SELECTIVE INSURANCE GROUP INC (SIGI) Business

Item 1. Business.

Overview

Selective Insurance Group, Inc. ("Parent") is a New Jersey insurance holding company incorporated in 1977. It owns ten property and casualty insurance subsidiaries ("Insurance Subsidiaries") that sell products and services only in the United States ("U.S.") and exclusively through independent insurance agents and wholesale brokers. Nine of our Insurance Subsidiaries are licensed by various state insurance departments as admitted carriers, allowing them to write specific property and casualty lines in the standard market. The tenth subsidiary is authorized as a non-admitted carrier to write property and casualty insurance in the excess and surplus ("E&S") lines market. Throughout this document, we refer to the Parent and the Insurance Subsidiaries collectively as "we," "us," or "our." We use "Parent" when appropriate to distinguish it from the Insurance Subsidiaries. Specific terms related to the property and casualty industry are defined in a glossary attached as Exhibit 99.1 to this Form 10-K.

We have a long and successful history in the property and casualty insurance industry dating back to our 1926 founding. We list our common (stock symbol "SIGI") and preferred (stock symbol "SIGIP") stocks on the Nasdaq Global Select Market. In 2025, AM Best Company ("AM Best") ranked us as the 34th largest property and casualty group in its annual "Top 200 U.S. Property/Casualty Writers" list based on 2024 net premiums written ("NPW"). Our current AM Best financial strength rating is "A+" (Superior).

Strategic Advantages

Our competitive and crowded market requires us to clearly articulate and demonstrate our value proposition to customers, distribution partners, employees, and investors. We believe our five key sustainable competitive advantages are:

•A unique operating model that places empowered decision-makers alongside our customers and distribution partners.

•A franchise-value distribution model, characterized by close and meaningful business relationships with a select group of high-quality distribution partners.

•An ability to develop and integrate sophisticated technology tools that support our front-line employees in making informed risk selection, pricing, and claims decisions.

•A commitment to delivering a superior omnichannel customer experience, enhanced by people and technology.

•A highly engaged and aligned team of extremely talented employees.

Several nationally recognized statistical rating organizations ("NRSROs") evaluate and rate our financial strength, operating performance, strategic position, and ability to meet policyholder obligations.

We believe our AM Best rating most significantly influences our ability to write insurance business. Our independent distribution partners recommend insurance carriers based partly on financial strength ratings to (i) ensure an insurance carrier's ability to pay claims and provide benefits to customers when needed, directly impacting the level of trust a customer has in an insurance carrier and (ii) limit their potential liability for customer error and omission claims. Similarly, many customers consider ratings when purchasing insurance because their loan, mortgage, and other real and personal property security agreements typically require minimum carrier financial strength rating requirements.

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These NRSROs also evaluate and rate our long-term debt creditworthiness and capacity to meet obligations when they come due. Credit ratings significantly influence our overall funding profile and ability to access certain types of liquidity. Our current senior debt credit ratings are as follows:

Our S&P, Moody's, and Fitch financial strength and credit ratings influence our ability to advantageously access capital markets more than our AM Best rating.

Segments

We have four reportable segments:

•Standard Commercial Lines, which represented 71% of our 2025 "Total revenues" on our Consolidated Statements of Income and 79% of our 2025 total NPW. We sell our Standard Commercial Lines property and casualty insurance products and services to commercial enterprises, typically businesses, non-profit organizations, and local government agencies, primarily in 36 states and the District of Columbia. Our average 2025 Standard Commercial Lines premium per policyholder was approximately $20,600.

•Standard Personal Lines, which represented 8% of our 2025 "Total revenues" on our Consolidated Statements of Income and 8% of our 2025 total NPW. We sell our Standard Personal Lines property and casualty insurance products and services primarily to individuals in 15 states. Our average 2025 Standard Personal Lines premium per policyholder, excluding flood premium, was approximately $4,100. Standard Personal Lines includes flood insurance coverage sold in all 50 states and the District of Columbia through the Write Your Own ("WYO") program of the National Flood Insurance Program ("NFIP"). We are the fourth-largest WYO carrier based on 2024 direct premiums written ("DPW") reported in the S&P Market Intelligence platform.

•E&S Lines, which represented 11% of our 2025 "Total revenues" on our Consolidated Statements of Income and 13% of our 2025 total NPW. We sell our E&S Lines property and casualty insurance products and services in all 50 states and the District of Columbia. Our average 2025 E&S Lines premium per policyholder was approximately $6,000. The market for our E&S Lines property and casualty insurance products and services is commercial customers unable to obtain coverage in the standard marketplace, generally because of unusual or high-risk exposures. E&S insurers are exempt from many standard market requirements, including form and rate regulation.

•Investments, which represented 10% (including net realized and unrealized gains and losses) of "Total revenues," invests the (i) premiums our Insurance Subsidiaries collect and (ii) amounts generated through our capital management strategies, including debt and equity securities issuance.

We derive nearly all our income/loss in three ways:

•Underwriting income/loss from our insurance operations. We use DPW, gross premiums, NPW, and net premiums earned ("NPE") to evaluate underwriting income/loss. DPW are the amounts billed to policyholders for insurance coverage and services. Gross premiums are DPW plus premiums assumed from other insurers and mandatory pools and associations. NPW are calculated by subtracting premiums ceded to reinsurers from gross premiums. NPE is NPW recognized as revenue ratably over a policy’s term. Underwriting income/loss is NPE minus insurance operations-related expenses incurred.

Insurance operations-related expenses fall into three categories on our Consolidated Statements of Income: (i) "Loss and loss expense incurred," which includes losses associated with claims and loss expenses for adjusting claims incurred during a policy's term, net of losses and loss expenses ceded to reinsurers; (ii) "Amortization of deferred policy acquisition costs," which includes expenses related to the successful acquisition of insurance policies, such as commissions to our distribution partners and premium taxes, recognized ratably over a policy's term; and (iii) "Other insurance expenses," which includes acquisition and other insurance-related expenses not otherwise classified as "Loss and loss expense incurred" or "Amortization of deferred policy acquisition costs" incurred in maintaining policies. These expenses include, but are not limited to, certain labor expenses, depreciation expense, and

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policyholder dividends.

Total underwriting expenses are the sum of "Amortization of deferred policy acquisition costs" and "Other insurance expenses", offset by "Other income" on our Consolidated Statements of Income. Other income primarily consists of installment fees charged to customers who pay their premiums in installments.

•Net investment income earned from our investment segment. We generate income from investing insurance premiums and amounts generated through our capital management strategies. Net investment income consists primarily of (i) interest earned on fixed income investments and commercial mortgage loans, (ii) dividends earned on equity securities, and (iii) income generated from our alternative investments portfolio, partially offset by (iv) investment expenses.

•Net realized and unrealized gains and losses on investment securities from our investments segment. Net realized and unrealized gains and losses from our investment portfolio result from (i) security disposals through sales, calls, and redemptions, (ii) losses on securities that we intend to sell, (iii) credit loss expense or benefit, and (iv) net unrealized gains and losses on equity securities.

"Net income (or loss) available to common stockholders" on our Consolidated Statements of Income also includes (i) corporate expenses, including long-term employee incentive compensation and other general corporate expenses, (ii) interest on our debt obligations, (iii) federal income taxes, and (iv) dividends to preferred stockholders.

To measure financial performance, we use (i) net income (or loss) available to common stockholders and (ii) an operating income calculation that does not conform to U.S. generally accepted accounting principles ("non-GAAP"). Non-GAAP operating income differs from net income available to common stockholders by excluding after-tax net realized and unrealized gains and losses on investments. This non-GAAP measure is used as an important financial measure by us, analysts, and investors because the timing of realized investment gains and losses on securities in any given period is largely discretionary. In addition, net realized and unrealized investment gains and losses could distort the analysis of trends.

