Form 8-K - Current report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934

November 8, 2023

Date of Report (date of earliest event reported)

HAGERTY, INC.

(Exact name of registrant as specified in its charter)


Delaware	001-40244	86-1213144
(State or other jurisdiction of incorporation or organization)	(Commission File Number)	(I.R.S. Employer Identification No.)

121 Drivers Edge

Traverse City, Michigan 49684

(Address of principal executive offices and zip code)

(800) 922-4050

Registrant's telephone number, including area code

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbols

Name of each exchange on which registered

Class A common stock, par value $0.0001 per share

HGTY

The New York Stock Exchange

Warrants, each whole warrant exercisable for one share
of Class A common stock, each at an exercise price of
$11.50 per share

HGTY.WS

The New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

ITEM 2.02 Results of Operations and Financial Condition

On November 8, 2023, Hagerty, Inc. (the "Company") announced its financial results for the fiscal quarter ended September 30, 2023 by issuing a letter to its stockholders and a press release. The Company will also be holding a conference call on November 8, 2023 to discuss its financial results for the three and nine months ended September 30, 2023. The full text of the Company's letter to its stockholders and press release are attached hereto as Exhibit 99.1 and Exhibit 99.2, respectively, and are incorporated herein by reference.

The information furnished pursuant to Item 2.02 of this Form 8-K, including Exhibits 99.1 and 99.2, shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act") or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference into any other filing under Securities Act of 1933, as amended ("Securities Act") or the Exchange Act, except as expressly set forth by specific reference in such a filing.

ITEM 7.01 Regulation FD Disclosure

On November 8, 2023, the Company posted to the investor relations page of its website an investor presentation expected to be used by the Company in connection with certain future presentations to investors and others. A copy of the investor presentation is attached as Exhibit 99.3 to this Current Report on Form 8-K.

The information contained in Item 7.01 of this Current Report on Form 8-K, including Exhibit 99.3, shall not be deemed to be "filed" for the purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that section, nor shall it be incorporated by reference into a filing under the Securities Act or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits


Exhibit No.						Description
99.1						Letter to Stockholders, dated November 8, 2023
99.2						Press Release, dated November 8, 2023
99.3						Investor Presentation, dated Nov ember 8, 2023
104						Cover Page Interactive Data File (formatted as Inline XBRL)

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.



						HAGERTY, INC.

						/s/ Diana M. Chafey
Date: November 8, 2023						Diana M. Chafey
						Chief Legal Officer

HAGERTY Q3 2023 | 2 For classic and enthusiast car owners, November is the time when we reminisce about the adventures of the past driving season (and a few flat- tire or popped gasket related misadventures) and begin to place some of our special cars into hibernation while dreaming about the season to come. At Hagerty, we are deep into planning 2024 and how we can better serve our members with the products and services they need to enjoy their vehicles. But at our heart, we are an automotive lifestyle insurance business. And a very good one. Let me share a few of the facts: » Hagerty is by far the biggest provider of specialty insurance for the collectible car market, insuring 2.4 million vehicles today, and consistently growing at a double-digit rate. » The road ahead looks promising, with approximately 45 million enthusiast vehicles in the U.S. worth an estimated $1 trillion. » Our business is as predictable as turkey on Thanksgiving, with more than 88 percent of our revenue baked in at the start of the year thanks to high customer retention. » Our Net Promoter Score of 83 is almost twice that of our competitors. » And year-to-date 2023 results are em- blematic of a great business model, with revenue growth of 28% and significantly improved profitability that will allow us to invest in lengthening our leadership position over the coming years. Dear Hagerty Stockholders, Members and One Team Hagerty, S T O C K H O L D E R L E T T E R Building a Community

HAGERTY Q3 2023 | 3 But those aren’t the only things that make Hagerty truly unique. We’re unique because we focus on passion. People love their cars. There is a vast community of car people out there – 67 million strong, by one estimate, more than the number of professed fitness enthusiasts. These car lovers can’t wait to spend their time and treasure on the hobby that has captured their hearts. To them – and to us – cars aren’t just conveyances, they are expressions of who they are and what they’re all about; a common language shared with other car lovers; and a shared interest that draws them closer to friends and family. We recognized this passion as an opportunity a long time ago and began creating services to meet the needs of this vast market beyond insurance, beginning with our proprietary Price Guide and Valuation Tools, which have become the gold standard for accurate, research-based car values in our industry. This is useful whether you value cars for insurance or buying and selling a car or just like following the trends. From there we moved into automotive media. Today, the Hagerty Media website, which celebrates the joy of driving and has become a respected authority on cars old and new, has 83 million lifetime page views and over 22,000 articles. 2.8 million subscribe to the Hagerty YouTube channel. Nearly one million readers can’t wait for each edition of Hagerty Drivers Club magazine, featuring the work of the nation’s best automotive journalists, to hit their mailbox. (Yes, it’s still a print magazine. Magazines, like steering wheels, are more fun when you can hold them in your hands.) In recent years, we have added a series of exciting and immersive live events to our ecosystem, not because they are money-makers, but because they allow us to engage with members in ways beyond just sending them an annual bill or helping them with a claim. The Amelia, the Detroit Concours, the Greenwich Concours, the California Mille, our luxurious Motorlux party at Monterey Car Week, our Radwood events, our popular Ride & Drives, tours and more act as on-ramps to the hobby to those who aren’t already converts. We have built a platform that can allow us to grow our share in the industry while simultaneously helping grow the pie. The core of our “protect, buy and sell, and enjoy” business vision – our pride and joy - is Hagerty Drivers Club (HDC). Launched in 2018, HDC has evolved into a rich value proposition serving more than 800,000 members, and is now the world’s largest membership organization for auto enthusiasts. For an annual fee of $70, members enjoy the award- winning HDC magazine, flat-bed towing and emergency roadside assistance, discounts on goods and services from our automotive partners, special members-only events, full access to our Valuation Tools, “Ask Hagerty,” a team of automotive experts to help answer any carrelated question, and free listings on Hagerty Classifieds. About 80 percent

HAGERTY Q3 2023 | 4 of our new insurance customers opt-in to become HDC members because the value is so compelling. HDC is the culmination of a dream for me. From the beginning, I have wanted Hagerty to serve as a global membership community for car enthusiasts – one that not only serves and assists car lovers but drives our unique and differentiated business model. We’ve made huge strides, but success always creates new challenges. Our challenge now is two-fold: How to make HDC an even richer value proposition for our members, which allows us to reinvest in the business and create value for our investors. Over the coming quarters, we’ll focus on making HDC even more useful, profitable and sticky. Some examples include a better digital user experience, improved bundling at point of sale, and establishing new, compelling partnerships for members. In the end, the best membership programs are the ones that build community. They thrive when they create real-life human interactions around a common passion and interest. That will continue to be our focus and I will update our progress for you in future letters. In the meantime, as always, thank you for being on this ride with us. Onward and upward! McKeel Hagerty CEO, Hagerty

For Immediate Release

Hagerty Reports Third Quarter 2023 Results

Increases 2023 Outlook

•Third quarter 2023 Total Revenue increased 27% to $275.6 million compared to the prior year period and year-to-date 2023 Total Revenue increased 28% to $755.2 million compared to the prior year period

•Third quarter 2023 Written Premium increased 15% year-over-year to $255.6 million, and year-to-date 2023 Written Premium increased 16% to $714.3 million compared to the prior year period

•Third quarter 2023 Membership, marketplace and other revenue increased 37% year-over-year to $32.6 million, and year-to-date 2023 Membership, marketplace and other revenue increased 47% to $82.7 million compared to the prior year period

•Third quarter 2023 Net Income decreased 23% to $18.6 million compared to the prior year period, and year-to-date 2023 Net Income decreased 45% to $19.1 million compared to the prior year period

•Third quarter 2023 Adjusted EBITDA of $37.4 million, an increase of $47.4 million compared to the prior year period, and year-to-date 2023 Adjusted EBITDA of $78.4 million, an increase of $78.4 million compared to the prior year period

TRAVERSE CITY, Mich., November 8, 2023 /PRNewswire/ – Hagerty, Inc. (NYSE: HGTY), an automotive lifestyle brand and a leading specialty insurance provider focused on the global automotive enthusiast market, today announced financial results for the three and nine months ended September 30, 2023.

