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Selective Reports Third Quarter 2024 Results

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Selective Insurance Group, Inc. (NASDAQ: SIGI) reported third quarter 2024 results with net income of $1.47 per diluted common share and non-GAAP operating income of $1.40 per diluted common share. The company achieved a Return on Common Equity (ROE) of 12.6% and a non-GAAP Operating ROE of 12.1%. Key highlights include:

- Net premiums written (NPW) increased 9% from Q3 2023
- GAAP combined ratio was 99.5%, up from 96.8% in Q3 2023
- Net catastrophe losses increased the combined ratio by 13.4 points
- Commercial Lines renewal pure price increases averaged 9.1%
- After-tax net investment income was $93 million, up 16% year-over-year
- Book value per common share increased 9% to $48.82
- Quarterly dividend increased 9% to $0.38 per common share

The company maintained a strong capital position and expanded its Standard Commercial Lines footprint to 35 states. Despite elevated catastrophe losses, Selective reported solid underlying performance, reflecting disciplined underwriting and pricing actions.

Selective Insurance Group, Inc. (NASDAQ: SIGI) ha riportato i risultati del terzo trimestre 2024 con un utile netto di $1.47 per azione comune diluita e un utile operativo non-GAAP di $1.40 per azione comune diluita. L'azienda ha raggiunto un Return on Common Equity (ROE) del 12,6% e un ROE operativo non-GAAP del 12,1%. I punti salienti includono:

- I premi netti scritti (NPW) sono aumentati del 9% rispetto al terzo trimestre 2023
- Il rapporto combinato GAAP era del 99,5%, in aumento rispetto al 96,8% nel terzo trimestre 2023
- Le perdite catastrofiche nette hanno aumentato il rapporto combinato di 13,4 punti
- Gli aumenti dei prezzi puri nel rinnovo delle linee commerciali sono stati mediamente del 9,1%
- L'utile netto da investimenti dopo le tasse è stato di 93 milioni di dollari, con un aumento del 16% rispetto all'anno precedente
- Il valore contabile per azione comune è aumentato del 9% a $48.82
- Il dividendo trimestrale è aumentato del 9% a $0.38 per azione comune

L'azienda ha mantenuto una solida posizione di capitale e ha ampliato la sua presenza nelle linee commerciali standard a 35 stati. Nonostante le elevate perdite catastrofiche, Selective ha riportato una solida performance di base, riflettendo un'underwriting disciplinato e azioni di pricing.

Selective Insurance Group, Inc. (NASDAQ: SIGI) reportó resultados del tercer trimestre de 2024 con un ingreso neto de $1.47 por acción común diluida y un ingreso operativo no GAAP de $1.40 por acción común diluida. La compañía alcanzó un Return on Common Equity (ROE) del 12.6% y un ROE operativo no GAAP del 12.1%. Los puntos destacados incluyen:

- Las primas netas escritas (NPW) aumentaron un 9% en comparación con el tercer trimestre de 2023
- El ratio combinado GAAP fue del 99.5%, en comparación con el 96.8% en el tercer trimestre de 2023
- Las pérdidas netas por catástrofes aumentaron el ratio combinado en 13.4 puntos
- Los aumentos de precios puros en la renovación de líneas comerciales promediaron el 9.1%
- Los ingresos netos por inversiones después de impuestos fueron de 93 millones de dólares, un aumento del 16% interanual
- El valor contable por acción común aumentó un 9% a $48.82
- El dividendo trimestral aumentó un 9% a $0.38 por acción común

La compañía mantuvo una sólida posición de capital y amplió su presencia en las líneas comerciales estándar a 35 estados. A pesar de las elevadas pérdidas por catástrofes, Selective reportó un sólido rendimiento subyacente, reflejando una suscripción disciplinada y acciones de fijación de precios.

Selective Insurance Group, Inc. (NASDAQ: SIGI)는 2024년 3분기 실적을 보고하며 희석된 보통주 1주당 순이익이 $1.47, 비-GAAP 운영수익이 $1.40이라고 발표했습니다. 회사는 12.6%의 보통주 자본 수익률(ROE)과 비-GAAP 운영 ROE 12.1%를 달성했습니다. 주요 사항은 다음과 같습니다:

- 순보험료 적립(NPW)은 2023년 3분기 대비 9% 증가했습니다
- GAAP 결합 비율은 99.5%로, 2023년 3분기 96.8%에서 증가했습니다
- 순재해 손실로 인해 결합 비율이 13.4포인트 증가했습니다
- 상업라인 갱신 순가격 증가는 평균 9.1%로 나타났습니다
- 세후 순투자 소득은 9천3백만 달러로, 전년도 대비 16% 증가했습니다
- 보통주당 장부 가치는 9% 증가한 $48.82입니다
- 분기 배당금은 9% 증가하여 보통주당 $0.38이 되었습니다

회사는 강력한 자본 위치를 유지를 하였고 표준 상업 라인의 발자국을 35개 주로 확장했습니다. 높은 재해 손실에도 불구하고, Selective는 엄격한 언더라이팅과 가격 책정 조치를 반영하여 양호한 기본 성과를 보고했습니다.

