HCI GROUP, INC. AND SUBSIDIARIES Consolidated Balance Sheets (In thousands, except share amounts) June 30, December 31, 2026 2025 (Unaudited) Assets Fixed-maturity securities, available-for-sale, at fair value (amortized cost: $1,103,778 and $595,383, respectively, and allowance for credit losses: $0 and $0, respectively) (a) $ 1,091,041 $ 597,329 Equity securities, at fair value (cost: $55,700 and $61,597, respectively) 59,038 65,890 Limited partnership investments 16,394 17,690 Real estate investments 102,669 103,746 Other investments 5,000 5,000 Total investments 1,274,142 789,655 Cash and cash equivalents (a) 872,336 1,210,126 Restricted cash (a) 4,378 3,748 Income taxes receivable (a) 1,277 1,332 Deferred income tax assets, net (a) 1,088 2,237 Premiums receivable, net (allowance: $5,363 and $4,469, respectively) (a) 77,607 57,494 Prepaid reinsurance premiums (a) — 50,127 Reinsurance recoverable, net of allowance for credit losses: Paid losses and loss adjustment expenses (allowance: $0 and $0, respectively) (a) 26,613 27,855 Unpaid losses and loss adjustment expenses (allowance: $73 and $97, respectively) (a) 229,131 262,041 Deferred policy acquisition costs (a) 68,206 59,722 Property and equipment, net 27,503 28,939 Intangible assets, net 1,924 2,683 Funds withheld for assumed business 5,346 5,254 Other assets (a) 58,908 27,715 Total assets $ 2,648,459 $ 2,528,928 (a)See Note 12 for details of balances associated with consolidated variable interest entities. (continued) 1 HCI GROUP, INC. AND SUBSIDIARIES Consolidated Balance Sheets – (Continued) (In thousands, except share amounts) June 30, December 31, 2026 2025 (Unaudited) Liabilities, Redeemable Noncontrolling Interests and Equity Losses and loss adjustment expenses (a) $ 558,982 $ 576,495 Unearned premiums (a) 659,335 643,328 Advance premiums (a) 44,440 19,302 Ceded reinsurance premiums payable (a) 34,772 27,591 Assumed premiums payable (a) 4,049 1,744 Income taxes payable (a) 16,467 12,782 Deferred income tax liabilities, net (a) 1,001 3,814 Revolving credit facility 36,000 36,000 Long-term debt 31,465 31,877 Accrued expenses and other liabilities (a) 82,887 61,351 Total liabilities 1,469,398 1,414,284 Commitments and contingencies (Note 19) Redeemable noncontrolling interests (Note 16) 5,929 3,359 Equity: Common stock (no par value, 40,000,000 shares authorized, 12,469,972 and 12,992,147 shares issued and outstanding, respectively) — — Additional paid-in capital 340,854 428,109 Retained earnings 748,437 611,509 Accumulated other comprehensive (loss) income (9,382 ) 1,459 Total stockholders’ equity 1,079,909 1,041,077 Noncontrolling interests 93,223 70,208 Total equity 1,173,132 1,111,285 Total liabilities, redeemable noncontrolling interests and equity $ 2,648,459 $ 2,528,928 (a)See Note 12 for details of balances associated with consolidated variable interest entities. See accompanying Notes to Consolidated Financial Statements (unaudited). 2 HCI GROUP, INC. AND SUBSIDIARIES Consolidated Statements of Income (Unaudited) (In thousands, except per share amounts) Three Months Ended Six Months Ended June 30, June 30, 2026 2025 2026 2025 Revenue Gross premiums earned $ 320,824 $ 302,628 $ 647,030 $ 603,011 Premiums ceded (101,812 ) (102,522 ) (205,867 ) (202,157 ) Net premiums earned 219,012 200,106 441,163 400,854 Net investment income 18,890 16,445 36,191 30,196 Net realized investment gains 1,222 155 1,756 1,322 Net unrealized investment gains (losses) 743 1,180 (955 ) (726 ) Policy fee income 1,651 1,467 3,227 3,696 Other 5,135 2,567 8,153 3,011 Total revenue 246,653 221,920 489,535 438,353 Expenses Losses and loss adjustment expenses 71,076 64,457 136,676 123,748 Policy acquisition and other underwriting expenses 32,346 30,551 64,116 57,838 General and administrative personnel expenses 23,948 19,985 46,301 40,468 Interest expense 1,084 3,744 2,007 7,128 Other operating expenses 7,226 8,791 14,078 14,440 Total expenses 135,680 127,528 263,178 243,622 Income before income taxes 110,973 94,392 226,357 194,731 Income tax expense 28,073 24,113 58,414 50,222 Net income 82,900 70,279 167,943 144,509 Net income attributable to noncontrolling interests (9,103 ) (4,119 ) (20,739 ) (8,665 ) Net income after noncontrolling interests $ 73,797 $ 66,160 $ 147,204 $ 135,844 Basic earnings per share $ 5.78 $ 5.57 $ 11.39 $ 12.00 Diluted earnings per share $ 5.60 $ 5.18 $ 11.05 $ 10.57 See accompanying Notes to Consolidated Financial Statements (unaudited). 3 HCI GROUP, INC. AND SUBSIDIARIES Consolidated Statements of Comprehensive Income (Unaudited) (In thousands) Three Months Ended Six Months Ended June 30, June 30, 2026 2025 2026 2025 Net income $ 82,900 $ 70,279 $ 167,943 $ 144,509 Other comprehensive (loss) income, net of income taxes: Available-for-sale fixed-maturity securities (4,954 ) (184 ) (11,006 ) 1,907 Other comprehensive (loss) income, net of income taxes (4,954 ) (184 ) (11,006 ) 1,907 Comprehensive income 77,946 70,095 156,937 146,416 Comprehensive income attributable to noncontrolling interests (8,993 ) (4,119 ) (20,574 ) (8,665 ) Comprehensive income after noncontrolling interests $ 68,953 $ 65,976 $ 136,363 $ 137,751 See accompanying Notes to Consolidated Financial Statements (unaudited). 4 HCI GROUP, INC. AND SUBSIDIARIES Consolidated Statements of Equity For the Three Months Ended June 30, 2026 (Unaudited) (In thousands, except per share amount) Common Stock Additional Paid-In Retained Accumulated Other Comprehensive Total Stockholders’ Noncontrolling Total Shares Amount Capital Earnings Loss Equity Interests Equity Balance as of March 31, 2026 12,900,905 $ — $ 413,838 $ 679,721 $ (4,538 ) $ 1,089,021 $ 84,468 $ 1,173,489 Net income — — — 73,797 — 73,797 9,103 82,900 Other comprehensive loss, net of income taxes — — — — (4,844 ) (4,844 ) (110 ) (4,954 ) Issuance of restricted stock 3,750 — — — — — — — Forfeiture of restricted stock (693 ) — — — — — — — Net share settlements on vesting of restricted stock (70,452 ) — (11,121 ) — — (11,121 ) — (11,121 ) Repurchase of common stock (363,538 ) — (57,720 ) — — (57,720 ) — (57,720 ) Repurchase of noncontrolling interests — — (6,580 ) — — (6,580 ) (3,563 ) (10,143 ) Other adjustments to noncontrolling interests — — (147 ) — — (147 ) 147 — Common stock dividends — — — (5,081 ) — (5,081 ) — (5,081 ) Stock-based compensation — — 2,584 — — 2,584 755 3,339 Reclassification of nonrefundable subscriber surplus contributions — — — — — — 2,423 2,423 Balance as of June 30, 2026 12,469,972 $ — $ 340,854 $ 748,437 $ (9,382 ) $ 1,079,909 $ 93,223 $ 1,173,132 See accompanying Notes to Consolidated Financial Statements (unaudited). 5 HCI GROUP, INC. AND SUBSIDIARIES Consolidated Statements of Equity – (Continued) For the Three Months Ended June 30, 2025 (Unaudited) (In thousands, except per share amount) Common Stock Additional Paid-In Retained Accumulated Other Comprehensive Total Stockholders’ Noncontrolling Total Shares Amount Capital Earnings Income Equity Interests Equity Balance as of March 31, 2025 10,765,336 $ — $ 124,170 $ 397,171 $ 1,342 $ 522,683 $ 20,149 $ 542,832 Net income — — — 66,160 — 66,160 4,119 70,279 Other comprehensive loss, net of income taxes — — — — (184 ) (184 ) — (184 ) Issuance of restricted stock 9,020 — — — — — — — Forfeiture of restricted stock (1,100 ) — — — — — — — Net share settlements on vesting of restricted stock (266 ) — (40 ) — — (40 ) — (40 ) Conversion of senior notes to common stock 2,183,894 — 172,582 — — 172,582 — 172,582 Common stock dividends — — — (4,618 ) — (4,618 ) — (4,618 ) Stock-based compensation — — 1,994 — — 1,994 701 2,695 Reclassification of nonrefundable subscriber surplus contributions — — — — — — 1,138 1,138 Balance as of June 30, 2025 12,956,884 $ — $ 298,706 $ 458,713 $ 1,158 $ 758,577 $ 26,107 $ 784,684 See accompanying Notes to Consolidated Financial Statements (unaudited). 6 HCI GROUP, INC. AND SUBSIDIARIES Consolidated Statements of Equity – (Continued) For the Six Months Ended June 30, 2026 (Unaudited) (In thousands, except per share amount) Common Stock Additional Paid-In Retained Accumulated Other Comprehensive Total Stockholders’ Noncontrolling Total Shares Amount Capital Earnings Income (Loss) Equity Interests Equity Balance as of December 31, 2025 12,992,147 $ — $ 428,109 $ 611,509 $ 1,459 $ 1,041,077 $ 70,208 $ 1,111,285 Net income — — — 147,204 — 147,204 20,739 167,943 Other comprehensive loss, net of income taxes — — — — (10,841 ) (10,841 ) (165 ) (11,006 ) Exercise of stock options 20,000 — 800 — — 800 — 800 Issuance of restricted stock 3,750 — — — — — — — Forfeiture of restricted stock (1,386 ) — — — — — — — Net share settlements on vesting of restricted stock (70,930 ) — (11,202 ) — — (11,202 ) — (11,202 ) Repurchase of common stock (473,609 ) — (75,221 ) — — (75,221 ) — (75,221 ) Repurchase of noncontrolling interests — — (6,580 ) — — (6,580 ) (3,563 ) (10,143 ) Other adjustments to noncontrolling interests — — (259 ) — — (259 ) 259 — Common stock dividends — — — (10,276 ) — (10,276 ) — (10,276 ) Stock-based compensation — — 5,207 — — 5,207 1,491 6,698 Reclassification of nonrefundable subscriber surplus contributions — — — — — — 4,254 4,254 Balance as of June 30, 2026 12,469,972 $ — $ 340,854 $ 748,437 $ (9,382 ) $ 1,079,909 $ 93,223 $ 1,173,132 See accompanying Notes to Consolidated Financial Statements (unaudited). 7 HCI GROUP, INC. AND SUBSIDIARIES Consolidated Statements of Equity – (Continued) For the Six Months Ended June 30, 2025 (Unaudited) (In thousands, except per share amount) Common Stock Additional Paid-In Retained Accumulated Other Comprehensive Total Stockholders’ Noncontrolling Total Shares Amount Capital Earnings (Loss) Income Equity Interests Equity Balance as of December 31, 2024 10,767,184 $ — $ 122,289 $ 331,793 $ (749 ) $ 453,333 $ 14,017 $ 467,350 Net income — — — 135,844 — 135,844 8,665 144,509 Other comprehensive income, net of income taxes — — — — 1,907 1,907 — 1,907 Issuance of restricted stock 10,020 — — — — — — — Forfeiture of restricted stock (1,850 ) — — — — — — — Net share settlements on vesting of restricted stock (5,533 ) — (679 ) — — (679 ) — (679 ) Conversion of senior notes to common stock 2,187,063 — 172,832 — — 172,832 — 172,832 Common stock dividends — — — (8,924 ) — (8,924 ) — (8,924 ) Stock-based compensation — — 4,264 — — 4,264 1,403 5,667 Reclassification of nonrefundable subscriber surplus contributions — — — — — — 2,022 2,022 Balance as of June 30, 2025 12,956,884 $ — $ 298,706 $ 458,713 $ 1,158 $ 758,577 $ 26,107 $ 784,684 See accompanying Notes to Consolidated Financial Statements (unaudited). 