TIPTREE INC. – 10-Q – Management's Discussion and Analysis of Financial Condition and Results of Operations

Our Management's Discussion and Analysis of Financial Condition and Results of
Operations is presented in this section as follows:

•Overview

•Results of Operations
•Non-GAAP Measures and Reconciliations
•Liquidity and Capital Resources
•Critical Accounting Policies and Estimates

OVERVIEW

Tiptree allocates capital to select small and middle market companies with the
mission of building long-term value. Established in 2007, we have a significant
track record investing in the insurance sector and across a variety of other
industries, including mortgage origination, specialty finance and shipping. Our
largest operating subsidiary, Fortegra, is a leading provider of specialty
insurance products and related services. We also generate earnings from a
diverse group of select investments that we refer to as Tiptree Capital, which
includes our Mortgage segment and other, non-insurance businesses and assets. We
evaluate performance primarily by the comparison of stockholders' long-term
total return on capital, as measured by growth in stock price plus dividends
paid, in addition to Adjusted Net Income and Adjusted EBITDA.

Our year-to-date 2022 highlights include:

Overall:

•Tiptree reported net income of $14.2 million for the third quarter, up from
$2.0 million in the prior year, driven primarily by the gain on sale of dry bulk
vessels and improved performance in our insurance business.
•Net loss was $9.1 million for the nine months, compared to net income of $38.6
million in 2021, driven by the deferred tax liability associated with the WP
Transaction and unrealized losses on investments as compared to gains in the
prior year, partially offset by improved performance in insurance and shipping
operations.
•Adjusted net income of $48.8 million increased 3.9% from $47.0 million in 2021,
driven by improvement in insurance and shipping operations. Adjusted return on
average equity was 14.2%, as compared to 16.2% in 2021.
•In the quarter, we sold the remaining two dry bulk vessels for $46.2 million,
representing a net gain of $14.1 million. Total proceeds from dry bulk vessel
sales in 2022 were $67.7 million, or a net gain of $21.2 million.
•In the quarter, we signed definitive agreements to sell our two product tankers
for an aggregate of $49.0 million, representing an approximate 44% gain as
compared to the September 30, 2022 book value. The sale of the two tankers is
expected to close in the fourth quarter 2022.
•In June 2022, Tiptree closed the previously announced $200 million investment
in Fortegra, by Warburg. The investment gives Warburg an approximate 24%
ownership in Fortegra on an as converted basis.
•As a result of the WP Transaction, Tiptree recognized a $63.2 million pre-tax
gain in stockholders' equity in the nine months ended September 30, 2022, which
was partially offset by increased deferred tax liabilities resulting from the
tax deconsolidation as Tiptree's ownership of Fortegra was reduced to below 80%.
The deferred tax liability was $38.2 million, with $14.1 million impacting
stockholders' equity directly and $24.1 million impacting net income for the
nine months ended September 30, 2022.

Insurance:

•Gross written premiums and premium equivalents were $1.96 billion for the nine
months ended September 30, 2022, as compared to $1.62 billion for the nine
months ended September 30, 2021, up 20.9% as a result of growth in specialty
insurance lines and fee-based service contract offerings.
•Total revenues increased 25.2% to $903.4 million, from $721.5 million in 2021,
driven by increases in earned premiums, net and service and administrative fees.
•The combined ratio remained consistent at 91.0%, driven by the scalability of
Fortegra's technology and shared service platform, which improved the expense
ratio, while the underwriting ratio increased due to a shift in business mix
toward lines with higher loss ratios and lower expense ratios.
•Income before taxes of $39.1 million decreased by $10.5 million as compared to
$49.6 million in 2021. Return on average equity was 12.1% in 2022 as compared to
17.3% in 2021. The decreases resulted from investment losses in 2022 compared to
gains in 2021, offset by growth in underwriting and fee revenues.
•Adjusted net income increased 29.1% to $59.9 million, as compared to $46.4
million in 2021. Adjusted return on average equity was 25.8%, as compared to
20.9% in 2021.
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•In April 2022, Fortegra acquired ITC Compliance GRP Limited, a provider of
regulatory and compliance services to the retail automotive sector in the United
Kingdom, for net cash consideration of approximately $15.0 million, plus an
earn-out.

Tiptree Capital:
•Maritime transportation income before taxes was $36.5 million in 2022, as
compared to $7.7 million in 2021, driven by a rise in dry bulk and tanker
charter rates and the gain on sale of three dry bulk vessels.
•Mortgage income before taxes was $3.4 million in 2022, as compared to $25.1
million in 2021, with the decrease driven by declines in origination volumes and
gain on sale margins, partially offset by higher servicing fees and positive
fair value adjustments on the mortgage servicing portfolio. Return on average
equity was 5.6% in 2022.

Key Trends:

Our results of operations are affected by a variety of factors including, but
not limited to, general economic conditions and GDP growth, market liquidity and
volatility, consumer confidence, U.S. demographics, employment and wage growth,
business confidence and investment, inflation, interest rates and spreads, the
impact of the regulatory environment, and the other factors set forth in Part I,
Item 1A in our Annual Report on Form 10-K for the fiscal year ended December 31,
2021. Generally, our businesses are positively affected by a healthy U.S.
consumer, stable to gradually rising interest rates, stable markets and business
conditions, and global growth and trade flows. Conversely, rising unemployment,
volatile markets, rapidly rising interest rates, inflation, changing regulatory
requirements and slowing business conditions can have a material adverse effect
on our results of operations or financial condition.

Fortegra generally offers products which have low severity but high frequency
loss experiences and are short duration. In addition, the business has
historically generated significant fee-based revenues. In general, the types of
products Fortegra offers tend to have limited aggregation risk and limited
exposure to catastrophic and residual risk. Underwriting risk is mitigated
through a combination of reinsurance and retrospective commission structures
with agents, distribution partners and/or third-party reinsurers. To mitigate
counterparty risk, Fortegra ensures its distribution partners' captive
reinsurance entities are over-collateralized with highly liquid investments,
primarily cash and cash equivalents. Insurance results primarily depend on
pricing, underwriting, risk retention and the accuracy of reserves, reinsurance
arrangements, returns on invested assets, and policy and contract renewals and
run-off. Factors affecting these items, including conditions in financial
markets, the global economy and the markets in which we operate, fluctuations in
exchange rates, interest rates and inflation, including the current period of
inflationary pressures, may have a material adverse effect on our results of
operations or financial condition. While Fortegra's insurance operations have
historically maintained a relatively stable combined ratio, initiatives to
change the business mix along with these economic factors could generate
different results than the business has historically experienced. In particular,
the current period of rising inflation can have an impact on replacement costs
associated with claims from our customers. To the extent we are unable to pass
the higher costs of claims through higher premiums, lower underwriting margins
could adversely affect our profitability. In addition, the current impact of the
strengthening U.S. dollar relative to other currencies, including the British
pound and Euro, may have a negative impact on book value between periods,
associated with the timing of the recognition of revenues and expenses related
to multi-year insurance contracts.

Fortegra's investment portfolio includes fixed maturity securities, loans,
credit investment funds, and equity securities. Many of those investments are
held at fair value. During the nine months of 2022, the U.S. fixed income
markets have experienced a significant rise in interest rates. Rising interest
rates have and could continue to impact the value of Fortegra's fixed maturity
securities, with any unrealized losses recorded in equity, and if realized,
could impact our results of operations. Offsetting the impact of a rising
interest rate environment, new investments in fixed rate instruments from both
maturities and portfolio growth can result in higher interest income on
investments over time. The weighted average duration of our fixed income
available for sale securities is less than three years. During the nine months
of 2022, 2-year treasury yields increased significantly, which resulted in a
negative impact on Fortegra's fixed income portfolio and our book value, as the
substantial majority was unrealized. While our asset and liability mix is
relatively matched, should we need to liquidate any of these investments before
maturity to pay claims, any realized losses could materially negatively impact
our results of operations.

Changes in fair value for loans, credit investment funds, and equity securities
in Fortegra's investment portfolio are reported quarterly as unrealized gains or
losses in revenues and can be impacted by changes in interest rates, credit
risk, currency risk, or market risk, including specific company or industry
factors. In addition, our equity holdings are relatively concentrated. General
equity market trends, along with company and industry specific factors, can
impact the fair value which can result in unrealized gains and losses affecting
our results.

Rising 10-year treasury yields, and the tapering of the Federal Reserve's
purchases of mortgage-backed securities, has resulted in substantial increases
in mortgage interest rates. Low mortgage interest rates driven by the Federal
Reserve intervention in mortgage markets, and rising home prices in certain
markets, had provided tailwinds to the mortgage markets beginning in the second
quarter of 2020 and through 2021, which had benefited our mortgage operations
and margins. The substantial rise in rates starting in 2022 have resulted in a
sharp reversal of those trends, with volumes and margins declining
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significantly. Only partially offsetting the declines in earnings in our
origination business is an increase in the fair value of our mortgage servicing
portfolio as rising rates slow prepayment speeds, with a resulting increase in
servicing income. Continued rising mortgage rates could have a materially
negative impact on our mortgage business results of operations, and is likely to
be only partially mitigated by the improvement in mortgage servicing revenues. A
sustained period of negative profitability in the mortgage industry could also
impact the availability of funding sources for our mortgage business.

Rising interest rates can also impact the cost of floating interest rate debt
obligations, while declining rates can decrease the cost of debt. Our secured
revolving and term credit agreements, preferred trust securities and asset based
revolving financing are all floating rate obligations. A continuation of rising
rates could have a material impact on our costs of floating rate debt. In
addition, authorities that regulate LIBOR have announced plans to phase out
LIBOR, such that LIBOR is expected to cease to exist as a benchmark for floating
interest rates. Specifically, the ICE Benchmark Administration Limited announced
that all LIBOR settings will either cease to be provided by any administrator or
no longer be representative; (a) immediately after December 31, 2021, in the
case of the 1-week and 2-month U.S. dollar LIBOR settings; and (b) immediately
after June 30, 2023, in the case of the remaining U.S. dollar LIBOR settings.
The Federal Reserve Board and the Federal Reserve Bank of New York organized the
Alternative Reference Rates Committee, which identified the Secured Overnight
Financing Rate (SOFR) as its preferred alternative rate for USD-LIBOR. It is
unclear whether new methods of calculating LIBOR will be established such that
it continues to exist after 2023. Similarly, it is not possible to predict
whether LIBOR will continue to be viewed as an acceptable market benchmark, what
rate or rates may become acceptable alternatives to LIBOR, or what effect these
changes in views or alternatives may have on financial markets for LIBOR-linked
financial instruments. Such uncertainty may result in a sudden or prolonged
increase or decrease in reported LIBOR and/or its replacement rate. To address
the phase out of LIBOR, the agreements for our debt facilities include a
mechanism to replace LIBOR with an alternative reference rate under specified
circumstances, whether that replacement is SOFR or another benchmark. If future
rates based upon the successor reference rate are higher than LIBOR rates due to
illiquidity or other factors, our interest expense could increase.
Common shares of Invesque represent a significant asset on our condensed
consolidated balance sheets, both as part of insurance investments and
separately in Tiptree Capital. Our investment in Invesque, which operates in the
seniors housing, skilled nursing and medical office industries, is carried on
our condensed consolidated balance sheets at fair value. Any additional declines
in the fair value of Invesque's common stock could continue to have a
significant impact on our results of operations and the value of the investment.

