)		(29,192)
Balance at September 30, 2024	$	—	$	—	$	—	$	—	$	—


	Estimated Fair Value as of September 30, 2025
	Total		Level 1		Level 2		Level 3

	in thousands
Investments:
Corporate	$	250,523	$	—	$	250,523	$	—
U.S. Treasury	174,806		—		174,806		—
States and municipalities	28,021		—		28,021		—
Foreign	27,893		—		27,893		—
Asset-backed securities	30,359		—		30,359		—
Mortgage-backed securities	139,020		—		139,020		—
Common stocks	23,297		23,297		—		—
Total	$	673,919	$	23,297	$	650,622	$	—

	Estimated Fair Value as of December 31, 2024
	Total		Level 1		Level 2		Level 3

	in thousands
Investments:
Corporate	$	231,189	$	—	$	231,189	$	—
U.S. Treasury	145,875		—		145,875		—
States and municipalities	31,585		—		31,585		—
Foreign	21,057		—		21,057		—
Asset-backed securities	23,680		—		23,680		—
Mortgage-backed securities	124,302		—		124,302		—
Common stocks	11,839		11,839		—		—
Total	$	589,527	$	11,839	$	577,688	$	—


	in thousands
2025 - remaining	$	2,333
2026	8,971
2027	8,518
2028	8,446
2029	6,665
Thereafter	22,757
Total lease payments	57,690
Less: imputed interest	(10,319)
Total lease liabilities	$	47,371


	September 30, 2025
	Weighted average useful life	Gross carrying amount		Accumulated amortization		Net carrying amount

		in thousands
Internally developed software	3.4	$	149,831	$	(97,638)	$	52,193
Renewal rights	10.0	21,647		(10,064)		11,583
Trade names and trademarks	14.2	11,867		(4,113)		7,754
State licenses (1)	Indefinite	11,263		—		11,263
Relationships and customer lists	15.5	7,907		(2,248)		5,659
Other	3.6	619		(619)		—
Total intangible assets		$	203,134	$	(114,682)	$	88,452


	in thousands
2025 - remaining	$	6,013
2026	22,475
2027	19,142
2028	13,165
2029	5,393
Thereafter	11,001
Total	$	77,189


		September 30,		December 31,
	Maturity	2025		2024

		in thousands
2025 JPM Credit Facility	March 2030	$	77,484	$	—
Prior JPM Credit Facility (1)	October 2026	—		50,296
BAC Credit Facility	December 2026	75,000		30,193
State Farm Term Loan	September 2033	25,000		25,000
Notes payable	October 2025	496		792
Total debt		177,980		106,281
Less: BAC Credit Facility, current portion		(72,622)		—
Less: Notes payable, current portion		(496)		(792)
Less: Unamortized debt issuance costs related to the State Farm Term Loan		(476)		(521)
Total long-term debt, net		$	104,386	$	104,968


	Restricted Stock Units	Weighted Average Grant Date Fair Value
Unvested balance as of December 31, 2024	3,682,679	$	9.65
Granted	1,166,295	9.07
Vested (1)	(1,174,388)	9.57
Forfeited	(85,048)	9.21
Unvested balance as of September 30, 2025	3,589,538	$	9.50


Inputs						Performance Restricted Stock Units
Weighted average grant-date fair value per share						$5.19
Expected stock volatility						35%
Expected term (in years)						7.0
Risk-free interest rate						2.5%
Dividend yield						—%


	Markel			State Farm
Equity Interest	Shares/Units	Percentage of total outstanding (1)		Shares/Units	Percentage of total outstanding (1)
Hagerty, Inc. Class A Common Stock	3,108,000	3.1	%	51,800,000	51.6	%
Hagerty, Inc. Class V Common Stock	75,000,000	31.0	%	—	—	%
Hagerty, Inc. Series A Convertible Preferred Stock	1,590,668	18.8	%	5,302,226	62.5	%
THG units	75,000,000	21.7	%	—	—	%

