Group 1 - Safety Insurance Group (NASDAQ: SAFT) is the third largest provider of homeowners insurance in Massachusetts, holding a 6.3% market share [1] - The company generates approximately 95% of its premiums from Massachusetts, indicating a strong regional focus [1] Group 2 - The investment group European Small Cap Ideas offers exclusive access to actionable research on appealing Europe-focused investment opportunities [1] - The focus of the investment group is on high-quality ideas in the small-cap space, emphasizing capital gains and dividend income for continuous cash flow [1] - Features of the investment group include two model portfolios, weekly updates, educational content, and an active chat room for discussions [1]

Part I. Financial Information This part details the Company's financial performance, condition, and related disclosures for the reporting period [Item 1. Consolidated Financial Statements](index=3&type=section&id=Item%201.%20Consolidated%20Financial%20Statements) This section presents the unaudited consolidated financial statements of Safety Insurance Group, Inc. and its subsidiaries for the periods ended June 30, 2025, and December 31, 2024, along with detailed notes explaining accounting policies, financial performance, and specific financial items [Consolidated Balance Sheets](index=3&type=section&id=Consolidated%20Balance%20Sheets) This section presents the Company's financial position, including assets, liabilities, and equity at specific dates Consolidated Balance Sheet Highlights (Dollars in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :--------------------------------------- | :------------ | :---------------- | | Total Assets | $2,364,208 | $2,270,090 | | Total Liabilities | $1,490,944 | $1,441,626 | | Total Shareholders' Equity | $873,264 | $828,464 | | Losses and loss adjustment expense reserves | $685,941 | $671,669 | | Unearned premium reserves | $659,464 | $619,916 | | Fixed maturities, available for sale, at fair value | $1,188,337 | $1,115,218 | | Equity securities, at fair value | $235,352 | $221,422 | [Consolidated Statements of Operations](index=4&type=section&id=Consolidated%20Statements%20of%20Operations) This section details the Company's revenues, expenses, and net income over specific periods Consolidated Statements of Operations Highlights (Dollars in thousands, except per share data) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net earned premiums | $282,113 | $246,944 | $554,803 | $482,997 | | Total revenue | $316,344 | $269,783 | $617,773 | $538,016 | | Net income | $28,937 | $16,636 | $50,833 | $36,714 | | Basic EPS | $1.95 | $1.13 | $3.44 | $2.49 | | Diluted EPS | $1.95 | $1.13 | $3.43 | $2.48 | | Cash dividends paid per common share | $0.90 | $0.90 | $1.80 | $1.80 | - Net earned premiums **increased by** **14.2%** for the three months ended June 30, 2025, and by **14.9%** for the six months ended June 30, 2025, compared to the prior year periods[10](index=10&type=chunk) - Net income **increased by** **73.9%** for the three months ended June 30, 2025, and by **38.4%** for the six months ended June 30, 2025, compared to the prior year periods[10](index=10&type=chunk) [Consolidated Statements of Comprehensive Income (Loss)](index=5&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income%20(Loss)) This section reports net income and other comprehensive income (loss) components for the periods presented Consolidated Statements of Comprehensive Income (Loss) Highlights (Dollars in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net income | $28,937 | $16,636 | $50,833 | $36,714 | | Other comprehensive income (loss), net of tax | $5,917 | ($1,217) | $18,193 | ($6,652) | | Comprehensive income | $34,854 | $15,419 | $69,026 | $30,062 | - Comprehensive income **increased by** **126.0%** for the three months ended June 30, 2025, and by **129.6%** for the six months ended June 30, 2025, **primarily due to** positive unrealized holding gains on investments[13](index=13&type=chunk) [Consolidated Statements of Changes in Shareholders' Equity](index=6&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Shareholders'%20Equity) This section outlines changes in shareholders' equity, including net income, dividends, and other comprehensive income Shareholders' Equity Changes (Dollars in thousands) | Metric | Balance at Dec 31, 2024 | Net Income (Jan 1 - Jun 30, 2025) | Unrealized Gains on Securities (Jan 1 - Jun 30, 2025) | Dividends Paid (Jan 1 - Jun 30, 2025) | Balance at Jun 30, 2025 | | :--------------------------------------- | :---------------------- | :-------------------------------- | :---------------------------------------------------- | :------------------------------------ | :---------------------- | | Total Shareholders' Equity | $828,464 | $50,833 | $18,193 | ($26,754) | $873,264 | - **Total shareholders' equity increased from** **$828,464 thousand** at December 31, 2024, to **$873,264 thousand** at June 30, 2025, driven by net income and unrealized gains on available-for-sale securities, partially offset by dividends[15](index=15&type=chunk) [Consolidated Statements of Cash Flows](index=7&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) This section summarizes cash inflows and outflows from operating, investing, and financing activities Consolidated Statements of Cash Flows Highlights (Six Months Ended June 