Selective Insurance (SIGI) 8-K Selective Insurance Group Reports

Exhibit 99.2

	®
Supplemental Investor Package ________________________________________________________________ Second Quarter 2008
Investor Contact: Jennifer DiBerardino Vice President, Investor Relations Tel:  973-948-1364 Jennifer.diberardino@selective.com

SELECTIVE INSURANCE GROUP, INC.

2008 Guidance

As of July 31, 2008

Reflecting six month results, we are tightening our earnings guidance range to $2.00 to $2.20 from $2.00 to $2.30 based on the following revised full-year assumptions:

·   A statutory combined ratio between 99% and 100%;

·   A GAAP combined ratio between 100% and 101%;

·   After-tax catastrophe losses of $19 million, or $0.36 per share;

·   After-tax investment income being flat to down 2%;

·   Diversified Insurance Services revenue decrease of 1% and return on revenue of  approximately 10%; and

·   Diluted weighted average shares of 52.5 million.

 Selective Insurance Group, Inc.

 Selected Balance Sheet Data (unaudited)

 ($ in thousands, except per share amounts)

		June 30,							June 30,							December 31,
		2008							2007							2007
		Balance		Market		Unrealized			Balance		Market		Unrealized			Balance		Market		Unrealized
		Sheet		Value		Gain/(Loss)			Sheet		Value		Gain(Loss)			Sheet		Value		Gain/(Loss)
Invested Assets:
	Corporate bonds	$	1,173,576		1,173,577		(44,051	)	$	1,062,255		1,062,257		(1,319	)	$	1,282,643		1,282,645		(910	)
	Gov't\ Municipal bonds		1,874,781		1,874,872		6,690			1,847,286		1,847,459		(16,548	)		1,796,687		1,796,829		24,688
Total bonds			3,048,357		3,048,449		(37,361	)		2,909,541		2,909,716		(17,867	)		3,079,330		3,079,474		23,778
	Equities		212,838		212,838		69,754			321,021		321,021		143,742			274,705		274,705		114,315
	Short-term investments		218,074		218,074		-			135,298		135,298		-			190,167		190,167		-
	Trading securities		23,196		23,196		5,214			-		-		-			-		-		-
	Other investments		206,410		206,410		26,258			175,506		175,506		31,500			188,827		188,827		30,647
Total invested assets			3,708,875		3,708,967		63,865			3,541,366		3,541,541		157,375			3,733,029		3,733,173		168,740
Total assets			5,079,175							4,851,655							5,001,992
	Liabilities:
	Reserve for losses		2,262,310							2,069,811							2,182,572
	Reserve for loss expenses		375,451							347,686							359,975
	Unearned premium reserve		868,851							863,187							841,348
Total liabilities			4,061,463							3,848,288							3,925,949
Stockholders' equity			1,017,712							1,003,367							1,076,043
Total debt to capitalization ratio			21.2%							24.9%							21.5%
Adjusted total debt to capitalization ratio *			15.3%							18.5%							15.2%
Book value per share			19.32							18.76							19.81
Book value per share excluding
	FAS 115 unrealized gain or loss on bond portfolio		19.78							18.98							19.53
NPW per insurance segment employee			802							780							797
Statutory premiums to surplus ratio			1.5x							1.4x							1.5x
Statutory surplus			999,676							1,059,939							1,034,294

* The adjusted debt to capitalization ratio reflects a reduction in debt for amounts held in an irrevocable trust for the benefit of senior note holders as well as the median rating agency equity treatment of 75% applied to our $100 million Junior Subordinated Notes issued September 25, 2006.

Selective Insurance Group, Inc.
Selected Income Statement Data (unaudited)
June 30, 2008		THREE MONTHS ENDED JUNE 30,												SIX MONTHS ENDED JUNE 30,
($ in thousands, except per share amounts)		2008						2007						2008						2007
					Per diluted share						Per diluted share						Per diluted share						Per diluted share
Consolidated
	Revenue	$	447,352					$	462,038					$	898,465					$	924,147
	Operating income		27,401			0.52			27,340			0.49			46,919			0.88			57,284			0.99
	Net realized gains, after tax		1,250			0.02			8,546			0.15			2,235			0.04			15,854			0.27
	Net Income		28,651			0.54			35,886			0.64			49,154			0.92			73,138			1.26
	Operating return on equity		10.6%						10.7%						9.0%						11.0%
Insurance Operations
	Gross premiums written		443,767						455,216						883,812						916,179
	Net premiums written		387,229						404,923						777,069						822,108
	Net premiums earned		375,089						376,351						756,362						756,364
	Underwriting (loss) profit - before tax		(3,251	)					(145	)					(4,703	)					9,572
- after tax			(2,113	)		(0.04	)		(94	)		-			(3,057	)		(0.06	)		6,222			0.11
	GAAP combined ratio		100.9%						100.0%						100.6%						98.7%
Commercial lines
	Net premiums earned		323,032						325,966						653,009						654,977
	GAAP combined ratio		100.0%						97.9%						99.3%						97.1%
Personal lines
	Net premiums earned		52,057						50,385						103,353						101,387
	GAAP combined ratio		106.1%						114.1%						108.7%						109.8%
Diversified Insurance Services
	Revenue		30,064						30,677						59,863						59,855
	Income  - after tax		3,270			0.06			4,019			0.07			6,083			0.11			6,923			0.12
	Return on revenue		10.9%						13.1%						10.2%						11.6%
Investments
	Net investment income - before tax		38,515						40,642						76,381						80,505
- after tax			30,082			0.57			31,788			0.56			59,453			1.11			62,945			1.07
	Effective tax rate		21.9%						21.8%						22.2%						21.8%
	Annual after-tax yield on investment portfolio														3.2%						3.5%
	Annual after-tax, after-interest expense yield														2.8%						3.1%
	Invested assets per $ of stockholders' equity													$	3.64						3.53
Other expenses (net of other income)
	Interest expense - before tax		(5,127	)					(5,992	)					(10,436	)					(12,323	)
	Actual interest expense - after tax		(3,333	)					(3,895	)					(6,783	)					(8,010	)
	Interest expense addback for dilution - after tax		-						347						-						753
	Adjusted interest expense - after tax		(3,333	)		(0.06	)		(3,548	)		(0.06	)		(6,783	)		(0.13	)		(7,257	)		(0.12	)
	Other - after tax	$	(505	)		(0.01	)	$	(4,478	)		(0.08	)		(8,777	)		(0.15	)	$	(10,796	)		(0.19	)
Diluted weighted avg shares outstanding			53,064						56,721						53,461						58,610

