Attached files
file | filename |
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8-K - FORM 8-K - SELECTIVE INSURANCE GROUP INC | f8k_042514.htm |
EX-99.1 - EXHIBIT 99.1 - SELECTIVE INSURANCE GROUP INC | exh_991.htm |
EXHIBIT 99.2
Supplemental Investor Package
First Quarter 2014
Investor Contact:
Jennifer DiBerardino
Senior Vice President, Investor Relations and Treasurer
Tel: 973-948-1364
jennifer.diberardino@selective.com
|
Selective Insurance Group, Inc. & Consolidated Subsidiaries
Selected Balance Sheet Data
(unaudited)
March 31,
|
March 31,
|
December 31,
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||||||||||||||||||||||||||||||||||
($ in thousands, except per share data)
|
2014
|
2013
|
2013
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|||||||||||||||||||||||||||||||||
Unrecognized/
|
Unrecognized/
|
Unrecognized/
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||||||||||||||||||||||||||||||||||
Balance
|
Market
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Unrealized
|
Balance
|
Market
|
Unrealized
|
Balance
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Market
|
Unrealized
|
||||||||||||||||||||||||||||
Sheet
|
Value
|
Gain
|
Sheet
|
Value
|
Gain
|
Sheet
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Value
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Gain
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||||||||||||||||||||||||||||
Invested Assets:
|
||||||||||||||||||||||||||||||||||||
Corporate bonds 1
|
$ | 2,662,019 | 2,666,877 | 44,021 | $ | 2,388,239 | 2,396,950 | 100,025 | 2,595,256 | 2,601,556 | 27,812 | |||||||||||||||||||||||||
Government and Municipal bonds
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1,535,890 | 1,552,512 | 46,657 | 1,585,513 | 1,612,584 | 89,801 | 1,513,159 | 1,530,961 | 38,106 | |||||||||||||||||||||||||||
Total bonds
|
4,197,909 | 4,219,389 | 90,678 | 3,973,752 | 4,009,534 | 189,826 | 4,108,415 | 4,132,517 | 65,918 | |||||||||||||||||||||||||||
Equities
|
197,687 | 197,687 | 35,317 | 174,745 | 174,745 | 31,181 | 192,771 | 192,771 | 37,420 | |||||||||||||||||||||||||||
Short-term investments
|
137,733 | 137,733 | - | 163,440 | 163,440 | - | 174,251 | 174,251 | - | |||||||||||||||||||||||||||
Other investments
|
106,720 | 106,720 | - | 109,855 | 109,855 | - | 107,875 | 107,875 | - | |||||||||||||||||||||||||||
Total invested assets
|
4,640,049 | 4,661,529 | 125,995 | 4,421,792 | 4,457,574 | 221,007 | 4,583,312 | 4,607,414 | 103,338 | |||||||||||||||||||||||||||
Invested assets per $ of stockholders' equity
|
3.91 | 3.89 | 3.97 | |||||||||||||||||||||||||||||||||
Total assets
|
6,370,236 | 6,344,027 | 6,270,170 | |||||||||||||||||||||||||||||||||
Liabilities:
|
||||||||||||||||||||||||||||||||||||
Reserve for loss and loss expenses
|
3,432,432 | 3,474,392 | 3,349,770 | |||||||||||||||||||||||||||||||||
Unearned premium reserve
|
1,078,012 | 1,005,475 | 1,059,155 | |||||||||||||||||||||||||||||||||
Total liabilities
|
5,184,705 | 5,207,682 | 5,116,242 | |||||||||||||||||||||||||||||||||
Stockholders' equity
|
1,185,531 | 1,136,345 | 1,153,928 | |||||||||||||||||||||||||||||||||
Total debt to capitalization ratio
|
24.9 | % | 25.7 | % | 25.4 | % | ||||||||||||||||||||||||||||||
Book value per share
|
21.09 | 20.46 | 20.63 | |||||||||||||||||||||||||||||||||
Book value per share excluding unrealized gain or loss on bond portfolio
|
20.29 | 18.66 | 20.15 | |||||||||||||||||||||||||||||||||
NPW per insurance segment employee
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925 | 864 | 908 | |||||||||||||||||||||||||||||||||
Statutory premiums to surplus ratio
|
1.5 | x | 1.5 | x | 1.4 | x | ||||||||||||||||||||||||||||||
Statutory surplus
|
1,263,795 | 1,151,959 | 1,256,431 |
1 Includes mortgage-backed and asset-backed securities.
Selective Insurance Group, Inc. & Consolidated Subsidiaries
Selected Income Statement Data
(unaudited)
Quarter Ended March 31,
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|||||||||||||||||
($ in thousands, except per share amounts)
|
2014
|
2013
|
|||||||||||||||
Per diluted share
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Per diluted share
|
||||||||||||||||
Consolidated
|
|||||||||||||||||
Revenue
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$ | 509,071 | $ | 459,949 | |||||||||||||
Operating income
|
13,283 | 0.23 | 20,124 | 0.36 | |||||||||||||
Net realized gains, after tax
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4,691 | 0.08 | 2,181 | 0.04 | |||||||||||||
Income from continuing operations
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17,974 | 0.31 | 22,305 | 0.40 | |||||||||||||
Loss on discontinued operations, after tax
|
|
- | - | (997 | ) | (0.02 | ) | ||||||||||
Net income
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17,974 | 0.31 | 21,308 | 0.38 | |||||||||||||
Operating return on equity
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4.5 | % | 7.2 | % | |||||||||||||
Total Insurance Operations
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|||||||||||||||||
Gross premiums written
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565,741 | 537,298 | |||||||||||||||
Net premiums written
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476,750 | 450,124 | |||||||||||||||
Net premiums earned
|
456,495 | 420,940 | |||||||||||||||
Underwriting (loss) gain
|
- before tax
|
(5,015 | ) | 12,161 | |||||||||||||
- after tax
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(3,260 | ) | (0.06 | ) | 7,905 | 0.14 | |||||||||||
GAAP combined ratio
|
101.1 | % | 97.1 | % | |||||||||||||
Total Standard lines
|
|||||||||||||||||
Net premiums earned
|
424,259 | 390,881 | |||||||||||||||
GAAP combined ratio
|
101.4 | % | 96.9 | % | |||||||||||||
