Hippo Holdings Inc.

1. Description of Business and Summary of Significant Accounting Policies

Description of Business

Hippo Holdings Inc., referred to herein as “Hippo” or the “Company” is an insurance holding company incorporated in Delaware. Hippo has subsidiaries that provide property and casualty insurance products to both individuals and business customers. The Company’s headquarters are located in San Jose, California.

Basis of Presentation and Consolidation

The consolidated financial statements and accompanying notes of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”). The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries where it has controlling financial interests, and any variable interest entities for which the Company is deemed to be the primary beneficiary. All intercompany transactions and balances have been eliminated in consolidation.

Certain prior period amounts have been reclassified in the consolidated financial statements to conform with current year presentation.

Use of Estimates

The preparation of the Company’s consolidated financial statements in conformity with GAAP requires management to make estimates that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting periods. Significant items subject to such estimates and assumptions include, but are not limited to, losses and loss adjustment expense (“LAE”) reserves, provision for commission slide and cancellations, reinsurance recoverable on paid and unpaid losses and LAE, the fair values of investments, stock-based awards, contingent consideration liabilities, acquired intangible assets, deferred tax assets, and uncertain tax positions. The Company evaluates these estimates on an ongoing basis. These estimates are informed by experience and other assumptions that the Company believes are reasonable under the circumstances. Actual results may differ significantly from these estimates.

Business Combinations

The Company accounts for acquisitions of entities or asset groups that qualify as businesses using the acquisition method. Purchase consideration is allocated to the tangible and intangible assets acquired and liabilities assumed based on the estimated fair values as of the acquisition date. The determination of fair value requires management to make estimates about discount rates, future expected cash flows, market conditions and other future events that are highly subjective in nature. The excess of the total purchase consideration over the fair value of the identified net assets acquired is recognized as goodwill. The results of the acquired businesses are included in the results of operations beginning from the date of acquisition. Acquisition-related costs are expensed as incurred.

During the measurement period, which may be up to one year from the acquisition date, the Company may record adjustments to the allocation of purchase consideration and to the fair values of assets acquired and liabilities assumed to the extent that additional information becomes available. After this period, any subsequent adjustments are recorded in the consolidated statements of operations and comprehensive income (loss).

Cash, Cash Equivalents, and Restricted Cash

Cash consists of cash on deposit. The Company considers all highly liquid securities readily convertible to cash, that mature within three months or less from the original date of purchase to be cash equivalents. This includes money market funds, commercial paper, U.S. government and agency securities, and other securities. The Company’s restricted cash relates to cash restricted to support collateral to insurers and fiduciary assets. Restricted cash includes fiduciary assets of $28.7 million and $25.0 million as of December 31, 2025 and December 31, 2024, respectively.

Fiduciary Assets and Liabilities

In its capacity as an insurance agent and broker, the Company collects premiums from insureds and, after deducting its commission, remits the premiums to the respective insurers. The Company also processes claims on behalf of insurers and collects claims from insurers on behalf of insureds. Premiums collected from insureds but not yet remitted to insurance companies and claims collected from insurance companies but not yet remitted to insureds are fiduciary assets. Fiduciary assets are recorded within restricted cash in the Company’s consolidated balance sheets. Unremitted insurance premiums and claims held in a fiduciary capacity and the obligation to remit these funds is recorded as fiduciary liabilities within accrued expenses and other liabilities in the consolidated balance sheets.

Surplus Note

The surplus note is presented at its carrying value, which is its remaining par or face amount net of any related unamortized issuance costs. Issuance costs are amortized using the effective rate interest method. Amortization is recognized as a component of current interest expense.

Segment Reporting

Due to organizational changes and how the chief operating decision maker (“CODM”) views the business, makes operating decisions, assesses financial performance and allocates resources, beginning in the third quarter of 2025, the Company has determined that it currently operates as a single operating and reportable segment at the consolidated level. Prior period segment results and related disclosures have been recast to conform to the current period segment presentation. See Note 19, Segments for further details.

Investments

The Company has categorized its investment portfolio as available-for-sale and has reported the portfolio at fair value, adjusted for allowance for expected credit losses, with unrealized gains and losses, net of tax, reported as an amount in other comprehensive loss. Fair values are based on quoted market prices or dealer quotes, if available. If a quoted market price is not available, fair value is estimated using quoted market prices for similar securities. Amortization of premium and accretion of discount are computed using the scientific method (constant yield to worst). Realized gains and losses are determined using specific identification method and included in the determination of income. Net investment income includes interest and dividend income, amortization and accretion of investment premiums and discounts, respectively, realized gains and losses on sales of securities, and changes in the allowance for expected credit losses in the fair value of securities, if any.

The Company reviews all securities with unrealized losses on a quarterly basis to assess whether the decline in the securities fair value necessitates the recognition of an allowance for credit losses. Factors considered in the review include the extent to which the fair value has been less than amortized cost, and current market interest rates and whether the unrealized loss is credit-driven or a result of changes in market interest rates. The Company also considers factors specific to the issuer including the general financial condition of the issuer, the issuers industry and future business prospects, any past failure of issuer to make scheduled interest or principal payments, and the payment structure of the investment and the issuers ability to make contractual payments on the investment.

The Company also considers whether it intends to sell the security or if it is more likely than not that it will be required to sell the security before recovery of its amortized cost. When assessing whether it intends to sell a fixed-maturity security or if it is likely to be required to sell a fixed-maturity security before recovery of its amortized cost, the Company evaluates facts and circumstances including, but not limited to, decisions to reposition the investment portfolio, potential sales of investments to meet cash flow needs, and potential sales of investments to capitalize on favorable pricing.

For fixed-maturity securities where a decline in fair value is below the amortized cost basis and the Company intends to sell the security, or it is more likely than not that the Company will be required to sell the security before recovery of its amortized cost, a credit-loss charge is recognized in net income based on the fair value of the security at the time of assessment. For fixed-maturity securities that the Company has the intent and ability to hold, the Company compares the estimated present value of the cash flows expected to be collected to the amortized cost of the security. The extent to which the estimated present value of the cash flows expected to be collected is less than the amortized cost of the security represents the credit-related portion of the impairment, which is recognized in net income through an allowance for credit losses. Any remaining decline in fair value represents the noncredit portion of the impairment, which is recognized in other comprehensive income.

The Company did not identify any available-for-sale securities as of December 31, 2025 which presented a risk of loss due to credit deterioration of the security.

Fair Value of Financial Instruments

The Company applies fair value accounting for all financial assets and liabilities and non-financial assets and liabilities that are recognized or disclosed at fair value in the consolidated financial statements on a recurring basis. The Company defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities, which are required to be recorded at fair value, the Company considers the principal or most advantageous market in which the Company would transact and the market-based risk measurements or assumptions that market participants would use in pricing the asset or liability, such as risks inherent in valuation techniques, transfer restrictions, and credit risk. Fair value is estimated by applying the following hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement:

•Level 1 — Quoted prices in active markets for identical assets or liabilities that are publicly accessible at the measurement date.

•Level 2 — Observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

•Level 3 — Inputs that are generally unobservable and typically reflect management’s estimate of assumptions that market participants would use in pricing the asset or liability.

The Company’s financial instruments include cash equivalents, restricted cash, fixed maturities, short-term investments, accounts receivable, accounts payable, assumed and ceded reinsurance contracts. Cash equivalents and restricted cash are principally stated at amortized cost, which approximates their fair value. Fixed maturities and short-term investments are reported at fair value, and are primarily valued using prices obtained from independent third-party pricing services.The recorded carrying amount of accounts receivable, assumed and ceded reinsurance contracts, and accounts payable approximates their fair value due to their short-term nature.

Concentration of Credit Risks

Financial instruments that potentially subject the Company to concentrations of credit risk are primarily comprised of cash and cash equivalents, short-term investments, fixed maturities available-for-sale, and reinsurance recoverables. Cash deposits may, at times, exceed amounts insured by the Federal Deposit Insurance Corporation and the Securities Investor Protection Corporation. However, its exposure to credit risk in the event of default by the financial institutions is limited to the extent of amounts recorded on the consolidated balance sheet. The Company performs evaluations of the relative credit standing of these financial institutions to limit the amount of credit exposure. The Company has not experienced any losses on its deposits of cash and cash equivalents to date. The Company limits its exposure to credit losses by investing in money market funds, U.S. government securities, or securities with average credit quality of AA- or better. Premium receivables are a mix of receivables due from policyholders, agents, and program administrators. The Company has no significant off-balance-sheet concentration of credit risks such as foreign exchange contracts, option contracts, or other foreign hedging arrangements.

