Cover Page - USD ($) $ in Millions	12 Months Ended
Cover Page - USD ($) $ in Millions	Dec. 31, 2024	Feb. 20, 2025	Jun. 30, 2024
Document Information [Line Items]
Document Type	10-K
Document Annual Report	true
Current Fiscal Year End Date	--12-31
Document Period End Date	Dec. 31, 2024
Document Transition Report	false
Entity File Number	001-40244
Entity Registrant Name	HAGERTY, INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	86-1213144
Entity Address, Address Line One	121 Drivers Edge
Entity Address, City or Town	Traverse City
Entity Address, State or Province	MI
Entity Address, Postal Zip Code	49684
City Area Code	(800)
Local Phone Number	922-4050
Title of 12(b) Security	Class A common stock, par value $0.0001 per share
Trading Symbol	HGTY
Security Exchange Name	NYSE
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
ICFR Auditor Attestation Flag	false
Document Financial Statement Error Correction [Flag]	false
Entity Shell Company	false
Entity Public Float			$ 296.6
Documents Incorporated by Reference	Portions of the registrant's definitive Proxy Statement for its 2025 Annual Meeting of Stockholders, which will be filed with the Securities and Exchange Commission within 120 days of December 31, 2024, are incorporated by reference into Part III, Items 10-14 of this Annual Report on Form 10-K.
CIK	0001840776
Amendment Flag	false
Fiscal Period Focus	FY
Fiscal Year Focus	2024
Class A Common Stock
Document Information [Line Items]
Entity Common Stock, Shares Outstanding (in shares)		90,040,663
Class V Common Stock
Document Information [Line Items]
Entity Common Stock, Shares Outstanding (in shares)		251,033,906

Audit Information	12 Months Ended
Audit Information	Dec. 31, 2024
Audit Information [Abstract]
Auditor Name	DELOITTE & TOUCHE LLP
Auditor Location	Detroit, Michigan
Auditor Firm ID	34

Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023	Dec. 31, 2022
REVENUE:
Earned premium	$ 643,324	$ 531,866	$ 403,061
Total revenue	1,200,038	1,000,213	787,588
OPERATING EXPENSES:
Salaries and benefits	221,463	216,896	199,542
Ceding commissions, net	301,719	251,805	191,150
Losses and loss adjustment expenses	298,593	220,658	182,402
Sales expense	190,523	156,378	140,781
General and administrative expenses	82,504	85,434	89,068
Depreciation and amortization	38,905	45,809	33,887
Restructuring, impairment and related charges, net	0	8,812	18,324
Gains, losses, and impairments related to divestitures	(87)	4,013	0
Total operating expenses	1,133,620	989,805	855,154
OPERATING INCOME (LOSS)	66,418	10,408	(67,566)
Gain (loss) related to warrant liabilities, net	(8,544)	11,543	41,899
Revaluation gain on previously held equity method investment	0	0	34,735
Interest and other income (expense), net	35,808	22,821	2,028
INCOME BEFORE INCOME TAX EXPENSE	93,682	44,772	11,096
Income tax expense	(15,379)	(16,593)	(7,017)
Loss from equity method investment, net of tax	0	0	(1,676)
NET INCOME	78,303	28,179	2,403
Net (income) loss attributable to non-controlling interest	(61,286)	(7,948)	29,675
Accretion of Series A Convertible Preferred Stock	(7,427)	(3,677)	0
NET INCOME ATTRIBUTABLE TO CLASS A COMMON STOCKHOLDERS	9,590	16,554	32,078
Class A Common Stock
OPERATING EXPENSES:
NET INCOME	78,303	28,179	2,403
Net (income) loss attributable to non-controlling interest	(61,286)	(7,948)	29,675
Accretion of Series A Convertible Preferred Stock	$ (7,427)	$ (3,677)	$ 0
Earnings (loss) per share of Class A Common Stock:
Basic (in dollars per share)	$ 0.10	$ 0.19	$ 0.39
Diluted (in dollars per share)	$ 0.10	$ 0.09	$ (0.07)
Weighted average shares of Class A Common Stock outstanding:
Basic (in shares)	87,529	84,180	82,728
Diluted (in shares)	88,504	340,323	336,147
Commission and fee revenue
REVENUE:
Revenue	$ 423,240	$ 365,512	$ 307,238
Membership, marketplace and other revenue
REVENUE:
Revenue	$ 133,474	$ 102,835	$ 77,289

Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023	Dec. 31, 2022
Statement of Comprehensive Income [Abstract]
Net income	$ 78,303	$ 28,179	$ 2,403
Other comprehensive income (loss), net of tax:
Change in net unrealized gain (loss) on available-for-sale investments	(770)	0	0
Foreign currency translation adjustments	(2,580)	1,564	(1,834)
Change in unrealized gain (loss) on interest rate swap	(2,234)	(1,060)	2,699
Other comprehensive income (loss)	(5,584)	504	865
Comprehensive income	72,719	28,683	3,268
Comprehensive (income) loss attributable to non-controlling interest	(57,128)	(8,327)	29,675
Accretion of Series A Convertible Preferred Stock	(7,427)	(3,677)	0
Comprehensive income attributable to Class A Common Stockholders	$ 8,164	$ 16,679	$ 32,943

Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 31, 2024	Dec. 31, 2023
Current Assets:
Cash and cash equivalents	$ 104,784	$ 108,326
Restricted cash and cash equivalents	128,061	615,950
Investments	73,957	10,946
Accounts receivable	84,763	71,530
Premiums receivable	153,748	137,525
Commissions receivable	20,430	79,115
Notes receivable	45,417	35,896
Deferred acquisition costs, net	156,466	141,637
Other current assets	90,779	49,293
Total current assets	858,405	1,250,218
Investments	515,570	5,526
Notes receivable	11,555	17,018
Property and equipment, net	18,205	20,764
Lease right-of-use assets	44,485	50,515
Intangible assets, net	90,107	91,924
Goodwill	114,123	114,214
Other long-term assets	56,888	38,033
TOTAL ASSETS	1,709,338	1,588,212
Current Liabilities:
Accounts payable, accrued expenses and other current liabilities	73,383	87,175
Losses payable	98,386	62,001
Provision for unpaid losses and loss adjustment expenses	168,492	136,507
Commissions payable	77,389	108,739
Advance premiums and due to insurers	108,352	100,286
Unearned premiums	357,539	317,275
Contract liabilities	31,905	30,316
Total current liabilities	915,446	842,299
Long-term lease liabilities	43,178	50,459
Long-term debt, net	104,968	130,680
Warrant liabilities	0	34,018
Deferred tax liability	18,065	15,937
Contract liabilities	15,334	17,335
Other long-term liabilities	4,178	4,139
TOTAL LIABILITIES	1,101,169	1,094,867
Commitments and Contingencies (Note 25)	0	0
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 December 31, 2024 and December 31, 2023)	84,663	82,836
STOCKHOLDERS' EQUITY
Additional paid-in capital	603,780	561,754
Accumulated earnings (deficit)	(451,978)	(468,995)
Accumulated other comprehensive income (loss)	(1,514)	(88)
Total stockholders' equity	150,322	92,704
Non-controlling interest	373,184	317,805
Total equity (Note 19)	523,506	410,509
TOTAL LIABILITIES, TEMPORARY EQUITY AND STOCKHOLDERS' EQUITY	1,709,338	1,588,212
Class A Common Stock
STOCKHOLDERS' EQUITY
Common stock	9	8
Additional paid-in capital	3,200	2,300
Class V Common Stock
STOCKHOLDERS' EQUITY
Common stock	$ 25	$ 25

Consolidated Balance Sheets (Parenthetical) - $ / shares	Dec. 31, 2024	Jul. 23, 2024	Jul. 05, 2024	Jul. 04, 2024	Dec. 31, 2023	Dec. 31, 2022
Temporary equity, par value (in dollars per share)	$ 0.0001				$ 0.0001
Temporary equity, shares authorized (in shares)	20,000,000				20,000,000
Temporary equity, shares issued (in shares)	8,483,561				8,483,561
Temporary equity, shares outstanding (in shares)	8,483,561				8,483,561
Common stock, shares, outstanding (in shares)	345,210,737				340,087,700
Class A Common Stock
Common stock, par value (in dollars per share)	$ 0.0001				$ 0.0001
Common stock, shares authorized (in shares)	500,000,000				500,000,000
Common stock, shares, issued (in shares)	90,032,391	3,876,201	3,686,056	189,438	84,588,536
Common stock, shares, outstanding (in shares)	90,032,391				84,588,536	83,202,969
Class V Common Stock
Common stock, par value (in dollars per share)	$ 0.0001				$ 0.0001
Common stock, shares authorized (in shares)	300,000,000				300,000,000
Common stock, shares, issued (in shares)	251,033,906				251,033,906
Common stock, shares, outstanding (in shares)	251,033,906				251,033,906

Consolidated Statements of Changes in Temporary Equity and Stockholders' Equity - USD ($) $ in Thousands	Total	Cumulative effect of adoption of ASU 842	Class A Common Stock	Class V Common Stock	Total Stockholders' Equity	Total Stockholders' Equity Cumulative effect of adoption of ASU 842	Series A Convertible Preferred Stock Series A Convertible Preferred Stock	Common stocks Class A Common Stock	Common stocks Class V Common Stock	Additional Paid in Capital	Accumulated Earnings (Deficit)	Accumulated Earnings (Deficit) Cumulative effect of adoption of ASU 842	Accumulated Other Comprehensive Income/(Loss)	Non-controlling Interest	Non-controlling Interest Cumulative effect of adoption of ASU 842	Non-controlling Interest Class A Common Stock
Temporary equity, beginning balance at Dec. 31, 2021	$ 593,277
Temporary Equity
Net income (loss) before exchange agreement amendment	(11,205)
Redemption value adjustment for redeemable non-controlling interest	1,560,418
Removal of the redeemable feature of the non-controlling interest	(2,142,490)
Temporary equity, ending balance (in shares) at Dec. 31, 2022							0
Temporary equity, ending balance at Dec. 31, 2022	0						$ 0
Beginning balance (in shares) at Dec. 31, 2021								82,327,000	251,034,000
Beginning balance at Dec. 31, 2021	(322,476)	$ 4,314			$ (323,781)	$ 1,066		$ 8	$ 25	$ 160,189	$ (482,276)	$ 1,066	$ (1,727)	$ 1,305	$ 3,248
Stockholders' Equity
Net income	2,403		$ 2,403
Net income (loss) before exchange agreement amendment	(3,851)				(3,679)						(3,679)			(172)
Other comprehensive income (loss)	865
Other comprehensive income before exchange agreement amendment	1,657				1,657								1,657
Redemption value adjustment for redeemable non-controlling interest	(1,560,420)				(1,560,420)					(162,095)	(1,398,325)
Net income (loss) after exchange agreement amendment	17,459				35,757						35,757			(18,298)
Removal of the redeemable feature of the non-controlling interest	2,142,490				1,926,940					528,615	1,398,325			215,550
Other comprehensive income (loss) after exchange agreement amendment	(792)				(792)								(792)
Exercise of warrants (in shares)								125,000
Exercise of warrants	1,906				1,906					1,906
Issuance of shares under employee plans (in shares)								37,000
Share-based compensation	12,129				12,129					12,129
Non-controlling interest capital issued	1,700													1,700
Broad Acquisition (in shares)								714,000
Broad Arrow Acquisition	73,253				9,613					9,613				63,640
Reallocation between controlling and non-controlling interest	0				(41,144)					(1,323)	(40,470)		649	$ 41,144
Ending balance (in shares) at Dec. 31, 2022			83,202,969					83,203,000	251,034,000					255,758,466
Ending balance at Dec. 31, 2022	367,369				59,252			$ 8	$ 25	549,034	(489,602)		(213)	$ 308,117
Temporary Equity
Issuance of Series A Preferred Convertible Stock, net of issuance costs (in shares)							8,484,000
Issuance of Series A Convertible Preferred Stock, net of issuance costs	$ 0						$ 79,159
Accretion of Series A Convertible Preferred Stock							$ 3,677
Temporary equity, ending balance (in shares) at Dec. 31, 2023	8,483,561						8,484,000
Temporary equity, ending balance at Dec. 31, 2023	$ 82,836						$ 82,836
Stockholders' Equity
Net income	28,179		$ 28,179		20,231						20,231			7,948
Accretion of Series A Convertible Preferred Stock	(3,677)				(3,677)					(3,677)
Other comprehensive income (loss)	504				125								125	379
Issuance of shares under employee plans, net of shares withheld for employee taxes (in shares)								1,126,000
Issuance of shares under employee plans, net of shares withheld for employee taxes	1,526				1,526					1,526
Issuance of shares under employee plans (in shares)			1,126,265
Share-based compensation	18,017				18,017					18,017
Warrant exchange (in shares)			0
Exchange of THG units for Class A Common Stock (in shares)			259,302					260,000								(259,302)
Exchange of THG units for Class A Common Stock	0				2,311					2,311				(2,311)
Non-controlling interest capital issued	779													779
Termination of MHH Joint Venture (see Note 11)	(2,188)				(662)					(1,038)	376			(1,526)
Reallocation between controlling and non-controlling interest	$ 0				(4,419)					(4,419)				$ 4,419
Ending balance (in shares) at Dec. 31, 2023	340,087,700		84,588,536	251,033,906				84,589,000	251,034,000					255,499,164
Ending balance at Dec. 31, 2023	$ 410,509				92,704			$ 8	$ 25	561,754	(468,995)		(88)	$ 317,805
Temporary Equity
Accretion of Series A Convertible Preferred Stock							7,427
Dividends related to Series A Convertible Preferred Stock							$ (5,600)
Temporary equity, ending balance (in shares) at Dec. 31, 2024	8,483,561						8,484,000
Temporary equity, ending balance at Dec. 31, 2024	$ 84,663						$ 84,663
Stockholders' Equity
Net income	78,303		$ 78,303		17,017						17,017			61,286
Accretion of Series A Convertible Preferred Stock	(7,427)				(7,427)					(7,427)
Other comprehensive income (loss)	(5,584)				(1,426)								(1,426)	(4,158)
Issuance of shares under employee plans, net of shares withheld for employee taxes (in shares)								1,247,000
Issuance of shares under employee plans, net of shares withheld for employee taxes	(5,539)				(5,539)					(5,539)
Issuance of shares under employee plans (in shares)			1,246,836
Share-based compensation	17,357				17,357					17,357
Warrant exchange (in shares)			3,876,201					3,876,000
Warrant exchange	42,570				42,570			$ 1		42,569
Exchange of THG units for Class A Common Stock (in shares)			320,818					320,000								(320,818)
Exchange of THG units for Class A Common Stock	0				3,227					3,227				(3,227)
Distributions paid to non-controlling interest unit holders	(6,683)													(6,683)
Reallocation between controlling and non-controlling interest	$ 0				(8,161)					(8,161)				$ 8,161
Ending balance (in shares) at Dec. 31, 2024	345,210,737		90,032,391	251,033,906				90,032,000	251,034,000					255,178,346
Ending balance at Dec. 31, 2024	$ 523,506				$ 150,322			$ 9	$ 25	$ 603,780	$ (451,978)		$ (1,514)	$ 373,184

