SELECTIVE INSURANCE GROUP INC

Insurance Operations

The following table provides quantitative information for analyzing the combined ratio:

Lower NPWin Second Quarter 2026 and Six Months 2026 compared to the same prior-year periods reflect reduced new business in a competitive environment and deliberate actions to enhance underwriting profitability. Retention in our Standard Commercial Lines segment was down two points in both Second Quarter 2026 and Six Months 2026, reflecting our granular pricing actions to drive lower retention on underperforming business. While enhancing underwriting profitability is a primary focus, we are also executing on strategies to support future growth opportunities, including expanding our geographic footprint and broadening our E&S distribution capabilities with retail access.

Growth in NPE of 2% in Second Quarter 2026 and 4% in Six Months 2026 compared to the same prior-year periods is decelerating as the impact of lower NPW is materializing through the earnings process.

The loss and loss expense ratio decreased 2.1 points in Second Quarter 2026 compared to Second Quarter 2025, driven by (i) lower net catastrophe and non-catastrophe property losses reflecting less severe wind and convective storms impacting our footprint and (ii) no prior year casualty reserve development in Second Quarter 2026, compared to 3.8 points of unfavorable prior year casualty reserve development in the year-ago quarter. These items were partially offset by higher current year casualty loss costs.

In Six Months 2026, the loss and loss expense ratio increased 0.2 points compared to Six Months 2025, with higher current year loss costs and catastrophe losses predominantly offset by improvements in prior year casualty reserve development and non-catastrophe property losses.

There was no prior year casualty reserve development in any segment or line of business in Second Quarter 2026 or Six Months 2026. The unfavorable prior year casualty reserve development in Second Quarter 2025 and Six Months 2025 was primarily driven by (i) our commercial automobile line of business that experienced increased severities in accident years 2022 through 2024 and (ii) our general liability line of business that experienced increased severities in accident years 2022 and 2023.

Current year casualty loss costs were higher in Second Quarter 2026 and Six Months 2026 compared to the same prior-year periods, driven by elevated commercial automobile claim frequencies in the first half of the year and the increased loss trend assumptions that we recognized over the course of 2025 that are included in our expectations for 2026.

Standard Commercial Lines Segment

Lower NPWin Second Quarter 2026 and Six Months 2026 compared Second Quarter 2025 and Six Months 2025 reflected reduced new business and targeted actions on our renewal portfolio. Stronger new business pricing, informed by our view of expected loss trends, combined with a competitive environment, drove lower acquisition rates on new business. We are leveraging our granular insights and differentiated operating model to drive higher renewal retention on our best-performing business and meaningfully lower retention on our poorer-performing business through appropriate rating actions. While overall rate increases have moderated and retention is lower than the prior-year period, we expect these mix improvement actions to contribute to improved profitability.

Growth in NPE of 3% in Second Quarter 2026 and 4% in Six Months 2026 compared to the same prior-year periods is decelerating as the impact of lower NPW is materializing through the earnings process.

The loss and loss expense ratio decreased 3.3 points in Second Quarter 2026 compared to Second Quarter 2025, primarily due to (i)nonet prior year casualty reserve development in the current year quarter compared to 4.8-points of unfavorable prior year casualty reserve development in the year-ago quarter and (ii) lower non-catastrophe property losses, reflecting less severe wind and convective storms impacting our footprint in Second Quarter 2026 compared to Second Quarter 2025. These items were partially offset by higher current year casualty loss costs.

In Six Months 2026, the loss and loss expense ratio increased 0.3 points compared to Six Months 2025, with higher current year loss costs and catastrophe losses, predominantly offset by improvements in prior year casualty reserve development and non-catastrophe losses. The increase in catastrophe losses wasdriven by higher frequency and severity of winter storms and thunderstorm events that impacted our footprint this year compared to last, mainly in the first quarter of 2026.

The details of the prior year casualty reserve development by line of business were as follows:

Prior year casualty reserve development in Second Quarter 2025 and Six Months 2025 reflected (i) increased severities in accident years 2022 through 2024 in our commercial automobile line of business, and (ii) increased severities in accident years 2022 and 2023 in our general liability line of business.

