SIGI - Earnings call 3 2023 | Selective Insurance Group, Inc.

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Operator

Good day, everyone. Welcome to Selective Insurance Group's Third Quarter 2023 Earnings Call. At this time, for opening remarks and introductions, I would like to turn the call over to Senior Vice President, Investor Relations and Treasurer, Brad Wilson.

Brad Wilson

Thanks, and good morning.

We are simulcasting this call on our website, selective.com, and a replay will be available until December 1. to results measures business X use discuss and our operations. We

reported use with annual, GAAP we in the financial filed First, reports measures our current quarterly SEC. and

divided Non-GAAP easier which we or GAAP Non-GAAP measures income common business. included losses return unrealized realized equity investments by unrealized average our the to is reconciliations operating to in and believe Second, common gains after-tax operating common available stockholders' income to value gains are after-tax measures, equity. non-GAAP on of is website. investor income supplemental our on on income. stockholders, non-GAAP make Adjusted losses in on book our any referenced investments use operating equity accumulated share it common package value or gains common operating for from share per net found and total other differs by insurance impact investors comprehensive evaluate net financial page securities. the excluding per we or on losses non-GAAP excluding of book Investors loss

about are make to Act future discuss obligation are and update current our annual, or reports we guarantees uncertainties any risks quarterly They We these no in of projections performance Litigation revise statements uncertainties. our Private and statements statement. and forward-looking XXXX. performance. These We Reform SEC. future of not subject under filed and risks detail the undertake to in with forward-looking Third, the and are Securities

our John. President, Financial John Now Mark and Chairman Executive of Vice I'll our the Chief Marchioni, Wilcox, President to follow Chief turn will call Board, Officer; Officer, over the Executive

John J. Marchioni

growth. quarter top joining delivered earnings Good strong morning, in line the We with third us. thank for and excellent you

bringing Our operating exceed. our annualized puts consistently non-GAAP ahead target us ROE XX.X%. of This meet ROE we XX% or XX%, to our year-to-date strive to was result operating

are our operating well meaningful year in operating performance. a XXth our a positioned ROE track XX%, we consecutive see Since is contribution a underwriting to solid of increase With average investment XXXX, quarter ROE income match to few and can ago, deliver in continue double-digit this We record. industry from our ROEs.

As rate achieved or loss cycles to pricing past exceeding have pure trends. renewal across we dozen over consistently equal we expected years, proved the

on level continues The forward time. and our stable enabled over a We are focused a going portfolio. at we our for new granular key tools manage sophisticated this to performance ensuring as by renewal underwrite ability reason and is underwriting strong

expected and social from and losses. the frequency uncertainty loss unusual the industry's frequency patterns have pressure renewal inflation, economic costs, We our elevated industry X.X% pricing. quarter in year-to-date severity continued the We of resulting price put factors versus loss have inflation, of of highlighted increases influenced pandemic Commercial X.X% These catastrophe trends coming X.X% standard trend pure necessitating into XXXX. on by achieved heightened and a on adequate focus the Lines of loss

this years. estimates casualty could frequency the the emerged Lower on see favorable taken. and will year fruition. trend Our offset pockets Within generally Mark Standard of frequency. XXXX our general have better actions Commercial have efforts higher the inflationary higher pressure representing believe impacts event but to estimates are and long-term a accident XX%. at achieve initial higher loss due in and If in target largely XX% auto has severity recent loss excess to running investment our maintaining We exists, severities holding we ratio our uncertainty an about come line. expected, Lines reflects liability. pricing embedding than is severity increased and loss some years, pure additional recent therefore, are This interest this income, meaningful has surplus up approximately personal to target picks renewal that or particularly industry-wide these most we rates business trends. elevated lines, in discuss as pressure and higher of consistent expected they elevated property been we reflect liability, with in we frequency accident and trends. this to consistent our moderates of have the Despite emerging to and in are providing commercial dynamic, expect the are weather price of trends, expected, tailwind combined

may These result, we addressing short profitability, clearly more increases. is increases remaining profitability basis need of The we and written Personal that are disrupting during challenges, of the our began business, effect on quarter address a to rate through As rate to avoid a aggressive actions draconian Lines Standard take agents. XX% file competitors XXXX. can which target some first customers our take to of