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2024	Dec. 31, 2023	Dec. 31, 2022
OPERATING ACTIVITIES:
Net income	$ 78,303	$ 28,179	$ 2,403
Adjustments to reconcile net income to net cash from operating activities:
Revaluation gain on previously held equity method investment	0	0	(34,735)
Impairment of operating lease right-of-use assets	0	1,147	4,698
Loss on disposals of equipment, software and other assets	500	1,894	4,316
(Gain) loss related to warrant liabilities, net	8,544	(11,543)	(41,899)
Depreciation and amortization	38,905	45,809	33,887
Provision for deferred taxes	2,929	2,921	2,973
Share-based compensation expense	17,357	18,017	12,129
Non-cash lease expense	8,053	11,681	10,875
Realized (gain) loss on investments, net	(2,223)	0	0
(Accretion) amortization of discount and premium, net	(3,386)	34	196
Other	5,300	1,334	2,013
Changes in operating assets and liabilities:
Accounts, premiums and commissions receivable	26,498	(69,879)	(52,036)
Deferred acquisition costs, net	(14,829)	(34,295)	(25,807)
Losses payable	36,385	6,485	21,034
Provision for unpaid losses and loss adjustment expenses	31,985	24,766	36,872
Commissions payable	(31,350)	31,664	16,472
Advance premiums and due to insurers	8,418	14,880	13,686
Unearned premiums	40,264	81,813	60,263
Operating lease assets and liabilities	(9,036)	(11,243)	(9,779)
Other assets and liabilities, net (see Note 1)	(65,593)	(9,958)	(2,233)
Net Cash Provided by Operating Activities	177,024	133,706	55,328
INVESTING ACTIVITIES:
Capital expenditures	(21,344)	(26,403)	(44,375)
Acquisitions, net of cash acquired, and other investments	(25,120)	(8,683)	(15,404)
Purchase of previously held equity method investment	0	0	(15,250)
Issuance of note receivable to previously held equity method investment	0	0	(7,000)
Issuance of notes receivable	(65,770)	(24,939)	(6,123)
Collection of notes receivable	59,788	10,357	370
Purchases of fixed maturity securities	(669,452)	(10,568)	(4,234)
Proceeds from sales of fixed maturity securities	64,827	0	0
Proceeds from maturities of fixed maturity securities	48,389	7,468	1,216
Purchases of equity securities	(10,861)	0	0
Other investing activities	979	121	(721)
Net Cash Used in Investing Activities	(618,564)	(52,647)	(91,521)
FINANCING ACTIVITIES:
Payments on long-term debt	(90,775)	(139,850)	(122,500)
Proceeds from long-term debt, net of issuance costs	61,972	161,547	94,367
Proceeds from issuance of Series A Convertible Preferred Stock, net of issuance costs	0	79,159	0
Distributions paid to non-controlling interest unit holders	(6,683)	0	0
Payment of Series A Convertible Preferred Stock dividends	(5,600)	0	0
Funding of employee tax obligations upon vesting of share-based payments	(5,836)	0	0
Other financing activities	0	2,305	49
Net Cash Provided by (Used in) Financing Activities	(46,922)	103,161	(28,084)
Effect of exchange rate changes on cash and cash equivalents and restricted cash and cash equivalents	(2,969)	865	(504)
Change in cash and cash equivalents and restricted cash and cash equivalents	(491,431)	185,085	(64,781)
Beginning cash and cash equivalents and restricted cash and cash equivalents	724,276	539,191	603,972
Ending cash and cash equivalents and restricted cash and cash equivalents	$ 232,845	$ 724,276	$ 539,191

Summary of Significant Accounting Policies and New Accounting Standards

12 Months Ended

Dec. 31, 2024

Accounting Policies [Abstract]

Summary of Significant Accounting Policies and New Accounting Standards

1 — Summary of Significant Accounting Policies and New Accounting Standards

In these Notes to the Consolidated Financial Statements, the terms "Hagerty," and the "Company" refer to Hagerty, Inc. and its consolidated subsidiaries, including The Hagerty Group, LLC ("THG"), unless the context requires otherwise. In addition, the Company's insurance policyholders and paid Hagerty Drivers Club ("HDC") subscribers are collectively referred to as "Members".

Description of Business — Hagerty is a market leader in providing insurance for collector cars and enthusiast vehicles. Through Hagerty's insurance model, the Company acts as a Managing General Agent ("MGA") by underwriting, selling, and servicing collector car and enthusiast vehicle insurance policies. The Company then reinsures approximately 80% of the risks written by its MGA subsidiaries through its wholly owned subsidiary, Hagerty Reinsurance Limited ("Hagerty Re"). In addition, Hagerty offers HDC memberships, which are primarily bundled with its insurance policies and give subscribers access to an array of products and services, including emergency roadside assistance, Hagerty Drivers Club Magazine, automotive enthusiast events, Hagerty's proprietary vehicle valuation tool, and special vehicle-related discounts. The Company also offers a marketplace to complement its insurance membership offerings where automotive enthusiasts can buy, sell, and finance collector cars and enthusiast vehicles.

Basis of Presentation — The Consolidated Financial Statements are prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") and pursuant to the regulations of the Securities and Exchange Commission and include the accounts of Hagerty, Inc., which is comprised of THG and its consolidated subsidiaries.

The Consolidated Financial Statements reflect all normal recurring adjustments and accruals that are, in the opinion of management, necessary for a fair statement of the Company's financial position and results of operations for periods presented.

Principles of Consolidation — The Consolidated Financial Statements contain the accounts of Hagerty, Inc. and its majority-owned or controlled subsidiaries.

As of December 31, 2024 and 2023, Hagerty, Inc. had economic ownership of 26.1% and 24.9%, respectively, of THG and is its sole managing member. Hagerty, Inc. reports a non-controlling interest representing the economic interest in THG held by other parties.

The financial statements of THG are consolidated by the Company under the voting interest method in accordance with Accounting Standards Codification ("ASC") Topic 810, Consolidations ("ASC 810"). Non-controlling interest is presented separately on the Consolidated Statements of Operations, the Consolidated Statements of Comprehensive Income, the Consolidated Balance Sheets, and the Consolidated Statements of Changes in Temporary Equity and Stockholders' Equity.

All intercompany accounts and transactions have been eliminated in consolidation.

Variable Interest Entities — Broad Arrow Capital LLC ("BAC") and certain of its subsidiaries transfer notes receivable to wholly owned, bankruptcy-remote, special purpose entities (each, an "SPE") to secure borrowings under the BAC Credit Agreement (as defined in Note 17 — Long-Term Debt).

These SPEs are considered to be variable interest entities (each, a "VIE") under GAAP and their financial statements are consolidated by BAC, which is the primary beneficiary of the SPEs and also a consolidated subsidiary of the Company. BAC is considered to be the primary beneficiary of the SPEs because it has (i) power over the significant activities of the SPEs through its role as servicer of the notes receivable used to secure borrowings under the BAC Credit Agreement and (ii) the obligation to absorb losses or the right to receive returns that could be significant through its interest in the residual cash flows of the SPEs.

Refer to Note 5 — Notes Receivable and Note 17 — Long-Term Debt for additional information.

The following table presents the assets and liabilities of the Company's consolidated variable interest entities as of December 31, 2024 and 2023:


	December 31,		December 31,
	2024		2023

ASSETS	in thousands
Cash and cash equivalents	$	1,746	$	83
Restricted cash and cash equivalents	1,221		961
Accounts receivable	—		190
Notes receivable	49,337		30,125
Other assets	1,961		2,900
TOTAL ASSETS	$	54,265	$	34,259
LIABILITIES
Accounts payable, accrued expenses and other current liabilities	$	999	$	1,881
Long-term debt, net	30,193		25,782
TOTAL LIABILITIES	$	31,192	$	27,663

Emerging Growth Company — The Company currently qualifies as an "emerging growth company" under the Jumpstart Our Business Startups Act of 2012 and can delay the adoption of new or revised accounting standards until those standards would apply to private companies.

The Company intends to avail itself of this extended transition period and, therefore, the Company may not be subject to the same new or revised accounting standards as other public companies that are not emerging growth companies or have opted out of using such extended transition period. As of December 31, 2024, the Company has not delayed the adoption of any new or revised accounting standards despite qualifying as an emerging growth company.

Reclassifications — In conjunction with the Company's investment diversification in the second quarter of 2024, prior period fixed maturity investment balances have been reclassified from "Other current assets" and "Other long-term assets" to "Investments" on the Consolidated Balance Sheets to conform to the current year presentation. Refer to Note 3 — Investments for additional information related to the Company's investment portfolio. This reclassification had no effect on the Company's previously reported operating income, net income, earnings per share, cash flows, or retained earnings.

Use of Estimates — The preparation of the Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and the disclosure of contingent assets and liabilities as of the date of the Consolidated Financial Statements, as well as the reported amounts of revenue and expenses during the reporting period. Although the estimates are considered reasonable, actual results could materially differ from those estimates.

Significant estimates made by management include, but are not limited to: (i) the provision for unpaid losses and loss adjustment expenses, including incurred but not reported ("IBNR") claims (see Note 13); (ii) the valuation of the Company's deferred income tax assets (see Note 23); (iii) the amount of the liability associated with the Tax Receivable Agreement ("TRA") (see Note 23); (iv) the fair values of the reporting units used in assessing the recoverability of goodwill (see Note 12); (v) the valuation and useful lives of intangible assets (see Note 12); and (vi) the fair value of the Company's previous warrant liabilities (see Note 4 and Note 20). Although some variability is inherent in these estimates, management believes that the current estimates are reasonable in all material respects. These estimates are reviewed regularly and adjusted as necessary. Adjustments related to changes in estimates are reflected in the Company's results of operations in the period during which those estimates changed.

Segment Information — The Company has one operating segment and one reportable segment with the Chief Executive Officer ("CEO") acting as the Chief Operating Decision Maker ("CODM"). The Company's segment presentation reflects its business activities which place the automotive enthusiast at the center of operating and resource allocation decisions. Accordingly, the CODM evaluates performance and makes resource allocation decisions using a number of consolidated measures, including consolidated net income. The CODM is also regularly provided with information regarding the Company's significant expenses consistent with the level of information provided in the Consolidated Statements of Operations, as well as information regarding assets consistent with the level of detail provided in the Consolidated Balance Sheets. The CODM utilizes such consolidated financial information in connection with the Company's budgeting and forecasting process to monitor budget-to-actual variances when evaluating performance, allocating resources, and establishing management compensation.

Foreign Currency Translation — The functional currency of the Company's entities operating outside of the United States ("U.S.") is the principal currency of the economic environment in which the entity primarily generates and expends cash, which is generally the local currency. The Company translates its foreign currency denominated assets and liabilities into U.S. dollars at current rates of exchange as of the balance sheet date, and foreign currency denominated income and expense items at the average exchange rate for the reporting period. Translation adjustments resulting from exchange rate fluctuations are recorded in "Foreign currency translation adjustments", a component of "Accumulated other comprehensive income (loss)" on the Consolidated Balance Sheets. Foreign currency transaction gains and losses are recorded within "Interest and other income (expense), net" in the Consolidated Statements of Operations.

Cash and Cash Equivalents and Restricted Cash and Cash Equivalents — The Company holds unrestricted and restricted cash and cash equivalents at multiple financial institutions. The combined account balances at one or more of the institutions may exceed the Federal Depository Insurance Corporation ("FDIC") insurance coverage. The Company is subject to a concentration of credit risk related to amounts on deposit in excess of FDIC insurance coverage. The Company believes the risk is not significant given the size and credit worthiness of the financial institutions at which the funds are held. The Company considers all highly liquid investments convertible to a known amount of cash and with an original maturity of three months or less to be cash equivalents.

Cash and cash equivalents that are restricted as to withdrawal or use are recorded as restricted cash and cash equivalents. The carrying value of the Company's restricted cash and cash equivalents approximates fair value. Refer to "Restricted Assets" below for additional information regarding the Company's restricted cash and cash equivalent balances.

The following table provides a reconciliation of cash and cash equivalents and restricted cash and cash equivalents as of December 31, 2024 and 2023:


	December 31,
	2024		2023		2022

	in thousands
Cash and cash equivalents	$	104,784	$	108,326	$	95,172
Restricted cash and cash equivalents	128,061		615,950		444,019
Total cash and cash equivalents and restricted cash and cash equivalents	$	232,845	$	724,276	$	539,191

Investments — Fixed maturity securities are classified as available-for-sale and recorded on the Consolidated Balance Sheets at their fair value, with those having maturity dates within one year of the balance sheet date classified within current assets. On a quarterly basis, fixed maturity securities with unrealized losses are reviewed to determine whether the decline in fair value is attributable to a material credit loss. If a material credit loss is noted, an allowance is established and the credit loss is recorded in the Consolidated Statements of Operations.

Unrealized gains and losses on fixed maturity securities are recorded within "Change in net unrealized gain (loss) on available-for-sale investments", a component of "Accumulated other comprehensive income (loss)" on the Consolidated Balance Sheets. The Company uses the first in, first out method to determine the cost of the fixed maturity securities sold. Realized investment gains or losses from sales of available-for-sale investments are recorded within "Interest and other income (expense), net" in the Consolidated Statements of Operations.

Interest on fixed maturity securities is recorded within "Interest and other income (expense), net" in the Consolidated Statements of Operations. Premiums and discounts are amortized or accreted, respectively, over the lives of the related fixed maturity securities as an adjustment to the yield using the effective interest method.

