Release Details

Hagerty Reports Second Quarter 2026 Results

August 5, 2026

Increases 2026 Growth Outlook

First Half 2026 Highlights:

  • Strong underlying operational performance with record growth in members, written premium, and earned premium
  • First half 2026 Written Premium grew 19% year-over-year to $713 million
    • Added a record 279,000 new members in the first half of 2026, with policy in force growth of 19% year-over-year to 1.9 million members
  • First half 2026 Earned Premium increased 42% to $492 million
  • Transition to Markel Fronting Arrangement on January 1, 2026 resulted in decrease to reported revenue as previously disclosed
  • First half 2026 Net Loss of $5 million, including $153 million of pre-tax Markel Fronting Arrangement transitional costs, compared to Net Income of $74 million in the prior year period
  • First half 2026 Adjusted EBITDA (a non-GAAP measure) increased 32% to $160 million, compared to $121 million in the prior year period
  • First half 2026 Cash Flow from Operating Activities increased 91% to $186 million
  • Increased 2026 Outlook — Written Premium growth of 16% to 17%, Net Income of $18 to $30 million, and Adjusted EBITDA of $270 to $280 million

TRAVERSE CITY, Mich., Aug. 5, 2026 /PRNewswire/ -- Hagerty, Inc. (NYSE: HGTY) makes it easier and more enjoyable for car enthusiasts to drive and celebrate the vehicles they love — through specialty vehicle insurance, live and digital auctions, engaging media and events, and the Hagerty Drivers Club, the world's largest membership community of car lovers. Today the company announced financial results for the three and six months ended June 30, 2026.

Hagerty New Logo

"The first half of 2026 has been the best in Hagerty's history, and our results give us the confidence to significantly increase our full year outlook. We delivered year-to-date written premium growth of 19% and Adjusted EBITDA gains of 32%, reflecting the compounding power of our model as we now control 100% of the economics on our U.S. book. This is what forty years of building trust — one member, one partner, one car at a time — looks like when the flywheel hits its stride," said McKeel Hagerty, Chief Executive Officer and Chairman of Hagerty.

"Our momentum is showing up across every part of the Hagerty ecosystem, including crossing three million insured vehicles. Broad Arrow delivered first half revenue growth of 17%, with a 91% auction sell-through rate and demand from buyers on multiple continents. And in the third quarter, we will welcome the team and members of Bennetts, the United Kingdom's second largest specialty motorcycle insurance broker to the Hagerty family, tripling our scale in that market," added Mr. Hagerty.

SECOND QUARTER 2026 FINANCIAL HIGHLIGHTS

  • Second quarter 2026 Written Premium increased 19% year-over-year to $425 million, and year-to-date 2026 Written Premium increased 19% year-over-year to $713 million
  • Second quarter 2026 Hagerty Re Earned Premium increased 42% year-over-year to $252 million, and year-to-date 2026 Earned Premium increased 42% year-over-year to $492 million
    • Driven by the Markel Fronting Arrangement which increased Hagerty Re's U.S. quota share from 80% to 100% including in-force policies written in 2025, as well as growth in subject premiums written by our MGA subsidiaries
    • Policies in Force Retention was 88.2% as of June 30, 2026 compared to 88.7% in the prior year period, and policies in force count increased 19% year-over-year to 1.9 million
  • Second quarter 2026 MGA+ reporting unit Commission and fee revenue increased 17% to $167 million, and year-to-date 2026 MGA+ reporting unit Commission and fee revenue increased 18% year-over-year to $287 million, reflecting organic growth in the Essentia and State Farm books of business
    • Assuming control of the Essentia book through the Markel Fronting Arrangement in the first quarter of 2026 requires the elimination of $144 million of Commission and fee revenue in the second quarter of 2026 and $247 million in the first half of 2026 in the Condensed Consolidated Statements of Operations
    • On a consolidated basis, second quarter 2026 Commission and fee revenue decreased 83% year-over-year to $24 million, and year-to-date 2026 Commission and fee revenue decreased 84% year-over-year to $40 million
  • Second quarter 2026 Marketplace revenue increased 48% year-over-year to $40 million, and year-to-date 2026 Marketplace revenue increased 17% year-over-year to $65 million
    • Strong sales growth at live auctions and increased financing revenue which was enabled by the upsized BAC Credit Facility
  • Second quarter 2026 Membership and other revenue increased 3% year-over-year to $21 million, and year-to-date 2026 Membership and other revenue increased 5% year-over-year to $43 million
    • Hagerty Drivers Club (HDC) paid members increased 6% year-over-year to over 962,000
  • Second quarter 2026 Net investment income increased 17% year-over-year to $11 million, and year-to-date 2026 Net investment income increased 15% year-over-year to $21 million
  • Second quarter 2026 Total Revenue decreased 6% year-over-year to $355 million, and year-to-date 2026 Total Revenue decreased 6% year-over-year to $667 million, reflecting the transition to the Markel Fronting Arrangement
  • Second quarter 2026 Hagerty Re Loss Ratio was 42.7% compared to 42.3% in the prior year period, and year-to-date 2026 Hagerty Re Loss Ratio was 40.6% compared to 42.2% in the prior year period
    • Second quarter 2026 Hagerty Re Combined Ratio was 89.6% compared to 89.6% in the prior year period, and year-to-date 2026 Hagerty Re Combined Ratio was 88.1% compared to 89.1% in the prior year period
  • Second quarter 2026 Policy acquisition costs, net increased 1% to $84 million, and year-to-date 2026 Policy acquisition costs, net increased 16% to $186 million. The year-to-date increase is primarily due to the transition of our business under the Markel Fronting Arrangement, which resulted in incremental ceding commission expense for in-force policies written in 2025 and assumed at 100% on January 1, 2026, as well as an increase in earned premium
  • The transition to the Markel Fronting Arrangement and adoption of Article 7 reporting standards for insurance companies reclassified certain costs among expense captions on the Condensed Consolidated Statements of Operations, reducing period-over-period comparability of individual captions without affecting total expenses. Beginning in 2026, following our assumption of control over the Essentia book of business, operating costs incurred by our U.S. MGA subsidiary in support of risk-taking activities are classified within Underwriting and other insurance expenses, versus Selling, general, and administrative expenses
    • Together, second quarter 2026 Underwriting and other insurance expenses and Selling, general, and administrative expenses within the Insurance segment decreased 11% to $119 million, and year-to-date 2026 decreased 10% to $225 million. This decrease was primarily a result of the deferral of costs incurred by our MGA subsidiary for the successful acquisition or renewal of insurance policies issued under the Markel Fronting Arrangement. In 2025, these costs were expensed as incurred
  • Second quarter 2026 Income before taxes of $2 million, including $64 million of Markel Fronting Arrangement transitional costs, and year-to-date 2026 Loss before taxes of $19 million, including $153 million of Markel Fronting Arrangement transitional costs
  • Second quarter 2026 Net Income of $8 million, including $64 million of pre-tax Markel Fronting Arrangement transitional costs, compared to Net Income of $47 million in the prior year period, and year-to-date 2026 Net Loss of $5 million, compared to Net Income of $74 million in the prior year period, including $153 million of pre-tax Markel Fronting Arrangement transitional costs
  • Second quarter 2026 Adjusted EBITDA (a non-GAAP measure) increased 3% year-over-year to $75 million, compared to $73 million in the prior year period, and year-to-date 2026 Adjusted EBITDA increased 32% year-over-year to $160 million, compared to $121 million in the prior year period
  • Second quarter 2026 Basic and Diluted Loss Per Share were $(0.02), and year-to-date 2026 Basic and Diluted Loss Per Share were $(0.08)
  • Second quarter 2026 Adjusted Diluted Loss Per Share (a non-GAAP measure) was $(0.02), and year-to-date 2026 Adjusted Diluted Loss Per Share was $(0.05)
  • First half 2026 Cash Flow from Operating Activities increased 91% to $186 million
  • The Company had $298 million of unrestricted cash and $216 million of total debt, $88 million of which was back leverage for Broad Arrow Capital's portfolio of loans collateralized by collector cars

