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Mar 31, 2023
Selective Insurance Q1 2023 Earnings Report
Reported net income of $1.48 per diluted common share and non-GAAP operating income of $1.44 per diluted common share.
Key Takeaways
Selective Insurance Group reported strong first quarter 2023 results, with net income per diluted common share of $1.48 and non-GAAP operating income per diluted common share of $1.44. The combined ratio was a profitable 95.7%, inclusive of 6.1 points of catastrophe losses. Net premiums written increased 12% year-over-year, driven by renewal pure price increases, solid retention, new business, and strong exposure growth.
Net premiums written increased 12% compared to the first quarter of 2022.
GAAP combined ratio of 95.7%, compared to 93.1% in the first quarter of 2022.
Commercial Lines renewal pure price increases averaged 7.0%, compared to 4.8% in the first quarter of 2022.
After-tax net investment income of $73 million, up 25% compared to the first quarter of 2022.
Selective Insurance
Selective Insurance
Selective Insurance Revenue by Segment
Revenue by Segment
Standard Commercial Lines Revenue
CapyFin.comStandard Personal Lines Revenue
CapyFin.com Forward Guidance
For 2023, the full-year expectations remained unchanged.
Positive Outlook
- A GAAP combined ratio of 96.5%, including net catastrophe losses of 4.5 points.
- Combined ratio estimate assumes no additional prior year casualty reserve development.
- After-tax net investment income of $300 million that includes after-tax net investment income from alternative investments of $30 million.
- An overall effective tax rate of approximately 21%, which assumes an effective tax rate of 20% for net investment income and 21% for all other items.
- Weighted average shares of 61 million on a fully diluted basis.
Challenges Ahead
- Difficult conditions in global capital markets, the banking sector, commercial real estate, and the economy, including prolonged higher inflation
- Deterioration in the public debt and equity markets and private investment marketplace
- Frequency and severity of catastrophic events, including natural events and man-made events
- Adverse market, governmental, regulatory, legal, or judicial conditions or actions
- The geographic concentration of our business in the eastern portion of the United States
Revenue & Expenses
Visualization of income flow from segment revenue to net income