Hagerty, Inc. (HGTY) Stock Analysis and Metrics

Sector: Financial Services Industry: Insurance - Property & Casualty CIK: 0001840776

Market Cap 1.05 Bn

P/E 38.41

P/S 0.83

Div. Yield 0.00

ROIC (Qtr) 0.00

Total Debt (Qtr) 228.61 Mn

Revenue Growth (1y) (Qtr) 84.13

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About

Hagerty, Inc. is a market leader in providing insurance for collector cars and enthusiast vehicles, helping the automotive enthusiast community protect and enjoy their special cars for more than 40 years. The company operates as a Managing General Agent (MGA) by underwriting, selling, and servicing collector car and enthusiast vehicle insurance policies on behalf of insurance carrier partners. Its offerings are complemented by the Hagerty Drivers Club membership, renowned car events, media and entertainment platforms, and a trusted marketplace where...

Hagerty, Inc. is a market leader in providing insurance for collector cars and enthusiast vehicles, helping the automotive enthusiast community protect and enjoy their special cars for more than 40 years. The company operates as a Managing General Agent (MGA) by underwriting, selling, and servicing collector car and enthusiast vehicle insurance policies on behalf of insurance carrier partners. Its offerings are complemented by the Hagerty Drivers Club membership, renowned car events, media and entertainment platforms, and a trusted marketplace where collectors and enthusiasts can buy and sell a wide range of vehicles.

Hagerty, Inc. generates revenue through multiple streams. The primary source is insurance-related activities, including commission and fee revenue from underwriting, selling, and servicing insurance policies on behalf of carrier partners. Additionally, the company earns reinsurance premiums through Hagerty Re, its Bermuda-based reinsurance subsidiary. Revenue is also derived from the Marketplace segment via auction commission revenue, private sales commissions, bidder fees, and financing solutions provided by Broad Arrow Capital LLC. Investment income from fixed maturity securities, equity securities, and cash holdings further contributes to earnings.

The company operates through the following segments: Insurance and Marketplace.

• The Insurance segment focuses on underwriting, selling, and servicing collector car and enthusiast vehicle insurance policies. It operates as an MGA for carrier partners such as Essentia Insurance Company, Aviva Canada, and State Farm. The segment includes Hagerty Re, which reinsures risks from policies issued by Essentia and other partners. It also encompasses the Hagerty Drivers Club membership, automotive events, media and entertainment platforms, and related ancillary activities that support brand awareness and customer engagement.

• The Marketplace segment provides a trusted platform for collectors and enthusiasts to buy and sell vehicles. It includes live auctions and an online sale platform through Hagerty Marketplace, as well as brokered private sales. At the high-end, transactions are conducted by its wholly owned subsidiary Broad Arrow, which also engages in opportunistic acquisitions of collector cars. The segment offers financing solutions via Broad Arrow Capital LLC, which structures loans secured by collector cars and enthusiast vehicles for qualified customers in the U. S., Canada, the U. K., and certain European countries.

Hagerty, Inc. holds a leading position in the U. S. collector car and enthusiast vehicle insurance market with an overall market share of approximately 7% across 36 million insurable vehicles. It has an estimated 15% market share for pre-1981 classic vehicles and 3% for post-1980 collectible vehicles. The company differentiates itself through its enthusiast-centered ecosystem, strong brand loyalty reflected in a Net Promoter Score of approximately 81, and a high insurance policy retention rate nearing 90% with an average policy life of nine years. Competitors include other specialty insurance providers, though Hagerty’s integrated model of insurance, membership, events, media, and marketplace creates a unique value proposition that reduces reliance on price-based competition.

Hagerty, Inc. serves automotive enthusiasts and collectors who own or are interested in collector cars and enthusiast vehicles. Its customer base includes individuals seeking insurance for special vehicles, members of the Hagerty Drivers Club, participants in automotive events, users of its media and entertainment platforms, and buyers and sellers utilizing its marketplace for vehicle transactions. The company also works with insurance carrier partners, independent agents and brokers, and financial institutions through its lending subsidiary.