“We again delivered strong revenue and cash flow growth in our third quarter, with a revenue increase of 27% and operating cash flow growth of 83% to $62 million,” said McKeel Hagerty, Chief Executive Officer of Hagerty. “2023 is turning out to be a banner year for Hagerty, with year-to-date revenue growth of 28%, propelled by written premium gains of 16%, earned premium growth of 32%, and membership and marketplace gains of 47%. Our focus on creating a more profitable business has driven dramatically improved margins through operational efficiencies, cost discipline, and economies of scale. Given our sustained business momentum, we now expect to hit the upper end of our prior full year revenue guidance of 23-27% and are once again increasing our 2023 outlook for both net income and Adjusted EBITDA, powered by better-than-expected flow-through to the bottom line.”

Mr. Hagerty continued, “Hagerty is at the beginning of what we believe will be a multi-year period of sustained revenue growth and strong incremental margins. I couldn’t be prouder of One Team Hagerty’s work as they fuel the passion for driving by helping car enthusiasts protect, buy and sell, and enjoy their vehicles."

THIRD QUARTER 2023 FINANCIAL HIGHLIGHTS

•Third quarter 2023 Written Premium increased 15% to $255.6 million compared to the prior year period, and year-to-date 2023 Written Premium increased 16% to $714.3 million compared to the prior year period.

•Third quarter 2023 Commission and fee revenue increased 21% to $103.2 million compared to the prior year period, and year-to-date 2023 Commission and fee revenue increased 18% to $288.0 million compared to the prior year period.

•Policies in Force Retention was 88.2% as of September 30, 2023 compared to 88.0% as of September 30, 2022. Total insured vehicles increased 6% year-over-year to 2.4 million compared to the prior year period.

•Third quarter 2023 Loss Ratio was 41.1% compared to 56.4% in the prior year period. Year-to-date 2023 Loss Ratio was 41.5% compared to 46.8% in the prior year period. The year-over-year

improvement was due in part to better underwriting results in the current year. In addition, prior year results included $10.0 million of catastrophe losses related to Hurricane Ian.

•Third quarter 2023 Earned premium increased 30% to $139.8 million compared to the prior year period, and year-to-date 2023 Earned premium increased 32% to $384.5 million compared to the prior year period.

•Earned premium growth was driven by the strong Written Premium growth as well as the increased quota share to approximately 80% compared to 70% in the prior year period.

•AM Best assigned a financial strength rating of A- (Excellent) to Hagerty Reinsurance Limited.

•Third quarter 2023 Membership, marketplace and other revenue increased 37% year-over-year to $32.6 million compared to the prior year period, and year-to-date 2023 Membership, marketplace and other revenue increased 47% to $82.7 million compared to the prior year period.

•Third quarter 2023 Marketplace revenue increased 87% to $13.0 million compared to the prior year period, and year-to-date 2023 Marketplace revenue increased 210% to $24.9 million compared to the prior year period.

•Third quarter 2023 Membership revenue increased 22% to $13.8 million compared to the prior year period, and year-to-date 2023 Membership revenue increased 20% to $39.5 million compared to the prior year period.

◦Hagerty Driver's Club (HDC) paid members increased 8% to approximately 807,000 compared to the prior year period.

•Third quarter 2023 Operating Income of $16.1 million compared to a Loss of $(21.2) million in the prior year period, and year-to-date 2023 Operating Income of $16.9 million compared to a Loss of $(31.8) million in the prior year period.

•Year-to-date 2023 results include restructuring charges of $8.9 million primarily associated with a reduction in force, reduced hiring plans and cost containment initiatives.

•Year-to-date 2023 results includes losses and impairments of $4.1 million related to the termination of the Garage + Social joint venture and the sale of DriveShare.

•Year-to-date 2023 depreciation and amortization was $34.9 million compared to $24.3 million in the prior year period. The increase was driven by a higher base of capital assets related to the digital platform which increased the expense by $4.8 million, as well as the $4.3 million impairment of media content assets during the first nine months of the year.

•Third quarter 2023 Net Income of $18.6 million compared to $24.3 million in the prior year period, and year-to-date 2023 Net Income of $19.1 million compared to $34.6 million in the prior year period.

•Net Income includes the impact from the change in fair value of warrant liabilities, the restructuring charges, as well as the impairment of media content assets.

•Third quarter 2023 Adjusted EBITDA of $37.4 million compared to $(10.0) million in the prior year period, and year-to-date 2023 Adjusted EBITDA of $78.4 million compared to $0.1 million in the prior year period.

•Third quarter 2023 Basic Earnings per Share was $0.04 and Diluted Earnings per Share was $0.04, and year-to-date 2023 Basic Earnings per Share was $0.04 and year-to-date Diluted Earnings per Share was $0.04.

•Third quarter 2023 Adjusted EPS was $0.05, and year-to-date 2023 Adjusted EPS was $0.05.

2023 OUTLOOK — GROWTH AND PROFITABILITY

Despite the uncertain macro environment, we are delivering strong results in 2023 and are well positioned to deliver sustained profitable growth over the coming years. We are confident that the opportunities we have identified to monetize our addressable market will expand our share, and we have thoughtfully prioritized our growth initiatives in 2023 to significantly improve our profitability and fund our purpose to save driving and fuel car culture for future generations. For full year 2023, we anticipate:

•Total Revenue growth of 26-27% powered by Written Premium growth of 15-16%

•Sustain double-digit Written Premium growth trajectory

•Deliver an unmatched online and live Marketplace experience

•Drive loyalty, referrals and incremental revenue and profit from Membership

•Continued evolution into an integrated insurance business

•Increase Hagerty Re’s quota share reinsurance agreement in the U.S. & U.K. to ~80%

•Significantly improved profitability through cost containment measures and operational efficiencies

•Net Income of $2-12 million

•Adjusted EBITDA of $75-85 million


	2023 Outlook		Prior Outlook at Q2 2023
in thousands	Low End	High End		Low End	High End
Total Revenue	$992,000	$1,000,000		$968,000	$1,000,000
Total Written Premium	$893,000	$901,000		$878,000	$894,000
Net Income	$2,000	$12,000		$(12,000)	$8,000
Adjusted EBITDA	$75,000	$85,000		$60,000	$80,000