Standard Commercial lines
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|||||||||||||||||
Net premiums earned
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349,441 | 317,845 | |||||||||||||||
GAAP combined ratio
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101.0 | % | 98.1 | % | |||||||||||||
Standard Personal lines
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|||||||||||||||||
Net premiums earned
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74,818 | 73,036 | |||||||||||||||
GAAP combined ratio
|
103.2 | % | 91.8 | % | |||||||||||||
Excess and Surplus lines
|
|||||||||||||||||
Net premiums earned
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32,236 | 30,059 | |||||||||||||||
GAAP combined ratio
|
97.0 | % | 99.7 | % | |||||||||||||
Investments
|
|||||||||||||||||
Net investment income
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- before tax
|
35,534 | 32,870 | ||||||||||||||
- after tax
|
26,486 | 0.46 | 24,839 | 0.44 | |||||||||||||
Effective tax rate
|
25.5 | % | 24.4 | % | |||||||||||||
Annual after-tax yield on investment portfolio
|
|
2.3 | % | 2.3 | % | ||||||||||||
Annual after-tax, after-interest expense yield
|
|
2.0 | % | 1.9 | % | ||||||||||||
Invested assets per $ of stockholders' equity
|
|
3.91 | 3.89 | ||||||||||||||
Other expenses (net of other income)
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|||||||||||||||||
Interest expense
|
- before tax
|
(5,561 | ) | (5,831 | ) | ||||||||||||
- after tax
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(3,615 | ) | (0.06 | ) | (3,790 | ) | (0.07 | ) | |||||||||
Other Expense - after tax
|
$ | (6,328 | ) | (0.11 | ) | $ | (8,830 | ) | (0.15 | ) | |||||||
Diluted weighted avg shares outstanding
|
57,172 | 56,455 |
Selective Insurance Group, Inc. & Consolidated Subsidiaries
GAAP Insurance Operations Results
First Quarter
($ in thousands)
|
Quarter Ended March 31, 2014
|
Quarter Ended March 31, 2013
|
||||||||||||||||||||||||||||||||||||||
Standard Commercial Lines
|
Standard Personal Lines
|
Total Standard Lines
|
Excess & Surplus Lines
|
Grand Total
|
Standard Commercial Lines
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Standard Personal Lines
|
Total Standard Lines
|
Excess & Surplus Lines
|
Grand Total
|
|||||||||||||||||||||||||||||||
Net Premiums Written
|
379,350 | 67,338 | 446,688 | 30,062 | 476,750 | 353,189 | 68,555 | 421,744 | 28,380 | 450,124 | ||||||||||||||||||||||||||||||
Net Premiums Earned
|
349,441 | 74,818 | 424,259 | 32,236 | 456,495 | 317,845 | 73,036 | 390,881 | 30,059 | 420,940 | ||||||||||||||||||||||||||||||
Loss and Loss Expenses Incurred
|
242,639 | 58,027 | 300,666 | 19,880 | 320,546 | 203,139 | 47,592 | 250,731 | 19,118 | 269,849 | ||||||||||||||||||||||||||||||
Net Underwriting Expenses Incurred
|
109,194 | 19,151 | 128,345 | 11,381 | 139,726 | 107,518 | 19,471 | 126,989 | 10,855 | 137,844 | ||||||||||||||||||||||||||||||
Dividends to Policyholders
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1,238 | - | 1,238 | - | 1,238 | 1,086 | - | 1,086 | - | 1,086 | ||||||||||||||||||||||||||||||
GAAP Underwriting (Loss) Gain
|
(3,630 | ) | (2,360 | ) | (5,990 | ) | 975 | (5,015 | ) | 6,102 | 5,973 | 12,075 | 86 | 12,161 | ||||||||||||||||||||||||||
GAAP Ratios
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||||||||||||||||||||||||||||||||||||||||
Loss and Loss Expense Ratio
|
69.4 | % | 77.6 | % | 70.9 | % | 61.7 | % | 70.2 | % | 63.9 | % | 65.2 | % | 64.1 | % | 63.6 | % | 64.1 | % | ||||||||||||||||||||
Underwriting Expense Ratio
|
31.2 | % | 25.6 | % | 30.2 | % | 35.3 | % | 30.6 | % | 33.9 | % | 26.6 | % | 32.5 | % | 36.1 | % | 32.7 | % | ||||||||||||||||||||
Dividends to Policyholders Ratio
|
0.4 | % | 0.0 | % | 0.3 | % | 0.0 | % | 0.3 | % | 0.3 | % | 0.0 | % | 0.3 | % | 0.0 | % | 0.3 | % | ||||||||||||||||||||
Combined Ratio
|
101.0 | % | 103.2 | % | 101.4 | % | 97.0 | % | 101.1 | % | 98.1 | % | 91.8 | % | 96.9 | % | 99.7 | % | 97.1 | % | ||||||||||||||||||||
Selective Insurance Group, Inc. and Consolidated Subsidiaries
GAAP Investment Income
March 2014 (unaudited)
Quarter Ended
|
%
|
|||||||||||
March
|
March
|
Increase
|
||||||||||
($ in thousands, except per share data)
|
2014
|
2013
|
(Decrease)
|
|||||||||
Investment Income:
|
||||||||||||
Interest:
|
||||||||||||
Fixed Income Securities
|
$ | 31,028 | 30,089 | 3 | ||||||||
Short-term
|
19 | 52 | (64 | ) | ||||||||
Other Investments:
|
||||||||||||
Alternative Investments
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5,218 | 4,240 | 23 | |||||||||
Other
|
- | (638 | ) | N/M | ||||||||
Dividends
|
1,449 | 1,207 | 20 | |||||||||
37,714 | 34,950 | 8 | ||||||||||
Investment Expense
|
2,180 | 2,080 | 5 | |||||||||
Net Investment Income Before Tax
|
35,534 | 32,870 | 8 | |||||||||
Tax
|
9,048 | 8,031 | 13 | |||||||||
Net Investment Income After Tax
|
$ | 26,486 | 24,839 | 7 | ||||||||
Net Investment Income per Share
|
$ | 0.46 | 0.44 | 5 | ||||||||
Effective Tax Rate
|
25.5 | % | 24.4 | % | ||||||||
Average Yields :
|
||||||||||||
Fixed Income Securities:
|
||||||||||||
Pre Tax
|
2.99 | % | 3.08 | % | ||||||||
After Tax
|
2.24 | % | 2.33 | % | ||||||||
Portfolio:
|
||||||||||||
Pre Tax
|
3.08 | % | 3.00 | % | ||||||||
After Tax
|
2.30 | % | 2.27 | % | ||||||||
Year to date:
|
||||||||||||
March
|
March
|
|||||||||||
Net Realized Gains (Losses)
|
2014 | 2013 | ||||||||||
Fixed Income Securities
|
35 | 651 | ||||||||||
Equity Securities
|
7,183 | 5,287 | ||||||||||
Other Investments
|
- | (2,583 | ) | |||||||||
Total
|
7,218 | 3,355 | ||||||||||
Net of Tax
|
4,691 | 2,181 |
As of March 31, 2014 year-to-date new money rates for fixed income securities were 2.6% on a pre-tax basis and 1.9% on an after tax-basis.
Selective Insurance Group, Inc.
