Related Parties |
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| Related Party Transactions [Abstract] | ||||||||||||||||||||||||||||||||||||
| Related Parties |
RELATED PARTIES Ryan Investment Holdings
Ryan Investment Holdings, LLC (“RIH”) was formed as an investment holding company designed to aggregate the funds
of Ryan Specialty and Geneva Ryan Holdings, LLC (“GRH”) for investment in Geneva Re Partners, LLC (“GRP”). GRH
was formed as an investment holding company designed to aggregate investment funds of Patrick G. Ryan and other
affiliated investors. Two affiliated investors are LLC Unitholders and directors of the Company, and another is an LLC
Unitholder and employee of the Company. Ryan Specialty does not consolidate GRH as the Company does not have a
direct investment in or variable interest in this entity.
The Company holds a 47% interest in RIH and GRH holds a 53% interest in RIH. RIH has a 50% non-controlling interest
in GRP, and the other 50% is owned by Nationwide Mutual Insurance Company. GRP wholly owns Geneva Re, Ltd.
(“Geneva Re”), a Bermuda-regulated reinsurance company, and GR Bermuda SAC Ltd. (the “Segregated Account
Company”). The Segregated Account Company has one segregated account, which is beneficially owned by a third-party
insurance company (the “Third-party Insurer”). RIH is considered a related party variable interest entity under common
control with the Company. The Company is not most closely associated with the variable interest entity and therefore does
not consolidate RIH. The assets of RIH are restricted to settling obligations of RIH, pursuant to Delaware limited liability
company statutes.
The Company is not required to contribute any additional capital to RIH, and its maximum exposure to loss on the equity
method investment is the total invested capital of $47.0 million. The Company may be exposed to losses arising from the
equity method investment as a result of underwriting losses recognized at Geneva Re or losses on Geneva Re’s investment
portfolio. RIH has committed to contribute additional capital to GRP over the next several years. Patrick G. Ryan, through
a trust of which he is the beneficiary and co-trustee, has committed to personally fund any such additional capital
contributions. Any such additional capital contributions under this commitment will not affect the relative ownership of
RIH’s common equity.
The following table summarizes the change in the balance of the Company’s equity method investment in Geneva Re:
Geneva Re
The Company has a service agreement with Geneva Re to provide both administrative services to, as well as disburse
payments for costs directly incurred by, Geneva Re. These direct costs include compensation expenses incurred by
employees of Geneva Re. The Company had $0.3 million and $0.2 million due from Geneva Re under this agreement as of
December 31, 2024 and 2023, respectively.
Ryan Re Services Agreements with Geneva Re
Ryan Re, a wholly owned subsidiary of the Company, is party to a services agreement with Geneva Re to provide, among
other services, certain underwriting and administrative services to Geneva Re. Ryan Re receives a service fee equal to
115% of the administrative costs incurred by Ryan Re in providing these services to Geneva Re. Revenue earned from
Geneva Re was $1.5 million, $1.5 million, and $1.6 million for the years ended December 31, 2024, 2023, and 2022,
respectively. Receivables due from Geneva Re under this agreement were $0.7 million as of December 31, 2024 and 2023.
On April 2, 2023, Ryan Re entered into a services agreement with Geneva Re in accordance with which Ryan Re
subcontracted certain services to Geneva Re that Ryan Re is required to provide to the segregated account of the
Segregated Account Company on behalf of the Third-party Insurer. The Company incurred expense of $10.5 million and
$7.5 million during the years ended December 31, 2024 and 2023, respectively. The Company had prepaid expenses of
$5.2 million and $5.3 million as of December 31, 2024 and 2023, respectively, related to this services agreement. The
prepaid expenses are included in Other currents assets on the Consolidated Balance Sheets.
Company Leasing of Corporate Jets
In the ordinary course of its business, the Company charters executive jets for business purposes from Executive Jet
Management (“EJM”), a third-party service provider. Mr. Ryan indirectly owns aircraft that he leases to EJM for EJM’s
charter operations for which he receives remuneration from EJM. The Company pays market rates for chartering aircraft
through EJM, unless the particular aircraft chartered is Mr. Ryan’s, in which case the Company receives a discount below
market rates. Historically, the Company has been able to charter Mr. Ryan’s aircraft and make use of this discount. The
Company recognized expense related to business usage of the aircraft of $1.2 million, $1.0 million, and $1.3 million for the
years ended December 31, 2024, 2023, and 2022, respectively.
Personal Guarantee
In April 2021, Mr. Ryan personally guaranteed up to $10.0 million of the financial obligations of the Company under an
agency agreement with certain insurance companies that are affiliated with National Indemnity Company. The Company
did not pay Mr. Ryan any consideration for this guarantee. Mr. Ryan’s guarantee may be replaced by the Company with a
letter of credit at any time, subject to the prior approval of the insurance companies. Mr. Ryan will not personally guarantee
any further additional financial obligations of the Company or any of its subsidiaries.
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