> ## Content Index > Fetch the complete content index at: https://www.bullished.co/llms.txt > Use this file to discover other available public pages before exploring further. # Selective Is Letting Its Weakest Commercial Accounts Walk — Retention In That 10% Slice Fell To 52% - URL: https://www.bullished.co/selective-is-letting-its-weakest-commercial-accounts-walk-retention-in-that-10-slice-fell-e4ec1c12/ - Published: 2026-10-23T13:22:03.000Z - Updated: 2026-10-23T13:22:03.000Z - Description: The CEO says the insurer is putting underwriting returns ahead of volume, and that the premium squeeze should be short-lived. - Author: Matteo Parrino - Tags: Earnings, SIGI, Industry: Financials [Selective Insurance Group](https://www.bullished.co/tag/sigi/), an insurer that sells commercial and personal coverage through independent agents, is shedding its worst-performing commercial accounts on purpose, CEO John Marchioni said on the [company's third-quarter earnings call](https://www.benzinga.com/news/26/10/62556914/selective-insurance-gr-q3-2026-earnings-call-transcript?ref=bullished.co) on Friday. Retention in the lowest-performing cohorts, about 10% of premium, fell to 52% from 79% a year earlier. ## Cutting the bottom 10% Marchioni, who is chairman, president and chief executive, said retention in the best-performing cohorts held at 90%. Renewal pure price increases in the weakest group [rose 17.2%](https://www.benzinga.com/news/26/10/62556914/selective-insurance-gr-q3-2026-earnings-call-transcript?ref=bullished.co), up from 12.8% a year earlier. Those targeted retention actions accounted for five points of the [8% decline](https://markets.ft.com/data/announce/detail?dockey=600-202610221615BIZWIRE%5FUSPRX%5F%5F%5F%5F20261022%5FBW777246-1&ref=bullished.co) in standard commercial net premiums written, he said; lower new business drove the rest. He stressed the five points span all commercial lines, not just auto. "They have reduced near-term premium growth, but we are prioritizing improved underwriting returns over volume," Marchioni said. He described the company as effectively three quarters through a full renewal cycle of the remediation, and said there was "a small acceleration" in the headwind from lower retention in the low and very low buckets. An RBC Capital Markets analyst asked for the profitability gap between best and worst cohorts. Marchioni said the company would not go to that level of specificity, but called the combined ratio differences "meaningful." ## Casualty pricing and the bet on discipline Marchioni argued that industry casualty margins are under pressure and market pricing generally sits below elevated severity trends. He said casualty loss ratios are being subsidized by property and other specialty lines whose margins are deteriorating, so the market will "have to come to grips" with them. Weak new business conversion, he said, will keep pressuring growth for now, but the drag "will be short-lived." CFO Patrick Brennan said general liability reserves have been stable for seven consecutive quarters, following actions in 2024 to raise loss-cost assumptions. He said commercial auto and general liability are not yet at target profitability. Marchioni put the company's share of the fragmented commercial lines market at roughly 1.5%. The company reported third-quarter operating return on equity of 16.9% and a [combined ratio of 96.8](https://markets.ft.com/data/announce/detail?dockey=600-202610221615BIZWIRE%5FUSPRX%5F%5F%5F%5F20261022%5FBW777246-1&ref=bullished.co), 1.8 points better than a year ago. Net investment income rose 16%. The expense ratio was 32.1%, which Brennan tied partly to lower premium volume. ## Dividend up 12%, new buyback Brennan announced a 12% increase in the quarterly dividend and a new $200 million repurchase program, lifting total capacity to about $253 million. The company returned about 63% of after-tax net income to shareholders in the quarter, including $55 million of opportunistic buybacks. For the full year, it kept its combined ratio guidance at 96.5% to 97.5% and raised expected after-tax net investment income to $490 million from $480 million. Brennan said the pieces point to a result closer to the middle of the range. Marchioni said the company is positioned to restore the growth profile investors are used to, with new agency appointments and a retail push in excess and surplus lines meant to add submissions. ### Sources - [Selective Insurance Gr Q3 2026 Earnings Call Transcript](https://www.benzinga.com/news/26/10/62556914/selective-insurance-gr-q3-2026-earnings-call-transcript?ref=bullished.co) — benzinga.com - [Here's What Key Metrics Tell Us About Selective Insurance (SIGI) Q3 Earnings](https://finance.yahoo.com/markets/stocks/articles/heres-key-metrics-tell-us-220002471.html?ref=bullished.co) — Yahoo Finance - [Selective Insurance (SIGI) Q3 Earnings Top Estimates](https://finance.yahoo.com/markets/stocks/articles/selective-insurance-sigi-q3-earnings-210007524.html?.tsrc=rss&ref=bullished.co) — Yahoo Finance - [Selective Reports Third Quarter 2026 Results – Company Announcement - FT.com](https://markets.ft.com/data/announce/detail?dockey=600-202610221615BIZWIRE%5FUSPRX%5F%5F%5F%5F20261022%5FBW777246-1&ref=bullished.co) — Financial Times - [Selective Insurance Non-GAAP EPS of $2.37 beats by $0.44, revenue of $1.33B misses by $20M (NASDAQ:SIGI)](https://seekingalpha.com/news/4656264-selective-insurance-non-gaap-eps-of-2%5F37-beats-by-0%5F44-revenue-of-1%5F33b-misses-by-20m?ref=bullished.co) — seekingalpha.com ### More on Selective Insurance Group - [Selective Insurance Raises Dividend 12% To $0.48 And Authorizes A $200 Million Buyback](https://www.bullished.co/selective-insurance-raises-dividend-12-to-0-48-and-authorizes-a-200-million-buyback-ded4705c/) [All Selective Insurance Group (SIGI) coverage →](https://www.bullished.co/tag/sigi/)