Combined Insurance Company Subsidiaries
2014 Statutory Results by Line of Business
Quarter Ended March 2014 (unaudited)
($ in thousands)
|
Net
Premiums |
Percent
Change |
Net
Premiums |
Percent
Change |
Loss
Ratio |
LAE
Ratio |
Underwriting
Expense |
Dividends to
Policyholders |
Combined Ratio
2014 |
Combined Ratio
2013 |
Underwriting
Gain/(Loss) |
|||||||||||||||||||||||||||||||||
Standard Personal Lines:
|
||||||||||||||||||||||||||||||||||||||||||||
Homeowners
|
$ | 28,700 | 3.1 | % | $ | 33,298 | 6.9 | % | 79.9 | % | 8.0 | % | 33.8 | % | 0.0 | % | 121.7 | % | 87.7 | % | $ | (5,668 | ) | |||||||||||||||||||||
Auto
|
36,817 | (2.3 | )% | 38,227 | (0.4 | )% | 59.9 | % | 11.1 | % | 29.9 | % | 0.0 | % | 100.9 | % | 105.7 | % | 60 | |||||||||||||||||||||||||
Other (including flood)
|
1,821 | (40.0 | )% | 3,294 | (6.1 | )% | 50.9 | % | 4.8 | % | (149.1 | )% | 0.0 | % | (93.4 | )% | (19.1 | )% | 4,264 | |||||||||||||||||||||||||
Total
|
$ | 67,338 | (1.8 | )% | $ | 74,818 | 2.4 | % | 68.4 | % | 9.2 | % | 26.9 | % | 0.0 | % | 104.5 | % | 92.4 | % | $ | (1,344 | ) | |||||||||||||||||||||
Standard Commercial Lines:
|
||||||||||||||||||||||||||||||||||||||||||||
Commerical property
|
$ | 64,096 | 11.0 | % | $ | 60,186 | 12.7 | % | 92.0 | % | 5.0 | % | 34.3 | % | 0.1 | % | 131.4 | % | 86.6 | % | $ | (20,220 | ) | |||||||||||||||||||||
Workers compensation
|
75,971 | 0.8 | % | 69,413 | 5.0 | % | 64.7 | % | 15.4 | % | 24.3 | % | 1.5 | % | 105.9 | % | 118.9 | % | (5,686 | ) | ||||||||||||||||||||||||
General liability
|
119,504 | 9.2 | % | 108,818 | 11.4 | % | 32.8 | % | 16.7 | % | 31.2 | % | 0.0 | % | 80.7 | % | 95.9 | % | 17,713 | |||||||||||||||||||||||||
Auto
|
89,122 | 8.9 | % | 82,216 | 10.6 | % | 58.1 | % | 7.5 | % | 29.2 | % | 0.1 | % | 94.9 | % | 98.0 | % | 2,153 | |||||||||||||||||||||||||
Business owners policies
|
22,124 | 8.7 | % | 20,869 | 12.6 | % | 83.7 | % | 10.3 | % | 35.8 | % | 0.0 | % | 129.8 | % | 77.0 | % | (6,666 | ) | ||||||||||||||||||||||||
Bonds
|
4,866 | (1.8 | )% | 4,756 | (0.2 | )% | 16.4 | % | 8.6 | % | 51.9 | % | 0.0 | % | 76.9 | % | 78.0 | % | 1,040 | |||||||||||||||||||||||||
Other
|
3,665 | 6.7 | % | 3,183 | 6.5 | % | (0.4 | )% | 0.1 | % | 43.0 | % | 0.0 | % | 42.7 | % | 38.6 | % | 1,617 | |||||||||||||||||||||||||
Total
|
$ | 379,350 | 7.4 | % | $ | 349,441 | 9.9 | % | 57.8 | % | 11.6 | % | 30.5 | % | 0.4 | % | 100.3 | % | 97.6 | % | $ | (10,049 | ) | |||||||||||||||||||||
Total Standard Operations
|
$ | 446,688 | 5.9 | % | $ | 424,259 | 8.5 | % | 59.7 | % | 11.2 | % | 29.9 | % | 0.3 | % | 101.1 | % | 96.8 | % | $ | (11,393 | ) | |||||||||||||||||||||
E&S
|
$ | 30,062 | 5.9 | % | $ | 32,236 | 7.2 | % | 46.8 | % | 14.9 | % | 36.2 | % | 0.0 | % | 97.9 | % | 98.2 | % | $ | 1,479 | ||||||||||||||||||||||
Total Insurance Operations
|
$ | 476,750 | 5.9 | % | $ | 456,495 | 8.4 | % | 58.8 | % | 11.4 | % | 30.3 | % | 0.3 | % | 100.8 | % | 96.8 | % | $ | (9,914 | ) | |||||||||||||||||||||
Note: Some amounts may not foot due to rounding.
|
2014
|
2013
|
|||||||||
Losses Paid
|
$ | 213,297 | $ | 187,285 | ||||||
LAE Paid
|
44,764 | 44,989 | ||||||||
Total Paid
|
$ | 258,061 | $ | 232,274 | ||||||
Selective Insurance Group, Inc.
Combined Insurance Company Subsidiaries
2014 Net Catastrophe Losses and Prior Year Casualty Reserve Development
Statutory Results by Line of Business
(unaudited)
Quarter Ended
|
||||||||||||||||
Net Catastrophe Losses Incurred
|
March 31, 2014
|
March 31, 2013
|
||||||||||||||
($ in thousands)
|
Loss and Loss
Expense Incurred
|
Impact on Loss and
Loss Expense Ratio
|
Loss and Loss
Expense Incurred
|
Impact on Loss and
Loss Expense Ratio
|
||||||||||||
Standard Personal Lines
|
$ | 8,280 | 11.1 | % | $ | 535 | 0.7 | % | ||||||||
Standard Commercial Lines
|
$ | 25,906 | 7.4 | % | $ | 738 | 0.2 | % | ||||||||
Total Standard Operations
|
$ | 34,186 | 8.1 | % | $ | 1,273 | 0.3 | % | ||||||||
E&S
|
$ | 186 | 0.6 | % | $ | 303 | 1.0 | % | ||||||||
Total Insurance Operations
|
$ | 34,372 | 7.5 | % | $ | 1,576 | 0.4 | % | ||||||||
Prior Year Casualty Reserve Development
|
Quarter Ended
|
|||||||||||||||
(Favorable) / Unfavorable
|
March 31, 2014
|
March 31, 2013
|
||||||||||||||
($ in thousands)
|
Loss and Loss
Expense Incurred
|
Impact on Loss and
Loss Expense Ratio
|
Loss and Loss
Expense Incurred
|
Impact on Loss and
Loss Expense Ratio
|
||||||||||||
Standard Personal Lines
|
$ | (2,000 | ) | (2.7 | )% | $ | (2,500 | ) | (3.4 | )% | ||||||
Standard Commercial Lines
|
$ | (12,000 | ) | (3.4 | )% | $ | 500 | 0.1 | % | |||||||
Total Standard Operations
|
$ | (14,000 | ) | (3.3 | )% | $ | (2,000 | ) | (0.5 | )% | ||||||
E&S
|
$ | - | 0.0 | % | $ | 500 | 1.7 | % | ||||||||
Total Insurance Operations
|
$ | (14,000 | ) | (3.1 | )% | $ | (1,500 | ) | (0.4 | )% |
Note: Some amounts may not foot due to rounding.