We use combined ratio as the key performance measure to assess the underwriting profitability of our insurance operations. The combined ratio is the sum of (i) the loss and loss expense ratio, which is the ratio of net loss and loss expense incurred to NPE, (ii) the expense ratio, which is the ratio of underwriting expenses to NPE, and (iii) the dividend ratio, which is the ratio of policyholder dividends to NPE. A combined ratio under 100% indicates an underwriting profit, and one over 100% indicates an underwriting loss. The combined ratio does not reflect net investment income earned, net realized and unrealized investment gains or losses, federal income taxes, interest expense, or corporate expenses. The loss and loss expense ratio typically has the most significant impact on our combined ratio. Key inputs in our loss and loss expense ratio include catastrophe and non-catastrophe property loss and loss expenses incurred, current year casualty loss and loss expenses, and prior year casualty reserve development.

We evaluate our investments segment's financial performance using after-tax net investment income earned. We also assess total return, which we calculate as the ratio of the sum of the following pre-tax components, to average invested assets: (i) net investment income, (ii) net realized and unrealized investment gains or losses (including losses on securities we intend to sell and credit loss expense or benefit) in income, and (iii) unrealized investment gains or losses included in accumulated other comprehensive income or loss. Our investment philosophy is predicated on setting specific risk and return objectives for the fixed income, equity, and alternative investment portfolios and comparing each to a weighted-average benchmark of comparable indices.

Other important measures of our overall financial performance that we consider include return on common equity ("ROE") and non-GAAP operating return on common equity ("non-GAAP operating ROE"). We use non-GAAP operating ROE for the same reason we use non-GAAP operating income: to avoid trend analysis distortion from the largely discretionary timing of investment gains and losses. ROE is calculated by dividing net income available to common stockholders by average common stockholders' equity. Non-GAAP operating ROE is calculated by dividing non-GAAP operating income available to common stockholders by average common stockholders' equity. We evaluate our segments, in part, based on their contribution to non-GAAP operating ROE. We strive to achieve an average non-GAAP operating ROE of 12% over time.

For further details about our 2025 results compared to these performance measures, refer to "Financial Highlights of Results for Years Ended December 31, 2025, 2024, and 2023" in Item 7. "Management's Discussion and Analysis of Financial Condition and Results of Operations." of this Form 10-K.

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Insurance Operations

Overview

Our insurance operations generate revenue by selling insurance policies and services in exchange for insurance premiums. Nearly all our sales come from one-year term policies, and the most significant cost associated with these policies is loss and loss expense for covered events.

Loss and loss expense reserves are one of our critical accounting estimates and represent the ultimate amounts we will need to pay in the future for incurred covered claims and related expenses for policies we have sold. Estimating reserves as of any given date is inherently uncertain, and requires estimation techniques and considerable judgment. We regularly assess our overall reserve position through internal and external actuarial reserve reviews. For a discussion of our loss reserving process, see "Critical Accounting Policies and Estimates" in Item 7. "Management's Discussion and Analysis of Financial Condition and Results of Operations." and Note 2. "Summary of Significant Accounting Policies" in Item 8. "Financial Statements and Supplementary Data." of this Form 10-K.

To protect our capital resources and manage the risks associated with our coverage obligations to our insureds, we purchase reinsurance from third parties and enter into other risk transfer agreements with them. Our Insurance Subsidiaries also transfer risks and share premiums and losses based on percentages specified in an insurance holding system intercompany reinsurance pooling agreement. For information on our reinsurance treaties and agreements, see "Reinsurance" in Item 7. "Management's Discussion and Analysis of Financial Condition and Results of Operations." of this Form 10-K.

Products and Services

Our Insurance Subsidiaries sell two broad categories of insurance policies:

•Casualty insurance, which generally covers the financial consequences of (i) third-party bodily injury and/or property damage from an insured's negligent acts, omissions, or legal liabilities, (ii) our obligation to defend our insured(s) for covered claims, and (iii) injuries employees suffer in the course of employment. Casualty claims are long-tailed, and while most claims are reported within the first few years, they may take many years to fully resolve.

•Property insurance, which generally covers accidental loss to an insured's real property, personal property, and/or property loss-related earnings. Property claims are usually reported and settled in a relatively short period after the date of loss.

The following table shows the principal types of property and casualty insurance policies we underwrite and issue:

1Most of our flood loss exposure relates to our participation in the NFIP's WYO program, to which we cede 100% of our WYO flood insurance premiums and losses. Our Standard Personal Lines segment results include our WYO policies issued to Standard Personal Lines and Standard Commercial Lines customers.

Product Development and Pricing

Our insurance policies are contracts with our policyholders that specify the losses we cover and the amounts we will pay for covered claims. We develop our coverages by (i) adopting policy forms created or filed by statistical rating agencies or other third parties, including Verisk Analytics' Insurance Services Office, Inc. ("ISO"), American Association of Insurance Services, Inc. ("AAIS"), and the National Council on Compensation Insurance, Inc. ("NCCI"), (ii) independently creating our policy forms, or (iii) modifying third-party policy forms. When developing products and services, we consider market demands, profitability, competitive research, feedback from our independent distribution partners, and the potential for the product or service to enhance the safety of our customers' commercial or personal endeavors.

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Our policies insure future covered events, so we cannot determine an individual policy's actual loss costs when sold and issued. Consequently, we consider many risk characteristics when pricing policies. Like most property and casualty insurers, our loss data is not sufficiently credible to independently establish the complex loss costs and rating variable structures our products require. We often adopt loss costs and rating structures that statistical rating agencies, such as ISO and NCCI, file with state insurance regulators. We typically modify these loss costs or factors based on actuarial analyses of our credible historical statistical data, factoring in loss trends and other expected impacts. We combine the resulting loss costs with expense and profit provisions to develop premium rates. We may use market data, and incorporate business judgment, to supplement the indicated rates to determine our final filed rates.

We use predictive models, which analyze historical statistical data about various risk characteristics that drive loss experience for many of our Standard Commercial Lines and Standard Personal Lines products. Some of these models incorporate traditional artificial intelligence ("AI"). The predictive capabilities of these models depend on the quantity and quality of available statistical data, which we may supplement with other market information, third-party data, and underwriting judgment to refine statistical rating agencies' rating plans or independently develop proprietary rating plans. We use the output of these models to (i) inform the individual risk underwriting and pricing process in Standard Commercial Lines and (ii) develop factors in our filed rating plans in Standard Personal Lines.

Customers and Customer Markets

We categorize our Standard Commercial Lines customers into five strategic business units ("SBUs"):

We do not categorize Standard Personal Lines or E&S Lines customers into SBUs. No one customer accounts for 10% or more of our insurance operations DPW in the aggregate.

Geographic Markets

We sell our insurance products and services by segment in the following geographic markets:

•Standard Commercial Lines products and services, primarily in 36 states and the District of Columbia.

•Standard Personal Lines products and services, primarily in 15 states in the Eastern, Midwestern, and Southwestern regions of the U.S. Flood insurance, reported in this segment, is sold in all 50 states and the District of Columbia.

•E&S Lines products and services, in all 50 states and the District of Columbia.

In 2025, we began writing Standard Commercial Lines business in Kansas. Geographic expansion allows us to compete more effectively against national insurers and diversify our portfolio risk. We expect to enter Montana and Wyoming by the end of 2026, subject to regulatory approvals. While we expect to continue to grow our presence in states where we have recently expanded, our pace of geographic expansion is moderating as we move closer to our goal of operating our Standard Commercial Lines business with a near-national footprint.

