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DATE

Feb. 26, 2026 at 5 p.m. ET

CALL PARTICIPANTS

• Chief Executive Officer — Trevor Lowry Baldwin
• Chief Financial Officer — Bradford Lenzie Hale
• Executive Director, Investor Relations — Bonnie Bishop

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TAKEAWAYS

• Total revenue — $347.3 million for the fiscal fourth quarter ended Dec. 31, 2025, and $1.5 billion for the fiscal year as reported.
• Organic revenue growth — Three percent for the quarter and seven percent for the year, with core commissions and fees organic growth of five percent and eight percent, respectively.
• Adjusted EBITDA — $69.6 million for the quarter, up ten percent, with full-year adjusted EBITDA of $341.5 million, up nine percent.
• Adjusted EBITDA margin — 20.1% in the quarter (expansion of 100 basis points), and 22.7% for the year (expansion of 20 basis points).
• Adjusted diluted EPS — $0.31 for the quarter (15% growth), $1.67 for the year (11% growth).
• GAAP net loss — $43.7 million for the quarter ($0.37 per share), and $54.2 million for the year ($0.50 per share).
• Segment UCTS (Underwriting, Capacity & Technology Solutions) — Sixteen percent organic revenue growth in the quarter, 330 basis points of adjusted EBITDA margin expansion.
• Segment MIS (Mainstreet Insurance Solutions) — Core commissions and fees organic growth of two percent in the quarter; total organic growth negative four percent.
• Segment IAS (Insurance Advisory Solutions) — Core commissions and fees organic growth flat in the quarter; total organic growth negative two percent due to timing and procedural headwinds.
• Adjusted free cash flow — $11 million for the quarter (85% increase); $87.2 million for the year (five percent decrease driven by $15 million one-time partnership-related costs).
• Net leverage — Flat at 4.1 times in the quarter, reflecting partnership-related cash uses.
• Q4 organic growth normalization — Would have been five percent if adjusting for one-time impacts; full year would have been nine percent on the same basis.
• Medicare business impact — Disruption created a 100 basis point fourth-quarter organic growth headwind and a 70 basis point headwind for the year.
• Westwood platform revenue — $190 million pro forma for 2025; binds a policy approximately 55% of new home transactions with 85% escrowed in mortgages.
• Renters platform premium written — $280 million in 2025; 100% in proprietary products built and managed by MSI.
• Founder Shield digital platform (small commercial) — $17 million in retail brokerage revenue at year-end; client retention increased from 82% to 92% for migrated clients, margin swung positively by approximately 40 percentage points, and annual growth accelerated to 25%.
• CAC, Ovi, and Capstone partnerships — Closed Jan. 1; delivered $350 million 2025 pro forma revenue, expected to generate $400 million revenue and $110 million adjusted EBITDA post-synergies in 2026.
• Synergy execution — $25 million of $43 million CAC integration cost synergies already actioned (60%), and $11 million of $17 million revenue synergies underway.
• Vanguard colleague retention — 94% with no regrettable production talent losses in the last twelve months.
• Board-authorized share repurchase — $250 million plan accelerated and expanded, intended to be funded by excess free cash flow and potentially the revolver.
• 2026 guidance — Total revenue expected between $2.01 billion and $2.05 billion; organic growth mid-single digits or higher, double-digit organic growth run-rate by Q4; adjusted EBITDA of $460 million to $480 million; adjusted EPS of $2.00 to $2.10; free cash flow expected to grow double digits before one-time costs.
• Productivity gains from AI and Catalyst transformation — “Productivity gains upwards of 80%” reported with proprietary orchestration technology GATOR as part of broader AI integration and workflow automation initiatives.

RISKS

• CEO Baldwin acknowledged, “Fourth quarter organic revenue growth of three percent was below our historical performance and reflects several headwinds we have previously discussed, including a 22% decline in profit-sharing revenue that is largely timing related.”
• Medicare business disruptions caused a 100 basis point headwind to organic growth in the fourth quarter and a 70 basis point headwind for the year.
• IAS (Insurance Advisory Solutions) reported “rate and exposure headwinds of nearly ten percent,” leading to negative two percent total organic revenue growth in the quarter.
• MIS (Mainstreet Insurance Solutions) total organic growth was negative four percent in the quarter, reflecting QBE transition headwinds and Medicare retention challenges.

SUMMARY

Baldwin Insurance Group (BWIN +9.15%) emphasized the durability of its platform amid industry concerns over AI-driven disintermediation, highlighting structural investments in embedded and proprietary solutions that insulate multi-channel revenue streams. Management detailed early successes in synergy execution from newly closed partnerships and announced a $250 million share repurchase plan, prioritizing shareholder value due to current share price dislocation. The company issued fiscal 2026 guidance anticipating acceleration to double-digit organic revenue growth by year-end, driven by tailwinds from resolving segment headwinds, AI-led productivity initiatives, and tangible CAC integration benefits.

• Management’s framework distinguishes risk for transactional/intermediary brokerage business models, stating, “The toll collectors are clearly in trouble. The platforms are not,” and positioning Baldwin’s vertically integrated model as purpose-built for an AI-impacted era.
• AI adoption is credited for major operational shifts, with CEO Baldwin noting, “What we are seeing in the early days of some of these tools that we are rolling out is productivity gains upwards of 80%,” signaling material cost efficiency opportunities.
• The firm clarified that normalized organic growth would have reached five percent in the quarter and nine percent for the year after adjusting for temporary headwinds and accounting procedure changes, highlighting underlying growth momentum masked by nonrecurring events.
• CAC partnership integration is ahead of schedule, with $32 million of new business closed already in 2026 and $11 million of cross-sell opportunities active, supporting post-acquisition growth trajectories.
• Share repurchase is explicitly described as the most attractive capital deployment at “8x EBITDA,” with the CFO and CEO jointly reinforcing that balance sheet management will remain long-term focused despite near-term repurchases.

