0002007596-24-000008 | 10-Q | XBRL Viewer

OPERATING LEASES - Schedule Of Lease Costs And Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Leases [Abstract]
Operating lease costs reported in Other administrative expenses	$ 268	$ 182	$ 526	$ 330
Short-term operating lease costs reported in Other administrative expenses	38	3	73	10
Total lease costs	$ 306	$ 185	$ 599	$ 340
Weighted average remaining lease term (in years)	3 years 2 months 12 days	3 years 9 months 18 days	3 years 2 months 12 days	3 years 9 months 18 days
Weighted average discount rate	2.42%	2.80%	2.42%	2.80%
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows used in operating leases reported in Change in operating lease liabilities	$ 275	$ 190	$ 549	$ 346
Operating lease non-cash items:
Non-cash right-of-use assets obtained in exchange for new operating lease liabilities	$ 41	$ 504	$ 808	$ 526

Insider Trading Arrangements	3 Months Ended
Insider Trading Arrangements	Jun. 30, 2024
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

DERIVATIVES	6 Months Ended
DERIVATIVES	Jun. 30, 2024
Derivative Instruments and Hedging Activities Disclosure [Abstract]
DERIVATIVES	DERIVATIVES On July 30, 2019, and December 4, 2020, the Company entered into interest rate swap agreements to manage its exposure to interest rate fluctuations related to the Company’s term loans. At inception, the Company designated the interest rate swap agreements as cash flow hedges. As of June 30, 2024 and December 31, 2023, the interest rate swaps continue to be effective hedges. The original notional amount of the interest rate swaps as of both June 30, 2024 and December 31, 2023 was $17.0 million. The current notional amount of the interest rate swaps as of June 30, 2024 and December 31, 2023 was $7.0 million and $8.4 million, respectively. The fair value of the interest rate swaps as of both June 30, 2024 and December 31, 2023 was $0.5 million, which was included in Other non-current assets, except for the portion that relates to maturities within the next twelve months. The derivative assets fair value as of June 30, 2024 and December 31, 2023 was determined using the Level II inputs described in Note 2. The maturity dates for the interest rate swaps are July 30, 2024 and December 6, 2027, which correspond with the debt maturity dates. As of June 30, 2024, the Company expects $0.3 million of unrealized gains from the interest rate swaps to be reclassified into earnings over the next twelve months.

DEBT - Schedule of Debt (Details) - USD ($) $ in Thousands			6 Months Ended
DEBT - Schedule of Debt (Details) - USD ($) $ in Thousands	Dec. 04, 2020	Jul. 30, 2019	Jun. 30, 2024	Dec. 31, 2023
Debt Instrument [Line Items]
Total debt			$ 49,633	$ 50,737
Current maturities			(2,613)	(2,781)
Long-term debt			47,020	47,956
Notes Payable, Other Payables
Debt Instrument [Line Items]
Total debt			1,633	1,381
Term Loan
Debt Instrument [Line Items]
Total debt			$ 7,000	8,356
Term Loan \| Line of Credit \| 5-Year Term Loan
Debt Instrument [Line Items]
Term loan (in years)	7 years	5 years	5 years
Total debt			$ 147	584
Term Loan \| Line of Credit \| 7-Year Term Loan
Debt Instrument [Line Items]
Term loan (in years)			7 years
Total debt			$ 6,853	7,772
Term Loan \| Line of Credit \| Secured Overnight Financing Rate (SOFR), Adjustment \| 5-Year Term Loan
Debt Instrument [Line Items]
Interest rate			0.11448%
Term Loan \| Line of Credit \| Secured Overnight Financing Rate (SOFR), Adjustment \| 7-Year Term Loan
Debt Instrument [Line Items]
Interest rate			0.11448%
Revolving Credit Facility \| Line of Credit
Debt Instrument [Line Items]
Term loan (in years)			5 years
Total debt			$ 41,000	$ 41,000
Revolving Credit Facility \| Line of Credit \| Minimum
Debt Instrument [Line Items]
Commitment fee percent			0.20%
Revolving Credit Facility \| Line of Credit \| Maximum
Debt Instrument [Line Items]
Commitment fee percent			0.35%
Revolving Credit Facility \| Line of Credit \| Revolving Facility \| Minimum
Debt Instrument [Line Items]
Commitment fee percent			0.20%
Revolving Credit Facility \| Line of Credit \| Revolving Facility \| Maximum
Debt Instrument [Line Items]
Commitment fee percent			0.35%
Revolving Credit Facility \| Line of Credit \| Secured Overnight Financing Rate (SOFR), Adjustment
Debt Instrument [Line Items]
Interest rate			0.10%
Revolving Credit Facility \| Line of Credit \| Secured Overnight Financing Rate (SOFR) \| Minimum
Debt Instrument [Line Items]
Interest rate			2.00%
Revolving Credit Facility \| Line of Credit \| Secured Overnight Financing Rate (SOFR) \| Maximum
Debt Instrument [Line Items]
Interest rate			2.75%

REVENUES

6 Months Ended

Jun. 30, 2024

Revenue from Contract with Customer [Abstract]

REVENUES

The following table presents the disaggregation of revenues by major source (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Commission income	$	48,662	$	41,771	$	91,207	$	78,458
Contingent income	1,258		1,003		2,334		1,988
Fee income
Policy fees	933		521		1,446		1,076
Branch fees	1,220		843		2,351		1,310
License fees	444		660		959		1,535
TPA fees	92		184		165		315
Other income	657		394		1,117		550
Total revenues	$	53,266	$	45,376	$	99,579	$	85,232

The Company operates through two primary offerings, which are Insurance Services and TWFG MGA. The following table presents the disaggregation of revenues by offerings (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Insurance Services
Agency-in-a-box	$	34,589	$	35,145	$	66,418	$	66,644
Corporate Branches	9,351		1,568		16,627		2,504
TWFG MGA	8,884		7,953		15,723		14,879
Other	442		710		811		1,205
Total revenues	$	53,266	$	45,376	$	99,579	$	85,232

As of June 30, 2024 and December 31, 2023, the Commissions receivable reported in the Condensed Consolidated Statements of Financial Position had a balance of $22.4 million and $19.1 million, respectively, and had an opening balance of $15.0 million as of January 1, 2023. As of June 30, 2024, the aging of Commissions receivable is 62.7% for current, 10.6% for 31-60 days and the remainder is over 61 days. As of December 31, 2023, the aging of commissions receivable is 73.2% for current, 8.8% for 31-60 days and the remainder is over 61 days. The Company has no contract liabilities as of June 30, 2024, December 31, 2023, and January 1, 2023.

Other than The Progressive Corporation, which accounted for 13% and 12% of total revenues for the three and six months ended June 30, 2024, respectively, and 14% and 13% of total revenues for the three and six months ended June 30, 2023, respectively, no other customers individually accounted for 10% or more of the Company’s total revenues for the three and six months ended June 30, 2024 and 2023.

- Definition

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
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-Name Accounting Standards Codification
-Section 50
-Paragraph 9
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-URI https://asc.fasb.org/1943274/2147479806/606-10-50-9

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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Reference 10: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

Condensed Consolidated Statements of Comprehensive Income (Loss) (Parenthetical) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Statement of Comprehensive Income [Abstract]
Tax expense	$ 0	$ 0	$ 0	$ 44

OPERATING LEASES - Schedule Of Estimated Future Minimum Payments Of Operating Leases (Details) $ in Thousands	Jun. 30, 2024 USD ($)
Leases [Abstract]
Remainder of 2024	$ 554
2025	1,081
2026	779
2027	368
2028	167
2029	5
Total undiscounted future lease payments	2,954
Less: imputed interest	(284)
Present value of lease liabilities	$ 2,670

NET INCOME PER UNIT

6 Months Ended

Jun. 30, 2024

Earnings Per Share [Abstract]

NET INCOME PER UNIT

As discussed in Note 1, in May 2023, the Company amended and restated its limited liability company agreement, which resulted in the automatic exchange of all outstanding membership interests into three classes of membership interests. The economic interests of the unitholders before and after the unit exchange remained the same. As a result, to calculate the net income per unit, the Company retrospectively reflected the impact of the unit exchanges effective January 1, 2023. See Notes 1 and 2 for additional discussions regarding the unit exchange and the rights under each class.

The following table illustrates the computation of basic and diluted net income per unit (amounts in thousands, except units and per unit data):


	Three Months Ended June 30, 2024
	Basic						Diluted
	Class A		Class B		Class C		Class A		Class B		Class C
Net income	$	291	$	1,162	$	5,465	$	291	$	1,162	$	5,465
Weighted average units used in the computation of net income per unit	27,689		110,750		521,000		27,689		110,750		521,000
Net income per unit	$	10.49	$	10.49	$	10.49	$	10.49	$	10.49	$	10.49


	Three Months Ended June 30, 2023
	Basic						Diluted
	Class A		Class B		Class C		Class A		Class B		Class C
Net income	$	—	$	1,239	$	5,828	$	—	$	1,239	$	5,828
Weighted average units used in the computation of net income per unit	0		110,750		521,000		0		110,750		521,000
Net income per unit	$	—	$	11.19	$	11.19	$	—	$	11.19	$	11.19


	Six Months Ended June 30, 2024
	Basic						Diluted
	Class A		Class B		Class C		Class A		Class B		Class C
Net income	$	569	$	2,275	$	10,703	$	569	$	2,275	$	10,703
Weighted average units used in the computation of net income per unit	27,689		110,750		521,000		27,689		110,750		521,000
Net income per unit	$	20.54	$	20.54	$	20.54	$	20.54	$	20.54	$	20.54


	Six Months Ended June 30, 2023
	Basic						Diluted
	Class A		Class B		Class C		Class A		Class B		Class C
Net income from continuing operations	$	—	$	2,181	$	10,258	$	—	$	2,181	$	10,258
Weighted average units used in the computation of net income per unit	—		110,750		521,000		—		110,750		521,000
Net income from continuing operations per unit	$	—	$	19.69	$	19.69	$	—	$	19.69	$	19.69

Net loss from discontinued operation, net of tax	$	—	$	146	$	688	$	—	$	146	$	688
Weighted average units used in the computation of net income per unit	—		110,750		521,000		—		110,750		521,000
Net loss from discontinued operation per unit	$	—	$	1.32	$	1.32	$	—	$	1.32	$	1.32

Net income	$	—	$	2,327	$	10,946	$	—	$	2,327	$	10,946
Weighted average units used in the computation of net income per unit	—		110,750		521,000		—		110,750		521,000
Net income per unit	$	—	$	21.01	$	21.01	$	—	$	21.01	$	21.01

DEFINED CONTRIBUTION PLAN	6 Months Ended
DEFINED CONTRIBUTION PLAN	Jun. 30, 2024
Retirement Benefits [Abstract]
DEFINED CONTRIBUTION PLAN	DEFINED CONTRIBUTION PLAN TWFG Holding sponsors a Safe Harbor defined contribution pension plan (“the Plan”). The sponsor is part of a controlled group that includes both TWFG-IS and TWFG-GA. The Plan allows employees who are age 21 or older and have completed 3 months of service to participate. Each year, participants may defer between 1% and 100% of eligible compensation, not to exceed the maximum dollar amount as allowed under Section 402(g) of the Internal Revenue Code. Effective January 1, 2008, the Plan was amended to allow the Company to meet the provisions of the regulations. The Plan provides a Company matching of 100% on the first 4% of eligible compensation that a participant contributes to the Plan. For the three and six months ended June 30, 2024, the Company recognized expenses related to the Plan of $0.2 million and $0.3 million, respectively. For the three and six months ended June 30, 2023, the Company recognized expenses related to the Plan of $0.1 million and $0.2 million, respectively. The Company at its election may make discretionary profit share contributions. Contributions are subject to certain limitations. For the three and six months ended June 30, 2024 and 2023, the Company elected not to make any additional discretionary contributions.

INTANGIBLE ASSETS - Narrative (Details) $ in Thousands	1 Months Ended					6 Months Ended	12 Months Ended
INTANGIBLE ASSETS - Narrative (Details) $ in Thousands	Jan. 31, 2024 USD ($) independentBranch shares	Dec. 31, 2023 USD ($)	Oct. 31, 2023 USD ($)	May 31, 2023 USD ($)	Apr. 30, 2023 USD ($)	Jun. 30, 2024 USD ($)	Dec. 31, 2023 USD ($)	May 01, 2023 USD ($)
Finite-Lived Intangible Assets [Line Items]
Increase in customer lists intangible assets						$ 47,209	$ 21,807
Number of branches acquired \| independentBranch	9
Ralph E. Wade Insurance Agency Inc.
Finite-Lived Intangible Assets [Line Items]
Interest in the asset purchased (as percent)								10.90%
Consideration amount								$ 500
Customer Lists
Finite-Lived Intangible Assets [Line Items]
Increase in customer lists intangible assets						46,765	20,678
Ralph E. Wade Insurance Agency Inc. \| Customer Lists
Finite-Lived Intangible Assets [Line Items]
Increase in customer lists intangible assets					$ 4,300
Jim Kelly Insurance Agency Inc.
Finite-Lived Intangible Assets [Line Items]
Asset purchased (as percent)				50.10%
Total purchase price	$ 5,200
Jim Kelly Insurance Agency Inc. \| Customer Lists
Finite-Lived Intangible Assets [Line Items]
Increase in customer lists intangible assets				$ 1,100
Luczkowski Insurance Agency Inc.
Finite-Lived Intangible Assets [Line Items]
Asset purchased (as percent)				50.10%
Total purchase price	5,200
Luczkowski Insurance Agency Inc. \| Customer Lists
Finite-Lived Intangible Assets [Line Items]
Increase in customer lists intangible assets				$ 600
Jeff Kincaid Insurance Agency, Inc. \| Customer Lists
Finite-Lived Intangible Assets [Line Items]
Increase in customer lists intangible assets			$ 11,800
Brinson, Inc. \| Customer Lists
Finite-Lived Intangible Assets [Line Items]
Increase in customer lists intangible assets		$ 2,000
Additional Acquisitions
Finite-Lived Intangible Assets [Line Items]
Total revenues						500
Additional Acquisitions \| Customer Lists
Finite-Lived Intangible Assets [Line Items]
Increase in customer lists intangible assets						$ 800	$ 900
American Insurance Strategies, LLC
Finite-Lived Intangible Assets [Line Items]
Total purchase price	$ 5,200
Brinson, Inc. And Jeff Kincaid Insurance Agency, Inc \| Class A
Finite-Lived Intangible Assets [Line Items]
Settlement of class A common unit (in shares) \| shares	4,164
Series of Individually Immaterial Asset Acquisitions
Finite-Lived Intangible Assets [Line Items]
Total purchase price	$ 20,400
Series of Individually Immaterial Asset Acquisitions \| Customer Lists
Finite-Lived Intangible Assets [Line Items]
Increase in customer lists intangible assets	$ 40,800

