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Revenue | 9 Months Ended
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Sep. 30, 2024
Revenue from Contract with Customer [Abstract] |
Revenue | 2 — Revenue Disaggregation of Revenue —The tables below present Hagerty's revenue by distribution channel, as well as a reconciliation to total revenue for the three and nine months ended September 30, 2024 and 2023. Commission and fee revenue and contingent underwriting commission ("CUC") revenue earned from the agent distribution channel includes revenue generated through Hagerty's relationships with independent agents and brokers. Commission and fee revenue and CUC revenue earned from the direct distribution channel includes revenue generated by Hagerty's employee agents. Prior to 2024, the Company's MGA subsidiaries have earned a base commission of approximately 32% of written premium, as well as an additional contingent commission of up to 10% annually. In December 2023, the Company's alliance agreement and associated agency agreement with Markel Group, Inc. ("Markel") was amended to increase the base commission rate on the personal lines United States ("U.S.") auto business to 37% and to adjust the contingent commission to range from -5% to a maximum of +5% of annual written premium. This amendment resulted in a smaller proportion of total revenue being attributable to contingent commissions during the three and nine months ended September 30, 2024, when compared to the three and nine months ended September 30, 2023.
| Three months ended September 30, 2024
| Agent |  | Direct |  | Total
in thousands
Commission and fee revenue | $ | 57,857 |  |  | $ | 47,606 |  |  | $ | 105,463 |
Contingent commission revenue | 5,997 |  |  | 4,701 |  |  | 10,698 |
Membership revenue | — |  |  | 14,800 |  |  | 14,800 |
Marketplace and other revenue | — |  |  | 26,727 |  |  | 26,727 |
Total revenue from customer contracts | 63,854 |  |  | 93,834 |  |  | 157,688 |
Earned premium |  |  |  |  | 165,686 |
Total revenue |  |  |  |  | $ | 323,374 |
| Three months ended September 30, 2023
| Agent |  | Direct |  | Total
| in thousands
Commission and fee revenue | $ | 44,387 |  |  | $ | 37,388 |  |  | $ | 81,775 |
Contingent commission revenue | 11,825 |  |  | 9,573 |  |  | 21,398 |
Membership revenue | — |  |  | 13,835 |  |  | 13,835 |
Marketplace and other revenue | — |  |  | 18,781 |  |  | 18,781 |
Total revenue from customer contracts | 56,212 |  |  | 79,577 |  |  | 135,789 |
Earned premium |  |  |  |  | 139,785 |
Total revenue |  |  |  |  | $ | 275,574 |
| Nine months ended September 30, 2024
| Agent |  | Direct |  | Total
in thousands
Commission and fee revenue | $ | 164,737 |  |  | $ | 136,597 |  |  | $ | 301,334 |
Contingent commission revenue | 17,869 |  |  | 14,614 |  |  | 32,483 |
Membership revenue | — |  |  | 42,385 |  |  | 42,385 |
Marketplace and other revenue | — |  |  | 57,188 |  |  | 57,188 |
Total revenue from customer contracts | 182,606 |  |  | 250,784 |  |  | 433,390 |
Earned premium |  |  |  |  | 474,917 |
Total revenue |  |  |  |  | $ | 908,307 |
| Nine months ended September 30, 2023
| Agent |  | Direct |  | Total
| in thousands
Commission and fee revenue | $ | 123,046 |  |  | $ | 104,229 |  |  | $ | 227,275 |
Contingent commission revenue | 33,506 |  |  | 27,191 |  |  | 60,697 |
Membership revenue | — |  |  | 39,528 |  |  | 39,528 |
Marketplace and other revenue | — |  |  | 43,172 |  |  | 43,172 |
Total revenue from customer contracts | 156,552 |  |  | 214,120 |  |  | 370,672 |
Earned premium |  |  |  |  | 384,498 |
Total revenue |  |  |  |  | $ | 755,170 |
The following tables present Hagerty's revenue disaggregated by geographic area, as well as a reconciliation to total revenue for the three months ended September 30, 2024 and 2023:
| Three months ended September 30, 2024
| U.S. |  | Canada |  | Europe |  | Total
| in thousands
Commission and fee revenue | $ | 96,688 |  |  | $ | 6,952 |  |  | $ | 1,823 |  |  | $ | 105,463 |
Contingent commission revenue | 10,544 |  |  | — |  |  | 154 |  |  | 10,698 |
Membership revenue | 13,844 |  |  | 955 |  |  | 1 |  |  | 14,800 |
Marketplace and other revenue | 25,229 |  |  | 205 |  |  | 1,293 |  |  | 26,727 |
Total revenue from customer contracts | 146,305 |  |  | 8,112 |  |  | 3,271 |  |  | 157,688 |
Earned premium |  |  |  |  |  |  | 165,686 |
Total revenue |  |  |  |  |  |  | $ | 323,374 |
| Three months ended September 30, 2023
| U.S. |  | Canada |  | Europe |  | Total
| in thousands
Commission and fee revenue | $ | 73,891 |  |  | $ | 6,422 |  |  | $ | 1,462 |  |  | $ | 81,775 |
Contingent commission revenue | 21,360 |  |  | — |  |  | 38 |  |  | 21,398 |
Membership revenue | 12,942 |  |  | 893 |  |  | — |  |  | 13,835 |