Selective Insurance Group, Inc. (NASDAQ: SIGI) a rapporté les résultats du troisième trimestre 2024 avec un revenu net de 1,47 USD par action ordinaire diluée et un revenu opérationnel non-GAAP de 1,40 USD par action ordinaire diluée. L'entreprise a atteint un Retour sur Fonds Propres (ROE) de 12,6% et un ROE opérationnel non-GAAP de 12,1%. Les points clés comprennent :

- Les primes nettes souscrites (NPW) ont augmenté de 9% par rapport au troisième trimestre 2023
- Le ratio combiné GAAP était de 99,5%, en hausse par rapport à 96,8% au troisième trimestre 2023
- Les pertes nettes dues aux catastrophes ont augmenté le ratio combiné de 13,4 points
- Les augmentations de prix pur des renouvellements des lignes commerciales ont atteint en moyenne 9,1%
- Le revenu net des investissements après impôts était de 93 millions USD, en hausse de 16% par rapport à l'année précédente
- La valeur comptable par action ordinaire a augmenté de 9% pour atteindre 48,82 USD
- Le dividende trimestriel a augmenté de 9% pour atteindre 0,38 USD par action ordinaire

L'entreprise a maintenu une solide position en capital et a élargi son empreinte dans les lignes commerciales standard à 35 États. Malgré des pertes importantes dues aux catastrophes, Selective a rapporté une performance sous-jacente solide, reflétant une souscription et des actions de tarification disciplinées.

Selective Insurance Group, Inc. (NASDAQ: SIGI) berichtete über die Ergebnisse des dritten Quartals 2024 mit einem Nettogewinn von 1,47 USD pro verwässerter Stammaktie und einem nicht-GAAP Betriebsergebnis von 1,40 USD pro verwässerter Stammaktie. Das Unternehmen erreichte eine Eigenkapitalrendite (ROE) von 12,6% und eine nicht-GAAP Betriebseigenkapitalrendite von 12,1%. Zu den wichtigsten Punkten gehören:

- Die netto geschriebenen Prämien (NPW) stiegen um 9% im Vergleich zum 3. Quartal 2023
- Das GAAP kombinierte Verhältnis betrug 99,5%, gegenüber 96,8% im 3. Quartal 2023
- Netto-Katastrophenschäden erhöhten das kombinierte Verhältnis um 13,4 Punkte
- Die reinen Preiserhöhungen bei der Erneuerung von gewerblichen Linien lagen im Durchschnitt bei 9,1%
- Nachsteuerlicher Nettoanlageertrag betrug 93 Millionen USD, ein Anstieg von 16% im Vergleich zum Vorjahr
- Der Buchwert pro Stammaktie stieg um 9% auf 48,82 USD
- Die vierteljährliche Dividende wurde um 9% auf 0,38 USD pro Stammaktie erhöht

Das Unternehmen hielt eine starke Kapitalposition aufrecht und erweiterte seine Präsenz im Standard-Gewerbeversicherungsbereich auf 35 Bundesstaaten. Trotz erhöhter Katastrophenschäden berichtete Selective von einer soliden Grundleistung, was auf diszipliniertes Underwriting und Preisstrategie hindeutet.

Positive
  • Net premiums written (NPW) increased 9% year-over-year
  • After-tax net investment income grew 16% to $93 million
  • Book value per common share increased 9% to $48.82
  • Commercial Lines renewal pure price increases averaged 9.1%, up 2.0 points from Q3 2023
  • Quarterly dividend increased 9% to $0.38 per common share
  • Expanded Standard Commercial Lines footprint to 35 states
Negative
  • GAAP combined ratio increased to 99.5% from 96.8% in Q3 2023
  • Net catastrophe losses increased the combined ratio by 13.4 points, up from 6.6 points in Q3 2023
  • Non-GAAP operating income per diluted common share decreased 7% year-over-year
  • Standard Personal Lines segment reported a combined ratio of 122.1%
  • Increased full-year 2024 expected GAAP combined ratio to 102.5% from previous guidance of 101.5%

Insights

Selective Insurance Group's Q3 2024 results show a mixed performance. Net income per diluted share increased 4% to $1.47, while non-GAAP operating income decreased 7% to $1.40 per share. The company achieved a solid 12.6% ROE and 12.1% non-GAAP operating ROE.