INDUSTRY GLOSSARY

• Embedded insurance distribution: Integration of insurance product offerings directly into non-insurance platforms or partner workflows at the point of related primary transactions (e.g., home purchase), often using proprietary technology.
• Contingent commissions: Variable payments from insurance carriers to brokers or agents based on account volume, profitability, or other negotiated criteria, often driving revenue timing volatility.
• MGA (Managing General Agency): Specialized insurance entity granted authority to underwrite, bind, and manage policies on behalf of carriers, sometimes developing proprietary insurance products and risk capital arrangements.
• Reciprocal (Reciprocal Insurance Exchange): Member-owned insurance entity operated for the benefit of policyholders, whose results or changes can impact revenue timing and recognition, particularly in transition periods.
• OG (Organic Growth): Internal growth derived from existing operations, exclusive of acquisitions or divestitures; company shorthand used repeatedly throughout the call.

Full Conference Call Transcript

Trevor Lowry Baldwin: And thank you for joining us to discuss our fourth quarter and full year 2025 results. I am joined by Bradford Lenzie Hale, Chief Financial Officer, and Bonnie Bishop, Executive Director, Investor Relations. Earlier this month, our industry experienced one of the most dramatic sell-offs in nearly two decades after the launch of AI-powered insurance applications and ChatGPT triggered fears of widespread broker disintermediation, eviscerating nearly $40 billion of market capitalization across our public broker peers in a matter of days. I wanted to start with a few direct thoughts on this, as moments like these are exactly the kinds of moments that reveal the difference between businesses that are built for the future and those that are not.

The critical question being debated today is whether AI will be a true competitor to brokers or an enabler for them. I believe the answer is both. AI will almost certainly drive a divergence of fortunes and success for talent and firms alike. Firms operating as transactional middlemen and commoditized insurance product lines should be concerned. At The Baldwin Insurance Group, Inc., based on our end markets, intentional go-to-market strategies, and the overall complexion of our business, AI is a step-function multiplier enabling significant gains in productivity and enhancing our organizational speed and agility.

I will spend a few minutes addressing how we think about this, and why at The Baldwin Insurance Group, Inc. we have been purpose-built for this era. In personal lines, which comprises approximately 38% of our total pro forma revenue, roughly 80% of that revenue emanates from embedded insurance distribution platforms, which we believe represent one of the ultimate moats in this environment. While the market is worrying about consumers asking a chatbot for insurance, in our embedded businesses we are focused on being the insurance solution of convenience, sold through a trusted partner alongside a primary transaction such as buying a home, securing a mortgage, or renting an apartment. We do not wait for our clients to search.

We are already there. Our Westwood platform, which inclusive of the Hippo business we acquired, generated $190 million in pro forma revenue in 2025, seamlessly embeds directly into the home buying experience for 20 of the top 25 homebuilders in the United States who, in aggregate, sold 57% of all new homes sold in the U.S. in 2024. When a consumer buys a new home through one of our builder partners, Westwood binds a policy roughly 55% of the time and over 85% of those bound policies are escrowed in the consumer’s mortgage payment. That is a deeply embedded, highly persistent revenue stream.

Our national mortgage and real estate platform serves as an extension of our mortgage and real estate partners’ client experiences, bringing protection directly into the consumer’s moment of home purchase and financing through our proprietary technology platform, Coverage Navigator. In 2025, we onboarded 12 new partners, including New American Funding, a top-20 mortgage originator in the U.S., who moved to our platform from a competitor and has seen dramatic increases in conversion rates. I am thrilled to announce that yesterday, we signed a 10-year exclusive agreement with Fairway Independent Mortgage Corporation, the sixth-largest independent mortgage lender in the U.S., with over 7,000 loans originated in 2024.

We currently expect to go live with Fairway on our Coverage Navigator platform in the second quarter. The growing momentum here is palpable and will drive deeper moats around our embedded business. Our renters insurance platform, which wrote over $280 million of premium in 2025, embeds directly into property management software allowing a renter to purchase an insurance policy at point of lease in under 60 seconds. 100% of the premium flowing through this channel is into our own proprietary products built and managed by our MGA platform, MSI. Overall, these embedded solutions are easier, more intuitive, and more seamless than initiating a separate process with a standalone AI agent.

We have been investing heavily in embedded solutions as a direct strategy to transform how personal insurance is bought and sold because we foresaw the risk of disintermediation through technology. We are the disruptor in this marketplace. And importantly, since early 2024, we have been building AI into these platforms and are seeing real productivity gains, including digital agents taking phone calls and binding policies when coverage discussions are not required. Now shifting gears to small commercial. This is an area where we do believe AI can positively change the insurance buying experience given the traditional brokerage economics for these small accounts are broken. High labor costs and low retention often result in low to negative margins.

Fortunately, we have been proactively disrupting ourselves here via our Founder Shield digital platform, migrating small business clients to a digitally guided experience. The results have been significant. On average, for clients who have migrated to this platform, retention increased from 82% to 92%. Margin swung positively by approximately 40 percentage points and growth accelerated to 25% annually as the digitally guided buying experience led to cross-sell and upsell. We ended 2025 with $17 million of retail brokerage revenue on this digital platform, and are in the process of migrating the remaining roughly $30 million of small business revenue onto this platform.

While small relative to our overall business, we believe this platform will be a growth driver for us over time. Importantly, we are not waiting for an AI agent to disintermediate this business, but rather are leveraging our digital-first platform to serve it better and more profitably than any human-intensive model could. Turning to our IAS segment, we have intentionally constructed a business that skews toward clients with both scale and complexity, where deep product and sector experience are critical factors in the choice of an insurance adviser. The addition of CAC amplifies that strategy, bringing substantial expertise in complex industry sectors and risk products.

Of our roughly $1 billion of pro forma IAS revenues, inclusive of CAC, approximately 70% is commercial insurance for midsize to large clients, 20% is employee benefits brokerage and consulting, and 10% is personal insurance for high-net-worth families. Approximately 80% of IAS revenue comes from clients generating at least $50,000 of revenue for The Baldwin Insurance Group, Inc., meaning they are generally spending more than $500,000 in insurance premiums across complex and sophisticated insurance program structures.

