Greetings, and welcome to the Hagerty Fourth Quarter 2024 Earnings Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Jay Koval Senior Vice President of Investor Relations. Thank you, sir. You may begin. Thank you Operator and good morning everyone. Thank you for joining us to discuss Hagerty's results for the fourth quarter of 2024. I'm joined this morning by McKeel Hagerty, Chief Executive Officer and Chairman, and Patrick McClymont, Chief Financial Officer. During this morning's conference call, we will refer to an accompanying presentation that is available on Hagerty's Investor Relations section of the company's corporate website at investor.hagerty.com. Our earnings release slides and letter to stockholders covering this period are also posted on the IR website, as well as our 8-K filing. Today's discussion contains forward-looking statements and non-GAAP financial metrics, as described further on slide two of the earnings presentation. Forward-looking statements include statements about our expected future business and financial performance and are not promises or guarantees of future performance. They are subject to a variety of risks and uncertainties that could cause the actual results to differ materially from our expectations. For a discussion of material risks and important factors that could affect our actual results, please refer to those contained in our filings with the SEC, which are also available on our Investor Relations website and at sec.gov. The appendix of the presentation also contains reconciliations of our non-GAAP metrics to the most directly comparable GAAP measures that are further supplemented by this morning's 8-K filing. With that, I'll turn the call over to McKeel. Thanks Jay and good morning everyone. We appreciate you taking the time to join Hagerty's Fourth Quarter 2024 Earnings Call. This quarter marks the eighth straight quarter in a row of executing on our strategy to deliver high rates of top-line growth while more efficiently translating that revenue into profitability and cash flow. Slide three shows how we exceeded our original expectations from a year ago in terms of both revenue and net income. Over the last two years, we added more than 500,000 car lovers to the Hagerty ecosystem and grew revenue by $412 million while increasing operating income by $134 million and tripling operating cash flow to $177 million. While these results are impressive, we have a long straightaway ahead, given only a 5% share today of the 48 million collectible car opportunity in the U.S. Let me share some highlights from the full year shown on slide four. First, our business strategy brand and marketing initiatives drove another year of excellent revenue gains up 20%, as we welcomed a record 279,000 new members this year to Hagerty's ecosystem of products and services. Written premium gains of 15% are in line with our 10-year compound annual growth rate of 15%. This CAGR demonstrates the predictable nature of our recurring revenue model fueled by high single-digit annual additions from net new business count plus industry-leading retention that climbed to 89% in 2024. Operating income jumped sixfold in 2024 to $66 million, despite the $27 million impact from Hurricane Helene and Milton. Cost discipline, resource prioritization and terrific execution by one team Hagerty powered the margin expansion of our MGA and provides the funds to reinvest in extending our leadership position. We have continued to deepen our bench strength through several strategic hires across insurance, claims, technology, and marketplace. These people bring the expertise and leadership that should position Hagerty well for our next wave of growth. Equally important, our technology and digital teams are making strong progress as we transition from our legacy technology platform to a modern cloud-based architecture that will drive future efficiency gains and scalable growth. Let me move on to slide five and walk you through Hagerty's 2025 priorities built around three themes: simpler, faster, and better integrated. First and most impactful to our long-term trajectory is to expand our specialty insurance offerings to protect more collectible vehicles. This includes launching new products and pricing with a slightly wider aperture for our underwriting, particularly in the more modern enthusiast vehicle space. Second is to simplify and better integrate our membership experience across products and services, creating revenue synergies and driving cost efficiencies. We have built one team Hagerty to deliver service levels that surpass the expectations of automotive enthusiasts while simultaneously creating on-ramps for car lovers. We want to be even better as we welcome the next million and a half members by 2030. Third is to expand our marketplace business, leveraging the trust we have built in the United States through the Broad Arrow team's work, helping members to buy and to sell their prized possessions. In May, we will host our inaugural sale at the prestigious Villa d'Este Concours on Lake Como I taly, which should help fuel our private party sales and financing businesses in new markets outside of the United States. We are also developing our online marketplace, given the opportunity to capitalize on the $15.7 billion worth of vehicles that Hagerty members bought and sold in 2024, up 10% from 2023. Fourth, we will continue to leverage Hagerty's unique and authentic car culture as our key differentiator for new and future members, but with further improvements to our operating capabilities through the alignment and engagement of our team. As I mentioned before, we are investing in the once-in-a-generation technology replatforming that will enable scalable growth over the coming