Selective Insurance Group, Inc. & Consolidated Subsidiaries
|
||||||||
Consolidated Balance Sheets
|
||||||||
(Unaudited)
March 31,
|
December 31,
|
|||||||
($ in thousands)
|
2014
|
2013
|
||||||
ASSETS
|
||||||||
Investments:
|
||||||||
Fixed income securities, held-to-maturity – at carrying value (fair value: $403,536 – 2014; $416,981 – 2013)
|
$ | 382,056 | 392,879 | |||||
Fixed income securities, available-for-sale – at fair value (amortized cost: $3,748,456 – 2014; $3,675,977 – 2013)
|
3,815,853 | 3,715,536 | ||||||
Equity securities, available-for-sale – at fair value (cost: $162,370 – 2014; $155,350 – 2013)
|
197,687 | 192,771 | ||||||
Short-term investments (at cost which approximates fair value)
|
137,733 | 174,251 | ||||||
Other investments
|
106,720 | 107,875 | ||||||
Total investments
|
4,640,049 | 4,583,312 | ||||||
Cash
|
245 | 193 | ||||||
Interest and dividends due or accrued
|
36,967 | 37,382 | ||||||
Premiums receivable, net of allowance for uncollectible accounts of: $3,771 – 2014; $4,442 – 2013
|
553,912 | 524,870 | ||||||
Reinsurance recoverable, net
|
574,621 | 550,897 | ||||||
Prepaid reinsurance premiums
|
141,603 | 143,000 | ||||||
Current federal income tax
|
— | 512 | ||||||
Deferred federal income tax
|
113,061 | 122,613 | ||||||
Property and equipment – at cost, net of accumulated depreciation and amortization of: $181,959 – 2014; $179,192 – 2013
|
53,725 | 50,834 | ||||||
Deferred policy acquisition costs
|
177,678 | 172,981 | ||||||
Goodwill
|
7,849 | 7,849 | ||||||
Other assets
|
70,526 | 75,727 | ||||||
Total assets
|
$ | 6,370,236 | 6,270,170 | |||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
||||||||
Liabilities:
|
||||||||
Reserve for loss and loss expenses
|
$ | 3,432,432 | 3,349,770 | |||||
Unearned premiums
|
1,078,012 | 1,059,155 | ||||||
Notes payable
|
392,420 | 392,414 | ||||||
Current federal income tax
|
3,249 | — | ||||||
Accrued salaries and benefits
|
89,558 | 111,427 | ||||||
Other liabilities
|
189,034 | 203,476 | ||||||
Total liabilities
|
$ | 5,184,705 | 5,116,242 | |||||
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: 99,536,697 – 2014; 99,120,235 – 2013
|
199,073 | 198,240 | ||||||
Additional paid-in capital
|
294,365 | 288,182 | ||||||
Retained earnings
|
1,212,577 | 1,202,015 | ||||||
Accumulated other comprehensive income
|
41,529 | 24,851 | ||||||
Treasury stock – at cost (shares: 43,317,498 – 2014; 43,198,622 – 2013)
|
(562,013 | ) | (559,360 | ) | ||||
Total stockholders’ equity
|
1,185,531 | 1,153,928 | ||||||
Commitments and contingencies
|
||||||||
Total liabilities and stockholders’ equity
|
$ | 6,370,236 | 6,270,170 |
Selective Insurance Group, Inc. & Consolidated Subsidiaries
|
||||||||
Unaudited Consolidated Statements of Income
|
||||||||
Quarter Ended
|
||||||||
March 31,
|
||||||||
($ in thousands, except per share amounts)
|
2014
|
2013
|
||||||
Revenues:
|
||||||||
Net premiums earned
|
$ | 456,495 | 420,940 | |||||
Net investment income earned
|
35,534 | 32,870 | ||||||
Net realized gains:
|
||||||||
Net realized investment gains
|
8,181 | 5,304 | ||||||
Other-than-temporary impairments
|
(963 | ) | (1,919 | ) | ||||
Other-than-temporary impairments on fixed income securities recognized in other comprehensive income
|
— | (30 | ) | |||||
Total net realized gains
|
7,218 | 3,355 | ||||||
Other income
|
9,824 | 2,784 | ||||||
Total revenues
|
509,071 | 459,949 | ||||||
Expenses:
|
||||||||
Loss and loss expenses incurred
|
320,546 | 269,849 | ||||||
Policy acquisition costs
|
149,266 | 139,528 | ||||||
Interest expense
|
5,561 | 5,831 | ||||||
Other expenses
|
8,614 | 15,873 | ||||||
Total expenses
|
483,987 | 431,081 | ||||||
Income from continuing operations, before federal income tax
|
25,084 | 28,868 | ||||||
Federal income tax expense (benefit):
|
||||||||
Current
|
6,538 | 7,453 | ||||||
Deferred
|
572 | (890 | ) | |||||
Total federal income tax expense
|
7,110 | 6,563 | ||||||
Net income from continuing operations
|
17,974 | 22,305 | ||||||
Loss on disposal of discontinued operations, net of tax of $(538) - 2013
|
— | (997 | ) | |||||
Net income
|
$ | 17,974 | 21,308 | |||||
Earnings per share:
|
||||||||
Basic net income from continuing operations
|
$ | 0.32 | 0.40 | |||||
Basic net loss from discontinued operations
|
— | (0.02 | ) | |||||
Basic net income
|
$ | 0.32 | 0.38 | |||||
Diluted net income from continuing operations
|
$ | 0.31 | 0.40 | |||||
Diluted net loss from discontinued operations
|
— | (0.02 | ) | |||||
Diluted net income
|
$ | 0.31 | 0.38 | |||||
Dividends to stockholders
|
$ | 0.13 | 0.13 |
Selective Insurance Group, Inc. & Consolidated Subsidiaries
|
||||||||
Unaudited Consolidated Statements of Comprehensive Income
|
Quarter Ended
|
|||||||
March 31,
|
||||||||
($ in thousands)
|
2014
|
2013
|
||||||
Net income
|
$ | 17,974 | 21,308 | |||||
Other comprehensive income, net of tax:
|
||||||||
Unrealized gains (losses) on investment securities:
|
||||||||
Unrealized holding gains arising during period
|
21,426 | 2,394 | ||||||
Non-credit portion of other-than-temporary impairments recognized in other comprehensive income
|
— | 20 | ||||||
Amount reclassified into net income:
|
||||||||
Held-to-maturity securities
|
(296 | ) | (466 | ) | ||||
Non-credit other-than-temporary impairment
|
— | 4 | ||||||
Realized gains on available for sale securities
|
(4,699 | ) | (3,884 | ) | ||||
Total unrealized gains (losses) on investment securities