8 HCI GROUP, INC. AND SUBSIDIARIES Consolidated Statements of Cash Flows (Unaudited) (In thousands) Six Months Ended June 30, 2026 2025 Cash flows from operating activities: Net income after noncontrolling interests $ 147,204 $ 135,844 Net income attributable to noncontrolling interests 20,739 8,665 Net income 167,943 144,509 Adjustments to reconcile net income to net cash provided by operating activities: Stock-based compensation expense 6,698 5,667 Net accretion of discount on investments in available-for-sale fixed-maturity securities (498 ) (1,389 ) Depreciation and amortization 4,285 6,560 Deferred income tax expense (benefit) 2,013 (1,353 ) Net realized investment gains (1,756 ) (1,322 ) Net unrealized investment losses 955 726 Credit loss expense - reinsurance recoverable (24 ) (49 ) Net loss from limited partnership investments 399 658 Debt conversion expense — 1,125 Gain on sale of real estate investments (354 ) (440 ) Foreign currency remeasurement loss 192 47 Other non-cash items 317 71 Changes in operating assets and liabilities: Income taxes 3,740 16,176 Premiums receivable, net (20,113 ) (15,244 ) Prepaid reinsurance premiums 50,127 92,060 Reinsurance recoverable 34,176 120,565 Deferred policy acquisition costs (8,484 ) (10,835 ) Funds withheld for assumed business (92 ) 3,152 Other assets (19,842 ) (14,587 ) Losses and loss adjustment expenses (17,513 ) (149,008 ) Unearned premiums 16,007 42,781 Advance premiums 25,138 24,810 Reinsurance payable on paid losses and loss adjustment expenses — (2,369 ) Ceded reinsurance premiums payable 7,181 19,808 Assumed premiums payable 2,305 (1,801 ) Accrued expenses and other liabilities 21,127 26,687 Net cash provided by operating activities 273,927 307,005 (continued) 9 HCI GROUP, INC. AND SUBSIDIARIES Consolidated Statements of Cash Flows – (Continued) (Unaudited) (In thousands) Six Months Ended June 30, 2026 2025 Cash flows from investing activities: Investments in limited partnerships — (270 ) Return of capital from limited partnership investments 897 644 Purchase of property and equipment (625 ) (2,254 ) Purchase of real estate investments (983 ) (8,862 ) Purchase of available-for-sale fixed-maturity securities (520,005 ) (136,582 ) Purchase of equity securities (27,760 ) (23,293 ) Proceeds from sales of real estate investments 760 2,013 Proceeds from sales of available-for-sale fixed-maturity securities 3,643 3,359 Proceeds from calls, repayments and maturities of available-for-sale fixed-maturity securities 8,512 263,643 Proceeds from sales of equity securities 35,173 21,621 Net cash (used in) provided by investing activities (500,388 ) 120,019 Cash flows from financing activities: Common stock dividends (10,276 ) (8,924 ) Proceeds from exercise of stock options 800 — Payment of other noncontrolling interests issuance costs (375 ) — Repayment under revolving credit facility, net — (4,000 ) Subscriber surplus contributions, net 6,824 2,736 Repayment of long-term debt (442 ) (268 ) Debt conversion costs paid — (1,125 ) Payment of net share settlements and other (11,202 ) (687 ) Repurchase of common stock (74,476 ) — Repurchase of noncontrolling interests (10,043 ) — Payment for deposit accounting assets (11,330 ) — Net cash used in financing activities (110,520 ) (12,268 ) Effect of exchange rate changes on cash (179 ) (45 ) Net (decrease) increase in cash and cash equivalents and restricted cash (337,160 ) 414,711 Cash and cash equivalents and restricted cash at beginning of period 1,213,874 536,185 Cash and cash equivalents and restricted cash at end of period $ 876,714 $ 950,896 (continued) 10 HCI GROUP, INC. AND SUBSIDIARIES Consolidated Statements of Cash Flows – (Continued) (Unaudited) (In thousands) Six Months Ended June 30, 2026 2025 Supplemental disclosure of cash flow information: Income taxes paid, net of refunds $ 52,662 $ 37,952 Interest paid 1,864 3,697 Non-cash investing and financing activities: Unrealized (loss) gain on investments in available-for-sale fixed-maturity securities, net of income taxes (11,006 ) 1,907 Conversion of 4.75% Convertible Senior Notes — 172,500 Receivable from sale of equity securities 121 — Payable on purchase of equity securities 115 184 Payable on purchase of available-for-sale fixed-maturity securities — 127 Payable related to repurchase of common stock 745 Payable related to repurchase of noncontrolling interests 100 — See accompanying Notes to Consolidated Financial Statements (unaudited). 11 HCI GROUP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (unaudited) (In thousands, except share and per share amounts, unless otherwise stated) Note 1 -- Nature of Operations HCI Group, Inc., together with its subsidiaries (“HCI” or the “Company”), is primarily engaged in the property and casualty insurance business through two insurance companies, Homeowners Choice Property & Casualty Insurance Company, Inc. (“HCPCI”) and TypTap Insurance Company (“TTIC”). The Company provides various homeowners’ property and casualty insurance products for properties located in Florida, which is the Company's primary market, as well as in other states in the northeast and southeast regions of the United States (“U.S.”). A third insurance subsidiary, perRisk Insurance Company (“perRisk”), is domiciled in the State of Arizona and has not yet commenced its surplus lines insurance business. The Company's insurance operations are supported by other insurance-related subsidiaries within the consolidated group. Exzeo Group, Inc. (“Exzeo”), a publicly traded majority-owned subsidiary, provides turn-key insurance technology and operations solutions based on a proprietary platform of purpose-built software and data analytics applications specifically designed for the property and casualty insurance ecosystem. The Company utilizes Exzeo's internally developed software technologies to identify profitable underwriting opportunities, drive efficiency in claim processing and settlements, and streamline operations across our insurance operations and other insurance-related businesses. The Company also provides attorney-in-fact (“AIF”) services for Condo Owners Reciprocal Exchange (“CORE”) and Tailrow Insurance Exchange (“Tailrow”), both of which are reciprocal insurance exchanges owned by their policyholders. Although the Company does not have any equity interest in CORE and Tailrow, the Company is required to consolidate them as their primary beneficiary. In addition, the Company's commercial real estate subsidiary is primarily engaged in developing and operating commercial properties for investment purposes or internal use. HCI Group, Inc. was incorporated in the State of Florida in 2006 and its common stock is currently listed on the New York Stock Exchange (“NYSE”) under the symbol “HCI.” Exzeo completed its initial public offering in November of 2025 and is currently listed on the NYSE under the symbol “XZO.” As of June 30, 2026, HCI Group, Inc. owned approximately 83.1% of Exzeo’s outstanding shares of common stock, inclusive of its unvested restricted stock. Note 2 -- Summary of Significant Accounting Policies Basis of Presentation The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) for interim financial information, and the Securities and Exchange Commission (“SEC”) rules for interim financial reporting. Certain information and footnote disclosures normally included in consolidated financial statements prepared in accordance with U.S. GAAP have been omitted pursuant to such rules and regulations. However, in the opinion of management, the accompanying unaudited consolidated financial statements reflect all normal recurring adjustments necessary to present fairly the Company’s financial position as of June 30, 2026 and the results of operations and cash flows for the interim periods presented. The results of operations for the interim periods presented are not necessarily indicative of the results of operations to be expected for any subsequent interim period or for the fiscal year ending December 31, 2026. The accompanying unaudited consolidated financial statements and notes thereto should be read in conjunction with the audited consolidated financial statements for the year ended December 31, 2025 included in the Company’s Form 10-K, which was filed with the SEC on February 26, 2026 (the “2025 Annual 12 HCI GROUP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (unaudited) (In thousands, except share and per share amounts, unless otherwise stated) Report”). Unless otherwise noted, the Company’s accounting policies do not differ from those disclosed in the 2025 Annual Report. The unaudited consolidated financial statements have been prepared in U.S. dollars and include the accounts of HCI Group, Inc. and its subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. In addition, the Company evaluates its relationships or investments for consolidation pursuant to authoritative accounting guidance related to the consolidation of variable interest entities (“VIE”) under the Variable Interest Model prescribed by the Financial Accounting Standards Board (“FASB”). A VIE is consolidated when the Company has the power to direct activities that most significantly impact the economic performance of the VIE and has the obligation to absorb losses or the right to receive benefits from the VIE that could potentially be significant to the VIE. Refer to Note 12 “Variable Interest Entities” for additional information. Certain prior period amounts have been reclassified to conform with current period presentation. Use of Estimates The preparation of the interim unaudited consolidated financial statements in conformity with U.S. GAAP requires the Company to make estimates and assumptions that affect amounts reported in the consolidated financial statements and accompanying notes. The Company's estimates are based on the relevant information available at the end of each period. Actual results could differ materially from these estimates under different assumptions or market conditions. The Company's estimates specific to losses and loss adjustment expenses, reinsurance recoverable, income taxes, stock-based compensation expense, and limited partnership investments involve the most significant judgments and estimates related to the consolidated financial statements. Note 3 -- Recent Accounting Pronouncements Adopted Accounting Standards Update No. 2025-05. In July 2025, the FASB issued Accounting Standards Update No. 2025-05 (“ASU 2025-05”) Financial Instruments–Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets. This update simplifies the estimation of current expected credit losses on current accounts receivable and current contract assets related to revenue from contracts with customers by allowing all entities to assume that current conditions as of the balance sheet date will not change for the remaining life of the current accounts receivable and current contract assets. ASU 2025-05 is effective for all entities for fiscal years and interim periods beginning after December 15, 2025. The adoption of this update did not have a material impact on the Company’s financial position or results of operation. Pending Adoption Accounting Standards Update No. 2025-01 and 2024-03. In January 2025, the FASB issued Accounting Standards Update No. 2025-01 (“ASU 2025-01”) Income Statement–Reporting Comprehensive Income–Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date. This update clarifies the effective date of Accounting Standards Update No. 2024-03 (“ASU 2024-03”) Income Statement–Reporting Comprehensive Income–Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which was issued by the FASB in November 2024. For public business entities, ASU 2024-03 enhances disclosures by requiring the disaggregation of certain expense captions presented within the income 13 HCI GROUP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (unaudited) (In thousands, except share and per share amounts, unless otherwise stated) statement, such as employee compensation and intangible asset amortization. In addition, the total relevant expense caption on the income statement must be reconciled to the aggregate of the separately disclosed expense categories with the difference represented by an “other items” amount which is qualitatively described. ASU 2024-03 is effective for all public business entities for annual reporting periods beginning after December 15, 2026 and interim periods within annual reporting periods beginning after December 15, 2027. Early adoption is permitted. The Company is evaluating its impact. Accounting Standards Update No. 2025-06. In September 2025, the FASB issued Accounting Standards Update No. 2025-06 (“ASU 2025-06”) Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software. This update enhances guidance on the capitalization of software development costs by eliminating project phase based criteria and clarifying the conditions signifying significant development uncertainty used by entities to evaluate when the probable-to-complete recognition threshold is met. ASU 2025-06 is effective for all entities for fiscal years and interim periods beginning after December 15, 2027. Early adoption is permitted. The Company is evaluating its impact. Note 4 -- Cash and Cash Equivalents and Restricted Cash The following table provides a reconciliation of cash and cash equivalents and restricted cash reported within the Company’s consolidated balance sheets that sum to the total of the same such amounts shown in the consolidated statements of cash flows: June 30, December 31, 2026 2025 Cash and cash equivalents $ 872,336 $ 1,210,126 Restricted cash 4,378 3,748 Cash and cash equivalents and restricted cash $ 876,714 $ 1,213,874 The majority of the Company’s cash and cash equivalents are held at major financial institutions. Certain account balances exceed the Federal Deposit Insurance Corporation insurance limits of $250 per account. As a result, there is a concentration of credit risk related to amounts in excess of the insurance limits. The Company regularly monitors the financial stability of these financial institutions and believes there is no exposure to any significant credit risk in cash and cash equivalents. 