years, delivering excellent experiences for our members with greater efficiency. Let me expound on the final priority around technology shown on slide six, as it is a meaningful near-term investment that should position us well to continue our torrid growth while improving our margin structure in 2026 and 2027. Our technology transformation began in 2022 when we brought in new IT leadership that identified several challenges and risks associated with our aging IT infrastructure, which was built in the 2000s and remains the central platform supporting our business. Most problematic was that our legacy IT would be unable to support a rapid growth trajectory. In addition to it limiting our scalability, the current technology stack was also negatively impacting our operational efficiency, creating a suboptimal user experience and inefficient workflow for our member service center team. In late 2023, we began the process to transition to Duck Creek, a leading provider of insurance software solutions, which is a key part of our larger transformational program we call Apex. While these multi-year implementations are complex and expensive, Apex will simplify and improve the member experience with enhanced security and workflow automation, all while lowering marginal operating costs. Additional benefits of Apex and Duck Creek include more self-service and rule-based functionality, more modern risk-rating architecture with greater segmentation, and liberating our technology team to invest in our key differentiators around personalized ratings, valuation, parts finders, repair networks, CRM, and integration with member content, to name a few. These near-term investments should result in greater long-term efficiency for our teams and better experiences for our members, which drives future growth and margin expansion. We are willing to make these short-term trade-offs because we are looking to maximize shareholder value over periods of time measured in years and decades, not quarters. In total, we estimate that we will make over $20 million in elevated investments in 2025 due primarily to having two redundant systems operating with the requisite people and software expenses. This spend will remain heightened in absolute terms, but should trend down as a% of revenue as we accelerate the top line in 2026 and 2027, not to mention realizing greater efficiency from the technology benefits as we double our policies in force to $3 million by 2030 and drive higher margins. Let me now turn the call over to Patrick to share more detail on our 2024 results and initial 2025 outlook. Thank you and good morning everyone. Let me walk you through our results for the fourth quarter ended December 31, shown on slides seven and eight. In the fourth quarter, total revenue grew 19% to $292 million. Written premiums grew 13% due to robust new business count and 89% retention. Commission and fee revenue jumped 15% to $89 million. Membership, marketplace, and other revenue increased 68% to $34 million, boosted by marketplace inventory sales. We also continue to invest in our Broad Arrow team of automotive specialists particularly outside the United States, as we build out our European business in preparation for the May auction at the Villa d'Este Concours. The team is off to a strong start in 2025 producing results that surpassed expectations at the Academy of Art University auction two weeks ago. Earned premium grew 14% to $168 million, and our loss ratio in the quarter came in at 43%, including over a point of impact related to the catastrophe claims from the hurricane season. Now, turning to profitability, shown on slides nine and ten, we reported a fourth quarter operating profit of $3 million. We better leveraged G&A, down 1% in the quarter, and salaries and benefits grew by 6%. Adjusted EBITDA of $20 million increased $10 million year over year due to the improved margins. We delivered fourth quarter net income of $8 million, slightly below the prior year's result. Net income this year was helped by the continued expansion of our capital base and better diversified investments, while the prior year benefited from the change in fair value of our private and public warrants of $13 million. Recall, the warrants were eliminated from our capital structure through an exchange offer last summer. Net income attributable to Class A common shareholders was $1 million after attribution of earnings to the non-controlling interest and accretion on the preferred stock. GAAP basic and diluted earnings per share was $0.01 for the quarter, based on 90 million weighted average shares of Class A common stock outstanding. Adjusted earnings per share, defined as consolidated net income before the gains and losses related to our warrants, divided by 360 million diluted shares, came in at $0.02 for the fourth quarter. Let me also run through a few of the full-year highlights from 2024. Commission and fee revenue jumped 16%. Membership, marketplace, and other revenue grew 30%. Earned premium for a risk-taking entity, Hagerty Reinsurance, increased 21%. Full-year loss ratio of 46% included six points of impact from CAT losses. With seating commission for Hagerty Re at 47% of earned premium, our combined ratio of 94% is slightly above our long-term target of 90% due to the hurricanes. Hagerty Re delivered a healthy 24% return on equity despite the CAT losses. 