Item 1. Financial Statements (Unaudited)

BROWN & BROWN, INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(UNAUDITED)

		Three months ended June 30,								Six months ended June 30,
(in millions, except per share data)		2025				2024				2025				2024
REVENUES
Commissions and fees		$	1,249			$	1,154			$	2,634			$	2,390
Investment and other income			36				24				55				45
Total revenues			1,285				1,178				2,689				2,435
EXPENSES
Employee compensation and benefits			640				585				1,323				1,216
Other operating expenses			211				173				398				334
(Gain)/loss on disposal			—				(31	)			1				(29	)
Amortization			50				44				103				86
Depreciation			11				11				23				21
Interest			51				49				96				97
Change in estimated acquisition earn-out payables			11				1				7				(2	)
Total expenses			974				832				1,951				1,723
Income before income taxes			311				346				738				712
Income taxes			77				87				169				159
Net income before non-controlling interests			234				259				569				553
Less: Net income attributable to non-controlling interests			3				2				6				3
Net income attributable to the Company		$	231			$	257			$	563			$	550
Net income per share:
Basic		$	0.79			$	0.90			$	1.94			$	1.93
Diluted		$	0.78			$	0.90			$	1.93			$	1.92

See accompanying Notes to Condensed Consolidated Financial Statements.

BROWN & BROWN, INC.

CONDENSED CONSOLIDATED STATE****MENTS OF COMPREHENSIVE INCOME

(UNAUDITED)

		Three months ended June 30,								Six months ended June 30,
(in millions)		2025				2024				2025				2024
Net income attributable to the Company		$	231			$	257			$	563			$	550
Foreign currency translation gain/(loss)			247				4				371				(28	)
Comprehensive income attributable to the Company		$	478			$	261			$	934			$	522

See accompanying Notes to Condensed Consolidated Financial Statements.

BROWN & BROWN, INC.

CONDENSED CONSOLIDATE****D BALANCE SHEETS

(UNAUDITED)

(in millions, except per share data)		June 30, 2025				December 31, 2024
ASSETS
Current Assets:
Cash and cash equivalents		$	8,893			$	675
Fiduciary cash			2,026				1,827
Commission, fees and other receivables			1,055				895
Fiduciary receivables			1,212				1,116
Reinsurance recoverable			385				1,527
Prepaid reinsurance premiums			529				520
Other current assets			343				364
Total current assets			14,443				6,924
Fixed assets, net			334				319
Operating lease assets			198				200
Goodwill			8,365				7,970
Amortizable intangible assets, net			1,866				1,814
Other assets			430				385
Total assets		$	25,636			$	17,612
LIABILITIES AND EQUITY
Current Liabilities:
Fiduciary liabilities		$	3,238			$	2,943
Losses and loss adjustment reserve			400				1,543
Unearned premiums			632				577
Accounts payable			382				373
Accrued expenses and other liabilities			530				653
Current portion of long-term debt			75				225
Total current liabilities			5,257				6,314
Long-term debt less unamortized discount and debt issuance costs			7,470				3,599
Operating lease liabilities			186				189
Deferred income taxes, net			721				711
Other liabilities			385				362
Equity:
Common stock, par value $0.10 per share; authorized 560 shares; issued 350 shares and outstanding 330 shares at 2025, issued 306shares and outstanding 286 shares at 2024, respectively			35				31
Additional paid-in capital			5,441				1,118
Treasury stock, at cost 20 shares at 2025 and 2024			(748	)			(748	)
Accumulated other comprehensive income/(loss)			262				(109	)
Non-controlling interests			23				17
Retained earnings			6,604				6,128
Total equity			11,617				6,437
Total liabilities and equity		$	25,636			$	17,612

See accompanying Notes to Condensed Consolidated Financial Statements.

BROWN & BROWN, INC.

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

(UNAUDITED)

		Common Stock
(in millions, except per share data)		Shares Outstanding				Par Value				Additional Paid-In Capital				Treasury Stock				Accumulated Other Comprehensive Income (Loss)				Retained Earnings				Non-Controlling Interest				Total
Balance at December 31, 2024			286			$	31			$	1,118			$	(748	)		$	(109	)		$	6,128			$	17			$	6,437
Net income																							331				3				334
Foreign currency translation																			124												124
Shares issued - employee stock compensation plans:
Employee stock purchase plan											4																				4
Stock incentive plans			1								25																				25
Repurchase shares to fund tax withholdings for non-cash stock-based compensation											(40	)																			(40	)
Cash dividends paid ($0.15 per share)																							(43	)							(43	)
Balance at March 31, 2025			287			$	31			$	1,107			$	(748	)		$	15			$	6,416			$	20			$	6,841
Net income																							231				3				234
Foreign currency translation																			247												247
Shares issued - employee stock compensation plans:
Employee stock purchase plan											3																				3
Stock incentive plans											20																				20
Shares issued - public offering			43				4				4,311																				4,315
Directors											1																				1
Repurchase shares to fund tax withholdings for non-cash stock-based compensation											(1	)																			(1	)
Cash dividends paid ($0.15 per share)																							(43	)							(43	)
Balance at June 30, 2025			330			$	35			$	5,441			$	(748	)		$	262			$	6,604			$	23			$	11,617
Balance at December 31, 2023			285			$	30			$	1,027			$	(748	)		$	(19	)		$	5,289			$	—			$	5,579
Net income																							293								293
Foreign currency translation																			(32	)											(32	)
Shares issued - employee stock compensation plans:
Employee stock purchase plan											4																				4
Stock incentive plans			1								25																				25
Net non-controlling interest acquired (disposed)											1																9				10
Repurchase shares to fund tax withholdings for non-cash stock-based compensation			(1	)							(54	)																			(54	)
Cash dividends paid ($0.13 per share)																							(38	)							(38	)
Balance at March 31, 2024			285			$	30			$	1,003			$	(748	)		$	(51	)		$	5,544			$	9			$	5,787
Net income																							257				2				259
Foreign currency translation																			4												4
Shares issued - employee stock compensation plans:
Employee stock purchase plan											3																				3
Stock incentive plans											20																				20
Directors											1																				1
Cash dividends paid ($0.13 per share)																							(37	)							(37	)
Balance at June 30, 2024			285			$	30			$	1,027			$	(748	)		$	(47	)		$	5,764			$	11			$	6,037

See accompanying Notes to Condensed Consolidated Financial Statements.