DEFINED CONTRIBUTION PLAN (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
DEFINED CONTRIBUTION PLAN (Details) - USD ($) $ in Millions	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Defined Benefit Plan Disclosure [Line Items]
Defined contribution plan, requisite service period (in months)			3 months
Defined contribution plan, employer matching contribution, percent of match			100.00%
Defined contribution plan, employer matching contribution, percent of employees' gross pay			4.00%
Defined contribution plan, cost	$ 0.2	$ 0.1	$ 0.3	$ 0.2
Minimum
Defined Benefit Plan Disclosure [Line Items]
Defined contribution plan, eligible compensation for deferral (percent)			1.00%
Maximum
Defined Benefit Plan Disclosure [Line Items]
Defined contribution plan, eligible compensation for deferral (percent)			100.00%

DEBT (Tables)

6 Months Ended

Jun. 30, 2024

Debt Disclosure [Abstract]

Schedule of Debt

The following is a summary of the Company’s outstanding debt (in thousands):


	June 30, 2024		December 31, 2023
Term Loans
5-year term loan, periodic interest and monthly principal payments, Daily Simple SOFR + 0.11448% SOFR adjustment, matures July 30, 2024	$	147	$	584
7-year term loan, periodic interest and monthly principal payments, Daily Simple SOFR + 0.11448% SOFR adjustment, matures December 6, 2027	6,853		7,772
Total term loans	7,000		8,356
Revolving Facility
5-year revolving credit facility, periodic interest payments, Term SOFR + 0.10% SOFR adjustment + 2% up to 2.75% applicable margin based on the consolidated leverage ratio, plus commitment fees of 0.20% up to 0.35% based on the consolidated leverage ratio, matures May 23, 2028	41,000		41,000
Deferred acquisition payable	1,633		1,381
Total debt	49,633		50,737
Current maturities	(2,613)		(2,781)
Long-term debt	$	47,020	$	47,956

Schedule of Maturities of Long-Term Debt

Future maturities of the Company’s outstanding debt as of June 30, 2024, were as follows (in thousands):


Remainder of 2024	$	1,412
2025	2,416
2026	2,473
2027	2,209
2028	41,063
Thereafter	60
Total	$	49,633

DISCONTINUED OPERATION (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
DISCONTINUED OPERATION (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Discontinued Operations and Disposal Groups [Abstract]
Revenue	$ 0	$ 0	$ 0	$ 1,240
Less: Operating expenses	0	0	0	450
Operating income	0	0	0	790
Less: Income tax benefit	0	0	0	(44)
Net income from discontinued operation, net of tax	$ 0	$ 0	$ 0	$ 834

- Definition

Amount of tax expense (benefit) related to a discontinued operation. Includes, but is not limited to, tax expense (benefit) related to income (loss) from operations during the phase-out period, tax expense (benefit) related to gain (loss) on disposal, tax expense (benefit) related to gain (loss) for reversal of write-down (write-down) to fair value, less cost to sell, and tax expense (benefit) related to adjustments of a prior period gain (loss) on disposal.

+ References

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+ Details

- Definition

Amount after tax of income (loss) from a discontinued operation including the portion attributable to the noncontrolling interest. Includes, but is not limited to, the income (loss) from operations during the phase-out period, gain (loss) on disposal, gain (loss) for reversal of write-down (write-down) to fair value, less cost to sell, and adjustments to a prior period gain (loss) on disposal.

+ References

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+ Details

REVENUES - Narrative (Details)	3 Months Ended		6 Months Ended
REVENUES - Narrative (Details)	Jun. 30, 2024 USD ($)	Jun. 30, 2023	Jun. 30, 2024 USD ($) offering	Jun. 30, 2023	Dec. 31, 2023 USD ($)	Jan. 01, 2023 USD ($)
Disaggregation of Revenue [Line Items]
Number of primary offerings \| offering			2
Commissions receivable, net	$ 22,401,000		$ 22,401,000		$ 19,082,000	$ 15,000,000.0
Contract with customer, liability	$ 0		$ 0		$ 0	$ 0
Revenue from Contract with Customer Benchmark \| Customer Concentration Risk \| The Progressive Corporation
Disaggregation of Revenue [Line Items]
Concentration risk (in percent)	13.00%	14.00%	12.00%	13.00%
Financial Asset, Not Past Due
Disaggregation of Revenue [Line Items]
Contract with customer, liability, commissions receivable (in percent)	62.70%		62.70%		73.20%
Financial Asset, 31 To 60 Days Past Due
Disaggregation of Revenue [Line Items]
Contract with customer, liability, commission receivable current (in percent)	10.60%		10.60%		8.80%

ORGANIZATION AND BASIS OF PRESENTATION	6 Months Ended
ORGANIZATION AND BASIS OF PRESENTATION	Jun. 30, 2024
Organization, Consolidation and Presentation of Financial Statements [Abstract]
ORGANIZATION AND BASIS OF PRESENTATION	ORGANIZATION AND BASIS OF PRESENTATION Organization On January 8, 2024, TWFG, Inc. was incorporated as a Delaware corporation for the purpose of completing an initial public offering (“IPO”) and to carry on the business of TWFG Holding Company, LLC and its consolidated subsidiaries (collectively “TWFG Holding” or the “Company”). The operations of TWFG Holding represent the predecessor to TWFG, Inc. prior to the IPO, and the consolidated subsidiaries of TWFG Holding are described in more detail below. TWFG Holding is an independent distribution platform for personal and commercial insurance in the United States. TWFG Holding was incorporated in October 2000 under the name RFB Interests, Inc. On March 23, 2018, RFB Interest, Inc. was converted to a limited liability company and its name was changed to TWFG Holding. Prior to March 2018, TWFG Holding was 100% owned by Bunch Family Holdings, LLC (“Bunch Holdings”). In March 2018, TWFG Holding sold a 17.5% ownership interest to RenaissanceRe Ventures U.S. LLC (“RenRe”), a Delaware limited liability company. In August 2021, RenRe sold 4.4% of its ownership interest in TWFG Holding to GHC Woodlands Holdings LLC (“GHC” and collectively with Bunch Holdings, RenRe and TWFG, together with each of their permitted transferees, the “Pre-IPO LLC Members”). In May 2023 (the “Effective Date”), the Company amended and restated its limited liability company agreement (“A&R LLC Agreement”) and created three classes of membership interests — Class A common units with one vote per unit, Class B common units with one vote per unit and Class C common units with 10 votes per unit. As of the Effective Date, the original common units were automatically exchanged as follows: •The 82.5% ownership interest of Bunch Holdings was automatically exchanged into 100% ownership of the Class C common units issued and outstanding, representing 82.5% ownership interest and 97.9% voting power. •The 13.1% ownership interest of RenRe was automatically exchanged into 75% ownership of the Class B common units issued and outstanding, representing 13.1% ownership interest and 1.6% voting power. •The 4.4% ownership interest of GHC was automatically exchanged into 25% ownership of the Class B common units issued and outstanding, representing 4.4% ownership interest and 0.5% voting power. The economic interests of the unitholders before and after the unit exchange remained the same. Bunch Holdings is the ultimate controlling owner of TWFG Holding. On January 1, 2024, the Company issued a total of 27,689 new Class A common units to separate individuals and entities (collectively “New Owners”) in connection with separate asset purchase agreements. See Note 4 for more information about the asset purchases. Following the issuance of the new units, the ownership and voting power of the Company were as follows: •Bunch Holdings held 521,000 Class C common units, representing 79.0% ownership interest and 97.4% voting power. •RenRe held 83,050 Class B common units, representing 12.6% ownership interest and 1.6% voting power. •GHC held 27,700 Class B common units, representing 4.2% ownership interest and 0.5% voting power. •New Owners collectively held 27,689 Class A common units, representing 4.2% ownership interest and 0.5% voting power. The Company’s corporate headquarters is in The Woodlands, Texas. TWFG Holding is the parent company of the following wholly-owned subsidiaries: TWFG Insurance Services LLC (“TWFG-IS”) is a national retail insurance agency that distributes personal lines, commercial lines, life, annuities, health, and supplemental benefits insurance products. TWFG General Agency LLC (“TWFG-GA”) is a Managing General Agency that distributes personal and commercial lines insurance products to independent agents, in addition to TWFG-IS agents. TWFG Premium Finance LLC (“TWFG-PF”) is an intermediary insurance premium financing company that offers premium financing for commercial insurance policies for clients of TWFG-GA and TWFG-IS. TWFG CA Premium Finance Company (“TWFG-CA PF”) is an intermediary insurance premium financing company that offers premium financing for personal and commercial insurance clients that purchase insurance from licensed California insurance agents. This entity was formed in 2022. PSN Business Processing Inc. (“PSN”) is a Philippine corporation with its principal office located in the Philippines. PSN is engaged in the business of providing back-office support to TWFG agents and the TWFG corporate office, specifically insurance-related and various administrative services. Evolution Agency Management LLC (“EVO”) is a software services company that offers agents complete agency management systems solutions. In May 2023, the Company distributed its equity interest in EVO to the owners of the Company. The distribution of EVO did not meet the criteria for discontinued operation reporting. The Woodlands Insurance Company (“TWICO”) is a Texas domiciled insurance company, formed in 2014, which currently writes homeowner’s policies. TWICO is licensed in Texas and Louisiana. In 2023, the Company distributed its equity interest in TWICO to the owners of the Company. The Company has presented TWICO as a discontinued operation in these condensed consolidated financial statements. See Note 11 for additional information about the discontinued operation. Basis of Presentation The condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and include the accounts of TWFG Holding and its subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. In the opinion of management, the condensed consolidated financial statements include all normal recurring adjustments necessary to present fairly the Company’s condensed consolidated financial position, results of operations, and cash flows for all periods presented. Certain prior period amounts have been reclassified to conform with the current period presentation. The Company is an emerging growth company and has elected to avail itself of the extended transition period for complying with new or revised accounting standards. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of intangible assets, lease right-of-use assets and operating lease liabilities as of the date of the financial statements and commission income and contingent income during the reporting period. Actual results could differ from those estimates as more information becomes known.

REVENUES (Tables)

6 Months Ended

Jun. 30, 2024

Revenue from Contract with Customer [Abstract]

Schedule of Disaggregation of Revenue

The following table presents the disaggregation of revenues by major source (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Commission income	$	48,662	$	41,771	$	91,207	$	78,458
Contingent income	1,258		1,003		2,334		1,988
Fee income
Policy fees	933		521		1,446		1,076
Branch fees	1,220		843		2,351		1,310
License fees	444		660		959		1,535
TPA fees	92		184		165		315
Other income	657		394		1,117		550
Total revenues	$	53,266	$	45,376	$	99,579	$	85,232

The Company operates through two primary offerings, which are Insurance Services and TWFG MGA. The following table presents the disaggregation of revenues by offerings (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Insurance Services
Agency-in-a-box	$	34,589	$	35,145	$	66,418	$	66,644
Corporate Branches	9,351		1,568		16,627		2,504
TWFG MGA	8,884		7,953		15,723		14,879
Other	442		710		811		1,205
Total revenues	$	53,266	$	45,376	$	99,579	$	85,232

DISCONTINUED OPERATION (Tables)

6 Months Ended

Jun. 30, 2024

Discontinued Operations and Disposal Groups [Abstract]

Schedule of Reconciliation of the Amounts of Major Classes of Income from Operations

The following is a reconciliation of the amounts of major classes of income from operations classified as discontinued operation in the Consolidated Statement of Operations (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Revenue	$	—	$	—	$	—	$	1,240
Less: Operating expenses	—		—		—		450
Operating income	—		—		—		790
Less: Income tax benefit	—		—		—		(44)
Net income from discontinued operation, net of tax	$	—	$	—	$	—	$	834

- Definition

Tabular disclosure of information related to a disposal group. Includes, but is not limited to, a discontinued operation, disposal classified as held-for-sale or disposed of by means other than sale or disposal of an individually significant component.