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We manage and support our business from several offices, including; (i) Branchville, New Jersey, for corporate functions; (ii) Farmington, Connecticut, the principal office for investment operations; (iii) Hartford, Connecticut, used by our information technology ("IT") department and several other corporate functions; (iv) Richmond, Virginia, where our underwriting and claims service center is located; and (v) six regional branches, listed in the following table:

We have leased a new facility in Short Hills, New Jersey, where many Branchville operations, including our Executive Leadership Team, will be relocating beginning in mid-2026 and continuing through 2029.

Our E&S Lines have offices in Scottsdale, Arizona, and Dresher, Pennsylvania. Our Flood business operates from offices in Branchville, New Jersey, and Miami, Florida. Our Staff Counsel operation, which represents our policyholders in claims litigation, has 11 leased offices primarily located in the Eastern U.S.

Distribution Channel

The property and casualty insurance market is regulated and highly competitive, with fragmented market share, particularly in standard commercial lines and E&S lines. The market has three main distribution methods: (i) sales through appointed independent insurance agents and wholesale brokers; (ii) direct sales to personal and commercial customers, including Internet-based digital platforms; and (iii) sales through captive insurance agents employed by or contracted to sell exclusively for one insurer.

We use independent distribution partners to sell our insurance products and services as follows:

•Standard Commercial Lines: Independent retail agents;

•Standard Personal Lines: Independent retail agents; and

•E&S Lines: Wholesale general agents and independent retail agents.

We seek to compensate our distribution partners fairly and consistently, in line with market practices. Typically, we pay commissions calculated as a percentage of DPW, with supplemental amounts based on profitability and premium growth. No single independent distribution partner is responsible for 10% or more of our insurance operations' premium.

Independent Retail Agents and Standard Lines

A 2024 Independent Insurance Agents & Brokers of America study estimated there are 39,000 independent property/casualty insurance agents and brokers in the U.S., reflecting a 3% decrease from its 2022 study. We expect that independent retail insurance agents – representing most of our distribution partners – will remain a significant force in overall insurance industry premium production. Their business model, which involves representing multiple insurance carriers, provides customers a wider choice of insurance products, more competitive pricing, and individualized risk-based consultation.

Approximately 1,680 distribution partners sell our standard lines products and services through approximately 2,940 office locations. About 730 of these distribution partners sell our Standard Personal Lines products. Approximately 6,520 distribution partners sell our flood insurance products.

Wholesale General Agents, Independent Retail Agents and E&S Lines

We have approximately 80 wholesale general agents with a total of 260 office locations selling our E&S Lines business. These wholesale general agents have been granted limited binding authority for risks meeting our prescribed underwriting and pricing guidelines. They refer risks ineligible for binding authority to our underwriters. In 2025, we expanded our distribution by allowing a limited group of our appointed Standard Commercial Lines independent retail agents access to our E&S offerings through an in-house managing general agent.

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Marketing

Our primary marketing strategy is to:

•Employ a locally-based, empowered field underwriting model for Standard Commercial Lines, placing decision-makers and resources near our customers and distribution partners. We discuss this model further in the "Technology, Innovation, and Operating Model" section below.

•Deploy a distribution model that allows the principals and producers of our high-quality independent insurance agencies to fully realize the significant franchise value of our appointment and their right to sell our Insurance Subsidiaries' products and services. To further enhance value and support profitable growth, we establish meaningful and close business relationships with our distribution partners. This includes (i) soliciting, gathering, and acting on feedback from them and our mutual customers, including about our products and services and brand, (ii) familiarizing them with our new product offerings, and (iii) providing professional education and development programs focused on producer recruitment, sales training, agency perpetuation, customer experience enhancement, online marketing, and distribution operations.

•Develop and carefully monitor annual goals with each distribution partner that involve (i) the types and mix of risks they place with us, (ii) new business and renewal retention expectations and pricing, and (iii) the profitability of the business they place with us.

•Leverage people and technology to improve brand recognition and foster meaningful customer engagement through a data-driven omnichannel marketing strategy that prioritizes delivering a superior customer experience. We expect this integrated marketing and customer engagement approach will position us as an industry leader and (i) afford us a dynamic view of the changing marketplace and customer expectations, (ii) provide us insight into unique value-added products and services that could have the greatest impact on each customer, and (iii) help drive brand health and perception leading to increased retention and business acquisition.

Technology, Innovation, and Operating Model

We continually evolve our technology and operating model to prioritize innovation, a superior omnichannel experience for our customers and distribution partners, and 24/7 digital access to account information and transactional capabilities. While many insurers offer digital customer solutions for personal lines, we strive to be a digital and customer experience leader in all three of our insurance operations segments.

Technology

We use technology extensively in our business, making significant investments in IT platforms, integrated systems, and cloud-based solutions. We employ traditional AI methods, such as machine learning, to increase organizational efficiency and improve decision-making speed and accuracy. This enables us to reallocate resources to initiatives that drive greater value. We are increasingly leveraging general-purpose and industry-trained generative AI solutions that use large language models to improve internal process efficiency and effectiveness. We maintain a cross-disciplinary Artificial Intelligence and Model Governance Committee, accountable to the Executive Risk Committee ("ERC"), to govern the acquisition, creation, deployment, use, and reliance on internal and external models in the execution of insurance activities.

Our technology investments provide:

•Our distribution partners with accurate business information and seamless integration with our systems, enabling easy policy transaction processing;

•Our service representatives with a customer account-centric view of our policyholders, reducing response times for customers and complementing customer access to on-demand digital transactional capabilities;

•Our underwriters with advanced underwriting and pricing tools and predictive models, which provide guidance and automatically retrieve relevant public information on existing and potential policyholders, allowing for quicker decision making and enhanced profitability and premium growth; and

•Our claims adjusters with predictive tools to identify claims likely to involve escalating losses, fraud, subrogation, or attorney representation.

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Our digital strategy offers our Standard Commercial Lines and Standard Personal Lines customers a mobile application and a self-service portal branded as MySelective. Our award-winning mobile application continues to satisfy users, earning a 4.7 out of 5 star rating on the Apple App Store. As of December 31, 2025, 59% of our customers are registered for MySelective. This application gives policyholders on-demand self-service access to account information, electronic bill payment, claims reporting, and a comprehensive risk management center.

We are committed to delivering additional digital value-added services that help customers manage their risks. These include timely notifications about vehicle and product recalls, adverse weather, and claim status. In 2025, we expanded our suite of value-added services to include a plug-in sensor and fire prevention service that monitors for hazards that could lead to electrical fires, along with other detection sensors and telematics.

Our primary technology operations are in Branchville, New Jersey, Hartford, Connecticut, and Charlotte, North Carolina. We have agreements with multiple consulting, IT, and supplemental staffing service providers to augment our internal resources. These providers supply approximately 56% of our skilled technology capacity, with 75% of their resources based overseas. We retain management oversight of all projects and ongoing IT production operations. We have established procedures to manage an efficient transition to any new technology vendors without significantly impacting our operations.

Innovation

We have a dedicated innovation team under our Chief Marketing and Innovation Officer to uphold our culture of innovation and deliver long-term value to our customers and distribution partners. This team applies proven innovation techniques and methods to identify, prioritize, and advance strategic ideas and opportunities. This team also monitors critical industry and insurance technology trends that impact our customers, distribution partners, and employees. By establishing this team, we have expanded our innovation culture through employee training and skill-building, while also facilitating departmental and cross-functional strategy and innovation sessions.

Operating Model

We believe our unique operating model is a competitive advantage. To foster stronger relationships with our independent distribution partners, our Standard Commercial Lines underwriting and risk management professionals are located in the geographic territories they serve. Our Claims operation is organized regionally by specialty, with local personnel responsible for managing our customer, claimant, and distribution partner relationships. In addition, our employees are provided with sophisticated tools and technologies to inform underwriting, pricing, risk management, and claims decisions.