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

Conference Call Details

Hagerty will hold a conference call to discuss the financial results today at 10:00 am Eastern Time. A webcast of the conference call, including the Company's Investor presentation highlighting third quarter and year-to-date 2023 financial results, will be available on Hagerty’s investor relations website at investor.hagerty.com. The dial-in for the conference call is (877) 423-9813 (toll-free) or (201) 689-8573 (international). 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 forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include all statements that are not historical facts. These forward-looking statements reflect Hagerty’s current expectations and projections with respect to its expected future business and financial performance, including, among other things: (i) expected operating results, such as revenue growth and increases in earned premium; (ii) changes in the market for Hagerty’s products and services, (iii) Hagerty’s plans to expand market share, including planned investments and partnerships; (iv) anticipated business objectives; and (v) the strength of Hagerty’s business model. These statements may be preceded by, followed by or include the words "aim," "anticipate," "believe," "estimate," "expect," "forecast," "future," "goal," "intend," "likely," "outlook," "plan," "potential," "project," "seek," "target," "can," "could," "may," "should," "would," "will," the negatives thereof and other words and terms of similar meaning.

A number of factors could cause actual results or outcomes to differ materially from those indicated by these forward-looking statements. These factors include, among other things, Hagerty’s ability to: (i) compete effectively within its industry and attract and retain members; (ii) maintain key strategic relationships with its insurance distribution and underwriting carrier partners; (iii) prevent, monitor and detect fraudulent activity; (iv) manage risks associated with disruptions, interruptions, outages with its technology platforms or third-party services; (v) accelerate the adoption of Hagerty’s membership products as well as any new insurance programs and products; (vi) manage the cyclical nature of the insurance business including through any periods of recession, economic downturn or inflation; (vii) address unexpected increases in the frequency or severity of claims; (vii) comply with the numerous laws and regulations applicable to Hagerty’s business, including state, federal and foreign laws relating to insurance and rate increases, privacy, the internet and accounting matters; (ix) manage risks associated with being a controlled company; and (x) other risks and uncertainties indicated from time to time in documents filed or to be filed with the Securities and Exchange Commission (the "SEC") by Hagerty.

The forward-looking statements herein represent the judgment of Hagerty as of the date of this release and Hagerty disclaims any intent or obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments, or otherwise. This press release should be read in conjunction with the information included in the Company's other press releases, reports and other filings with the SEC. Understanding the information contained in these filings is important in order to fully understand Hagerty’s reported financial results and our business outlook for future periods.

About Hagerty, Inc. (NYSE: HGTY)

Hagerty is an automotive lifestyle brand committed to saving driving and fueling car culture for future generations. The company is a leading provider of specialty vehicle insurance, expert car valuation data and insights, live and digital car auction services, immersive events and automotive entertainment custom made for the 67 million Americans who self-describe as car enthusiasts. Hagerty also operates in Canada and the U.K. and is home to Hagerty Drivers Club, a community of over 800,000 who can’t get enough of cars. As a purpose-driven organization, Hagerty Impact aims to be a catalyst for positive change across the issues that matter most to our teams, our members, the broader automotive community, our shareholders and the planet at large. For more information, please visit www.hagerty.com or connect with us on Facebook, Instagram, Twitter and LinkedIn.

More information can be found at newsroom.hagerty.com.

Contact: Jay Koval, investor@hagerty.com

Hagerty Media Contact: Andrew Heller, aheller@hagerty.com

Category: Financial

Source: Hagerty

Hagerty, Inc.

Condensed Consolidated Statements of Operations (Unaudited)


	Three months ended September 30,
	2023		2022		$ Change		% Change

REVENUE:	in thousands (except percentages and per share amounts)
Commission and fee revenue	$	103,173	$	85,457	$	17,716	20.7	%
Earned premium	139,785		107,487		32,298		30.0	%
Membership, marketplace and other revenue	32,616		23,813		8,803		37.0	%
Total revenue	275,574		216,757		58,817		27.1	%
OPERATING EXPENSES:
Salaries and benefits	51,318		50,120		1,198		2.4	%
Ceding commission	65,413		50,415		14,998		29.7	%
Losses and loss adjustment expenses	57,485		60,605		(3,120)		(5.1)	%
Sales expense	47,737		44,097		3,640		8.3	%
General and administrative services	22,166		23,853		(1,687)		(7.1)	%
Depreciation and amortization	10,753		8,890		1,863		21.0	%
Restructuring, impairment and related charges, net	473		—		473		100.0	%
Losses and impairments related to divestitures	4,112		—		4,112		100.0	%
Total operating expenses	259,457		237,980		21,477		9.0	%
OPERATING INCOME (LOSS)	16,117		(21,223)		37,340		175.9	%
Change in fair value of warrant liabilities	850		11,583		(10,733)		(92.7)	%
Revaluation gain on previously held equity method investment	—		34,735		(34,735)		(100.0)	%
Interest and other income (expense)	6,260		662		5,598		845.6	%
INCOME (LOSS) BEFORE INCOME TAX EXPENSE	23,227		25,757		(2,530)		(9.8)	%
Income tax benefit (expense)	(4,604)		91		(4,695)		(5159.3)	%
Income (loss) from equity method investment, net of tax	—		(1,535)		1,535		100.0	%
NET INCOME (LOSS)	18,623		24,313		(5,690)		(23.4)	%
Net loss (income) attributable to non-controlling interest	(13,269)		(9,599)		(3,670)		38.2	%
Accretion of Series A Convertible Preferred Stock	(1,838)		—		(1,838)		100.0	%
NET INCOME (LOSS) ATTRIBUTABLE TO CLASS A COMMON STOCKHOLDERS	$	3,516	$	14,714	$	(11,198)	(76.1)	%

Earnings (loss) per share of Class A Common Stock:
Basic	$	0.04	$	0.18
Diluted	$	0.04	$	0.07

Weighted-average shares of Class A Common Stock outstanding:
Basic	84,479		82,816
Diluted	84,479		336,768

Hagerty, Inc.

Condensed Consolidated Statements of Operations (Unaudited)


	Nine months ended September 30,
	2023		2022		$ Change		% Change

REVENUE:	in thousands (except percentages and per share amounts)
Commission and fee revenue	$	287,972	$	243,424	$	44,548	18.3	%
Earned premium	384,498		290,719		93,779		32.3	%
Membership, marketplace and other revenue	82,700		56,442		26,258		46.5	%
Total revenue	755,170		590,585		164,585		27.9	%
OPERATING EXPENSES:
Salaries and benefits	160,122		149,867		10,255		6.8	%
Ceding commission	181,188		138,048		43,140		31.3	%
Losses and loss adjustment expenses	159,461		136,144		23,317		17.1	%
Sales expense	124,791		109,989		14,802		13.5	%
General and administrative services	64,865		64,040		825		1.3	%
Depreciation and amortization	34,893		24,337		10,556		43.4	%
Restructuring, impairment and related charges, net	8,857		—		8,857		100.0	%
Losses and impairments related to divestitures	4,112		—		4,112		100.0	%
Total operating expenses	738,289		622,425		115,864		18.6	%
OPERATING INCOME (LOSS)	16,881		(31,840)		48,721		153.0	%
Change in fair value of warrant liabilities	(1,419)		37,869		(39,288)		(103.7)	%
Revaluation gain on previously held equity method investment	—		34,735		(34,735)		(100.0)	%
Interest and other income (expense)	15,677		(375)		16,052		4,280.5	%
INCOME (LOSS) BEFORE INCOME TAX EXPENSE	31,139		40,389		(9,250)		(22.9)	%
Income tax benefit (expense)	(12,002)		(4,077)		(7,925)		(194.4)	%
Income (loss) from equity method investment, net of tax	—		(1,676)		1,676		100.0	%
NET INCOME (LOSS)	19,137		34,636		(15,499)		(44.7)	%
Net loss (income) attributable to non-controlling interest	(13,477)		2,049		(15,526)		(757.7)	%
Accretion of Series A Convertible Preferred Stock	(1,838)		—		(1,838)		100.0	%
NET INCOME (LOSS) ATTRIBUTABLE TO CLASS A COMMON STOCKHOLDERS	$	3,822	$	36,685	$	(32,863)	(89.6)	%