|
16,431 | (1,932 | ) | |||||
Defined benefit pension and post-retirement plans:
|
||||||||
Net actuarial gain
|
— | 28,600 | ||||||
Amounts reclassified into net income:
|
||||||||
Net actuarial loss
|
247 | 1,196 | ||||||
Prior service cost
|
— | 6 | ||||||
Curtailment expense
|
— | 11 | ||||||
Total defined benefit pension and post-retirement plans
|
247 | 29,813 | ||||||
Other comprehensive income
|
16,678 | 27,881 | ||||||
Comprehensive income
|
$ | 34,652 | 49,189 |
Selective Insurance Group, Inc. & Consolidated Subsidiaries
|
||||||||
Unaudited Consolidated Statements of Stockholders’ Equity
|
Quarter Ended
|
|||||||
March 31,
|
||||||||
($ in thousands)
|
2014
|
2013
|
||||||
Common stock:
|
||||||||
Beginning of year
|
$ | 198,240 | 196,388 | |||||
Dividend reinvestment plan (shares: 15,283 – 2014; 17,314 – 2013)
|
31 | 35 | ||||||
Stock purchase and compensation plans (shares: 401,179 – 2014; 496,647 – 2013)
|
802 | 993 | ||||||
End of period
|
199,073 | 197,416 | ||||||
Additional paid-in capital:
|
||||||||
Beginning of year
|
288,182 | 270,654 | ||||||
Dividend reinvestment plan
|
320 | 349 | ||||||
Stock purchase and compensation plans
|
5,863 | 5,714 | ||||||
End of period
|
294,365 | 276,717 | ||||||
Retained earnings:
|
||||||||
Beginning of year
|
1,202,015 | 1,125,154 | ||||||
Net income
|
17,974 | 21,308 | ||||||
Dividends to stockholders ($0.13 per share – 2014 and 2013)
|
(7,412 | ) | (7,351 | ) | ||||
End of period
|
1,212,577 | 1,139,111 | ||||||
Accumulated other comprehensive income:
|
||||||||
Beginning of year
|
24,851 | 54,040 | ||||||
Other comprehensive income
|
16,678 | 27,881 | ||||||
End of period
|
41,529 | 81,921 | ||||||
Treasury stock:
|
||||||||
Beginning of year
|
(559,360 | ) | (555,644 | ) | ||||
Acquisition of treasury stock (shares: 118,876 – 2014; 146,436 – 2013)
|
(2,653 | ) | (3,176 | ) | ||||
End of period
|
(562,013 | ) | (558,820 | ) | ||||
Total stockholders’ equity
|
$ | 1,185,531 | 1,136,345 |
Selective Insurance Group, Inc. & Consolidated Subsidiaries
|
||||||||
Unaudited Consolidated Statements of Cash Flow
|
Quarter Ended
|
|||||||
March 31,
|
||||||||
($ in thousands)
|
2014
|
2013
|
||||||
Operating Activities:
|
||||||||
Net Income
|
$ | 17,974 | 21,308 | |||||
Adjustments to reconcile net income to net cash provided by operating activities:
|
||||||||
Depreciation and amortization
|
10,578 | 13,148 | ||||||
Sale of renewal rights
|
(8,000 | ) | — | |||||
Loss on disposal of discontinued operations
|
— | 997 | ||||||
Stock-based compensation expense
|
4,176 | 3,692 | ||||||
Undistributed (gains) losses of equity method investments
|
(33 | ) | 426 | |||||
Net realized gains
|
(7,218 | ) | (3,355 | ) | ||||
Retirement income plan curtailment expense
|
— | 16 | ||||||
Changes in assets and liabilities:
|
||||||||
Increase in reserve for loss and loss expenses, net of reinsurance recoverables
|
58,938 | 38,556 | ||||||
Increase in unearned premiums, net of prepaid reinsurance and advance premiums
|
19,875 | 30,106 | ||||||
Decrease in net federal income taxes
|
4,332 | 5,290 | ||||||
Increase in premiums receivable
|
(29,042 | ) | (36,202 | ) | ||||
Increase in deferred policy acquisition costs
|
(4,697 | ) | (2,963 | ) | ||||
Decrease in interest and dividends due or accrued
|
414 | 384 | ||||||
Decrease in accrued salaries and benefits
|
(21,869 | ) | (4,528 | ) | ||||
Decrease in accrued insurance expenses
|
(26,957 | ) | (12,378 | ) | ||||
Other-net
|
17,293 | (26,357 | ) | |||||
Net adjustments
|
17,790 | 6,832 | ||||||
Net cash provided by operating activities
|
35,764 | 28,140 | ||||||
Investing Activities:
|
||||||||
Purchase of fixed income securities, available-for-sale
|
(182,809 | ) | (308,289 | ) | ||||
Purchase of equity securities, available-for-sale
|
(61,360 | ) | (2 | ) | ||||
Purchase of other investments
|
(4,615 | ) | (2,329 | ) | ||||
Purchase of short-term investments
|
(398,348 | ) | (644,274 | ) | ||||
Sale of subsidiary
|
— | 225 | ||||||
Sale of fixed income securities, available-for-sale
|
1,302 | 6,851 | ||||||
Sale of short-term investments
|
434,865 | 695,313 | ||||||
Redemption and maturities of fixed income securities, held-to-maturity
|
9,396 | 28,644 | ||||||
Redemption and maturities of fixed income securities, available-for-sale
|
104,358 | 124,975 | ||||||
Sale of equity securities, available-for-sale
|
61,523 | — | ||||||
Distributions from other investments
|
5,704 | 3,447 | ||||||
Purchase of property and equipment
|
(5,699 | ) | (3,673 | ) | ||||
Sale of renewal rights
|
8,000 | — | ||||||
Net cash used in investing activities
|
(27,683 | ) | (99,112 | ) | ||||
Financing Activities:
|
||||||||
Dividends to stockholders
|
(6,948 | ) | (6,824 | ) | ||||
Acquisition of treasury stock
|
(2,653 | ) | (3,176 | ) | ||||
Net proceeds from stock purchase and compensation plans
|
1,261 | 1,164 | ||||||
Proceeds from issuance of notes payable, net of debt issuance costs
|
— | 178,623 | ||||||
Repayment of notes payable
|
— | (100,000 | ) | |||||
Excess tax benefits from share-based payment arrangements
|
770 | 1,271 | ||||||
Repayment of capital lease obligations
|
(459 | ) | — | |||||
Net cash (used in) provided by financing activities
|
(8,029 | ) | 71,058 | |||||
Net increase in cash
|
52 | 86 | ||||||
Cash, beginning of year
|
193 | 210 | ||||||
Cash, end of year
|
$ | 245 | 296 |
Selective Insurance Group, Inc.
