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extra special guest. McKeel Haggerty is chairman and CEO of Haggerty Specialty Insurance. fascinating company they took a little niche wooden boat insurer and turned it into a publicly traded company by embracing the community around collector cars trucks boats etc i thought this conversation was really quite fascinating not just as a car guy but as a business guy and i think you will also with no further ado my conversation with haggarty's mckeel haggarty McKeel Haggerty, welcome to Bloomberg. Thanks for having me. So, let's start with your background. You get a B.A. in English and Philosophy from Pepperdine, and then you get a Master's in Theology at St. Vladimir's Orthodox Theological Seminary. What was the plan, to become a priest?

Yeah, I kind of think about my academic career in a couple of phases. I was an entrepreneur from the time I was young. I had a bunch of businesses when I was very young and thought I would go study business in college. And I ended up falling in love with philosophy and literature and all these things, was philosophy and English major. I was a good student. And I thought I'd get my Ph.D., but I needed a little break to work on languages and some things. And I learned about St. Vladimir's, which is just north of New York here. It's up in kind of near Rye or Scarsdale. And it was this incredible experience because I got to work on my languages. I learned a lot about leadership, actually, at the seminary because there's some pretty extraordinary individuals there. And then there is no doubt about it. You are there to study to become a priest. And while that was not my driving reason to go there, it's a little bit like Michael Corleone. They kind of drag you in. And before you know it, you're suddenly thinking about becoming a priest. I didn't become a priest because then I moved on and started my doctoral work in philosophy up in Boston and did not complete that because the family business called. And I had worked in it during the summers up until then with mom and dad and my two sisters. And all of a sudden, I found myself no longer thinking about exams and a dissertation and all those things and thinking about this really cool business.

So let's talk about this business. The hagiography is your parents, Frank and Louise. They started Hagerty Insurance Agency in Traverse City, Michigan, for what I never would have guessed was an actual business, collector wooden boats. That's right. Like, are there enough collector wooden boats to sustain a full business?

There are enough wooden boats to ensure, to sustain a very small family business, you know, with a few employees. It was kind of a retirement gig for my mom and dad. They had had a general insurance agency, and they sold that, and they wanted something else to do, and they thought... But there were a couple... of principles that were in the back of their mind, which was they wanted a national business instead of a local one. They wanted one that was in a niche rather than like sort of general purpose. And they wanted one that could have like real sustainability over a long period of time. So wooden boats was an unoccupied business space. So literally unmet need, they found, they matched the unmet need with an interest in that underlying interest in wooden boats and in cars my my dad was a wooden boat vintage boat guy and also a car guy and so you know this was just the fun combining the business knowledge with a passion and again my sisters and i kind of helped out when it was much smaller and we kind of stumbled into the car insurance business which was much much larger than um the wooden boat business even the collector car businesses

orders of magnitude orders of magnitude larger millions of vehicles but let's not jump quite Far that ahead, you and your dad used to work on cars, rebuilding projects. You mentioned you had a couple of side hustles, lawn mowing, things like that.

Yeah, my apple orchard.

You spent $500 buying a 1967 Porsche 911 S when you were 13? Yes. Like, I wouldn't be allowed to buy a car at 13. I was lucky I had a bike. And then you and your father rebuilt this.

That's right. I will also note it was the only really good car deal I've ever done in my life, just for what it's worth.

I'm going to assume that was the spark that started your enthusiasm for cars.

Yeah, it was. And my dad was a do-it-yourselfer hobbyist restorer guy in the garage, and both my sisters also restored cars. They were older than I was with him, and then I was the third along, and we convinced this older gentleman in our town to sell us this 911S for $500. And I had to mow an awful lot more lawns and to sell a lot more apples out of my orchard to buy the parts to restore the car. But by the time I could drive, it was ready. Good planning. It was great planning. And I can tell you, there was nobody in my high school driving a Porsche. So I would sneak it into the teacher's parking lot because no one would believe that a student had a Porsche. That's right. That's hilarious. But it's also like back then in the 80s, cars like that were not expensive. They were not considered to be necessarily that valuable. They were just kind of cool older cars, and so we kind of approached it as a family like, hey, you can get a lot of car for not a lot of money, and you can have something really fun to enjoy, and so that was just my life growing up.

I love that the 300 SL from the 50s were being sold at a depreciated price in the 60s and 70s. Oh, of course. It's astonishing.

Well, the most valuable car today, people will tell you, is a Ferrari GTO, 1962. They're worth tens and tens of millions of dollars. But in the 1970s, you could buy them for $15,000. They were nothing. And now they're $50 million, $60 million.

Unbelievable. That 911 S you restored, still have it? I still have it. Still drive it?

Of course. It's my first car out every season, and the last one I put away.

Wow, that's amazing. We could spend a lot of time talking about what else you drive and like. We'll get to that later. I'm curious, when did you first realize Hagerty could become something a whole lot larger than a niche wooden boat insurer?

We had already started the car business in the early 1990s. I've had a couple of aha moments. And this one, I remember it like we were sitting here today. And it was the fall of 1995. I was doing my doctoral work in Boston. And we were reading Plato's Republic in Greek. okay so i'm up in boston college we're working on plato's republican greek that's a big slog yeah i can tell you and i was trying to help out the family business kind of from a distance and the challenge with insurance it's insurance is an incredible industry it's in it's stable it's there's a lot more interesting stuff to it than people think but it is just not very sexy to talk about nobody loves talking about insurance and even with these big brands and stuff today They still don't want to talk about it very much. And so I was literally sitting in this Plato's Republic class, and on the side of my notebook, I wrote this thing. Like, if we would just stop acting like an insurance business and start acting more like a club for car owners, it would just transform the conversation that you're having with people. Because then you're acting more like a car person instead of an insurance person trying to sell a car person something. And I literally wrote this idea of, like, turn Hagerty into a car club. I wrote in my notebook and I closed my notebook I went home that night to my apartment and I dropped out of my PhD program and I went home the next

week. Well let me validate that, not that you need, as a public company, need my validation. Full disclosure I have a few of my cars insured with Hagerty. i'm a member of the club i get the the driver's club magazine but i'm uh it's obvious in hindsight oh of course you're going to focus on this niche that is kind of ignored yes by the major insurance companies how challenging was it to convince the rest of the fam hey this is the way to go we're not an insurance company selling to car collectors we're car people satisfying a few

