# Exzeo Group, Inc. (XZO) Informational only - not investment advice. CIK: 0001873951 SIC: 7372 Services-Prepackaged Software SIC breadcrumb: [Services](/division/I/) > [Business Services](/major-group/73/) > [SIC 7372 Services-Prepackaged Software](/industry/7372/) Latest 10-K filed: 2026-02-26 SEC page: https://www.sec.gov/edgar/browse/?CIK=1873951 Filing source: https://www.sec.gov/Archives/edgar/data/1873951/000119312526076686/xzo-20251231.htm ## Selected Fundamentals | Metric | Value | Unit | FY | Filed | | --- | ---: | --- | ---: | --- | | Revenue | 216980000 | USD | 2025 | 2026-02-26 | | Net income | 82749000 | USD | 2025 | 2026-02-26 | | Assets | 347734000 | USD | 2025 | 2026-02-26 | ## Financials Annual standardized facts from SEC companyfacts as of latest extracted filing date 2026-02-26. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001873951.json. Derived margins, ratios, and free cash flow are computed from the extracted annual SEC facts. | Metric | 2023 | 2024 | 2025 | | --- | ---: | ---: | ---: | | Revenue | 88,333,000 | 133,948,000 | 216,980,000 | | Net income | 21,462,000 | 45,321,000 | 82,749,000 | | Operating income | 2,554,000 | 38,017,000 | 105,990,000 | | Gross profit | 17,272,000 | 53,209,000 | 131,023,000 | | Diluted EPS | 0.15 | 0.44 | 0.99 | | Operating cash flow | 10,153,000 | 49,266,000 | 100,298,000 | | Capital expenditures | 3,247,000 | 3,334,000 | 2,844,000 | | Share buybacks | 352,000 | 481,000 | 1,490,000 | | Assets | | 89,441,000 | 347,734,000 | | Liabilities | | 73,934,000 | 93,578,000 | | Stockholders' equity | | 15,507,000 | 254,156,000 | | Cash and cash equivalents | | 54,502,000 | 305,372,000 | | Free cash flow | 6,906,000 | 45,932,000 | 97,454,000 | ### Ratios ROE and ROA use period-end equity/assets. Liabilities / equity uses total liabilities divided by stockholders' equity. Current ratio uses current assets divided by current liabilities when both are reported. | Metric | 2023 | 2024 | 2025 | | --- | ---: | ---: | ---: | | Net margin | 24.30% | 33.83% | 38.14% | | Operating margin | 2.89% | 28.38% | 48.85% | | Return on equity | | 292.26% | 32.56% | | Return on assets | | 50.67% | 23.80% | | Liabilities / equity | | 4.77 | 0.37 | | Current ratio | | 1.19 | 3.86 | ## Quarterly Quarterly standardized facts from SEC companyfacts as of latest extracted filing date 2026-05-07. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001873951.json. Flow metrics use discrete quarter-length periods from 10-Q/10-Q/A filings. Q4 revenue and net income are derived only when annual FY and nine-month YTD facts exist for the same fiscal year; derived Q4 values are labeled. EPS Q4 is not derived. | Quarter | End date | Revenue | Net income | Diluted EPS | Method | | --- | --- | ---: | ---: | ---: | --- | | 2025-Q3 | 2025-09-30 | 55,166,000 | 21,151,000 | 0.25 | reported discrete quarter | | 2025-Q4 | 2025-12-31 | 53,316,000 | 21,984,000 | | derived Q4 = FY annual - nine-month YTD | | 2026-Q1 | 2026-03-31 | 55,534,000 | 20,406,000 | 0.22 | reported discrete quarter | ## Macro Cross-References - [CPIAUCSL](/indicator/CPIAUCSL/): Consumer Price Index for All Urban Consumers: All Items in U.S. City Average - [UNRATE](/indicator/UNRATE/): Unemployment Rate - [FEDFUNDS](/indicator/FEDFUNDS/): Federal Funds Effective Rate - [CES0500000003](/indicator/CES0500000003/): Average Hourly Earnings of All Employees, Total Private - [DFEDTARU](/indicator/DFEDTARU/): Federal Funds Target Range - Upper Limit - [DFEDTARL](/indicator/DFEDTARL/): Federal Funds Target Range - Lower Limit - [DGS3MO](/indicator/DGS3MO/): Market Yield on U.S. Treasury Securities at 3-Month Constant Maturity - [DGS2](/indicator/DGS2/): Market Yield on U.S. Treasury Securities at 2-Year Constant Maturity - [DGS10](/indicator/DGS10/): Market Yield on U.S. Treasury Securities at 10-Year Constant Maturity - [DGS30](/indicator/DGS30/): Market Yield on U.S. Treasury Securities at 30-Year Constant Maturity - [T10Y2Y](/indicator/T10Y2Y/): 10-Year Treasury Constant Maturity Minus 2-Year Treasury Constant Maturity - [CPILFESL](/indicator/CPILFESL/): Consumer Price Index for All Urban Consumers: All Items Less Food and Energy - [CPIUFDSL](/indicator/CPIUFDSL/): Consumer Price Index for All Urban Consumers: Food - [CPIENGSL](/indicator/CPIENGSL/): Consumer Price Index for All Urban Consumers: Energy - [CUSR0000SAH1](/indicator/CUSR0000SAH1/): Consumer Price Index for All Urban Consumers: Shelter - [PCEPI](/indicator/PCEPI/): Personal Consumption Expenditures: Chain-type Price Index - [PCEPILFE](/indicator/PCEPILFE/): Personal Consumption Expenditures Excluding Food and Energy: Chain-type Price Index - [PPIACO](/indicator/PPIACO/): Producer Price Index by Commodity: All Commodities - [T10YIE](/indicator/T10YIE/): 10-Year Breakeven Inflation Rate - [U6RATE](/indicator/U6RATE/): Total Unemployed, Plus All Marginally Attached Workers Plus Total Employed Part Time for Economic Reasons - [PAYEMS](/indicator/PAYEMS/): All Employees, Total Nonfarm - [CIVPART](/indicator/CIVPART/): Labor Force Participation Rate - [EMRATIO](/indicator/EMRATIO/): Employment-Population Ratio - [UNEMPLOY](/indicator/UNEMPLOY/): Unemployed - [CE16OV](/indicator/CE16OV/): Employment Level - [ICSA](/indicator/ICSA/): Initial Claims - [JTSJOL](/indicator/JTSJOL/): Job Openings: Total Nonfarm - [JTSQUR](/indicator/JTSQUR/): Quits: Total Nonfarm - [GDPC1](/indicator/GDPC1/): Real Gross Domestic Product - [A191RL1Q225SBEA](/indicator/A191RL1Q225SBEA/): Real Gross Domestic Product: Percent Change from Preceding Period - [INDPRO](/indicator/INDPRO/): Industrial Production: Total Index - [TCU](/indicator/TCU/): Capacity Utilization: Total Index - [HOUST](/indicator/HOUST/): New Privately-Owned Housing Units Started: Total Units - [PERMIT](/indicator/PERMIT/): New Privately-Owned Housing Units Authorized in Permit-Issuing Places: Total Units - [RSAFS](/indicator/RSAFS/): Advance Retail Sales: Retail Trade - [PCE](/indicator/PCE/): Personal Consumption Expenditures - [DSPIC96](/indicator/DSPIC96/): Real Disposable Personal Income - [PSAVERT](/indicator/PSAVERT/): Personal Saving Rate - [M2SL](/indicator/M2SL/): M2 - [BOPGSTB](/indicator/BOPGSTB/): U.S. International Trade in Goods and Services: Balance - [MSPUS](/indicator/MSPUS/): Median Sales Price of Houses Sold for the United States - [HSN1F](/indicator/HSN1F/): New One Family Houses Sold: United States - [RHORUSQ156N](/indicator/RHORUSQ156N/): Homeownership Rate in the United States - [TTLCONS](/indicator/TTLCONS/): Total Construction Spending: Total Construction in the United States - [RRVRUSQ156N](/indicator/RRVRUSQ156N/): Rental Vacancy Rate in the United States - [TOTALSL](/indicator/TOTALSL/): Total Consumer Credit Owned and Securitized - [REVOLSL](/indicator/REVOLSL/): Revolving Consumer Credit Owned and Securitized - [DRCCLACBS](/indicator/DRCCLACBS/): Delinquency Rate on Credit Card Loans, All Commercial Banks - [GDP](/indicator/GDP/): Gross Domestic Product - [GPDI](/indicator/GPDI/): Gross Private Domestic Investment - [GCE](/indicator/GCE/): Government Consumption Expenditures and Gross Investment - [PCEC](/indicator/PCEC/): Personal Consumption Expenditures - [NETEXP](/indicator/NETEXP/): Net Exports of Goods and Services - [GFDEBTN](/indicator/GFDEBTN/): Federal Debt: Total Public Debt - [GFDEGDQ188S](/indicator/GFDEGDQ188S/): Federal Debt: Total Public Debt as Percent of Gross Domestic Product - [FYFSD](/indicator/FYFSD/): Federal Surplus or Deficit - [FGRECPT](/indicator/FGRECPT/): Federal Government Current Receipts - [FGEXPND](/indicator/FGEXPND/): Federal Government: Current Expenditures - [MANEMP](/indicator/MANEMP/): All Employees, Manufacturing - [USCONS](/indicator/USCONS/): All Employees, Construction - [USTRADE](/indicator/USTRADE/): All Employees, Retail Trade - [USFIRE](/indicator/USFIRE/): All Employees, Financial Activities - [USGOVT](/indicator/USGOVT/): All Employees, Government - [AWHAETP](/indicator/AWHAETP/): Average Weekly Hours of All Employees, Total Private - [DGORDER](/indicator/DGORDER/): Manufacturers' New Orders: Durable Goods - [NEWORDER](/indicator/NEWORDER/): Manufacturers' New Orders: Nondefense Capital Goods Excluding Aircraft - [BUSINV](/indicator/BUSINV/): Total Business Inventories - [EXPGS](/indicator/EXPGS/): Exports of Goods and Services - [IMPGS](/indicator/IMPGS/): Imports of Goods and Services - [IR](/indicator/IR/): Import Price Index (End Use): All Commodities - [PPIFIS](/indicator/PPIFIS/): Producer Price Index by Commodity: Final Demand ## Latest quarter (10-Q) Latest 10-Q source: https://www.sec.gov/Archives/edgar/data/1873951/000119312526211961/xzo-20260331.htm Extracted structurally from real Item 2 body heading to real Item 3/4 boundary. Confidence: high Filing date: 2026-05-07 Report date: 2026-03-31 Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations. The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our unaudited interim Consolidated Financial Statements and the related notes included elsewhere in this Quarterly Report on Form 10-Q ("Quarterly Report") and in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025 filed with the SEC on February 26, 2026 ("2025 Annual Report"). This section is intended