Selective Insurance Group (SIGI) Q3 2024 earnings summary

Executive summary

• Operating earnings per share were $1.40, with an operating ROE of 12.1%–12.6% for Q3 2024, despite elevated catastrophe losses adding 13.4 points to the combined ratio.

• Net premiums written increased 9% year-over-year, driven by renewal price increases and stable retention in Standard Commercial Lines.

• Book value per share rose 21% year-over-year to $48.82, with adjusted book value per share up 5% to $50.80.

• Quarterly dividend increased 9% to $0.38 per share; 103,000 shares repurchased for $8.7 million, with $75.5 million remaining under authorization.

• Net income for Q3 2024 was $92.3 million, up 3% year-over-year, but nine-month net income fell 54% due to higher catastrophe and casualty losses.

Financial highlights

• Fully diluted net income was $1.47 per share; non-GAAP operating income was $1.40 per share for Q3 2024.

• Combined ratio was 99.5% for Q3 2024, up 2.7 points year-over-year, mainly due to $149 million in catastrophe losses from 19 events, including $85 million from Hurricane Helene.

• Net premiums written for Q3 2024 were $1,157.6 million, up 9% year-over-year; net premiums earned rose 13%.

• After-tax net investment income was $93–93.4 million, up 16% year-over-year, with annualized after-tax yield at 4.0%.

• Debt-to-capital ratio was 13.8%, with $508 million in total debt and $3.2 billion in equity.

Outlook and guidance

• 2024 GAAP combined ratio guidance raised to 102.5% due to higher catastrophe loss assumptions; net catastrophe losses expected at 7.5 points.

• After-tax net investment income for 2024 expected at $360 million, including $32 million from alternative investments.

• Effective tax rate guidance is 21% overall.

• Losses from Hurricane Milton expected to be immaterial.