Underwriting Process

Our underwriting process by segment is as follows:

•Standard Commercial Lines: Our Standard Commercial Lines corporate underwriting department oversees our underwriting philosophy and guidelines for each market size, SBU, and line of business. Through formal letters of authority, our Chief Underwriting Officer ("CUO") delegates underwriting authority after assessing an underwriter's job grade and their segment and line of business expertise. Our regional and corporate underwriting teams coordinate with our Actuarial Department to determine adequate pricing levels for all Standard Commercial Lines products.

Under the CUO's delegated authorities, our regional underwriting operations make most individual policyholder underwriting and pricing decisions. New business is underwritten by Agency Management Specialists ("AMSs"), Production Underwriters, Small Business Teams, and Large Account Underwriters. Renewal business is primarily handled in each region with support from our underwriting and claims service center ("USC"). The regions assign AMSs, Production Underwriters, and underwriters to specific distribution partners and the USC assigns underwriters to support specific distribution partners within the USC.

We have 88 field-based Risk Management Specialists who support current and prospective policyholders locally. Their risk management enhancements and best-practice recommendations reduce our customers' exposure to property, liability, and workers compensation risks. Their account-specific analyses enhance our underwriters understanding of coverage exposures and customer risk management, enhancing our new business and renewal underwriting decisions. Our Risk Management Center ("RMC") digitally scales our risk management expertise, offering our Standard Commercial Lines customers seamless, on-demand access to a curated selection of self-service risk management resources. These resources are aligned with the specific insurance coverages we provide and were expanded in 2025 to include risk self-assessments. Our risk management efforts focus on enhancing insured risk management programs, improving loss experience, and increasing retention.

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Our key strategies include:

•Conducting risk evaluation through virtual and on-site improvement surveys and customer-completed assessments within the RMC that evaluate potential exposures and offer mitigation solutions;

•Targeting certain segments and states for higher penetration of Compass, our telematics solution;

•Providing internet-based risk management educational resources, including an extensive library of coverage-specific safety materials, videos, and online courses, such as defensive driving and employee educational safety;

•Performing on-site thermographic infrared surveys that identify potential electrical hazards; and

•Offering Occupational Safety and Health Administration construction and general industry certification training.

Our risk management initiatives include proactively providing policyholders with notifications and alerts, identifying risks, mitigating potential losses, and offering tools and technologies that enhance safety and reduce loss occurrences. Examples of our initiatives include:

•Vehicle recall notifications to our policyholders and distribution partners;

•Advance notices to help prepare for severe weather conditions, including guides on structural improvements, roof and drainage maintenance, and measures to prevent clogged or frozen plumbing and sprinkler systems;

•Food and product recall notifications to policyholders in food manufacturing, distribution, and preparation; and

•Digital customer self-assessments of workplace hazards, with best practice recommendations tailored to the customer's specific risks.

We have continued to modernize and enhance the capabilities of our new Standard Commercial Lines agency interface platform, designed to streamline the quoting and issuance of new small business policies. Writing small business is a core part of our growth strategy, and we define the class as low-hazard risks under specified exposure thresholds, such as property values, payroll, or sales in specific industry classes. In recent years, the small business market has become more competitive, with many carriers using technology to facilitate new business growth. We continue to focus on (i) enhancing the speed and ease of small business writing for our distribution partners and (ii) providing a best-in-class small business customer experience.

We have added additional business capabilities within Standard Commercial Lines small business, including:

•Introducing small business eligibility to new lines of businesses;

•Streamlining the quoting process with data prefill functionality;

•Enhancing the user experience of our rating platform by reducing the amount of required information before quote generation;

•Improving the in-platform user experience to support new small business growth and enable straight-through processing that allows our distribution partners to issue business without underwriter involvement; and

•Integrating with comparative rating tools for specific lines of business in Standard Commercial Lines.

•Standard Personal Lines: Our Standard Personal Lines underwriting operations are centralized and highly automated. Most new and renewal business is underwritten and priced through an automated system using our filed rates and rules. Exceptions to our internal underwriting guidelines are approved under the direction of our Standard Personal Lines CUO. We are actively repositioning our Standard Personal Lines business for the mass affluent market, where we believe our strong coverage and servicing capabilities make us more competitive.

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•E&S Lines: Our E&S Relationship and Underwriting Managers promote our products to wholesale general agents, provide training on underwriting guidelines and automation, and collect market insight. Our wholesale general agents handle new and renewal business in accordance with established guidelines. Any exceptions or declinations are reviewed by our small commercial E&S underwriters, who assess individual account risk characteristics. Middle market accounts exceed our wholesale general agents' authority, and they must be submitted to our E&S commercial underwriters, who make underwriting and pricing decisions based on the submitted information, third-party data, and business judgment.

Our automated small business rate, quote, bind, and issue system for E&S Lines reduces manual touchpoints throughout the policy lifecycle. This allows our agents and underwriting teams to grow their business cost-effectively and efficiently. Underwriting rules embedded in the system qualify the submissions within an agent’s authority and route accounts requiring additional review directly to an underwriter.

Our continued investment in product, operational, and technological enhancements enables and supports growth in our small-commercial and middle-market business. In 2025, we (i) introduced a new specialty lines construction division, including an inland marine team, (ii) invested in operational efficiency, and (iii) began expansion of our distribution capabilities by providing our Standard Commercial Lines independent retail agents direct access to our E&S offerings through an in-house managing general agent.

Our independent distribution partners may designate our USC to service Standard Commercial Lines and Standard Personal Lines accounts. Similar to independent distribution partner employees, all USC employees are licensed agents who respond to policyholder inquiries about insurance coverage, billing transactions, and other matters. Because of the convenience the USC allows, our distribution partners agree to receive a slightly lower-than-standard commission on the associated premium.

Claims Management

Our essential claims service involves evaluating and determining coverage in a timely and appropriate manner. Their evaluation considers the facts and circumstances of the claim and our policy's terms, conditions, and exclusions. To address the increasing complexity of coverage evaluation, construction methods, and litigation, we have structured our claims organization to emphasize:

•Claims handling by technical areas of expertise, such as automobile liability, general liability, property, and workers compensation, with a specialized claims unit for each business line focused on high-severity or technically complex losses and litigation. Claims adjusters within our lines of business are geographically aligned to provide localized expertise;

•Claims agency executives and managers responsible for (i) enhancing the relationship among our policyholders, distribution partners, and claims operation and (ii) providing a single point-of-contact for our large account customers and distribution partners. They work with our regional underwriters to deliver appropriate claims service, communicate trends, and discuss client services;

•Cost-effective delivery of claims services and loss and loss expense control. Dedicated adjusters manage our high volume, low severity automobile and property claims, leveraging virtual adjusting tools that provide prompt and efficient service to our customers; and

•Timely and adequate claims reserving and resolution.

We have been executing a multi-year claims system modernization and process transformation strategy to (i) provide our adjusters with real-time quality data that enables quick coverage decisions, (ii) better monitor adjusting team's workflows, (iii) optimize processes, and (iv) deliver an exceptional customer experience. This strategy also ensures each line of business has an efficient workflow matching claim complexity. We expect (i) reduced cycle times and claims adjudication costs and (ii) improved insured and distribution partner customer service. The modernized system will enable expedited low-touch or no-touch claims processing, depending on the exposure type and severity, and provide improved visibility and transparency throughout the life cycle of a claim file to our insureds, claimants, and distribution partners.