Marketplace and other revenue | 17,779 |  |  | 229 |  |  | 773 |  |  | 18,781 |
Total revenue from customer contracts | 125,972 |  |  | 7,544 |  |  | 2,273 |  |  | 135,789 |
Earned premium |  |  |  |  |  |  | 139,785 |
Total revenue |  |  |  |  |  |  | $ | 275,574 |
The following tables present Hagerty's revenue disaggregated by geographic area, as well as a reconciliation to total revenue for the nine months ended September 30, 2024 and 2023:
| Nine months ended September 30, 2024
| U.S. |  | Canada |  | Europe |  | Total
in thousands
Commission and fee revenue | $ | 277,613 |  |  | $ | 18,878 |  |  | $ | 4,843 |  |  | $ | 301,334 |
Contingent commission revenue | 32,235 |  |  | — |  |  | 248 |  |  | 32,483 |
Membership revenue | 39,592 |  |  | 2,792 |  |  | 1 |  |  | 42,385 |
Marketplace and other revenue | 52,911 |  |  | 1,230 |  |  | 3,047 |  |  | 57,188 |
Total revenue from customer contracts | 402,351 |  |  | 22,900 |  |  | 8,139 |  |  | 433,390 |
Earned premium |  |  |  |  |  |  | 474,917 |
Total revenue |  |  |  |  |  |  | $ | 908,307 |
| Nine months ended September 30, 2023
| U.S. |  | Canada |  | Europe |  | Total
| in thousands
Commission and fee revenue | $ | 206,099 |  |  | $ | 17,379 |  |  | $ | 3,797 |  |  | $ | 227,275 |
Contingent commission revenue | 60,590 |  |  | — |  |  | 107 |  |  | 60,697 |
Membership revenue | 36,865 |  |  | 2,663 |  |  | — |  |  | 39,528 |
Marketplace and other revenue | 40,366 |  |  | 741 |  |  | 2,065 |  |  | 43,172 |
Total revenue from customer contracts | 343,920 |  |  | 20,783 |  |  | 5,969 |  |  | 370,672 |
Earned premium |  |  |  |  |  |  | 384,498 |
Total revenue |  |  |  |  |  |  | $ | 755,170 |
Refer to Note 12 — Reinsurance for information regarding "Earned premium" recognized under ASC Topic 944, Financial Services - Insurance ("ASC 944"). Contract Assets and Liabilities — The following table is a summary of the Company's contract assets and liabilities as of September 30, 2024 and December 31, 2023:
| September 30, |  | December 31,
| 2024 |  | 2023
| in thousands
Contract assets | $ | 13,581 |  |  | $ | 75,891 |
Contract liabilities | $ | 54,724 |  |  | $ | 47,651 |
Contract assets, which are reported within "Commissions receivable" on the Condensed Consolidated Balance Sheets, consist of CUC receivables, which are earned throughout the year and have historically been settled by a cash payment from the insurance carrier in the first quarter of the following year. As a result of its amended alliance agreement and associated agency agreement with Markel, beginning in 2024, 80% of the CUC receivables from Markel are now being settled monthly rather than on an annual basis. This amendment resulted in a significant decrease in the contract assets balance compared to the prior year. Contract liabilities consist of cash collected in advance of revenue recognition and primarily includes the unrecognized portion of HDC membership fees, the unrecognized portion of the advanced commission payment received from State Farm Mutual Automobile Insurance Company ("State Farm"), and, to a much lesser extent, cash collected in advance of the completion of Marketplace private sales. Refer to Note 21 — Related-Party Transactions for additional information regarding the Company's master alliance agreement with State Farm.

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- Definition The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 9 -Publisher FASB -URI https://asc.fasb.org/1943274/2147479806/606-10-50-9 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 10 -Publisher FASB -URI https://asc.fasb.org/1943274/2147479806/606-10-50-10 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 15 -Publisher FASB -URI https://asc.fasb.org/1943274/2147479806/606-10-50-15 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479806/606-10-50-12 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479806/606-10-50-12 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12 -Subparagraph (c) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479806/606-10-50-12 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12 -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479806/606-10-50-12 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12 -Subparagraph (e) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479806/606-10-50-12 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 13 -Subparagraph (b)(2) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479806/606-10-50-13 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Name Accounting Standards Codification -Topic 606 -Publisher FASB -URI https://asc.fasb.org/606/tableOfContent + Details
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