The definitions and reconciliations of non-GAAP financial measures are provided under the heading Key Performance Indicators and Non-GAAP Financial Measures at the end of this press release.

INCREASED 2026 OUTLOOK - COMPOUNDING GROWTH

We believe 2026 is on track to be another great year of underlying profit growth for Hagerty as our team executes on our long-term plan to deliver compounding premium growth through investing in our long-term competitive advantages with our member-centric approach. As of January 1, 2026, we moved to a 100% quota share arrangement with our long-term partner, Markel, where we retain 100% of the premium and risk from our high-quality, historically low volatility underwriting. We also remain focused on delivering this growth more efficiently through the benefits of scale, continued cost discipline, and investments in our technology platform.

  • For full year 2026, Hagerty anticipates:
    • Written Premium growth of 16% to 17%
    • Total Revenue change of (9)% to (8)%, as Markel-related commission revenue is eliminated under the Markel Fronting Arrangement1
    • Net Income of $18 million to $30 million, including ~$199 million of Markel Fronting Arrangement transitional costs2
    • Adjusted EBITDA of $270 million to $280 million
   

 Prior 2026 Outlook1 ($)

 

Revised 2026 Outlook ($)

 

in thousands

2025 Results

 

Low End

 

High End

 

Low End

 

High End

 

Total Written Premium

$1,193,548

 

$1,373,000

 

$1,385,000

 

$1,385,000

 

$1,397,000

 

Total Revenue2

$1,456,389

 

$1,280,000

 

$1,300,000

 

$1,325,000

 

$1,340,000

 

Net Income3, 4

$149,225

 

$(51,000)

 

$(41,000)

 

$18,000

 

$30,000

 

Adjusted EBITDA5

$236,791

 

$236,000

 

$247,000

 

$270,000

 

$280,000

 
           
  

1

Prior 2026 Outlook shared on the Company's first quarter earnings call on May 6th, 2026.

2

Revenue guidance reflects the accounting impact of the Markel Fronting Arrangement. Beginning in 2026, we now control the Essentia book of business with the benefit of our MGA services received by Hagerty Re and not Essentia. As a result, commission revenue and the associated ceding commission expense for policies issued through the Markel Fronting Arrangement are now eliminated in consolidation. Although we expect the arrangement to result in increased profitability (as reflected in Adjusted EBITDA), reported commission revenue and ceding commission expense will be significantly lower than prior periods, affecting period-to-period comparability. 2025 commission revenue associated with our alliance agreement with Markel was $437 million and 2025 ceding commission expense related to the Company's reinsurance quota share agreement with Markel was $344 million.

3

The projected Net Income includes approximately $199 million of pre-tax transitional costs related to the Markel Fronting Arrangement representing deferred ceding commissions paid to Markel for policies written prior to January 1, 2026, which will be fully amortized ratably over the remaining term of those policies throughout 2026. This amortization will decline to $37 million in Q3 2026 and approximately $9 million in Q4 2026 as 2025 policies expire. Excluding these transitional costs, we expect 2026 to reflect underlying profitability improvement.

4

Full year 2025 Net Income includes (i) the benefit from the $42 million release of a portion of our valuation allowance, partially offset by a $32 million loss related to the change in value of the TRA liability; and (ii) a $21 million reduction in reserves in the fourth quarter, primarily related to favorable development for the 2024 accident year and improvement in current accident year experience.

5

See section "Key Performance Indicators and Non-GAAP Financial Measures" below for additional information regarding this non-GAAP financial measure.

Conference Call Details

Hagerty will hold a conference call to discuss the financial results on Wednesday, August 5, 2026 10:00 am Eastern Time. A webcast of the conference call, including its Investor Presentation highlighting second quarter 2026 financial results, will be available on Hagerty's investor relations website at investor.hagerty.com. It should read as follows: To dial-in for the conference call, please register using the link found here to receive your unique dial-in and PIN. Please dial the number 10 minutes prior to the scheduled start time.

A webcast replay of the call will be available at investor.hagerty.com following the call.

Forward-Looking Statements

This press release contains statements that constitute "forward-looking statements" within the meaning of the federal securities laws. All statements we provide, other than statements of historical fact, are forward-looking statements, including those regarding Hagerty's future operating results and financial position, Hagerty's business strategy and plans, products, services, and technology implementations, market conditions, growth and trends, expansion plans and opportunities, and Hagerty's objectives for future operations. The words "anticipate," "believe," "envision," "estimate," "expect," "intend," "may," "plan," "predict," "project," "target," "potential," "will," "would," "could," "should," "continue," "ongoing," "contemplate," and similar expressions, and the negatives of these expressions, are intended to identify forward-looking statements. 

Hagerty has based these forward-looking statements largely on current expectations about future events, which may not materialize. Actual results could differ materially and adversely from those anticipated or implied in forward-looking statements. These factors include, among other things, Hagerty's ability to: (i) compete effectively within Hagerty's industry and attract and retain insurance policyholders and paid Hagerty Drivers Club ("HDC") subscribers; (ii) maintain key strategic relationships with Hagerty's insurance distribution and underwriting carrier partners; (iii) prevent, monitor, and detect fraudulent activity; (iv) manage risks associated with disruptions, interruptions, outages, or other issues with Hagerty's technology platforms or use of third-party services; (v) accelerate the adoption of Hagerty's membership and marketplace products and services, as well as any new insurance programs and products offered; (vi) successfully implement the fronting arrangement consummated with Markel and realize the anticipated benefits while also managing the increased exposure to underwriting volatility, catastrophes, reinsurance counterparty risk, and legal, compliance, and regulatory risks resulting from the shift to Hagerty Re assuming 100% of the risk for policies written through this arrangement; (vii) underwrite and price new products, including Enthusiast+, consistent with expected loss ratios and risk tolerances; (viii) execute Broad Arrow's private sale, auction, and financing strategies; (ix) complete the acquisition of Bennetts Motorcycling Services Limited ("Bennetts") on the expected terms or timeline, or at all, or realize the anticipated benefits of the Bennetts acquisition, including expected earnings enhancements and synergies; (x) achieve Hagerty's investment objectives and avoid losses in the investment portfolio; (xi) manage the cyclical nature of the insurance business and broader macroeconomic conditions, including inflation, interest rates, and potential recessionary pressures; (xii) address unexpected increases in the frequency or severity of claims, including catastrophe losses; and (xiii) comply with numerous laws and regulations applicable to Hagerty's business, including without limitation state, federal, and foreign laws relating to insurance and rate increases, privacy and cybersecurity, marketing and advertising, digital services, accounting matters, tax, anti-money laundering, and economic sanctions.