Equity securities are recorded on the Consolidated Balance Sheets at their fair value and are classified within current assets. Dividend income, as well as realized and unrealized gains and losses on equity securities, are recorded within "Interest and other income (expense), net" in the Consolidated Statements of Operations.

Refer to Note 3 — Investments and Note 4 — Fair Value Measurements for additional information regarding the Company's investment portfolio.

Supplemental Balance Sheet Information

Restricted Assets — As discussed in more detail below, certain of the Company's subsidiaries hold assets in trust and/or that are restricted as to their use.

The Company's MGA subsidiaries collect premiums from insureds on behalf of insurance carriers. Prior to remittance to the insurance carrier, these funds are required to be held in trust for the benefit of the insurance carriers and segregated from the Company's operating cash.

Hagerty Re maintains trust accounts for the benefit of various ceding insurers as security for its obligations for losses, loss expenses, unearned premium, and profit-sharing commissions.

On September 1, 2024, the Company acquired Consolidated National Insurance Company, which was subsequently renamed Drivers Edge Insurance Company ("Drivers Edge"). Drivers Edge maintains assets on deposit with a number of regulatory authorities to support its insurance operations. Refer to Note 10 — Acquisitions for additional information related to the Company's acquisition of Drivers Edge.

BAC and its consolidated subsidiaries maintain bank accounts that are required for the operation of the BAC Credit Facility (as defined in Note 17 — Long-Term Debt). The funds in these bank accounts represent security under the BAC Credit Facility and their use is restricted to the servicing of the debt outstanding under that facility.

The following table presents the components of the Company's restricted assets as of December 31, 2024 and 2023:


	Balance Sheet Classification	December 31,
		2024		2023

		in thousands
Cash and cash equivalents	Restricted cash and cash equivalents	$	128,061	$	615,950
Fixed maturity securities	Investments	577,688		16,472
Equity securities	Investments	11,839		—
Total restricted assets		$	717,588	$	632,422

Supplemental Cash Flow Information

The table below presents information regarding the Company's changes in other operating assets and liabilities for the years ended December 31, 2024, 2023, and 2022:


	Year ended December 31,
	2024		2023		2022

	in thousands
Prepaid SaaS implementation costs	$	(24,582)	$	(9,405)	$	(7,177)
Deferred reinsurance premiums ceded	(9,144)		(1,335)		(1,448)
Reinsurance recoverable	(8,047)		(10,383)		220
Inventory	(13,482)		2,964		808
Other	(10,338)		8,201		5,364
Total	$	(65,593)	$	(9,958)	$	(2,233)

The table below presents information regarding the Company's non-cash investing and financing activities, as well as the cash paid for interest and taxes for the years ended December 31, 2024, 2023, and 2022:


	Year ended December 31,
	2024		2023		2022

Non-cash investing activities:	in thousands
Issuance of notes receivable (1)	$	6,229	$	6,492	$	7,784
Collection of notes receivable (1)	$	8,084	$	6,094	$	—
Capital expenditures	$	723	$	282	$	1,592
Broad Arrow acquisition	$	—	$	—	$	73,253
Other acquisitions and investments	$	—	$	2,142	$	8,273
Termination of MHH Joint Venture (Refer to Note 11)	$	—	$	2,929	$	—

Non-cash financing activities:
Loss on Warrant Exchange (Refer to Note 20)	$	2,006	$	—	$	—
Exchange of THG units for Class A Common Stock (Refer to Note 19)	$	3,227	$	2,311	$	—

Cash paid for:
Interest	$	8,613	$	6,126	$	4,868
Income taxes	$	17,866	$	10,500	$	5,253

(1) In certain situations, BAC makes loans to refinance accounts receivable balances generated by Broad Arrow Group, Inc. ("Broad Arrow") auction or private sale purchases. These loans are accounted for on the Consolidated Balance Sheets as non-cash reclassifications between "Accounts receivable" and "Notes receivable" and are not presented within Investing Activities in the Company's Consolidated Statements of Cash Flows. Upon repayment, the cash received in settlement of such loans is classified within Operating Activities in the Company's Consolidated Statements of Cash Flows.

Receivables — Accounts receivable primarily consists of payments due from customers for insurance policies sold by the Company's MGA subsidiaries. Premiums receivable consists of premiums due to Hagerty Re from insurance carriers. Commissions receivable consists of profit sharing commissions due to the Company's MGA subsidiaries from insurance carriers. As of December 31, 2024 and 2023, the allowance for expected credit losses related to the Company's receivable balances was not material based on management's quarterly risk assessment, which takes into consideration historical trends, the current economic environment, the creditworthiness of the debtor, and other relevant factors.

Notes Receivable — Notes receivable includes loans underwritten by BAC secured by collector cars. Notes receivable are recorded on the date the loan is funded based on the amount stipulated in the underlying agreement. Loans carry either a fixed or variable rate of interest and typically have an initial maturity of up to two years, often with an option for the borrower to renew for one year increments, provided the borrower remains in good standing. Finance revenue on the loans is recognized when earned based on the amount of the outstanding loan, the applicable interest rate on the loan, and the length of time the loan was outstanding during the period.

Notes receivable are recorded net of an allowance for expected credit losses, which is based on management's quarterly risk assessment and takes into consideration a number of factors including the level of historical losses for similar loans, the quality of the underlying collateral, the loan-to-value ("LTV") ratio of each loan, management's overall assessment of the current circumstances and risks related to each loan, and, to a lesser extent, the circumstances related to each borrower. The valuation of collector cars is inherently subjective, and the realizable value of collector cars often fluctuates over time. Refer to Note 5 — Notes Receivable for additional information.

Deferred Acquisition Costs, net — Deferred acquisition costs include the ceding commissions paid by Hagerty Re to insurance carriers for the risk assumed under quota share reinsurance agreements with those carriers. Deferred acquisition costs are recorded net of commissions received by Hagerty Re for the risk ceded to various reinsurers. Net acquisition costs are deferred and recognized ratably over the term of the related policies, which is generally 12 months.

Deferred acquisition costs are considered to be recoverable if the sum of expected future earned premiums exceeds expected future claims and expenses. Anticipated investment income is also a factor in the recoverability analysis. If, as a result of the recoverability analysis, a loss is determined to be probable, a premium deficiency reserve is recognized in the period in which such determination is made. At December 31, 2024 and 2023, deferred acquisition costs were considered fully recoverable and no premium deficiency reserve was recorded.

Software-as-a-Service — Implementation costs related to software-as-a-service ("SaaS") arrangements are expensed as incurred to "Salaries and benefits" or "General and administrative expenses" on the Consolidated Statements of Operations during the preliminary project stage. Direct implementation costs related to SaaS arrangements are capitalized during the development phase and recorded within "Other current assets" or "Other long-term assets" on the Consolidated Balance Sheets. Capitalized SaaS implementation costs are amortized over the term of the underlying service agreement. The Company monitors SaaS implementation projects on an ongoing basis and capitalizes the costs of any major improvements or new functionality. Once the software is fully implemented, ongoing maintenance costs are expensed as incurred.

Inventory — Inventory primarily consists of vehicles that have been purchased opportunistically for resale by Broad Arrow. Inventory is valued on a specific identification basis at the lower of cost or the Company's estimate of net realizable value (i.e., the expected sale price upon disposition). Inventory is recorded within "Other current assets" on the Consolidated Balance Sheets. If there is evidence that the estimated net realizable value of a specific item held in inventory is less than its carrying value, a writedown is recorded within "Sales expense" in the Consolidated Statements of Operations to reflect a revised estimate of net realizable value on the Consolidated Balance Sheets.

Ceded Reinsurance — Hagerty Re purchases catastrophe reinsurance to protect its capital from large catastrophic events. In addition, Hagerty Re enters into quota share agreements with various reinsurers and purchases semi-automatic facultative reinsurance to cede a portion of the physical damage exposure related to certain policies and vehicles. Reinsurance recoverables are amounts due to Hagerty Re from reinsurers for paid and unpaid loss and loss adjustment expenses. The amount of any reinsurance recoverable is determined by applying the contract terms to incurred losses arising from a qualifying event. Reinsurance recoverables are recorded within "Other current assets" on the Consolidated Balance Sheets.

Deferred reinsurance premiums ceded consists of the unearned portion of premiums ceded by Hagerty Re to various reinsurers. Deferred reinsurance premiums are initially recorded within "Other current assets" on the Consolidated Balance Sheets and subsequently recognized on a pro-rata basis over the term of the related reinsured policies as a reduction to "Earned premium" in the Consolidated Statements of Operations. Refer to Note 14 — Reinsurance for additional information regarding the Company's reinsurance coverage.

Property and Equipment — Property and equipment are recorded at cost and depreciated over the estimated useful life of each asset. Leasehold improvements are amortized over the shorter of either the lease term or the estimated useful life of each improvement. Estimated useful lives range from two to ten years for computers, automobiles, and office furniture. Buildings and building improvements have an estimated useful life of 39 years. Upon sale or retirement, the cost and related accumulated depreciation of the assets disposed are derecognized, and any resulting gain or loss is reflected in the Consolidated Statements of Operations. Annual depreciation is calculated based on the straight-line method. Maintenance, repair costs and minor renovations are expensed as incurred, while expenditures that increase the asset's estimated useful life are capitalized.

Leases — The Company accounts for leases in accordance with ASC Topic 842, Leases ("ASC 842"). At inception, contracts are evaluated to determine whether they are or contain a lease. A contract is or contains a lease if it conveys the right to control the use of identified property, plant or equipment for a period of time in exchange for consideration. At commencement, leases are evaluated for classification as an operating lease or finance lease. Operating lease right-of-use ("ROU") assets and liabilities are recognized at the commencement date of the lease based on the present value of lease payments over the lease term, discounted using the Company's incremental borrowing rate. The Company estimates the incremental borrowing rate based on qualitative factors including company specific credit rating, lease term, impact of collateral, general economics and the interest rate environment. Operating lease liabilities represent the present value of lease payments not yet paid. Operating lease ROU assets are recorded based upon the operating lease liabilities adjusted for prepayments or accrued lease payments, initial direct costs, lease incentives, and previously recognized impairments. The Company does not recognize ROU assets and lease liabilities for short-term leases. The Company has real estate lease agreements that contain lease and non-lease components, which are accounted for as a single lease component.

The Company's leases often contain fixed rent escalations over the lease term. The Company recognizes expense for these leases on a straight-line basis over the lease term. The Company also has lease agreements that are subject to annual changes in the Consumer Price Index ("CPI"). While lease liabilities are not remeasured as a result of changes to the CPI, changes to the CPI are treated as variable lease payments and recognized in the period in which the obligation for those payments has been incurred.

The Company's lease agreements may contain variable costs such as common area maintenance, operating expenses, real estate taxes or other costs. Variable lease costs are expensed as incurred within "General and administrative expenses" in the Consolidated Statements of Operations. The Company's lease agreements generally do not contain any residual value guarantees or restrictive covenants.

The Company has the option to extend most of its lease agreements, with renewals ranging from one to 20 years. The Company includes renewal options in lease terms that are deemed reasonably certain of being exercised in the lease term. As it is not reasonably certain that the Company will exercise these renewal options, they are not included in the lease terms for purposes of calculating the Company's lease liability.

The Company's primary operating leases consist of office space. The Company's leases have remaining terms of one to 12 years. As of December 31, 2024 and 2023, the Company had not entered into any finance leases. Refer to Note 9 — Leases for additional information.

Intangible Assets — Intangible assets are recorded at cost and amortized over the estimated life of each intangible asset, unless the estimated life is deemed to be indefinite. Acquired intangible assets are initially recorded at fair value using generally accepted valuation methods appropriate for the type of intangible asset. Intangible assets primarily consist of insurance policy renewal rights, internally developed software, trade names, non-compete agreements, and customer relationships, as well as indefinite lived state insurance licenses. Amortization is recorded using the straight-line method over the estimated life of the intangible asset as it approximates the pattern over which economic benefits are realized. Insurance policy renewal rights, internally developed software, trade names, non-compete agreements, and customer relationships are amortized over three to 25 years. The Company expenses internally developed software costs incurred during the preliminary project stage and, upon management approval, capitalizes direct development costs including the associated payroll and related costs for employees working on development, as well as outside contractor costs.

Goodwill — Goodwill represents the excess of the cost of a business combination over the fair value of net assets acquired, including identifiable intangible assets. Goodwill is not amortized, but is tested annually for impairment at the reporting unit level as of October 1 and between annual tests if indicators of potential impairment exist.

For reporting units with goodwill, the Company performs a qualitative analysis to determine whether it is more likely than not the fair value of the reporting unit is less than its carrying amount. When assessing goodwill for impairment, the Company's decision to perform a qualitative assessment for an individual reporting unit is based on a number of factors, including the carrying value of the reporting unit's goodwill, the amount of time in between quantitative fair value assessments, macro-economic conditions, industry and market conditions, and the operating performance of the reporting unit. If it is determined, based on qualitative factors, that it is more likely than not that the fair value of the reporting unit is less than its carrying amount, a quantitative impairment test is performed, in which the Company determines the estimated fair value of the reporting unit using a discounted cash flow analysis. This analysis requires significant judgment, including the estimation of future cash flows, which is dependent on internal forecasts, available industry and market data, the estimation of the long-term rate of growth for the reporting unit including expectations and assumptions regarding the impact of general economic conditions on the reporting unit, the estimation of the useful life over which cash flows will occur (including terminal multiples), the determination of the respective weighted average cost of capital, and market participant assumptions.

As of December 31, 2024, the Company has goodwill of $114.1 million, including $103.6 million attributable to the Marketplace reporting unit. The Company did not recognize any goodwill impairments during the years ended December 31, 2024, 2023, and 2022.

Impairment of Long-Lived Assets — The Company reviews all long-lived assets that have finite lives for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable in accordance with ASC Topic 360, Impairment and Disposal of Long-Lived Assets ("ASC 360"). If it is determined the carrying amount of the asset (or asset group) is not recoverable, an impairment loss is recognized within operating expenses in the Consolidated Statements of Operations in the period in which such determination is made.

The determination of the recoverability of a long-lived asset (or asset group) is based on an estimate of the undiscounted cash flows resulting from the use of the asset (or asset group) and its eventual disposition. If the carrying value of the long-lived asset (or asset group) is not recoverable on an undiscounted cash flow basis, an impairment loss is recognized to the extent that the carrying value exceeds the fair value of the long-lived asset (or asset group). Fair value is determined through various valuation techniques including discounted cash flow models, quoted market values and third-party independent appraisals, as necessary.

