SELECTIVE INSURANCE GROUP INC

Previous wording

We write our Standard Commercial and Standard Personal Lines products and services through nine of our insurance subsidiaries, some of which participate in the federal government's National Flood Insurance Program's ("NFIP") Write Your Own Program. We write our E&S products through another subsidiary, Mesa Underwriters Specialty Insurance Company, a nationally-authorized non-admitted platform for customers who generally cannot obtain coverage in the standard marketplace. Collectively, we refer to our ten insurance subsidiaries as the "Insurance Subsidiaries."

Current wording

We write our Standard Commercial and Standard Personal Lines products and services through nine of our insurance subsidiaries, some of which participate in the federal government's National Flood Insurance Program's ("NFIP") Write Your Own Program. We write our E&S products through another subsidiary, Mesa Underwriters Specialty Insurance Company, a nationally authorized non-admitted carrier for customers who generally cannot obtain coverage in the standard marketplace. Collectively, we refer to our ten insurance subsidiaries as the "Insurance Subsidiaries."

Previous wording

Financial Highlights of Results for First Quarter 2025 and First Quarter 20241

Current wording

Financial Highlights of Results for Second Quarter and Six Months 2025 and Second Quarter and Six Months 20241

Previous wording

We continue to price new and renewal business incorporating our latest view of loss trends and profitability relative to our 95% combined ratio target. In First Quarter 2025, overall renewal pure pricing across our three insurance segments was 10.3%, up 2.2 points from a year ago. We believe our actions in 2024 and the continued execution of our strategy in 2025 position us well despite elevated uncertainty in the macroeconomic environment.

Current wording

•Achieving renewal pure price increases above expected loss trend. We continue to price new and renewal business incorporating our latest view of loss trends and profitability relative to our long-term combined ratio target of 95%. In Six Months 2025, overall renewal pure pricing across our three insurance segments was 10.1%, up 1.5 points from a year ago.

Previous wording

•In our existing footprint, we are focused on growing with existing partners and strategically appointing new agency locations. In First Quarter 2025, we added thirty agency locations. In full-year 2024, we had a net increase of two hundred agency locations.

Current wording

•In our existing footprint, we are focused on growing with existing partners and strategically appointing new agency locations. During Six Months 2025, we added sixty agency locations. In full-year 2024, we had a net increase of two hundred agency locations.

Previous wording

•Careful and deliberate geographic expansion continues to provide growth opportunities. Since 2017, we have added thirteen states to our Standard Commercial Lines footprint, with five last year. In 2024 these thirteen states produced $350 million in premium, which represented approximately 10% of Standard Commercial Lines NPW and approximately 2% marginal premium growth. We expect to write new business in Kansas, Montana, and Wyoming by the end of 2026.

Current wording

•Careful and deliberate geographic expansion continues to provide growth opportunities. Since 2017, we have added thirteen states to our Standard Commercial Lines footprint, with five last year. In 2024, these thirteen states produced $350 million in premium, which represented approximately 8% of total NPW and approximately 1% marginal total premium growth. We expect to write new business in Kansas by the end of 2025, and in Montana and Wyoming by the end of 2026.

Previous wording

•Technology investments are critical to ensure efficiency and scale. We are actively developing and executing artificial intelligence use cases focused on underwriting scalability and improving claims outcomes. We have also made considerable progress modernizing our policy acquisition and claims systems. For example, system enhancements in our E&S Lines segment have created significant operational efficiency, with the segment’s premium production up significantly with limited headcount growth.

Current wording

•Technology investments are critical to ensure efficiency and scale. We are actively developing and executing artificial intelligence use cases to enhance underwriting scalability and claims outcomes. We have also made considerable progress modernizing our policy acquisition and claims systems. For example, system enhancements in our E&S Lines segment have created significant operational efficiency, with the segment’s premium production up significantly with limited headcount growth.