Earnings (loss) per share of Class A Common Stock:
Basic	$	0.04	$	0.44
Diluted	$	0.04	$	0.03

Weighted-average shares of Class A Common Stock outstanding:
Basic	84,042		82,569
Diluted	84,042		335,392

Hagerty, Inc.

Condensed Consolidated Balance Sheets (Unaudited)


	September 30, 2023		December 31, 2022

ASSETS	in thousands (except share amounts)
Current Assets:
Cash and cash equivalents	$	90,710	$	95,172
Restricted cash and cash equivalents	594,865		444,019
Accounts receivable	81,960		58,255
Premiums receivable	179,168		100,700
Commissions receivable	63,192		60,151
Notes receivable	26,828		25,493
Deferred acquisition costs, net	155,278		107,342
Other current assets	56,783		45,651
Total current assets	1,248,784		936,783
Notes receivable	13,329		11,934
Property and equipment, net	21,518		25,256
Lease right-of-use assets	52,113		82,398
Intangible assets, net	95,776		104,024
Goodwill	114,198		115,041
Other long-term assets	37,959		37,082
TOTAL ASSETS	$	1,583,677	$	1,312,518
LIABILITIES, TEMPORARY EQUITY AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable, accrued expenses and other current liabilities	$	75,963	$	77,049
Losses payable and provision for unpaid losses and loss adjustment expenses	190,784		167,257
Commissions payable	111,657		77,075
Due to insurers	113,485		68,171
Advanced premiums	28,881		17,084
Unearned premiums	335,901		235,462
Contract liabilities	33,954		25,257
Total current liabilities	890,625		667,355
Long-term lease liabilities	52,022		80,772
Long-term debt, net	75,764		108,280
Warrant liabilities	46,980		45,561
Deferred tax liability	17,892		12,850
Contract liabilities	17,835		19,169
Other long-term liabilities	3,972		11,162
TOTAL LIABILITIES	1,105,090		945,149
Commitments and Contingencies	—		—
TEMPORARY EQUITY(1)
Preferred stock, $0.0001 par value (20,000,000 shares authorized, 8,483,561 Series A Convertible Preferred Stock issued and outstanding as of September 30, 2023 and no shares issued and outstanding as of December 31, 2022)	80,997		—
STOCKHOLDERS' EQUITY
Class A Common Stock, $0.0001 par value (500,000,000 shares authorized, 84,479,065 and 83,202,969 issued and outstanding as of September 30, 2023 and December 31, 2022, respectively)	8		8
Class V Common Stock, $0.0001 par value (300,000,000 authorized, 251,033,906 shares issued and outstanding as of September 30, 2023 and December 31, 2022)	25		25
Additional paid-in capital	557,961		549,034
Accumulated earnings (deficit)	(483,566)		(489,602)
Accumulated other comprehensive income (loss)	(176)		(213)
Total stockholders' equity	74,252		59,252
Non-controlling interest	323,338		308,117
Total equity	397,590		367,369
TOTAL LIABILITIES, TEMPORARY EQUITY AND STOCKHOLDERS' EQUITY	$	1,583,677	$	1,312,518

(1) The Series A Convertible Preferred Stock is recorded within Temporary Equity because it has equity conversion and cash redemption features.

Hagerty, Inc.

Condensed Consolidated Statements of Cash Flows (Unaudited)


	Nine months ended September 30,
	2023		2022

OPERATING ACTIVITIES:	in thousands
Net income (loss)	$	19,137	$	34,636
Adjustments to reconcile net income (loss) to net cash from operating activities:
Change in fair value of warrant liabilities	1,419		(37,869)
Loss on equity method investment	—		1,676
Revaluation gain on previously held equity method investment	—		(34,735)
Depreciation and amortization	34,893		24,337
Provision for deferred taxes	4,973		3,373
Impairment of operating lease right-of-use assets	1,147		—
Loss on disposals of equipment, software and other assets	2,019		1,131
Losses and impairments related to divestitures	2,827		—
Share-based compensation expense	13,157		8,165
Other	1,162		242
Changes in operating assets and liabilities:
Accounts, premiums and commission receivable	(107,001)		(71,753)
Deferred acquisition costs	(47,936)		(32,637)
Losses payable and provision for unpaid losses and loss adjustment expenses	23,527		53,574
Commissions payable	34,582		21,109
Due to insurers	45,322		40,876
Advanced premiums	11,800		10,363
Unearned premiums	100,439		74,624
Other assets and liabilities, net	(9,246)		(3,549)
Net Cash Provided by Operating Activities	132,221		93,563
INVESTING ACTIVITIES:
Capital expenditures	(21,556)		(33,429)
Acquisitions, net of cash acquired	(8,690)		(12,715)
Purchase of previously held equity method investment	—		(15,250)
Issuance of note receivable to previously held equity method investment	—		(7,000)
Issuance of notes receivable	(11,405)		(8,391)
Collection of notes receivable	10,252		—
Purchase of fixed income securities	(7,277)		(2,448)
Maturities of fixed income securities	4,128		1,216
Other investing activities	86		(1,662)
Net Cash Used in Investing Activities	(34,462)		(79,679)
FINANCING ACTIVITIES:
Payments on long-term debt	(132,850)		(90,500)
Proceeds from long-term debt, net of issuance costs	100,345		91,000
Proceeds from issuance of preferred stock, net of issuance costs	79,159		—

Contribution from non-controlling interest	779		1,000
Payments on notes payable	—		(1,000)
Proceeds from issuance of common stock under employee stock purchase plan	906		—
Net Cash Provided by (Used in) Financing Activities	48,339		500
Effect of exchange rate changes on cash and cash equivalents and restricted cash and cash equivalents	286		(2,023)

Change in cash and cash equivalents and restricted cash and cash equivalents	146,384		12,361
Beginning cash and cash equivalents and restricted cash and cash equivalents	539,191		603,972
Ending cash and cash equivalents and restricted cash and cash equivalents	$	685,575	$	616,333

Hagerty, Inc.

Key Performance Indicators and Certain Non-GAAP Financial Measures

Key Performance Indicators

The tables below present a summary of our Key Performance Indicators, including important operational metrics, as well as certain GAAP and non-GAAP financial measures as of and for the periods presented. 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 the Company's performance when read together with our Condensed Consolidated Financial Statements prepared in accordance with GAAP.