In 2024, we (i) integrated our claims system with key third-party vendors, (ii) introduced a digital payment solution allowing direct fund transfer to insureds, claimants, and vendors, and (iii) increased our payment functionality to allow digital payments to single, multi-party, lien holder, and mortgage payees. In 2025, we implemented a new, modernized claims system for our commercial automobile, personal automobile, general liability, and commercial property lines of business. We intend to expand the system to our workers' compensation and bond lines of business next. In 2026, we intend to continue integrating

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our claims system with key third-party vendors to (i) provide adjusters with efficient access to state-specific regulatory and compliance claims handling requirements, (ii) offer medical canvas, record retrieval, and investigative management tools, and (iii) streamline the First Notice of Loss process. We expect these changes to improve adjusters' efficiency, enhance overall customer experience, and ensure that we match each claim to an appropriately-skilled adjuster.

Our Special Investigations Unit ("SIU") investigates potential insurance fraud and abuse, reporting findings as required to the proper authorities. The SIU's work is governed by applicable law and direction from regulatory bodies and non-profit organizations dedicated to combating and preventing insurance crime. The SIU adheres to uniform internal procedures to improve detection and act on potentially fraudulent claims. We have developed and deployed a proprietary SIU fraud detection model that identifies potential fraud cases early in a claim's life.

Insurance Operations Competition

We face substantial competition in the insurance marketplace from public, private, and mutual insurance companies with varying levels of brand recognition, scale and operational efficiency, capital bases, book of business diversification, and cost of capital. Many competitors rely on independent partners to distribute their products and services. Other insurance carriers employ their agents, who represent only them, or use a combination of independent partners, captive agents, and direct marketing.

The property and casualty insurance market is highly competitive, with fragmented market share, particularly in Standard Commercial Lines and E&S Lines. Our primary competitors are regional and national insurers that use independent agents. We compete on coverage terms, claims handling, customer experience, risk management services, ease of technology use, price, value-added services, and financial strength ratings. However, we also face increased competition from new entrants and established direct-to-consumer insurers.

Investments Segment

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 and (ii) amounts generated through our capital management strategies, including debt and equity security issuances; 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.

Our fixed income securities primarily include corporate securities, collateralized loan obligations and other asset-backed securities, mortgage-backed securities, and state and local municipal obligations. We also invest in public equity securities, commercial mortgage loans, short-term investments, alternative investments, and other investments. Alternative investments primarily include limited partnership investments in private equity, private credit, and real estate strategies. Other investments include Federal Home Loan Bank ("FHLB") stock and tax credit investments.

For further information regarding our risks associated with the overall investment portfolio, see Item 7A. "Quantitative and Qualitative Disclosures About Market Risk." and Item 1A. "Risk Factors." of this Form 10-K. For additional investment information, see the "Investments Segment" section in Item 7. "Management’s Discussion and Analysis of Financial Condition and Results of Operations." and Note 5. "Investments" included in Item 8. "Financial Statements and Supplementary Data." of this Form 10-K.

Regulation

Primary Oversight by the States in Which We Operate

State law primarily regulates insurance and insurer taxation, as delegated by the U.S. Congress in the McCarran-Ferguson Act. The primary public policy behind insurance regulation is protecting policyholders and claimants over all other constituencies, including shareholders. Property and casualty insurance activities regulated by the states include the following:

•Protection of claimants: Oversight of financial matters to ensure claims-paying ability, including minimum capital; statutory surplus; solvency standards; accounting methods; form and content of statutory financial statements and other reports; loss and loss expense reserves; investments; reinsurance; dividend payments and other distributions to shareholders; security deposits; and periodic financial examinations.

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•Protection of policyholders: Oversight of matters including certificates of authority and other insurance company licenses; licensing and compensation of distribution partners; underwriting criteria; premium rates (required not to be excessive, inadequate, or unfairly discriminatory); policy forms; policy terminations; claims handling and related practices; cybersecurity; data protection and customer privacy; reporting of premium and loss statistical information; periodic market conduct examinations; unfair trade practices; mandatory participation in shared market mechanisms, such as assigned risk pools and reinsurance pools; mandatory participation in state guaranty funds; and mandated continuing workers compensation coverage post-termination of employment.

•Protection of policyholders, claimants, and shareholders: Oversight of matters related to our ownership of the Insurance Subsidiaries, including registration of insurance holding company systems in states where we have domiciled insurance subsidiaries, reporting about intra-holding company system developments, self-assessment of current and future risks, including cybersecurity and climate change, and required pre-approval of certain transactions that may materially affect the operations, management, or financial condition of the insurers, including dividends and change in control.

NAIC Financial Monitoring Tools

Our various state insurance regulators are members of the National Association of Insurance Commissioners ("NAIC"), which has established statutory accounting principles ("SAP"), other accounting reporting formats, and model insurance laws and regulations governing insurance companies. An NAIC model statute, however, only becomes law after state legislative enactments, and an NAIC model rule only becomes a regulation after state insurance department promulgation. Adopting specific NAIC model laws and regulations is a condition of the NAIC Financial Regulations Standards and Accreditation Program. This program allows state insurance departments to recognize and rely on the financial examinations and other reviews conducted by their counterparts, creating efficiencies and limiting overlapping examinations of the same insurance companies.

The NAIC's various financial monitoring tools are generally predicated on NAIC model laws and regulations that have been enacted or adopted by regulators in states in which our Insurance Subsidiaries are organized. The following are among the most material to the operations:

•The Insurance Regulatory Information System ("IRIS"). IRIS identifies thirteen (13) industry financial ratios and specifies "usual values" for each. Departures from the usual values on four or more financial ratios can prompt inquiries from individual state insurance departments about certain aspects of an insurer's business. Our Insurance Subsidiaries have consistently met most IRIS ratio tests.

•Risk-Based Capital ("RBC"). RBC is measured by four major property and casualty insurance risks: (i) asset risk; (ii) credit risk; (iii) underwriting risk; and (iv) off-balance sheet risk. Regulators increase their scrutiny, up to and including intervention, as an insurer's total adjusted capital declines below the NAIC-required capital level. Based on our 2025 statutory financial statements prepared in accordance with SAP, all our Insurance Subsidiaries had total adjusted capital substantially exceeding the regulatory action levels defined by the NAIC.

•Group Capital Calculation ("GCC"). The GCC expands the existing RBC calculation to include (i) capital requirements for other regulated entities in the group and (ii) defined capital calculations for other group entities that are unregulated. The calculation provides state insurance regulators with additional analytical information to assess group risks and capital adequacy, complementing the existing holding company disclosures and analyses. Based on our 2025 statutory financial statements prepared in accordance with SAP, our GCC ratio exceeded the regulatory action minimum threshold.

•Annual Financial Reporting Regulation (referred to as the "Model Audit Rule"). The Model Audit Rule, based closely on the Sarbanes-Oxley Act of 2002, as amended ("Sarbanes-Oxley Act"), regulates (i) auditor independence, (ii) corporate governance, and (iii) internal control over financial reporting. As permitted under the Model Audit Rule, the Audit Committee of our Board of Directors ("Board") serves as the audit committee of each of our Insurance Subsidiaries.

•Own Risk and Solvency Assessment ("ORSA"). ORSA requires an insurer to maintain a framework for identifying, assessing, monitoring, managing, and reporting "material and relevant risks" associated with the insurer's (or insurance group's) current and future business plans. ORSA, adopted by the state domicile insurance regulators of our Insurance Subsidiaries, requires an insurer to file an annual internal assessment of the adequacy of its risk management

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framework and its current and projected solvency position. For more information on our internal process of assessing our significant risks, refer to the "Corporate Governance, Sustainability, and Social Responsibility" section below.