Selective Insurance Group, Inc.
2008 Statutory Results by Line of Business
2nd Qtr 2008 (unaudited)
($ in thousands)
	Net		Net				Underwriting	Dividends to	Combined	Combined
	Premiums	Percent	Premiums	Percent	Loss	LAE	Expense	Policyholders	Ratio	Ratio	Underwriting
	Written	Change	Earned	Change	Ratio	Ratio	Ratio	Ratio	2008	2007	Gain/(Loss)
Personal Lines:
Homeowners	$         18,500	7.0%	$        16,975	10.4%	48.7%	7.6%	34.8%	0.0%	91.1%	111.7%	$                988
Auto	35,345	3.7%	32,941	(0.5)%	66.3%	14.5%	29.3%	0.0%	110.1%	109.8%	$           (4,027)
Other (including flood)	2,346	12.5%	2,141	12.4%	52.9%	(29.4)%	(54.2)%	0.0%	(30.7)%	(17.9)%	2,909
Total	$         56,191	5.1%	$        52,057	3.3%	60.0%	10.4%	27.7%	0.0%	98.1%	105.5%	$              (130)
Commercial Lines:
Fire/IM	$         48,986	(0.9)%	$        48,575	3.8%	52.1%	4.8%	37.6%	(0.1)%	94.4%	94.0%	$            2,582
Workers compensation	78,753	(12.7)%	77,501	(4.2)%	60.8%	10.5%	25.2%	2.1%	98.6%	102.2%	762
General liability	105,042	(4.8)%	99,932	(1.6)%	51.5%	18.6%	33.1%	0.1%	103.3%	100.1%	(4,982)
Auto	78,483	(5.2)%	77,758	(1.3)%	58.0%	8.2%	30.1%	(0.1)%	96.2%	84.1%	2,702
BOP	14,499	7.8%	14,384	10.4%	63.2%	12.7%	37.6%	0.0%	113.5%	116.5%	(1,984)
Bonds	4,987	3.4%	4,718	0.8%	12.8%	3.5%	61.5%	0.0%	77.8%	86.4%	882
Other	2,453	10.6%	2,329	15.7%	1.2%	0.1%	42.5%	0.0%	43.8%	31.9%	1,256
Total	$       333,203	(5.7)%	$       325,198	(0.8)%	55.0%	11.5%	31.8%	0.5%	98.8%	95.9%	$            1,217
Grand Total	$       389,394	(4.3)%	$       377,255	(0.3)%	55.6%	11.3%	31.4%	0.4%	98.7%	97.1%	$            1,087

Note: Some amounts may not foot due to rounding.
		2008	2007
	Losses Paid	$    184,579	$            170,007
	LAE Paid	36,010	32,463
	Total Paid	$    220,589	$            202,470

Selective Insurance Group, Inc.
2008 Statutory Results by Line of Business
June 2008 YTD (unaudited)
($ in thousands)
	Net		Net				Underwriting	Dividends to	Combined	Combined
	Premiums	Percent	Premiums	Percent	Loss	LAE	Expense	Policyholders	Ratio	Ratio	Underwriting
	Written	Change	Earned	Change	Ratio	Ratio	Ratio	Ratio	2008	2007	Gain/(Loss)
Personal Lines:
Homeowners	$         32,608	8.4%	$        33,546	9.9%	55.8%	8.0%	37.1%	0.0%	100.9%	116.6%	$                  30
Auto	68,920	3.8%	65,547	(2.2)%	66.8%	14.7%	30.2%	0.0%	111.7%	105.7%	$           (8,700)
Other (including flood)	4,417	13.0%	4,260	11.3%	51.7%	(12.9)%	(53.7)%	0.0%	(14.9)%	22.0%	4,980
Total	$       105,945	5.5%	$       103,353	1.9%	62.6%	11.4%	28.8%	0.0%	102.8%	105.7%	$           (3,690)
Commercial Lines:
Fire/IM	$         97,230	(3.3)%	$        98,511	5.5%	51.7%	4.6%	38.9%	0.3%	95.5%	93.1%	$            4,940
Workers compensation	159,053	(13.5)%	155,968	(4.5)%	58.6%	11.0%	25.6%	1.3%	96.5%	100.2%	4,609
General liability	216,325	(5.6)%	203,201	(0.9)%	49.9%	17.4%	33.0%	(0.1)%	100.2%	97.5%	(4,646)
Auto	158,682	(6.9)%	156,982	(0.4)%	59.7%	8.1%	30.4%	0.0%	98.2%	86.1%	2,295
BOP	29,684	9.0%	28,525	10.2%	57.9%	12.7%	38.8%	0.0%	109.4%	118.0%	(3,124)
Bonds	9,519	(0.4)%	9,493	1.1%	12.2%	4.4%	62.8%	0.0%	79.4%	82.4%	1,938
Other	4,910	8.5%	4,608	18.9%	1.8%	0.2%	43.8%	0.0%	45.8%	34.7%	2,362
Total	$       675,403	(6.9)%	$       657,288	(0.2)%	54.1%	11.2%	32.2%	0.3%	97.8%	94.9%	$            8,374
Grand Total	$       781,348	(5.4)%	$       760,641	0.1%	55.2%	11.2%	31.8%	0.3%	98.5%	96.4%	$            4,684
Note: Some amounts may not foot due to rounding.
		2008	2007
	Losses Paid	$    373,419	$            320,562
	LAE Paid	70,471	64,666
	Total Paid	$    443,890	$            385,228

