Porch Group, Inc. (PRCH) Business

Item 1. Business

Company Overview

Introduction to Porch

Porch Group, Inc., together with its consolidated subsidiaries, (“Porch,” the “Company,” “we,” “our,” “us”) is a new kind of homeowners insurance company—one designed to stand out in a massive and growing market of more than $100 billion. Our strategy is built on three differentiators that set us apart.

1.Advantaged Underwriting Through Proprietary Data

Leveraging unique property insights, we can assess risk with greater precision, enabling competitive pricing for low-risk customers and avoiding high-risk customers, while delivering superior underwriting performance.

2.Best Services for Homebuyers

We are committed to being the go-to partner during one of life’s most significant transitions—buying a home—by offering services that simplify moving and home setup.

3.More Protection

We combine homeowners insurance with home warranty, filling coverage gaps and reducing unexpected costs for consumers.

In January 2025, we completed the formation of Porch Reciprocal Exchange (the “Reciprocal”) and, as part of this process, sold our legacy homeowners insurance carrier, Homeowners of America (“HOA”), to the Reciprocal. Following the sale, HOA became a wholly owned subsidiary of the Reciprocal. Porch continues to manage and operate the Reciprocal, providing critical services such as underwriting, policy renewal, risk and portfolio management, financial oversight, and investment guideline setting. In return, Porch earns commissions and fees for these services.

Beyond insurance, Porch is a leader in the home software-as-a-service (“SaaS”) space, serving approximately 24 thousand companies across industries essential to the home-buying process—home inspectors, title companies, mortgage providers, and more. Our deep relationships and proprietary data give us unique visibility into approximately 90% of U.S. homes, enabling superior risk assessment and competitive pricing.

Our mission is to be the best homeowners insurance partner for homebuyers, offering more than just coverage. Through the Porch app, we provide a full moving concierge service, helping customers with moving logistics and essential home services like security, TV/Internet setup, and more.

Finally, we deliver greater home protection by pairing homeowners insurance with full home warranty, additional coverages, and appliance recall monitoring. This approach fills coverage gaps, reduces unexpected costs, and strengthens our value proposition—creating deeper, lasting relationships with our customers.

Beginning in January 2025, we operate under four reportable segments that are also our operating segments. Three of these segments are owned by Porch — Insurance Services, Software & Data, and Consumer Services. We collectively call these three segments, along with corporate functions, the “Porch Shareholder Interest.” Our fourth segment, the Reciprocal Segment, is managed, but not owned, by Porch and, at this time, is consolidated for reporting purposes.

Insurance Services Segment

Our Insurance Services segment earns management fees from the Reciprocal in exchange for managing and operating its business. This segment also receives policy fees from policyholders, lead fees from agencies, earns interest on surplus

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notes from the Reciprocal, and includes a captive reinsurer to provide reinsurance support to improve capital efficiency for the Reciprocal.

Software & Data Segment

Software

We provide software, on a subscription and predominantly transactional basis, to inspection, mortgage, title, and roofing companies. This segment includes the Inspection Support Network (“ISN”) collection of brands, which are leading SaaS solutions for inspectors with easy-to-use tools. ISN brands provide a range of offerings for inspection businesses, and together represent roughly half of all U.S. home inspections in 2025. Rynoh software helps settlement agents protect the real estate transaction. Rynoh software was utilized in approximately 40% of all real estate closings in 2025. Floify is a software company helping mortgage companies and loan officers create a better mortgage and refinancing experience for consumers. iRoofing provides measurement software for roofers.

Data

Porch Group Media is a leading provider of data solutions, including Home Factors, our unique property insights product. With insights into approximately 90% of U.S. homes, Home Factors provides interior and exterior attributes and condition data to help insurance carriers improve underwriting, pricing, and risk selection. Beyond insurance, Home Factor property insights are utilized in other business areas to enhance customer acquisition and retention efforts.

Consumer Services Segment

Our Consumer Services segment provides warranty products through Porch Warranty and other warranty brands to protect the whole home. Our Consumer Services segment also provides moving related services such as movers, TV/Internet, and security.