Losses Payable — Losses payable represents the amount due to insurance carriers by Hagerty Re for paid and billed losses as of the balance sheet date.

Provision for Unpaid Losses and Loss Adjustment Expenses — The provision for unpaid losses and loss adjustment expenses is the difference between management's estimate of the ultimate cost of losses and loss adjustment expenses incurred by Hagerty Re and the amount of paid losses as of the reporting date. These reserves reflect management's best estimate of unpaid losses related to both reported claims and IBNR claims, as well as processing and settlement expenses related to the claims.

Estimating the ultimate cost of claims and claims expenses is an inherently complex and subjective process that involves many variables and a high degree of judgment. Reserves are reviewed by management quarterly and periodically throughout the year by combining historical results and current actual results to calculate new development factors. When estimating reserves, the Company's actuarial reserving group utilizes several actuarial reserving methods which consider historical claim reporting patterns, claim cycle time, claim frequency and severity, claims settlement practices, adequacy of case reserves over time, seasonality, and current economic conditions. Because actual experience can differ from key assumptions used in estimating reserves, there may be significant variation in the development of reserves and the amount of actual losses and loss adjustment expenses ultimately paid in the future. The Company does not discount its provision for unpaid losses and loss adjustment expenses to reflect the time value of money. Any adjustments to the provision for losses and loss adjustment expenses, and any related reinsurance recoverables, are recognized in the Consolidated Statements of Operations in the period in which management makes the determination that an adjustment is required.

Refer to Note 13 — Provision for Unpaid Losses and Loss Adjustment Expenses for additional information regarding the methodologies used to estimate loss and loss adjustment expense reserves.

Advance Premiums and Due to Insurers — Advance premiums represents the aggregate amount of gross written premium received by the Company's MGA subsidiaries prior to the effective date of the underlying policies. After a policy becomes effective, the amount of premium owed to the insurance carrier, net of the commission earned by the Company, is recorded within Due to insurers.

Warrant Liabilities — Prior to the warrant exchange transaction that was completed in the third quarter of 2024, which resulted in the settlement of all outstanding warrants, the Company accounted for its warrants in accordance with ASC Topic 815, Derivatives and Hedging ("ASC 815"). The warrants did not meet the criteria for equity treatment and as such, were recorded as a liability at their fair value. The warrant liability was subject to remeasurement each reporting period with the change in fair value between reporting periods recorded within "Gain (loss) related to warrant liabilities, net" in the Consolidated Statements of Operations. Refer to Note 20 — Warrant Exchange for additional information related to the Warrant Exchange.

Revenue Recognition — The Company recognizes revenue under ASC Topic 606, Revenue from Contracts with Customers ("ASC 606"), ASC Topic 944, Financial Services — Insurance ("ASC 944"), and ASC Topic 310, Receivables ("ASC 310").

Commission and fee revenue

The Company's MGA subsidiaries earn commission and fee revenue primarily from the underwriting, sale, and servicing of collector car and enthusiast vehicle insurance policies written on behalf of insurance carriers. Approximately 93% of the Company's commission and fee revenue is earned through the policies sold by its U.S. MGAs on behalf of a subsidiary of Markel Group, Inc. ("Markel"), which is a related party. Refer to Note 24 — Related-Party Transactions for additional information.

The Company has identified the insurance carrier as its customer and determined that the transaction price is the estimated commissions to be received over the term of the policy. The transaction price is determined based on an estimate of premiums written, net of a constraint for policy changes and cancellations. These commissions and fees, including those paid via installment plan, are earned when the policy becomes effective, as the Company's performance obligation is substantially complete when the policy is issued, all rights are passed to the insured, and the obligation to pay a claim resides with the carrier.

Under the terms of the contracts with certain insurance carriers, the Company has the opportunity to earn a contingent underwriting commission ("CUC") based on the results of the book of business, including the level of written or earned premium and loss ratio. Each insurance carrier partner contract and related CUC is calculated independently. The CUCs represent a form of variable consideration associated with the placement of insurance coverage. Under ASC 606, the Company must estimate the amount of consideration that it will become entitled to receive during the calendar year such that a significant reversal of revenue is not probable. As such, CUCs are recognized as a contract asset within "Commissions receivable" on the Consolidated Balance Sheets in the period that the policy is issued using the applicable premium and payout factors based on the estimated loss ratio from the contract.

Earned premium

Earned premium represents the earned portion of written premiums that Hagerty Re has assumed under quota share reinsurance agreements with the Company's insurance carrier partners, net of premiums ceded to various reinsurers and the cost of catastrophe reinsurance coverage. Premiums assumed and ceded are earned on a pro-rata basis over the term of the related insurance policies, which is generally 12 months, with the unearned portion recorded as "Unearned premiums" on the Consolidated Balance Sheets. The cost of catastrophe reinsurance coverage is recognized over the contract period in proportion to the related earned premium.

Membership, marketplace and other revenue

Subscription revenue is earned through HDC memberships, which are primarily bundled with the Company's insurance policies and give subscribers access to an array of products and services, including emergency roadside assistance, Hagerty Drivers Club Magazine, automotive enthusiast events, Hagerty's proprietary vehicle valuation tool, and special vehicle-related discounts. The Company also earns fee-based revenue from Hagerty Garage + Social memberships, which include storage services in addition to the HDC Member benefits. Revenue from the sale of HDC and storage memberships is recognized ratably over the period of the membership. The membership is treated as a single performance obligation to provide access to stated Member benefits over the life of the membership, which is currently one year.

The Company's marketplace business earns fee-based revenue primarily from the sale of collector cars and enthusiast vehicles through live auctions, time-based digital auctions, and brokered private sales. From time-to-time, the marketplace business also earns revenue from the sale of collector cars and enthusiast vehicles that have been acquired opportunistically and placed in inventory. In addition, the marketplace business also earns finance revenue from loans made to qualified collectors and businesses secured by their collector cars.

Fee-based marketplace revenue is recognized when the underlying sale is completed, which is generally upon the matching of a seller and buyer in a legally binding auction or private sale transaction. Revenue from the sale of inventory is recognized at the point in time when title and control of the car is transferred to the buyer, which is generally upon collection of the full purchase price. Finance revenue is recognized over time as earned based on the amount of the outstanding loan, the applicable interest rate on the loan, and the length of time the loan was outstanding during the period.

Lastly, other revenue includes sponsorship, admission, advertising, valuation, registration, and sublease income. Other revenue is recognized when the performance obligation for the related product or service is satisfied.

Contract Assets

Contract assets includes amounts due to the Company's MGA subsidiaries for CUCs earned, but not yet billed. Contract assets are recorded within "Commissions receivable" on the Consolidated Balance Sheets.

Contract Liabilities

Contract liabilities primarily includes payments received by the Company in advance of fulfilling its contractual performance obligations.

Contract Costs

The Company accounts for contract costs under ASC Topic 340, Other Assets and Deferred Costs, ("ASC 340"), which requires the capitalization of certain costs incurred to obtain or fulfill customer contracts. The Company's contract costs primarily relate to commission payments made by its MGA subsidiaries on new policy sales. These capitalized costs are amortized to "Sales expense" in the Consolidated Statements of Operations based on the average expected life of the underlying insurance policy and are included within "Other current assets" on the Consolidated Balance Sheets.

Refer to Note 2 — Revenue for additional information.

Advertising — Advertising and sales promotion costs are expensed the first time the advertising or sales promotion takes place. Advertising costs were $25.9 million, $25.5 million, and $27.8 million for the years ended December 31, 2024, 2023, and 2022, respectively, and are reflected as a component of "Sales expense" in the Consolidated Statements of Operations.

Income Taxes — With the exception of certain U.S. corporate and foreign subsidiaries, THG is taxed as a pass-through ownership structure under the Internal Revenue Code ("IRC") and a similar section of state income tax law. As such, any taxable income or loss generated by THG is passed through to and included in the taxable income or loss of THG unit holders, including Hagerty, Inc.

Hagerty, Inc. is taxed as a corporation and pays corporate federal, state and local taxes with respect to income allocated from THG. Hagerty, Inc., Hagerty Insurance Holdings, Inc., Broad Arrow, Hagerty Radwood, Inc., and various foreign subsidiaries are treated as taxable entities and income taxes are provided where applicable. Hagerty Insurance Holdings, Inc. files a consolidated tax return including its wholly owned corporate subsidiaries, Hagerty Re and Drivers Edge.

Where applicable, income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to: (i) differences between the financial statement carrying values and tax bases of assets and liabilities and (ii) operating loss and tax-credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the Consolidated Statements of Operations in the period when the change is enacted.

The Company evaluates the carrying value of its deferred tax assets on a quarterly basis. In completing this evaluation, management considers all available positive and negative evidence. Such evidence includes historical operating results, the existence of cumulative earnings and losses in the most recent fiscal years, taxable income in prior carryback year(s) if permitted under the tax law, expectations for future pre-tax operating income, the time period over which temporary differences will reverse, and the implementation of feasible and prudent tax planning strategies. Estimating future taxable income is inherently uncertain and requires judgment. Deferred tax assets are reduced by a valuation allowance if, based on the weight of this evidence, it is more likely than not that all or a portion of the recorded deferred tax assets will not be realized in future periods.

Refer to Note 23 — Taxation for additional information.

Tax Receivable Agreement Liability — In connection with the business combination that formed Hagerty, Inc. in 2021, Hagerty, Inc. entered into a TRA with Hagerty Holding Corp. ("HHC") and Markel (together the "Legacy Unit Holders"). The TRA provides for payment to the Legacy Unit Holders of 85% of the U.S. federal, state and local income tax savings realized by Hagerty, Inc. as a result of the increases in tax basis and certain other tax benefits as outlined in the Business Combination Agreement upon the exchange of THG units and shares of Hagerty, Inc. Class V Common Stock for shares of Hagerty, Inc. Class A Common Stock or cash. The Business Combination Agreement is provided as Exhibit 2.1 to this Annual Report, which is incorporated by reference within Item 15. Exhibits, Financial Statement Schedules. In connection with the filing of its 2019 income tax return THG made an election under Section 754 of the IRC for each taxable year in which TRA exchanges occur. This election cannot be revoked without the permission of the IRS Commissioner and will be in place for any future exchange of THG units. The remaining 15% cash tax savings resulting from the basis adjustments will be retained by Hagerty, Inc.

In general, under the TRA, cash tax savings result in a year when the tax liability of Hagerty, Inc. for the year, computed without regard to the deductions attributable to the amortization of the basis increase and other deductions that arise in connection with the payment of the cash consideration under the TRA or the exchange of THG units and shares of Hagerty, Inc. Class V Common Stock for shares of Hagerty, Inc. Class A Common Stock, would be more than the tax liability for the year taking into account such deductions. Payments under the TRA will not be due until the Company produces taxable income and the resulting cash tax liability is reduced by deducting the amortization of the basis increase on a filed tax return. The payments under the TRA are expected to be substantial. The estimated value of the TRA is recorded in "Accounts payable, accrued expenses and other current liabilities" and "Other long-term liabilities" on the Consolidated Balance Sheets.

Hagerty, Inc. accounted for the effects of the basis increases as follows:

•Hagerty, Inc. recorded an increase in deferred tax assets for the income tax effects of the increases in tax basis based on enacted federal and state income tax rates at the date of the exchange.

•Hagerty, Inc. evaluated the ability to realize the full benefit represented by the deferred tax asset based on an analysis that considered expectations of future earnings, among other things. If Hagerty, Inc. determined that the full benefit is not likely to be realized, a valuation allowance was established to reduce the amount of the deferred tax assets to an amount that is more likely than not to be realized.

•Hagerty, Inc. recorded 85% of the estimated realizable tax benefit as an increase to the liability due under the TRA, which is recorded within "Other long-term liabilities", with a decrease to "Additional paid-in capital" on the Consolidated Balance Sheets. The remaining 15% of the estimated realizable tax benefit will be retained by Hagerty, Inc.

All of the effects of changes in any of the estimates after the date of the redemption or exchange are recorded within "Interest and other income (expense), net" in the Consolidated Statements of Operations.

Earnings Per Share — The Company calculates basic and diluted earnings per share ("EPS") in accordance with ASC Topic 260, Earnings Per Share ("ASC 260"). Basic EPS is calculated under the Two-Class Method using basic Net income available to Class A Common Stockholders divided by the weighted average number of shares of Class A Common Stock outstanding during the period. Diluted EPS is calculated using diluted Net income available to Class A Common Stockholders divided by the weighted average number of shares of Class A Common Stock outstanding during the period, adjusted to give effect to potentially dilutive securities.

The Company's potentially dilutive securities consist of (i) unvested share-based compensation awards, shares issuable under the employee stock purchase plan, and unexercised warrants (prior to completion of Warrant Exchange), with the dilutive effect calculated using the Treasury Stock Method, and (ii) non-controlling interest THG units and the Series A Convertible Preferred Stock, with the dilutive effect calculated using the more dilutive of the If-Converted Method and the Two-Class Method.

In periods in which the Company reports a net loss attributable to Class A Common Stockholders, diluted net loss per share attributable to Class A Common Stockholders would be equal to basic net loss per share since potentially dilutive shares of Class A Common Stock are not assumed to be issued if their effect is anti-dilutive.

Share-Based Compensation — The Company issues restricted stock units ("RSUs"), market condition performance restricted stock units ("PRSUs"), and performance condition PRSUs under the 2021 Stock Incentive Plan. Share-based compensation expense is measured at the grant date based upon the estimated fair value of the award and is recognized as expense over the applicable requisite service period of the award generally using the straight-line method. Forfeitures are recorded in the period in which they occur. Refer to Note 21 — Share-Based Compensation for additional information.

Self-Insurance — The Company has elected to self-insure certain costs related to U.S. employee health benefit and short-term disability programs. Costs resulting from self-insured losses are charged to expense when incurred. The Company has purchased insurance that limits its aggregate annual exposure for healthcare costs to approximately $17.9 million, $16.3 million, and $11.4 million for the years ended December 31, 2024, 2023, and 2022, respectively. Total expenses for healthcare claims incurred for the years ended December 31, 2024, 2023, and 2022 were approximately $13.6 million, $14.2 million, and $13.2 million, respectively. Healthcare claims are recorded within "Salaries and benefits" on the Consolidated Statements of Operations. As of December 31, 2024 and 2023, the Company has recorded approximately $1.6 million and $1.4 million as an estimate of IBNR claims, respectively. The amount of actual losses incurred could differ materially from the estimate reflected in these financial statements.