The Company enters into quota share and excess of loss contracts which may be susceptible to catastrophe exposure. The ceding of insurance does not legally discharge the Company from its primary liability for the full amount of the policy coverage, and therefore the Company will be required to pay the loss and bear collection risk if the reinsurer fails to meet its obligations under the reinsurance agreement. To minimize exposure to significant losses from reinsurance insolvencies, the Company evaluates the financial condition of its reinsurers, monitors concentrations of credit risk and, in certain circumstances, holds substantial collateral (in the form of funds withheld and letters of credit) as security under the reinsurance agreements.

Accounts Receivable

Accounts receivable consists of premium receivables and commission receivables and is reported net of an allowance for premium amounts or estimated uncollectible commission. Generally premiums and commissions are collected prior to providing coverage, minimizing the Company’s exposure to credit risk. Premiums and commissions receivable are short-term in nature and due within a year. The Company has established an allowance for uncollectible premiums and commissions related to credit risk, which it reviews on a quarterly basis. In its review, the Company considers length of collection periods, the creditworthiness of the insured, economic environment, specific regulatory developments and other relevant factors. Amounts deemed to be uncollectible are written off against the allowance.

Write-offs of receivables have not been material to the Company during the years ended December 31, 2025, 2024 and 2023.

Reinsurance

Reinsurance recoverable, including amounts related to incurred but not reported claims (“IBNR”), represent paid losses and LAE and reserves for unpaid losses and LAE ceded to reinsurers that are subject to reimbursement under reinsurance treaties. To minimize exposure to losses related to a reinsurer’s inability to pay, the financial condition of such reinsurer is evaluated initially upon placement of the reinsurance and periodically thereafter. In addition to considering the financial condition of a reinsurer, the collectability of the reinsurance recoverable is evaluated based upon a number of other factors. Such factors include the amounts outstanding, length of collection periods, disputes, any collateral or letters of credit held and other relevant factors. Historically, the Company has not experienced any credit losses from reinsurance recoverables as of December 31, 2025 and 2024, respectively. The Company evaluates its reinsurance recoverables on a quarterly basis for risk of loss due to credit deterioration, including evaluating historical collection trends, reinsurer credit ratings, and other economic factors that may affect collectability of its reinsurance receivables due to credit deterioration To the extent that an allowance for uncollectible reinsurance recoverable is established, amounts deemed to be uncollectible would be written off against the allowance for estimated uncollectible reinsurance recoverable. The Company currently has no material allowance for uncollectible reinsurance recoverable.

Ceded premium written is recorded in accordance with the applicable terms of the reinsurance contracts and ceded premium earned is charged against revenue over the period of the reinsurance contracts. Ceded losses incurred reduce net losses and LAE incurred over the applicable periods of the reinsurance contracts with third-party reinsurers.

Loss participation features in the reinsurance agreements are estimated at each reporting period and recorded as an adjustment to losses and LAE.

Commission slide features in the reinsurance agreements are estimated at each reporting period and recorded as an adjustment to commission income, net.

For ceded reinsurance, risk transfer requirements must be met for reinsurance accounting to apply. If risk transfer requirements are not met, the contract is accounted for as a deposit, resulting in the recognition of cash flows under the contract through a deposit asset or liability and not as revenue or expense. To meet risk transfer requirements, a reinsurance contract must include both insurance risk, consisting of both underwriting and timing risk, and a reasonable possibility of a significant loss for the assuming entity. Similar risk transfer criteria are used to determine whether directly written insurance contracts should be accounted for as insurance or as a deposit.

Prepaid reinsurance premiums represents the unearned portion of premiums ceded to reinsurers.

Amounts recoverable from reinsurers are estimated in a manner consistent with the liability associated with the reinsured business and consistent with the terms of the underlying contract.

Deferred Policy Acquisition Costs, net of Ceding Commissions

Incremental direct costs of acquiring insurance contracts and certain costs related directly to the acquisition process are deferred and amortized over the term of the policies or reinsurance treaties to which they relate. Those costs include commissions, premium taxes, and board and bureau fees. Ceding commissions relating to reinsurance agreements are recorded as a reimbursement for both deferrable and non-deferrable acquisition costs. The portion of the ceding commission that is equal to the pro-rata share of acquisition costs based on quota share percentage is recorded as an offset to the direct deferred acquisition costs. Any portion of the ceding commission that exceeds the deferrable acquisition costs of the business ceded is recorded as a deferred liability and amortized over the same period in which the related premiums are earned. The amortization of deferred policy acquisition costs is included in insurance related expenses on the consolidated statements of operations and comprehensive income (loss).

Premium Deficiency

A premium deficiency is recognized if the sum of expected losses and LAE, unamortized acquisition costs, and policy maintenance costs exceeds the remaining unearned premiums. A premium deficiency would first be recognized by charging any unamortized acquisition costs to expense to the extent required to eliminate the deficiency. If the premium deficiency was greater than unamortized acquisition costs, a liability would be accrued for the excess deficiency. The Company considers anticipated investment income when determining if a premium deficiency exists. The Company didnot recognize a premium deficiency as of December 31, 2025, 2024 and 2023.

Property and Equipment

Property and equipment is stated at cost, net of accumulated depreciation and is reflected within other assets on the consolidated balance sheets. Depreciation of property and equipment is calculated using the straight-line method over the estimated useful life ofthirty-nine years for buildings, five years for furniture, fixtures, and equipment, andthree years for computer equipment. Leasehold improvements are also depreciated using the straight-line method and are amortized over the shorter of the remaining term of the lease or the useful life of the improvement. Depreciation expense totaled $1.5 million, $2.0 million and $2.3 million for the years ended December 31, 2025, 2024 and 2023, respectively.

Expenditures for improvements are capitalized, and expenditures for maintenance and repairs are expensed as incurred. Upon sale or retirement, the cost and related accumulated depreciation is removed from the related accounts, and the resulting gain or loss, if any, is reflected in other (income) expense in the consolidated statements of operations and comprehensive income (loss).

Leases

Leases arise from contractual obligations that convey the right to control the use of an identified property, plant or equipment for a stated time period in exchange for consideration. The Company determines if an arrangement is, or contains a lease at contract inception. Lease classification is determined at the lease commencement date, on which the leased assets are available for the Company’s use. The Company recognizes a right-of-use asset (“ROU”) and a corresponding lease liability at commencement date for operating leases. ROU assets are presented under other assets, and lease liabilities are presented under accrued expenses and other liabilities in the consolidated balance sheets. The Company did not have any material finance leases in the periods presented.

ROU assets represent the Company’s right to use an underlying asset during the lease term and lease liabilities represent the Company’s obligation to make payments during the lease term. ROU assets are recognized at the lease commencement date for the lease liability amount, adjusted for initial direct costs incurred and lease incentives received. Lease liabilities are recognized at commencement based on the present value of the future lease payments over the lease term. Lease terms may include options to extend or terminate the lease when the Company believes it is reasonably certain that the Company will exercise such options. Since the implicit discount rate for operating leases is not readily determinable, the Company uses an estimate of its incremental borrowing rate (“IBR”) on the lease commencement date in determining the present value of lease payments. IBR is determined based on information available at lease commencement including interest rates, credit ratings, credit spreads, and lease term. Operating lease expense is recognized on a straight-line basis over the lease term.

The Company accounts for lease and non-lease components as a single lease component. Accordingly, the Company includes fixed non-lease components with lease payments for the purpose of calculating lease right-of-use assets and liabilities. Non-lease components that are not fixed are expensed as incurred as variable lease payments. The Company does not record leases on the balance sheet that have a term of 12 months or less at the lease commencement date.

