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Sep 30, 2024
Selective Insurance Q3 2024 Earnings Report
Selective Insurance reported net income of $1.47 per diluted common share and non-GAAP operating income of $1.40 per diluted common share for Q3 2024.
Key Takeaways
Selective Insurance Group reported a strong third quarter with net income per diluted common share at $1.47 and non-GAAP operating income per diluted common share at $1.40. The company faced elevated catastrophe losses, but underlying performance remained excellent due to disciplined underwriting and pricing.
Net premiums written increased 9% from the third quarter of 2023.
The GAAP combined ratio was 99.5%, impacted by net catastrophe losses.
Commercial Lines renewal pure price increases averaged 9.1%.
After-tax net investment income was $93 million, up 16% from the third quarter of 2023.
Revenue by Segment
Forward Guidance
Selective Insurance increased its expected GAAP combined ratio for 2024 to 102.5%, reflecting elevated catastrophe losses. They anticipate after-tax net investment income of $360 million and an effective tax rate of approximately 21.0%.
Positive Outlook
- After-tax net investment income of $360 million that includes $32 million from alternative investments.
- An overall effective tax rate of approximately 21.0%, which assumes an effective tax rate of 20.5% for net investment income and 21% for all other items.
- Weighted average shares of 61.5 million on a fully diluted basis.
- Combined ratio estimate assumes no additional prior year casualty reserve development
- Expect losses from Hurricane Milton, which made landfall on October 9, 2024, to be immaterial.
Challenges Ahead
- A GAAP combined ratio of 102.5%, up 1 point from our prior guidance of 101.5%.
- Our combined ratio estimate includes net catastrophe losses of 7.5 points, up from prior guidance of 5.5 points.
Revenue & Expenses
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Historical Earnings Impact
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Avg. Return Before/After Earnings
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