SELECTIVE INSURANCE GROUP INCSIGI
SELECTIVE INSURANCE GROUP INC Fair Value Disclosure
Fair Value Measurements
The financial assets in our investment portfolio are primarily measured at fair value as disclosed on the Consolidated Balance Sheets. The following table presents the carrying amounts and estimated fair values of our financial liabilities as of December 31, 2025 and 2024:
| December 31, 2025 | December 31, 2024 | |||||||||||||||||||||||||
| ($ in thousands) | Carrying Amount | Fair Value | Carrying Amount | Fair Value | ||||||||||||||||||||||
| Financial Liabilities | ||||||||||||||||||||||||||
| Long-term debt: | ||||||||||||||||||||||||||
7.25% Senior Notes | $ | 49,936 | 56,973 | 49,931 | 54,657 | |||||||||||||||||||||
6.70% Senior Notes | 99,617 | 110,244 | 99,590 | 103,057 | ||||||||||||||||||||||
5.90% Senior Notes | 399,917 | 419,869 | — | — | ||||||||||||||||||||||
5.375% Senior Notes | 294,737 | 277,541 | 294,627 | 273,464 | ||||||||||||||||||||||
3.03% Borrowings from FHLBI | 60,000 | 59,625 | 60,000 | 58,516 | ||||||||||||||||||||||
| Subtotal long-term debt | 904,207 | 924,252 | 504,148 | 489,694 | ||||||||||||||||||||||
| Unamortized debt issuance costs | (5,904) | (2,492) | ||||||||||||||||||||||||
| Finance lease obligations | 3,570 | 6,282 | ||||||||||||||||||||||||
| Total long-term debt | $ | 901,873 | $ | 507,938 | ||||||||||||||||||||||
For discussion regarding the fair value techniques of our financial instruments, refer to Note 2. "Summary of Significant Accounting Policies" of this Form 10-K.
The following tables provide quantitative disclosures of our financial assets that were measured and recorded at fair value at December 31, 2025 and 2024:
| December 31, 2025 | Fair Value Measurements Using | |||||||||||||||||||||||||
| ($ in thousands) | Assets Measured at Fair Value | Quoted Prices in Active Markets for Identical Assets/ Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | ||||||||||||||||||||||
| Description | ||||||||||||||||||||||||||
| Measured on a recurring basis: | ||||||||||||||||||||||||||
| AFS fixed income securities: | ||||||||||||||||||||||||||
| U.S. government and government agencies | $ | 163,207 | 39,472 | 123,735 | — | |||||||||||||||||||||
| Foreign government | 10,002 | — | 10,002 | — | ||||||||||||||||||||||
| Obligations of states and political subdivisions | 549,957 | — | 542,548 | 7,409 | ||||||||||||||||||||||
| Corporate securities | 3,404,164 | — | 3,035,053 | 369,111 | ||||||||||||||||||||||
| CLO and other ABS | 2,550,286 | — | 1,985,197 | 565,089 | ||||||||||||||||||||||
| RMBS | 2,075,933 | — | 2,075,933 | — | ||||||||||||||||||||||
| CMBS | 703,627 | — | 703,292 | 335 | ||||||||||||||||||||||
| Total AFS fixed income securities | 9,457,176 | 39,472 | 8,475,760 | 941,944 | ||||||||||||||||||||||
| Equity securities: | ||||||||||||||||||||||||||
Common stock1 | 382,577 | 107,125 | 653 | — | ||||||||||||||||||||||
| Preferred stock | 1,839 | 1,839 | — | — | ||||||||||||||||||||||
| Total equity securities | 384,416 | 108,964 | 653 | — | ||||||||||||||||||||||
| Short-term investments | 648,542 | 637,751 | 10,791 | — | ||||||||||||||||||||||
| Total assets measured at fair value | $ | 10,490,134 | 786,187 | 8,487,204 | 941,944 | |||||||||||||||||||||
| December 31, 2024 | Fair Value Measurements Using | |||||||||||||||||||||||||
| ($ in thousands) | Assets Measured at Fair Value | Quoted Prices in Active Markets for Identical Assets/ Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | ||||||||||||||||||||||
| Description | ||||||||||||||||||||||||||
| Measured on a recurring basis: | ||||||||||||||||||||||||||
| AFS fixed income securities: | ||||||||||||||||||||||||||