BROWN & BROWN, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

		Six months ended June 30,
(in millions)		2025				2024
Cash flows from operating activities:
Net income before non-controlling interests		$	569			$	553
Adjustments to reconcile net income before non-controlling interests to net cash provided by operating activities:
Amortization			103				86
Depreciation			23				21
Non-cash stock-based compensation			52				52
Change in estimated acquisition earn-out payables			7				(2	)
Deferred income taxes			(2	)			(3	)
Net loss/(gain) on sales/disposals of investments, businesses, fixed assets and customer accounts			2				(29	)
Payments on acquisition earn-outs in excess of original estimated payables			(1	)			(31	)
Other			2				2
Changes in operating assets and liabilities, net of effect from acquisitions and divestitures:
Commissions, fees and other receivables (increase) decrease			(139	)			(140	)
Reinsurance recoverable (increase) decrease			1,142				26
Prepaid reinsurance premiums (increase) decrease			(9	)			(21	)
Other assets (increase) decrease			(11	)			(80	)
Losses and loss adjustment reserve increase (decrease)			(1,143	)			(23	)
Unearned premiums increase (decrease)			55				140
Accounts payable increase (decrease)			5				(54	)
Accrued expenses and other liabilities increase (decrease)			(132	)			(109	)
Other liabilities increase (decrease)			15				(15	)
Net cash provided by operating activities			538				373
Cash flows from investing activities:
Additions to fixed assets			(32	)			(39	)
Payments for businesses acquired, net of cash acquired			(161	)			(98	)
Proceeds from sales of businesses, fixed assets and customer accounts			10				58
Other investing activities			(4	)			2
Net cash used in investing activities			(187	)			(77	)
Cash flows from financing activities:
Fiduciary receivables and liabilities, net			119				248
Payments on acquisition earn-outs			(45	)			(65	)
Proceeds from long-term debt			4,192				599
Payments on long-term debt			(188	)			(175	)
Deferred debt issuance costs			(36	)			(5	)
Borrowings on revolving credit facility			150				150
Payments on revolving credit facility			(400	)			(250	)
Proceeds from issuance of common stock, net of expenses			4,315				—
Repurchase shares to fund tax withholdings for non-cash stock-based compensation			(41	)			(54	)
Cash dividends paid			(86	)			(75	)
Other financing activities			1				2
Net cash provided by financing activities			7,981				375
Effect of foreign exchange rate changes on cash and cash equivalents inclusive of fiduciary cash			85				—
Net increase in cash and cash equivalents inclusive of fiduciary cash			8,417				671
Cash and cash equivalents inclusive of fiduciary cash at beginning of period			2,502				2,303
Cash and cash equivalents inclusive of fiduciary cash at end of period		$	10,919			$	2,974

See accompanying Notes to Condensed Consolidated Financial Statements. Refer to Note 10 for the reconciliations of cash and cash equivalents inclusive of fiduciary cash.

NOTES TO CONDEN****SED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

NOTE 1 Nature of Operations

Brown & Brown, Inc., a Florida corporation, and its subsidiaries (collectively, “Brown & Brown” or the “Company”) is a diversified insurance agency, wholesale brokerage, insurance programs and service organization that markets and sells insurance products and services, primarily in the property, casualty and employee benefits areas. Brown & Brown’s business is divided into three reportable segments. The Retail segment provides a broad range of insurance products and services to commercial, public and quasi-public entities, professional and individual insured customers, and non-insurance risk-mitigating products through our automobile and recreational vehicle dealer services (“F&I”) businesses. The Programs segment, which acts as a managing general underwriter (“MGU”), provides professional liability and related package products for certain professionals, a range of insurance products for individuals, flood coverage, and targeted products and services designated for specific industries, trade groups, governmental entities and market niches, all of which are delivered through a nationwide network of independent agents, including Brown & Brown retail agents. The Wholesale Brokerage segment markets and sells excess and surplus commercial and personal lines insurance, primarily through independent agents and brokers, as well as Brown & Brown retail agents.

The Company primarily operates as an agent or broker not assuming underwriting risks. However, we operate a write-your-own flood insurance carrier, Wright National Flood Insurance Company (“WNFIC”). WNFIC’s underwriting business consists of policies written pursuant to the National Flood Insurance Program (“NFIP”), the program administered by the Federal Emergency Management Agency (“FEMA”) to which premiums and underwriting exposure are ceded, and excess flood policies which are fully reinsured in the private market. The Company also operates two capitalized captive insurance facilities (the "Captives") for the purpose of facilitating additional underwriting capacity, generating incremental revenues and participating in underwriting results.

NOTE 2 Basis of Financial Reporting

The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”) for interim financial information and with the instructions for Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of recurring accruals) necessary for a fair presentation have been included. These unaudited Condensed Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements and the Notes thereto set forth in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.

The preparation of these financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, as well as disclosures of contingent assets and liabilities, at the date of the Condensed Consolidated Financial Statements, and the reported amounts of revenues and expenses during the reporting period. Actual results may differ from those estimates.

Recently Issued Accounting Pronouncements

In November 2024, the FASB issued ASU 2024-03, "Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40)" which requires disclosure of specific information about certain costs and expenses in the notes to the financial statements. This ASU is effective for annual periods beginning after December 15, 2026 and interim periods beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating these new disclosure requirements.

On December 14, 2023, the FASB issued ASU 2023-09, "Improvements to Income Tax Disclosures." This ASU improves the transparency of income tax disclosures by requiring consistent categories and greater disaggregation of information in the rate reconciliation and income taxes paid disaggregated by jurisdiction. This ASU is effective for annual periods beginning after December 15, 2024. Early adoption is permitted. The Company is currently evaluating these new disclosure requirements.

Recently Adopted Accounting Standards

In November 2023, the FASB issued ASU 2023-07, "Improvements to Reportable Segment Disclosures." This ASU requires additional reportable segment disclosures, primarily through enhanced disclosures about significant segment expenses. In addition, the ASU enhances interim disclosure requirements effectively making the current annual requirements a requirement for interim reporting. The Company adopted ASU 2023-07 for fiscal year ending December 31, 2024, and it has been applied retrospectively to the interim disclosures beginning January 1, 2025.

Income Taxes

On July 4, 2025, the One Big Beautiful Bill Act ("OBBBA") was enacted in the U.S. The OBBBA includes significant provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act of 2017, modifications to the international tax framework and the restoration of favorable tax treatment for certain business provisions. The legislation has multiple effective dates, with certain provisions effective in 2025 and other implemented through 2027. The Company is currently assessing its impact on the Condensed Consolidated Financial Statements.