The forward-looking statements in this release represent Hagerty's views as of the date hereof. You should not rely on forward-looking statements as predictions of future events. We operate in a very competitive and rapidly changing environment and new risks emerge from time to time. This presentation should be read in conjunction with the information included in filings with the SEC and press releases. Understanding the information contained in these filings is important in order to fully understand Hagerty's reported financial results and business outlook for future periods. In addition, this press release contains certain "non-GAAP financial measures". The non-GAAP measures are presented for supplemental informational purposes only. These financial measures are not recognized measures under GAAP and should not be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. Reconciliations to the most directly comparable financial measure calculated and presented in accordance with GAAP are provided in the appendix to this press release.

About Hagerty, Inc. (NYSE: HGTY)

Hagerty is a company built by drivers for drivers, protecting 3.0 million vehicles in the United States, Canada and the UK. We make it easier and more enjoyable for car enthusiasts to drive and celebrate the vehicles they love through innovative vehicle insurance products, live and digital auctions, engaging media and events, and the Hagerty Drivers Club, the world's largest membership community of car lovers.

For more information, please visit www.hagerty.com or www.newsroom.hagerty.com. Never Stop Driving®.

Category: Financial

Source: Hagerty

Hagerty, Inc.

Condensed Consolidated Statements of Operations (Unaudited)

 
  

Three months ended June 30,

  

2026

 

2025

 

$ Change

 

% Change

         

REVENUES:

 

in thousands (except percentages and per share amounts)

Earned premium, net

 

$    251,956

 

$    177,785

 

$      74,171

 

41.7 %

Commission and fee revenue

 

23,665

 

143,287

 

(119,622)

 

(83.5) %

Marketplace revenue

 

39,658

 

26,886

 

12,772

 

47.5 %

Membership and other revenue

 

21,361

 

20,741

 

620

 

3.0 %

Net investment income

 

11,003

 

9,416

 

1,587

 

16.9 %

Net investment gains

 

7,179

 

1,194

 

5,985

 

N/M

Total revenue

 

354,822

 

379,309

 

(24,487)

 

(6.5) %

EXPENSES:

        

Losses and loss adjustment expenses, net

 

110,709

 

75,213

 

35,496

 

47.2 %

Policy acquisition costs, net

 

83,641

 

82,938

 

703

 

0.8 %

Underwriting and other insurance expenses

 

62,947

 

1,222

 

61,725

 

N/M

Selling, general, and administrative expenses

 

95,265

 

161,627

 

(66,362)

 

(41.1) %

Interest expense and other, net

28

 

4,946

 

(4,918)

 

(99.4) %

Total expenses

 

352,590

 

325,946

 

26,644

 

8.2 %

INCOME BEFORE TAXES

 

2,232

 

53,363

 

(51,131)

 

(95.8) %

Income tax (expense) benefit

 

5,809

 

(6,161)

 

11,970

 

194.3 %

NET INCOME

 

8,041

 

47,202

 

(39,161)

 

(83.0) %

Net income attributable to non-controlling interest

(7,761)

 

(36,229)

 

28,468

 

78.6 %

Accretion of Series A Convertible Preferred Stock

(1,948)

 

(1,875)

 

73

 

3.9 %

NET INCOME (LOSS) ATTRIBUTABLE TO CLASS A 
COMMON STOCKHOLDERS

$      (1,668)

 

$       9,098

 

$    (10,766)

 

(118.3) %

        

Earnings (loss) per share of Class A Common Stock:

       

Basic

 

$       (0.02)

 

$         0.09

    

Diluted

 

$       (0.02)

 

$         0.09

    
         

Weighted average shares of Class A Common Stock 
outstanding:

       

Basic

 

101,797

 

90,698

    

Diluted

 

101,797

 

90,698

    
         

____________________

N/M = Not meaningful

 

Hagerty, Inc.

Condensed Consolidated Statements of Operations (Unaudited)

 
  

Six months ended June 30,

  

2026

 

2025

 

$ Change

 

% Change

         

REVENUES:

 

in thousands (except percentages and per share amounts)

Earned premium, net

$    491,598

 

$    347,140

 

$    144,458

 

41.6 %

Commission and fee revenue

40,100

 

243,574

 

(203,474)

 

(83.5) %

Marketplace revenue

 

65,310

 

55,972

 

9,338

 

16.7 %

Membership and other revenue

43,488

 

41,606

 

1,882

 

4.5 %

Net investment income

 

21,266

 

18,474

 

2,792

 

15.1 %

Net investment gains

 

4,890

 

879

 

4,011

 

N/M

Total revenue

 

666,652

 

707,645

 

(40,993)

 

(5.8) %

EXPENSES:

        

Losses and loss adjustment expenses, net

 

208,628

 

146,343

 

62,285

 

42.6 %

Policy acquisition costs, net

 

185,563

 

160,271

 

25,292

 

15.8 %

Underwriting and other insurance expenses

 

122,535

 

2,579

 

119,956

 

N/M

Selling, general, and administrative expenses

167,681

 

305,672

 

(137,991)

 

(45.1) %

Interest expense and other, net

950

 

6,635

 

(5,685)

 

(85.7) %

Total expenses

 

685,357

 

621,500

 

63,857

 

10.3 %

INCOME (LOSS) BEFORE TAXES

(18,705)

 

86,145

 

(104,850)

 

(121.7) %

Income tax (expense) benefit

 

14,001

 

(11,650)

 

25,651

 

N/M

NET INCOME (LOSS)

 

(4,704)

 

74,495

 

(79,199)

 

(106.3) %

Net (income) loss attributable to non-controlling interest

493

 

(55,151)

 

55,644

 

100.9 %

Accretion of Series A Convertible Preferred Stock

(3,978)

 

(3,750)

 

228

 

6.1 %

NET INCOME (LOSS) ATTRIBUTABLE TO CLASS A 
COMMON STOCKHOLDERS

$      (8,189)

 

$      15,594

 

$    (23,783)

 

(152.5) %

        

Earnings (loss) per share of Class A Common Stock:

       

Basic

 

$       (0.08)

 

$         0.16

    

Diluted

 

$       (0.08)

 

$         0.16

    
         

Weighted average shares of Class A Common Stock 
outstanding:

       

Basic

 

101,418

 

90,374

    

Diluted

 

101,418

 

91,247

    
         

____________________

N/M = Not meaningful

 

Hagerty, Inc.