The maritime transportation industry is highly competitive and fragmented.
Demand for shipping capacity is a function of global economic conditions and the
related demand for commodities, production and consumption patterns, and is
currently affected by events, such as the war in Ukraine, which interrupt
production, trade routes, and consumption. The shipping industry is cyclical
with significant volatility in charter hire rates and profitability, which can
change rapidly. If rising interest rates and global inflationary factors drive a
global recession, both charter rates and utilization rates could be negatively
impacted.

RESULTS OF OPERATIONS

The following is a summary of our condensed consolidated financial results for
the three and nine months ended September 30, 2022 and 2021. In addition to GAAP
results, management uses the Non-GAAP measures Adjusted net income, Adjusted
return on average equity, Adjusted EBITDA and book value per share as
measurements of operating performance. Management believes these measures
provide supplemental information useful to investors as they are frequently used
by the financial community to analyze financial performance and comparison among
companies. Management uses Adjusted net income and adjusted return on average
equity as part of its capital allocation process and to assess comparative
returns on invested capital. Adjusted EBITDA is also used in determining
incentive compensation for the Company's executive officers. Adjusted net income
represents income before taxes, less provision (benefit) for income taxes, and
excluding the after-tax impact of various expenses that we consider to be unique
and non-recurring in nature, stock-based compensation, net realized and
unrealized gains (losses), and intangibles amortization associated with purchase
accounting. The Company defines Adjusted EBITDA as GAAP net income of the
Company plus corporate interest expense, plus income taxes, plus depreciation
and amortization expense, less the effects of purchase accounting, plus non-cash
fair value adjustments, plus significant non-recurring expenses, and plus
unrealized gains (losses) on available for sale securities that are reported in
other comprehensive income. Adjusted net income, Adjusted return on average
equity and Adjusted EBITDA are not measurements of financial performance or
liquidity under GAAP and should not be considered as an alternative or
substitute for GAAP net income. See "Non-GAAP Reconciliations" for a
reconciliation of these measures to their GAAP equivalents.

Selected Key Metrics
($ in thousands, except per share                  Three Months Ended                      Nine Months Ended
information)                                          September 30,                          September 30,
GAAP:                                            2022               2021                2022                2021
Total revenues                               $ 363,478          $ 286,605          $ 1,028,224          $ 880,980
Net income (loss) attributable to common
stockholders                                 $  14,223          $   2,008          $    (9,145)         $  38,558


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($ in thousands, except per share                 Three Months Ended                   Nine Months Ended
information)                                         September 30,                       September 30,
GAAP:                                           2022              2021              2022              2021
Diluted earnings per share                   $   0.38          $   0.06          $  (0.26)         $   1.11
Cash dividends paid per common share         $   0.04          $   0.04          $   0.12          $   0.12
Return on average equity                         15.4  %            3.3  %           (0.7) %           14.8  %

Non-GAAP: (1)
Adjusted net income                          $ 19,395          $ 20,730          $ 48,833          $ 47,010
Adjusted return on average equity                14.8  %           20.5  %           14.2  %           16.2  %
Adjusted EBITDA                              $  8,904          $ 12,356          $ 49,415          $ 84,594
Book value per share                         $  10.68          $  11.37          $  10.68          $  11.37

(1) See "-Non-GAAP Reconciliations" for a discussion of non-GAAP financial
measures.

Revenues

For the three months ended September 30, 2022, revenues were $363.5 million,
which increased $76.9 million, or 26.8%, compared to the prior year period. For
the nine months ended September 30, 2022, revenues were $1.03 billion, which
increased $147.2 million, or 16.7%, compared to the prior year period. The
changes for both periods were primarily driven by growth in earned premiums,
net, and service and administrative fees in our insurance business, increased
revenues from charter hires of our vessels and our mortgage servicing portfolio,
partially offset by lower mortgage volumes and margins. The nine month
comparison was impacted by net realized and unrealized losses on Invesque and
other investments in 2022 compared to gains in the 2021 period.

The table below provides a break down between net realized and unrealized gains
and losses from Invesque and other investments, which impacted our consolidated
results on a pre-tax basis. Many investments are carried at fair value and
marked to market through unrealized gains and losses. As a result, we expect
earnings related to these investments to be relatively volatile between periods.
Fixed income securities are primarily marked to market through AOCI in
stockholders' equity and do not impact net realized and unrealized gains and
losses until they are sold.

                                                    Three Months Ended                     Nine Months Ended
($ in thousands)                                       September 30,                         September 30,
                                                  2022               2021               2022               2021

Net realized gains - Maritime transportation $ 14,100 $ -

         $   21,217          $      -
Net realized and unrealized gains (losses) -
Invesque                                      $  (1,698)         $ (12,566)         $  (15,624)         $  4,246
Net realized and unrealized gains (losses)(1) $  (6,007)         $  (4,267) 

$ (12,475) $ 9,345

(1) Excludes Invesque and Mortgage realized and unrealized gains and losses.

Net Income (Loss) Attributable to common stockholders

For the three months ended September 30, 2022, net income attributable to common
stockholders was $14.2 million, an increase of $12.2 million, primarily driven
by the sale of our two dry bulk vesselsa and growth in Fortegra's underwriting
and fee operations, partially offset by lower mortgage profitability.

For the nine months ended September 30, 2022, net loss attributable to common
stockholders was $9.1 million, a decrease of $47.7 million from net income of
$38.6 million for the nine months ended September 30, 2021, primarily driven by
net realized and unrealized losses on Invesque and other investments in 2022
compared to gains in 2021, lower mortgage origination revenues and the tax
impacts of the WP Transaction, partially offset by growth in Fortegra's
underwriting and fee operations, increased revenues from our mortgage servicing
portfolio and improvement in dry bulk and tanker charter rates, including the
gain on sale of three dry bulk vessels.

Adjusted net income & Adjusted return on average equity - Non-GAAP

Adjusted net income for the three months ended September 30, 2022 was $19.4
million, a decrease of $1.3 million, or 6.4%, from the three months ended
September 30, 2021, driven by declines in our mortgage business. For the three
months ended September 30, 2022, adjusted return on average equity was 14.8%, as
compared to 20.5% at September 30, 2021, with the decrease driven by lower
adjusted net income and the higher average equity balances as a result of the WP
Transaction.

Adjusted net income for the nine months ended September 30, 2022 was $48.8
million, an increase of $1.8 million, or 3.9%, from the nine months ended
September 30, 2021, with the increase driven by improved performance in our
insurance and shipping operations, partially offset by declines in our mortgage
business. For the nine months ended September 30, 2022,

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adjusted return on average equity was 14.2%, as compared to 16.2% at
September 30, 2021, with the decrease primarily driven by the higher average
equity balances as a result of the WP Transaction.

Adjusted EBITDA - Non-GAAP

Adjusted EBITDA for the three months ended September 30, 2022 was $8.9 million,
a decrease of $3.5 million from 2021 driven by realized and unrealized losses on
investments (including impacts to AOCI) and foreign currency translation in
2022.

Adjusted EBITDA for the nine months ended September 30, 2022 was $49.4 million,
a decrease of $35.2 million from 2021, driven by realized and unrealized losses
in 2022 (including impacts to AOCI) compared to gains in 2021, partially offset
by the WP Transaction gain and improved operating performance noted above.

Book Value per share - Non-GAAP

Total stockholders' equity was $519.6 million as of September 30, 2022 compared
to $402.1 million as of September 30, 2021, with the increase driven by the WP
Transaction and cash exercise of Tiptree warrants, partially offset by
comprehensive losses over the trailing four quarters primarily resulting from
unrealized losses on AFS securities and negative impacts from foreign currency
translation. In the nine months ended September 30, 2022, Tiptree returned $5.9
million to stockholders through dividends paid and shares repurchased.

Book value per share for the period ended September 30, 2022 was $10.68, a
decrease from book value per share of $11.37 as of September 30, 2021. The key
drivers of the decrease over the past four quarters were the comprehensive loss
per share primarily associated with unrealized losses on AFS securities,
dividends paid of $0.16 per share, and issuance of shares as a result of the
exercise of warrants and exchanges of vested subsidiary equity awards, partially
offset by the net increase to Tiptree Inc. stockholders' equity from the WP
transaction.


Results by Segment

We classify our business into two reportable segments, Insurance and Mortgage,
with the remainder of our operations aggregated into Tiptree Capital - Other.
Corporate activities include holding company interest expense, corporate
employee compensation and benefits, and other expenses, including, but not
limited to, public company expenses.

The following tables present the components of Revenue, Income (loss) before
taxes and Adjusted net income for the following periods:

                                          Three Months Ended             Nine Months Ended
($ in thousands)                            September 30,                  September 30,
                                         2022           2021            2022            2021
Revenues:
Insurance                             $ 327,028      $ 246,706      $   903,388      $ 721,524
Mortgage                                 15,611         27,425           59,201         87,191
Tiptree Capital - other                  20,839         12,474           65,635         72,265
Corporate                                     -              -                -              -
Total revenues                        $ 363,478      $ 286,605      $ 1,028,224      $ 880,980

Income (loss) before taxes:
Insurance                             $  15,304      $  13,337      $    39,057      $  49,569
Mortgage                                   (940)         6,267            3,350         25,119
Tiptree Capital - other                  19,077         (4,700)          20,468         12,914
Corporate                                (8,316)       (11,320)        

(33,895) (33,151)
Total income (loss) before taxes $ 25,125 $ 3,584 $ 28,980 $ 54,451

Non-GAAP - Adjusted net income (1):
Insurance                             $  19,831      $  19,533      $    59,893      $  46,400
Mortgage                                   (777)         3,961           (3,516)        15,485
Tiptree Capital - other                   5,656          5,522           13,272          8,153
Corporate                                (5,315)        (8,286)         (20,816)       (23,028)
Total adjusted net income             $  19,395      $  20,730      $    48,833      $  47,010


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(1) See "-Non-GAAP Reconciliations" for a discussion of non-GAAP financial
measures.

Insurance

Fortegra is a specialty insurance underwriter and service provider, which
focuses on niche programs and fee-oriented services. The combination of
specialty insurance underwriting, service contract products, and related service
solutions delivered through a vertically integrated business model creates a
blend of traditional underwriting revenues, investment income and unregulated
fee revenues. The business is an agent-driven model, distributing products
through independent insurance agents, consumer finance companies, online
retailers, auto dealers, and regional big box retailers to deliver products that
complement the consumer transaction. As of September 30, 2022, Fortegra was
owned approximately 79.5% by Tiptree Holdings, 17.4% by Warburg and 3.1% by
management and directors of Fortegra, before giving effect to the exercise of
outstanding warrants and the conversion of outstanding preferred stock.

The following tables and discussion present the Insurance segment results,
including non-controlling interests, for the three and nine months ended
September 30, 2022 and 2021.

