Selective Insurance Group Reports Growth in Q4 2025 and Industry Outlook
Selective Insurance Group, Inc. (NASDAQ: SIGI) is a prominent U.S.-based provider of property and casualty insurance. The company operates through specialized subsidiaries offering a comprehensive range of commercial, personal, and excess and surplus insurance products, targeting small to mid-sized enterprises and individual clients. Their operations are categorized into three main segments: Standard Commercial Lines, Standard Personal Lines, and Excess and Surplus Lines. The distribution of their insurance products is efficiently managed through independent agents and brokers, emphasizing disciplined underwriting, strategic pricing, and precise risk management.
In the fourth quarter ending December 31, 2025, Selective Insurance Group reported a total revenue of $1,364.9 million, up from $1,252.1 million in the same period the previous year. Net income available to common stockholders rose significantly to $152.9 million from $93.4 million in Q4 2024, with diluted earnings per share at $2.52. For the entire year of 2025, total revenue grew to $5,336.9 million from $4,861.7 million in 2024. Net income also increased substantially to $457.2 million compared to $197.8 million the previous year. An improvement in the full-year combined ratio was noted, decreasing to 97.2% from the prior year's 103.0%.
Refining Underwriting and Risk Management
Selective Insurance Group dedicated efforts towards refining their underwriting and pricing strategies during the quarter. The company achieved average renewal price increases of 8.3% for the quarter and 9.5% for the year. In Q4 FY25, net premiums written for Standard Commercial Lines amounted to $875.6 million, while Excess and Surplus Lines recorded $158.4 million. Conversely, net premiums for Standard Personal Lines decreased to $95.5 million. After-tax net investment income experienced growth, reaching $114.2 million for the quarter and $421.2 million for the full year.
Industry Challenges and Regulatory Compliance
The company acknowledges exposure to industry risks including catastrophe losses, claims severity, and fluctuations in reinsurance pricing. Regulatory compliance requirements may also influence pricing strategies. Investment income can vary with interest rate changes and shifting capital market conditions, posing additional risk management challenges.
2026 Operational Benchmarks
Looking ahead to 2026, Selective Insurance Group has set operational benchmarks with an anticipated GAAP combined ratio between 96.5% and 97.5%. They project six points for catastrophe losses and foresee after-tax net investment income approximating $465 million. The effective tax rate is expected to be approximately 21.5%, with the forecasted weighted average of diluted shares outstanding at about 61 million.
In summary, Selective Insurance Group reports increased revenues and net incomes for the concluding quarter of FY25, highlighting improvements in both underwriting and investment income metrics compared to 2024. Standard Commercial Lines remain the primary contributors to their premium writings, demonstrating the company's strategic focus on disciplined underwriting and risk management.