Combined Insurance Company Subsidiaries
Statutory Balance Sheets
(unaudited)
($ in thousands)
|
March 31,
2014 |
March 31,
2013 |
December 31,
2013 |
|||||||||
ASSETS
|
||||||||||||
Bonds
|
$ | 4,072,964 | 3,762,737 | 4,010,464 | ||||||||
Common stocks
|
197,688 | 174,745 | 192,771 | |||||||||
Affiliated mortgage loan
|
36,534 | 37,266 | 36,721 | |||||||||
Other investments
|
172,691 | 175,873 | 173,856 | |||||||||
Short-term investments
|
122,118 | 131,767 | 158,827 | |||||||||
Total investments
|
4,601,995 | 4,282,388 | 4,572,639 | |||||||||
Cash on hand and in banks
|
(40,405 | ) | 8,784 | (31,186 | ) | |||||||
Interest and dividends due and accrued
|
36,862 | 35,235 | 37,267 | |||||||||
Premiums receivable
|
551,784 | 519,114 | 522,907 | |||||||||
Reinsurance recoverable on paid losses and expenses
|
13,068 | 10,369 | 10,059 | |||||||||
Deferred tax recoverable
|
154,620 | 151,114 | 154,320 | |||||||||
EDP equipment
|
834 | 1,188 | 913 | |||||||||
Equities and deposits in pools and associations
|
8,557 | 7,838 | 9,555 | |||||||||
Receivable for sold securities
|
8 | 35,930 | 7 | |||||||||
Other assets
|
26,535 | 22,175 | 30,671 | |||||||||
Total assets
|
$ | 5,353,858 | 5,074,135 | 5,307,152 | ||||||||
LIABILITIES
|
||||||||||||
Reserve for losses
|
$ | 2,396,417 | 2,258,016 | 2,341,476 | ||||||||
Reinsurance payable on paid loss and loss expense
|
2,098 | 1,813 | 2,557 | |||||||||
Reserve for loss expenses
|
463,527 | 434,045 | 455,983 | |||||||||
Unearned premiums
|
936,409 | 871,253 | 916,155 | |||||||||
Reserve for commissions payable
|
41,455 | 41,304 | 63,482 | |||||||||
Ceded balances payable
|
29,728 | 51,565 | 33,721 | |||||||||
Federal income tax payable
|
31,587 | 21,281 | 27,749 | |||||||||
Premium and other taxes payable
|
22,940 | 23,226 | 27,870 | |||||||||
Borrowed money
|
58,044 | 58,044 | 58,044 | |||||||||
Reserve for dividends to policyholders
|
2,019 | 2,348 | 2,070 | |||||||||
Reserves for unauthorized reinsurance
|
2,735 | 7,498 | 2,735 | |||||||||
Payable for securities
|
1,773 | 46,296 | - | |||||||||
Funds withheld on account of others
|
7,724 | 7,217 | 6,623 | |||||||||
Accrued salaries and benefits
|
46,499 | 78,592 | 65,053 | |||||||||
Other liabilities
|
47,108 | 19,678 | 47,203 | |||||||||
Total liabilities
|
4,090,063 | 3,922,176 | 4,050,721 | |||||||||
POLICYHOLDERS' SURPLUS
|
||||||||||||
Capital
|
42,725 | 42,725 | 42,725 | |||||||||
Paid in surplus
|
492,869 | 492,869 | 492,869 | |||||||||
Unassigned surplus
|
728,201 | 616,365 | 720,837 | |||||||||
Total policyholders' surplus
|
1,263,795 | 1,151,959 | 1,256,431 | |||||||||
Total liabilities and policyholders' surplus
|
$ | 5,353,858 | 5,074,135 | 5,307,152 |
Selective Insurance Group, Inc.
Combined Insurance Company Subsidiaries
Statutory Statements Of Income
(unaudited)
Quarter Ended
March
|
||||||||||||||||
($ in thousands)
|
2014
|
2013
|
||||||||||||||
UNDERWRITING
|
||||||||||||||||
Net premiums written
|
$ | 476,750 | 450,124 | |||||||||||||
Net premiums earned
|
456,495 | 420,940 | ||||||||||||||
Net losses paid
|
213,297 | 187,285 | ||||||||||||||
Change in reserve for losses
|
54,941 | 31,158 | ||||||||||||||
Net losses incurred
|
268,238 | 58.8 | % | 218,443 | 51.9 | % | ||||||||||
Net loss expenses paid
|
44,764 | 44,989 | ||||||||||||||
Change in reserve for loss expenses
|
7,544 | 6,484 | ||||||||||||||
Net loss expenses incurred
|
52,308 | 11.4 | % | 51,473 | 12.2 | % | ||||||||||
Net underwriting expenses incurred
|
153,790 | 32.2 | % | 148,340 | 32.9 | % | ||||||||||
Total deductions
|
474,336 | 418,256 | ||||||||||||||
Statutory underwriting (loss) / gain
|
(17,840 | ) | 2,684 | |||||||||||||
Net loss from premium balances charged off
|
(874 | ) | (734 | ) | ||||||||||||
Finance charges and other income
|
10,038 | 2,932 | ||||||||||||||
Total other income
|
9,164 | -1.9 | % | 2,198 | -0.5 | % | ||||||||||
Policyholders' dividends incurred
|
(1,238 | ) | 0.3 | % | (1,086 | ) | 0.3 | % | ||||||||
Total underwriting (loss) / gain
|
(9,914 | ) | 100.8 | % | 3,796 | 96.8 | % | |||||||||
INVESTMENT
|
||||||||||||||||
Net investment income earned
|
35,495 | 33,330 | ||||||||||||||
Net realized gain
|
7,215 | 1,212 | ||||||||||||||
