10-Q · July 24, 2026
Selective delivered a strong Q2: revenue rose 5% to $1.387B, GAAP diluted EPS increased 55% to $2.11, and the combined ratio improved to 98.0%. Better catastrophe experience and the absence of the prior-year $45.0M…
Earnings analysis · 10-Q
SIGI earnings analysis
Filed October 23, 2026 · Our reading of the company's report
The latest report
Selective delivered stronger underwriting and investment-driven earnings in Q3 2026, with GAAP diluted EPS of $2.11 versus $1.85 a year ago and a 1.8-point improvement in the combined ratio to 96.8%. However, revenue…
Read full summary
Selective delivered stronger underwriting and investment-driven earnings in Q3 2026, with GAAP diluted EPS of $2.11 versus $1.85 a year ago and a 1.8-point improvement in the combined ratio to 96.8%. However, revenue fell 2% year over year and 7% of premium volume was deliberately reduced, while E&S underwriting weakened and catastrophe losses increased. Cash generation remained solid at $817.7 million year to date, but higher interest rates drove book value per share down to $55.02. Overall, improved core profitability and higher investment-income guidance are offset by premium contraction, casualty severity, catastrophe volatility, and investment-market losses.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
Where revenue came from
The business segments reported by the company.
Shares of the segments disclosed in this filing, largest first.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $2.11
What stood out
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Earnings and operating EPS improved
Q3 GAAP net income available to common stockholders was $126.4 million, or $2.11 diluted EPS, up 12% and 14%, respectively, from $113.0 million and $1.85 in Q3 2025. Non-GAAP operating EPS was $2.37, up 35% from $1.75.
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Underwriting profitability strengthened
The combined ratio improved to 96.8% from 98.6%, a 1.8-point improvement, while after-tax underwriting income increased 124% to $29.5 million from $13.2 million. The loss ratio improved 3.3 points to 64.6%, although the expense ratio increased 1.5 points to 32.1%.
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Investment income remained a key driver
After-tax net investment income rose 16% to $127.3 million from $110.0 million, supported by active portfolio management and operating cash-flow deployment. Full-year investment-income guidance was raised to $490 million from $480 million.
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Core standard lines improved
Standard Commercial Lines underwriting income improved to $19.2 million from a $10.2 million loss, with its combined ratio improving 3.2 points to 97.9%. Standard Personal Lines also improved, with its combined ratio declining 6.9 points to 103.2%.
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Cash generation remained positive
Operating cash flow was $817.7 million in the first nine months of 2026, versus $856.8 million in the prior-year period, primarily due to lower cash received for premiums. Net cash used in investing was $618.2 million, compared with $1.2 billion in the prior-year period.
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Capital returns expanded
The company returned $81 million to common stockholders in Q3 through dividends and share repurchases. It repurchased 1,300,663 shares for $116.9 million in the first nine months and authorized an additional $200 million program, bringing available repurchase capacity to $253.1 million.
What to watch
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Premium volume contracted
Revenue declined 2% year over year to $1.326 billion, while Q3 net premiums written fell 7% to $1.123 billion. Management attributed lower premium volume to reduced new business, increased competition, and deliberate actions to reduce retention on underperforming business.
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E&S loss performance weakened
E&S Lines underwriting deteriorated materially: its Q3 combined ratio increased 10.3 points to 86.5%, loss and loss expense incurred rose 24% to $88.9 million, and underwriting income fell 43% to $21.3 million. Management cited social-inflation severity assumptions, property-loss variability, and weather events.
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Catastrophe losses increased
Net catastrophe losses increased to $64.1 million in Q3 from $24.9 million, or 5.4 loss-ratio points versus 2.1 points. Standard Commercial property catastrophe losses rose to $36.4 million from $13.1 million, driven by higher frequency and severity of storms.
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Higher rates pressured book value
Book value per share fell to $55.02 from $56.74 at December 31, 2025, primarily due to a $5.80 increase in after-tax unrealized fixed-income losses. Pre-tax net unrealized investment losses widened to $503.4 million from $74.1 million, reflecting higher interest rates.
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Casualty severity remains elevated
Standard Commercial Lines reported $1.4 billion of current-year casualty loss costs in the first nine months, up 3%, with management citing elevated severity trends from social inflation and commercial automobile claim frequencies. General liability's nine-month combined ratio remained 106.8%.
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Geopolitical and financing exposure
The filing added geopolitical risk disclosure: Middle East military conflict has contributed to higher energy and transportation costs and financial-market volatility, which could increase loss costs and reinsurance expense. The company reported $902 million of total debt and a 20.7% debt-to-capital ratio at September 30, 2026.
Management's outlook
Full-year 2026 quantitative outlook includes after-tax net investment income of $490 million, raised from $480 million; GAAP combined ratio of 96.5%-97.5%, including 5.5 catastrophe-loss points; effective tax rate of 21.5%; and fully diluted weighted-average shares of 59.9 million. No numeric EPS or revenue guidance was provided.
Earlier filings 4
10-Q · April 24, 2026
Selective reported first-quarter 2026 revenues of $1,358,925,000 (up 6% YoY) and GAAP diluted EPS of $1.58 (down 10% YoY). Investment income was a bright spot with after-tax net investment income of $113,065,000 (up 18%…
10-Q · October 24, 2025
Selective reported third-quarter 2025 revenues of $1,360,110 (in thousands) and diluted EPS of $1.85, both up versus Q3 2024. Underwriting and investment income supported higher pre-tax income, but the company…
10-Q · July 25, 2025
Selective reported second-quarter 2025 revenue of $1,326,745,000 and diluted EPS of $1.36, reversing a year-ago loss and driving net income available to common of $83,643,000. Revenue rose 10.9% year-over-year and 3.2%…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.