2024 operating income jumped $56 million to $66 million. Full-year operating margins expanded 450 basis points powered by operating leverage in our MGA business, where we held total expense growth to only 3% in the year, including a 3% decline in G&A and a 2% increase in salaries and benefits. Investment income jumped 57% in 2024 to $36 million, as our capital builds and we have transitioned from short-term cash-like products to a diversified, high-quality portfolio of largely fixed income investments. This translated into full-year net income of $78 million, up 178%, $0.10 of earnings per diluted share, and $0.24 of adjusted EPS. Adjusted EBITDA, which excludes the $36 million of investment income, grew 41% to $124 million as margins expanded to exceed 10%. Full-year operating cash flow jumped 32% to $177 million, allowing us to fund the substantial technology investments that McKeel discussed to support efficient long-term growth. Hagerty's business model is highly differentiated from traditional P&C carriers, resulting in retention of over 92% after adjusting for policies lost when a vehicle is sold. Best-in-class retention, plus sustained additions to new business count, allows us to deliver predictable revenue growth with limited underwriting volatility. AM Best reaffirmed our A-rating, and we successfully renegotiated reinsurance terms for 2025, despite a challenging hurricane season for the industry, with similar coverage on our growing base of business at a lower cost. We ended December with an unrestricted cash balance of $105 million versus long-term debt also at $105 million. Debt, excluding back leverage, for Broad Arrow Capital's portfolio of loans collateralized by collector cars was only $75 million. Let me wrap up with our 2025 outlook shown on slide 11. We anticipate that 2025 will be another year of strong results driven by record new business count and great customer retention. 13%-14% growth in written premiums should translate into total revenue gains of 12%-13%. We are on track to expand the State Farm Classic Plus program to 25 states in 2025, including a tranche of three more states over the coming weeks. More important to the near-term growth trajectory is that we are beginning the renewal conversion process of the initial State Farm launch states over the coming months. These four states have 70,000 vehicles that will become part of the new Classic Plus program by the end of 2025, leading to accelerating growth in written premiums as we move from the first quarter towards the fourth quarter. We expect the large ramp in our volumes will occur in 2026 and 2027 when the majority of State Farm's 520,000 antique vehicles convert over to our program. We could not be prouder of the work our team is doing and what this program will mean to classic car lovers as we set a new standard for how partnerships can operate. Our margin expansion story will continue in 2025, albeit at a measured rate due to the investments we are making to support the Duck Creek implementation. This is the year where we begin paying full license fees for the new platform, our launching Enthusiast Plus, and staffing up for State Farm, all before the revenue fully kicks in. While the elevated investments result in a near-term slowdown in our rate of profit margin expansion, accelerating rates of top-line growth combined with operational efficiencies and the benefits of scale should fuel bottom-line performance in the ensuing years. In 2025, we expect net income gains of 30%-40%, equating to a range of $102 million-$110 million. Adjusted EBITDA should increase 21%-29% to a range of $150 million-$160 million. This outlook also incorporates $11 million of pre-tax losses from the Southern California wildfires, resulting in an expected combined ratio in our risk-taking entity of 90%. In summary, 2025 is on track to be another great year of results at Hagerty, and our technology investments will position us for sustained compounding profit growth over the ensuing years. With that, let us now open the call to your questions. Thank you. We will now be conducting a question-and-answer session. If you would like to ask a question, please press Star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press Star 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the Star keys. One moment, please, while we poll for questions. Thank you. Our first question comes from a line of Matt Carletti with Citizens JMP. Please proceed with your question. Hey, thanks. Good morning. Good morning, Matt. Good morning. First, I was hoping kind of a high-level question you could give a little color. Can you just update me on kind of the trends that you're seeing in the business in terms of I'm thinking about cross-sell or maybe cross-engagement is the right word between insurance, membership, marketplace, kind of as you build those kind of legs of the stool, kind of what you see with kind of your insureds or your members kind of taking advantage or being engrossed in different parts of the business? Yeah, thank you Matt. Thanks for the question. This is McKeel. The main thing for us is that we sell membership as an additional offering to our insurance product. The uptake on that historically has been about 80% of everybody buys the full HDC Hagerty Drivers Club product at $70 each. That tool is the main engagement lever, right? It is a revenue line in and of itself. It is a profitable line of business in and of itself, but it is where the bulk of our engagement happens. Newsletters, magazine, all the different points of contact that we have when somebody is fully a member of the business. It is through those vehicles that we cross-promote our marketplace offerings, both Broad Arrow and the digital marketplace business, which is just sort of beginning the scale-up phase of its life. It has gone really, really well. The main thinking around Hagerty Drivers Club though is to drive engagement. It's to drive retention. It's to drive word of mouth. It's not necessarily meant to be a top-of-funnel kind of product. You can buy. You have been able historically to buy Hagerty Drivers Club