to provide management’s perspective on our financial performance, material events, trends, and uncertainties that may affect our business, financial condition, results of operations, and cash flows. Special Note Regarding Forward-Looking Statements This Quarterly Report contains forward-looking statements within the meaning of the federal securities laws. All statements contained in this Quarterly Report, other than statements of historical fact, including statements regarding our future results of operations, financial position, market opportunity, business strategy, plans, objectives, and factors affecting our performance are forward-looking statements. In some cases, forward-looking statements can be identified by words such as "may," "will," "should," "expect," "plan," "anticipate," "could," "intend," "target," "project," "contemplate," "believe," "estimate," "predict," "potential," or "continue" or the negative of these terms or other similar expressions. These forward-looking statements are based on management's current expectations, assumptions, estimates and projections. While we believe these expectations and assumptions are based on reasonable information, forward-looking statements are inherently predictive in nature and involve known and unknown risks and uncertainties, many of which are beyond our control. Actual results, performance, or achievements may differ materially from those expressed or implied by these forward-looking statements as a result of various factors, including those discussed or referenced in Part II, Item 1A "Risk Factors" in this Quarterly Report and in other reports we file with the SEC. Factors that could cause actual results or events to differ materially include, among others, our ability to maintain profitability and manage fluctuations in operating results on a quarterly or annual basis; our dependence on a limited number of customers for a substantial portion of our revenue; our ability to retain existing customers and attract new customers; and our continued reliance on affiliated customers. Our future performance also depends on the successful development, enhancement, and scalability of our proprietary IaaS platform, including the introduction of new features, analytical models, and services, as well as the accuracy of estimates regarding market size and growth opportunities. In addition, we operate in a highly competitive and regulated environment. Competitive pressures, consolidation within the insurance industry, regulatory scrutiny of delegated authority and claims administration functions, and evolving data privacy and cybersecurity requirements could adversely affect our business, financial condition, and results of operations. Natural catastrophes, environmental risks, and climate-related events may significantly impact our customers’ P&C insurance operations, which could in turn affect demand for our products and services. Our business also depends on the reliability and security of our information systems and third-party cloud infrastructure, and any system failures, security breaches, or unauthorized disclosures of sensitive data could result in operational disruptions, regulatory action, litigation or reputational harm. Our ownership structure further presents additional risks. HCI controls the direction of our business through its ownership interests, and this concentrated ownership limits the ability of other shareholders to influence significant corporate decisions. Potential conflicts of interest may arise between HCI and us, including those involving our executive officers and directors who hold positions or financial interests. In addition, if HCI were to sell a controlling interest of the Company in a private transaction, shareholders may not receive a change-of-control premium and we could become subject to control by an unknown third party. We may also face challenges in realizing the anticipated benefits of operating as a standalone public company, including increased costs, regulatory compliance obligations, and demands on management resources. For further discussion of certain of these factors, see the risk factors disclosed in the section entitled "Risk Factors" in this Quarterly Report and in the 2025 Annual Report. You are cautioned not to place undue reliance on such forward-looking statements, which are not guarantees of future performance, and our actual results of operations, financial condition, and liquidity, and the development of the industry in which we operate, may differ materially from the forward-looking statements contained in this Quarterly Report. Any forward-looking statement in this Quarterly Report speaks only as of the date of such statement, and except as required by federal securities laws, we do not undertake any obligation to update or revise, or to publicly announce any update or revision to, any of the forward-looking statements, whether as a result of new information, future events or otherwise, after the date of this Quarterly Report. Company Overview Exzeo provides turnkey insurance technology and operations solutions to insurance carriers and their agents (collectively referred to as Exzeo's "customers") through a proprietary platform of internally developed software and data analytics applications designed specifically for the P&C insurance market. 21 Table of Contents Our Insurance-as-a-Service platform, referred to as the Exzeo Platform, includes nine highly configurable software and analytics applications that are purpose-built to serve the insurance value chain. The Exzeo Platform provides technology-based solutions for operational and administrative activities and functions performed by insurance carriers and their agents, including quoting and underwriting, policy management, claims management, data reporting, and financial reporting. Through these capabilities, the Exzeo Platform streamlines and automates insurance operational workflows across carriers, agents and policyholders. The Exzeo business was established in 2012 as the technology and innovation division of HCI, a leading underwriter of homeowners insurance in Florida that now writes policies in 12 additional states. Since inception, we have been led by experienced technology and insurance professionals with deep domain expertise focused on developing advanced data analytics algorithms and software tools that enable carriers to maximize system efficiency, optimize underwriting outcomes, and serve their customers more effectively. The Exzeo Platform is a proprietary suite of software, analytics, and visualization tools capable of supporting, enhancing, or replacing legacy operational systems commonly used in the insurance industry. We enter into MGA or policy administration services agreements with our insurance-industry customers under which we serve as an MGA of an insurance carrier or provide services to a carrier's MGA in exchange for fees largely based on a percentage of managed premiums. Under these agreements, we utilize the Exzeo Platform to provide policy issuance and renewal services, as well as management services such as soliciting and negotiating reinsurance for authorized programs, managing and maintaining policy administration, and providing claims management. Key Factors and Trends Affecting Results of Operations We believe our performance and future success depend on a number of factors that present significant opportunities for us but also pose risks and challenges, including those discussed below and in the section entitled Item 1A. Risk Factors, included in our 2025 Annual Report. • Underwriting performance and continued investments in our technology. We leverage data, technology, and proprietary underwriting algorithms to enhance risk management. For example, we incorporate additional dynamic external data sources and apply advanced statistical methods to model that information into our pricing algorithms. We expect to improve our ability to manage and price risk accurately over time as we incorporate new external data sources and utilize the experience gained over time with HCI's policyholder base and other carrier programs. These enhancements are expected to lead to better underwriting, lower loss frequency, and lower loss ratios over time, after adjusting for weather-related events. Our success in this area depends on our ability to continually integrate new data sources and apply them effectively to improve our ability to accurately and competitively price risk. • Intense competition in our market. The market for core system software serving the P&C insurance industry is highly competitive and fragmented. This market is subject to changing technology, shifting customer needs, and introductions of new products and services. Our competitors vary in size and in the breadth and scope of the products and services offered. The principal competitive factors in our industry include total cost of ownership, product functionality, flexibility and performance, customer references and in-depth knowledge of the P&C insurance industry. We believe that we compete favorably with our competitors on the basis of each of these factors. However, many of our current or potential competitors have