Baldwin Insurance Group, Inc.

Previous wording

We represent over three million clients across the United States and internationally. Our team comprises approximately 5,000 colleagues—including those who joined us through our January 2026 partnerships. Among them are approximately 800 risk advisors, who are fiercely independent, relentlessly competitive and “insurance geeks.” We have approximately 120 offices in 25 states, all of which are equipped to provide diversified products and services to empower our clients at every stage through our three operating groups.

Current wording

We represent over three million clients across the United States and internationally. Our team comprises approximately 5,000 colleagues—including those who joined us through our January 2026 partnerships. Among them are approximately 700 risk advisors, who are fiercely independent, relentlessly competitive and “insurance geeks.” We have approximately 115 offices in 23 states, all of which are equipped to provide diversified products and services to empower our clients at every stage through our three operating groups.

Previous wording

•Underwriting, Capacity & Technology Solutions (“UCTS”) consists of three distinct divisions—MSI, our Capacity Solutions group (which includes our reinsurance brokerage business, Juniper Re; our reinsurance MGA business, MultiStrat; and our captive management business), and the Captive business. Through MSI, we manufacture proprietary, technology-enabled insurance products that are then distributed (in many instances via technology and/or API integrations) internally via our risk advisors across our other operating groups and externally via select distribution partners, with a focus on sheltered channels where our products deliver speed, ease of use and certainty of execution. An example of this is our national embedded renters insurance product sold at point of lease via integrations with property management software providers. As a prominent growth driver for the Company, we have invested heavily in the expansion of our MGA product suite, which is now comprised of more than 20 products across commercial, personal and professional lines.

Current wording

•Underwriting, Capacity & Technology Solutions (“UCTS”) consists of three distinct divisions—MSI, our Capacity Solutions group (which includes our reinsurance brokerage business, Juniper Re; our reinsurance MGA business, MultiStrat; and our captive management business), and the Captive business. Through MSI, we manufacture proprietary, technology-enabled insurance products that are then distributed (in many instances via technology and/or API integrations) internally via our risk advisors across our other operating groups and externally via select distribution partners, with a focus on sheltered channels where our products deliver speed, ease of use and certainty of execution. An example of this is our national embedded renters insurance product sold at point of lease via integrations with property management software providers. As a prominent growth driver for the Company, we have invested heavily in the expansion of our MGA product suite, which comprises more than 20 products across commercial, personal and professional lines.

Previous wording

We completed three partnerships for an aggregate purchase price of $1.6 billion during the six months ended June 30, 2026 as discussed further below. The operating results of these partnerships have been included in the condensed consolidated statements of comprehensive income (loss) from their respective acquisition dates.

Current wording

We completed five partnerships for an aggregate purchase price of $1.6 billion during the nine months ended September 30, 2026. Three of the partnerships were accounted for as business combinations and are discussed further below. The operating results of these partnerships have been included in the condensed consolidated statements of comprehensive loss from their respective acquisition dates.

Previous wording

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our condensed consolidated financial statements for the six months ended June 30, 2026 and 2025 and the related notes and other financial information included elsewhere in this report.

Current wording

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our condensed consolidated financial statements for the nine months ended September 30, 2026 and 2025 and the related notes and other financial information included elsewhere in this report.

Previous wording

The following is a discussion of our consolidated results of operations for the three and six months ended June 30, 2026 and 2025. Consolidated results of operations for the three and six months ended June 30, 2026 include the results of the CAC Group, Capstone and Obie partnerships from their respective acquisition dates.

Current wording

The following is a discussion of our consolidated results of operations for the three and nine months ended September 30, 2026 and 2025. Consolidated results of operations for the three and nine months ended September 30, 2026 include the results of the CAC Group, Capstone and Obie partnerships from their respective acquisition dates.

Previous wording

Commissions and fees increased $112.5 million, or 30%, for the quarter ended June 30, 2026 compared to the same period of 2025, driven by commissions and fees contributed by partnership activity of $106.8 million and organic growth in profit-sharing and other revenue of $6.0 million, offset in part by lower organic core commissions and fees of $0.3 million.

Current wording

Commissions and fees increased $113.2 million, or 31%, for the quarter ended September 30, 2026 compared to the same period of 2025, driven by commissions and fees contributed by partnership activity of $91.7 million and organic growth in core commissions and fees of $24.5 million, offset in part by a decline in organic profit-sharing and other revenue of $3.0 million.

Previous wording

Commissions and fees increased $230.9 million, or 29%, for the year-to-date period ended June 30, 2026 compared to the same period of 2025, driven by commissions and fees contributed by partnership activity of $218.2 million, organic growth in core commissions and fees of $11.0 million and organic profit-sharing and other revenue of $1.6 million.