| U.S. government and government agencies | $ | 120,155 | 35,518 | 84,637 | — | |||||||||||||||||||||
| Foreign government | 9,302 | — | 9,302 | — | ||||||||||||||||||||||
| Obligations of states and political subdivisions | 451,230 | — | 443,804 | 7,426 | ||||||||||||||||||||||
| Corporate securities | 3,068,180 | — | 2,825,501 | 242,679 | ||||||||||||||||||||||
| CLO and other ABS | 2,033,149 | — | 1,665,155 | 367,994 | ||||||||||||||||||||||
| RMBS | 1,692,358 | — | 1,692,358 | — | ||||||||||||||||||||||
| CMBS | 752,960 | — | 752,620 | 340 | ||||||||||||||||||||||
| Total AFS fixed income securities | 8,127,334 | 35,518 | 7,473,377 | 618,439 | ||||||||||||||||||||||
| Equity securities: | ||||||||||||||||||||||||||
Common stock1 | 211,767 | 41,445 | — | 808 | ||||||||||||||||||||||
| Preferred stock | 1,834 | 1,834 | — | — | ||||||||||||||||||||||
| Total equity securities | 213,601 | 43,279 | — | 808 | ||||||||||||||||||||||
| Short-term investments | 509,318 | 474,225 | 35,093 | — | ||||||||||||||||||||||
| Total assets measured at fair value | $ | 8,850,253 | 553,022 | 7,508,470 | 619,247 | |||||||||||||||||||||
1Investments amounting to $274.8 million at December 31, 2025 and $169.5 million at December 31, 2024, were measured at fair value using the net asset value per share (or its practical expedient) and have not been classified in the fair value hierarchy. These investments are subject to restrictions on redemption, and the timing of liquidations of the underlying assets is unknown at each reporting period. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to total assets measured at fair value.
The following tables provide a summary of Level 3 changes for the years indicated:
| 2025 | ||||||||||||||||||||||||||||||||||||||||||||
| ($ in thousands) | Obligations of states and political subdivisions | Corporate Securities | CLO and Other ABS | RMBS | CMBS | Common Stock | Total | |||||||||||||||||||||||||||||||||||||
| Fair value, December 31, 2024 | $ | 7,426 | 242,679 | 367,994 | — | 340 | 808 | 619,247 | ||||||||||||||||||||||||||||||||||||
Total net gains (losses) for the period included in: | ||||||||||||||||||||||||||||||||||||||||||||
| OCI | 8 | 6,567 | 3 | 27 | — | — | 6,605 | |||||||||||||||||||||||||||||||||||||
Net realized and unrealized investment gains (losses) | 121 | 220 | (573) | — | — | 655 | 423 | |||||||||||||||||||||||||||||||||||||
| Net investment income earned | — | 52 | 44 | (6) | 3 | — | 93 | |||||||||||||||||||||||||||||||||||||
| Purchases | — | 65,458 | 200,267 | 5,555 | — | — | 271,280 | |||||||||||||||||||||||||||||||||||||
| Sales | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Issuances | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Settlements | (146) | (21,699) | (82,941) | (330) | (8) | (1,463) | (106,587) | |||||||||||||||||||||||||||||||||||||
| Transfers into Level 3 | — | 76,129 | 123,598 | — | — | — | 199,727 | |||||||||||||||||||||||||||||||||||||
| Transfers out of Level 3 | — | (295) | (43,303) | (5,246) | — | — | (48,844) | |||||||||||||||||||||||||||||||||||||
| Fair value, December 31, 2025 | $ | 7,409 | 369,111 | 565,089 | — | 335 | — | 941,944 | ||||||||||||||||||||||||||||||||||||
Change in unrealized gains (losses) for the period included in earnings for assets held at period end | 121 | 219 | (573) | — | — | — | (233) | |||||||||||||||||||||||||||||||||||||
Change in unrealized gains (losses) for the period included in OCI for assets held at period end | 8 | 6,559 | 718 | 27 | — | — | 7,312 | |||||||||||||||||||||||||||||||||||||
| 2024 | ||||||||||||||||||||||||||||||||||||||||||||
| ($ in thousands) | Obligations of states and political subdivisions | Corporate Securities | CLO and Other ABS | RMBS | CMBS | Common Stock | Total | |||||||||||||||||||||||||||||||||||||