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+ Details

RELATED PARTY TRANSACTIONS (Details) - USD ($) $ in Thousands	1 Months Ended					3 Months Ended		6 Months Ended		12 Months Ended
	Jan. 31, 2024	Dec. 31, 2023	Oct. 31, 2023	May 31, 2023	Apr. 30, 2023	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023	Dec. 31, 2023	Apr. 30, 2024	May 01, 2023
Related Party Transaction [Line Items]
Total revenues						$ 53,266	$ 45,376	$ 99,579	$ 85,232
Additions								47,209		$ 21,807
Commission income
Related Party Transaction [Line Items]
Total revenues						48,662	41,771	91,207	78,458
Customer Lists
Related Party Transaction [Line Items]
Additions								46,765		$ 20,678
Ralph E. Wade Insurance Agency Inc.
Related Party Transaction [Line Items]
Cash paid					$ 3,000
Ralph E. Wade Insurance Agency Inc. \| Acquisition Related Notes \| Notes Payable, Other Payables
Related Party Transaction [Line Items]
Term loan (in years)					3 years
Ralph E. Wade Insurance Agency Inc. \| Customer Lists
Related Party Transaction [Line Items]
Additions					$ 4,300
Jim Kelly Insurance Agency Inc.
Related Party Transaction [Line Items]
Total purchase price	$ 5,200
Jim Kelly Insurance Agency Inc. \| Customer Lists
Related Party Transaction [Line Items]
Additions				$ 1,100
American Insurance Strategies, LLC
Related Party Transaction [Line Items]
Total purchase price	5,200
Luczkowski Insurance Agency Inc.
Related Party Transaction [Line Items]
Total purchase price	5,200
Luczkowski Insurance Agency Inc. \| Customer Lists
Related Party Transaction [Line Items]
Additions				$ 600
Jeff Kincaid Insurance Agency, Inc. \| Customer Lists
Related Party Transaction [Line Items]
Additions			$ 11,800
Brinson, Inc. \| Customer Lists
Related Party Transaction [Line Items]
Additions		$ 2,000
Related Party
Related Party Transaction [Line Items]
General and administrative expense						1,200	1,000	2,200	2,000
Total revenues						1,912	947	3,021
Related Party \| Commission income
Related Party Transaction [Line Items]
Total revenues									1,897
Related Party \| TWICO
Related Party Transaction [Line Items]
Fee income						500	400	900	800
Related Party \| TWICO \| Commission income
Related Party Transaction [Line Items]
Total revenues						1,900	900	3,000	1,900
Related Party \| Jeff Kincaid Insurance Agency, Inc.
Related Party Transaction [Line Items]
Cash paid			8,200
Related Party \| Jeff Kincaid Insurance Agency, Inc. \| Class A
Related Party Transaction [Line Items]
Equity interest issued, value	3,500
Related Party \| Brinson, Inc.
Related Party Transaction [Line Items]
Cash paid		500
Related Party \| Brinson, Inc. \| Class A
Related Party Transaction [Line Items]
Equity interest issued, value	1,000
Related Party \| Ralph E. Wade Insurance Agency Inc.
Related Party Transaction [Line Items]
Cash paid					3,000
Asset acquisition, debt issuance					$ 1,300
Interest in the asset purchased (as percent)												10.90%
Consideration amount												$ 500
Related Party \| Ralph E. Wade Insurance Agency Inc. \| Ralph E. Wade Insurance Agency Inc.
Related Party Transaction [Line Items]
Ownership percentage											70.00%	76.90%
Related Party \| Ralph E. Wade Insurance Agency Inc. \| Acquisition Related Notes \| Notes Payable, Other Payables
Related Party Transaction [Line Items]
Term loan (in years)					3 years
Related Party \| Ralph E. Wade Insurance Agency Inc. \| Customer Lists
Related Party Transaction [Line Items]
Additions					$ 4,300
Related Party \| Jim Kelly Insurance Agency Inc.
Related Party Transaction [Line Items]
Total purchase price	5,200
Related Party \| American Insurance Strategies, LLC
Related Party Transaction [Line Items]
Total purchase price	5,200
Related Party \| Luczkowski Insurance Agency Inc.
Related Party Transaction [Line Items]
Total purchase price	$ 5,200
Related Party \| Jeff Kincaid Insurance Agency, Inc. \| Customer Lists
Related Party Transaction [Line Items]
Additions			$ 11,800
Related Party \| Brinson, Inc. \| Customer Lists
Related Party Transaction [Line Items]
Additions		$ 2,000
Related Party \| Evolution Agency Management LLC
Related Party Transaction [Line Items]
General and administrative expense						80	80	100	80
License fees						$ 400	$ 200	$ 900	$ 200

REVENUES - Schedule of Disaggregation of Revenues by Offerings (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Disaggregation of Revenue [Line Items]
Total revenues	$ 53,266	$ 45,376	$ 99,579	$ 85,232
Agency-in-a-box
Disaggregation of Revenue [Line Items]
Total revenues	34,589	35,145	66,418	66,644
Corporate Branches
Disaggregation of Revenue [Line Items]
Total revenues	9,351	1,568	16,627	2,504
TWFG MGA
Disaggregation of Revenue [Line Items]
Total revenues	8,884	7,953	15,723	14,879
Other
Disaggregation of Revenue [Line Items]
Total revenues	$ 442	$ 710	$ 811	$ 1,205

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References + Details

- Definition

Amount, excluding tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value added and excise.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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-Paragraph 41
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+ Details

Condensed Consolidated Statements of Operations - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Revenues
Total revenues	$ 53,266	$ 45,376	$ 99,579	$ 85,232
Expenses
Commission expense	31,962	30,896	58,405	58,392
Salaries and employee benefits	6,816	3,370	13,070	6,706
Other administrative expenses (related party of $382 and $99 for the three months ended and $783 and $92 for the six months ended June 30, 2024 and 2023, respectively)	3,744	2,736	6,874	5,231
Depreciation and amortization	2,968	1,134	5,981	2,195
Total operating expenses	45,490	38,136	84,330	72,524
Operating income	7,776	7,240	15,249	12,708
Interest expense	(872)	(173)	(1,714)	(258)
Other non-operating income (expense), net	14	0	12	(11)
Net income from continuing operations	6,918	7,067	13,547	12,439
Net income from discontinued operation, net of tax	0	0	0	834
Net income	$ 6,918	$ 7,067	$ 13,547	$ 13,273
Weighted average units used in the computation of net income per unit (see Note 10):
Basic (in shares)	659,439	631,750	659,439	631,750
Diluted (in shares)	659,439	631,750	659,439	631,750
Net income per unit:
Net income from continuing operations per unit - basic (us dollar per share)	$ 10.49	$ 11.19	$ 20.54	$ 19.69
Net income from continuing operations per unit - diluted (us dollar per share)	10.49	11.19	20.54	19.69
Net income from discontinued operation per unit - basic (us dollar per share)	0	0	0	1.32
Net income from discontinued operation per unit - diluted (us dollar per share)	0	0	0	1.32
Net income per unit - basic (us dollar per share)	10.49	11.19	20.54	21.01
Net income per unit - diluted (us dollar per share)	$ 10.49	$ 11.19	$ 20.54	$ 21.01
Commission income
Revenues
Total revenues	$ 48,662	$ 41,771	$ 91,207	$ 78,458
Contingent income
Revenues
Total revenues	1,258	1,003	2,334	1,988
Fee Income
Revenues
Total revenues	2,689	2,208	4,921	4,236
Other income
Revenues
Total revenues	$ 657	$ 394	$ 1,117	$ 550

REVENUES - Schedule of Disaggregation of Revenues by Major Source (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Disaggregation of Revenue [Line Items]
Total revenues	$ 53,266	$ 45,376	$ 99,579	$ 85,232
Commission income
Disaggregation of Revenue [Line Items]
Total revenues	48,662	41,771	91,207	78,458
Contingent income
Disaggregation of Revenue [Line Items]
Total revenues	1,258	1,003	2,334	1,988
Fee Income
Disaggregation of Revenue [Line Items]
Total revenues	2,689	2,208	4,921	4,236
Policy fees
Disaggregation of Revenue [Line Items]
Total revenues	933	521	1,446	1,076
Branch fees
Disaggregation of Revenue [Line Items]
Total revenues	1,220	843	2,351	1,310
License fees
Disaggregation of Revenue [Line Items]
Total revenues	444	660	959	1,535
TPA fees
Disaggregation of Revenue [Line Items]
Total revenues	92	184	165	315
Other income
Disaggregation of Revenue [Line Items]
Total revenues	$ 657	$ 394	$ 1,117	$ 550

OPERATING LEASES (Tables)

6 Months Ended

Jun. 30, 2024

Leases [Abstract]

Schedule of Lease Costs and Supplemental Cash Flow Information

The following table summarizes the Company’s lease costs and supplemental cash flow information related to its operating leases (dollar amounts in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024			2023
Operating lease costs reported in Other administrative expenses	$	268	$	182	$	526		$	330
Short-term operating lease costs reported in Other administrative expenses	38		3		73			10
Total lease costs	$	306	$	185	$	599		$	340

Weighted average remaining lease term (in years)					3.2			3.8
Weighted average discount rate					2.42		%	2.80		%

Supplemental cash flow information:
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows used in operating leases reported in Change in operating lease liabilities	$	275	$	190	$	549		$	346
Operating lease non-cash items:
Non-cash right-of-use assets obtained in exchange for new operating lease liabilities	$	41	$	504	$	808		$	526

Schedule of Estimated Future Minimum Payments of Operating Leases

The estimated future minimum payments of operating leases as of June 30, 2024 (in thousands):


Remainder of 2024	$	554
2025	1,081
2026	779
2027	368
2028	167
2029	5
Total undiscounted future lease payments	2,954
Less: imputed interest	(284)
Present value of lease liabilities	$	2,670

INTANGIBLE ASSETS - Schedule of Future Amortization For Intangible Assets (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Finite-Lived Intangible Assets [Line Items]
Net carrying amount, end of period	$ 77,794	$ 36,436
Customer Lists
Finite-Lived Intangible Assets [Line Items]
Remainder of 2024	5,342
2025	10,663
2026	10,606
2027	10,559
2028	10,523
Thereafter	27,979
Net carrying amount, end of period	75,672	34,218
Computer Software
Finite-Lived Intangible Assets [Line Items]
Remainder of 2024	457
2025	588
2026	478
2027	380
2028	193
Thereafter	15
Net carrying amount, end of period	2,111	2,174
Non-Compete Agreements
Finite-Lived Intangible Assets [Line Items]
Remainder of 2024	8
2025	3
2026	0
2027	0
2028	0
Thereafter	0
Net carrying amount, end of period	$ 11	$ 44

DERIVATIVES (Details) - Interest Rate Swap - Cash Flow Hedging - Designated as Hedging Instrument - USD ($) $ in Millions	Jun. 30, 2024	Dec. 31, 2023	Dec. 04, 2020	Jul. 30, 2019
Derivative [Line Items]
Notional amount	$ 7.0	$ 8.4	$ 17.0	$ 17.0
Unrealized gains from the interest rate swaps to be reclassified into earnings over the next twelve months	0.3
Other Noncurrent Assets
Derivative [Line Items]
Fair value of the interest rate swaps	$ 0.5	$ 0.5

NET INCOME PER UNIT (Tables)

6 Months Ended

Jun. 30, 2024

Earnings Per Share [Abstract]

Computation of Basic and Diluted Net Income Per Unit

The following table illustrates the computation of basic and diluted net income per unit (amounts in thousands, except units and per unit data):


	Three Months Ended June 30, 2024
	Basic						Diluted
	Class A		Class B		Class C		Class A		Class B		Class C
Net income	$	291	$	1,162	$	5,465	$	291	$	1,162	$	5,465
Weighted average units used in the computation of net income per unit	27,689		110,750		521,000		27,689		110,750		521,000
Net income per unit	$	10.49	$	10.49	$	10.49	$	10.49	$	10.49	$	10.49


	Three Months Ended June 30, 2023
	Basic						Diluted
	Class A		Class B		Class C		Class A		Class B		Class C
Net income	$	—	$	1,239	$	5,828	$	—	$	1,239	$	5,828
Weighted average units used in the computation of net income per unit	0		110,750		521,000		0		110,750		521,000
Net income per unit	$	—	$	11.19	$	11.19	$	—	$	11.19	$	11.19


	Six Months Ended June 30, 2024
	Basic						Diluted
	Class A		Class B		Class C		Class A		Class B		Class C
Net income	$	569	$	2,275	$	10,703	$	569	$	2,275	$	10,703
Weighted average units used in the computation of net income per unit	27,689		110,750		521,000		27,689		110,750		521,000
Net income per unit	$	20.54	$	20.54	$	20.54	$	20.54	$	20.54	$	20.54


	Six Months Ended June 30, 2023
	Basic						Diluted
	Class A		Class B		Class C		Class A		Class B		Class C
Net income from continuing operations	$	—	$	2,181	$	10,258	$	—	$	2,181	$	10,258
Weighted average units used in the computation of net income per unit	—		110,750		521,000		—		110,750		521,000
Net income from continuing operations per unit	$	—	$	19.69	$	19.69	$	—	$	19.69	$	19.69

Net loss from discontinued operation, net of tax	$	—	$	146	$	688	$	—	$	146	$	688
Weighted average units used in the computation of net income per unit	—		110,750		521,000		—		110,750		521,000
Net loss from discontinued operation per unit	$	—	$	1.32	$	1.32	$	—	$	1.32	$	1.32

Net income	$	—	$	2,327	$	10,946	$	—	$	2,327	$	10,946
Weighted average units used in the computation of net income per unit	—		110,750		521,000		—		110,750		521,000
Net income per unit	$	—	$	21.01	$	21.01	$	—	$	21.01	$	21.01

LITIGATION AND CONTINGENCIES	6 Months Ended
LITIGATION AND CONTINGENCIES	Jun. 30, 2024
Commitments and Contingencies Disclosure [Abstract]
LITIGATION AND CONTINGENCIES	LITIGATION AND CONTINGENCIES The Company is a party to various legal actions and claims, brought by or threatened against it, in the ordinary course of business. The Company records liabilities for loss contingencies when it is probable that a liability has been incurred and the amount is reasonably estimable. The Company does not discount such contingent liabilities and recognizes incremental costs related to the contingencies when incurred. In the opinion of management, the ultimate resolution of legal actions and pending claims will not materially affect the condensed consolidated financial statements of the Company.

