Financial Data and Key Metrics Changes - Total revenue increased by 19% to $357 million in Q4 2025, with written premiums growing 19% due to robust new business count and a retention rate of 89% [14][15] - Net income surged 91% to $149 million for the full year 2025, driven by premium growth, cost discipline, and a $21 million reserve reduction [10][19] - Operating cash flow grew 24% to $219 million, reflecting strong cash generation capabilities [8][20] Business Line Data and Key Metrics Changes - Commission and fee revenue rose 18% to $106 million in Q4 2025, while earned premium grew 14% to $193 million [15][17] - Marketplace revenue increased by 80% to $29 million in Q4 2025, with total vehicle transactions reaching $624 million for the year [15][18] - The company welcomed a record 371,000 new members in 2025, contributing to a 14% increase in written premiums [8][9] Market Data and Key Metrics Changes - The company is targeting a 36 million vehicle market, currently capturing only 7% of this market [8] - The total transaction value of vehicles sold at auction and through private transactions reached $566 million, positioning the company as the number 2 global player in the market [9] Company Strategy and Development Direction - The company aims to enhance member experience and efficiency in delivering products and services, focusing on the implementation of a new fronting arrangement with Markel [12][13] - Strategic priorities for 2026 include expanding State Farm Classic Plus, refining distribution strategies, and continuing technology transformation [12][13] - The company plans to double its policies in force to 3 million by 2030, leveraging its differentiated model and brand strength [28] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism for 2026, anticipating written premium growth of 15%-16%, an acceleration from the previous year's 14% [22] - The company acknowledged transitional accounting changes due to the new Markel fronting arrangement, which may create temporary noise in reported results for 2026 [24][27] - Management emphasized the importance of AI in enhancing operational efficiency and personalizing member experiences [66][68] Other Important Information - The company has surpassed $1 billion in investment securities, primarily in high-grade corporate and government bonds [21] - A secondary share offering increased the company's float and trading volumes, contributing to a more distributed public company [11] Q&A Session Summary Question: Guidance on net loss number and comparison to 2025 net income - Management advised focusing on Adjusted EBITDA guidance, indicating a potential 10% growth compared to 2025 [31][34] Question: Ceding commission to Markel - Management confirmed the $190 million ceding commission is a solid number with no expected increases [37] Question: Loss ratio trends - Management indicated a planning loss ratio around 41%, with improvements expected in claims management [41][78] Question: Written premium guidance breakdown - Management refrained from breaking down written premium growth by category but noted State Farm's contribution to acceleration [44][45] Question: Marketplace revenue outlook - Management acknowledged the importance of Marketplace revenue but emphasized a focus on core insurance growth for 2026 [55][56] Question: Technology and AI opportunities - Management highlighted ongoing AI initiatives aimed at improving operational efficiency and personalizing member experiences [66][68] Question: Written premium per policy outlook - Management indicated that the influx of State Farm business may lower the average written premium per policy due to the nature of the vehicles insured [92][94] Question: Impact of deferred acquisition costs - Management confirmed a ramp-up in amortization of deferred acquisition costs throughout 2026, normalizing by 2027 [96][97]