just independently of buying insurance, but it's really insurance is the front door, and then we engage them from there. Hopefully, that answers your question. It does. Absolutely. A follow-up, if I could, just maybe timely given what's going on currently, just tariffs. What you might think might be the impact on the business? I'm thinking parts and things like that. At least that's what we think about with auto broadly, whether it be Mexico or China. I'd imagine your supply chains might look a little different than kind of the industry at large? Just curious what impact you might expect, if any. Sure. It's Patrick, Matt. Obviously, our frequency is much, much lower than what you see in daily driver. The types of parts that are used for our vehicles, it's a much more diverse and fragmented supply chain. It's hard for us to quantify what the impact could be, just the nature of our business. Some of those parts are clearly coming from Canada. Some are clearly coming from Mexico. We do expect there'll be an inflationary effect from this over time. Similar to our overall dynamics, we think it'll be less of an impact for us. It'll hit us more gradually. We don't have big players in the supply chain that send us letters saying prices are going up by 25%, right? That's just not the nature of our business. It'll take longer for us for it to unfold. It is just really hard for us to quantify the nature of the supply chain. Okay, great. That's very helpful. Thank you. I appreciate it. As a reminder, if you would like to ask a question, press Star 1 on your telephone keypad. Our next question comes from a line of Maxwell Fritscher with Truist. Please proceed with your question. Hi, good morning. I'm calling in from Marques. Have you seen any slowdown in shopping behavior recently from consumers? If not, do you expect this to continue to be a tailwind for you in 2025, assuming that you're currently a net beneficiary of this? No, thank you. It's a great question. McKeel again here. This time of year is the slower time of the year. It starts ramping up for us. We're a big seasonal business in a lot of ways. There's a big bell curve of new business that comes in starting kind of late March and then rolling through kind of the end of October. Two things that can definitely affect the differences in shopping behavior. We've talked about in the past how shopping behavior has been driven by rising interest rates and also rising values in cars. When people who have held a car for a long time and suddenly realize it's appreciated significantly and they realize it's the time to sell, we benefit from that if we can insure the car after they sell it or if they buy it and add it to a policy. Over the last 12 months, we saw an increase in the volume of our customers and members buying cars and selling them. The transactional volume is good. That's good for us. We get more sort of swings at the ball. Two things that maybe change that slightly are California is a big market in the car world. The California wildfires had a dampening effect on a lot of people. Anytime you get those kind of big shocks, people just sort of sit tight. It does not mean they do not have cars that need to be insured. It does not mean they do not want to buy. That can have a sort of effect, as well as cold weather. Because while the northern parts of the United States, their cars are all asleep, slumbering, waiting for spring to go out and be driven, in the south, when it's still driving season, yet it's colder in the south sometimes, that can actually sort of have some sort of effect. Again, it all tends to ramp up in the next sort of 30 to 60 days. Yeah, that's helpful color. You had just mentioned tariffs shouldn't have too much of an immediate impact on the business. Are the possible effects implemented into current pricing, or will those pricing actions be implemented as you see the effects come through? The nature of the business is all pricing changes require regulatory approval. We've worked through over the last two years most of the states. A lot of that was focused on changes on the liability side. We've been able to get price increases for that. There's nothing that we've contemplated for tariffs specifically. It'll have to play out, right? We'll have to figure out what the impact is, prove that impact, and then we'd have to apply for price increases. As you know in this industry these things are measured in long long cycle times. Perfect. Thank you. Thanks for taking my questions. Thank you. Thank you. Our next question comes from a line of Pablo Singzon with JP Morgan. Please proceed with your question. Hi, good morning. First question is for Patrick. In just thinking about how the expense savings or reduction will phase out over the coming years, right? $20 million drops out in 2026. Outside of normal course efficiency initiatives, are there more substantial expense savings to think about as a result of the tech migration? Yeah. The first thing to say is we're not suggesting that $20 million drops out after 2026. A fair bit of the elevated expenses we have right now are license costs related to the new platform. Those will continue. A chunk of it is also depreciation in the money that we've spent over the last couple of years building out the new platform. That too will continue. Some of it is people costs, right? With State Farm really ramping up the launching of the new Enthusiast Plus product, there are staff costs associated with that growth. The message is not that that drops away. The message is we're making those investments now, and the revenue associated with it starts to ramp up at the second half of this year, but really doesn't come into play until 2026, 2027. This is really investing smartly to create