30, Dollars in thousands) | Metric | 2025 | 2024 | | :--------------------------------------- | :----- | :----- | | Net cash provided by operating activities | $35,496 | $4,454 | | Net cash (used for) provided by investing activities | ($18,217) | $28,821 | | Net cash used for financing activities | ($26,844) | ($26,848) | | Net increase (decrease) in cash and cash equivalents | ($9,565) | $6,427 | | Cash and cash equivalents at end of period | $49,409 | $44,579 | - Net cash **provided by operating activities significantly increased to** **$35,496 thousand** in H1 2025 from **$4,454 thousand** in H1 2024[17](index=17&type=chunk) - Investing activities **shifted from** **providing** **$28,821 thousand** in cash in H1 2024 to **using** **$18,217 thousand** in H1 2025[17](index=17&type=chunk) [Notes to Unaudited Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Unaudited%20Consolidated%20Financial%20Statements) This section provides detailed explanations and disclosures supporting the consolidated financial statements [Note 1. Basis of Presentation](index=8&type=section&id=Note%201.%20Basis%20of%20Presentation) This note describes the Company's business, accounting principles, and the basis for financial statement preparation - The Company is a **leading provider** of property and casualty insurance, **primarily focused on** the Massachusetts market, with automobile insurance as its principal product line[24](index=24&type=chunk) - The Massachusetts Property Insurance Underwriting Association (FAIR Plan) **restructured on** April 1, 2024, transitioning from a profit/loss sharing partnership to a stand-alone entity[25](index=25&type=chunk) [Note 2. Recent Accounting Pronouncements](index=8&type=section&id=Note%202.%20Recent%20Accounting%20Pronouncements) This note discusses the impact of newly adopted and upcoming accounting standards on the Company's financials - ASU 2023-07 (Segment Reporting) became effective for interim periods starting January 1, 2025, with **no material impact** on the Company's financial position, results of operations, or cash flows[26](index=26&type=chunk)[27](index=27&type=chunk) - The Company operates with **one reportable operating segment**: property and casualty insurance operations[28](index=28&type=chunk) - ASU 2023-09 (Income Taxes) and ASU 2024-03 (Income Statement Expense Disaggregation) are effective for fiscal years starting January 1, 2025, and January 1, 2027, respectively, and are **not expected to impact** financial position, results, or cash flows, though disclosure impacts are being evaluated[30](index=30&type=chunk)[31](index=31&type=chunk) [Note 3. Earnings per Weighted Average Common Share](index=9&type=section&id=Note%203.%20Earnings%20per%20Weighted%20Average%20Common%20Share) This note provides details on the calculation of basic and diluted earnings per share Earnings per Weighted Average Common Share (EPS) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Basic EPS | $1.95 | $1.13 | $3.44 | $2.49 | | Diluted EPS | $1.95 | $1.13 | $3.43 | $2.48 | | Cash dividends paid per common share | $0.90 | $0.90 | $1.80 | $1.80 | [Note 4. Share-Based Compensation](index=10&type=section&id=Note%204.%20Share-Based%20Compensation) This note outlines the Company's share-based incentive plans and related compensation expenses - The Amended 2018 Long-Term Incentive Plan has a **pool of** **700,000 shares** of common stock available for issuance, with **236,326 shares remaining available** for future grants as of June 30, 2025[36](index=36&type=chunk)[38](index=38&type=chunk) - Unrecognized compensation expense for non-vested restricted stock awards **totaled** **$7,786 thousand** as of June 30, 2025, expected to be recognized over a **weighted average period of** **1.7 years**[46](index=46&type=chunk) Restricted Stock Activity (Six Months Ended June 30, 2025) | Metric | Shares Under Restriction | Weighted Average Fair Value | | :--------------------------------------- | :----------------------- | :-------------------------- | | Outstanding at beginning of year | 63,522 | $83.60 | | Granted | 41,178 | $79.67 | | Vested and unrestricted | (35,188) | $84.77 | | Forfeited | (291) | $82.53 | | Outstanding at end of period | 69,221 | $82.85 | [Note 5. Investments](index=12&type=section&id=Note%205.%20Investments) This note details the composition, fair value, and performance of the Company's investment portfolio Investment Portfolio Summary (Dollars in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :--------------------------------------- | :------------ | :---------------- | | Total investments | $1,580,108 | $1,513,059 | | Gross Unrealized Gains | $44,266 | $33,002 | | Gross Unrealized Losses | ($58,766) | ($77,455) | | Net Investment Income (3 months) | $15,724 | $13,500 | | Net Investment Income (6 months) | $30,298 | $28,731 | - The Company's investment portfolio included **795 securities** in an unrealized loss position at June 30, 2025[49](index=49&type=chunk) - The **Allowance for Expected Credit Losses was** **$1,453 thousand** at June 30, 2025, up from **$1,198 thousand** at December 31, 2024[48](index=48&type=chunk)[65](index=65&type=chunk) - The Company held **one Level 3 security** at June 30, 2025, and December 31, 2024, with no transfers between Level 1 and Level 2 during the periods[79](index=79&type=chunk)[80](index=80&type=chunk) [Note 6. Allowance for Expected Credit Losses](index=18&type=section&id=Note%206.