Defined Contribution Plan

The Company offers a defined contribution retirement benefit plan, the Ryan Specialty Employee Savings Plan (the “Plan”), to all eligible U.S. employees, based on a minimum number of service hours in a year. Under the Plan, eligible employees may contribute a percentage of their compensation, subject to certain limitations. Further, the Plan authorizes the Company to make a discretionary matching contribution, which has historically equaled 50% of each eligible employee’s contribution. The Company makes discretionary matching contributions throughout the year. The Company recognized expense related to discretionary matching contributions in the amount of $4.2 million and $3.1 million during the three months ended September 30, 2022 and 2021, respectively, and $14.7 million and $10.2 million during the nine months ended September 30, 2022 and 2021, respectively.

Deferred Compensation Plan

The Company offers a non-qualified deferred compensation plan to certain senior employees and members of management. Under this plan, amounts deferred remain assets of the Company and are subject to the claims of the Company’s creditors in the event of insolvency. Changes in value on deferred amounts held are recognized within Compensation and benefits in the Consolidated Statements of Income and Current and Non-current Accrued compensation in the Consolidated Balance Sheets. As of September 30, 2022, $2.0 million and $8.9 million was included in Current Accrued compensation and Non-current Accrued compensation, respectively. As of December 31, 2021, $4.2 million was included in Non-current Accrued compensation in the Consolidated Balance Sheets.

All Risks Long-Term Incentive Plans

The ARL Long-Term Incentive Plans ("LTIP") were fully paid in the third quarter of 2022. Of the expense related to post-combination services, the Company recognized $19.8 million and $27.4 million related to these awards for the nine months ended September 30, 2022 and 2021, respectively. $5.2 million and $9.9 million of expense was recognized during the three months ended September 30, 2022 and 2021, respectively. The related expense was recognized in Compensation and benefits in the Consolidated Statements of Income. The Company made cash payments of $106.7 million and $31.0 million for the nine months ended September 30, 2022 and 2021, respectively. The LTIP accrual was $0 million and $91.0 million as of September 30, 2022 and December 31, 2021, respectively. The liability for these awards was recognized in Current Accrued compensation in the Consolidated Balance Sheets.

Forgivable Notes

Historically the Company offered forgivable notes to certain employees as an incentive, whereby the principal amount of forgivable notes and accrued interest is forgiven by the Company over the term of the notes, so long as the employee continues employment with Ryan Specialty and complies with certain contractual requirements. The aggregate balance of forgivable notes was $25.2 million and $31.2 million as of September 30, 2022 and December 31, 2021, respectively. This balance was included within Current and Non-current Prepaid incentives - net in the Consolidated Balance Sheets. The amortization expense associated with the forgiveness of the principal amount of the notes and accrued interest was recorded within Compensation and benefits in the Consolidated Statements of Income over the related service periods, which is consistent with the term of the notes. The Company recognized expense related to the forgivable notes of $1.5 million and $1.8 million during the three months ended September 30, 2022 and 2021, respectively, and $5.1 million and $5.5 million during the nine months ended September 30, 2022 and 2021, respectively. As of the end of 2020, the Company no longer issues forgivable notes as employee incentives.