a scalable platform for growth. Once you have that scalable platform, we'll see that those costs relative to the revenue growth, the revenue, they decline as a%. We're creating scalability. It just happens to be that 2025 is a little bit of a pinch point where the expenses are here and the revenue is not quite here yet. Hopefully that clarifies how we're thinking about it. We continue to look at continuous improvement throughout the business. We did a very good job in 2023 and very much held the line in 2024 on the cost structure. Because of these new initiatives we are investing in 2025. We have initiatives throughout the organization to look for ways to create efficiency. A lot of it is around the operating system, creating that scalable system that when we talk about growing from a million and a half customers right now and 2.4 million vehicles, 2.5 million, and doubling that over the next four or five years, that's a huge amount of growth. We have to do a very scalable platform. That is what you should focus on on a go-forward basis, that we are creating operating leverage through this approach. Yep. Thanks for clarifying. Just to follow up on that last comment about doubling the policy counter, that was actually my second question. To the extent you can, can you speak through the drivers of that strong growth, right? If I just look at your policy count, 2024 or 2023, I think it was up 8%. Now, clearly, you're expanding your underwriting aperture. I'm not sure if you're counting State Farm in that policy count growth, but sort of maybe walk through the main drivers that build up to that target in 2030. Thank you. Sure. You obviously know as well because those are the key elements, right? State Farm, absolutely. There are 500,000-plus vehicles that are currently on the State Farm books that transition to our program over the next handful of years. That starts this year. We will start doing conversions in the original four states in the next few months. We are growing in new states with them. We will be in 25 states or more by the end of the year. That is a huge chunk of it. Servicing those customers and delivering the Hagerty value proposition for them is a big opportunity for us. Enthusiast Plus is another big opportunity. We have talked a lot about how we actually have really attractive market penetration in some of the older cohorts. Think about pre-war vehicles, '50s, '60s. There's still room for us to grow there, and we do continue to grow our account in those cohorts. As you get to the more modern vehicles, '80s, '90s, 2000s, 2010s, our penetration is quite small. A big reason for that is we say no a lot of the time. We don't have a product that's appropriately designed for a lot of those vehicles. That's what Enthusiast Plus is. Creating a product that allows us to say yes to the customer, price that appropriately for the risk that we're taking on, that's a big growth opportunity for us, a big lever. We continue to grow on the core book. We continue to see opportunities both on the direct side and with our partners, agents, brokers. As you know, we're in business with nine of the top 10 insurance companies. We do think there's other opportunities for partnerships and deepening the partnerships we have with those existing companies. When you put it all together, that's how we're talking about in the neighborhood of doubling the number of customers we serve over the next five years or so. Yep. Just to clarify Patrick, are you assuming any new partnerships in the trajectory, or is it really just State Farm and other things you mentioned? Thank you. I would say we're not explicitly saying there's a partner or two partners, but implicitly to get to these kind of numbers, yeah, we've been very successful building these relationships. Yes, over that long-range planning horizon, we assume there'll be new partners. Okay. Thank you. Thank you. We have no further questions at this time. Mr. Hagerty, I would like to turn the floor back over to you for closing comments. Thank you, operator, and thank you, everyone. Thank you especially to One Team Hagerty for delivering authentic experiences and service delivery for car lovers seen in our industry-leading Net Promoter Score of 82, more than double the industry average of 39. NPS is a leading indicator for us as it helps to fuel our direct business with high rates of new business growth through word-of-mouth referrals. Our strong brand and reputation for excellent service and automotive expertise enables us to create long-lasting partnerships with national insurance carriers who turn to Hagerty to protect their members and customers' special vehicles and to preserve their bundled insurance business. It took us 40 years to get to 1.5 million members, and we are on track to deliver the next 1.5 million members in just five years, augmented by growth from our partners. Our investment posture positions us to accelerate our top line over the coming years and to keep driving margins higher. In other words, the best is yet to come for profit growth, creating value for Hagerty shareholders. We hope to see you this weekend at the Amelia Concours near Jacksonville, Florida, where we will celebrate the 30th anniversary of the event, including two days of Broad Arrow auctions with 166 Enthusiast vehicles offered for sale, Cars in Community on the main show field, a dinner honoring four-time winner of the Indianapolis 500, Ilio Kastronevis, as well as the renowned 30th Concours d'Elegance on Sunday, March 9th. It should be a fun weekend for all. Until then, never stop driving. Ladies and gentlemen, this does conclude today's teleconference. You may disconnect your lines at this time. Thank you for your participation and have a wonderful day.