Previous wording

After contemplating First Quarter 2025 results, we are reaffirming our full-year 2025 guidance as follows:

Current wording

After contemplating Six Months 2025 results, our full-year 2025 guidance is as follows:

Previous wording

•A GAAP combined ratio between 96% and 97%, including net catastrophe losses of 6 points. Consistent with our longstanding practice, our combined ratio estimate assumes no additional prior year casualty reserve development;

Current wording

•A GAAP combined ratio between 97% and 98%, up 1 point from prior guidance of 96% to 97%, including net catastrophe losses of 6 points and the impact of prior year casualty reserve development reported through Six Months 2025. Our combined ratio estimate assumes no additional prior year casualty reserve development and no further change in loss cost estimates. We do not make assumptions about future reserve development as we book our best estimate each quarter;

Previous wording

•Weighted average shares of 61.5 million on a fully diluted basis, including the common shares repurchased in First Quarter 2025 and assuming no additional repurchases under our existing share repurchase authorization.

Current wording

•Weighted average shares of 61.5 million on a fully diluted basis, including the shares repurchased in Six Months 2025 and assuming no additional repurchases under our existing share repurchase authorization.

Previous wording

The reduction in unfavorable prior year reserve development was partially offset by higher current year casualty loss costs. The increase in current year loss costs in First Quarter 2025 compared to First Quarter 2024 was primarily due to increased severities related to social inflation on our general liability and E&S casualty lines of business.

Current wording

The reduction in the prior year casualty reserve development was partially offset by higher current year loss costs in Second Quarter 2025 and Six Months 2025 compared to the same prior-year periods, driven by elevated severity trend assumptions attributable to social inflation on our general liability and E&S casualty lines of business.

Previous wording

Net catastrophe and non-catastrophe property losses reduced the loss and loss expense ratio by 2.5 points in the aggregate in First Quarter 2025 compared to First Quarter 2024. The net catastrophe loss and loss expense ratio was 1.6 points lower in First Quarter 2025 compared to First Quarter 2024, as fewer and less severe storms impacted our footprint. The non-catastrophe property loss and loss expense ratio was 0.9 points lower in First Quarter 2025 compared to First Quarter 2024, reflecting (i) the earned impact of higher renewal pure price increases in 2025, (ii) lower claim frequencies, and (iii) normal variability from period to period of non-catastrophe weather.

Current wording

Net catastrophe and non-catastrophe property losses reduced the loss and loss expense ratio by 4.3 points in Second Quarter 2025 and 3.2 points in Six Months 2025 compared to the same prior-year periods. The net catastrophe loss and loss expense ratio was 1.7 points lower in Second Quarter 2025 and 1.5 points lower in Six Months 2025 compared to the same prior-year periods, as fewer storms impacted our footprint. The non-catastrophe property loss and loss expense ratio was 2.6 points lower in Second Quarter 2025 and 1.7 points lower in Six Months 2025 compared to the same prior-year periods, reflecting (i) the earned impact of higher renewal pure price increases in 2025, (ii) lower claim frequencies, and (iii) normal variability from period to period of non-catastrophe property losses.

Previous wording

The reduction in unfavorable prior year reserve development was partially offset by higher current year casualty loss costs. The increase in current year casualty loss costs in First Quarter 2025 compared to First Quarter 2024 was primarily due to increased severities related to social inflation.

Current wording

The reduction in unfavorable prior year reserve development in Second Quarter 2025 and Six Months 2025 was partially offset by higher current year casualty loss costs. The increase in current year casualty loss costs in Second Quarter 2025 and Six Months 2025 compared to the same prior-year periods was primarily driven by higher loss trend expectations and increased claim severities, which we attribute to the continued impacts of social inflation. Prior-year severities developed adversely over the course of 2024 and impacted our view of current year loss costs for 2025, resulting in higher current year casualty loss costs this year compared to last.

Previous wording

A discussion of our most significant Standard Commercial Lines of business follows:

Current wording

Information about our most significant Standard Commercial Lines of business follows:

Previous wording

We did not record any prior year casualty reserve development in First Quarter 2025. The unfavorable prior year casualty reserve development in First Quarter 2024 was primarily due to social inflation, which resulted in higher severities in accident years 2023 and prior. The general liability line of business has experienced a long-term historical trend of meaningful severity increases, partially offset by claim frequency decreases. Prior-year severities developed adversely, which extended into more recent accident years in 2024 after previously impacting the pre-pandemic period. We attribute the increased severities to elevated social inflation, which we view as an industry dynamic characterized by higher claimant propensity for attorney representation and litigation, longer settlement times, and higher settlement values. Certain jurisdictions with expanded liability theories and higher damage awards pose increased challenges. We are closely monitoring these jurisdictions and the broader trends across our business.

