Hippo reports Q1 results
Hippo has released its Q1 2025, ending the period with a net loss of $48 million, an increase of $12 million compared to Q1 2024. The LA wildfires contributed $45 million to the net loss. Without the impact of the LA wildfires, Hippo’s net loss would have improved by $33 million YoY.
The Services segment, which includes the consumer insurance agency, had revenue of $11.7 million, an increase of 3%, and an adjusted operating loss of $3.5 million, a decrease of 34% compared to Q1 2024.
The Insurance-as-a-Service segment, which is comprised of the Spinnaker fronting business, reported revenue of $38.9 million, an increase of 91%. The growth was driven primarily by a combination of increased premium retention on certain programs and the increase in performance of existing programs. Adjusted operating loss was $0.5 million, compared to income of $4.7 million in the prior year quarter, due primarily to an increase in loss and loss adjustment expenses due to losses from the LA wildfires of $12.1 million and increased premium retention.
The Hippo Homeowners Insurance Program had revenue of $61.9 million, an increase of 12%, due primarily to higher net earned premium as a result of higher premium retention on Hippo’s 2024 and 2025 reinsurance treaties. Adjusted operating loss was $38 million, an increase of 88%, due primarily to an increase in losses related to the LA wildfires of $32 million and seasonality of the book of business.
Hippo’s home insurance program had a gross loss ratio of 121%, compared to 80% in Q1 2024. The LA wildfires contributed 56 percentage points.
The company announced that it signed an agreement to raise a $50 million surplus note. It plans to use the incremental, risk-based capital to support the growth of diversified product lines it accesses via the Spinnaker platform. “We believe so strongly in the value of this platform that we decided to raise additional risk-based capital to further support its growth,” the CEO of Hippo said.
The company’s cash and investments, excluding restricted cash, decreased $42 million QoQ to $528 million.