Results of Operations - Three Months Ended September 30, 2022 compared to 2021

($ in thousands)                                                     Three Months Ended September 30,
                                                    2022                2021              Change              % Change
Revenues:
Earned premiums, net                           $   237,877          $ 175,026          $  62,851                    35.9  %
Service and administrative fees                     83,423             69,664             13,759                    19.8  %
Ceding commissions                                   4,023              2,722              1,301                    47.8  %
Net investment income                                3,632              3,330                302                     9.1  %
Net realized and unrealized gains (losses)          (6,382)            (7,492)             1,110                        NM%
Other revenue                                        4,455              3,456                999                    28.9  %
Total revenues                                 $   327,028          $ 246,706          $  80,322                    32.6  %
Expenses:
Net losses and loss adjustment expenses             97,827          $  61,252          $  36,575                    59.7  %
Member benefit claims                               23,415             19,579              3,836                    19.6  %
Commission expense                                 137,559            104,392             33,167                    31.8  %
Employee compensation and benefits                  22,071             19,526              2,545                    13.0  %
Interest expense                                     5,027              4,268                759                    17.8  %
Depreciation and amortization                        4,742              4,307                435                    10.1  %
Other expenses                                      21,083             20,045              1,038                     5.2  %
Total expenses                                 $   311,724          $ 233,369          $  78,355                    33.6  %
Income (loss) before taxes (1)                 $    15,304          $  13,337          $   1,967                    14.7  %

Key Performance Metrics:
Gross written premiums and premium equivalents $   761,446          $ 588,063          $ 173,383                    29.5  %
Return on average equity                              14.4  %            13.7  %
Underwriting ratio                                    78.4  %            73.8  %
Expense ratio                                         13.1  %            15.8  %
Combined ratio                                        91.5  %            89.6  %

Non-GAAP Financial Measures (2):
Adjusted net income                            $    19,831          $  19,533          $     298                     1.5  %
Adjusted return on average equity                     24.8  %            

26.8 %

(1) Net income was $11,539 for the three months ended September 30, 2022
compared to $9,943 for the three months ended September 30, 2021.

(2) See "-Non-GAAP Reconciliations" for a discussion of non-GAAP financial
measures.

Revenues

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Earned Premiums, net represents the earned portion of gross written and assumed
premiums, less the earned portion that is ceded to third-party reinsurers under
reinsurance agreements. Fortegra's insurance policies generally have a term of
six months to seven years depending on the underlying product and premiums are
earned pro rata over the term of the policy. At the end of each reporting
period, premiums written but not earned are classified as unearned premiums and
are earned in subsequent periods over the remaining term of the policy.

Service and Administrative Fees represent the earned portion of gross written
premiums and premium equivalents, which is generated from non-insurance products
including warranty service contracts, motor club contracts and other services
offered as part of Fortegra's vertically integrated product offerings. Such fees
are typically positively correlated with transaction volume and are recognized
as revenue when realized and earned. At the end of each reporting period, gross
written premiums and premium equivalents written for service contracts not
earned are classified as deferred revenue, which are earned in subsequent
periods over the remaining term of the policy.

Ceding Commissions and Other Revenue consists of commissions earned on policies
written on behalf of third-party insurance companies with no exposure to the
insured risk and certain fees earned in conjunction with underwriting policies.
Other revenue also includes the interest income earned on the premium finance
product offering.

Net Investment Income is earned on the portfolio of invested assets. Invested
assets are primarily comprised of fixed maturity securities and may also include
cash and cash equivalents and equity securities. The principal factors that
influence net investment income are the size of the investment portfolio, the
yield on that portfolio and expenses due to external investment managers.

Net Realized and Unrealized Gains (Losses) on investments are a function of the
difference between the amount received by us on the sale of a security and the
security's cost-basis, as well as any "other-than-temporary" impairments and
allowances for credit losses which are recognized in earnings. In addition,
equity securities are carried at fair value with unrealized gains and losses
included in this line.

Revenues - Three Months Ended September 30, 2022 compared to 2021

For the three months ended September 30, 2022, total revenues increased 32.6%,
to $327.0 million, as compared to $246.7 million for the three months ended
September 30, 2021. Earned premiums, net of $237.9 million increased $62.9
million, or 35.9%, driven by growth in specialty admitted and E&S insurance
lines. Service and administrative fees of $83.4 million increased by 19.8%
driven by growth in warranty and consumer goods service contract revenues.
Ceding commissions of $4.0 million increased by $1.3 million, or 47.8%, in line
with growth in ceded premiums. Other revenues increased by $1.0 million, or
28.9%, driven by growth in premium finance product offerings.

For the three months ended September 30, 2022, 28.1% of revenues were derived
from fees that were not solely dependent upon the underwriting performance of
Fortegra's insurance products, resulting in more diversified earnings. For the
three months ended September 30, 2022, 77.6% of fee-based revenues were
generated in non-regulated service companies, with the remainder in regulated
insurance companies.

For the three months ended September 30, 2022, net investment income was $3.6
million as compared to $3.3 million in the prior year period, primarily driven
by growth in investments. Net realized and unrealized losses were $6.4 million,
an improvement of $1.1 million, as compared to net realized and unrealized
losses of $7.5 million in the prior year period, primarily driven by the change
in fair value of certain equity and other investments carried at fair value.

Expenses

Underwriting and fee expenses under insurance and warranty service contracts
include losses and loss adjustment expenses, member benefit claims and
commissions expense.

Net Losses and Loss Adjustment Expenses represent actual insurance claims paid,
changes in unpaid claim reserves, net of amounts ceded and the costs of
administering claims for insurance lines. Incurred claims are impacted by loss
frequency, which is a measure of the number of claims per unit of insured
exposure, and loss severity, which is based on the average size of claims. Loss
occurrences in insurance products are characterized by low severity and high
frequency. Factors affecting loss frequency and loss severity include the volume
of underwritten contracts, changes in claims reporting patterns, claims
settlement patterns, judicial decisions, economic conditions, morbidity patterns
and the attitudes of claimants towards settlements, and original pricing of the
product for purposes of the loss ratio in relation to loss emergence over time.
Losses and loss adjustment expenses are based on an actuarial analysis of the
estimated losses, including losses incurred during the period and changes in
estimates from prior periods.

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Member Benefit Claims represent the costs of services and replacement devices
incurred in warranty and motor club service contracts. Member benefit claims
represent claims paid on behalf of contract holders directly to third-party
providers for roadside assistance and for the repair or replacement of covered
products. Claims can also be paid directly to contract holders as a
reimbursement payment, provided supporting documentation of loss is submitted to
the Company. Claims are recognized as expense when incurred.

Commission Expenses reflect commissions paid to retail agents, program
administrators and managing general underwriters, net of ceding commissions
received on business ceded under certain reinsurance contracts. Commission
expenses are deferred and amortized to expense in proportion to the premium
earned over the policy life. Commission expense is incurred on most product
lines. The majority of commissions are retrospective commissions paid to agents,
distributors and retailers selling the Company's products, including credit
insurance policies, warranty service contracts and motor club memberships. When
claims increase, in most cases distribution partners bear the risk through a
reduction in their retrospective commissions. Commission rates are, in many
cases, set by state regulators, such as in credit and collateral protection
programs and are also impacted by market conditions and the retention levels of
distribution partners.

Operating and Other Expenses represent the general and administrative expenses
of insurance operations including employee compensation and benefits and other
expenses, including, technology costs, office rent, and professional services
fees, such as legal, accounting and actuarial services.

Interest Expense consists primarily of interest expense on corporate revolving
debt, notes, preferred trust securities due June 15, 2037 (Preferred Trust
Securities) and asset based debt for premium finance and warranty service
contract financing, which is non-recourse to Fortegra.

Depreciation Expense is primarily associated with furniture, fixtures and
equipment. Amortization Expense is primarily associated with purchase accounting
amortization including values associated with acquired customer relationships,
trade names and internally developed software and technology.

Expenses - Three Months Ended September 30, 2022 compared to 2021

For the three months ended September 30, 2022, net losses and loss adjustment
expenses were $97.8 million, member benefit claims were $23.4 million and
commission expense was $137.6 million, as compared to $61.3 million, $19.6
million and $104.4 million, respectively, for the three months ended September
30, 2021. The increase in net losses and loss adjustment expenses of $36.6
million, or 59.7%, was driven by growth in U.S. and European Insurance lines and
the shift in business mix toward commercial lines, which tend to have higher
loss ratios and lower commission and expense ratios. The increase in member
benefit claims of $3.8 million, or 19.6%, was driven by growth in vehicle
service contracts. Commission expense increased by $33.2 million, or 31.8%,
generally in line with the growth in earned premiums, net and service and
administrative fees.

For the three months ended September 30, 2022, employee compensation and
benefits were $22.1 million and other expenses were $21.1 million, as compared
to $19.5 million and $20.0 million, respectively, for the three months ended
September 30, 2021. Employee compensation and benefits increased by $2.5
million, or 13.0%, driven by investments in human capital associated with growth
in admitted, E&S and warranty lines. Other expenses increased by $1.0 million,
or 5.2%, driven primarily by premium taxes.

For the three months ended September 30, 2022, interest expense was $5.0 million
as compared to $4.3 million for the three months ended September 30, 2021. The
increase in interest expense of $0.8 million, or 17.8%, was primarily driven by
increased asset based debt for premium finance lines and the rise in short-term
interest rates.

For the three months ended September 30, 2022, depreciation and amortization
expense was $4.7 million, including $4.1 million of intangible amortization
related to purchase accounting associated with the acquisitions of Fortegra,
Smart AutoCare, Sky Auto and ITC, as compared to $4.3 million, including $3.8
million of intangible amortization from purchase accounting in 2021.

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Results of Operations - Nine Months Ended September 30, 2022 compared to 2021


($ in thousands)                                                      Nine Months Ended September 30,
                                                    2022                 2021               Change              % Change
Revenues:
Earned premiums, net                           $   662,234          $   498,903          $ 163,331                    32.7  %
Service and administrative fees                    232,883              191,414             41,469                    21.7  %
Ceding commissions                                   9,886                8,827              1,059                    12.0  %
Net investment income                               10,164                9,331                833                     8.9  %
Net realized and unrealized gains (losses)         (23,151)               5,004            (28,155)                       NM%
Other revenue                                       11,372                8,045              3,327                    41.4  %
Total revenues                                 $   903,388          $   721,524          $ 181,864                    25.2  %
Expenses:
Net losses and loss adjustment expenses        $   264,056          $   181,244          $  82,812                    45.7  %
Member benefit claims                               66,297               55,954             10,343                    18.5  %
Commission expense                                 382,435              292,580             89,855                    30.7  %
Employee compensation and benefits                  64,159               57,007              7,152                    12.5  %
Interest expense                                    15,166               13,097              2,069                    15.8  %
Depreciation and amortization                       13,697               12,905                792                     6.1  %
Other expenses                                      58,521               59,168               (647)                   (1.1) %
Total expenses                                 $   864,331          $   671,955          $ 192,376                    28.6  %
Income (loss) before taxes (1)                 $    39,057          $    49,569          $ (10,512)                       NM%

Key Performance Metrics:
Gross written premiums and premium equivalents $ 1,956,998          $ 1,618,076          $ 338,922                    20.9  %
Return on average equity                              12.1  %              17.3  %
Underwriting ratio                                    77.8  %              74.9  %
Expense ratio                                         13.2  %              16.1  %
Combined ratio                                        91.0  %              91.0  %

Non-GAAP Financial Measures (2):
Adjusted net income                            $    59,893          $    46,400          $  13,493                    29.1  %
Adjusted return on average equity                     25.8  %              

20.9 %

(1) Net income was $27,958 for the nine months ended September 30, 2022
compared to $38,412 for the nine months ended September 30, 2021.