Investment thesis

Bull case

Hagerty has demonstrated a compelling acceleration in new business, evidenced by a 13% rise in written premium and a 14% increase in commission revenue during the first nine months of 2025. The firm attributes this growth to the rapid expansion of its partnership portfolio, notably the State Farm integration and the newly announced Liberty Mutual and Safeco collaboration. These alliances provide a funnel for high‑volume, high‑quality classic‑car policyholders, positioning Hagerty to capture a broader share of the niche market. By leveraging its strong brand equity and superior customer experience, Hagerty is poised to convert this influx into sustained underwriting growth. The company’s guidance of 14% to 15% revenue growth for the full year reflects confidence that the partnership pipeline will materialize at or above expectations.
The classic‑car market is undergoing a structural shift toward younger, tech‑savvy collectors who favor online transactions, as highlighted by a 12% surge in online sales this year. Hagerty’s platform, which hosts both live auctions and private sales, is uniquely positioned to capitalize on this trend, having already seen a 54% jump in marketplace and other revenue. The launch of the Enthusiast Plus product targets the post‑1980 cohort, a segment currently under‑penetrated at just 3% coverage, offering a clear path to higher premiums and broader market reach. This diversification not only taps a growing customer base but also aligns with the evolving consumer behavior toward digital purchasing channels. The company’s focus on high‑performance supercars and newer models, combined with its data‑driven underwriting capabilities, further strengthens its competitive moat.
Hagerty Reinsurance’s recent AM Best rating upgrade to “A‑” underscores the resilience of the company’s underlying insurance operations. The rating committee cited strong capital position, consistently low combined ratios relative to peers, and robust underwriting profitability driven by specialized valuation and claims expertise. These factors suggest that the reinsurance arm can absorb larger volumes of policy dollars while maintaining a favorable loss ratio, thereby enhancing the overall underwriting portfolio’s stability. Additionally, the reinsurance entity’s diversified investment strategy, moving from a cash‑heavy stance to a more balanced bond allocation, provides a modest but solid income stream that supports the group’s profitability. With this solid footing, Hagerty can further expand its direct insurance offerings without compromising financial health.
Hagerty’s strategic emphasis on technology replatforming and the shift to 100% fronting through the Markel arrangement is poised to unlock significant cost efficiencies and margin expansion. By assuming full underwriting risk and premium capture, the company removes the need to share a portion of the income with reinsurers, directly improving profitability. The fronting change also streamlines operational processes, allowing for more consistent pricing and underwriting decision‑making that align with Hagerty’s internal expertise. The transition is projected to result in a lower operating expense base relative to the premium written, as evidenced by the 350 basis point margin improvement in the first nine months of 2025. This operational leverage is a key driver behind the firm’s upward guidance for both revenue and earnings.
The expansion of Hagerty Marketplace into Europe, coupled with the launch of Broad Arrow Live Auctions, provides a new revenue corridor that is less dependent on domestic insurance cycles. The firm’s existing valuation and sales platform can be leveraged across borders, creating synergies between auction pricing, transaction fees, and ancillary services such as storage and maintenance. With the European auction volume projected to reach $240 million by November, the marketplace can serve as a diversified growth engine, especially as the European collector market matures and online transactions increase. This international footprint also reduces reliance on the U.S. regulatory environment and mitigates geographic concentration risk. As the company integrates these operations, it can generate incremental profitability from a higher percentage of transaction volumes.

