What is the market's earnings forecast for Selective Insurance next quarter?

What is the revenue and EPS growth rate for Selective Insurance year over year?

What does Selective Insurance do and what are its main business segments?

Did Selective Insurance beat or miss consensus estimates last quarter?

What is Selective Insurance's gross profit margin?

What were the key takeaways from Selective Insurance’s earnings call?

What guidance did Selective Insurance's management provide for the next earnings period?

What factors drove the changes in Selective Insurance's revenue and profit?

- **Operating Performance**: 13.2% Q3 operating ROE, with full-year target of 14%, despite 98.6% combined ratio driven by New Jersey casualty reserve issues.
- **Financial Strength**: 26% EPS growth, $110M investment income, and 13% dividend increase highlight strong capital management.
- **Strategic Focus**: Commercial auto rate hikes (8.9%), E&S expansion, and AI-driven efficiency to offset social inflation pressures.
- **Reserve Confidence**: External reviews validate reserves, with no claims management issues identified.

**【CEO Summary Section】**
- Delivered an operating return on equity (ROE) of 13.2% for the quarter, with a full-year target of 14%.
- Combined ratio for the quarter was 98.6%, driven by 3.3 points of unfavorable prior year casualty reserve development, primarily in New Jersey's commercial auto line.
- Implemented strategic actions in commercial auto, including rate increases (8.9% renewal pure price), tighter underwriting guidelines, and telematics solutions to address rising severity trends.
- Emphasized long-term profitability over short-term growth, with a focus on risk selection, diversification, and AI-driven efficiency.

**【CFO Financial Commentary】**
- Fully diluted EPS of $1.85, up 26% year-over-year; non-GAAP operating EPS of $1.75, up 25%.
- After-tax net investment income of $110 million, up 18% YoY, contributing 13.6 points to ROE.
- Full-year guidance updated to a GAAP combined ratio of 97%-98%, including 4 points of catastrophe losses (down from 6 points previously) and 2 points of prior year reserve development.
- Announced a 13% dividend increase and $36 million in share repurchases, with a new $200 million repurchase authorization.

**【Q&A Key Highlights】**
- **Commercial Auto Challenges**: New Jersey accounts for 15% of commercial auto premium, with severity trends driven by social inflation. Actions include rate hikes, underwriting tightening, and telematics adoption.
- **Reserve Confidence**: External reviews confirm reserves are above industry central estimates, with no evidence of claims management issues.
- **Growth Strategy**: Prioritizes profitable growth through diversification (e.g., E&S expansion, personal lines target market focus) and disciplined expense management.
- **Capital Management**: Maintains 20%-25% earnings return via dividends, with opportunistic share buybacks reflecting confidence in stock valuation.

SIGI

SIGI fundamentals

You can ask Aime