00:00:02 Speaker 1: Bloomberg Audio Studios, Podcasts, radio News. 00:00:08 Speaker 2: This week on the podcast, another extra special guest, Mkhil Haggerty is chairman and CEO of Haggarty Specialty Insurance. 00:00:17 Speaker 1: Fascinating company. They took a little. 00:00:19 Speaker 2: Niche wooden boat insure and turned it into a publicly traded company by. 00:00:25 Speaker 1: Embracing the community around. 00:00:27 Speaker 2: Collector cars, trucks, boats, etc. I thought this conversation was really quite fascinating, not just as a car guy, but as a business guy, and I think you will also with no further ado, my conversation with Haggarty's Mkhil Haggarty. 00:00:54 Speaker 3: Mkhil Haggarty, Welcome to Bloomberg. Thanks for having me. 00:00:58 Speaker 1: So let's start with your backroun. 00:01:00 Speaker 2: You get a BA in English and Philosophy from Pepperdine and then you get a master's in theology at Saint Vladimir's Orthodox Theological Seminary. 00:01:12 Speaker 3: What was the plan to become a priest? Yeah, I kind of. 00:01:16 Speaker 4: I think about my academic career in a couple of phases. Like I was, I was an entrepreneur from the time I was young. I had a bunch of businesses when I was very young and thought I would go study business in college, and I ended up falling in love with philosophy and literature and all these things was philosophy and English major. I was a good student, and I thought I'd get my PhD. But I needed a little break to work on languages and some things. And I learned about Saint Ladimirs which is just north of New York here. It's been kind of near Rye or Scarsdale, and it was this incredible experience because I, you know, I got to work on my languages. I learned a lot about leadership actually at the ee'min area because there's some pretty extraordinary individuals there. And then there is no doubt about it. You are there to study to become a priest. And while that was not my driving reason to go there, they kind of it's a little bit like Michael Corleoni. They kind of drag you in and you know, before you know it, you're suddenly thinking about becoming a priest. I didn't become a priest because then I moved on and started my doctor work in philosophy up in Boston and did not complete that because the family business called and I had worked in it during the summers up until then, and you know, with mom and dad, my two sisters, and all of a sudden, I found myself no longer thinking about exams and dissertation and all those things, and thinking about this really cool business. 00:02:45 Speaker 1: So let's talk. 00:02:46 Speaker 2: About this this business. The hagiography is your parents, Frank and Louise. They started Haggarty Insurance Agency in Traverse City, Michigan, for what I never would have guessed was an actual business elector wooden boat. 00:03:01 Speaker 3: That's right, Like, is are. 00:03:02 Speaker 2: There enough collector wooden boats to sustain a full business? 00:03:06 Speaker 1: There is? 00:03:07 Speaker 4: There are enough wooden boats to ensure to sustain a very small family business, you know, with a few employees. It was kind of a retirement gig for my mom and dad. They had had a general insurance agency and they sold that and they wanted something else to do. And they thought, but there were a couple of principles that were in the back of their mind, which was they wanted a national. 00:03:28 Speaker 3: Business instead of a local one. 00:03:29 Speaker 4: They wanted one that was in a niche rather than like sort of a general purpose, and they wanted one that could have like real sustainability over a long period of time. So wooden boats was an unoccupied business space, so literally unmet need they found they matched the unmet need with an interest in that underlying interest in wooden boats and in cars. My dad was a wooden boat vintage boat gui and also a car guy, and so you know, this was just the fun combining the business knowledge with a passion. And again and I kind of all helped out when it was much smaller, and we kind of stumbled into the car insurance business, which was much much larger than the wooden boat business. 00:04:10 Speaker 2: Even the collector car businesses orders orders of magnitude larger billions. But let's not jump quite far that ahead. You and your dad used to work on cars rebuilding projects. You mentioned you had a couple of side hustles, lawnmowing things like that. 00:04:28 Speaker 3: Yeah, my apple orchard. 00:04:30 Speaker 2: You spent five hundred bucks buying a nineteen sixty seven portion nine to eleven s when you were thirteen. Yes, like I wouldn't be allowed to buy a car at thirteen. I was lucky I had a bike and then you and your father rebuild this. 00:04:46 Speaker 3: That's right. 00:04:47 Speaker 4: I will also know it was the only really good car deal I've ever done in my life. 00:04:50 Speaker 3: So just for what it's worth was. 00:04:53 Speaker 2: I'm going to assume that was the spark that started your enthusiasm. 00:04:58 Speaker 3: Yeah, it was. 00:05:00 Speaker 4: You know, my dad was a do it yourself for hobbyist restorer guy in the garage, and both my sisters also restored cars. They were older than I was with him, and then I was the third along and we convinced this older gentleman in our town to sell us this nine to eleven s for five hundred bucks. And I had to mow an awful lot more lawns and to sell a lot more apples out of my orchard to buy the parts to restore the car. 00:05:23 Speaker 3: But by the time I could drive it was ready and good planning. It was great planning. 00:05:28 Speaker 4: And I can tell you there was nobody in my high school driving a Porsche, so I would sneak it into the teacher's parking lot because no one would believe that a studentdone. But it's also like back then in the eighties, cars like that were not expensive. They were not considered to be necessarily that valuable. They were just kind of cool, older cars, and so we kind of approached it as a family, like, hey, these are you can get a lot of car for not a lot of money and you can have something really fun to enjoy. 00:05:56 Speaker 3: And so that was just my life growing up. 00:05:59 Speaker 2: I love that three hundred sl from the fifties were being sold at a depreciated price in the sixties and seventies. 00:06:06 Speaker 3: Oh, of course, astonishing well. 00:06:07 Speaker 4: The most valuable car today people will tell you it was a Ferrari gto nineteen sixty two. They're worth, you know, tens and tens of millions dollars, But in nineteen seventies you could buy them for fifteen grand. There were nothing, and now they're fifty million, sixty million dollars. 00:06:23 Speaker 2: Unbelievable that that nine to eleven s you restored, still have it. 00:06:27 Speaker 3: I still have it, still drive it. Of course. 00:06:29 Speaker 4: It's my first car out every season and the last one I put away. 00:06:32 Speaker 2: Wow, that's amazing. We could spend a lot of time talking about what else you drive, and. 00:06:38 Speaker 1: Like, we'll get to that later. I'm curious, when did you first. 00:06:42 Speaker 2: Realize Haggarty could become something a whole lot larger than a niche wooden boat insurer. 00:06:50 Speaker 4: But we had already started the boat or the car business in the early nineteen nineties. I had I've had a couple of aha moments, and this one I remember it like we were sitting here today and it was the fall in nineteen ninety five. I was doing my doctoral work in Boston and we were reading Plato's Republic in Greek. Okay, so I'm up in Boston College. We're working on Plato's republican Greek. That's a big slog, yeah, I can tell you. And I was trying to help out the family business kind of from a distance. And the challenge with insurance. It's insurance is an incredible industry. It's stable, there's a lot more interesting stuff to it than people think, but it is just not very sexy to talk about it. Nobody loves talking about insurance, and even with these big brands and stuff today, they still don't want to talk about it very much. And so I was literally sitting in this Plato's Republic class and on the side of my notebook I wrote this thing like, if we would just stop acting like an insurance business and start acting more like a club for car owners, it would just transformed the conversation that you're having with people, because then you're acting more like a car person instead of an insurance person trying to sell a car person something thing, and I literally wrote this idea of like turn Haggarty into a car club. 00:08:04 Speaker 3: I wrote it in my notebook and I closed my notebook. 