	Three months ended September 30,						Nine months ended September 30,
	2023			2022			2023			2022
Operational Metrics
Total Written Premium (in thousands)	$	255,569		$	222,136		$	714,314		$	614,623
Loss Ratio	41.1		%	56.4		%	41.5		%	46.8		%
New Business Count — Insurance	69,691			68,561			201,593			190,997








GAAP Measures
Total Revenue (in thousands)	$	275,574		$	216,757		$	755,170		$	590,585
Operating Income (Loss) (in thousands)	$	16,117		$	(21,223)		$	16,881		$	(31,840)
Net Income (Loss) (in thousands)	$	18,623		$	24,313		$	19,137		$	34,636
Basic Earnings (Loss) Per Share	$	0.04		$	0.18		$	0.04		$	0.44

Non-GAAP Financial Measures
Adjusted EBITDA (in thousands)	$	37,377		$	(10,010)		$	78,449		$	96
Adjusted Earnings (Loss) Per Share	$	0.05		$	(0.06)		$	0.05		$	(0.10)


	September 30, 2023		December 31, 2022
Operational Metrics
Policies in Force	1,387,429		1,315,977
Policies in Force Retention	88.2	%	88.0	%
Vehicles in Force	2,356,603		2,234,461
HDC Paid Member Count	806,832		752,754
Net Promoter Score (NPS)	83		83

Non-GAAP Financial Measures

Adjusted EBITDA

We define Adjusted EBITDA as consolidated Net income (loss) excluding interest and other income (expense), income tax (expense) benefit, and depreciation and amortization, adjusted to exclude (i) changes in fair value of warrant liabilities; (ii) share-based compensation expense; and when applicable, (iii) restructuring, impairment and related charges, net; (iv) the net gain or loss from asset disposals; (v) losses and impairments related to divestitures; (vi) revaluation gain on previously held equity method investment; and (vii) certain other unusual items.

We present Adjusted EBITDA because we consider it to be an important supplemental measure of the Company's performance and believe it is frequently used by securities analysts, investors, and other interested parties in the evaluation of companies in our industry. Management uses Adjusted EBITDA as a measure of the operating performance of our business on a consistent basis, as it removes the impact of items not directly resulting from our core operations.

By providing this non-GAAP financial measure, together with a reconciliation to net income (loss), which is the most comparable GAAP measure, we believe we are enhancing investors’ understanding of our business and our results of operations, as well as assisting investors in evaluating how well we are executing our strategic initiatives. However,

Adjusted EBITDA has limitations as an analytical tool, and should not be considered in isolation, or as an alternative to, or a substitute for net income (loss) or other financial statement data presented in our Condensed Consolidated Financial Statements as indicators of financial performance. Hagerty's Adjusted EBITDA may be determined or calculated differently than similarly titled measures of other companies in our industry, which could reduce the usefulness of this non-GAAP financial measure when comparing our performance to that of other companies.

The following table reconciles Adjusted EBITDA to the most directly comparable GAAP measure, which is Net income (loss):


	Three months ended September 30,				Nine months ended September 30,
	2023		2022		2023		2022

	in thousands
Net income (loss)	$	18,623	$	24,313	$	19,137	$	34,636
Interest and other (income) expense	(6,260)		(662)		(15,677)		375
Income tax (benefit) expense	4,604		(91)		12,002		4,077
Depreciation and amortization	10,753		8,890		34,893		24,337
Restructuring, impairment and related charges, net	473		—		8,857		—
Change in fair value of warrant liabilities	(850)		(11,583)		1,419		(37,869)
Share-based compensation expense	4,935		3,858		12,869		8,165
Losses and impairments related to divestitures	4,112		—		4,112		—
Revaluation gain previously held equity method investment	—		(34,735)		—		(34,735)
Other unusual items (1)	987		—		837		1,110
Adjusted EBITDA	$	37,377	$	(10,010)	$	78,449	$	96

(1) Other unusual items primarily includes a net legal settlement accrual recognized in the three and nine months ended September 30, 2023 and non-restructuring severance expense recognized in the nine months ended September 30, 2022.

The following table reconciles Adjusted EBITDA for the year ended December 31, 2023 Outlook to the most directly comparable GAAP measure, which is Net income (loss):


	2023 Low		2023 High

	in thousands
Net income (loss)	$	2,000	$	12,000
Interest and other (income) expense	(18,500)		(18,500)
Income tax (benefit) expense	15,500		15,500
Depreciation and amortization	44,112		44,112
Restructuring, impairment and related charges, net	8,857		8,857
Change in fair value of warrant liabilities	1,419		1,419
Share-based compensation expense	17,500		17,500
Losses and impairments related to divestitures	4,112		4,112
Adjusted EBITDA	$	75,000	$	85,000

Adjusted EPS

We define Adjusted Earnings (Loss) Per Share ("Adjusted EPS") as consolidated Net income (loss), less the change in fair value of our warrants and, when applicable, the revaluation gain on previously held equity method investment divided by our outstanding and total potentially dilutive securities, which includes (i) the weighted-average issued and outstanding shares of Class A Common Stock; (ii) all issued and outstanding non-controlling interest Hagerty Group Units; (iii) all unexercised warrants; (iv) all unissued share-based compensation awards; and (v) all issued and outstanding shares of the Series A Convertible Preferred Stock.

The most directly comparable GAAP measure is basic earnings per share ("Basic EPS"), which is calculated as Net income (loss) available to Class A Common Stockholders divided by the weighted average number of Class A Common Stock shares outstanding during the period.

We present Adjusted EPS because we consider it to be an important supplemental measure of our operating performance and believe it is used by securities analysts, investors and other interested parties in evaluating the consolidated performance of other companies in our industry. We also believe that Adjusted EPS, which compares our consolidated Net income (loss) with our outstanding and potentially dilutive shares, provides useful information to investors regarding our performance on a fully consolidated basis.

Management uses Adjusted EPS:

•as a measurement of operating performance of our business on a fully consolidated basis;

•to evaluate the performance and effectiveness of our operational strategies; and

•as a preferred predictor of core operating performance, comparisons to prior periods and competitive positioning.

We caution investors that Adjusted EPS is not a recognized measure 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, including Basic EPS, and that Adjusted EPS, as we define it, may be defined or calculated differently by other companies. In addition, Adjusted EPS has limitations as an analytical tool and should not be considered as a measure of profit or loss per share.