Current wording

Commissions and fees increased $344.1 million, or 30%, for the year-to-date period ended September 30, 2026 compared to the same period of 2025, driven by commissions and fees contributed by partnership activity of $309.9 million and organic growth in core commissions and fees of $35.5 million, offset in part by a decline in organic profit-sharing and other revenue of $1.4 million.

Previous wording

Colleague compensation and benefits is our largest expense. It consists of (i) base compensation comprising salary, bonuses and benefits paid and payable to colleagues, and commissions paid to colleagues, and (ii) equity-based compensation associated with the grants of restricted and unrestricted stock awards to senior management, colleagues, risk advisors and directors. We expect to continue to experience a general rise in colleague compensation and benefits expense commensurate with expected revenue growth as our compensation arrangements with our colleagues and risk advisors contain significant bonus or commission components driven by the results of our operations. In addition, we operate in competitive markets for human capital and need to maintain competitive compensation levels as we expand geographically and create new products and services.

Current wording

Colleague compensation and benefits is our largest expense. It consists of (i) base compensation comprising salary, bonuses and benefits paid and payable to colleagues, and commissions paid to colleagues, and (ii) equity-based compensation associated with the grants of restricted and unrestricted stock awards to senior management, colleagues, risk advisors and directors. We operate in competitive labor markets and must maintain competitive compensation and benefits as we expand geographically, develop new products and services, and navigate inflationary pressures. We expect these factors to be partially offset by role transformation and the benefits of our $3B/30 Catalyst Program, including automation, business process optimization, and artificial intelligence initiatives that directly impact colleague compensation.

Previous wording

Colleague compensation and benefits expense for IAS increased $62.9 million for the quarter ended June 30, 2026 compared to the same period of 2025, primarily due to partnership activity, which contributed $64.1 million to the increase in colleague compensation and benefits. After excluding partnership activity, colleague compensation and benefits expense decreased $1.3 million driven by lower temporary help and performance bonuses, offset in part by elevated health plan costs and higher severance.

Current wording

Colleague compensation and benefits expense increased $62.8 million, or 33%, for the quarter ended September 30, 2026 compared to the same period of 2025. Partnership activity contributed $64.1 million to the increase in colleague compensation and benefits. After excluding partnership activity, colleague compensation and benefits decreased $1.4 million, driven by lower colleague compensation of $4.8 million related to benefits from our $3B/30 Catalyst Program and inside advisor commissions of $1.9 million, offset in part by higher performance bonuses of $3.4 million and elevated health plan costs of $1.4 million.

Previous wording

Colleague compensation and benefits expense increased $154.4 million, or 39%, for the year-to-date period ended June 30, 2026 compared to the same period of 2025. Partnership activity contributed $139.9 million to the increase in colleague compensation and benefits. After excluding partnership activity, colleague compensation and benefits increased $14.6 million, primarily resulting from elevated health plan costs of $7.3 million, increased colleague compensation of $6.2 million and inside advisor commissions of $3.9 million related to the overall growth of the business, and higher severance of $3.1 million, offset in part by lower temporary help and performance bonuses of $7.8 million.

Current wording

Colleague compensation and benefits expense increased $217.2 million, or 37%, for the year-to-date period ended September 30, 2026 compared to the same period of 2025. Partnership activity contributed $204.1 million to the increase in colleague compensation and benefits. After excluding partnership activity, colleague compensation and benefits increased $13.1 million, primarily resulting from elevated health plan costs of $8.6 million, higher costs relating to severance of $3.4 million, inside advisor commissions of $1.7 million and colleague compensation of $1.6 million from the overall growth of the business, offset in part by lower temporary help of $3.6 million.

Previous wording

Other operating expenses increased $37.9 million for the quarter ended June 30, 2026 compared to the same period of 2025. Partnership activity contributed $16.4 million to the increase in other operating expenses. After excluding partnership activity, other operating expenses increased $21.6 million, driven by higher professional fees of $10.1 million due to increased legal spend, higher Captive‑related operating expenses of $7.6 million, and higher technology and software-related costs of $3.2 million.

Current wording

Other operating expenses increased $55.4 million for the quarter ended September 30, 2026 compared to the same period of 2025. Partnership activity contributed $13.6 million to the increase in other operating expenses. After excluding partnership activity, other operating expenses increased $41.8 million, driven by higher professional fees of $25.2 million due to increased legal spend primarily relating to the Go-Private Transaction, higher Captive-related operating expenses of $7.0 million, technology and software-related costs of $2.2 million, legal settlement expense of $2.2 million, and licenses and taxes of $2.0 million from the growth in UCTS.