expect We X% XX% XX% of to renewal in written approximately be subject will quarter overall the regulatory to fourth our approvals. rate range the in and XXXX, in

refining severe same conditions. and pricing including both further our perils, As to cat performance storm. and homeowners' we changes, seeking terms we also are through At convective rate for non-cat are these improve file the time, we

rather We states severe we are storm, to older and replacement are deductibles. convective mandatory hail implementing value on exposed cash than costs most introducing actual wind in roofs. And

market to expect We hold other to coverage take the evolve. and these changes greater continues as

migration to profitability. to market, be continues for top the Finally, which accelerate to we actions Overall, target long-term of growth portfolio line are potential presents taking excellent. greater further our the

new distribution history. $X.X was our open in for our XX%. in to way In XXX-year the pure X% rate appreciate premiums quarter on annual retention. and XX% our net approach premiums business Our in increased managing $X exceeding and price and we first to and partners communication grew quarter billion total, value, are all our the billion, franchise to segments, renewal consistent the for Across time nearly

In grew segment, XXXX the to growth X.X% retention written policy Manageable Commercial our added of XX%. premiums New states with quarter. line. top count and in since the in as flagship approximately constructive be of continues marketplace by in growth quarter price pure evidenced growth contributed to our points business. to X.X% Standard of new Notably, strong premium the renewal Lines the also Lines XX% in net XX% a quarter X Commercial

the quarter, XX.X% auto, total continues increased resulting commercial up During X.X% diversify our renewal X.X%, a provide expand pure exposure our total In X.X% renewal to with renewal exposure premium pure of and XX.X% rate increasing increase. with us expansion in rate renewal up was to business and was runway XX.X%. Geographic portfolio. premium property

and new to generated approach deliberate in repeatable adding results. Our strong a process manifested has states

announce all-in We we standard plan the commercial and Oregon coming write and XXXX. are to expect Lines to Commercial excited in adding late to our Ultimately, Washington, in Virginia and are Maine West to launch we most States. footprint continued ratio months and or Nevada with growth in United well of continuous and an surplus the XX% quarter premium lines on XX.X% lines underlying XX.X% an very excellent Excess to the basis. of combined in perform

combined underlying review X was For XX.X% XX% with XX.X%. a ratio months, detail. our call in ratio and of more financial the premium growth I'll of Mark combined turn to performance to now the first over

Mark Wilcox

operating Year-to-date, the was non-GAAP you, $X.XX, We from up reported $X.XX, was of up and fully compared up John, good XX%. to diluted prior of a EPS XXX% third and Thank diluted $X.XX $X.XX morning. non-GAAP the EPS ago fully EPS, EPS quarter, year period, XX%. operating and XX% year in up

drove quarter, performance. our underwriting This net investment after-tax growth income significant in and margins stable

as net percentage a combined income investment Our ratio With we points XX.X%. for XX combined X.X healthy of income, ratio we of up year full is XX.X% margins. operating was quarter consolidated after-tax ratio.Despite net XX% the same higher year work XX%, we our our expected from ago our up generated combined XX.X% points Therefore, remain a when the investment achieve strong disciplined operating ROE, longer-term our reported ROE longer-term to target. driven will by above underwriting we

quarter's another X.X designated our cats frequency-driven year-to-date losses million. the to resulted $X $XX XX significant with catastrophe million was were with storm largest quarter on impacting events. was results, in points XX combined ultimate ratio. or quarter single third the bringing No net of event Catastrophe losses total the The

the from not X.X full catastrophe have of did casualty quarter points. losses any in increased points ratio reserve higher-than-expected last to the we result quarter, prior cat report year favorable in quarter. a guidance We X development the our net year loss As

favorable with development of $X reserve compensation auto offset unfavorable of and claims workers' was show our casualty by million development. $X While commercial This to in emergence line favorable million continue year prior auto. million $X personal in

casualty continuing practice As and each John our lines monitoring closely major lines of business full reserve emerging reviews are quarter to stay of we described, of for all abreast trends.