We have organized the business around industry and product, and one example I am particularly excited about is our cross-team of experts from construction, natural resources, real estate, and complex property that is serving clients involved in data center development across all phases of the life cycle, from project sponsors to developers of solar, wind, geothermal, natural gas, nuclear, and energy storage projects, to power producers and energy offtakers. This convergence of traditionally siloed practices that allows us to move at speed with rapidly changing markets is exactly the kind of advisory work that AI augments rather than replaces. Lastly, our UCTS segment wraps a strategic moat around the broader Baldwin platform.

In this business, we build and manage proprietary insurance products, we price and analyze risk, adjudicate claims, and facilitate the formation and management of third-party risk capital. AI will only enhance and accelerate our capabilities and productivity in all these domains. We have long held the view that the broker of the future—the broker for an AI world—integrates across the value chain end to end, owning the client relationship, building and managing risk transfer products, and arranging for formation and management of risk capital. The proprietary product flowing through our embedded channels further insulates us from perceived risks of disintermediation, as they are only available through us as our product and access runs through our platform exclusively.

We are incredibly excited for this moment. We are structurally set up to quickly take advantage of the operational gains afforded by AI. Quite simply, The Baldwin Insurance Group, Inc. was built for this era. With that, I will now turn to our results. Fourth quarter organic revenue growth of 3% was below our historical performance and reflects several headwinds we have previously discussed, including a 22% decline in profit-sharing revenue that is largely timing related. Core commissions and fees organic growth was 5%.

On a full-year basis, we delivered core commission and fee organic revenue growth of 8%, total organic revenue growth of 7%, adjusted EBITDA growth of 9%, 20 basis points of margin expansion, and adjusted diluted earnings per share growth of 11%. These full-year results place us at the top end of organic growth across our peer set. Normalizing for the one-time impacts from transitioning our two builder book to our reciprocal and the procedural change impacting the timing of revenue recognition in IAS, commission and fee organic growth would have been 8% in the fourth quarter and 10% for the full year 2025.

Overall, organic growth would have normalized to 5% in the fourth quarter and 9% for the full year 2025. Additionally, the disruption in the Medicare marketplace impacted our Medicare business and was a 100 basis point headwind to organic growth in the fourth quarter and a 70 basis point headwind for the full year 2025. Despite the revenue headwinds in the fourth quarter, profitability pulled through. Adjusted EBITDA margin expanded 100 basis points in the quarter to 20.1%, and adjusted diluted earnings per share grew 15% to $0.31 per share.

This was driven by the structural margin opportunity inherent across our platform, as well as core operating leverage, and was in the face of the $7 million decline in contingent commissions, which have a 100% flow-through to EBITDA. At the segment level, UCTS once again delivered outstanding results in the quarter with 16% organic growth and adjusted EBITDA margin expansion of approximately 330 basis points. Strong performance was powered by continued growth in multifamily, better-than-expected results in our commercial umbrella portfolio and builder product, and contributions from Juniper Re. In MIS, our core commission and fees organic revenue growth was 2%, while total organic growth was negative 4%, reflecting some pressure and timing of contingents.

The quarter was negatively impacted by the continued QBE transition headwind at Westwood and Medicare retention challenges. As a reminder, the year-over-year QBE commission headwind should subside in May, and we expect tailwinds over time related to the economics associated with managing the reciprocal. Normalizing for the impact of the QBE transition, total organic revenue growth would have been 2% for the quarter and 6% for the year. Further isolating out the impact of the disruption in the Medicare industry, organic revenue growth would have been 6% in the quarter and 8% for the year.

Despite the top-line headwinds, adjusted EBITDA margin expanded 460 basis points to 31.8%, an exceptional profitability result showcasing the immense operating leverage we have as our investments in building our embedded mortgage business earn in. In IAS, fourth quarter core commission and fee organic revenue growth was flat, while total organic revenue growth was negative 2%, reflecting timing pressure on contingents and rate and exposure headwinds of nearly 10%, inclusive of the procedural accounting change we have previously discussed. Removing the impact of the procedural accounting change, total organic revenue growth would have been negative 1% for the quarter and 4% for the year. Underlying business momentum remains strong.

Sales velocity was 19%, top decile for our industry, and client retention improved by nearly 300 basis points in the fourth quarter. We increased our investment in frontline revenue-generating talent by 44% in the year, taking our net unvalidated producer pay from 1.6% to 2.3% of commission and fee revenue. Our client franchise, new business pipeline, and overall business momentum is incredibly strong. We enter 2026 with optimism and excitement for our building momentum. On January 1, we closed our partnerships with CAC Group, Ovi, and Capstone.

On a combined basis, these three partnerships delivered approximately $350 million of 2025 pro forma revenue, and we expect them to deliver roughly $400 million of revenue and approximately $110 million of adjusted EBITDA post-synergies in 2026. Given the market’s understandable skepticism around synergy achievement, The Baldwin Insurance Group, Inc. and CAC teams worked diligently to action all headcount-related changes last week, which represent the largest quantum of expected expense synergies. Today, our integration efforts are ahead of schedule. New business momentum and collaboration across our collective teams is incredibly strong, and the strategic rationale for the wisdom of this business combination is playing out faster and stronger than anticipated.

As of yesterday, the CAC team has $32 million of closed-won new business in 2026 as compared to $20 million in the prior-year period, and is already actively working on $11 million of combined cross-sell opportunities with their new Baldwin colleagues, highlighting the momentum we have started the year with. Our theme for 2026 is accelerate. The Goldilocks era for insurance intermediaries is behind us. The conditions that once lifted all boats have given way to a market that rewards only those with true capability, discipline, and cohesion. At The Baldwin Insurance Group, Inc., that shift plays directly into the strategy we have been executing for years.

We have been thoughtfully assembling, piece by piece, a diversified, vertically integrated platform designed to thrive in any market cycle, not just the easy ones. Central to this acceleration is our 3B30 Catalyst program, which we launched in 2025. In 2026, Catalyst becomes operational in earnest. We are executing the first phase of role transformation within IAS, consolidating core technology platforms to improve connectivity and data clarity across the firm, and infusing AI and automation into workflows to elevate colleague impact and enhance the client experience. We expect $3 million to $5 million of Catalyst-related savings this year, ramping meaningfully in 2027 and beyond. This is how we translate AI into a tangible competitive advantage.