Controlling interest	3,108,000	3.1	%	51,800,000	51.6	%
Non-controlling interest	75,000,000	30.5	%	—	—	%


	Three months ended September 30,
	2025			2024			Change

Operational Metrics	dollars in thousands (except per share amounts)
Total Written Premium (1)	$	334,048		$	287,609		$	46,439		16.1	%
Hagerty Re Loss Ratio (2)	42.0		%	60.0		%	(18.0)		%	N/M
Hagerty Re Combined Ratio (3)	89.6		%	107.7		%	(18.1)		%	N/M
New Business Count — Insurance (4)	114,513			77,418			37,095			47.9	%

GAAP Financial Measures
Total Revenue	$	379,994		$	323,374		$	56,620		17.5	%
Operating Income	$	34,317		$	10,089		$	24,228		240.1	%
Net Income	$	46,171		$	19,007		$	27,164		142.9	%
Basic Earnings Per Share	$	0.18		$	0.03		$	0.15		N/M
Diluted Earnings Per Share	$	0.11		$	0.03		$	0.08		N/M

Non-GAAP Financial Measures
Adjusted EBITDA (5)	$	49,714		$	24,165		$	25,549		105.7	%
Adjusted Earnings Per Share (5)	$	0.13		$	0.05		$	0.08		160.0	%


Exhibit No.						Description
2.1*						Business Combination Agreement, dated as of August 17, 2021, by and among Aldel Financial Inc. Aldel Merger Sub LLC and The Hagerty Group, LLC (incorporated by reference to Exhibit 2.1 of the Company’s Form 8-K (File No. 001-40244), filed with the SEC on August 18, 2021).
3.1						Third Amended and Restated Certificate of Incorporation of the Company, dated December 2, 2021 (incorporated by reference to Exhibit 3.1 of the Company’s Amendment No.3 to Form S-1 (File No. 333-261810), filed with the SEC on January 20, 2023).
3.2						Amended and Restated By-Laws of the Company, dated December 2, 2021 (incorporated by reference to Exhibit 3.2 of the Company’s Form 8-K (File No. 001-40244), filed with the SEC on December 8, 2021).
3.3						Certificate of Designations, Preferences and Rights of Series A Convertible Preferred Stock of the Company dated June 23, 2023 (incorporated by reference to Exhibit 3.1 of the Company’s Form 8-K (File No. 001-40244), filed with the SEC on June 23, 2023).
31.1						Certification of the Chief Executive Officer Pursuant to Rule 13a-14(a).
31.2						Certification of the Chief Financial Officer Pursuant to Rule 13a-14(a).
32.1#						Certification of the Chief Executive Officer Pursuant to 18 U.S.C. Section 1350 .
32.2#						Certification of the Chief Financial Officer Pursuant to 18 U.S.C. Section 1350 .
101.INS						XBRL Instance Document.
101.SCH						XBRL Taxonomy Extension Schema Document.
101.CAL						XBRL Taxonomy Extension Calculation Linkbase Document.
101.LAB						XBRL Taxonomy Extension Label Linkbase Document.
101.PRE						XBRL Taxonomy Extension Presentation Linkbase Document
101.DEF						XBRL Taxonomy Extension Definition Linkbase Document.
104						Cover Page Interactive Data File (formatted as Inline XBRL).


*						The schedules and exhibits to this agreement have been omitted pursuant to Item 601(a)(5) of Regulation S-K. A copy of any omitted schedule and/or exhibit will be furnished to the SEC upon request. In addition, portions of this exhibit have been redacted pursuant to Item 601(b)(10)(iv) of Regulation S-K because the registrant customarily and actually treats that information as private or confidential and the omitted information is not material.

#						This certification is not deemed filed for the purpose of Section 18 of the Exchange Act or otherwise subject to the liability of that section, nor shall it be deemed incorporated by reference into any filing under the Securities Act or the Exchange Act.