greater financial and other resources, greater name recognition, and longer operating histories than we do. • New customer success and retention. We have relied and expect to continue to rely on customer relationships with a relatively small number of carriers in the P&C insurance industry for a substantial portion of our revenue, and the loss of any of these customers or a reduction in revenue from any of these customers would significantly harm our business, results of operations, and financial condition. As part of our growth strategy, we are focused on expanding our customer base by developing new partnerships with additional carriers and their agents. Our future operating results will depend, in part, on the rate at which we acquire new customers that are not affiliates of HCI and maintain our relationships with existing customers as measured by the amount of managed premium on our platform. We believe that introducing these prospective customers to the advantages of our technology and variable fee structure will be critical to diversifying our revenue and reducing customer concentration over time. Our ability to support this expansion depends on the continued performance of our customer success and support teams, which are critical to ensuring high customer satisfaction, adoption, and retention. • National expansion strategy / Expansion into new geographies and use cases. We believe national expansion will be a key driver of our long-term growth and success of our business. As of March 31, 2026, we provide services to P&C companies in Connecticut, Florida, Georgia, Massachusetts, Montana, Nevada, New Jersey, New Mexico, North Carolina, Rhode Island, South Carolina, South Dakota, and Utah. We expect to apply our highly scalable model nationally, using a tailored approach in each state that reflects its regulatory environment and local market dynamics. We aim to expand rapidly and efficiently across different geographies while maintaining a high level of control over our strategy within each market. State expansion should create a broader base from which to grow premiums and increase the geographic diversity in the policyholder base and risk portfo [Excerpt truncated for page length; source filing is linked above.] ## Latest 10-K MD&A Extracted structurally from real Item 7 body heading to real Item 7A/8 boundary. Confidence: high Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations. The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our Consolidated Financial Statements and the related notes included elsewhere in this Annual Report on Form 10-K. This section is intended to provide management’s perspective on our financial performance, material events, trends, and uncertainties that may affect our business, financial condition, results of operations, and cash flows. This discussion contains forward-looking statements that are based on current expectations and assumptions and involve risks and uncertainties. Actual results may differ materially from those expressed or implied in these forward-looking statements due to various factors, including those described in the section entitled "Risk Factors" included elsewhere in this Annual Report on Form 10-K. Our historical results of operations are not necessarily indicative of future results. A discussion regarding our financial condition and results of operations, based on the income statement for the fiscal year ended December 31, 2025 compared to fiscal years ended December 31, 2024 is presented below. A discussion regarding our financial condition and results of operations for the fiscal year ended December 31, 2024 compared to the fiscal year ended December 31, 2023 can be found in "Management's Discussion and Analysis of Financial Condition and Results of Operations" included the final prospectus for our IPO dated as of November 4, 2025 and filed with the SEC pursuant to Rule 424(b)(4) on November 5, 2025. Unless otherwise indicated, all dollar amounts other than per-share amounts are presented in thousands. Company Overview Exzeo provides turnkey insurance technology and operations solutions to customers through a proprietary platform of purpose-built software and data analytics applications designed specifically for the P&C insurance ecosystem. Our IaaS platform, referred to as the Exzeo Platform, includes nine highly configurable software and analytics applications that are purpose-built to serve the insurance value chain. The Exzeo Platform provides technology-based solutions for operational and administrative activities and functions performed by insurance carriers and their agents, including quoting and underwriting, policy management, claims management, data reporting, and financial reporting. As a result, the Exzeo Platform streamlines and automates interactions between insurance carriers and policyholders. The Exzeo business was established in 2012 as the technology and innovation division of HCI, a leading underwriter of homeowners insurance in Florida that now writes policies in 12 additional states. Since inception, we have been led by experienced technology and insurance professionals with deep domain expertise focused on developing advanced data analytics algorithms and software tools that enable carriers to maximize system efficiency, optimize underwriting outcomes, and serve their customers more effectively. The Exzeo Platform is a proprietary suite of software, analytics, and visualization tools capable of supporting, enhancing or replacing legacy operational systems that are common across the insurance industry. We enter into MGA or policy administration services agreements with our insurance-industry customers under which we serve as an MGA of an insurance carrier or provide services to a carrier's MGA in exchange for fees largely based on a percentage of managed premiums. Under these agreements, we utilize the Exzeo Platform to provide policy issuance and renewal services, as well as management services such as soliciting and negotiating reinsurance for authorized programs, managing and maintaining policy administration, and providing claims management. Discontinued Operations Prior to July 2024, we operated in the P&C insurance business, primarily focused on homeowners' multi-peril policies in the State of Florida, through our subsidiary TTIC. On July 1, 2024, we transferred all 2,500,000 outstanding shares of TTIC to HCI in exchange for the settlement of promissory notes issued by us. The sale of TTIC constituted the disposal of a significant component of our business and resulted in a strategic shift in our operations, with a material effect on our financial results. Accordingly, TTIC's results are reflected in our Consolidated Financial Statements as discontinued operations and are presented as assets and liabilities of discontinued operations on the Consolidated Balance Sheets and income from discontinued operations on the Consolidated Statements of Income. Unless otherwise stated, all discussions regarding the results for the periods presented reflect our continuing operations. Because the transaction occurred between entities under common control and did not result in a change in control of TTIC, it was accounted for as a common control transaction and recorded as an equity transaction. The purpose of the transaction was to restructure our organization, allowing us to concentrate on expanding our technology and insurance solutions services while reducing debt and strengthening our capital structure and balance sheet. Refer to Note 2. Discontinued Operations to our Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K. 40 Table of Contents Initial Public Offering On November 6, 2025 the Company closed its IPO, issuing 8,000,000 shares of common stock at a price of $21.00 per share for gross proceeds of $168,000. Underwriting discounts and commissions totaled approximately $11,760 and were recorded as a reduction of IPO gross proceeds. Other qualifying costs totaled approximately $1,486 and were recorded as a reduction of the IPO gross proceeds within additional paid-in capital. As of December 31, 2025, qualifying offering costs include $382 of unpaid amounts, which are recorded in Accounts payable and accrued liabilities on the Consolidated Balance Sheets. Cash payments for qualifying offering costs recorded as a reduction of equity are reflected within financing activities in the Consolidated Statements of Cash Flows. Key Factors and Trends Affecting Results of Operations We believe our performance and future success depends on a number of factors that present significant opportunities for us but also pose risks and challenges, including those discussed below and in the section entitled Item 1A, Risk Factors. • Underwriting performance and continued investments in our technology. We leverage data, technology, and proprietary underwriting algorithms to enhance risk management. For example, we incorporate additional dynamic external data sources and apply advanced statistical methods to model that information into our pricing algorithms. We expect to improve our ability to manage and price risk accurately over time as we incorporate new external data sources and utilize the