Previous wording

Other operating expenses increased $204.1 million for the year-to-date period ended June 30, 2026 compared to the same period of 2025. Partnership activity contributed $32.6 million to the increase in other operating expenses. After excluding partnership activity, other operating expenses increased $171.5 million, driven by $128.8 million of additional Tax Receivable Agreement expense during 2026, $16.5 million of higher Captive‑related operating expenses, $14.9 million of higher professional fees due to increased legal spend, $7.7 million of transaction-related insurance premiums incurred in connection with the CAC Group partnership, and $6.0 million of higher technology and software-related cost. The increase in Tax Receivable Agreement expense relates to the recognition of a liability associated with expected future payments under the agreement. Historically, such amounts were not recorded as we did not expect to realize sufficient cash tax benefits. During the period, changes in our tax profile, including the recognition of deferred tax liabilities, resulted in management concluding that a significant portion of the tax benefits associated with prior exchanges is expected to be realized. Accordingly, we recorded a liability representing our estimated obligation to share such realized tax benefits with Baldwin Holdings’ LLC Members. This amount was recorded to other operating expense as it reflects the recognition of previously unrecorded obligations, while future amounts arising from new redemptions or exchanges will be recorded through stockholders’ equity and subsequent changes in any of our estimates after the date of the redemption or exchange, as well as any interest accrued on the Tax Receivable Agreement between our annual tax filing date and the Tax Receivable Agreement payment date, will be recognized in the condensed consolidated statements of comprehensive income (loss).

Current wording

Other operating expenses increased $259.5 million for the year-to-date period ended September 30, 2026 compared to the same period of 2025. Partnership activity contributed $46.2 million to the increase in other operating expenses. After excluding partnership activity, other operating expenses increased $213.3 million, driven by $128.8 million of additional Tax Receivable Agreement expense during 2026, $40.2 million of professional fees due to the Go-Private Transaction and other increased legal spend, $23.5 million of Captive-related operating expenses, $8.2 million of technology and software-related cost, and $7.7 million of transaction-related insurance premiums incurred in connection with the CAC Group partnership. The increase in Tax Receivable Agreement expense relates to the recognition of a liability associated with expected future payments under the agreement. Historically, such amounts were not recorded as we did not expect to realize sufficient cash tax benefits. During the period, changes in our tax profile, including the recognition of deferred tax liabilities, resulted in management concluding that a significant portion of the tax benefits associated with prior exchanges is expected to be realized. Accordingly, we recorded a liability representing our estimated obligation to share such realized tax benefits with LLC Members. This amount was recorded to other operating expense as it reflects the recognition of previously unrecorded obligations, while future amounts arising from new redemptions or exchanges will be recorded through stockholders’ equity and subsequent changes in any of our estimates after the date of the redemption or exchange, as well as any interest accrued on the Tax Receivable Agreement between our annual tax filing date and the Tax Receivable Agreement payment date, will be recognized in the condensed consolidated statements of comprehensive loss.

Previous wording

Amortization expense increased $30.0 million and $59.2 million for the quarter and year-to-date periods ended June 30, 2026 compared to the same periods of 2025, respectively, driven primarily by the impact of intangible assets recognized in connection with recent partnerships, including those completed in 2025 that are not reflected in our results for the comparative period. The increase also reflects higher amortization of internally developed software placed into service over the past year.

Current wording

Amortization expense increased $26.0 million and $85.2 million for the quarter and year-to-date periods ended September 30, 2026 compared to the same periods of 2025, respectively, driven primarily by the impact of intangible assets recognized in connection with recent partnerships, including those completed in 2025 that are not reflected in our results for the full comparative period. The increase also reflects higher amortization of internally developed software placed into service over the past year.

Previous wording

The change in fair value of contingent consideration was a $12.3 million loss for the quarter ended June 30, 2026 compared to a $2.0 million gain for the same period of 2025, and a $14.3 million loss for the year-to-date period ended June 30, 2026 compared to a $6.1 million loss for the same period of 2025. The fair value losses for the quarter and year-to-date periods of 2026 reflect improved projected operating performance for certain acquired businesses, which increased the estimated earnout obligations, in addition to accretion of certain contingent earnout obligations approaching their respective measurement dates.