Selective Insurance Group, Inc.
Diversified Insurance Services
( $ in thousands)
Three Months Ended June 30, 2008 (unaudited)
		Revenue			Net Income			Return on Revenue
		2008	2007	% Change	2008	2007	% Change	2008	2007	Pt Change
Flood		14,013	13,656	3%	1,939	2,447	-21%	13.8%	17.9%	(4.1)
Human Resource Administration Outsourcing		13,498	14,928	-10%	607	944	-36%	4.5%	6.3%	(1.8)
Other		2,553	2,093	22%	724	628	15%	28.4%	30.0%	(1.6)
Total		30,064	30,677	-2%	3,270	4,019	-19%	10.9%	13.1%	(2.2)
Six Months Ended June 30, 2008 (unaudited)
		Revenue			Net Income			Return on Revenue
		2008	2007	% Change	2008	2007	% Change	2008	2007	Pt Change
Flood		26,110	24,066	8%	3,277	3,749	-13%	12.6%	15.6%	(3.0)
Human Resource Administration Outsourcing		28,616	31,723	-10%	1,114	1,829	-39%	3.9%	5.8%	(1.9)
Other		5,137	4,066	26%	1,692	1,345	26%	32.9%	33.1%	(0.2)
Total		59,863	59,855	0%	6,083	6,923	-12%	10.2%	11.6%	(1.4)
Human Resource Administration Outsourcing Statistics (unaudited)
		2008	2007	% Change
New Worksite EE - Selective Agents (Production)		1,098	1,363	-19%
Total New Worksite EE - All Agents (Production)		1,319	1,871	-30%
Total Worksite EE		24,660	27,215	-9%
Annual Gross Billings (000's)	$	975,684	998,576	-2%
Annual Gross Billings / Avg Worksite EE	$	38,629	37,745	2%

Selective Insurance Group, Inc. and Consolidated Subsidiaries

 Quarterly

GAAP Investment Income

($ in thousands)

(Unaudited)

		For the three months ended						%			Year to Date						%
		June			June			Increase			June			June			Increase
		2008			2007			(Decrease)			2008			2007			(Decrease)
Investment Income:
	Interest:
	Fixed Maturity Securities	$	36,424			34,258			6.3			72,830			68,846			5.8
	Short-term		1,290			1,312			(1.7	)		2,727			3,790			(28.0	)
	Other Investments		344			4,151			(91.7	)		2,177			6,511			(66.6	)
	Dividends		1,520			2,186			(30.5	)		2,679			3,656			(26.7	)
	Change in Fair Value(1)		257			-			N/M			(1,631	)		-			N/M
	Miscellaneous		49			43			14.0			123			117			5.1
			39,884			41,950			(4.9	)		78,905			82,920			(4.8	)
Investment Expense			1,369			1,308			4.7			2,524			2,415			4.5
Net Investment Income Before Tax			38,515			40,642			(5.2	)		76,381			80,505			(5.1	)
Tax			8,433			8,854			(4.8	)		16,928			17,560			(3.6	)
Net Investment Income After Tax		$	30,082			31,788			(5.4	)		59,453			62,945			(5.5	)
Net Investment Income per Share			0.57			0.56			1.8			1.11			1.07			3.7
Effective Tax Rate			21.9%			21.8%						22.2%			21.8%
Average Yields:
Fixed Maturity Securities
	Pre Tax											4.6%			4.6%
	After Tax											3.6%			3.6%
Portfolio
	Pre Tax											4.1%			4.5%
	After Tax											3.2%			3.5%
		For the three months ended									Year to Date
		June			June						June			June
Net Realized Gains (Losses)		2008			2007						2008			2007
	Fixed Maturities		(12,619	)		(565	)					(13,230	)		(654	)
	Equity Securities		14,542			13,713						16,668			25,045
	Total		1,923			13,148						3,438			24,391
	Net of Tax		1,250			8,546						2,235			15,854

(1)   Selective adopted Fas 159, the Fair Value Option for Financial Assets and Financial Liablilities - Including an amendment of FASB Statement No. 115,on January 1, 2008 and has made the fair value option election as it relates to a portfolio of equity securities (trading securities) currently being managed by one outside manager.

SELECTIVE INSURANCE GROUP, INC.		Unaudited
CONSOLIDATED BALANCE SHEETS		June 30,	December 31,
($ in thousands, except share amounts)		2008	2007
ASSETS
Investments:
Fixed maturity securities, held-to-maturity –at amortized cost
(fair value of:  $4,071 – 2008; $5,927 – 2007)	$	3,979	5,783
Fixed maturity securities, available-for-sale – at fair value
(amortized cost of:  $3,081,830 – 2008; $3,049,913 – 2007)		3,044,378	3,073,547
Equity securities, available-for-sale – at fair value
(cost of:  $143,084 – 2008; $160,390 – 2007)		212,838	274,705
Short-term investments – at cost which approximates fair value		218,074	190,167
Equity securities, trading – at fair value (cost of: $17,982 – 2008)		23,196	-
Other investments		206,410	188,827
Total investments		3,708,875	3,733,029
Cash and cash equivalents		16,402	8,383
Interest and dividends due or accrued		34,992	36,141
Premiums receivable, net of allowance for uncollectible
accounts of:  $4,157 – 2008; $3,905 – 2007		524,680	496,363
Other trade receivables, net of allowance for uncollectible
accounts of:  $226 – 2008; $244 – 2007		23,602	21,875
Reinsurance recoverable on paid losses and loss expenses		5,729	7,429
Reinsurance recoverable on unpaid losses and loss expenses		248,011	227,801
Prepaid reinsurance premiums		88,978	82,182
Current federal income tax		1,140	4,235
Deferred federal income tax		68,193	22,375
Property and equipment – at cost, net of accumulated
depreciation and amortization of:  $125,465 – 2008; $117,832 – 2007		54,668	58,561
Deferred policy acquisition costs		225,645	226,434
Goodwill		33,637	33,637
Other assets		44,623	43,547
Total assets	$	5,079,175	5,001,992
LIABILITIES AND STOCKHOLDERS’ EQUITY
Liabilities:
Reserve for losses	$	2,262,310	2,182,572
Reserve for loss expenses		375,451	359,975
Unearned premiums		868,851	841,348
Senior convertible notes		-	8,740
Notes payable		273,865	286,151
Commissions payable		44,987	60,178
Accrued salaries and benefits		84,166	88,079
Other liabilities		151,833	98,906
Total liabilities		4,061,463	3,925,949
Stockholders' Equity:
Preferred stock of $0 par value per share: Authorized shares:  5,000,000; no shares issued or outstanding
Common stock of $2 par value per share:
Authorized shares:  360,000,000
Issued:  94,986,691 – 2008; 94,652,930 – 2007		189,973	189,306
Additional paid-in capital		208,067	192,627
Retained earnings		1,147,287	1,105,946
Accumulated other comprehensive income		15,270	86,043
Treasury stock – at cost (shares: 42,306,878 – 2008; 40,347,894 – 2007)		(542,885)	(497,879)
Total stockholders' equity		1,017,712	1,076,043
Commitments and contingencies
Total liabilities and stockholders' equity	$	5,079,175	5,001,992

SELECTIVE INSURANCE GROUP, INC.