(2) See "-Non-GAAP Reconciliations" for a discussion of non-GAAP financial
measures.

Revenues - Nine Months Ended September 30, 2022 compared to 2021

For the nine months ended September 30, 2022, total revenues increased 25.2%, to
$903.4 million, as compared to $721.5 million for the nine months ended
September 30, 2021. Earned premiums, net of $662.2 million increased $163.3
million, or 32.7%, driven by growth in admitted and E&S commercial lines.
Service and administrative fees of $232.9 million increased by 21.7% driven by
growth in warranty and consumer goods service contract revenues. Ceding
commissions of $9.9 million increased by $1.1 million, or 12.0%, driven by
higher ceding fees. Other revenues increased by $3.3 million, or 41.4%, driven
by growth in premium finance product offerings.

For the nine months ended September 30, 2022, 28.1% of revenues were derived
from fees that were not solely dependent upon the underwriting performance of
Fortegra's insurance products, resulting in more diversified earnings. For the
nine months ended September 30, 2022, 78.6% of fee-based revenues were generated
in non-regulated service companies, with the remainder in regulated insurance
companies.

For the nine months ended September 30, 2022, net investment income was $10.2
million as compared to $9.3 million in the prior year period, primarily driven
by growth in investments. Net realized and unrealized losses were $23.2 million,
compared to net realized and unrealized gains of $5.0 million in the prior year
period, primarily driven by the change in fair value of equity securities and
other investments carried at fair value.

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Expenses - Nine Months Ended September 30, 2022 compared to 2021

For the nine months ended September 30, 2022, net losses and loss adjustment
expenses were $264.1 million, member benefit claims were $66.3 million and
commission expense was $382.4 million, as compared to $181.2 million, $56.0
million and $292.6 million, respectively, for the nine months ended September
30, 2021. The increase in net losses and loss adjustment expenses of $82.8
million, or 45.7%, was driven by growth in U.S. and European Insurance lines and
the shift in business mix toward commercial lines, which tend to have a higher
loss ratios and lower commission ratios. During the nine months ended September
30, 2022, the Company experienced a decrease in prior year development of $2.2
million primarily as a result of lower than expected claim severity in its
commercial lines of business. In the nine months ended September 30, 2021 the
Company experienced an increase in prior year development of $3.9 million
primarily driven by higher-than-expected claim severity from business written by
a small group of producers of our personal and commercial lines of business. The
increase in member benefit claims of $10.3 million, or 18.5%, was driven by
growth in vehicle service contracts. Commission expense increased by $89.9
million, or 30.7%, in line with the growth in earned premiums, net and service
and administrative fees.

For the nine months ended September 30, 2022, employee compensation and benefits
were $64.2 million and other expenses were $58.5 million, as compared to $57.0
million and $59.2 million, respectively, for the nine months ended September 30,
2021. Employee compensation and benefits increased by $7.2 million, or 12.5%,
driven by investments in human capital associated with growth in admitted, E&S
and warranty lines. Other expenses decreased by $0.6 million, or 1.1%, driven
primarily by the deferral of current and certain prior year marketing and
advertising costs aligned with the deferral of revenues from Sky Auto, partially
offset by increases in premium taxes, which grew in line with earned premiums.

For the nine months ended September 30, 2022, interest expense was $15.2 million
as compared to $13.1 million for the nine months ended September 30, 2021. The
increase in interest expense of $2.1 million, or 15.8%, was primarily driven by
increased asset based debt for premium finance lines and the rise in short-term
interest rates.

For the nine months ended September 30, 2022, depreciation and amortization
expense was $13.7 million, including $12.1 million of intangible amortization
related to purchase accounting associated with the acquisitions of Fortegra,
Smart AutoCare, Sky Auto and ITC, as compared to $12.9 million, including $11.5
million of intangible amortization from purchase accounting in 2021.

Key Performance Metrics

We discuss certain key performance metrics, described below, which provide
useful information about our business and the operational factors underlying its
financial performance.

Gross Written Premiums and Premium Equivalents

Gross written premiums and premium equivalents represent total gross written
premiums from insurance policies and warranty service contracts issued, as well
as premium finance volumes during a reporting period. They represent the volume
of insurance policies written or assumed and warranty service contracts issued
during a specific period of time without reduction for policy acquisition costs,
reinsurance costs or other deductions. Gross written premiums is a volume
measure commonly used in the insurance industry to compare sales performance by
period. Premium equivalents are used to compare sales performance of warranty
service and administrative contract volumes to gross written premiums. Investors
also use these measures to compare sales growth among comparable companies,
while management uses these measures to evaluate the relative performance of
various sales channels.

The below table shows gross written premiums and premium equivalents by business
mix for the three and nine months ended September 30, 2022 and 2021.

                                Three Months Ended              Nine Months Ended
($ in thousands)                  September 30,                   September 30,
                               2022           2021            2022             2021
U.S. Insurance              $ 534,272      $ 376,437      $ 1,317,662      $ 1,065,735
U.S. Warranty Solutions       196,302        181,506          541,815          482,454
Europe Warranty Solutions      30,872         30,120           97,521           69,887
Total                       $ 761,446      $ 588,063      $ 1,956,998      $ 1,618,076



Total gross written premiums and premium equivalents for the three months ended
September 30, 2022 were $761.4 million, representing an increase of $173.4
million, or 29.5%. Total gross written premiums and premium equivalents for the
nine months ended September 30, 2022 were $1,957.0 million, representing an
increase of $338.9 million, or 20.9%. The increase
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in both periods was driven by a combination of factors including expanding
Fortegra's distribution partner network, growing specialty admitted and E&S
insurance lines, and increasing penetration in the auto and consumer goods
service contract sector.

For the three months ended September 30, 2022, U.S. Insurance increased by
$157.8 million, or 41.9%, driven by growth in specialty commercial insurance
lines. For the three months ended September 30, 2022, U.S. Warranty Solutions
increased by $14.8 million, or 8.2%, driven by growth in auto and roadside
assistance service contracts. Europe Warranty Solutions increased by $0.8
million, or 2.5%, driven by growth in auto warranty lines.

For the nine months ended September 30, 2022, U.S. Insurance increased by $251.9
million, or 23.6%, driven by growth in commercial, E&S, and warranty insurance
lines. For the nine months ended September 30, 2022, U.S. Warranty Solutions
increased by $59.4 million, or 12.3%, driven by growth in auto and roadside
assistance service contracts. Europe Warranty Solutions increased by $27.6
million, or 39.5%, driven by growth in auto warranty lines.

The growth in gross written premiums and premium equivalents, combined with
higher retention in select products as of September 30, 2022, has resulted in an
increase of $413.8 million, or 26.5%, in unearned premiums and deferred revenue
on the condensed consolidated balance sheets as compared to September 30, 2021.
As of September 30, 2022, unearned premiums and deferred revenues were $1,978.2
million, as compared to $1,564.4 million as of September 30, 2021.

Combined Ratio, Underwriting Ratio and Expense Ratio

Combined ratio is an operating measure, which equals the sum of the underwriting
ratio and the expense ratio. Underwriting ratio is the ratio of the GAAP line
items net losses and loss adjustment expenses, member benefit claims and
commission expense to earned premiums, net, service and administrative fees and
ceding commissions and other revenue. Expense ratio is the ratio of the GAAP
line items employee compensation and benefits and other underwriting, general
and administrative expenses to earned premiums, net, service and administrative
fees and ceding commissions and other revenue.

A combined ratio under 100% generally indicates an underwriting profit. A
combined ratio over 100% generally indicates an underwriting loss. These ratios
are commonly used in the insurance industry as a measure of underwriting
profitability, excluding earnings on the insurance portfolio. Investors commonly
use these measures to compare underwriting performance among companies separate
from the performance of the investment portfolio. Management uses these measures
to compare the profitability of various products underwritten as well as
profitability among programs between various agents and sales channels.

The combined ratio was 91.5% for the three months ended September 30, 2022,
which consisted of an underwriting ratio of 78.4% and an expense ratio of 13.1%,
as compared to 89.6%, 73.8% and 15.8%, respectively, for the three months ended
September 30, 2021. The combined ratio for the three month period increased by
1.9%, driven by an increase in the underwriting ratio, offset by a decrease in
the expense ratio, both related to changes in product mix toward lines with
higher loss ratios and lower expense ratios.

The combined ratio was 91.0% for the nine months ended September 30, 2022, which
consisted of an underwriting ratio of 77.8% and an expense ratio of 13.2%, as
compared to 91.0%, 74.9% and 16.1%, respectively, for the nine months ended
September 30, 2021. The combined ratio remained consistent for the nine month
period, driven by the scalability of Fortegra's technology and shared service
platform, which improved the expense ratio, while the underwriting ratio
increased due to a shift in business mix toward lines with higher loss ratios
and lower expense ratios.

Return on Average Equity

Return on average equity is expressed as the ratio of net income to average
stockholders' equity during the period. Management uses this ratio as a measure
of the on-going performance of the totality of the Company's operations.

Return on average equity was 14.4% for the three months ended September 30,
2022, as compared to 13.7% for the prior year period. The increase in net income
and annualized return on average equity was driven by revenue growth and a
consistent combined ratio.

Return on average equity was 12.1% for the nine months ended September 30, 2022,
as compared to 17.3% for the nine months ended September 30, 2021. The decrease
in net income and annualized return on average equity was driven by net realized
and unrealized losses in the 2022 period compared to net realized and unrealized
gains in the 2021 periods as well as higher average equity balances, partially
offset by revenue growth and an improved combined ratio.

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Non-GAAP Financial Measures

Underwriting and Fee Revenues and Underwriting and Fee Margin - Non-GAAP(1)

In order to better explain to investors the underwriting performance of the
Company's programs and the respective retentions between the Company and its
agents and reinsurance partners, we use the non-GAAP metrics - underwriting and
fee revenues and underwriting and fee margin. Underwritten exposures are managed
using both reinsurance (e.g., quota share and excess of loss) and retrospective
commission agreements with Fortegra's agents (e.g., commissions paid are
adjusted based on the actual underlying losses incurred). Period-over-period
comparisons of revenues and expenses are often impacted by the agents and their
PORC's choice as to their risk retention appetite, specifically earned premiums,
net, service and administration fees, ceding commissions, and other revenue, all
components of revenue, and losses and loss adjustment expenses, member benefit
claims, and commissions paid to Fortegra's agents and reinsurers. Generally,
when losses are incurred, the risk which is retained by Fortegra's agents and
reinsurers is reflected in a reduction in commissions paid.

Underwriting and fee revenues represents total revenues excluding net investment
income, net realized and unrealized gains (losses). See "-Non-GAAP
Reconciliations" for a reconciliation of underwriting and fee revenues to total
revenues in accordance with GAAP.