%20Allowance%20for%20Expected%20Credit%20Losses) This note explains the Company's allowance for credit losses on financial assets, including accounts receivable Allowance for Expected Credit Losses on Accounts Receivable (Dollars in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :--------------------------------------- | :------------ | :---------------- | | Allowance for Expected Credit Losses | $827 | $918 | - **No expected credit losses were identified** for reinsurance recoverables at June 30, 2025, or December 31, 2024, due to strong reinsurer ratings and collateralization[87](index=87&type=chunk) - The **majority of the Company's reinsurance recoverable** (**96%** at June 30, 2025) is from the CAR Commercial Automobile Program[87](index=87&type=chunk) [Note 7. Loss and Loss Adjustment Expense Reserves](index=20&type=section&id=Note%207.%20Loss%20and%20Loss%20Adjustment%20Expense%20Reserves) This note provides information on the Company's reserves for unpaid losses and related adjustment expenses Loss and Loss Adjustment Expense Reserves (Dollars in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :--------------------------------------- | :------------ | :---------------- | | Reserves for losses and LAE at end of period | $685,941 | $671,669 | - Prior year reserves **decreased by** **$23,473 thousand** for the six months ended June 30, 2025, **primarily due to** re-estimations in retained automobile and homeowners lines[90](index=90&type=chunk) [Note 8. Commitments and Contingencies](index=20&type=section&id=Note%208.%20Commitments%20and%20Contingencies) This note discloses the Company's contractual commitments and potential liabilities from legal matters - The Company has **committed** **$170,000 thousand** to limited partnerships, with **$32,163 thousand remaining callable** as of June 30, 2025[92](index=92&type=chunk) - Management believes that the ultimate resolution of pending claims and future assessments from the Massachusetts Insurers Insolvency Fund will **not have a material adverse effect** on the consolidated financial statements[93](index=93&type=chunk)[94](index=94&type=chunk) [Note 9. Debt](index=21&type=section&id=Note%209.%20Debt) This note describes the Company's debt instruments, credit facilities, and associated interest expenses - The Company **extended its Revolving Credit Agreement** with Citizens Bank, N.A. to August 10, 2028, **providing** a **$30,000 thousand** revolving credit facility[96](index=96&type=chunk) - The Company **borrowed** **$30,000 thousand** under the Citizens Bank Credit Agreement on March 27, 2025, with this amount **outstanding at** June 30, 2025[98](index=98&type=chunk) Interest Expense (Dollars in thousands) | Source | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--------------------------------------- | :------------------------------- | :------------------------------- | | Citizens Bank Credit Agreement | $443 | $15 | | FHLB-Boston borrowing | $0 | $125 | [Note 10. Income Taxes](index=22&type=section&id=Note%2010.%20Income%20Taxes) This note presents information on the Company's income tax expense, effective tax rate, and deferred taxes Effective Tax Rate | Period | 2025 | 2024 | | :--------------------------------------- | :--- | :--- | | Three Months Ended June 30 | 21.4% | 21.7% | | Six Months Ended June 30 | 21.9% | 21.6% | - The 'One Big Beautiful Bill Act,' signed on July 4, 2025, is **not currently expected to have a material impact** on the Company's financial position or results of operations[107](index=107&type=chunk) [Note 11. Share Repurchase Program](index=22&type=section&id=Note%2011.%20Share%20Repurchase%20Program) This note details the Company's share repurchase authorizations and activity during the period - The Board of Directors has **cumulatively authorized increases** to the share repurchase program up to **$200,000 thousand** of outstanding common shares[109](index=109&type=chunk) - **No share purchases were made** under the program during the three and six months ended June 30, 2025[110](index=110&type=chunk) - As of June 30, 2025, the Company had **purchased** **3,215,690 shares** at a cost of **$155,240 thousand** under the program[110](index=110&type=chunk) [Note 12. Leases](index=22&type=section&id=Note%2012.%20Leases) This note provides information on the Company's operating and finance leases, including lease costs and terms Operating Lease Costs (Dollars in thousands) | Period | 2025 | 2024 | | :--------------------------------------- | :--- | :--- | | Three Months Ended June 30 | $904 | $1,006 | | Six Months Ended June 30 | $1,809 | $2,019 | - The **weighted average remaining lease term** for operating leases was **3.45 years**, with a **weighted average discount rate of** **2.46%** as of June 30, 2025[113](index=113&type=chunk) [Note 13. Subsequent Events](index=23&type=section&id=Note%2013.