Capitalized Internal Use Software

The Company capitalizes the costs to develop its internal use software when preliminary development efforts are successfully completed, management has authorized and committed project funding, it is probable that the project will be completed, and the software will be used as intended. Such costs are amortized on a straight-line basis over the estimated useful life offive years. Costs incurred prior to meeting these criteria, in addition to costs incurred for training and maintenance, are expensed as incurred. The amortization expense is recognized within insurance related expenses in the Company's statement of operations and comprehensive income (loss).

Acquired Intangible Assets

The Company accounts for business combinations using the acquisition method of accounting, which requires that assets acquired and liabilities assumed be recorded at their fair values as of the acquisition date on the consolidated balance sheets. Any excess of purchase price over the fair value of net assets acquired is recorded as goodwill. The determination of estimated fair value requires the Company to make significant estimates and assumptions. Transaction costs associated with business combinations are expensed as they are incurred.

Included in the purchase price of an acquisition may be an estimation of the fair value of liabilities associated with contingent consideration. The fair value of contingent consideration is based upon the present value of the expected future payments to be made to the sellers of an acquired business in accordance with the provisions contained in the respective purchase agreements. Subsequent changes in the fair value of contingent consideration are recorded in the consolidated statements of operations and comprehensive income (loss).

When the Company determines that net assets acquired does not meet the definition of a business combination under the acquisition method of accounting, the transaction is accounted for as an acquisition of assets and, therefore, no goodwill is recorded.

Amortization and Impairment

Intangible assets with finite useful lives are amortized over their estimated useful lives in the consolidated statements of operations and comprehensive income (loss). The amortization expense is included in technology and development expenses for developed technology and sales and marketing expenses for customer relationships, agency relationships, carrier relationships, and other.

Indefinite-lived intangible assets are not amortized but are tested for impairment annually, or more frequently if necessary. Indefinite-lived intangible assets are tested for impairment by comparing the estimated fair value of the asset to the asset’s carrying value. If the carrying value of the asset exceeds its estimated fair value, an impairment loss is recognized, and the asset is written down to its estimated fair value. There were no material impairment losses recognized on indefinite-lived intangible assets during the years ended December 31, 2025 and 2024.

The Company evaluates the recoverability of long-lived assets, excluding goodwill and indefinite-lived intangible assets, whenever events or changes in circumstances indicate the carrying value of such assets may not be recoverable. Should there be an indication of impairment, the Company tests for recoverability by comparing the estimated undiscounted future cash flows expected to result from the use of the asset to the carrying amount of the asset or asset group. If the asset or asset group is determined to be impaired, any excess of the carrying value of the asset or asset group over its estimated fair value is recognized as an impairment loss. There were no material impairment losses recognized on long-lived assets during the years ended December 31, 2025 and 2024.

Losses and Loss Adjustment Expense Reserve

The reserve for unpaid losses and loss adjustment expenses include estimates for unpaid claims, claims adjustment expenses on reported losses and estimates of losses incurred but not reported, net of salvage and subrogation recoveries. The liability is based on the Company’s best estimate of the amounts yet to be paid for all loss and loss adjustment expenses that will be paid on claims that occurred during the period and prior, whether those claims are currently known or unknown.

Losses and loss adjustment reserves are the amount of ultimate loss and loss adjustment expense less the paid amounts as of the balance sheet date.

Ultimate losses and loss adjustment expense is the sum of the following items:

1. Losses and loss adjustment expense paid through a given evaluation date

2. Case reserves for loss and loss adjustment expense for losses that have been reported but not yet paid as of a given evaluation date

3. IBNR for losses and loss adjustment expense include an estimate for future loss payments on incurred claims not yet reported and for expected development on reported claims

Case reserves are established within the claims adjustment process based on all known circumstances of a claim at the time. In addition, IBNR reserves are established by the Company based on reported loss and loss adjustment expenses and estimates of ultimate loss and loss adjustment expenses based on generally accepted actuarial reserving techniques that consider quantitative loss experience data and qualitative factors as appropriate.

The most significant assumptions used in the determination of the recorded reserve for loss and loss adjustment expenses are historical aggregate claim reporting and payment patterns, which is assumed to be indicative of future loss development and trends. Additionally, claim counts are used for analyses relating to natural disasters, such as hurricanes, earthquakes, and wildfires as losses from these events are inherently more difficult to estimate due to the potential exposure of the catastrophic events. Other assumptions considered include information developed from internal and independent external sources such as premium, rate and cost trends, litigation and regulatory trends, legislative activity, climate change, social and economic patterns.

Inherent in the estimates of ultimate loss and loss adjustment expenses are expected trends in claims severity and frequency among other factors that could vary significantly as claims are settled. The Company’s loss and loss adjustment expense reserves are continually reviewed, and adjustments, if any, are reflected in current operations in the consolidated statements of operations and comprehensive income (loss) in the period in which they become known. The establishment of new losses and loss adjustment expense reserves or the adjustment of previously recorded loss and loss adjustment expense reserves could result in significant positive or negative changes to the Company’s financial condition for any particular period. While the Company believes that it has made a reasonable estimate of losses and loss adjustment expense reserves, the ultimate loss experience may not be as reliably predicted as may be the case with other insurance expenses, and it is possible that actual loss and loss adjustment expenses will be higher or lower than the loss and loss adjustment reserve amount recorded by the Company.

Provision for Commission

Provision for commission includes return commission payable to insurers, or commission slide, based on the actual performance of insurance policies placed by the Company against a contractual range of performance targets. The Company’s reserve estimation is based on current and historical performance of the portfolio of insurance policies placed with the insurance carriers.

Provision for commission also includes cancellation reserves which represent the Company’s estimate of return commission payable to insureds based on policy cancellations after the effective date. The Company’s estimation for the reserve uses historical policy cancellation.

The return commission payable to insurers and cancellation reserves are based on assumptions and estimates, and while management believes the amount recorded is the Company’s best estimate, the ultimate liability may differ from the amount recorded. The methods for making such estimates and for establishing the resulting liability are continually reviewed, and any adjustments are reflected in the period in which they become known.

Revenue Recognition

Net Earned Premium

Net earned premium represents the earned portion of the Company’s gross written premium for insurance policies written or assumed by the Company and less the earned portion of ceded written premium (any portion of the Company’s gross written premium that is ceded to third-party reinsurers under the Company’s reinsurance agreements). The Company earns written premiums on a pro-rata basis over the term of the policies.

Commission Income, Net

Commission income, net includes agency commission which the Company earns from the unaffiliated carriers whose policies it sells, ceding commission on the premium the Company cedes to third-party reinsurers, and fronting fees from the managing general agent (“MGA”) programs it supports. Agency commission revenue is recognized when the related performance obligations are satisfied. The performance obligation from the agency contracts is the placement of the insurance policies. The Company recognizes agency commission received from insurers for the sale of insurance contracts as revenue at a point in time on the policy effective dates. The Company earns commission on ceded reinsurance premium in a manner consistent with the recognition of the earned premium on the underlying insurance policies, on a pro-rata basis over the terms of the policies reinsured. The Company earns fronting fees in a manner consistent with the recognition of the earned premium on the underlying insurance policies, on a pro-rata basis over the terms of the policies.

Service and Fee Income

Service and fee income mainly represents policy fees and other revenue. The Company directly bills policyholders for policy fees and collect and retain fees per the terms of the contracts between the Company and its insurers. Similar to the commission revenue, the Company estimates a cancellation reserve for policy fees using historical information. The performance obligation associated with these fees is satisfied at a point in time upon completion of the underwriting process, which is the policy effective date. Accordingly, the Company recognizes all fees as revenue on the policy effective date.

Net Investment Income

Net investment income represents interest earned from fixed maturity securities, short-term investments and other investments, and the gains or losses from the sale of investments. The Company’s cash and invested assets primarily consist of fixed-maturity securities, and may also include cash and cash equivalents, equity securities, and short-term investments. The principal factors that influence net investment income are the size of its investment portfolio and the yield on that portfolio. As measured by amortized cost (which excludes changes in fair value, such as changes in interest rates), the size of its investment portfolio is mainly a function of its invested equity capital along with premiums the Company receives from its customers less payments on customer claims.

Net investment income also includes an insignificant amount of net realized gains (losses) on investments, which are a function of the difference between the amount received by us on the sale of a security and the security’s amortized cost, as well as any allowances for credit losses recognized in earnings, if any.