RELATED PARTY TRANSACTIONS	6 Months Ended
RELATED PARTY TRANSACTIONS	Jun. 30, 2024
Related Party Transactions [Abstract]
RELATED PARTY TRANSACTIONS	RELATED PARTY TRANSACTIONS TWFG provides administration services to and pays expenses on behalf of its subsidiaries as part of its management agreement with its subsidiaries. These expenses are allocated to the subsidiaries based on the time expended by employees in each subsidiary. For the three and six months ended June 30, 2024, the Company allocated general and administrative expenses related to the continuing operations totaling $1.2 million and $2.2 million, respectively. For the three and six months ended June 30, 2023, the Company allocated general and administrative expenses related to the continuing operations totaling $1.0 million and $2.0 million, respectively. These amounts are eliminated in the Condensed Consolidated Statements of Operations. TWICO pays TWFG-GA commissions and fee income, i.e., policy fees and TPA fees, for business written through TWFG-GA. For the three and six months ended June 30, 2024, TWFG-GA earned $1.9 million and $3.0 million in commissions, respectively, and $0.5 million and $0.9 million in fee income, respectively, from TWICO. For the three and six months ended June 30, 2023, TWFG-GA earned $0.9 million and $1.9 million in commissions, respectively and $0.4 million and $0.8 million in fee income, respectively, from TWICO. These amounts are not eliminated and are included in commission income and fee income in the Condensed Consolidated Statements of Operations. In addition, TWFG Holding provides administration services to and pays expenses on behalf of TWICO as part of its management agreement with TWICO. For the three and six months ended June 30, 2024 and 2023, the Company allocated general and administrative expenses related to TWICO, which were immaterial. The offsetting expenses recognized by TWICO for one month in 2023 related to these commissions, policy, TPA fees and allocated general and administrative expenses are included in the net income from discontinued operation in the Condensed Consolidated Statements of Operations. As described in Note 1, in May 2023, the Company distributed its equity interest in EVO to the owners of the Company. As a result, the Company deconsolidated EVO effective on the distribution date. TWFG-IS and TWFG-GA have software licensing agreements with EVO, which allow TWFG-IS and TWFG-GA to use EVO’s proprietary agency management system in exchange for a fixed annual fee. In addition, TWFG Holding provides administration services to and pays expenses on behalf of EVO as part of its management agreement with EVO. Prior to the deconsolidation of EVO, charges between the Company and EVO were eliminated upon consolidation. For the three and six months ended June 30, 2024, the Company incurred $0.4 million and $0.9 million in license fees, respectively, and allocated general and administrative expenses related to EVO, totaling $0.08 million and $0.1 million, respectively. For both the three and six months ended June 30, 2023, the Company incurred $0.2 million in license fees, and allocated general and administrative expenses related to EVO, totaling $0.08 million. These amounts are not eliminated and are included in Other administrative expenses in the Condensed Consolidated Statements of Operations. As described in Note 4, the Company purchased the assets of Wade for a total consideration of $4.3 million, of which $3.0 million was paid in cash, and the remaining balance of $1.3 million, was settled through the issuance of an interest-bearing note, payable monthly, over three years beginning in April 2024. The portion of the balance due within 12 months or less from the financial statement date is reported in the Condensed Consolidated Statements of Financial Position as Deferred acquisition payable, current, while the amount due after 12 months from the financial statement date is included in Deferred acquisition payable, non-current. As described in Note 4, immediately following the asset purchase, the Company sold 10.9% interest in the asset purchased from Wade to AIS for a total consideration of $0.5 million. In connection with the Wade asset purchase, the branch agreement between TWFG-IS and AIS was amended to add Wade’s book of business into AIS, which changed to TWFG-IS ownership of the assets of AIS branch from 70% to 76.9%. As described in Note 4, the Company acquired interests in the operations and assets of AIS, Luczkowski and Kelly. All respective equity ownership with AIS, Luczkowski and Kelly following the respective asset purchases remained with the sellers, while TWFG-IS managed the ongoing operations of AIS, Luczkowski and Kelly. In January 2024, the Company acquired the remaining interests in the assets of AIS, Luczkowski, and Kelly for a total purchase price of $5.2 million, converting them to wholly owned corporate branches. The Company issued equity to settle the total purchase price. As described in Note 4, the Company purchased the assets of Kincaid and Brinson for a total consideration of $11.8 million and $2.0 million, respectively. Upon closing, the Company paid $8.2 million in cash for the Kincaid asset purchase and $0.5 million in cash for the Brinson asset purchase. The amount representing the unsettled portion of the total consideration as of December 31, 2023 was reported as Deferred acquisition payable, current in the Condensed Consolidated Statements of Financial Position. In January 2024, pursuant to the asset purchase agreements, the remaining balances of the total consideration associated with the Kincaid and Brinson asset purchases were settled through the issuance of the Company’s Class A common units, equivalent to $3.5 million for the Kincaid asset purchase, and the issuance of the Company’s Class A common units equivalent to $1.0 million and cash payment of $0.5 million for the Brinson asset purchase. RenaissanceRe Holdings Ltd., through its wholly-owned subsidiary RenaissanceRe Ventures U.S. LLC, has been an investor in the Company since 2018, and is represented on the Company’s Board of Managers. Griffin Highline Capital, LLC, through its wholly-owned subsidiary, GHC Woodlands Holdings LLC, has been an investor in the Company since 2021, and is represented on the Company’s Board of Managers.

- Definition

The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480990/946-20-50-2

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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-Paragraph 5
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147480990/946-20-50-5

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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-URI https://asc.fasb.org/1943274/2147480990/946-20-50-6

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147477968/946-235-50-2

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
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-Section 50
-Paragraph 2
-Subparagraph (e)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147477968/946-235-50-2

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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-Section 50
-Paragraph 1
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-URI https://asc.fasb.org/1943274/2147483326/850-10-50-1

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
-Section S99
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Reference 8: http://www.xbrl.org/2003/role/disclosureRef
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
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-URI https://asc.fasb.org/1943274/2147479134/946-220-S99-1

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 850
-Name Accounting Standards Codification
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-URI https://asc.fasb.org/850/tableOfContent

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
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-Paragraph 6
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147483326/850-10-50-6

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
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-Paragraph 1
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-URI https://asc.fasb.org/1943274/2147483326/850-10-50-1

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 850
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-Section 50
-Paragraph 1
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147483326/850-10-50-1

+ Details

DEBT

6 Months Ended

Jun. 30, 2024

Debt Disclosure [Abstract]

DEBT

The following is a summary of the Company’s outstanding debt (in thousands):


	June 30, 2024		December 31, 2023
Term Loans
5-year term loan, periodic interest and monthly principal payments, Daily Simple SOFR + 0.11448% SOFR adjustment, matures July 30, 2024	$	147	$	584
7-year term loan, periodic interest and monthly principal payments, Daily Simple SOFR + 0.11448% SOFR adjustment, matures December 6, 2027	6,853		7,772
Total term loans	7,000		8,356
Revolving Facility
5-year revolving credit facility, periodic interest payments, Term SOFR + 0.10% SOFR adjustment + 2% up to 2.75% applicable margin based on the consolidated leverage ratio, plus commitment fees of 0.20% up to 0.35% based on the consolidated leverage ratio, matures May 23, 2028	41,000		41,000
Deferred acquisition payable	1,633		1,381
Total debt	49,633		50,737
Current maturities	(2,613)		(2,781)
Long-term debt	$	47,020	$	47,956

Future maturities of the Company’s outstanding debt as of June 30, 2024, were as follows (in thousands):


Remainder of 2024	$	1,412
2025	2,416
2026	2,473
2027	2,209
2028	41,063
Thereafter	60
Total	$	49,633

For the three and six months ended June 30, 2024, the Company incurred interest expense of $0.9 million and $1.7 million, respectively. For the three and six months ended June 30, 2023, the Company incurred interest expense of $0.2 million and $0.3 million, respectively.

Term Loans

The 5-year term loan was entered into on July 30, 2019, with the original principal of $4.0 million, while the 7-year term loan was entered into on December 4, 2020, with the original principal of $13.0 million. The Company entered into interest rate swap agreements to manage its exposure to interest rate fluctuations related to its term loans. See Note 6 for more information relating to the interest rate swaps associated with these loans.

Revolving Credit Agreement

On May 23, 2023, the Company entered into a Revolving Credit Agreement with PNC Bank National Association (“Lender”) which provides a revolving credit facility to the Company, with commitments in an aggregate principal amount not to exceed $50.0 million (as amended on June 20, 2024, the “Revolving Facility”). The borrowings under the Revolving Facility will be used by the Company for permitted acquisitions, working capital and general corporate purposes.

The Company pays a commitment fee on undrawn amounts under the Revolving Facility of 0.20% to up to 0.35% based on the consolidated leverage ratio. As of both June 30, 2024 and December 31, 2023, the unused capacity under the Revolving Facility was $9.0 million.

Borrowings under the term loans and the Revolving Facility are secured by substantially all assets constituting personal property of TWFG, Inc. and its subsidiaries, including receivables, inventory, equipment, and intellectual property, subject to certain exceptions. In addition, the term loan agreement contains covenants that restrict the

Company’s ability to make certain distributions or dividend payments, incur additional debt, engage in certain asset sales, mergers, acquisitions or similar transactions, create liens on assets, engage in certain transactions with affiliates, change the Company’s business or make investments. In addition, the term loan agreement requires the Company to maintain certain financial ratios. As of June 30, 2024 and December 31, 2023, the Company was in compliance with these covenants. Because the Company’s term loans and borrowings under the Revolving Facility have variable interest rates, the outstanding debt as of June 30, 2024 and December 31, 2023 approximates fair value.

Acquisition-Related Notes

In April 2023, the Company acquired customer list intangible assets for a total consideration of $4.3 million, of which $3.0 million was paid in cash at closing. The remaining balance was settled through the issuance of a note payable monthly over three years beginning in April 2024 and bears an annual interest of 3.75%.

In March 2024, the Company acquired customer list intangible assets, of which approximately $0.4 million of the purchase price was settled through the issuance of a non-interest bearing note and was recorded as deferred acquisition payable. The note is payable monthly over a period of 70 months. The deferred acquisition payable was recorded at fair value with an imputed interest rate of 5.00%.

The portion of the Company’s acquisition-related notes due within 12 months or less from the financial statement date is reported in the Condensed Consolidated Statements of Financial Position as Deferred acquisition payable, current, while the amount due after 12 months from the financial statement date is included in Deferred acquisition payable, non-current. See Notes 4 and 9 for more information regarding the purchase of the customer list intangible assets.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 6
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481544/470-10-50-6

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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Reference 8: http://www.xbrl.org/2003/role/disclosureRef
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
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Reference 10: http://fasb.org/us-gaap/role/ref/legacyRef
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Reference 11: http://www.xbrl.org/2003/role/disclosureRef
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Reference 12: http://www.xbrl.org/2003/role/disclosureRef
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-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481139/470-20-50-1I

Reference 20: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1I
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481139/470-20-50-1I

Reference 21: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1I
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org/1943274/2147481139/470-20-50-1I

+ Details

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Schedule Of Property and Equipment Estimated Useful Lives Of Assets (Details)	Jun. 30, 2024
Automobiles
Property, Plant and Equipment [Line Items]
Useful Life	5 years
Computer equipment
Property, Plant and Equipment [Line Items]
Useful Life	5 years
Furniture and fixtures
Property, Plant and Equipment [Line Items]
Useful Life	7 years
Office equipment \| Minimum
Property, Plant and Equipment [Line Items]
Useful Life	5 years
Office equipment \| Maximum
Property, Plant and Equipment [Line Items]
Useful Life	7 years

SUBSEQUENT EVENTS	6 Months Ended
SUBSEQUENT EVENTS	Jun. 30, 2024
Subsequent Events [Abstract]
SUBSEQUENT EVENTS	SUBSEQUENT EVENTS We have evaluated subsequent events through August 30, 2024, the issuance date and determined that no events have occurred that require disclosure other than the events listed below. Initial Public Offering On July 19, 2024, TWFG, Inc. completed its IPO of 11,000,000 shares of Class A common stock at an initial public offering price of $17.00 per share. On July 23, 2024, the underwriters purchased an additional 1,650,000 shares of Class A common stock in connection with the underwriters’ full exercise of their option to purchase additional shares. TWFG, Inc. received approximately $194.1 million of net proceeds from the IPO, including from the full exercise of the underwriters’ option, after deducting underwriting discounts and commissions and estimated offering expenses. Immediately following the completion of the IPO and related reorganization transactions, TWFG, Inc. held an approximately 26.5% interest in the Company. Also on July 19, 2024, in connection with the reorganization transactions immediately prior to the IPO, TWFG, Inc. issued (i) 2,161,874 shares of its Class A common stock in exchange for units in TWFG Holding, (ii) 7,277,651 shares of its Class B common stock for consideration of $0.00001 per share and (iii) 33,893,810 shares of its Class C common stock for consideration of $0.00001 per share to members of TWFG Holding. Revolving Credit Facility Repayment On August 5, 2024, the Company repaid the outstanding balance of its Revolving Facility amounting to $41.0 million using a portion of the net proceeds from the IPO.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Narrative (Details)	1 Months Ended		3 Months Ended		6 Months Ended
	May 31, 2023 membershipClass vote	Apr. 30, 2023 membershipClass vote	Jun. 30, 2024 USD ($)	Jun. 30, 2023 USD ($)	Jun. 30, 2024 USD ($) segment	Jun. 30, 2023 USD ($)	Dec. 31, 2023 USD ($)	Jan. 01, 2023 USD ($)
Accounting Policies [Line Items]
Restricted cash			$ 10,758,000	$ 8,080,000	$ 10,758,000	$ 8,080,000	$ 7,200,000
Carrier liabilities			15,190,000		15,190,000		8,731,000
Allowance for credit loss			(400,000)		(400,000)		(300,000)	$ (300,000)
Accounts receivable, allowance for credit loss			0		0		0
Asset impairment charges			0	0	0	0
Impairment on property and equipment			0	$ 0	0	$ 0
Deferred offering costs			$ 5,917,000		5,917,000		$ 2,025,000
Variable lease payments					$ 0
Number of classes of membership interests \| membershipClass	3	1
Number of votes per unit \| vote		1
Number of operating segments \| segment					1
Number of reportable segments \| segment					1
Class A
Accounting Policies [Line Items]
Number of votes per unit \| vote	1
Class B
Accounting Policies [Line Items]
Number of votes per unit \| vote	1
Class C
Accounting Policies [Line Items]
Number of votes per unit \| vote	10
Minimum \| Computer Software
Accounting Policies [Line Items]
Intangible asset, useful life			3 years		3 years
Minimum \| Customer Lists
Accounting Policies [Line Items]
Intangible asset, useful life			8 years		8 years
Maximum \| Computer Software
Accounting Policies [Line Items]
Intangible asset, useful life			5 years		5 years
Maximum \| Customer Lists
Accounting Policies [Line Items]
Intangible asset, useful life			10 years		10 years

DISCONTINUED OPERATION

6 Months Ended

Jun. 30, 2024

Discontinued Operations and Disposal Groups [Abstract]

DISCONTINUED OPERATION

Prior to February 2023, TWICO was a wholly owned subsidiary of the Company. In July 2022, the Company entered into a Master Transaction Agreement in which the Company’s equity interests in TWICO were distributed to the owners of the Company (“TWICO Distribution”). The TWICO Distribution was effective in February 2023 after approval from the Texas Department of Insurance. The TWICO Distribution is a common control transaction and recorded at book value as a capital transaction with no gain or loss recorded. TWICO, as a subsidiary of the Company, was determined to be a component of the Company and disposed of by other-than-sale. The TWICO Distribution represents a significant strategic shift in the operations of the Company and has met all criteria for discontinued operations reporting on the distribution date, i.e., February 2023. After the TWICO Distribution, the Company retains significant continuing involvement in the operation of TWICO through TWICO’s existing agency agreement with TWFG-GA and the management agreement with the Company. See Note 9 for more information about the transactions between the Company, TWFG-GA and TWICO.