Key positives include:

  • Net premiums written grew 9% year-over-year, driven by accelerating renewal pure price increases
  • After-tax net investment income rose 16% to $93 million
  • Book value per share increased 9% to $48.82

However, challenges were evident:

  • The GAAP combined ratio deteriorated to 99.5% from 96.8% a year ago
  • Elevated catastrophe losses of $149 million increased the combined ratio by 13.4 points

The company's focus on disciplined pricing and underwriting is evident, with Standard Commercial Lines renewal pure price increasing to 9.1%. Despite headwinds, Selective maintains a strong capital position and is expanding its footprint. The increased quarterly dividend of $0.38 per share reflects confidence in the company's financial strength.

Selective's Q3 results highlight the ongoing challenges in the property and casualty insurance sector, particularly the impact of severe weather events. The frequency and severity of storms, including Hurricane Helene, resulted in $149 million of catastrophe losses, significantly affecting the combined ratio.

The company's response to these challenges is noteworthy:

  • Accelerating renewal pure price increases, especially in General Liability (10.2%)
  • Maintaining disciplined underwriting, with stable retention in Standard Commercial Lines (86%)
  • Expanding into new states (Nevada, Oregon and Washington) for Standard Commercial Lines

The personal lines segment shows signs of strain, with a 122.1% combined ratio, although improved from last year. The Excess and Surplus Lines segment performed well with an 83.2% combined ratio and 28% premium growth.

Selective's updated guidance for 2024, with an expected GAAP combined ratio of 102.5%, reflects the ongoing challenges in the industry. The company's ability to maintain pricing discipline while managing retention will be important in navigating the uncertain external environment and achieving its long-term 95% combined ratio target.

Net Income of $1.47 per Diluted Common Share and Non-GAAP Operating Income1 of $1.40 per Diluted Common Share; Return on Common Equity ("ROE") of 12.6% and Non-GAAP Operating ROE1 of 12.1%

Quarterly Dividend Increased 9% to $0.38 per Common Share

In the third quarter of 2024:

  • Net premiums written ("NPW") increased 9% from the third quarter of 2023;
  • The GAAP combined ratio was 99.5%, compared to 96.8% in the third quarter of 2023;
  • Net catastrophe losses increased the GAAP combined ratio by 13.4 points, compared to 6.6 points in the third quarter of 2023;
  • Commercial Lines renewal pure price increases averaged 9.1%, up 2.0 points from 7.1% in the third quarter of 2023;
  • After-tax net investment income was $93 million, up 16% from the third quarter of 2023;
  • Book value per common share was $48.82, up 9% from last quarter; and
  • Adjusted book value per common share1 was $50.80, up 2% from last quarter.

BRANCHVILLE, N.J.--(BUSINESS WIRE)-- Selective Insurance Group, Inc. (NASDAQ: SIGI) reported financial results for the third quarter ended September 30, 2024, with net income per diluted common share of $1.47 and non-GAAP operating income1 per diluted common share of $1.40. Return on common equity was 12.6% and non-GAAP operating ROE1 was 12.1%.

NPW increased 9% from a year ago driven by accelerating renewal pure price increases and stable Standard Commercial Lines retention. The investments segment generated 13.1 points of annualized ROE in the quarter, as after-tax net investment income was $93 million, up 16% from a year ago.

For the quarter, Selective reported a combined ratio of 99.5% with no net prior year casualty reserve development. Elevated catastrophe losses of $149 million increased the combined ratio by 13.4 points, up from 6.6 points a year ago. Losses resulted from 19 named storms in the quarter, with Hurricane Helene estimated at $85 million of pre-tax losses.

“The continued frequency and severity of storms in the third quarter, including the devastation from Hurricane Helene, underscore our unwavering commitment to our customers, agency partners, and communities. During these challenging times for those impacted by the storms, I thank my colleagues for continuing to deliver superior claims service and supporting customers and claimants,” said John J. Marchioni, Chairman, President and Chief Executive Officer.

“We maintain a disciplined approach to pricing and underwriting our business. Loss trends remain elevated and uncertain, but we continue to be prudent and vigilant in addressing them. In the quarter, renewal pure price increased 10.5%. In Standard Commercial Lines, renewal pure price accelerated to 9.1%. For General Liability, the line most impacted by loss emergence in previous quarters, renewal pure price was 10.2%, up from 7.6% in the second quarter. Importantly, retention was stable in Standard Commercial Lines at 86%.”

“Our primary goal is to consistently achieve our 95% combined ratio target. Although catastrophe losses impacted the quarter, our underlying performance was excellent, reflecting our underwriting and pricing actions and disciplined expense management. We added Nevada, Oregon, and Washington to our Standard Commercial Lines footprint in early October, now covering 35 states. With our strong capital position, financial flexibility, and strategic execution, we are well positioned to face the uncertainty in the external environment,” concluded Mr. Marchioni.