Disaggregated Revenue

The following table disaggregates the Company’s revenues by major source:

Materially all revenues for the years ended December 31, 2025, 2024 and 2023 are from business conducted in the United States.

Insurance-Related Expenses

Insurance related expenses primarily consist of amortization of direct acquisition commission costs and premium taxes incurred on the successful acquisition of business written on a direct basis and credit card processing fees not charged to the Company’s customers. Insurance related expenses also include employee compensation (including stock-based compensation and benefits) of the Company’s underwriting teams, amortization of capitalized internal use software, as well as allocated occupancy costs and related overhead based on headcount. Insurance related expenses are offset by a portion of ceding commission income, which represents reimbursement of successful acquisition costs related to the underlying policies. Additionally, insurance related expenses include the costs of providing bound policies and delivering claims services to the Company’s customers. These costs include underwriting technology service costs including software, data services used for performing underwriting, and third-party call center costs in addition to personnel-related costs.

Technology and Development Expenses

Technology and development expenses primarily consist of employee compensation (including stock-based compensation and benefits) for the Company’s technology staff, which includes technology development, infrastructure support, actuarial, and third-party services. Technology and development expenses also includes allocated facility costs and related overhead based on headcount.

Sales and Marketing Expenses

Sales and marketing expenses primarily consist of sales commissions, advertising costs, and marketing expenditures, as well as employee compensation (including stock-based compensation and benefits) for employees engaged in sales, marketing, data analytics, and customer acquisition. The Company expenses advertising costs as incurred. Sales and marketing expenses also include allocated facility costs and related overhead based on headcount. Advertising costs were $2.1 million, $3.3 million and $10.2 million for the years ended December 31, 2025, 2024 and 2023, respectively.

General and Administrative Expenses

General and administrative expenses primarily consist of employee compensation (including stock-based compensation and benefits) for the Company’s finance, human resources, legal, and general management functions as well as facilities, insurance, and professional services.

Impairment and Restructuring Charges

Impairment and restructuring charges consist of non-cash impairment charges relating to leases. It also consists of severance and other personnel costs associated with exit and disposal activities as well as reductions in workforce.

Interest and other (income) expense, net

Interest and other (income) expense, net primarily consists of interest expense on the Company’s surplus note, as well as certain fair value adjustments and other non-operating income expenses.

Gain on Sale of Business

Gain on sale of business is measured as the fair value of consideration received in excess of the carrying value of the assets and liabilities sold.

Stock-Based Compensation Expense

The Company recognizes stock-based compensation expense based on the estimated fair value of equity-based payment awards on the date of grant, using the Black-Scholes-Merton option-pricing model or the Monte Carlo valuation model for market-based awards. The Company recognizes stock-based compensation expenses for the value of its awards granted, based on the straight-line method over the requisite service period of each of the awards in the Company’s consolidated statements of operations and comprehensive income (loss). The Company has elected to record forfeitures as they occur.

Income Taxes

The Company accounts for income taxes using the asset and liability method, under which deferred tax liabilities and assets are recognized for the expected future tax consequences of temporary differences between consolidated financial statement carrying amounts and the tax basis of assets and liabilities and net operating loss and tax credit carryforwards. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. The effect on deferred taxes of a change in tax rate is recognized in income in the period that includes the enactment date.

The Company accounts for application of the U.S. Global Intangible Low Taxed Income rules by recognizing the tax in the period in which it is incurred.

The Company determines whether it is more likely than not that a tax position will be sustained upon examination. If it is not more likely than not that a position will be sustained, no amount of benefit attributable to the position is recognized. The tax benefit to be recognized of any tax position that meets the more-likely-than-not recognition threshold is calculated as the largest amount that is more than 50% likely of being realized upon resolution of the contingency.

Net Income (Loss) Per Share Attributable to Common Stockholders of Hippo Holdings Inc.

Basic and diluted net income (loss) per share attributable to common stockholders of Hippo Holdings Inc. is presented in conformity with the two-class method required for common stock and participating securities. Under the two-class method, net income (loss) is attributed to common stockholders and participating securities based on their participation rights. The Company considers all series of its unvested common stock to be participating securities as holders of such securities have non-forfeitable dividend rights in the event of the Company’s declaration of a dividend for shares of common stock.

Under the two-class method, the net income (loss) attributable to common stockholders of Hippo Holdings Inc. is not allocated to the unvested common stock as these securities do not have a contractual obligation to share in the Company’s income or losses.

Distributed and undistributed earnings allocated to participating securities are subtracted from net income (loss) in determining net income (loss) attributable to common stockholders. Under the two-class method, basic net income (loss) per share attributable to common stockholders is computed by dividing the net income (loss)

attributable to common stockholders by the weighted-average shares used in computing net income (loss) per share attributable to common stockholders.

For periods in which the Company reports net losses, diluted net loss per share attributable to common stockholders is the same as basic net loss per share attributable to common stockholders because potentially dilutive common shares are not assumed to have been issued if their effect is anti-dilutive.

Recent Accounting Pronouncements

Recently Adopted Accounting Pronouncements

In December 2023, the FASB issued ASU No. 2023-09, Improvements to Income Tax Disclosures, which requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as information on income taxes paid. The standard is intended to benefit investors by providing more detailed income tax disclosures that would be useful in making capital allocation decisions. This ASU is effective for public companies with annual periods beginning after December 15, 2024, with early adoption permitted. The Company is required to adopt the guidance for its Annual Report on Form 10-K for the year ended December 31, 2025. The Company has adopted the provisions of ASU 2023-09 on a prospective basis and have included the required disclosures in this Annual Report.

Accounting Pronouncements Not Yet Adopted

In November 2024, the FASB issued ASU No. 2024-03, Disaggregation of Income Statement Expenses, which requires additional disclosure of the nature of expenses included in the income statement in response to longstanding requests from investors for more information about an entity’s expenses. The new standard requires disclosures about specific types of expenses included in the expense captions presented on the face of the income statement as well as disclosures about selling expenses. This ASU is effective for public companies with annual periods beginning after December 15, 2026, and interim periods within annual periods beginning after December 15, 2027. The requirements will be applied prospectively with the option for retrospective application. Early adoption is permitted.

In January 2025, the FASB issued ASU No. 2025-01, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures: Clarifying the Effective Date, clarifying the interim reporting date when an entity must adopt ASU No. 2024-03. According to ASU No. 2025-01, ASU No. 2024-03 is effective for interim periods within fiscal years beginning after December 15, 2027. The Company is currently evaluating the impact of this standard on its consolidated financial statements and does not expect this standard to have a material impact on its financial statements.

In July 2025, the FASB issued ASU No. 2025-05, Measurement of Credit Losses for Accounts Receivable and Contract Assets, which provides (1) all entities with a practical expedient and (2) entities other than public business entities with an accounting policy election when estimating credit losses for current accounts receivable and current contract assets arising from transactions accounted for under Topic 606. This ASU is effective for annual reporting periods beginning after December 15, 2025 and interim reporting periods within those annual reporting periods. Early adoption is permitted in both interim and annual reporting periods in which financial statements have not yet been issued or made available for issuance. The Company is currently evaluating the impact of these amendments to its consolidated financial statements.

In September 2025, the FASB issued ASU No. 2025-06, Targeted Improvements to the Accounting for Internal-Use Software, which amends guidance related to the accounting for internal-use software development costs. The amendments are intended to modernize the recognition and capitalization framework to reflect current software development practices, including iterative and agile methodologies, by removing references to “development stages.” It also clarifies the criteria for capitalization, which begins when both of the following occur: (1) management has authorized and committed to funding the software project and (2) it is probable that the project will be completed and the software will be used to perform the function intended. This ASU is effective for annual periods beginning after December 15, 2027, and interim periods within those annual periods. Early adoption is permitted. The Company is currently evaluating the impact the new accounting standard will have on its policy for capitalization of development costs for software intended for internal use.

In December 2025, the FASB issued ASU No. 2025-12, Codification Improvements, which addresses thirty-three items, representing the changes to the Codification that (1) clarify, (2) correct errors, or (3) make minor improvements. Generally, the amendments in this Update are not intended to result in significant changes for most entities. The ASU is effective for interim reporting periods within annual reporting periods beginning after December 15, 2026. The adoption method of this ASU may vary, on an issue-by-issue basis. Early adoption is permitted. The Company is currently evaluating the impact of this standard on its consolidated financial statements and does not expect this standard to have a material impact on its financial statements.