Current wording

The general liability line of business has experienced a long-term historical trend of meaningful severity increases, partially offset by claim frequency decreases. Prior-year severities developed adversely, which have impacted our view of more recent accident years in 2024 and 2025. We attribute the increased severities to elevated social inflation, which we view as an industry dynamic characterized by higher claimant propensity for attorney representation and litigation, longer settlement times, and higher settlement values. Certain jurisdictions with expanded liability theories and higher damage awards pose increased challenges. We are closely monitoring these jurisdictions and the broader trends across our business.

Previous wording

Partially offsetting the decrease in unfavorable prior year casualty reserve development was an increase in current year casualty loss costs of 12.0 points in First Quarter 2025 compared to First Quarter 2024, primarily driven by higher severities due to social inflation in the more recent accident years that was observed and responded to during the course of 2024. These actions produced full-year 2024 casualty loss costs of 67.0%, compared with 60.5% in First Quarter 2024. The 2025 ratio reflects the increase recognized in the 2024 accident year, as well as elevated loss trend expectations for the line.

Current wording

Partially offsetting the decrease in unfavorable prior year casualty reserve development was a 3.0-point increase in current year casualty loss costs in Second Quarter 2025 and a 7.5-point increase in Six Months 2025 compared to the same prior-year periods, driven by higher social inflation-related severities primarily in accident years 2022 and 2023 than was observed and responded to throughout 2024. These actions produced full-year 2024 casualty loss costs of 67.0%, compared with 69.2% in Second Quarter 2024 and 64.9% in Six Months 2024. The 2025 ratio reflects the increased losses recognized in the 2024 accident year and elevated loss trend expectations.

Previous wording

We believe that social inflation and elevated loss trends are an industry dynamic, which we expect to continue to support an elevated near-term pricing environment. Given the consistency in our underwriting appetite and risk profile over time, we have focused primarily on prudent underwriting and appropriate pricing. Our renewal pure price increase in this line of business accelerated to 12.0% in First Quarter 2025, up from 10.6% last quarter, and 8.6% for full-year 2024.

Current wording

We believe that social inflation and elevated loss trends continue to support an elevated near-term pricing environment. In response, we have a heightened focus on prudent underwriting and appropriate pricing. Our renewal pure price increase in this line of business was 11.9% in Second Quarter 2025, in line with 12.0% from last quarter and up from 10.6% for the fourth quarter of 2024. In sectors and jurisdictions where market pricing does not align with our view of rate need, we are taking targeted underwriting actions including (i) revising underwriting guidelines, (ii) tightening coverage offerings, and (iii) reducing writings.

Previous wording

The underwriting expense ratio increased 1.2 points in First Quarter 2025 compared to First Quarter 2024, as discussed in the "Total Standard Commercial Lines" section above.

Current wording

The underwriting expense ratio increased 0.7 points in Second Quarter 2025 and 1.0 points in Six Months 2025 compared to the same prior-year periods, as discussed in the "Total Standard Commercial Lines" section above.

Previous wording

NPW grew 12% in First Quarter 2025 compared to First Quarter 2024, primarily benefiting from renewal pure price increases, stable retention, and exposure growth on renewal policies.

Current wording

NPW grew 6% in Second Quarter 2025 and 9% in Six Months 2025 compared to the same prior-year periods, primarily benefiting from renewal pure price increases and exposure growth on renewal policies.

Previous wording

Net catastrophe losses were lower in First Quarter 2025 compared to First Quarter 2024, as discussed in the "Standard Commercial Lines Segment" section above.

Current wording

While non-catastrophe property losses were slightly higher, net catastrophe losses were lower in Second Quarter 2025 and Six Months 2025 compared to the same prior-year periods, as discussed in the "Standard Commercial Lines Segment" section above.

Previous wording

NPW decreased 13% in First Quarter 2025 compared to First Quarter 2024, primarily due to decreases in renewal pure price and direct new business.

Current wording

NPW decreased 2% in Second Quarter 2025 and 8% in Six Months 2025 compared to the same prior-year periods, primarily due to decreases in renewal pure price and direct new business.