NOTE 3 Revenues

The following tables present the revenues disaggregated by revenue source:

		Three months ended June 30, 2025
(in millions)		Retail				Programs				Wholesale Brokerage				Other (8)				Total
Base commissions (1)		$	483			$	254			$	141			$	—			$	878
Fees (2)			173				66				29				—				268
Other supplemental commissions (3)			31				7				3				—				41
Profit-sharing contingent commissions (4)			7				30				8				—				45
Earned premium (5)			—				17				—				—				17
Investment income (6)			3				6				1				25				35
Other income, net (7)			—				1				—				—				1
Total revenues		$	697			$	381			$	182			$	25			$	1,285

		Three months ended June 30, 2024
(in millions)		Retail				Programs				Wholesale Brokerage				Other (8)				Total
Base commissions (1)		$	449			$	243			$	129			$	—			$	821
Fees (2)			156				61				24				(1	)			240
Other supplemental commissions (3)			32				6				1				—				39
Profit-sharing contingent commissions (4)			7				25				4				—				36
Earned premium (5)			—				18				—				—				18
Investment income (6)			1				5				1				15				22
Other income, net (7)			1				1				—				—				2
Total revenues		$	646			$	359			$	159			$	14			$	1,178

		Six months ended June 30, 2025
(in millions)		Retail				Programs				Wholesale Brokerage				Other (8)				Total
Base commissions (1)		$	1,099			$	473			$	264			$	—			$	1,836
Fees (2)			350				131				53				(1	)			533
Other supplemental commissions (3)			128				8				5				—				141
Profit-sharing contingent commissions (4)			22				49				17				—				88
Earned premium (5)			—				36				—				—				36
Investment income (6)			4				11				2				36				53
Other income, net (7)			1				1				—				—				2
Total revenues		$	1,604			$	709			$	341			$	35			$	2,689

		Six months ended June 30, 2024
(in millions)		Retail				Programs				Wholesale Brokerage				Other (8)				Total
Base commissions (1)		$	996			$	449			$	242			$	—			$	1,687
Fees (2)			312				110				43				(2	)			463
Other supplemental commissions (3)			119				7				4				—				130
Profit-sharing contingent commissions (4)			21				51				10				—				82
Earned premium (5)			—				28				—				—				28
Investment income (6)			2				10				2				26				40
Other income, net (7)			2				2				—				1				5
Total revenues		$	1,452			$	657			$	301			$	25			$	2,435

(1)

Base commissions generally represent a percentage of the premium paid by an insured and are affected by fluctuations in both premium rate levels charged by insurance companies and the insureds’ underlying “insurable exposure units,” which are units that insurance companies use to measure or express insurance exposed to risk (such as property values, or sales and payroll levels) to determine what premium to charge the insured. Insurance companies establish these premium rates based upon many factors, including loss experience, risk profile and reinsurance rates paid by such insurance companies, none of which we control.

(2)

Fee revenues relate to fees for services other than securing coverage for our customers, including fees negotiated in lieu of commissions, and F&I products and services.

(3)

Other supplemental commissions include additional commissions over base commissions received from insurance carriers based on predetermined growth or production measures. This includes incentive commissions and guaranteed supplemental commissions.

(4)

Profit-sharing contingent commissions are based primarily on underwriting results, but may also reflect considerations for volume, growth and/or retention.

(5)

Earned premium relates to the premiums earned in the Captives.

(6)

Investment income consists primarily of interest on cash and investments.

(7)

Other income consists primarily of other miscellaneous income.

(8)

Fees within Other reflect the elimination of intercompany revenues.

The following table presents the revenues disaggregated by geographic area where our services are being performed:

		Three months ended June 30,								Six months ended June 30,
(in millions)		2025				2024				2025				2024
U.S.		$	1,073			$	1,006			$	2,247			$	2,105
U.K.			164				144				304				275
Other			48				28				138				55
Total revenues		$	1,285			$	1,178			$	2,689			$	2,435

Contract Assets and Liabilities

The balances of contract assets and contract liabilities arising from contracts with customers as of June 30, 2025 and December 31, 2024 were as follows:

(in millions)		June 30, 2025				December 31, 2024
Contract assets		$	649			$	575
Contract liabilities		$	115			$	119

Unbilled receivables (contract assets) arise when the Company recognizes revenue for amounts which have not yet been billed in the Company's systems and are reflected in commissions, fees and other receivables in the Company's Condensed Consolidated Balance Sheets. The increase in contract assets over the balance as of December 31, 2024 is due to normal seasonality, growth in the business and from businesses acquired in the current year.

Deferred revenue (contract liabilities) relates to payments received in advance of performance under the contract before the transfer of a good or service to the customer. Deferred revenue is reflected within accrued expenses and other liabilities for those to be recognized in less than twelve months and in other liabilities for those to be recognized more than twelve months from the date presented in the Company's Condensed Consolidated Balance Sheets.

As of June 30, 2025, deferred revenue totaled $115 million and consisted of $75 million and $40 million classified as short term and long term, respectively. As of December 31, 2024, deferred revenue totaled $119 million and consisted of $80 million and $39 million classified as short term and long term, respectively.

During the six months ended June 30, 2025 and 2024, the net amount of revenue recognized related to performance obligations satisfied in a previous period was $22 million and $21 million, consisting of additional variable consideration received on our incentive and profit-sharing contingent commissions.

Other Assets and Deferred Cost

Incremental cost to obtain - The Company defers certain costs to obtain customer contracts primarily as they relate to commission-based compensation plans in the Retail segment, in which the Company pays an incremental amount of compensation on new business. These incremental costs are deferred and amortized over a 15-year period. The cost to obtain balance within the other assets caption in the Company's Condensed Consolidated Balance Sheets was $130 million and $119 million as of June 30, 2025 and December 31, 2024, respectively. For the six months ended June 30, 2025, the Company deferred $16 million of incremental cost to obtain customer contracts. The Company recorded an expense of $5 million associated with the incremental cost to obtain customer contracts for the six months ended June 30, 2025.

Cost to fulfill - The Company defers certain costs to fulfill contracts and recognizes these costs as the associated performance obligations are fulfilled. The cost to fulfill balance within the other current assets caption in the Company's Condensed Consolidated Balance Sheets was $126 million and $145 million as of June 30, 2025 and December 31, 2024, respectively. For the six months ended June 30, 2025, the Company had net expense of $23 million related to the release of previously deferred contract fulfillment costs associated with performance obligations that were satisfied in the period, net of current year deferrals for costs incurred that related to performance obligations yet to be fulfilled.