Underwriting and fee margin represents income before taxes excluding net
investment income, net realized and unrealized gains (losses), employee
compensation and benefits, other expenses, interest expense and depreciation and
amortization. Fortegra's products and services are delivered on a vertically
integrated basis to its agents. As such, underwriting and fee margin exclude
general and administrative expenses, interest income, depreciation and
amortization and other corporate expenses, including income taxes, as these
corporate expenses support the vertically integrated delivery model and are not
specifically supporting any individual business line. See "-Non-GAAP
Reconciliations" for a reconciliation of underwriting and fee margin to total
revenues in accordance with GAAP.

The below tables show underwriting and fee revenues and underwriting and fee
margin by business mix for the three and nine months ended September 30, 2022
and 2021.
                                                                Three Months Ended September 30,
                                                                                           Underwriting and Fee
($ in thousands)                                 Underwriting and Fee Revenues (1)              Margin (1)
                                                      2022                   2021                         2022               2021
U.S. Insurance                                 $        243,564          $ 174,995                    $  42,981          $  37,005
U.S. Warranty Solutions                                  71,557             61,342                       22,542             23,455
Europe Warranty Solutions                                14,657             14,531                        5,454              5,185
Total                                          $        329,778          $ 250,868                    $  70,977          $  65,645

(1) See "-Non-GAAP Reconciliations" for a discussion of non-GAAP financial
measures.

Underwriting and fee revenues were $329.8 million for the three months ended
September 30, 2022 as compared to $250.9 million for the three months ended
September 30, 2021. Total underwriting and fee revenues increased $78.9 million,
or 31.5%, driven by growth in U.S. Insurance and U.S. Warranty Solutions. The
increase in U.S. Insurance was $68.6 million, or 39.2%, driven by growth in
specialty commercial insurance lines. The increase in U.S. Warranty Solutions
was $10.2 million, or 16.7%, driven by growth in auto, roadside assistance, and
premium finance offerings. Europe Warranty Solutions increased by $0.1 million,
or 0.9%.

Underwriting and fee margin was $71.0 million for the three months ended
September 30, 2022 as compared to $65.6 million for the three months ended
September 30, 2021. Total underwriting and fee margin increased $5.3 million, or
8.1%, driven by growth in U.S. Insurance. U.S. Insurance grew by $6.0 million,
or 16.1%, driven by revenue growth in admitted and E&S lines. U.S. Warranty
Solutions decreased by $0.9 million, or 3.9%, primarily driven by the deferral
of revenues associated with contracts acquired by Sky Auto. This current period
revenue deferral for Sky Auto was offset by the deferral of direct marketing
costs in other expenses and therefore had minimal impact on the combined ratio
or income before taxes. Europe Warranty Solutions increased by $0.3 million, or
5.2%, driven by growth in auto and consumer goods service contracts.
.
                                                                 Nine 

Months Ended September 30,

                                                                                            Underwriting and Fee
($ in thousands)                                  Underwriting and Fee Revenues (1)              Margin (1)
                                                       2022                   2021                        2022               2021
U.S. Insurance                                  $   673,009               $ 504,038                   $ 123,546          $ 101,812
U.S. Warranty Solutions                             200,045                 168,476                      64,197             65,453
Europe Warranty Solutions                            43,321                  34,675                      15,844             10,146
Total                                           $   916,375               $ 707,189                   $ 203,587          $ 177,411


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(1) See "-Non-GAAP Reconciliations" for a discussion of non-GAAP financial
measures.

Underwriting and fee revenues were $916.4 million for the nine months ended
September 30, 2022 as compared to $707.2 million for the nine months ended
September 30, 2021. Total underwriting and fee revenues increased $209.2
million, or 29.6%, driven by growth in all business lines. The increase in U.S.
Insurance was $169.0 million, or 33.5%, driven by growth in commercial, E&S, and
credit insurance lines. The increase in U.S. Warranty Solutions was $31.6
million, or 18.7%, driven by growth in auto, roadside assistance, and premium
finance offerings. Europe Warranty Solutions increased by $8.6 million, or
24.9%, driven by growth in auto and consumer goods service contracts.

Underwriting and fee margin was $203.6 million for the nine months ended
September 30, 2022 as compared to $177.4 million for the nine months ended
September 30, 2021. Total underwriting and fee margin increased $26.2 million,
or 14.8%, driven by growth in U.S. Insurance and Europe Warranty Solutions. U.S.
Insurance grew by $21.7 million, or 21.3%, from growth in specialty admitted and
E&S lines. U.S. Warranty Solutions decreased by $1.3 million, or 1.9%, primarily
driven by the deferral of revenues associated with contracts acquired by Sky
Auto. This current period revenue deferral for Sky Auto was offset by the
deferral of direct marketing costs in other expenses and therefore had minimal
impact on the combined ratio or income before taxes. Europe Warranty Solutions
increased by $5.7 million, or 56.2%, driven by growth in auto and consumer goods
service contracts.

Adjusted Net Income and Adjusted Return on Average Equity

Adjusted net income represents income before taxes, less provision (benefit) for
income taxes, and excluding the after-tax impact of various expenses that we
consider to be unique and non-recurring in nature, including merger and
acquisition related expenses, stock-based compensation, net realized and
unrealized gains (losses), and intangibles amortization associated with purchase
accounting.

Adjusted return on average equity represents adjusted net income expressed on an
annualized basis as a percentage of average beginning and ending stockholders'
equity during the period.

Management uses both these measures for executive compensation and as a measure
of the on-going performance of our operations. See "-Non-GAAP Reconciliations"
for a reconciliation of adjusted net income and adjusted return on average
equity to income before taxes and adjusted return on average equity.

For the three months ended September 30, 2022, adjusted net income and adjusted
return on average equity were $19.8 million and 24.8%, respectively, as compared
to $19.5 million and 26.8%, respectively, for the three months ended September
30, 2021. For the nine months ended September 30, 2022, adjusted net income and
adjusted return on average equity were $59.9 million and 25.8%, respectively, as
compared to $46.4 million and 20.9%, respectively, for the nine months ended
September 30, 2021. The improvement of adjusted net income in both periods was
driven by the growth in underwriting and fee revenues.

Net Investment Income and Net Realized and Unrealized Gains (Losses) on
Investments

The insurance investment portfolio includes investments held in statutory
insurance companies and in unregulated entities. The portfolios held in
statutory insurance companies are subject to different regulatory
considerations, including with respect to types of assets, concentration limits,
affiliate transactions and the use of leverage. Fortegra's investment strategy
is designed to achieve attractive risk-adjusted returns across select asset
classes, sectors and geographies while maintaining adequate liquidity to meet
claims payment obligations. As such, volatility from realized and unrealized
gains and losses may impact period-over-period performance. Unrealized gains and
losses on equity securities and loans held at fair value impact current period
net income, while unrealized gains and losses on AFS securities impact AOCI.

Net investment income includes interest and dividends, net of investment
expenses, on invested assets. Net realized and unrealized gains and losses on
investments are reported separately from net investment income.

For the three months ended September 30, 2022, net investment income was $3.6
million as compared to $3.3 million in the prior year period, driven by growth
in investments. Net realized and unrealized losses were $6.4 million, compared
to losses of $7.5 million in the prior year period, both driven by realized and
unrealized losses on certain equity securities and other investments, including
fixed income securities carried at fair value. Unrealized losses on AFS
securities impacting OCI for the three months ended September 30, 2022 were
$18.1 million, driven by the rise in interest rates and corresponding impact to
the fair value of investments in U.S. Treasuries, obligations of U.S. government
agencies, corporate securities, obligations of state and political subdivisions,
and asset-backed securities.

For the nine months ended September 30, 2022, net investment income was $10.2
million as compared to $9.3 million in the prior year period, driven by growth
in investments. Net realized and unrealized losses were $23.2 million, compared
to gains
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of $5.0 million in the prior year period, driven by realized and unrealized
losses on certain equity securities and other investments, including fixed
income securities carried at fair value, in the 2022 period as compared to gains
in the 2021 period. Unrealized losses on AFS securities impacting OCI for the
nine months ended September 30, 2022 were $56.5 million, driven by the rise in
interest rates and corresponding impact to the fair value of investments in U.S.
Treasuries, obligations of U.S. government agencies, corporate securities,
obligations of state and political subdivisions, and asset-backed securities.

Tiptree Capital

Tiptree Capital consists of our Mortgage segment, which includes the operating
results of Reliance, our mortgage business, and Tiptree Capital - Other, which
consists of our other non-insurance operating businesses and investments. As of
September 30, 2022, Tiptree Capital - Other includes our Invesque shares and
maritime transportation operations (including two product tankers).

Mortgage

Through our Mortgage operating subsidiary, Reliance, we originate, sell,
securitize and service one-to-four-family, residential mortgage loans, comprised
of conforming mortgage loans, Federal Housing Administration ("FHA"), Veterans
Administration ("VA"), United States Department of Agriculture ("USDA"), and to
a lesser extent, non-agency jumbo prime.

We are an approved seller/servicer for Fannie Mae and Freddie Mac. We are also
an approved issuer and servicer for Ginnie Mae. We originate residential
mortgage loans through our retail distribution channel (directly to consumers)
in 39 states and the District of Columbia as of September 30, 2022.

The following tables present the Mortgage segment results for the following
periods:

Results of Operations

                                                   Three Months Ended                      Nine Months Ended
($ in thousands)                                      September 30,                          September 30,
                                                 2022               2021               2022                2021

Revenues:

Net realized and unrealized gains (losses) $ 10,847 $ 22,651

       $  44,711          $    73,454
Other revenue                                    4,764              4,774             14,490               13,737
Total revenues                               $  15,611          $  27,425          $  59,201          $    87,191
Expenses:
Employee compensation and benefits           $   9,517          $  14,382          $  35,137          $    42,849
Interest expense                                   475                276              1,116                  837
Depreciation and amortization                      190                218                618                  670
Other expenses                                   6,369              6,282             18,980               17,716
Total expenses                               $  16,551          $  21,158          $  55,851          $    62,072
Income (loss) before taxes                   $    (940)         $   6,267          $   3,350          $    25,119

Key Performance Metrics:
Origination volumes                          $ 279,793          $ 384,958          $ 940,958          $ 1,180,772
Gain on sale margins                               4.9  %             5.5  %             4.6  %               5.7  %
Return on average equity                          (5.9) %            36.5  %             5.6  %              44.4  %

Non-GAAP Financial Measures (1):
Adjusted net income                          $    (777)         $   3,961          $  (3,516)         $    15,485
Adjusted return on average equity                 (5.4) %            23.0  %            (8.0) %              33.3  %

(1) See "Non-GAAP Reconciliations" for a discussion of non-GAAP financial
measures.