2. Investments

The amortized cost and fair value of fixed maturities securities and short-term investments are as follows:

The following tables present the gross unrealized losses and related fair values for the Company’s investments in available-for-sale debt securities and short-term investments, grouped by duration of time in a continuous unrealized loss position as of December 31, 2025 and December 31, 2024:

The Company has determined that unrealized losses as of December 31, 2025 and December 31, 2024 resulted from the interest rate environment, rather than a deterioration of the creditworthiness of the issuers.

Therefore, an allowance for credit losses was not necessary as it is more likely than not that the Company will not be required to sell the investments before the recovery of the amortized cost basis or until maturity. As of December 31, 2025, none of the Company’s fixed-maturity portfolio was unrated or rated below investment grade.

The amortized cost and fair value of fixed-maturities securities by contractual maturity are as follows:

Expected maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties.

Net realized gains and losses on fixed-maturity securities were insignificant for the years ended December 31, 2025, 2024 and 2023, respectively.

The Company’s net investment income is comprised of the following:

Pursuant to certain regulatory requirements, the Company is required to hold assets on deposit with various state insurance departments for the benefit of policyholders. These special deposits are included in cash and cash equivalents, fixed maturities, or short-term investments on the consolidated balance sheets. The carrying value of securities on deposit with state regulatory authorities total $13.3 million and $12.2 million as of December 31, 2025 and December 31, 2024, respectively.

3. Fair Value Measurement

The following table summarizes the Company’s fair value hierarchy for its financial assets and liabilities measured at fair value on a recurring basis:

The Company’s policy is to recognize transfers into and transfers out of fair value hierarchy levels at the end of each reporting period. There were no other transfers between levels in the fair value hierarchy during the years ended December 31, 2025.

Contingent Consideration

The contingent consideration, relating to the Company’s 2019 acquisition of North American Advantage Insurance Services, LLC is re-valued to fair value at the end of each reporting period using the present value of future payments based on an estimate of revenue and customer renewals of the acquiree. North American Advantage Insurance Services, LLC’s ultimate parent company was Lennar Corporation, a related party of the Company. The contingent consideration liability was part of the net assets transferred in the sale of the Company’s homebuilder distribution network. See Note 18, Acquisitions and Dispositions for further details.

Non-Recurring Fair Value Measurements

The Company has a 19.2% ownership stake in First Connect Insurance Services (“First Connect”), a non-public company. The Company estimates the fair value on a non-recurring basis using the fair value of First Connect’s common stock, as applicable. Because of the nature of the unobservable inputs, the Company classifies this retained interest as Level 3 in the fair value hierarchy. The fair value of the Company’s investment was $4.5 million and $4.1 million as of December 31, 2025 and 2024, is included in Other Assets on the consolidated balance sheets. See Note 18, Acquisitions and Dispositions for further details.

4. Intangible Assets

Amortization expense related to intangible assets for the years ended December 31, 2025, 2024 and 2023 was $1.7 million, $4.6 million, $4.4 million, respectively. The amortization expense is primarily included in sales and marketing expenses for customer relationships, agency and carrier relationships, and other on the consolidated statements of operations and comprehensive income (loss).

As of December 31, 2025, the projected annual amortization expense for the Company’s intangible assets for the next five years is as follows:

5. Capitalized Internal Use Software

(1)This balance is net of an asset impairment charge of $3.8 million and is recognized in the Impairment and restructuring charges in the consolidated statements of operations and comprehensive income (loss) for the year ended December 31, 2025.

Amortization expense related to capitalized internal use software for the years ended December 31, 2025, 2024 and 2023 was $17.1 million, $16.6 million, and $13.1 million, respectively. The amortization expense is included in insurance related expenses on the consolidated statements of operations and comprehensive income (loss).

6. Other Assets

Policy acquisition costs deferred, net for the years ended December 31, 2025 and 2024 were $74.0 million and $37.4 million, respectively. The Company amortized deferred policy acquisition costs of $57.0 million, $45.2 million, and $32.3 million for the years ended December 31, 2025, 2024 and 2023, respectively.

7. Accrued Expenses and Other Liabilities

8. Surplus Note

The Company issued a surplus note on June 2, 2025 in the amount of $50.0 million with a fixed interest rate of 9.5% for a term of 15 years. The surplus note is callable by the Company in 7 years. Interest on the outstanding principal is payable on September 1 and March 1 every year. Payment of principal and interest requires regulatory approval before such payment may be made. The Company paid $1.2 million in interest for the year ended December 31, 2025.

The Company’s surplus note is recorded at its carrying value. The estimated fair value of the surplus note as of December 31, 2025 approximates its carrying value. The fair value measurement is classified as Level 2 within the fair value hierarchy based on the observable transaction price.

9. Losses and Loss Adjustment Expense Reserves

The liability for unpaid losses and LAE represents the Company’s estimate of its obligation for claims arising from insured events that have occurred on or before the balance sheet date. The liability includes case reserves and IBNR amounts and is recorded on an undiscounted basis.

The following table presents a reconciliation of the beginning and ending reserve balances for losses and loss adjustment expenses for the years ended December 31, 2025, 2024, and 2023:

The gross losses and LAE reserve is included in Losses and loss adjustment expenses and the reinsurance recoverables are included in Reinsurance recoverable on paid and unpaid losses and LAE on the consolidated balance sheets.

Prior year loss development occurs when actual losses incurred vary from the Company’s previously estimated losses, which are established through the Company’s losses and LAE reserve estimate processes.

Net incurred losses and LAE experienced favorable prior years development of $9.5 million, $6.1 million and $2.0 million for the years ended December 31, 2025, 2024 and 2023, respectively.

The prior period development for the year ended December 31, 2025 of $9.5 million was driven primarily by favorable net loss development relating to the 2024 and prior accident years, resulting in a net release of $6.9 million from attritional reserves and $2.6 million from catastrophe reserves. This development was driven by improved attritional loss experience in the 2024 and 2023 accident years, primarily within property lines, which emerged more favorably than previously estimated. The impact of this development also reflects the Company's reinsurance structure in place for those accident years, specifically the loss retention features under previous quota share agreements.

The prior period development for the year ended December 31, 2024 of $6.1 million was driven primarily by favorable net loss development relating to the 2023 and prior accident years, resulting in a net release of $2.9 million from attritional reserves and $3.2 million from catastrophe reserves. These changes are primarily a result of ongoing analysis of claims emergence patterns and loss trends.

The prior period development for the year ended December 31, 2023 of $2.0 million was driven primarily by favorable net loss development relating to the 2022 accident year, resulting in a net release of $2.1 million from catastrophe reserves. These changes are primarily a result of ongoing analysis of claims emergence patterns and loss trends.

There were no material changes in actuarial methodologies during the periods presented.

Short duration contract disclosures

For purposes of the development disclosures, losses and LAE reserves are disaggregated into Property and Casualty groupings based on expected claim duration characteristics and related estimation uncertainty. Property lines are generally characterized as short-tail and include coverages with shorter reporting and settlement periods, while Casualty lines are generally characterized as mid-tail, reflecting differences in the timing and uncertainty of claim payments.

The following tables present information about incurred and paid loss development as of December 31, 2025, net of reinsurance, as well as cumulative reported claim count and total of IBNR reserves. The development tables include allocated loss adjustment expenses.

Cumulative reported claim counts represent the number of reported claims by loss occurrence and does not include claims that do not result in indemnification of loss. Claim count methodologies have been applied consistently for all periods presented.

Information about incurred and paid claims develo pment for the years ended prior to December 31, 2025 is presented as unaudited supplementary information. In addition, the following tables show incurred losses and LAE by accident year in aggregate (in millions, except for number of claims):

Property Lines Incurred Losses and LAE development, Net of Reinsurance

Property Lines Cumulative Paid Losses and LAE development, Net of Reinsurance

Casualty Lines Losses and LAE development, Net of Reinsurance

Casualty Lines Cumulative Paid Losses and LAE development, Net of Reinsurance

Information about historical claim duration

The following table presents supplementary information about the average annual percentage payout of incurred losses by age, net of reinsurance as of December 31, 2025:

The payout percentages are derived from historical paid-to-incurred development patterns and are weighted by incurred losses.

