Selective Ins Stock Price, News & Analysis
Company Description
Selective Insurance Group, Inc. (Nasdaq: SIGI) is a holding company in the finance and insurance sector that focuses on direct property and casualty insurance. The group oversees 10 property and casualty insurance companies that, according to multiple company and rating agency disclosures, are rated “A+” (Superior) by AM Best. Selective operates in the direct property and casualty insurance carriers industry and distributes its products through independent agents.
Based on available information, Selective’s insurance operations are organized into several key segments. The company classifies its business into standard commercial lines, excess and surplus lines, and standard personal lines. In AM Best’s description of the group, standard commercial lines represent the majority of net premiums written, followed by excess and surplus lines and standard personal lines. These segments reflect the company’s focus on commercial risks as well as personal insurance needs.
Selective’s property and casualty insurance companies offer standard insurance for commercial and personal risks and specialty insurance for commercial risks. In addition, Selective participates in the National Flood Insurance Program as a servicing carrier in the “Write Your Own” flood insurance program, offering flood insurance under that federal program. The company’s business is distributed through independent agents, and AM Best notes that Selective emphasizes close working relationships with selected agencies and the use of technology to support underwriting and servicing capabilities.
According to rating agency commentary, Selective’s business profile is supported by a low- to medium-hazard business mix, a conservative underwriting philosophy, and catastrophe risk mitigation initiatives. The group’s balance sheet strength is assessed by AM Best as its strongest, supported by risk-adjusted capitalization, a reinsurance program, a low-risk investment profile, and financial flexibility provided by its publicly traded parent company. AM Best also highlights a history of underwriting profitability and growing investment income.
Selective’s insurance operations are complemented by an investments segment, which manages the group’s investment portfolio and contributes to overall results through net investment income. Company financial disclosures describe how net investment income, together with underwriting results, influences return on equity and book value per common share. The company also has issued various senior unsecured notes and preferred stock, which are referenced in AM Best’s credit rating affirmations.
Geographically, Selective’s operations are concentrated in the eastern portion of the United States, as noted in the company’s discussion of risk factors. The group has expanded its standard commercial lines footprint over time, adding states and moving toward what it describes as a near-national footprint for that segment. The company’s headquarters and principal operations are located in Branchville, New Jersey, where both the parent and its insurance subsidiaries are based.
Selective is also described in company communications as an employer of choice. It has received recognition such as inclusion in Forbes Best Midsize Employers and certification as a Great Place to Work® for multiple consecutive years. These acknowledgments are cited by the company as part of its positioning in the insurance market and in attracting and retaining talent.
From a capital management perspective, Selective’s public disclosures and SEC filings reference share repurchase programs, quarterly cash dividends on common stock, and dividends on its non-cumulative preferred stock. The company’s Board of Directors has authorized repurchase programs that allow the company to buy back shares of its common stock, and these programs are discussed in Form 8-K filings and earnings releases. The company also communicates expectations around combined ratios, net investment income, and other performance measures in its public guidance.
Overall, Selective Insurance Group, Inc. is positioned as a regional and expanding property and casualty insurance organization with a focus on commercial lines, supported by personal lines, excess and surplus lines, and participation in the National Flood Insurance Program. Its operations are grounded in relationships with independent agents, underwriting discipline, and an investment portfolio that supports its insurance obligations.
Business Segments
According to AM Best and company financial disclosures, Selective organizes its insurance operations into three primary segments:
- Standard Commercial Lines – This segment represents the largest share of net premiums written. It focuses on standard insurance products for commercial risks. Company commentary emphasizes renewal pricing actions, retention metrics, and combined ratio performance for this segment.
- Excess and Surplus Lines – This segment provides specialty insurance for commercial risks that may not fit standard underwriting criteria. It has been identified as a contributor to growth in net premiums written and has its own combined ratio and loss metrics disclosed in company results.
- Standard Personal Lines – This segment covers standard insurance for personal risks. Company disclosures describe deliberate profit improvement actions in this segment, including pricing and underwriting changes, and discuss its share of total net premiums written.
In addition to these insurance segments, Selective reports an investments segment that manages the group’s investment assets. Earnings releases describe net investment income, portfolio yields, and the contribution of investment income to return on equity.
Financial Strength and Ratings
AM Best has affirmed the Financial Strength Rating of A+ (Superior) and the Long-Term Issuer Credit Ratings of “aa-” (Superior) for the pooled members of Selective Insurance Group. The ultimate parent, Selective Insurance Group, Inc., holds a Long-Term Issuer Credit Rating of “a-” (Excellent) and various Long-Term Issue Credit Ratings on its senior unsecured notes and other securities. The outlooks on these ratings are described as stable.
AM Best’s analysis cites Selective’s balance sheet strength, operating performance, business profile, and enterprise risk management. It notes strongest risk-adjusted capitalization, a comprehensive reinsurance program, a low-risk investment profile, and financial flexibility from the publicly traded parent. At the same time, AM Best identifies limiting factors such as exposure to catastrophe losses and periods of net adverse reserve development.
Distribution and Underwriting Approach
Selective distributes its insurance products through independent agents. AM Best describes the group’s favorable business profile as being based in part on close working relationships with selected agencies and the use of technology to enhance underwriting and servicing capabilities. Company financial communications also highlight a focus on pricing, underwriting actions, and risk selection to address loss cost trends and social inflation.
Recognition as an Employer
Company news releases state that Selective’s position as both an insurance group and an employer is widely recognized. The organization has been listed in Forbes Best Midsize Employers and has achieved Great Place to Work® certification for multiple consecutive years. These recognitions are presented by the company as evidence of its workplace culture and its ability to attract experienced insurance and actuarial professionals.
Stock and Capital Structure
Selective Insurance Group, Inc. trades on The Nasdaq Stock Market under the symbol SIGI. The company also has depositary shares representing interests in its 4.60% Non-Cumulative Preferred Stock, Series B, which trade under the symbol SIGIP, as disclosed in SEC filings. AM Best and SEC documents reference several series of senior unsecured notes and preferred securities issued by the company, each with associated credit ratings.
Risk Factors and Geographic Concentration
In its forward-looking statements and risk factor discussions, Selective identifies a number of potential influences on its results, including economic conditions, capital markets, catastrophe events, regulatory changes, reinsurance availability, social inflation, and cyber risk. The company notes a significant geographic concentration of business in the eastern portion of the United States, which can affect exposure to certain weather-related catastrophes and regional economic trends.