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Revenues

Net Realized and Unrealized Gains (Losses) include gains on sale of mortgage
loans and the fair value adjustment in mortgage servicing rights. Gains on the
sale of mortgage loans represent the difference between the selling price and
carrying value of loans sold and are recognized upon settlement. Such gains also
include the changes in fair value of loans held for sale and loan-related hedges
and derivatives. We transfer the risk of loss or default to the loan purchaser,
however, in some cases we are required to indemnify purchasers for losses
related to non-compliance with borrowers' creditworthiness and collateral
requirements. Because of this, we recognize gains on sale net of required
indemnification and premium recapture reserves. The fair value adjustment on
mortgage servicing rights represents fair value adjustments considering
estimated prepayments and other factors associated with changes in interest
rates, plus actual run-off in the servicing portfolio. We report these
adjustments separate from servicing income and servicing expense.

Other Revenue includes loan origination fees, interest income, and mortgage
servicing income. Loan origination fees are earned as mortgage loans are funded.
Servicing fees are earned over the life of the loan. Interest income includes
interest earned on loans held for sale and interest income on bank balances and
short-term investments.

Revenues - Three and Nine Months Ended September 30, 2022 compared to 2021

For the three months ended September 30, 2022, $279.8 million of loans were
funded, compared to $385.0 million for 2021, a decrease of $105.2 million, or
27.3%. Gain on sale margins decreased to 4.9% for the three months ended
September 30, 2022, down approximately 60 basis points from 5.5% for the three
months ended September 30, 2021. For the nine months ended September 30, 2022,
$941.0 million of loans were funded, compared to $1.18 billion for 2021, a
decrease of $239.8 million, or 20.3%. Origination volumes for both periods in
2022 declined given the rise in mortgage interest rates. Gain on sale margins
decreased to 4.6% for the nine months ended September 30, 2022, down
approximately 110 basis points from 5.7% for the nine months ended September 30,
2021.

Net realized and unrealized gains for the three months ended September 30, 2022
were $10.8 million, compared to $22.7 million for 2021, a decrease of $11.8
million or 52.1%. The primary driver of decreased gain on sale revenues was the
decline in volumes and gain on sale margins, partially offset by positive fair
value adjustments in mortgage servicing rights of $82 thousand as prepayment
speeds declined from December 31, 2021. Net realized and unrealized gains for
the nine months ended September 30, 2022 were $44.7 million, compared to $73.5
million for 2021, a decrease of $28.7 million or 39.1%. The primary driver of
decreased gain on sale revenues was the decline in volumes and gain on sale
margins, partially offset by positive fair value adjustments in mortgage
servicing rights of $8.0 million as prepayment speeds declined from December 31,
2021.

Other revenue for the three months ended September 30, 2022 remained flat at
$4.8 million. Other revenue for the nine months ended September 30, 2022 was
$14.5 million, compared to $13.7 million for 2021, an increase of $0.8 million,
or 5.5%. The increase for the nine month period is driven primarily by higher
servicing fees from an increase in loans serviced. As of September 30, 2022, the
mortgage servicing asset was valued at $41.9 million, an increase from $29.8
million as of December 31, 2021.

Expenses

Employee Compensation and Benefits includes salaries, commissions, benefits,
bonuses, other incentive compensation and related taxes for employees.
Commissions expense for sales staff generally varies with loan origination
volumes.

Interest Expense represents borrowing costs under warehouse and other credit
facilities used primarily to fund loan originations. Amortization of deferred
financing costs, including commitment fees, is included in interest expense.

Depreciation is mainly associated with furniture, fixtures and equipment.
Amortization expense is primarily associated with a trade name and internally
developed software.

Other Expenses include loan origination expenses, namely, leads, appraisals,
credit reporting and licensing fees, general and administrative expenses,
including office rent, insurance, legal, consulting and payroll processing
expenses, and servicing expense.

Expenses - Three and Nine Months Ended September 30, 2022 compared to 2021

For the three months ended September 30, 2022, employee compensation and
benefits were $9.5 million, compared to $14.4 million in 2021, a decrease of
$4.9 million or 33.8%. For the nine months ended September 30, 2022, employee
compensation and benefits were $35.1 million, compared to $42.8 million in 2021,
a decrease of $7.7 million or 18.0%. The decrease in both periods was driven
primarily by reduced commissions on lower origination volumes.
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For the three months ended September 30, 2022 and 2021, interest expense was at
$0.5 million, an increase of $0.2 million or 72.1% driven by higher interest
rates. For the nine months ended September 30, 2022 and 2021, interest expense
was at $1.1 million, an increase of $0.3 million or 33.3% driven by higher
interest rates.

For the three months ended September 30, 2022, other expenses were $6.4 million,
compared to $6.3 million in 2021, with the $0.1 million increase driven by
increased loan origination expenses, including marketing costs. For the nine
months ended September 30, 2022, other expenses were $19.0 million, compared to
$17.7 million in 2021, with the $1.3 million increase driven by the same factors
that impacted the three months.

Income (loss) before taxes

Loss before taxes for the three months ended September 30, 2022 was $0.9
million, compared to $6.3 million of income in 2021. Income before taxes for the
nine months ended September 30, 2022 was $3.4 million, compared to $25.1 million
in 2021. The decrease in both periods was driven by a decline in volumes and
margins, partially offset by higher servicing fees attributable to the larger
servicing portfolio, in addition to positive fair value adjustments on the
mortgage servicing rights asset, as compared to 2021.

Tiptree Capital - Other

The following tables present a summary of Tiptree Capital - Other results for
the following periods:

Results of Operations

                                                                    Three Months Ended September 30,
                                                                                               Income (loss) before
($ in thousands)                                                 Total revenue                         taxes
                                                            2022                   2021                     2022               2021
Senior living (Invesque)                             $     (1,405)             $ (10,396)               $  (1,405)         $ (10,396)
Maritime transportation                                    21,928                 11,424                   20,124              5,231
Other (1)                                                     316                 11,446                      358                465
Total                                                $     20,839              $  12,474                $  19,077          $  (4,700)

                                                                     Nine Months Ended September 30,
                                                                                               Income (loss) before
($ in thousands)                                                 Total revenue                         taxes
                                                            2022                   2021                     2022               2021
Senior living (Invesque)                             $    (12,924)             $   3,512                $ (12,924)         $   3,512
Maritime transportation                                    49,554                 25,041                   36,537              7,738
Other (1)                                                  29,005                 43,712                   (3,145)             1,664
Total                                                $     65,635              $  72,265                $  20,468          $  12,914

(1) Includes our held for sale mortgage originator (Luxury), asset management,
and certain intercompany elimination transactions.

Revenues

Tiptree Capital - Other earns revenues from the following sources: net interest
income; revenues on our formerly held for sale mortgage originator (Luxury);
realized and unrealized gains and losses on the Company's investment holdings
(primarily Invesque); and charter revenues from vessels within the Company's
maritime transportation operations. Subsequent to the sale of our dry bulk and
tanker vessels, operations include two smaller seaborne vessels and other
ancillary assets.

Revenues for the three months ended September 30, 2022 were $20.8 million
compared to $12.5 million for 2021. The primary drivers of the increase in
revenues were the gain of $14.1 million related to the sale of two dry bulk
vessels and increased dry bulk and tanker charter rates earned by the maritime
transportation business, partially offset by unrealized losses on our investment
in Invesque. Revenues for the nine months ended September 30, 2022 were $65.6
million compared to $72.3 million for 2021 with the decline primarily driven by
unrealized losses on our investment in Invesque in the 2022 period compared to
gains in the 2021 period and the deconsolidation of Luxury effective July 1,
2022, offset by higher charter rates and gain on sale of three dry bulk vessels
in our maritime transportation business.

Income (loss) before taxes

The income before taxes from Tiptree Capital - Other for the three months ended
September 30, 2022 was $19.1 million,

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compared to the loss before taxes of $4.7 million in 2021. The income before
taxes from Tiptree Capital - Other for the nine months ended September 30, 2022
was $20.5 million, compared to income before taxes of $12.9 million in 2021,
with the increase for both periods driven by the same factors that impacted
revenues.

Adjusted net income - Non-GAAP(1)

                                Three Months Ended              Nine Months Ended
($ in thousands)                   September 30,                  September 30,
                                 2022            2021           2022          2021
Senior living (Invesque)   $        -          $     -      $        -      $     -
Maritime transportation         5,477            5,503          12,949        8,074
Other                             180               19             324           79
Total                      $    5,657          $ 5,522      $   13,273      $ 8,153

(1) See "-Non-GAAP Reconciliations" for a discussion of non-GAAP financial
measures.

Adjusted net income increased to $13.3 million for the nine months ended
September 30, 2022 compared to $8.2 million in 2021. The increase was driven by
the improvement in maritime transportation operations.

Corporate

The following table presents a summary of corporate results for the following
periods:

Results of Operations

                                              Three Months Ended            Nine Months Ended
($ in thousands)                                September 30,                 September 30,
                                              2022           2021          2022           2021
Employee compensation and benefits        $    1,880      $  1,785      $   5,824      $  5,621
Employee incentive compensation expense        3,032         4,835         12,069        10,760
Interest expense                                   -         2,553          4,224         7,675
Depreciation and amortization                    205           203            604           602
Other expenses                                 3,199         1,944         11,174         8,493
Total expenses                            $    8,316      $ 11,320      $  33,895      $ 33,151


Corporate expenses include expenses of the holding company for interest expense,
employee compensation and benefits, and public company and other expenses.
Corporate employee compensation and benefits includes the expense of management,
legal and accounting staff. Other expenses primarily consisted of audit and
professional fees, insurance, office rent and other related expenses.

Employee compensation and benefits, including incentive compensation expense,
were $17.9 million for the nine months ended September 30, 2022, compared to
$16.4 million for 2021, driven by an increase in performance related employee
incentive compensation. Of the incentive compensation expense in the nine months
ended September 30, 2022, $5.4 million was stock-based compensation expense
primarily related to awards granted in third quarter 2021. Interest expense for
the nine months ended September 30, 2022 and 2021 was $4.2 million and $7.7
million, respectively. As of September 30, 2022, the Company had no outstanding
borrowings at the holding company, compared to $114.1 million at December 31,
2021. Other expenses of $11.2 million increased by $2.7 million from the nine
months ended September 30, 2021, primarily driven by a $2.1 million loss on
extinguishment of debt and increased consulting and professional fees.

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Provision for Income Taxes

On June 21, 2022, the WP Transaction was completed, in which Warburg invested
$200.0 million in Tiptree's insurance subsidiary, Fortegra. The WP Transaction,
along with Fortegra management's ownership, reduced Tiptree's equity ownership
in Fortegra below 80% such that, while still consolidated for GAAP financial
reporting purposes, Fortegra will no longer be included in the consolidated tax
return group with Tiptree. Tiptree has recorded deferred tax liabilities related
to the basis difference in Tiptree's investment in Fortegra as of September 30,
2022. This deferred tax liability represents the tax that would be due, before
consideration of loss carryforwards, if Tiptree were to sell any of its Fortegra
stock at its carrying value on Tiptree's balance sheet. The deferred tax
liability as of September 30, 2022 relating to the WP Transaction was
$38.2 million, of which $14.1 million was recorded directly in Tiptree Inc.
stockholders' equity with respect to the gain component and $24.1 million was
recorded as a provision for income taxes in the condensed consolidated
statements of operations for the nine months ended September 30, 2022.