UNAUDITED CONSOLIDATED STATEMENTS OF INCOME	Quarter ended	Six Months ended
	June 30,	June 30,

(in thousands, except per share amounts)		2008	2007		2008	2007
Revenues:
	$	387,229	404,923	$	777,069	822,108
Net increase in unearned premiums and prepaid reinsurance premiums		(12,140)	(28,572)		(20,707))	(65,744)
Net premiums earned		375,089	376,351		756,362	756,364
Net investment income earned		38,515	40,642		76,381	80,505
Net realized gains		1,923	13,148		3,438	24,391
Diversified Insurance Services revenue		30,064	30,677		59,863	59,855
Other income		1,761	1,220		2,421	3,032
Total revenues		447,352	462,038		898,465	924,147
Expenses:
Losses incurred		209,915	208,621		420,045	411,931
Loss expenses incurred		43,736	42,615		86,785	85,598
Policy acquisition costs		124,124	124,701		252,804	247,619
Dividends to policyholders		1,579	1,022		2,114	2,509
Interest expense		5,127	5,992		10,436	12,323
Diversified Insurance Services expenses		25,125	24,608		50,639	49,419
Other expenses		1,661	6,693		12,955	17,763
Total expenses		411,267	414,252		835,778	827,162
Income before federal income tax		36,085	47,786		62,687	96,985
Federal income tax expense (benefit):
Current		12,883	14,726		24,018	30,337
Deferred		(5,449)	(2,826)		(10,485) )	(6,490)
Total federal income tax expense		7,434	11,900		13,533	23,847
Net income	$	28,651	35,886		49,154	73,138
Earnings per share:
Basic net income	$	0.55	0.69		0.94	1.38
Diluted net income	$	0.54	0.64		0.92	1.26
Dividends to stockholders	$	0.13	0.12		0.26	0.24

SELECTIVE INSURANCE GROUP, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF
STOCKHOLDERS’ EQUITY
		Six Months Ended June 30,
($ in thousands, except per share amounts)		2008		2007
Common stock:
Beginning of year	$	189,306		183,124
Dividend reinvestment plan
(shares:  40,645 – 2008; 36,097 – 2007)		81		72
Convertible debentures
(shares:  45,759 – 2008; 848,604 – 2007)		92		1,697
Stock purchase and compensation plans
(shares:  247,357 – 2008; 702,919 – 2007)		494		1,407
End of period		189,973		186,300
Additional paid-in capital:
Beginning of year		192,627		153,246
Dividend reinvestment plan		847		859
Convertible debentures		645		9,831
Stock purchase and compensation plans		13,948		16,857
End of period		208,067		180,793
Retained earnings:
Beginning of year		1,105,946		986,017
Cumulative-effect adjustment due to adoption of FAS 159
net of deferred income tax effect of $3,344		6,210		-
Net income		49,154	49,154	73,138	73,138
Cash dividends to stockholders ($0.26 share – 2008;
$0.24 per share – 2007)		(14,023)		(13,216)
End of period		1,147,287		1,045,939
Accumulated other comprehensive income:
Beginning of year		86,043		100,601
Cumulative-effect adjustment due to adoption of FAS 159,
net of deferred income tax effect of $(3,344)		(6,210)		-
Other comprehensive (loss) income, (decrease) increase in:
Net unrealized gains on investment securities, net of deferred
income tax effect of:  $(34,803) – 2008; $(14,592) – 2007		(64,633)	(64,633)	(27,099)	(27,099)
Defined benefit pension plans, net of deferred income tax effect
of:  $38 – 2008; $101 – 2007		70	70	186	186
End of period		15,270		73,688
Comprehensive (loss) income			(15,409)		46,225
Treasury stock:
Beginning of year		(497,879)		(345,761)
Acquisition of treasury stock
(shares:  1,958,984 – 2008; 5,386,005 – 2007)		(45,006)		(137,592)
End of period		(542,885)		(483,353)
Total stockholders’ equity	$	1,017,712		1,003,367

SELECTIVE INSURANCE GROUP, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOW	Six Months ended
	June 30,
($ in thousands)	2008	2007

Operating Activities
Net income	$	49,154	73,138
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		14,197	14,302
Share-based compensation expense		9,137	13,703
Net realized gains		(3,438)	(24,391)
Deferred tax		(10,485)	(6,490)
Unrealized loss on trading securities		1,631	-
Changes in assets and liabilities:
Increase in reserves for losses and loss expenses, net of reinsurance recoverable
on unpaid losses and loss expenses		75,033	109,858
Increase in unearned premiums, net of prepaid reinsurance and advance premiums		20,350	66,234
Decrease (increase) in net federal income tax recoverable		3,095	(3,840)
Increase in premiums receivable		(28,317)	(89,014)
(Increase) decrease in other trade receivables		(1,727)	608
Decrease (increase) in deferred policy acquisition costs		789	(12,229)
Decrease in interest and dividends due or accrued		1,212	696
Decrease in reinsurance recoverable on paid losses and loss expenses		1,700	59
Decrease in accrued salaries and benefits		(4,301)	(14,967)
Decrease in accrued insurance expenses		(20,756)	(8,588)
Purchase of trading securities		(5,813)	-
Sale of trading securities		6,100	-
Other-net		8,526	5,063
Net adjustments		66,933	51,004
Net cash provided by operating activities		116,087	124,142
Investing Activities
Purchase of fixed maturity securities, available-for-sale		(239,887)	(231,392)
Purchase of equity securities, available-for-sale		(16,095)	(54,214)
Purchase of other investments		(25,976)	(33,580)
Purchase of short-term investments		(1,061,242)	(861,197)
Sale of fixed maturity securities, available-for-sale		80,056	51,717
Sale of short-term investments		1,033,334	922,902
Redemption and maturities of fixed maturity securities, held-to-maturity		1,818	628
Redemption and maturities of fixed maturity securities, available-for-sale		158,685	176,295
Sale of equity securities, available-for-sale		34,585	60,321
Proceeds from other investments		3,798	8,558
Purchase of property and equipment		(3,851)	(6,365)
Net cash (used in) provided by investing activities		(34,775)	33,673
Financing Activities
Dividends to stockholders		(13,009)	(12,023)
Acquisition of treasury stock		(45,006)	(137,592)
Principal payment of notes payable		(12,300)	(18,300)
Net proceeds from stock purchase and compensation plans		4,457	4,560
Excess tax benefits from share-based payment arrangements		1,319	2,656
Principal payments of convertible bonds		(8,754)	-
Net cash used in financing activities		(73,293)	(160,699)
Net increase (decrease) in cash and cash equivalents		8,019	(2,884)
Cash and cash equivalents, beginning of year		8,383	6,443
Cash and cash equivalents, end of period	$	16,402	3,559