14 HCI GROUP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (unaudited) (In thousands, except share and per share amounts, unless otherwise stated) Note 5 -- Investments Available-for-Sale Fixed-Maturity Securities The Company holds investments in fixed-maturity securities classified as available-for-sale. As of June 30, 2026 and December 31, 2025, the cost or amortized cost, allowance for credit loss, gross unrealized gains and losses, and estimated fair value of the Company’s available-for-sale fixed-maturity securities by security type were as follows: Cost or Amortized Allowance for Credit Gross Unrealized Gross Unrealized Estimated Fair Cost Loss Gains Losses Value As of June 30, 2026 U.S. Treasury and U.S. government agencies $ 835,084 $ — $ 122 $ (10,902 ) $ 824,304 Corporate 242,419 — 52 (1,720 ) 240,751 Commercial mortgage-backed securities 26,275 — 49 (338 ) 25,986 Available-for-sale fixed-maturity securities $ 1,103,778 $ — $ 223 $ (12,960 ) $ 1,091,041 As of December 31, 2025 U.S. Treasury and U.S. government agencies $ 332,284 $ — $ 1,785 $ (717 ) $ 333,352 Corporate 241,843 — 1,463 (384 ) 242,922 Commercial mortgage-backed securities 21,256 — 74 (275 ) 21,055 Available-for-sale fixed-maturity securities $ 595,383 $ — $ 3,322 $ (1,376 ) $ 597,329 Expected maturities may differ from contractual maturities as borrowers may have the right to call or prepay obligations with or without penalties. As of June 30, 2026 and December 31, 2025, the scheduled contractual maturities of available-for-sale fixed-maturity securities, with securities not due at a single maturity date shown separately, were as follows: June 30, 2026 December 31, 2025 Cost or Estimated Cost or Estimated Amortized Cost Fair Value Amortized Cost Fair Value Due in one year or less $ 44,388 $ 44,366 $ 10,202 $ 10,214 Due after one year through five years 531,003 527,011 353,454 354,648 Due after five years through ten years 501,611 493,265 209,970 210,963 Due after ten years 501 413 501 449 Commercial mortgage-backed securities 26,275 25,986 21,256 21,055 Available-for-sale fixed-maturity securities $ 1,103,778 $ 1,091,041 $ 595,383 $ 597,329 15 HCI GROUP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (unaudited) (In thousands, except share and per share amounts, unless otherwise stated) Securities on Deposit As of June 30, 2026 and December 31, 2025, the fair value of available-for-sale fixed-maturity securities on deposit with various regulatory authorities was $1,137 and $1,807, respectively. Sales of Available-for-Sale Fixed-Maturity Securities Proceeds received and the gross realized gains and losses from sales of available-for-sale fixed-maturity securities for the three and six months ended June 30, 2026 and 2025 were as follows: Three Months Ended Six Months Ended June 30, June 30, 2026 2025 2026 2025 Proceeds $ 1,765 $ 749 $ 3,643 $ 3,359 Gross realized gains $ 6 $ 14 $ 55 $ 38 Gross realized losses $ (8 ) $ — $ (8 ) $ (4 ) Gross Unrealized Losses for Available-for-Sale Fixed-Maturity Securities As of June 30, 2026 and December 31, 2025, available-for-sale fixed-maturity securities with gross unrealized loss positions by investment category and length of time the individual securities have been in a continuous loss position were as follows: Less Than Twelve Months Twelve Months or Longer Total Gross Estimated Gross Estimated Gross Estimated Unrealized Fair Unrealized Fair Unrealized Fair As of June 30, 2026 Losses Value Losses Value Losses Value U.S. Treasury and U.S. government agencies $ (10,736 ) $ 709,989 $ (166 ) $ 2,915 $ (10,902 ) $ 712,904 Corporate (1,532 ) 210,056 (188 ) 1,394 (1,720 ) 211,450 Commercial mortgage-backed securities (338 ) 15,666 — — (338 ) 15,666 Total $ (12,606 ) $ 935,711 $ (354 ) $ 4,309 $ (12,960 ) $ 940,020 Less Than Twelve Months Twelve Months or Longer Total Gross Estimated Gross Estimated Gross Estimated Unrealized Fair Unrealized Fair Unrealized Fair As of December 31, 2025 Losses Value Losses Value Losses Value U.S. Treasury and U.S. government agencies $ (553 ) $ 208,273 $ (164 ) $ 2,918 $ (717 ) $ 211,191 Corporate (289 ) 28,303 (95 ) 1,187 (384 ) 29,490 Commercial mortgage-backed securities (275 ) 16,749 — — (275 ) 16,749 Total $ (1,117 ) $ 253,325 $ (259 ) $ 4,105 $ (1,376 ) $ 257,430 As of June 30, 2026 and December 31, 2025, there were 70 and 47 available-for-sale fixed-maturity securities in an unrealized loss position, respectively. 16 HCI GROUP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (unaudited) (In thousands, except share and per share amounts, unless otherwise stated) Allowance for Credit Losses of Available-for-Sale Fixed-Maturity Securities The Company regularly reviews its individual available-for-sale fixed-maturity securities for credit impairment. The Company considers various factors in determining whether a credit loss exists for each individual security, including: •the financial condition and near-term prospects of the issuer, including any specific events affecting its operations or earnings; •the extent to which the market value of the security has been below its cost or amortized cost; •general market conditions and industry or sector specific factors and other qualitative factors; •nonpayment by the issuer of its contractually obligated interest and principal payments; and •the Company’s intent and ability to hold the investment for a period of time sufficient to allow for the recovery of costs. There was no balance or activity in the allowance for credit losses of available-for-sale fixed-maturity securities during the three and six months ended June 30, 2026 and 2025. Equity Securities The Company holds investments in equity securities measured at fair values which are readily determinable. As of June 30, 2026 and December 31, 2025, the cost, gross unrealized gains and losses, and estimated fair value of the Company’s equity securities were as follows: Gross Unrealized Gross Unrealized Estimated Fair Cost Gains Losses Value June 30, 2026 $ 55,700 $ 5,693 $ (2,355 ) $ 59,038 December 31, 2025 $ 61,597 $ 6,204 $ (1,911 ) $ 65,890 The table below presents the portion of unrealized gains and losses in the Company’s consolidated statements of income related to equity securities still held: Three Months Ended Six Months Ended June 30, June 30, 2026 2025 2026 2025 Net gains recognized $ 1,967 $ 1,321 $ 754 $ 562 Exclude: Net realized gains recognized for securities sold 1,224 141 1,709 1,288 Net unrealized investment gains (losses) $ 743 $ 1,180 $ (955 ) $ (726 ) 17 HCI GROUP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (unaudited) (In thousands, except share and per share amounts, unless otherwise stated) Sales of Equity Securities Proceeds received and the gross realized gains and losses from sales of equity securities for the three and six months ended June 30, 2026 and 2025 were as follows: Three Months Ended Six Months Ended June 30, June 30, 2026 2025 2026 2025 Proceeds $ 20,099 $ 12,079 $ 35,173 $ 21,621 Gross realized gains $ 1,619 $ 508 $ 2,375 $ 1,839 Gross realized losses $ (395 ) $ (367 ) $ (666 ) $ (551 ) Limited Partnership Investments The Company has interests in limited partnerships that are not registered or readily tradeable on a securities exchange. These partnerships are private equity funds managed by general partners who make decisions with regard to financial policies and operations. As such, the Company is not the primary beneficiary and does not consolidate these partnerships. The following table summarizes limited partnership investments: June 30, 2026 December 31, 2025 Carrying Unfunded Carrying Unfunded Investment Strategy Value Balance (%) (a) Value Balance (%) (a) Primarily in senior secured loans and, to a limited extent, in other debt and equity securities of private U.S. lower-middle-market companies. (b)(c)(e) $ 1,668 $ — 12.22 $ 1,877 $ — 12.31 Value creation through active distressed debt investing primarily in bank loans, public and private corporate bonds, asset-backed securities, and equity securities received in connection with debt restructuring. (b)(d)(e) 573 — 1.30 587 — 1.27 High returns and long-term capital appreciation through investments in the power, utility and energy industries, and in the infrastructure sector. (b)(f)(g) 2,854 — 0.18 2,769 — 0.18 Value-oriented investments in less liquid and mispriced senior and junior debts of private equity-backed companies. (b)(h)(i) 1,198 — 0.53 1,333 — 0.53 Value-oriented investments in mature real estate private equity funds and portfolios globally. (b)(j) 5,531 1,706 1.32 6,182 2,042 1.32 Risk-adjusted returns on credit and equity investments, primarily in private equity-owned companies. (b)(k) 4,570 2,085 0.53 4,942 1,610 0.54 Limited partnership investments $ 16,394 $ 3,791 $ 17,690 $ 3,652 (a)Represents the Company’s percentage investment in the fund as of each balance sheet date. (b)Except under certain circumstances, withdrawals from the funds or any assignments are not permitted. Distributions, except income from late admission of a new limited partner, will be received when underlying investments of the funds are liquidated. 18 HCI GROUP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (unaudited) (In thousands, except share and per share amounts, unless otherwise stated) (c)The term is expected to be two years following the maturity of the fund’s outstanding leverage. Although the capital commitment period has expired, follow-on investments and pending commitments may require additional fundings. (d)Effective July 1, 2023, this investment is in the process of winding down. Although the capital commitment period has ended, the general partner could still request an additional funding under certain circumstances. (e)At the fund manager’s discretion, the term of the fund may be extended for up to two additional one-year periods. (f)Expected to have a ten-year term. The capital commitment period has expired but the general partner may request additional funding for follow-on investment. (g)With the consent of a supermajority of partners, the term of the fund may be extended for up to three additional one-year periods. (h)Expected to have an eight-year term from the commencement date, which can be extended for up to two additional one-year periods with the consent of either the advisory committee or a majority of limited partners. (i)The capital commitment period has ended but an additional funding may be requested. (j)The term is expected to end November 27, 2027. The term may be extended for up to four additional one-year periods at the general partner’s discretion, and up to two additional one-year periods with the consent of the advisory committee. (k)Expected to have an eight-year term after the final admission date. The term may be extended for an additional one-year period at the general partner’s discretion, and up to two additional one-year periods with the consent of either the advisory committee or a majority of limited partners. As of June 30, 2026 and December 31, 2025, the Company’s net cumulative contributed capital to the limited partnership investments totaled $17,800 and $18,697, respectively, and the Company’s maximum exposure to loss aggregated $16,394 and $17,690, respectively. Real Estate Investments The following table summarizes real estate investments: June 30, December 31, 2026 2025 Land $ 49,630 $ 50,052 Land improvements 14,401 14,760 Buildings and building improvements 43,792 44,019 Tenant and leasehold improvements 2,149 2,265 Construction in progress 822 89 Other 1,913 2,001 Total, at cost 112,707 113,186 Less: accumulated depreciation (10,038 ) (9,440 ) Real estate investments $ 102,669 $ 103,746 Depreciation expense related to real estate investments was $677 and $473 for the three months ended June 30, 2026 and 2025, respectively, and $1,406 and $812 for the six months ended June 30, 2026 and 2025, respectively. 