Current wording

The change in fair value of contingent consideration was a $17.6 million loss for the quarter ended September 30, 2026 compared to a $2.0 million loss for the same period of 2025, and a $31.9 million loss for the year-to-date period ended September 30, 2026 compared to an $8.1 million loss for the same period of 2025. The fair value losses for the quarter and year-to-date periods of 2026 reflect improved projected operating performance for certain acquired businesses, which increased the estimated earnout obligations, in addition to accretion of certain contingent earnout obligations approaching their respective measurement dates, offset in part by an increase in interest rates. In addition, the change in fair value of contingent consideration relating to the CAC Group partnership includes an assumption for acceleration due to a likely change in control associated with the potential consummation of the Go-Private Transaction.

Previous wording

Interest expense, net, increased $14.3 million and $23.3 million for the quarter and year-to-date periods ended June 30, 2026 compared to the same periods of 2025, respectively, resulting from higher average borrowings, offset in part by a lower average interest rate. We expect interest expense to grow in the near term on a year-over-year basis due to higher borrowings under the JPM Credit Facility to fund partnership opportunities and the settlement of deferred payment obligations, offset slightly by lower expected interest rates.

Current wording

Interest expense, net, increased $11.8 million and $35.0 million for the quarter and year-to-date periods ended September 30, 2026 compared to the same periods of 2025, respectively, resulting from higher average borrowings, offset in part by a lower average interest rate. We expect interest expense to grow in the near term on a year-over-year basis due to higher borrowings under the JPM Credit Facility to fund partnership opportunities and the settlement of deferred payment obligations.

Previous wording

Losses on extinguishment and modification of debt of $7.5 million for the first half of 2026 and $2.4 million for the same period of 2025 relate to debt refinancing transactions completed during those periods.

Current wording

Losses on extinguishment and modification of debt of $7.4 million for the year-to-date period of 2026 and $5.7 million for the same period of 2025 relate to debt refinancing transactions completed during those periods.

Previous wording

We recognized an income tax benefit of$144.4 million for the six months ended June 30, 2026 related to the CAC Group and Obie partnerships completed on January 1, 2026 and January 2, 2026, respectively. In connection with these partnerships, we recognized $142.2 million of deferred tax liabilities associated with acquired intangible assets, providing an additional source of future taxable income. This prompted a reassessment of the realizability of our deferred tax assets from which we concluded that sufficient positive evidence existed to support the realizability of the majority of those assets. As a result, we released a significant portion of our related valuation allowance and recognized an income tax benefit. The income tax benefit was partially offset by the change in deferred tax liabilities recognized in connection with the CAC Group and Obie partnerships. The valuation allowance release also caused a shift in our overall position from a net deferred tax asset to a net deferred tax liability.

Current wording

We recognized an income tax benefit of$147.0 million for the year-to-date period ended September 30, 2026 related to the CAC Group and Obie partnerships completed in January 2026. In connection with these partnerships, we recognized $142.2 million of deferred tax liabilities associated with acquired intangible assets, providing an additional source of future taxable income. This prompted a reassessment of the realizability of our deferred tax assets from which we concluded that sufficient positive evidence existed to support the realizability of the majority of those assets. As a result, we released a significant portion of our related valuation allowance and recognized an income tax benefit. The income tax benefit was partially offset by the change in deferred tax liabilities recognized in connection with the CAC Group and Obie partnerships. The valuation allowance release also caused a shift in our overall position from a net deferred tax asset to a net deferred tax liability.

Previous wording

Adjusted EBITDA, adjusted EBITDA margin, organic revenue, organic revenue growth, adjusted net income and adjusted diluted earnings per share (“EPS”), are not measures of financial performance under GAAP and should not be considered substitutes for GAAP measures, including commissions and fees (for organic revenue and organic revenue growth), net income (loss) (for adjusted EBITDA and adjusted EBITDA margin), net income (loss) attributable to Baldwin (for adjusted net income) or diluted earnings (loss) per share (for adjusted diluted EPS), which we consider to be the most directly comparable GAAP measures. These non-GAAP financial measures have limitations as analytical tools, and when assessing our operating performance, you should not consider these non-GAAP financial measures in isolation or as substitutes for commissions and fees, net income (loss), net income (loss) attributable to Baldwin, diluted earnings (loss) per share or other consolidated income statement data prepared in accordance with GAAP. Other companies in our industry may define or calculate these non-GAAP financial measures differently than we do, and accordingly, these measures may not be comparable to similarly titled measures used by other companies.