| Fair value, December 31, 2023 | $ | 7,834 | 297,332 | 245,313 | — | 356 | 854 | 551,689 | ||||||||||||||||||||||||||||||||||||
Total net gains (losses) for the period included in: | ||||||||||||||||||||||||||||||||||||||||||||
| OCI | (143) | 10,790 | 3,920 | 77 | (6) | — | 14,638 | |||||||||||||||||||||||||||||||||||||
Net realized and unrealized investment gains (losses) | (127) | 881 | (223) | — | — | (46) | 485 | |||||||||||||||||||||||||||||||||||||
| Net investment income earned | — | (429) | 653 | 1 | (3) | — | 222 | |||||||||||||||||||||||||||||||||||||
| Purchases | — | 28,226 | 181,920 | 4,888 | — | — | 215,034 | |||||||||||||||||||||||||||||||||||||
| Sales | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Issuances | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Settlements | (138) | (29,624) | (51,188) | (255) | (7) | — | (81,212) | |||||||||||||||||||||||||||||||||||||
| Transfers into Level 3 | — | 30,380 | 20,088 | — | — | — | 50,468 | |||||||||||||||||||||||||||||||||||||
| Transfers out of Level 3 | — | (94,877) | (32,489) | (4,711) | — | — | (132,077) | |||||||||||||||||||||||||||||||||||||
| Fair value, December 31, 2024 | $ | 7,426 | 242,679 | 367,994 | — | 340 | 808 | 619,247 | ||||||||||||||||||||||||||||||||||||
Change in unrealized gains (losses) for the period included in earnings for assets held at period end | (127) | 891 | (223) | — | — | 146 | 687 | |||||||||||||||||||||||||||||||||||||
Change in unrealized gains (losses) for the period included in OCI for assets held at period end | (143) | 10,193 | 4,525 | 77 | (6) | — | 14,646 | |||||||||||||||||||||||||||||||||||||
The following tables present quantitative information about the significant unobservable inputs used in the fair value measurements of Level 3 assets at December 31, 2025, and 2024:
| December 31, 2025 | ||||||||||||||||||||||||||||||||
| ($ in thousands) | Assets Measured at Fair Value | Valuation Techniques | Unobservable Inputs | Range | Weighted Average | |||||||||||||||||||||||||||
| Internal valuations: | ||||||||||||||||||||||||||||||||
| Corporate securities | $ | 175,433 | DCF | Illiquidity Spread | (4.4)% - 5.3% | 1.9% | ||||||||||||||||||||||||||
| CLO and other ABS | 295,307 | DCF | Illiquidity Spread | (1.8)% - 19.6% | 2.3% | |||||||||||||||||||||||||||
| Total internal valuations | 470,740 | |||||||||||||||||||||||||||||||
Other1 | 471,204 | |||||||||||||||||||||||||||||||
| Total Level 3 securities | $ | 941,944 | ||||||||||||||||||||||||||||||
| December 31, 2024 | ||||||||||||||||||||||||||||||||
| ($ in thousands) | Assets Measured at Fair Value | Valuation Techniques | Unobservable Inputs | Range | Weighted Average | |||||||||||||||||||||||||||
Internal valuations: | ||||||||||||||||||||||||||||||||
| Corporate securities | $ | 147,294 | DCF | Illiquidity Spread | (4.4)% - 5.3% | 1.7% | ||||||||||||||||||||||||||
| CLO and other ABS | 249,506 | DCF | Illiquidity Spread | (0.97)% - 19.6% | 1.9% | |||||||||||||||||||||||||||
| Total internal valuations | 396,800 | |||||||||||||||||||||||||||||||
Other1 | 222,447 | |||||||||||||||||||||||||||||||
| Total Level 3 securities | $ | 619,247 | ||||||||||||||||||||||||||||||
1Other is comprised of broker quotes or other third-party pricing for which there is a lack of transparency into the inputs used to develop the valuations. The quantitative details of these unobservable inputs is neither provided to us, nor reasonably available to us, and therefore are not included in the tables above.
For the securities in the tables above valued using a DCF analysis, we apply an illiquidity spread in our determination of fair value. An increase in this assumption would result in a lower fair value measurement.