Condensed Consolidated Balance Sheets (Unaudited)

 
  

June 30,

 

December 31,

  

2026

 

2025

     

ASSETS

 

in thousands (except share amounts)

Fixed maturity securities available-for-sale, at fair value (amortized cost: $702,483 and $687,813 
as of June 30, 2026 and December 31, 2025, respectively)

$           701,561

 

$           696,271

Equity securities, at fair value

 

54,945

 

34,871

Total investments

 

756,506

 

731,142

Cash and cash equivalents

 

298,302

 

160,177

Restricted cash and cash equivalents

 

169,333

 

138,823

Accounts receivable

 

27,313

 

98,872

Premiums receivable

 

120,382

 

180,529

Deferred acquisition costs, net

 

100,196

 

179,224

Reinsurance recoverables

 

12,346

 

15,296

Prepaid reinsurance premiums

 

49,846

 

21,950

Notes receivable

 

153,302

 

113,887

Intangible assets, net

 

89,315

 

88,915

Goodwill

 

114,134

 

114,164

Deferred tax assets

 

48,021

 

43,011

Other assets

 

209,435

 

207,986

TOTAL ASSETS

 

$         2,148,431

 

$         2,093,976

LIABILITIES, TEMPORARY EQUITY AND STOCKHOLDERS' EQUITY

   

Accounts payable and accrued expenses

 

$            89,829

 

$           111,947

Advance premiums

 

50,108

 

28,287

Due to insurers

 

27,100

 

94,930

Losses payable and reserves for unpaid losses and loss adjustment expenses

 

241,705

 

264,204

Unearned premiums

 

598,217

 

412,058

Ceding commissions payable

 

6,133

 

86,165

Debt, net

 

215,951

 

177,907

Contract liabilities

 

50,841

 

46,450

Deferred tax liability

 

244

 

23,489

Tax receivable agreement liability

 

38,284

 

39,829

Other liabilities

 

95,213

 

61,684

TOTAL LIABILITIES

 

1,413,625

 

1,346,950

Commitments and Contingencies

 

—

 

—

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 June 30, 2026 and December 31, 2025) 1

84,996

 

86,618

STOCKHOLDERS' EQUITY

    

Class A Common Stock, $0.0001 par value (500,000,000 shares authorized, 101,804,938 and
100,706,893 issued and outstanding as of June 30, 2026 and December 31, 2025, respectively)

10

 

10

Class V Common Stock, $0.0001 par value (300,000,000 authorized, 241,552,156 shares
issued and outstanding as of June 30, 2026 and December 31, 2025)

24

 

24

Additional paid-in capital

 

623,664

 

623,013

Accumulated earnings (deficit)

 

(407,171)

 

(402,960)

Accumulated other comprehensive income (loss)

 

(1,068)

 

1,229

Total stockholders' equity

 

215,459

 

221,316

Non-controlling interest

 

434,351

 

439,092

Total equity

 

649,810

 

660,408

TOTAL LIABILITIES, TEMPORARY EQUITY AND STOCKHOLDERS' EQUITY

$         2,148,431

 

$         2,093,976

     

____________________

1 The Series A Convertible Preferred Stock is recorded within Temporary Equity because it has equity conversion and cash redemption features.

 

Hagerty, Inc.

Condensed Consolidated Statements of Cash Flows (Unaudited)

 
 

Six months ended June 30,

 

2026

 

2025

    

OPERATING ACTIVITIES:

in thousands

Net income (loss)

$            (4,704)

 

$            74,495

Adjustments to reconcile net income (loss) to net cash from operating activities:

   

Loss on disposals of equipment, software, and other assets

241

 

1,211

Change in TRA Liability

—

 

3,078

Depreciation and amortization

19,422

 

18,321

Provision for deferred taxes

(26,199)

 

2,061

Share-based compensation expense

9,710

 

9,538

Non-cash lease expense

4,174

 

4,226

Net investment gains

(4,890)

 

(879)

(Accretion) amortization of discount and premium, net

(1,377)

 

(2,316)

Amortization of gain on loss portfolio transfer

(2,940)

 

—

Other

795

 

355

Changes in assets and liabilities:

   

Accounts and premiums receivable

128,383

 

(142,560)

Deferred acquisition costs, net

79,028

 

(21,964)

Reinsurance recoverables

2,950

 

(10,390)

Prepaid reinsurance premiums

(27,896)

 

(7,325)

Advance premiums

21,920

 

10,590

Due to insurers

(67,278)

 

68,256

Losses payable and reserves for unpaid losses and loss adjustment expenses

(22,499)

 

(7,828)

Unearned premiums

186,159

 

52,957

Ceding commissions payable

(80,032)

 

35,691

Other assets and liabilities, net

(28,810)

 

10,197

Net Cash Provided by Operating Activities

186,157

 

97,714

INVESTING ACTIVITIES:

   

Capital expenditures

(15,954)

 

(11,549)

Issuance of notes receivable

(92,151)

 

(26,617)

Collection of notes receivable

55,261

 

8,091

Purchases of fixed maturity securities

(228,418)

 

(98,455)

Purchases of equity securities

(51,041)

 

(347)

Proceeds from maturities and sales of fixed maturity securities

214,809

 

96,811

Proceeds from sales of equity securities

35,405

 

378

Other investing activities

(613)

 

(151)

Net Cash Used in Investing Activities

(82,702)

 

(31,839)

FINANCING ACTIVITIES:

   

Repayments of debt

(61,806)

 

(124,493)

Proceeds from debt, net of issuance costs

100,825

 

192,339

Proceeds from loss portfolio transfer

50,500

 

—

Claims payments made from loss portfolio transfer

(13,259)

 

—

Distributions paid to non-controlling interest unit holders

(837)

 

(30,380)

Payment of Series A Convertible Preferred Stock dividends

(5,600)

 

(5,600)

Funding of TRA Liability payments

(1,545)

 

(223)

Funding of employee tax obligations upon vesting of share-based payments

(3,251)

 

(2,452)

Other financing activities

309

 

289

Net Cash Provided by Financing Activities

65,336

 

29,480

Effect of exchange rate changes on cash and cash equivalents and restricted cash and cash equivalents

(156)

 

2,386

    

Change in cash and cash equivalents and restricted cash and cash equivalents

168,635

 

97,741

Beginning cash and cash equivalents and restricted cash and cash equivalents

299,000

 

232,845

Ending cash and cash equivalents and restricted cash and cash equivalents

$          467,635

 

$          330,586

Key Performance Indicators and Non-GAAP Financial Measures

Key Performance Indicators

The tables below present a summary of our Key Performance Indicators, which include important operational metrics, as well as certain financial measures prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") and non-GAAP financial measures. We use these Key Performance Indicators to evaluate our business, measure our performance, identify trends against planned initiatives, prepare financial projections, and make strategic decisions. We believe these Key Performance Indicators are useful in evaluating our performance when read together with our Condensed Consolidated Financial Statements prepared in accordance with GAAP.

