Supplemental Balance Sheet and Cash Flow Information

3 Months Ended

Mar. 31, 2026

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Supplemental Balance Sheet and Cash Flow Information

4 — Supplemental Balance Sheet and Cash Flow Information

Cash and Cash Equivalents and Restricted Cash and Cash Equivalents

As of March 31, 2026 and 2025, cash and cash equivalents and restricted cash and cash equivalents were as follows:

	March 31,
	2026		2025
	in thousands
Cash and cash equivalents	$	212,371	$	127,704
Restricted cash and cash equivalents	154,362		158,604
Total cash and cash equivalents and restricted cash and cash equivalents	$	366,733	$	286,308

Restricted Assets

Hagerty Re maintains trust accounts for the benefit of ceding insurers as security for its obligations for losses, loss expenses, and unearned premium. The Company's wholly owned insurance carrier subsidiary, Drivers Edge Insurance Company ("Drivers Edge"), maintains assets on deposit with a number of regulatory authorities to support its insurance operations.

The Company's MGA subsidiaries collect premiums from insureds on behalf of various insurance carriers. Prior to remittance to the insurance carrier, these funds are required to be held in trust for the benefit of the insurance carriers and segregated from the Company's operating cash.

Broad Arrow Capital LLC ("BAC") and its consolidated subsidiaries maintain bank accounts that are required for the operation of the BAC Credit Facility (as defined in Note 14 — Debt). The funds in these bank accounts represent security under the BAC Credit Facility and their use is restricted to the servicing of the debt outstanding under that facility.

The following table presents the components of the Company's restricted assets as of March 31, 2026 and December 31, 2025:

	March 31,		December 31,
	2026		2025
	in thousands
Restricted cash and cash equivalents	$	154,362	$	138,823
Fixed maturity securities	555,902		675,302
Equity securities	—		34,871
Total restricted assets	$	710,264	$	848,996

Variable Interest Entities

BAC and certain of its subsidiaries transfer notes receivable to wholly owned, bankruptcy-remote, special purpose entities (each, an "SPE") to secure borrowings under the BAC Credit Agreement (as defined in Note 14 — Debt).

These SPEs are considered to be variable interest entities (each, a "VIE") under GAAP and their financial statements are consolidated by BAC, which is the primary beneficiary of the SPEs and also a consolidated subsidiary of the Company. BAC is considered to be the primary beneficiary of the SPEs because it has (i) power over the significant activities of the SPEs through its role as servicer of the notes receivable used to secure borrowings under the BAC Credit Agreement; and (ii) the obligation to absorb losses or the right to receive returns that could be significant through its interest in the residual cash flows of the SPEs.

Refer to Note 8 — Notes Receivable and Note 14 — Debt for additional information.

The following table presents the assets and liabilities of the Company's consolidated VIEs as of March 31, 2026 and December 31, 2025:

	March 31,		December 31,
	2026		2025
ASSETS	in thousands
Cash and cash equivalents	$	1,686	$	697
Restricted cash and cash equivalents	5,281		17,005
Notes receivable	142,420		81,740
Other assets	1,578		1,748
TOTAL ASSETS	$	150,965	$	101,190
LIABILITIES
Accounts payable and accrued expenses	$	649	$	524
Debt, net	110,493		68,423
Other liabilities	1,218		1,658
TOTAL LIABILITIES	$	112,360	$	70,605

Supplemental Cash Flow Information

The table below presents information regarding the Company's non-cash investing and financing activities, as well as the cash paid for interest and taxes for the three months ended March 31, 2026 and 2025:

	Three months ended March 31,
	2026		2025
Non-cash investing activities:	in thousands
Issuance of notes receivable (1)	$	7,142	$	9,553
Collection of notes receivable (1)	$	1,734	$	1,884
Capital expenditures	$	1,693	$	908
Non-cash financing activities:
Exchange of THG units for shares of Class A Common Stock (Refer to Note 16)	$	698	$	234
Issuance of shares of Class A Common Stock resulting from the vesting of RSUs (Refer to Note 17)	$	100	$	100
Cash paid for interest	$	2,701	$	1,807
Cash paid for income taxes	$	230	$	101

(1)    In certain situations, BAC makes loans to refinance accounts receivable balances generated by Broad Arrow Group, Inc. ("Broad Arrow") auctions and private sales. These loans are accounted for on the Condensed Consolidated Balance Sheets as non-cash reclassifications between "Accounts receivable" and "Notes receivable" and are not presented within Investing Activities in the Company's Condensed Consolidated Statements of Cash Flows. Upon repayment, the cash received in settlement of such loans is classified within Operating Activities in the Company's Condensed Consolidated Statements of Cash Flows.