%20Subsequent%20Events) This note discloses significant events occurring after the balance sheet date but before financial statement issuance - **No subsequent events requiring recognition or disclosure** have occurred, other than the 'One Big Beautiful Bill Act' mentioned in Note 10[114](index=114&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=24&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the Company's financial condition and results of operations, analyzing key performance indicators, recent trends... [Executive Summary and Overview](index=24&type=section&id=Executive%20Summary%20and%20Overview) This section provides a high-level summary of the Company's business, market position, and financial highlights - Safety Insurance Group, Inc. is a **leading provider** of private passenger automobile, commercial automobile, homeowners, and commercial other-than-auto insurance, primarily in Massachusetts[121](index=121&type=chunk) - The Company holds **significant market shares** in Massachusetts: third largest private passenger automobile carrier (**9.7%**), second largest commercial automobile carrier (**12.9%**), and third largest homeowners insurance carrier (**6.3%**) in 2024[121](index=121&type=chunk) - A.M. Best **reaffirmed Safety Insurance's 'A (Excellent)' rating** on June 20, 2025[122](index=122&type=chunk) Direct Written Premiums by State (Dollars in thousands) | State | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Massachusetts | $326,925 | $299,411 | $610,204 | $553,762 | | New Hampshire | $14,731 | $13,325 | $27,154 | $24,084 | | Maine | $4,173 | $2,775 | $7,441 | $5,004 | | Total | $345,829 | $315,511 | $644,799 | $582,850 | [Recent Trends and Events](index=25&type=section&id=Recent%20Trends%20and%20Events) This section discusses key operational and market trends, as well as significant events impacting the Company - **Direct written premium growth was** **9.6%** for the three months ended June 30, 2025, and **10.6%** for the six months ended June 30, 2025, driven by new business production and rate increases[126](index=126&type=chunk)[151](index=151&type=chunk) - **Losses and loss adjustment expenses incurred increased by** **12.4%** for the three months and **12.7%** for the six months ended June 30, 2025, **primarily due to** increased loss severity[127](index=127&type=chunk)[151](index=151&type=chunk) - The **losses and loss adjustment expenses ratio decreased to** **68.8%** (Q2 2025) from **70.0%** (Q2 2024) and to **69.3%** (H1 2025) from **70.6%** (H1 2024), due to earned premium **growth** offsetting increased loss severity[127](index=127&type=chunk) Approved Rate Changes in 2025 and 2024 | Line of Business | Effective Date | Rate Change | | :--------------------------------------- | :------------- | :---------- | | Massachusetts Homeowners | August 1, 2025 | 4.2% | | Massachusetts Private Passenger Automobile | July 1, 2025 | 5.1% | | Massachusetts Commercial Automobile | May 1, 2025 | 5.2% | | Massachusetts Private Passenger Automobile | January 1, 2025 | 5.3% | [Insurance Ratios](index=26&type=section&id=Insurance%20Ratios) This section analyzes key insurance profitability and efficiency ratios, such as loss, expense, and combined ratios GAAP Insurance Ratios | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Loss ratio | 68.8% | 70.0% | 69.3% | 70.6% | | Expense ratio | 29.3% | 29.9% | 29.5% | 30.3% | | Combined ratio | 98.1% | 99.9% | 98.8% | 100.9% | - The **combined ratio improved to** **98.1%** for the three months ended June 30, 2025, and to **98.8%** for the six months ended June 30, 2025, indicating enhanced underwriting profitability[133](index=133&type=chunk) [Share-Based Compensation](index=26&type=section&id=Share-Based%20Compensation) This note outlines the Company's share-based incentive plans and related compensation expenses - The Amended 2018 Long-Term Incentive Plan has a **pool of** **700,000 shares** of common stock available for issuance, with **236,326 shares available for future grants** as of June 30, 2025[135](index=135&type=chunk)[136](index=136&type=chunk) - **Awards granted in H1 2025 included** **35,178 service-based restricted shares** (3-year vesting), **29,105 performance-based restricted shares** (3-year cliff vesting), and **6,000 restricted shares** for directors (no vesting period)[137](index=137&type=chunk) [Reinsurance](index=27&type=section&id=Reinsurance) This section describes the Company's reinsurance arrangements and their impact on risk management - The Company **maintains three layers of excess catastrophe reinsurance**, **providing** **$675,000 thousand** of coverage for property losses exceeding **$75,000 thousand** up to **$750,000 thousand** for 2025[142](index=142&type=chunk) - Casualty excess of loss reinsurance covers losses exceeding **$2,000 thousand** up to **$10,000 thousand**, and property excess of loss reinsurance covers losses exceeding **$3,000 thousand** up to **$25,000 thousand**[143](index=143&type=chunk) - As of June 30, 2025, **$171,516 thousand was recoverable from** Commonwealth Automobile Reinsurers (CAR)[144](index=144&type=chunk) - The Massachusetts Property Insurance Underwriting Association (FAIR Plan) **restructured on** April 1, 2024, transforming into a stand-alone, risk-bearing entity[145](index=145&type=chunk) [Non-GAAP Measures](index=27&type=section&id=Non-GAAP%20Measures) This section defines and reconciles non-GAAP financial measures used by management to assess performance - **Non-GAAP operating income is defined as** GAAP net income adjusted for net realized gains/losses on investments, changes in net unrealized gains on equity securities, credit loss benefit/expense, and related taxes[147](index=147&type=chunk) Non-GAAP Operating Income (Dollars in thousands, except per share data) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Non-GAAP Operating income | $21,518 | $17,272 | $40,514 | $31,018 | | Non-GAAP Operating income per diluted share | $1.45 | $1.18 | $2.74 | $2.09 | [Results of Operations](index=28&type=section&id=Results%20of%20Operations) This section provides a detailed analysis of the Company's revenues, expenses, and net income for the periods Key Financial Results (Dollars in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Direct written premiums | $345,829 | $315,511 | $644,799 | $582,850 | | Net written premiums | $319,475 | $294,935 | $594,255 | $545,230 | | Net earned premiums | $282,113 | $246,944 | $554,803 | $482,997 | | Net investment income | $15,724 | $13,500 | $30,298 | $28,731 | | Net realized gains on investments | $2,131 | $2,715 | $6,394 | $3,207 | | Losses and loss adjustment expenses | $194,232 | $172,742 | $384,522 | $341,141 | | Underwriting, operating and related expenses | $82,796 | $73,921 | $163,647 | $146,188 | | Net income | $28,937 | $16,636 | $50,833 | $36,714 | - **Net effective annualized yield on the investment portfolio increased to** **4.2%** for Q2 2025 from **3.9%** for Q2 2024, driven by higher earned interest from bond purchases[155](index=155&type=chunk) - **Total prior year favorable development decreased to** **$23,473 thousand** for H1 2025 from **$30,375 thousand** for H1 2024, **primarily due to** the inclusion of FAIR Plan development in the prior year[171](index=171&type=chunk) - Interest expense **significantly increased to** **$442 thousand** for Q2 2025 from **$138 thousand** for Q2 2024, mainly due to a new loan agreement with Citizens Bank[173](index=173&type=chunk) [Liquidity and Capital Resources](index=32&type=section&id=Liquidity%20and%20Capital%20Resources) This section discusses the Company's cash flows, financial flexibility, and capital management strategies Cash Flow Summary (Six Months Ended June 30, Dollars in thousands) | Metric | 2025 | 2024 | | :--------------------------------------- | :----- | :----- | | Net cash provided by operating activities | $35,496 | $4,454 | | Net cash used for investing activities | ($18,217) | $28,821 | | Net cash used for financing activities | ($26,844) | ($26,848) | - Safety Insurance **paid dividends of** **$25,750 thousand** to Safety during the six months ended June 30, 2025[187](index=187&type=chunk) - The Board **approved an increase in the quarterly cash dividend from** **$0.90** to **$0.92** per share, payable on September 15, 2025[189](index=189&type=chunk) - The Insurance Subsidiaries' **total capital was** **$758,789 thousand** at December 31, 2024, **exceeding minimum risk-based capital requirements**[192](index=192&type=chunk) [Off-Balance Sheet Arrangements](index=35&type=section&id=Of%20-Balance%20Sheet%20Arrangements) This section discloses any material off-balance sheet obligations or arrangements of the Company - The Company has **no material obligations** under guarantee contracts, retained or contingent interests in unconsolidated entities, derivative instruments, or variable interests in unconsolidated entities[194](index=194&type=chunk) [Critical Accounting Policies and Estimates](index=35&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) This section highlights accounting policies requiring significant judgment and the impact of estimates - The **selected point estimate for net loss and LAE reserves was** **$550,315 thousand** as of June 30, 2025, **within a reasonably possible range of** **$510,482 thousand** to **$579,378 thousand**[204](index=204&type=chunk) - A **1 percentage-point change in the loss and LAE ratio would result in a** **$5,549 thousand change in reserves and a** **$4,384 thousand effect on net income** (**$0.30** per diluted share) for the six months ended June 30, 2025[217](index=217&type=chunk) - **Prior year reserves decreased by** **$23,473 thousand** during the six months ended June 30, 2025, **primarily due to reductions in** private passenger automobile, commercial automobile, homeowners, and other lines reserves[226](index=226&type=chunk) Net Loss and LAE Reserves by Line of Business (June 30, 2025, Dollars in thousands) | Line of Business | Low Estimate | Recorded Estimate | High Estimate | | :--------------------------------------- | :----------- | :---------------- | :------------ | | Private passenger automobile | $253,835 | $270,205 | $279,924 | | Commercial automobile | $102,659 | $115,251 | $127,123 | | Homeowners | $96,281 | $100,905 | $103,516 | | All other | $57,707 | $63,954 | $68,815 | | Total | $510,482 | $550,315 | $579,378 | [Forward-Looking Statements](index=41&type=section&id=Forward-Looking%20Statements) This section cautions readers about inherent risks and uncertainties that may affect future results - Forward-looking statements are **subject to risks and uncertainties**, including competition, regulatory changes, severe weather, inflation, and economic conditions, which could cause actual results to differ materially from projections[234](index=234&type=chunk)[243](index=243&type=chunk) [Item 3. Quantitative and Qualitative Information about Market Risk](index=42&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Information%20about%20Market%20Risk) This section details the Company's exposure to market risk, primarily from interest rate fluctuations affecting its fixed-rate investments