  

Three months ended June 30,

  

2026

 

2025

 

Change

         

GAAP Financial Measures

 

dollars in thousands (except per share amounts)

Total revenue 1

 

$   354,822

 

$  379,309

 

$   (24,487)

 

(6.5) %

Income before taxes

 

$       2,232

 

$    53,363

 

$   (51,131)

 

(95.8) %

Net income

 

$       8,041

 

$    47,202

 

$   (39,161)

 

(83.0) %

Net income (loss) attributable to Class A Common 
Stockholders

$     (1,668)

 

$      9,098

 

$   (10,766)

 

(118.3) %

Basic earnings (loss) per share ("EPS")

 

$       (0.02)

 

$        0.09

 

$       (0.11)

 

(122.2) %

Diluted EPS

 

$       (0.02)

 

$        0.09

 

$       (0.11)

 

(122.2) %

         

Non-GAAP Financial Measures

        

Adjusted EBITDA

 

$    74,505

 

$    72,645

 

$      1,860

 

2.6 %

Adjusted Net Income (Loss)

 

$     (6,188)

 

$    43,450

 

$   (49,638)

 

(114.2) %

Adjusted Diluted EPS

 

$       (0.02)

 

$        0.12

 

$       (0.14)

 

(116.7) %

         

Insurance Operational Metrics

        

Total Written Premium

 

$   424,502

 

$   355,985

 

$    68,517

 

19.2 %

Net Assumed Premium

 

$   333,152

 

$   236,603

 

$    96,549

 

40.8 %

Hagerty Re Loss Ratio

 

42.7 %

 

42.3 %

 

0.4 %

 

N/M

Hagerty Re Combined Ratio

 

89.6 %

 

89.6 %

 

— %

 

N/M

New Business Count — Insurance

 

166,951

 

87,872

 

79,079

 

90.0 %

         

Marketplace Operational Metrics

        

Aggregate Auction Sales

 

$   104,446

 

$    49,408

 

$    55,038

 

111.4 %

Net Auction Sales

 

$     94,374

 

$    44,837

 

$    49,537

 

110.5 %

Private Sales

 

$     44,136

 

$  114,776

 

$   (70,640)

 

(61.5) %

BAC Average Loan Portfolio

 

$   146,363

 

$    81,233

 

$    65,130

 

80.2 %

         

____________________

N/M = Not meaningful

1

Total Revenue for the three months ended June 30, 2025 has been recast to include "Net investment income" and "Net investment gains" as components of revenue in accordance with the Article 7 reporting standards adopted in 2025. Total revenue as previously presented in accordance with Article 5 was $369 million for the three months ended June 30, 2025.

 

  

Six months ended June 30,

  

2026

 

2025

 

Change

         

GAAP Financial Measures

 

dollars in thousands (except per share amounts)

Total revenue 1

 

$  666,652

 

$  707,645

 

$    (40,993)

 

(5.8) %

Income (loss) before taxes

 

$   (18,705)

 

$    86,145

 

$  (104,850)

 

(121.7) %

Net income (loss)

 

$     (4,704)

 

$    74,495

 

$    (79,199)

 

(106.3) %

Net income (loss) attributable to Class A Common 
Stockholders

$    (8,189)

 

$    15,594

 

$   (23,783)

 

(152.5) %

Basic EPS

 

$      (0.08)

 

$        0.16

 

$       (0.24)

 

(150.0) %

Diluted EPS

 

$      (0.08)

 

$        0.16

 

$       (0.24)

 

(150.0) %

         

Non-GAAP Financial Measures

        

Adjusted EBITDA

 

$  159,690

 

$  120,796

 

$    38,894

 

32.2 %

Adjusted Net Income (Loss)

 

$   (19,332)

 

$    68,802

 

$   (88,134)

 

(128.1) %

Adjusted Diluted EPS

 

$       (0.05)

 

$        0.19

 

$       (0.24)

 

(126.3) %

         

Insurance Operational Metrics

        

Total Written Premium

 

$   713,448

 

$   600,312

 

$   113,136

 

18.8 %

Net Assumed Premium

 

$   650,498

 

$   392,254

 

$   258,244

 

65.8 %

Hagerty Re Loss Ratio

 

40.6 %

 

42.2 %

 

(1.6) %

 

N/M

Hagerty Re Combined Ratio

 

88.1 %

 

89.1 %

 

(1.0) %

 

N/M

New Business Count — Insurance

 

278,847

 

143,181

 

135,666

 

94.8 %

         

Marketplace Operational Metrics

        

Aggregate Auction Sales

 

$   239,825

 

$   124,744

 

$   115,081

 

92.3 %

Net Auction Sales

 

$   217,810

 

$   113,050

 

$  104,760

 

92.7 %

Private Sales

 

$     80,966

 

$   168,445

 

$   (87,479)

 

(51.9) %

BAC Average Loan Portfolio

 

$   141,472

 

$     72,009

 

$    69,463

 

96.5 %

         

____________________

N/M = Not meaningful

1

Total Revenue for the six months ended June 30, 2025 has been recast to include "Net investment income" and "Net investment gains" as components of revenue in accordance with the Article 7 reporting standards adopted in 2025. Total revenue as previously presented in accordance with Article 5 was $688 million for the six months ended June 30, 2025.

 

  

June 30,

  

2026

 

2025

 

Change

         

Insurance Operational Metrics

 

dollars in thousands

Policies in Force

 

1,855,649

 

1,559,798

 

295,851

 

19.0 %

Policies in Force Retention

 

88.2 %

 

88.7 %

 

(0.5) %

 

N/M

Vehicles in Force

 

3,031,566

 

2,664,611

 

366,955

 

13.8 %

HDC Paid Member Count

 

961,929

 

907,963

 

53,966

 

5.9 %

Marketplace Operational Metrics

        

BAC Loan Portfolio Balance

 

$   146,550

 

$    84,515

 

$    62,035

 

73.4 %

         

____________________

N/M = Not meaningful

Adjusted EBITDA

We define EBITDA as consolidated Net income (loss), excluding Interest expense and other, net, Income tax expense (benefit), and Depreciation and amortization. We define Adjusted EBITDA as EBITDA, further adjusted to (i) exclude net investment gains and losses; (ii) deduct interest expense related to the State Farm Term Loan; (iii) exclude share-based compensation expense; and when applicable, exclude (iv) restructuring, impairment and related charges; (v) gains, losses and impairments related to divestitures; and (vi) certain other unusual items, such as Markel Fronting Arrangement transitional costs during the three and six months ended June 30, 2026.