Operating Highlights

Consolidated Financial Results

Quarter ended

September 30,

Change

Year-to-Date

September 30,

Change

$ and shares in millions, except per share data

2024

2023

2024

2023

Net premiums written

$

1,157.6

 

1,058.3

 

9

 

%

$

3,540.4

 

 

3,143.0

 

13

 

%

Net premiums earned

 

1,112.2

 

981.9

 

13

 

 

 

3,243.4

 

 

2,826.4

 

15

 

 

Net investment income earned

 

117.8

 

100.9

 

17

 

 

 

334.3

 

 

290.1

 

15

 

 

Net realized and unrealized gains (losses), pre-tax

 

5.4

 

(6.9

)

(178

)

 

 

5.1

 

 

(9.0

)

(156

)

 

Total revenues

 

1,244.3

 

1,081.1

 

15

 

 

 

3,605.3

 

 

3,121.4

 

16

 

 

Net underwriting income (loss), after-tax

 

4.1

 

25.0

 

(83

)

 

 

(118.0

)

 

54.7

 

(316

)

 

Net investment income, after-tax

 

93.4

 

80.2

 

16

 

 

 

265.3

 

 

231.1

 

15

 

 

Net income (loss) available to common stockholders

 

90.0

 

86.9

 

4

 

 

 

104.6

 

 

233.5

 

(55

)

 

Non-GAAP operating income (loss)1

 

85.7

 

92.3

 

(7

)

 

 

100.6

 

 

240.6

 

(58

)

 

Combined ratio

 

99.5

%

96.8

 

2.7

 

pts

 

104.6

 

%

97.5

 

7.1

 

pts

Loss and loss expense ratio

 

68.8

 

65.8

 

3.0

 

 

 

73.8

 

 

65.7

 

8.1

 

 

Underwriting expense ratio

 

30.6

 

30.9

 

(0.3

)

 

 

30.6

 

 

31.6

 

(1.0

)

 

Dividends to policyholders ratio

 

0.1

 

0.1

 

 

 

 

0.2

 

 

0.2

 

 

 

Net catastrophe losses

 

13.4

pts

6.6

 

6.8

 

 

 

9.1

 

pts

7.8

 

1.3

 

 

Non-catastrophe property losses and loss expenses

 

13.2

 

17.6

 

(4.4

)

 

 

15.5

 

 

16.9

 

(1.4

)

 

(Favorable) unfavorable prior year reserve development on casualty lines

 

 

 

 

 

 

6.5

 

 

(0.6

)

7.1

 

 

Net income (loss) available to common stockholders per diluted common share

$

1.47

 

1.42

 

4

 

%

$

1.71

 

 

3.83

 

(55

)

%

Non-GAAP operating income (loss) per diluted common share1

 

1.40

 

1.51

 

(7

)

 

 

1.64

 

 

3.95

 

(58

)

 

Weighted average diluted common shares

 

61.3

 

61.0

 

 

 

 

61.3

 

 

60.9

 

1

 

 

Book value per common share

$

48.82

 

40.35

 

21

 

 

$

48.82

 

 

40.35

 

21

 

 

Adjusted book value per common share1

 

50.80

 

48.54

 

5

 

 

 

50.80

 

 

48.54

 

5

 

 

Overall Insurance Operations

For the third quarter, overall NPW increased 9%, or $99 million, from a year ago. Average renewal pure price increased 10.5%, up 3.5 points from a year ago. Selective's 99.5% combined ratio was 2.7 points higher than a year ago, as elevated catastrophe losses were partially offset by lower non-catastrophe property losses and a lower expense ratio. There was no net unfavorable prior year casualty reserve development in either period. The combined ratio excluding net catastrophe losses and prior year casualty reserve development was 86.1%, 4.1 points lower than a year ago.

Overall, our insurance segments increased ROE by 0.6 points in the third quarter of 2024.

Standard Commercial Lines Segment

For the third quarter, Standard Commercial Lines premiums (representing 78% of total NPW) grew 8% from a year ago. The premium growth reflected average renewal pure price increases of 9.1% and stable retention of 86%. The third quarter combined ratio was 99.2%, up 4.5 points from a year ago, primarily due to catastrophe losses.

There was no net prior year casualty reserve development in the quarter, compared to $3.0 million, or 0.4 points, of favorable development a year ago.

The following table shows the variances in key quarter-to-date and year-to date measures:

Standard Commercial Lines Segment

Quarter ended

September 30,

Change

Year-to-Date

September 30,

Change

$ in millions

2024

2023

2024

2023

Net premiums written

$

903.9

 

833.6

 

8

 

%

$

2,798.7

 

2,517.0

 

11

 

%

Net premiums earned

 

875.4

 

785.3

 

11

 

 

 

2,563.0

 

2,279.7

 

12

 

 

Combined ratio

 

99.2

%

94.7

 

4.5

 

pts

 

105.6

%

95.5

 

10.1

 

pts

Loss and loss expense ratio

 

67.6

 

62.8

 

4.8

 

 

 

74.0

 

63.0

 

11.0

 

 

Underwriting expense ratio

 

31.4

 

31.7

 

(0.3

)

 

 