00:08:07 Speaker 4: I went home that night to my apartment, and I dropped out of my PhD program right then, and I went home the next week. 00:08:13 Speaker 1: Well, let me validate that. 00:08:16 Speaker 2: Not that you need as a public company, need my validation, full disclosure. I have a few of my cars insured with Haggerty. I'm a member of the club. I get the Driver's Club magazine. But it's obvious in hindsight. Oh, of course you're going to focus on this niche that is kind of ignored, Yes, by the major insurance companies. How challenging was it to convince the rest of the fam, Hey, this is. 00:08:43 Speaker 1: The way to go. 00:08:45 Speaker 2: We're not an insurance company selling to car collectors, where car people satisfying a few of the box, checking a few of their boxes. 00:08:53 Speaker 3: It took me a few years. Yeah, you know, we were a very close family. 00:08:56 Speaker 4: It was really fun to work together with everybody in those early days. I retired after kind of that late nineties. My mom retired shortly thereafter. I was working with my sisters, so they kind of gave me the enough rope to go test it out that if we just changed the dialogue and acted just we're going to build an automotive branded business that happens to sell insurance, and we're going to do it around this membership concept. It wasn't like no one had ever done something like that. You know, if you think in the early days, Triple A was kind of like that, the Motor Club, that kind of you know, they've they're very different than that. Now if you were to even think of something like AARP, which is, you know, a different sort of segment, like there is a you know there in it. They sell a lot of insurance and they treat this group of people USAA serving military family people and families. It just nobody had ever done it in a business like ours, and so it took a little while to convince them that that was the way to go to market and we could change the way we were thinking. But you mentioned something that was another piece in this which was the next aha, next to hot was that most of these cars were insured by the big insurance companies. So thanks State, Farm, all State, you know today, Progressive, Geico, everybody, and you know, we're a little company, and we had a tiny family business, like, how the heck are you going to compete against these monsters? And so after we got the club kind of up and running, I realized, well, what if we just partnered with these companies rather than competing against them, and said, look, we're we're going to do one thing and one thing only. 00:10:28 Speaker 3: We're going to be expert in these cars. 00:10:30 Speaker 4: We know the customers really well, we're building a really big, rich bunch of data, and what if we partnered with them? And so the first big partnership like this we landed how twenty two twenty three years ago, and that was with all State, and all State's huge and huge company. I knew they ensured hundreds of thousands of these cars ago exactly lots of you know, lots of interesting things in that company, and I convinced. I met the CEO at the time, and just through kind of people help connect us, and I said, look, I think I can make you better at this one tiny little thing if you just give us a chance. And they're still a partner today, still grow that program grows every year. And now we've just moved through the entire insurance industry. We've partnered, you know, virtually with all of the big insurance companies. And so today if you go, you know, insure your home and your auto and everything with one of them. But you have a vintage car, collector car, whatever you want to call it, that usually comes to us. And so the big scalability of the business was one show up like a club like this member organization, to partner rather than to compete. And if you can partner, you know, because if you're if you're small, it's impossible to compete against a huge company. But if you partner with them, it changes the game. 00:11:45 Speaker 2: Well, when you say it's impossible to compete, one of the fascinating things about ensuring an old VET or an old Portie is, you know, any of the big farms are going to charge you fifteen hundred, twenty five hundred a year, you guys, for all right, So I have a sixty seven VET, which is actually my least favorite car to drive. 00:12:07 Speaker 3: I want to switch switch motor to ask. 00:12:10 Speaker 2: The three but with a stick Nasau blue over white, spectacular. But it's a pig to drive. But it doesn't matter because I think progressive. It was like twenty two hundred, you guys, were five hundred and change because of the data. You guys know how often these are driven, know the value. You know, they're really not going to get stolen. It's pretty as much as gone in sixty seconds made it look sexy. Everybody knows these cars they're VENs where they are especially something rare and valuable, which the vet is not. It's really fascinating that nobody else saw this until you guys did. 00:12:56 Speaker 1: How did the pricing model come along? 00:12:58 Speaker 4: Well, it's you know, and you talked about you drive your car, but you probably don't drive it very much. You probably have daily drivers that you know you drive more and you know, are less concerned about where you park it and that sort of thing. And you know, my late mother passed away just two years ago. I remember asking her, even I'd ask her every year. Her memory wasn't so great towards the end of her life, Like Mom, what made this business special? And she would just say, because people take good care of their toys, of course, And that is the core emotional nugget of this business. You know, people have a toy, they spent real money on it, and they take good care of it. And wherever there is care, there is better insurance risk. So you can charge less. You charge less, you know, you can build marketing around that. You can get a little bit of momentum, but not just a little less. It's not like all beating them by ten percent. It's a fraction of what you pay for regular insurance. Well right, And look, you're the typical sixty seven Corvette owner probably drives that car one thousand, maybe fifteen hundred miles a year, some years less some years. 00:13:57 Speaker 2: I have half the guys in my car group, and they're almost old guys, but not not exclusively. Some of these guys have ten twenty thirty cars exactly, So if they're driving a car, it's something different. 00:14:12 Speaker 1: Maybe they're putting five hundred miles a year on. 00:14:14 Speaker 3: Each car at most. 00:14:16 Speaker 4: So like one of the things you asked about pricing, So not only is the pricing on the physical car less expensive with us on the liability too. And it's exactly to that point. You can only drive one car at a time. Liability follows the person, not the car. And so we had a ad very early on in the program. 00:14:33 Speaker 3: We had it. 00:14:34 Speaker 4: There was a now late collector out in the Pacific Northwest with over two thousand cars, and we sat and we put a name his face on one of our ads, and he said, here's Harold LeMay, our worst nightmare because he has two thousand cars, but we charge him only one time for liability. 00:14:50 Speaker 1: So how do you is that a fleet insurance? 00:14:52 Speaker 3: How do you do something like that? 00:14:53 Speaker 2: Like if someone has more? And I think the line I heard about tattoos lies to cars. Two tattoos is either too few or too many, And if you have half a dozen or a dozen cars, it's probably too many to manage yourself, but too few to hire a full time jay Leno like guy to run it. 00:15:16 Speaker 4: Most people are space limited, right, If they have enough money to be into it, they end up buying everything that they can afford and still store. 00:15:23 Speaker 1: Right, So the store is the pastoragt. 00:15:25 Speaker 2: I'm waiting for permission to build a garage, a detached garage as opposed to my building garage, and that if that gets approved by the town, that's going to be both dangerous and expensive. 00:15:39 Speaker 3: Well I'm gonna love it though, because then. 00:15:42 Speaker 2: Because that's six more cars storage for you guys. Really really interesting. Coming up, we continue our conversation with Mkhil Haggerty CEO of the specialty insurance firm, talking about how he built the company into a one and a half billion dollar revenue driver. 00:16:01 Speaker 1: I'm Barry Ridults. You're listening to Masters in Business. 00:16:05 Speaker 2: On Bloomberg Radio. I'm Barry Ridults. You're listening to Masters in Business on Bloomberg Radio. My extra special guest this week is Mkhil Haggerty. He is the chairman and CEO of Haggarty Collector Car Insurance. The farm insures every collectible vehicle and a handful of boats for more than almost three million collectors. So twenty twenty five revenues of one point five billion, one point three billion in written premium, a record three hundred and seventy one thousand new members, net income plus ninety one percent. This is a real publicly traded company hgt Y. 00:16:47 Speaker 4: Yes, wow, that used to have hair when we started all of that, But I you know it, things are going well. 00:16:54 Speaker 2: So I guess if you're not pulling your hair out of your head, you're you're not public. Let's talk about how you've driven this. One of the interesting insights that seems to have shaped your strategy was that collective cars aren't just financial assets. Their emotional assets, you described them as favorite toys. How did that shape how the firm developed? 