Hagerty has demonstrated a compelling acceleration in new business, evidenced by a 13% rise in written premium and a 14% increase in commission revenue during the first nine months of 2025. The firm attributes this growth to the rapid expansion of its partnership portfolio, notably the State Farm integration and the newly announced Liberty Mutual and Safeco collaboration. These alliances provide a funnel for high‑volume, high‑quality classic‑car policyholders, positioning Hagerty to capture a broader share of the niche market. By leveraging its strong brand equity and superior customer experience, Hagerty is poised to convert this influx into sustained underwriting growth. The company’s guidance of 14% to 15% revenue growth for the full year reflects confidence that the partnership pipeline will materialize at or above expectations.
The classic‑car market is undergoing a structural shift toward younger, tech‑savvy collectors who favor online transactions, as highlighted by a 12% surge in online sales this year. Hagerty’s platform, which hosts both live auctions and private sales, is uniquely positioned to capitalize on this trend, having already seen a 54% jump in marketplace and other revenue. The launch of the Enthusiast Plus product targets the post‑1980 cohort, a segment currently under‑penetrated at just 3% coverage, offering a clear path to higher premiums and broader market reach. This diversification not only taps a growing customer base but also aligns with the evolving consumer behavior toward digital purchasing channels. The company’s focus on high‑performance supercars and newer models, combined with its data‑driven underwriting capabilities, further strengthens its competitive moat.
Hagerty Reinsurance’s recent AM Best rating upgrade to “A‑” underscores the resilience of the company’s underlying insurance operations. The rating committee cited strong capital position, consistently low combined ratios relative to peers, and robust underwriting profitability driven by specialized valuation and claims expertise. These factors suggest that the reinsurance arm can absorb larger volumes of policy dollars while maintaining a favorable loss ratio, thereby enhancing the overall underwriting portfolio’s stability. Additionally, the reinsurance entity’s diversified investment strategy, moving from a cash‑heavy stance to a more balanced bond allocation, provides a modest but solid income stream that supports the group’s profitability. With this solid footing, Hagerty can further expand its direct insurance offerings without compromising financial health.
Hagerty’s strategic emphasis on technology replatforming and the shift to 100% fronting through the Markel arrangement is poised to unlock significant cost efficiencies and margin expansion. By assuming full underwriting risk and premium capture, the company removes the need to share a portion of the income with reinsurers, directly improving profitability. The fronting change also streamlines operational processes, allowing for more consistent pricing and underwriting decision‑making that align with Hagerty’s internal expertise. The transition is projected to result in a lower operating expense base relative to the premium written, as evidenced by the 350 basis point margin improvement in the first nine months of 2025. This operational leverage is a key driver behind the firm’s upward guidance for both revenue and earnings.
The expansion of Hagerty Marketplace into Europe, coupled with the launch of Broad Arrow Live Auctions, provides a new revenue corridor that is less dependent on domestic insurance cycles. The firm’s existing valuation and sales platform can be leveraged across borders, creating synergies between auction pricing, transaction fees, and ancillary services such as storage and maintenance. With the European auction volume projected to reach $240 million by November, the marketplace can serve as a diversified growth engine, especially as the European collector market matures and online transactions increase. This international footprint also reduces reliance on the U.S. regulatory environment and mitigates geographic concentration risk. As the company integrates these operations, it can generate incremental profitability from a higher percentage of transaction volumes.

Bear case

Management’s responses during the Q&A reveal a lack of transparency around the economics of the Liberty Mutual and Safeco partnership, with no concrete figures provided for the expected PIF or premium tailwind. The reliance on a “book roll” model introduces uncertainty regarding the timing and scale of the partnership’s impact on revenue. Furthermore, the firm has not clarified whether any pricing adjustments or risk sharing mechanisms will be in place, leaving open the possibility that the partnership may not deliver the projected volume gains. This ambiguity presents a hidden risk that could limit the anticipated upside from these alliances and strain the company’s growth narrative.
The newly introduced Enthusiast Plus product targets a higher‑risk cohort of modern enthusiast vehicles, a segment for which the company has limited historical loss experience. During the call, executives admitted the program is still in early stages and that loss ratio outcomes are “too early to speak.” This lack of data heightens the risk of adverse loss experience that could materially impact the combined ratio, especially if younger, high‑performance cars exhibit higher claim frequencies or severity. Should the product’s loss profile deteriorate, Hagerty’s already modest profit margin would be under pressure, undermining the firm’s broader margin expansion strategy.
Seasonal volatility and catastrophic exposure remain significant risks, particularly in hurricane‑prone markets such as Tampa and Miami, where the company’s Safe Storage Concierge program is active. While the firm touts a low loss ratio relative to peer averages, the quarter’s 42% loss ratio indicates that claims costs can still be substantial in peak seasons. The company has acknowledged that Q4 is typically a lighter period for claim activity, but this seasonality also means that any unexpected weather event could disproportionately inflate losses during an otherwise quiet quarter. Such volatility could erode earnings and impair capital adequacy in the short term.
Operating expenses, especially G&A and salary and benefit costs, have accelerated, with a 17% rise in G&A and a 44% increase in salaries and benefits. Although management projects that these expenses will settle in the mid‑to‑high single‑digit range, the current trajectory suggests a higher than anticipated cost burden. If the company cannot control these outlays, it could offset the margin gains achieved through operational efficiencies. This risk is amplified by the capital requirements associated with the Markel fronting arrangement, which may necessitate additional reserves and potentially increase the company’s cost of capital.
Hagerty’s marketplace business, while experiencing rapid revenue growth, remains a low‑scale, high‑transaction cost operation that has yet to produce significant bottom‑line contribution. Management indicates that the business is still in the “single‑digit millions” profitability range, suggesting that further scaling may be required before it can materially support earnings. The episodic nature of private sales and the heavy reliance on brokerage commissions expose the firm to revenue volatility and may limit the ability to forecast consistent profitability from this segment. As the marketplace matures, the company will need to manage margins carefully to avoid diluting overall earnings.