The following table reconciles Adjusted EPS to the most directly comparable GAAP measure, which is Basic EPS:


	Three months ended September 30,				Nine months ended September 30,
	2023		2022		2023		2022

	in thousands (except per share amounts)
Numerator:
Net income (loss) available to Class A Common Stockholders (1)	$	3,255	$	14,714	$	3,712	$	36,685
Undistributed earnings allocated to Series A Convertible Preferred Stock	261		—		110		—
Accretion of Series A Convertible Preferred Stock	1,838		—		1,838		—
Net income (loss) attributable to non-controlling interest	13,269		9,599		13,477		(2,049)
Consolidated net income (loss)	18,623		24,313		19,137		34,636
Change in fair value of warrant liabilities	(850)		(11,583)		1,419		(37,869)
Revaluation gain on previously held equity method investment	—		(34,735)		—		(34,735)
Adjusted consolidated net income (loss) (2)	$	17,773	$	(22,005)	$	20,556	$	(37,968)

Denominator:
Weighted average shares of Class A Common Stock outstanding — basic(1)	84,479		82,816		84,042		82,569
Total potentially dilutive securities outstanding:
Conversion of non-controlling interest Hagerty Group Units to Class A Common Stock	255,499		255,758		255,499		255,758
Conversion of Series A Convertible Preferred Stock to Class A Common Stock	6,785		—		6,785		—
Total unissued share-based compensation awards	8,490		6,878		8,490		6,878
Total warrants outstanding	19,484		19,484		19,484		19,484
Potentially dilutive shares outstanding	290,258		282,120		290,258		282,120
Fully dilutive shares outstanding (2)	374,737		364,936		374,300		364,689

Basic EPS(1)	$	0.04	$	0.18	$	0.04	$	0.44

Adjusted EPS(2)	$	0.05	$	(0.06)	$	0.05	$	(0.10)

(1) Numerator and Denominator of the GAAP measure Basic EPS

(2) Numerator and Denominator of the non-GAAP measure Adjusted EPS

HAGERTY Q3 2023 | 2 FORWARD LOOKING STATEMENTS / NON-GAAP FINANCIAL MEASURES This presentation contains statements that constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include all statements that are not historical facts. These forward-looking statements reflect our current expectations and projections with respect to our expected future business and financial performance, including, among other things: (i) expected operating results, such as revenue growth and financial position; (ii) changes in the market for our products and services; (iii) our plans to expand market share, including planned investments and partnerships; (iv) anticipated business objectives; and (v) the strength of our business model. These statements may be preceded by, followed by, or include the words “anticipate,” “believe,” “envision,” “estimate,” “expect,” “forecast,” “future,” “goal,” “intend,” “likely,” “outlook,” “plan,” “potential,” “project,” “seek,” “target,” “can,” “could,” “may,” “should,” “would,” “will,” the negatives thereof and other words and terms of similar meaning. A number of factors could cause actual results or outcomes to differ materially from those indicated by these forward-looking statements. These factors include, among other things, our ability to: (i) compete effectively within our industry and attract and retain members; (ii) maintain key strategic relationships with our 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 our technology platforms or our use of third-party services; (v) accelerate the adoption of our membership products as well as any new insurance programs and products we offer; (vi) manage the cyclical nature of the insurance business, including through any periods of recession, economic downturn or inflation; (vii) address unexpected increases in the frequency or severity of claims; (viii) comply with the numerous laws and regulations applicable to our business, including state, federal, and foreign laws relating to insurance and rate increases, privacy, the internet and accounting matters; (ix) manage risks associated with being a controlled company; and (x) successfully defend any litigation, government inquiries and investigation. The forward- looking statements herein represent our judgment as of the date of this release and we disclaim any intent or obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments, or otherwise. This presentation should be read in conjunction with the information included in our filings with the SEC and press releases. Understanding the information contained in these filings is important in order to fully understand our reported financial results and our business outlook for future periods. In addition, this presentation contains certain “non-GAAP financial measures”. The non-GAAP measures are presented for supplemental informational purposes only. Reconciliations to the most directly comparable financial measure calculated and presented in accordance with GAAP are provided in the appendix to this presentation.

HAGERTY Q3 2023 | 3 Total Revenue growth of 28% Written Premium growth of 16% Marketplace revenue of $25 million, growth of 210% Significantly improved profitability » Added over 200,000 new customers » Launched State Farm partnership in four states » Received financial strength rating of A- (Excellent) from AM Best » Net Income1 of $19 million compared to $35 million » Adjusted EBITDA2 of $78 million compared to $0 million 1 Net Income in the prior year period included a $35 million revaluation gain and a $38 million change in fair value of warrant liabilities. 2 See Appendix for additional information regarding this non-GAAP financial measure. 3 Total revenue growth of 26-27% and Total Written Premium growth of 15-16% expected in 2023. Y TD Q3 2023 HIGHLIGHTS INCREASED 2023 OUTLOOK IN THOUSANDS REVISED OUTLOOK PRIOR OUTLOOK Total Revenue3 $992,000-$1,00,000 $968,000-$1,000,000 Total Written Premium3 $893,000-$901,000 $878,000-$894,000 Net Income $2,000-$12,000 ($12,000)-$8,000 Adjusted EBITDA2 $75,000-$85,000 $60,000-$80,000 Deliver sustained top-line momentum in 2023 with significantly improved profitability

HAGERTY Q3 2023 | 4 » Hagerty Marketplace was created to help consumers buy and sell enthusiast vehicles. Large and growing market opportunity with ~300,000 cars transacting for ~$12.5 billion through Hagerty’s insurance book during 2022. » We seek to provide an unmatched online and live Marketplace experience for consumers by serving as the trusted brand for auto enthusiasts, offering certification services, title and escrow, financing options and other high-value services that differentiate our product from competitors. » Other material opportunities include insurance sales and Hagerty Driver’s Club (HDC) memberships. » Proven leadership team with strong cultural fit. HAGERT Y MARKETPLACE » During the first nine months of 2023, Marketplace delivered $24.9 million in revenue from live auctions, private sales, online marketplace as well as financing.

HAGERTY Q3 2023 | 5 » Began activating State Farm agents to offer State Farm Classic+ policies and Hagerty Drivers Club in four initial states in September of 2023 » 480,000+ existing collector car policies plus up to 75% HDC enrollment possible on new insurance policies sold by State Farm’s ~19,500 agents » Anticipated average annual revenue per customer: $85-$110 » State Farm aligned in the success of the 10-year commercial partnership with an initial $500 million investment in Hagerty in 2021 as well as an additional $50 million investment in June of 2023 and $25 million long-term financing for Hagerty Re HAGERT Y + STATE FARM PARTNERSHIP

Deliver sustained top-line momentum in 2023 with significantly improved profitability On track to deliver Total Revenue growth of 26-27% powered by Written Premium growth of 15-16% » Sustain double-digit Written Premium growth trajectory » Deliver an unmatched online and live Marketplace experience » Drive loyalty, referrals and incremental revenue and profit from Membership Continued evolution into an integrated insurance business » Increase Hagerty Re’s quota share reinsurance agreement in the U.S. and U.K. to ~80% Significantly improving profitability ($75 million to $85 million in Adjusted EBITDA1) through operational efficiencies and cost containment measures 1 See Appendix for additional information regarding this non-GAAP measure. 2023 PRIORITIES HAGERTY Q3 2023 | 6

HAGERTY Q3 2023 | 71 See Appendix for additional information regarding this non-GAAP measure. Y TD Q3 2023 FINANCIAL HIGHLIGHTS $755M +28% +16% $714M 41.5% 88.2% $17M $78M $19M $0.04

