Selective Insurance Group reported $53.2 million net income for its 2014 third quarter, a 62.7 percent increase from $32.7 million net income during the third quarter of 2013.
The Branchville, New Jersey-based insurer’s operating income for the third quarter was $43.3 million, up 81.2 percent from $23.9 million a year ago. The GAAP combined ratio for the third quarter was 92.6, improving from 97.7 one year ago. (The statutory combined ratio was 91.5, compared to 96.3 a year ago.)
Total net premiums written (NPW) for the third quarter were $495.1 million, up 0.5 percent from $492.7 million a year ago. Standard Commercial Lines NPW were $376.4 million, same as a year ago. Standard Personal Lines NPW were $79.1 million, down 2.1 percent from $80.8 million a year ago. Excess and Surplus Lines NPW were $39.6 million, up 11.5 percent from $35.5 million last year.
Favorable prior year statutory reserve development on casualty lines, pre-tax, totaled $8.0 million, compared to $3.5 million last year.
Net investment income, after tax, for the quarter was $25.8 million, up 5.3 percent from $24.5 million a year ago.
“The overall statutory combined ratio of 91.5 percent, coupled with after-tax net investment income growth of 5 percent, generated strong operating income per diluted share growth of 81 percent to $0.76,” said Gregory Murphy, chairman and chief executive officer.
“Three years ago, we established a plan to achieve a statutory combined ratio, excluding catastrophes, of 92 percent for 2014. With a nine-month statutory combined ratio, excluding catastrophes, of 91.8 percent, we are confident in our ability to reach our goal.”
Murphy also said overall net premiums written grew 0.5 percent due to renewal pure price increases of 5.4 percent and retention of 82 percent.
The standard Commercial Lines renewal pure price increased 5.3 percent in the quarter, said Murphy. “For several years we have earned rate above loss inflation trends and at higher levels than the industry,” said Murphy.
The standard Personal Lines renewal pure price increased 6.8 percent. Net premiums written for standard Personal Lines declined 2 percent in the quarter due to the company’s strategic non-renewal of dwelling fire business and reduction in monoline homeowners, said Murphy. He also said Excess and Surplus Lines net premiums written rose 11 percent in the quarter, due to a 10 percent increase in new business.
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