Total income before income tax
|
32,796 | 38,338 | ||||||||||||||
Federal income tax expense
|
5,845 | 15,935 | ||||||||||||||
Net income
|
$ | 26,951 | 22,403 | |||||||||||||
Policyholders' Surplus
|
||||||||||||||||
Surplus, beginning of period
|
$ | 1,256,431 | 1,050,107 | |||||||||||||
Net income
|
26,951 | 22,403 | ||||||||||||||
Change in deferred taxes
|
(1,282 | ) | 254 | |||||||||||||
Change in unrealized gains
|
(1,312 | ) | 9,436 | |||||||||||||
Dividends to stockholders
|
(14,376 | ) | (12,120 | ) | ||||||||||||
Paid in surplus
|
- | 57,125 | ||||||||||||||
Change in non-admitted assets
|
(2,900 | ) | 16,719 | |||||||||||||
Change in Overfunded Contra Asset
|
(1,547 | ) | (8,723 | ) | ||||||||||||
Qual Pen Transitional Liability
|
1,816 | (35,725 | ) | |||||||||||||
Excess Plan Transitional Liability
|
8 | (595 | ) | |||||||||||||
PRL Plan Transitional Liability
|
6 | (1,218 | ) | |||||||||||||
Change in minimum pension liability
|
- | 54,755 | ||||||||||||||
Surplus adjustments
|
- | (459 | ) | |||||||||||||
Net change in surplus for period
|
7,364 | 101,852 | ||||||||||||||
Surplus, end of period
|
$ | 1,263,795 | 1,151,959 | |||||||||||||
Statutory underwriting (loss) / gain
|
$ | (9,914 | ) | 3,796 | ||||||||||||
Adjustments under GAAP:
|
||||||||||||||||
Deferred policy acquisition costs
|
4,697 | 2,962 | ||||||||||||||
Pension costs
|
(98 | ) | 5,925 | |||||||||||||
Other, net
|
300 | (522 | ) | |||||||||||||
GAAP underwriting (loss) / gain
|
$ | (5,015 | ) | 12,161 | ||||||||||||
Note: Some amounts or ratios may not foot due to rounding
Selective Insurance Group, Inc. and Consolidated Subsidiaries
Alternative Investments
as of March 31, 2014
(unaudited)
Fund
|
Inception
Year |
Original
Commitment |
Remaining
Commitment |
Current
Market Value |
YTD
Income |
DPI(1)
Ratio |
TVPI(2)
Ratio |
||||||||||||||||||
Real Estate
|
|||||||||||||||||||||||||
Silverpeak RE II
|
2005
|
20,000,000 | 2,231,312 | 7,892,834 | 789,773 | 0.66 | 1.04 | ||||||||||||||||||
Silverpeak RE III
|
2008
|
15,000,000 | 7,946,585 | 2,834,766 | 48,647 | 0.04 | 0.44 | ||||||||||||||||||
Total - Real Estate
|
35,000,000 | 10,177,897 | 10,727,600 | 838,420 | 0.51 | 0.89 | |||||||||||||||||||
Mezzanine Financing
|
|||||||||||||||||||||||||
Neovara Euro Mezz
|
2004
|
9,000,000 | - | 579,578 | - | 0.98 | 1.02 | ||||||||||||||||||
GS Mezz V
|
2007
|
25,000,000 | 10,223,976 | 8,954,028 | 171,717 | 0.80 | 1.28 | ||||||||||||||||||
New Canaan V
|
2012
|
7,000,000 | 2,737,318 | 3,513,687 | - | 0.21 | 1.03 | ||||||||||||||||||
Centerfield Capital
|
2012
|
3,000,000 | 2,077,118 | 784,151 | - | 0.08 | 0.93 | ||||||||||||||||||
Total - Mezz. Financing
|
44,000,000 | 15,038,413 | 13,831,444 | 171,717 | 0.78 | 1.15 | |||||||||||||||||||
Distressed Debt
|
|||||||||||||||||||||||||
Varde VIII
|
2006
|
10,000,000 | - | 3,733,284 | 161,223 | 0.94 | 1.31 | ||||||||||||||||||
Distressed Managers III
|
2007
|
15,000,000 | 2,971,201 | 7,149,079 | 438,134 | 0.68 | 1.21 | ||||||||||||||||||
Total - Distressed Debt
|
25,000,000 | 2,971,201 | 10,882,363 | 599,357 | 0.79 | 1.25 | |||||||||||||||||||
Private Equity
|
|||||||||||||||||||||||||
Prospector
|
1997
|
5,000,000 | - | 410,408 | - | 2.79 | 2.88 | ||||||||||||||||||
Trilantic Capital Partners III
|
2004
|
10,000,000 | 1,407,833 | 2,819,472 | 379,308 | 1.61 | 1.91 | ||||||||||||||||||
NB Co-Invest
|
2006
|
15,000,000 | 1,509,887 | 6,546,602 | (25,892 | ) | 0.90 | 1.35 | |||||||||||||||||
Trilantic Capital Partners IV
|
2007
|
11,098,351 | 1,315,089 | 10,316,670 | 1,002,260 | 0.83 | 1.78 | ||||||||||||||||||
Trilantic Capital Partners V
|
2012
|
7,000,000 | 5,726,392 | 1,023,974 | (15,419 | ) | - | 0.81 | |||||||||||||||||
Total - Private Equity
|
48,098,351 | 9,959,201 | 21,117,126 | 1,340,256 | 1.25 | 1.76 | |||||||||||||||||||
Private Equity, Secondary Market
|
|||||||||||||||||||||||||
NB SOF
|
2005
|
12,000,000 | 899,494 | 3,483,546 | 104,523 | 1.02 | 1.33 | ||||||||||||||||||
Vintage IV
|
2007
|
20,000,000 | 4,118,809 | 12,188,457 | 196,584 | 0.70 | 1.32 | ||||||||||||||||||
NB SOF II
|
2008
|
12,000,000 | 1,460,427 | 7,922,678 | 365,615 | 0.80 | 1.46 | ||||||||||||||||||
Total - Pvt. Eq. Sec. Mkt.