How This Measure is Useful

When used in conjunction with GAAP financial measures, Adjusted EBITDA is a supplemental measure of operating performance that we believe is a useful measure to evaluate our performance period over period and relative to our competitors and peers. Management uses Adjusted EBITDA to evaluate our operating performance on a consistent basis, as it removes the impact of items not directly resulting from our core operations. We believe the presentation of Adjusted EBITDA provides securities analysts, investors, and other interested parties with a supplemental view of our operating performance that enhances their understanding of our business and our results of operations, as well as assisting investors in evaluating how well we are executing our strategic initiatives.

Limitations of the Usefulness of This Measure

Adjusted EBITDA may differ from similarly titled measures used by other companies due to different methods of calculation, which could reduce the usefulness of this non-GAAP financial measure when comparing our performance to that of other companies. Presentation of Adjusted EBITDA should not be considered in isolation or a substitute for, or superior to, the financial information prepared in accordance with GAAP. A reconciliation of Adjusted EBITDA to Net income (loss), the most directly comparable GAAP measure, is presented below.

  

Three months ended

June 30,

 

Six months ended

June 30,

  

2026

 

2025

 

2026

 

2025

         
  

in thousands

Net income (loss)

$       8,041

 

$      47,202

 

$      (4,704)

 

$      74,495

Interest expense and other, net 1

28

 

4,946

 

950

 

6,635

Income tax expense (benefit)

(5,809)

 

6,161

 

(14,001)

 

11,650

Depreciation and amortization

9,716

 

8,833

 

19,422

 

18,321

EBITDA

11,976

 

67,142

 

1,667

 

111,101

Net investment gains

(7,179)

 

(1,194)

 

(4,890)

 

(879)

Interest expense related to State Farm Term Loan 2

(515)

 

(515)

 

(1,030)

 

(1,030)

Share-based compensation expense

5,093

 

5,146

 

9,710

 

9,538

Markel Fronting Arrangement transitional costs 3

64,111

 

—

 

153,069

 

—

Other unusual items 4

1,019

 

2,066

 

1,164

 

2,066

Adjusted EBITDA

$      74,505

 

$      72,645

 

$    159,690

 

$    120,796

         

____________________

1

Excludes interest expense related to the BAC Credit Facility, which is recorded within "Selling, general, and administrative expenses" in the Condensed Consolidated Statements of Operations.

2

Interest expense related to the State Farm Term Loan is charged against Adjusted EBITDA as it is directly attributable to the operations of Hagerty Re.

3

Represents the amortization of deferred ceding commissions paid to Markel for policies written prior to January 1, 2026. These costs relate exclusively to policies written prior to our entry into the Markel Fronting Arrangement and are being fully amortized ratably over the remaining term of those policies through December 31, 2026. The amortization of these deferred ceding commissions was $89 million in the first quarter of 2026, $64 million in the second quarter of 2026, and we expect it to decline to approximately $37 million in the third quarter of 2026 and approximately $9 million in the fourth quarter of 2026 as the remaining 2025 policy terms run off. Management excludes these costs from Adjusted EBITDA because they are transitional charges related solely to deferred ceding commissions on policies written prior to January 1, 2026, are expected to run off by December 31, 2026, and are not indicative of our ongoing operating performance under the Markel Fronting Arrangement.

4

For the three months ended June 30, 2026, other unusual items includes professional fees related to the pending acquisition of Bennetts. For the six months ended June 30, 2026, other unusual items includes professional fees related to the pending acquisition of Bennetts and additional severance expenses associated with the actions taken in the fourth quarter of 2025. For the three and six months ended June 30, 2025, other unusual items includes certain legal settlement expenses, professional fees associated with the THG Unit Exchange and related secondary offering, and certain material severance expenses.

As a result of our transition to Article 7 reporting standards, Net investment income is reported as a component of revenue and is no longer an adjustment in our reconciliation from Net income (loss) to Adjusted EBITDA. In addition, interest expense related to the State Farm Term Loan is now deducted from Adjusted EBITDA as it is directly attributable to Hagerty Re, which generates a significant portion of our net investment income. The following table presents a reconciliation of Adjusted EBITDA as presented in the prior period in accordance with Article 5, to the current presentation in accordance with Article 7:

 

Three months ended

 

Six months ended

 

June 30, 2025

 

June 30, 2025

    
 

in thousands

Prior presentation of Adjusted EBITDA

$                 63,744

 

$              103,352

Net investment income

9,416

 

18,474

Interest expense related to State Farm Term Loan

(515)

 

(1,030)

Current presentation of Adjusted EBITDA

$                72,645

 

$              120,796

The following table reconciles Adjusted EBITDA for the year ended December 31, 2026 Outlook to the most directly comparable GAAP measure, which is Net income:

  

2026 Low

 

2026 High

     
  

in thousands

Net income

$           18,000

 

$          30,000

Interest expense and other, net 1

5,000

 

5,000

Income tax benefit

(11,000)

 

(13,000)

Depreciation and amortization

40,000

 

40,000

Share-based compensation expense

19,000

 

19,000

Markel Fronting Arrangement transitional costs 2

199,000

 

199,000

Adjusted EBITDA

$         270,000

 

$         280,000

     

____________________

1

Excludes interest expense related to the BAC Credit Facility, which is recorded within "Selling, general, and administrative expenses" in the Condensed Consolidated Statements of Operations.

2

Represents the amortization of deferred ceding commissions paid to Markel for policies written prior to January 1, 2026. These costs relate exclusively to policies written prior to our entry into the Markel Fronting Arrangement and are being fully amortized ratably over the remaining term of those policies through December 31, 2026. The amortization of these deferred ceding commissions was $89 million in the first quarter of 2026, $64 million in the second quarter of 2026, and we expect it to decline to approximately $37 million in the third quarter of 2026 and approximately $9 million in the fourth quarter of 2026 as the remaining 2025 policy terms run off. Management excludes these costs from Adjusted EBITDA because they are transitional charges related solely to deferred ceding commissions on policies written prior to January 1, 2026, are expected to run off by December 31, 2026, and are not indicative of our ongoing operating performance under the Markel Fronting Arrangement.

Adjusted Net Income (Loss) and Adjusted Diluted EPS

Adjusted Net Income (Loss) represents Net income (loss) attributable to Class A Common Stockholders, assuming the full exchange of all outstanding THG units and Series A Convertible Preferred Stock for shares of Class A Common Stock, adjusted to exclude (i) net investment gains and losses; and when applicable, (ii) changes in the TRA Liability; (iii) gains and losses related to divestitures; and (iv) certain other unusual items. Adjusted Diluted EPS is calculated by dividing Adjusted Net Income (Loss) by the weighted average shares of Class A Common Stock outstanding, assuming the full exchange of all outstanding THG units, Series A Convertible Preferred Stock, and unvested share-based compensation awards.