line loss auto Personal the accident in personal to $X.X increasing cost X.X ratio. million quarter, we on the relates or in our it As Lines the took year, combined points action current by

third We for also quarter commercial standing $X ratio increasing auto, million combined point X.X of lines. the added commercial in

year was ratio to underlying a were profitable points picks of quarter, ago, loss points XX.X a higher this these bit lower The the points than third lower expense expect losses Also better improvement. in ratio X a expected. lines points of for non-GAAP in XX.X% XX.X better X.X X.X the contributed combined year. a property continue points these quarter very of XXXX We than than and the

was right dollars Year-to-date, strong with same expense While continues in premium longer-term and to XX.X%, from year-to-date, line our quarter our below were on growth. benefit budget ratio fixed the target. basis period controllable the and our our XXXX expense ratio for XX points in expense

investments operating efficiencies ensuring expense we to we to our and Over the drive significant our term, continue while objectives. necessary to strategic support medium the make longer will continue and ratio manage

premiums insurance Regarding underlying XX% had of net combined I our would commercial in segments, XX.X% ratio lines, standing which a combined underwriting ratio the XX.X% strong performance and and growth. written highlight

ratio quarter and of Our with written excellent XX.X% net also premiums and an ratio XX%. of combined growth E&S segment underlying had combined XX.X%

of the year higher-than-expected quarter auto. development prior losses, continued property non-cap and adverse pressure year accident losses, another had on FirstLine catastrophe personal modest current in elevated

discussed, continue The came In lower was a ratio. the to we which than and to ratio, to due expense are own with our business. servicing bonus, this market run our flood in result, as underwriting take And was a NFIP we this and capabilities. right healthy John grow growth addressing the technology flood our actions. received aggressive bright rate our quarter business, rate we share expense the and As spot earned which and due benefited

$X.X aggressively XX% the investment Turning reflects This over million, $XX.X from work $X.X to in benchmark our income yield to fixed actions. a rising contribution, from up a yield from our strong The months fixed on in for results total portfolio environment. XX.X up to billion months million benefiting XXXX. in book the lag, a ago, $X.X in XX X-quarter points investments. quarter the year ago. quarter Alternative investment we translating was build generated After-tax the year for a have and third these to last third ago's interest rates Since the after-tax interest $X.X of from on ROE loss. XX X.X% net income the was income, up a X.X and rapidly manage quarter, income are reported of of million rate million start our the portfolio work of investments rise put points after-tax

portfolio Our well remains very positioned.

investments was of short-term of X.X duration of XX.X% As fixed XX, were with XX% quarter, the the Risk near and modestly an end range. in assets last approximately effective September from of low portfolio, our income target portfolio years. but up the of

our the credit the Fitch AA+ the the States the future, declined driven A+ AAA in default decrease range. In and our to quality long-term AA- the issuer expect by fixed investments in August. credit United During to A+ the downgrading rating quarter, remain from quality to we for AA-. average marginally to average of The short-term rating credit income in was

and our investment is quality underlying Importantly, strategy unchanged. credit

to book the portfolio's while continue into securities yield. opportunities attractive high-quality find We deploy new money increasing to

at basis average quarter, the $XXX an money X.X%, by improving yield XX we of to yield our During of X.XX%. invested pretax book new million points

has improved by start book XXXX. basis XXX since points Our yield of the approximately

yield portfolio reminder, on points points equates to basis XXX investment a every XXX approximately As pretax of of entire ROE. basis the

XX capital first is year position and months XXXX. remains of extremely the and for September X% this $XXX Operating X% capital adjusted end. share up or through Book as X cash equity per to compared Our with flow $X.X quarter million to surplus GAAP increased billion X% strong value statutory dividends. of of

period Our providing $XXX premiums million parent be and position our XX, range X.XXx company's growth increased powder. we'd driven with above on Net million, September be continues ample to by for a comfortable our target cash dry premium surplus long-term to of written to premium $XXX investment us X.XXx, totaled moving operating surplus X.XXx while to X.XX to above for strong target have flexibility to capital have support of was our of downstream significant we share time, the our and financial million strategic and shares quarter under to insurance have our reduce and our capital stable to remaining subsidiaries XX%, authorization. flexibility in repurchase We initiatives. $XX.X to we during Debt repurchase and at this execute strong appropriate. capacity growth the to not did any ratio

the at The operations. most a towards an within our organization, Shifting to Reflecting quarterly deploy remains profitable of continued view organic our of increase opportunities capital Board to growth share, dividend our Our XX%. $X.XX as per declared outlook. of Directors attractive growth our an insurance

full the compared start last For improved expectations and modestly year have XXXX, year. our of to the quarter