Supplemental Disclosures of Cash Flows Information

Cash paid during the period for:
Interest	$	10,643	12,573
Federal income tax		19,600	32,000
Supplemental schedule of non-cash financing activity:
Conversion of convertible debentures		169	11,055

Selective Insurance Group, Inc.
Combined Insurance Company Subsidiaries
Unaudited Statutory Balance Sheets
($ in thousands)
		Jun-30		Jun-30		Dec-31
		2008		2007		2007
ASSETS
Bonds	$	3,083,417		2,913,393		3,041,373
Common stocks		258,064		343,676		297,102
Other investments		206,560		175,605		188,827
Short-term investments		181,852		96,245		125,650
Total investments		3,729,893		3,528,919		3,652,952
Cash on hand and in banks		(45,075	)	(31,428	)	(33,209	)
Interest and dividends due and accrued		34,986		34,093		36,057
Premiums receivable		521,029		542,815		491,308
Reinsurance recoverable on paid losses and expenses		(7,601)		4,942		7,429
Deferred tax recoverable		88,227		90,964		87,951
EDP equipment		4,042		3,534		4,691
Equities and deposits in pools and associations		11,661		9,551		10,411
Receivable for sold securities		848		569		167
Other assets		30,359		29,647		32,105
Total assets	$	4,368,369		4,213,606		4,289,862
LIABILITIES
Reserve for losses	$	2,000,592		1,850,635		1,953,960
Reinsurance payable on paid loss and loss expense		1,353		638		1,310
Reserve for loss expenses		373,173		343,921		358,126
Unearned premiums		779,873		787,347		759,166
Reserve for commissions payable		44,987		49,533		60,178
Ceded balances payable		5,992		8,531		8,192
Federal income tax payable		24,432		18,025		14,084
Premium and other taxes payable		19,417		20,669		24,982
Reserve for dividends to policyholders		5,112		4,327		5,651
Reserves for unauthorized/overdue reinsurance		1,258		1,570		1,258
Payable for securities		50,951		12,572		-
Funds withheld on account of others		4,854		5,831		5,070
Accrued salaries and benefits		42,943		37,020		48,582
Other liabilities		13,756		13,048		15,009
Total liabilities		3,368,693		3,153,667		3,255,568
POLICYHOLDERS' SURPLUS
Capital		28,325		28,325		28,325
Paid in surplus		235,792		235,792		235,792
Unassigned surplus		735,559		795,822		770,177
Total policyholders' surplus		999,676		1,059,939		1,034,294
Total liabilities and policyholders' surplus	$	4,368,369		4,213,606		4,289,862

Selective Insurance Group, Inc.

 Combined Insurance Company Subsidiaries

Unaudited Statutory Statements Of Income

($ in thousands)

	Three Months Ended									Six Months Ended
				June									June
UNDERWRITING	2008					2007				2008					2007
Net premiums written	$	389,395					406,760				781,348					825,672
Net premiums earned		377,254					378,207				760,641					759,924
Net losses paid		184,579					170,007				373,419					320,562
Change in reserve for losses		25,348					38,701				46,632					91,484
Net losses incurred		209,927			55.6%		208,708		55.2%		420,051			55.2%		412,046		54.2%
Net loss expenses paid		36,010					32,463				70,471					64,666
Change in reserve for loss expenses		6,768					8,505				15,047					19,060
Net loss expenses incurred		42,778			11.3%		40,968		10.8%		85,518			11.2%		83,726		11.0%
Net underwriting expenses incurred		122,768			31.6%		125,908		30.9%		249,254			31.9%		255,821		31.1%
Total deductions		375,473					375,584				754,823					751,593
Statutory gain		1,781					2,623				5,818					8,331
Net loss from premium balances charged off		(833	)				(814	)			(1,486	)				(1,462	)
Finance charges and other income		1,775					1,228				2,466					3,003
Total other income		942			-0.2%		414		-0.1%		980			-0.1%		1,541		-0.2%
Policyholders' dividends incurred		(1,579	)		0.4%		(1,021	)	0.3%		(2,114	)		0.3%		(2,508	)	0.3%
Total underwriting gain		1,144			98.7%		2,016		97.1%		4,684			98.5%		7,364		96.4%
INVESTMENT
Net investment income earned		37,992					38,015				78,240					74,749
Net realized gain		2,827					13,148				6,147					24,391
Total income before income tax		41,963					53,179				89,071					106,504
Federal income tax expense		15,254					16,684				29,948					36,077
Net income	$	26,709					36,495				59,123					70,427
Policyholders' Surplus
Surplus, beginning of period	$	1,016,282					1,040,675				1,034,294					1,030,078
Net income		26,709					36,495				59,123					70,427
Change in deferred tax		5,842					4,537				7,253					10,583
Change in unrealized (losses) gains		(10,887	)				3,240				(29,002	)				(310	)
Dividends to stockholders		(28,003	)				(30,004	)			(52,543	)				(50,009	)
Change in non-admitted assets		(10,253	)				(1,874	)			(19,340	)				(7,686	)
Surplus adjustments		(14	)				6,870				(109	)				6,856
Net change in surplus for period		(16,606	)				19,264				(34,618	)				29,861
Surplus, end of period	$	999,676					1,059,939				999,676					1,059,939

Statutory underwriting gain	$	1,144		2,016		4,684		7,364
Adjustments under GAAP:
Deferred policy acquisition costs		87		3,573		(789	)	12,229
Flood income reclassification		(2,989	)	(3,772	)	(5,055	)	(5,780	)
Other, net		(1,493	)	(1,962	)	(3,543	)	(4,241	)
GAAP underwriting (loss) gain	$	(3,251	)	(145	)	(4,703	)	9,572

Note: Some amounts or ratios may not foot due to rounding.