Postretirement Benefits — The Company offers postretirement benefits. In the U.S., the Company offers a 401(k) plan covering substantially all U.S. employees. The plan provides for 4.0% matching contributions. Contributions to the plan were $6.5 million, $6.0 million, and $6.2 million for the years ended December 31, 2024, 2023 and 2022, respectively.

Recently Adopted Accounting Standards

Credit Losses — In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments - Credit Losses (ASC 326): Measurement of Credit Losses on Financial Instruments, which amends previously issued guidance regarding the impairment of financial instruments by creating an impairment model that is based on expected losses rather than incurred losses. This standard requires financial assets measured on the amortized cost basis to be presented at the net amount expected to be collected. The following financial assets held by the Company are within the scope of ASU No. 2016-13: (i) Accounts receivable, (ii) Premiums receivable, (iii) Commissions receivable, (iv) Notes receivable, and (v) certain fixed income securities. The amount of any required allowance for expected credit losses is determined utilizing historical loss rates, which are then adjusted, if necessary, for specific financial assets that are judged to have a higher-than-normal risk profile. Additional credit loss allowances may also be recorded after taking into account macro-economic and industry risk factors. For Notes receivable, to the extent necessary, the amount of any required allowance for credit losses takes into account the estimated realizable value of the collateral securing the loan. The Company adopted ASU No. 2016-13 on January 1, 2023 without a material effect on the Company's Consolidated Financial Statements and with no required cumulative-effect adjustment to "Accumulated earnings (deficit)" within the Consolidated Statements of Changes in Temporary Equity and Stockholders' Equity.

Segment Reporting — In November 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2023-07 - Segment Reporting (ASC 280): Improvements to Reportable Segment Disclosures, which enables investors to better understand an entity's overall performance and assess potential future cash flows through improved reportable segment disclosure requirements. The amendments enhance disclosures about significant segment expenses, clarify circumstances in which an entity can disclose multiple segment measures of profit or loss, provide new segment disclosure requirements for entities with a single reportable segment, and contain other disclosure requirements. ASU 2023-07 is effective for annual periods beginning after December 15, 2023. The Company adopted ASU No. 2023-07 on January 1, 2024. The adoption of the standard did not result in any significant disclosure changes in the Notes to the Consolidated Financial Statements.

Accounting Standards Not Yet Adopted

Income Taxes — In December 2023, the FASB issued ASU No. 2023-09 - Income Taxes (ASC 740), Improvements to Income Tax Disclosures, which enhances the transparency and decision usefulness of income tax disclosures through changes to the rate reconciliation and income taxes paid information. ASU No. 2023-09 modifies the rules on income tax disclosures to require entities to disclose (i) specific categories in the rate reconciliation, (ii) the income or loss from continuing operations before income tax expense or benefit (separated between domestic and foreign), and (iii) income tax expense or benefit from continuing operations (separated by federal, state and foreign). ASU No. 2023-09 also requires entities to disclose their income tax payments to international, federal, state and local jurisdictions, among other changes. ASU No. 2023-09 is effective for annual periods beginning after December 15, 2024. Upon adoption, the Company will include the required additional disclosures in the Notes to the Consolidated Financial Statements.

Income Statement Expenses — In November 2024, the FASB issued ASU No. 2024-03, Disaggregation of Income Statement Expenses (ASC 220-40), which enables investors to better understand an entity's performance, assessing an entity's prospects for future cash flows, and comparing an entity's performance over time and with that of other entities. The amendments primarily require entities to disaggregate, in the notes to financial statements, any relevant expense caption presented on the face of the income statement within continuing operations into the following required natural expense categories: purchases of inventory, employee compensation, depreciation, and intangible asset amortization. The new standard does not change the presentation of expense information on the face of the income statement. ASU 2024-03 is effective for annual periods beginning after December 15, 2026. The Company is still assessing the impact of ASU No. 2024-03 and upon adoption may be required to include certain additional disclosures in the Notes to the Consolidated Financial Statements.

Revenue

12 Months Ended

Dec. 31, 2024

Revenue from Contract with Customer [Abstract]

Revenue

2 — Revenue

Disaggregation of Revenue — The tables below present the Company's revenue by distribution channel, as well as a reconciliation to total revenue for the years ended December 31, 2024, 2023, and 2022. Commission and fee revenue and contingent commission revenue earned from the agent distribution channel includes revenue generated through the Company's insurance distribution partnerships, as well as its relationships with independent agents and brokers. Commission and fee revenue and contingent commission revenue earned from the direct distribution channel includes revenue generated by Hagerty's employee agents.

Under the Company's alliance agreement and associated agency agreement with Markel, the Company's MGA subsidiaries currently earn a base commission rate of approximately 37%, as well as an additional contingent underwriting commission ("CUC") that scales annually from -5% to a maximum of +5% of written premium, with 80% of the expected CUC paid monthly. Prior to 2024, the base commission rate was approximately 32% of written premium, with a CUC of up to 10%. This amendment resulted in a smaller proportion of total revenue being attributable to contingent commission revenue during the year ended December 31, 2024, when compared to the years ended December 31, 2023 and 2022.


	Year ended December 31, 2024
	Agent		Direct		Total

	in thousands
Commission and fee revenue	$	210,052	$	171,252	$	381,304
Contingent commission revenue	23,228		18,708		41,936
Membership revenue	—		57,549		57,549
Marketplace revenue	—		46,360		46,360
Other revenue	—		21,607		21,607
Total revenue from customer contracts	233,280		315,476		548,756
Earned premium (recognized under ASC 944)					643,324
Finance revenue (recognized under ASC 310)					7,958
Total revenue					$	1,200,038


	Year ended December 31, 2023
	Agent		Direct		Total

	in thousands
Commission and fee revenue	$	158,354	$	131,178	$	289,532
Contingent commission revenue	42,408		33,572		75,980
Membership revenue	—		52,460		52,460
Marketplace revenue	—		23,665		23,665
Other revenue	—		21,796		21,796
Total revenue from customer contracts	200,762		262,671		463,433
Earned premium (recognized under ASC 944)					531,866
Finance revenue (recognized under ASC 310)					4,914
Total revenue					$	1,000,213


	Year ended December 31, 2022
	Agent		Direct		Total

	in thousands
Commission and fee revenue	$	133,584	$	113,864	$	247,448
Contingent commission revenue	32,899		26,891		59,790
Membership revenue	—		45,234		45,234
Marketplace revenue	—		12,828		12,828
Other revenue	—		18,385		18,385
Total revenue from customer contracts	166,483		217,202		383,685
Earned premium (recognized under ASC 944)					403,061
Finance revenue (recognized under ASC 310)					842
Total revenue					$	787,588

The following tables present Hagerty's revenue disaggregated by geographic area, as well as a reconciliation to total revenue for the years ended December 31, 2024, 2023, and 2022:


	Year ended December 31, 2024
	U.S.		Canada		Europe		Total

	in thousands
Commission and fee revenue	$	352,916	$	22,361	$	6,027	$	381,304
Contingent commission revenue	41,490		1		445		41,936
Membership revenue	53,798		3,746		5		57,549
Marketplace revenue	44,356		595		1,409		46,360
Other revenue	19,243		687		1,677		21,607
Total revenue from customer contracts	511,803		27,390		9,563		548,756
Earned premium (recognized under ASC 944)							643,324
Finance revenue (recognized under ASC 310)							7,958
Total revenue							$	1,200,038


	Year ended December 31, 2023
	U.S.		Canada		Europe		Total

	in thousands
Commission and fee revenue	$	264,137	$	20,597	$	4,798	$	289,532
Contingent commission revenue	75,810		—		170		75,980
Membership revenue	48,902		3,558		—		52,460
Marketplace revenue	22,323		950		392		23,665
Other revenue	19,699		644		1,453		21,796
Total revenue from customer contracts	430,871		25,749		6,813		463,433
Earned premium (recognized under ASC 944)							531,866
Finance revenue (recognized under ASC 310)							4,914
Total revenue							$	1,000,213


	Year ended December 31, 2022
	U.S.		Canada		Europe		Total

	in thousands
Commission and fee revenue	$	224,255	$	19,142	$	4,051	$	247,448
Contingent commission revenue	59,664		—		126		59,790
Membership revenue	41,893		3,341		—		45,234
Marketplace revenue	12,693		58		77		12,828
Other revenue	16,443		708		1,234		18,385
Total revenue from customer contracts	354,948		23,249		5,488		383,685
Earned premium (recognized under ASC 944)							403,061
Finance revenue (recognized under ASC 310)							842
Total revenue							$	787,588

Refer to Note 14 — Reinsurance for information regarding "Earned premium" recognized under ASC Topic 944, Financial Services - Insurance ("ASC 944").

Contract Assets and Liabilities — The following table is a summary of the Company's contract assets and liabilities as of December 31, 2024 and 2023.


	December 31,
	2024		2023

	in thousands
Contract assets	$	15,860	$	75,891
Contract liabilities	$	47,239	$	47,651

Contract assets, which are reported within "Commissions receivable" on the Consolidated Balance Sheets, primarily consists of CUC receivables, which are earned throughout the year and have historically been settled by a cash payment from the insurance carrier in the first quarter of the following year. As a result of its amended alliance agreement and associated agency agreement with Markel, beginning in 2024, 80% of the CUC receivables from Markel are now being settled monthly rather than on an annual basis. This amendment resulted in a significant decrease in the contract assets balance compared to the prior year.

Contract liabilities consist of cash collected in advance of revenue recognition and primarily includes the unrecognized portion of HDC membership fees, the unrecognized portion of the advanced commission payment received from State Farm Mutual Automobile Insurance Company ("State Farm"), and, to a much lesser extent, cash collected in advance of the completion of marketplace private sales.

Contract liabilities related to HDC membership fees and marketplace private sales have a duration of one year or less. For contracts that are long-term in nature, the Company recognized approximately $2.0 million of revenue during the year ended December 31, 2024, which represents revenue related to the advanced commission payment received from State Farm. Refer to Note 24 — Related-Party Transactions for additional information regarding the Company's master alliance agreement with State Farm.

- Definition

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 9
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479806/606-10-50-9

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 10
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479806/606-10-50-10

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 15
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479806/606-10-50-15

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479806/606-10-50-12

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479806/606-10-50-12

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479806/606-10-50-12

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479806/606-10-50-12

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Subparagraph (e)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479806/606-10-50-12

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (b)(2)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147479806/606-10-50-13

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Name Accounting Standards Codification
-Topic 606
-Publisher FASB
-URI https://asc.fasb.org/606/tableOfContent

+ Details

Deferred Acquisition Costs

12 Months Ended

Dec. 31, 2024

Deferred Policy Acquisition Costs Disclosures [Abstract]

Deferred Acquisition Costs

6 — Deferred Acquisition Costs

The following table presents a reconciliation of the changes in deferred acquisition costs for the years ended December 31, 2024, 2023, and 2022:


	December 31,
	2024		2023		2022

	in thousands
Deferred acquisition costs as of January 1,	$	141,637	$	107,342	$	81,535
Acquisition costs deferred, net	316,548		286,100		216,957
Amortization of acquisition costs, net	(301,719)		(251,805)		(191,150)
Deferred acquisition costs as of December 31,	$	156,466	$	141,637	$	107,342

Investments

12 Months Ended

Dec. 31, 2024

Investments, Debt and Equity Securities [Abstract]

Investments

3 — Investments

During the second quarter of 2024, the Company diversified its investment portfolio, purchasing fixed maturity securities and, to a much lesser extent, equity securities, with the fixed maturity securities classified as available-for-sale.

During the third quarter of 2024, in connection with the acquisition of Drivers Edge, the Company acquired additional fixed maturity securities, also classified as available-for-sale. Refer to Note 10 — Acquisitions for additional information related to the acquisition of Drivers Edge.

The Company also holds fixed maturity securities consisting of Canadian Sovereign, Provincial, and Municipal bonds. Prior to the second quarter of 2024, these investments were classified as held-to-maturity because the Company had the intent and ability to hold the investments to maturity. However, in the second quarter of 2024, these investments were reclassified as available-for-sale because management now intends to opportunistically sell bonds from this portfolio in connection with the diversification of the Company's investment portfolio. As a result of this reclassification, the Company recognized an unrealized loss of $0.2 million in the Consolidated Statements of Comprehensive Income in the second quarter of 2024.

As of December 31, 2024, all fixed maturity securities had an investment grade rating from at least one nationally recognized rating organization.

Available-for-sale investments

The following table summarizes the Company's available-for-sale investments as of 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

On a quarterly basis, fixed maturity securities with unrealized losses are reviewed to determine whether the decline in fair value is attributable to a material credit loss. As of December 31, 2024, no credit loss allowance was recorded and all unrealized losses on available-for-sale fixed maturity securities were in such position for less than one year. It is management's intent to hold these investments to recovery, or maturity, if necessary, to recover the decline in valuation as prices accrete to par.

The following table summarizes the contractual maturities of the Company's available-for-sale investments as of December 31, 2024:



	Amortized Cost		Estimated Fair Value

	in thousands
Due in one year or less	$	61,952	$	62,118
Due after one year through five years	292,650		293,300
Due after five years through ten years	73,112		72,312
Due after ten years	1,979		1,975
Mortgage-backed and asset-backed securities	148,976		147,983
Total fixed maturity securities	$	578,669	$	577,688

Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

Held-to-maturity investments

The following table summarizes the fair value and related carrying amount of the Company's held-to-maturity investments as of December 31, 2023:



	Carrying Amount		Estimated Fair Value

	in thousands
Short-term	$	10,946	$	10,864
Long-term	5,526		5,398
Total	$	16,472	$	16,262

Net investment income

The following table presents the components of net investment income for the years ended December 31, 2024, 2023, and 2022:


	Year ended December 31,
		2024		2023		2022

Interest income:		in thousands
Cash and cash equivalents and restricted cash and cash equivalents		$	22,080	$	26,457	$	6,460
Fixed maturity securities		17,395		447		149
Total interest income		39,475		26,904		6,609
Dividends on equity securities		98		—		—
Gross investment income		39,573		26,904		6,609
Investment expenses		(324)		—		—
Net investment income		$	39,249	$	26,904	$	6,609

Net realized and unrealized gains (losses) on investments

The table below presents the components of pre-tax net investment gains (losses) included in Net income in the Consolidated Statements of Operations and the pre-tax change in net unrealized gains (losses) included in the Consolidated Statements of Comprehensive Income for the year ended December 31, 2024. The gross amounts of realized investment gains and losses on fixed maturity securities were not material to the Consolidated Financial Statements and are presented on a net basis in the table below.