19 HCI GROUP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (unaudited) (In thousands, except share and per share amounts, unless otherwise stated) Net Investment Income The following table summarizes net investment income: Three Months Ended Six Months Ended June 30, June 30, 2026 2025 2026 2025 Available-for-sale fixed-maturity securities $ 10,221 $ 6,841 $ 18,091 $ 14,355 Equity securities 751 660 1,404 1,147 Investment expense (206 ) (154 ) (409 ) (339 ) Limited partnership investments (75 ) (32 ) (399 ) (658 ) Real estate investments 73 455 528 773 Cash and cash equivalents 7,995 8,675 16,716 14,918 Other 131 — 260 — Net investment income $ 18,890 $ 16,445 $ 36,191 $ 30,196 Note 6 -- Fair Value Measurements The Company records and discloses certain financial assets and liabilities at their estimated fair values. The fair value hierarchy prioritizes the inputs to valuation techniques used to measure fair value into three broad levels as follows: Level 1 – Unadjusted quoted prices in active markets for identical assets. Level 2 – Other inputs that are observable for the asset, either directly or indirectly such as quoted prices for identical assets that are not observable throughout the full term of the asset. Level 3 – Inputs that are unobservable. Valuation Methodology Cash and Cash Equivalents Cash and cash equivalents primarily consist of cash as well as money-market funds and certificates of deposit maturing within three months from the time of purchase. Their carrying value approximates fair value due to the short maturity and high liquidity of these funds. Restricted Cash Restricted cash represents cash held by state authorities and the carrying value approximates fair value. 20 HCI GROUP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (unaudited) (In thousands, except share and per share amounts, unless otherwise stated) Available-for-Sale Fixed-Maturity and Equity Securities Estimated fair values of the Company’s available-for-sale fixed-maturity and equity securities are determined in accordance with U.S. GAAP, using valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. Fair values are generally determined using quoted prices in active markets for identical securities or other directly or indirectly observable inputs, including quoted prices for similar securities. In those instances where observable inputs are not available, fair values are determined using unobservable inputs. Unobservable inputs reflect the Company’s own assumptions about the assumptions that market participants would use in pricing the security and are developed based on the best information available in the circumstances. Fair value estimates derived from unobservable inputs are significantly affected by the assumptions used, including the discount rates and the estimated amounts and timing of future cash flows. The derived fair value estimates cannot be substantiated by comparison to independent markets and are not necessarily indicative of the amounts that would be realized in a current market exchange. The estimated fair values for securities are determined by management, utilizing prices obtained from an independent pricing service and information provided by brokers, which are level 1 or level 2 inputs depending on the asset class. Management reviews the assumptions and methods utilized by the pricing service and then compares the relevant data and pricing to other market data. The Company gains assurance of the overall reasonableness and consistent application of the assumptions and methodologies, and compliance with accounting standards for fair value determination through ongoing monitoring of the reported fair values. Other Investments The following table summarizes other investments held by the Company and the method used in estimating the fair value: MaturityDate Valuation Methodology 10.50% Surplus Note 2030 Discounted cash flow method/Level 3 inputs Revolving Credit Facility The Company has an amount outstanding under a revolving credit facility. The interest rate is variable and is periodically adjusted based on the Secured Overnight Financing Rate (“SOFR”) plus a ten basis points adjustment plus a margin based on the debt-to-capital ratio. As a result, the carrying value approximates fair value. Long-Term Debt The following table summarizes the Company’s long-term debt and methods used in estimating their fair values: MaturityDate Valuation Methodology 4.55% Promissory Note 2036 Discounted cash flow method/Level 3 inputs 5.50% Promissory Note 2033 Discounted cash flow method/Level 3 inputs 5.65% Promissory Note 2035 Discounted cash flow method/Level 3 inputs 21 HCI GROUP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (unaudited) (In thousands, except share and per share amounts, unless otherwise stated) Assets Measured at Estimated Fair Value on a Recurring Basis The following tables present information about the Company’s financial assets measured at estimated fair value on a recurring basis. The tables indicate the fair value hierarchy of the valuation techniques utilized by the Company to determine such fair value as of June 30, 2026 and December 31, 2025: Fair Value Measurements Using (Level 1) (Level 2) (Level 3) Total As of June 30, 2026 Cash and cash equivalents $ 872,336 $ — $ — $ 872,336 Restricted cash $ 4,378 $ — $ — $ 4,378 Available-for-sale fixed-maturity securities: U.S. Treasury and U.S. government agencies $ 804,798 $ 19,506 $ — $ 824,304 Corporate — 240,751 — 240,751 Commercial mortgage-backed securities — 25,986 — 25,986 Available-for-sale fixed-maturity securities $ 804,798 $ 286,243 $ — $ 1,091,041 Equity securities $ 57,703 $ 1,335 $ — $ 59,038 Fair Value Measurements Using (Level 1) (Level 2) (Level 3) Total As of December 31, 2025 Cash and cash equivalents $ 1,210,126 $ — $ — $ 1,210,126 Restricted cash $ 3,748 $ — $ — $ 3,748 Available-for-sale fixed-maturity securities: U.S. Treasury and U.S. government agencies $ 313,420 $ 19,932 $ — $ 333,352 Corporate — 242,922 — 242,922 Commercial mortgage-backed securities — 21,055 — 21,055 Available-for-sale fixed-maturity securities $ 313,420 $ 283,909 $ — $ 597,329 Equity securities $ 64,545 $ 1,345 $ — $ 65,890 Assets and Liabilities Carried at Other Than Fair Value The following tables present fair value information for assets and liabilities carried on the consolidated balance sheets at amounts other than fair value as of June 30, 2026 and December 31, 2025: Carrying Fair Value Measurements Using Estimated Value (Level 1) (Level 2) (Level 3) Fair Value As of June 30, 2026 Other investments $ 5,000 $ — $ — $ 5,201 $ 5,201 Revolving credit facility $ 36,000 $ — $ 36,000 $ — $ 36,000 Long-term debt: 4.55% Promissory Note $ 3,931 $ — $ — $ 3,682 $ 3,682 5.50% Promissory Note 11,142 — — 10,995 10,995 5.65% Promissory Note 16,392 — — 16,164 16,164 Long-term debt $ 31,465 $ — $ — $ 30,841 $ 30,841 22 HCI GROUP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (unaudited) (In thousands, except share and per share amounts, unless otherwise stated) Carrying Fair Value Measurements Using Estimated Value (Level 1) (Level 2) (Level 3) Fair Value As of December 31, 2025 Other investments $ 5,000 $ — $ — $ 5,223 $ 5,223 Revolving credit facility $ 36,000 $ — $ 36,000 $ — $ 36,000 Long-term debt: 4.55% Promissory Note $ 4,080 $ — $ — $ 3,863 $ 3,863 5.50% Promissory Note 11,262 — — 11,313 11,313 5.65% Promissory Note 16,535 — — 16,615 16,615 Long-term debt $ 31,877 $ — $ — $ 31,791 $ 31,791 Note 7 -- Intangible Assets, Net The following table summarizes intangible assets, net: June 30, December 31, 2026 2025 In-place leases $ 2,221 $ 2,221 Policy renewal rights - United 10,100 10,100 Non-compete agreements - United (a) 314 314 Total, at cost 12,635 12,635 Less: accumulated amortization (10,711 ) (9,952 ) Intangible assets, net $ 1,924 $ 2,683 (a)Fully amortized. Amortization expense for intangible assets was $310 and $638 for the three months ended June 30, 2026 and 2025, respectively, and $759 and $1,279 for the six months ended June 30, 2026 and 2025, respectively. Note 8 -- Revolving Credit Facility As of June 30, 2026 and December 31, 2025, the Company had an outstanding balance of $36,000 under a senior secured revolving credit facility with Fifth Third Bank (“Revolving Credit Facility”). The Revolving Credit Facility, as amended on November 5, 2025, currently provides borrowing capacity of up to $150,000 and expires on November 5, 2030. Borrowings under the Revolving Credit Facility bear interest at an annual rate equal to the one or three month SOFR plus a ten basis points adjustment plus a margin based on the debt-to-capital ratio, with interest payments due in arrears on January 1, April 1, July 1, and October 1. In addition, the Company is subject to an unused commitment fee. Interest expense for the Revolving Credit Facility was $631 and $644 for the three months ended June 30, 2026 and 2025, respectively, and $1,098 and $1,313 for the six months ended June 30, 2026 and 2025, respectively. As of June 30, 2026, the Company was in compliance with all required covenants and had an available borrowing capacity of $114,000. 23 HCI GROUP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (unaudited) (In thousands, except share and per share amounts, unless otherwise stated) Note 9 -- Long-Term Debt The following table summarizes long-term debt: Interest Payment June 30, December 31, Debt Description Issued Maturity Rate Date 2026 2025 4.55% Promissory Note 7/6/2018 8/1/2036 4.55% Monthly $ 3,973 $ 4,125 5.50% Promissory Note 6/26/2023 7/1/2033 5.50% Monthly 11,292 11,422 5.65% Promissory Note 7/24/2025 8/1/2035 5.65% Monthly 16,736 16,896 Total principal amount 32,001 32,443 Less: unamortized issuance costs (536 ) (566 ) Long-term debt $ 31,465 $ 31,877 There were no significant changes in the Company’s long-term debt during the six months ended June 30, 2026. During the six months ended June 30, 2025, the Company converted $172,500 in aggregate principal of its 4.75% convertible senior notes into consideration of 2,187,063 shares of the Company’s common stock and $1,133 in cash. The cash consideration included an inducement payment of $1,125 and $8 paid in lieu of fractional shares. The Company recognized an expense related to the inducement payment of $1,125 in other operating expenses on the consolidated statements of income and as financing cash flows on the consolidated statements of cash flows. Interest expense for long-term debt was $453 and $3,100 for the three months ended June 30, 2026 and 2025, respectively, and $909 and $5,815 for the six months ended June 30, 2026 and 2025, respectively. Note 10 -- Reinsurance Reinsurance obtained from other insurance companies In the normal course of business, the Company seeks to reduce the loss that may arise from catastrophes or other events by reinsuring certain levels of risk in various areas of exposure with other insurance enterprises or reinsurers. The Company contracts with a number of reinsurers to secure its annual reinsurance coverage, which generally becomes effective June 1st of each year. The Company purchases reinsurance each year taking into consideration its overall insurance exposure, modeled probable maximum losses, risk tolerance and retention levels, mandatory reinsurance coverage provided by the Florida Hurricane Catastrophe Fund (a tax-exempt state trust fund), and overall reinsurance market conditions. Amounts recoverable from reinsurers are estimated in a manner consistent with the applicable reinsurance contract or contracts. Premiums ceded to other companies have been reported as a reduction of gross premiums earned to arrive at net premiums earned. Prepaid reinsurance premiums represent the unexpired portion of premiums ceded to reinsurers. Reinsurance contracts that do not transfer insurance risk are accounted for using the deposit method. Under the deposit method, amounts paid, less any retained fees, are recorded as deposits within other assets in the consolidated balance sheets and within financing activities in the consolidated statements of cash flows. The Company remains liable for claims payments in the event any reinsurer is unable to meet its obligations under the reinsurance agreements. Failure of reinsurers to honor their obligations could result in losses to the Company. The Company evaluates the financial condition of its reinsurers and monitors concentrations of credit risk arising from similar geographic regions, activities or economic characteristics of the reinsurers to minimize its exposure to significant losses from reinsurer insolvencies. 