Selective Insurance Group reported financial results for the second quarter of 2026, with net profit of $127.1 million and a combined ratio improvement of 98%.
Net income increased 52% in the second quarter of 2026 from the same period last year, while the combined ratio decreased by 2.2 percentage points from 100.2% in the second quarter of 2025, mainly due to lower catastrophe and non-catastrophe property losses.
Catastrophe losses contributed 5.6 percentage points to the combined ratio, and there was no increase in net casualty reserves in the prior year.
Net premiums written (NPW) decreased 5% from the prior year period as Selective continued to implement rate and non-rate actions to improve underwriting profitability. The result was driven by a 6% decline on standard commercial routes.
The pure price increase for contract renewal is 6.5%. In terms of investment, net investment income increased by 18% compared with the same period last year, reaching US$119 million after tax, and the annualized return on net assets in this quarter was 13.9 points.
Selective also reported that standard commercial insurance premiums fell 6% year-on-year (79% of net sum insured) due to lower new business.
The profitability move resulted in a 6.5% increase in average renewal pure price and an 81% improvement in retention rates due to prioritizing top-performing businesses over lower-performing segments.
Despite higher casualty costs during the year, the company’s combined ratio improved to 99.3%, benefiting from zero net casualty reserve development and lower non-catastrophe property losses in the prior year.
Standard personal lines premiums (8% of total NPW) fell 8% year over year, and new business fell 36%. The pure price for renewal is 8.9% and the retention rate is 79%.
The combined ratio rose 3.9 percentage points to 95.5% in the second quarter of 2026, driven by higher non-catastrophe losses and higher expense ratios, partially offset by lower catastrophe losses.
Excess and surplus line premiums (13% of total NPW) fell 2% compared with the second quarter of 2025, and average renewal net price increased 3.4%.
The combined ratio was 91.8%, an increase of 2.0 percentage points from the same period last year. The increase was due to higher casualty loss costs and non-catastrophe property losses during the year, partially offset by lower catastrophe losses.
“Our results reflect disciplined execution in an increasingly competitive environment. Operating ROE for the quarter was 13.7%, marking our eighth consecutive quarter of double-digit operating returns. With our strong capital position and commitment to delivering long-term value, we returned 45% of net income after tax through regular dividends and $32 million in share repurchases. Even with this return of capital, book value per share increased 3% in the quarter,” said John J., Chairman, President and Chief Executive Officer. Marchioni said.
Adding: “Over the past two years, we have taken thoughtful actions to improve the quality and long-term profitability of our underwriting portfolio. While these decisions resulted in lower premiums during the quarter, they reflect the underwriting discipline that has long distinguished Selective and our commitment to pursuing growth where risk-adjusted returns are most attractive.”