NOTE 4 Net Income Per Share

Basic net income per share is computed based on the weighted average number of common shares (including participating securities) issued and outstanding during the period. Diluted net income per share is computed based on the weighted average number of common shares issued and outstanding plus equivalent shares, assuming the issuance of all potentially issuable common shares. The dilutive effect of potentially issuable common shares is computed by application of the treasury stock method. The following is a reconciliation between basic and diluted weighted average shares outstanding:

		Three months ended June 30,								Six months ended June 30,
(in millions, except per share data)		2025				2024				2025				2024
Net income attributable to the Company		$	231			$	257			$	563			$	550
Net income attributable to unvested awarded performance stock			(3	)			(3	)			(6	)			(6	)
Net income attributable to common shares		$	228			$	254			$	557			$	544
Weighted average number of common shares outstanding – basic			295				285				291				285
Less unvested awarded performance stock included in weighted average number of common shares outstanding – basic			(3	)			(3	)			(4	)			(4	)
Weighted average number of common shares outstanding for basic net income per common share			292				282				287				281
Dilutive effect of potentially issuable common shares			1				1				2				2
Weighted average number of shares outstanding – diluted			293				283				289				283
Net income per share:
Basic		$	0.79			$	0.90			$	1.94			$	1.93
Diluted		$	0.78			$	0.90			$	1.93			$	1.92

NOTE 5 Business Combinations

During the six months ended June 30, 2025, Brown & Brown acquired all of the stock of nine insurance intermediaries, purchased assets and assumed certain liabilities of 13 insurance intermediaries, and purchased seven books of business (customer accounts) for a total of 29 acquisitions. Additionally, adjustments were recorded to the purchase price allocation of certain prior acquisitions completed within the last twelve months as permitted by Accounting Standards Codification (“ASC”) Topic 805 — Business Combinations (“ASC 805”).

On June 10, 2025, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”), by and among RSC, the Company, Encore Merger Sub, Inc., a Delaware corporation and wholly owned subsidiary of the Company (“Merger Sub”) and Kelso RSC (Investor), L.P., a Delaware limited partnership, solely in its capacity as the equityholder representative, pursuant to which the Company will acquire RSC, the holding company for Accession Risk Management Group, Inc., a North American insurance distribution platform with a family of specialty insurance and risk management companies, including Risk Strategies, a dynamic specialty brokerage firm, and One80 Intermediaries, a leading insurance wholesaler and program manager. The transaction is expected to close in the third quarter of 2025, subject to customary closing conditions and regulatory approvals. The aggregate purchase price is $9,825 million, payable at closing, subject to certain customary post-closing adjustments. After adjustments, the net merger consideration payable at closing is expected to be approximately $9,400 million, composed of approximately $8,100 million in cash and approximately $1,300 million in shares of the Company’s common stock, par value $0.10 per share. A portion of the merger consideration will be held in escrow pursuant to certain indemnification arrangements. We expect to fund the acquisition using cash raised from our June 2025 follow-on common stock offering and senior notes issuance.

The recorded purchase price for all acquisitions includes an estimation of the fair value of liabilities associated with any potential earn-out provisions. Subsequent changes in the fair value of earn-out obligations are recorded in the Condensed Consolidated Statements of Income when incurred. The fair value of earn-out obligations is based on the present value of the expected future payments to be made to the sellers of the acquired businesses in accordance with the provisions outlined in the respective purchase agreements.

Based on the acquisition date and the complexity of the underlying valuation work, certain amounts included in the Company’s Condensed Consolidated Financial Statements may be provisional and thus subject to further adjustments within the permitted measurement period, as defined in ASC 805.

For the six months ended June 30, 2025, adjustments were made within the permitted measurement period, which increased total net assets acquired by $5 million and decreased goodwill by $5 million. These measurement-period adjustments have been reflected as current period adjustments in the six months ended June 30, 2025 in accordance with the guidance in ASC 805. The measurement-period adjustments had no effect on earnings or cash in the current period.

The following table summarizes the estimated fair values of the aggregate assets and liabilities acquired through the six months ended June 30, 2025 as of the date of each acquisition and adjustments made during the measurement period of the prior year acquisitions.

(in millions)		NBS Insurance Agency				Tim Parkman, Inc.				Other (1)				Total
Business Segment		Wholesale				Wholesale				Various
Effective date of acquisition		March 1, 2025				May 1, 2025				Various
Cash paid		$	54			$	69			$	60			$	183
Other payable			—				6				4				10
Recorded earn-out payable			—				4				13				17
Total consideration			54				79				77				210
Maximum potential earn-out payable			—				23				25				48
Allocation of purchase price:
Cash and equivalents			—				—				5				5
Fiduciary cash			13				—				4				17
Fiduciary receivables			—				—				22				22
Other current assets			4				—				1				5
Goodwill			30				60				42				132
Purchased customer accounts and other intangibles (2)			17				19				25				61
Other assets			—				—				4				4
Total assets acquired			64				79				103				246
Fiduciary liabilities			(10	)			—				(22	)			(32	)
Other current liabilities			—				—				(3	)			(3	)
Other long-term liabilities			—				—				(1	)			(1	)
Total liabilities assumed			(10	)			—				(26	)			(36	)
Net assets acquired		$	54			$	79			$	77			$	210

(1)

The other column represents a summarization of current year acquisitions with total consideration of less than $50 million per acquisition and adjustments from prior year acquisitions that were made within the permitted measurement period.

(2)

The weighted average useful life of purchased customer accounts is 15 years.

For the acquisitions completed during 2025, the results of operations since the acquisition dates have been combined with those of the Company. The total revenues and income before income taxes from acquisitions completed through June 30, 2025 included in the Condensed Consolidated Statement of Income for the six months ended June 30, 2025 were $18 million and $3 million, respectively.

If the Company's 2025 acquisitions had occurred as of the beginning of 2024, the estimated results of operations would be as shown in the following table. These unaudited pro forma results are not necessarily indicative of the actual results of operations that would have occurred had the acquisitions actually been made at the beginning of the respective periods.