The following is a reconciliation of the amounts of major classes of income from operations classified as discontinued operation in the Consolidated Statement of Operations (in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
Revenue	$	—	$	—	$	—	$	1,240
Less: Operating expenses	—		—		—		450
Operating income	—		—		—		790
Less: Income tax benefit	—		—		—		(44)
Net income from discontinued operation, net of tax	$	—	$	—	$	—	$	834

Condensed Consolidated Statements of Financial Position (Parenthetical) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Members' Equity	$ 67,512	$ 31,051
Class A
Common stock issued (in shares)	27,689,000	0
Common stock outstanding (in shares)	27,689,000	0
Class B
Common stock issued (in shares)	110,750,000	110,750,000
Common stock outstanding (in shares)	110,750,000	110,750,000
Class C
Common stock issued (in shares)	521,000,000	521,000,000
Common stock outstanding (in shares)	521,000,000	521,000,000

SUBSEQUENT EVENTS (Details) - USD ($) $ / shares in Units, $ in Millions	Aug. 05, 2024	Jul. 23, 2024	Jul. 19, 2024	Jan. 01, 2024
Class A
Subsequent Event [Line Items]
New units issued during period (in shares)				27,689
Subsequent Event
Subsequent Event [Line Items]
Percentage of ownership after transaction			26.50%
Subsequent Event \| Revolving Credit Facility \| Line of Credit
Subsequent Event [Line Items]
Revolving credit facility repayment	$ 41.0
Subsequent Event \| Class A
Subsequent Event [Line Items]
New units issued during period (in shares)			2,161,874
Subsequent Event \| Class B
Subsequent Event [Line Items]
New units issued during period (in shares)			7,277,651
Shares issued, price per share (in USD per shares)			$ 0.00001
Subsequent Event \| Class C
Subsequent Event [Line Items]
New units issued during period (in shares)			33,893,810
Shares issued, price per share (in USD per shares)			$ 0.00001
Subsequent Event \| IPO And Over-Allotment Option
Subsequent Event [Line Items]
Net proceeds received			$ 194.1
Subsequent Event \| IPO \| Class A
Subsequent Event [Line Items]
Number of shares issued in transaction (in shares)			11,000,000
Offering price per share (in dollar per share)			$ 17.00
Subsequent Event \| Over-Allotment Option \| Class A
Subsequent Event [Line Items]
Number of shares issued in transaction (in shares)		1,650,000

INTANGIBLE ASSETS (Tables)

6 Months Ended

Jun. 30, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Finite-Lived Intangible Assets

The following table presents information about the Company’s intangible assets (in thousands):


	June 30, 2024								December 31, 2023
	Customer Lists		Computer Software		Non-Compete Agreements		Total		Customer Lists		Computer Software		Non-Compete Agreements		Total
Cost
Balance, beginning of period	$	48,997	$	7,858	$	275	$	57,130	$	29,177	$	8,472	$	275	$	37,924
Additions(1)	46,765		444		—		47,209		20,678		1,129		—		21,807
Disposals(2)	—		—		—		—		(858)		(1,743)		—		(2,601)
Balance, end of period	95,762		8,302		275		104,339		48,997		7,858		275		57,130
Accumulated amortization	20,090		6,191		264		26,545		14,779		5,684		231		20,694
Net carrying amount, end of period	$	75,672	$	2,111	$	11	$	77,794	$	34,218	$	2,174	$	44	$	36,436


	2024								2023
	Customer Lists		Computer Software		Non-Compete Agreements		Total		Customer Lists		Computer Software		Non-Compete Agreements		Total
Three Months Ended June 30,
Amortization expense	$	2,648	$	252	$	4	$	2,904	$	756	$	285	$	29	$	1,070
Six Months Ended June 30,
Amortization expense	$	5,311	$	507	$	33	$	5,851	$	1,366	$	641	$	58	$	2,065

(1)The acquired customer lists in 2024 and 2023 have a weighted average amortization period of 8 years.

(2)For both the three and six months ended June 30, 2024, $0.06 million gain on sale of customer lists was recognized by the Company. For both the three and six months ended June 30, 2023, $0.01 million loss on sale of customer lists was recognized by the Company.

Schedule of Future Amortization for Intangible Assets

The following table presents the future amortization for intangible assets as of June 30, 2024 (in thousands):


	Customer Lists		Computer Software		Non-Compete Agreements
Remainder of 2024	$	5,342	$	457	$	8
2025	10,663		588		3
2026	10,606		478		—
2027	10,559		380		—
2028	10,523		193		—
Thereafter	27,979		15		—
Total	$	75,672	$	2,111	$	11

Condensed Consolidated Statements of Financial Position - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Current assets
Cash and cash equivalents	$ 25,755	$ 39,297
Restricted cash	10,758	7,171
Commissions receivable, net	22,401	19,082
Accounts receivable	9,608	5,982
Deferred offering costs	5,917	2,025
Other current assets, net	911	1,551
Total current assets	75,350	75,108
Non-current assets
Net carrying amount, end of period	77,794	36,436
Property and equipment - net	514	597
Lease right-of-use assets - net	2,760	2,459
Other non-current assets	801	837
Total assets	157,219	115,437
Current liabilities
Commissions payable	15,301	12,487
Carrier liabilities	15,190	8,731
Operating lease liabilities, current	1,031	882
Short-term bank debt	2,030	2,437
Deferred acquisition payable, current	583	5,369
Other current liabilities	6,913	5,006
Total current liabilities	41,048	34,912
Non-current liabilities
Operating lease liabilities, net of current portion	1,639	1,518
Long-term bank debt	45,970	46,919
Deferred acquisition payable, non-current	1,050	1,037
Total liabilities	89,707	84,386
Commitment and contingencies (see Note 12)
Members’ equity
Additional paid-in capital	55,132	25,114
Retained earnings	11,253	4,805
Accumulated other comprehensive income	467	500
Total members’ equity	67,512	31,051
Total liabilities and members’ equity	157,219	115,437
Class A
Members’ equity
Common units	28	0
Class B
Members’ equity
Common units	111	111
Class C
Members’ equity
Common units	$ 521	$ 521

NET INCOME PER UNIT (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Earnings Per Share, Basic [Abstract]
Weighted average units used in the computation of net income per unit (in shares)	659,439	631,750	659,439	631,750
Net income per unit (us dollar per share)	$ 10.49	$ 11.19	$ 20.54	$ 21.01
Net income from continuing operations per unit (us dollar per share)	$ 10.49	$ 11.19	$ 20.54	$ 19.69
Earnings Per Share, Diluted [Abstract]
Weighted average units used in the computation of net income per unit (in shares)	659,439	631,750	659,439	631,750
Net income per unit (us dollar per share)	$ 10.49	$ 11.19	$ 20.54	$ 21.01
Net income from continuing operations per unit (us dollar per share)	$ 10.49	$ 11.19	$ 20.54	$ 19.69
Class A
Earnings Per Share, Basic [Abstract]
Net income (in shares)	$ 291	$ 0	$ 569	$ 0
Weighted average units used in the computation of net income per unit (in shares)	27,689	0	27,689	0
Net income per unit (us dollar per share)	$ 10.49	$ 0	$ 20.54	$ 0
Net income from continuing operations (in shares)				$ 0
Net income from continuing operations per unit (us dollar per share)				$ 0
Net loss from discontinued operation, net of tax (in shares)				$ 0
Net loss from discontinued operation per unit (us dollar per share)				$ 0
Earnings Per Share, Diluted [Abstract]
Net income (in shares)	$ 291	$ 0	$ 569	$ 0
Weighted average units used in the computation of net income per unit (in shares)	27,689	0	27,689	0
Net income per unit (us dollar per share)	$ 10.49	$ 0	$ 20.54	$ 0
Net income from continuing operations (in shares)				$ 0
Net income from continuing operations per unit (us dollar per share)				$ 0
Net loss from discontinued operation, net of tax (in shares)				$ 0
Net loss from discontinued operation per unit (us dollar per share)				$ 0
Class B
Earnings Per Share, Basic [Abstract]
Net income (in shares)	$ 1,162	$ 1,239	$ 2,275	$ 2,327
Weighted average units used in the computation of net income per unit (in shares)	110,750	110,750	110,750	110,750
Net income per unit (us dollar per share)	$ 10.49	$ 11.19	$ 20.54	$ 21.01
Net income from continuing operations (in shares)				$ 2,181
Net income from continuing operations per unit (us dollar per share)				$ 19.69
Net loss from discontinued operation, net of tax (in shares)				$ 146
Net loss from discontinued operation per unit (us dollar per share)				$ 1.32
Earnings Per Share, Diluted [Abstract]
Net income (in shares)	$ 1,162	$ 1,239	$ 2,275	$ 2,327
Weighted average units used in the computation of net income per unit (in shares)	110,750	110,750	110,750	110,750
Net income per unit (us dollar per share)	$ 10.49	$ 11.19	$ 20.54	$ 21.01
Net income from continuing operations (in shares)				$ 2,181
Net income from continuing operations per unit (us dollar per share)				$ 19.69
Net loss from discontinued operation, net of tax (in shares)				$ 146
Net loss from discontinued operation per unit (us dollar per share)				$ 1.32
Class C
Earnings Per Share, Basic [Abstract]
Net income (in shares)	$ 5,465	$ 5,828	$ 10,703	$ 10,946
Weighted average units used in the computation of net income per unit (in shares)	521,000	521,000	521,000	521,000
Net income per unit (us dollar per share)	$ 10.49	$ 11.19	$ 20.54	$ 21.01
Net income from continuing operations (in shares)				$ 10,258
Net income from continuing operations per unit (us dollar per share)				$ 19.69
Net loss from discontinued operation, net of tax (in shares)				$ 688
Net loss from discontinued operation per unit (us dollar per share)				$ 1.32
Earnings Per Share, Diluted [Abstract]
Net income (in shares)	$ 5,465	$ 5,828	$ 10,703	$ 10,946
Weighted average units used in the computation of net income per unit (in shares)	521,000	521,000	521,000	521,000
Net income per unit (us dollar per share)	$ 10.49	$ 11.19	$ 20.54	$ 21.01
Net income from continuing operations (in shares)				$ 10,258
Net income from continuing operations per unit (us dollar per share)				$ 19.69
Net loss from discontinued operation, net of tax (in shares)				$ 688
Net loss from discontinued operation per unit (us dollar per share)				$ 1.32

ORGANIZATION AND BASIS OF PRESENTATION (Details)			1 Months Ended
ORGANIZATION AND BASIS OF PRESENTATION (Details)	Jan. 01, 2024 shares	Mar. 23, 2018	May 31, 2023 membershipClass vote	Apr. 30, 2023 membershipClass	Aug. 31, 2021	Mar. 31, 2018
Franchisor Disclosure [Line Items]
Number of classes of membership interests \| membershipClass			3	1
Class A
Franchisor Disclosure [Line Items]
Number of votes per unit \| vote			1
New units issued during period (in shares)	27,689
Class B
Franchisor Disclosure [Line Items]
Number of votes per unit \| vote			1
Class C
Franchisor Disclosure [Line Items]
Number of votes per unit \| vote			10
TWFG Holding Company, LLC \| Bunch Family Holdings, LLC
Franchisor Disclosure [Line Items]
LLC managing member ownership percentage	79.00%	100.00%	82.50%
Membership ownership, total ownership held			82.50%
Percentage of voting interest	97.40%		97.90%
TWFG Holding Company, LLC \| RenaissanceRe Ventures U.S. LLC
Franchisor Disclosure [Line Items]
LLC managing member ownership percentage	12.60%		13.10%			17.50%
Membership ownership, total ownership held			13.10%
Percentage of voting interest	1.60%		1.60%
TWFG Holding Company, LLC \| GHC Woodlands Holdings LLC
Franchisor Disclosure [Line Items]
LLC managing member ownership percentage	4.20%		4.40%		4.40%
Membership ownership, total ownership held			4.40%
Percentage of voting interest	0.50%		0.50%
TWFG Holding Company, LLC \| New Owners
Franchisor Disclosure [Line Items]
LLC managing member ownership percentage	4.20%
Percentage of voting interest	0.50%
TWFG Holding Company, LLC \| Class A \| New Owners
Franchisor Disclosure [Line Items]
Number of stock units owned by parent (in shares)	27,689
TWFG Holding Company, LLC \| Class B \| RenaissanceRe Ventures U.S. LLC
Franchisor Disclosure [Line Items]
LLC managing member ownership percentage			75.00%
Number of stock units owned by parent (in shares)	83,050
TWFG Holding Company, LLC \| Class B \| GHC Woodlands Holdings LLC
Franchisor Disclosure [Line Items]
LLC managing member ownership percentage			25.00%
Number of stock units owned by parent (in shares)	27,700
TWFG Holding Company, LLC \| Class C \| Bunch Family Holdings, LLC
Franchisor Disclosure [Line Items]
LLC managing member ownership percentage			100.00%
Number of stock units owned by parent (in shares)	521,000

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

6 Months Ended

Jun. 30, 2024

Accounting Policies [Abstract]

Schedule of Property and Equipment, Estimated Useful Lives of Assets

Property and equipment are depreciated using the straight-line method over the estimated useful lives of the assets as follows:


			Useful Life
Automobiles			5 years
Computer equipment			5 years
Furniture and fixtures			7 years
Leasehold improvements			Lesser of the estimated useful life or the underlying lease term
Office equipment			5 - 7 years

INTANGIBLE ASSETS

6 Months Ended

Jun. 30, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

INTANGIBLE ASSETS

In April 2023, the Company purchased the assets of Ralph E. Wade Insurance Agency Inc. (“Wade”), which resulted in the Company recording an increase in customer lists intangible assets of $4.3 million. Immediately following the asset purchase, the Company sold 10.9% interest in the asset purchased from Wade to American Insurance Strategies, LLC (“AIS”) for a total consideration of $0.5 million.