We continue to year an with expect underwriting of all-in expectation ratio the combined XX.X%. margins consistent GAAP for

after-tax income $XXX to million investment debt $XX We are million. by increasing our

the X.X X catastrophe Our of points points GAAP X.X guidance previous up from start ratio points of losses, from of up and XX.X% X combined includes of guidance now year. point our the

reserve no usual, as casualty development. guidance, Our year prior accident additional assumes

investment million from after-tax of investments. an Our income $XXX includes $XX million of alternative in assumption debt after-tax guidance gains

$XX of in gains fixed last portfolio decline unchanged effective our for make share offset from guidance, all guidance after-tax approximately of repurchases and any effective investment our our shares an tax Other our other with items, assumed tax expected and not XX% $XX in the in for does reflect with an income million rate remain down alternatives. elements average for XX%, more of net overall Although of under weighted which the from may we XX% than income quarter's assumption million, authorization. rate income diluted

Thanks Selective. has enjoyed we for last want an interacting Board CFO John and the thank a relationship, very working for do shareholders. value selective employees earnings extraordinary honor Lastly, excellent thank with to a with future. to and of Serving been is, who our for Directors, you years have I cover who and of proud look this we and the easy. you partners I created greatly. his what to course, in I'm all talented being notably of X able significant may Selective distribution leaving I've leadership of also is to same not accomplished, tremendous last privilege. our forward also admire the want not-too-distant as my to Selective. call our have

I believe term, Selective will and forward Over its the I delivering continued to continue long profitable growth, success. look

Now John. the call I'll back turn to

John J. Marchioni

Thank you, Mark.

on the we questions, line CFO transition. open Before to comment for our I like would briefly

and many Board assist the Mark years. thank well. and participating in our X we First, while over someone seamless transition, today's has entire to the call. fortunate into quarter caliber a I contributions the team, step pleased Chief search wish of to is his Selective closing interim We Accounting and to Officer, on trusted permanent are and we the behalf replacement. Harnett, in been us Mark last of Tony Directors for of want Mark our have we're role CFO a for his partner, could he a currently

Tony we Selective prospects our announcement, our confident priorities. equipped in of strategy. that team financial positioned to with not our is support execution or and stated will performance forward. we am as our I do finance impact continued Overall, are well the going excellent the expect Importantly, transition strong

and We the have opportunities strength to please the through that, cycles. manage capabilities open to growth capital market for and the organizational our call attractive questions. support business With effectively various tools operator,

Operator

[Operator Zaremski of Capital. Michael comes the BMO Our from Instructions] from first question line

Michael Zaremski

have perspective, data some about points Jack relief you falling selective the on topic, whether earlier inflation. inflation, cost impact had know for but mean was reserve I have be know higher lines. on interest And Mike. provided rates you between just levels. that an wanted if This decided potential year-over-year topic. to I you thoughts I they've particularly higher with have any of could ask this for for casualty insurers that levels is relationship I on the wondering tail I on correlated lost potential longer some

Mark Wilcox

my I of This to quarter, think lines if and impacts a respond comments, frequency bit it to business. in but I our as time, start? a I Why Jack, our little we related over Selective I is the a and we detailed But that a mistaken. think just loss going reserve not had Mark. emergence question, perspective time the from don't line I'm for of releases by costs how that your of hearing has forward, prepared reserve on a of perspective, major mentioned each very of review severity from all every ground-up record, quarter, And business. tough

has compensation of Over periods across our the unfavorable. business. frequency And driven a in each last a book particularly we've time been workers' been favorable and most XX of months years, quarter, considerable differently, benefits, favorable across plus commercial the post where Most favorable a and recently, auto. emergence the some we've recently, each in had prior XXXX, had general workers' also little and offsets, line our compensation, But been had from favorable some development. we've trend from of of development has liability including has responds claims year towards that's has reserve perspective. X been bit drag portfolio

trend the some of eye we some forward John and had that But favorable quarter, $X close development favorable look reserve are we're things some mentioned This of keeping around $X don't liability consistent any ratio quarter saw the personal commercial has of point. impact of We we in on million claims and we now that -- general book workers' our this a reserve back on. a offset that there adverse the X. trend observations at diminishing largely estimate slightly by development and was on terms impact out. it emergence in combined trend look again, meaningful think in, quarter compensation of from -- workers' million best comp, with generating was of year million our unfavorable commercial development But development auto overall, of that, on prior but $X auto