The total income tax expense of $5.1 million for the three months ended
September 30, 2022 and $0.2 million for the three months ended September 30,
2021 are reflected as components of net income (loss). For the three months
ended September 30, 2022, the Company's effective tax rate was equal to 20.2%.
The effective rate for the three months ended September 30, 2022 was slightly
lower than the U.S. statutory income tax rate of 21.0%, primarily from the
impact of discrete items, partially offset by state taxes. For the three months
ended September 30, 2021, the Company's effective tax rate was equal to 6.6%.
The effective rate for the three months ended September 30, 2021 was lower than
the U.S. federal statutory income tax rate of 21.0%, primarily from the impact
of foreign operations and discrete items, partially offset by state taxes.

The total income tax expense of $31.5 million for the nine months ended
September 30, 2022 and $11.4 million for the nine months ended September 30,
2021 are reflected as components of net income (loss). For the nine months ended
September 30, 2022, the Company's effective tax rate was equal to 108.9%. The
effective rate for the nine months ended September 30, 2022 was significantly
higher than the U.S. statutory income tax rate of 21.0%, primarily from the
impact of recording deferred taxes relating to the tax deconsolidation of
Fortegra. For the nine months ended September 30, 2021, the Company's effective
tax rate was equal to 21.0%. The effective rate for the nine months ended
September 30, 2021 was equal to the U.S. federal statutory income tax rate of
21.0%, due to the impact of state taxes offset by other discrete items.

On August 16, 2022, the U.S. government enacted Public Law no. 117-169, commonly
referred to as the Inflation Reduction Act, which, among other things,
establishes a corporate minimum tax on book earnings and an excise tax on stock
buybacks. It is not expected that this legislation will have a material
financial impact on the Company or its operations.

Balance Sheet Information

Tiptree's total assets were $3,994.1 million as of September 30, 2022, compared
to $3,599.1 million as of December 31, 2021. The $394.9 million increase in
assets is primarily attributable to the growth in the Insurance segment,
proceeds from the WP Transaction and the increase in cash and equivalents from
the sale of our dry bulk vessels.

Total stockholders' equity was $519.6 million as of September 30, 2022, compared
to $400.2 million as of December 31, 2021, with the increase primarily driven by
the WP Transaction, partially offset by other comprehensive losses on available
for sale securities for nine months ended September 30, 2022. As of
September 30, 2022, there were 36,247,257 shares of common stock outstanding as
compared to 34,124,153 as of December 31, 2021, with the increase driven by the
exercise of warrants and the vesting of share-based incentive compensation,
partially offset by stock repurchases.

The following table is a summary of certain balance sheet information:

                                                                            As of September 30, 2022
                                                                       Tiptree Capital
($ in thousands)                             Insurance            Mortgage            Other           Corporate             Total
Total assets                               $ 3,648,191          $ 167,015          $ 73,311          $ 105,567          $ 3,994,084

Corporate debt                             $   160,000          $       -          $      -          $       -          $   160,000
Asset based debt                                58,568             55,288                 -                  -              113,856

Tiptree Inc. stockholders' equity $ 185,679 $ 55,644

        $ 63,668          $  82,288          $   387,279
Non-controlling interests:
Fortegra preferred interests                    77,679                  -                 -                  -          $    77,679
Common interests                                50,795              1,065             2,756                  -               54,616
Total stockholders' equity                 $   314,153          $  56,709          $ 66,424          $  82,288          $   519,574


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NON-GAAP MEASURES AND RECONCILIATIONS

Non-GAAP Reconciliations

In addition to GAAP results, management uses the non-GAAP financial measures
underwriting and fee revenues and underwriting and fee margin in order to better
explain to investors the underwriting performance and the respective retentions
between the Company and its agents and reinsurance partners. We also use the
non-GAAP financial measures adjusted net income, adjusted return on average
equity and Adjusted EBITDA as measures of operating performance and as part of
our resource and capital allocation process, to assess comparative returns on
invested capital. Adjusted EBITDA is also used in determining incentive
compensation for the Company's executive officers. Management believes these
measures provide supplemental information useful to investors as they are
frequently used by the financial community to analyze financial performance and
to compare relative performance among comparable companies. Adjusted net income,
adjusted return on average equity, Adjusted EBITDA, underwriting and fee
revenues and underwriting and fee margin are not measurements of financial
performance or liquidity under GAAP and should not be considered as an
alternative or substitute for earned premiums, net income or any other measure
derived in accordance with GAAP.

Underwriting and Fee Revenues and Underwriting and Fee Margin - Non-GAAP
(Insurance only)

The following tables present revenue and expenses by business mix. We generally
manage exposure to underwriting risks written by using both reinsurance (e.g.,
quota share and excess of loss) and retrospective commission agreements with our
partners (e.g., commissions paid are adjusted based on the actual underlying
losses incurred), which mitigates Fortegra's risk. Period-over-period
comparisons of revenues and expenses are often impacted by the PORCs and
distribution partners' choice as to whether to retain risk, specifically service
and administration fees and ceding commissions, both components of revenue, and
policy and contract benefits and commissions paid to our partners and
reinsurers. Generally, when losses are incurred, the risk which is retained by
our partners and reinsurers is reflected in a reduction in commissions paid. In
order to better explain to investors the underwriting performance and the
respective retentions between the Company and its agents and reinsurance
partners, we use the non-GAAP metrics underwriting and fee revenues and
underwriting and fee margin.

Underwriting and Fee Revenues - Non-GAAP - We define underwriting and fee
revenues as total revenues from the Insurance segment excluding net investment
income and net realized and unrealized gains (losses). Underwriting and fee
revenues represents revenues generated by underwriting and fee-based operations
and allows us to evaluate the Company's underwriting performance without regard
to investment income. We use this metric as we believe it gives our management
and other users of our financial information useful insight into our underlying
business performance. Underwriting and fee revenues should not be viewed as a
substitute for total revenues calculated in accordance with GAAP, and other
companies may define underwriting and fee revenues differently.

                                                    Three Months Ended                     Nine Months Ended
($ in thousands)                                       September 30,                         September 30,
                                                  2022               2021               2022               2021
Total revenues                                $ 327,028          $ 246,706          $ 903,388          $ 721,524
Less: Net investment income                      (3,632)            (3,330)           (10,164)            (9,331)
Less: Net realized and unrealized gains
(losses)                                          6,382              7,492             23,151             (5,004)
Underwriting and fee revenues                 $ 329,778          $ 250,868  

$ 916,375 $ 707,189

Underwriting and Fee Margin - Non-GAAP - We define underwriting and fee margin
as income before taxes from the Insurance segment, excluding net investment
income, net realized and unrealized gains (losses), employee compensation and
benefits, other expenses, interest expense and depreciation and amortization.
Underwriting and fee margin represents the underwriting performance of our
underwriting and fee-based lines. As such, underwriting and fee margin excludes
general administrative expenses, interest expense, depreciation and amortization
and other corporate expenses as those expenses support the vertically integrated
business model and not any individual component of the Company's business mix.
We use this metric as we believe it gives our management and other users of our
financial information useful insight into the specific performance of our
underlying business mix. Underwriting and fee margin should not be viewed as a
substitute for income before taxes calculated in accordance with GAAP, and other
companies may define underwriting and fee margin differently.

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                                                    Three Months Ended                     Nine Months Ended
($ in thousands)                                       September 30,                         September 30,
                                                  2022               2021               2022               2021
Income (loss) before income taxes             $   15,304          $ 13,337          $  39,057          $  49,569
Less: Net investment income                       (3,632)           (3,330)           (10,164)            (9,331)
Less: Net realized and unrealized gains
(losses)                                           6,382             7,492             23,151             (5,004)
Plus: Depreciation and amortization                4,742             4,307             13,697             12,905
Plus: Interest expense                             5,027             4,268             15,166             13,097
Plus: Employee compensation and benefits          22,071            19,526             64,159             57,007
Plus: Other expenses                              21,083            20,045             58,521             59,168
Underwriting and fee margin                   $   70,977          $ 65,645  

$ 203,587 $ 177,411

Adjusted Net Income - Non-GAAP

We define adjusted net income as income before taxes, less provision (benefit)
for income taxes, and excluding the after-tax impact of various expenses that we
consider to be unique and non-recurring in nature, including merger and
acquisition related expenses, stock-based compensation, net realized and
unrealized gains (losses) and intangibles amortization associated with purchase
accounting. We use adjusted net income as an internal operating performance
measure in the management of business as part of our capital allocation process.
We believe adjusted net income provides useful supplemental information to
investors as it is frequently used by the financial community to analyze
financial performance between periods and for comparison among companies.
Adjusted net income should not be viewed as a substitute for income before taxes
calculated in accordance with GAAP, and other companies may define adjusted net
income differently. Adjusted net income is presented before the impacts of
non-controlling interests.

We present adjustments for amortization associated with acquired intangible
assets. The intangible assets were recorded as part of purchase accounting in
connection with Tiptree's acquisition of Fortegra Financial in 2014, Defend in
2019, and Smart AutoCare and Sky Auto in 2020. The intangible assets acquired
contribute to overall revenue generation, and the respective purchase accounting
adjustments will continue to occur in future periods until such intangible
assets are fully amortized in accordance with the respective amortization
periods required by GAAP.

Adjusted Return on Average Equity - Non-GAAP

We define adjusted return on average equity as adjusted net income expressed on
an annualized basis as a percentage of average beginning and ending
stockholders' equity during the period. See "-Adjusted Net Income-Non-GAAP"
above. We use adjusted return on average equity as an internal performance
measure in the management of our operations because we believe it gives our
management and other users of our financial information useful insight into our
results of operations and our underlying business performance. Adjusted return
on average equity should not be viewed as a substitute for return on average
equity calculated in accordance with GAAP, and other companies may define
adjusted return on average equity differently.
                                                            Three Months Ended September 30, 2022
                                                              Tiptree Capital
($ in thousands)                     Insurance          Mortgage            Other           Corporate            Total

Income (loss) before taxes $ 15,304 $ (940) $ 19,077 $ (8,316) $ 25,125
Less: Income tax (benefit) expense (3,765)

               92            (3,963)             2,568             (5,068)
Less: Net realized and unrealized
gains (losses)                          6,382               (82)          (12,694)                 -             (6,394)
Plus: Intangibles amortization (1)      4,115                 -                 -                  -              4,115
Plus: Stock-based compensation
expense                                    33                 -                75              1,588              1,696
Plus: Non-recurring expenses               89                 -                53                  -                142
Plus: Non-cash fair value
adjustments                                 -                 -              (130)                 -               (130)
Less: Tax on adjustments (2)           (2,327)              153             3,238             (1,155)               (91)
Adjusted net income                 $  19,831          $   (777)         $  5,656          $  (5,315)         $  19,395

Adjusted net income                 $  19,831          $   (777)         $  5,656          $  (5,315)         $  19,395
Average stockholders' equity        $ 319,703          $ 57,133          $ 84,445          $  61,178          $ 522,459
Adjusted return on average equity        24.8  %           (5.4) %           26.8  %                NM%            14.8  %



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                                                             Three Months Ended September 30, 2021
                                                              Tiptree Capital
($ in thousands)                     Insurance          Mortgage            Other            Corporate            Total