experience gained over time with HCI's policyholder base and other carrier programs. These enhancements are expected to lead to better underwriting, lower loss frequency, and lower loss ratios over time, after adjusting for weather-related events. Our success in this area depends on our ability to continually integrate new data sources and apply them effectively to improve our ability to accurately and competitively price risk. • Intense competition in our market. The market for core system software serving the P&C insurance industry is highly competitive and fragmented. This market is subject to changing technology, shifting customer needs, and introductions of new products and services. Our competitors vary in size and in the breadth and scope of the products and services offered. The principal competitive factors in our industry include total cost of ownership, product functionality, flexibility and performance, customer references and in-depth knowledge of the P&C insurance industry. We believe that we compete favorably with our competitors on the basis of each of these factors. However, many of our current or potential competitors have greater financial and other resources, greater name recognition, and longer operating histories than we do. • New customer success and retention. We have relied and expect to continue to rely on customer relationships with a relatively small number of carriers in the P&C insurance industry for a substantial portion of our revenue, and the loss of any of these customers or a reduction in revenue from any of these customers would significantly harm our business, results of operations and financial condition. While we currently have two customers that are not affiliated with HCI, revenue from these customers was immaterial in 2025. As part of our growth strategy, we are focused on expanding our customer base by developing new partnerships with additional carriers and their agents. Our future operating results will depend, in part, on the rate at which we acquire new customers that are not affiliates of HCI and maintain our relationships with existing customers as measured by the amount of managed premium on our platform. We believe that introducing these prospective customers to the advantages of our technology and variable fee structure will be critical to diversifying our revenue and reducing customer concentration over time. Our ability to support this expansion depends on the continued performance of our customer success and support teams, which are critical to ensuring high customer satisfaction, adoption, and retention. • National expansion strategy / Expansion into new geographies and use cases. We believe national expansion will be a key driver of our long-term growth and success of our business. As of December 31, 2025, we provide services to P&C companies in Connecticut, Florida, Georgia, Massachusetts, Montana, Nevada, New Jersey, New Mexico, North Carolina, Rhode Island, South Carolina, South Dakota, and Utah. We expect to apply our highly scalable model nationally, using a tailored approach in each state that reflects its regulatory environment and local market dynamics. We aim to expand rapidly and efficiently across different geographies while maintaining a high level of control over our strategy within each market. State expansion should create a broader base from which to grow premiums and increase the geographic diversity in the policyholder base and risk portfolio that we manage. We believe that broader geographic diversification will also improve our ability to secure favorable terms from reinsurers, improving the overall cost structure and profitability for our customers. 41 Table of Contents • Regulatory matters. The legal environment for cloud-based technology businesses is evolving in the United States, and we are subject to a variety of laws and regulations that involve matters central to our business. Many of these laws and regulations are still evolving and being tested in courts and could be interpreted in ways that could harm our business. These may involve privacy, data protection and personal information, content, intellectual property, data security, and data retention and deletion. In particular, we are subject to federal and state laws regarding privacy and protection of personal data. U.S. federal and state laws and regulations, which in some cases can be enforced by private parties in addition to government entities, are constantly evolving and can be subject to significant change. As a result, the application, interpretation, and enforcement of these laws and regulations are often uncertain, particularly in the evolving industry in which we operate, and may be interpreted and applied inconsistently from state to state and inconsistently with our current policies and practices. • Data privacy. Our customers and their policyholders upload to and store their data in our cloud-based platform. This presents legal challenges to our business and operations, such as consumer privacy rights and intellectual property rights. We must monitor and comply with a wide variety of laws and regulations regarding the data stored and processed on our cloud-based platform as well as in the operation of our business. Non-compliance with these laws could result in penalties or significant legal liability. We have invested, and continue to invest, human and technology resources into our compliance efforts and our data privacy compliance efforts generally. • Transition to a standalone public company. Since our IPO in November 2025, we became subject to federal and state securities laws, and applicable stock exchange requirements. Operating as a standalone public company requires, us to build and enhance governance structures and corporate functions including external financial reporting, internal audit, treasury, investor relations, Board of Directors and Officer support, and stock administration, which have resulted and are expected to continue to result, in additional costs. Presentation of Financial Information Unless otherwise indicated, all dollar amounts presented in this Management's Discussion and Analysis of Financial Condition and Results of Operations are stated in thousands of dollars. Percentages and ratios are based on the underlying whole dollar amount. Key Performance Metrics We review a number of key operating metrics, which we use as we make strategic decisions, measure our performance, evaluate our business, and identify trends in our business. These operational measures are presented as follows: Years Ended December 31, (in thousands, except percentages and counts) 2025 2024 Managed Premium $ 1,385,888 $ 580,276 Managed Policies 313,368 112,475 Premium Per Policy $ 4,423 $ 5,159 Gross Dollar Retention Rate 87.2 % 95.1 % Net Dollar Retention Rate 238.8 % 151.1 % Annual Recurring Revenue $ 214,898 $ 138,462 Managed Premium Managed premium is defined as the aggregate gross dollar value of in-force premiums that are processed, managed, or administered by our software solutions as of the period end date. This excludes any applicable policy fee income associated with managed policies. Premium pricing may vary by state due to a combination of factors including regulatory requirements; however, the majority of the policies are written in the state of Florida. Revenue is primarily derived from usage-based pricing models, which are structured based on the amount of managed premiums processed, in most cases. We view this as an important metric because it is an indicator of the overall size of our platform. However, managed premium is an operational metric and should not be considered a substitute for revenue or other financial results. Managed premiums attributable to insurance policies written in Florida represented 91.3% and 84.8% of total managed premiums for the years ended December 31, 2025 and 2024, respectively. 