Hagerty raises $105 million

Hagerty , a classic car insurer, raised $105 million from existing strategic investors including State Farm, Markel Group and the Hagerty family. The news follows the company’s public listing in December 2021 which valued the company at $3 billion.

This capital raise is comprised of $80 million of convertible preferred equity, which closed on June 23, as well as a $25 million commitment of long-term debt financing for Hagerty Reinsurance. The funds will help support the company’s growth initiatives focused on serving the car enthusiast community. This includes evolving the company’s risk appetite and core product to augment its offerings to current members and reach new members who represent 33 million enthusiast vehicles in the US which is expected to drive meaningful written premium and operating profit growth over the coming years. The capital will also allow Hagerty to make ongoing technology investments that should drive operating efficiencies while improving customer facing interactions.

“We are pleased to continue to grow our investment in Hagerty and help support their strategic business objectives as we prepare for the upcoming launch of our commercial relationship.” – State Farm’s Chairman, President and Chief Executive Officer Michael Tipsord.

“Hagerty is an important partner for our insurance business, and we are excited to see them further expand their insurance offerings by finding new and innovative ways to serve automotive enthusiasts.” – Markel Group’s Chief Executive Officer Tom Gayner.

“We have been working diligently over the last six months to deliver improved profitability and margin expansion, while making the investments necessary to sustain our growth trajectory for many years to come. We believe that the additional capital positions us well during uncertain economic times to execute against our significant growth opportunities.” – Hagerty’s Chief Executive Officer McKeel Hagerty.

Bottom Line: All that glitters is not gold.