Selective(US:SIGI)2025-10-24 17:08Financial Performance - Revenues for Q3 2025 reached $1,360,110, a 9% increase from $1,244,306 in Q3 2024[85] - After-tax net investment income rose to $109,967, an 18% increase compared to $93,379 in Q3 2024[85] - Net income available to common stockholders for Q3 2025 was $113,040, up 26% from $89,978 in Q3 2024[85] - The company reported a net income of $115,340 for Q3 2025, a 25% increase from $92,278 in Q3 2024[85] - Diluted net income per share for Q3 2025 was $1.85, a 26% increase from $1.47 in Q3 2024[85] - Non-GAAP operating income for Q3 2025 was $106,675, a 24% increase from $85,720 in Q3 2024[86] - For the first nine months of 2025, the company reported an ROE of 13.0% and a non-GAAP operating ROE of 12.6%, exceeding the 12% target[88] Underwriting Performance - The combined ratio improved to 98.6% in Q3 2025 from 99.5% in Q3 2024, reflecting better underwriting performance[85] - The combined ratio improved to 98.6% in Q3 2025, down from 99.5% in Q3 2024, primarily due to lower catastrophe losses and improved underwriting results[91] - The company expects a GAAP combined ratio between 97% and 98% for the full year 2025, including net catastrophe losses of four points[90] - The combined ratio for Q3 2025 was 101.1%, an increase of 1.9 points compared to 99.2% in Q3 2024[101] - The combined ratio improved to 110.1 in Q3 2025 from 122.1 in Q3 2024, and to 99.9 from 115.2 for the first nine months[124] Premiums and Growth - The net premiums written (NPW) grew by 4% in Q3 2025 and 6% in the first nine months of 2025, supported by renewal pure price increases of 9.9%[91] - Direct new business premiums for Q3 2025 were $146.6 million, a 5% increase from $139.2 million in Q3 2024[102] - NPW for Commercial Automobile increased by 4% in Third Quarter 2025 and 6% in Nine Months 2025, driven by renewal price increases and lower retention[115] - NPW for Commercial Property grew by 7% in Third Quarter 2025 and 8% in Nine Months 2025, benefiting from renewal price increases and exposure growth[119] - NPW for Workers Compensation decreased by 7% in Third Quarter 2025 and 8% in Nine Months 2025, attributed to declines in renewal pure price and direct new business[121] Investment Performance - Total invested assets increased by $1.4 billion to $11,051,525, reflecting a 15% growth compared to December 31, 2024[141] - Net unrealized losses on fixed income securities decreased by 67% to $(104,853) from $(316,796) year-over-year[141] - Net investment income earned after tax rose by 18% to $109,967 for Q3 2025 compared to $93,379 in Q3 2024[142] - The annualized after-tax yield on the investment portfolio improved to 4.1% for Q3 2025, up from 4.0% in Q3 2024[142] - Net unrealized gains on equity securities increased by 224% to $7,802 in the third quarter of 2025[143] Capital Management - As of September 30, 2025, the company reported GAAP stockholders' equity of $3.5 billion and statutory surplus of $3.4 billion, with total debt of $902.3 million, resulting in a debt-to-capital ratio of 20.5%[164] - The company issued $400 million of 5.90% Senior Notes due 2035, generating net proceeds of $395.9 million, which includes a $200 million capital contribution to the Insurance Subsidiaries[159] - The company repurchased 698,312 shares of common stock for $55.6 million at an average price of $79.60 per share, with $19.9 million remaining under the share repurchase program as of September 30, 2025[160] - A quarterly cash dividend of $0.43 per common share was declared, representing a 13% increase, payable on December 1, 2025[161] Loss and Expense Management - Current year casualty loss costs increased by 24% in Q3 2025 compared to Q3 2024, totaling $584.5 million[93] - The loss and loss expense incurred increased by 11% to $657.9 million in Q3 2025, with a total of $1.91 billion for the nine months ended September 30, 2025[103] - Current year casualty loss costs increased by 30% in Q3 2025 compared to Q3 2024, driven by higher loss trend expectations[132] - The underwriting expense ratio increased by 0.4 points for the nine months ended September 30, 2025, primarily due to higher profit-based compensation[100] Technology and Innovation - The company is actively investing in technology to enhance underwriting scalability and claims outcomes, including the development of artificial intelligence use cases[90] Market Conditions - The company maintains strong ratings from major agencies, including an A+ from AM Best and Fitch, with a stable outlook[175]