42 Table of Contents Managed Policies Managed policies are defined as the number of currently active policies managed by us on our platform as of the period end date. We consider managed policies a key metric for evaluating our financial performance, as growth in the number of managed policies not only drives revenue growth, but we also believe that an increase in managed policies may reflect broader brand awareness and deeper market penetration of our Exzeo Platform. Premium Per Policy Premium per policy is defined as the managed premium divided by managed policies. We view premium per policy as an important metric which provides information as to the average size of our customers' policyholder relationships. Growth in the metric can be indicative of increased coverages offered to our customers. Gross Dollar Retention Rate Gross dollar retention rate measures the percentage of managed premium retained from our customers' existing policyholders. We calculate gross dollar retention rate by measuring the managed premium attributable to policyholders who remained active as of the end of the current period and dividing this amount by the managed premium attributable to those same policyholders as of the end of the corresponding prior-year period (i.e. twelve months earlier). We believe the gross dollar retention rate is a valuable indicator of platform engagement among existing policyholders and provides insight into our ability to retain and sustain premium volume over time through our services. The managed premiums attributable to policyholders active from the end of the prior year used to calculate the gross dollar retention rate were $506,278 and $365,419 as of December 31, 2025 and 2024, respectively. Net Dollar Retention Rate We use NRR as a key performance metric to measure the success of our carrier customer relationships and the growth of our revenue from new and existing carrier customers. To calculate NRR, we divide the amount of managed premium from new and existing policyholders of our customers at the end of the current period, by the amount of managed premium attributable to the policyholders active as of the respective prior-year period (i.e., twelve months earlier). Our NRR is influenced by both the growth of existing carrier customers on the platform as well as the addition of new carrier customers. We believe that maintaining a high NRR is critical to achieving sustained long-term growth and reflects the strength of our value proposition to existing as well as future customers. Annual Recurring Revenue We use ARR as a key operational metric to assess the scale of our recurring revenue generated from managed premium. ARR is defined as the sum of each customer's managed premiums, multiplied by their respective contractual fee rates, plus any applicable policy fee income associated with managed policies as of the period end date. ARR excludes revenue from non-recurring sources, such as catastrophe services. Components of Operating Results Revenue We generate revenue from three primary sources: underwriting and management services, claim services, and other technology services. Underwriting and management services include policy issuance and renewal, reinsurance placement, and administrative support, with fees tied to a percentage of premiums written or assumed, plus related policy fees. Claim services involve investigating, adjusting, and settling claims, including catastrophe-related claims, with pricing based on percentage of premiums written or assumed, per-claim fees and/or a percentage of indemnification costs. Other technology services are primarily derived from proprietary software solutions offered through SaaS service agreements, with fees based on a combination of policy or claim volumes, fixed charges, or percentages of claims handled. Cost of revenue Our cost of revenue includes expenses directly attributable to delivering our services that generate revenue, such as salaries and benefits for employees supporting underwriting, management, administrative, and claim services. For one customer, we collect fees that include agent commissions and remit those commissions to agents. Cost of revenue also includes amortization of capitalized internal-use-software and other intangible assets used to provide services, information technology expenses supporting policy underwriting, administrative functions, and claim handling services, and allocated overhead. Claim handling costs include adjustment, investigation, defense, recording, and payment functions. Allocated expenses from departments supporting these functions are also included in cost of revenue. 43 Table of Contents Gross profit Gross profit represents revenue less cost of revenue. The increase in gross profit in recent periods was primarily driven by growth in managed premium, which allows us to leverage our relatively fixed cost structure. As we continue to scale and achieve operational efficiencies, we expect gross margins to improve over time. Selling, general and administrative expenses Selling, general and administrative expenses represent costs associated with supporting operations and primarily consist of employee compensation, including stock-based compensation and benefits for our finance, IT, human resources, legal, sales, and general management functions, as well as facilities and professional services. Research and development Our research and development costs consist primarily of personnel expenses, including salaries and benefits, bonuses, stock-based compensation and related overhead costs for employees engaged in the design and development of our technology offerings and other internally developed systems and applications. Depreciation and amortization Depreciation and amortization costs reflect expenses associated with the ongoing use of our tangible long-lived assets, including computer hardware, office furniture and equipment, and leasehold improvements. Investment income Investment income represents interest earned from short-term investments. The principal factors that influence investment income are the size of our investment portfolio and the yield on that portfolio. Interest expense Interest expense primarily consists of allocation of interest from borrowing and funding arrangements associated with notes payable and loans to HCI. Income tax expense Income tax expense primarily consists of domestic corporate federal and state income taxes related to the sale of our services. The effective tax rate can be affected by many factors, including changes in tax laws, states in which we operate, regulations or rates, new interpretations of existing laws or regulations, and changes to our overall levels of income before tax. 44 Table of Contents Results of Operations Years Ended December 31, 2025 and 2024 Selected financial information for the years ended December 31, 2025 and 2024, including amounts expressed as a percentage of total revenue and the year-over-year change, is presented as follows: Years Ended December 31, Percentage of Revenue Increase (Decrease) (in thousands, except percentages) 2025 2024 2025 2024 2025 vs. 2024 Revenue $ 216,980 $ 133,948 100.0 % 100.0 % 62.0 % Cost of revenue 85,957 80,739 39.6 % 60.3 % 6.5 % Gross profit 131,023 53,209 60.4 % 39.7 % 146.2 % Selling, general and administrative 15,724 8,343 7.2 % 6.2 % 88.5 % Research and development 8,830 6,514 4.1 % 4.9 % 35.6 % Depreciation and amortization 479 335 0.2 % 0.3 % 43.0 % Total operating expenses 25,033 15,192 11.5 % 11.4 % 64.8 % Operating income 105,990 38,017 48.8 % 28.3 % 178.8 % Investment income 4,302 548 2.0 % 0.4 % 685.0 % Interest expense — (3,329 ) 0.0 % (2.5 )% (100.0 )% Income from continuing operations before taxes $ 110,292 $ 35,236 50.8 % 26.2 % 213.0 % Income tax expense 27,543 9,168 12.7 % 6.8 % 200.4 % Net income from continuing operations $ 82,749 $ 26,068 38.1 % 19.4 % 217.4 % Comparison of the Years Ended December 31, 2025 and 2024 Revenue Years Ended December 31, Change (in thousands, except percentages) 2025 2024 ($) (%) Underwriting and management $ 176,368 $ 95,373 80,995 84.9 % Claim services (1) 31,154 30,777 377 1.2 % Other technology services 9,458 7,798 1,660 21.3 % Total revenue $ 216,980 $ 133,948 83,032 62.0 % (1) Portion of this revenue is earned through services delivered directly via outsourcing to a subsidiary of HCI. Although this revenue is recognized on a gross basis because we are considered the principal in the transaction, the economics are largely neutral, as the related costs incurred from the subsidiary of HCI closely match the revenue recognized. Refer to Non-GAAP Financial Measures for additional information. Revenue increased by $83,032, or 62.0%, to $216,980 for the year ended December 31, 2025 compared to $133,948 for the same period in 2024, driven primarily by growth in underwriting and management services from our existing customer base and expansion of the scope of services provided to customers throughout 2025. Underwriting and management revenue increased by $80,995, or 84.9%, to $176,368 for 2025, compared to $95,373 in 2024, representing 81.3% and 71.2% of total revenue, respectively. The increase was primarily driven by new management fee arrangements with four additional customers, which together accounted for approximately 82.3% of the total increase, with the remainder driven by growth in managed premiums from our existing customer base. The fee rate charged as a percentage of premium managed was modestly lower in 2025 compared to 2024, reflecting changes in service mix. Claim services revenue increased by $377, or 1.2%, to $31,154 for 2025, compared to $30,777 in 2024, representing 14.4% and 23.0% of total revenue, respectively. The slight increase was primarily driven by higher managed premiums from our existing customer base, which increased related claims volume and associated service fees as fee rates were substantially unchanged between 2025 and 2024. This increase was partially offset by lower catastrophe claim service fees and reduced field adjuster service fees, as the elevated storm related activity experienced in 2024 did not recur at similar levels in 2025. Claim services revenue in future periods will continue to be influenced by the level of managed premiums and the timing and severity of weather events. 