The reconciliation of the net incurred and paid loss information in the loss reserve rollforward table and development tables with respect to the current accident year is as follows (in millions):

The reconciliation of the net incurred and paid claims development tables to the liability for claims and claim adjustment expenses in the consolidated balance sheets is as follows (in millions):

10. Reinsurance

The Company maintains a comprehensive reinsurance program to manage risk exposure, reduce earnings volatility, and safeguard capital. By ceding a portion of its underwriting risk to highly rated reinsurers and alternative capital providers, the Company limits the financial impact of catastrophe events. Nevertheless, the Company remains ultimately responsible for policyholder claims should a reinsurer fail to perform.

The Company’s reinsurance strategy includes a mix of quota share and excess of loss (“XOL”) structures, alongside collateralized protection through catastrophe bonds. The Company works with reinsurers rated “A-” (Excellent) or better by A.M. Best, or require appropriate collateral. Contracts often include provisions allowing for replacement of reinsurers whose financial condition deteriorates.

The Company’s catastrophe reinsurance program supports property risks underwritten by us on behalf of our MGA and third-party MGAs. These risks are protected by program-specific XOL treaties, and in some cases, quota share reinsurance. In addition to the program specific covers, the Company is also protected by a corporate catastrophe cover and participation in the Florida Hurricane Catastrophe Fund (FHCF). This structure is designed to provide protection against severe loss events across the portfolio, covering up to at least a 1-in-250-year return period threshold.

For business written by the Company’s MGA, the Company has strategically retained more risk in recent periods by scaling back proportional reinsurance, reflecting the Company’s confidence in the portfolio’s underwriting performance. The Company’s MGA remains covered by standalone catastrophe XOL protection.

Additionally, the Company utilizes collateralized reinsurance through Mountain Re Ltd., a Bermuda-based special purpose insurer. The catastrophe bonds issued through Mountain Re Ltd. provide multi-year per occurrence coverage for a range of perils for business written through the Company’s MGA.

The following tables reflect amounts affecting the consolidated statements of operations and comprehensive income (loss) for reinsurance as of and for the years ended December 31, 2025, 2024 and 2023.

As of December 31, 2025 and December 31, 2024, a provision for sliding scale commissions of $36.0 million and $34.2 million, respectively, is included in provision for commission on the consolidated balance sheets. As of December 31, 2025 and December 31, 2024, a receivable for sliding scale commissions of $37.6 million and $3.6 million, respectively, is included in ceding commissions receivable on the consolidated balance sheets.

As of December 31, 2025 and December 31, 2024, a provision for loss participation features of $17.4 million and $41.6 million, respectively, was recorded as a contra-asset in reinsurance recoverable on the consolidated balance sheets. The decrease is due primarily to settlements of the Company’s 2023 and prior year’s loss participation features with the Company’s participating reinsurers.

Amounts recoverable from reinsurers are recognized in a manner consistent with the claims liabilities associated with the reinsurance placement and presented on the balance sheet as reinsurance recoverable on paid and unpaid losses and LAE. Such balance is presented in the table below.

The Company evaluates the collectability of reinsurance recoverables and records allowances for expected credit losses when necessary. As of December 31, 2025, 2024 and 2023, no material allowance was recorded.

The Company evaluates the financial condition of its reinsurers and, in certain circumstances, holds collateral in the form of funds withheld and letters of credit. This collateral serves as security under the terms of its reinsurance contracts to reduce credit exposure to reinsurance recoverable and prepaid reinsurance premium balances. The Company has the following unsecured reinsurance recoverable and prepaid reinsurance premium balances from reinsurers:

11. Geographical Breakdown of Gross Written Premium

Gross written premium by state is as follows:

12. Public Warrants and Private Placement Warrants

In November 2020, in connection with the RTPZ IPO, RTPZ issued 4.6 million warrants (the “Public Warrants”) and 4.4 million warrants (the “Private Placement Warrants” and, together with the Public Warrants, the “Public and Private Placement Warrants”) to purchase its Class A ordinary shares at $287.50 per share. Every 25 Warrants are presently exercisable for one share of the Company’s common stock at an exercise price per share of $287.50.

On September 9, 2024, the Company received notice (the “Notice”) from the New York Stock Exchange (the “NYSE”) that the Company’s warrants (the “Warrants”) are no longer suitable for listing based on “abnormally low selling price” levels, pursuant to Section 802.01D of the NYSE Listed Company Manual, and that the NYSE Regulation has determined to delist the Warrants. As such, the Warrants were determined to have no value as of December 31, 2024.

All of the Public and Private Placement Warrants were outstanding as of December 31, 2025 and 2024.

13. Commitments and Contingencies

Purchase Commitments

As of December 31, 2025, the Company has total minimum purchase commitments, which must be made during the next three years, of $5.2 million.

From time to time, the Company may be involved in litigation or other legal proceedings. The Company is routinely named in litigation involving claims from policyholders. Legal proceedings relating to claims are reserved in the normal course of business. The Company does not believe it is a party to any pending litigation or other legal proceedings that are likely to have a material adverse effect on the Company’s business, financial condition or results of operations. Regardless of outcome, litigation can have an adverse impact on the Company because of defense and settlement costs, diversion of management resources and other factors.

The Company records a liability for litigation if an unfavorable outcome is probable and the amount of loss or range of loss can be reasonably estimated. If an unfavorable outcome is probable and a reasonable estimate of the loss is a range, the Company accrues the best estimate within the range. If no amount within the range is a better estimate than any other amount, the Company accrues the minimum amount within the range. If an unfavorable outcome is probable but the amount of the loss cannot be reasonably estimated, the Company discloses the nature of the litigation and indicates that an estimate of the loss or range of loss cannot be made. If an unfavorable outcome is reasonably possible and the estimated loss is material, the Company discloses the nature and estimate of the possible loss of the litigation. The Company does not disclose information with respect to litigation where an unfavorable outcome is considered to be remote or where the estimated loss would not be material. Based on current expectations, such matters, both individually and in the aggregate, are not expected to have a material adverse effect on the Company’s liquidity, results of operations, business, or financial condition.

14. Leases

Operating Leases

The Company leases office space under non-cancelable operating leases with various expiration dates through 2027, some of which include options to extend the leases for up to 5 years. The Company does not assume renewals in the determination of the lease term unless the renewals are deemed to be reasonably certain.

For the years ended December 31, 2025 and December 31, 2024, the Company recognized $2.4 million and $3.0 million of ROU asset impairments associated with the Company’s termination of its lease space in Palo Alto, California, and abandonment of leased space used in the Company’s business operations, respectively. The Company recognized operating lease expenses of $1.7 million, $3.2 million, and $6.1 million for the years ended December 31, 2025, 2024 and 2023, respectively.

The weighted average remaining lease term and the weighted average discount rate for operating leases as of December 31, 2025 were as follows:

Maturities of operating lease liabilities by fiscal year as of December 31, 2025 are as follows:

The following table presents supplemental cash flow information about the Company’s operating leases:

15. Stockholders’ Equity

Common Stock

The Company’s common stock trades on the New York Stock Exchange (“NYSE”) under the ticker symbol “HIPO”. Pursuant to its Certificate of Incorporation, the Company is authorized to issue 80 million shares of common stock, with a par value of $0.0001 per share. Each share of common stock is entitled toone vote. The holders of the common stock are also entitled to receive dividends whenever funds are legally available and when declared by the Board of Directors. No dividends have been declared or paid since inception.

Stock-Based Compensation Plans

The Company maintains equity compensation plans adopted in 2019 and 2021 (the “plans”). The material terms of the plans were previously disclosed in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2024. There have been no material changes to the plans during the current fiscal year.

Stock Options

The following table summarizes option activity under the plans:

There wereno options granted during the years ended December 31, 2025 and 2024.

Total unrecognized compensation cost of $0.1 million as of December 31, 2025, is expected to be recognized over a weighted-average period of 0.4 years.