of the box checking a few of their boxes it took me a few years yeah you know we're a very close family it was really fun to work together with everybody in those early days my my dad retired after kind of that late 90s my mom retired shortly thereafter i was working with my sisters so they kind of gave me the enough rope to go test it out that if we just changed the dialogue and acted just we're going to build an automotive branded business that happens to sell insurance and we're going to do it around this membership concept. It wasn't like no one had ever done something like that. If you think in the early days, AAA was kind of like that. The Motor Club, they're very different than that now. If you were to even think of something like AARP, which is a different sort of segment, like there is a, you know, they sell a lot of insurance and they treat this group of people. USAA, serving military family, people and families. It just, nobody had ever done it in a business like ours. And so it took a little while to convince them that that was the way to go to market and we could change the way we were thinking. But you mentioned something that was another piece in this, which was the next aha. And the next aha was that most of these cars were insured by the big insurance companies. So think State Farm, Allstate, you know, today, Progressive, Geico, everybody. And, you know, we're a little company and we're a tiny family business. It's like, how the heck are you going to compete against these monsters? And so after we got the club kind of up and running, I realized, well, what if we just partnered with these companies rather than competing against them and said, look, we're going to do one thing and one thing only. We're going to be expert in these cars. We know the customers really well. We're building a really big, rich bunch of data. And what if we partnered with them? And so the first big partnership like this, we landed, oh, 22, 23 years ago, and that was with Allstate. And Allstate's, again, a huge company. I knew they insured hundreds of thousands of these cars.

Spin out from Sears so long ago.

Exactly. Lots of interesting things in that company. And I convinced, I met the CEO at the time, and just through kind of people helped connect us. And I said, look, I think I can make you better at this one tiny little thing if you just give us a chance. And they're still a partner today, that program grows every year. And now we've just moved through the entire insurance industry. We've partnered virtually with all of the big insurance companies. And so today, if you go insure your home and your auto and everything with one of them, but you have a vintage car, collector car, whatever you want to call it, that usually comes to us. And so the big scalability of the business was, one, show up like a club, like this member organization. Two, partner rather than to compete. And if you can part, you know, because if you're if you're small, it's impossible to compete against a huge company. But if you partner with them, it changes the game.

Well, when you say it's impossible to compete, one of the fascinating things about insuring an old Vette or an old Porsche is, you know, any of the big firms are going to charge you fifteen hundred, twenty five hundred a year. you guys for alright so I have a 67 Vette which is actually my least favorite car to drive I want to say the 327 but with a stick Nassau blue over white spectacular but it's a pig to drive but it doesn't matter because I think progressive it was like 2200 you guys were 500 and change because of the data You guys know how often these are driven, know the value, know they're really not going to get stolen. That's right. As much as gone in 60 seconds made it look sexy, everybody knows these cars, their VINs, where they are, especially something rare and valuable, which the Vette is not. It's really fascinating that nobody else saw this until you guys did. how did the pricing model come along well it's you know you know and you talked about you drive

your car but you probably don't drive it very much you probably have daily drivers that you know you drive more and you you know are less concerned about where you park it and that sort of thing and you know my late mother passed away uh just two years ago i remember asking her even i'd ask her every year her memory wasn't so great towards the end of her life like mom what made this business special and she would just say because people take good care of their toys Yes.

Of course. And that is the core emotional nugget of this business. You know, people have a toy, they spent real money on it, and they take good care of it. And wherever there is care, there is better insurance risk. So you can charge less. You charge less, you know, you can build marketing around that. You can get a little bit of momentum going.

But not just a little less. It's not like we're beating them by 10%. It's a fraction of what you pay for regular insurance.

Well, right. And look, you're the typical 67 Corvette owner, probably drives that car 1,000, maybe 1,500 miles a year. Some years less. Some years less.

And if they have half the guys in my car group, and they're almost all guys, but not exclusively, some of these guys have 10, 20, 30 cars.

Exactly.

So if they're driving a car, it's something different. Maybe they're putting 500 miles a year on each car at most.

So, like, one of the things you asked about pricing, so not only is the pricing on the physical car less expensive with us, on the liability, too, and it's exactly to that point. You can only drive one car at a time. Liability follows the person, not the car. And so we had an ad very early on in the program. There was a now late collector out in the Pacific Northwest with over 2,000 cars. and we put a name, his face, on one of our ads and he said, here's Harold LeMay, our worst nightmare because he has 2,000 cars, but we charge him only one time for liability.

So how do you, is that a fleet insurance? How do you do something? Kind of like that, yeah. Like if someone has more, and I think the line I heard about tattoos applies to cars, two tattoos is either too few or too many. And if you have half a dozen or a dozen cars, it's probably too many to manage yourself but too few to hire a full-time jay leno-like guy to

run it that's right um most people are space limited right if they have enough money to be into it they end up buying everything that they can afford and still store right so the store is

the storage i'm waiting for permission to build a garage you go a detached garage as opposed to my built-in garage, and if that gets approved by the town, that's going to be both dangerous and expensive.

Well, I'm going to love it, though, because then I'll have more to insure for you.

That's six more cars stored for you guys. Really, really interesting. Coming up, we continue our conversation with McKeel Haggerty, CEO of the Specialty Insurance firm talking about how he built the company into a one and a half billion dollar revenue driver. I'm Barry Ritholtz. You're listening to Masters in Business on Bloomberg Radio. This message is brought to you by Apple Card. Sometimes life's journeys take you on the roads less traveled. That's why Apple created the titanium Apple Card to use anywhere in the world where mastercard is accepted plus with apple card you can earn unlimited daily cash back on every purchase every day whether you're in paris or pulau and no matter where you are with apple card you won't pay annual fees or foreign transaction fees no fees period that's the power of apple card apply in the wallet app on iphone and use it right away with apple pay Subject to credit approval, variable APRs for Apple Card range from 17.49% to 27.74% based on credit worthiness. Rates as of January 1st, 2026. Existing customers can view their variable APR in the Wallet app or at card.apple.com. Apple Card, issued by Goldman Sachs Bank USA, Salt Lake City Branch. Terms and more at applecard.com.