24 HCI GROUP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (unaudited) (In thousands, except share and per share amounts, unless otherwise stated) The impact of the reinsurance contracts on premiums written and earned is as follows: Three Months Ended Six Months Ended June 30, June 30, 2026 2025 2026 2025 Premiums Written: Direct $ 383,351 $ 357,336 $ 665,355 $ 625,792 Assumed (1,006 ) (791 ) (2,318 ) 19,999 Gross written 382,345 356,545 663,037 645,791 Ceded (101,812 ) (102,522 ) (205,867 ) (202,157 ) Net premiums written $ 280,533 $ 254,023 $ 457,170 $ 443,634 Premiums Earned: Direct $ 294,540 $ 270,232 $ 580,449 $ 519,634 Assumed 26,284 32,396 66,581 83,377 Gross earned 320,824 302,628 647,030 603,011 Ceded (101,812 ) (102,522 ) (205,867 ) (202,157 ) Net premiums earned $ 219,012 $ 200,106 $ 441,163 $ 400,854 As of June 30, 2026 and December 31, 2025, net amounts recoverable from reinsurers were $255,744 and $289,896, respectively. There were no ceded losses from catastrophic events or significant adjustment to ceded losses from prior periods during the three and six months ended June 30, 2026. During the three and six months ended June 30, 2025, the Company derecognized ceded losses of $61,200 related to a favorable change in estimated losses from Hurricane Milton. As of June 30, 2026 and December 31, 2025, there were over 40 reinsurers participating in the Company’s reinsurance program. As of June 30, 2026, approximately 75.5% of the reinsurance recoverable balance was receivable from six reinsurers, one of which was the Florida Hurricane Catastrophe Fund. The allowance for credit losses related to reinsurance recoverable was not material to the consolidated balance sheets or consolidated statements of income for the periods presented. Under contracts in effect prior to June 1, 2025, reinsurance costs could be adjusted by retrospective provisions under reinsurance contracts. There were no adjustments to premiums ceded related to retrospective provisions for the three and six months ended June 30, 2026 and 2025. Reinsurance provided to other insurance companies United Property & Casualty Insurance Company The Company formerly provided quota share reinsurance to United Property & Casualty Insurance Company (“United”) on its policies in the northeast and southeast regions of the U.S. United was placed into receivership by the State of Florida due to its financial insolvency. As a result, the Company ceased providing quota share reinsurance on United policies, together with other administrative services, in March 2023. The liabilities and obligations under this quota-share reinsurance agreement were not material as of June 30, 2026 and December 31, 2025. Additionally, the balance of funds withheld for assumed business, which represent net amounts owed to 25 HCI GROUP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (unaudited) (In thousands, except share and per share amounts, unless otherwise stated) the Company related to the Company’s quota share reinsurance agreements with United, were not material as of June 30, 2026 and December 31, 2025. Citizens Property Insurance Corporation The Company may participate in a “take-out program” through which the Company assumes insurance policies held by Citizens Property Insurance Corporation (“Citizens”), a Florida state-supported insurer. The take-out program is a legislatively mandated program designed to reduce the state’s risk exposure by encouraging private companies to assume policies from Citizens. The table below shows the number of policies (in actuals) and annualized gross premiums assumed from Citizens during the periods presented: Three Months Ended Six Months Ended June 30, June 30, 2026 2025 2026 2025 Policies Assumed — — — 13,917 Annualized Gross Premiums $ — $ — $ — $ 35,820 Note 11 -- Losses and Loss Adjustment Expenses The Company accrues for losses and loss adjustment expenses (“LAE”) in the period in which the underlying loss event occurred. LAE are costs associated with the investigation, evaluation, adjustment, and settlement of insurance claims and can be either allocated, costs directly attributable to a specific claim, or unallocated, costs that cannot be directly attributed to a specific claim. Reserves for losses and LAE are determined by establishing liabilities in amounts estimated to cover incurred losses and LAE. Such reserves are determined based on the assessment of claims reported and the development of pending claims. These reserves are based on individual case estimates for reported losses and LAE and estimates of amounts incurred but not reported. The estimates of unpaid losses and LAE are subject to trends in claim severity and frequency and are continually reviewed. As part of the process, the Company reviews historical data and considers various factors, including known and anticipated regulatory and legal developments, changes in social attitudes, inflation, and economic conditions. As experience develops and other data becomes available, these estimates are revised, as required, resulting in increases or decreases to the existing unpaid losses and LAE. Adjustments are reflected in the results of operations in the period in which they are made and the liabilities may deviate substantially from prior estimates. Losses and LAE ceded to or recovered from reinsurers are recorded as a reduction to losses and LAE on the consolidated statements of income. Accordingly, losses and LAE in the consolidated statements of income are net of reinsurance. 26 HCI GROUP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (unaudited) (In thousands, except share and per share amounts, unless otherwise stated) Activity in the liability for losses and LAE is summarized as follows: Three Months Ended Six Months Ended June 30, June 30, 2026 2025 2026 2025 Net balance, beginning of period (a) $ 319,992 $ 316,561 $ 314,357 $ 323,335 Incurred, net of reinsurance, related to: Current period 71,076 64,457 136,676 123,748 Prior periods — — — — Total incurred, net of reinsurance 71,076 64,457 136,676 123,748 Paid, net of reinsurance, related to: Current period (34,880 ) (23,057 ) (53,308 ) (36,152 ) Prior periods (26,410 ) (36,404 ) (67,947 ) (89,374 ) Total paid, net of reinsurance (61,290 ) (59,461 ) (121,255 ) (125,526 ) Net balance, end of period 329,778 321,557 329,778 321,557 Add: reinsurance recoverable before allowance for credit losses 229,204 375,335 229,204 375,335 Gross balance, end of period $ 558,982 $ 696,892 $ 558,982 $ 696,892 (a)Net balance represents beginning-of-period liability for unpaid losses and LAE less beginning-of-period reinsurance recoverable for unpaid losses and LAE. Incurred losses and LAE increased for the three and six months ended June 30, 2026 compared to the three and six months ended June 30, 2025 primarily due to a higher volume of policies in force. There were no losses from catastrophic events during the three and six months ended June 30, 2026 and 2025. Note 12 -- Variable Interest Entities The Company includes two consolidated VIEs related to reciprocal insurance exchanges, CORE and Tailrow. The reciprocal insurance exchanges are owned by their policyholders, referred to as subscribers, who gain ownership by buying an insurance policy and making a surplus contribution. Each subscriber has rights in their respective reciprocal insurance exchange to (i) receive dividends or premium credits if the reciprocal insurance exchange generates a surplus, and (ii) elect members to the subscribers’ advisory committee. The subscribers’ advisory committee oversees the financial affairs of its respective reciprocal insurance exchange and appoints the AIF. Each subscribers’ advisory committee requires at least two-thirds of its members to be subscribers who are independent of the AIF. 27 HCI GROUP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (unaudited) (In thousands, except share and per share amounts, unless otherwise stated) Both CORE and Tailrow each received initial funding through the issuance of a subordinated surplus note to the Company as neither had any subscribers nor sufficient surplus to fund their insurance operations at the time of formation. In addition, CORE and Tailrow each entered into an AIF agreement with Core Risk Managers, LLC (“CRM”) and Tailrow Risk Managers, LLC (“TRM”), respectively. Both CRM and TRM are wholly-owned subsidiaries of HCI Group, Inc. The AIF agreements, which were approved by the Florida Office of Insurance Regulation (“FLOIR”), can be terminated at any time by mutual agreement of both parties or with cause, if the FLOIR or a court of competent jurisdiction determines a material breach of the agreement has occurred. Under the AIF agreements, CRM and TRM have the power of attorney to directly or indirectly conduct the daily operations of CORE and Tailrow, respectively, by underwriting insurance policies, collecting premiums, investing funds, and processing claims. As such, subscribers do not possess the power to directly manage the operations of CORE and Tailrow. The AIF agreements also permit CRM and TRM to contract with service providers, including other HCI Group, Inc. subsidiaries, to perform certain functions. The AIF agreements, together with the subordinated surplus notes, result in both CORE and Tailrow to be consolidated VIEs. As CORE and Tailrow are owned by their underlying policyholders, their net assets and results of operations are included in noncontrolling interests. CORE CORE was formed and issued a $25,000 subordinated surplus note with an annual interest rate of 9% during 2023. CORE commenced business operations during 2024. As of June 30, 2026 and December 31, 2025, the Company’s maximum exposure to loss relating to CORE was $25,000. CORE’s assets are legally restricted for the purpose of fulfilling obligations specific to CORE and its creditors have no legal right to pursue additional sources of payment from the Company. Tailrow Tailrow was formed and issued a $25,000 subordinated surplus note with an annual interest rate of 9% during 2024. Tailrow commenced business operations during 2025. As of June 30, 2026 and December 31, 2025, the Company’s maximum exposure to loss relating to Tailrow was $25,000. Tailrow’s assets are legally restricted for the purpose of fulfilling obligations specific to Tailrow and its creditors have no legal right to pursue additional sources of payment from the Company. 28 HCI GROUP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (unaudited) (In thousands, except share and per share amounts, unless otherwise stated) The following table summarizes the assets and liabilities related to the Company’s variable interests in consolidated VIEs which are included in the accompanying consolidated balance sheets: June 30, December 31, 2026 2025 Assets Fixed-maturity securities, available-for-sale, at fair value (amortized cost: $33,637 and $0, respectively, and allowance for credit losses: $0 and $0, respectively) $ 33,621 $ — Total investments 33,621 — Cash and cash equivalents 158,345 154,156 Restricted cash 642 636 Income taxes receivable 1,277 1,332 Deferred income tax assets, net 1,088 2,237 Premiums receivable, net (allowance: $1,558 and $1,406, respectively) 8,414 4,549 Prepaid reinsurance premium — 2,499 Reinsurance recoverable, net of allowance for credit losses: Paid losses and loss adjustment expenses (allowance: $0 and $0, respectively) 748 26 Unpaid losses and loss adjustment expenses (allowance: $0 and $1, respectively) 852 1,573 Deferred policy acquisition costs 7,493 4,464 Other assets 1,445 539 Total assets $ 247,546 $ 172,011 Liabilities Losses and loss adjustment expenses $ 30,825 $ 24,810 Unearned premiums 71,998 73,086 Advance premiums 5,613 1,817 Ceded reinsurance premiums payable 5,173 933 Assumed premiums payable 1,841 837 Income taxes payable 1,211 2,857 Deferred income tax liabilities, net — 127 Accrued expenses and other liabilities 3,809 2,162 Total liabilities $ 120,470 $ 106,629 29 HCI GROUP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (unaudited) (In thousands, except share and per share amounts, unless otherwise stated) Note 13 -- Segment Information The Company has five reportable segments: Insurance Operations, Exzeo, Reciprocal Exchange Operations, Real Estate, and Corporate and Other. Due to their economic characteristics, the Company’s property and casualty insurance and reinsurance operations, excluding the insurance operations under Reciprocal Exchange Operations, are grouped together into one reportable segment under Insurance Operations. The Exzeo segment represents Exzeo’s operations related to insurance technology and operations solutions for property and casualty insurance carriers. The Reciprocal Exchange Operations segment represents the insurance operations of consolidated reciprocal insurance exchanges owned by their policyholders. The Real Estate segment represents the operations of the Company’s commercial real estate group primarily engaged in developing and operating commercial properties for investment purposes or internal use. The Corporate and Other segment represents the activities of the holding companies and any other operations that do not meet the quantitative and qualitative thresholds for a reportable segment. The Company’s segments are based on the manner in which the Company’s Chief Executive Officer, who is the chief operating decision maker (the “CODM”), evaluates performance and makes decisions regarding the allocation of resources. The CODM evaluates performance and allocates resources using various measures primarily through reviews of various operational performance packages, investor presentations, and the Company’s SEC filings, as well as through the approval of the Company’s annual budget and forecast. The Company’s reported segment profit measure is income (loss) before income taxes as this measure is most consistent with the amounts included in the consolidated statements of income. Intersegment transactions are not eliminated from segment results while intrasegment transactions are eliminated from segment results. The accounting policies of the Company’s reportable segments are the same as those of the Company, except as otherwise noted. The determination of segments may change over time due to changes in operational emphasis, revenue, and results of operations. 