Previous wording

There was no prior year casualty reserve development in First Quarter 2025. The favorable prior year casualty reserve development in First Quarter 2024 was primarily due to improved loss severities in accident years 2021 and prior.

Current wording

There was no prior year casualty reserve development in Second Quarter 2025 and Six Months 2025. The favorable prior year casualty reserve development in Six Months 2024 was primarily due to lower loss severities in accident years 2021 and prior.

Previous wording

In First Quarter 2025, the combined ratio was adversely impacted by an increase in current year casualty loss costs of 8.5 points, primarily driven by loss trend outpacing rate level reductions. These rate level reductions are driven by continued decreases in workers compensation rating bureau loss costs, which we use to supplement our data in determining premium rates for this line of business.

Current wording

The combined ratio was also adversely impacted by an increase in current year casualty loss costs of 7.6 points in Second Quarter 2025 and 8.2 points in Six Months 2025, primarily driven by negative rate changes combined with positive loss trends. These rate level reductions are driven by continued decreases in workers compensation rating bureau loss costs, which form the basis for our filed rating plans, and heavily influence marketplace pricing for this line of business.

Previous wording

NPW decreased 12% in First Quarter 2025 compared to First Quarter 2024. The decrease in First Quarter 2025 compared to First Quarter 2024 was primarily due to direct new business and retention reductions, partially offset by renewal pure price increases and higher average policy sizes from our mass affluent market strategy. New business decreased 58% and new policy counts decreased 68% in First Quarter 2025 compared to First Quarter 2024 as we focused on growth in states where our rate levels are adequate, and where we anticipate profitable growth. We have also significantly curtailed production, including restricting new business in certain states, like New Jersey, our biggest market, where filed rates do not support a path to profitability. The following table depicts our reductions in direct new business and retention:

Current wording

NPW decreased 5% in Second Quarter 2025 and 8% in Six Months 2025 compared to the same prior-year periods, driven primarily by direct new business reductions. New business decreased 41% in Second Quarter 2025 and 50% in Six Months 2025 compared to the same prior-year periods. New policy counts decreased 54% in Second Quarter 2025 and 61% in Six Months 2025 compared to the same prior-year periods, as we focused on growth in states where our rate levels are adequate and narrowed our appetite to mass affluent market business. We have also significantly curtailed production, including restricting new business in certain states, like New Jersey, our biggest market, where we believe our filed rates do not support profitability. The following table depicts our reductions in direct new business and retention for the Second Quarter 2025 and Six Months 2025:

Previous wording

We are taking actions to improve the profitability of this business, refine our pricing factors, and prioritize rate filings to mitigate inflationary impacts. Our more significant rate increases began to take effect early in 2023 and increased in number and magnitude through 2024. We expect 2025 rate changes to remain above loss trends but moderate compared to our rate increases in 2024. Directly related to our actions, we achieved a renewal pure price increase of 24.1% in First Quarter 2025. We also are continuing to seek improved homeowners profitability by expanding the use of new policy terms and conditions, including (i) coverage for older roofs based on a schedule of factors rather than replacement cost and (ii) where allowed by law, mandatory wind/hail deductibles in states exposed to severe convective storms.

Current wording

We are seeing profitability improvements in this line of business, as we are obtaining positive results from the actions we took to refine our pricing factors and prioritize rate filings to mitigate inflationary impacts. Our more significant rate increases began to take effect early in 2023 and increased in number and magnitude throughout 2024. We expect 2025 rate changes to remain above loss trends but moderate compared to our 2024 rate increases. Through our actions, we achieved renewal pure price increases of 19.0% in Second Quarter 2025 and 21.3% in Six Months 2025. We are continuing to seek improved homeowners profitability by expanding the use of new policy terms and conditions, including (i) coverage for roofs based on a depreciated value considering the age of the roof rather than full replacement cost and (ii) where allowed by law, mandatory wind/hail deductibles in states exposed to severe convective storms.

Previous wording

The change in NPE in First Quarter 2025 compared to First Quarter 2024 resulted from the same impacts to NPW described above.

Current wording

The change in NPE in Second Quarter 2025 and Six Months 2025 compared to the same prior-year periods resulted from the same impacts to NPW described above.