Financial Data and Key Metrics Changes - Total revenue increased by 19% to $357 million in Q4 2025, with written premiums growing 19% due to robust new business count and a retention rate of 89% [13][14] - Net income surged 91% to $149 million for the full year 2025, driven by premium growth, cost discipline, and a $21 million reserve reduction [9][19] - Operating cash flow grew 24% to $219 million, reflecting strong cash generation capabilities [6][20] - Adjusted EBITDA for Q4 was $57 million, up 97% year-over-year, while full-year adjusted EBITDA grew 46% to $237 million [16][20] Business Line Data and Key Metrics Changes - Commission and fee revenue increased by 18% to $106 million in Q4 2025, while earned premium grew 14% to $193 million [14][17] - Marketplace revenue saw significant growth, increasing 80% to $29 million in Q4 and 119% to $119 million for the full year [14][17] - The company welcomed a record 371,000 new members in 2025, contributing to a total membership growth [6][8] Market Data and Key Metrics Changes - The company is targeting a 15%-16% growth in written premiums for 2026, an acceleration from the previous year's 14% [21] - The total transaction value of vehicles sold at auction and through private transactions reached $566 million, positioning the company as the number 2 global player in the market [8] Company Strategy and Development Direction - The company aims to enhance member experience and efficiency in delivering products and services, focusing on the implementation of a new fronting arrangement with Markel [11][12] - Strategic priorities for 2026 include expanding the State Farm Classic Plus program, refining distribution strategies, and continuing technology transformation [11][12] - The company is positioned to compound profit growth by targeting to double its policies in force to 3 million by 2030 [27] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to grow premiums and cash flow, citing a strong member-centric approach and innovative product offerings [4][5] - The management highlighted the importance of technology and AI in enhancing operational efficiency and personalizing member experiences [66][67] - The outlook for 2026 anticipates another year of record growth, despite accounting changes that may create temporary noise in reported results [21][26] Other Important Information - The company has transitioned to presenting consolidated financial statements in accordance with Article 7 for insurance companies, affecting how net investment income is reported [13] - The company has signed a new fronting arrangement with Markel, allowing it to retain 100% of the premium starting January 1, 2026 [9][19] Q&A Session Summary Question: Guidance on net loss number and comparison to 2025 net income - Management advised focusing on Adjusted EBITDA guidance, indicating a potential 10% growth compared to 2025 [31][32] Question: Ceding commission to Markel - Management confirmed the $190 million ceding commission is a solid number with no expected changes [35] Question: Loss ratio analysis - Management clarified that the loss ratio is expected to trend around 41% for 2026, with improvements in claims management [40][41] Question: Written premium guidance breakdown - Management refrained from breaking down written premium growth by category but noted that State Farm is expected to accelerate growth in 2026 [44] Question: Marketplace revenue outlook - Management acknowledged the importance of Marketplace revenue and indicated ongoing growth, though it may be variable [55][60] Question: AI opportunities in distribution - Management highlighted ongoing pilot programs for AI in marketing and lead generation, aiming to enhance distribution efficiency [87][88]

INVESTOR PRESENTATION Q4 2025 Speakers: McKeel Hagerty, Chief Executive Officer and Chairman Patrick McClymont, Chief Financial Officer Forward Looking Statements / Non-GAAP Financial Measures This presentation contains statements that constitute "forward- looking statements" within the meaning of the federal securities laws. All statements we provide, other than statements of historical fact, are forward-looking statements, including those regarding our future operating results and financial position, our ...

Group 1 - Hagerty, Inc. will report its fourth quarter 2025 financial results on February 26, 2026, before the market opens [1] - A conference call to discuss the financial results will be held at 10:00 am Eastern Time on the same day, with a live webcast available on the investor relations website [1] - The company protects 2.7 million vehicles across the United States, Canada, and the UK, focusing on enhancing the experience for driving enthusiasts [1] Group 2 - Hagerty offers innovative insurance products, live and digital auctions, and engaging media and events to support car enthusiasts [1] - The Hagerty Drivers Club is noted as the world's largest community of car lovers [1]

Core Insights - Hagerty, Inc. has promoted Marc Burns to Chief Marketing Officer and appointed Matt Teshera as Senior Vice President of Marketing to enhance member relationships and brand awareness [1][2][4] Group 1: Leadership Changes - Marc Burns will focus on growing new and deepening existing member relationships, building brand awareness, and delivering integrated membership experiences [2][4] - Matt Teshera, in his new role, will oversee marketing strategy, membership insights, and high-impact marketing execution, aiming to evolve membership into a bespoke, tiered experience [3][4] Group 2: Executive Background - Matt Teshera previously served as Vice President of Consumer Acquisition and Growth at AT&T, with extensive experience in integrated marketing strategy and execution [4][5] - Teshera holds an MBA in Marketing and Management from California State University, Long Beach, and emphasizes the opportunity to integrate marketing and membership ecosystems to enhance member value [5] Group 3: Company Overview - Hagerty protects 2.7 million vehicles across the United States, Canada, and the UK, focusing on making driving enjoyable for enthusiasts through innovative insurance products and community engagement [5]