NRSROs

Rating agencies, although not formal regulators, monitor our capital adequacy. Two are (i) AM Best, with its Best Capital Adequacy Ratio ("BCAR") model, and (ii) S&P, with its capital model. Both evaluate insurer balance sheet strength, comparing available capital to estimated required capital at various probability or rating levels. BCAR and the S&P model differ from the NAIC financial monitoring tools, particularly RBC. While RBC, the BCAR model, and the S&P capital model show similar direction as scenarios change, they react differently to variations in economic conditions, underwriting and investment portfolio mix, and capital. We regularly evaluate our capital adequacy relative to these capital models to ensure we can effectively pursue our business strategies. Rating agencies also revise their capital adequacy models and requirements more frequently than the NAIC updates its financial monitoring tools.

Federal Regulation

While primarily regulated at the state level, our business is subject to federal laws and regulations, including:

•The McCarran-Ferguson Act;

•The Terrorism Risk Insurance Program Reauthorization Act ("TRIPRA");

•The NFIP, overseen by the Mitigation Division of the Federal Emergency Management Agency;

•The Medicare, Medicaid, and SCHIP Extension Act of 2007, which subjects our workers compensation business to Mandatory Medicare Secondary Payer Reporting;

•The economic and trade sanctions of the Office of Foreign Assets Control;

•Various privacy laws related to possessing personal non-public information, including the following:

◦Gramm-Leach-Bliley Act;

◦Fair Credit Reporting Act;

◦Drivers Privacy Protection Act; and

◦Health Insurance Portability and Accountability Act.

•The Sarbanes-Oxley Act and the Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank Act”) govern publicly-traded companies. These laws require or permit national stock exchanges or associations, such as the Nasdaq Stock Market LLC, where we list our equity securities, to mandate certain governance practices.

The Dodd-Frank Act, enacted in 2010 in response to the 2008 and 2009 financial market crises, provided for some public company corporate governance reforms and some oversight of the business of insurance, including:

•Establishing the Federal Insurance Office ("FIO") under the U.S. Department of the Treasury; and

•Granting the Federal Reserve oversight of financial services firms designated as systemically important.

The FIO, consistent with its authority under the Dodd-Frank Act (i) negotiated a covered agreement with the European Union that, among other things, impacted reinsurance collateral requirements for foreign reinsurers and (ii) has been gathering insurance market data.

For additional information on regulation and the potential impact of regulatory changes on our business, refer to the regulation risk factor within Item 1A. "Risk Factors." of this Form 10-K.

Corporate Governance, Sustainability, and Social Responsibility

We strive to maintain high ethics and integrity in our business practices. Our focus includes understanding and mitigating risk, serving customers and distribution partners responsibly, enabling our employees’ professional development and work/life balance, being environmentally responsible, and helping the communities where we live, work, and serve.

Corporate Governance

Strong governance, oversight, and transparency form the foundation of our financial and operating success. Our mature risk culture and governance structure are cornerstones of our risk management framework, designed to enhance decision-making and strengthen risk-reward evaluations.

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Our internal control framework follows the Committee of Sponsoring Organizations of the Treadway Commission (COSO) model, deploying three lines of defense:

•The first line of defense consists of the individual business functions that deliberately assume, own, and manage the risk on a daily operational basis.

•The second line of defense focuses on risk oversight, supporting the first line in understanding, monitoring, and managing our risk profile through our ERC and dedicated risk team led by our Chief Risk Officer ("CRO").

•The third line of defense is our Internal Audit team, which offers independent, objective assurance regarding the adequacy and effectiveness of our internal control environment with oversight from our Board's Audit Committee. Internal Audit also coordinates risk-based audits, compliance reviews, and other targeted initiatives to evaluate and address risk in specific business areas.

Our risk governance structure consists of the following major components:

Board Oversight

Oversight and guidance are our Board's primary functions. The Board and its committees ("Board Committees") oversee our business performance and the management team ("Management"). The Board reviews and discusses Management reports about our performance, strategy, risks, and significant issues. Eleven of twelve Board members are independent.

Our Board oversees our Enterprise Risk Management ("ERM") process, and all Board Committees oversee risks specific to their areas of supervision and report their activities and findings to the entire Board. The Board's Risk Committee oversees our ERM framework and practices and assists the Board in overseeing our operational activities and identifying and reviewing related risks.

Management and Operating Committees

Our Chief Executive Officer ("CEO") directs the implementation of our business strategy. Management regularly reports to the Board on significant events, issues, and risks that may materially affect our business or financial performance. A description of each Management committee and our ERM function follows:

•Management Investment Committee ("MIC") - Responsible for (i) setting and implementing the investment objectives and asset allocation, (ii) approving and overseeing compliance with investment policies, (iii) selecting qualified external investment managers and advisors, and (iv) monitoring performance, transactions, and specific risk metrics. Our investment team and external investment managers execute our investment strategy and objectives. The MIC meets quarterly and as needed, and provides the Board's Finance and Investments Committee with quarterly reports.

•Underwriting Committee - Responsible for (i) establishing and reviewing authority levels of the CUOs and (ii) reviewing and making decisions on any underwriting transaction and/or action outside the CUO's authority. The Underwriting Committee oversees the distribution of underwriting authority across our insurance operations. This committee meets as needed and evaluates various information related to specific accounts, including underwriting, risk management, claims, and market considerations, as well as projected catastrophe modeling metrics when considering a

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large property account. Annually, the Board's Risk Committee receives quality assurance reports focused on underwriting guidelines and authority. The Risk Committee reviews underwriting metrics quarterly.

•Enterprise Project Management Office ("EPMO") - Responsible for the review, approval, and continued oversight of large, strategic, transformational, or high-risk projects. Our EPMO framework is based on the Project Management Institute leading practices. Projects above a certain dollar threshold require Board approval. The EPMO includes senior management representatives from all primary business and corporate areas. It meets regularly to review all significant initiatives, receive status reports, and approve project requests.

•Large Claims Committee - Reviews and approves all claim loss or loss reserves or payments above the Chief Claims Officer's authority. Claims that (i) have or are likely to exceed a reinsurance policy coverage limit, (ii) have bad faith exposure of $15 million or more, (iii) are likely to generate significant press interest or have a reputational impact, or (iv) potentially create a significant legal precedent on an insurance coverage issue are reported to the Board's Audit Committee. The Large Claims Committee meets as needed.

•Reserve Committee - Responsible for monitoring loss and loss expense reserve levels and taking management actions on financial recording of reserves. The Reserve Committee reports reserve indications and actions to the Board, and its Audit Committee. Key reserve metrics are also reported to the ERC and the Board's Risk Committee. The Reserve Committee meets quarterly and as needed.

•Executive Risk Committee - Responsible for evaluating and supervising our risk profile and determining future risk management actions supporting our overall risk profile. The ERC provides management oversight of our ERM function and relies on several management committees to analyze and manage specific major risks. The ERC meets quarterly and as needed, reviewing various topics and the interrelation of our significant risks, including capital modeling results, capital adequacy, risk metrics, emerging risks, and sensitivity analysis. The Board's Risk Committee receives quarterly reports on enterprise and emerging risks.

•Disclosure Committee - Responsible for establishing and implementing procedures to ensure compliance with Regulation FD and other applicable securities laws. This committee meets quarterly and as needed, and reports quarterly to the Board's Audit Committee.

•Market Security Committee - Responsible for reinsurance purchase decisions, reinsurer counterparty risk assessment, approval of individual reinsurers' placement on our treaties, and catastrophe risk monitoring. The MSC is comprised of executives and senior leaders with diverse financial and underwriting expertise. It meets semiannually, before each major treaty renewal and as needed. The MSC updates the Board's Risk Committee at least semiannually on reinsurance purchases, market trends, and changes in treaty structure, terms, and conditions. For any reinsurance-related catastrophe bond issuance, the Board’s Finance and Investments Committee reviews and approves any related security offerings.