Certain amounts have been reclassified to conform to the current year's presentation.

Selective Insurance Group, Inc. and Consolidated Subsidiaries
Municipal Fixed Income Portfolio as of June 30, 2008
($ in millions)
(unaudited)
	Average	Market	% of Total	Unrealized
	Credit Rating	Value	Muni Portfolio	Gain
Uninsured Securities	AA+	886	52%	151
Securities with Insurance Enhanced1	AA+	832	48%	(125)
Without Insurance Enhancement	AA-
Total		$     1,718	100%	$           26
1 Includes $16.4 million of unrated municipal fixed income securities which we consider to be investment grade.
A "BBB-" rating has been applied to these municipal fixed income securities in the interest of conservatism.
Note: Some amounts may not foot due to rounding.

Selective Insurance Group, Inc. and Consolidated Subsidiaries

Ratings on Municipal Fixed Income Portfolio

as of June 30, 2008 ($ in millions)

(unaudited)

							Total Municipal  Fixed Income		Total Municipal  Fixed Income
			Insurance		Underlying Rating of		Portfolio		Portfolio
	Uninsured		Enhanced		Insurance Enhanced		(with Insurance		(without Insurance
	Securities		Securities1		Securities1		Enhancement)		Enhancement)
	(1)		(2)		(3)		(1) + (2)		(1) + (3)
S&P or equivalent ratings	Market Value	% of Total	Market Value	% of Total	Market Value	% of Total	Market Value	% of Total	Market Value	% of Total
AAA	426	48%	288	35%	56	7%	715	42%	482	28%
AA+	162	18%	39	5%	97	12%	201	12%	259	15%
AA	165	19%	354	43%	156	19%	519	30%	321	19%
AA-	75	8%	88	11%	243	29%	162	9%	318	19%
A+	21	2%	31	4%	109	13%	52	3%	130	8%
A	8	1%	20	2%	82	10%	28	2%	90	5%
A-	18	2%	9	1%	53	6%	27	2%	70	4%
BBB+	4	0%	-	0%	14	2%	4	0%	18	1%
BBB	8	1%	-	0%	-	0%	8	0%	8	0%
BBB-	-	0%	3	0%	21	3%	3	0%	21	1%
BB+	1	0%	-	0%	-	0%	1	0%	1	0%
Total	886	100%	832	100%	832	100%	1,718	100%	1,718	100%
Average Rating:		AA+		AA+		AA-		AA+		AA
Unrealized Gain:	151		(125)				26

1 Includes $16.4 million of unrated municipal fixed income securities which we consider to be investment grade.

  A "BBB-" rating has been applied to these municipal fixed income securities in the interest of conservatism.

Note: Some amounts may not foot due to rounding.

Selective Insurance Group, Inc. and Consolidated Subsidiaries
Municipal Bonds with Credit Enhancement
June 30, 2008
($ in thousands)
(unaudited)
Credit Enhancement	Underlying Composite Rating	Market Value	Book Value	Unrealized
AMBAC	AAA	16,819	16,718	101
(Ratings:	AA+	10,980	10,886	93
Moody's = Aa3	AA	29,705	29,885	(181)
S&P = AA	AA-	14,961	15,050	(89)
Fitch = WD)	A+	7,971	8,209	(239)
	A	28,687	29,206	(518)
	A-	9,116	9,142	(26)
	BBB+	3,257	3,258	(2)
	NR	5,767	5,790	(23)
AMBAC Total		127,263	128,145	(882)
FGIC	AAA	12,074	11,961	113
(Ratings:	AA+	12,054	11,997	56
Moody's = B1	AA	28,534	28,233	301
S&P = BB	AA-	60,096	60,719	(623)
Fitch = BBB)	A+	25,289	25,742	(453)
	A	8,759	8,771	(12)
	A-	8,724	8,732	(8)
	BBB-	2,821	2,891	(70)
	NR	516	520	(5)
FGIC Total		158,866	159,566	(699)
FSA	AAA	25,845	25,838	7
(Ratings:	AA+	51,816	51,696	120
Moody's =Aaa	AA	43,187	43,095	91
S&P = AAA	AA-	67,482	66,417	1,065
Fitch = AAA)	A+	26,283	26,177	106
	A	15,857	15,801	56
	A-	15,666	15,593	73
	NR	1,751	1,785	(34)
FSA Total		247,887	246,402	1,484
MBIA	AAA	1,286	1,272	14
(Ratings:	AA+	21,895	22,008	(112)
Moody's = A2	AA	54,856	54,734	122
S&P = AA	AA-	100,785	100,239	545
Fitch = WD)	A+	45,906	45,591	315
	A	28,909	29,209	(300)
	A-	19,137	19,334	(197)
	BBB-	2,020	2,134	(114)
	BBB+	10,764	10,710	54
	NR	7,077	7,219	(142)
MBIA Total		292,636	292,451	185
RADIAN Ratings: Moody's = A3 S&P = A Fitch = WD)	NR	1,271	1,266	5
RADIAN Total		1,271	1,266	5
XLCA (Ratings: Moody's = B2 S&P = BBB- Fitch = BB)	A+	3,663	3,880	(217)
XLCA Total		3,663	3,880	(217)
Grand Total		831,586	831,710	(125)
Muni's with Insurance as a % of total Munis>>>		48%
Note: Some amounts may not foot due to rounding.