30 HCI GROUP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (unaudited) (In thousands, except share and per share amounts, unless otherwise stated) The following tables present segment information reconciled to the Company’s consolidated statements of income for the periods presented: For Three Months Ended June 30, 2026 Insurance Operations Exzeo Reciprocal Exchange Operations Real Estate (a) Corporate/ Other (b) Reclassification/ Elimination Consolidated Revenue Gross premiums earned (c) $ 287,180 $ — $ 35,618 $ — $ — $ (1,974 ) $ 320,824 Premiums ceded (92,104 ) — (11,682 ) — — 1,974 (101,812 ) Net premiums earned 195,076 — 23,936 — — — 219,012 Net income from investment portfolio 15,792 2,963 1,534 — 1,614 (1,048 ) 20,855 Policy fee income 1,487 — — — 300 (136 ) 1,651 Other 4,344 57,787 (110 ) 4,567 5,630 (67,083 ) 5,135 Total revenue 216,699 60,750 25,360 4,567 7,544 (68,267 ) 246,653 Expenses Losses and loss adjustment expenses 84,697 — 9,308 — — (22,929 ) 71,076 Amortization of deferred policy acquisition costs 27,780 — 2,664 — — — 30,444 Other policy acquisition expenses 15,557 10,039 4,517 — 3,228 (31,439 ) 1,902 Stock-based compensation expense 666 760 — — 1,913 — 3,339 Interest expense — — 1,122 453 631 (1,122 ) 1,084 Depreciation and amortization 283 736 — 848 147 (708 ) 1,306 Personnel and other operating expenses 12,091 17,789 232 3,177 5,308 (12,068 ) 26,529 Total expenses 141,074 29,324 17,843 4,478 11,227 (68,266 ) 135,680 Income (loss) before income taxes (d) $ 75,625 $ 31,426 $ 7,517 $ 89 $ (3,683 ) $ (1 ) $ 110,973 Total revenue from non-affiliates (e) $ 211,919 $ 6,533 $ 27,334 $ 3,703 $ 1,089 Gross premiums written $ 338,686 $ — $ 43,659 (a)Other revenue under Real Estate primarily consisted of rental income from investment properties. (b)Other revenue under Corporate and Other primarily consisted of management fees for AIF services. (c)Gross premiums earned under Insurance Operations included $1,974 earned from Reciprocal Exchange Operations. (d)The income (loss) before income taxes in the reclassification/elimination column is attributable to intercompany transactions among operating segments. The Insurance Operations and the Reciprocal Exchange Operations record service fee expenses based on earned premiums or other appropriate measures, while Exzeo and the AIF operations recognize service fee revenue according to revenue recognition standards. Although both service fee expenses and revenue are fully eliminated on consolidation, they do not completely offset each other in this presentation due to the different methods of recognition. (e)Represents amounts before reclassification of certain revenue and expenses to conform with an insurance company’s presentation. 31 HCI GROUP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (unaudited) (In thousands, except share and per share amounts, unless otherwise stated) For Three Months Ended June 30, 2025 Insurance Operations Exzeo Reciprocal Exchange Operations Real Estate (a) Corporate/ Other (b) Reclassification/ Elimination Consolidated Revenue Gross premiums earned (c) $ 282,269 $ — $ 21,639 $ — $ — $ (1,280 ) $ 302,628 Premiums ceded (95,017 ) — (8,785 ) — — 1,280 (102,522 ) Net premiums earned 187,252 — 12,854 — — — 200,106 Net income from investment portfolio 14,583 763 974 — 2,129 (669 ) 17,780 Policy fee income 302 — — — 5 1,160 1,467 Other 3,602 56,091 4 3,493 2,548 (63,171 ) 2,567 Total revenue 205,739 56,854 13,832 3,493 4,682 (62,680 ) 221,920 Expenses Losses and loss adjustment expenses 82,365 — 4,842 — — (22,750 ) 64,457 Amortization of deferred policy acquisition costs 27,027 — 1,415 — — — 28,442 Other policy acquisition expenses 15,268 10,074 2,836 — 1,339 (27,408 ) 2,109 Stock-based compensation expense 325 706 — — 1,664 — 2,695 Interest expense — — 1,124 215 3,529 (1,124 ) 3,744 Depreciation and amortization 611 731 — 640 194 (505 ) 1,671 Personnel and other operating expenses 12,071 16,454 808 2,064 5,443 (12,430 ) 24,410 Total expenses 137,667 27,965 11,025 2,919 12,169 (64,217 ) 127,528 Income (loss) before income taxes (d) $ 68,072 $ 28,889 $ 2,807 $ 574 $ (7,487 ) $ 1,537 $ 94,392 Total revenue from non-affiliates (e) $ 201,670 $ 2,513 $ 15,112 $ 2,629 $ 1,327 Gross premiums written $ 337,502 $ — $ 19,043 (a)Other revenue under Real Estate primarily consisted of rental income from investment properties. (b)Other revenue under Corporate and Other primarily consisted of management fees for AIF services. (c)Gross premiums earned under Insurance Operations included $1,280 earned from Reciprocal Exchange Operations. (d)The income (loss) before income taxes in the reclassification/elimination column is attributable to intercompany transactions among operating segments. The Insurance Operations and the Reciprocal Exchange Operations record service fee expenses based on earned premiums or other appropriate measures, while Exzeo and the AIF operations recognize service fee revenue according to revenue recognition standards. Although both service fee expenses and revenue are fully eliminated on consolidation, they do not completely offset each other in this presentation due to the different methods of recognition. (e)Represents amounts before reclassification of certain revenue and expenses to conform with an insurance company’s presentation. 32 HCI GROUP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (unaudited) (In thousands, except share and per share amounts, unless otherwise stated) For Six Months Ended June 30, 2026 Insurance Operations Exzeo Group Reciprocal Exchange Operations Real Estate (a) Corporate/ Other (b) Reclassification/ Elimination Consolidated Revenue Gross premiums earned (c) $ 578,331 $ — $ 72,075 $ — $ — $ (3,376 ) $ 647,030 Premiums ceded (188,624 ) — (20,619 ) — — 3,376 (205,867 ) Net premiums earned 389,707 — 51,456 — — — 441,163 Net income from investment portfolio 27,727 5,475 2,801 — 2,692 (1,703 ) 36,992 Policy fee income 2,952 — — — 695 (420 ) 3,227 Other 8,183 113,320 (378 ) 8,763 10,814 (132,549 ) 8,153 Total revenue 428,569 118,795 53,879 8,763 14,201 (134,672 ) 489,535 Expenses Losses and loss adjustment expenses 158,259 — 18,236 — — (39,819 ) 136,676 Amortization of deferred policy acquisition costs 55,619 — 4,714 — — — 60,333 Other policy acquisition expenses 34,481 22,212 9,161 — 6,074 (68,145 ) 3,783 Stock-based compensation expense 1,346 1,499 — — 3,853 — 6,698 Interest expense — — 2,232 909 1,098 (2,232 ) 2,007 Depreciation and amortization 704 1,466 — 1,705 310 (1,430 ) 2,755 Personnel and other operating expenses 22,896 34,605 544 5,692 10,248 (23,059 ) 50,926 Total expenses 273,305 59,782 34,887 8,306 21,583 (134,685 ) 263,178 Income (loss) before income taxes (d) $ 155,264 $ 59,013 $ 18,992 $ 457 $ (7,382 ) $ 13 $ 226,357 Total revenue from non-affiliates (e) $ 419,339 $ 11,257 $ 57,255 $ 7,034 $ 1,621 Gross premiums written $ 592,050 $ — $ 70,987 (a)Other revenue under Real Estate primarily consisted of rental income from investment properties. (b)Other revenue under Corporate and Other primarily consisted of management fees for AIF services. (c)Gross premiums earned under Insurance Operations included $3,376 earned from Reciprocal Exchange Operations. (d)The income (loss) before income taxes in the reclassification/elimination column is attributable to intercompany transactions among operating segments. The Insurance Operations and the Reciprocal Exchange Operations record service fee expenses based on earned premiums or other appropriate measures, while Exzeo and the AIF operations recognize service fee revenue according to revenue recognition standards. Although both service fee expenses and revenue are fully eliminated on consolidation, they do not completely offset each other in this presentation due to the different methods of recognition. (e)Represents amounts before reclassification of certain revenue and expenses to conform with an insurance company’s presentation. 33 HCI GROUP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (unaudited) (In thousands, except share and per share amounts, unless otherwise stated) For Six Months Ended June 30, 2025 Insurance Operations Exzeo Group Reciprocal Exchange Operations Real Estate (a) Corporate/ Other (b) Reclassification/ Elimination Consolidated Revenue Gross premiums earned (c) $ 564,404 $ — $ 41,086 $ — $ — $ (2,479 ) $ 603,011 Premiums ceded (188,444 ) — (16,192 ) — — 2,479 (202,157 ) Net premiums earned 375,960 — 24,894 — — — 400,854 Net income from investment portfolio 25,442 1,161 1,754 — 3,894 (1,459 ) 30,792 Policy fee income 2,531 — — — 5 1,160 3,696 Other 6,348 108,498 (5 ) 6,333 6,203 (124,366 ) 3,011 Total revenue 410,281 109,659 26,643 6,333 10,102 (124,665 ) 438,353 Expenses Losses and loss adjustment expenses 153,180 — 7,614 — — (37,046 ) 123,748 Amortization of deferred policy acquisition costs 52,271 — 2,482 — — — 54,753 Other policy acquisition expenses 33,601 22,741 5,357 — 3,467 (62,081 ) 3,085 Stock-based compensation expense 798 1,429 — — 3,440 — 5,667 Interest expense — — 2,232 431 6,697 (2,232 ) 7,128 Depreciation and amortization 1,222 1,439 — 1,150 385 (879 ) 3,317 Personnel and other operating expenses 23,315 30,966 1,063 3,797 9,598 (22,815 ) 45,924 Total expenses 264,387 56,575 18,748 5,378 23,587 (125,053 ) 243,622 Income (loss) before income taxes (d) $ 145,894 $ 53,084 $ 7,895 $ 955 $ (13,485 ) $ 388 $ 194,731 Total revenue from non-affiliates (e) $ 402,720 $ 2,911 $ 29,122 $ 4,604 $ 2,165 Gross premiums written $ 597,031 $ — $ 48,760 (a)Other revenue under Real Estate primarily consisted of rental income from investment properties. (b)Other revenue under Corporate and Other primarily consisted of management fees for AIF services. (c)Gross premiums earned under Insurance Operations included $2,479 earned from Reciprocal Exchange Operations. (d)The income (loss) before income taxes in the reclassification/elimination column is attributable to intercompany transactions among operating segments. The Insurance Operations and the Reciprocal Exchange Operations record service fee expenses based on earned premiums or other appropriate measures, while Exzeo and the AIF operations recognize service fee revenue according to revenue recognition standards. Although both service fee expenses and revenue are fully eliminated on consolidation, they do not completely offset each other in this presentation due to the different methods of recognition. (e)Represents amounts before reclassification of certain revenue and expenses to conform with an insurance company’s presentation. 