Management’s responses during the Q&A reveal a lack of transparency around the economics of the Liberty Mutual and Safeco partnership, with no concrete figures provided for the expected PIF or premium tailwind. The reliance on a “book roll” model introduces uncertainty regarding the timing and scale of the partnership’s impact on revenue. Furthermore, the firm has not clarified whether any pricing adjustments or risk sharing mechanisms will be in place, leaving open the possibility that the partnership may not deliver the projected volume gains. This ambiguity presents a hidden risk that could limit the anticipated upside from these alliances and strain the company’s growth narrative.
The newly introduced Enthusiast Plus product targets a higher‑risk cohort of modern enthusiast vehicles, a segment for which the company has limited historical loss experience. During the call, executives admitted the program is still in early stages and that loss ratio outcomes are “too early to speak.” This lack of data heightens the risk of adverse loss experience that could materially impact the combined ratio, especially if younger, high‑performance cars exhibit higher claim frequencies or severity. Should the product’s loss profile deteriorate, Hagerty’s already modest profit margin would be under pressure, undermining the firm’s broader margin expansion strategy.
Seasonal volatility and catastrophic exposure remain significant risks, particularly in hurricane‑prone markets such as Tampa and Miami, where the company’s Safe Storage Concierge program is active. While the firm touts a low loss ratio relative to peer averages, the quarter’s 42% loss ratio indicates that claims costs can still be substantial in peak seasons. The company has acknowledged that Q4 is typically a lighter period for claim activity, but this seasonality also means that any unexpected weather event could disproportionately inflate losses during an otherwise quiet quarter. Such volatility could erode earnings and impair capital adequacy in the short term.
Operating expenses, especially G&A and salary and benefit costs, have accelerated, with a 17% rise in G&A and a 44% increase in salaries and benefits. Although management projects that these expenses will settle in the mid‑to‑high single‑digit range, the current trajectory suggests a higher than anticipated cost burden. If the company cannot control these outlays, it could offset the margin gains achieved through operational efficiencies. This risk is amplified by the capital requirements associated with the Markel fronting arrangement, which may necessitate additional reserves and potentially increase the company’s cost of capital.
Hagerty’s marketplace business, while experiencing rapid revenue growth, remains a low‑scale, high‑transaction cost operation that has yet to produce significant bottom‑line contribution. Management indicates that the business is still in the “single‑digit millions” profitability range, suggesting that further scaling may be required before it can materially support earnings. The episodic nature of private sales and the heavy reliance on brokerage commissions expose the firm to revenue volatility and may limit the ability to forecast consistent profitability from this segment. As the marketplace matures, the company will need to manage margins carefully to avoid diluting overall earnings.

Segments Breakdown of Revenue (2025)

Geographical Breakdown of Revenue (2025)

Peer comparison

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1	CB	Chubb Ltd	124.94 Bn	11.20	1.96	1.93 Bn
2	PGR	Progressive Corp/Oh/	115.42 Bn	9.99	1.34	-
3	TRV	Travelers Companies, Inc.	64.23 Bn	8.77	1.25	-
4	ALL	Allstate Corp	56.05 Bn	4.71	0.82	-
5	HIG	Hartford Insurance Group, Inc.	37.07 Bn	9.31	1.67	-
6	WRB	Berkley W R Corp	25.87 Bn	13.91	1.68	1.63 Bn
7	CINF	Cincinnati Financial Corp	25.67 Bn	9.35	2.25	0.86 Bn
8	MKL	Markel Group Inc.	23.35 Bn	13.29	1.96	-

Research Tools

Hagerty, Inc. (NYSE: HGTY)

About

Investment thesis

Bull case

Bear case

Segments Breakdown of Revenue (2025)

Geographical Breakdown of Revenue (2025)

Peer comparison

Research Tools

Hagerty, Inc. (NYSE: HGTY)

About

Investment thesis

Bull case

Bear case

Segments Breakdown of Revenue (2025)

Geographical Breakdown of Revenue (2025)

Peer comparison

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