Core Insights - Kenneth Ahn, President of Hagerty Marketplace, sold 50,000 shares of Hagerty, Inc. for approximately $620,500, which was part of a pre-planned trading strategy [1][6] - The company reported a record net income of $20.85 million in Q3 2025, marking a 327% year-over-year increase [7] - Hagerty's stock price increased by approximately 38% in 2025, indicating strong market performance [10] Transaction Summary - The transaction involved the sale of 50,000 shares at a value of $620,500, with a post-transaction direct ownership of 113,593 shares valued at $1.42 million [2] - The sale was executed under a Rule 10b5-1 trading plan, indicating it was pre-scheduled and not a discretionary decision [6] Company Overview - Hagerty is a specialty insurance and automotive lifestyle company, generating revenue primarily through insurance premiums, subscriptions, event fees, and ancillary services [5] - The company reported a total revenue of $1.36 billion and a net income of $33.32 million for the trailing twelve months [4] Unique Business Model - Hagerty differentiates itself from typical insurance companies by offering unique insurance policies for luxury vehicles and providing a subscription service, Hagerty Drivers Club, which includes various member benefits [8] Ownership Impact - The sale of shares eliminated all of Ahn's indirect equity exposure in Hagerty while maintaining his direct holdings [9] - The shares sold were previously held as Released Units of The Hagerty Group, LLC, which were converted into Class A Common Stock [9]

Financial Data and Key Metrics Changes - Total revenue increased by 18% to $380 million in Q3 2025, driven by a 16% increase in written premium and 18% growth in commission revenue [12][6] - Net income rose by 143% to $46 million compared to $19 million a year earlier, with adjusted EBITDA increasing by 106% to $50 million [16][12] - Operating margins improved by 590 basis points to 9%, with operating profit reaching $34 million, a 240% increase [13][12] Business Line Data and Key Metrics Changes - Membership, marketplace, and other revenue surged by 34% to $56 million, attributed to the launch of the European auction business and growth in inventory sales [12][6] - Earned premium in Hagerty Reinsurance increased by 12%, while the loss ratio for the quarter was 42%, resulting in a year-to-date combined ratio of 89% [12][16] Market Data and Key Metrics Changes - The company reported the highest policy-in-force (PIF) growth in its history in October, with significant contributions from the conversion of State Farm policies [6][12] - The company has established itself as a leading auction house, with a total global vehicle value sold at Broad Arrow Live Auctions reaching $240 million through November 1st [10][12] Company Strategy and Development Direction - The company aims to expand its specialty insurance offerings, simplify the membership experience, and grow its marketplace business internationally [10][9] - A new partnership with Liberty Mutual and Safeco was announced, which is expected to enhance customer engagement and retention [9][8] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the company's performance, highlighting a strong growth trajectory and the importance of long-term planning in the insurance industry [69][4] - The company expects to achieve 14%-15% revenue growth for the full year, with net income projected to grow by 58%-65% [17][12] Other Important Information - The company is transitioning to a new fronting arrangement with Markel, allowing it to control 100% of the premium and risk starting in 2026 [11][12] - A valuation allowance of $38 million was released, contributing to an income tax benefit [15][12] Q&A Session Summary Question: Can you provide quantification on the Liberty Mutual and Safeco partnership? - Management indicated it represents tens of thousands of customers and is a significant opportunity, although specific details were not disclosed [20][21] Question: What is the expected impact of the Enthusiast Plus rollout on PIF growth? - Management stated it is early days for Enthusiast Plus, and while they are optimistic, specific loss results are not yet available [23][24] Question: What is driving the acceleration in written premium growth? - Management noted that the growth is influenced by the seasonal nature of the business and the ongoing conversion of State Farm policies [26][27] Question: How will the transition to the Markel agreement impact liquidity and asset allocation? - Management confirmed that they have allocated investments into high-grade corporate and government bonds, providing protection against interest rate cuts [40][41] Question: What are the expectations for EBITDA growth in Q4? - Management indicated that Q4 is typically a lighter quarter with tighter margins, but no specific spending increases are planned [54][55] Question: How will the new policy acquisition costs impact earnings? - Management stated that it is still a work in progress and details will be shared once finalized [64][63]