34 HCI GROUP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (unaudited) (In thousands, except share and per share amounts, unless otherwise stated) The following table presents gross premium earned by geographic location: Three Months Ended Six Months Ended June 30, June 30, 2026 2025 2026 2025 Florida $ 291,943 $ 272,473 $ 589,042 $ 543,278 Non-Florida 28,881 30,155 57,988 59,733 Gross premiums earned $ 320,824 $ 302,628 $ 647,030 $ 603,011 The following table presents segment assets reconciled to the Company’s total assets on the consolidated balance sheets: June 30, December 31, 2026 2025 Segments Insurance Operations $ 2,050,786 $ 1,895,081 Exzeo 385,783 347,734 Reciprocal Exchange Operations 224,134 184,453 Real Estate 137,465 130,971 Corporate and Other 122,020 120,686 Consolidation and Elimination (271,729 ) (149,997 ) Total assets $ 2,648,459 $ 2,528,928 As of June 30, 2026 and December 31, 2025, substantially all of the Company’s assets were located in Florida. 35 HCI GROUP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (unaudited) (In thousands, except share and per share amounts, unless otherwise stated) Note 14 -- Income Taxes There were no significant changes in the Company’s valuation allowance on deferred income tax assets during the three and six months ended June 30, 2026. During the three months ended June 30, 2026 and 2025, the Company recorded income tax expense of $28,073 and $24,113, respectively, resulting in effective tax rates of 25.3% and 25.5%, respectively. Each rate represented the federal statutory tax rate of 21.0%, state taxes (net of federal benefits), and unfavorable non-deductible compensation expenses. During the six months ended June 30, 2026 and 2025, the Company recorded income tax expense of $58,414 and $50,222, respectively, resulting in an effective tax rate of 25.8% for each period. Each rate represented the federal statutory tax rate of 21.0%, state taxes (net of federal benefits), and unfavorable non-deductible compensation expenses. Note 15 -- Earnings Per Share The Company applies the two-class method for computing and presenting earnings per share since the Company’s unvested restricted stock awards represent participating securities due to the right to share in dividends, if declared, equally with common stockholders. The two-class method allocates current period net income to common stock and participating securities based on (i) dividends declared and (ii) participation rights in the remaining undistributed income. For a majority-owned subsidiary, the Company’s proportionate share in that majority-owned subsidiary’s earnings per share is added to the computation of earnings per share on a consolidated basis. Basic earnings per share is computed by dividing income attributable to common stockholders using the two-class method by the weighted-average number of shares of common stock outstanding during the period. Diluted earnings per share gives effect to all securities having a dilutive effect on income attributable to common stockholders, weighted-average shares of common stock outstanding, or both. The effect from dilutive securities included, but was not limited to: (i) incremental shares of common stock calculated using the if-converted method for convertible debt instruments; (ii) incremental shares of common stock calculated using the treasury stock method for warrants and share-based compensation awards; (iii) adjustments to a majority-owned subsidiary's earnings per share due to its dilutive securities; and (iv) the corresponding impact to income attributable to common stockholders associated with the preceding considerations. Net losses are not allocated to participating securities as the participating securities do not have a contractual obligation to share in losses. 36 HCI GROUP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (unaudited) (In thousands, except share and per share amounts, unless otherwise stated) The computations of basic and diluted earnings per share for the periods presented were as follows: Three Months Ended Three Months Ended June 30, 2026 June 30, 2025 Income Shares (a) Per Share Income Shares (a) Per Share (Numerator) (Denominator) Amount (Numerator) (Denominator) Amount Net income $ 82,900 $ 70,279 Less: Net income attributable to noncontrolling interests (9,103 ) (4,119 ) Net income after noncontrolling interests 73,797 66,160 Less: Income attributable to participating securities (2,925 ) (2,616 ) Basic Earnings Per Share: Income attributable to common stockholders 70,872 12,269 $ 5.78 63,544 11,400 $ 5.57 Effect of Dilutive Securities: Stock options — 382 — 392 Convertible senior notes — — 3,170 1,084 Warrants — 7 — 7 Net impact from reallocation of undistributed earnings to participating securities 65 — — — Diluted Earnings Per Share: Income attributable to common stockholders $ 70,937 12,658 $ 5.60 $ 66,714 12,883 $ 5.18 (a)Shares in thousands. 37 HCI GROUP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (unaudited) (In thousands, except share and per share amounts, unless otherwise stated) Six Months Ended Six Months Ended June 30, 2026 June 30, 2025 Income Shares (a) Per Share Income Shares (a) Per Share (Numerator) (Denominator) Amount (Numerator) (Denominator) Amount Net income $ 167,943 $ 144,509 Less: Net income attributable to noncontrolling interests (20,739 ) (8,665 ) Net income after noncontrolling interests 147,204 135,844 Less: Income attributable to participating securities (6,186 ) (5,691 ) Basic Earnings Per Share: Income attributable to common stockholders 141,018 12,379 $ 11.39 130,153 10,846 $ 12.00 Effect of Dilutive Securities: Stock options — 390 — 373 Convertible senior notes — — 5,500 1,611 Warrants — 7 — 7 Net impact from reallocation of undistributed earnings to participating securities 143 — — — Diluted Earnings Per Share: Income attributable to common stockholders $ 141,161 12,776 $ 11.05 $ 135,653 12,837 $ 10.57 (a)Shares in thousands. For the periods presented, all dilutive securities for Exzeo were excluded from Exzeo's diluted earnings per share computation because their (i) effect would be anti-dilutive, (ii) exercise prices were out-of-the-money, or (iii) contingent exercise conditions were unsatisfied. Note 16 -- Redeemable Noncontrolling Interests Subscriber Surplus Contributions Subscriber surplus contributions in redeemable noncontrolling interests represent a refundable portion of the surplus contributions received from policyholders of CORE and Tailrow. The surplus contributions are reclassified to noncontrolling interests once they are no longer refundable. The following table summarizes the activity of subscriber surplus contributions: Three Months Ended Six Months Ended June 30, June 30, 2026 2025 2026 2025 Beginning balance $ 4,211 $ 1,637 $ 3,359 $ 1,691 Cash contributions 4,215 1,937 6,997 2,770 Return of contributions (74 ) (31 ) (173 ) (34 ) Reclassification of nonrefundable subscriber surplus contributions (2,423 ) (1,138 ) (4,254 ) (2,022 ) Ending balance $ 5,929 $ 2,405 $ 5,929 $ 2,405 38 HCI GROUP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (unaudited) (In thousands, except share and per share amounts, unless otherwise stated) Note 17 -- Equity Stockholders’ Equity Common Stock Each share of common stock entitles the stockholder to one vote. Share Repurchase Program In March 2026, the Company’s Board of Directors authorized a program to repurchase up to $80,000, excluding commissions and other costs, of shares of the Company’s common stock through February 27, 2027 (the “Share Repurchase Program”). The Share Repurchase Program permits the Company to repurchase shares for cash periodically in open market purchases, block transactions, privately negotiated transactions in accordance with applicable federal securities laws, or by other means, including through the use of trading programs intended to qualify under Rule 10b5-1 under the Securities Exchange Act of 1934, as amended, in accordance with applicable securities laws and other restrictions, including Rule 10b-18 under that Act. The Share Repurchase Program does not obligate the Company to repurchase a specific number of shares of common stock, and may be canceled or suspended at any time without notice. During the three and six months ended June 30, 2026, the Company repurchased 363,538 and 473,609 shares of common stock for $56,968 and $74,466, respectively, excluding commissions and other costs, under the Share Repurchase Program. All of the shares repurchased were treated as retirements and reduced the number of shares issued and outstanding. The excess of the purchase price over the par value per share was recorded as a reduction of additional paid-in capital. Commissions and other costs on repurchases of common stock were not material for the three and six months ended June 30, 2026. As of June 30, 2026, the Company may repurchase up to $5,534, excluding commissions and other costs, of shares of its common stock under the Share Repurchase Program. Dividends Stockholders are entitled to receive dividends when, as, and if declared by the Company’s Board of Directors out of funds legally available for that purpose. Unvested restricted stock awards have the right to share in dividends, if declared, equally with common stockholders on a nonforfeitable basis. 39 HCI GROUP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (unaudited) (In thousands, except share and per share amounts, unless otherwise stated) The following table represents the frequency and amount of all cash dividends declared on common stock for the periods presented: Declaration Date Date of Record Payment Date Per Share Amount Six Months Ended June 30, 2026 4/22/2026 5/15/2026 6/18/2026 $ 0.40 1/14/2026 2/20/2026 3/20/2026 $ 0.40 Total $ 0.80 Six Months Ended June 30, 2025 4/23/2025 5/16/2025 6/20/2025 $ 0.40 1/14/2025 2/21/2025 3/21/2025 $ 0.40 Total $ 0.80 Preferred Stock As of June 30, 2026 and December 31, 2025, the Company had 20,000,000 preferred shares authorized, with no shares issued and outstanding. Warrants As of June 30, 2026 and December 31, 2025, there were 11,250 warrants outstanding at an exercise price of $54.40 with an expiration date of December 31, 2028. At-The-Market Facility On January 22, 2024, the Company implemented an “at-the-market” facility (the “ATM Facility”) which gives the Company the ability to raise up to $75,000 through the issuance of new shares of common stock through a sales agent (the “Sales Agent”). The Company has no obligation to sell, and the Sales Agent has no obligation to buy or sell, any shares of common stock under the ATM Facility. As of June 30, 2026 the remaining availability under the ATM Facility was $75,000. Noncontrolling Interests Exzeo As of June 30, 2026, HCI Group, Inc. owned 75,000,000 of the 90,200,252 shares of Exzeo’s outstanding common stock. Of the shares not owned by HCI Group, Inc., 2,541,953 represent unvested restricted stock awards granted to Exzeo's employees. Other adjustments to noncontrolling interests in the consolidated statements of equity primarily relates to (i) the net settlement of Exzeo common shares surrendered by employees to satisfy payroll tax liabilities associated with the vesting of restricted stock awards issued under Exzeo’s stock-based compensation plan and (ii) the change in ownership of Exzeo as a result of the vesting of restricted stock awards issued under Exzeo’s stock-based compensation plan. 40 HCI GROUP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (unaudited) (In thousands, except share and per share amounts, unless otherwise stated) Exzeo Share Repurchase Program In May 2026, Exzeo’s Board of Directors authorized a program to repurchase up to $12,000, excluding commissions and other costs, of shares of Exzeo’s common stock (the “Exzeo Share Repurchase Program”). The Exzeo Share Repurchase Program permits Exzeo to repurchase shares for cash periodically in open market purchases, block transactions, privately negotiated transactions in accordance with applicable federal securities laws, or by other means, including through the use of trading programs intended to qualify under Rule 10b5-1 under the Securities Exchange Act of 1934, as amended, in accordance with applicable securities laws and other restrictions, including Rule 10b-18 under that Act. The Exzeo Share Repurchase Program does not obligate Exzeo to repurchase a specific number of shares of common stock, and may be canceled or suspended at any time without notice. During the three and six months ended June 30, 2026, Exzeo repurchased 726,828 shares of its common stock for $10,029, excluding commissions and other costs, under the Exzeo Share Repurchase Program. All of the shares repurchased were treated as retirements and reduced the number of shares issued and outstanding of Exzeo. Commissions and other costs on repurchases of noncontrolling interests were not material during the three and six months ended June 30, 2026. As of June 30, 2026, Exzeo may repurchase up to $1,971, excluding commissions and other costs, of shares of its common stock under the Exzeo Share Repurchase Program. Subscriber Surplus Contributions Subscriber surplus contributions in noncontrolling interests represent the nonrefundable portion of the surplus contributions received from policyholders of CORE and Tailrow. The surplus contributions are reclassified from redeemable noncontrolling interest once they are no longer refundable. As CORE and Tailrow are owned by their underlying policyholders, their net assets are included in noncontrolling interests. Accumulated Other Comprehensive Income (Loss) Accumulated other comprehensive income (loss) relates to the unrealized gains or losses on available-for-sale fixed-maturity securities carried at fair value, net of income taxes. Accumulated other comprehensive income (loss) is reclassified to either net investment income or net realized investment gains (losses) in the consolidated statements of income as underlying transactions are recognized in earnings. Other comprehensive income (loss) represents the net change in accumulated other comprehensive income (loss). 