28th April 2025 - Author: Kassandra Jimenez-Sanchez -
Selective Insurance Group has reported its financial results for the first quarter of 2025, reporting net income of $107.6 million, $1.24 billion in net written premiums (NWP) and an improved combined ratio of 96.1%.
The company achieved a 7% year-over-year increase in NWP, mainly driven by renewal pure price increases of 10.3%. At the same time, net premiums earned rose 10% year-over-year to $1.2 billion.
Selective’s underwriting profitability also saw improvement in the quarter, with its combined ratio decreasing 2.1 points to 96.1%. Underwriting income increased by 140% to $36.1 million in Q1 2025, compared with $15 million in Q1 2024.
The combined ratio includes 3.7 points of catastrophe losses and 0.4 points of net unfavourable prior year casualty reserve development, compared with 5.3 points of cat losses and 3.3 points unfavourable prior year casualty reserve development in Q1 2024.
Net investment income increased 12% from a year ago, to $96 million after-tax, and generated 12.8 points of annualised return on equity (ROE) in the quarter.
John J. Marchioni, Chairman, President and Chief Executive Officer, said: “Our operating ROE of 14.4% for the first quarter was a positive start to the year and our full-year combined ratio guidance remains at 96% to 97%. Total renewal pure price increased 10.3% in the quarter, up from 8.1% a year ago.
“Our underwriting portfolio remains stable, and our most profitable segments drove growth. Excess and surplus lines net premiums written grew by 20% in the quarter, with a 92.5% combined ratio. Standard Commercial Lines, representing 81% of net premiums written, grew 8% in the quarter with a 96.4% combined ratio. In Standard Commercial Lines, quarterly renewal pure pricing was 9.1% with stable retention of 85%. General Liability pricing accelerated further to 12.0%, up from 10.6% in the fourth quarter of 2024 and 6.5% a year ago.”
He concluded: “In February, we completed a $400 million senior note issuance, enhancing our financial flexibility. The proceeds are being used for general corporate purposes, including supporting organic growth, which remains our primary way to create long-term value for our shareholders.”
For this year’s first quarter, Standard Commercial Lines premiums – which represent 81% of total NPW – increased 8% compared to 2024. This growth reflects an average renewal pure price increases of 9.1% and stable retention of 85%.
The combined ratio for this segment improved 2.4 points year-over-year, to 96.4%, driven by no prior year casualty reserve development compared to 4.2 points of unfavourable prior year casualty reserve development a year ago and lower net catastrophe losses; and partially offset by higher current year casualty loss costs.
The insurer’s Standard Personal Lines premiums – which represent 7% of total NPW – decreased 12% in Q1 2025 compared to the same period last year, a figure that resulted from deliberate profit improvement actions.
Selective’s focus on growth in states with approved adequate rates led to a 58% decrease in new business. Renewal pure price increased by 24.1%, and retention was 75%.
The combined ratio for the segment improved by 7.1 points from last year, to 98.0%, due to renewal pure price increases and lower catastrophe and non-catastrophe property losses, partially offset by 4.8 points of unfavourable prior year casualty reserve development in personal auto.
Excess and Surplus Lines premiums (representing 12% of total NPW) also saw an improvement in the quarter, increasing 20% compared to the prior-year period, driven by strong policy count growth, average renewal pure price increases of 8.7%, and new business growth of 4%.
The combined ratio for this segment was 92.5% in Q1 2025, up 4.9 points compared to a year ago as higher catastrophe losses were partially offset by lower non-catastrophe property losses.