00:17:21 Speaker 3: Well? 00:17:21 Speaker 4: And we started in the simplest possible way, which we were an insurance agency. You know, you might have mentioned that even early in the first intro, and that's true. That's the easiest way to kind of get into one of these things. You know, as I mentioned, we started with kind of a specialty product, which was ensuring special cars. The product, you know, the insurance policy forms were unique or pricing. 00:17:41 Speaker 3: We had a unique approach. We had this driver's. 00:17:44 Speaker 4: Club model that you started really helping that compounding aspect of it. 00:17:49 Speaker 3: But one of the big. 00:17:50 Speaker 4: Pieces that I guess I dreamed of is that if we actually started taking real risk and became the insurance company itself, not just an agency selling policies for somebody yeltse, it would be the same customer coming in, but we'd have so much more of a chance to you know, really build a revenue behind it. 00:18:08 Speaker 3: So the other big piece. 00:18:10 Speaker 4: After, you know, if my first aha was driver's club, second AHA was you know, really realizing we needed a partnership rather than to compete with the big insurance companies. 00:18:18 Speaker 3: It was how do we start taking risk? 00:18:21 Speaker 4: So that that's been a multi multi year, really decade long journey that we started in twenty seventeen, got that up and running, and it was really a big key piece of how we went public in twenty twenty one, and that is that we were going to you know, we had everybody knew we had a unique angle on this market, that our economics looked great in the business, but that we could realize even that much more. And so that's really been the next big piece of all of this, and it all kind of compounds on itself because if you in Sure Car, you we use the club to kind of engage people. You know, you mentioned reading the Hager Driver's Club magazine. I mean that is that is by the way, I don't think the word insurance is mentioned in that magazine. 00:19:04 Speaker 3: It's a car magazine and. 00:19:06 Speaker 1: The Cars and Roads. 00:19:07 Speaker 4: Really yes, and it is the now highest circulation car magazine in the world. 00:19:12 Speaker 2: No, kid, I did not know that. That's really that's really interesting. So the evolution from insurance to an automotive lifestyle brand goes beyond the club membership, goes beyond the magazine, events, auctions, valuation data. 00:19:31 Speaker 1: Walk us through how that all evolved. 00:19:33 Speaker 3: Yeah, I think, and I was. 00:19:35 Speaker 4: I was a big fan of car magazines as a big fan of automotive media. I mean that's how I read my way into understanding the car world and going to events. So and I always remember somebody told me once that if you're gonna, if you're gonna go into a niche business that you're really proud of, you kind of need to have. You need to have the high ground on your side. And for me, the high ground was if I could have a media property that where we would you know, kind of have that intellectual high that would help. 00:20:01 Speaker 3: The other piece is the data aspect of it. 00:20:04 Speaker 4: When I was, you know, growing the business and the team, you know, we have incredible teams. We're out there trying to figure it out. Valuing these cars was so tricky because there was a lot of opinions about what cars were worth, but not a lot of really good data. And so, you know, as we were investing in the media pieces talking about cars and entertaining people, we built the data resources. We call it our Automotive Intelligence Group. We have by far the richest sets of data about how to value these things. And it's down to that VIN or serial number you know, you mentioned how does a big insurance. 00:20:37 Speaker 3: Company, you know, why didn't they do it? 00:20:39 Speaker 4: And I remember this conversation years ago in one of those partner discussions where I mentioned the CEO as a car guy, really wanted to kind of compete with us, wasn't sure if you wanted to partner with us, And I said, well, do you know what a nineteen sixty nine Camaro is? And he said, I sure, do you know he's kind of pretty happy with himself. 00:20:56 Speaker 3: And I said, you may not know that. 00:20:59 Speaker 4: In nineteen sixteen and the Camaro came in one hundred and forty seven different variants, and that year the least expensive one was worth about eleven grand and the most valuable one was worth about one point one million. And you can't tell the difference by looking at them from the outside. You have to understand what that serial number is. And I said, we built a patented serial number decoder for all cars pre nineteen eighty one so that we could understand our universe and start providing that data. And that's why our partners like us. But it's real asset to have that kind of data to and then build on it every year. You know, you mentioned three hundred and seventy one thousand new customers. We'll do quite a bit more than that in twenty twenty six. That those are all just it's not just insurance or revenue, it's also data coming our way. 00:21:40 Speaker 3: What are people buying, what are they insuring them for? What do they sell? 00:21:44 Speaker 4: You know, when somebody sells a car, it's also a data point, and so for us that that kind of data piece. And again it's all a big not just because I'm a car person. I view it as a flywheel. It's a flywheel and it all kind of spins, and insurance is a beautiful thing, but the rest of it speeds up the flywheel. 00:22:01 Speaker 2: Yeah, to say the very least. So the valuation tools you have are really interesting. The bull market list you have has become very influential. I actually reference some of your valuation tools in a chapter on my book on selection bias. 00:22:20 Speaker 3: Every time some. 00:22:21 Speaker 2: Car goes for a new record high, there's always a bunch of media coverage and they talk about, look at what a great investment this is, and it's like, no, that's all survivorship. 00:22:30 Speaker 1: I show me the other ten. Don't show me what was. 00:22:33 Speaker 2: The best car of the past fifty years. What car are you going to buy now to put away for the next fifty years. That's a much harder question. You don't know the answer, but your valuation tools have been really helpful that sort of stuff. 00:22:46 Speaker 1: How did you build that capabilities? 00:22:48 Speaker 2: It simply just hey, every data point we come across from clients, we're going to suck into a database and figure. 00:22:56 Speaker 3: Out that was exactly it. 00:22:57 Speaker 4: I mean, if most media outlets that weren't part of our world, if they were covering the space, they were using a lot of anecdotal information kind of dealer fed information, or just looking at public auctions. And I love public auctions too, Like you can learn a lot from watching what all the different auction companies do. And now with so many good online places, it's like even more data. But what we realized with our scale is like we just had way more data points than all of that because again, people buying cars and sharing them with us, adding to leting, it was just this big flow. And yeah, it took a lot of people a lot smarter than than I am, to build all the you know, the not just the database stuff, but the analytics capability around it. 00:23:40 Speaker 3: And now with AI it's even better. 00:23:42 Speaker 4: And then as we started realizing we could get other data sources that help us validate even more, not just in the US, but outside of the US. It's really been a fun part of the business. It's I'll tell you what there's it's a smart team and I love learning from them. 00:23:58 Speaker 3: They teach me stuff every day that I need to know. 00:24:00 Speaker 2: So you mentioned auctions and online auctions in addition to Bring a Trailer and cars and Bids and Peak Car, you guys are now going to get into online auctions for your client's cars or you just partner. 00:24:16 Speaker 4: With Oh no, no, we have a Hagardy marketplace platform which is uh online auctions. 00:24:23 Speaker 2: And then you've had online classifying classify time. How How rapidly is the auction side growing. 00:24:29 Speaker 3: It's growing rapidly. 