Higher current year casualty loss costs in Second Quarter 2026 and Six Months 2026 reflected the increased loss trend assumptions we recognized throughout 2025 and included in our expectations for 2026. Elevated severity trend assumptions attributable to social inflation on our general liability and commercial automobile liability lines of business, as well as elevated commercial automobile claim frequencies in the first half of 2026, drove the increase in current year casualty loss costs. Lower workers compensation loss trends provided a partial offset from decreasing claim frequencies in our 2026 expectations.

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

NPW was down in Second Quarter 2026 and Six Months 2026 compared to the same prior-year periods, reflecting deliberate actions to enhance underwriting profitability. In sectors and markets where 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.

Growth in NPE of 4% in Second Quarter 2026 and 6 % in Six Months 2026 is decelerating as the impact of lower NPW in 2026 is materializing through the earnings process.

The combined ratio decreased 4.0 points in Second Quarter 2026 and 1.0 in Six Months 2026 compared to the same prior-year periods, primarily driven by the following:

The general liability line of business has experienced a long-term historical trend of meaningful severity increases, partially offset by claim frequency decreases. 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.

These dynamics have impacted our view of current year loss costs. The increased loss trend assumptions that we recognized over the course of 2025 that are included in our expectations for 2026, drove a 2.6-point increase in current year casualty loss costs in Second Quarter 2026 and a 2.3-point increase in Six Months 2026 compared to the same prior-year periods.

We did not record any prior year casualty reserve development in Second Quarter 2026 and Six Months 2026. We recorded $20.0 million of unfavorable prior year casualty reserve development in Second Quarter 2025 and Six Months 2025, which was driven by increased severities in accident years 2022 and 2023.

NPW decreased 7% in Second Quarter 2026 and 5% in Six Months 2026 compared to the same prior-year periods, driven by underwriting actions to improve profitability, such as achieving renewal pure price increases and tightening underwriting guidelines for fleet exposures. Lower renewal pure price increases this year compared to last were driven by a reduction in rates for physical damage that were partially offset by higher commercial automobile liability rates.

Growth in NPE of 1% in Second Quarter 2026 and 3% in Six Months 2026 compared to the same prior-year periods is decelerating as the impact of lower NPW in 2026 is materializing through the earnings process.

The combined ratio decreased 1.1 points in Second Quarter 2026 and 0.1 points in Six Months 2026 compared to the same prior-year periods, and included the following:

We did not record any prior year casualty reserve development in Second Quarter 2026 and Six Months 2026, compared to $25.0 million recorded in Second Quarter 2025 and Six Months 2025. Current year casualty loss costs were higher in Second Quarter 2026 and Six Months 2026 compared to the same prior-year periods, driven by elevated claim frequencies in the first half of the year andthe increased loss trend assumptions we recognized throughout 2025 that are included in our expectations for 2026.

In the aggregate, net catastrophe and non-catastrophe property losses were 1.5-points lower in Second Quarter 2026 and 1.9- points lower in Six Months 2026 compared to the same prior-year periods, and provided a partial offset to the increase in current year loss costs. This reduction was driven by (i) the earned impact of renewal pure price increases and (ii) period-to-period variability of catastrophe and non-catastrophe property losses.

1 Includes Inland Marine.

2 n/a: not applicable.

NPW decreased 4% in Second Quarter 2026 and 2% Six Months 2026 compared to the same prior-year periods, reflecting lower new business and deliberate actions to strengthen underwriting profitability.

Growth in NPE of 4% in Second Quarter 2026 and 6% in Six Months 2026 continued to reflect the impact of NPW growth through the first quarter of 2026, but is pressured by the impact of lower NPW this quarter.

The combined ratio decreased 6.3 points in Second Quarter 2026 compared to Second Quarter 2025, and increased 3.1 points in Six Months 2026 compared to Six Months 2025, and included the following:

In the aggregate, net catastrophe and non-catastrophe property losses were lower in Second Quarter 2026 compared to Second Quarter 2025, but were higher in Six Months 2026 compared to Six Months 2025. The increase in net catastrophe losses was driven byhigher frequency and severity of winter storms and thunderstorm events that impacted our footprint this year compared to last, mainly in the first quarter of 2026.