|
44,000,000 | 6,478,731 | 23,594,681 | 666,723 | 0.81 | 1.36 | |||||||||||||||||||
Energy/Power Generation
|
|||||||||||||||||||||||||
ArcLight I
|
2002
|
15,000,000 | - | 93,901 | (36,913 | ) | 1.80 | 1.81 | |||||||||||||||||
ArcLight II
|
2003
|
15,000,000 | 2,295,492 | 1,083,383 | 74,826 | 1.38 | 1.44 | ||||||||||||||||||
ArcLight III
|
2006
|
15,000,000 | 2,037,794 | 5,926,740 | 173,388 | 1.00 | 1.37 | ||||||||||||||||||
Quintana Energy
|
2006
|
10,000,000 | 362,821 | 8,122,471 | 854,933 | 0.55 | 1.39 | ||||||||||||||||||
ArcLight IV
|
2007
|
10,000,000 | 2,287,578 | 2,751,298 | 534,805 | 1.05 | 1.32 | ||||||||||||||||||
Total - Energy/Power Generation
|
65,000,000 | 6,983,685 | 17,977,793 | 1,601,039 | 1.23 | 1.49 | |||||||||||||||||||
Venture Capital
|
|||||||||||||||||||||||||
Venture V
|
2001
|
9,600,000 | 350,000 | 7,019,233 | - | 0.54 | 1.30 | ||||||||||||||||||
Total - Venture Capital
|
9,600,000 | 350,000 | 7,019,233 | - | 0.54 | 1.30 | |||||||||||||||||||
TOTAL - ALTERNATIVE INVESTMENTS
|
$ | 270,698,351 | 51,959,127 | 105,150,241 | 5,217,511 | 0.95 | 1.37 | ||||||||||||||||||
(1) Distributed to paid in ratio
|
|||||||||||||||||||||||||
(2) Total value to paid in ratio
|
|||||||||||||||||||||||||
Exhibit may not foot due to rounding
|
Selective Insurance Group, Inc. and Consolidated Subsidiaries
Credit Quality of Available-for-Sale Fixed Income Securities
March 31, 2014
(Unaudited)
($ in millions)
|
Fair
Value
|
Unrealized
Gain
(Loss)
|
Average
Credit
Quality
|
||||||||
AFS Fixed Income Portfolio:
|
|||||||||||
U.S. government obligations
|
$ | 171.1 | 9.6 |
AA+
|
|||||||
Foreign government obligations
|
32.4 | 0.9 |
AA-
|
||||||||
State and municipal obligations
|
979.2 | 15.9 |
AA+
|
||||||||
Corporate securities
|
1,815.7 | 38.5 | A | ||||||||
Asset-backed securities (“ABS”)
|
131.9 | 0.5 |
AAA
|
||||||||
Mortgage-backed securities (“MBS”)
|
685.6 | 1.9 |
AA+
|
||||||||
Total AFS fixed income portfolio
|
$ | 3,815.9 | 67.3 |
AA-
|
|||||||
State and Municipal Obligations:
|
|||||||||||
General obligations
|
$ | 478.6 | 7.2 |
AA+
|
|||||||
Special revenue obligations
|
500.6 | 8.7 |
AA
|
||||||||
Total state and municipal obligations
|
$ | 979.2 | 15.9 |
AA+
|
|||||||
Corporate Securities:
|
|||||||||||
Financial
|
$ | 568.5 | 13.2 | A | |||||||
Industrials
|
135.9 | 4.4 | A- | ||||||||
Utilities
|
155.1 | 1.7 | A- | ||||||||
Consumer discretionary
|
213.9 | 5.1 | A- | ||||||||
Consumer staples
|
176.4 | 3.7 | A | ||||||||
Healthcare
|
174.7 | 4.2 | A | ||||||||
Materials
|
104.1 | 2.3 | A- | ||||||||
Energy
|
104.2 | 1.7 | A- | ||||||||
Information technology
|
125.5 | 0.7 | A+ | ||||||||
Telecommunications services
|
50.0 | 1.1 |
BBB+
|
||||||||
Other
|
7.4 | 0.4 |
AA+
|
||||||||
Total corporate securities
|
$ | 1,815.7 | 38.5 | A | |||||||
ABS:
|
|||||||||||
ABS
|
$ | 131.5 | 0.5 |
AAA
|
|||||||
Sub-prime ABS1
|
0.4 | — | D | ||||||||
Total ABS
|
$ | 131.9 | 0.5 |
AAA
|
|||||||
MBS:
|
|||||||||||
Government guaranteed agency commercial MBS (“CMBS”)
|
$ | 24.5 | 0.5 |
AA+
|
|||||||
Other agency CMBS
|
10.6 | (0.2 | ) |
AA+
|
|||||||
Non-agency CMBS
|
139.7 | 2.1 |
AA+
|
||||||||
Government guaranteed agency residential MBS (“RMBS”)
|
48.3 | 1.3 |
AA+
|
||||||||
Other agency RMBS
|
417.6 | (2.3 | ) |
AA+
|
|||||||
Non-agency RMBS
|
40.5 | 0.4 | A- | ||||||||
Alternative-A (“Alt-A”) RMBS
|
4.4 | 0.1 | A | ||||||||
Total MBS
|
$ | 685.6 | 1.9 |
AA+
|
1Subprime ABS consists of one security whose issuer is currently expected by rating agencies to default on its obligations. We define sub-prime exposure as exposure to direct and indirect investments in non-agency residential mortgages with average FICO® scores below 650.
Selective Insurance Group, Inc. and Consolidated Subsidiaries
Credit Quality of Held-to-Maturity Fixed Income Securities
March 31, 2014
(Unaudited)
($ in millions)
|
Fair
Value
|
Carry
Value
|
Unrecognized
Holding Gain
|
Unrealized
Gain (Loss) in
Accumulated
Other
Comprehensive
Income
|
Total
Unrealized/
Unrecognized
Gain
|
Average
Credit
Quality
|
|||||||||||||||||
HTM Fixed Income Portfolio:
|
|||||||||||||||||||||||
Foreign government obligations
|
$ | 5.6 | 5.4 | 0.2 | 0.1 | 0.3 |
AA+
|
||||||||||||||||
State and municipal obligations
|
364.3 | 347.9 | 16.4 | 3.4 | 19.8 |
AA
|
|||||||||||||||||
Corporate securities
|
24.5 | 21.6 | 2.9 | (0.3 | ) | 2.6 | A+ | ||||||||||||||||
ABS
|
3.3 | 2.7 | 0.6 | (0.6 | ) | — |
AA+
|
||||||||||||||||
MBS
|
5.8 | 4.5 | 1.3 | (0.8 | ) | 0.5 |
AAA
|
||||||||||||||||
Total HTM fixed income portfolio
|
$ | 403.5 | 382.1 | 21.4 | 1.8 | 23.2 |
AA
|
||||||||||||||||
State and Municipal Obligations:
|
|||||||||||||||||||||||
General obligations
|
$ | 117.5 | 112.6 | 4.9 | 1.7 | 6.6 |
AA
|
||||||||||||||||
Special revenue obligations
|
246.8 | 235.3 | 11.5 | 1.7 | 13.2 |
AA
|
|||||||||||||||||
Total state and municipal obligations
|
$ | 364.3 | 347.9 | 16.4 | 3.4 | 19.8 |
AA
|
||||||||||||||||
Corporate Securities:
|
|||||||||||||||||||||||
Financial
|
$ | 2.3 | 1.9 | 0.4 | (0.1 | ) | 0.3 | A- | |||||||||||||||
Industrials
|
7.1 | 6.0 | 1.1 | (0.2 | ) | 0.9 | A+ | ||||||||||||||||
Utilities
|
13.6 | 12.2 | 1.4 | — | 1.4 | A+ | |||||||||||||||||
Consumer discretionary
|
1.5 | 1.5 | — | — | — |
AA
|
|||||||||||||||||
Total corporate securities
|
$ | 24.5 | 21.6 | 2.9 | (0.3 | ) | 2.6 | A+ | |||||||||||||||
ABS:
|
|||||||||||||||||||||||
ABS
|
$ | 0.8 | 0.8 | — | — | — |
AA
|
||||||||||||||||
Alt-A ABS
|
2.5 | 1.9 | 0.6 | (0.6 | ) | — |
AAA
|
||||||||||||||||
Total ABS
|
$ | 3.3 | 2.7 | 0.6 | (0.6 | ) | — |
AA+
|
|||||||||||||||
MBS:
|
|||||||||||||||||||||||
Non-agency CMBS
|
$ | 5.8 | 4.5 | 1.3 | (0.8 | ) | 0.5 |
AAA
|
|||||||||||||||
Total MBS
|
$ | 5.8 | 4.5 | 1.3 | (0.8 | ) | 0.5 |
AAA
|