We remain anchored to our aspirational North Star of $3 billion in revenue and a 30% adjusted EBITDA margin over the intermediate term. And with that, I will turn it over to Brad to detail our financial results.

Bradford Lenzie Hale: Thanks, Trevor, and good afternoon, everyone. For the fourth quarter, we generated core commission and fee organic revenue growth of 5%, total organic revenue growth of 3%, and total revenue of $347.3 million. Looking at the segment level on a core commissions and fees basis, organic revenue growth was flat in IAS, 2% in MIS, and 17% in UCTS. Total organic revenue growth was negative 2% in IAS, negative 4% in MIS, and 16% in UCTS. For the full year, total revenue was $1.5 billion. Core commission and fee organic revenue growth was 8%, while total organic revenue growth was 7%. You heard Trevor speak to several idiosyncratic and market-related headwinds that impacted our 2025 financial results.

To support digestion of those comments, I would point everyone to two new slides in our investor supplement, specifically slides six and seven, that describe and quantify these impacts and bridge to a view of what normalized organic growth would have been for the consolidated business absent the idiosyncratic headwinds we have discussed. We recorded a GAAP net loss for the fourth quarter of $43.7 million, or GAAP diluted loss per share of $0.37. GAAP net loss for the full year was $54.2 million, or $0.50 per fully diluted share. Adjusted net income for the fourth quarter, which excludes share-based amortization and other one-time expenses, was $36.3 million, or $0.31 per fully diluted share, reflecting 15% growth.

For the full year, adjusted net income was $198.9 million, or $1.67 per fully diluted share, growth of 11%. A table reconciling GAAP net income to adjusted net income can be found in our earnings release and our 10-Ks filed with the SEC. Adjusted EBITDA for the fourth quarter rose 10% to $69.6 million compared to $63.2 million in the prior-year period. Adjusted EBITDA margin expanded approximately 100 basis points year over year to 20.1% for the quarter, compared to 19.1% in the prior-year period. Adjusted EBITDA for the full year grew 9% over the prior year to $341.5 million. Adjusted EBITDA margin for the full year was 22.7%, an expansion of 20 basis points year over year.

Adjusted free cash flow for the fourth quarter was $11 million, an 85% increase year over year. Adjusted free cash flow for the full year was $87.2 million, a decrease of 5% from the prior year, driven by one-time partnership-related costs of approximately $15 million in Q4 that were largely tied to the CAC Group merger and were unplanned at the time of our last call based on the timing and execution uncertainty that still existed around the CAC merger. Net leverage remained flat in the quarter at 4.1 times, as a result of those one-time partnership-related cash uses.

We took advantage of favorable market conditions in December, increasing our term loan facility by $600 million to fund the closings of CAC, Ovi, and Capstone, while maintaining our pricing of SOFR plus 250 basis points. Turning to capital allocation. I would first direct investors to the updated partnership scorecards in our earnings supplement, which highlight the meaningful value we have created through capital deployed to partnership activity. As we sit here today, the all-in blended multiple paid for all partnerships completed from 2020 to 2022, inclusive of earnouts, is 8.7x adjusted EBITDA. Specifically, I would call out Westwood, the sole partnership in the 2022 cohort and, prior to CAC, the largest partnership in the firm’s history.

In addition to giving us an incredibly strategic foothold in the new home builder channel, the financial aspects of the transaction speak for themselves, with the purchase price including earnouts now representing an adjusted EBITDA multiple of 5.6x. All of this highlights and validates our ability to attract high-quality businesses, integrate them effectively, and deliver compelling post-earnout returns for shareholders despite the overhang that earnout payments have had on our free cash flow and deleveraging trajectory. Wrapping up on capital allocation, as previewed on our last earnings call, and now given the dislocation that we believe exists in our share price today, the Board of Directors has accelerated and expanded its authorization of a $250 million share repurchase plan.

We believe it is in the long-term best interests of our shareholders to take advantage of this opportunity by acquiring shares of the business we know best—our own—funded through excess free cash flow and, if deemed prudent, periodic use of our revolver. Moving to guidance, which we are updating to reflect the CAC Group merger. For the full year, we expect total revenue between $2.01 billion and $2.05 billion and organic growth of mid-single digits or higher. As we have discussed, we expect organic revenue growth to ramp throughout the year, reaching double digits by the fourth quarter as we lapse both the QBE commission headwind in MIS and the procedural accounting change in IAS.

We expect adjusted EBITDA between $460 million and $480 million, representing adjusted EBITDA margin expansion of 20 to 70 basis points. We expect double-digit growth in adjusted free cash flow before one-time transformation and integration costs. Adjusted diluted earnings per share between $2.00 and $2.10. One housekeeping note, I would point everyone to slide 24 of our investor supplement, which lays out historical timing of CAC Group revenue and should help inform model updates. For 2026, we expect revenue between $520 million and $530 million and organic revenue growth in the low single digits. We anticipate adjusted EBITDA between $130 million and $140 million and adjusted diluted EPS between $0.61 and $0.65 per share.

2025 was a year of meaningful progress for The Baldwin Insurance Group, Inc. We delivered our sixth consecutive year of top-of-industry organic growth, expanded margins, and grew adjusted EPS by double digits. The actions we are taking to execute on CAC synergies, advance our Catalyst transformation program, scale our embedded and MGA platforms, and grow investments in frontline revenue-generating talent reflect our conviction in the durability and value of this platform. We sincerely thank our clients for placing their trust in us, our colleagues for their tireless dedication, and our shareholders for their continued support and patience. I will now hand it back to Trevor.

Trevor Lowry Baldwin: Thank you, Brad. In closing, against the backdrop of relatively strong consolidated results in the wake of many idiosyncratic and market-driven headwinds, I want to acknowledge to our shareholders what has been a year of uneven financial performance, one that does not ultimately measure up to our own high expectations.

