Hagerty Q1 written premiums up 18% to $289M, adjusted EBITDA +77%
HGTY•Hagerty reported first quarter 2026 written premiums rose 18% to $289 million and earned premiums jumped 42% to $240 million, driving a 77% rise in adjusted EBITDA to $85 million. However, a $13 million net loss included $89 million of Markel fronting arrangement transition costs, and policies in force grew 15% to 1.8 million.
1. Premium Growth and Membership Expansion
In the first quarter of 2026, Hagerty increased written premiums by 18% to $289 million and earned premiums by 42% to $240 million. Policies in force rose 15% year-over-year to 1.8 million, marking a record addition of 112,000 new policies, while Drivers Club membership exceeded 940,000 paid members.
2. Transition to 100% Markel Fronting Arrangement
Effective January 1, 2026, Hagerty assumed full control of the Markel program under a fronting arrangement, eliminating commission revenue and consolidating 100% of premiums. This strategic shift drove a 5% decline in reported total revenue to $312 million but positioned Hagerty for higher underwriting retention.
3. Profitability and Transitional Costs
Adjusted EBITDA rose 77% to $85 million, reflecting operational leverage and cost discipline, while underwriting performance improved with a combined ratio of 86.5%. The company recorded a $13 million net loss due to $89 million of pre-tax transition costs related to the Markel arrangement, compared to net income of $27 million in Q1 2025.
4. Outlook and Auction Milestone
Hagerty reaffirmed its full-year 2026 written premium growth outlook of 15% to 16% and anticipates a net loss of $41 million to $51 million including further transition costs. During Q1, Broad Arrow delivered a record $111 million auction at Amelia Car Week with a 92% sell-through rate and over 1,000 bidders from 23 countries.