and floating-rate debt, and equity risk from its holdings. It includes a sensitivity analysis for interest rate changes - The Company's **primary market risk exposure is to changes in interest rates**, **affecting its significant holdings** of fixed-rate investments and financing activities[237](index=237&type=chunk)[238](index=238&type=chunk) Interest Rate Sensitivity Analysis (As of June 30, 2025, Dollars in thousands) | Interest Rate Change | Estimated Fair Value | Estimated Increase (Decrease) in Fair Value | | :--------------------------------------- | :------------------- | :------------------------------------------ | | -100 Basis Point Change | $1,237,363 | $49,026 | | No Change | $1,188,337 | $0 | | +100 Basis Point Change | $1,140,494 | ($47,843) | - A **2.0%** increase in the prevailing interest rate on the Company's **$30,000 thousand** variable rate debt would **increase interest expense by approximately** **$600 thousand** for 2025[244](index=244&type=chunk) - **Equity risk is managed through** industry and issuer diversification and asset allocation techniques[246](index=246&type=chunk) [Item 4. Controls and Procedures](index=43&type=section&id=Item%204.%20Controls%20and%20Procedures) The Company's CEO and CFO concluded that disclosure controls and procedures were effective as of June 30, 2025, and reported no material changes in internal control over financial reporting during the last fiscal quarter - The CEO and CFO concluded that the Company's **disclosure controls and procedures were adequate and effective** as of June 30, 2025[247](index=247&type=chunk) - There have been **no material changes in internal control over financial reporting** during the last fiscal quarter[248](index=248&type=chunk) Part II. Other Information This part covers legal proceedings, risk factors, equity sales, defaults, and other required disclosures [Item 1. Legal Proceedings](index=44&type=section&id=Item%201.%20Legal%20Proceedings) This section refers to Note 8, Commitments and Contingencies, for details on legal proceedings, which management believes will not have a material adverse effect on the Company's consolidated financial statements - **Refer to Item 1—Financial Statements, Note 8, Commitments and Contingencies, for information on legal proceedings**[250](index=250&type=chunk) [Item 1A. Risk Factors](index=44&type=section&id=Item%201A.%20Risk%20Factors) The Company states that there have been no material changes to the risk factors previously disclosed in its 2024 Annual Report on Form 10-K - **No subsequent material changes from the risk factors previously disclosed** in the Company's 2024 Annual Report on Form 10-K[250](index=250&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=44&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section reiterates the Board-approved share repurchase program, cumulatively authorized up to $200,000 thousand, and confirms that no shares were repurchased during the three and six months ended June 30, 2025 - The Board of Directors has **cumulatively authorized increases** to the existing share repurchase program of up to **$200,000 thousand**[251](index=251&type=chunk) - **No shares were repurchased** under the program during the three and six months ended June 30, 2025[251](index=251&type=chunk) - As of June 30, 2025, **703,971 shares may yet be purchased** under the plans or programs[252](index=252&type=chunk) [Item 3. Defaults upon Senior Securities](index=44&type=section&id=Item%203.%20Defaults%20upon%20Senior%20Securities) The Company reported no defaults upon senior securities during the period - None[253](index=253&type=chunk) [Item 4. Mine Safety Disclosures](index=44&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) The Company reported no mine safety disclosures - None[253](index=253&type=chunk) [Item 5. Other Information](index=44&type=section&id=Item%205.%20Other%20Information) The Company reported that no officers or directors adopted, terminated, or modified any Rule 10b5-1 trading arrangements during the three months ended June 30, 2025 - **No officers or directors adopted, terminated, or modified any Rule 10b5-1 trading arrangements** during the three months ended June 30, 2025[254](index=254&type=chunk) [Item 6. Exhibits](index=44&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed as part of the Form 10-Q, including CEO and CFO certifications, XBRL documents, and the cover page - **Exhibits include CEO and CFO certifications** (**31.1**, **31.2**, **32.1**, **32.2**) and Inline XBRL documents (**101.INS**, **101.SCH**, **101.CAL**, **101.DEF**, **101.LAB**, **101.PRE**, **104**)[257](index=257&type=chunk)

Exhibit 99.1 SAFETY INSURANCE GROUP, INC. ANNOUNCES SECOND QUARTER 2025 RESULTS AND RAISES THIRD QUARTER 2025 DIVIDEND Boston, Massachusetts, August 6, 2025. Safety Insurance Group, Inc. (NASDAQ:SAFT) ("Safety" or the "Company") today reported second quarter 2025 results. George M. Murphy, Chairman of the Board of Directors, President and Chief Executive Officer, commented: "For the quarter ended June 30, 2025, our combined ratio improved to 98.1% compared to 99.9% in the same period in the prior year. The ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ______to ______ Commission File Number: 000-50070 SAFETY INSURANCE GROUP, INC. (Exact name of registrant as specified in its charter) Delaware 13-41816 ...

