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Related-Party Transactions (Tables) | 9 Months Ended
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Sep. 30, 2024
Related Party Transactions [Abstract] |
Schedule of Ownership Interests, by Affiliates | As of September 30, 2024, Markel and State Farm had the following equity interests in Hagerty and, as a result, are considered related parties:
|  | Markel |  | State Farm
Equity Interest |  | Shares/Units |  | Percentage of total outstanding (1) |  | Shares/Units |  | Percentage of total outstanding (1)
Hagerty, Inc. Class A Common Stock |  | 3,108,000 |  |  | 3.5 | % |  | 51,800,000 |  |  | 57.6 | %
Hagerty, Inc. Class V Common Stock |  | 75,000,000 |  |  | 29.9 | % |  | — |  |  | — | %
Hagerty, Inc. Series A Convertible Preferred Stock |  | 1,590,668 |  |  | 18.8 | % |  | 5,302,226 |  |  | 62.5 | %
THG units |  | 75,000,000 |  |  | 21.7 | % |  | — |  |  | — | %
Controlling Interest |  | 3,108,000 |  |  | 3.5 | % |  | 51,800,000 |  |  | 57.6 | %
Non-controlling Interest |  | 75,000,000 |  |  | 29.4 | % |  | — |  |  | — |
(1) The percentages reflected represent only the ownership of the specific security identified in each row, and are not reflective of the total economic ownership in Hagerty.
Schedule of Related Party Transactions | The following tables summarize all balances related to the risk ceded by Hagerty Re to State Farm subsidiaries:
|  | September 30, |  | December 31,
|  | 2024 |  | 2023
Assets: |  | in thousands
Commissions receivable |  | $ | 2,338 |  |  | $ | 1,963 |
Deferred acquisition costs, net (1) |  | (4,646) |  |  | (3,898) |
Other current assets |  | 13,169 |  |  | 9,268 |
Total assets |  | $ | 10,861 |  |  | $ | 7,333 |
Liabilities: |  |  |  |
Accounts payable, accrued expenses and other current liabilities |  | $ | 4,497 |  |  | $ | 3,775 |
Total liabilities |  | $ | 4,497 |  |  | $ | 3,775 |
(1) Represents unearned ceding commission received from State Farm subsidiaries.
|  | Three months ended September 30, |  | Nine months ended September 30,
|  | 2024 |  | 2023 |  | 2024 |  | 2023
Revenue: |  | in thousands
Earned premium (1) |  | $ | (4,089) |  |  | $ | (1,645) |  |  | $ | (12,111) |  |  | $ | (3,035) |
Expenses: |  |  |  |  |  |  |  |
Ceding commission, net (2) |  | $ | (2,126) |  |  | $ | (855) |  |  | $ | (6,298) |  |  | $ | (1,578) |
Losses and loss adjustment expenses (3) |  | (906) |  |  | (329) |  |  | (4,510) |  |  | (607) |
Total expenses |  | $ | (3,032) |  |  | $ | (1,184) |  |  | $ | (10,808) |  |  | $ | (2,185) |
(1) Represents premiums ceded to State Farm subsidiaries, which are accounted for as a reduction to "Earned premium". (2) Represents commissions from State Farm subsidiaries related to ceded reinsurance, which are accounted for as a reduction to "Ceding commissions, net". (3) Represents loss recoveries associated with reinsurance ceded to State Farm subsidiaries, which are accounted for as a reduction to "Losses and loss adjustment expenses". The following tables provide information related to Markel-affiliated "Due to insurer" liabilities and "Commission revenue" associated with the Markel Alliance Agreement:
| September 30, |  | December 31,
| 2024 |  | 2023
| in thousands (except percentages)
Due to insurer | $ | 108,039 |  |  | $ | 75,922 |
Percent of total | 91 | % |  | 95 | %
| Three months ended September 30, |  | Nine months ended September 30, |  |
| 2024 |  | 2023 |  | 2024 |  | 2023 |  |
| in thousands (except percentages)
Commission revenue | $ | 105,461 |  |  | $ | 95,559 |  |  | $ | 305,105 |  |  | $ | 267,935 |  |  |
Percent of total | 92 | % |  | 94 | % |  | 93 | % |  | 95 | % |  |
The following tables summarize all balances related to the Company's reinsurance business with Markel subsidiaries:
| September 30, |  | December 31,
| 2024 |  | 2023
Assets: | in thousands
Premiums receivable | $ | 195,802 |  |  | $ | 134,376 |
Commissions receivable | 568 |  |  | 630 |
Deferred acquisition costs, net | 171,776 |  |  | 141,880 |
Other current assets | 2,602 |  |  | 1,915 |
Total assets | $ | 370,748 |  |  | $ | 278,801 |
Liabilities: |  |  |
Accounts payable, accrued expenses and other current liabilities | $ | 899 |  |  | $ | 1,553 |
Losses payable and provision for unpaid losses and loss adjustment expenses | 246,883 |  |  | 189,520 |
Commissions payable | 91,406 |  |  | 107,286 |
Unearned premiums | 373,038 |  |  | 307,504 |
Total liabilities | $ | 712,226 |  |  | $ | 605,863 |
| Three months ended September 30, |  | Nine months ended September 30, |  |
| 2024 |  | 2023 |  | 2024 |  | 2023 |  |
Revenue: | in thousands
Earned premium | $ | 170,921 |  |  | $ | 140,674 |  |  | $ | 489,577 |  |  | $ | 384,646 |  |  |
Expenses: |  |  |  |  |  |  |  |  |
Ceding commission, net | $ | 79,193 |  |  | $ | 64,391 |  |  | $ | 226,589 |  |  | $ | 177,568 |  |  |
Losses and loss adjustment expenses | 98,070 |  |  | 55,909 |  |  | 227,491 |  |  | 153,758 |  |  |
Total expenses | $ | 177,263 |  |  | $ | 120,300 |  |  | $ | 454,080 |  |  | $ | 331,326 |  |  |

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- Definition Tabular disclosure of related party transactions. Examples of related party transactions include, but are not limited to, transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners and (d) affiliates. + References No definition available. + Details
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