Current wording

Organic revenue, organic revenue growth, adjusted EBITDA, adjusted EBITDA margin, adjusted net income and adjusted diluted earnings per share (“EPS”) are not measures of financial performance under GAAP and should not be considered substitutes for GAAP measures, including commissions and fees (for organic revenue and organic revenue growth), net income (loss) (for adjusted EBITDA and adjusted EBITDA margin), net income (loss) attributable to Baldwin (for adjusted net income) or diluted earnings (loss) per share (for adjusted diluted EPS), which we consider to be the most directly comparable GAAP measures. These non-GAAP financial measures have limitations as analytical tools, and when assessing our operating performance, you should not consider these non-GAAP financial measures in isolation or as substitutes for commissions and fees, net income (loss), net income (loss) attributable to Baldwin, diluted earnings (loss) per share or other consolidated income statement data prepared in accordance with GAAP. Other companies in our industry may define or calculate these non-GAAP financial measures differently than we do, and accordingly, these measures may not be comparable to similarly titled measures used by other companies.

Previous wording

Adjusted EBITDA margin is calculated as adjusted EBITDA divided by total revenue. Adjusted EBITDA margin is a key metric used by management and our board of directors to assess our financial performance. We believe that adjusted EBITDA margin is an appropriate measure of operating performance because it eliminates the impact of income and expenses that do not relate to business performance, and that the presentation of this measure enhances an investor’s understanding of our financial performance. We believe that adjusted EBITDA margin is helpful in measuring profitability of operations on a consolidated level.

Current wording

Adjusted EBITDA margin is calculated as adjusted EBITDA divided by total revenues. Adjusted EBITDA margin is a key metric used by management and our board of directors to assess our financial performance. We believe that adjusted EBITDA margin is an appropriate measure of operating performance because it eliminates the impact of income and expenses that do not relate to business performance, and that the presentation of this measure enhances an investor’s understanding of our financial performance. We believe that adjusted EBITDA margin is helpful in measuring profitability of operations on a consolidated level.

Previous wording

We define adjusted net income as net income (loss) attributable to Baldwin adjusted for depreciation, amortization, change in fair value of contingent consideration and certain items of income and expense, including share-based compensation expense, transaction-related partnership and integration expenses, transformation costs, severance, and certain non-recurring costs that, in the opinion of management, significantly affect the period-over-period assessment of operating results, and the related tax effect of those adjustments. We believe that adjusted net income is an appropriate measure of operating performance because it eliminates the impact of income and expenses that do not relate to business performance.

Current wording

We define adjusted net income as net income (loss) attributable to Baldwin adjusted for depreciation, amortization, change in fair value of contingent consideration and certain items of income and expense, including share-based compensation expense, transaction-related partnership and integration expenses, transformation costs, severance, and certain non-recurring items that, in the opinion of management, significantly affect the period-over-period assessment of operating results, and the related tax effect of those adjustments. We believe that adjusted net income is an appropriate measure of operating performance because it eliminates the impact of income and expenses that do not relate to business performance.

Previous wording

(2)Organic revenue for the three and six months ended June 30, 2025 used to calculate organic revenue growth for the three and six months ended June 30, 2026 was $376.3 million and $786.8 million, respectively, which is adjusted to exclude commissions and fees from divestitures that occurred during 2025.

Current wording

(2)Organic revenue for the three and nine months ended September 30, 2025 used to calculate organic revenue growth for the three and nine months ended September 30, 2026 was $362.3 million and $1.149 billion, respectively, which is adjusted to exclude commissions and fees from divestitures that occurred during 2025 and 2026.

Previous wording

The following table reconciles adjusted EBITDA and adjusted EBITDA margin to net income (loss), which we consider to be the most directly comparable GAAP financial measure:

Current wording

The following table reconciles adjusted EBITDA and adjusted EBITDA margin to net loss, which we consider to be the most directly comparable GAAP financial measure:

Previous wording

The following table reconciles adjusted net income to net income (loss) attributable to Baldwin and reconciles adjusted diluted EPS to diluted earnings (loss) per share, which we consider to be the most directly comparable GAAP financial measures:

Current wording

The following table reconciles adjusted net income to net loss attributable to Baldwin and reconciles adjusted diluted EPS to diluted loss per share, which we consider to be the most directly comparable GAAP financial measures:

Previous wording

IAS results of operations for the three and six months ended June 30, 2026 include the results of the CAC Group and Capstone partnerships.

Current wording

IAS results of operations for the three and nine months ended September 30, 2026 include the results of the CAC Group and Capstone partnerships.