(UNAUDITED)		For the six months ended June 30,
(in millions, except per share data)		2025				2024
Total revenues		$	2,701			$	2,471
Net income		$	565			$	555
Net income per share:
Basic		$	1.97			$	1.97
Diluted		$	1.95			$	1.96

Acquisition Earn-Out Payables

As of June 30, 2025 and 2024, the fair values of the estimated acquisition earn-out payables were re-evaluated and measured at fair value on a recurring basis using unobservable inputs (Level 3) as defined in ASC 820 - Fair Value Measurement. The resulting additions, payments, and net changes, as well as the interest expense accretion on the estimated acquisition earn-out payables were as follows:

		Three months ended June 30,								Six months ended June 30,
(in millions)		2025				2024				2025				2024
Balance as of the beginning of the period		$	143			$	203			$	167			$	249
Additions to estimated acquisition earn-out payables			12				10				17				19
Payments for estimated acquisition earn-out payables			(20	)			(45	)			(46	)			(96	)
Subtotal			135				168				138				172
Net change in earnings from estimated acquisition earn-out payables:
Change in fair value on estimated acquisition earn-out payables			9				(2	)			4				(7	)
Interest expense accretion			2				3				3				5
Net change in earnings from estimated acquisition earn-out payables			11				1				7				(2	)
Foreign currency translation adjustments during the year			5				—				6				(1	)
Balance as of June 30,		$	151			$	169			$	151			$	169

Of the $151 million of estimated acquisition earn-out payables as of June 30, 2025, $63 million was recorded as accounts payable and $88 million was recorded as other non-current liabilities. As of June 30, 2025, the maximum future acquisition contingency payments was $429 million. Four of the estimated acquisition earn-out payables include provisions with no maximum potential earn-out amount. The amount recorded for these acquisitions as of June 30, 2025 is $1 million. The Company believes a significant increase to this amount to be unlikely.

NOTE 6 Goodwill

The changes in the carrying value of goodwill by reportable segment for the six months ended June 30, 2025 are as follows:

(in millions)		Retail				Programs				Wholesale Brokerage				Total
Balance as of December 31, 2024		$	5,436			$	1,884			$	650			$	7,970
Goodwill of acquired businesses			21				24				92				137
Goodwill adjustments during measurement period (1)			(5	)			—				—				(5	)
Goodwill disposed of relating to sales of businesses			(5	)			—				—				(5	)
Foreign currency translation adjustments during the year			218				41				9				268
Balance as of June 30, 2025		$	5,665			$	1,949			$	751			$	8,365

(1)

Provisional estimates of fair value of acquired assets and liabilities are established at the time of each acquisition and are subsequently reviewed and finalized within the first year of operations subsequent to the acquisition date to determine the necessity for adjustments to goodwill.

NOTE 7 Amortizable Intangible Assets

Amortizable intangible assets consisted of the following:

		June 30, 2025												December 31, 2024
(in millions)		Gross carrying value				Accumulated amortization				Net carrying value				Gross carrying value				Accumulated amortization				Net carrying value
Purchased customer accounts and other		$	3,544			$	(1,776	)		$	1,768			$	3,557			$	(1,718	)		$	1,839
Foreign currency translation adjustments during the year			112				(14	)			98				(28	)			3				(25	)
Total		$	3,656			$	(1,790	)		$	1,866			$	3,529			$	(1,715	)		$	1,814

Amortization expense for intangible assets for the years ending December 31, 2025, 2026, 2027, 2028 and 2029 is estimated to be $194 million, $189 million, $177 million, $171 million, and $154 million, respectively.

NOTE 8 Long-Term Debt

Long-term debt consisted of the following:

(in millions)		June 30, 2025				December 31, 2024
Current portion of long-term debt:
Current portion of 5-year term loan facility expires 2026		$	25			$	25
Current portion of 3-year term loan facility expires 2025			—				150
Current portion of 5-year term loan facility expires 2027			50				50
Total current portion of long-term debt			75				225
Long-term debt:
Note agreements:
4.600% senior notes, semi-annual interest payments, balloon due 2026			400				—
4.700% senior notes, semi-annual interest payments, balloon due 2028			500				—
4.500% senior notes, semi-annual interest payments, balloon due 2029			350				350
4.900% senior notes, semi-annual interest payments, balloon due 2030			800				—
2.375% senior notes, semi-annual interest payments, balloon due 2031			700				700
4.200% senior notes, semi-annual interest payments, balloon due 2032			600				600
5.250% senior notes, semi-annual interest payments, balloon due 2032			500				—
5.650% senior notes, semi-annual interest payments, balloon due 2034			600				600
5.550% senior notes, semi-annual interest payments, balloon due 2035			1,000				—
4.950% senior notes, semi-annual interest payments, balloon due 2052			600				600
6.250% senior notes, semi-annual interest payments, balloon due 2055			1,000				—
Total notes			7,050				2,850
Credit agreements:
5-year term loan facility, periodic interest and principal payments, SOFR plus up to 1.750%, expires October 27, 2026			156				169
5-year revolving loan facility, periodic interest payments, SOFR plus up to 1.525%, plus commitment fees up to 0.225%, expires October 27, 2026			—				250
5-year term loan facility, periodic interest and principal payments, SOFR plus up to 1.750%, expires March 31, 2027			338				362
Total credit agreements			494				781
Unamortized portion of debt discounts related to note agreements (contra)			(19	)			(11	)
Debt issuance costs (contra)			(55	)			(21	)
Total long-term debt, less unamortized discount and debt issuance costs			7,470				3,599
Current portion of long-term debt			75				225
Total debt		$	7,545			$	3,824

Note agreements: On June 11, 2025, the Company entered into an Underwriting Agreement (the “Notes Underwriting Agreement”) with BofA Securities, Inc. and J.P. Morgan Securities LLC, as representatives of the several underwriters named therein (collectively, the “Notes Underwriters”), with respect to the offer and sale by the Company of $400 million principal amount of its 4.600% Senior Notes due 2026 (the “2026 Notes”), $500 million principal amount of its 4.700% Senior Notes due 2028 (the “2028 Notes”), $800 million principal amount of its 4.900% Senior Notes due 2030 (the “2030 Notes”), $500 million principal amount of its 5.250% Senior Notes due 2032 (the “2032 Notes”), $1,000 million principal amount of its 5.550% Senior Notes due 2035 (the “2035 Notes”) and $1,000 million principal amount of its 6.250% Senior Notes due 2055 (the “2055 Notes” and, together with the 2026 Notes, the 2028 Notes, the 2030 Notes, the 2032 Notes, and the 2035 Notes, the “Notes”). The Notes Underwriting Agreement contains customary representations, warranties and covenants of the Company, conditions to closing, termination provisions and other terms and conditions customary in agreements of this type. The Notes Underwriting Agreement also contains customary indemnification and contribution rights and obligations of the Company and the Notes Underwriters. The Company intends to use the net proceeds of the offering of the Notes, together with the proceeds from the offering of shares of common stock and cash on hand, to fund the cash consideration payable under the Merger Agreement, and to pay fees and expenses associated with the foregoing. If the acquisition of Accession is not consummated, each of the notes described above has a special mandatory redemption feature and would require repayment except for the 2035 Notes, for which the Company intends to use the proceeds for general corporate purposes. As of June 30, 2025, the aggregate outstanding balance of these notes was $4,200 million exclusive of the associated discount balance.