Restricted Stock Units and Performance Restricted Stock Units

The Company grants service based RSUs and performance based RSUs (“PRSUs”) as part of the Company’s equity compensation plans. The Company measures RSU and PRSU expense for awards granted based on the estimated fair value of those awards at the grant date. To estimate the fair value of PRSUs containing a market condition, the Company used the Monte Carlo valuation model. The fair value of all other awards is based on the closing price of the Company’s common stock as reported on the NYSE on the date of grant. The RSUs generally vest over a period oftwo tofour years. The PRSUs vest based on the level of achievement of the performance goals and continued employment with the Company over aone tofour year performance period.

During the years ended December 31, 2025, the Company granted 42,244 PRSUs to its CEO. Vesting is based on the Company’s total shareholder return (“TSR”) relative to a peer group over athree-year period. Between 0% and 100% of the target shares may vest based on performance. The awards are classified as equity and were valued on the grant date using a Monte Carlo simulation. Expense is recognized over the service period regardless of TSR outcome, provided continued employment. The weighted-average grant-date fair value was $24.08 per unit. Total compensation expense expected to be recognized over thethree-year period is $1.0 million.

Stock-based compensation expense for RSUs are recognized based on the straight-line basis over the employee requisite service period. Stock-based compensation expense for PRSUs are recognized on a graded accelerated basis over the employee requisite service period. The Company accounts for forfeitures as they occur.

The following table summarizes the RSU and PRSU activity for the year ended December 31, 2025:

Total unrecognized compensation cost related to unvested RSUs and PRSUs is $24.6 million as of December 31, 2025, and it is expected to be recognized over a weighted-average period of 1.5 years.

2021 Employee Stock Purchase Plan

The Company adopted the 2021 Employee Stock Purchase Plan (the “2021 ESPP”), which is designed to allow eligible employees of the Company to purchase shares of the Company’s common stock with their accumulated payroll deductions at a price equal to 85% of the lesser of the fair market value on the first business day of the offering period or on the designated purchase date of the offering period, up to a maximum purchase amount of $25,000 during the calendar year. The 2021 ESPP offers asix-month look-back feature as well as an automatic reset feature that provides for an offering period to be reset to a new lower-priced offering if the offering price of the new offering period is less than that of the current offering period. During the year ended December 31, 2025 and 2024,154,973 and 170,009 shares were issued under the plan, respectively. In addition, the number of shares available for issuance under the 2021 ESPP is increased annually on January 1 of each calendar year ending in 2031, by an amount equal to the lesser of (i)one percent of the shares outstanding (on a converted basis) on the last day of the immediately preceding fiscal year and (ii) such number of shares as may be determined by the board of directors.

Stock-Based Compensation

Total stock-based compensation expense, classified in the accompanying consolidated statements of operations and comprehensive income (loss), was as follows:

Share Repurchases

On October 30, 2024, the Company entered into a Share Repurchase Agreement with an existing unaffiliated shareholder to purchase 957,242 shares of the Company’s common stock at a purchase price of $16.28 per share pursuant to the Company’s share repurchase program (the “Share Repurchase”). The Share Repurchase was substantially completed on October 30, 2024. The Company used available cash resources of approximately $15.6 million to complete this transaction. As of December 31, 2024, there were no unsettled share repurchases.

On July 1, 2025, the Company repurchased 514,309 shares of its common stock, beneficially owned by Lennar Title Group, LLC and its affiliates (collectively, “Lennar”), a related party of the Company, in a private transaction at a price per share of $28.17, for an aggregate purchase price of $14.5 million. The repurchase of the shares was made under the Company’s existing share repurchase program. As of December 31, 2025, $18.1 million of common stock remains available for repurchase. Shares repurchased by the Company are accounted for when the transaction is settled. As of December 31, 2025, there were no unsettled share repurchases. Direct costs incurred to acquire the shares are included in the total cost of the shares.

16. Income Taxes

One Big Beautiful Bill Act

On July 4, 2025, the One Big Beautiful Bill Act (the "Act"), which contains significant tax-related provisions, was signed into law. These include the restoration of 100% bonus depreciation, the reinstatement of expensing for domestic research and experimentation expenditures, and changes to international tax provisions. The provisions of the Act did not have a material impact on the Company.

Income tax expense

The Company and its U.S. subsidiaries file a consolidated federal income tax return. Tax liabilities and benefits realized by the consolidated group are allocated on a separate return basis. The Company’s international subsidiaries file various income tax returns in their respective jurisdictions.

Income (loss) before tax consists of the following:

The components of the total provision for income taxes are as follows:

(1)State taxes in California contributed to the majority of the tax effect in this category

The components of the provision for income taxes are as follows:

The components of income taxes paid (net of refunds received) are as follows:

Deferred tax

Significant components of the Company’s deferred tax assets and liabilities are as follows:

Valuation allowance

Recognition of deferred tax assets is appropriate when realization of these assets is more likely than not. Based upon the weight of all available evidence, with primary focus on the Company's history of recent losses, the Company has concluded that it is not more likely than not that the recorded Federal and State deferred tax assets will be realized. As a result, the Company has recorded a full valuation allowance against its Federal and State deferred tax assets recorded as of December 31, 2025 and 2024.

Unrecognized tax benefits

The Company recognizes the tax benefit of tax positions taken in the consolidated financial statements only when it is more likely than not that the position will be sustained on examination by the relevant taxing authority based on the tax technical merits of the position. The tax benefit of a position that meets this standard is measured at the largest amount of benefit that is expected to be more likely than not to be realized on settlement. A liability is established for the difference between the tax benefit of positions taken in a tax return and the tax benefit of tax positions recognized in the consolidated financial statements.

Below is a reconciliation of unrecognized tax benefits:

The balances at December 31, 2025 and 2024 were fully offset by a valuation allowance. No interest or penalties were incurred during the years ended December 31, 2025 and 2024.

Net operating losses

As of December 31, 2025, the Company has recorded U.S. federal and state net operating loss (“NOL”) carryforwards of $718.9 million and $488.8 million, respectively. The Company has $166.0 million of Dual Consolidated Losses in a 953(d) company, RH Solutions Insurance (Cayman) Ltd. The provisions of the Tax Cuts and Jobs Act of 2017 eliminated the 20-year carryforward period and made it indefinite for federal net operating losses generated in tax years after December 31, 2017. For such amounts generated prior to 2018, the 20-year carryforward period continues to apply.

In general, a corporation’s ability to utilize its NOL carryforwards may be subject to a substantial limitation due to ownership changes that may have occurred or that could occur in the future, as required by section 382 of the Internal Revenue Code of 1986, as amended, as well as similar state provisions. These ownership changes may limit the amount of NOL and R&D credit carryforwards that can be utilized annually to offset future taxable income and tax, respectively. In general, an “ownership change,” as defined by Section 382 of the Code, results from a transaction or a series of transactions over a three-year period resulting in an ownership change of more than 50 percent of the capital (as defined) of a company by certain stockholders or public groups. The Company has performed a Section 382 analysis and experienced two historical ownership changes in 2016 and 2018, and the Company’s tax attributes subject to such limitations under section 382 have been considered. Components of the NOL carryforwards are as follows:

Tax credit carryforwards

As of December 31, 2025, the Company has U.S. federal R&D credit carryforwards of $10.7 million, which have a 20-year carryforward and expire 2038-2045, as well as state R&D credit carryforwards of $8.2 million, which have an indefinite carryforward period.

Taxing authority audits

The Company’s income tax returns are subject to federal and state tax examinations. There are no pending tax examinations as of December 31, 2025. For U.S. federal purposes, the Company is open to examination for the 2022 – 2025 tax years, and for state purposes, the Company is open from 2021 – 2025 tax years. No interest or penalties were incurred during the years ended December 31, 2025, 2024, and 2023.