Selective Insurance Group, Inc. and Consolidated Subsidiaries

Residential Mortgage Backed Securities (RMBS) and Residential Asset Backed Securities (RABS)- by Vintage Year

June 30, 2008

($ in thousands)

(unaudited)

Book Value

							% of Total
						Type %	Bond
Vintage Yr	AAA	AA	A	BBB	Total	of Total	Portfolio
1983	21	-	-	-	21	0%	0%
2002	73,320	3,060	-	-	76,380	17%	2%
2003	66,459	-	2,818	-	69,277	16%	2%
2004	44,231	-	-	-	44,231	10%	1%
2005	71,941	-	-	-	71,941	16%	2%
2006	137,001	-	5,412	-	142,413	32%	5%
2007	11,967	13,718	1,366	1,294	28,345	6%	1%
2008	9,183	-	-	-	9,183	2%	0%
Total RMBS & RABS-Book Value	414,123	16,778	9,597	1,294	441,791	100%	14%
% of Total RMBS & RABS	94%	4%	2%	0%	100%
Market Value
							% of Total
						Type %	Bond
Vintage Yr	AAA	AA	A	BBB	Total	of Total	Portfolio
1983	22	-	-	-	22	0%	0%
2002	74,676	3,060	-	-	77,736	18%	3%
2003	66,419	-	2,294	-	68,713	16%	2%
2004	43,535	-	-	-	43,535	10%	1%
2005	66,677	-	-	-	66,677	16%	2%
2006	125,802	-	5,412	-	131,214	31%	4%
2007	12,163	10,008	880	784	23,835	6%	1%
2008	9,161	-	-	-	9,161	2%	0%
Total RMBS & RABS-Market Value	398,455	13,069	8,586	784	420,893	100%	14%
% of Total RMBS & RABS	95%	3%	2%	0%	100%
Weighted Average Market Price	96.2	77.9	89.5	60.6	95.3

Unrealized Gain/(Loss)
Vintage Yr	AAA	AA	A	BBB	Total
1983	1	-	-	-	1
2002	1,356	-	-	-	1,357
2003	(40)	-	(524)	-	(565)
2004	(696)	-	-	-	(696)
2005	(5,264)	-	-	-	(5,264)
2006	(11,199)	-	-	-	(11,199)
2007	197	(3,710)	(486)	(510)	(4,510)
2008	��        (23)	-	-	-	(23)
Total RMBS & RABS - Unrealized	(15,668)	(3,709)	(1,011)	(510)	(20,898)
% of Total RMBS & RABS	75%	18%	5%	2%	100%
Note: Some amounts may not foot due to rounding.

Selective Insurance Group, Inc. and Consolidated Subsidiaries

Residential Mortgage Backed Securities (RMBS) and Residential Asset Backed Securities (RABS)- by Type

June 30, 2008

($ in thousands)

(unaudited)

Book Value

						% of Total
						Bond
RMBS Type	AAA	AA	A	BBB	Total	Portfolio
Agency	223,463	-	-	-	223,463	7%
FHA/VA	14,271	-	-	-	14,271	0%
Total Agency	237,735	-	-	-	237,735	8%
Alt-A	81,309	-	-	-	81,309	3%
Alt-A CDO	-	-	5,412	-	5,412	0%
Home Equity ABS	-	2,726	-	-	2,726	0%
Non-Agency & Other Prime	95,079	14,052	4,184	1,294	114,609	4%
Total RMBS & RABS-Book Value	414,123	16,778	9,597	1,294	441,791	14%

% of Total RMBS & RABS	94%	4%	2%	0%	100%
Market Value

						% of Total
						Bond
RMBS Type	AAA	AA	A	BBB	Total	Portfolio
Agency	226,236	-	-	-	226,236	7%
FHA/VA	13,755	-	-	-	13,755	0%
Total Agency	239,992	-	-	-	239,992	8%
Alt-A	68,850	-	-	-	68,850	2%
Alt-A CDO	-	-	5,412	-	5,412	0%
Home Equity ABS	-	2,726	-	-	2,726	0%
Non-Agency & Other Prime	89,614	10,342	3,174	784	103,913	3%
Total RMBS & RABS-Market Value	398,455	13,069	8,586	784	420,893	14%

% of Total RMBS & RABS	95%	3%	2%	0%	100%
Weighted Average Market Price	96.2	77.9	89.5	60.6	95.3
Unrealized Gains/(Losses)
RMBS Type	AAA	AA	A	BBB	Total
Agency	2,773	-	-	-	2,773
FHA/VA	(516)	-	-	-	(516)
Total Agency	2,257	-	-	-	2,257
Alt-A	(12,460)	-	-	-	(12,460)
Alt-A CDO	-	-	-	-	-
Home Equity ABS	-	-	-	-	-
Non-Agency & Other Prime	(5,465)	(3,709)	(1,011)	(510)	(10,695)
Total RMBS & RABS - Unrealized	(15,668)	(3,709)	(1,011)	(510)	(20,898)
% of Total RMBS & RABS	75%	18%	5%	2%	100%
Note: Some amounts may not foot due to rounding.

Selective Insurance Group, Inc. and Consolidated Subsidiaries

Commercial Mortgage Backed Securities (CMBS) - by Vintage Year

June 30, 2008

($ thousands)

(unaudited)

 Book Value

								% of Total
							Type %	Bond
Vintage Yr	AAA	AA	A	BBB	BB	Total	of Total	Portfolio
1996	5,256	-	-	-	-	5,256	2%	0%
1999	26,524	-	-	-	-	26,524	9%	1%
2000	33,979	-	-	-	-	33,979	12%	1%
2001	36,311	-	-	-	-	36,311	12%	1%
2002	49,425	-	-	-	-	49,425	17%	2%
2003	2,005	-	-	-	-	2,005	1%	0%
2004	9,500	5,000	-	-	-	14,500	5%	0%
2005	11,060	4,845	-	4,798	-	20,702	7%	1%
2006	26,526	10,390	3,000	-	-	39,916	14%	1%
2007	38,872	6,823	2,000	10,687	5,000	63,382	22%	2%
Total CMBS-Book Value	239,458	27,058	5,000	15,484	5,000	292,001	100%	10%
% of Total CMBS	82%	9%	2%	5%	2%	100%

 Market Value

								% of Total
							Type %	Bond
Vintage Yr	AAA	AA	A	BBB	BB	Total	of Total	Portfolio
1996	5,163	-	-	-	-	5,163	2%	0%
1999	27,070	-	-	-	-	27,070	10%	1%
2000	34,953	-	-	-	-	34,953	13%	1%
2001	37,208	��                        -	-	-	-	37,208	14%	1%
2002	49,797	-	-	-	-	49,797	18%	2%
2003	1,967	-	-	-	-	1,967	1%	0%
2004	9,405	4,841	-	-	-	14,246	5%	0%
2005	8,062	4,727	-	3,353	-	16,142	6%	1%
2006	21,614	8,120	2,796	-	-	32,529	12%	1%
2007	38,441	5,608	1,737	5,480	4,550	55,816	20%	2%
Total CMBS-Market Value	233,680	23,296	4,532	8,833	4,550	274,892	100%	9%
% of Total CMBS	85%	8%	2%	3%	2%	100%
Weighted Average Market Price	97.6	86.1	90.6	57.0	91.0	94.1