The Company maintains notes from other issuances aggregating to a total outstanding debt balance of $2,850 million exclusive of the associated discount balance as of June 30, 2025 and December 31, 2024.

Credit agreements: On March 31, 2025, the Company repaid the outstanding balance on the 3-year term loan facility of $150 million.

The Company has credit agreements that include term loans and a Revolving Credit Facility of $800 million, all having similar terms and covenants. The outstanding balance on the term loans was $569 million and $756 million as of June 30, 2025 and December 31, 2024, respectively. There were no outstanding balances on the Revolving Credit Facility as of June 30, 2025 and $250 million outstanding as of December 31, 2024.

The Company is required to maintain certain financial ratios and comply with certain other covenants. The Company was in compliance with all such covenants as of June 30, 2025 and December 31, 2024.

At June 30, 2025, the 1-month Term SOFR Rate for the term loan due October 2026 and the term loan due March 2027 was 4.427%. These SOFR rates are inclusive of a 0.100% credit-spread adjustment per the terms of the relevant agreements.

Fair value information about financial instruments not measured at fair value

The following table presents liabilities that are not measured at fair value on a recurring basis:

		June 30, 2025								December 31, 2024
(in millions)		Carrying Value				Fair Value				Carrying Value				Fair Value
Liabilities:
Current portion of long-term debt		$	—			$	—			$	—			$	—
Long-term debt		$	7,031			$	6,961			$	2,839			$	2,602

The carrying value of the Company's borrowings under various credit agreements approximates its fair value due to the variable interest rate based upon adjusted SOFR. The fair values above, which exclude accrued interest, are not necessarily indicative of the amounts that the Company would realize upon disposition, nor do they indicate the Company’s intent or ability to dispose of the financial instruments. The fair values of our respective senior notes are considered Level 2 financial instruments, as their values are measured by using observable inputs, other than quoted prices in active markets.

NOTE 9 Leases

Substantially all of the Company's operating lease right-of-use assets and operating lease liabilities represent real estate leases for office space used to conduct the Company's business that expire on various dates through 2041. Leases generally contain renewal options and escalation clauses based upon increases in the lessors’ operating expenses and other charges. The Company anticipates that most of these leases will be renewed or replaced upon expiration, although not necessarily for the same amount of space.

The balances and classification of operating lease right-of-use assets and operating lease liabilities within the Condensed Consolidated Balance Sheets is as follows:

(in millions)			June 30, 2025				December 31, 2024
Assets:
Operating lease right-of-use assets	Operating lease assets		$	198			$	200
Total assets				198				200
Liabilities:
Current operating lease liabilities	Accrued expenses and other liabilities			46				47
Non-current operating lease liabilities	Operating lease liabilities			186				189
Total liabilities			$	232			$	236

The components of lease cost for operating leases were as follows:

	Three months ended June 30,								Six months ended June 30,
(in millions)	2025				2024				2025				2024
Operating leases:
Lease cost	$	16			$	14			$	30			$	28
Variable lease cost		2				1				2				2
Operating lease cost		18				15				32				30
Sublease income		(1	)			—				(1	)			(1	)
Total lease cost net	$	17			$	15			$	31			$	29

The weighted average remaining lease term and the weighted average discount rate for operating leases as of June 30, 2025 were:

Weighted average remaining lease term in years			5.96
Weighted average discount rate			4.00	%

Maturities of the operating lease liabilities by fiscal year at June 30, 2025 for the Company's operating leases are as follows:

(in millions)		Operating leases
2025 (Remainder)		$	26
2026			54
2027			45
2028			36
2029			29
Thereafter			70
Total undiscounted lease payments			260
Less: imputed interest			28
Present value of lease payments		$	232

Supplemental cash flow information for operating leases is as follows:

	Three months ended June 30,								Six months ended June 30,
(in millions)	2025				2024				2025				2024
Cash paid for amounts included in measurement of liabilities
Operating cash flows from operating leases	$	17			$	15			$	33			$	30
Right-of-use assets obtained in exchange for new operating liabilities	$	9			$	13			$	15			$	25

NOTE 10 Supplemental Disclosures of Cash Flow Information and Non-Cash Financing and Investing Activities

During the six months ended June 30, 2025, the Company had an impact of $85 million from foreign exchange rate changes on cash and cash equivalents inclusive of fiduciary cash reported on its Condensed Consolidated Statements of Cash Flows due to the change in currency exchange rates.

Cash paid during the period for interest and income taxes are summarized as follows:

		Six months ended June 30,
(in millions)		2025				2024
Cash paid during the period for:
Interest		$	90			$	94
Income taxes, net of refunds		$	268			$	267

During 2024, the Company accrued for and deferred approximately $90 million related to certain federal income tax payments due to Hurricanes Debby and Milton tax relief. These deferrals of income tax payments were paid by the deadline of May 1, 2025.

During the six months ended June 30, 2024, the Company paid $91 million related to certain federal income tax payments that were deferred from 2023 due to Hurricane Idalia tax relief and paid approximately $30 million of tax payments associated with the gain on disposal of certain third-party claims administration and adjusting services businesses sold in the fourth quarter of 2023.

Significant non-cash investing and financing activities are summarized as follows:

		Six months ended June 30,
(in millions)		2025				2024
Other payables issued for agency acquisitions and purchased customer accounts		$	10			$	7
Estimated acquisition earn-out payables issued for agency acquisitions		$	17			$	19

The Company's restricted cash balance is composed of funds held in separate premium trust accounts as required by state law or, in some cases, by agreement with carrier partners. The following is a reconciliation of cash and cash equivalents inclusive of restricted cash as of June 30, 2025 and 2024.

(in millions)		June 30, 2025				December 31, 2024
Table to reconcile restricted and non-restricted fiduciary cash
Restricted fiduciary cash		$	1,674			$	1,570
Non-restricted fiduciary cash			352				257
Total restricted and non-restricted fiduciary cash at the end of the period		$	2,026			$	1,827

		Balance as of June 30,
(in millions)		2025				2024
Table to reconcile cash and cash equivalents inclusive of fiduciary cash
Cash and cash equivalents		$	8,893			$	1,107
Fiduciary cash			2,026				1,867
Total cash and cash equivalents inclusive of restricted cash at the end of the period		$	10,919			$	2,974

NOTE 11 Legal and Regulatory Proceedings

The Company is involved in numerous pending or threatened proceedings by or against Brown & Brown, Inc. or one or more of its subsidiaries that arise in the ordinary course of business. The damages that may be claimed against the Company in these various proceedings are in some cases substantial, including in certain instances claims for punitive or extraordinary damages. Some of these claims and lawsuits have been resolved; others are in the process of being resolved and others are still in the investigation or discovery phase. The Company will continue to respond appropriately to these claims and lawsuits and vigorously protect its interests.