45 Table of Contents Other technology services revenue increased by $1,660, or 21.3%, to $9,458 for 2025, compared to $7,798 in 2024, representing 4.4% and 5.8% of total revenue, respectively. The increase was primarily driven by higher catastrophe software fees, related to Hurricanes Milton and Helene, which began generating significant revenue in 2025 based on timing of catastrophe events. The increase was partially offset by lower demand for non-Catastrophe software solutions. Catastrophe related software activity is event driven and may not occur at similar levels in future periods. Cost of Revenue Years Ended December 31, Change (in thousands, except percentages) 2025 2024 ($) (%) Policy commission and related expenses $ 43,724 $ 39,013 $ 4,711 12.1 % Outsourced claims fees 11,167 13,779 (2,612 ) (19.0 )% Direct personnel expense 17,122 13,422 3,700 27.6 % Other operating expenses 11,532 12,298 (766 ) (6.2 )% Depreciation and amortization 2,412 2,227 185 8.3 % Total cost of revenue $ 85,957 $ 80,739 $ 5,218 6.5 % Cost of revenue increased by $5,218, or 6.5%, to $85,957 for the year ended December 31, 2025, compared to $80,739 for the same period in 2024, representing 39.6% and 60.3% of total revenue, respectively. The decrease in the cost of revenue as a percentage of revenue was primarily driven by improved operating leverage from higher revenue volumes. Policy commission and related expenses increased by $4,711, or 12.1%, to $43,724 for 2025, compared to $39,013 in 2024, representing 20.2% and 29.1% of total revenue, respectively. The increase was driven by growth in managed premiums from the existing customer base for the single carrier under our commission based arrangement, resulting in higher commission activity in 2025. The weighted average commission rate was 9.1% in 2025, compared to 9.3% in 2024. The decrease was primarily driven by a higher concentration of Florida business for this single carrier, with Florida premiums increasing from 66.8% of total managed premiums for 2024 to 72.3% in 2025, where commission rates are generally lower due to competitive market dynamics. As a result, the overall commission rate as a percentage of premium declined despite higher managed premiums. Outsourced claims fees decreased by $2,612, or 19.0%, to $11,167 for the year ended December 31, 2025, compared to $13,779 in 2024, representing 5.1% and 10.3% of total revenue, respectively. The decrease was due to lower catastrophe claims development in 2025 and reduced litigation related activity compared to elevated activity in 2024, when storm from prior years continued to generate new claims and litigation related costs. Catastrophe related activity is inherently volatile and may not recur at similar levels in future periods. Direct personnel expense increased by $3,700, or 27.6%, to $17,122 for 2025 compared to $13,422 in 2024, representing 7.9% and 10.0% of total revenue, respectively. The increase was primarily driven by higher compensation-related costs including salaries and wages, discretionary pay and employee benefits associated with growth in headcount supporting underwriting and claims operations. These increases were partially offset by lower stock-based compensation expense, as most awards had vested at the time of TTIC's disposal in 2024. Other operating expenses decreased by $766, or 6.2%, to $11,532 for 2025, compared to $12,298 in 2024, representing 5.3% and 9.2% of total revenue, respectively. The decrease was driven by lower claims management activity along with lower bank fee charges following a system optimization initiative implemented in 2025. These decreases were partially offset by the increase in systems expenses related to investments to strengthen infrastructure to support our growth. Depreciation and amortization increased to $2,412 for 2025, compared to $2,227 in 2024, representing 1.1% and 1.7% of total revenue, respectively. Depreciation and amortization remained relatively consistent year over year and did not materially affect our cost structure. Operating Expenses Years Ended December 31, Change (in thousands, except percentages) 2025 2024 ($) (%) Selling, general and administrative $ 15,724 $ 8,343 $ 7,381 88.5 % Research and development 8,830 6,514 2,316 35.6 % Depreciation and amortization 479 335 144 43.0 % Total operating expenses $ 25,033 $ 15,192 $ 9,841 64.8 % 46 Table of Contents Operating expenses increased by $9,841, or 64.8%, to $25,033 for the year ended December 31, 2025, compared to $15,192 for the same period in 2024, representing 11.5% and 11.3% of total revenue, respectively. Operating expenses remained relatively flat as a percentage of revenue year-over-year, as expense growth was generally aligned with revenue growth. Selling, general and administrative expenses increased by $7,381, or 88.5%, to $15,724 for 2025, compared to $8,343 in 2024, representing 7.2% and 6.2% of total revenue, respectively. Employee-related costs accounted for the majority of the increase, including discretionary compensation tied to improved performance and salary and wage expenses resulting from higher headcount to support business growth. The remaining increase reflects higher administrative costs associated with scaling operations, partially offset by lower overhead allocations to TTIC following its disposal. The corporate overhead allocation to TTIC included shared services such as HR, IT, legal, accounting, and lease-related costs which were allocated using methodologies appropriate to each cost type and applied consistently for all periods presented. We ceased providing corporate services, and therefore ceased allocating related expenses, to TTIC as of July 1, 2025. Research and development expenses increased by $2,316, or 35.6%, to $8,830 for 2025, compared to $6,514 in 2024, representing 4.1% and 4.9% of total revenue, respectively. The increase was primarily driven by a higher portion of internal software development costs due to various ongoing projects, as well as higher personnel-related costs, including salaries, wages, and discretionary pay as we continued to invest in technology development and platform enhancements to support business growth. Depreciation and amortization increased to $479, for the year ended December compared to $335 in 2024, representing 0.2% and 0.3% of total revenue, respectively. Depreciation and amortization remained relatively consistent year-over-year. Investment Income Years Ended December 31, Change (in thousands, except percentages) 2025 2024 ($) (%) Investment income $ 4,302 $ 548 $ 3,754 685.0 % Investment income increased by $3,754, or 685.0%, to $4,302 for the year ended December 31, 2025, compared to $548 in 2024, primarily due to higher average investable cash balances during 2025. The higher cash balances were driven by higher net cash provided by operating activities during the year and a significant increase in cash during the fourth quarter of 2025 resulting from net IPO proceeds, which were held in money market accounts that generated additional interest income. While market interest rates and yields were lower compared to the prior year, the significantly larger balances held in money market and deposit accounts more than offset the lower yield environment. Investment income may fluctuate in future periods based on cash levels, timing of proceeds deployment, and market conditions. Interest Expense Years Ended December 31, Change (in thousands, except percentages) 2025 2024 ($) (%) Interest expense $ — $ 3,329 $ (3,329 ) (100 )% There was no interest expense recorded for the year ended December 31, 2025, compared to $3,329 in 2024, representing a decrease of 100%. The decrease reflects the impact of the July 1, 2024 common control transaction with HCI, under which all promissory notes previously issued to HCI were treated as repaid, except for a single note that remained outstanding after the transaction. That remaining note was fully repaid in November 2024, resulting in us having no interest-bearing obligations during 2025. As a result, we did not incur any interest expense for the periods presented. Income Tax Years Ended December 31, Change (in thousands, except percentages) 2025 2024 ($) (%) Income from continuing operations, before taxes $ 110,292 $ 35,236 $ 75,056 213.0 % Income tax expense from continuing operations 27,543 9,168 18,375 200.4 % Effective tax rate 25.0 % 26.0 % 47 Table of Contents Income tax expense from continuing operations increased by $18,375, or 200.4%, to $27,543 for the year ended December 31, 2025, compared to $9,168 in 2024. Our effective tax rate was 25.0% for 2025, compared to 26.0% for 2024. Our effective tax rate for both periods exceeded the U.S. federal statutory rate of 21.0%, The difference was primarily driven by state income taxes, net of federal tax benefits, of approximately 4.0%, and other immaterial nondeductible expenses. The year-over-year decrease in the effective tax rate was primarily driven by increased excess tax benefits related to restricted stock awards compared to 2024. We expect our effective tax rate to continue to vary from the statutory rate due to similar permanent differences and state tax obligations. There were no material changes in our income tax estimation methodologies for the periods presented. Non-GAAP Financial Measures In addition to results determined in accordance with GAAP, we use certain non-GAAP financial measures to