Income (loss) before taxes $ 13,337 $ 6,267 $ (4,700) $ (11,320) $ 3,584
Less: Income tax (benefit) expense (3,394)

               14              1,591              1,552               (237)
Less: Net realized and unrealized
gains (losses)                          7,428            (1,055)            10,396                  -             16,769
Plus: Intangibles amortization (1)      3,830                 -                  -                  -              3,830
Plus: Stock-based compensation
expense                                   475                 -                197                832              1,504
Plus: Non-recurring expenses              (28)                -                448                  -                420
Plus: Non-cash fair value
adjustments                                 -                 -               (815)                 -               (815)
Less: Tax on adjustments (2)           (2,115)           (1,265)            (1,595)               650             (4,325)
Adjusted net income                 $  19,533          $  3,961          $   5,522          $  (8,286)         $  20,730

Adjusted net income                 $  19,533          $  3,961          $   5,522          $  (8,286)         $  20,730
Average stockholders' equity        $ 291,281          $ 68,925          $ 118,729          $ (75,340)         $ 403,595
Adjusted return on average equity        26.8  %           23.0  %            18.6  %                NM%            20.5  %



                                                             Nine Months Ended September 30, 2022
                                                              Tiptree Capital
($ in thousands)                     Insurance          Mortgage            Other           Corporate            Total

Income (loss) before taxes $ 39,057 $ 3,350 $ 20,468 $ (33,895) $ 28,980
Less: Income tax (benefit) expense (11,099)

             (874)           (3,469)           (16,095)           (31,537)
Less: Net realized and unrealized
gains (losses)                         23,151            (7,976)           (8,293)                 -              6,882
Plus: Intangibles amortization (1)     12,146                 -                 -                  -             12,146
Plus: Stock-based compensation
expense                                 2,376                 -                98              5,437              7,911
Plus: Non-recurring expenses            1,561                 -              (869)             2,108              2,800
Plus: Non-cash fair value
adjustments                                 -                 -             3,554                  -              3,554
Less: Tax on adjustments (2)           (7,299)            1,984             1,783             21,629             18,097
Adjusted net income                 $  59,893          $ (3,516)         $ 13,272          $ (20,816)         $  48,833

Adjusted net income                 $  59,893          $ (3,516)         $ 13,272          $ (20,816)         $  48,833
Average stockholders' equity        $ 309,042          $ 58,558          $ 94,169          $  (1,891)         $ 459,878
Adjusted return on average equity        25.8  %           (8.0) %           18.8  %                NM%            14.2  %



                                                             Nine Months Ended September 30, 2021
                                                              Tiptree Capital
($ in thousands)                     Insurance          Mortgage            Other            Corporate            Total

Income (loss) before taxes $ 49,569 $ 25,119 $ 12,914 $ (33,151) $ 54,451
Less: Income tax (benefit) expense (11,157)

           (4,448)            (1,350)             5,539            (11,416)
Less: Net realized and unrealized
gains (losses)                         (5,004)           (5,075)            (3,512)                 -            (13,591)
Plus: Intangibles amortization (1)     11,499                 -                  -                  -             11,499
Plus: Stock-based compensation
expense                                 1,347               331                209              1,831              3,718
Plus: Non-recurring expenses            2,076                 -                729              2,171              4,976
Plus: Non-cash fair value
adjustments                                 -                 -             (2,167)                 -             (2,167)
Less: Tax on adjustments (2)           (1,930)             (442)             1,330                582               (460)
Adjusted net income                 $  46,400          $ 15,485          $   8,153          $ (23,028)         $  47,010

Adjusted net income                 $  46,400          $ 15,485          $   8,153          $ (23,028)         $  47,010
Average stockholders' equity        $ 296,125          $ 62,093          $ 110,818          $ (81,196)         $ 387,840
Adjusted return on average equity        20.9  %           33.3  %             9.8  %                NM%            16.2  %

The footnotes below correspond to the tables above, under "-Adjusted Net Income
- Non-GAAP and "-Adjusted Return on Average Equity - Non-GAAP".

(1) Specifically associated with acquisition purchase accounting. See Note (9)
Goodwill and Intangible Assets, net.
(2) Tax on adjustments represents the tax applied to the total non-GAAP
adjustments and includes adjustments for non-recurring or discrete tax impacts.
For the three and nine months ended September 30, 2022, included in the
adjustment is an add-back of $(1.4) million and $24.1 million, respectively,
related to deferred tax expense from the WP Transaction.


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Adjusted EBITDA - Non-GAAP

The Company defines Adjusted EBITDA as GAAP net income of the Company plus
corporate interest expense, plus income taxes, plus depreciation and
amortization expense, less the effects of purchase accounting, plus non-cash
fair value adjustments, plus significant non-recurring expenses, and plus
unrealized gains (losses) on available for sale securities reported in other
comprehensive income. Adjusted EBITDA is used to determine incentive
compensation for the Company's executive officers. Adjusted EBITDA is not a
measurement of financial performance or liquidity under GAAP and should not be
considered as an alternative or substitute for GAAP net income.
                                                      Three Months Ended                    Nine Months Ended
($ in thousands)                                         September 30,                        September 30,
                                                    2022               2021               2022              2021
Net income (loss) attributable to common
stockholders                                    $   14,223          $  2,008          $  (9,145)         $ 38,558
Add: net (loss) income attributable to
non-controlling interests                            5,834             1,339              6,588             4,477

Corporate debt related interest expense(1)           3,592             6,038             15,559            18,402
Consolidated provision (benefit) for income
taxes                                                5,068               237             31,537            11,416
Depreciation and amortization                        5,549             6,119             17,714            18,261
Non-cash fair value adjustments(2)                    (542)           (1,835)               759            (5,651)
Non-recurring expenses(3)                              142               420              2,800             4,976

Other comprehensive income (loss), pre-tax (25,279) (1,970)

           (70,727)           (5,845)
Warburg gain to book value(4)                            -                 -             54,013                 -
Third party non-controlling interests(5)               317                                  317
Adjusted EBITDA                                 $    8,904          $ 12,356          $  49,415          $ 84,594

(1) Corporate debt interest expense includes interest expense from secured corporate credit

agreements, junior subordinated notes and preferred trust securities. Interest expense

associated with asset-specific debt is not added-back for Adjusted EBITDA.
(2) For maritime transportation operations, depreciation and amortization is deducted as a

reduction in the value of the vessel.
(3) Acquisition, start-up and disposition costs, including debt extinguishment, legal,

taxes, banker fees and other costs.
(4) The pre-tax gain recorded directly to Tiptree Inc. stockholders' equity was included in

Adjusted EBITDA, net of add-backs included in prior period Adjusted EBITDA.
(5) Adjusts for the comprehensive income (loss) (including EBITDA and AOCI impacts) for the

      non-controlling interests of The Fortegra Group.

Book Value per share - Non-GAAP

Management believes the use of this financial measure provides supplemental
information useful to investors as book value is frequently used by the
financial community to analyze company growth on a relative per share basis. The
following table provides a reconciliation between total stockholders' equity and
total shares outstanding, net of treasury shares.

 ($ in thousands, except per share information)                    As of September 30,
                                                                   2022           2021
Total stockholders' equity                                     $  519,574      $ 402,142
Less: Non-controlling interests                                   132,295   

16,930

Total stockholders' equity, net of non-controlling interests $ 387,279

$ 385,212

Total common shares outstanding                                    36,247         33,889

Book value per share                                           $    10.68      $   11.37

LIQUIDITY AND CAPITAL RESOURCES

Our principal sources of liquidity are unrestricted cash, cash equivalents and
other liquid investments and distributions from operating subsidiaries,
including income from our investment portfolio and sales of assets and
investments. We intend to use our cash resources to continue to fund our
operations and grow our businesses. We may seek additional sources of cash to
fund acquisitions or investments. These additional sources of cash may take the
form of debt or equity and may be at the parent, subsidiary or asset level. We
are a holding company and our liquidity needs are primarily for compensation,
professional fees, office rent and insurance costs.

Our subsidiaries' ability to generate sufficient net income and cash flows to
make cash distributions will be subject to numerous business and other factors,
including restrictions contained in agreements for the strategic investment by
Warburg in Fortegra, our subsidiaries' financing agreements, regulatory
restrictions, availability of sufficient funds at such subsidiaries, general
economic and business conditions, tax considerations, strategic plans, financial
results and other factors such as target capital ratios and ratio levels
anticipated by rating agencies to maintain or improve current ratings. We expect
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our cash and cash equivalents and distributions from operating subsidiaries, our
subsidiaries' access to financing, and sales of investments to be adequate to
fund our operations for at least the next 12 months, as well as the long term.

As of September 30, 2022, cash and cash equivalents, excluding restricted cash,
were $503.5 million, compared to $175.7 million at December 31, 2021, an
increase of $327.8 million primarily as a result of the WP Transaction, growth
in gross written premium and premium equivalents at Fortegra, sales and
maturities of investments within Fortegra and the sale of three dry bulk vessels
in our maritime transportation business.

Our mortgage business relies on short term uncommitted sources of financing as a
part of their normal course of operations. To date, we have been able to obtain
and renew uncommitted warehouse credit facilities. If we were not able to obtain
financing, then we may need to draw on other sources of liquidity to fund our
mortgage business. See Note (11) Debt, net in the notes to condensed
consolidated financial statements, for additional information regarding our
mortgage warehouse borrowings.

We believe that cash flow from operations will provide sufficient capital to
continue to grow the business and fund interest on the outstanding debt, capital
expenditures and other general corporate needs over the next several years. As
we continue to expand our business, including by any acquisitions we may make,
we may, in the future, require additional working capital for increased costs.

For purposes of determining enterprise value and Adjusted EBITDA, we consider
corporate credit agreements and preferred trust securities, which we refer to as
corporate debt, as corporate financing and associated interest expense is added
back. The below table outlines this amount by debt outstanding and interest
expense at the insurance company and corporate level.

Corporate Debt

                                                                   Interest Expense for
                               Corporate Debt Outstanding         the three months ended          Interest Expense for the
($ in thousands)                  as of September 30,                 September 30,            nine months ended September 30,
                                2022                  2021                      2022               2021               2022              2021
Insurance                 $      160,000          $ 161,740                  $  3,592          $    3,485          $ 10,944          $ 10,727
Corporate                              -            115,625                         -               2,553             4,615             7,675
Total                     $      160,000          $ 277,365                  $  3,592          $    6,038          $ 15,559          $ 18,402

The balance of the corporate credit facility was repaid during June 2022 as part
of the WP Transaction. See Note (11) Debt, net in the notes to condensed
consolidated financial statements for details for prior periods.

On October 21, 2022, Fortegra Financial Corporation ("FFC") entered into a
Second Amended and Restated Credit Agreement by and among FFC, its parent,
Fortegra, and its subsidiary, LOTS Intermediate Co., as borrowers, the lenders
from time to time party thereto, certain of Fortegra's affiliates as guarantors,
and Fifth Third Bank, National Association, as the administrative agent and
issuing lender (the "Fortegra Credit Agreement"). The Fortegra Credit Agreement
provides for a $200 million revolving credit facility, all of which is available
for the issuance of letters of credit, with a sub-limit of $25 million for swing
loans and matures on October 21, 2027.