00:24:31 Speaker 4: I mean, we just we have such a supply that you we have a lot. We have way more supply than than you think. And if you think about some of those other great companies like Bring a Trailer's been such a darling in this space. Cars and Bids the number two in the US. But there's a supply and demand balance that everybody has to strike because if you flood a digital marketplace with too much supply, then the bidders go away, and so you and if the bidders go away, then nobody's happy. The bidders won't put their cars on it. So it's this it's a fast build, but it's steady. That the live auction side of the business brought Arrow, which was an acquisition we did after going public. That's a remarkable business because I had followed that industry for a long time around the world. But it's all about getting the right team, and in my mind, because I'm very protective of our brand and our reputation, we had to have the kind of team that wasn't prepared to build the number one live auction business, but they have to do it in a way that I'm proud of because and I'm not saying that, you know, it's all good or bad, but I wanted to be I wanted to be very proud of the outcome because things will go wrong. You have to make things right for customers. Sometimes cars that people bring to you to sell aren't described exactly as they actually are, and you have to find that out and politely tell them, well, I'm not sure this is a million dollar car it's one hundred thousand dollars car, and you know, sorry, if you wanted us to sell for one hundred thousand, we will, but we're not selling it for a million because it's our reputation too. And so again, the way I think about it now is most people come to us to ensure a car, then they buy the membership thing, and we engage them and do media and a lot of fun stuff, invite them to our events, and about every seven years on average, somebody buys or sells a car, and that's where I want to be there and present in their minds so that we help them on that transactional side. 00:26:24 Speaker 3: And plus you've. 00:26:25 Speaker 4: Probably been to auctions or watched them on television. Is they're fun, Like car auctions are super fun. You know, it's live, it's viber, and it's interesting. Sometimes there's multimillion dollar cars up there selling that you can't even believe anybody would pay multimillion dollars for this car, And we do that too. I mean, that's why we have brought Arrow and we connect it with some of our concore events. 00:26:45 Speaker 3: In many cases they're around the world. We just had our. 00:26:49 Speaker 4: Broad Arrow auction at the Concourse so at Villadeste, the Villadesta Concourse, So Delagonza, and that was a really successful sale and super cool place to have an auction right on Lake Como in Italy, and Italy looks beautiful. 00:27:02 Speaker 2: You've been a judge at Pebble Beach for a while. 00:27:07 Speaker 3: I know this five years. I think this is my twenty five wow. 00:27:10 Speaker 2: And I know there was an affiliation with one of the local concourses here. 00:27:13 Speaker 3: Maybe it's Grantwich Greenwich Cheah. That is an event we own, so we produced that just recently. 00:27:18 Speaker 2: So yeah, that's ah, it's too close to a holiday weekend. 00:27:22 Speaker 3: Otherwise I would be there. Oh you gotta come. 00:27:25 Speaker 2: It's I'm usually out at the beach on Memorial Day. We agon but but we'll circle back to that. I'm also a big fan of your YouTube channel. I really like Jason Camiz's work. I've learned a lot about cars that I think I know and then he does a deep dive into a particular model and I'm like, I didn't know that about the Toyota Supra. 00:27:48 Speaker 1: Who would have Who would have guessed? 00:27:51 Speaker 2: How did YouTube become such a major part of your brand? 00:27:55 Speaker 4: Well, it's it's one of the well it's really the de facto platform for people watching kind of introductory level automotive content. And obviously lots of brands are putting stuff out there. But what we realized is if you think about the big sort of arc of how people have learned about or consumed automotive media, where it's shifted since the nineties was magazines were you know, the main platform for a long time. Then when you got you know, the first dedicated cable network, which was Autoweek speed Vision, you got some of those you started seeing auctions on there. But then a lot of that content started migrating to YouTube. But what I wanted to do was do it like as the same high quality like we were doing in the magazine, so higher total pros shoot the stuff really well, you know, great cameras, great locations, all of that stuff. 00:28:48 Speaker 2: It is obvious high production value. Like there are a lot of YouTube channels that are kind of interesting cars or otherwise, but the appeal has always been two iPhones and a wireless mic and a go bro tobbles Go Bro Right. I've seen a bunch of channels that they're they're using these not necessarily the go pros. 00:29:15 Speaker 1: Uh, you guys, really. 00:29:16 Speaker 2: Put a lot of thought and a lot of time, effort and money into them. 00:29:19 Speaker 3: Well, we do. 00:29:19 Speaker 4: And they're not all just drag races. Nothing wrong with drag races. I like them too. It kind of is a it's a kind of data point about what makes a car cool. But I think Jason just takes it to a whole new level. For example, we also have a you know, one of our one of our shows, and by the way, we also have you know, we have a fast channel on Samsung TV, on on Amazon Prime. You know, our content is available out there like a digital television show. Our Barnfine Hunter show for years, you've probably seen it, which is, you know, this incredible talent in Tom Cotter going around and finding great cars in barns and kind of doing the big reveal like an antiques road show kind of concept, but in the garage rather than brought to some studios. 00:29:59 Speaker 3: Some and people like it. 00:30:01 Speaker 4: There's like some interesting fascination with the US television audience of finding the treasure in the garage and don't you wish it was you who found it? 00:30:11 Speaker 3: And I find them fascinating. 00:30:13 Speaker 4: We even you may have seen one of the shows we produced for a long time they're kind of winding down. But it was called Redline Rebuild, and it was where we would do these time laps rebuilding of an engine, where you know, you take a big, dirty engine apart and it would all kind of like appear to assemble itself on an engine stand and then it would start and just it was mesmerizing. 00:30:34 Speaker 1: That's the word I was about. 00:30:36 Speaker 2: Yeah, there's another channel that does the same thing with old watches, oh and rebuilds them. And it's the same sort of why this is so fascinating, Yes, as Redline, it's the exact same same thing. Coming up, we continue our conversation with Nikhil Haggerty, CEO and chairman of Haggarty's Specialty Insurance, discussing the electric car community. 00:31:01 Speaker 1: Today. I'm Barry Ridults. 00:31:03 Speaker 2: You're listening to Master's Business. 00:31:05 Speaker 1: On Bloomberg Radio. I'm Barry Ridults. 00:31:08 Speaker 2: You're listening to Masters in Business on Bloomberg Radio. My extra special guest today is Mikhail Hagerty. He is the CEO and chairman of the namesake specialty insurance company specializing in collectible cars automotive everything from cars, truck's, military vehicles, including classic wooden boats are those old Chriscraft or are there some other brands that make the way. 00:31:35 Speaker 4: Chris Craft and Century were the two big manufacturers in the United States. There were sort of some more boutique brands like Garwood and Hackercraft, which were really high end craft. 00:31:47 Speaker 3: I've Hackercraft. Those are big, tend to be a little bigger, right, a little bit. 00:31:50 Speaker 4: Bigger, triple cockpit kind of style boats for those who are really into the artisanal cheese of the of the boat world. 00:31:58 Speaker 3: I love the Canadian brand so well. 00:32:02 Speaker 4: There was a whole group of really fine boat builders up there, Manette, Shield, Barnes, Gravett, brands that most Americans would not know of. But if you ever get a chance to go up to like the Muskoka Lakes, which is just north of Toronto, it's they're just exquisite, like beautifully built boats. They're like considered national treasures up there, so you don't see many of them in the US. 00:32:26 Speaker 3: But that's that's just spent. That was part of my upbringing. 00:32:28 Speaker 4: Like when when we were my mom and dad were building the boat business and I was a teenager of a Psychi We're going to going a boat show, going to Canada, going to Lake Tahoe going to the finger Lakes. 00:32:37 Speaker 3: That's so interesting. 00:32:38 Speaker 2: I took some friends to the boat show last year and the new chrisscrafts are shockingly beautiful, like they have aged into modernity really well. Like it's almost like a retro modes because it's very contemporary and very modern, but clearly design language from way back when. Yeah. 00:33:02 Speaker 4: There, I think it's a little bit like that Hinckley crowd where they're trying to find a retro modern boat but with kind of retro looks and. 00:33:10 Speaker 3: So love it. 00:33:11 Speaker 2: So let's let's let's keep this on cars away from boats. And there's a quote of yours that I have to start with because it's I really like it. The best piece of advice is to buy the car you want to drive, and then buy the best example you can afford. This may sound obvious, but not all vintage cars drive the way people hope they would. So there's nothing in that I disagree with discuss. 