Selective leans into AI and tighter underwriting as premiums slip
Selective hosted its earnings call on Thursday, outlining a strategy centered on AI adoption and tighter portfolio management.
Premiums declined 1% year over year, with E&S up 1% and Standard Commercial Lines down 1%. Personal Lines fell 6%, while the mass affluent segment grew 1%.
Contractors remain a key vertical, but exposure in new business is being reduced to improve diversification and margin durability. On renewals, Selective is applying more granular underwriting and pricing, cutting underperforming accounts and retaining stronger risks, which is already improving loss ratios.
“Our relative exposure to contractors has declined within our new business mix, reflecting our efforts to diversify and improve margin durability. Contractors remain an important industry vertical for us, and we maintain differentiated expertise in serving them. However, a more diversified portfolio positions us better for long-term performance. “
As background, Selective’s core focus is artisan contractors rather than large construction accounts.
AI is becoming embedded across operations. A claims ingestion tool has processed over 500,000 documents, while an underwriting tool evaluates contractual risk transfer with over 90% of results delivered within two minutes, allowing faster and more consistent decisions.
“We continue to invest in capabilities that support scale, diversification and profitable growth. Artificial intelligence strategically enables these efforts. Early AI achievements in claims, underwriting and risk management are delivering measurable outcomes in accuracy, speed and productivity, positioning us to responsibly scale AI across the organization. A significant portion of our strategic technology investments in 2026 is focused on improving risk selection, pricing accuracy and productivity. While we have deployed many AI tools and are evaluating more, I would like to highlight 2 that are having a meaningful impact in driving better, more consistent outcomes while also improving productivity. Our AI claims ingestion tool has processed more than 0.5 million documents, letting our adjusters focus on higher-value work. We also have deployed automation to support evaluation of contractual risk transfer adequacy, a key element of the underwriting process for contractors with over 90% of results returned by the tool within 2 minutes. These tools are supported by a governance program with a cross-disciplinary AI and model governance committee and a focus on human-in-the-loop engagement for AI outputs. These safeguards help us drive accuracy, quality and trust as we scale AI responsibly across the enterprise. We are excited about the opportunities ahead and confident in our ability to execute with discipline.”
Loss trends remain elevated in commercial auto, particularly in New Jersey, with additional pressure in South Carolina. Commercial retention stands at 82%, down three points year over year due to deliberate pruning of weaker accounts.