	Year ended December 31, 2024

Fixed maturity securities:	in thousands
Net realized investment gains (losses)	$	927
Equity securities:


Total change in fair value of equity securities	1,296
Net investment gains (losses)	$	2,223
Change in net unrealized gains (losses) on available-for-sale investments included in Other comprehensive income (loss):
Fixed maturity securities	$	(981)

Fair Value Measurements

12 Months Ended

Dec. 31, 2024

Fair Value Disclosures [Abstract]

Fair Value Measurements

4 — Fair Value Measurements

Fair value measurements are classified within one of three levels in the fair value hierarchy. The level assigned to a fair value measurement is based on the lowest level input that is significant to the fair value measurement in its entirety. Assessing the significance of a particular input requires judgment.

The three levels of the fair value hierarchy are as follows:

•Level 1 — Quoted prices are available in active markets for identical assets or liabilities as of the reporting date. Active markets are those in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis.

•Level 2 — Pricing inputs are other than quoted prices in active markets, which are either directly or indirectly observable as of the reporting date for substantially the full term of the asset or liability.

•Level 3 — Pricing inputs are unobservable, but management believes that such inputs are predicated on the assumptions market participants would use to measure the asset or liability at fair value.

The Company's policy is to recognize significant transfers between levels, if any, at the end of the reporting period. There were no transfers between levels during the current and prior reporting periods.

Investments

Fixed maturity securities are classified as Level 2 within the fair value hierarchy and equity securities are classified as Level 1. The fair value of these investments is determined after considering various sources of information, including information provided by a third-party pricing service, which provides prices for substantially all of the Company's fixed maturity securities and equity securities. In determining fair value, the Company generally does not adjust the prices obtained from the pricing service. The Company obtains an understanding of the pricing service's valuation methodologies and related inputs, which include, but are not limited to, reported trades, benchmark yields, issuer spreads, bids, offers, duration, credit ratings, estimated cash flows, and prepayment speeds.

Refer to Note 3 — Investments for additional information related to the Company's investment portfolio.

Interest rate swap

In December 2020, the Company entered into an interest rate swap with an original notional amount of $35.0 million, a fixed swap rate of 0.81%, and a maturity date in December 2025. The interest rate swap was designated as a cash flow hedge and the Company formally documented the relationship between the interest rate swap and its variable rate borrowings, as well as its risk management objective and strategy for undertaking the hedge transaction. The Company also assessed whether the interest rate swap was highly effective in offsetting variability in the cash flows of its variable rate borrowings. The hedge was deemed highly effective at inception and on an ongoing basis; therefore, any changes in fair value were recorded within "Change in unrealized gain (loss) on interest rate swap" in the Consolidated Statements of Comprehensive Income. The differential paid or received on the interest rate swap agreement was recognized as an adjustment to interest expense within "Interest and other income (expense), net" in the Consolidated Statements of Operations.

As of December 31, 2023, the interest rate swap was in an asset position and had a fair value of $2.2 million, which was recorded within "Other long-term assets" on the Consolidated Balance Sheets. The interest rate swap was classified as Level 2 within the fair value hierarchy. The significant inputs used to determine the fair value of the interest rate swap, such as the Secured Overnight Financing Rate ("SOFR") forward curve, are considered observable market inputs.

In the second quarter of 2024, the Company reduced its borrowings under the JPM Credit Facility (as defined in Note 17 — Long-Term Debt) below the $35.0 million notional amount of the interest rate swap and, as a result, the interest rate swap was settled prior to its maturity date. In connection with the settlement of the interest rate swap, the Company received $2.3 million in cash proceeds and recognized a $2.3 million gain in the second quarter of 2024 within "Interest and other income (expense), net" in the Consolidated Statements of Operations, with a corresponding amount reclassified from Accumulated other comprehensive income (loss).

Warrant liabilities

As of December 31, 2023, the Company's Public Warrants were classified as Level 1 within the fair value hierarchy as they were measured utilizing quoted market prices. The Company's Private Warrants, Underwriter Warrants, OTM Warrants (together with the Private Warrants and Underwriter Warrants, the "Private Placement Warrants"), and PIPE Warrants were classified as Level 3 within the fair value hierarchy. The Company utilized a Monte Carlo simulation model to measure the fair value of the Level 3 warrants. The Company's Monte Carlo simulation model included assumptions related to the expected stock price volatility, expected term, dividend yield, and risk-free interest rate.

In the third quarter of 2024, the Company completed the Warrant Exchange, which resulted in the settlement of all outstanding warrants. Refer to Note 20 — Warrant Exchange for additional information related to the Warrant Exchange.

Summary of assets and liabilities measured at fair value

The fair values of the Company's financial assets and liabilities as of December 31, 2024 and December 31, 2023 are shown in the following tables:


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

	in thousands
Financial Assets
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	$	—

	Estimated Fair Value as of December 31, 2023
	Total		Level 1		Level 2		Level 3

	in thousands
Financial Assets
Fixed maturity securities, held to maturity:
Foreign	$	16,262	$	—	$	16,262	$	—
Interest rate swap	2,234		—		2,234		—
Total	$	18,496	$	—	$	18,496	$	—

Financial Liabilities
Public Warrants	$	9,488	$	9,488	$	—	$	—
Private Warrants	476		—		—		476
Underwriter Warrants	53		—		—		53
OTM Warrants	3,981		—		—		3,981
PIPE Warrants	20,020		—		—		20,020
Total	$	34,018	$	9,488	$	—	$	24,530

The following table presents a reconciliation of the Company's warrant liabilities that are classified as Level 3 within the fair value hierarchy for the years ended December 31, 2024 and 2023:


	Private Warrants		Underwriter Warrants		OTM Warrants		PIPE Warrants		Total

	in thousands





Balance at December 31, 2022	$	673	$	75	$	4,706	$	27,227	$	32,681
Change in fair value of warrant liabilities	(197)		(22)		(725)		(7,207)		(8,151)
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 (see Note 20)	(531)		(58)		(4,527)		(24,076)		(29,192)
Balance at December 31, 2024	$	—	$	—	$	—	$	—	$	—

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References

Reference 1: http://www.xbrl.org/2003/role/exampleRef
-Topic 820
-SubTopic 10
-Name Accounting Standards Codification
-Section 55
-Paragraph 107
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482078/820-10-55-107

Reference 2: http://www.xbrl.org/2003/role/exampleRef
-Topic 820
-SubTopic 10
-Name Accounting Standards Codification
-Section 55
-Paragraph 100
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482078/820-10-55-100

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 820
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (c)(3)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482106/820-10-50-2

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 820
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 6A
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 820
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 2E
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482106/820-10-50-2E

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 820
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 6A
-Subparagraph (h)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 820
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 6A
-Subparagraph (f)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 820
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 6A
-Subparagraph (e)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 820
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 6A
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 820
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (h)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482106/820-10-50-2

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Topic 820
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (g)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147482106/820-10-50-2

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Topic 940
-SubTopic 820
-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147478119/940-820-50-1

+ Details

Notes Receivable

12 Months Ended

Dec. 31, 2024

Receivables [Abstract]

Notes Receivable

5 — Notes Receivable

BAC provides financing solutions to qualified collectors and businesses by structuring loans secured by collector cars. The loans underwritten by BAC include term loans and short-term bridge financings. The loans underwritten by BAC are recorded on the Consolidated Balance Sheets within "Notes receivable".

Loans carry either a fixed or variable rate of interest and typically require periodic interest payments over the life of the loan with the principal amount due at maturity. Loans have an initial maturity of up to two years, often with an option for the borrower to renew for one year increments, provided the borrower remains in good standing, including maintaining a specified targeted LTV ratio for the loan. As of December 31, 2024, the loans underwritten by BAC were classified as Level 3 within the fair value hierarchy, with the carrying values of the loans approximating their fair values due to the relatively short-term maturities and the variable interest rates associated with most loans.

Beginning in December 2023, the lending activities of BAC are funded, in part, with borrowings drawn from the BAC Credit Facility, with the remainder funded by the Company's available liquidity. Prior to December 2023, the lending activities of BAC were funded primarily by the Company's available liquidity. Refer to Note 17 — Long-Term Debt for additional information regarding the BAC Credit Facility.

BAC aims to mitigate the risk associated with a potential devaluation in collateral by targeting an LTV ratio of 65% or less (i.e., the principal loan amount divided by the estimated value of the collateral at the time of underwriting). The LTV ratio is reassessed on a quarterly basis or if the loan is renewed. The LTV ratio is reassessed more frequently if there is a material change in the circumstances related to the loan, including if there is a material change in the value of the collateral, a material change in the borrower's disposal plans for the collateral, or if an event of default occurs. If, as a result of this reassessment, the LTV ratio increases above the target level, the borrower may be asked to make principal payments and/or post sufficient additional collateral to reduce the LTV ratio as a condition of future financing, renewal, or to avoid a default. In the event of a default by a borrower, BAC is entitled to sell the collateral to recover the outstanding principal, accrued interest balance, and any expenses incurred with respect to the recovery process.

Management considers the valuation of the underlying collateral and the LTV ratio to be the two most critical credit quality indicators for the loans made by BAC. In estimating the value of the underlying collateral for BAC's loans, management utilizes its expertise in the collector car market and considers an array of factors impacting the current and expected sale value of each car including the year, make, model, mileage, history, and in the case of classic cars, the provenance, quality of restoration (if applicable), the originality of the body, chassis, and mechanical components, and comparable market transaction values.

The repayment of BAC's loans can be adversely impacted by a borrower's deteriorating financial circumstances, a decline in the collector car market in general or in the value of the collateral, which may be concentrated within certain marques, vintages, or types of cars. In addition, in situations when BAC's claim on the collateral is subject to a legal dispute, the ability to realize proceeds from the collateral may be limited or delayed.

As of December 31, 2024, BAC's net notes receivable balance was $57.0 million, of which $45.4 million was classified within current assets and $11.6 million was classified within long-term assets on the Consolidated Balance Sheets. As of December 31, 2023, BAC's net notes receivable balance was $52.9 million, of which $35.9 million was classified within current assets and $17.0 million was classified within long-term assets on the Consolidated Balance Sheets. The classification of a loan as current or long-term is based on the contractual maturity date of the loan as of the balance sheet date.

The table below provides the aggregate LTV ratio for BAC's loan portfolio as of December 31, 2024 and 2023:


	December 31,
	2024			2023

	in thousands
Secured loans	$	56,972		$	52,914
Estimate of collateral value	$	95,778		$	108,496
Aggregate LTV ratio	59.5		%	48.8		%

As of December 31, 2024, two borrowers each had loan balances that exceeded 10% of the total loan portfolio. These loans total $18.3 million, representing 32% of the total loan portfolio. The collateral related to these loans was $32.3 million, resulting in an aggregate LTV ratio of 57%.

Management considers a loan to be past due when an interest payment is not paid within 10 business days of the monthly due date, or if the principal amount is not repaid by the contractual maturity date. Typically, a loan becomes past due only for a short period of time during which the loan is renewed or collateral is sold to satisfy the borrower's obligations. As of December 31, 2024 and 2023, the amount of past due principal and interest payments was not material.

A non-accrual loan is a loan for which future finance revenue is not recorded due to management's determination that it is probable that future interest on the loan will not be collectible. When a loan is placed on non-accrual status, any accrued interest receivable deemed not collectible is reversed against finance revenue. Any cash receipts subsequently received on non-accrual loans are first applied to reduce the recorded principal balance of the loan, with any proceeds in excess of the principal balance then applied to interest and expenses owed by the borrower. As of December 31, 2024 and 2023, there were no non-accrual loans.

As of December 31, 2024 and 2023, the allowance for expected credit losses related to the BAC loan portfolio was not material based on management's quarterly risk assessment, which takes into consideration a number of factors including the level of historical losses for similar loans, the quality of the collateral, the low LTV ratio of the loans, management's overall assessment of the current circumstances and risks related to each loan, and, to a lesser extent, the circumstances related to each borrower.

Other Assets

12 Months Ended

Dec. 31, 2024

Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]

Other Assets

7 — Other Assets

As of December 31, 2024 and 2023, other assets, current and long-term, consisted of:


	December 31,
	2024		2023

	in thousands
Prepaid SaaS implementation costs	$	41,110	$	21,941
Prepaid sales, general and administrative expenses	20,134		21,300
Deferred reinsurance premiums ceded	18,521		10,474
Inventory (1)	18,484		5,038
Reinsurance recoverable	11,927		2,783
Other investments	10,312		4,363
Contract costs	9,399		8,851
Accrued investment income	4,827		104
Deferred financing costs	3,489		5,053
Other	9,464		7,419
Other assets	$	147,667	$	87,326

(1) Inventory primarily includes vehicles owned by Broad Arrow that have been purchased for resale purposes.

As of December 31, 2024, Other primarily included $2.5 million of collector vehicle investments, $2.2 million related to capitalized digital media content, and a $2.0 million tax receivable. As of December 31, 2023, Other primarily included $2.7 million of collector vehicle investments, $2.2 million related to capitalized digital media content, and the $2.2 million fair value of an interest rate swap.

Property and Equipment

12 Months Ended

Dec. 31, 2024

Property, Plant and Equipment [Abstract]

Property and Equipment

8 — Property and Equipment

As of December 31, 2024 and 2023, property and equipment consisted of:


	December 31,
	2024		2023

	in thousands
Land and land improvements	$	421	$	930
Buildings	1,200		1,200
Leasehold improvements	8,518		9,005
Furniture and equipment	12,873		12,212
Computer equipment and software	21,663		20,922
Automobiles	877		697
Total property and equipment	45,552		44,966
Less: accumulated depreciation	(27,347)		(24,202)
Property and equipment, net	$	18,205	$	20,764

Property and equipment depreciation expense was $5.9 million, $6.2 million, and $6.6 million for the years ended December 31, 2024, 2023, and 2022, respectively.