Previous wording

IAS commissions and fees increased $90.5 million, or 50%, for the quarter ended June 30, 2026 compared to the same period of 2025, primarily due to the partnership contribution of $94.1 million. Organic growth was pressured by a 240 bps headwind in underlying rate and exposure during the current period resulting from continued rate softness, notably in commercial property lines. Core commissions and fees benefited from 19% sales velocity (new business as a percentage of prior year commissions and fees) for legacy Baldwin, which compared to 22% in the prior-year period. Combined sales velocity including the 2026 partnerships was 30% for the second quarter of 2026.

Current wording

IAS commissions and fees increased $288.5 million, or 51%, for the year-to-date period ended September 30, 2026 compared to the same period of 2025, primarily due to the partnership contribution of $272.4 million. Core commissions and fees benefited from 19% sales velocity and an uptick in construction project work. Organic growth was pressured by a 90 bps headwind in underlying rate and exposure during the current period resulting from continued rate softness, notably in commercial property lines.

Previous wording

Colleague compensation and benefits expense for MIS increased $2.4 million for the quarter ended June 30, 2026 compared to the same period of 2025. Partnership activity contributed $1.1 million to the increase in colleague compensation and benefits. After excluding partnership activity, colleague compensation and benefits increased $1.3 million primarily due to elevated health plan costs and higher severance.

Current wording

Colleague compensation and benefits expense for IAS increased $197.5 million for the year-to-date period ended September 30, 2026 compared to the same period of 2025, primarily due to partnership activity, which contributed $186.1 million to the increase in colleague compensation and benefits. After excluding partnership activity, colleague compensation and benefits expense increased $11.4 million, primarily due to elevated health plan costs of $4.9 million, higher inside advisor commissions of $2.7 million driven by growth, severance of $1.8 million and performance bonuses of $1.2 million.

Previous wording

Other operating expenses for IAS increased $38.0 million for the year-to-date period ended June 30, 2026 compared to the same period of 2025, primarily due to partnership activity, which contributed $28.4 million to the increase in other operating expenses. After excluding partnership activity, other operating expenses increased $9.6 million, primarily due to higher professional fees of $6.5 million from increased legal spend and higher technology and software-related costs of $3.5 million.

Current wording

Other operating expenses for IAS increased $53.3 million for the year-to-date period ended September 30, 2026 compared to the same period of 2025, primarily due to partnership activity, which contributed $40.1 million to the increase in other operating expenses. After excluding partnership activity, other operating expenses increased $13.2 million, primarily due to higher professional fees of $6.5 million from increased legal spend, technology and software-related costs of $4.7 million and travel and entertainment expense of $2.1 million.

Previous wording

Amortization expense for IAS increased $18.5 million and $36.4 million for the quarter and year-to-date periods ended June 30, 2026 compared to the same periods of 2025, respectively, primarily due to the impact of intangible assets recognized in connection with partnership activity in the first quarter of 2026.

Current wording

IAS amortization expense increased $18.4 million and $54.8 million for the quarter and year-to-date periods ended September 30, 2026 compared to the same periods of 2025, respectively, primarily due to the impact of intangible assets recognized in connection with partnership activity in the first quarter of 2026.

Previous wording

The change in fair value of contingent consideration for IAS was a $5.1 million loss for the quarter ended June 30, 2026 compared to a $0.5 million gain for the same period of 2025, and a $5.4 million loss for the year-to-date period ended June 30, 2026 compared to a $6.7 million loss for the same period of 2025. The fair value losses for the quarter and year-to-date periods of 2026 reflect improved projected operating performance for certain acquired businesses, which increased the estimated earnout obligations, in addition to accretion of certain contingent earnout obligations approaching their respective measurement dates.

Current wording

The change in fair value of contingent consideration for IAS was a $16.4 million loss for the quarter ended September 30, 2026 compared to a $1.5 million loss for the same period of 2025, and a $21.8 million loss for the year-to-date period ended September 30, 2026 compared to an $8.2 million loss for the same period of 2025. The fair value losses for the quarter and year-to-date periods of 2026 reflect improved projected operating performance for certain acquired businesses, which increased the estimated earnout obligations, in addition to accretion of certain contingent earnout obligations approaching their respective measurement dates, offset in part by an increase in interest rates. In addition, the change in fair value of contingent consideration relating to the CAC Group partnership includes an assumption for acceleration due to a likely change in control associated with the potential consummation of the Go-Private Transaction.

Previous wording

UCTS consists of three distinct divisions—MSI, our Capacity Solutions group (which includes our reinsurance brokerage business, Juniper Re; our reinsurance MGA business, MultiStrat; and our captive management business), and the Captive business. Through MSI, we manufacture proprietary, technology-enabled insurance products with a focus on sheltered channels where our products deliver speed, ease of use and certainty of execution, an example of which is our national embedded renters insurance product sold at point of lease via integrations with property management software providers. Our MGA product suite is now comprised of more than 20 products across personal, commercial and professional lines.

