Michael Heaton
About Michael Heaton
Michael (Mike) Heaton, 48, is an Executive Vice President & Chief Operating Officer at Markel Group Inc., overseeing day-to-day holding company operations, including five insurance businesses. He was nominated by Markel under Hagerty’s Investor Rights Agreement to stand for election to Hagerty’s Board at the June 3, 2025 annual meeting, filling the vacancy from F. Michael Crowley’s decision not to stand for re-election; the Board has determined all nominees other than the CEO are independent under NYSE rules. Heaton joined Markel in 2008 as President & COO of Markel Ventures and led Markel’s 2021 transformation into a diversified holding entity. He holds a B.A. in Economics (BYU) and an MBA (UVA Darden).
Past Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| Markel Group Inc. | Executive Vice President & Chief Operating Officer | Current (nominated to HGTY board in 2025) | Oversees holding company operations across five insurance businesses |
| Markel Ventures (Markel subsidiary) | President & COO | Since 2008 | Key role in expanding Markel’s portfolio |
| Markel Group Inc. | Transformation Leader | 2021 | Led transformation into a diversified holding entity; reshaped vision, structure, governance |
| Various (early career) | Entrepreneurial and operational roles | Not disclosed | Not disclosed |
External Roles
| Organization | Role | Tenure | Notes |
|---|---|---|---|
| CapTech | Director | Not disclosed | Corporate board service referenced |
| Brahmin | Director | Not disclosed | Corporate board service referenced |
| Lansing Building Products | Director | Not disclosed | Corporate board service referenced |
| Costa Farms | Director | Not disclosed | Corporate board service referenced |
Board Governance
- Nomination/independence: On April 16, 2025 Hagerty disclosed that Markel exercised its nomination right to nominate Heaton; Board deems all nominees other than the CEO independent under NYSE rules.
- Committee assignments: Not disclosed for Heaton in the 2025 proxy (current committee rosters list other directors).
- Board structure: Combined Chair/CEO (McKeel Hagerty) with a Lead Independent Director (Bill Swanson) who leads executive sessions and has agenda/schedule authority.
- Controlled company: Hagerty is a “controlled company” under NYSE due to HHC’s voting control; it currently relies only on the exemption allowing a non-fully independent Nominating & Governance Committee (3 independent + 1 management director).
- Meeting cadence/attendance context: In 2024, Board held 7 meetings; committees held 6 (Audit), 10 (Compensation), 5 (Nominating & Governance), and 8 (Finance & Capital). All sitting directors attended at least 75% (Heaton was not a director in 2024).
Committee chairs (context): Audit—Laurie Harris; Compensation—Sabrina Kay; Nominating & Governance—Bill Swanson; Finance & Capital—Rob Kauffman.
Fixed Compensation (Non-Employee Director Program)
| Component | Amount/Terms |
|---|---|
| Annual Retainer (cash) | $85,000 (from April 1, 2025) |
| Annual Equity | RSUs with fair value $125,000 at 3/31/2025 close; vest 100% on 4/1/2026 |
| Additional Retainers | Chair of Board: $75,000; Lead Director: $30,000; Committee Chairs: Audit $20,000; Compensation $15,000; Nominating & Governance $10,000; Finance & Capital $10,000 |
| Committee Member Retainers | Audit $10,000; Compensation $7,500; Nominating & Governance $5,000; Finance & Capital $5,000 |
| Hagerty Re Board | Additional $5,000 |
| 2024 context (for incumbents) | Directors were paid $85,000 cash retainer and $90,000 RSUs (vested 4/1/2025) with similar committee retainers |
Notes: Employee directors receive no board compensation. Expenses reimbursed.