41 HCI GROUP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (unaudited) (In thousands, except share and per share amounts, unless otherwise stated) The following table summarizes the activity with respect to accumulated other comprehensive income (loss) during the three and six months ended June 30, 2026 and 2025: Before Tax Income Tax Effect Total Noncontrolling Interests Accumulated Other Comprehensive (Loss) Balance as of March 31, 2026 $ (6,127 ) $ (1,534 ) $ (4,593 ) $ (55 ) $ (4,538 ) Net unrealized losses (6,596 ) (1,652 ) (4,944 ) (110 ) (4,834 ) Reclassification to net investment income (16 ) (4 ) (12 ) — (12 ) Reclassification to net realized investment gains 2 — 2 — 2 Balance as of June 30, 2026 $ (12,737 ) $ (3,190 ) $ (9,547 ) $ (165 ) $ (9,382 ) Before Tax Income Tax Effect Total Noncontrolling Interests Accumulated Other Comprehensive Income Balance as of March 31, 2025 $ 1,790 $ 448 $ 1,342 $ — $ 1,342 Net unrealized losses (232 ) (58 ) (174 ) — (174 ) Reclassification to net realized investment gains (14 ) (4 ) (10 ) — (10 ) Balance as of June 30, 2025 $ 1,544 $ 386 $ 1,158 $ — $ 1,158 Before Tax Income Tax Effect Total Noncontrolling Interests Accumulated Other Comprehensive Income (Loss) Balance as of December 31, 2025 $ 1,946 $ 487 $ 1,459 $ — $ 1,459 Net unrealized losses (14,794 ) (3,705 ) (11,089 ) (165 ) (10,924 ) Reclassification to net investment income 158 40 118 — 118 Reclassification to net realized investment gains (47 ) (12 ) (35 ) — (35 ) Balance as of June 30, 2026 $ (12,737 ) $ (3,190 ) $ (9,547 ) $ (165 ) $ (9,382 ) Before Tax Income Tax Effect Total Noncontrolling Interests Accumulated Other Comprehensive (Loss) Income Balance as of December 31, 2024 $ (999 ) $ (250 ) $ (749 ) $ — $ (749 ) Net unrealized gains 2,577 645 1,932 — 1,932 Reclassification to net realized investment gains (34 ) (9 ) (25 ) — (25 ) Balance as of June 30, 2025 $ 1,544 $ 386 $ 1,158 $ — $ 1,158 42 HCI GROUP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (unaudited) (In thousands, except share and per share amounts, unless otherwise stated) Note 18 -- Stock-Based Compensation The Company grants stock-based awards to participants under HCI Group, Inc.’s 2012 Omnibus Incentive Plan (“HCI Plan”) and Exzeo Group, Inc.’s 2025 Omnibus Incentive Plan (“Exzeo Plan”). Stock-based compensation expense is included in general and administrative personnel expenses in the consolidated statements of income and consisted of the following for the periods presented: Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Restricted stock awards $ 2,584 $ 1,994 $ 5,207 $ 4,264 Exzeo stock options — 347 — 689 Exzeo restricted stock awards 755 354 1,491 714 Stock-based compensation expense $ 3,339 $ 2,695 $ 6,698 $ 5,667 Stock-based compensation awards are classified as equity and awards related to the Exzeo Plan are included as a component of noncontrolling interests. HCI Plan As of June 30, 2026, there were 641,937 shares available for issuance under the HCI Plan. Stock Options The following table summarizes the activity related to stock options granted under the HCI Plan during the six months ended June 30, 2026: Weighted Weighted Average Average Remaining Aggregate Number of Exercise Contractual Intrinsic Options Price Term Value Outstanding as of December 31, 2025 590,000 $ 51.54 3.9 years $ 82,687 Granted — $ — Exercised (20,000 ) $ 40.00 Forfeited — $ — Outstanding as of June 30, 2026 570,000 $ 51.95 3.5 years $ 70,283 Exercisable as of June 30, 2026 570,000 $ 51.95 3.5 years $ 70,283 As of June 30, 2026, there was no unrecognized compensation expense related to stock options under the HCI Plan. 43 HCI GROUP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (unaudited) (In thousands, except share and per share amounts, unless otherwise stated) Restricted Stock Awards The following table summarizes the activity related to restricted stock awards granted under the HCI Plan during the six months ended June 30, 2026: Number of Weighted Restricted Average Stock Grant Date Awards Fair Value Unvested as of December 31, 2025 494,635 $ 73.31 Granted 3,750 $ 162.12 Vested (202,255 ) $ 34.23 Forfeited (1,386 ) $ 131.96 Unvested as of June 30, 2026 294,744 $ 100.99 In May 2026, there were 193,500 restricted stock awards that vested as a result of meeting the requisite market condition that the price per share exceeded $140 for a period of 30 consecutive trading days in May 2025. As of June 30, 2026, there were 200,000 unvested restricted stock awards granted under the HCI Plan with market conditions. These awards have not met the requisite market condition of the Company’s share price reaching $200 per share for 30 consecutive trading days. As of June 30, 2026, there was $16,089 of unrecognized compensation expense related to unvested restricted stock awards granted under the HCI Plan, which is expected to be recognized over a weighted-average period of 2.0 years. Exzeo Plan Exzeo maintained its 2021 Omnibus Plan under which shares of Exzeo common stock were authorized for issuance as stock-based compensation awards. On November 4, 2025, Exzeo terminated its 2021 Omnibus Plan and adopted the Exzeo Plan, which authorizes the issuance of up to 10,000,000 shares of Exzeo’s common stock. Awards outstanding under the Exzeo 2021 Omnibus Plan continue to be governed by the terms of that plan and are incremental to, and do not count against, the authorized share pool of the Exzeo Plan. As of June 30, 2026, there were 9,768,170 shares available for issuance under the Exzeo Plan. Exzeo Stock Options As of June 30, 2026, there were 6,350,000 Exzeo stock options outstanding with a weighted-average exercise price of $23.00. All of the Exzeo stock options were fully vested, however, 6,000,000 Exzeo stock options were non-exercisable without approval from HCI Group, Inc.’s Board of Directors. Exzeo Restricted Stock Awards As of June 30, 2026, there were 2,541,953 unvested Exzeo restricted stock awards outstanding with a weighted-average grant date fair value of $4.82. There was $10,599 of unrecognized compensation expense related to unvested Exzeo restricted stock awards, which is expected to be recognized over a weighted-average period of 3.8 years. 44 HCI GROUP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (unaudited) (In thousands, except share and per share amounts, unless otherwise stated) Note 19 -- Commitments and Contingencies Litigation and Other Legal Matters The Company is party to litigation and other legal matters arising in the ordinary course of business. The Company is also subject to regulatory and governmental examinations, information requests and subpoenas, inquiries, investigations, and threatened legal actions and proceedings. The Company records accruals for losses that are probable and reasonably estimable. These accruals are based on a variety of factors such as judgment, probability of loss, and opinions of internal and external legal counsel. Legal costs in connection with litigation and other legal matters arising in the ordinary course of business are expensed as incurred. Although the Company cannot predict with certainty the ultimate resolution of the litigation and other legal matters it is party to, the Company does not believe that any known or potential litigation and other legal matters will have a material effect on the Company’s consolidated financial position, results of operations, or cash flows. Rental Income The Company as a lessor leases its commercial and retail properties, boat slips, and docks to non-affiliates at various terms. There were no significant changes in the Company’s minimum rental payments to be received under operating leases during the three and six months ended June 30, 2026. Capital Commitments As described in Note 5 “Investments” under Limited Partnership Investments, the Company is contractually committed to capital contributions for limited partnership investments. As of June 30, 2026, there was an aggregate unfunded balance of $3,791. FIGA Assessments The Company’s insurance subsidiaries, as member insurers, are required to collect and remit the pass-through assessments to Florida Insurance Guaranty Association (“FIGA”) on a quarterly basis. As of June 30, 2026 and December 31, 2025, the FIGA assessments payable by the Company were $3,415 and $2,034, respectively. Note 20 -- Related Party Transactions HCPCI, TTIC, CORE, and Tailrow have reinstatement premium protection reinsurance contracts (“RPP”) with various reinsurers. The purpose of the RPP contracts is to indemnify HCPCI, TTIC, CORE, and Tailrow for the reinstatement premium which HCPCI, TTIC, CORE, and Tailrow pay or become liable to pay under the reinstatement provisions of the respective excess of loss reinsurance contracts. For one of the RPP contracts, Oxbridge Reinsurance Limited (“Oxbridge”) participated as a subscribing reinsurer with HCPCI and Tailrow as collective reinsureds for the 2025 - 2026 treaty year. One of the Company’s non-employee directors, Jay Madhu, serves as Oxbridge’s Chairman of its Board of Directors and Chief Executive Officer and is an investor in that company. For its participation on the RPP contract, Oxbridge’s net annual premium was $930 and was paid by HCPCI and Tailrow over four installments. Management believes the premium rate was competitive with market rates. A trust account has been established with HCPCI and Tailrow as collective beneficiaries and Oxbridge as 45 HCI GROUP, INC. AND SUBSIDIARIES Notes to Consolidated Financial Statements (unaudited) (In thousands, except share and per share amounts, unless otherwise stated) grantor. Each of the four premium installments was deposited into the trust account in order to fully collateralize Oxbridge’s obligations under the RPP contract. Trust assets may be withdrawn by HCPCI and Tailrow to indemnify HCPCI and Tailrow for Oxbridge’s obligations under the provisions of the RPP contract. Total net premiums to Oxbridge were $910 for the 2024-2025 treaty year. During the three and six months ended June 30, 2026, the Company paid Oxbridge $408 in fees for transaction services related to the 2026 - 2027 treaty year. Oxbridge did not participate as a subscribing reinsurer for the 2026 - 2027 treaty year. Note 21 -- Subsequent Events On July 1, 2026, the Company’s Board of Directors declared a quarterly dividend of $0.40 per common share. The dividends are payable on September 18, 2026 to stockholders of record on August 21, 2026. On July 8, 2026, the Company completed the Exzeo Share Repurchase Program with a total 834,250 shares of Exzeo’s common stock repurchased for $12,000, excluding commissions and other costs. On July 17, 2026, the Company completed the Share Repurchase Program with a total 504,330 shares of common stock repurchased for $80,000, excluding commissions and other costs. 46