Previous wording

Net catastrophe and non-catastrophe property losses reduced the loss and loss expense ratio by 9.6 points in the aggregate in First Quarter 2025 compared to First Quarter 2024. Non-catastrophe property loss and loss expense ratios were lower in First Quarter 2025 compared to First Quarter 2024 due to (i) the earned impact of higher renewal pure price increases in 2025 and (ii) variability from period to period of catastrophe and non-catastrophe losses. Net catastrophe losses were lower in First Quarter 2025 compared to First Quarter 2024 due to lower frequency and severity of events this year compared to the same prior-year period.

Current wording

Net catastrophe and non-catastrophe property losses reduced the loss and loss expense ratio by an aggregate 24.6 points in Second Quarter 2025 and 17.3 points in Six Months 2025 compared to the same prior-year periods. Non-catastrophe property loss and loss expense ratios were lower in Second Quarter 2025 and Six Months 2025 compared to the same prior-year periods due to (i) the earned impact of higher renewal pure price increases in 2025 and (ii) period-to-period variability of catastrophe and non-catastrophe losses. Net catastrophe losses were lower in Second Quarter 2025 and Six Months 2025 compared to the same prior-year periods due to lower frequency and severity of weather-related catastrophe events this year compared to last year.

Previous wording

Prior year casualty reserve development in First Quarter 2025 included $5.0 million in personal automobile, primarily driven by increased severities in accident year 2024. Our homeowners line of business experienced $5.0 million of favorable prior year casualty reserve development in First Quarter 2024, primarily due to lower loss severities in accident years 2021 and prior. This favorable development was offset by $5.0 million of unfavorable prior year casualty reserve development on our personal automobile line of business in First Quarter 2024, primarily driven by increased loss severities in accident years 2021 through 2023.

Current wording

Unfavorable prior year casualty reserve development in Six Months 2025 included $5.0 million in personal automobile, primarily driven by increased severities in accident year 2024. In Six Months 2024, prior year casualty reserve development reflected (i) $5.0 million of favorable development in our homeowners line, primarily due to lower loss severities in accident years 2021 and prior, offset by (ii) $5.0 million of unfavorable development on our personal automobile line of business, primarily driven by increased loss severities in accident years 2021 through 2023.

Previous wording

Current year casualty loss costs decreased 2.5 points in First Quarter 2025 compared to First Quarter 2024, primarily due to the earned impact of significant rate increases.

Current wording

Current year casualty loss costs decreased 2.4 points in Second Quarter 2025 and 2.2 points in Six Months 2025 compared to the same prior-year periods, primarily due to the earned impact of rate increases.

Previous wording

NPW and NPE growth in First Quarter 2025 also benefited from (i) both property and casualty exposure growth on renewal policies, (ii) higher rates per exposure, and (iii) higher new business production.

Current wording

NPW and NPE growth in Second Quarter 2025 and Six Months 2025 benefited from (i) both property and casualty exposure growth on renewal policies and (ii) higher rates per exposure.

Previous wording

The effective duration of our fixed income and short-term investments was 4.1 years as of March 31, 2025. We monitor and manage the effective duration to maximize yield while managing interest rate risk at an acceptable level. We buy and sell investments with the intent of maximizing investment returns in the current market environment, while balancing capital preservation and ensuring adequate liquidity to support our insurance business.

Current wording

The effective duration of our fixed income and short-term investments was 4.2 years as of June 30, 2025. We monitor and manage the effective duration to maximize yield while managing interest rate risk at an acceptable level. We buy and sell investments with the intent of maximizing investment returns in the current market environment, while balancing capital preservation and ensuring adequate liquidity to support our insurance business.

Previous wording

Our fixed income and short-term investments represented 92% of invested assets at March 31, 2025 and December 31, 2024. These investments had (i) a weighted average credit rating of "A+" as of March 31, 2025 and December 31, 2024, and (ii) investment grade holdings representing 97% of the total fixed income and short-term investment portfolio at March 31, 2025 and December 31, 2024.

Current wording

Our fixed income and short-term investments represented 92% of invested assets at June 30, 2025 and December 31, 2024. These investments had (i) a weighted average credit rating of "A+" as of both June 30, 2025 and December 31, 2024, and (ii) investment grade holdings representing 96% of the total fixed income and short-term investment portfolio at June 30, 2025, and 97% at December 31, 2024.