In May 2023, the Company purchased 50.1% of the assets of Luczkowski Insurance Agency Inc. (“Luczkowski”) and Jim Kelly Insurance Agency Inc. (“Kelly”), which resulted in the Company recording an increase in customer lists intangible assets of $0.6 million from the Luczkowski asset purchase and $1.1 million from the Kelly asset purchase.

In October 2023, the Company purchased the assets of Jeff Kincaid Insurance Agency, Inc. (“Kincaid”), which resulted in the Company recording an increase in customer lists intangible assets of $11.8 million. In December 2023, the Company purchased the assets of Brinson, Inc. (“Brinson”), which resulted in the Company recording an increase in customer lists intangible assets of $2.0 million. In January 2024, the Company issued a total of 4,164 Class A common units to settle the equity component of the Kincaid and Brinson asset purchase considerations.

The Company previously acquired partial interests in the assets of AIS, Luczkowski, and Kelly and operated them as corporate branches. In January 2024, the Company acquired the remaining interests in the assets of AIS, Luczkowski, and Kelly for a total purchase price of $5.2 million, converting them to wholly owned corporate branches. The Company paid the total purchase price related to these asset acquisitions through the issuance of equity.

In January 2024, the Company acquired the assets of nine of its independent branches and converted those independent branches to corporate branches. The transactions resulted in the Company recording an increase in customer list intangible assets of $40.8 million. The Company issued equity and paid cash amounting to $20.4 million in settlement for the total purchase price.

In addition to the acquisitions described above, the Company purchased customer lists intangible assets totaling $0.8 million for the six months ended June 30, 2024 and $0.9 million for the year ended December 31, 2023, representing purchases of assets with annualized revenue of less than $0.5 million.

The following table presents information about the Company’s intangible assets (in thousands):


	June 30, 2024								December 31, 2023
	Customer Lists		Computer Software		Non-Compete Agreements		Total		Customer Lists		Computer Software		Non-Compete Agreements		Total
Cost
Balance, beginning of period	$	48,997	$	7,858	$	275	$	57,130	$	29,177	$	8,472	$	275	$	37,924
Additions(1)	46,765		444		—		47,209		20,678		1,129		—		21,807
Disposals(2)	—		—		—		—		(858)		(1,743)		—		(2,601)
Balance, end of period	95,762		8,302		275		104,339		48,997		7,858		275		57,130
Accumulated amortization	20,090		6,191		264		26,545		14,779		5,684		231		20,694
Net carrying amount, end of period	$	75,672	$	2,111	$	11	$	77,794	$	34,218	$	2,174	$	44	$	36,436


	2024								2023
	Customer Lists		Computer Software		Non-Compete Agreements		Total		Customer Lists		Computer Software		Non-Compete Agreements		Total
Three Months Ended June 30,
Amortization expense	$	2,648	$	252	$	4	$	2,904	$	756	$	285	$	29	$	1,070
Six Months Ended June 30,
Amortization expense	$	5,311	$	507	$	33	$	5,851	$	1,366	$	641	$	58	$	2,065

(1)The acquired customer lists in 2024 and 2023 have a weighted average amortization period of 8 years.

The following table presents the future amortization for intangible assets as of June 30, 2024 (in thousands):


	Customer Lists		Computer Software		Non-Compete Agreements
Remainder of 2024	$	5,342	$	457	$	8
2025	10,663		588		3
2026	10,606		478		—
2027	10,559		380		—
2028	10,523		193		—
Thereafter	27,979		15		—
Total	$	75,672	$	2,111	$	11

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023
Cash Flows from Operating Activities
Net income	$ 13,547	$ 13,273
Less: Net income from discontinued operation, net of tax	0	834
Net income from continuing operations	13,547	12,439
Adjustments to reconcile net income to cash flows from operating activities:
Depreciation and amortization	5,981	2,195
Gain on sale of intangible assets and property and equipment	(65)	13
Non-cash lease expense	507	323
Other non-cash items	(16)	9
Change in:
Commissions receivable, net	(3,319)	(2,573)
Accounts receivable	(3,626)	(534)
Other current and non-current assets	651	216
Commissions payable	2,813	3,554
Operating lease liabilities	(530)	(339)
Other current liabilities	1,211	567
Net cash provided by operating activities from continuing operations	17,154	15,870
Net cash provided by operating activities from discontinued operation	0	839
Net cash provided by operating activities	17,154	16,709
Cash Flows from Investing Activities
Proceeds from disposition of intangible assets	64	524
Proceeds from disposition of property and equipment	1	1
Purchase of intangible assets	(21,241)	(5,711)
Purchase of property and equipment	(47)	(54)
Net cash used in investing activities from continuing operations	(21,223)	(5,240)
Net cash provided by investing activities from discontinued operation	0	64
Net cash used in investing activities	(21,223)	(5,176)
Cash Flows from Financing Activities
Proceeds from borrowings	0	10,000
Repayment of borrowings	(1,356)	(1,310)
Distributions to members	(7,099)	(10,565)
Cash derecognized upon distribution of EVO to members (see Note 2)	0	(2,229)
Payment of deferred offering costs	(3,209)	0
Payment of equity issuance costs	(37)	0
Net change in carrier liabilities	6,460	672
Payment of deferred acquisition payable	(645)	(3)
Net cash (used in) provided by financing activities from continuing operations	(5,886)	(3,435)
Net cash used in financing activities from discontinued operation	0	(11,305)
Net cash (used in) provided by financing activities	(5,886)	(14,740)
Net change in cash, cash equivalents and restricted cash from continuing operations	(9,955)	7,195
Net change in cash, cash equivalents and restricted cash from discontinued operation	0	(10,402)
Net change in cash, cash equivalents and restricted cash	(9,955)	(3,207)
Cash, cash equivalents and restricted cash from continuing operations - beginning balance	46,468	30,262
Cash, cash equivalents and restricted cash from discontinued operation - beginning balance	0	10,402
Cash, cash equivalents and restricted cash - beginning balance	46,468	40,664
Cash, cash equivalents and restricted cash - ending balance	36,513	37,457
Less: Cash, cash equivalents and restricted cash from discontinued operation - ending balance	0	0
Cash, cash equivalents and restricted cash from continuing operations - ending balance	36,513	37,457
Reconciliation of cash, cash equivalents and restricted cash, end of period:
Cash and cash equivalents	25,755	29,377
Restricted cash	10,758	8,080
Cash, cash equivalents and restricted cash, end of period	36,513	37,457
Net change in cash and cash equivalents	(13,542)	(3,355)
Net change in restricted cash	3,587	148
Net change in cash, cash equivalents and restricted cash	(9,955)	(3,207)
Supplemental cash flow information:
Cash paid for interest	1,893	169
Non-cash investing and financing activities:
Additions to intangible assets and offsetting additions to deferred acquisition payable	396	1,395
Additions to intangible assets and offsetting additions to members' equity	25,560	0
Additions to intangible assets and offsetting additions to other current liabilities	12	0
Settlement of deferred acquisition payable through the issuance of Class A common units	4,524	0
Distribution to members	0	6,260
Unpaid deferred offering costs	$ 1,911	$ 0

OPERATING LEASES

6 Months Ended

Jun. 30, 2024

Leases [Abstract]

OPERATING LEASES

The following table summarizes the Company’s lease costs and supplemental cash flow information related to its operating leases (dollar amounts in thousands):


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024			2023
Operating lease costs reported in Other administrative expenses	$	268	$	182	$	526		$	330
Short-term operating lease costs reported in Other administrative expenses	38		3		73			10
Total lease costs	$	306	$	185	$	599		$	340

Weighted average remaining lease term (in years)					3.2			3.8
Weighted average discount rate					2.42		%	2.80		%

Supplemental cash flow information:
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows used in operating leases reported in Change in operating lease liabilities	$	275	$	190	$	549		$	346
Operating lease non-cash items:
Non-cash right-of-use assets obtained in exchange for new operating lease liabilities	$	41	$	504	$	808		$	526

The estimated future minimum payments of operating leases as of June 30, 2024 (in thousands):


Remainder of 2024	$	554
2025	1,081
2026	779
2027	368
2028	167
2029	5
Total undiscounted future lease payments	2,954
Less: imputed interest	(284)
Present value of lease liabilities	$	2,670

INTANGIBLE ASSETS - Schedule of Intangible Assets (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023	Dec. 31, 2023
Finite-Lived Intangible Assets [Roll Forward]
Balance, beginning of period			$ 57,130	$ 37,924	$ 37,924
Additions			47,209		21,807
Disposals			0		(2,601)
Balance, end of period	$ 104,339		104,339		57,130
Accumulated amortization	26,545		26,545		20,694
Net carrying amount, end of period	77,794		77,794		36,436
Amortization expense	2,904	$ 1,070	$ 5,851	$ 2,065
Weighted average amortization period (in years)			8 years	8 years
Customer Lists
Finite-Lived Intangible Assets [Roll Forward]
Balance, beginning of period			$ 48,997	$ 29,177	29,177
Additions			46,765		20,678
Disposals			0		(858)
Balance, end of period	95,762		95,762		48,997
Accumulated amortization	20,090		20,090		14,779
Net carrying amount, end of period	75,672		75,672		34,218
Amortization expense	2,648	756	5,311	1,366
Gain (loss) on sales	60	(10)	60	(10)
Computer Software
Finite-Lived Intangible Assets [Roll Forward]
Balance, beginning of period			7,858	8,472	8,472
Additions			444		1,129
Disposals			0		(1,743)
Balance, end of period	8,302		8,302		7,858
Accumulated amortization	6,191		6,191		5,684
Net carrying amount, end of period	2,111		2,111		2,174
Amortization expense	252	285	507	641
Non-Compete Agreements
Finite-Lived Intangible Assets [Roll Forward]
Balance, beginning of period			275	275	275
Additions			0		0
Disposals			0		0
Balance, end of period	275		275		275
Accumulated amortization	264		264		231
Net carrying amount, end of period	11		11		$ 44
Amortization expense	$ 4	$ 29	$ 33	$ 58

Condensed Consolidated Statements of Members’ Equity - USD ($) $ in Thousands	Total	Common Units	Additional Paid-In Capital	Retained Earnings	Accumulated Other Comprehensive Income (Loss)	Cumulative Effect, Period of Adoption, Adjustment	Cumulative Effect, Period of Adoption, Adjustment Retained Earnings	Cumulative Effect, Period of Adoption, Adjusted Balance	Cumulative Effect, Period of Adoption, Adjusted Balance Common Units	Cumulative Effect, Period of Adoption, Adjusted Balance Additional Paid-In Capital	Cumulative Effect, Period of Adoption, Adjusted Balance Retained Earnings	Cumulative Effect, Period of Adoption, Adjusted Balance Accumulated Other Comprehensive Income (Loss)	Class A Common Units	Class A Cumulative Effect, Period of Adoption, Adjusted Balance Common Units	Class B Common Units	Class B Cumulative Effect, Period of Adoption, Adjusted Balance Common Units	Class C Common Units	Class C Cumulative Effect, Period of Adoption, Adjusted Balance Common Units
Beginning balance (in shares) at Dec. 31, 2022		631,750											0		0		0
Beginning balance (in shares) at Dec. 31, 2022	$ 57,786	$ 632	$ 25,114	$ 32,180	$ (140)	$ (271)	$ (271)	$ 57,515	$ 632	$ 25,114	$ 31,909	$ (140)	$ 0	$ 0	$ 0	$ 0	$ 0	$ 0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	6,206			6,206
Cash distributions to members	(5,378)			(5,378)
Other comprehensive income	(16,599)			(16,599)
Total other comprehensive (loss) income, net of tax	39				39
Impact of discontinued operation on accumulated other comprehensive income (loss)	775				775
Ending balance (in shares) at Mar. 31, 2023		631,750											0		0		0
Ending balance (in shares) at Mar. 31, 2023	42,558	$ 632	25,114	16,138	674								$ 0		$ 0		$ 0
Beginning balance (in shares) at Dec. 31, 2022		631,750											0		0		0
Beginning balance (in shares) at Dec. 31, 2022	57,786	$ 632	25,114	32,180	(140)	$ (271)	$ (271)	$ 57,515	$ 632	$ 25,114	$ 31,909	$ (140)	$ 0	$ 0	$ 0	$ 0	$ 0	$ 0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	13,273
Total other comprehensive (loss) income, net of tax	87
Ending balance (in shares) at Jun. 30, 2023		0											0		110,750		521,000
Ending balance (in shares) at Jun. 30, 2023	41,292	$ 0	25,114	14,824	722								$ 0		$ 111		$ 521
Beginning balance (in shares) at Mar. 31, 2023		631,750											0		0		0
Beginning balance (in shares) at Mar. 31, 2023	42,558	$ 632	25,114	16,138	674								$ 0		$ 0		$ 0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	7,067			7,067
Cash distributions to members	(5,186)			(5,186)
Other comprehensive income	(3,195)			(3,195)
Units exchanged (in shares)		(631,750)													110,750		521,000
Units exchanged (see Note 1)	0	$ (632)													$ 111		$ 521
Total other comprehensive (loss) income, net of tax	48				48
Ending balance (in shares) at Jun. 30, 2023		0											0		110,750		521,000
Ending balance (in shares) at Jun. 30, 2023	41,292	$ 0	25,114	14,824	722								$ 0		$ 111		$ 521
Beginning balance (in shares) at Dec. 31, 2023		0											0		110,750		521,000
Beginning balance (in shares) at Dec. 31, 2023	31,051	$ 0	25,114	4,805	500								$ 0		$ 111		$ 521
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	6,629			6,629
Units issued (in shares)													27,689
Units issued (see Note 1)	30,046		30,018										$ 28
Cash distributions to members	(2,420)			(2,420)
Total other comprehensive (loss) income, net of tax	23				23
Ending balance (in shares) at Mar. 31, 2024		0											27,689		110,750		521,000
Ending balance (in shares) at Mar. 31, 2024	65,329	$ 0	55,132	9,014	523								$ 28		$ 111		$ 521
Beginning balance (in shares) at Dec. 31, 2023		0											0		110,750		521,000
Beginning balance (in shares) at Dec. 31, 2023	31,051	$ 0	25,114	4,805	500								$ 0		$ 111		$ 521
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	13,547
Total other comprehensive (loss) income, net of tax	(33)
Ending balance (in shares) at Jun. 30, 2024		0											27,689		110,750		521,000
Ending balance (in shares) at Jun. 30, 2024	67,512	$ 0	55,132	11,253	467								$ 28		$ 111		$ 521
Beginning balance (in shares) at Mar. 31, 2024		0											27,689		110,750		521,000
Beginning balance (in shares) at Mar. 31, 2024	65,329	$ 0	55,132	9,014	523								$ 28		$ 111		$ 521
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	6,918			6,918
Cash distributions to members	(4,679)			(4,679)
Total other comprehensive (loss) income, net of tax	(56)				(56)
Ending balance (in shares) at Jun. 30, 2024		0											27,689		110,750		521,000
Ending balance (in shares) at Jun. 30, 2024	$ 67,512	$ 0	$ 55,132	$ 11,253	$ 467								$ 28		$ 111		$ 521

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

6 Months Ended

Jun. 30, 2024

Accounting Policies [Abstract]

Basis of Presentation

The condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and include the accounts of TWFG Holding and its subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. In the opinion of management, the condensed consolidated financial statements include all normal recurring adjustments necessary to present fairly the Company’s condensed consolidated financial position, results of operations, and cash flows for all periods presented. Certain prior period amounts have been reclassified to conform with the current period presentation.