31.4

 

32.3

 

(0.9

)

 

Dividends to policyholders ratio

 

0.2

 

0.2

 

 

 

 

0.2

 

0.2

 

 

 

Net catastrophe losses

 

11.5

pts

4.7

 

6.8

 

 

 

7.4

pts

5.9

 

1.5

 

 

Non-catastrophe property losses and loss expenses

 

11.0

 

15.6

 

(4.6

)

 

 

13.1

 

14.9

 

(1.8

)

 

(Favorable) unfavorable prior year reserve development on casualty lines

 

 

(0.4

)

0.4

 

 

 

8.2

 

(0.9

)

9.1

 

 

Standard Personal Lines Segment

For the third quarter, Standard Personal Lines premiums (representing 10% of total NPW) decreased 2% from a year ago with renewal pure price of 22.8% and higher average policy sizes. Retention was 75%, down 13 points from a year ago, and new business decreased 49% due to deliberate profit improvement actions. Despite elevated catastrophe losses, the third quarter 2024 combined ratio decreased by 5.3 points from a year ago to 122.1%. There was no prior year casualty reserve development in the quarter, compared to $3 million in unfavorable prior year casualty reserve development in personal auto a year ago. Flood claims handling fees from the National Flood Insurance Program's Write Your Own program, primarily related to Hurricane Helene, reduced the loss and loss expense ratio by 4.3 points in the quarter, up from 1.2 points in the prior-year period.

The following table shows the variances in key quarter-to-date and year-to-date measures:

Standard Personal Lines Segment

Quarter ended

September 30,

Change

Year-to-Date

September 30,

Change

$ in millions

2024

2023

2024

2023

Net premiums written

$

111.0

 

113.2

(2

)

%

$

327.1

 

307.5

6

 

%

Net premiums earned

 

107.5

 

95.2

13

 

 

 

317.8

 

264.2

20

 

 

Combined ratio

 

122.1

%

127.4

(5.3

)

pts

 

115.2

%

123.6

(8.4

)

pts

Loss and loss expense ratio

 

98.7

 

104.5

(5.8

)

 

 

91.8

 

98.7

(6.9

)

 

Underwriting expense ratio

 

23.4

 

22.9

0.5

 

 

 

23.4

 

24.9

(1.5

)

 

Net catastrophe losses

 

38.8

pts

25.6

13.2

 

 

 

24.8

pts

22.8

2.0

 

 

Non-catastrophe property losses and loss expenses

 

35.3

 

44.7

(9.4

)

 

 

39.4

 

43.2

(3.8

)

 

Unfavorable prior year reserve development on casualty lines

 

 

3.2

(3.2

)

 

 

 

3.4

(3.4

)

 

Excess and Surplus Lines Segment

For the third quarter, Excess and Surplus Lines premiums (representing 12% of total NPW) increased 28% compared to the prior-year period, driven by new business growth of 43% and average renewal pure price increases of 8.0%. The third quarter 2024 combined ratio was 83.2%, down 0.7 points compared to a year ago.

The following table shows the variances in key quarter-to-date and year-to-date measures:

Excess and Surplus Lines Segment

Quarter ended

September 30,

Change

Year-to-Date

September 30,

Change

$ in millions

2024

 

2023

2024

 

2023

 

Net premiums written

$

142.7

 

111.6

28

 

%

$

414.5

 

318.4

 

30

 

%

Net premiums earned

 

129.3

 

101.4

28

 

 

 

362.6

 

282.5

 

28

 

 

Combined ratio

 

83.2

%

83.9

(0.7

)

pts

 

88.4

%

89.7

 

(1.3

)

pts

Loss and loss expense ratio

 

52.5

 

51.9

0.6

 

 

 

57.5

 

57.4

 

0.1

 

 

Underwriting expense ratio

 

30.7

 

32.0

(1.3

)

 

 

30.9

 

32.3

 

(1.4

)

 

Net catastrophe losses

 

5.2

pts

3.5

1.7

 

 

 

7.1

pts

9.0

 

(1.9

)

 

Non-catastrophe property losses and loss expenses

 

10.0

 

7.4

2.6

 

 

 

11.8

 

8.7

 

3.1

 

 

(Favorable) prior year reserve development on casualty lines

 

 

 

 

 

 

(1.8

)

1.8

 

 

Investments Segment

For the third quarter, after-tax net investment income of $93 million was up 16% from a year ago. The after-tax income yield averaged 4.0% for the overall and fixed income securities portfolios. With this and invested assets per dollar of common stockholders' equity of $3.25 as of September 30, 2024, the Investments segment generated 13.1 points of non-GAAP operating ROE.