ERM Function

The ERM unit identifies, measures, monitors, and reports key and aggregated enterprise-wide risks to the ERC, the Board and its Risk Committee. The ERM unit collaborates with other functional areas to develop appropriate responses to identified risks and support the successful execution of our business strategies.

We rely on quantitative and qualitative tools to identify, prioritize, and manage our major risks, including proprietary and third-party computer modeling and other analyses. When appropriate, we engage subject matter experts, such as external actuaries, third-party risk modeling firms, and IT and cybersecurity consultants. Our Insurance Subsidiaries submit an annual ORSA summary report to their domiciliary state insurance regulators. ORSA includes an internal prospective solvency assessment developed by the CRO, in coordination with the ERC, that our Board reviews.

We categorize our major risks into five broad categories:

•Asset risk, arising primarily from our investment portfolio, reinsurance recoverables, and other receivables including credit and market risk;

•Underwriting risk, which is the risk our insured losses exceed our expectations, and includes:

◦Losses from inadequate loss reserves;

◦Larger than expected non-catastrophe current accident year losses; and

◦Catastrophe losses that exceed our expectations or our reinsurance treaty limits.

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•Liquidity risk, which is the risk we will be unable to meet our contractual obligations as they become due because we cannot liquidate assets or obtain adequate funding without incurring unacceptable investment losses or borrowing costs;

•Other risks, which include a broad range of risks, many difficult to quantify, like talent/human capital; market conditions; operational, economic, legal, regulatory, reputational, and strategic risks; and the risks of fraud, human failure, modeling, inadequate business continuity plans, and failure of controls or systems, including over cybersecurity risk; and

•Emerging risks, which include risks in any category that are new, known, but evolving rapidly, or increasing substantially compared to historical levels. For example, we consider emerging risks to include (i) heightened levels of economic and social inflation, (ii) the enactment of reviver statutes for abuse victims, (iii) climate change, (iv) the increased threat of cyber incidents, and (v) the increased use of artificial intelligence.

The table below maps our management and operating committees to their responsibilities for our five major risks.

Our risk governance structure facilitates effective risk conversations across all levels and disciplines of the organization, promoting strong risk management practices. However, all our strategies and controls have inherent limitations. We cannot be certain an event or series of unanticipated events will (i) occur or not occur and generate losses greater than we expect and (ii) have a material adverse effect on our results of operations, liquidity, financial condition, financial strength, and debt ratings. Investors should carefully consider the risks and all other information in Item 1A. "Risk Factors.," Item 7A. "Quantitative and Qualitative Disclosures About Market Risk.," and Item 8. "Financial Statements and Supplementary Data." of this Form 10-K.

Sustainability and Social Responsibility

We integrate sustainability principles into our business and partner with key stakeholders to develop solutions that enhance resilience, well-being, and customer service. Focus areas include (i) developing our human capital to create a highly engaged and inclusive team of employees and leaders who will guide us into the future, (ii) understanding and addressing the environmental impact climate change has or could have on our business and operations, and (iii) providing customers with empathetic claims service and risk mitigation solutions.

Human Capital

We understand that investing in our workforce and fostering a positive employee experience enhances our team's well-being and contributes to superior, longer-term financial performance. We are committed to maintaining a safe and inclusive workplace for our approximately 2,800 employees. In 2025, we were (i) designated as a Great Place to Work CertifiedTM organization for the sixth consecutive year and (ii) recognized by Forbes as one of "America's Best Mid-Size Employers" for the fifth time.

Physical, Social, and Financial Well-Being of our Employees

We prioritize our employees' physical, social, and financial well-being, and in doing so, it helps us attract and retain superior talent. We are committed to paying competitively, regularly analyzing compensation, and taking appropriate action to support internal equity and external market alignment.

Our financial benefit programs are designed to support the fiscal health of our employees and their families. These include a 401(k) plan with non-elective and employer matching contributions, an employee stock purchase plan with discounted pricing, and tuition reimbursement and student loan repayment programs. Most employees are eligible to participate in our annual cash incentive program, funded and paid based on their performance and our achievement of established financial and strategic objectives. Employees of certain levels are also eligible to participate in our long-term stock-based incentive compensation program, and a non-qualified deferred compensation plan.

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We also offer competitive and convenient health and wellness programs. To support our employees' social and emotional well-being, we encourage connections with their colleagues and communities through various programs, including paid time off for volunteering, matching charitable donations, employee engagement events, employee resource and affinity groups, and unique programming to meet employee needs.

Talent Development and Employee Retention

We dedicate significant time and resources to (i) training and development, enabling our employees to fulfill their professional potential and have rewarding careers and (ii) retaining our best talent and fostering a positive work-life balance. We are committed to ongoing employee learning, personal growth, and continuous improvement. Our employees have access to a wide range of resources, including live instructor-led and online skills training courses. We also have leadership and talent development programs and initiatives for all levels of the organization. Examples include our (i) Next Generation of Leaders program, which identifies early- and mid-career management opportunities for focused development and future senior leadership preparation, (ii) RISE (Retain Include Support Engage) program, an accelerated professional development program for individual contributors interested in first-level management positions, (iii) Accelerate program, which provides training for new managers on leadership skills and techniques, and (iv) our Ignite Internship and Momentum Trainee programs, which are early career programs that help develop our future talent pipeline.

As of December 31, 2025, we had approximately 2,800 employees; 1,380 were home-based, 810 were in our regional offices, and the remainder were in our corporate office. Our Flexible Work Location Policy requires most office-based non-management employees to be in their assigned office 40% of the time, and management employees in the office 60% of the time. Our 2025 employee turnover rate was approximately 12%, compared to approximately 10% in 2024. Employees with over 20 years of service represented approximately 13% of our workforce.

Engagement and Inclusion

Building a connected, accountable and empowered organization by developing talent and aligning on prioritized goals is one of our organizational priorities. We employ strategies to create an inclusive workplace culture and attract and retain employees through recruiting, onboarding, training, promotion practices, professional development, engagement surveys, retention interviews, employee resource groups, and competitive compensation and benefits. Collaboration among employees with varied backgrounds fosters innovation, improving operational performance, product development, customer experience, market opportunities, and profitability. We are committed to initiatives that promote inclusion regardless of ethnicity, race, religion, age, veteran status, sexual orientation, gender identity, disability or socio-economic background. Inclusive leadership training is made available to all newly promoted officers, managers, and supervisors. These efforts aim to enhance engagement and create a workplace where everyone feels valued and empowered. At the Board level, the CGNC manages a robust process to recruit new directors with a broad range of skills, expertise, industry knowledge, perspectives, and opinions.

As of December 31, 2025, women represented (i) 57% of our non-officer workforce, consistent with the prior year, and (ii) 37% of our officer workforce, up one point from prior year. Our officer and non-officer ethnic diversity is consistent with the national average for financial services. Approximately 75% of our workforce was White at year-end 2025, compared to 76% at year-end 2024, and 25% were a combination of Black, Latin, Asian, and all other ethnicities at year-end 2025, compared to 24% at year-end 2024.

Environmental

Our Insurance Subsidiaries protect individuals and businesses against the financial impact of covered losses, including from catastrophic events. Climate change increases the unpredictability of weather-related loss frequency and severity, posing a long-term risk to our customers’ businesses and lives – and our profitability. We aim to mitigate climate change impact by (i) prudently overseeing and managing catastrophe risk exposure, (ii) providing our customers with responsive claims handling, risk management services, and proactive weather alerts, (iii) preparing for the continuing transition to clean energy, and (iv) reducing our carbon footprint. Understanding and helping mitigate climate change risks to our business and customers is core to our operations and strategy. We believe these efforts (i) demonstrate responsible corporate action to mitigate climate change impact and (ii) will contribute to sustained superior financial and operating performance over time that will reward our shareholders.