The Company is an emerging growth company and has elected to avail itself of the extended transition period for complying with new or revised accounting standards.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of intangible assets, lease right-of-use assets and operating lease liabilities as of the date of the financial statements and commission income and contingent income during the reporting period. Actual results could differ from those estimates as more information becomes known.

Revenue Recognition

The Company applies the following five-step model in order to determine revenue recognition: (i) identification of the contract with a customer; (ii) identification of the performance obligations in the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when the Company satisfies each performance obligation.

The Company only applies the five-step model to contracts when it is probable that it will collect the consideration it is entitled to in exchange for the services it transfers to the customer

Commission Income

The Company derives its revenues from the placement of insurance contracts between insurance carriers and insureds. Revenues are recognized when the performance obligation of placing the policy has been met and the policy is in effect, based on the effective date of the policy. Commission income is an amount that reflects the consideration the Company expects to be entitled to in exchange for those services. The Company does not have

any significant financing components. Costs incurred to place a contract are expensed as incurred. The Company incurs costs to place the contracts, primarily through commissions paid to agents.

The Company’s customers are insurance carriers, as the Company acts as an agent to the insureds to identify a policy and carrier that best meets the needs of the insured. The Company contracts with various insurance carriers and earns commissions for the initial term of the policy on policies placed with insurance carriers. Contracts with the insurance carriers are non-exclusive and can typically be terminated unilaterally by either party. Additionally, the Company and the insurance carrier can agree to amend provisions in the contracts relating to the prospective commission rates paid to the Company for new policies sold.

Revenue from performance obligations is satisfied at the point in time in which the current term of the policy is placed and effective. These contracts are sold by the Company on behalf of the insurance carriers to the policyholder. For performance obligations related to the placement of insurance contracts, control transfers to the policyholder at a point in time at which all performance obligations have been fulfilled as evidenced by the binding of a policy. Commissions are established by contract between the Company and the insurance carrier and are calculated as a percentage of premium for the underlying insurance contract. The Company records revenue when the underlying insurance contracts are bound for the commission expected to be received for the current term of the policy, net of any estimated refunds due to policy cancellations. Commissions related to renewed policies are recognized at the time the policy renews and the new policy becomes effective. The only material promise to be performed by the Company is to sell the policy. While agreements may indicate certain administrative support such as to provide the underlying insured with policy information, such promises are immaterial in the context of the contract and are not identified as performance obligations. Additionally, the Company has concluded that they are required to “re-sell” the policy on an annual basis. As a result, a performance obligation exists for each policy term. This coincides with the efforts of placing renewed policies with the insurance carrier.

The transaction price is the total commission the Company expects to receive from the insurance carrier for the current term of the policy. The transaction date is determined by the effective date of the insurance policy. Policies are subject to cancellation at the discretion of the insured, and such a cancellation would result in the Company’s commission being limited to the period that the policy was in force. The Company estimates any expected variable consideration, endorsements, or cancellations, based on historical information and data collected from external sources, at the time revenue is recorded.

Contingent Income

Contingent income is earned from the insurance carriers to drive incremental policy sales when the Company meets or exceeds certain premium volumes and/or falls below specific loss ratio quotas predetermined by its insurance carriers. The Company utilizes the expected value approach to estimate contingent income that incorporates a combination of historical payment data by insurance carriers and the current-year production forecast data used to estimate the amount of contingent income expected to be received from the insurance carriers. Because of the uncertainty regarding the amount estimated to be received, the Company constrains the recognition of contingent income until information from the insurance carrier regarding the amount owed by the insurance carriers to the Company is received and is probable to avoid reversal of contingent income in the future period. The uncertainty regarding the estimated contingent income is primarily in the profitability of the insurance policies placed, as determined by the loss ratios maintained by the insurance carriers. The uncertainty is resolved upon receiving notification from the insurance carrier regarding actual profitability results. Contingent income is not refundable.

Fee Income and Other Income

Fee Income

Fee income is comprised primarily of policy fees, branch fees, license fees and third-party administrator (“TPA”) fees.

The Company receives policy fees as compensation for administrative services performed in connection with the placement and issuance of certain policies that are in addition to and separate from commissions paid by the insurance carriers. Policy fees are recognized at the point in time in which an insurance policy is bound and issued on the effective date of certain policies. Policy fees are not refundable.

Branch fees include the monthly recurring fees assessed for the ongoing customer service and back-office support provided to independent branches operating exclusively through the Company pursuant to an exclusive branch agreement and a one-time branch onboarding fee. The Company’s performance obligation related to branch fees is largely satisfied, and the related revenue is recognized at a point in time, when the services are rendered, typically monthly. Branch fees are deducted from the monthly commissions paid to the branch.

License fees include usage-based fees, which are typically priced as a specified fee per user and assessed by the Company for the use of its proprietary applications. The Company’s performance obligation related to license fees is largely satisfied, and the related revenue is recognized at a point in time, when the services are rendered, typically monthly.

TPA fees are related to services performed based on service agreements with a few insurance carriers. Revenues associated with TPA fees are recognized at a point in time, when the services are performed, which is typically monthly.

Other Income

Other income is comprised primarily of income earned for facilitating premium financing arrangements, fees assessed for agent conventions, interest income, and other miscellaneous income.

Cash and Cash Equivalents

Cash and cash equivalents primarily include demand deposits with financial institutions and highly liquid investments with original maturities of three months or less that are not managed by external or internal investment advisors.

Restricted Cash

In certain cases, the Company collects premiums from insureds and, after deducting our commissions and fees, remits the premiums to insurance carriers. The Company also collects surplus line taxes for remittance to state taxing authorities. Additionally, the Company has an agreement with certain insurance carriers whereby it remits claim payments and/or premium refunds to the insured on behalf of the insurance carriers. While the Company is in possession of the premiums, claims payments and surplus line taxes, the Company may invest those funds in interest-bearing demand deposit accounts with banks, in which interest income on these unremitted amounts is included in Other income in the Condensed Consolidated Statements of Operations. These unremitted amounts are reported as Restricted cash in the Condensed Consolidated Statements of Financial Position. Restricted cash amounting to $10.8 million and $7.2 million as of June 30, 2024 and December 31, 2023, respectively, is comprised of interest-bearing bank deposits.

In its role as an insurance intermediary, the Company collects and remits amounts between the insureds and insurance carriers. Because these amounts are collected on behalf of third parties, they are excluded from the measurement of the transaction price when applying the revenue recognition guidance. Similarly, the Company excludes surplus lines taxes from the measurement of the transaction price, as these are assessed by and remitted to governmental authorities. The Company recognizes the amounts collected on behalf of others, including insureds and insurance carriers, as Accounts receivable and the associated Carrier liabilities on the Condensed Consolidated Statements of Financial Position. The Company does not have any rights or obligations in connection with these amounts with the exception of segregating these amounts from the Company's operating funds and paying them when they are due.

As of June 30, 2024 and December 31, 2023, the Company reported Carrier liabilities amounting to $15.2 million and $8.7 million, respectively. Carrier liabilities are recognized based on premiums written, while Restricted cash is recorded based on premiums collected. This basis difference, coupled with the timing of settling the commissions and fees on collected premiums, resulted in differences between the amount reported in Restricted cash and Carrier liabilities.

Receivables

Commissions receivable represents commissions earned but outstanding along with the estimated contingent commissions.

Accounts receivable represents premiums billed by TWFG-GA on behalf of certain insurance carriers. These amounts, less commission, are remitted to the insurance carriers upon collection.

Allowance for Credit Losses

On January 1, 2023, the Company adopted the current expected credit losses methodology (“CECL”) for estimating allowances for credit losses for most financial assets. The Company adopted the CECL methodology using a modified retrospective method, which requires a cumulative effect adjustment to its opening retained earnings. Upon adoption of the CECL methodology, the Company recorded a total allowance for credit losses of $0.3 million,

which was primarily related to Receivables from agents, included in Other current assets, net, in the Condensed Consolidated Statements of Financial Position, and to a lesser extent, Commissions receivable.

The allowance for credit losses is maintained on Commissions receivable and Receivables from agents, included in Other current assets, net, in the Condensed Consolidated Statements of Financial Position. The determination of the credit allowance is based on a quarterly evaluation of each of these receivables, including general economic conditions and estimated collectability. The Company evaluates the collectability of its receivables based on a combination of credit quality indicators, including, but not limited to, payment status, historical charge-offs, and financial strength of the insurance carriers for Commissions receivable, and production performance and age of balances for Receivables from agents. A receivable is considered to have deteriorated in credit quality when, based on current information and events, it is probable that the Company will be unable to collect all amounts due

Intangible Assets

Intangible assets are stated at cost, less accumulated amortization, and consist of computer software development costs, non-compete agreements, and purchased customer lists. Computer software development costs are amortized on the straight-line method over three or five years. Non-compete agreements are amortized on the straight-line method over the term of the non-compete agreements. Customer lists represent amounts paid by insurance agencies to buy a list of active policies or insureds. As these policies renew, the Company realizes an income stream from commissions. Customer lists are amortized on the straight-line method over eight to ten years.

The Company acquires intangible assets in connection with acquisition transactions. In each acquisition transaction, the Company assesses whether the transaction should follow accounting guidance applicable to an asset acquisition or a business combination. This assessment requires an evaluation of whether the fair value of the gross assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets, resulting in an asset acquisition or, if not, resulting in a business combination. An asset acquisition is an acquisition of an asset, or a group of assets, that does not meet the definition of a business.

The Company accounts for asset acquisitions using the cost accumulation and allocation model, whereby the costs of acquisition are allocated to the assets acquired on a relative fair value basis in accordance with the Company’s accounting policies. The acquired intangible assets are recorded at fair value, which is determined based on multiples of revenue or Adjusted EBITDA, growth rates, and loss ratios of the intangible assets acquired. The methods and assumptions used to determine the purchase price and the estimated useful lives of intangible assets require significant judgment.

Intangible assets are evaluated for impairment whenever events or changes in circumstances indicate that the carrying value may no longer be recoverable. If indicators of impairment exist, the Company assesses the recoverability of its intangible assets by reviewing the estimated future undiscounted cash flows generated by the corresponding asset or asset group. If based on the assessment, the Company determines that the intangible assets are impaired, such assets are written down to their fair values with the related impairment losses recognized in the Condensed Consolidated Statements of Operations. There were no impairments recorded for the three and six months ended June 30, 2024 and 2023.

Property and Equipment

Property and equipment are recorded at cost, less accumulated depreciation. Maintenance, minor repairs, and replacements are charged directly to expense as incurred, while major renewals and betterments are capitalized. When property and equipment are sold or otherwise disposed of, the asset accounts and related accumulated depreciation accounts are relieved, and any gain or loss is included in the results of operations.

Property and equipment are depreciated using the straight-line method over the estimated useful lives of the assets as follows:


			Useful Life
Automobiles			5 years
Computer equipment			5 years
Furniture and fixtures			7 years
Leasehold improvements			Lesser of the estimated useful life or the underlying lease term
Office equipment			5 - 7 years

Property and equipment are evaluated for impairment whenever events or changes in circumstances indicate that the carrying value may no longer be recoverable. If indicators of impairment exist, the Company assesses its recoverability by reviewing the estimated future undiscounted cash flows generated by the corresponding asset or asset group. If based on the assessment, the Company determines that the property and equipment are impaired, such assets are written down to their fair values with the related impairment losses recognized in the result of operations. There were no impairments recorded for the three and six months ended June 30, 2024 and 2023.

Assets for disposal are reported at the lower of the carrying value or fair value, less costs to sell.

Deferred Offering Costs

Deferred offering costs, which consist of direct incremental legal, accounting, consulting, and other fees and expenses related to the IPO were capitalized in Deferred offering costs on the Condensed Consolidated Statements of Financial Position. The deferred offering costs were offset against IPO proceeds upon the consummation of an IPO.

Commissions Payable

Commissions payable represents commissions due to agents for services provided for the placement of insurance contracts. The Company records the commission expense and the related commissions payable on the effective date of the policy based on the estimated total premium for the term of the policy adjusted for any expected variable consideration, endorsements or cancellations based on historical information at the time the expense is recorded.

Leases

The Company evaluates contracts entered into to determine whether the contract involves the use of an identified asset. The Company then evaluates whether it obtains substantially all economic benefits from the use of the asset, and whether it has the right to direct the use of the asset. If these criteria are met and a lease has been identified, the Company accounts for the contract under the requirements of the Accounting Standards Codification (“ASC”) 842, Leases.

The Company's leased assets consist primarily of real estate for occupied offices and office equipment. Leases with a lease term of 12 months or less at inception are not recorded on the Condensed Consolidated Statements of Financial Position and are expensed on a straight-line basis over the lease term. The Company determines the lease term by assessing the renewal options with the lessor and includes lease extension (or termination) options only when options are reasonably certain of being (or not being) exercised. All of the Company’s real estate and office equipment leases are recognized as operating leases. The Company does not sublease any of its leases. The Company elected the practical expedient to not separate non-lease and lease components and rather account for them as a single lease component of the underlying assets. The Company has no variable lease payments in any of its leases.