NPW decreased 8% in Second Quarter 2026 and 6% in Six Months 2026 compared to the same prior-year periods, primarily due to negative rate changes. These rate level reductions were 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. Additionally, retention is down compared to the same prior-year periods, resulting from underwriting actions taken to improve profitability.

The combined ratio decreased 7.0 points in Second Quarter 2026 and 5.8 points in Six Months 2026 compared to the same prior-year periods and included the following:

Lower current year casualty loss costs in Second Quarter 2026 and Six Months 2026 compared to the same prior-year periods were primarily driven by decreased claim frequencies leading to improved loss trends. In addition, the combined ratio benefited from a 2.1-point reduction in underwriting expenses in Second Quarter 2026 and a 1.8-point reduction in Six Months 2026 compared to the same prior-year periods, which was primarily driven by lower commissions on this line of business.

Standard Personal Lines Segment

Lower NPW and NPE in Second Quarter 2026 and Six Months 2026 compared to the same prior-year periods was driven by reductions in direct new business and lower renewal pure price increases. New business decreased 36% in Second Quarter 2026 and 27% in Six Months 2026 compared to the same prior-year periods, driven by (i) market conditions, including an increasingly competitive market for auto insurance and (ii) restrictions we have in place to manage overall growth in the State of New Jersey. We have received regulatory approvals for increased rate levels in most of our footprint states and are focused on growth in our target market segment where we believe our rates are adequate. In Second Quarter 2026 and Six Months 2026 we achieved renewal pure price increases of 8.9% and 9.6%, respectively. Additionally, we continue to focus our efforts on our target mass affluent market, with 98% of new business through Six Months 2026 being in our target market.

The following table depicts direct new business, retention, and renewal pure price increases for the Second Quarter 2026 and Six Months 2026:

1 Excludes our Flood direct premiums written, which are 100% ceded to the NFIP and do not impact NPW.

The loss and loss expense ratio increased 2.4 points in Second Quarter 2026 compared to Second Quarter 2025, primarily driven by higher non-catastrophe losses due to normal period-to-period variability of such losses. Non-catastrophe losses were partially offset by net catastrophe losses that were lower in Second Quarter 2026 compared to Second Quarter 2025 due to lower frequency and severity of weather-related catastrophe events this year compared to last year.

The 1.3-point decrease in the loss and loss expense ratio in Six Months 2026 compared to Six Months 2025 wasdriven primarily by the absence of prior year casualty reserve development as illustrated in the table below:

The $5.0 million of unfavorable prior year casualty reserve development in Six Months 2025 was primarily driven by increased severities in accident year 2024 related to the New Jersey portfolio.

Underwriting Expenses

Our underwriting expense ratio increased 1.5 points and 0.5 points in Second Quarter 2026 and Six Months 2026, respectively, compared to the prior year periods, as lower NPE has put pressure on our underwriting expense ratio.

E&S Lines Segment

Increased competition in the marketplace and our continued underwriting discipline contributed to a decline in NPW of 2% in Second Quarter 2026 and 1% in Six Months 2026 compared to the same prior-year periods. This NPW decline was primarily due to more capacity entering the excess and surplus lines marketplace and the admitted markets' expansion in appetite for business previously written by excess and surplus lines companies. NPW includes the impact of the following:

Despite the decline in NPW during 2026, NPE grew 5% in Second Quarter 2026 and 6% in Six Months 2026 compared to the same prior-year periods, driven by growth in NPW in 2025 and the corresponding earnings of those premiums written.

