Hagerty Q2 Earnings Call Highlights

Hagerty reported strong second-quarter results, with written premium rising 19% and adjusted EBITDA increasing 32% year over year to $75 million. The company has raised its full-year 2026 guidance, now expecting 16%–17% written-premium growth, $18 million–$30 million in GAAP net income, and $270 million–$280 million in adjusted EBITDA. Hagerty surpassed 3 million insured vehicles and added a record 279,000 new members in the first half, partly due to State Farm policy conversions. The company also acquired U.K. motorcycle insurer Bennetts for £34 million, and its marketplace sales rose 17% to $65 million in the first half, driven by a 74% increase in Broad Arrow auction sales.

The company's reported GAAP revenue declined 6% to $667 million in the first half, despite strong written premium growth, due to changes in its Markel fronting arrangement. Under this arrangement, Hagerty reassumed 100% of U.S. underwriting risk starting January 1, increasing its participation in underwriting profits but distorting GAAP revenue presentation. Management expects these accounting effects to largely normalize by 2027. Hagerty reported GAAP net income of $8 million in the second quarter and a first-half GAAP net loss of $5 million. The company's second-quarter results included $64 million in amortization of deferred ceding commissions. Management anticipates a benefit from capitalized acquisition expenses to decline in the second half of the year.