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disclosures. I'm Barry Ritholtz. You're listening to Masters in Business on Bloomberg Radio. My extra special guest this week is McKeel Haggerty. He is the chairman and CEO of Haggerty Collector Car Insurance. The firm insures every collectible vehicle and a handful of boats for more than almost 3 million collectors. So 2025 revenues of $1.5 billion, $1.3 billion in written premium, a record 371,000 new members, net income plus 91%. This is a real publicly traded company,

HGTY. Yes. Wow. I used to have hair when we started all of that, but things are going well.

So I guess if you're not pulling your hair out of your head, you're not public. Let's talk about how you've driven this, one of the interesting insights that seems to have shaped your strategy was that collector cars aren't just financial assets, they're emotional assets. You described them as favorite toys. How did that shape how the firm developed? Well, we started in the

simplest possible way, which we were an insurance agency. You might have mentioned that even early in the first intro, and that's true. That's the easiest way to kind of get into one of these things. You know, as I mentioned, we started with kind of a specialty product, which was insuring special cars. The insurance policy forms were unique. Our pricing, we had a unique approach. We had this driver's club model that started really helping that compounding aspect of it. But one of the big pieces that I guess I dreamed of is that if we actually started taking real risk and became the insurance company itself, not just an agency selling policies for somebody else. It would be the same customer coming in, but we'd have so much more of a chance to really build the revenue behind it. So the other big piece after, if my first aha was driver's club, second aha was really realizing we needed a partner rather than to compete with the big insurance companies, it was how do we start taking risk? So that's been a multi-year, really decade-long journey. that we started in 2017, got that up and running. And it was really a big key piece of how we went public in 2021. And that is that we were going to, you know, we had, everybody knew we had a unique angle on this market that our economics looked great in the business, but that we could realize even that much more. And so that's really been the next big piece of all of this. And it all kind of compounds on itself because if you insure a car, you um we use the club to kind of engage people you know you mentioned reading the haggarty drivers club magazine i mean that is that is by the way i don't think the word insurance is mentioned in that magazine no not at all it's a car magazine and it's cars and roads really yes and it is the now highest circulation car magazine in the world no kidding it is yeah i did not know

that that's really that's really interesting so the evolution from uh insurance to an automotive lifestyle brand goes beyond the club membership goes beyond the magazine events auctions valuation data um walk us through how that all evolved yeah i think um and i was i was a big fan of car

magazines as a big fan of automotive media i mean that's how i i read my way into understanding the car world and going to events so um and i always remember somebody told me once that if you're going to, if you're going to go into a niche business that you're really proud of, you kind of need to have, you need to have the high ground on your side. And for me, the high ground was if I could have a media property that where we would, you know, kind of have that intellectual high ground, that would help. The other piece is the data aspect of it. When I was, you know, growing the business and team, you know, we have incredible teams. We're out there trying to figure it out. Valuing these cars was so tricky because there was a lot of opinions about what cars were worth. But not a lot of really good data. And so, you know, as we were investing in the media pieces, talking about cars and entertaining people, we built the data resources. We call it our automotive intelligence group. We have by far the richest sets of data about how to value these things. And it's down to that VIN or serial number. You know, you mentioned.

mentioned, how does a big insurance company, you know, why didn't they do it? And I remember this conversation years ago in one of those partner discussions where the CEO is a car guy, really wanted to kind of compete with us, wasn't sure if he wanted to partner with us. And I said, well, do you know what a 1969 Camaro is? And he said, I sure do. You know, he's kind of pretty happy with himself. And I said, you may not know that in 1969, the Camaro came in 147 different variants. And that year, the least expensive one was worth about $11,000. And the most valuable one was worth about $1.1 million. And you can't tell the difference by looking at them from the outside. You have to understand what that serial number is. And I said, we built a patented serial number decoder for all cars pre-1981 so that we could understand our universe and start providing that data. And that's why our partners like us. But it's a real asset to have that kind of data and then build on it every year. You mentioned 371,000 new customers. We'll do quite a bit more than that in 2026. Those are all just, it's not just insurance or revenue. It's also data coming our way. What are people buying? What are they insuring them for? What do they sell? When somebody sells a car, it's also a data point. And so for us, that kind of data piece, and again, it's all a big, not just because I'm a car person, I view it as a flywheel. It's a flywheel, and it all kind of spins, and insurance is a beautiful thing, but the

rest of it speeds up the flywheel. Yeah, to say the very least. So the valuation tools you have are really interesting. The bull market list you have has become very influential. I actually reference some of your valuation tools in a chapter on my book on selection bias. Every time some car goes for a new record high, there's always a bunch of media coverage and they talk about look at what a great investment this is and it's like no that's all survivorship buy show me the other 10 don't show me what was the best car of the past 50 years right what car are you going to buy now to put away for the next 50 years that's a much harder question you don't know the answer but your your valuation tools have been really helpful that sort of stuff um how did you build that capability is it simply just hey every data point we come across from clients we're going to suck into a database and figure out?

That was exactly it. I mean, if most media outlets that weren't part of our world, if they were covering the space, they were using a lot of anecdotal information, kind of dealer-fed information, or just looking at public auctions. And I love public auctions, too. Like, you can learn a lot from watching what all the different auction companies do. And now with so many good online places, it's like even more data. But what we realized with our scale is like we just had way more data points than all of that. Because, again, people buying cars and sharing them with us, adding, deleting. It was just this big flow. And, yeah, it took a lot of people a lot smarter than I am to build all the, you know, not just the database stuff, but the analytics capability around it. And now with AI, it's even better. And then as we started realizing we could get other data sources that help us validate even more, not just in the U.S., but outside of the U.S., it's really been a fun part of the business. I'll tell you what, it's a smart team, and I love learning from them. They teach me stuff every day that I need to know.

So you mentioned auctions and online auctions, in addition to Bring a Trailer and Cars and Bids and PCAR. You guys are now going to get into online auctions for your clients' cars, or are you just partnering with someone?

Oh, no, no. We have our own Hagerty Marketplace platform, which is online auctions.

Now, you've had online classifieds for a long time. How rapidly is the auction side growing?

