Hagerty Reports Third Quarter 2026 Results; Increases 2026 Growth Outlook

Year-to-date 2026 Highlights:

• Strong underlying operational performance with record increase in Members, Written Premium, and Earned Premium
• Written Premium grew 18% year-over-year to $1,099 million
  • Added a record 402,000 new members during the first nine months of 2026, with 18% policy in force growth to 1.9 million members
• Earned Premium increased 42% to $757 million
• Combined ratio for Hagerty Re of 85.2%, including $32 million of lower estimated losses, with $26 million related to the current accident year and $6 million for the 2025 accident year
• Transition to Markel Fronting Arrangement on January 1, 2026 resulted in decrease to reported revenue as previously disclosed
• Net Income of $32 million, including $189 million of pre-tax Markel Fronting Arrangement transitional costs, compared to Net Income of $121 million in the prior year period
• Adjusted EBITDA (a non-GAAP measure) increased 43% to $257 million, compared to $180 million in the prior year period
• Cash Flow from Operating Activities increased 48% to $280 million
• Increased 2026 Profit Outlook – Net Income range of $48–$60 million and Adjusted EBITDA range of $305–$315 million

TRAVERSE CITY, Mich., Nov. 3, 2026 /PRNewswire/ -- Hagerty, Inc. (NYSE: HGTY) makes it easier and more enjoyable for car enthusiasts to drive and celebrate the vehicles they love — through specialty vehicle insurance, live and digital auctions, engaging media and events, and the Hagerty Drivers Club, the world's largest membership community of car lovers. Today the company announced financial results for the three and nine months ended September 30, 2026.

"Third quarter results marked the continuation of the excellent business momentum from the first half of 2026. We grew written premium 18% during the first nine months as we added a record 402,000 new members. Net Income was $32 million and Adjusted EBITDA grew 43% to $257 million, reflecting strong written premium growth combined with the move to controlling 100% of the economics under the new Markel Fronting Arrangement. Given the strength of our results and current trajectory, we are again increasing our expectations for full year 2026," said McKeel Hagerty, Chief Executive Officer and Chairman of Hagerty.

"We have built one of the most engaging membership models in the automotive world. This differentiated approach powers sustained written premium growth from adding new members, deepening relationships and creating opportunities to sell other products and services. The Hagerty ecosystem is delivering, with record sales at Monterey car week and an 83% increase in auction sales so far this year," added Mr. Hagerty.