Leases

12 Months Ended

Dec. 31, 2024

Leases [Abstract]

Leases

9 — Leases

The following table summarizes the components of the Company's operating lease expense for the years ended December 31, 2024, 2023, and 2022:


	Year ended December 31,
		2024		2023		2022

		in thousands
Operating lease expense (1)		$	8,053	$	11,681	$	10,737
Short-term lease expense (1)		125		378		187
Variable lease expense (1) (2)		3,445		4,307		3,943
Sublease revenue (3)		(1,283)		(704)		(156)
Lease cost, net		$	10,340	$	15,662	$	14,711

(1) Classified within "General and administrative expenses" on the Consolidated Statements of Operations.

(2) Amounts include payments for maintenance, taxes, insurance, and payments affected by the CPI.

(3) Classified within "Membership, marketplace and other revenue" on the Consolidated Statements of Operations.

The following tables summarize supplemental balance sheet information related to operating leases as of December 31, 2024 and 2023:


	December 31,
	2024			2023

	in thousands
Operating lease ROU assets	$	44,485		$	50,515

Current lease liabilities (1)	6,715			6,500
Long-term lease liabilities	43,178			50,459
Total operating lease liabilities	$	49,893		$	56,959


	December 31,
	2024			2023

	in thousands
ROU assets obtained in exchange for new operating lease liabilities	$	1,317		$	632
Weighted average lease term	8.23			9.01
Weighted average discount rate	5.0		%	4.8		%

(1) Current lease liabilities are recorded within "Accounts payable, accrued expenses and other current liabilities" on the Consolidated Balance Sheets.

The following table summarizes information about the amount and timing of the Company's future operating lease commitments as of December 31, 2024:


	in thousands
2025	$	9,018
2026	8,330
2027	7,944
2028	7,906
2029	6,097
Thereafter	22,107
Total lease payments	61,402
Less: imputed interest	(11,509)
Total lease liabilities	$	49,893

Acquisitions

12 Months Ended

Dec. 31, 2024

Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract]

Acquisitions

10 — Acquisitions

Consolidated National Insurance Company Acquisition

On September 1, 2024, the Company's subsidiary, Hagerty Insurance Holdings, Inc., acquired all of the issued and outstanding capital stock of Consolidated National Insurance Company, which was subsequently renamed Drivers Edge, for a purchase price of $19.3 million, including $0.9 million in direct and incremental transaction costs. The acquisition of Drivers Edge was accounted for as an asset acquisition with the $19.3 million purchase price allocated to approved state licenses ($11.3 million), cash and cash equivalents ($3.9 million), restricted fixed maturity securities ($3.7 million), and restricted cash and cash equivalents ($0.4 million).

Broad Arrow Acquisition

In January 2022, the Company entered into a joint venture with Broad Arrow, pursuant to which it invested $15.3 million in cash in exchange for equity ownership of approximately 40% of Broad Arrow. Following its entry into the joint venture, the Company used the equity method of accounting for its investment in Broad Arrow with its share of income (loss) recorded within "Loss from equity method investment, net of tax" on the Consolidated Statements of Operations.

In August 2022, the Company acquired the remaining 60% of Broad Arrow from the former Broad Arrow shareholders in exchange for equity consideration consisting of shares of the Company's Class A Common Stock and THG units (the "Broad Arrow Acquisition"). The number of Class A Common Stock shares and THG units issued was calculated using a 20-day volume weighted average stock price of the Class A Common Stock prior to the closing date on August 16, 2022. The fair value of the purchase consideration of $73.3 million was calculated based on the Class A Common Stock price of $13.47 as of the closing date. As a result of the Broad Arrow Acquisition, the Company and Broad Arrow are further leveraging their respective offerings to continue to build the Company's marketplace.

Fair Value of Consideration Transferred

The following table summarizes the fair value of Broad Arrow as of the date of the acquisition:


	in thousands
Total equity consideration	$	73,253
Fair value of previously held equity interest in Broad Arrow (1)	48,309
Total consideration and value to be allocated to net assets	$	121,562

(1) The Broad Arrow Acquisition was accounted for as a step acquisition. Accordingly, the Company remeasured its existing 40% equity interest in Broad Arrow immediately prior to the completion of the acquisition to its estimated fair value of $48.3 million. This fair value was derived from the Hagerty, Inc. Class A Common Stock price of $13.47 as of the closing date and thus represents a Level 1 fair value measurement. As a result of the remeasurement, the Company recorded a net gain of $34.7 million in the third quarter of 2022, representing the excess of the $48.3 million estimated fair value of its existing 40% equity interest over its closing date carrying value of $13.6 million.

Allocation of Consideration Transferred

The following table summarizes the allocation of the purchase consideration to the fair values of the identifiable assets acquired and liabilities assumed as of the date of the Broad Arrow Acquisition:


	in thousands
Notes receivable (1)	$	21,594
Intangible assets, net (2)	3,100
Other assets (3)	11,756
Other liabilities (4)	(13,449)
Total identifiable net assets acquired	23,001
Goodwill	98,561
Total purchase consideration allocated to net assets acquired	$	121,562

(1) Broad Arrow makes loans secured by collector cars. The fair value of the acquired loans approximated their carrying value due to the relatively short-term maturities and market rates of interest associated with most of the loans. Refer to Note 5 — Notes Receivable for additional information.

(2) The fair value of the identifiable intangible assets acquired is a Level 3 fair value measurement, estimated using significant assumptions that are not observable in the market through the use of a discounted cash flow model. Inputs utilized in this model include the discount rate and terminal growth rate, as well as the return on assets. Identifiable intangible assets acquired consisted of trade names of $3.1 million with a 5-year estimated useful life.

(3) Other assets includes $2.8 million of cash acquired, $2.6 million of Accounts receivable and $6.2 million of Other current assets.

(4) Other liabilities includes a $7.0 million Note payable, $5.3 million of Contract liabilities and $0.7 million of Accounts payable.

The excess of the purchase consideration over the aggregate estimated fair values of identifiable assets acquired, net of liabilities assumed, was recorded as goodwill within the Marketplace reporting unit. The goodwill is primarily a result of the expected enhancement of the Company's marketplace through Broad Arrow's platform which allows automotive enthusiasts to buy, sell, and finance collector cars and enthusiast vehicles, as well as Broad Arrow's assembled workforce and various other factors.

The acquisition of Broad Arrow was not material to the Company's Consolidated Statements of Operations. Therefore, pro forma results of operations related to this acquisition have not been presented. Following the Broad Arrow Acquisition, the financial statements of Broad Arrow are consolidated into the Company's Consolidated Financial Statements.

Speed Digital Acquisition

In April 2022, Hagerty acquired Speed Digital LLC ("Speed Digital") for a purchase price of $15.0 million. The Company paid $7.5 million at closing with an additional two annual installments of $3.75 million paid in each of 2023 and 2024. Speed Digital was previously wholly owned indirectly by Robert Kauffman, a member of the Company's Board of Directors (the "Board"), who received 100% of the proceeds of the purchase price. Speed Digital operates a SaaS business primarily serving collector car dealers and auction houses, and an advertising and content syndication platform, which includes Motorious.com. The Company acquired Speed Digital to enhance and grow its marketplace by establishing relationships with their dealer partners; augmenting the Company's automotive intelligence data; and allowing Motorious.com to drive audience engagement, content distribution, and advertising revenue.

Divestitures	12 Months Ended
Divestitures	Dec. 31, 2024
Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract]
Divestitures	11 — Divestitures In 2023, management began a review of certain components of the Company's operations which resulted in the sale or reorganization of certain businesses, including Hagerty Garage + Social, DriveShare, and Motorsport Reg ("MSR"), as discussed below. This initiative supports the Company's strategy to prioritize investments and resources in the areas of its business that offer the strongest growth and profit potential. Hagerty Garage + Social In the third quarter of 2023, Hagerty Ventures LLC ("HV"), a wholly owned subsidiary of THG, entered into an agreement with HGS Hub Holdings LLC ("H3") to terminate the joint venture agreement governing Member Hubs Holding, LLC ("MHH"), which operates as Hagerty Garage + Social. In connection with this agreement, H3's approximately 20% equity interest in MHH was redeemed and MHH's equity interests in the Palm Beach, Florida and Redmond, Washington locations of Hagerty Garage + Social were distributed to H3. Following the termination of the joint venture agreement, HV owns 100% of MHH and its remaining Hagerty Garage + Social locations in Delray Beach, Florida; Miami, Florida; Van Nuys, California; and Burlington, Ontario. As a result of the joint venture termination, the Company recognized a loss of $2.9 million in the third quarter of 2023, representing the difference between the fair value of the approximately 20% equity interest in MHH received by HV and the carrying value of the equity interests distributed to H3. The fair value of the approximately 20% equity interest received by MHH is a Level 3 fair value measurement and was determined using a combination of a discounted cash flow model and the adjusted book value method. This loss is recorded within "Gains, losses, and impairments related to divestitures" on the Company's Consolidated Statements of Operations. Immediately prior to the joint venture termination, MHH entered into an agreement to terminate the real estate lease held by the Culver City, California location of Hagerty Garage + Social. In connection with this lease termination agreement, MHH paid a termination fee funded by the Company and H3 in exchange for the extinguishment of its remaining obligations under the lease. As a result of this lease termination, the Company recognized a loss of $0.6 million in the third quarter of 2023, consisting of the lease termination fee paid to the landlord, partially offset by the net effect of the derecognition of the assets and liabilities related to the lease. This loss is reported within "Gains, losses, and impairments related to divestitures" on the Company's Consolidated Statements of Operations. Following this lease termination, MHH no longer operates a Hagerty Garage + Social location in Culver City, California. Hagerty DriveShare In the third quarter of 2023, THG entered into an agreement to sell Hagerty DriveShare, LLC ("DriveShare"), a peer-to-peer rental platform for collector vehicles, to a third party. The sale was completed on October 9, 2023. The Company recognized a $0.4 million loss related to this sale in the third quarter of 2023, which was recorded within "Gains, losses, and impairments related to divestitures" on the Company's Consolidated Statements of Operations. Motorsport Reg In the second quarter of 2024, THG entered into an agreement to sell substantially all of the assets and liabilities of MSR, a motorsport membership, licensing and event online management system, to a third party. The material elements of the sale consideration include a fixed purchase price and a contingent payment opportunity, based on future performance. The Company recognized a $0.1 million gain related to the sale of MSR in the second quarter of 2024, which was recorded within "Gains, losses, and impairments related to divestitures" on the Company's Consolidated Statements of Operations.

Goodwill and Intangible Assets

12 Months Ended

Dec. 31, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets

12 — Goodwill and Intangible Assets

Goodwill

The following is a reconciliation of changes in the Company's goodwill for the years ended December 31, 2024 and 2023:


	December 31,
	2024		2023

	in thousands
Goodwill as of January 1,	$	114,214	$	115,041

Divestitures	(22)		(846)
Effect of foreign currency translation	(69)		19
Goodwill as of December 31,	$	114,123	$	114,214

Refer to Note 11 — Divestitures for additional information related to divestitures, which resulted in the derecognition of goodwill during the years ended December 31, 2024 and 2023.

Intangible Assets

The cost and accumulated amortization of intangible assets as of December 31, 2024 and 2023 are as follows:


	December 31, 2024
	Weighted average useful life	Gross carrying amount		Accumulated amortization		Net carrying amount

		in thousands
Internally developed software	3.3	$	136,235	$	(82,903)	$	53,332
Renewal rights	9.9	19,187		(8,458)		10,729
Trade names and trademarks	14.1	12,061		(3,393)		8,668
State licenses (1)	Indefinite	11,263		—		11,263
Relationships and customer lists	15.4	7,975		(1,896)		6,079
Other	4.2	1,065		(1,029)		36
Total intangible assets		$	187,786	$	(97,679)	$	90,107

(1) Represents approved state licenses related to the acquisition of Drivers Edge. Refer to Note 10 — Acquisitions for additional details.


	December 31, 2023
	Weighted average useful life	Gross carrying amount		Accumulated amortization		Net carrying amount

		in thousands
Internally developed software	3.4	$	126,972	$	(66,186)	$	60,786
Renewal rights	10.0	20,226		(6,792)		13,434
Trade names and trademarks	14.0	12,541		(2,396)		10,145
Relationships and customer lists	15.7	8,876		(1,581)		7,295
Other	4.4	1,445		(1,181)		264
Total intangible assets		$	170,060	$	(78,136)	$	91,924

Intangible asset amortization expense was $26.7 million, $28.6 million, and $21.8 million for the years ended December 31, 2024, 2023, and 2022, respectively.

Estimated future aggregate amortization expense related to intangible assets as of December 31, 2024 is as follows:


	in thousands
2025	$	23,782
2026	18,067
2027	14,590
2028	8,439
2029	4,561
Thereafter	9,405
Total	$	78,844

Provision for Unpaid Losses and Loss Adjustment Expenses

12 Months Ended

Dec. 31, 2024

Insurance [Abstract]

Provision for Unpaid Losses and Loss Adjustment Expenses

13 — Provision for Unpaid Losses and Loss Adjustment Expenses

The following table presents Hagerty Re's provision for unpaid losses and loss adjustment expenses as of December 31, 2024 and 2023:


	December 31,
	2024		2023

	in thousands
Outstanding losses reported	$	94,489	$	84,651
IBNR	68,234		49,621
Net reserves for unpaid losses and loss adjustment expenses	162,723		134,272
Reinsurance recoverable on unpaid losses and loss adjustment expenses	5,769		2,235
Gross reserves for unpaid losses and loss adjustment expenses	$	168,492	$	136,507

The following table presents a reconciliation of the beginning and ending provision for unpaid losses and loss adjustment expenses related to Hagerty Re, net of amounts recoverable from various reinsurers:


	Year ended December 31,
		2024		2023		2022

		in thousands
Gross reserves for unpaid losses and loss adjustment expenses, beginning		$	136,507	$	111,741	$	74,869
Less: Reinsurance recoverable on unpaid losses and loss adjustment expenses		2,235		843		—
Net reserves for unpaid losses and loss adjustment expenses, beginning		134,272		110,898		74,869
Incurred losses and loss adjustment expenses:
Current accident year		299,918		228,358		186,478
Prior accident years		(1,325)		(7,700)		(4,076)
Total incurred losses and loss adjustment expenses		298,593		220,658		182,402
Payments:
Current accident year		186,267		138,263		109,555
Prior accident years		83,660		59,128		36,803
Total payments		269,927		197,391		146,358
Effect of foreign currency rate changes		(215)		107		(15)
Net reserves for unpaid losses and loss adjustment expenses, ending		162,723		134,272		110,898
Reinsurance recoverable on unpaid losses and loss adjustment expenses		5,769		2,235		843
Gross reserves for unpaid losses and loss adjustment expenses, ending		$	168,492	$	136,507	$	111,741

Losses and loss adjustment expenses for the year ended December 31, 2024 includes $23.0 million of pre-tax losses related to Hurricane Helene and $3.7 million of pre-tax losses related to Hurricane Milton.

