Revenue

12 Months Ended

Dec. 31, 2022

Revenue from Contract with Customer [Abstract]

Revenue

2 — Revenue

Disaggregation of Revenue — The following table presents Hagerty's revenue by distribution channel offering, as well as a reconciliation to total revenue for the years ended December 31, 2022 and 2021:

	Agent		Direct		Total
	in thousands
	Year Ended December 31, 2022
Commission and fee revenue	$	133,584	$	113,864	$	247,448
Contingent commission	32,899		26,891		59,790
Membership revenue	—		45,234		45,234
Marketplace and other revenue	—		32,055		32,055
Total revenue from customer contracts	$	166,483	$	218,044	$	384,527
Earned premium recognized under ASC 944					403,061
Total revenue					$	787,588
	Year Ended December 31, 2021
Commission and fee revenue	$	115,310	$	98,926	$	214,236
Contingent commission	29,552		27,783		57,335
Membership revenue	—		40,605		40,605
Marketplace and other revenue	—		11,079		11,079
Total revenue from customer contracts	$	144,862	$	178,393	$	323,255
Earned premium recognized under ASC 944					295,824
Total revenue					$	619,079

The following table presents Hagerty's revenue disaggregated by geographic area, as well as a reconciliation to total revenue for the years ended December 31, 2022 and 2021:

	U.S.		Canada		Europe		Total
	in thousands
	Year Ended December 31, 2022
Commission and fee revenue	$	224,255	$	19,142	$	4,051	$	247,448
Contingent commission	59,664		—		126		59,790
Membership revenue	41,893		3,341		—		45,234
Marketplace and other revenue	29,920		767		1,368		32,055
Total revenue from customer contracts	$	355,732	$	23,250	$	5,545	$	384,527
Earned premium recognized under ASC 944							403,061
Total revenue							$	787,588
	Year Ended December 31, 2021
Commission and fee revenue	$	193,520	$	16,782	$	3,934	$	214,236
Contingent commission	57,424		(383)		294		57,335
Membership revenue	37,688		2,917		—		40,605
Marketplace and other revenue	9,448		301		1,330		11,079
Total revenue from customer contracts	$	298,080	$	19,617	$	5,558	$	323,255
Earned premium recognized under ASC 944							295,824
Total revenue							$	619,079

Earned Premium — The following table presents Hagerty Re's total premiums assumed and the change in unearned premiums for the years ended December 31, 2022 and 2021:

	Year Ended December 31,
	2022		2021
	in thousands
Underwriting income:
Premiums assumed	$	474,293	$	353,925
Reinsurance premiums ceded	(10,749)		(7,920)
Net premiums assumed	463,544		346,005
Change in unearned premiums	(60,263)		(50,491)
Change in deferred reinsurance premiums	(220)		310
Net premiums earned	$	403,061	$	295,824

Contract Assets and Liabilities — The following table is a summary of the Company's contract assets and liabilities for the periods specified below. Contract assets are classified as "Commission receivable", and liabilities are classified as "Contract liabilities" within current and non-current liabilities on the Consolidated Balance Sheets.

	2022		2021
	in thousands
Contract assets	$	60,151	$	57,596
Contract liabilities	$	44,426	$	41,390

Contract assets consist of CUC receivables, which are earned throughout the year and received in the first quarter of the following year. As such, the Commission receivable balance is generally smallest in the first quarter, and grows throughout the year as additional CUC receivables are accrued. For the year ended December 31, 2022, the increase in contract assets was primarily due to $59.8 million of CUC that was recognized but not received, offset by $57.2 million of CUC that had been included in the year ended December 31, 2021 contract assets and subsequently received in the current year.

Contract liabilities consist of cash collected in advance of revenue recognition, which primarily includes HDC membership. In addition, the Company entered into an agreement with State Farm Mutual Automobile Insurance Company ("State Farm") in 2020 and received an advanced commission payment to offset costs of system development (refer to Note 17 — Related-Party Transactions for additional information). For the year ended December 31, 2022, the increase in contract liabilities was due to $60.2 million of advanced consideration received for which revenue was not recognized in the period, primarily related to HDC memberships, partially offset by $57.2 million of revenue recognized during the period that had been included in the year ended December 31, 2021 contract liabilities balance.