John J. Marchioni

other I the this our always loss of point just -- sort expected this trend reinforces been of accident in building increase an is transparent we've last quite is and around in And would couple the been John. years. we've over

As frequencies we've view to were by pointed stable. driven and largely as out, expected severity remain fairly that we

future. time. emerge into see And how you over trends of XXXX trends give as view those So out put we we the an those emerging updated our guidance, we'll

Michael Zaremski

And guess, covering lows. a Digging then starts strong is new I construction higher selective. the have points the construction-related the interest to when some on decade implications back construction now, and crisis declined my media we thinking for for second a data also which appreciate macro any question showing industry are you're been been has for niche a spending that all potential portfolio cycle? that while given meaningfully rates that over about this post-financial area there is meaningfully,

John J. Marchioni

So I sure right renew auditing around on accrual a estimating our the we every of construction once for that's of and policy expires. regular exposure -- stay disciplined write our on get we base Lines always something I right make but a we continues be strong, basis that then those policy top and including audit to estimating on the and to stay premium. policy process say we exposures to classes have we back make right, think ahead exposure evaluate our would are exposures new making we across every portfolio, looking Commercial sure and sure

starts years, I thing a model last other to pent-up different home still -- classes? robust a housing you artists remain best that will is the write are Because of necessarily I turnover We indicator significant the to have the class talk demand the lot continue of business. those It's contractor housing The think happened our construction looking forward. think other with classes, not lot in several over of in and remodeling would one not the class. thing and for we I is that's growth point of about

capture think I that's the of diligent exposure in been expiration happens we'll construction, it the but then certainly we've to we So economy. not base sorts business, classes about something That auditing in what just all and increases see to impact right always decreases. any after policy potential or get in the sure making has of exposures, but

Operator

line the Our next America. of question from Carter Bank from of Grace comes

Grace Carter

business growth any reprice the reaching broken for and expect help can at the the been Looking some maybe in strong pricing. us some personal new count about trends to think lines, target that really was if of from I policy hoping down as there's there you growth quarters. just past in as versus deceleration towards should sort continues And works book margins? we kind growth of there few

John J. Marchioni

certainly that this I to count see expect already in of expect couple would go-forward target see likely on starting you in basis to use a comparative certain restricted a are see start market. is of we've this it's and policy specifically think the platforms of our say by business factors, new that we're types growth, and a which I'd for on driven quoting we'll basis, to rating mass agents deceleration some Yes. and affluent and accounts

has had certainly an that So impact on new.

in I growth, that the starting ramp-up to you growth. think as and I rates we of but year and that on in written impact the the that the low written more importantly, rates about increase prepared the into we're renewal in course that also move of in the will basis, an rate the a And us to expectation XX% how heard impacts on have over think range. comments 'XX with regard significant the a see talk portfolio

continues new certainly, So little bit a to higher. pricing be business

that new pricing policy approved. still are XX% a Our about that's new over up the was immediate in a getting being driver. count little filings of business quarter But business. so But impact on because the the -- we're is

Grace Carter

of changed versus maybe think for with degree segment I entire help and to of you organization the the applying if prior it varies. it was the hoping think sticking And where was through could book combined goal us or we target personal where about kind the should is just and which transition XX% each to this mass kind the that's if to affluent for ratio lines,

John J. Marchioni

question. Great Yes.

as applying our to of the lines. about overall segments, have So including million business all that we $XX I X personal would think

ROE we organization today's rate for well important environment, basis. will in $XX in that again, million an a generate focused it's that XX% our long-term remain But on Now consistent of to on think excess target. interest the underwriting

that apply. in in changed in personal about to the lines you casualty hasn't we view think together, the roll it personal think It different target Obviously, basis. a all affluent. auto of would about segment, home terms that how way target. think is than So But XX% we mass regard lines with we on when to about them

Operator

And the Instructions] question line from comes your [Operator next of [Iniscernible] Piper Sandler.