Investments Segment

Quarter ended

September 30,

Change

Year-to-Date

September 30,

Change

$ in millions, except per share data

2024

 

2023

2024

 

2023

Net investment income earned, after-tax

$

93.4

 

80.2

16

 

%

$

265.3

 

231.1

15

 

%

Net investment income per common share

 

1.52

 

1.31

16

 

 

 

4.33

 

3.79

14

 

 

Effective tax rate

 

20.7

%

20.5

0.2

 

pts

 

20.6

%

20.3

0.3

 

pts

Average yields:

 

 

 

 

 

 

 

 

 

 

Portfolio:

 

 

 

 

 

 

 

 

 

 

Pre-tax

 

5.0

 

4.9

0.1

 

 

 

4.9

 

4.8

0.1

 

 

After-tax

 

4.0

 

3.9

0.1

 

 

 

3.9

 

3.8

0.1

 

 

Fixed income securities:

 

 

 

 

 

 

 

 

 

 

Pre-tax

 

5.0

%

5.1

(0.1

)

pts

 

4.9

%

5.0

(0.1

)

pts

After-tax

 

4.0

 

4.1

(0.1

)

 

 

3.9

 

4.0

(0.1

)

 

Annualized ROE contribution

 

13.1

 

13.1

 

 

 

12.6

 

12.7

(0.1

)

 

Balance Sheet

$ in millions, except per share data

September 30, 2024

 

December 31, 2023

 

Change

Total assets

$

13,473.1

 

 

11,802.5

 

 

14

%

Total investments

 

9,635.3

 

 

8,693.7

 

 

11

 

 

Long-term debt

 

508.2

 

 

503.9

 

 

1

 

 

Stockholders’ equity

 

3,167.8

 

 

2,954.4

 

 

7

 

 

Common stockholders' equity

 

2,967.8

 

 

2,754.4

 

 

8

 

 

Invested assets per dollar of common stockholders’ equity

 

3.25

 

 

3.16

 

 

3

 

 

Net premiums written to policyholders' surplus

 

1.63

 

 

1.51

 

 

8

 

 

Book value per common share

 

48.82

 

 

45.42

 

 

7

 

 

Adjusted book value per common share1

 

50.80

 

 

50.03

 

 

2

 

 

Debt to total capitalization

 

13.8

%

 

14.6

%

 

(0.8

)

pts

Book value per common share increased by $3.40, or 7%, during the first nine months of 2024. The increase was primarily attributable to a $2.61 decrease in after-tax net unrealized losses on our fixed income securities portfolio and $1.71 of net income per diluted common share, partially offset by $1.05 in common stockholder dividends. The decrease in after-tax net unrealized losses on our fixed income securities portfolio was primarily related to lower interest rates. During the third quarter of 2024, the Company repurchased 103,000 shares of common stock at an average price of $84.34 for $8.7 million. Capacity under the existing repurchase authorization was $75.5 million as of September 30, 2024.

Selective's Board of Directors declared:

  • A 9% increase in the quarterly cash dividend on common stock to $0.38 per common share that is payable December 2, 2024, to holders of record on November 15, 2024; and
  • A quarterly cash dividend of $287.50 per share on our 4.60% Non-Cumulative Preferred Stock, Series B (equivalent to $0.28750 per depositary share) payable on December 16, 2024, to holders of record as of December 2, 2024.

Guidance

For 2024, we increased our expected GAAP combined ratio to 102.5%. The change reflects the third quarter's elevated catastrophe losses, partially offset by better-than-expected non-catastrophe property losses. Full-year expectations are as follows:

  • A GAAP combined ratio of 102.5%, up 1 point from our prior guidance of 101.5%. Our combined ratio estimate includes net catastrophe losses of 7.5 points, up from prior guidance of 5.5 points. Although too early to provide a specific estimate, we expect losses from Hurricane Milton, which made landfall on October 9, 2024, to be immaterial. Our combined ratio estimate assumes no additional prior year casualty reserve development;
  • After-tax net investment income of $360 million that includes $32 million from alternative investments;
  • An overall effective tax rate of approximately 21.0%, which assumes an effective tax rate of 20.5% for net investment income and 21% for all other items; and
  • Weighted average shares of 61.5 million on a fully diluted basis.

The supplemental investor package, with financial information not included in this press release, is available on the Investors page of Selective’s website at www.Selective.com.

Selective’s quarterly analyst conference call will be simulcast at 8:30 AM ET, on Tuesday, October 22, 2024, on www.Selective.com. The webcast will be available for rebroadcast until the close of business on November 21, 2024.

About Selective Insurance Group, Inc.
Selective Insurance Group, Inc. (Nasdaq: SIGI) is a holding company for 10 property and casualty insurance companies rated "A+" (Superior) by AM Best. Through independent agents, the insurance companies offer standard and specialty insurance for commercial and personal risks and flood insurance through the National Flood Insurance Program's Write Your Own Program. Selective's unique position as both a leading insurance group and an employer of choice is recognized in a wide variety of awards and honors, including listing in Forbes Best Midsize Employers in 2024 and certification as a Great Place to Work® in 2024 for the fifth consecutive year. For more information about Selective, visit www.Selective.com.