Unrealized Gain/(Loss)

Vintage Yr	AAA	AA	A	BBB	BB	Total
1996	(94)	-	-	-	-	(94)
1999	547	-	-	-	-	547
2000	974	-	-	-	-	974
2001	897	-	-	-	-	897
2002	372	-	-	-	-	372
2003	(38)	-	-	-	-	(38)
2004	(95)	(159)	-	-	-	(253)
2005	(2,998)	(118)	-	(1,444)	-	(4,560)
2006	(4,913)	(2,270)	(204)	-	-	(7,387)
2007	(431)	(1,215)	(263)	(5,206)	(450)	(7,566)
Total CMBS-Market Value	(5,779)	(3,762)	(468)	(6,651)	(450)	(17,109)
% of Total CMBS	34%	22%	3%	39%	3%	100%

Note: Some amounts may not foot due to rounding.

Selective Insurance Group, Inc. and Consolidated Subsidiaries

Commercial Mortgage Backed Securities (CMBS) - by Type

June 30, 2008

($ thousands)

(unaudited)

Book Value

								% of Total
							Type %	Bond
CMBS Type	AAA	AA	A	BBB	BB	Total	of total	Portfolio
Agency MultiFamily	58,133	-	-	-	-	58,133	20%	2%
Cell Tower	-	19,845	5,000	-	-	24,845	9%	1%
Conduit	27,896	-	-	-	-	27,896	10%	1%
Fusion (1)	115,910	3,823	-	13,484	-	133,217	46%	4%
Lease-Backed	4,873	-	-	-	-	4,873	2%	0%
Re-Securitization	24,586	3,390	-	-	-	27,977	10%	1%
Single Borrower - Multiple Properties	5,060	-	-	2,000	5,000	12,060	4%	0%
Timberland	3,000	-	-	-	-	3,000	1%	0%
Total CMBS-Book Value	239,458	27,058	5,000	15,484	5,000	292,001	100%	10%
% of Total CMBS	82%	9%	2%	5%	2%	100%

Market Value

								% of Total
							Type %	Bond
CMBS Type	AAA	AA	A	BBB	BB	Total	of Total	Portfolio
Agency MultiFamily	58,918	-	-	-	-	58,918	21%	2%
Cell Tower	-	18,921	4,532	-	-	23,453	9%	1%
Conduit	28,278	-	-	-	-	28,278	10%	1%
Fusion (1)	116,424	2,944	-	7,007	-	126,375	46%	4%
Lease-Backed	4,989	-	-	-	-	4,989	2%	0%
Re-Securitization	17,043	1,431	-	-	-	18,474	7%	1%
Single Borrower - Multiple Properties	5,192	-	-	1,826	4,550	11,568	4%	0%
Timberland	2,836	-	-	-	-	2,836	1%	0%
Total CMBS-Market Value	233,680	23,296	4,532	8,833	4,550	274,892	100%	9%
% of Total CMBS	85%	8%	2%	3%	2%	100%
Weighted Average Market Price	97.6	86.1	90.6	57.0	91.0	94.1
Unrealized Gains/(Losses)

CMBS Type	AAA	AA	A	BBB	BB	Total
Agency MultiFamily	785	-	-	-	-	��     785
Cell Tower	-	(924)	(468)	-	-	(1,392)
Conduit	382	-	-	-	-	382
Fusion (1)	514	(879)	-	(6,477)	-	(6,842)
Lease-Backed	116	-	-	-	-	116
Re-Securitization	(7,544)	(1,959)	-	-	-	(9,502)
Single Borrower - Multiple Properties	132	-	-	(174)	(450)	(491)
Timberland	(164)	-	-	-	-	(164)
Total CMBS-Market Value	(5,779)	(3,762)	(468)	(6,651)	(450)	(17,109)

(1)Fusion means a CMBS composed of large and small loans.

Note: Some amounts may not foot due to rounding.

Selective Insurance Group, Inc. and Consolidated Subsidiaries

Fixed Income Agency Exposure at 6/30/2008

($ in thousands)

(unaudited)

			Unrealized
	Book Value	Market Value	Gain/(Loss)
Agency MBS
Fannie Mae	61,038	61,949	911
Freddie Mac	98,506	100,547	2,041
Total Agency MBS*	159,544	162,496	2,952
Government Agency Debt
Fannie Mae	31,129	31,489	360
Freddie Mac	14,975	15,328	353
	46,104	46,817	713
Federal Farm Credit Bank	17,237	17,298	61
Federal Home Loan Bank	19,971	20,306	335
	37,208	37,604	396
Total Govt Agency Debt	83,312	84,421	1,109
Total Agency Exposure	242,856	246,917	4,061

* In addition, we have $122.1 million book value/$122.6 million market value of Ginnie Mae MBS which benefit from a direct government guarantee.

Note: Some amounts may not foot due to rounding.

Selective Insurance Group, Inc.

Available-for-Sale Fixed Maturity Securities

Severity and Duration of Unrealized Losses

June 30, 2008

(unaudited)

Fair Value as a percentage of Amortized Cost
		Unrealized	Fair
($ in millions)		(Loss) Gain	Value
85% but less than 100% of amortized cost	$	(32.3)	1,222.1
75% but less than 85% of amortized cost		(7.7)	34.3
Less than 75% of amortized cost		(28.7)	54.1
Gross unrealized losses on fixed maturity securities		(68.7)	1,310.5
Gross unrealized gains on fixed maturity securities		31.2	1,733.9
Net unrealized losses on fixed maturity securities	$	(37.5)	3,044.4

Duration of Unrealized Loss Position		75% but less	Less than
		than 85% of	75% of
		Amortized	Amortized
($ in millions)		Cost	Cost
0 – 3 months	$	(2.5)	(3.6)
4 – 6 months		(5.2)	(11.9)
7 – 9 months		-	(13.2)
Gross unrealized losses	$	(7.7)	(28.7)