Performance Compensation (Director)
| Element | Design | Metrics/Vesting |
|---|---|---|
| Annual RSUs | Time-based | 100% vest on first anniversary of grant (e.g., 4/1/2026 for 2025 program); no performance metrics disclosed for directors |
Other Directorships & Interlocks
| Entity | Relationship | Key Terms/Amounts (2024) | Governance Implication |
|---|---|---|---|
| Markel Group Inc. | Heaton EVP & COO; Markel holds director nomination right | Investor Rights Agreement grants Markel 1 director nominee and preemptive rights while thresholds met | Interlock: Markel is a major related party; Heaton is a Markel executive |
| Markel ownership | Significant holder | Beneficial ownership equivalent to 22.8% of outstanding common stock; components include Class V and Class A shares | Strategic influence; potential perceived conflict given business ties |
| Markel alliance | Strategic underwriting partner | $388.0M commission revenue earned by Hagerty in 2024 under Markel agreements (vs. $340.5M in 2023) | Material related-party economics requiring oversight |
| Markel reinsurance | Quota-share arrangements | $662.8M earned premium revenue assumed by Hagerty Re in 2024 (vs. $535.4M in 2023) | Risk-sharing with related party; oversight via Audit/Finance committees |
| Preferred stock | Investor payments | $1.05M dividends paid to Markel on 6/24/2024 | Ongoing cash flows to related party |
| Warrant exchange | Equity issuance | 108,000 Class A shares issued to Markel in July 2024 exchange | Incremental equity allocation to related party |
| Tax distributions | LLC agreement | $1.3M tax distributions to Markel in 2024 | Structural tax-sharing; requires transparency |
| Tax Receivable Agreement | TRA with Markel/HHC | Hagerty pays 85% of realized tax savings tied to basis step-ups and related items | Long-duration cash outflows tied to exchanges |
Expertise & Qualifications
- Specialty insurance/core operations leadership; capital allocation and portfolio expansion experience (Markel/Markel Ventures).
- Governance/operating transformation (led 2021 restructuring into diversified holding entity).
- Education: B.A. Economics (Brigham Young University); MBA (UVA Darden).
Equity Ownership
| Item | Status/Detail |
|---|---|
| Individual HGTY ownership | Not listed among named executive officers and directors in the April 4, 2025 beneficial ownership table (Heaton is a 2025 nominee, not a 2024 director) |
| Related-party holdings | Markel Group Inc. beneficially owns the equivalent of 22.8% of outstanding common stock as of April 4, 2025 |
| Director stock ownership guideline | 5x annual retainer ($425,000 at current retainer), with 5 years to comply |
| Anti-hedging/pledging | Hedging and pledging prohibited without Board and CLO approval under Insider Trading Policy |
Insider Trades (Section 16)
| Date | Filer | Form | Security | Notes |
|---|---|---|---|---|
| Not disclosed for Michael Heaton in 2024 | — | — | — | Heaton was a 2025 director nominee; Proxy’s Section 16(a) discussion notes one late filing (Kevin Delaney), with no mention of Heaton |
Governance Assessment
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Strengths
- Deep specialty insurance and capital allocation expertise aligned with Hagerty’s core underwriting/agency model; likely to enhance Finance & Capital discussions and strategic oversight.
- Board affirms Heaton’s independence under NYSE rules; Lead Independent Director provides counterbalance to combined Chair/CEO structure.
- Robust related-person transactions policy with Nominating & Governance Committee review/approval, including standards for third-party comparability.
-
Risks and RED FLAGS
- Markel is a major related party and strategic partner with material economic flows (e.g., $388.0M commissions; $662.8M earned premium revenue; dividends, warrant equity, TRA/tax distributions), while Heaton is a senior Markel executive—heightened conflict risk and need for recusals, independent oversight, and transparent disclosures.
- Controlled-company status reduces certain NYSE governance requirements; Hagerty currently uses the exemption only for Nominating & Governance composition, but investors should monitor committee independence, particularly for related-party approvals.
-
Investor confidence implications
- If elected, Heaton’s operational acumen could strengthen board effectiveness in risk/capital management; however, the Markel interlocks make robust committee process (independent membership, recusals, and rigorous related-party benchmarking) essential to sustain minority shareholder protections.
Monitoring items for investors: (i) post-election committee assignments and any chair roles for Heaton, (ii) the scope and pricing of Markel-aligned agreements (underwriting, reinsurance, services), (iii) recusal practices and N&G approvals on related-party matters, and (iv) director equity accumulation under the ownership guideline to reinforce alignment.