Warranty

Our warranty business offers various products such as whole-home, service line, and extended labor warranties in 50 states and Washington, D.C. The warranty business typically acquires customers through direct-to-consumer marketing and partnerships, including real estate, home inspection, distributors, utilities, and home insurance.

Moving Services

Porch Moving Group includes the MovingPlace, HireAHelper, SML, and Moving Staffers brands, and is primarily a marketplace offering labor-only moving services which has recently expanded to offer full-service moving services.

Reciprocal Segment

The Reciprocal Segment includes HOA and its parent, the Reciprocal, which is a member-owned reciprocal exchange, owned by policyholder members rather than Porch. The Reciprocal Segment provides policyholders with insurance to protect their homes, earning revenue primarily through premiums collected on policies.

The Reciprocal offers property-related insurance products in 20 states. The Reciprocal uses Home Factors and other data points to better assess homes, underwrite risk, and effectively price homeowners insurance policies, with pricing advantages for well-maintained homes and pricing surcharges for homes that are higher risk.

Property insurance claims fluctuate with seasonal weather; the highest exposure to catastrophic weather for the Reciprocal has historically occurred in the first half of the year. While the Reciprocal retains insurance underwriting risk, a portion of the risk is ceded to third-party reinsurance companies.

Core Differentiation

There are three key areas where Porch has differentiation which is core to the strategy - we provide advantaged underwriting, best services for homebuyers, and more home protection:

Advantaged Underwriting

With insights into approximately 90% of U.S. homes, we are able to better model underwriting risk and price policies appropriately. This is a win-win, as it benefits us and our customers.

Our unique property data from Home Factors enhances our underwriting models and, where applicable, helps create a pricing advantage for well-maintained homes and prevent adverse selection for poorly maintained homes.

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This data has enabled us to more accurately underwrite risk, and as a result, we have seen an improvement in the Reciprocal’s Attritional Loss Ratio (see Non-GAAP Financial Measures in Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations for definition), which was 17% and 22% for the years ended December 31, 2025, and 2024, respectively.

Best Services for Homebuyers

We know when homebuyers are moving approximately six weeks before they move due to our unique early insight. Therefore, we have the ability to cross-sell a variety of products at the time they are most needed. The consumer will engage with either the Porch app or our concierge service to receive support in various aspects of their move, such as insurance, warranty, and moving services, utilities, TV/Internet, and security, including comparing reviews and prices for different providers.

More Protection

We provide consumers with more protection through offering home insurance, home warranty for everyday breakdowns, and a home app to provide appliance recall check monitoring. We can be there from move-in to move-out, with a variety of products designed to make sure our customers’ largest assets are protected.

Industry Trends

In 2025, 4.1 million1 existing homes and 0.7 million2 newly constructed homes were sold in the U.S. We have relationships with approximately 24 thousand companies that support consumers through the home transaction. In 2025, the U.S. housing market began to stabilize despite increases in interest rates and rising home sales prices, with industry home sales remaining relatively unchanged from 2024.

We primarily focus on homebuyers, where we have unique competitive advantages due to our data insights with this pool of customers. We consider this a higher quality customer cohort because it typically has a long lifetime value.

The home services industry is highly competitive, fragmented, and localized. We compete with, among others: (i) large insurance carriers (ii) vertical software companies in our markets, (iii) companies who provide or help consumers purchase homeowners insurance, home warranty, moving, and other home services, (iv) search engines or online marketplaces for all types of home services with which we assist consumers, (v) property and mover data companies, and (vi) other companies which help consumers to make managing and maintaining their homes simple. We believe that our largest competition comes from the wide variety of companies focused on reaching consumers to help with key high-value services such as insurance.

Strategic Growth Pillars

Following a chapter focused on reaching profitability, we now enter a chapter focused on profitable growth. Our goal is to positively impact long-term shareholder value by focusing on the following strategic growth pillars:

Scale Insurance Premiums

Our strategy continues to focus on profitable growth. This includes expanding our offering within our existing states and into new states, and recruiting a high performing sales team who will increase our quote volumes and therefore insurance gross written premiums by expanding the number of third-party insurance agency relationships and building deeper relationships with existing third-party insurance agencies.