00:33:41 Speaker 4: Yeah, I think there's so many people that they they envision someday when they have that little bit of extra resources. You know, that's going to be my toy. I want to get into the car world. And if they weren't one hundred percent in this their whole life, or they you know, their parents weren't into it, or you didn't have an uncle or somebody in your life who elects you drive in these things. I often recommend people try to get a chance to drive what you think you want, because the older cars do drive very differently. Yes, and even if you think of say muscle cars from the sixties, they were very fast. I mean, these are cars that are in a straight line and a straight line a lot of power. They do not stop or turn as well as you think, and you just have to get used to that. I mean, I love cars of all generations. I love driving very early cars. I have some newer cars, and I always just have to kind of center myself when I get behind the wheel, to remember, like, okay, this is this is not a this is not my Porscha techon, which is you know, like this incredible piece of technology, you know, electric car. It's a vintage internal combustion car with funky brakes, and you have to be ready for it. So I always recommend people drive them and recognize that maybe it had air conditioning, maybe the air conditioning doesn't work, it doesn't matter like roll down the window and to enjoy yourself. 00:35:01 Speaker 3: Manually, manually. 00:35:02 Speaker 1: And I tell the story the vet the sixty seven. It's a lap break. Lap belts is not a three point belt. 00:35:10 Speaker 2: They couldn't be bothered to put a passenger side mirror on, no, because you know, what do you what are you need to see? 00:35:16 Speaker 1: And the steering is just beastly. 00:35:19 Speaker 2: But I also like the concept of buy the best example you can afford. And I find myself constantly saying to people a cheap asst In Martin is the most expensive car you could possibly buy. 00:35:33 Speaker 1: But people don't really really get that. 00:35:35 Speaker 4: Yeah, and they're you know, look different, different eras of cars come with their own challenges sometimes, you know, I think as as we're seeing this onslaught of new generations coming in and wanting to buy slightly newer cars. I mean, it's sixty whatever percent of all of our you know, new quotes and new cars coming into the space are all like relatively newer cars. Car know, nineteen eighties, nineties, two thousands cars. Some of those cars, for example, it may not be a mechanical issue that can drive you a little crazy, it's an electrical issue that will drive you a little crazy if you think of, you know, some of the screens and the CD players and all the little control things that back in nineteen ninety whatever was you know, the biggest whizbang feature. Well, it doesn't work so well anymore. The car runs fine, but you know you're not going to be able to use the antiquated NAV system. I just tell people like, it'll relax, it's fine, and you know, enjoy the car. 00:36:30 Speaker 3: Drive it. You know, all my kids I always asked, like, well does the radio work in this thing. 00:36:34 Speaker 4: I'm like, I have no idea, it's never been on. I'm there to drive, and it's such a fun activity. As you know, they've gone, just enjoy it, enjoy driving a car for pleasure. And I also tell one, you know, the first thing I tell people who's sort of new to the space, like, well, I want to take it out to dinner, And I'm like, make sure you take it out during the day first a few times, because sometimes cars leave you in the restaurant parking lot at night. So people, if you drive them, and I'm like, because I'm not sure I'm going to get home. 00:37:06 Speaker 2: If you're if you're used to modern cars, you will be shocked at how terrible the headlights are on Forget sixties eighties era's car. 00:37:16 Speaker 1: Those were not really great headlights. 00:37:19 Speaker 3: They weren't great. They're not dangerous or anything. You just have to be aware that they don't have all the modern technology. 00:37:24 Speaker 2: Well, when all the headlights were that way, you just said, this is what the lighting is and you had to be aware of it. 00:37:30 Speaker 3: That's right. 00:37:31 Speaker 2: It's when you go backwards, you take a lot of things. For forget the blind side warnings and the backup cameras. Just your expectation of field of vision is so different. So so let's. 00:37:44 Speaker 3: It's a different kind of attention driving. 00:37:46 Speaker 1: A yeah car, it's much more focused. 00:37:48 Speaker 4: It's more focused, and I love it, and you know, I encourage people, you know, just try it out. 00:37:53 Speaker 3: It's a it's a great experience. 00:37:55 Speaker 2: So, so, what are some of the bigger trends you're seeing in collecting what what's changing these days? 00:38:02 Speaker 4: Well, again, big big story, you know, contrary to know data that we were reading a few years ago, is the next generations are absolutely into cars. 00:38:09 Speaker 3: They like them. 00:38:10 Speaker 4: They're just into different kind of cars than our parents were. 00:38:13 Speaker 3: We were. 00:38:13 Speaker 2: Probably, Well, doesn't every generation sort of lust after the cars from the high school parking lot. 00:38:19 Speaker 3: I think that's right, they did, and they're different. 00:38:21 Speaker 4: And I'm one of my little cottage industry things that I do is if I remember driving anywhere near a high school parking lot, I look to see where the young car people park their cars, and they usually park them in the back of the parking lot and not up near the school, and they all park next to each other. So then go hang out afterwards. And what you're going to see right now of a butt with the seventeen and eighteen year old's car people in these high schools is you know, you're going to see BMW's, You're going to see Audi's, You're going to see some you know, various performance Japanese cars. You know, you're not going to see anything fancy. They can't afford them, but that's the cars they're starting with. Trucks are, of course another big entry point and it's another another huge trend, so not just pickup trucks, but kind of vintage SUVs. 00:39:05 Speaker 3: So jeeps are still right now one of the hottest brands. It's huge. 00:39:09 Speaker 4: Of course, Broncos are one of the hottest things. Of course, if they can afford them. You know, depending on it, a land Rover or International Scouts. These are the cars that people are interested in because so many cars today are SUVs anyway, and so the vintage version of them are one of these kind of more off road vehicles, and there's a big industry of modifying them, making them work a little bit better. 00:39:31 Speaker 3: And so that's another big trend. 00:39:33 Speaker 4: So again, next generation trucks, I guess I would say, I mean flying over the top of the whole industry, which you know, at the top top end of the market. And just to add on to the answer to your question is, you know, the ultra luxury kind of supercar manufacturers are making more cars than ever ever before, and so you think of those brands like Ferrari or Lamborghini or Bentley or you know even portion beloved nine to eleven ass those companies are just building a lot more cars and pumping them out into the market at price points that were different than they used to. So you know when Ferrari or Lamborghini were building hundreds of cars a year, well now Ferrari's a fourteen thousand unity year manufacturer. Lamborghini when you add their suv in, it's an eight or nine thousand vehicle manufacturer. I mean, when I was a kid, you never saw Lamborghini unless you just happen to be in Beverly Hills or Palm Beach or something. And now they're everywhere. I mean even in my little town in northern Michigan, they're a couple Lamborghinis driving around. I'm like, oh, my goodness, you know, that's amazing. 00:40:34 Speaker 1: And so what's crazy is where I live. 00:40:37 Speaker 2: I'm fifteen minutes from a Ferrari dealer, two Porsche dealers, the Bentley Lambeau dealer, and I take it for granted I see these cars all the time. But as a kid, you hardly ever saw these around. You wouldn't have like a Porsche was an exciting thing. 00:40:54 Speaker 3: It was. 00:40:55 Speaker 4: So they are building my next generation of customers. Every one of these manu facturers are like my best friends because they're they're building the cars that I will be ensuring this year and twenty five years from now. 00:41:07 Speaker 2: So so your boy Jason Kamisa mentioned he's only a manual driver. I embrace that makes the car even that much more difficult to steal. But I'm curious amongst the trends in collecting, I've been hearing about a move towards analog, towards manual, away from the big dominant screens. 