The Company continues to assess certain litigation and claims to determine the amounts, if any, that management believes will be paid as a result of such claims and litigation and, therefore, additional losses may be accrued and paid in the future, which could adversely impact the Company’s operating results, cash flows and overall liquidity. The Company maintains third-party insurance policies to provide coverage for certain legal claims, in an effort to mitigate its overall exposure to unanticipated claims or adverse decisions. However, as (i) one or more of the Company’s insurance carriers could take the position that portions of these claims are not covered by the Company’s insurance, (ii) to the extent that payments are made to resolve claims and lawsuits, applicable insurance policy limits are eroded and (iii) the claims and lawsuits relating to these matters are continuing to develop, it is possible that future results of operations or cash flows for any particular quarterly or annual period could be materially affected by unfavorable resolutions of these matters. Based upon the AM Best Company ratings of these third-party insurers and other factors, management does not believe there is a substantial risk of an insurer’s material non-performance related to any current insured claims.

On the basis of current information, the availability of insurance and legal advice, in management’s opinion, the Company is not currently involved in any legal proceedings which, individually or in the aggregate, would have a material adverse effect on its financial condition, operations and/or cash flows.

NOTE 12 Segment Information

Brown & Brown’s business is divided into three reportable segments: (i) the Retail segment, which provides a broad range of insurance products and services to commercial, public and quasi-public entities, and to professional and individual customers, and non-insurance risk-mitigating products through our F&I businesses; (ii) the Programs segment, which primarily acts as MGUs, provides professional liability and related package products for certain professionals, a range of insurance products for individuals, flood coverage, and targeted products and services designated for specific industries, trade groups, governmental entities and market niches, all of which are delivered through nationwide networks of independent agents, and Brown & Brown retail agents; and (iii) the Wholesale Brokerage segment, which markets and sells excess and surplus commercial and personal lines insurance, primarily through independent agents and brokers, as well as Brown & Brown retail agents.

Brown & Brown conducts most of its operations within the U.S. International operations include retail operations based in Bermuda, Canada, Cayman Islands, the Netherlands, Republic of Ireland and the United Kingdom; programs operations in Canada, France, Germany, Hong Kong, Italy, Malaysia, the Netherlands, Singapore, United Arab Emirates and the United Kingdom; and wholesale brokerage operations based in Belgium, Hong Kong, Italy and the United Kingdom. These international operations earned $212 million and $172 million of total revenues for the three months ended June 30, 2025 and 2024, respectively. These international operations earned $442 million and $330 million of total revenues for the six months ended June 30, 2025 and 2024, respectively.

The Company's chief operating decision maker ("CODM"), the president and chief executive officer, regularly receives information regarding total revenue, income before income taxes and earnings before interest, income taxes, depreciation, amortization and change in estimated acquisition earn-out payables ("EBITDAC"). The metrics are used to review operating trends, to perform analytical comparisons between periods and to monitor budget to actual variances. The Company's CODM does not use segment assets to make resource allocation decisions; and therefore, segment assets have not been presented.

Summarized financial information concerning the Company’s reportable segments is shown in the following tables.

		Three months ended June 30, 2025
(in millions)		Retail				Programs				Wholesale Brokerage				Total
Total segment revenues		$	697			$	381			$	182			$	1,260
Reconciliation of revenues
Other (1)															25
Total consolidated revenues														$	1,285
Less: (2)
Employee compensation and benefits			385				109				93
Other operating expenses			120				71				27
(Gain)/loss on disposal			—				—				—
Depreciation and amortization			41				15				4
Interest expense			15				6				3
Change in estimated acquisition earn-out payables			9				—				2
Segment Income before income taxes		$	127			$	180			$	53			$	360
Reconciliation of income before income taxes
Other (1)															(49	)
Consolidated Income before income taxes														$	311

		Three months ended June 30, 2024
(in millions)		Retail				Programs				Wholesale Brokerage				Total
Total segment revenues		$	646			$	359			$	159			$	1,164
Reconciliation of revenues
Other (1)															14
Total consolidated revenues														$	1,178
Less: (2)
Employee compensation and benefits			355				111				82
Other operating expenses			110				70				24
(Gain)/loss on disposal			(2	)			(29	)			—
Depreciation and amortization			34				16				4
Interest expense			19				7				3
Change in estimated acquisition earn-out payables			1				1				(1	)
Segment Income before income taxes		$	129			$	183			$	47			$	359
Reconciliation of income before income taxes
Other (1)															(13	)
Consolidated Income before income taxes														$	346

(1) "Other" includes any income and expenses not allocated to reportable segments and corporate-related items.

(2) Significant expense categories and amounts align with the segment-level information that is regularly provided to the CODM.

		Six months ended June 30, 2025
(in millions)		Retail				Programs				Wholesale Brokerage				Total
Total segment revenues		$	1,604			$	709			$	341			$	2,654
Reconciliation of revenues
Other (1)															35
Total consolidated revenues														$	2,689
Less: (2)
Employee compensation and benefits			833				222				179
Other operating expenses			241				140				49
(Gain)/loss on disposal			1				—				—
Depreciation and amortization			85				31				8
Interest expense			30				12				6
Change in estimated acquisition earn-out payables			3				2				2
Segment Income before income taxes		$	411			$	302			$	97			$	810
Reconciliation of income before income taxes
Other (1)															(72	)
Consolidated Income before income taxes														$	738

		Six months ended June 30, 2024
(in millions)		Retail				Programs				Wholesale Brokerage				Total
Total segment revenues		$	1,452			$	657			$	301			$	2,410
Reconciliation of revenues
Other (1)															25
Total consolidated revenues														$	2,435
Less: (2)
Employee compensation and benefits			755				219				158
Other operating expenses			225				133				44
(Gain)/loss on disposal			(1	)			(28	)			—
Depreciation and amortization			68				31				8
Interest expense			38				16				6
Change in estimated acquisition earn-out payables			—				1				(3	)
Segment Income before income taxes		$	367			$	285			$	88			$	740
Reconciliation of income before income taxes
Other (1)															(28	)
Consolidated Income before income taxes														$	712

(1) "Other" includes any income and expenses not allocated to reportable segments and corporate-related items.

(2) Significant expense categories and amounts align with the segment-level information that is regularly provided to the CODM.