It's growing rapidly. I mean, we have such a supply that we have way more supply than you think. And if you think about some of those other great companies, like Bring a Trailer has been such a darling in this space, Cars and Bids, the number two in the U.S. But there's a supply and demand balance that everybody has to strike. Because if you flood a digital marketplace with too much supply, then the bidders go away. And if the bidders go away, then nobody's happy. The bidders won't put their cars on it, so it's a fast build, but it's steady. The live auction side of the business, Broad Arrow, which was an acquisition we did after going public, that's a remarkable business because I had followed that industry for a long time around the world, but it's all about getting the right team. In my mind, because I'm very protective of our brand and our reputation, we had to have the kind of team that wasn't prepared to build the number one live auction business, but They have to do it in a way that I'm proud of. And I'm not saying that it's all good or bad, but I want it to be... I wanted to be very proud of the outcome because things will go wrong. You have to make things right for customers. Sometimes cars that people bring to you to sell aren't described exactly as they actually are. And you have to find that out and politely tell them, well, I'm not sure this is a million-dollar car. It's a $100,000 car. And, you know, sorry, if you want us to sell for $100,000, we will, but we're not selling it for a million because it's our reputation, too. And so, again, the way I think about it now is most people come to us to insure a car. Then they buy the membership thing, and we engage them and do media and a lot of fun stuff, invite them to our events. And about every seven years, on average, somebody buys or sells a car. And that's where I want to be there and present in their minds so that we help them in that transactional side. And plus, you've probably been to auctions or watched them on television. They're fun. Like, car auctions are super fun. You know, it's live, it's vibrant, it's interesting. Sometimes there's multi-million dollar cars up there selling it that you can't even believe anybody would pay multi-million dollars for this car. And we do that, too. I mean, that's why we have Broad Aero. We connect it with some of our Concours events in many cases. They're around the world. We just had our Broad Aero auction at the Concorso at Villa d'Este, the Villa d'Este Concorso de la Ganza. and that was a really successful sale and super cool place to have an auction right on Lake Como.

Yeah, in Italy. It looked beautiful. You've been a judge at Pebble Beach for a while.

25 years. I think this is my 25th year.

Wow, and I know there was an affiliation with one of the local concourses here. Maybe it's Greenwich?

Greenwich, yeah. That is an event we own, so we produced that just recently.

Yeah, it's too close to a holiday weekend. Otherwise, I would be there. Oh, you've got to come. I'm usually out at the beach on Memorial Day weekend. But we'll circle back to that. I'm also a big fan of your YouTube channel. I really like Jason Camisa's work. I've learned a lot about cars that I think I know. And then he does a deep dive into a particular model. And I'm like, I didn't know that about the Toyota Supra. Who would have guessed? How did YouTube become such a major part of your brand?

Well, it's one of the, well, it's really the de facto platform for people watching kind of introductory level automotive content. And obviously, lots of brands are putting stuff out there. But what we realized is if you think about the big sort of arc of how people have learned about or consumed automotive media, where it's shifted since the 90s was magazines were the main platform for a long time. Then when you got the first dedicated cable network, which was AutoWeek, SpeedVision, you got some of those. You started seeing auctions on there. But then a lot of that content started migrating to YouTube. But what I wanted to do was do it as the same high quality like we were doing in the magazine. So hire total pros, shoot the stuff really well, great cameras, great locations, all of that stuff.

It is obvious high production value. Like, there are a lot of YouTube channels that are kind of interesting, cars or otherwise. But the appeal has always been two iPhones and a wireless mic and you can cobble something. go pro yes right yeah um i've seen a bunch of channels that they're they're using these not necessarily the gopros right right um uh you guys really put a lot of thought and a lot of time

effort and money into it well we do and they're not all just drag races um nothing wrong with drag races i like them too it kind of is a it's a kind of data point about what makes a car cool but i think jason just takes it to a whole new level for example we also have uh you know one of our one of our shows and by the way we also have you know we have a fast channel on samsung tv on on amazon prime you know our content is available out there like a digital you know television show um our barn find hunter show for years you've probably seen it which is you know this incredible talent in tom cotter going around and finding great cars in barns and kind of doing the big reveal like an antiques roadshow kind of concept but in the garage rather than brought to some studio somewhere. And people like it. There's like some interesting fascination with the U.S. television audience of finding the treasure in the garage and don't you wish it was you who found it. And I find them fascinating. We even, you may have seen one of the shows we produced for a long time. They're kind of winding down, but it was called Red Line Rebuild. And it was where we would do these time-lapse rebuilding of an engine where you take a big dirty engine apart and it would all kind of like appear to assemble itself on an engine stand and then it would start. And just, it was mesmerizing. That's the word I was saying.

I was about to say, there's another channel that does the same thing with old watches and rebuilds them. And it's the same sort of why is this so fascinating as Redline. It's the exact same thing. Coming up, we continue our conversation with McKeel Haggerty, CEO and chairman of Haggerty Specialty Insurance, discussing the collector car community today. I'm Barry Reynolds. You're listening to Masters of Business on Bloomberg Radio.

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I'm Barry Ritholtz. You're listening to Masters in Business on Bloomberg Radio. My extra special guest today is Mikheil Haggerty. He is the CEO and chairman of the namesake specialty insurance company specializing in collectible cars, automotive, everything from cars, trucks, military vehicles, including classic wooden boats, Are those all Chris Craft, or are there some other brands that make their way through that?

Well, Chris Craft and Century were the two big manufacturers in the United States. There were sort of some more boutique brands like Garwood and Hacker Craft, which were really high-end.

Hacker Craft, I've... Yeah, Hacker Craft. Those tend to be a little bigger, right?

A little bit bigger, triple cockpit kind of style boats. For those who are really into the artisanal cheese of the boat world, I love the Canadian brands. such as well there was a whole group of really fine boat builders up there manette shield barnes gravette brands that most americans would not know of but if you ever get a chance to go up to like the muskoka lakes which is just north of toronto it's they're just exquisite like beautifully built boats very they're like considered national treasures up there so so you don't see many of them in the US.

But that was part of my upbringing. Like when my mom and dad were building the boat business and I was a teenager, it was like, oh, we're going to a boat show, going to Canada, going to Lake Tahoe, going to the Finger Lakes of New York.

That's so interesting. I took some friends to a boat show last year and the new Chris Crafts are shockingly beautiful. Like they have aged into modernity really well. Like it's almost like a retro mod. Yes. Because it's very contemporary and very modern, but clearly the design language from way back when.