00:41:31 Speaker 3: What does your data say, Well, it's true. 00:41:34 Speaker 4: And in fact, you know, you think about some of those very same supercar manufacturers that you know, we're you know, they signaled years ago we're getting rid of manuals. You know, everything's going to become this super electronic sort of driving experience, faster on a tracks track. 00:41:49 Speaker 3: Yeah, I mean, I think, yeah that and they are. 00:41:51 Speaker 4: And by the way, the one nice thing about the PDK if you drive them in the winter, like I happen to love driving Porsches in the winter, PDK is pretty nice in the snow for what it's But setting that aside is I'm just totally impressed that many of these car companies are kind of going back on what they said they were going to be doing and starting to not reintroduce manuals, but they're producing another extra model with the manual. 00:42:15 Speaker 1: In at a very high price. 00:42:17 Speaker 2: The Porschie Sts or the Sport or all the GT threes if you want a manual. My GTS was the last year it came with a manual, which was twenty four and the turbo. 00:42:33 Speaker 1: I think twenty thirteen was the last year with a manual something like that. 00:42:37 Speaker 2: So it's amazing they took the supply away and said, all right. 00:42:41 Speaker 1: If you want a manual, give it to you. 00:42:44 Speaker 3: But it's three hundred thousand dollars. Yes. 00:42:46 Speaker 4: And what they saw is they were looking at the auction data, like from our auction companies and others, and suddenly the manual version of something huge, absolute premium. 00:42:56 Speaker 2: And now manual swaps are showing up in in V twelve Aston Martin's and four thirty Ferraris. 00:43:06 Speaker 1: I see these all the. 00:43:07 Speaker 4: Time absolutely, So again it's I think it's the return of the analog people more, you know, interested in driving. I mean, I think I think we're all trying to absorb what COVID did. 00:43:18 Speaker 3: COVID was a boom. 00:43:20 Speaker 4: I'm sure time for these kind of cars, but you know, even afterwards, I think, you know, people were embracing slower hobbies, slower things, you know, playing music, camping, hiking, you know, outdoor pursuits, and you know in some of these things kind of cars sort of fit into that a little bit, which is, you know, something to just go out and take a long, slow Sunday afternoon drive is not something that you know, the rush rush world of what mileage does it get? And you know, what's the least payment on it? You know, it's it's just a it comes from a different place and there's a bigger audience than people think who are willing to spend real money on it. 00:43:59 Speaker 2: So there's a data point you guys have reference. I want to ask you about. 00:44:04 Speaker 1: Quote. 00:44:04 Speaker 2: We estimate that approximately twelve million enthusiast vehicles will transfer to a new generation in the United States over the next fifteen years, either via estate plans or inheritances. What is this generational handoff from I guess we could call them boomer collectors to millennials and gen z. What does this mean for the car collecting community. 00:44:31 Speaker 4: Well, and I think we've all read that there's this huge, you know, gigantic wealth transfer. Whatever the headline number is. I've heard five trillion, I've heard one hundred trillion, you know, seventy and you know, ar estimate just on that number of you know, thirteen you know million vehicles, twelve thirteen million vehicles, it's about five hundred and seventy billion dollars worth of car value. Right now, most of those are held in, you know, the hands of the generation of baby boomers. 00:44:58 Speaker 3: I'm an I'm an older gen. 00:45:01 Speaker 4: You know, Gen xers are starting to come into the peak wealth, past peak earnings, in the peak wealth years, buying a lot of cars. But fifteen years from now, about a third of that whole market will will come loose back. And we're again, we're seeing this. Certainly, the entry points are different than they were a generation ago, where people are interested in sporty cars, trucks, younger kind of you know, young timer cars as they refer to them in Europe, and you know, we are, we're seeing the data. We want to position ourselves well to see that the transfers are kind of smooth, you know where you're you know, you're kind of helping the next generation get into these cars. We're actually doing things like teaching manual driving classes because you know, if you talk about it, it's not just an anti theft device or some slow hobby like brewing beer or whatever. 00:45:51 Speaker 3: It is. 00:45:52 Speaker 4: It's we need to teach the next generation how to drive manuals. And it's it's you know, it's not that hard to do. 00:45:58 Speaker 2: Not only is it not that hard it's just so much more engaging. And not to be a stick snob, but it really is a very different experience. 00:46:10 Speaker 3: And yeah, I know the GT. 00:46:11 Speaker 2: Three in the PDK is faster than the stick, but how often am I taking my car on the track. If that's once or twice a year, it's a lot. What about the other three hundred and sixty days a year. 00:46:25 Speaker 4: Well, even if you did, you and I neither of us are good enough drivers to really make a difference. 00:46:32 Speaker 2: Okay, one second different, whatever it is, it's it's it's funny because I've done all the high performance driving classes and the reality is, if you're in a raush Mustang up at Lime Rock, they said put into third, leave it there for the whole track. So really driving the stick isn't that much different. But if you're really doing the competitive course, of course not. First of all, you don't the car doesn't stop, the dual clutch is so fast, the engine is always engaged, so you're not losing that tenth of a second when the clutch is down and you're losing power. But it still just feels so much more engaging. Related question to the analog and the manual, So you do a twenty twenty five Bull Market List. You do one every year. The average model year of featured cars used to be in the late eighties, early nineties. All of a sudden, it's two thousand and one. How did that happen? What's driving that shift in Bullmarket attractive? 00:47:42 Speaker 1: Is it that pre. 00:47:46 Speaker 2: Screen, analogue manual feel but not quite as old as the seventies eighties cars. 00:47:52 Speaker 4: I think so, and I think it's but it's also it's a combination of what's driving demand. One is there's absolutely a new cohort of people getting in making a little bit of money buying these things at the top end of the market. Though it's not just oh, the new young tech guy who has who's going to be in the open ai IPO and is going to make money and go buy a car. Older generation collectors are also buying a lot of these new cars at auction. 00:48:19 Speaker 3: And it's interesting. I've seen this twice in my career. 00:48:22 Speaker 4: In the big muscle car era, which was two thousand and five sixty seven, right before the Great Financial Crisis, everybody said, oh, it's a new generation of people buying all these muscle cars and paying American muscle cars and paying a lot of money for it, and that was true, there were, but it was also the older generation of collectors who liked earlier cars saying like, well, maybe those are cool and I want one too, and by the way, I have more money than you, so I'm going to outbid you at auction and it's mine. Same thing right now in this sort of like say supercar segment, where a lot of these cars from the nineties and two thousands are we see these values going up. 00:48:57 Speaker 3: It is the new kind. 00:48:59 Speaker 4: Of newer money, newer collector, but it's an older generation of collectors saying well, I don't want to be left without a cool car. Or In fact, one guy told me recently who bought a Bugatti Veyron and a couple of newer cars, said well, I want to have a car that my grandkids thinks is cool. And so I'm like, got it, And that's not the Bugatti Veyron he loves, he said, And I'm taking my kid my grandkids and drives in the Bugatti Veyron, and so you know they think it's cool. 00:49:25 Speaker 1: Yeah, I can, I can imagine. 00:49:27 Speaker 2: All right, last question before I get to my favorites, because I know, ye we're watching the time, so you guys crunch so much number, so many data is what do you think the casual observer of collector cars misses that your data is revealing. 00:49:44 Speaker 4: Yeah, well, I think those big headline cars are they attract so much attention and people just think it's this, you know, crazy, very high end market, very very rarefied cars. And while that is true, those are the headline grabbing numbers, you know, the big story is that there's just a much much wider opportunity for people who want to play in this space. Every single price point, every little bit of reliability and everything from pickup trucks. Like I said, if you live in that part of the world and that's something that's interesting to you, it's a very broad based hobby. 