Hagerty Reports Second Quarter 2026 Results

 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 Income^{3, 4}

$149,225

$(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.

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

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

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.

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

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.

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.

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.

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)