HAGERTY Q3 2023 | 8 1 Includes base commissions, payment plan fees and contingent underwriting commissions. 2 Currently applies to U.S. and U.K. programs. Generally described as an arrangement where underwriting risk and profit is shared proportionately. Total Revenue Commission + fee revenue (+18%) » Written premium growth of 16% » Policies in Force retention of 88% Membership, marketplace + other revenue (+47%) » Membership revenue growth of 20% » Marketplace revenue growth of 210% » 80% of new insurance customers joined Hagerty Drivers Club (HDC) Earned premium in Hagerty Re (+32%) » Contractual quota share2 increased to ~80% in 2023 YTD Q3 2023 Highlights REVENUE COMPONENTS Q3 YTD

HAGERTY Q3 2023 | 9 1 Other unusual items primarily includes a net legal settlement accrual recognized in the three and nine months ended September 30, 2023 and non-restructuring severance expense recognized in the nine months ended September 30, 2022. 2 See Appendix for additional information regarding this non-GAAP financial measure. Adjusted EBITDANet Income Adjusted EBITDA IN THOUSANDS Q3 2023 Q3 2022 YTD 2023 YTD 2022 Net income $18,623 $24,313 $19,137 $34,636 Interest and other (income) expense (6,260) (662) (15,677) 375 Income tax (benefit) expense 4,604 (91) 12,002 4,077 Depreciation and amortization 10,753 8,890 34,893 24,337 Restructuring, impairment and related charges, net 473 — 8,857 — Change in fair value of warrant liabilities (850) (11,583) 1,419 (37,869) Share-based compensation expense 4,935 3,858 12,869 8,165 Losses and impairments related to divestitures 4,112 — 4,112 — Revaluation gain previously held equity method investment — (34,735) — (34,735) Other unusual items1 987 — 837 1,110 Adjusted EBITDA2 $37,377 $(10,010) $78,449 $96 EARNINGS ANALYSIS 2023 2022 Q3 Q3YTD YTD

HAGERTY Q3 2023 | 10 Strong top-line momentum continuing in 2023 with significantly improved profitability 2023 Outlook Prior Outlook at Q2 2023 IN THOUSANDS Low End Range High End Range Low End Range High End Range Total Revenue1 $992,000 $1,000,000 $968,000 $1,000,000 Total Written Premium1 $893,000 $901,000 $878,000 $894,000 Net Income $2,000 $12,000 $(12,000) $8,000 Adjusted EBITDA2 $75,000 $85,000 $60,000 $80,000 2 See Appendix for additional information regarding this non-GAAP financial measure. 1 Total revenue growth of 26-27% and Total Written Premium growth of 15-16% expected in 2023. Strong top-line momentum continuing in 2023 with significantly improved profitability 2023 OUTLOOK: GROWTH AND PROFITABILIT Y

HAGERTY Q3 2023 | 12 Total Written Premium New Business Count (Insurance) $ IN THOUSANDS Q1 Q2 Q3 Q4 Total 2018 82,514 137,943 123,385 86,621 430,463 2019 96,732 158,501 142,030 99,747 497,010 2020 112,421 184,423 163,520 117,870 578,234 2021 133,707 208,091 192,091 140,417 674,306 2022 154,790 237,697 222,136 162,041 776,664 5 Year Average Total Written Premium % 20% 31% 29% 20% 100% Q1 Q2 Q3 Q4 Total 2018 32,610 56,729 51,795 35,356 176,490 2019 36,848 62,842 57,426 37,585 194,701 2020 41,510 70,622 73,619 50,914 236,665 2021 51,799 77,013 68,077 47,589 244,478 2022 47,514 74,922 68,561 43,523 234,520 5 Year Average New Business Count % 19% 32% 29% 20% 100% 0 50 100 150 200 250 0 10 20 30 40 50 60 70 80 90 North American footprint creates seasonal differences by quarter for written premium and new business count HISTORICAL SEASONALIT Y TRENDS

HAGERTY Q3 2023 | 13 Guest User Counts Q3 2022 Q3 2023 U.S. 1,183,201 1,305,743 Canada 79,271 85,892 Total Guest User Count 1,262,472 1,391,635 Paid Membership Counts U.S. Q3 2022 Q3 2023 Insurance Member 462,289 480,616 Insurance + HDC 660,304 709,468 HDC Standalone 29,769 33,237 Total U.S. Paid Member Count 1,152,362 1,223,321 Canada Insurance Member 82,728 84,713 Insurance + HDC 58,085 63,153 HDC Standalone 1,582 974 Total Canada Paid Member Count 142,395 148,840 Total Insurance Member 545,017 565,329 Insurance + HDC 718,389 772,621 HDC Standalone 31,351 34,211 Total HDC Paid Member Count 749,740 806,832 8% growth Total Paid Member Count 1,294,757 1,372,161 6% growth 1.4 million Paid Members (+6%) HAGERT Y MEMBERSHIP Total Member Count

HAGERTY Q3 2023 | 14 Adjusted EBITDA We define Adjusted EBITDA as consolidated Net income (loss) excluding interest and other income (expense), income tax (expense) benefit, and depreciation and amortization, adjusted to exclude (i) changes in fair value of warrant liabilities; (ii) share-based compensation expense; and when applicable, (iii) restructuring, impairment and related charges, net; (iv) the net gain or loss from asset disposals; (v) losses and impairments related to divestitures; (vi) revaluation gain on previously held equity method investment; and (vii) certain other unusual items. We present Adjusted EBITDA because we consider it to be an important supplemental measure of the Company's performance and believe it is frequently used by securities analysts, investors, and other interested parties in the evaluation of companies in our industry. Management uses Adjusted EBITDA as a measure of the operating performance of our business on a consistent basis, as it removes the impact of items not directly resulting from our core operations. By providing this non-GAAP financial measure, together with a reconciliation to net income (loss), which is the most comparable GAAP measure, we believe we are enhancing investors’ understanding of our business and our results of operations, as well as assisting investors in evaluating how well we are executing our strategic initiatives. However, Adjusted EBITDA has limitations as an analytical tool, and should not be considered in isolation, or as an alternative to, or a substitute for net income (loss) or other financial statement data presented in our Condensed Consolidated Financial Statements as indicators of financial performance. Hagerty's Adjusted EBITDA may be determined or calculated differently than similarly titled measures of other companies in our industry, which could reduce the usefulness of this non-GAAP financial measure when comparing our performance to that of other companies. IN THOUSANDS Q3 2023 Q3 2022 YTD 2023 YTD 2022 Net income $18,623 $24,313 $19,137 $34,636 Interest and other (income) expense (6,260) (662) (15,677) 375 Income tax (benefit) expense 4,604 (91) 12,002 4,077 Depreciation and amortization 10,753 8,890 34,893 24,337 Restructuring, impairment and related charges, net 473 — 8,857 — Change in fair value of warrant liabilities (850) (11,583) 1,419 (37,869) Share-based compensation expense 4,935 3,858 12,869 8,165 Losses and impairments related to divestitures 4,112 — 4,112 — Revaluation gain previously held equity method investment — (34,735) — (34,735) Other unusual items 987 — 837 1,110 Adjusted EBITDA $37,377 $(10,010) $78,449 $96 RECONCILIATION OF NON-GAAP METRICS Net Income to Adjusted EBITDA