evaluate our operating performance and make strategic decisions. These non-GAAP financial measures include Adjusted EBITDA, Adjusted Revenue, Adjusted EBITA Margin, Free Cash Flow. Management believes these measures provide useful supplemental information for investors by facilitating comparisons of performance across reporting periods and with other companies in the industry, many of which use similar non-GAAP financial measures. However, these non-GAAP financial measures are not prepared in accordance with GAAP, are not based on a standardized methodology, and may not be comparable to similarly titled measures used by other companies. They should not be considered in isolation or as a substitute for financial information presented in accordance with GAAP. These measures exclude items that may be significant to an understanding of our financial condition and results of operations under GAAP. The use of non-GAAP financial measures involves management judgment regarding which items to exclude or include. Accordingly, these measures have limitations and should be viewed as a supplement to, not a replacement for, our GAAP results. Management urges investors to review the reconciliations of these non-GAAP financial measures to the most directly comparable GAAP measures included in this report and not to rely on any single financial measure to evaluate our business. Adjusted EBITDA We define Adjusted EBITDA as Income from continuing operations, after taxes adjusted to exclude income tax expense, interest expense, investment income, depreciation and amortization, and stock-based compensation expense. Management uses Adjusted EBITDA as a key measure of operating performance and to assess the results of the business excluding certain items that are not considered indicative of core operating results. Adjusted EBITDA should not be viewed in isolation or as a substitute for net income calculated in accordance with GAAP, and other companies may define Adjusted EBITDA differently. The reconciliation of Income from continuing operations, after taxes to Adjusted EBITDA for the periods presented is as follows: Years Ended December 31, (in thousands) 2025 2024 Income from continuing operations, after taxes $ 82,749 $ 26,068 Income tax expense 27,543 9,168 Interest expense — 3,329 Investment income (4,302 ) (548 ) Depreciation and amortization 2,891 2,562 Stock-based compensation 2,636 3,379 Adjusted EBITDA $ 111,517 $ 43,958 Adjusted Revenue We define Adjusted Revenue as the portion of total revenue earned through services delivered directly via our proprietary platform technology. This metric excludes revenue associated with services primarily within claims management that are outsourced to a subsidiary of HCI. Although this revenue is recognized on a gross basis under GAAP because we are considered the principal in the transaction, the economics are largely neutral, as the related costs incurred from outsourced service providers closely match the revenue recognized. Management believes Adjusted Revenue provides investors with useful insight into the performance and scalability of our core platform services and reflects the revenue generated from internally delivered operations, excluding variability associated with outsourced service arrangements. This non-GAAP measure should not be considered in isolation or as a substitute for total revenue or any other performance measure calculated in accordance with GAAP. 48 Table of Contents The reconciliation of the Adjusted Revenue for the periods presented is as follows: Years Ended December 31, (in thousands) 2025 2024  Revenue $ 216,980 $ 133,948 Less: Outsourced claims fees 11,167 13,779  Adjusted Revenue $ 205,813 $ 120,169 Adjusted EBITDA Margin We define Adjusted EBITDA Margin as Adjusted EBITDA expressed as a percentage of Adjusted Revenue. This non-GAAP measure provides management and investors with additional insight into the Company's operating efficiency and the scalability of our business model, as it reflects our progress toward long-term profitability. The reconciliation of Adjusted EBITDA Margin for the periods presented is as follows: Years Ended December 31, (in thousands, except percentages) 2025 2024 Numerator: Adjusted EBITDA $ 111,517 $ 43,958 Denominator: Adjusted Revenue 205,813 120,169 Adjusted EBITDA Margin 54.2 % 36.6 % Free Cash Flow We define Free Cash Flow as net cash provided by operating activities less capital expenditures during the period. We believe information regarding Free Cash Flow provides useful information to management and investors because it is an indicator of strength and performance of our business operations after funding capital expenditures. Capital expenditures consist of capitalized software development costs and costs relating to property and equipment, such as computer hardware, office furniture and equipment, and leasehold improvements. Free Cash Flow should not be considered an alternative to net cash provided by operating activities, which is the most directly comparable GAAP measure, or as a measure of liquidity prepared in accordance with GAAP and may not be comparable to similar measures used by other companies. The reconciliation of Free Cash Flow for the periods presented is as follows: Years Ended December 31, (in thousands) 2025 2024 Cash provided by operating activities $ 100,298 $ 49,266 Less: Capital expenditures 2,844 3,334 Free Cash Flow $ 97,454 $ 45,932 Liquidity and Capital Resources General Our principal sources of liquidity, consisting of cash and cash equivalents and cash generated from continuing operations, are presented as follows: Years Ended December 31, (in thousands) 2025 2024 Cash and cash equivalents $ 305,372 $ 54,502 Working capital 241,432 10,854 The increase in cash and working capital during 2025 primarily reflects net proceeds from our IPO, with additional contribution from cash generated from operations, driven by overall growth in our managed premium base. We do not have any off-balance sheet arrangements that have, or are reasonably likely to have, a material effect on our liquidity, capital resources, or financial condition. We believe that our existing cash and cash equivalents, together with expected operating cash flows, will be sufficient to meet working capital, capital expenditures, and other liquidity requirements for at least the next 12 months. We have no material long-term contractual obligations other than standard vendor agreements and lease commitments. 49 Table of Contents Our primary cash requirements include employee compensation and outsourced fees, cloud hosting and infrastructure costs, and ongoing investment in product development. At current operating levels, these requirements are expected to be supported by operating cash flows. Based on our current financial position, we also believe that our liquidity sources will be adequate to meet our long-term needs beyond the next twelve months. Over the longer term, our liquidity will depend primarily on our ability to generate cash from operations as our managed premium base scales and we continue to expand our technology and service offerings. Sources of Liquidity Our capital requirements depend on several factors, including the volume of insurance policy issuance managed on our platform, the level of claims related services we provide, operating expenses, investments in information technology systems, and the expansion of sales and marketing activities. Our current liquidity sources consist of existing cash and cash equivalents generated from operations. In the future, we may raise additional funds through the issuance of debt or equity securities or the borrowing of money. There can be no assurance that such financing would be available on favorable terms, or at all. Cash Flow Summary A summary of cash flows from continuing operations is as follows: Years Ended December 31, (in thousands) 2025 2024 Net cash provided by (used in): Operating activities from continuing operations $ 100,298 $ 49,266 Investing activities from continuing operations $ (2,844 ) $ (3,334 ) Financing activities from continuing operations $ 153,646 $ (6,398 ) Operating Activities Net cash provided by operating activities for the year ended December 31, 2025 was $100,298, an increase of $51,032 from $49,266 in 2024. The improvement was primarily driven by higher operating income from continuing operations of $82,749 and favorable changes in net working capital. Working capital benefited from higher up-front cash collections on services provided to an expanded customer base. These favorable impacts were partially offset by lower cash collections from related parties of $8,221, reflecting the timing of settlements and higher cash outflows related to contract fulfillment activities of $3,689, driven by increased volume of managed premiums. Investing Activities Net cash used in investing activities for the year ended December 31, 2025 was $2,844, compared to $3,334 in 2024, a decrease of $490. Cash outflows in both periods primarily reflect capital investments in software development and infrastructure, consistent with our strategy to support and enhance core operations. A portion of these expenditures also related