00:50:21 Speaker 3: It's also you know this is. 00:50:23 Speaker 4: This was a hobby that for many many years was very much male oriented, mail driven, and I can see that in the data of who our insurance are and everything else. There's a really rising cohort of young women and you know, women who want to have these cars and have it be part of their lives too. I think that's probably one of the most exciting trends that so very broad based. 00:50:43 Speaker 2: I've noticed a lot more women YouTubers talking about cars. 00:50:47 Speaker 4: And coming to cars and coffee with their cars and and that sort of thing. So it's there's just there's a lot more to it. It's much broader based. And sure it's fun to see a multimillion dollar whatever sell someplace, but that's just not that's not the average reality. The average is actually much broader based and much more interesting. 00:51:04 Speaker 2: So I want to get to our favorite questions, but I got to throw some other stuff. 00:51:10 Speaker 1: Let's just do a quick speed round. 00:51:12 Speaker 2: Someone comes up to you and says, hey, I'm interested in a fun weekend car. I don't have a lot of money, but i'd like a convertible stick shift. 00:51:20 Speaker 3: What do you use? Mustang? 00:51:21 Speaker 1: Mustang? 00:51:22 Speaker 3: Of course? 00:51:22 Speaker 2: Yeah, other than you say of course, because I would have said Miyada. 00:51:25 Speaker 4: Oh yeah, well Mustang or Miyada. I mean so, And I always tell people like the oldest Miyada is now thirty three years old. 00:51:33 Speaker 3: Something like that. 00:51:34 Speaker 4: Milled they made and they made over a million of them for the US market. 00:51:38 Speaker 3: Super reliable. 00:51:40 Speaker 4: If you want to go track driving, they're the great track cars. If you want to just cruise around a weekend, they're inexpensive. Ten to fifteen thousand dollars. But same thing with Mustang, you know, so just they're. 00:51:50 Speaker 1: A little more horsepower in the Mustang, a. 00:51:51 Speaker 3: Little bit more horsepower. 00:51:52 Speaker 4: They made a lot of they made a lot of convertibles, their manuals, they're automatics if you don't feel comfortable with that, and very very affordable car and easy to get serviced, so that those would be my two recommendations. 00:52:04 Speaker 3: Of course. 00:52:04 Speaker 4: The most collected car, though still in the United States, is a Corvette, and you know, they've been making them forever. There are lots of them, easy to service, and. 00:52:13 Speaker 2: Not that especially like a C six or C seven, not that expensive for a semi modern car. 00:52:20 Speaker 3: They're amazing. They're amazing cars. 00:52:22 Speaker 2: Someone says, I'm interested in something European, a little more interesting, sporty. 00:52:28 Speaker 1: Way do you send them? 00:52:29 Speaker 4: Well, I'm a poors person, so I would say, great, you want a nine to eleven, But let's start you in a box star, you know, let's start you in you know whatever, some more entry point point there. That younger generation that I talked about, the sort of three series BMW's super fun cars, lots of them built with a lot of quality to kind of have style they look good. 00:52:52 Speaker 3: That's where people go. 00:52:54 Speaker 1: Yeah, those of aged beautifully. 00:52:55 Speaker 2: Yes, the design of the early BMW's someone who's a little more has a little more scratch, a little older, says hey, I'm looking for something fun, but it's going to retain its value. When I'm willing to spend more than my kid buying a boxter. 00:53:12 Speaker 4: Well then it's still probably I mean, again my my bias here, I'd still probably say nine to eleven. But you're going to pick a year that was maybe slightly slightly off year, they're going to hold their value. Well, I've actually I did a kind of market cap comparison between every nine to eleven every built ever built versus every Ferrari ever built. Because people talk about Ferrari GTOs and all this sort of thing, which are worth tens of millions from I'm. 00:53:36 Speaker 2: Seventy five, and they're just spent. They were spectacular and they are I love them. 00:53:41 Speaker 4: But when you look at all the nine elevens that were built that were really undervalued for a long time, you know you could buy I mean people used to give me a hard time because my sixty seven nine to eleven s when I spent over one hundred thousand dollars having a professionally restored not that many years ago. Oh, I mean after my you know, my very amateurish high school restoration. I spent one hundred thousand or whatever, a little bit more than that, and it was worth about seventy right, Well now it's worth about three hundred, no kids, you know, two fifty three hundred for a sixty seven s And people say, like, what's the car? What's your nine to eleven worth? I'm like, I don't care. It's my baby, and like, no one will ever. I and my family will have that car forever. 00:54:22 Speaker 2: I have a bias against garage queens, but I'm curious as to your thoughts. People who buy cars put them in a garage never drive. 00:54:30 Speaker 3: I think those are really sad cars, right. 00:54:32 Speaker 1: They got to be great for business because to zero risk. 00:54:35 Speaker 4: The claims are low, but if they're sad cars, and especially by the way, no almost there's not a single generation of cars that fares well when it sits around for a long period of time. Tires age, belts and hoses age, and some of those nineties and two thousands cars they age particularly badly when they sit in the garage lots. Of maintenance required. So my view is if you got a car unless it's like six miles on it or fifty miles and you just think that's what makes it cool. When there were a lot of customers that we have that like that, my view is, go drive it. We sold at our Amelia sale one of the two record setting for ferrari Enzos. We sold it for fifteen million dollars. The car had I think two hundred and forty nine miles on it ferrari Enzo, and everybody's like, what do you think of that? I'm like, I would rather have the twenty thousand mile ferrari Enzo that I could go drive. I mean that just personally myself and I congratulated the buyer. Wonderful buy sir, but I would like to please drive it, Please drive it. 00:55:32 Speaker 2: Doug DeMuro said something really interesting about his career GT when he was hunting for one, he found one with higher mileage because he said, I won't go through the process of I'm not going to drive this because. 00:55:44 Speaker 1: I'm appreciating it. 00:55:45 Speaker 2: It's starting out higher mileage, so you're more inclined, you're more inclined to put miles on it. 00:55:50 Speaker 4: I have one vintage car that has super low miles on it. It's a Jaguar E Type nineteen sixty six. It had thirteen thousand miles on it when I bought it, and it has about fifteen thousand miles on it now. And it's just it bugs me because I feel like it should be driven, and then I worry that I'm just putting a bunch of miles on it, and so I don't know. 00:56:08 Speaker 3: I have the same quandary. So I just like the drive cars. 00:56:11 Speaker 2: So we're recording this right after Ferrari dropped their new loose electric appliance. 00:56:19 Speaker 3: I don't even want to chuck it. 00:56:20 Speaker 2: Yeah, yeah, it's my Ferrari buddies are not big fans of all the new versions that have been coming out. I still think the four fifty eight is really handsome. I love the eight twelve GTS. If I ever get that garage built those, one of those has my name on it. But the question for you is, when you see these new cars coming out and they're so technology heavy and so screen focused, how do you think these will fare as collectibles twenty four sixty years from now? 00:57:01 Speaker 4: Well, I can tell you I will never bet against Ferrari, not ever once, because I mean it is just forever since the day the first one was built, until you know, it's just there's been something magical about that brand. 00:57:14 Speaker 3: I love the. 00:57:14 Speaker 4: History of how the fact that like the second Enzo Ferrari back in the day would show up with one, like everybody knew, well, that's the car to beat, period and even though sometimes you beat them, sometimes you didn't, they were just the car to beat. And I also remind people that cars, like companies like Ferrari, they've always had different lines of cars. You know, Ferrari always at race cars, but they also always had their like businessman's car, you know, a front engine, slightly less preform exactly exactly well. And the suv the pro songway like people said they'll never build an suv, and I remember I was talking to Bob Lutz and he just said watch he said, And I'm like, why do you think they will build an suv? 00:57:56 Speaker 2: Bob? 00:57:56 Speaker 3: And he said, because they have to. 00:57:58 Speaker 2: I was gonna say, s the Ki and the Macans save Porsche, all right. Ferrari had to be watching that. They had to be seeing the Uras sales, which is essentially a rebadged eight truck from Audi with a whole lot more horsepower. 