Unknown Analyst

I'm can just all the update trying sort on your to them term, over guidance for long how to about been wondering think little us prospectively. you the of and better guys alternative if place a quarters year. investments the over I'm recent expectations just understand for you bit lowered in

Mark Wilcox

is here. This Mark Yes.

that. you of kind me walk through Let

generated know, asset returns an So as us. you alternatives, that very, very Within for description. is has a alternatives class relatively strong that's broad

pretty to allocation equity. We have private a healthy

and And going But after-tax there the have X% a when good an on XXX about an allocation real to in those for what generate for XX% about and different we return run. longer and that to real alternatives We dial $XX infrastructure. split prospective a down we call gain had we We basis, classes it, a a asset it are categories. in estate we've year. We assets, expectation XX% start private million This as had X% about between about year, you about expectation put returns asset a a, over had the and XX%, allocation we've out it's credit, was X those back QX. classes. saw, S&P of those to includes the Each to probably XXXX. think have Overall, it, call call expectations.

math through million, and best you estimate that's the return basically point. of income at sort this in $XX our we're the saying on of guidance So year-to-date quarter, fourth old when go versus X

crisis. back alternative IRR. you the look since had a been a of the XXXX, just portfolio up and in period to If back x out new under legacy, came that it investment over call started XX% multiyear take came ramp But in a to it's were a and of sort financial the our portfolio at team portfolio we

So million And in might XXXX $XX recall, it's a strong returns with about after on having remember particular, seem generated to and very, tax. you healthy very, returns. gain million very very

So it a for But tends think go about little around portfolio. would longer expectation return bit. I the with a to I bounce term, XX%

Operator

of Our question [ Cristello ] from KBW. comes the from next Dean line

Unknown Analyst

My first E&S I line. bit Is deceleration increases the seeing surprised are any see line. non-admitted color was question was there? you within the about could of Or to a additional still guys the sort property casualty, have flows you like market change of strong provide pricing you into sort if submission those lines? well. as there Or great seen could of be that a bifurcate between you recently? in And the dynamics would that and

John J. Marchioni

Yes. Sure.

and the X% use I was X.X% basis. year-to-date on term quarter the a I'd to in It hesitate guess So deceleration.

segment, an that's And cats ratio. extremely an year-to-date despite combined a ratio underlying a higher-than-expected so we're strong. strong and on context those of of all-in XX% the that's $XX.X million So XX.X% -- producing in that still of combined basis in

consider more deceleration. the from And X.X% was stable a that and So I in and casualty the in would overall, quarter a would than property was property X.X% I with to casualty regard pricing the perspective, quarter.

So strong we see growth.

think I business. growth writing that's driving the is that and we're business

We with. record have a long track

appetite an haven't stretched We really perspective. from underwriting

of and getting you away continue the see to market lot seen competition think market a in and overall bit really favorable ample see we're edges, the the that see edges, move say more constructive. market opportunities pretty just started as casualty. for little the and players call pricing remain could casualty-driven as have think from would both I business, and I property a generally there property that around our I is continue dynamics still around but We this growth on you've to speaking, from will We a to dynamic.

Unknown Analyst

was that? on percent from to plans certain guys a certain question into back follow-up to mass Do of sort is markets affluent My is regions market. lines could your sort in number expand affluent from the market? personal regions. We've have what sort capitalize as And chance pulled of lines that competitors you personal back you total noticed portfolio have of certain there of recently quantify any of to

John J. Marchioni

Yes.

