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Reinsurance | 12 Months Ended
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Dec. 31, 2025
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Abstract] |
Reinsurance | 16 — Reinsurance Hagerty Re assumes risk through quota share reinsurance agreements with various insurance carriers, including a subsidiary of Markel, a related party. Separately, the Company purchases excess-of-loss ("XOL") reinsurance to manage risk exposure and safeguard capital. In addition, the Company enters into quota share reinsurance agreements under which it cedes a portion of its underwriting risk to highly rated reinsurers, thereby limiting the financial impact of potential losses. These reinsurance arrangements do not relieve the Company of its primary obligations to policyholders under the terms of its insurance contracts. The Company partners with reinsurers that are rated A- (Excellent) or better by A.M. Best or that fully collateralize their maximum obligations under the applicable agreements. In an XOL agreement, the Company retains losses for any occurrence up to a specified amount (its "retention"), with reinsurers covering any losses exceeding that threshold up to a defined limit. In a quota share agreement, the Company transfers, or cedes, a percentage of its premiums to reinsurers and, in return, the assuming reinsurer must share an equal percentage of losses and pay a ceding commission to the Company consistent with the terms of the agreement. Ceding commissions are recognized ratably over the terms of the related policies, which are generally 12 months, and are recorded within "Ceding commissions, net" in the Consolidated Statements of Operations. Deferred portions of ceding commissions received are included in "Deferred acquisition costs, net" on the Consolidated Balance Sheets. Hagerty Re renegotiated its catastrophe reinsurance coverage effective January 1, 2026, with terms similar to 2025. The 2026 catastrophe reinsurance program affords coverage for policies with total insured values ("TIV") of up to $5.0 million in excess of a per event retention of $35.0 million in two layers; $35.0 million excess of $35.0 million, and $63.0 million excess of $70.0 million. In addition to the Company's XOL reinsurance, Hagerty Re cedes 100% of its physical damage exposure on U.S. policies written or renewed with TIV equal to or greater than $5.0 million ("High-Net-Worth Accounts") via quota share agreements with various reinsurers. Hagerty Re receives ceding commissions related to premiums ceded under reinsurance contracts related to these High-Net-Worth Accounts. These High-Net-Worth Accounts are assumed 100% from a wholly owned subsidiary of Markel. Certain reinsurers involved in these quota share agreements are related parties. Hagerty Re also purchases facultative reinsurance to cede a portion of the physical damage exposure related to certain high value vehicles. Refer to Note 24 — Related-Party Transactions for additional information on reinsurance transactions with Markel and State Farm. The following table presents the Company's total premiums assumed and ceded on a written and earned basis for the years ended December 31, 2025, 2024, and 2023:
|  |  | Year ended December 31,
|  |  |  |  | 2025 |  | 2024 |  | 2023
Premiums written: |  |  |  |  | in thousands
Assumed |  |  |  |  | $ | 830,645 |  |  | $ | 726,971 |  |  | $ | 636,366 |
Ceded |  |  |  |  | (53,308) |  |  | (50,541) |  |  | (33,070) |
Net |  |  |  |  | $ | 777,337 |  |  | $ | 676,430 |  |  | $ | 603,296 |
Premiums earned: |  |  |  |  |  |  |  |  |
Assumed |  |  |  |  | $ | 776,625 |  |  | $ | 685,763 |  |  | $ | 554,553 |
Ceded |  |  |  |  | (49,899) |  |  | (42,439) |  |  | (22,687) |
Net |  |  |  |  | $ | 726,726 |  |  | $ | 643,324 |  |  | $ | 531,866 |
The following table presents total loss and loss adjustment expenses assumed and ceded for the years ended December 31, 2025, 2024, and 2023:
|  |  | Year ended December 31,
|  |  |  |  | 2025 |  | 2024 |  | 2023
Losses and loss adjustment expenses: |  |  |  |  | in thousands
Assumed |  |  |  |  | $ | 307,907 |  |  | $ | 313,377 |  |  | $ | 222,895 |
Ceded |  |  |  |  | (22,513) |  |  | (14,784) |  |  | (2,237) |
Net |  |  |  |  | $ | 285,394 |  |  | $ | 298,593 |  |  | $ | 220,658 |
Reinsurance Recoverables The following table presents the reinsurance recoverable on paid and unpaid losses and loss adjustment expenses as of December 31, 2025 and 2024:
| December 31,
| 2025 |  | 2024
| in thousands
Reinsurance recoverable on paid losses and loss adjustment expenses | $ | 9,652 |  |  | $ | 6,158 |
Reinsurance recoverable on unpaid losses and loss adjustment expenses | 5,644 |  |  | 5,769 |
Total reinsurance recoverable | $ | 15,296 |  |  | $ | 11,927 |

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