Software Innovation to SaaS Businesses

We plan to continue increasing utilization of our SaaS products and maintain high customer retention. We expect to launch new products and features to meet the needs of our customers, while increasing prices and maintaining high customer retention rates.

1 National Association of Realtors, Existing Home Sales, December 2025

2 U.S. Census Bureau, Monthly New Residential Sales, October 2025

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Growth of Data Business

We intend to add new categories of Home Factors, our property insights product, each quarter and further monetize Home Factors with third parties.

Expand Access to Consumers

By leveraging existing partnerships with moving companies, major utilities, and other partnerships, we are expanding access to high-value homebuyers early in their journey, and fostering long-term customer relationships.

Government Regulation

Reciprocal

State Regulation

The Reciprocal Segment is subject to regulation, primarily at the state level. The method, extent, and substance of such regulation varies by state but generally has its source in National Association of Insurance Commissioners (“NAIC”) model laws and regulations that establish standards and requirements for conducting the business of insurance and may be adopted by each state regulatory agency.

The NAIC Accreditation Program requires state regulatory agencies to meet baseline standards of solvency regulation of insurers, particularly with respect to regulation of multi-state insurers. In general, such regulation is intended for the protection of those who purchase or use insurance products, and not, in the case of the Reciprocal, its operator. These rules have a substantial effect on the Reciprocal’s business and relate to a wide variety of matters including: insurance company licensing and examination; the licensing of insurance agents and adjusters; price setting or premium rates; underwriting rules and restrictions; trade practices; approval of policy forms; claims practices; restrictions on transactions between our subsidiaries and their affiliates, including the payment of dividends and management fees, which are subject to regulatory review and reasonableness standards and may be limited, modified or disallowed by state insurance regulators; investments; underwriting standards; advertising and marketing practices; capital adequacy; and the collection, remittance and reporting of certain taxes, licenses and fees.

Insurance Holding Company Regulation

Most states have enacted legislation that regulates insurance holding company systems, defined as two or more affiliated persons, one or more of which is an insurer. The Reciprocal and Porch, and their wholly owned subsidiaries, meet the definition of an insurance holding company system.

Under the insurance holding company laws and regulations adopted in Texas, the Reciprocal is required to register with the Texas Department of Insurance (the “Texas Department”) and furnish information concerning the operations of companies within the holding company system that includes Porch and all of its subsidiaries. Under these laws and regulations, the Reciprocal is required to disclose material transactions with other companies in the holding company system and give prior notice of or obtain approval for certain transactions. All transactions within a holding company system affecting an insurer must have fair and reasonable terms and are subject to other standards and requirements established by law and regulation. The Texas Department also may require the Reciprocal to produce records, books, or other information papers of or concerning Porch that are in its possession and are necessary to ascertain the financial condition or legality of conduct of the Reciprocal, including the enterprise risk to the insurer by Porch or by any entity or combination of entities within the insurance holding company system, or by the insurance holding company system on a consolidated basis.

Financial Solvency Ratios

The NAIC annually calculates 13 financial ratios to assist state insurance regulators in monitoring the financial condition of insurance companies. A “usual range” of results for each of these ratios is used by insurance regulators as a benchmark. Departure from the usual range on four or more of the ratios could lead to inquiries from individual state insurance departments as to certain aspects of a company's business. In addition to the financial ratios, states also require the calculation of a minimum capital requirement for each of our insurance companies based on individual company insurance risk factors. These “risk-based capital” results are used by state insurance regulators to identify companies that require regulatory attention or the initiation of regulatory action.

Restrictions on Shareholder Dividends

The insurance carrier’s capacity to pay dividends to shareholders is limited. Insurance companies must provide advance informational notice to the domicile state insurance regulatory authority prior to payment of any dividend or distribution to its shareholders. Prior approval from the state insurance regulatory authority must be obtained before payment of an

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“extraordinary dividend” as defined under the state's insurance code. The amount of ordinary dividends that may be paid is subject to certain limitations, the amounts of which change each year. These limitations only apply to shareholder dividends paid by the Reciprocal’s subsidiaries. The Reciprocal, operating as a reciprocal insurance exchange, does not pay shareholder dividends. The Reciprocal is owned by policyholder members rather than Porch. We do not anticipate dividends being paid to policyholders in the near term.