Yeah, I think it's a little bit like that Hinkley crowd where they're trying to find a retro, modern boat, but with kind of retro looks. I love it.

So let's keep this on cars away from boats. And there's a quote of yours that I have to start with because I really like it. the best piece of advice is to buy the car you want to drive and then buy the best example you can afford this may sound obvious but not all vintage cars drive the way people hope they would so there's nothing in that i disagree with discuss yeah it's i think there's so many people that they

they envision someday when they have that little bit of extra resources you know that's going to be my toy i want to get into the car world and if they weren't a hundred percent in this their whole life or they you know their parents weren't into it or you didn't have an uncle or somebody in your life who let you drive in these things i often recommend people try to get a chance to drive what you think you you want because the older cars do drive very differently yes and even if you think of say muscle cars from the 60s they were very fast i mean these are cars that are in In a straight line. In a straight line, a lot of power. They do not stop or turn as well as you think. And you just have to get used to that. I mean, I love cars of all generations. I love driving very early cars. I have some newer cars. And I always just have to kind of center myself when I get behind the wheel to remember, like, okay, this is not my Porsche Taycan, which is, you know, like this incredible piece of technology, you know, electric car. It's a vintage internal combustion car with funky brakes, and you have to be ready for it. So I always recommend people drive them and recognize that maybe it had air conditioning, maybe the air conditioning doesn't work. It doesn't matter. Like, roll down the window and just enjoy yourself.

Manually. Manually roll down the window. I tell the story, the Vette, the 67, it's a lap brake, a lap belt, not a three-point belt. they couldn't be bothered to put a passenger side mirror on no because you know what are you what are you going to see and the steering is just beastly but i also like the concept of buy the best example you can afford and i find myself constantly saying to people a cheap-ass did martin is the most expensive car you could possibly buy um but people don't really really

get that yeah and they're you know look different different eras of cars come with their own challenges sometimes you know i think as as we're seeing this onslaught of new generations coming in and wanting to buy slightly newer cars i mean it's 60 whatever percent of all of our you know new quotes and new cars coming into the space are all like relatively newer cars car you know 1980s 90s 2000s cars um some of those cars for example it may not be a mechanical issue that can drive you a little crazy. It's an electrical issue that'll drive you a little crazy. If you think of, you know, some of the screens and the CD players and all the little control things that back in 1990, whatever was, you know, the biggest whiz bang feature. Well, it doesn't work so well anymore. The car runs fine, but you know, you're not going to be able to use the antiquated nav system. I just tell people like, you know, relax, it's fine. And, you know, enjoy the car, drive it. And, you know, all my kids, I was asked, like, well, does the radio work in this thing? I'm like, I have no idea. It's never been on. I'm there to drive. And it's such a fun activity, as you know. They just enjoy driving a car for pleasure. And I also tell one, you know, the first thing I tell people who's sort of new to the space, like, well, I want to take it out to dinner. And I'm like, make sure you take it out during the day first a few times, because sometimes cars leave you in the restaurant parking lot at night. So people always ask, why don't you drive them? And I'm like, because I'm not sure I'm going to get home.

If you're used to modern cars, you will be shocked at how terrible the headlights are on, forget 60s, 80s era's car. Those were not really great headlights. They weren't great.

They're not dangerous or anything. You just have to be aware that they don't have all the modern technology.

Well, when all the headlines...

were that way you just said this is what the lighting is and you had to be aware of it that's right it's when you go backwards you take a lot of things for forget the blind side warnings and the backup cameras just your expectation of field of vision yes um is so different so so let's it's

a it's a different kind of attention driving a vintage car it's much more focused it's more focused and i i love it and i you know i encourage people you know just try it out it's a it's a

great experience so so what are some of the bigger trends you're seeing in collecting what what's

changing these days well again big big story you know contrary to you know data that we were reading a few years ago is the next generations are absolutely into cars they like them they're just into different kind of cars than our parents were we were probably well doesn't every generation

sort of lust after the cars from the high school parking lot i think that's right they did and

they're different. And one of my little cottage industry things that I do is, if I'm ever driving anywhere near a high school parking lot, I look to see where the young car people park their cars. And they usually park them in the back of the parking lot, not up near the school, and they all park next to each other, so they go hang out afterwards. And what you're going to see right now, but with the 17 and 18-year-olds car people in these high schools, is you're going to see BMWs, you're going to see Audis, you're going to see some various performance Japanese cars. You're not going to see anything fancy. They can't afford them. But that's the cars they're starting with. Trucks are, of course, another big entry point, and it's been another huge trend. So not just pickup trucks, but kind of vintage SUVs. So Jeeps are still, right now, one of the hottest brands. It's huge. Of course, Broncos are one of the hottest things. Of course, if they can afford them, depending on it, a Land Rover or international scouts. These are the cars that people are interested in because so many cars today are SUVs anyway. And so the vintage version of them are one of these kind of more off-road vehicles. And there's a big industry of modifying them, making them work a little bit better. And so that's another big trend. So again, next generation trucks, I guess I would say, I mean, flying over the top of the whole industry, which, you know, at the top, top end of the market. And just to add on to the answer to your question is, you know, the ultra luxury kind of supercar manufacturers are making more cars than ever, ever before. And so you think of those brands like Ferrari or Lamborghini or Bentley or, you know, even Porsche, my beloved 911 S. Those companies are just building a lot more cars and pumping them out into the market at price points that were different than they used to. So, you know, when Ferrari or Lamborghini were building hundreds of cars a year well now ferrari's a 14 000 unit a year manufacturer lamborghini when you add their suv in it's an eight or nine thousand vehicle manufacturer i mean when i was a kid you never saw a lamborghini unless you just happened to be in beverly hills or palm beach or something and now they're everywhere i mean even in my little town in northern michigan there are a couple lamborghinis driving around i'm like oh my goodness you know That's amazing.

What's crazy is where I live, I'm 15 minutes from a Ferrari dealer, two Porsche dealers, the Bentley, Lambo dealer. And I take it for granted. I see these cars all the time. But as a kid, you hardly ever saw these around. You wouldn't have. Like a Porsche was an exciting thing.