00:58:17 Speaker 1: I mean, how did they not do that? 00:58:18 Speaker 3: They had to? 00:58:18 Speaker 4: And I think I got it like this particular electric car is not necessarily had the most favorable initial reviews. But my view is I will never count for ARI out and I think they probably are seeing some things in their data and with some certain customers who want this, and we'll. 00:58:34 Speaker 3: See, We'll certainly see. 00:58:35 Speaker 2: So let me jump to my favorite questions. 00:58:39 Speaker 1: I don't make you late for your trip back to the Midwest. Who are your early mentors who helped shape your career. 00:58:48 Speaker 4: My mentors went from kind of macro mentors to micro mentors, and so you know, in early days, of course, it was my parents. My parents had very different skill sets and I was so blessed that I got to work with both of them. There were some teachers kind of early on who were really extraordinary professors that both kind of I think triggered my love of learning. One gentleman, his name was Gary Hart, still living. I kind of look after him in his old age. He just fundamentally taught me how to be a good student. But what I found, though, is my mentors have become more micro mentors now like less than it's my whole life learning everything about something from this person is Now I find somebody who's really good at one thing, and I learned from them. 00:59:32 Speaker 3: I become friends with them. 00:59:34 Speaker 4: My current lead director on our public company board, Bill Swanson, he was the chairman and CEO of Atheon and wonderful man car collector and just brilliant at board governance and how to think things through. And I'm just learning so much listening to him. And so he's a real mentor of mine. And so I think I'm very much of that tribe of mentor approach. And I've had many and I love mentoring myself. 00:59:57 Speaker 2: So hum really really interesting. What are some of your favorite books? What are you reading right now? 01:00:02 Speaker 3: So I'm an avid reader. 01:00:04 Speaker 4: I read thirty to fifty books a year typically, and a lot of biographies. In the last four or five years, I was definitely on a music biography stint, so a lot of rock and roll biographies, and then I went through give us a few names, oh, everything from the Keith Richards to Slash to you name it. 01:00:23 Speaker 3: I mean a lot. 01:00:24 Speaker 4: I've read a lot of biographies of you know, Springsteen, anybody. Then I did an interesting kind of parallel set, which was music producers, and that was fun. So everything from the there's a famous book on Warner Brothers music that was about called Sonic Boom, which was all of the music producers that did that, to Clive Davis, to those types of folks. For this year, though, my reading theme is all about the founding of America. So I'm reading a lot of kind of American founding stuff. I've just figured it's a good time to do that. So biographies so far this year on George Washington, Benjamin Franklin, there are a bunch of other books around kind of a lot of the founding fathers. I'm also wading through Wealth of Nations again, first time since college because it was also published in seventeen seventy six. 01:01:13 Speaker 3: I had for yeah, that's a beast. That's a beast. 01:01:18 Speaker 4: But I would say one final piece is I was a sci fi fan forever, really, and I decided for the last two years I started rereading a bunch of the great series that I read long time ago. So I just read the entire Dune series for the third time in my life, and that was fun. The foundation series, Osamov Clark I think what I had forgotten is that almost all of those sci fi authors knew each other. Yes, they all kind of subscribed to some of the same magazines, and they get together for these little get togethers, and they were all kind of envisioning a future together and a lot of same themes, and especially right now around the challenges with AI are all embedded behind the Foundation series and even in Dune that people if you kind of have to read into it, but it's fascinating stuff. 01:02:08 Speaker 1: Larry Knivin, Philip K. 01:02:10 Speaker 4: Dick those Yes, and you know, of course, you know Hitchhiker's Guid the Galaxy. 01:02:15 Speaker 3: Well for a little bit of humor classic. 01:02:18 Speaker 1: Yes, what are you streaming these days? 01:02:19 Speaker 2: Give us your favorite either YouTube or Netflix or even podcasts. 01:02:24 Speaker 3: What's keeping you? Yes? 01:02:25 Speaker 4: So, I mean my my workout companion is a lot of podcasts. So, and and they've kind of shifted, I guess a little bit. So while I was, you know, during COVID, it was a lot of just sort of habits and mindset stuff and this sort of thing. And then when I discovered people like Scott Galloway his very humorous way to think about business, Tyler Cowen, I think is just absolutely brilliant, so great podcasts there. I've also been impressed with that Audible has a number of their own kind of i'vegatten back to the musical biography things. They have a lot of these short format kind of pie cast kind of other kind of QUASEI musical performances that are both kind of spoken word and music. And it's actually called the Words and Music Series, and that's been really fun to listen to some of. 01:03:13 Speaker 2: Those words and music. I'm gonna have to check that out, all right. Our final two questions, what sort of advice would you give a recent college grad interested in a career in either automobiles or insurance or business. 01:03:27 Speaker 4: I think I've just been I've been to two different commencement ceremonies. One was my daughters and another was some friends, and all of the commencement speakers right now are so focused on AI and trying to tell them it's going. 01:03:41 Speaker 3: To be okay. 01:03:42 Speaker 4: And not only do I think it's going to be okay, as I was reminded them and people of my own career, which is I work. My core business is what some people would call as a relatively boring industry insurance. Now you got to go into cool other stuff, not go into some of those things. I think there are there's so many opportunities in these industries that are established, they are stable. They need really smart people who want to work hard and remake what they are is. Don't overlook things that you consider boring today, you know, look at some of those and think, who are the types of people that are going into these that you can make a great career. I never imagined I'd be doing what I am today, and I think I have the coolest job you can have. 01:04:23 Speaker 1: Really really interesting. 01:04:25 Speaker 2: And our final question, what do you know about the world of automobiles or insurance today might have been useful thirty forty years ago when you are first ramping up. 01:04:36 Speaker 4: I think, you know, the the world has been predicting the demise of certain parts of the automobile industry for years, you know, and we saw it very recently with you know, this almost like Holy War. People view the difference between evs and internal combustion cars, and I'm very agnostic about all of that stuff, and it's very easy to kind of get sucked into those arguments. 01:05:00 Speaker 3: It's like, well, what do you think of EVS? I'm like, I don't know. 01:05:02 Speaker 4: There were EV's back in nineteen oh eight, there were steam cars in nineteen ten, and now you know, we've been on internal combustion for a long time. I think there will be more electric cars in the future, but I also think they're going to be great internal combustion cars. So I think I would just continue playing the big long game and don't worry about some of the little petty arguments that people can have that you know, it makes for good maybe cocktail party talk, but I'd like to see the big picture. 01:05:29 Speaker 1: Mkhil, thank you for being so generous with your time. 01:05:32 Speaker 2: We have been speaking with Mkhil Haggerty, Chairman and CEO of Haggarty Specialty Insurance. If you enjoy this conversation, well be sure and check out any of the six hundred and forty eight we've done previously. 01:05:46 Speaker 1: You can find. 01:05:47 Speaker 2: Those at YouTube, Apple, Spotify, Bloomberg, wherever you get your favorite podcasts. I would be remiss if I didn't thank the crack team that helps us put these conversations together each week. Alexis Noriega is my video producer. Sean Russo is my researcher. Anna Luca is my podcast producer. I'm Barry Retoults. You've been listening to Masters in Business on Bloomberg Radio