Selective Quarterly Income Down 22 Percent

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NU Online News Service, May 7, 2:47 p.m.EDT?Selective Insurance Group's first-quarter incomedropped by 22 percent to $8 million, or 29 cents per share, drivendown by catastrophe losses from East Coast storms this pastwinter.

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In the same period last year, the Branchville, N.J.-basedinsurer had a net profit of $10.3 million, or 39 cents pershare.

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The company said its first-quarter catastrophe losses, on anafter-tax basis, were around $7.7 million, up from the $1.1 millionloss figure for 2002 first quarter.

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Selective's statutory combined ratio for this year's firstquarter also deteriorated, to 104.4 percent from 102.7 percent oneyear ago. Included in the first-quarter 2003 ratio, Selectiveadded, is 4.4 points of CAT losses, compared with 0.7 points forlast year's first quarter.

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Gregory E. Murphy, chairman and chief executive officer atSelective, offered a positive forecast for the rest of 2003 despitethe decline in the first-quarter earnings on the year-over-yearbasis.

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"Although property results were impacted by extreme weather inJanuary and February, we continue to expect solid premium growth in2003, building off our strong 2002 performance," Mr. Murphysaid.

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He added that the 2003 first quarter was the twelfth straightquarter of double-digit price increases. "There is still pricingpower in commercial lines, which accounts for over 83 percent ofour total premium volume," he said.

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Mainly targeting small- and mid-sized businesses and governmententities, Selective's commercial policies include workers'compensation, commercial auto, property and liability insurance,while the company's personal lines include homeowners and auto. Italso offers flood insurance and managed care services.

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