Despite this, our business is entering 2026 well positioned to accelerate performance, with strong underlying momentum across all three of our segments, incredibly encouraging early wins and synergy realization at CAC, innovation taking place across the value chain as we continue to bring clients and risk capital closer together, and investments we have been making in automations and AI that we expect to drive meaningful gains in productivity and accelerated client value and impact. In many ways, our growth story is entering its most consequential chapter. Our business was purpose-built for this era, and we are excited about our ability to demonstrate that to all of our stakeholders.

To wrap up with our prepared remarks, I want to share how proud I am of the way our colleagues navigated a complex environment in 2025. I want to thank our clients and insurance company partners for their trust, our colleagues for their resilience and commitment, and our shareholders for their support in what has been a bruising year. With significant colleague ownership, our alignment is deep and enduring as we build long-term value together. We will now open for questions. Operator?

Operator: Thank you. We will now be conducting a question-and-answer session. If you would like to ask a question, please press 1 on your telephone keypad. You may press 2 to remove yourself from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star key. Your first question comes from Thomas Patrick McJoynt-Griffith with KBW. Please go ahead.

Thomas Patrick McJoynt-Griffith: Hey, good evening, guys. Thanks for taking our questions. The first one here is, appreciate all your comments there at the beginning about what is happening with AI and the threats of disruption there and your competitive positioning. Maybe just want to ask you to expand a little bit on that. You know, if I think about, for instance, like, an embedded solution, like renters, to the extent that it does become easier for somebody to build some software or some program in an automated fashion, how do you think about your moat, your defensive positioning to maintain your structure with clients that would prevent you from being disrupted in a product like that.

Trevor Lowry Baldwin: Yeah. Hey, Tommy. This is Trevor. Good evening, and great question. I think, look, the narrative that AI replaces brokers is just far too simple. I think what AI actually does is it accelerates the divergence that was, frankly, already underway between platforms that own distribution, that manufacture risk products, that source and manage risk capital, and that ultimately embed themselves in the customer’s workflows and ecosystems, from those intermediaries that are simply in the middle and take a toll. The toll collectors are clearly in trouble. The platforms are not. And in fact, I believe the platforms are about to enter a true golden age.

At The Baldwin Insurance Group, Inc., we have been laser focused not on building a brokerage, but on building an insurance platform. And we think about our platform through three lenses that I think directly map to the framework of why we believe there is a lack of fragility around this overall business model and ecosystem that we have created. The first is embedded distribution. Specific to renters, we are at point of lease through our property management software partners, embedded and built natively into the workflow in their system, and 100% of the premium throughput through the various renters products that is purchased via that channel is our own proprietary product. You cannot get it anywhere else.

And so if you want our product, you have to come through our platform. In addition to that, we are arranging and managing the risk capital that sits behind that product. So we control the entire value chain associated with how those renters insurance solutions are ultimately brought to bear, priced, adjudicated, and how those renters customers are taken care of. So that is one example. It is a similar dynamic across our builder and mortgage channels with proprietary product, proprietary technology, and I would tell you none of these areas are the core business functions of our channel ecosystem partners.

What they are looking for is a high-quality partner that gives them certainty around execution and confidence that we are going to be able to uphold and deliver an ultimate client experience that is consistent with their overall experiential goals. So when you think about our broader platform, it is embedded distribution, it is advisory complexity—I talked earlier in my prepared remarks around both scale and complexity of the type of clients that we serve and the end markets that we are serving them in—and then it is vertical integration.

We do not just distribute products—we do—we own the customers, we are the retailer, but we also build and manufacture the proprietary product, then we source, arrange, and manage the risk capital that sits behind them. And I think that is a central theme to why the platforms will not only survive but thrive in the world of AI and all of its impacts on knowledge work.

Thomas Patrick McJoynt-Griffith: Great. Thanks for that. And then appreciate on slide seven your quantification of the idiosyncratic end market headwinds. I just want to ask you to unpack your expectations in terms of what is embedded in your guidance for the fourth one there, the market headwinds. Are you contemplating any deceleration in casualty rates? Is it a matter of property rates stabilizing at midyear? What is embedded in that?

Trevor Lowry Baldwin: Yeah. I mean, we are expecting continued headwinds through most of 2026 from an overall market impact standpoint, with that fading through the year to more of a neutral impact by the time the year wraps up. And that is less a function of the absolute rate, which we believe will continue to decrease and be competitive in property. We do believe rates will continue to ebb in casualty, and it is more a function of rate of change. And so what you saw in the fourth quarter is a rate of change of 1,500 basis points of total market impact because we swung from a positive 500 basis point tailwind in 2024 to a 10% headwind in 2025.

There are some nuances to that headwind, predominantly around our benefits business, which drove most of that, where we saw another quarter of pretty meaningful exposure compression. So that is not a rate dynamic. That is an exposure dynamic in our benefits business. But I would also tell you, we now have visibility into January renewals where we renew about 40% of our overall employee benefits revenue for the year, and we saw a combined rate and exposure increase in January.

So I think the back half of 2025 we saw pretty meaningful exposure compression across our benefits clients, which I believe is reflective of some of the structural workforce transformation that is occurring as a result of AI across white-collar, knowledge-based businesses—technology a big cohort of which exists across our client base. So while I called a floor in 2025, I clearly got that wrong. I feel really good about the fact that the headwinds will slowly subside through the year. We have got finite hard end dates around the QBE builder transition and the IAS revenue recognition procedural change.

We have got pretty good visibility into the Medicare disruption that occurred in 2025 largely stabilizing, not expecting that business to go back to meaningful growth anytime soon, but I think the headwinds we face should largely subside there. And that is all what informs that mid-single-digit or higher organic guide that ultimately culminates into double-digit organic growth on a run-rate basis by the fourth quarter.

Thomas Patrick McJoynt-Griffith: Thanks.

Trevor Lowry Baldwin: Thanks, Tommy. Next question.

Operator: Charles William Lederer with BMO Capital Markets.

Charles William Lederer: Great. Thanks. You mentioned the growth in unvalidated producers. Can you provide color about how much your hiring strategy in IAS has been adding to sales velocity and how we should think about how that strategy plays in a softer market environment?