Current wording

UCTS consists of three distinct divisions—MSI, our Capacity Solutions group (which includes our reinsurance brokerage business, Juniper Re; our reinsurance MGA business, MultiStrat; and our captive management business), and the Captive business. Through MSI, we manufacture proprietary, technology-enabled insurance products with a focus on sheltered channels where our products deliver speed, ease of use and certainty of execution, an example of which is our national embedded renters insurance product sold at point of lease via integrations with property management software providers. Our MGA product suite comprises more than 20 products across personal, commercial and professional lines.

Previous wording

UCTS results of operations for the three and six months ended June 30, 2026 include the results of the Obie partnership.

Current wording

UCTS results of operations for the three and nine months ended September 30, 2026 include the results of the Obie partnership.

Previous wording

UCTS commissions and fees increased $12.4 million, or 9%, for the quarter ended June 30, 2026 compared to the same period of 2025, primarily due to total growth in core commissions and fees of $9.8 million, which includes the partnership contribution of $5.7 million. Organic growth in core commissions and fees includes $9.8 million from the Captive, offset in part by a $4.5 million reduction in our Capacity Solutions group and a $0.6 million reduction in MSI. In addition, profit sharing and other increased $2.7 million year over year.

Current wording

UCTS commissions and fees increased $18.5 million, or 13%, for the quarter ended September 30, 2026 compared to the same period of 2025, primarily due to total growth in core commissions and fees of $18.4 million, which includes the partnership contribution of $6.9 million. Organic growth in core commissions and fees includes $9.4 million from the Captive and $3.6 million from MSI, offset in part by a $2.8 million reduction in our Capacity Solutions group.

Previous wording

UCTS commissions and fees increased $21.9 million, or 8%, for the year-to-date period ended June 30, 2026 compared to the same period of 2025, primarily due to total growth in core commissions and fees of $21.8 million, which includes the partnership contribution of $14.5 million. Organic growth in core commissions and fees includes $19.7 million from the Captive, offset in part by a $6.3 million reduction in MSI primarily driven by weakness in our E&S home programs as a result of the current property rate environment, and a $3.1 million reduction in our Capacity Solutions group.

Current wording

UCTS commissions and fees increased $40.5 million, or 10%, for the year-to-date period ended September 30, 2026 compared to the same period of 2025, primarily due to total growth in core commissions and fees of $40.1 million, which includes the partnership contribution of $21.4 million. Organic growth in core commissions and fees includes $29.1 million from the Captive, offset in part by a $5.9 million reduction in our Capacity Solutions group and a $2.7 million reduction in MSI primarily driven by weakness in our E&S home programs as a result of the current property rate environment.

Previous wording

Colleague compensation and benefits expense for UCTS increased $4.5 million for the quarter ended June 30, 2026 compared to the same period of 2025, primarily due to partnership activity, which contributed $4.6 million to the increase in colleague compensation and benefits. After excluding partnership activity, colleague compensation and benefits decreased $0.1 million, driven by lower temporary help, offset in part by higher colleague compensation relating to growth in UCTS and elevated health plan costs.

Current wording

Colleague compensation and benefits expense for UCTS increased $5.5 million for the quarter ended September 30, 2026 compared to the same period of 2025, primarily due to partnership activity, which contributed $4.4 million to the increase in colleague compensation and benefits. After excluding partnership activity, colleague compensation and benefits increased $1.1 million, driven by higher colleague compensation of $0.8 million from the growth in UCTS, and elevated health plan costs of $0.4 million.

Previous wording

Colleague compensation and benefits expense for UCTS increased $13.7 million for the year-to-date period ended June 30, 2026 compared to the same period of 2025, primarily due to partnership activity, which contributed $11.2 million to the increase in colleague compensation and benefits. After excluding partnership activity, colleague compensation and benefits increased $2.5 million, driven by higher colleague compensation of $4.3 million relating to growth in UCTS and elevated health plan costs of $1.3 million, offset in part by lower temporary help of $2.6 million.

Current wording

Colleague compensation and benefits expense for UCTS increased $19.2 million for the year-to-date period ended September 30, 2026 compared to the same period of 2025, primarily due to partnership activity, which contributed $15.6 million to the increase in colleague compensation and benefits. After excluding partnership activity, colleague compensation and benefits increased $3.5 million, driven by higher colleague compensation of $5.1 million from the growth in UCTS, and elevated health plan costs of $1.6 million, offset in part by lower temporary help of $2.6 million.