How These Measures Are Useful

When used in conjunction with GAAP financial measures, Adjusted Net Income (Loss) and Adjusted Diluted EPS are supplemental measures of operating performance that we believe are useful measures to evaluate our performance period over period and relative to our competitors and peers. Management uses Adjusted Net Income (Loss) and Adjusted Diluted EPS to evaluate our operating performance on a consistent basis, as it removes the impact of items not directly resulting from our core operations. We believe these measures provide securities analysts, investors, and other interested parties with a supplemental view of our operating performance that enhances their understanding of our business and results of operations that may not otherwise be apparent when relying solely on GAAP measures. By assuming the full exchange of all outstanding THG units and Series A Convertible Preferred Stock, we believe these measures facilitate comparisons with other companies that have different organizational and tax structures, as well as comparisons period over period because it eliminates the effect of any changes in Net income (loss) attributable to Class A Common Stockholders driven by increases in Hagerty, Inc.'s ownership in THG, which is unrelated to our operating performance, and excludes items that are unusual or may not be indicative of our ongoing performance.

Limitations of the Usefulness of These Measures

Adjusted Net Income (Loss) and Adjusted Diluted EPS may differ from similarly titled measures used by other companies due to different methods of calculation, which could reduce the usefulness of this non-GAAP financial measure when comparing our performance to that of other companies. Presentation of Adjusted Net Income (Loss) and Adjusted Diluted EPS should not be considered in isolation or a substitute for, or superior to, the financial information prepared in accordance with GAAP. While these measures are useful in evaluating our performance, they assume the full exchange of all outstanding THG units and Series A Convertible Preferred Stock for shares of Class A Common Stock, which has not occurred and may not occur. Further, the adjustments made to arrive at Adjusted Net Income (Loss) exclude certain expenses and income that may recur in the future. Adjusted Net Income (Loss) and Adjusted Diluted EPS should be evaluated in conjunction with our GAAP financial results. A reconciliation of Adjusted Net Income (Loss) to Net income (loss) attributable to Class A Common Stockholders, the most directly comparable GAAP measure, and the computation of Adjusted Diluted EPS are presented below.

  

Three months ended

June 30,

 

Six months ended

June 30,

  

2026

 

2025

 

2026

 

2025

         

Numerator:

 

in thousands (except per share amounts)

Net income (loss) attributable to Class A Common 
Stockholders

$      (1,668)

 

$       9,098

 

$      (8,189)

 

$      15,594

Adjustments:

        

Accretion of Series A Convertible Preferred Stock

1,948

 

1,875

 

3,978

 

3,750

Net income (loss) attributable to non-controlling interest

7,761

 

36,229

 

(493)

 

55,151

Net investment gains

 

(7,179)

 

(1,194)

 

(4,890)

 

(879)

Change in TRA Liability

 

—

 

3,078

 

—

 

3,078

Other unusual items 1

 

1,019

 

2,066

 

1,164

 

2,066

Tax impact of above adjustments 2

 

(8,069)

 

(7,702)

 

(10,902)

 

(9,958)

Adjusted Net Income (Loss)

 

$      (6,188)

 

$      43,450

 

$    (19,332)

 

$      68,802

         

Denominator:

        

Weighted average shares of Class A Common Stock 
outstanding — Diluted

101,797

 

90,698

 

101,418

 

91,247

Adjustments:

       

Assumed exchange of non-controlling interest THG units 
for shares of Class A Common Stock

245,001

 

255,105

 

245,051

 

255,138

Assumed conversion of shares of Series A Convertible 
Preferred Stock into shares of Class A Common Stock

6,785

 

6,785

 

6,785

 

6,785

Assumed vesting of share-based compensation awards

7,951

 

8,580

 

7,979

 

7,404

Adjusted weighted average shares of Class A Common Stock
outstanding — Diluted

361,534

 

361,168

 

361,233

 

360,574

         

Adjusted Diluted EPS

 

$       (0.02)

 

$         0.12

 

$       (0.05)

 

$         0.19

 
  

Three months ended

June 30,

 

Six months ended

June 30,

  

2026

 

2025

 

2026

 

2025

         

Diluted EPS

 

$       (0.02)

 

$         0.09

 

$       (0.08)

 

$         0.16

Impact of assumed exchange, conversion, or vesting of
remaining potentially dilutive securities 3

0.04

 

0.04

 

0.07

 

0.05

Non-GAAP adjustments 4

(0.04)

 

(0.01)

 

(0.04)

 

(0.02)

Adjusted Diluted EPS

$       (0.02)

 

$         0.12

 

$       (0.05)

 

$         0.19

         

____________________

1

For the three months ended June 30, 2026, other unusual items includes professional fees related to the pending acquisition of Bennetts. For the six months ended June 30, 2026, other unusual items includes professional fees related to the pending acquisition of Bennetts and additional severance expenses associated with the actions taken in the fourth quarter of 2025. For the three and six months ended June 30, 2025, other unusual items includes certain legal settlement expenses, professional fees associated with the THG Unit Exchange and related secondary offering, and certain material severance expenses.

2

Represents the tax effect of the aforementioned adjustments to reflect corporate income taxes at an estimated effective tax rate of (58.0)% and 24.2% for the three months ended June 30, 2026 and 2025, respectively, and 13.8% and 23.9% for the six months ended June 30, 2026 and 2025, respectively, which considers the U.S. federal statutory rate of 21%, a combined state income tax rate of approximately 5% (net of federal benefits and required valuation allowances), and certain material permanent items.

3

Assumes the exchange of all outstanding THG units, Series A Convertible Preferred Stock, and unvested share-based compensation awards for shares of Class A Common Stock, resulting in the elimination of the non-controlling interest and recognition of the Net income (loss) attributable to non-controlling interest, as well as elimination of the accretion of Series A Convertible Preferred Stock.

4

Represents the per share impact of non-GAAP adjustments for each period. Refer to the reconciliation above for additional information.

Comparability Bridge

Due to the expanded underwriting and claims authority granted to us under the Markel Fronting Arrangement, we now control the Essentia book of business. While our U.S. MGA subsidiary and Hagerty Re continue to operate in the same manner they have historically, beginning on January 1, 2026, the benefit of our MGA services is being received by Hagerty Re and not Essentia. As a result, effective in the first quarter of 2026, we are no longer recognizing commission revenue or the associated ceding commission expense for Essentia-originated policies in our Condensed Consolidated Financial Statements. However, ceding commission expense associated with Essentia policies issued in 2025 will continue to be recognized ratably over the remaining term of those policies throughout 2026. In addition, policy acquisition costs incurred by our U.S. MGA subsidiary for Essentia policies issued in 2026 are being deferred and amortized over the policy term. Accordingly, our entry into the Markel Fronting Arrangement has reduced the period‑to‑period comparability of our Condensed Consolidated Financial Statements.