Financial Performance - Total revenue grew by 18% to $1,068 million YTD Q3 2025[5] - Operating income increased by 78% to $108 million compared to $60 million[9] - Net income increased by 73% to $121 million compared to $70 million[9] - Adjusted EBITDA increased by 46% to $153 million compared to $105 million[9] Revenue Components - Commission and fee revenue increased by 14%[9] - Membership, Marketplace, and other revenue increased by 54%, with Marketplace growth at 135%[9] - Earned premium in Hagerty Re increased by 12%[9] Strategic Initiatives - Hagerty aims to double its policies in force to 3.0 million by 2030[10, 16] - Signed a new partnership with Liberty Mutual to offer enhanced collectible car insurance[7] - Announced a non-binding LOI for a new fronting arrangement with Markel, expecting to control 100% of the premium beginning in 2026[7, 17] Updated Outlook for 2025 - Total revenue is projected to be between $1,368 million and $1,380 million, representing a 14%-15% increase[44] - Net income is projected to be between $124 million and $129 million, representing a 58%-65% increase[44] - Adjusted EBITDA is projected to be between $170 million and $176 million, representing a 37%-41% increase[44]

Core Thesis - Hagerty, Inc. is positioned as a compelling investment opportunity within the classic-car insurance and enthusiast ecosystem, characterized by high-growth revenues and expanding margins [2][4]. Company Overview - Hagerty, Inc. shares were trading at $12.29 as of September 23rd, with trailing and forward P/E ratios of 61.45 and 27.32 respectively [1]. - The company dominates a niche market with high barriers to entry due to pricing complexity associated with vintage car rarity and VIN variability [2]. Business Model and Competitive Advantage - Hagerty utilizes proprietary data and valuation tools, providing a multi-year advantage in accurately pricing collectible cars [2]. - The company has a direct-to-consumer platform, agency partnerships, and ecosystem offerings such as the Hagerty Drivers Club and a marketplace for auctions and private sales, which enhance customer retention and create a defensible network effect [2]. Financial Performance - The insurance operation is highly profitable, featuring a low combined ratio and strong underwriting discipline [3]. - A transition to a fronting agreement with Markel allows for regulatory efficiency and full control over premiums and investments [3]. - Projected ROIC is above 18% against a 9% cost of capital, indicating substantial economic value creation [3]. Management and Customer Loyalty - The management team is deeply embedded in the business, contributing to operational excellence and brand loyalty, as evidenced by a high Net Promoter Score and over 90% customer retention [3]. Growth Potential - The auction business, led by experienced executives from Sotheby's and RM Sotheby's, is expected to grow significantly, leveraging Hagerty's niche brand and network for domestic and international expansion [3]. - The combination of a differentiated insurance franchise, ecosystem flywheel, and high-quality management provides a strong competitive moat and multi-year growth potential [4].

Financial Performance - Total revenue grew by 18% to $688 million[5] - Operating income increased by 46% to $73 million[9] - Net income increased by 46% to $74 million[9] - Adjusted EBITDA increased by 28% to $103 million[9] Revenue Components - Commission and fee revenue increased by 12%[9, 25] - Membership, Marketplace, and other revenue increased significantly by 68%[9, 25] Marketplace growth was 232%[9] - Earned premium in Hagerty Re grew by 12%[25] Future Outlook - The company aims to double policies in force to 30 million by 2030[10, 15] - Revised 2025 outlook projects total revenue between $1356 million and $1368 million, a 13%-14% increase[41] - Revised 2025 outlook projects net income between $112 million and $120 million, a 43%-53% increase[41] - Revised 2025 outlook projects Adjusted EBITDA between $162 million and $172 million, a 30%-38% increase[41] Strategic Initiatives - Hagerty entered into a non-binding LOI with Markel to control 100% of the premium in 2026[7, 16]