with seeing at distribution to the So X-X, relative at -- on we're XX%, XX% that in plans little the new to space months, tilted the being mass a obviously, this near-term higher the regard from particular, nontarget of last But to don't We towards north mass you're much this and proportion certainly a point, in nontarget more have expand. affluent than point. perspective space. of any couple business affluent a of

some now in are potential from. focus could for XX,XX-state generally making the for down we segment expansion on that not really, footprint we our back the is that -- the Our speaking, profit have. targets be apologies that we my we that companies you the But right XX-state going it's to sure have business really of There footprint, currently that on states road. that see board pulling states achieve

we're If writer. book don't we're of heavy how coastal That's you portfolio, plan this look on a at not our not business. building writer coastal being a and heavy

pricing the our opportunities in taking, actions we'll we our margin we're footprint. further do targets, So to contemplate and over as years which we And current couple of see based next expansion. on ample then we expect underwriting approach

Unknown Analyst

in. for And Can if the of cat could commercial one more line business? sneak by quantify I you lines losses the

Mark Wilcox

certainly. Yes,

let the cat. walk this Mark just through for me quarter. the here you So And is

stand You lines? in want commercial to just

Unknown Analyst

Yes.

Mark Wilcox

Okay.

billion auto, on to million $X points property, X.X combined. or commercial BOP, the million $X.X So commercial for and $XX.X $XX.X QX, million

Operator

from comes Jamie. Our line the from last Bob question Farnam of

Robert Farnam

more A couple on personal of questions lines book. the

type expense ratio the difference percentage higher other to versus is a loss flow is the expecting of it's -- In kind a if mass as Just and is a And to affluent loss I'm forward? this expecting of affluent just of the are market trying through going -- the the of figure so, book ratio are lower markets more components. in affluent, out how you ratio. so a the same terms ratio mass words, combined grows going with you but expense ratio? the of

Mark Wilcox

sure. Yes,

go would Grace's question So to I earlier. back

into. basis based benefit about time think both for speaking, to over I we auto, do the what how of on and the margins. longer-term a aging rates particular enhanced basis of But class And think we think in home will business. profit risk-adjusted the to benefit. the at you do at business target, is moving about I this target and risk-adjusted and this see it lines that segment I our book that's how And additional on expect XX% in that And being space of retention that's applies creates one for. this striving think might higher market market, where this on a XX%. we we're you be generally look we're of a personal as that's again, some think see

Robert Farnam

types from All demand of you a really something right. it this are that customers finding not that is -- just Or factor services at these more And is selective? is point?

Mark Wilcox

service on drives also perspective. think and not Lines from is to in coverages base a our claim meet we side, well are So claims we we've product everybody matched the optional coverages, had claims the and to suited higher to customer lines a that's and they're always see our adoption this what we and offerings, From service around those adoption of of personal from that additional dialed expectations the including I philosophy think those higher that. a business, seeing are rate I Commercial marketplace, are perspective, applied a retentions a starting perspective, higher rate, we've by because business up servicing

Robert Farnam

reserve X.XX. right, was heard ratio on maybe auto. And X personal it mean, like of combined I points If of Mark that one I adverse development. question specifically the the sounds

in -- more So a get were way you XX% you're was for it, to that still much back long how it how is down just cats, seems to related of think of that going I'm get to still a it's get terms know to, getting of at long feel do a long down like go. but way it's probably it's but to XXX%. to XX%, going it's to to I still don't looking

Mark Wilcox

remain question -- settle there out how gap XX,XX.X I we there's loss it, you where loss about from next want in no that an have XX% that and expectations prior you But everybody and are there's of overcome. that a year for the will open million a think put pricing target from And at kind looking Well, XX% uncertain to the ultimately trends impact. drivers when highlighted of development, from accident some to strip impacting we about think is the low we've year somewhat industry. Mark's piece expectation year, fact out that that it, around together that, a trends, The question the of loss do you point the gap. out? have when think we're Europe, the impact trends that our range the but is for big the also pricing call what you the, is, commentary, call starting And

that's So we're that looking close. to gap the

We have rate clarity our plan. around

an the frame relative an on expect next determine come to ultimately basis quarters assumption trends to will get pieces we that X have to loss several the We how forward time those earned over and XX%. through that

Operator

questions don't At [Indiscernible] Thank time queue. you. any in we this have

proceed. may You

Mark Wilcox

all you soon. you. your Well, look you Thank to and thank for to forward talking participation

Operator

Thank you. participating. that all conference. today's Thank for you concludes And

may You now disconnect.

Selective Insurance (SIGI) 2 Nov 232023 Q3 Earnings call transcript