It was. So they are building my next generation of customers. Every one of these manufacturers are like my best friends because they're building the cars that I will be insuring this year and 25 years from now.

So your boy Jason Kamisa mentioned he's only a manual driver. I embrace that. Makes the car even that much more difficult to steal. But I'm curious, amongst the trends in collecting, I've been hearing about a move towards analog, towards manual, away from the big dominant screens. What does your data say?

Well, it's true. And in fact, you think about some of those very same supercar manufacturers that they signaled years ago. We're getting rid of manuals. Everything's going to become this super electronic sort of driving experience.

Faster on a track. Faster on a track.

Yeah, I mean, I think, yeah, and they are. And by the way, the one nice thing about the PDK, if you drive them in the winter, like I happen to love driving Porsches in the winter, PDK is pretty nice in the snow for what it's worth. But setting that aside is I'm just totally impressed that many of these car companies are kind of going back on what they said they were going to be doing and starting to not reintroduce manuals, but they're producing another extra model with the manual in it.

At a very high price. At a very high price. The Porsche STs or the Sport or all the GT3s, if you want a manual. my gts was the last year it came with a manual which was 24 and the turbo i think 2013 was the last year with the manual something like that so it's amazing they took the supply away and said all right if you want a manual we'll give it to you but it's 300 000 yes yes and what they saw is

they were looking at the auction data like from our auction companies and and others and suddenly the manual version of something. Premium. Huge premium. Absolute premium.

And now manual swaps are showing up in V12 Aston Martins and 430 Ferraris. I see these all the time.

Absolutely. So again, I think it's the return of the analog. People more interested in driving. I mean, I think we're all trying to absorb what COVID did. COVID was a boom time for these kind of cars. But, you know, even afterwards, I think, you know, people were embracing slower hobbies, slower things, you know, playing music, camping, hiking, you know, outdoor pursuits. And, you know, in some of these things, kind of cars sort of fit into that a little bit, which is, you know, something to just go out and take a long, slow Sunday afternoon drive is not something that, you know, the rush, rush world of what mileage does it get and, you know, what's the least payment on it. It comes from a different place, and there's a bigger audience than people think who are willing to spend real money on it.

So there's a data point you guys have referenced I want to ask you about. Quote, we estimate that approximately 12 million enthusiast vehicles will transfer to a new generation in the United States over the next 15 years, either via estate plans or inherences. What is this generational handoff from, I guess we could call them boomer collectors, to millennials and Gen Z? What does this mean for the car collecting community?

Well, and I think we've all read that there's this huge, you know, gigantic wealth transfer, whatever the headline number is.

65 trillion, I've heard 100 trillion, you know, 70.

And, you know, our estimate just on that number of, you know, 13 million vehicles, 12, 13 million vehicles is about $570 billion worth of car value. Right now, most of those are held in, you know, the hands of the generation of baby boomers. I'm an older Gen Xer. You know, Gen Xers are starting to come into their peak wealth, past peak earnings, into peak wealth years, buying a lot of cars. But 15 years from now, about a third of that whole market will come loose back. And again, we're seeing this, certainly the entry points are different than they were a generation ago, where people are interested in sporty cars, trucks, younger kind of, young timer cars, as they refer to them in Europe. And we're seeing the data. We want to position ourselves well to see that the transfers are kind of smooth, where You're, you know, you're kind of helping the next generation get into these cars. We're actually doing things like teaching manual driving classes because, you know, if you talk about it, it's not just an anti-theft device or some slow hobby like brewing beer or whatever it is. It's we need to teach the next generation how to drive manuals. And it's, you know, it's not that hard to do.

Not only is it not that hard, it's just so much more engaging. and not to be a stick snob, but it really is a very different experience. And yeah, I know the GT3 in the PDK is faster than the stick, but how often am I taking my car on a track? If that's once or twice a year, it's a lot. What about the other 360 days a year?

Well, even if you did, you and I, neither of us are good enough drivers to really make a difference. Speak for yourself, McKeel. Okay, one second different in a lap time.

Whatever it is, it's funny because I've done all the high-performance driving classes, and the reality is if you're in a Roush Mustang up at Lime Rock, they said put it into third, leave it there for the whole track. So really driving the stick isn't that much different. But if you're really doing a competitive course, of course not. But first of all, the car doesn't stop. The dual clutches so fast, the engine is always engaged. So you're not losing that tenth of a second when the clutch is down and you're losing power. But it still just feels so much more engaging. Related question to the analog and the manual. So you do a 2025 bull market list. You do one every year.

The average model year of featured cars used to be in the late 80s, early 90s. All of a sudden, it's 2001. How did that happen? What's driving that shift in bull market attracting? Is it that pre-screen, analog, manual feel, but not quite as old as the 70s, 80s cars?

I think so. And I think it's – but it's also – it's a combination of what's driving demand. One is there's absolutely a new cohort of people getting in, making a little bit of money buying these things. At the top end of the market, though, it's not just, oh, the new young tech guy who's going to be in the open AI IPO and is going to make money and go buy a car. Older generation collectors are also buying a lot of these new cars at auction. And it's interesting. I've seen this twice in my career. In the big muscle car era, which was 2005, 6, 7, right before the great financial crisis, everybody said, oh, it's a new generation of people buying all these muscle cars and paying American muscle cars and paying a lot of money for it. And that was true. There were. But it was also the older generation of collectors who liked earlier cars saying, like, well, maybe those are cool and I want one too. And by the way, I have more money than you, so I'm going to outbid you at auction and it's mine. Same thing right now in this sort of like, say, supercar segment, where a lot of these cars from the 90s and 2000s are, we see these values going up. It is the new, you know, kind of newer money, newer collector, but it's an older generation of collectors saying, well, I don't want to be left without a cool car. Or in fact, one guy told me recently who bought a Bugatti Veyron and a couple of newer cars said, well, I want to have a car that my grandkids thinks is cool. And so I'm like, got it.

And that's not the Bugatti Veyron?

No, he loves it. He said, and I'm taking my grandkids and drives in the Bugatti Veyron. And so, you know, they think it's cool.

Yeah, I can imagine. All right, last question before I get to my favorites, because I know we're watching the time. So you guys crunch so much numbers, so many datas. What do you think the casual observer of collector cars misses that your data is revealing?