Trevor Lowry Baldwin: Yeah. So we increased our investment in frontline revenue-generating talent by about 70 basis points in the IAS business, Charlie. And I would not think about that as having a material impact in-year on sales velocity just because of the typical ramp time period associated with a lot of that talent. So the sales velocity for the year of around 19%, which, by the way, compares to an industry median of about 11% and a 75th percentile of about 15.5%, so continuing to perform at top-decile results from a new business generation standpoint, is largely from risk advisers that have been on the platform for more than 12 months.

The folks in the investment ramp that occurred in 2025 should begin building into new business and sales results into 2026, and fully in 2027.

Charles William Lederer: Thanks. And then maybe on the MIS side, I guess, how should we think about the cadence there? Obviously, you lap QBE impacts, I think, in May. On the homebuilder side, how is the underlying momentum there? And are you still ramping new partners there? And on the mortgage side, I know you announced a new partnership. Thanks.

Trevor Lowry Baldwin: Yeah. So, look, normalizing for the impact of QBE transition, Westwood’s organic growth for the year was 9.5%. So that business continues to perform quite well despite what has become a little bit of a softer overall builder market. We feel really good about our position with 20 of the top 25 homebuilders in the country, which accounted for more than 57% of all homes built in the U.S., as our partners, and we continue to take share with new builders. And I would say that the integration with Hippo and the builder partners that came over from that transaction has gone incredibly well.

We are already through the TSA, they are fully on our proprietary tech Advantage Plus, and that business is humming along. So I think there is an expectation for builder volumes to be down somewhat in 2026, but I would remind everyone that 90-plus percent of the revenue in the Westwood platform comes from renewals, and so the impact of builder volumes does not have a straight pull-through impact to the overall momentum in the Westwood business. That business continues to perform exceptionally well. Our mortgage business is doing fantastic. You saw most likely yesterday the announcement around our new partnership with Fairway Mortgage Corporation, the sixth-largest independent mortgage lender in the country.

Just a huge validation of the value of our technology platform and how that can enhance and accelerate the insurance buying experience at point of mortgage and origination. In fact, Fairway already had its own sub-agency they were operating, and they ultimately came to the conclusion that they would be better off partnering with us because of the power of our technology, rather than continuing to go it alone with their own insurance agencies. So in conjunction with that partnership, we will be acquiring their small agency. It is about $1 million of revenue, so not substantial, and plugging them into our Coverage Navigator tech platform to accelerate momentum.

The pipeline we have in the mortgage and real estate sector is quite large—over 45 providers that, in theory, would generate over $90 million first-year new business revenue. So we are actively working that pipeline, showcasing the value of our tech and how it truly enhances and elevates the overall mortgage origination process and experience.

Operator: Thank you. Gregory Peters with Raymond James. Please proceed.

Gregory Peters: Hello. Good afternoon, Team Baldwin. Trevor, you mentioned in your comments a couple of times about the precipitous decline of your stock price. You highlighted the fact that so many of the employees at the company are also shareholders. So I guess I have two questions for you considering what has happened. First, can you talk about retention? I think your highest level of the producers, or the Vanguard producers—I think that is what you call them. Anyways, can you talk about retention? And then the second part of the stock price question is, I am sure this goes all the way up to the Board.

Is there any perspective of what you can do differently going forward other than just simple execution that will help restore confidence in stock price? Or is there a shift in strategy that you are contemplating? Obviously, the share repurchase is a significant step, but I am just curious about what is going on in the mindset in the company there right now.

Trevor Lowry Baldwin: Yeah. Hey, Greg. Great question. So let us hit retention first. Look, none of our colleagues are happy or excited about share price performance over the past 12 months, and there is definitely frustration around that. But it is not impacting retention. Vanguard colleague retention was 94%, so continues to be exceptionally high. We have not had any regrettable production talent losses over the past 12 months. I know there have been a lot of headlines around some pretty broad-based talent defections across various industries.

I would just say, one, we do not think very highly of some of the tactics that are being employed by many of these newer entrants who seem to be somewhat disregarding the type of approach that I think good, self-respecting, and competitive businesses take to winning talent. We are full believers in portability of talent, and I think the power of our platform, the strength of our culture, and ultimately the realization for our industry’s very best professionals that they can build the most rewarding and impactful careers here at Baldwin speaks through in the strength of our retention. But, ultimately, we need our results to translate into share price performance over time.

I think we can point to a number of examples of incredibly successful public companies who have gone through periods of dislocation and misunderstanding that has impacted their share price performance, but it feels like we have been there longer than most now over the past few years. To speak directly to some of what has ultimately driven some of that share price performance, we have got to manage expectations better. We came out, and we have had to reset expectations for a variety of reasons—some specific to us, some market driven.

That obviously does not create confidence, and so what you are seeing in the expectations that we have laid out are a set of financial targets that we believe are quite achievable. I think when you look at the overall performance of our business through most any financial lens over the past six years since we went public, it is pretty remarkable. We have taken a business from $135 million of revenue to what is today, on a pro forma run-rate basis, over $2 billion. We have grown earnings on a per share basis nearly at a 40% CAGR and free cash flow at a 45% CAGR.

But we know there are things we have got to do to improve the overall financial profile of the business. We have got to continue to stay focused and disciplined around delevering. We have got to drive a realization of better free cash flow conversion. And, ultimately, we have got to continue to deliver the outsized organic growth that has been a hallmark of our success over the years. I, today, am as confident as I have ever been, Greg, about the unique competitive position we are in and how purpose-built we are for this era and the impact of AI. As I mentioned earlier, we have not been focused on building a brokerage.

We have been focused on building an insurance platform that enables us to play across the ecosystem in a way that uniquely positions us to solve challenges and to ultimately build enduring moats around our competitive advantages. So our business is well positioned coming into 2026. The quality and the strength of our talent has never been better. The addition of CAC just continues to add to that as you think about the level of expertise we have in complex upmarket risk and insurance opportunities, and the momentum is palpable.