The following tables provide quantitative information regarding our financial assets and liabilities that were not measured at fair value, but were disclosed as such at December 31, 2025, and 2024:
| December 31, 2025 | Fair Value Measurements Using | |||||||||||||||||||||||||
| ($ in thousands) | Assets/Liabilities Disclosed at Fair Value | Quoted Prices in Active Markets for Identical Assets/Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | ||||||||||||||||||||||
| Financial Assets | ||||||||||||||||||||||||||
| HTM: | ||||||||||||||||||||||||||
| Corporate securities | $ | 23,939 | — | 23,939 | — | |||||||||||||||||||||
| Total HTM fixed income securities | 23,939 | — | 23,939 | — | ||||||||||||||||||||||
| CMLs | $ | 274,895 | — | — | 274,895 | |||||||||||||||||||||
| Financial Liabilities | ||||||||||||||||||||||||||
| Long-term debt: | ||||||||||||||||||||||||||
7.25% Senior Notes | $ | 56,973 | — | 56,973 | — | |||||||||||||||||||||
6.70% Senior Notes | 110,244 | — | 110,244 | — | ||||||||||||||||||||||
5.90% Senior Notes | 419,869 | — | 419,869 | — | ||||||||||||||||||||||
5.375% Senior Notes | 277,541 | — | 277,541 | — | ||||||||||||||||||||||
3.03% Borrowings from FHLBI | 59,625 | — | 59,625 | — | ||||||||||||||||||||||
| Total long-term debt | $ | 924,252 | — | 924,252 | — | |||||||||||||||||||||
| December 31, 2024 | Fair Value Measurements Using | |||||||||||||||||||||||||
| ($ in thousands) | Assets/Liabilities Disclosed at Fair Value | Quoted Prices in Active Markets for Identical Assets/Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | ||||||||||||||||||||||
| Financial Assets | ||||||||||||||||||||||||||
| HTM: | ||||||||||||||||||||||||||
| Corporate securities | $ | 24,735 | — | 24,735 | — | |||||||||||||||||||||
| Total HTM fixed income securities | 24,735 | — | 24,735 | — | ||||||||||||||||||||||
| CMLs | $ | 224,842 | — | — | 224,842 | |||||||||||||||||||||
| Financial Liabilities | ||||||||||||||||||||||||||
| Long-term debt: | ||||||||||||||||||||||||||
7.25% Senior Notes | $ | 54,657 | — | 54,657 | — | |||||||||||||||||||||
6.70% Senior Notes | 103,057 | — | 103,057 | — | ||||||||||||||||||||||
5.375% Senior Notes | 273,464 | — | 273,464 | — | ||||||||||||||||||||||
3.03% Borrowings from FHLBI | 58,516 | — | 58,516 | — | ||||||||||||||||||||||
| Total long-term debt | $ | 489,694 | — | 489,694 | — | |||||||||||||||||||||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 9, 2026 | Showing above |
| 2024 | Feb 10, 2025 | |
| 2023 | Feb 9, 2024 | |
| 2022 | Feb 10, 2023 | |
| 2021 | Feb 11, 2022 | |
| 2020 | Feb 12, 2021 | |
| 2019 | Feb 12, 2020 | |
| 2018 | Feb 15, 2019 | |
| 2017 | Feb 20, 2018 | |
| 2016 | Feb 22, 2017 | |
| 2015 | Feb 24, 2016 | |
About Fair Value Disclosures
Fair value disclosures classify all assets and liabilities measured at fair value into a three-level hierarchy: Level 1 (quoted market prices), Level 2 (observable inputs like yield curves), and Level 3 (unobservable inputs requiring management estimates). The proportion of Level 3 assets directly reflects how much of the balance sheet depends on internal models rather than market evidence.
Key signals: a growing Level 3 balance relative to total fair-value assets increases valuation uncertainty and earnings volatility risk. Watch for transfers between levels — assets moving from Level 2 to Level 3 often signal deteriorating market liquidity. Unrealized gains and losses on Level 3 positions flow through earnings or other comprehensive income, so large swings deserve scrutiny. For financial institutions, examine the sensitivity disclosures that show how Level 3 valuations change under alternative assumptions. Compare the fair value of debt against its carrying amount to gauge hidden leverage.