The following table provides a reconciliation of the standalone results of operations for our Hagerty Re and MGA+ reporting units for the three months ended June 30, 2026, which reflect the continuing operations of those businesses, to total insurance segment results of operations included in our Condensed Consolidated Statements of Operations:

 

Three months ended June 30, 2026

 
 

Hagerty Re:

Essentia 
Policy Year 
2025 (a)

 

Hagerty Re:

Essentia 
Policy Year 
2026 & Other 
Carriers (b)

 

Hagerty Re 
Total

 

MGA+ (c)

 

Consolidation 
Entries

 

Insurance 
Segment

 
             

REVENUES:

in thousands

 

Earned premium, net

$     157,365

 

$      94,591

 

$     251,956

 

$           —

 

$           —

 

$     251,956

 

Commission and fee revenue

    

—

 

167,213

 

(143,548)

(e)

23,665

 

Membership and other revenue

    

—

 

21,361

 

—

 

21,361

 

Net investment income

    

9,694

 

1,037

 

—

 

10,731

 

Net investment gains

    

7,179

 

—

 

—

 

7,179

 

Total revenue

    

268,829

 

189,611

 

(143,548)

 

314,892

 

EXPENSES:

            

Losses and loss adjustment expenses, net

    

107,522

 

3,187

(d)

—

 

110,709

 

Policy acquisition costs, net:

            

Ceding commission expense

71,614

 

38,959

 

110,573

 

—

 

(43,647)

(e)

66,926

 

Other policy acquisition costs

    

4,560

 

—

 

12,155

(f)

16,715

 

Underwriting and other insurance expenses

    

2,990

 

92,037

(d)

(32,080)

(f)

62,947

 

Selling, general, and administrative expenses

    

—

 

55,931

 

—

 

55,931

 

Interest expense and other, net

    

(1,118)

 

15

 

—

 

(1,103)

 

Total expenses

    

224,527

 

151,170

 

(63,572)

 

312,125

 

INCOME BEFORE TAXES

    

$      44,302

 

$      38,441

 

$     (79,976)

 

$       2,767

(g)

             

____________________

(a)

Represents Hagerty Re's earned premium and associated policy acquisition costs related to Essentia policies issued in 2025.

(b)

Represents Hagerty Re's earned premium and associated policy acquisition costs related to Essentia policies issued in 2026 and through other carriers.

(c)

The MGA+ reporting unit includes our MGA operations, as well as our membership, events, and media activities.

(d)

Our MGA subsidiaries incur costs to fulfill certain underwriting and claims handling functions on behalf of Hagerty Re, for which they are compensated through an intercompany commission paid by Hagerty Re. These costs are reflected within the standalone results of our MGA+ reporting unit within "Losses and loss adjustment expenses, net" and "Underwriting and other insurance expenses".

(e)

These consolidation entries are made to eliminate intercompany commission revenue and ceding commission expense between the Hagerty Re and MGA+ reporting units.

(f)

These consolidation entries are made to defer $32.1 million in policy acquisition costs incurred by the MGA+ reporting unit in their standalone results of operations, which are then amortized over the underlying policy term in our Condensed Consolidated Statements of Operations. For the three months ended June 30, 2026, the amortization of such deferred policy acquisition costs totaled $12.2 million.

(g)

This table is presented solely to improve the year-over-year comparability of our financial statements and should not be viewed on a standalone basis. It should be read together with our Condensed Consolidated Statements of Operations and the accompanying notes.

The following table provides a reconciliation of the standalone results of operations for our Hagerty Re and MGA+ reporting units for the six months ended June 30, 2026, which reflect the continuing operations of those businesses, to our Condensed Consolidated Statements of Operations. This table is presented solely to improve the year-over-year comparability of our financial statements and should not be viewed on a standalone basis. It should be read together with our Condensed Consolidated Statements of Operations and the accompanying notes.

 

Six months ended June 30, 2026

 
 

Hagerty Re:

Essentia 
Policy Year 
2025 (a)

 

Hagerty Re:

Essentia 
Policy Year 
2026 & Other 
Carriers (b)

 

Hagerty Re
Total

 

MGA+ (c)

 

Consolidation 
Entries

 

Insurance 
Segment

 
             

REVENUES:

in thousands

 

Earned premium, net

$     375,638

 

$     115,960

 

$     491,598

 

$           —

 

$           —

 

$     491,598

 

Commission and fee revenue

    

—

 

287,449

 

(247,349)

(e)

40,100

 

Membership and other revenue

    

—

 

43,488

 

—

 

43,488

 

Net investment income

    

18,926

 

1,819

 

—

 

20,745

 

Net investment gains

    

4,890

 

—

 

—

 

4,890

 

Total revenue

    

515,414

 

332,756

 

(247,349)

 

600,821

 

EXPENSES:

            

Losses and loss adjustment 
expenses, net

    

199,487

 

9,141

(d)

—

 

208,628

 

Policy acquisition costs, net:

            

Ceding commission expense

170,971

 

47,700

 

218,671

 

—

 

(55,188)

(e)

163,483

 

Other policy acquisition costs

    

5,787

 

—

 

16,293

(f)

22,080

 

Underwriting and other 
insurance expenses

    

9,040

 

170,740

(d)

(57,245)

(f)

122,535

 

Selling, general, and 
administrative expenses

    

—

 

102,797

 

—

 

102,797

 

Interest expense and other, net

    

(1,911)

 

792

 

—

 

(1,119)

 

Total expenses

    

431,074

 

283,470

 

(96,140)

 

618,404

 

INCOME (LOSS) BEFORE TAXES

    

$      84,340

 

$      49,286

 

$   (151,209)

 

$     (17,583)

(g)

             

____________________

(a)

Represents Hagerty Re's earned premium and associated policy acquisition costs related to Essentia policies issued in 2025.

(b)

Represents Hagerty Re's earned premium and associated policy acquisition costs related to Essentia policies issued in 2026 and through other carriers.

(c)

The MGA+ reporting unit includes our MGA operations, as well as our membership, events, and media activities.

(d)

Our MGA subsidiaries incur costs to fulfill certain underwriting and claims handling functions on behalf of Hagerty Re, for which they are compensated through an intercompany commission paid by Hagerty Re. These costs are reflected within the standalone results of our MGA+ reporting unit within "Losses and loss adjustment expenses, net" and "Underwriting and other insurance expenses".

(e)

These consolidation entries are made to eliminate intercompany commission revenue and ceding commission expense between the Hagerty Re and MGA+ reporting units.

(f)

These consolidation entries are made to defer $57.2 million in policy acquisition costs incurred by the MGA+ reporting unit in their standalone results of operations, which are then amortized over the underlying policy term in our Condensed Consolidated Statements of Operations. For the six months ended June 30, 2026, the amortization of such deferred policy acquisition costs totaled $16.3 million.

(g)

This table is presented solely to improve the year-over-year comparability of our financial statements and should not be viewed on a standalone basis. It should be read together with our Condensed Consolidated Statements of Operations and the accompanying notes.

 

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SOURCE Hagerty

Hagerty Investor: Investor@hagerty.com, Hagerty Media: Press@hagerty.com