Previous wording

Outside commissions for UCTS decreased $4.2 million and $7.6 million for the quarter and year-to-date periods ended June 30, 2026 compared to the same periods of 2025, respectively. Partnership activity contributed $4.4 million and $8.6 million to outside commissions for the quarter and year-to-date periods, respectively. After excluding partnership activity, outside commissions decreased $8.6 million and $16.2 million for the quarter and year-to-date periods, respectively. Outside commissions fluctuated at a lower rate than core commissions and fees reflecting continued benefits from scale, a shift in product mix, and increased contributions from the Capacity Solutions group (which generally does not have significant outside commissions).

Current wording

Outside commissions for UCTS decreased $3.0 million and $10.5 million for the quarter and year-to-date periods ended September 30, 2026 compared to the same periods of 2025, respectively. Partnership activity contributed $5.0 million and $13.6 million to outside commissions for the quarter and year-to-date periods, respectively. After excluding partnership activity, outside commissions decreased $8.0 million and $24.2 million for the quarter and year-to-date periods, respectively. Outside commissions fluctuated at a lower rate than core commissions and fees reflecting continued benefits from scale, a shift in product mix, and increased contributions from the non-MSI business (which generally does not have significant outside commissions).

Previous wording

Other operating expenses for UCTS increased $17.3 million for the quarter ended June 30, 2026 compared to the same period of 2025. Partnership activity contributed $1.7 million to the increase in other operating expenses. After excluding partnership activity, other operating expenses increased $15.6 million, driven primarily by higher Captive‑related operating expenses of $7.6 million, professional fees of $3.1 million from increased legal spend, and technology and software-related costs of $2.6 million.

Current wording

Other operating expenses for UCTS increased $16.1 million for the quarter ended September 30, 2026 compared to the same period of 2025. Partnership activity contributed $1.9 million to the increase in other operating expenses. After excluding partnership activity, other operating expenses increased $14.2 million, driven primarily by higher Captive-related operating expenses of $7.0 million, licenses and taxes of $2.4 million, professional fees of $2.3 million from increased legal spend, and technology and software-related costs of $1.2 million.

Previous wording

Other operating expenses for UCTS increased $30.8 million for the year-to-date period ended June 30, 2026 compared to the same period of 2025. Partnership activity contributed $4.2 million to the increase in other operating expenses. After excluding partnership activity, other operating expenses increased $26.6 million, driven primarily by higher Captive‑related operating expenses of $16.5 million, professional fees of $5.0 million from increased legal spend, and technology and software-related costs of $3.8 million.

Current wording

Other operating expenses for UCTS increased $47.0 million for the year-to-date period ended September 30, 2026 compared to the same period of 2025. Partnership activity contributed $6.1 million to the increase in other operating expenses. After excluding partnership activity, other operating expenses increased $40.8 million, driven primarily by higher Captive-related operating expenses of $23.5 million, professional fees of $7.3 million from increased legal spend, technology and software-related costs of $4.9 million and licenses and taxes of $1.8 million.

Previous wording

Amortization expense for UCTS increased $5.7 million and $11.3 million for the quarter and year-to-date periods ended June 30, 2026 compared to the same periods of 2025, respectively, primarily due to the impact of intangible assets recognized in connection with partnership activity in the first quarter of 2026, as well as higher amortization of internally developed software placed in service over the past year.

Current wording

UCTS amortization expense increased $5.4 million and $16.7 million for the quarter and year-to-date periods ended September 30, 2026 compared to the same periods of 2025, respectively, primarily due to the impact of intangible assets recognized in connection with partnership activity in the first quarter of 2026, as well as higher amortization of internally developed software placed in service over the past year.

Previous wording

The change in fair value of contingent consideration for UCTS was a $5.4 million loss for the quarter ended June 30, 2026 compared to a $1.6 million gain for the same period of 2025, and a $6.9 million loss for the year-to-date period ended June 30, 2026 compared to a $0.8 million gain for the same period of 2025. The fair value losses for the quarter and year-to-date periods of 2026 reflect improved projected operating performance for certain acquired businesses, which increased the estimated earnout obligations.

Current wording

The change in fair value of contingent consideration for UCTS was a $0.6 million gain for the quarter ended September 30, 2026 compared to a $0.4 million loss for the same period of 2025, and a $6.3 million loss for the year-to-date period ended September 30, 2026 compared to a $0.4 million gain for the same period of 2025. The fair value loss for the year-to-date period of 2026 reflects improved projected operating performance for certain acquired businesses, which increased the estimated earnout obligations.