Previous wording

Invested assets increased $644.0 million at March 31, 2025, compared to December 31, 2024, primarily reflecting: (i) net proceeds from the issuance of our 5.9% Senior Notes in First Quarter 2025; (ii) our active investment of operating cash flows, which were 23% of NPW in First Quarter 2025; and (iii) pre-tax net unrealized gains in our fixed income and equity securities portfolios of $82.2 million due to a reduction in interest rates and strong performance of U.S. equities during First Quarter 2025. For additional information about our 5.9% Senior Notes, see Note 12. "Indebtedness" in Item 1. "Financial Statements" of this Form 10-Q.

Current wording

Invested assets increased $902.3 million at June 30, 2025, compared to December 31, 2024, primarily reflecting (i) net proceeds from the issuance of our 5.9% Senior Notes in the first quarter of 2025, (ii) our active investment of operating cash flows, which were 18% of NPW in Six Months 2025, and (iii) a $137.4 million reduction in pre-tax net unrealized losses in our fixed income and equity securities portfolios from lower interest rates and strong performance of U.S. equities during Six Months 2025. For additional information about our 5.9% Senior Notes, see Note 12. "Indebtedness" in Item 1. "Financial Statements" of this Form 10-Q.

Previous wording

After-tax net investment income earned increased 12% in First Quarter 2025 compared to First Quarter 2024, primarily driven by active portfolio management, operating cash flow deployment, and net proceeds from the issuance of our 5.9% Senior Notes in First Quarter 2025. For additional information about our 5.9% Senior Notes, see Note 12. "Indebtedness" in Item 1. "Financial Statements" of this Form 10-Q.

Current wording

After-tax net investment income earned increased 18% in Second Quarter 2025 and 15% in Six Months 2025 compared to the same prior-year periods, primarily driven by active portfolio management, operating cash flow deployment, and net proceeds from the issuance of our 5.9% Senior Notes in the first quarter of 2025. For additional information about our 5.9% Senior Notes, see Note 12. "Indebtedness" in Item 1. "Financial Statements" of this Form 10-Q.

Previous wording

The following table provides information regarding federal income taxes and reconciles federal income tax at the corporate rate to the effective tax rate:

Current wording

The following table provides information about federal income taxes and reconciles federal income tax at the corporate rate to the effective tax rate:

Previous wording

The Insurance Subsidiaries generate liquidity through insurance float, created by collecting premiums and earning investment income before paying claims. Given the long payment patterns of certain claims, the period of float can extend over many years. Our investment portfolio consists of securities with maturity dates that continually provide a source of cash flow for claims payments in the ordinary course of business. To protect our Insurance Subsidiaries' capital, we purchase reinsurance coverage for significantly large claims or catastrophes that may occur.

Current wording

The Insurance Subsidiaries generate liquidity through insurance float, created by collecting premiums and earning investment income before paying claims. Given the long payment patterns of certain claims, the float period can extend over many years. Our investment portfolio consists of securities with maturity dates that continually provide a source of cash flow for claims payments in the ordinary course of business. To protect our Insurance Subsidiaries' capital, we purchase reinsurance coverage for significantly large claims or catastrophes that may occur.

Previous wording

From time to time, our Insurance Subsidiaries pay dividends to the Parent company. The Insurance Subsidiaries did not declare or pay cash dividends to the Parent in First Quarter 2025. As of December 31, 2024, our allowable ordinary maximum dividend is $290 million for 2025. All Insurance Subsidiary dividends to the Parent are (i) subject to the approval and/or review of its domiciliary state insurance regulator and (ii) generally payable only from earned statutory surplus reported in its annual statements as of the preceding December 31. Although domiciliary state insurance regulators have historically approved dividends, there is no assurance they will approve future Insurance Subsidiary dividends.

Current wording

Our Insurance Subsidiaries may pay dividends to the Parent company. The Insurance Subsidiaries did not declare or pay cash dividends to the Parent in Six Months 2025. As of December 31, 2024, our allowable ordinary maximum dividend is $290 million for 2025. All Insurance Subsidiary dividends to the Parent are (i) subject to the approval and/or review of its domiciliary state insurance regulator and (ii) generally payable only from earned statutory surplus reported in its annual statements as of the preceding December 31. Although domiciliary state insurance regulators have historically approved dividends, there is no assurance they will approve future Insurance Subsidiary dividends.