The ERC identified climate change as a "high" level emerging risk and management reviews it at least quarterly with the Risk Committee of the Board. The ERM unit, the ERC, and Management stay informed about key climate change risk developments through industry publications, webinars, conferences, and regular engagement with outside sources, such as our reinsurance brokers, investment managers, trade associations, lawyers, and consultants.

Our ERM function is responsible for measuring, assessing, and monitoring the mitigation of climate change-related physical and transition risks. Physical risks arise from the changing frequency, severity, and characteristics of acute events, like severe

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convective storms, hurricanes, floods, and wildfires. These risks can directly affect our underwriting results, the long-term viability of specific business lines we write, and our investment portfolio. Transition risks arise as the world progresses towards a low-carbon economy, driven by (i) government policy and regulation, (ii) advances in low-carbon technology, and (ii) shifting societal preferences and public sentiment.

Due to our business risk profile and geographic concentration in the Northeast and Mid-Atlantic states, hurricane peril is our most significant natural catastrophe exposure, driving the "tail" of our modeled catastrophe loss distribution. This risk has influenced our decision to diversify our underwriting portfolio geographically and establish rigorous coastal property exposure guidelines. We seek to manage our exposure to other non-hurricane perils, such as severe convective storms, winter storms, flooding, and wildfires. We do not write crop insurance, have minimal exposure to private flood, and have a limited percentage of our geographic exposures in the Western U.S., all limiting our exposures to other weather-related perils, such as droughts, wildfires, and flooding. We monitor our investment exposure to carbon-intensive industries to measure our vulnerability to climate-related risks involved with the transition to a low-carbon economy.

The ERM unit assesses our catastrophe risk exposure relative to our established tolerances. This evaluation incorporates the results of third-party vendor models and proprietary analysis of exposure to hurricanes and other perils on a gross and net basis. For quantitative information on the modeled results of our underwriting property portfolio by peril, refer to the "Reinsurance" section in "Results of Operations and Related Information by Segment" of Item 7. "Management’s Discussion and Analysis of Financial Condition and Results of Operations."

Managing Climate-related Risks

For information about our risks associated with climate change, refer to risks identified with the symbol "" in Item 1A. "Risk Factors." of this Form 10-K.

Insurance Operations

In managing our insurance operations' physical climate-related risks, we model our property portfolio for (i) hurricanes, winter storms, wildfires, and other wind events semiannually in January and July and (ii) earthquakes, a significantly lower exposure for our portfolio than hurricanes and other wind events, annually in July. For some time, we have not underwritten specific environmentally-hazardous risks related to production from coal mines, thermal coal plants, or oil sands extraction because they fall outside our underwriting appetite.

Our underwriting controls employ authority levels for large individual property risks and large property accounts that could create or exacerbate a property aggregation issue. Any individual location exceeding the CUO's property limit authority must be approved by the Underwriting Committee, comprised of the Standard Lines Chief Operating Officer, Chief Financial Officer, Standard Commercial Lines CUO, Executive Vice President of E&S Lines, and CRO. When considering large property accounts, the Underwriting Committee typically (i) reviews an evaluation of property aggregations by county and state and projections of marginal impact on our aggregate modeled losses, assuming we wrote the risk and (ii) discusses our catastrophe risk aggregation appetite and the appropriate pricing for taking the increased risk aggregation.

We believe that we have created an effective control environment for managing gross natural catastrophe risk exposure by (i) setting overall portfolio growth expectations, (ii) monitoring actual results and property aggregations, (iii) having appropriate underwriting authority controls around our largest accounts, and (iv) consistently focusing on appropriate pricing of catastrophe risk.

Our established catastrophic risk tolerance requires that no more than 10% of stockholders’ equity be exposed to a loss from a hurricane event at a 99.6% confidence level (1-in-250-year event or 0.4% probability), on a net-of-reinsurance and after-tax basis. For additional quantitative and qualitative information about our modeled results by scenario on stockholders' equity, refer to the "Reinsurance" section in "Results of Operations and Related Information by Segment" of Item 7. "Management’s Discussion and Analysis of Financial Condition and Results of Operations."

Property insurance presents the primary climate-related risk in insurance operations. However, we have potential climate-related claims under liability policies, such as directors' and officers' ("D&O") liability insurance policies. We monitor these liability risks, but we partially mitigate our liability-related climate exposure through our (i) D&O appetite selection, which includes no public companies or financial institutions, (ii) focus on writing business with small regional footprints and avoiding environmentally-hazardous risks, and (iii) reinsurance, which covers claims in excess of our $3 million casualty reinsurance retention.

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Investments

We incorporate sustainability considerations into our robust investment due diligence processes. To establish appropriate sustainability investment governance, we maintain (i) a well-diversified portfolio across issuers, sectors, and asset classes and (ii) a high credit quality fixed income securities portfolio with a duration and maturity profile at an acceptable risk level that provides ample liquidity. In addition, we collaborate with our third-party investment managers to ensure they incorporate sustainability guidelines and protocols into their investment processes for our mandates. Our investment strategy considers climate change risk by prohibiting any new direct equity or debt investments in thermal coal enterprises, including those generating 30% or more of their (i) revenue from the ownership, exploration, mining, or refining of thermal coal, or (ii) electricity generation from thermal coal. We believe that as the world transitions to a low-carbon economy, the value of these assets could be at greater risk.

Other

In addition to mitigating insurance operations and investment risk, we:

•Have robust plans to ensure operational continuity if we suffer unforeseen or catastrophic events. We have business continuity plans in place for our key data processing facility (Disaster Recovery Plan), the leadership team (Executive Crisis Management Plan), and significant operational areas. We review, update, and test these plans at least annually. Our tests include "tabletop" exercises and planned hands-on tests.

•Track our Scope 1 and Scope 2 greenhouse gas ("GHG") emissions, which are low relative to entities in other industries because we are an insurance holding company. Our Scope 1 emissions include consumption of natural gas, diesel, refrigerant, and the fuel used by employees for work-related travel in company cars. Our Scope 2 emissions are tied to our electricity use.

•Built solar photovoltaic systems mounted on the ground and the garage at our Branchville office. In 2025, these systems generated approximately 3.3 million kWh of electricity, which we sell to others, together with the right to state that we use renewable energy.

Ongoing Initiatives

We plan to continue reducing our carbon emissions relative to our revenues over the long term. We develop initiatives that we expect will reduce GHG emissions over time. Some include:

•Upgrading our Branchville office building management system, which should reduce heating and cooling natural gas consumption;

•Making efforts to transition our company cars from gasoline to hybrid vehicles; and

•Migrating our information technology systems from our Branchville data center to the cloud.

We have also implemented several initiatives at our Branchville office to lower our environmental impact, including:

•Enhanced waste management and recycling;

•Reducing the use of paper within our business;

•Conversion of all Branchville office light bulbs to LED;

•Hybrid work schedule;

•Repurposing commingled recyclables;

•Installed electric vehicle charging stations for employee use;

•Elimination of Styrofoam products in our cafeteria;

•Recycling and more efficient energy use of electronic equipment; and

•Reducing our water usage through automatic plumbing features.

Reports to Security Holders

We file with the U.S. Securities and Exchange Commission ("SEC") all required disclosures, including our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, Proxy Statements, and any amendments to these reports that we file or furnish pursuant to Sections 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, which are accessible on the SEC's website, www.SEC.gov. These filings are also available at www.Selective.com shortly after filing such material with the SEC. Our website and the information contained or linked in it are not part of this Annual Report.