NOTE 13 Insurance Company Subsidiary Operations

The National Flood Insurance Program is a program administered by FEMA whereby the Company sells and services NFIP flood insurance policies on behalf of FEMA and receives fees for its services. Congressional authorization for the NFIP is periodically evaluated and may be subject to potential government shutdowns. The Company sells excess flood policies which are 100% ceded to a highly rated reinsurance carrier. The Company also operates two Captives for the purpose of facilitating additional underwriting capacity and to participate in a portion of the underwriting results. One Captive participates on a quota share basis for policies placed by certain of our MGU businesses that are currently focused on property insurance for earthquake and wind exposed properties with a portion of premiums ceded to reinsurance companies, limiting, but not fully eliminating the Company's exposure to underwriting losses. The other Captive participates through excess of loss reinsurance layers associated with one of our MGU businesses focused on placements of personal property, excluding flood, primarily in the southeastern United States with one layer of per risk excess reinsurance and three layers of catastrophe per occurrence reinsurance. All four layers have limited reinstatements and therefore have capped, maximum aggregate limits. The effects of reinsurance on premiums written and earned are as follows:

		Six months ended June 30, 2025
(in millions)		Written				Earned
Direct premiums - WNFIC		$	516			$	507
Ceded premiums - WNFIC			(516	)			(507	)
Net premiums - WNFIC			—				—
Assumed premiums - Quota share captive and excess of loss layer captive			114				70
Ceded premiums - Quota share captive			(34	)			(34	)
Net premiums - Quota share captive and excess of loss layer captive			80				36
Net premiums - Total		$	80			$	36

All premiums written by the Company under NFIP are 100% ceded to FEMA, for which WNFIC received a 29.1% gross expense allowance from January 1, 2025 through June 30, 2025. For the same period, the Company ceded $514 million of written premiums to FEMA for NFIP policies and $2 million to highly rated carriers for excess flood policies.

As of June 30, 2025 the Condensed Consolidated Balance Sheets contained reinsurance recoverable of $383 million and prepaid reinsurance premiums of $529 million, which are related to the WNFIC business. For flood policies, there was no change in the balance in the reserve for losses and loss adjustment expense net of reinsurance recoverable during the period January 1, 2025 through June 30, 2025, as the Company's direct premiums written were 100% ceded to two reinsurers. The balance of the reserve for losses and loss adjustment expense for the WNFIC, excluding related reinsurance recoverable, as of June 30, 2025 was $383 million. These balances primarily relate to claims activity from hurricane activity in 2024.

WNFIC maintains capital in excess of the minimum statutory amount of $8 million as required by regulatory authorities. The statutory capital and surplus of WNFIC was $36 million at June 30, 2025 and $44 million as of December 31, 2024. For the period from January 1, 2025 through June 30, 2025, WNFIC generated minimal statutory net income. For the period from January 1, 2024 through December 31, 2024, WNFIC generated statutory net income of $9 million. The maximum amount of ordinary dividends that WNFIC can pay in a rolling twelve month period is limited to the greater of 10% of statutory adjusted capital and surplus or 100% of adjusted net income. On June 27, 2025, WNFIC paid an ordinary dividend of $9 million. The dividend was declared and approved by the WNFIC Board of Directors on May 30, 2025. The maximum dividend payout that may be made in 2025 without prior approval is $9 million.

In December 2021, the initial funding to capitalize the quota share Captive was $6 million. This capital in addition to earnings of $31 million through June 30, 2025 is considered at risk for loss. Assumed net written and net earned premiums for the quota share Captive for the six months ended June 30, 2025, were $79 million and $36 million, respectively. For the six months ended June 30, 2025, the ultimate loss expense inclusive of incurred but not reported ("IBNR") claims was $24 million. As of June 30, 2025, the Condensed Consolidated Balance Sheet contained deferred acquisitions costs of $78 million, reinsurance payable for $5 million, and the reserve for losses and loss adjustment expense, excluding related reinsurance recoverable, was $14 million. The first collateral release was received in March 2024 and is based on an IBNR factor times earned premium compared to the current collateral balance.

The excess of loss layer Captive was renewed in June 2025 with underlying reinsurance treaties effective from June 1, 2025 through May 31, 2026. This Captive’s maximum aggregate annual underwriting exposure is $2 million per occurrence, up to $4 million.

NOTE 14 Shareholders’ Equity

Under the authorization from the Company’s Board of Directors, shares may be purchased from time to time, at the Company’s discretion and subject to the availability of stock, market conditions, the trading price of the stock, alternative uses for capital, the Company’s financial performance and other potential factors. These purchases may be carried out through open market purchases, block trades, accelerated share repurchase plans of up to $100 million each (unless otherwise approved by the Board of Directors), negotiated private transactions or pursuant to any trading plan that may be adopted in accordance with Rule 10b5-1 of the Securities Exchange Act of 1934.

The Company has outstanding approval to purchase up to approximately $249 million, in the aggregate, of the Company's outstanding common stock.

During the first quarter, the Company paid a dividend of $0.15 per share, which was approved by the Board of Directors on January 22, 2025 and paid on February 12, 2025 for a total of $43 million. During the second quarter, the Company paid a dividend of $0.15 per share, which was approved by the Board of Directors on April 28, 2025 and paid on May 21, 2025 for a total of $43 million.

On June 10, 2025, the Company entered into an Underwriting Agreement (the “Common Stock Underwriting Agreement”) with J.P. Morgan Securities LLC and BofA Securities, Inc., as representatives of the several underwriters named therein (collectively, the “Common Stock Underwriters”), with respect to the offer and sale by the Company of 43,137,254 shares of the Company’s common stock, par value $0.10 (the “Common Stock”) at a per share offering price of $102.00 for an aggregate purchase price for net proceeds of $4,315 million after underwriting discounts and fees and expenses. The Company closed the offering of the shares of Common Stock on June 12, 2025. The Company intends to use the net proceeds of the offerings of the shares of Common Stock and the Notes, together with cash on hand, to fund the cash consideration payable under the Merger Agreement and to pay fees and expenses associated with the foregoing. If the acquisition of Accession is not consummated, the Company intends to use the proceeds from the offerings of shares of common stock for general corporate purposes.

Additionally, as part of the consideration for the acquisition of Accession, the Company intends to issue approximately $1,300 million of additional shares of the Company’s common stock, par value $0.10 per share (the “Common Stock Consideration”) to the selling shareholders. The number of shares comprising the Common Stock Consideration will be determined using the $110.57 per share closing price of the Company’s common stock on June 6, 2025.

On July 23, 2025, the Board of Directors approved a quarterly cash dividend of $0.15 per share to be paid on August 20, 2025.