THIRD QUARTER 2026 FINANCIAL HIGHLIGHTS

• Third quarter 2026 Written Premium increased 16% year-over-year to $386 million, and year-to-date 2026 Written Premium increased 18% year-over-year to $1,099 million
• Third quarter 2026 Earned Premium increased 42% year-over-year to $265 million, and year-to-date 2026 Earned Premium increased 42% year-over-year to $757 million
  • Driven by the Markel Fronting Arrangement which increased Hagerty Re's U.S. quota share from 80% to 100% (including in-force policies written in 2025), as well as growth in subject premiums written by our MGA subsidiaries
  • Policies in Force Retention was 88.2% as of September 30, 2026 compared to 88.6% in the prior year period, and Policies in Force count increased 18% year-over-year to 1.9 million
• Third quarter 2026 MGA+ reporting unit Commission and fee revenue increased 16% to $160 million, and year-to-date 2026 MGA+ reporting unit Commission and fee revenue increased 17% year-over-year to $447 million, reflecting organic growth in the Essentia and State Farm books of business
  • Assuming control of the Essentia book through the Markel Fronting Arrangement on January 1, 2026 requires the elimination of $138 million of Commission and fee revenue in the third quarter of 2026 and $385 million in the year-to-date period in the Condensed Consolidated Statements of Operations
  • On a consolidated basis, third quarter 2026 Commission and fee revenue decreased 84% year-over-year to $22 million, and year-to-date 2026 Commission and fee revenue decreased 84% year-over-year to $62 million
• Third quarter 2026 Marketplace revenue decreased 6% year-over-year to $32 million, and year-to-date 2026 Marketplace revenue increased 8% year-over-year to $97 million
  • 83% year-to-date growth in auction sales was offset by lower inventory sales
• Third quarter 2026 Membership and other revenue increased 2% year-over-year to $22 million, and year-to-date 2026 Membership and other revenue increased 4% year-over-year to $65 million
  • Hagerty Drivers Club (HDC) paid members increased 6% year-over-year to over 977,000
• Third quarter 2026 Net investment income increased 25% year-over-year to $13 million, and year-to-date 2026 Net investment income increased 19% year-over-year to $34 million
• Third quarter 2026 Total Revenue decreased 9% year-over-year to $354 million, and year-to-date 2026 Total Revenue decreased 7% year-over-year to $1,021 million, reflecting the transition to the Markel Fronting Arrangement
• Third quarter 2026 Hagerty Re Loss Ratio was 32.6% compared to 42.0% in the prior year period, and year-to-date 2026 Hagerty Re Loss Ratio was 37.8% compared to 42.1% in the prior year period
  • Third quarter 2026 Hagerty Re Combined Ratio was 79.7% compared to 89.6% in the prior year period, and year-to-date 2026 Hagerty Re Combined Ratio was 85.2% compared to 89.3% in the prior year period
  • Third quarter 2026 Hagerty Re Loss and Combined Ratios were helped by a $26 million reduction to our estimate of loss and loss adjustment expenses for the current accident year recorded in the third quarter, and year-to-date also includes a $6 million reduction to our estimate of 2025 accident year losses recorded in the first quarter of 2026
• Third quarter 2026 Policy acquisition costs, net decreased 29% to $62 million, and year-to-date 2026 Policy acquisition costs, net were flat at $248 million. This variance is a result of a change in the composition of expenses following the transition of our business under the Markel Fronting Arrangement, partially offset by growth in earned premium.
• The transition to the Markel Fronting Arrangement and adoption of Article 7 reporting standards for insurance companies reclassified certain costs among expense captions on the Condensed Consolidated Statements of Operations, reducing period-over-period comparability of individual captions without affecting total expenses. Beginning in 2026, following our assumption of control over the Essentia book of business, operating costs incurred by our U.S. MGA subsidiary in support of risk-taking activities are classified within Underwriting and other insurance expenses, versus Selling, general, and administrative expenses
  • Together, third quarter 2026 Underwriting and other insurance expenses and Selling, general, and administrative expenses within the Insurance segment decreased 13% to $121 million, and year-to-date 2026 decreased 11% to $347 million. This decrease was primarily a result of the deferral of costs incurred by our MGA subsidiary for the successful acquisition or renewal of insurance policies issued under the Markel Fronting Arrangement. In 2025, these costs were expensed as incurred
• Third quarter 2026 Income before taxes of $41 million, including $36 million of Markel Fronting Arrangement transitional costs, and year-to-date 2026 Income before taxes of $23 million, including $189 million of Markel Fronting Arrangement transitional costs
• Third quarter 2026 Net Income of $36 million, including $36 million of pre-tax Markel Fronting Arrangement transitional costs, compared to Net Income of $46 million in the prior year period, and year-to-date 2026 Net Income of $32 million, compared to Net Income of $121 million in the prior year period, including $189 million of pre-tax Markel Fronting Arrangement transitional costs
• Third quarter 2026 Adjusted EBITDA (a non-GAAP measure) increased 64% year-over-year to $97 million, compared to $59 million in the prior year period, and year-to-date 2026 Adjusted EBITDA increased 43% year-over-year to $257 million, compared to $180 million in the prior year period
• Third quarter 2026 Basic and Diluted Earnings Per Share were both $0.08, and year-to-date 2026 Basic and Diluted Earnings Per Share were $0.00
• Third quarter 2026 Adjusted Diluted Earnings Per Share (a non-GAAP measure) was $0.10, and year-to-date 2026 Adjusted Diluted Earnings Per Share was $0.05
• Year-to-date 2026 Cash Flow from Operating Activities increased 48% to $280 million
• As of September 30, the Company had $461 million of unrestricted cash and $247 million of total debt, $103 million of which was back leverage for Broad Arrow Capital's portfolio of loans collateralized by collector cars

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

INCREASED 2026 OUTLOOK - COMPOUNDING GROWTH

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

• For full year 2026, Hagerty anticipates:
  • Written Premium growth of 16%–17%
  • Total Revenue change of (8)%–(7)%, as Markel-related commission revenue is eliminated under the Markel Fronting Arrangement¹
  • Net Income of $48 million–$60 million, including ~$199 million of Markel Fronting Arrangement transitional costs²
  • Adjusted EBITDA of $305 million–$315 million

Conference Call Details

Hagerty will hold a conference call to discuss the financial results on Tuesday, November 3, 2026 10:00 am Eastern Time. A webcast of the conference call, including its Investor Presentation highlighting third quarter 2026 financial results, will be available on Hagerty's investor relations website at investor.hagerty.com. To dial-in for the conference call, please register using the link found here to receive your unique dial-in and PIN. Please dial the number 10 minutes prior to the scheduled start time.

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

Forward-Looking Statements

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

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

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

About Hagerty, Inc. (NYSE: HGTY)

Hagerty is a company built by drivers for drivers, protecting 3.1 million vehicles in the United States, Canada and the UK. We make it easier and more enjoyable for car enthusiasts to drive and celebrate the vehicles they love through innovative vehicle insurance products, live and digital auctions, engaging media and events, and the Hagerty Drivers Club, the world's largest membership community of car lovers.

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

Category: Financial

Source: Hagerty

Key Performance Indicators and Non-GAAP Financial Measures

Key Performance Indicators

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

Adjusted EBITDA

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

How This Measure is Useful

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

Limitations of the Usefulness of This Measure

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

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

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

Adjusted Net Income and Adjusted Diluted EPS

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

How These Measures Are Useful

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

Limitations of the Usefulness of These Measures

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

Comparability Bridge

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

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