The Company recognizes lease right-of-use (“ROU”) assets and operating lease liabilities on the Condensed Consolidated Statements of Financial Position for operating lease agreements. Lease liabilities are measured at the lease commencement date as the present value of the future lease payments determined. As the interest rate implicit in the lease is not readily determinable, the Company uses its incremental borrowing rate on the lease commencement date. ROU assets are measured as the lease liability plus initial direct costs and prepaid lease payments less lease incentives

Derivatives

The Company uses derivative financial instruments, i.e., interest rate swaps, to manage its interest rate exposure associated with some of its borrowings. The Company does not hold or issue derivative instruments for trading or speculative purposes. Derivative instruments are recognized as assets or liabilities at fair value on the Condensed Consolidated Statements of Financial Position.

At the inception of the hedging relationship, the Company formally documents its designation of the hedge as a cash flow hedge and the risk management objective and strategy for undertaking the hedging transaction. The Company identifies how the hedging instrument is expected to hedge the designated risks related to the hedged item and the method that will be used to retrospectively and prospectively assess the hedge effectiveness and the method which will be used to measure ineffectiveness. A derivative designated as a hedging instrument must be assessed as being highly effective in offsetting the designated risk of the hedged item. Hedge effectiveness is formally assessed at inception and periodically throughout the life of the hedge accounting relationship. For derivative instruments designated as a cash flow hedge, all changes in the fair value of the hedging derivative are reported within accumulated other comprehensive income and the related gains or losses on the derivative are reclassified into earnings when the cash flows of the hedged item affect earnings. For a derivative not designated as a hedge, changes in the derivative’s fair value and any income received or paid on derivatives at the settlement date are included in earnings. See Note 6 for additional information about the Company’s derivative instruments.

The Company discontinues hedge accounting prospectively when: (1) it determines the derivative is no longer highly effective in offsetting changes in the estimated cash flows of a hedged item; (2) the derivative expires, is sold, terminated, or exercised; or (3) the derivative is de-designated as a hedging instrument. When hedge accounting is discontinued, the derivative continues to be carried on the Condensed Consolidated Statements of Financial Position at fair value, with changes in fair value recognized in earnings.

Fair Value Measurements

ASC 820, Fair Value Measurement, establishes a fair value hierarchy that prioritizes and ranks the level of observability of inputs used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level I measurements) and the lowest priority to unobservable inputs (Level III measurements).

The three levels of the fair value hierarchy under ASC 820 are as follows:

Level I – Observable inputs such as quoted prices for identical assets in active markets;

Level II – Inputs other than quoted prices for identical assets in active markets, that are observable either directly or indirectly; and

Level III – Unobservable inputs in which there is little or no market data which requires the use of valuation techniques and the development of assumptions.

The carrying amount of financial assets and liabilities reported in the Condensed Consolidated Statements of Financial Position for Cash and cash equivalents, Restricted cash, Commissions receivable, Accounts receivable, Other current assets, Commissions payable, Carrier liabilities, Accounts payable and accrued liabilities, and Other current liabilities at June 30, 2024 and December 31, 2023, approximate fair value because of the short-term duration of these instruments.

Income Taxes

The Company is a limited liability company and has elected to be treated as a partnership for federal tax purposes. The Company is taxed under Section 701 of the Internal Revenue Code, which provides that items of income, deductions, and credits are “passed through” and taxed at the partner level. As a result, a provision or liability for federal income tax is not reflected in the condensed consolidated financial statements. However, TWICO is subject to federal income tax and records a provision or liability for federal income tax purposes, which is reported in the condensed consolidated financial statements as part of the discontinued operation.

Segment

The Company operates its business as a single operating and reportable segment, which is consistent with how its chief operating decision maker (“CODM”) reviews financial performance and allocates resources.

Recent Accounting Pronouncements Not Yet Adopted

Segment Reporting

In November 2023, the FASB issued an accounting standard that is intended to improve reportable segment disclosure requirements. The standard requires disclosures to include significant segment expenses that are regularly provided to the CODM, a description of other segment items by reportable segment, and any additional measures of a segment's profit or loss used by the CODM when deciding how to allocate resources. The ASU also requires all annual disclosures currently required by the standard to be included in interim periods. The update is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted and requires retrospective application to all prior periods presented in the financial statements. The Company intends to adopt the new standard in its annual consolidated financial statements as of and for the year ending December 31, 2024. The Company expects the adoption of the standard to have a material impact on its disclosures; however, the standard will not have an impact on its Condensed Consolidated Statements of Financial Position, Operations or Cash Flows.

Income Taxes

In December 2023, the FASB issued an accounting standard that requires disaggregated income tax disclosures for specific categories on the effective tax rate reconciliation, and additional information about federal, state, local and foreign income taxes. The standard also requires annual disclosure of income taxes paid (net of refunds received), disaggregated by jurisdiction. This guidance is effective for fiscal years beginning after December 15, 2024, with early adoption permitted. The standard is to be applied on a prospective basis, although optional retrospective application is permitted. The Company is currently evaluating the impact this standard will have on its financial statement disclosures.

Condensed Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Statement of Comprehensive Income [Abstract]
Net income	$ 6,918	$ 7,067	$ 13,547	$ 13,273
Other comprehensive income (loss), net of tax:
Unrealized gains on investments of discontinued operation during the period (net of tax expense of $0 and $0 for the three months ended and $0 and $44 for the six months ended June 30, 2024 and 2023, respectively)	0	0	0	165
Unrealized gains on derivative instruments during the period	29	152	145	123
Reclassification of realized gains on derivative instruments included in net income during the period	(85)	(104)	(178)	(201)
Total other comprehensive (loss) income, net of tax	(56)	48	(33)	87
Comprehensive income	$ 6,862	$ 7,115	$ 13,514	$ 13,360

- Definition

Amount after tax of increase (decrease) in equity from transactions and other events and circumstances from net income and other comprehensive income, attributable to parent entity. Excludes changes in equity resulting from investments by owners and distributions to owners.

+ References + Details

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References

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+ Details

Cover - shares	6 Months Ended
Cover - shares	Jun. 30, 2024	Aug. 26, 2024
Entity Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jun. 30, 2024
Document Transition Report	false
Entity File Number	000-00000
Entity Registrant Name	TWFG, Inc.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	99-0603906
Entity Address, Address Line Two	Suite 4020
Entity Address, Address Line One	1201 Lake Woodlands Drive
Entity Address, City or Town	The Woodlands
Entity Address, State or Province	TX
Entity Address, Postal Zip Code	77380
City Area Code	281
Local Phone Number	367-3424
Title of 12(b) Security	Class A Common Stock, $0.01 par value per share
Trading Symbol	TWFG
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
Entity Shell Company	false
Entity Central Index Key	0002007596
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	Q2
Amendment Flag	false
Class A
Entity Information [Line Items]
Entity Common Stock, Shares Outstanding		14,811,874
Class B
Entity Information [Line Items]
Entity Common Stock, Shares Outstanding		7,277,651
Class C
Entity Information [Line Items]
Entity Common Stock, Shares Outstanding		33,893,810

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

6 Months Ended

Jun. 30, 2024

Accounting Policies [Abstract]

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Revenue Recognition

The Company only applies the five-step model to contracts when it is probable that it will collect the consideration it is entitled to in exchange for the services it transfers to the customer.

Commission Income

any significant financing components. Costs incurred to place a contract are expensed as incurred. The Company incurs costs to place the contracts, primarily through commissions paid to agents.

Contingent Income

Fee Income

Fee income is comprised primarily of policy fees, branch fees, license fees and third-party administrator (“TPA”) fees.

Other Income

Other income is comprised primarily of income earned for facilitating premium financing arrangements, fees assessed for agent conventions, interest income, and other miscellaneous income.

Cash and Cash Equivalents

Restricted Cash

Receivables

Commissions receivable represents commissions earned but outstanding along with the estimated contingent commissions.

Accounts receivable represents premiums billed by TWFG-GA on behalf of certain insurance carriers. These amounts, less commission, are remitted to the insurance carriers upon collection.

Allowance for Credit Losses

No allowance for credit losses was required related to Accounts receivable as of June 30, 2024 and December 31, 2023.

Intangible Assets

Property and Equipment

Property and equipment are depreciated using the straight-line method over the estimated useful lives of the assets as follows:


			Useful Life
Automobiles			5 years
Computer equipment			5 years
Furniture and fixtures			7 years
Leasehold improvements			Lesser of the estimated useful life or the underlying lease term
Office equipment			5 - 7 years

Assets for disposal are reported at the lower of the carrying value or fair value, less costs to sell.

Deferred Offering Costs

Commissions Payable

Leases

Derivatives

Fair Value Measurements

The three levels of the fair value hierarchy under ASC 820 are as follows:

Level I – Observable inputs such as quoted prices for identical assets in active markets;

Level II – Inputs other than quoted prices for identical assets in active markets, that are observable either directly or indirectly; and

Level III – Unobservable inputs in which there is little or no market data which requires the use of valuation techniques and the development of assumptions.

Members’ Equity

In May 2023, the Company amended and restated its limited liability company agreement and created three classes of membership interests — Class A common units with one vote per unit, Class B common units with one vote per unit, and Class C common units with 10 votes per unit (see Note 1). Before the amendment that created the three classes of membership interests, the Company had one class of membership interest, and each unit was entitled to one vote per unit.

In December 2023, the A&R LLC Agreement was amended to provide that, to the extent permitted by applicable law and subject to any restrictions in any credit agreement, to the extent the Company had available cash, the Board of Managers would at least annually make a distribution to its members in an amount sufficient to allow each member to pay all U.S., state and local income taxes on income expected to be allocated to each member.

Under the amended A&R LLC Agreement, other than mandatory tax distributions as described above, distributions to unitholders would be made only in such amounts and at such times as determined by the Company’s Board of Managers in its sole and absolute discretion. Distributions, if declared by the Company’s Board of Managers, would be made to all common members in proportion to their relative common units. Upon a liquidation event, certain Class B unitholders would receive preference for any distribution or other payment, which were equivalent to their preferred liquidation amount. Once the preferred liquidation amount was fully paid, any distribution made to common unit members would be in proportion to their relative common units, provided any such distribution to certain Class B unitholders was net of the preferred liquidation amount. The A&R LLC Agreement was subsequently amended in connection with the reorganization transactions.

Income Taxes

Segment

Recent Accounting Pronouncements Not Yet Adopted

Segment Reporting

Income Taxes

Condensed Consolidated Statements of Operations (Parenthetical) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Total revenues	$ 53,266	$ 45,376	$ 99,579	$ 85,232
Other administrative expenses	3,744	2,736	6,874	5,231
Commission income
Total revenues	48,662	41,771	91,207	78,458
Fee Income
Total revenues	2,689	2,208	4,921	4,236
Related Party
Total revenues	1,912	947	3,021
Other administrative expenses	382	99	783	92
Related Party \| Commission income
Total revenues				1,897
Related Party \| Fee Income
Total revenues	$ 561	$ 411	$ 915	$ 839

- Definition

+ References

+ Details

DEBT - Narrative (Details) - USD ($) $ in Thousands			1 Months Ended		3 Months Ended		6 Months Ended		12 Months Ended
DEBT - Narrative (Details) - USD ($) $ in Thousands	Dec. 04, 2020	Jul. 30, 2019	Mar. 31, 2024	Apr. 30, 2023	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023	Dec. 31, 2023	May 23, 2023
Debt Instrument [Line Items]
Interest expense					$ 872	$ 173	$ 1,714	$ 258
Additions							$ 47,209		$ 21,807
Ralph E. Wade Insurance Agency Inc.
Debt Instrument [Line Items]
Cash paid				$ 3,000
March 2024 Acquisition
Debt Instrument [Line Items]
Asset acquisition, debt issuance			$ 400
Notes Payable, Other Payables \| Acquisition Related Notes \| Ralph E. Wade Insurance Agency Inc.
Debt Instrument [Line Items]
Term loan (in years)				3 years
Debt instrument interest rate percentage				3.75%
Notes Payable, Other Payables \| Acquisition Related Notes \| March 2024 Acquisition
Debt Instrument [Line Items]
Term loan (in years)			70 months
Imputed interest rate			5.00%
Term Loan \| Line of Credit \| 5-Year Term Loan
Debt Instrument [Line Items]
Term loan (in years)	7 years	5 years					5 years
Debt instrument, face amount	$ 13,000	$ 4,000
Revolving Credit Facility \| Line of Credit
Debt Instrument [Line Items]
Term loan (in years)							5 years
Maximum borrowing capacity										$ 50,000
Revolving Credit Facility \| Line of Credit \| Minimum
Debt Instrument [Line Items]
Commitment fee percent							0.20%
Revolving Credit Facility \| Line of Credit \| Maximum
Debt Instrument [Line Items]
Commitment fee percent							0.35%
Revolving Credit Facility \| Line of Credit \| Revolving Facility
Debt Instrument [Line Items]
Remaining borrowing capacity					$ 9,000		$ 9,000		$ 9,000
Revolving Credit Facility \| Line of Credit \| Revolving Facility \| Minimum
Debt Instrument [Line Items]
Commitment fee percent							0.20%
Revolving Credit Facility \| Line of Credit \| Revolving Facility \| Maximum
Debt Instrument [Line Items]
Commitment fee percent							0.35%

DEBT - Schedule of Maturities of Long-Term Debt (Details) $ in Thousands	Jun. 30, 2024 USD ($)
Debt Disclosure [Abstract]
Reminder of 2024	$ 1,412
2025	2,416
2026	2,473
2027	2,209
2028	41,063
Thereafter	60
Total	$ 49,633

- Definition

Amount, after deduction of unamortized premium (discount) and debt issuance cost, of long-term debt. Excludes lease obligation.

+ References + Details

Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended				6 Months Ended
Pay vs Performance Disclosure - USD ($) $ in Thousands	Jun. 30, 2024	Mar. 31, 2024	Jun. 30, 2023	Mar. 31, 2023	Jun. 30, 2024	Jun. 30, 2023
Pay vs Performance Disclosure
Net income	$ 6,918	$ 6,629	$ 7,067	$ 6,206	$ 13,547	$ 13,273

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References

+ Details