1Reconciliation of Net Income (Loss) Available to Common Stockholders to Non-GAAP Operating Income (Loss) and Certain Other Non-GAAP Measures
Non-GAAP operating income (loss), non-GAAP operating income (loss) per diluted common share, and non-GAAP operating return on common equity differ from net income (loss) available to common stockholders, net income (loss) available to common stockholders per diluted common share, and return on common equity, respectively, by the exclusion of after-tax net realized and unrealized gains and losses on investments included in net income (loss). Adjusted book value per common share differs from book value per common share by excluding total after-tax unrealized gains and losses on investments included in accumulated other comprehensive income (loss). These non-GAAP measures are used as important financial measures by management, analysts, and investors, because the timing of realized and unrealized investment gains and losses on securities in any given period is largely discretionary. In addition, net realized and unrealized gains and losses on investments could distort the analysis of trends. These operating measurements are not intended to be a substitute for net income (loss) available to common stockholders, net income (loss) available to common stockholders per diluted common share, return on common equity, and book value per common share prepared in accordance with U.S. generally accepted accounting principles (GAAP). Reconciliations of net income (loss) available to common stockholders, net income (loss) available to common stockholders per diluted common share, return on common equity, and book value per common share to non-GAAP operating income (loss), non-GAAP operating income (loss) per diluted common share, non-GAAP operating return on common equity, and adjusted book value per common share, respectively, are provided in the tables below.

Note: All amounts included in this release exclude intercompany transactions.

Reconciliation of Net Income (Loss) Available to Common Stockholders to Non-GAAP Operating Income (Loss)

$ in millions

Quarter ended September 30,

 

Year-to-Date September 30,

 

2024

 

 

2023

 

2024

 

2023

Net income (loss) available to common stockholders

$

90.0

 

 

86.9

 

 

104.6

 

 

233.5

 

Net realized and unrealized investment (gains) losses included in net income, before tax

 

(5.4

)

 

6.9

 

 

(5.1

)

 

9.0

 

Tax on reconciling items

 

1.1

 

 

(1.4

)

 

1.1

 

 

(1.9

)

Non-GAAP operating income (loss)

$

85.7

 

 

92.3

 

 

100.6

 

 

240.6

 

Reconciliation of Net Income (Loss) Available to Common Stockholders per Diluted Common Share to Non-GAAP Operating Income (Loss) per Diluted Common Share

 

Quarter ended September 30,

 

Year-to-Date September 30,

 

2024

 

 

2023

 

2024

 

2023

Net income (loss) available to common stockholders per diluted common share

$

1.47

 

 

1.42

 

 

1.71

 

 

3.83

 

Net realized and unrealized investment (gains) losses included in net income, before tax

 

(0.09

)

 

0.11

 

 

(0.08

)

 

0.15

 

Tax on reconciling items

 

0.02

 

 

(0.02

)

 

0.01

 

 

(0.03

)

Non-GAAP operating income (loss) per diluted common share

$

1.40

 

 

1.51

 

 

1.64

 

 

3.95

 

Reconciliation of Return on Common Equity to Non-GAAP Operating Return on Common Equity

 

Quarter ended September 30,

 

Year-to-Date September 30,

2024

 

2023

 

2024

 

2023

Return on Common Equity

12.6

 

%

 

14.1

 

 

5.0

 

 

12.8

 

Net realized and unrealized investment (gains) losses included in net income, before tax

(0.8

)

 

 

1.1

 

 

(0.2

)

 

0.5

 

Tax on reconciling items

0.3

 

 

 

(0.2

)

 

 

 

(0.1

)

Non-GAAP Operating Return on Common Equity

12.1

 

%

 

15.0

 

 

4.8

 

 

13.2

 

Reconciliation of Book Value per Common Share to Adjusted Book Value per Common Share

 

Quarter ended September 30,

 

Year-to-Date September 30,

 

2024

 

 

2023

 

2024

 

2023

Book value per common share

$

48.82

 

 

40.35

 

 

48.82

 

 

40.35

 

Total unrealized investment (gains) losses included in accumulated other comprehensive (loss) income, before tax

 

2.50

 

 

10.38

 

 

2.50

 

 

10.38

 

Tax on reconciling items

 

(0.52

)

 

(2.19

)

 

(0.52

)

 

(2.19

)

Adjusted book value per common share

$

50.80

 

 

48.54

 

 

50.80

 

 

48.54

 

Note: Amounts in the tables above may not foot due to rounding.

