Selective Insurance Group Inc · Q2 2021 earnings

Briefing

Selective reported excellent financial results, driven by superior underwriting and investment performance.

Selective Insurance Group reported excellent second quarter results with a net income of $1.98 per diluted common share and a non-GAAP operating income of $1.85 per diluted common share. The company's combined ratio was a solid 89.8%, with all insurance segments delivering profitable results. Overall NPW increased 15% from a year ago, driven by strong new business growth, renewal pure price increases, and continued solid retention.

• Net premiums written increased 15% compared to the second quarter of 2020.
• GAAP combined ratio of 89.8%.
• After-tax net investment income of $67 million, up 136% compared to the second quarter of 2020.
• Book value per common share of $44.78.

Headline financials

Revenue & EPS history

Selective has revised its full-year guidance as follows: A GAAP combined ratio, excluding catastrophe losses, of 89% (prior guidance 90%) that assumes no additional prior-year casualty reserve development; Catastrophe losses of 4.0 points on the combined ratio; After-tax net investment income of $220 million (prior guidance $195 million) that includes $55 million (prior guidance of $31 million) in after-tax net investment income from our alternative investments; An overall effective tax rate of approximately 20.5% that includes an effective tax rate of 19.0% for net investment income and 21.0% for all other items; and Weighted average shares of 60.5 million on a fully diluted basis.