I mean, you heard some of the remarks I shared—the new business success that CAC has come into the year with: closed-won new business up over 50%, $11 million of active cross-sell business being worked on collaboratively between The Baldwin Insurance Group, Inc. and CAC teams. It is incredibly exciting. But we are not closing our eyes to the reality that there are some things around our financial profile that we have got to make real progress on, and we are committed to doing that.

Gregory Peters: So I appreciate your comments there, and I want to focus on two pieces of your answer at the end that I think are important, and it is the deleveraging and the free cash flow component. And I guess what I am struggling with is how you are going to deliver on those two metrics while at the same time aspiring to grow to $3 billion of revenue. Because I feel like, based on your original vision, that was going to require some more acquisitions. So maybe speak to just sort of how you are thinking about the deleveraging, free cash flow components of that answer. Thank you, Trevor.

Trevor Lowry Baldwin: Yeah, Greg. We have got to drive meaningful margin accretion in the business, and we are actively doing that. If you look at the CAC integration, we outlined $43 million of cost synergies to be achieved over three years, and we have already actioned $25 million of them. We are two months in; 60% of expected cost synergies are actioned. And of the $17 million of revenue synergies that we had, we are already working on $11 million worth, 60 days in.

So it is about continuing to transform our business, which is what 3B30 Catalyst is all about, which is repositioning the way in which work gets done across our business to leverage the advantages of artificial intelligence, and we are doing that. We, over the past 90 days, built our own proprietary orchestration layer, GATOR, that enables us to have synchronous and asynchronous coordination of workflows that are fully automated, to be able to truly elevate and enhance the type of work that our professionals are doing while driving more seamless, more effective, and more real-time interactions for our colleagues through the advantages of AI.

What we are seeing in the early days of some of these tools that we are rolling out is productivity gains upwards of 80%. To say that AI is going to have an impact or even transform businesses in our industry is probably the understatement of the day. The opportunity we have ahead of us here is immense, and we are going to unlock meaningful margin while accelerating organic growth. And that will put us in a position to be able to both delever the business through scale while also having it be in the position over time to be thoughtful around M&A.

Bradford Lenzie Hale: Greg, just want to add. Again, in the last two quarters, we have actually had quite a strong trend in the growth in adjusted free cash flow. In Q3, adjusted free cash flow from operations was up 26%. In Q4, it was up 85%, and Q4 was in the face of approximately $15 million of partnership-related expenses for the January 2026 deals, which was unplanned. As we delever the business, as Trevor articulated, we would expect our free cash flow conversion to migrate to peer levels. With respect to leverage, I want to be clear how we think about the balance sheet. Our long-term target leverage remains three to four times. Nothing about today’s announcement around buybacks changes that destination.

What we are saying is that the path to that destination should be optimized for total shareholder value, not optimized for arriving at the lowest leverage ratio in the shortest possible time. We have no near-term maturities of consequence. In this context, mechanically deleveraging from 4.1x to 3.5x six months faster while our equity trades at a material discount to where we believe intrinsic value sits would be, in our view, a destruction of shareholder value and not a creation of it. So we are looking at this the same way we have always looked at it, on a long-term basis, and are committed to that path.

Gregory Peters: Got it. Thank you for the answers.

Trevor Lowry Baldwin: Thanks, Greg. Next question.

Operator: Elyse Greenspan with Wells Fargo. Please go ahead.

Elyse Greenspan: Hi, thanks. Good evening. My first question on organic growth, with the mid-single-digit guidance for 2026, I was just hoping that you can give some color on what the outlook is by business. And then a second part, keeping with organic growth, obviously you guys highlighted some specific headwinds, and I know they were called out on the slides. But within your organic growth guidance for 2026, are you assuming any of the businesses start off the year in negative territory, just because obviously the cadence is organic improving during the year?

Trevor Lowry Baldwin: Yeah. Hey, Elyse. We are not going to get into segment-specific outlooks here. What I would tell you is the headwinds, which all have finite end dates over the course of 2026, are incorporated into that mid-single-digit or higher guidance. It was not just mid-single—we would point that out. We expect OG to return to double digits by the fourth quarter, and we would not expect negative OG in any of the segments going forward.

Elyse Greenspan: That is helpful. And then, for the share repurchase program, the $250 million, in the slides, it says opportunistic share repurchases. So within the EPS guidance that you have outlined, what is that assuming of the $250 million that is bought back during the year?

Trevor Lowry Baldwin: We are not assuming share repurchases right now, Elyse. Our appetite is going to be opportunistic based on where the shares trade. As share price goes up, our capital allocation priorities will shift. I think if you assume we deployed $125 million of capital into a share repurchase program over the year, that would result in about a 3% accretion.

Elyse Greenspan: And then from—we are almost two months into Q1—what have you seen from a market impact, so rate and exposure impact, quarter to date? And has there been any change in what you observed quarter to date relative to the fourth quarter?

Trevor Lowry Baldwin: Yeah. As I mentioned earlier, we have got pretty good visibility into 1/1 employee benefit renewals now, and we did not see the same exposure weakness in those 1/1 renewals that we had seen in the third and fourth quarters.

Bradford Lenzie Hale: And, Elyse, just to clarify one comment. We would not expect negative organic across any of the segments for the full year. We do expect MIS to continue to be pressured in Q1 before the transition date on QBE at 04/30, so just wanted to note that.

Operator: Thank you. Next question, Pablo Singzon with JPMorgan. Please go ahead.

Pablo Singzon: Hi, good evening. Trevor, I think it is clear from your comments that you are somewhat bearish about personal lines sold in the open market rather than embedded. So is your view here what the market seems to be assuming—like, something like digital AI agents will be able to quote and bind on their own, and insurers will be willing to provide them with bindable quotes? I appreciate the sort of what is happening in some way embedded, in a more controlled environment where you own the platform, but do you think that is actually what happens in the open market as well?

Trevor Lowry Baldwin: You know, Pablo, I do not know that I would go so far as to say that. I would say that there is already about 35% of the personal lines insurance market that proactively price shops today and goes direct. And so do those proactive price shoppers end up on an AI-driven comparison platform rather than going direct into a GEICO or Progressive website? Maybe. At the same time, I am not sure insurance companies are going to be super excited to open up their quoting algorithms and APIs to a bunch of AI-driven chatbots. There is real risk and concern around the channels through which business comes and the impact it has on loss ratios.