Exhibit 99.1 SAFETY INSURANCE GROUP, INC. ANNOUNCES FIRST QUARTER 2025 RESULTS AND DECLARES SECOND QUARTER 2025 DIVIDEND Boston, Massachusetts, May 7, 2025. Safety Insurance Group, Inc. (NASDAQ:SAFT) ("the Company" or "Safety") today reported first quarter 2025 results. George M. Murphy, Chairman of the Board of Directors, President and Chief Executive Officer, commented: "Safety's first quarter combined ratio in 2025 improved to 99.4% compared to 101.9% in the first quarter of 2024. The year-over-year chan ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2024 Or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 000-50070 SAFETY INSURANCE GROUP, INC. (Exact name of registrant as specified in its charter) Delaware 13-4181699 (State or other ...

Boston, Massachusetts, February 25, 2025. Safety Insurance Group, Inc. (NASDAQ:SAFT) ("Safety" or the "Company") today reported fourth quarter and year ended 2024 results. George M. Murphy, Chairman of the Board of Directors, President and Chief Executive Officer, commented: "For the year ended December 31, 2024, Safety Insurance continued to achieve significant direct written premium growth, which increased 20.4% over the prior year, driving our top-line revenue above $1 billion dollars for the first time ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2024 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ______to ______ Commission File Number: 000-50070 SAFETY INSURANCE GROUP, INC. (Exact name of registrant as specified in its charter) Delaware 13-41816 ...

Insurance Operations - The company operates as the third largest private passenger auto premium insurance carrier, the second largest commercial auto insurance carrier, and the third largest homeowner insurance carrier in Massachusetts[20]. - Direct written premiums for private passenger automobile insurance increased to $543,167, representing 54.7% of total premiums in 2023, up from $427,665 (52.0%) in 2022[26]. - The company achieved a total of $991,224 in direct written premiums for all product lines in 2023, compared to $823,318 in 2022, reflecting a significant growth[26]. - The commercial automobile insurance segment accounted for $157,101 in direct written premiums, or 15.9% of total premiums in 2023, up from $143,571 (17.4%) in 2022[26]. - Homeowners insurance premiums reached $242,346, making up 24.5% of total premiums in 2023, compared to $208,577 (25.3%) in 2022[26]. - The company plans to further penetrate the Massachusetts, New Hampshire, and Maine markets across all lines of business[27]. - In 2023, 64.5% of private passenger automobile exposures insured had an other than private passenger policy with the company, compared to 65.2% in 2022[48]. - The company distributes products exclusively through independent agents, with 97.1% of direct written premiums for automobile insurance obtained through voluntary agents in 2023[42]. Technology and Innovation - The company is focused on expanding technology to enhance the ease of doing business for independent agents, thereby strengthening relationships[27]. - The company introduced the Safety Commercial Express system in 2021, which was updated in 2022 to allow for agent processing of endorsements[69]. - The Innovation Lab conducted significant research on Generative AI in 2023, with results expected in 2024[71]. - The automated adjuster assignment system categorizes new claims by severity, improving claims management efficiency[73]. - The company has made substantial investments in information technology to enhance agent support and customer service[53]. - The company’s proprietary software applications facilitate real-time policy issuance and data imports from major agency management systems[60]. - The company’s cybersecurity strategy includes ongoing employee education and monitoring for emerging threats[70]. Financial Performance - The bad debt expense as a percentage of direct written premiums was 0.2% in 2023, compared to 0.1% in 2022[76]. - The total incurred losses and LAE for the year 2023 amounted to $642,302, compared to $491,979 in 2022, reflecting a significant increase[97]. - The company paid total losses and LAE of $608,048 in 2023, compared to $515,759 in 2022, showing an increase in claims payments[97]. - The cumulative amounts paid for claims one year later were $198,414 for 2023, indicating the company's ongoing claims management[99]. - The company decreased loss reserves related to prior years by $47,381 in 2023, $57,279 in 2022, and $53,673 in 2021, indicating a trend of releasing redundant reserves[100]. - The reserves for losses and LAE at the end of 2023 were $603,081, up from $549,598 at the end of 2022[99]. - Management believes that the provision for unpaid losses and LAE as of December 31, 2023, is adequate to cover the ultimate cost of losses and claims incurred[93]. Reinsurance