Forward-Looking Statements

Certain statements in this report, including information incorporated by reference, are “forward-looking statements” defined in the Private Securities Litigation Reform Act of 1995 ("PSLRA"). The PSLRA provides a forward-looking statement safe harbor under the Securities Act of 1933 and the Securities Exchange Act of 1934. These statements discuss our intentions, beliefs, projections, estimations, or forecasts of future events and financial performance. They involve known and unknown risks, uncertainties, and other factors that may cause our or our industry’s actual results, activity levels, or performance to materially differ from those in or implied by the forward-looking statements. In some cases, forward-looking statements include the words “may,” “will,” “could,” “would,” “should,” “expect,” “plan,” “anticipate,” “attribute,” “confident,” “strong,” “target,” “project,” “intend,” “believe,” “estimate,” “predict,” “potential,” “pro forma,” “seek,” “likely,” “continue,” or comparable terms. Our forward-looking statements are only predictions; we cannot guarantee or assure that such expectations will prove correct. We undertake no obligation to publicly update or revise any forward-looking statements for any reason, except as may be required by law.

Factors that could cause our actual results to differ materially from what we project, forecast, or estimate in forward-looking statements include, without limitation:

  • Challenging conditions in the economy, global capital markets, the banking sector, and commercial real estate, including prolonged higher inflation, could increase loss costs and negatively impact investment portfolios;
  • Deterioration in the public debt, public equity, or private investment markets that could lead to investment losses and interest rate fluctuations;
  • Ratings downgrades on individual securities we own could affect investment values and, therefore, statutory surplus;
  • The adequacy of our loss reserves and loss expense reserves;
  • Frequency and severity of catastrophic events, including natural events that may be impacted by climate change, such as hurricanes, severe convective storms, tornadoes, windstorms, earthquakes, hail, severe winter weather, floods, and fires, and man-made events such as criminal and terrorist acts, including cyber-attacks, explosions, and civil unrest;
  • Adverse market, governmental, regulatory, legal, political, or judicial conditions or actions, including social inflation;
  • The significant geographic concentration of our business in the eastern portion of the United States;
  • The cost, terms and conditions, and availability of reinsurance;
  • Our ability to collect on reinsurance and the solvency of our reinsurers;
  • The impact of changes in U.S. trade policies and imposition of tariffs on imports that may lead to higher than anticipated inflationary trends for our loss and loss expenses;
  • Related to COVID-19, we have successfully defended against payment of COVID-19-related business interruption losses based on our policies' terms, conditions, and exclusions. However, should the highest courts determine otherwise, our loss and loss expenses may increase, our related reserves may not be adequate, and our financial condition and liquidity may be materially impacted.
  • Ongoing wars and conflicts impacting global economic, banking, commodity, and financial markets, exacerbating ongoing economic challenges, including inflation and supply chain disruption, which influences insurance loss costs, premiums, and investment valuations;
  • Uncertainties related to insurance premium rate increases and business retention;
  • Changes in insurance regulations that impact our ability to write and/or cease writing insurance policies in one or more states;
  • The effects of data privacy or cyber security laws and regulations on our operations;
  • Major defect or failure in our internal controls or information technology and application systems that result in harm to our brand in the marketplace, increased senior executive focus on crisis and reputational management issues, and/or increased expenses, particularly if we experience a significant privacy breach;
  • Potential tax or federal financial regulatory reform provisions that could pose certain risks to our operations;
  • Our ability to maintain favorable financial ratings, which may include sustainability considerations, from rating agencies, including AM Best, Standard & Poor’s, Moody’s, and Fitch;
  • Our entry into new markets and businesses; and
  • Other risks and uncertainties we identify in filings with the United States Securities and Exchange Commission, including our Annual Report on Form 10-K and other periodic reports.

 

Investor Contact:

Brad B. Wilson

973-948-1283

Brad.Wilson@Selective.com

Media Contact:

Jamie M. Beal

973-948-1234

Jamie.Beal@Selective.com

Source: Selective Insurance Group, Inc.

FAQ

What was Selective Insurance Group's (SIGI) net income per diluted share in Q3 2024?

Selective Insurance Group (SIGI) reported net income of $1.47 per diluted common share for the third quarter of 2024.

How much did Selective's (SIGI) net premiums written increase in Q3 2024?

Selective's (SIGI) net premiums written increased by 9% compared to the third quarter of 2023.

What was Selective Insurance Group's (SIGI) GAAP combined ratio in Q3 2024?

Selective Insurance Group's (SIGI) GAAP combined ratio was 99.5% in the third quarter of 2024.

How did catastrophe losses impact Selective's (SIGI) combined ratio in Q3 2024?

Net catastrophe losses increased Selective's (SIGI) GAAP combined ratio by 13.4 points in the third quarter of 2024.

What was the average renewal pure price increase for Selective's (SIGI) Commercial Lines in Q3 2024?

Selective's (SIGI) Commercial Lines renewal pure price increases averaged 9.1% in the third quarter of 2024.

Selective Insurance Group

NASDAQ:SIGI

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5.90B
60.04M
1.22%
85.67%
2.04%
Insurance - Property & Casualty
Fire, Marine & Casualty Insurance
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United States of America
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