HAGERTY Q3 2023 | 15 Adjusted EPS The most directly comparable GAAP measure is basic earnings per share ("Basic EPS"), which is calculated as Net income (loss) available to Class A Common Stockholders divided by the weighted average number of Class A Common Stock shares outstanding during the period. We caution investors that Adjusted EPS is not a recognized measure 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, including Basic EPS, and that Adjusted EPS, as we define it, may be defined or calculated differently by other companies. In addition, Adjusted EPS has limitations as an analytical tool and should not be considered as a measure of profit or loss per share. 1 Numerator and Denominator of the GAAP measure Basic EPS 2 Numerator and Denominator of the non-GAAP measure Adjusted EPS IN THOUSANDS (EXCEPT PER SHARE AMOUNTS) Q3 2023 Q3 2022 YTD 2023 YTD 2022 Numerator: Net income available to Class A Common Stockholders1 $3,255 $14,714 $3,712 $36,685 Undistributed earnings allocated to Series A Convertible Preferred Stock 261 — 110 — Accretion of Series A Convertible Preferred Stock 1,838 — 1,838 — Net income (loss) attributable to non-controlling interest 13,269 9,599 13,477 (2,049) Consolidated net income 18,623 24,313 19,137 34,636 Change in fair value of warrant liabilities (850) (11,583) 1,419 (37,869) Revaluation gain on previously held equity method investment — (34,735) — (34,735) Adjusted consolidated net income (loss)2 $17,773 $(22,005) $20,556 $(37,968) Denominator: Weighted-average shares of Class A Common Stock Outstanding - basic1 84,479 82,816 84,042 82,569 Total potentially dilutive shares outstanding: Conversion of non-controlling interest Hagerty Group Units to Class A Common Stock 255,499 255,758 255,499 255,758 Conversion of Series A Convertible Preferred Stock to Class A Common Stock 6,785 — 6,785 — Total unissued share-based compensation awards 8,490 6,878 8,490 6,878 Total warrants outstanding 19,484 19,484 19,484 19,484 Potentially dilutive shares outstanding 290,258 282,120 290,258 282,120 Fully dilutive shares outstanding2 374,737 364,936 374,300 364,689 Basic Earnings per Share1 $0.04 $0.18 $0.04 $0.44 Adjusted Earnings (Loss) per Share2 $0.05 $(0.06) $0.05 $(0.10) In the third quarter of 2022, we began removing (i) the change in fair value of our warrants and (ii) the revaluation gain on previously held equity method investment from consolidated Net income (loss) for purposes of calculating Adjusted EPS. For comparability, references to prior period non-GAAP measures have been updated to show the effect of removing the change in the fair value of our warrants from Adjusted EPS. We believe this updated presentation of Adjusted EPS enhances investors' understanding of our financial performance from activities occurring in the ordinary course of our business.. We define Adjusted Earnings (Loss) Per Share ("Adjusted EPS") as consolidated Net income (loss), less the change in fair value of our warrants divided by our outstanding and total potentially dilutive securities, which includes (i) the weighted-average issued and outstanding shares of Class A Common Stock; (ii) all issued and outstanding non-controlling interest Hagerty Group Units; (iii) all unexercised warrants; (iv) all unissued share-based compensation awards; and (v) all issued and outstanding shares of the Series A Convertible Preferred Stock. Basic Earnings Per Share to Adjusted Earnings (Loss) Per Share RECONCILIATION OF NON-GAAP METRICS

HAGERTY Q3 2023 | 16 Adjusted EBITDA By providing this non-GAAP financial measure, together with a reconciliation to net income (loss), which is the most comparable GAAP measure, we believe we are enhancing investors’ understanding of our business and our results of operations, as well as assisting investors in evaluating how well we are executing our strategic initiatives. However, Adjusted EBITDA has limitations as an analytical tool, and should not be considered in isolation, or as an alternative to, or a substitute for net income (loss) or other financial statement data presented in our Condensed Consolidated Financial Statements as indicators of financial performance. Hagerty's Adjusted EBITDA may be determined or calculated differently than similarly titled measures of other companies in our industry, which could reduce the usefulness of this non-GAAP financial measure when comparing our performance to that of other companies. IN THOUSANDS 2023 Low 2023 High Net Income $2,000 $12,000 Interest and Other (Income) Expense (18,500) (18,500) Income Tax (Benefit) Expense 15,500 15,500 Depreciation and Amortization 44,112 44,112 Restructuring, Impairment and Related Charges, Net 8,857 8,857 Change in Fair Value of Warrant Liabilities 1,419 1,419 Share-based Compensation Expense 17,500 17,500 Losses and impairments related to divestitures 4,112 4,112 Adjusted EBITDA $75,000 $85,000 We present Adjusted EBITDA because we consider it to be an important supplemental measure of the Company's performance and believe it is frequently used by securities analysts, investors, and other interested parties in the evaluation of companies in our industry. Management uses Adjusted EBITDA as a measure of the operating performance of our business on a consistent basis, as it removes the impact of items not directly resulting from our core operations. We define Adjusted EBITDA as consolidated Net income (loss) excluding interest and other income (expense), income tax (expense) benefit, and depreciation and amortization, adjusted to exclude (i) changes in fair value of warrant liabilities; (ii) share-based compensation expense; and when applicable, (iii) restructuring, impairment and related charges, net; (iv) the net gain or loss from asset disposals; (v) losses and impairments related to divestitures; (vi) revaluation gain on previously held equity method investment; and (vii) certain other unusual items. Net Income to Adjusted EBITDA RECONCILIATION OF NON-GAAP METRICS | 2023 OUTLOOK

HAGERTY Q3 2023 | 17 RAISED $105M OF CAPITAL IN JUNE OF 2023 TO DRIVE GROWTH AND VALUE CREATION $80M of capital raised at Hagerty, Inc. to support strategic growth initiatives $25M of Tier 2 capital at Hagerty Re provided by State Farm Strong sponsorship from existing strategic investors »$50M from State Farm »$15M from Markel Hagerty family investment of $15M Attractive opportunity to deploy capital to drive profitable growth and returns: »Establish new products to offer differentiated solutions to car enthusiasts »Support growing Marketplace business including Broad Arrow Capital’s lending activity »Working capital as Hagerty continues to pivot to sustainable profitability by creating a scalable platform for growth in Insurance and Membership » » Bolsters cash and liquidity ($264M as of September 30, 2023 with $91M in cash and cash equivalents and $173M available under credit facility) Support growth in our quota share risk taking with Essentia Prepare to take direct risk as we evolve to become a more integrated insurance business Support our efforts to obtain a credit agency rating for Hagerty Re

Cover	Nov. 08, 2023
Entity Information [Line Items]
Document Type	8-K
Document Period End Date	Nov. 08, 2023
Entity Registrant Name	HAGERTY, INC.
Entity Incorporation, State or Country Code	DE
Entity File Number	001-40244
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
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
Entity Central Index Key	0001840776
Amendment Flag	false
Entity Tax Identification Number	86-1213144
Common Class A
Entity Information [Line Items]
Title of 12(b) Security	Class A common stock, par value $0.0001 per share
Trading Symbol	HGTY
Security Exchange Name	NYSE
HGTY:WarrantsEachWholeWarrantExercisePriceof11.50PerShareMember
Entity Information [Line Items]
Title of 12(b) Security	Warrants, each whole warrant exercisable for one shareof Class A common stock, each at an exercise price of$11.50 per share
Trading Symbol	HGTY.WS
Security Exchange Name	NYSE