Strategy - The company’s reinsurance strategy involves selective partnerships with financially stable reinsurers, most of which have an A.M. Best rating of "A+" or "A"[104]. - In 2023, the company purchased three layers of excess catastrophe reinsurance providing $590,000 of coverage for property losses in excess of $75,000 up to a maximum of $665,000[105]. - For 2024, the company has increased its reinsurance coverage to $615,000 for property losses in excess of $75,000 up to a maximum of $690,000[106]. Investment Portfolio - As of December 31, 2023, the company's investment portfolio was valued at $1,424,113, with 73.9% in fixed maturity securities[133]. - The company has a high-quality investment portfolio primarily consisting of investment grade corporate fixed maturity securities, U.S. government and agency securities, and asset-backed securities[130]. - The estimated fair value of U.S. Treasury securities and obligations of U.S. Government agencies was $247,237 million, representing 23.5% of the total portfolio[141]. - Total estimated fair value of fixed income securities was $1,052,145 million as of December 31, 2023, slightly up from $1,050,155 million in 2022[141]. - The portfolio of fixed maturity investments included 65.8% rated Category 1 and 18.8% rated Category 2 as of December 31, 2023[143]. - The company has a commitment to inclusiveness and actively seeks highly-qualified candidates from diverse backgrounds[120]. Employee and Management Information - The company employs 539 employees as of December 31, 2023, all located in the New England region[119]. - George M. Murphy has been with the Company for over 35 years and was elected Chairman of the Board on May 17, 2023[172]. - Christopher T. Whitford has served as Chief Financial Officer since March 2, 2020, and has over 11 years of experience with the Company[173]. - James D. Berry has been employed by the Company for over 41 years and has directed the Massachusetts Private Passenger line of business since 2001[176]. - Ann M. McKeown, Vice President of Insurance Operations, will retire effective March 1, 2024, after over 34 years with the Company[178]. - Brian S. Lam was appointed Vice President of Insurance Operations effective March 1, 2024, and has been with the Company since 2002[182]. - The Company has adopted a Code of Business Conduct and Ethics applicable to all employees and directors, available on its website[192]. Regulatory and Risk Management - The company is subject to comprehensive regulation by state insurance departments, with the most recent financial condition examination covering the five-year period ending December 31, 2018[152]. - The Company completed its Own Risk Solvency Assessment (ORSA) filing for the 2023 period, as required by the National Association of Insurance Commissioners[169]. - The Company has significant exposure to market risk primarily due to changes in interest rates, with fixed and variable rate debt as sources of financing[405]. - The Company holds a substantial amount of fixed maturity investments, including U.S. and foreign government bonds, which are sensitive to interest rate changes[406]. - The company does not plan to enter into any derivative financial instruments for trading or speculative purposes[405]. Financial Metrics - Total assets increased to $2,094,004 as of December 31, 2023, up from $1,972,569 in 2022, reflecting a growth of approximately 6.2%[430]. - Loss and loss adjustment expense reserves rose to $603,081 in 2023, compared to $549,598 in 2022, indicating an increase of about 9.7%[430]. - The company's total investments reached $1,424,113 as of December 31, 2023, compared to $1,403,160 in 2022, marking a growth of approximately 1.5%[430]. - Cash and cash equivalents increased to $38,152 in 2023 from $25,300 in 2022, representing a significant increase of about 50.9%[430]. - The allowance for expected credit losses for fixed maturities increased from $678 in 2022 to $1,208 in 2023, reflecting a rise of approximately 78.1%[430]. - Shareholders' equity decreased to $804,267 in 2023 from $811,999 in 2022, a decline of about 0.9%[430]. - Net investment income increased to $56,377 million in 2023, up 20.3% from $46,725 million in 2022[138]. - Net effective yield improved to 4.0% in 2023, compared to 3.2% in 2022, reflecting a 25% increase[138].

Exhibit 99.1 SAFETY INSURANCE GROUP, INC. ANNOUNCES FOURTH QUARTER AND YEAR ENDED 2023 RESULTS Boston, Massachusetts, February 27, 2024. Safety Insurance Group, Inc. (NASDAQ:SAFT) ("Safety" or the "Company") today reported fourth quarter and year ended 2023 results. George M. Murphy, Chairman of the Board of Directors, President and Chief Executive Officer, commented: "2023 saw Safety Insurance post record top-line growth as Direct Written Premiums increased by 20.4% as a result of a 10.2% increase in overa ...