Previous wording

On November 7, 2022, the Parent entered into a Credit Agreement with the lenders named therein (the "Lenders") and Wells Fargo Bank, National Association, as Administrative Agent ("Line of Credit"). Under the Line of Credit, the Lenders have agreed to provide the Parent with a $50 million revolving credit facility that can be increased to $125 million with the Lenders' consent. No borrowings were made under the Line of Credit in First Quarter 2025. The Line of Credit will mature on November 7, 2025, and has a variable interest rate based on the Parent’s debt ratings. We expect to continue to maintain a credit facility for liquidity purposes. For additional information regarding the Line of Credit and corresponding representations, warranties, and covenants, refer to Note 11. "Indebtedness" in Item 8. "Financial Statements and Supplementary Data." of our 2024 Annual Report. We met all covenants under our Line of Credit as of March 31, 2025.

Current wording

On June 30, 2025, the Parent entered into a Credit Agreement with the lenders named therein (the "Lenders") and Wells Fargo Bank, National Association, as administrative agent ("Line of Credit"). Under the Line of Credit, the Lenders have agreed to provide the Parent with a $100 million revolving credit facility that can be increased to $200 million with the Lenders' consent. The Line of Credit will mature on June 30, 2028, and has a variable interest rate based on the Parent’s debt ratings. This agreement replaced a prior credit agreement that the Parent terminated in conjunction with entering into the Line of Credit. No borrowings were made under either credit facility in Six Months 2025. For additional information regarding the Line of Credit and corresponding representations, warranties, and covenants, see Note 12. "Indebtedness" in Item 1. "Financial Statements" of this Form 10-Q.

Previous wording

The Line of Credit permits aggregate borrowings from the FHLBI and the FHLBNY up to 10% of the respective member company’s admitted assets for the previous year. SICNY is domiciled in New York, which limits its FHLBNY borrowings to the lesser of 5% of admitted assets for the most recently completed fiscal quarter or 10% of the previous year-end's admitted assets. As of March 31, 2025, we had remaining capacity of $607.7 million for FHLB borrowings, with a $24.9 million additional stock purchase requirement to allow the member companies to borrow their remaining capacity amounts.

Current wording

The Line of Credit permits aggregate borrowings from the FHLBI and the FHLBNY up to 10% of the respective member company’s admitted assets for the previous year. SICNY is domiciled in New York, which limits its FHLBNY borrowings to the lesser of 5% of admitted assets for the most recently completed fiscal quarter or 10% of the previous year-end's admitted assets. As of June 30, 2025, we had remaining capacity of $610.0 million for FHLB borrowings, with a $25.0 million additional stock purchase requirement to allow the member companies to borrow their remaining capacity amounts.

Previous wording

We made no short-term borrowings from FHLB branches during First Quarter 2025.

Current wording

We made no short-term borrowings from FHLB branches during Six Months 2025.

Previous wording

The Parent has lending agreements with the Indiana Subsidiaries, approved by the Indiana Department of Insurance, that provide the Parent with additional intercompany liquidity. Like the Line of Credit, these lending agreements limit the Parent’s borrowings from the Indiana Subsidiaries to 10% of the admitted assets of the respective Indiana Subsidiary. The outstanding balance on these intercompany loans was $35.0 million as of March 31, 2025 and December 31, 2024. The remaining capacity under these intercompany loan agreements was $171.8 million as of March 31, 2025 and December 31, 2024. We have other insurance regulator-approved intercompany agreements that facilitate liquidity management between the Parent and the Insurance Subsidiaries to enhance flexibility.

Current wording

The Parent has lending agreements with the Indiana Subsidiaries, approved by the Indiana Department of Insurance, that provide the Parent with additional intercompany liquidity. Like the Line of Credit, these lending agreements limit the Parent’s borrowings from the Indiana Subsidiaries to 10% of the admitted assets of the respective Indiana Subsidiary. The outstanding balance on these intercompany loans was $35.0 million as of both June 30, 2025 and December 31, 2024. The remaining capacity under these intercompany loan agreements was $171.8 million as of both June 30, 2025 and December 31, 2024. We have other insurance regulator-approved intercompany agreements that facilitate liquidity management between the Parent and the Insurance Subsidiaries to enhance flexibility.