Yeah, well, I think those big headline cars, they attract so much attention, and people just think it's this crazy, very high-end market of very, very rarefied cars. And while that is true, those are the headline-grabbing numbers. The big story is that there's just a much, much wider opportunity for people who want to play in this space. every single price point, every little bit of reliability, and everything from pickup trucks, like I said, if you live in that part of the world, and that's something that's interesting to you, it's a very broad-based hobby. It's also, you know, this was a hobby that for many, many years was very much male-oriented, male-driven, and I can see that in the data of who our insureds are and everything else. There's a really rising cohort of young women and, you know women who want to have these cars and have it be part of their lives too i think that's probably one of the most exciting trends that um so very broad-based i've noticed a lot more women youtubers talking about cars and coming to cars and coffee with their cars and and that sort of thing so it's um there's just there's a lot more to it it's much broader based and sure it's fun to see a multi-million dollar whatever sell someplace but that's just not that's not the average reality The average is actually much broader based and much more interesting.

So I want to get to our favorite questions, but I got to throw some other stuff. Let's just do a quick speed round. Someone comes up to you and says, hey, I'm interested in a fun weekend car. I don't have a lot of money, but I'd like a convertible stick shift. What do you say? Mustang. Of course.

Yeah, other than Ferrari. You say, of course, because I would have said Miata. Oh, yeah. Well, Mustang or Miata. I mean, so, and I always tell people, like, the oldest Miata is now 33 years old, something like that. Mid-90s. And they made over a million of them for the U.S. market. Super reliable. If you want to go track driving, they're the great track cars. If you want to just cruise around on a weekend, they're inexpensive, $10,000, $15,000. Right. But same thing with Mustang, you know. So just, they're...

And a little more horsepower in the Mustang.

A little bit more horsepower. They made a lot of convertibles. They're manuals. They're automatics if you don't feel comfortable with that. And very, very affordable cars and easy to get serviced. So those would be my two recommendations. Of course, the most collected car, though, still in the United States is a Corvette. And, you know, they've been making them forever. There are lots of them. Easy to service.

And not that, especially like a C6 or C7, not that expensive for a semi-modern car. They're amazing. They're amazing cars. Someone says, I'm interested in something European.

a little more interesting, sporty, where do you send them?

Well, I'm a Porsche person, so I would say, great, you want a 911, but let's start you in a Boxster. You know, let's start you in, you know, whatever, some more entry point there. That younger generation that I talked about, the sort of 3 Series BMWs, super fun cars, lots of them built with a lot of quality. They kind of have style, they look good. That's where people go.

Yeah, those have aged beautifully. the designer, the early BMWs. Someone who's a little more, has a little more scratch, a little older, says hey, I'm looking for something fun but it's going to retain its value and I'm willing to spend more than my kid buying a Boxster. Well then,

it's still probably, I mean again, my bias here, I'd still probably say 9-11, but you're going to pick a year that was maybe a slightly off year, they're going to hold their value well. I've actually, I did a kind of market cap comparison between every 911 ever built, ever built, versus every Ferrari ever built. Because people talk about Ferrari GTOs and all this sort of thing, which are worth tens of

millions. 275s. They were spectacular. And they are. I love them. But when you look at all the

911s that were built, they were really undervalued for a long time. People used to give me a hard time because my 67 911s when i spent over a hundred thousand dollars having it professionally restored not that many years ago i mean after my you know my very amateurish high school restoration i spent a hundred thousand or whatever a little bit more than that and it was worth about 70 right well now it's worth about 300 no kidding yes uh you know 250 300 for a 67s and people say like what's the car what's your 911 worth i'm like i don't care it's my it's my baby and like No one will ever, I and my family will have that car forever.

I have a bias against garage queens, but I'm curious as to your thoughts. People who buy cars, put them in a garage, never drive them.

I think those are really sad cars. Right. They've got to be great for business because there's zero risk. Yeah, the claims are low. But they're sad cars. And especially, by the way, there's not a single generation of cars that fares well when it sits around for a long period of time. Tires age. Belts and hoses age. And some of those 90s and 2000s cars, they age particularly badly when they sit in the garage. Lots of maintenance required. So my view is if you got a car, unless it's like six miles on it or 15 miles, and you just think that's what makes it cool, when there are a lot of customers that we have that like that, my view is go drive it. We sold at our Emilia sale one of the two record-setting Ferrari Enzo's. We sold it for $15 million. The car had, I think, 249 miles on it, Ferrari Enzo. And everybody's like, what do you think of that? I'm like, I would rather have the 20,000-mile Ferrari Enzo than I could go drive. I mean, just personally, myself, and I congratulated the buyer. Wonderful buy, sir. But I would like to...

Please drive it. Please drive it. Doug DeMuro said something really interesting about his Carrera GT when he was hunting for one. He found one with higher mileage because he said, I won't go through the process of, I'm not going to drive this because I'm depreciating it. It's starting out higher mileage, so you're more inclined to put miles on it.

I have one vintage car that has super low miles on it. It's a Jaguar E-Type 1966. It had 13,000 miles on it when I bought it, and it has about 15,000 miles on it now, and it bugs me because I feel like it should be driven, and then I worry that I'm just putting a bunch of miles on it. I don't know. I have the same quandary, so I just like to drive cars.

So we're recording this right after Ferrari dropped their new loose electric appliance. I don't even want to call it. Yeah, it's my Ferrari buddies are not big fans of all the new versions that have been coming out. I still think the 458 is really handsome. I love the A12 GTS. If I ever get that garage built, one of those has my name on it. But the question for you is, when you see these new cars coming out and they're so technology heavy and so screen focused, how do you think these will fare as collectibles 20, 40, 60 years from now?

Well, I can tell you I will never bet against Ferrari. Not ever once. Because, I mean, it is just forever. since the day the first one was built until you know it's just there's been something magical about that brand um i love the history of how the fact that like the second enzo ferrari back in the day would show up with one like everybody knew well that's the car to beat period and even though sometimes you beat them sometimes you didn't they were just the car

to beat and i also remind people that cars like companies like ferrari they've always had different lines of cars you know ferrari i was at race cars but they also always had their like businessman's car you know a front engine slightly less performance 599 612 exactly even a 575 well and the suv the pero sangue like people said they'll never build an suv and i remember i was talking to bob lutz and he just said watch right he said and i'm like why do you think they will build an SUV, Bob? And he said, because

they have to. I was going to say, the Cayenne and the Macan save Porsche. They save Porsche. All right? Ferrari had to be watching that. They had to be seeing the Urus sales, which is essentially a rebadged eight truck from Audi with a whole lot more horsepower. I mean, how did they not do that? They had to.