Price Regulation

Nearly all states have insurance laws requiring the Reciprocal to file rate schedules, policy or coverage forms, and other information within the state's regulatory authority. In certain states, rate schedules, policy forms, or both, must be approved prior to use. While insurance laws vary from state to state, their objectives are generally the same: an insurance rate cannot be excessive, inadequate, or unfairly discriminatory. The speed with which we can change our rates in response to competition or in response to increasing costs depends, in part, on the willingness of state regulators to allow adequate rates for the business we write.

Insurance Reserves

State insurance laws require the Reciprocal to analyze the adequacy of its reserves annually. Its appointed actuaries must submit an opinion that the Reciprocal’s statutory reserves are adequate to meet policy claims-paying obligations and related expenses.

Exiting Geographic Markets; Canceling and Non-Renewing Policies

Most states regulate the insurance carrier’s ability to exit a market. For example, states limit, to varying degrees, the Reciprocal’s ability to cancel and non-renew insurance policies. Some states prohibit withdrawing one or more types of insurance business from the state, except upon prior regulatory approval. Regulations that limit policy cancellation and non-renewal may restrict the Reciprocal’s ability to exit unprofitable markets.

Investment Regulation

The Reciprocal is subject to various state regulations requiring investment portfolio diversification and limiting the concentration of investments it may maintain in certain asset categories. Failure to comply with these regulations leads to the treatment of nonconforming investments as non-admitted assets for purposes of measuring statutory surplus. Further, in some instances, state regulations require the sale of certain nonconforming investments.

Insurance Guaranty Associations

Each state has insurance guaranty association laws. Membership in a state's insurance guaranty association is generally mandatory for insurers wishing to do business in that state. Under these laws, associations may assess their members for certain obligations that insolvent insurance companies have incurred with regard to their policyholders and claimants.

Typically, states assess each solvent association member with an amount related to that member's proportionate share of business written by all association members within the state. Most state guaranty associations allow solvent insurers to recoup the assessments they are charged through future rate increases, surcharges or premium tax credits. However, there is no assurance that we will ultimately recover these assessments. We cannot predict the amount and timing of any future assessments or refunds under these laws.

Shared Market and Joint Underwriting Plans

State insurance regulations often require insurers to participate in assigned risk plans, reinsurance facilities and joint underwriting associations. These are mechanisms that generally provide applicants with various types of basic insurance coverage that may not otherwise be available to them through voluntary markets. Such mechanisms are most commonly instituted for automobile and workers' compensation insurance, but many states also mandate participation in Fair Access to Insurance Requirements Plans or Windstorm Plans, which provide basic property coverage. Participation is based upon the amount of a company's voluntary market share in a particular state for the classes of insurance involved. Policies written through these mechanisms may require different underwriting standards and may pose greater risk than those written through our voluntary application process.

Statutory Accounting Principles

The Reciprocal’s assets, liabilities and results of operation are included in the consolidated financial statements of Porch and were prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). In addition, the Reciprocal is required to calculate and report assets, liabilities and net income and other data according to Texas law and statutory accounting rules as defined in the NAIC Accounting Practices and Procedures Manual. This data is used by the Texas Department and other state insurance regulators as the primary tool for evaluating the Reciprocal’s financial condition and its compliance with state solvency standards. While not a substitute for any GAAP measure of performance, statutory data

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frequently is used by industry analysts and other recognized reporting sources to facilitate comparisons of the performance of insurance companies.

Federal Regulation

Although the federal government and its regulatory agencies generally do not directly regulate the business of insurance, federal initiatives and legislation often have an impact on our business. These initiatives and legislation include tort reform proposals, proposals addressing natural catastrophe exposures, terrorism risk mechanisms, federal financial services reforms, various tax proposals affecting insurance companies, and possible regulatory limitations, impositions and restrictions arising from the Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank”).

General

We are subject to laws and regulations that affect companies conducting business on the Internet generally and through mobile applications, including laws relating to the liability of providers of online services for their operations and the activities of users. As a result, we could be subject to claims based on negligence, unfair business practices, various torts and trademark and copyright infringement, among other actions.