17. Net Income (Loss) Per Share Attributable to Common Stockholders

Net loss per share attributable to common stockholders was computed as follows:

The potential shares of common stock that were excluded from the computation of diluted net loss per share attributable to common stockholders for the periods presented because including them would have been antidilutive are as follows:

18. Acquisitions and Dispositions

Sale of Homebuilder Distribution Network

On July 1, 2025, the Company and Westwood Insurance Agency, LLC (“Westwood”), closed on the sale of the Company’s homebuilder distribution network. Total sale consideration consists of (i) $75 million in up-front cash consideration; and (ii) $25 million in cash consideration, which was due and received in the first quarter of 2026. In connection with the closing and pursuant to an Omnibus Consent and Waiver Agreement (“Consent Agreement”) among certain subsidiaries of the Company and Lennar, a related party, the Company (i) paid Lennar $8 million in consideration for Lennar’s required consent to the Westwood Sale; and (ii) agreed to make four quarterly milestone payments of $1 million each, commencing in the fourth quarter of 2026 and concluding in the third quarter of 2027, contingent upon Lennar’s material compliance with the terms set forth in the Consent Agreement and related Westwood Sale agreements. The transaction resulted in the loss of control and deconsolidation of a subsidiary with noncontrolling interest. Accordingly, the carrying amount of the noncontrolling interest of $1.6 million was eliminated from equity. In separate agreements with Westwood, the Company entered into program agreements to continue to distribute the Company’s homeowners product through Westwood’s network of builders. The contingent consideration liability was part of the liabilities transferred in the sale of the Company’s homebuilder distribution network.

The Company determined that the sale will not constitute a strategic shift and that the impact on the Company’s overall operations and financial results is not material. Accordingly, the operations associated with the sale will not be reported in discontinued operations. The Company recorded a gain of $95.0 million to the consolidated statements of operations and comprehensive income (loss).

First Connect Divestiture

On October 29, 2024, the Company completed the sale of its independent agent platform, First Connect Insurance Services (“First Connect”) to affiliates of Centana Growth Partners (“Centana”), for which the Company received $48.0 million in cash at closing, with the opportunity to earn up to $12.0 million following the closing upon the achievement of certain revenue-based targets in 2025 and 2026. The Company retained a 19.2% ownership stake in First Connect. The Company determined that the disposition will not constitute a strategic shift and that the impact on the Company’s overall operations and financial results is not material. Accordingly, the operations associated with the disposal will not be reported in discontinued operations. During the year ended December 31, 2024, the Company recognized a total gain on the sale of First Connect of $46.1 million, including a $4.1 million valuation of the Company’s retained 19%, which is considered non-cash. The fair value of $4.1 million was estimated using the Monte Carlo Simulation method and includes assumptions and judgments regarding the risk-free rate, volatility, and expected term, which are primarily Level 3 assumptions. The contingent earn-out was not included in the calculation of the gain as we will record it when the contingency is resolved. The transaction was completed at arm’s length and Centana was not, and will not be, considered a related party of the Company.

Mainsail Disposition

On July 31, 2024, the Company completed the sale of Mainsail Insurance Company (“Mainsail”) for an aggregate price of $26.6 million to Emerald Bay Insurance Group (“Emerald Bay”). The Company determined that the disposition did not constitute a strategic shift and that the impact on the Company’s overall operations and financial results is not material. Accordingly, the operations associated with the disposal are not reported in discontinued operations. During the year ended December 31, 2024, the Company recognized a total gain on the sale of Mainsail of $8.2 million based on total cash proceeds received of $26.6 million and net assets sold of $18.4 million. The transaction was completed at arm’s length and Emerald Bay was not, and will not be, considered a related party of the Company.

Asset Acquisitions

In the fourth quarter of fiscal 2023, the Company acquiredtwo insurance agencies for purchase consideration totaling $5.9 million and consisting of $4.3 million in cash, of which $0.7 million is deferred until the first and second anniversary of the transaction date, and $1.6 million related to the fair value of the previously held interest. Both acquisitions were determined to be asset acquisitions for accounting purposes. Of the total purchase consideration, $4.8 million has been recorded to acquired intangible assets, which primarily relate to customer relationships and have a useful life ofseven years. The remaining net assets acquired consisted of $1.1 million of net working capital.

Prior to the acquisitions, the Company accounted for its ownership interest under the equity method of accounting. The acquisition of the controlling financial interest was accounted for as a step acquisition. The Company’s previously held interest was remeasured to fair value and resulted in a gain of $1.3 million. The gain was reflected in other (income) expense, net in the consolidated statements of operations and comprehensive income (loss).

Acquisition of noncontrolling interests in subsidiaries

In the fourth quarter of 2023, the Company purchased all of the noncontrolling interest in two insurance agencies for $3.2 million in cash. In connection therewith, the Company recognized a $2.7 million adjustment to equity for the difference between the $3.2 million of cash consideration allocated to the noncontrolling interest and its $0.5 million carrying value. The Company had previously consolidated these agencies as they were Variable Interest Entities (“VIEs”) and the Company was the primary beneficiary.

19. Segments

Historically, the Company reported its financial results in the following three reportable segments: Services, Insurance-as-a-Service, and Hippo Home Insurance Program, which was reflective of how the Company’s CODM reviewed financial information for purposes of making operating decisions, assessing financial performance and allocating resources. Because of organizational changes and how the CODM views the business, beginning in the third quarter of 2025, the Company changed from three operating and reportable segments toone operating and reportable segment, the property and casualty insurance business. The property and casualty insurance business generates revenues primarily from net earned premiums, commission income, and net investment income.

The CODM is the Company’s Chief Executive Officer. The significant segment expenses provided to the CODM are consistent with the categories shown in the Company’s consolidated statements of operations and comprehensive income (loss) and there are no other segment expenses at a more disaggregated level used by the CODM. The CODM reviews the Company’s net income (loss) as reported under GAAP, which is the primary measure of segment profit and loss. The CODM reviews this measure to monitor budget versus actual results and in competitive analysis by benchmarking to the Company’s competitors. The budgeted versus actual results analysis along with the competitive analysis are used to make resource allocation decisions. While the Company’s CODM also reviews the revenue streams attributable to individual lines of business, operations are managed, resources are allocated, and financial performance is evaluated on a consolidated basis. The measure of segment assets is reported on the balance sheet as total consolidated assets.

Prior period segment results and related disclosures have been recast to conform to the current period segment presentation.

20. Statutory Financial Information

The Company’s insurance subsidiaries are subject to insurance laws and regulations in the jurisdictions in which they operate. U.S. state insurance laws and regulations prescribe accounting practices for determining statutory net income and capital and surplus for insurance companies. In addition, state regulators may permit statutory accounting practices (SAP) that differ from prescribed practices. The principal differences between SAP and GAAP as they relate to the financial statements of the Company’s insurance subsidiaries are (a) policy acquisition costs are expensed as incurred under SAP, whereas they are deferred and amortized under GAAP, (b) certain assets are not admitted for purposes of determining surplus under SAP, (c) investments in fixed income securities are carried at amortized cost under SAP whereas such securities are carried at fair value under GAAP, and (d) the criteria for recognizing net DTAs and the methodologies used to determine such amounts are different under SAP and GAAP.

Risk-Based Capital (“RBC”) requirements promulgated by the National Association of Insurance Commissioners require property/casualty insurers to maintain minimum capitalization levels determined based on formulas incorporating various business risks of the insurance subsidiaries. As of December 31, 2025 and 2024, the Company’s insurance subsidiaries capital and surplus exceeded its authorized control level.

The statutory net income and statutory capital and surplus of the Company’s insurance subsidiaries in accordance with regulatory accounting practices were as follows:

21. Dividend Restrictions

Spinnaker Insurance Company

The maximum amount of dividends that can be paid by all property and casualty insurance companies within the group without prior approval of their respective insurance commissioner in a 12 month period, measured retrospectively from the date of payment, is $29.9 million, $34.5 million and $26.3 million for years ended December 31, 2025, 2024, and 2023, respectively.

RH Solutions Insurance (Cayman) Ltd.

The Company’s insurance subsidiary in the Cayman Islands, RHS, is regulated by the Cayman Islands Monetary Authority (“CIMA”). CIMA must be given advanced notice of any dividend payments. At December 31, 2025, 2024, and 2023 approximately $33.5 million, $32.3 million, and $18.4 million, respectively, of excess capital were available for the payment of dividends contingent on receiving the prior approval of CIMA. Dividend distributions to RH Solutions’ stakeholders are recognized in the period in which the dividends are declared. In accordance with the terms of the Insurance (Capital and Solvency) (Class B, C, and D Insurers) Regulations, 2012, as a Class B(iii) insurer under the Law, RHS is required to maintain the Prescribed Capital Requirement (“PCR”) of $11.5 million, which is based on net earned premium during the fiscal year.