The loss and loss expense ratio increased 2.1 points in Second Quarter 2026 and decreased 0.2 points in Six Months 2026 compared to the same prior-year periods. In both Second Quarter 2026 and Six Months 2026, the loss and loss expense ratio was increased by (i) higher current year casualty loss costs, primarily driven by higher embedded severity assumptions due to social inflation and (ii) higher non-catastrophe property loss and loss expenses, reflecting normal period-to-period variability associated with property losses. Net catastrophe losses provided an offset to these items in both periods, with Six Months 2026 having a larger offset as the California Palisades Fire impacted the first quarter of 2025.

Reinsurance

We successfully completed negotiations of our July 1, 2026 excess of loss treaties that cover Standard Commercial Lines, Standard Personal Lines, and E&S Lines.

We renewed the Casualty Excess of Loss Treaty ("Casualty Treaty") with coverage for $87 million in excess of a $3 million retention per loss occurrence, which is the same as the expiring treaty. We continue to retain a portion of the first layer through an 8% co-participation, compared to a 20% co-participation in the expiring treaty. The 2026 treaty year deposit premium increased primarily due to increased premium rates and lower co-participation in the first layer.

We also renewed the Property Excess of Loss Treaty ("Property Treaty") with the same retention as the expiring treaty, but with a $20 million increase in limit. The treaty now provides coverage for $115 million in excess of a $5 million retention for losses on a per-risk basis. The treaty year deposit premium decreased modestly, primarily driven by a reduction in rates.

The following table summarizes the Casualty Treaty and Property Treaty arrangements covering our Insurance Subsidiaries:

Investments

Our Investments segment's objectives are to maximize the economic value of our investment portfolio by achieving stable, risk-adjusted after-tax net investment income and generating long-term growth in book value per share. Our strategies consider prevailing market conditions, our enterprise risk tolerances, and other risk implications by:

•Maximizing the portfolio's overall total return by investing (i) the premiums from our insurance operations, (ii) amounts generated through our capital management strategies, including debt and equity security issuances, and (iii) profits of our business, and

•Maintaining (i) a well-diversified portfolio across issuers, sectors, and asset classes and (ii) a fixed income securities portfolio with high credit quality and acceptable duration and maturity profiles to provide ample liquidity.

The effective duration of our fixed income and short-term investments was 4.3 years as of June 30, 2026. 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.

Our fixed income and short-term investments represented 91% of invested assets at June 30, 2026, and 92% at December 31, 2025. Our fixed income and short-term investments portfolio had a weighted average credit rating of "A+" and investment grade holdings represented 97% of the total fixed income and short-term investment portfolio on both dates.

For further details on the composition, credit quality, and various risks to which our portfolio is subject, see Item 7A. "Quantitative and Qualitative Disclosures About Market Risk." of our 2025 Annual Report.

Invested assets increased $274.4 million at June 30, 2026, compared to December 31, 2025, primarily reflecting our active investment of operating cash flows, which were 18% of NPW in Six Months 2026, partially offset bya $94.5 million increase inpre-tax net unrealized losses in our fixed income portfolio primarily due to higher interest rates at June 30, 2026 compared to December 31, 2025.

Net Investment Income

Net investment income earned components were as follows:

After-tax net investment income earned increased 18% in both Second Quarter 2026 and Six Months 2026 compared to the same prior-year periods, primarily driven by (i) active portfolio management resulting in higher after-tax portfolio yield and (ii) operating cash flow deployment.

Realized and Unrealized Gains and Losses

When evaluating securities for sale, our general philosophy is to reduce our exposure to securities and sectors based on economic evaluations of whether (i) the fundamentals for that security or sector have deteriorated or (ii) the timing is appropriate to trade opportunistically for other securities with better economic-return characteristics. Net realized and unrealized gains and losses for the indicated periods were as follows:

The change in net realized and unrealized investment gains in Second Quarter 2026 and Six Months 2026, compared to the same prior-year periods, was primarily due to an increase in valuations reflecting the current public equities market. The increase in unrealized gains on equity securities in Six Months 2026, compared to Six Months 2025, was partially offset by an increase in net credit loss expense on fixed income investments, primarily driven by higher interest rates in Six Months 2026 compared to Six Months 2025. The higher interest rates increased unrealized losses on our fixed income investments, thereby increasing the amount of recognized credit losses.