There is real cost to quoting business. You have to run credit. There are data feeds and data pulls. And so these insurance companies, they are very sensitive to quote-to-bind ratios. And if you hooked up an AI engine to one of these companies and just started redlining on quotes, they would shut you down in less than 24 hours. So I think undoubtedly, the way in which personal insurance is going to be bought and sold is going to evolve, and AI is going to have a huge impact on that.

I believe quite strongly, and we have got some real proof points as recently as yesterday with Fairway Mortgage, that embedded distribution is a big part of the future. It is not going to be the entire future, but it is going to be a big part of it. And different people have different buying habits and proclivities. Some people prefer a buying experience that is fully embedded inside the trusted partner’s ecosystem and the natural workflow that they are going through.

And so long as they are presented with choice, they are done so quickly, and they are provided with a buying or shopping experience that gives them confidence that the market has been adequately shopped to give them the right coverage at the most competitive price, then they are not going to feel compelled to go out to a third-party chatbot-driven insurance platform, or Google, or whatever—pick your direct-to-consumer platform. So we believe embedded is one of the biggest net winners here, and that is why we have been so focused on building out that channel for the last four to five years.

Pablo Singzon: Okay. Thank you, Trevor.

Operator: Next question, Joshua David Shanker with Bank of America. Please go ahead.

Joshua David Shanker: Yes. Thank you for taking my question late in the hour. A couple of years ago, the stock was soft. You did a lot of M&A. You argue it was the right M&A to do and it has paid dividends, but the market did not like it. And you said, look, we are going to show you how much cash flow this company generates, and we are going to forestall future M&A to show that to you. And along came the CAC deal, and you could not resist such a deal. It was a great deal for you, and the stock did the same thing.

That may not be the only reason why the stock did the same thing, but I understand your view that you could not pass up the opportunity. Right now, your stock is at $18 a share. You have announced a share repurchase program, but you are not making any real commitments about how you are going to actively execute that program. If buying CAC was such an emergency that could not be helped even though it sort of pushed on what you had told investors you wanted to do, how does that apply to the stock today and how you think about share repurchase? Is there not an emergency right now that you need to act?

Trevor Lowry Baldwin: Josh, at 8x EBITDA, there is not a better use of capital than buying our own shares. And that is why the share repurchase program has been authorized. And at 8x EBITDA, we will be actively buying our stock.

Joshua David Shanker: And when you say that is for the next 12 months, should we expect if the stock is not going that direction, you will fully exhaust that buyback this year?

Trevor Lowry Baldwin: I am not going to opine on exactly how much or how quickly we are going to deploy, but from a capital allocation standpoint, Josh, there is no better use of capital than acquiring our own shares of the business we know best at a significant discount to what I can buy far smaller, far lower-quality insurance brokerage businesses for in the open market. Not even a question.

Joshua David Shanker: Okay. Thank you for the clear answer. Yep.

Operator: Next question, Andrew Kligerman with TD Securities. Please go ahead.

Andrew Kligerman: Yeah, and thanks for that clarification around Josh’s question. It sounds like you have a real interest in repurchase. I just personally as well was not as sure because you said that you have not modeled any buyback into your leverage going forward. So thanks for that clarification. Trevor, you mentioned at the beginning of the call that it is important to set expectations and, I believe, execute on those expectations. And I kind of look at this quarter, and you did the CAC deal, you had a call in December, and your organic growth objective was mid-single digit for the quarter. It came in at 3%.

The organic growth for this year now was mid to high; now it is mid or higher—or no, it is high; now it is mid to higher. So part of that—and I think the quarter was super high quality; it is just this is sort of like missing a putt—but at the same time, I would like to know how confident are you in this new organic guidance of mid to higher? And by the way, you hit all the numbers on EBITDA and overall revenue.

So, again, I do not think it was a big deal, but I would like to know what is your degree of confidence now that you have set the guidance at the beginning of the year?

Trevor Lowry Baldwin: Yes. Andrew, I mean, if we look at fourth quarter specifically, the driver of the gap in organic was the severity of rate and exposure headwinds we faced in IAS. That was more than we were anticipating, and that was predominantly driven by weakness in exposure in our employee benefits business. We believe where we have set expectations for 2026 is imminently achievable, and that is what we are focused on executing on.

Andrew Kligerman: Got it. Thank you for that, Trevor. And then as I look at the IAS in the fourth quarter, the point swing—rate—you know, that 1,530 basis as you kind of model out in IAS for the year, what are you overall modeling in terms of a number for year-over-year rate change or decrease?

Trevor Lowry Baldwin: Yes. We still expect rate and exposures to be a net headwind for the year. But we expect that headwind to dissipate as the year goes on, particularly as we get into what will be some relatively friendly comps, particularly in the fourth quarter. So I would expect it to be a headwind in the first couple of quarters before becoming more neutral. And, overall, I would characterize it as a slight headwind for the year.

Andrew Kligerman: I see. So a slight headwind being, like, single for the year, but maybe double digits in the first half. Does that seem—

Trevor Lowry Baldwin: I would not expect rate and exposure to be a double-digit headwind. Remember, the rate of change is so severe in 2025 because it was going from positive to negative. But when you are going from negative to negative, you are not going to see the same rate of change.

Andrew Kligerman: Got it. Thank you so much.

Trevor Lowry Baldwin: Thank you, Andrew.

Operator: I would like to turn the floor over to Trevor Baldwin for closing remarks.

Trevor Lowry Baldwin: Thank you all for joining us on the call this evening. We are excited for the growing momentum we have across our business in 2026. In closing, I want to thank our colleagues for their hard work and dedication to delivering innovative solutions and exceptional results for our clients. I also want to thank our clients for their continued trust and confidence in our teams. Thank you all very much, and we look forward to speaking to you again next quarter.

Operator: This concludes today’s teleconference. You may disconnect your lines at this time, and we thank you for your participation.