As we receive, transmit, store and use a substantial amount of information received from or generated by consumers and service professionals, we are impacted by state laws and regulations governing privacy, the storage, sharing, use, processing, disclosure and protection of personal data and data breaches. These regulations are often complex and subject to varying interpretations, in many cases due to their lack of specificity, and, as a result, their application in practice may change or develop over time through judicial decisions or as new guidance or interpretations are provided by regulatory and governing bodies, such as federal, state and local administrative agencies. As such, compliance with these regulations may require significant operational changes, increased costs, and ongoing monitoring. Failure, or perceived failure, to comply with applicable data privacy and data protection requirements could result in regulatory investigations, enforcement actions, fines, litigation, reputational harm, or restrictions on our ability to collect or use data, which could adversely affect our business, financial condition, and results of operations.

We are subject to laws governing marketing and advertising activities conducted by/through telephone, e-mail, mobile devices and the Internet, including the Telephone Consumer Protection Act of 1991 (“TCPA”), the Telemarketing Sales Rule (“TSR”), the CAN-SPAM Act, Section 5 of the Federal Trade Commission Act and similar state laws, as well as federal, state, and local laws and agency guidelines governing background screening.

We are also subject to certain laws and regulations with regard to the real estate settlement process, including the Real Estate Settlement Procedures Act regulated by the Consumer Financial Protection Bureau, which, among other matters, prohibits certain practices, such as kickbacks, referrals, and unearned fees for the referral of real estate settlement services.

Furthermore, our moving services business is subject to various federal, state and local agencies that exercise broad regulatory powers over the moving industry, generally governing such activities as operations of and authorization to engage in transportation, insurance requirements, and licensing.

Additionally, as we expand into the insurance business, which is highly regulated, we must comply with and maintain various licenses and approvals with individual state departments of insurance, and we are subject to state governmental regulation and supervision.

Human Capital Management

By staying true to our core values (No Jerks/No Egos; Solve Each Problem; Be Ambitious; Care Deeply; and Together We Win), we have created a company where good people can do great work and drive shareholder value. These values guide us in everything we do, from individual everyday tasks to high-level strategic planning. They foster a culture of dialogue, collaboration, and recognition that contributes to our long-term success.

We are organized in a decentralized operating model, which allows our businesses to move quickly and leverage a common playbook, data platform, and infrastructure. When we acquire a company, our decentralized operating model helps us maintain momentum and entrepreneurial culture while mitigating the risks associated with integration. In most cases, we integrate acquisitions into our (1) central data platform; (2) transactional monetization to drive our business-to-business-to-consumer revenues such as insurance and warranty; and (3) operational systems, such as accounting and payroll.

We engage and empower our team with continued career and learning and development opportunities. We employ a continuous improvement philosophy, dive deep into the details to solve each problem, welcome collaboration, and believe the speed with which we move is a differentiator. This approach helps us build a strong bench of leaders for tomorrow’s business challenges.

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We are an organization that cares deeply and values environmental, social, and corporate governance (“ESG”) initiatives. Our ESG initiatives are rooted in our goals to be a profitable, resilient business, and to create long-term value for our stockholders, customers, employees, and communities. Our ESG strategy reflects the relevant issues that are most important to Porch and our stakeholders. We released our third ESG report in December 2025.

We pride ourselves on our values-driven culture that fosters employee engagement and creates an attractive home for top talent. We were certified as a Great Place to Work 2025, the fourth time in as many years.

As of December 31, 2025, we had a total of 803 employees, which includes 799 full-time employees. We also utilize independent contractors in the U.S. and other countries. We believe that we generally have good relationships with our employees and contractors.

Available Information

Our main consumer website is www.porch.com, and our corporate and investor relations website is located at www.porchgroup.com. You may access our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 with the Securities and Exchange Commission (the “SEC”) free of charge at www.porchgroup.com as soon as reasonably practicable after such material is electronically filed with, or furnished to, the SEC. Neither the information on these websites, nor the information on the websites of any of our brands and businesses, is incorporated by reference into this Annual Report, any other filings with, or any other information furnished or submitted to, the SEC. The SEC maintains an internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC at http://www.sec.gov.