And I think, I get it, like, this particular electric car has not necessarily had the most favorable initial reviews but my view is i will never count ferrari out and i think they probably are seeing some things in their data and with some certain customers who want this and we'll see well we'll

certainly see so let me jump to my uh favorite question so i don't make you late for your trip back uh to the midwest um who are your early mentors who helped shape your career my my mentors

went from kind of macro-mentors to micro-mentors. And so, you know, in early days, of course, it was my parents. My parents had very different skill sets, and I was so blessed that I got to work with both of them. There were some teachers kind of early on who were really extraordinary professors that both kind of, I think, triggered my love of learning. One gentleman, his name was Gary Hart, still living. I kind of look after him in his old age. He just fundamentally taught me how to be a good student. but what I found though is my mentors have become more micro mentors now like less than it's my whole life learning everything about something from this person is now I find somebody who's really good at one thing and I learn from them I become friends with them my current lead director on our public company board Bill Swanson he was the chairman and CEO of Raytheon and wonderful man car collector and just brilliant at board governance and how to think things through and I'm just learning so much listening to him And so he's a real mentor of mine. And so I think I'm very much of that tribe of mentor approach, and I've had many, and I love mentoring myself.

Huh, really interesting answer. What are some of your favorite books? What are you reading right now?

So I'm an avid reader. I read 30 to 50 books a year, typically, and a lot of biographies in the last four or five years. I was definitely on a music biography stint, so a lot of rock and roll biographies. And then I went through a— Give us a few names. Oh, everything from the Keith Richards to Slash to you name it. I mean, I read a lot of biographies of Springsteen, anybody. Then I did an interesting kind of parallel set, which was music producers. And that was fun. so everything from there's a famous book on Warner Brothers music that was about called Sonic Boom which was all of the music producers that did that to Clive Davis to those types of folks for this year though my reading theme is all about the founding of America so I'm reading a lot of kind of American founding stuff I've just figured it's a good time to do that so biographies so far this year on George Washington Benjamin Franklin there are a bunch of other books around a lot of the founding fathers. I'm also wading through Wealth of Nations again, first time since college, because it was also published in 1776. A little bit of a slog. That's a beast. But I would say one final piece is I was a sci-fi fan forever. Oh, really? Same. I decided for the last two years, I started rereading a bunch of the great series that I read a long time ago. I just read the entire Dune series for the third time in my life. And that was fun. The Foundation series, Asimov, Clark. I think what I had forgotten is that almost all of those sci-fi authors knew each other. Yes. They all kind of subscribe to some of the same magazines and they get together for these little get-togethers. And they were all kind of envisioning a future together. And a lot of same themes, and especially right now around the challenges with AI, are all embedded behind the Foundation series and even in Dune. that people if you kind of have to read into it but it's fascinating stuff um larry niven philip k dick any of those yes um and you know of course you know hitchhikers guide the galaxy so for a

little bit of humor a classic yes uh what are you streaming these days give us your favorite either youtube or netflix or even podcast what what's keeping you yeah so

I mean, my workout companion is a lot of podcasts, and they've kind of shifted, I guess, a little bit. So while I was, you know, during COVID, it was a lot of just sort of habits and mindset stuff and this sort of thing. And then when I discovered people like Scott Galloway, his very humorous way to think about business, Tyler Cowen, I think, is just absolutely brilliant. So great podcast there. I've also been impressed with that Audible has a number of their own kind of, again, back to the musical biography thing. They have a lot of these short format kind of podcasts, kind of other kind of quasi-musical performances that are both kind of spoken word and music. And it's actually called the Words and Music series. And that's been really fun to listen to some of those. Words and music.

I'm going to have to check that out. All right. Our final two questions. what sort of advice would you give a recent college grad interested in a career in either automobiles or insurance or business i think i've just been i've been to two different

commencement uh ceremonies one was my daughters and another was some friends and you know all the commencement speakers right now are so focused on ai and trying to tell them it's going to be okay and not only do i think it's going to be okay so i always remind them and people of my own career, which is I work, my core business is what some people would call as a relatively boring industry, insurance. Now, you got to go into cool other stuff, not go into some of those things. I think there are so many opportunities in these industries that are established, they are stable, they need really smart people who want to work hard and remake what they are, is don't overlook things that you consider boring today. You know, look at some of those and think, who are the types of people that are going into these that you can make a great career, I never imagined I'd be doing what I am today. And I think I have the coolest job you can

have. Really, really interesting. And our final question, what do you know about the world of automobiles or insurance today? Might have been useful 30, 40 years ago when you were first

ramping up. I think, you know, the world has been predicting the demise of certain parts of the automobile industry for years, you know, and we saw it very recently with, you know, this almost like holy war people view the difference between EVs and internal combustion cars. And I'm very agnostic about all of that stuff. And it's very easy to kind of get sucked into those arguments. Like, well, what do you think of EVs? I'm like, I don't know. There were EVs back in 1908. There were steam cars in 1910. And now, you know, we've been on internal combustion for a long time. I think there will be more electric cars in the future, but I also think they're going to be great internal combustion cars. So I think I would just continue playing the big long game and don't worry about some of the little petty arguments that people can have that, you know, it makes for a good maybe cocktail party talk, but I'd like to see the big picture.

McKeel, thank you for being so generous with your time. We have been speaking with McKeel Hagerty, chairman and CEO of Hagerty Specialty Insurance. If you enjoy this conversation, well, be sure and check out any of the 648 we've done previously. You can find those at YouTube, Apple, Spotify, Bloomberg, wherever you get your favorite podcasts. I would be remiss if I didn't thank the crack team that helps us put these conversations together each week. Alexis Noriega is my video producer. Sean Russo is my researcher. Anna Luca is my podcast producer. I'm Barry Ritholtz. You've been listening to Masters in Business on Bloomberg Radio.

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