to property and equipment, representing maintenance-level investments consistent with prior periods. Financing Activities Net cash provided by financing for the year ended December 31, 2025 was $153,646 compared to net cash used in financing of $6,398 in 2024, an increase of $160,044. The change was primarily driven by the net proceeds from our IPO, which totaled $156,205 in 2025. In 2024, financing outflows included the redemption of preferred stock and related dividend payments, partially offset by proceeds from the issuance of notes payable to a related party. No comparable redemptions, dividends, or related party note issuances occurred in 2025. Critical Accounting Policies and Estimates The preparation of our Consolidated Financial Statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, expenses, and related disclosures. These estimates are inherently uncertain and require significant judgment, particularly in areas that involve complex or subjective assumptions and often involve matters that are inherently unpredictable. We regularly evaluate these estimates based on historical experience, current business conditions, and other relevant factors, including inputs from third-party specialists where applicable. Our estimates are subject to change as new events occur, additional information becomes available, or operating environments evolve. Actual results could differ materially from those estimates, and such differences may have a material impact on our financial condition or results of operations. 50 Table of Contents We believe the following accounting policies involve significant judgment and estimates and are critical to an understanding our financial condition and results of operations: • Revenue recognition • Stock-based compensation • Income taxes These estimates are discussed further in Note 1. Organization and Summary of Significant Accounting Policies to our Consolidated Financial Statements included elsewhere in the Annual Report on Form 10-K. Revenue Recognition We recognize revenue from contracts with customers in accordance with ASC 606. We determine the appropriate amount of revenue to be recognized by applying the five-step model: (i) identifying the contract with customer, (ii) identifying the performance obligations in the contract, (iii) determining the transaction price, (iv) allocating the transaction price to the performance obligations, and (v) recognizing revenue when, or as, the performance obligations are satisfied. Our revenue is primarily usage-based and derived from fees calculated as a percentage of premiums written by our insurance customers. The nature of our usage based arrangements and related judgments did not change materially during the periods presented. We allocate the transaction price to performance obligations based on their relative standalone selling prices. For most performance obligations, we estimate standalone selling prices using an expected cost-plus-margin approach, which requires significant judgment regarding forecasted fulfillment costs and appropriate market-based margins. Changes in these estimates, including changes in product or service mix, or revisions to our assessment of the market-based margins, could affect the standalone selling prices used to allocated consideration in new or renewal of current contracts and thus result in the impact of the amount and timing of revenue recognized for each performance obligation. Our approach to determining standalone selling prices, including the underlying assumptions regarding fulfillment costs forecasts and margin estimates, remained consistent and did not change materially over the periods presented. Because our fees are generally usage-based and tied to the underlying insurance policies written by our customers, the transaction price often includes variable consideration. While our customer contracts typically span multiple years, the underlying insurance polices can be cancelled by policyholders without penalty. As a result, the uncertainty related to underlying policy volume, not termination of the MGA or customer agreement itself, drives our application of the ASC 606 constraint. We therefore constrain variable consideration to the amounts that are not probable of significant reversal. This assessment requires judgment and involves assumption about policyholder behavior, seasonality, expected policy retention, and inherent volatility of premiums written. We update these estimates quarterly based on the most recent available information. The assumptions used to evaluate and constrain variable consideration, including expected volume and retention behavior, were applied consistently and did not change materially during the periods presented. Stock-Based Compensation We account for stock-based compensation awards under our stockholder-approved incentive plans in accordance with the fair value recognition provisions of GAAP, recognizing expense based on grant-date fair value over the requisite service period. Our stock-based awards primarily consist of restricted stock awards and stock options with service based or market based vesting conditions. Restricted stock awards are granted with either time-based or market based vesting conditions tied to our stock price (e.g., share price thresholds sustained over a defined period). and are expensed over the requisite service period based on grant-date fair value. For awards with market conditions, the grant-date fair value incorporates the probability of achieving the market condition and is not subsequently adjusted. For stock options, we determine grant-date fair value using a Monte Carlo simulation technique and other option pricing models. These methods estimate the fair value of the option by modeling a range of potential future stock prices and associated outcomes and rely on assumptions such as expected volatility, risk-free interest rates, expected term, and dividend yield. These assumptions require significant judgment and can materially impact recognized compensation expense. For awards granted while we were a private company, we determined the fair value of our common stock using third-party valuations under IRC Section 409A. These valuations incorporated assumptions regarding future performance, market conditions, and comparable company data. Inputs such as estimated stock price and expected price volatility used in these valuation methods were derived from analyses of public peer companies with similar characteristics. For awards granted after our IPO, the grant-date fair value of our common stock is based on the quoted market price of our common stock on the date of grant. 51 Table of Contents Income Taxes We account for income taxes in accordance with GAAP, resulting in two components of income tax expense (benefit): current and deferred. The current income tax expense (benefit) reflects taxes payable or refundable for the current period by applying the provisions of the enacted tax law to the taxable income or excess of deductions over revenues. The realizability of deferred tax assets is evaluated quarterly, and judgment is required in assessing both positive and negative evidence, including recent financial performance, forecasted future earnings, and relevant tax planning strategies. As a member of a consolidated U.S. federal income tax return with HCI, we are subject to the group's tax-sharing arrangements. Our estimate of tax expense is sensitive to changes in the effective rate applied to its standalone results, which may differ from statutory rates due to business mix or transaction-related effects. JOBS Act We are an EGC as defined under the JOBS Act. As an EGC, we may delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to not take advantage of the extended transition period that allows an EGC to delay the adoption of certain accounting standards until those standards would otherwise apply to private companies, which means that the financial statements included in this Annual Report on Form 10-K, as well as financial statements we file in the future, will be subject to all new or revised accounting standards generally applicable to public companies. Our election not to take advantage of the extended transition period is irrevocable. We will remain an EGC until the earliest to occur of the following: (i) the last day of the fiscal year in which our total annual gross revenues first meet or exceed at least $1.235 billion (as adjusted for inflation), (ii) the date on which we have, during the prior three-year period, issued more than $1.0 billion in non-convertible debt, (iii) the last day of the fiscal year in which we (a) have an aggregate worldwide market value of common stock held by non-affiliates of $700 million or more (measured at the end of each fiscal year) as of the last business day of our most recently completed second fiscal quarter and (b) have been a reporting company under the Exchange Act for at least one year (and have filed at least one annual report under the Exchange Act), or (iv) the last day of the fiscal year following the fifth anniversary of the date of the first sale of our common stock pursuant to an effective registration statement under the Securities Act.