During the year ended December 31, 2024, accident years 2017 through 2022 developed favorably by $4.3 million primarily due to better than expected loss development in U.S. auto physical damage claims. This favorable development was partially offset by $3.0 million of adverse development for the 2023 accident year due to the reevaluation and adjustment of certain actuarial assumptions based on observed trends.

Reserving Methodology

Reserves are reviewed by management quarterly and periodically throughout the year by combining historical results and current actual results to calculate new development factors. Claims are analyzed and reported based on the year in which the loss occurred - i.e., on an accident year basis. Accident year data is classified and utilized within actuarial models to prepare estimates of required reserves for payments to be made in the future.

When estimating reserves, the Company's actuarial reserving group utilizes several actuarial reserving methods which consider historical claim reporting patterns, claim cycle time, claim frequency and severity, claims settlement practices, adequacy of case reserves over time, seasonality, and current economic conditions. Reserve estimates produced by various actuarial reserving methods are further analyzed to determine the actuarial central estimate which represents the expected value over the range of reasonably possible outcomes.

The factors considered by management in estimating the provision for unpaid losses and loss adjustment expenses as of December 31, 2024 and 2023 include the following:

•the views of the Company's actuaries;

•historical trends in claim frequency and severity, including the impacts of adverse weather-related events;

•changes in claim cycle time and claim settlement practices;

•observed industry trends;

•the changing mix of business due to the large growth in modern collectible cars which carry a different risk profile than the risks associated with collector cars;

•inflation or deflation;

•retention limits under current catastrophe and treaty reinsurance programs; and

•legislative and judicial changes in the jurisdictions in which the Company operates.

The following factors are relevant to the additional information included in the tables below:

•Table organization: The tables are organized by accident year and include policies written on an occurrence basis.

•Groupings: Reserves for losses and loss adjustment expenses are grouped by line of business. The Company believes that losses included in each line of business have homogenous risk characteristics with similar development patterns and would generally be subject to similar trends.

•Claim counts: The Company considers a reported claim to be one claim for each claimant for each loss occurrence.

•Limitations: There are limitations that should be considered on the reported claim count data in the tables below, including that claim counts are presented only on a reported (not an ultimate) basis.

The following table presents a summary of total reserves for losses and loss adjustment expenses by line of business for the periods specified below:


	December 31,
	2024		2023

	in thousands
Gross reserves for unpaid losses and loss adjustment expenses
Auto	$	168,433	$	136,294
Marine	59		213
Total gross reserves for unpaid losses and loss adjustment expenses	$	168,492	$	136,507

Reinsurance recoverable on unpaid losses and loss adjustment expenses
Auto	$	5,769	$	2,235
Marine	—		—
Total reinsurance recoverable on unpaid losses and loss adjustment expenses	$	5,769	$	2,235

Net reserves for unpaid losses and loss adjustment expenses
Auto	$	162,664	$	134,059
Marine	59		213
Total net reserves for unpaid losses and loss adjustment expenses	$	162,723	$	134,272

The following table presents auto insurance incurred losses and loss adjustment expenses, by accident year, undiscounted and net of reinsurance recoveries:



											Reserves for Losses and Loss Adjustment Expenses Incurred But Not Reported		Cumulative Number of Reported Claims
	Reporting Years Ended December 31,
Accident Year	2020*		2021*		2022*		2023*		2024		As of December 31, 2024

	dollars in thousands
2020	$	90,110	$	86,608	$	85,111	$	84,311	$	84,162	$	900	27,225
2021			131,643		129,259		125,634		125,434		811		35,501
2022					186,073		182,783		179,096		3,408		39,427
2023							228,071		231,209		9,260		42,231
2024									299,766		53,563		41,316
Total									919,667		67,942		185,700
Cumulative paid losses and loss adjustment expenses from the table below									(758,059)		—
Reserves for losses and loss adjustment expenses before 2020, net of reinsurance									1,271		261
Effect of foreign currency rate changes									(215)		—
Reserves for losses and loss adjustment expenses, undiscounted and net of reinsurance									$	162,664	$	68,203

The following table presents auto insurance cumulative paid losses and loss adjustment expenses by accident year:




	As of December 31,
Accident Year	2020*		2021*		2022*		2023*		2024

	in thousands
2020	$	53,167	$	73,402	$	78,079	$	80,656	$	82,099
2021			75,933		105,475		114,884		120,094
2022					109,255		155,157		167,200
2023							138,102		202,501
2024									186,165
Total									$	758,059

* Unaudited required supplemental information.

The following table presents supplementary information about average historical claims duration as of December 31, 2024 based on the cumulative incurred and paid losses and allocated loss adjustment expenses presented above.


	Average Annual Percentage of Payout of Incurred Claims by Age (in Years), Net of Reinsurance (Unaudited)
Years	Year 1		Year 2		Year 3		Year 4		Year 5
Auto Insurance	61.3	%	25.1	%	6.2	%	3.2	%	1.8	%

15 — Statutory Capital and Surplus

Hagerty Re

Dividend Restrictions — Under Bermuda law, Hagerty Re is prohibited from declaring or issuing a dividend if it fails to meet its minimum solvency margin or minimum liquidity ratio. Prior approval from the Bermuda Monetary Authority ("BMA") is also required if Hagerty Re's proposed dividend payments would exceed 25% of its prior year-end total statutory capital and surplus. The amount of dividends which could be paid in 2025 without prior BMA approval is $67.9 million.

Capital Restrictions — In Bermuda, Hagerty Re is subject to the Bermuda Solvency Capital Requirement ("BSCR"), which is administered by the BMA. No regulatory action is taken by the BMA if an insurer’s capital and surplus is equal to or in excess of its enhanced capital requirement, as determined by the BSCR model. In addition, the BMA has established a target capital level for each insurer, which is 120% of the enhanced capital requirement. Hagerty Re maintained sufficient statutory capital and surplus to comply with the BCSR as of December 31, 2024.

Statutory Financial Information — Hagerty Re prepares its statutory financial statements in conformity with the accounting principles set forth in the Bermuda Insurance Act 1978, amendments thereto and related regulations. As of December 31, 2024 and 2023, the general business statutory capital and surplus of Hagerty Re was $271.5 million and $218.3 million, respectively. Statutory capital and surplus as of December 31, 2024 included $24.5 million of "Other Fixed Capital" represented by the State Farm Term Loan to Hagerty Re (as defined in Note 17 — Long-Term Debt). The general business statutory Net income of Hagerty Re was $53.1 million, $62.3 million, and $24.4 million for the years ended December 31, 2024, 2023, and 2022, respectively.

Drivers Edge

Dividend Restrictions — Drivers Edge is subject to the dividend restrictions set forth by the Colorado Division of Insurance (the "CDOI"). The CDOI limits the distribution of dividends to stockholders by property and casualty insurance companies in any year, without prior regulatory approval, to the lessor of (i) 10% of policyholders' surplus of the previous year-end, or (ii) net income for the prior year, minus realized capital gains, and minus any extraordinary dividends paid in the preceding twelve months. No dividends can be paid in 2025 without prior CDOI approval, as Drivers Edge is in a statutory net loss position for the year ended December 31, 2024.

Capital Restrictions — Drivers Edge is subject to National Association of Insurance Commissioners ("NAIC") Risk-Based Capital ("RBC") requirements, as adopted by the CDOI. The RBC requirements impose minimum statutory capital levels on insurance companies to ensure solvency for their policyholders. As of December 31, 2024, Drivers Edge exceeded its minimum statutory capital levels by $1.8 million.

Statutory Financial Information — In the U.S., state insurance laws and regulations prescribe accounting practices for determining statutory Net income and Capital and Surplus for insurance companies. The CDOI has adopted the NAIC accounting practices as the basis of its Statutory Accounting Practices ("SAP"). No differences exist between the CDOI and NAIC guidance. Drivers Edge's statutory capital and surplus was $7.1 million for the year ended December 31, 2024. Statutory net loss was $3.0 million for the year ended December 31, 2024.

Reinsurance

12 Months Ended

Dec. 31, 2024

SEC Schedule, 12-17, Insurance Companies, Reinsurance [Abstract]

Reinsurance

14 — Reinsurance

The following table presents Hagerty Re's total premiums assumed and ceded on a written and earned basis for the years ended December 31, 2024, 2023, and 2022:


	Year ended December 31,
		2024		2023		2022

		in thousands
Premiums written:
Assumed		$	726,971	$	636,366	$	474,294
Ceded		(50,541)		(33,070)		(10,749)
Net		$	676,430	$	603,296	$	463,545

Premiums earned:
Assumed		$	685,763	$	554,553	$	414,030
Ceded		(42,439)		(22,687)		(10,969)
Net		$	643,324	$	531,866	$	403,061

The following table presents gross, ceded, and net losses and loss adjustment expenses incurred for the years ended December 31, 2024, 2023, and 2022:


	Year ended December 31,
		2024		2023		2022

		in thousands
Gross losses and loss adjustment expenses		$	313,377	$	222,895	$	187,754
Ceded losses and loss adjustment expenses		(14,784)		(2,237)		(5,352)
Net losses and loss adjustment expenses		$	298,593	$	220,658	$	182,402

Ceded Reinsurance

Hagerty Re purchases catastrophe reinsurance to protect its capital from large catastrophic events and to provide earnings protection and stability. Hagerty Re renegotiated its catastrophe reinsurance coverage effective January 1, 2025, with terms and limits similar to 2024. The 2025 catastrophe reinsurance program for accounts with total insured values ("TIV") of up to $5.0 million affords coverage in excess of a per event retention of $28.0 million in two layers; $27.0 million excess of $28.0 million, and $50.0 million excess of $55.0 million. Additionally, Hagerty Re purchases semi-automatic facultative reinsurance to cede a portion of the physical damage exposure related to certain vehicles.

Beginning in 2023, Hagerty Re had quota share agreements with various reinsurers to cede 70% of its physical damage exposure on U.S. accounts written or renewed with TIV equal to or greater than $5.0 million ("High-Net-Worth Accounts"). These High-Net-Worth Accounts are assumed 100% from a wholly owned subsidiary of Markel. Effective January 1, 2024, Hagerty Re began ceding 100% of its High-Net-Worth Accounts physical damage exposure via quota share agreements with various reinsurers. Some of the reinsurers involved in these quota share agreements are related parties. Refer to Note 24 — Related-Party Transactions for additional information.

Hagerty Re receives ceding commissions related to premiums ceded under reinsurance contracts related to High-Net-Worth Accounts. Ceding commissions are recognized ratably over the terms of the related policies, which are generally 12 months, and are recorded within "Ceding commissions, net" in the Company's Consolidated Statements of Operations. Deferred portions of ceding commissions received are included in "Deferred acquisition costs, net" on the Company's Consolidated Balance Sheets.

Reinsurance Recoverables

The following table presents the reinsurance recoverable on paid and unpaid losses and loss adjustment expenses as of December 31, 2024 and 2023:


	December 31,
	2024		2023

	in thousands
Reinsurance recoverable on paid losses and loss adjustment expenses	$	6,158	$	548
Reinsurance recoverable on unpaid losses and loss adjustment expenses	5,769		2,235
Total reinsurance recoverable	$	11,927	$	2,783

Reinsurance contracts do not relieve Hagerty Re from its primary liability to the ceding carriers according to the terms of its reinsurance treaties. Failure of reinsurers to honor their obligations could result in additional losses to Hagerty Re. Hagerty Re evaluates the financial condition of its reinsurers and monitors concentration of credit risk arising from its exposure to individual reinsurers. All of Hagerty Re's reinsurers have an A.M. Best rating of A- (Excellent) or better, or fully collateralize their maximum obligation under the treaty.

Statutory Capital and Surplus

12 Months Ended

Dec. 31, 2024

Insurance [Abstract]

Statutory Capital and Surplus

13 — Provision for Unpaid Losses and Loss Adjustment Expenses

The following table presents Hagerty Re's provision for unpaid losses and loss adjustment expenses as of December 31, 2024 and 2023:


	December 31,
	2024		2023

	in thousands
Outstanding losses reported	$	94,489	$	84,651
IBNR	68,234		49,621
Net reserves for unpaid losses and loss adjustment expenses	162,723		134,272
Reinsurance recoverable on unpaid losses and loss adjustment expenses	5,769		2,235
Gross reserves for unpaid losses and loss adjustment expenses	$	168,492	$	136,507

The following table presents a reconciliation of the beginning and ending provision for unpaid losses and loss adjustment expenses related to Hagerty Re, net of amounts recoverable from various reinsurers:


	Year ended December 31,
		2024		2023		2022

		in thousands
Gross reserves for unpaid losses and loss adjustment expenses, beginning		$	136,507	$	111,741	$	74,869
Less: Reinsurance recoverable on unpaid losses and loss adjustment expenses		2,235		843		—
Net reserves for unpaid losses and loss adjustment expenses, beginning		134,272		110,898		74,869
Incurred losses and loss adjustment expenses:
Current accident year		299,918		228,358		186,478
Prior accident years		(1,325)		(7,700)		(4,076)
Total incurred losses and loss adjustment expenses		298,593		220,658		182,402
Payments:
Current accident year		186,267		138,263		109,555
Prior accident years		83,660		59,128		36,803
Total payments		269,927		197,391		146,358
Effect of foreign currency rate changes		(215)		107		(15)
Net reserves for unpaid losses and loss adjustment expenses, ending		162,723		134,272		110,898
Reinsurance recoverable on unpaid losses and loss adjustment expenses		5,769		2,235		843
Gross reserves for unpaid losses and loss adjustment expenses, ending		$	168,492	$	136,507	$	111,741