8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT PURSUANT

TO SECTION 13 OR 15(D) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported) July 29, 2009

SELECTIVE INSURANCE GROUP, INC.
(Exact name of registrant as specified in its charter)
New Jersey	001-33067	22-2168890
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)
40 Wantage Avenue, Branchville, New Jersey		07890
(Address of principal executive offices)		(Zip Code)
Registrant's telephone number, including area code		(973) 948-3000
Not Applicable
(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Section 2 – Financial Information

Item 2.02. Results of Operations and Financial Condition.

On July 29, 2009, Selective Insurance Group, Inc. (the “Company”) issued a press release announcing results for the second quarter ended June 30, 2009.  The press release is attached hereto as Exhibit 99.1.

Section 7 – Regulation FD

Item 7.01.            Regulation FD Disclosure.

Attached as Exhibit 99.2 is supplemental financial information about the Company.

The information contained in this report on Form 8-K, including the exhibits attached hereto, is being furnished and shall not be deemed “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing.  The Company makes no admission as to the materiality of any information in this report or the exhibits attached hereto.

Section 9 – Financial Statements and Exhibits

Item 9.01.            Financial Statements and Exhibits.

(d) Exhibits

99.1 Press Release of Selective Insurance Group, Inc. dated July 29, 2009

99.2 Supplemental Investor Package, Second Quarter 2009

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	SELECTIVE INSURANCE GROUP, INC.
Date:  July 29, 2009	By:	/s/ Michael H. Lanza
		Michael H. Lanza
		Executive Vice President and General Counsel

EXHIBIT INDEX

Exhibit No.	Description
99.1	Press Release of Selective Insurance Group, Inc. dated July 29, 2009
99.2	Supplemental Investor Package, Second Quarter 2009

EX-99.1

40 Wantage Avenue Branchville, New Jersey 07890 www.selective.com

For release at 4:15 p.m. (ET) on July 29, 2009

Investor Contact: Jennifer DiBerardino

973-948-1364, jennifer.diberardino@selective.com

Media Contact: Gail Petersen

973-948-1307, gail.petersen@selective.com

Selective Insurance Group Reports

Second Quarter 2009 Earnings

Branchville, NJ – July 29, 2009 - Selective Insurance Group, Inc. (NASDAQ: SIGI), today reported its financial results for the second quarter ended June 30, 2009.  Net income for the quarter was $0.29 per diluted share and operating income for the quarter was $0.43 per diluted share.  Book value was up 4% for the quarter at $17.85 per share.  Net investment income, after tax, was $21.9 million, down 27% compared to a year ago, primarily due to alternative investment losses.

“We are posting solid results this quarter due to continued strong insurance operations,” said Selective Chairman, President and CEO Gregory E. Murphy.  “Our statutory combined ratio of 98.8% was the culmination of excellent commercial lines property results and favorable casualty reserve development.  Gains in commercial lines new business of 12% are partially the result of our increased underwriting diversification.  New business in our non-contractor segments has grown, including Manufacturing which was up 50% and Specialty which was up 40% over the first six months last year.”

“Most notable this quarter is the positive renewal rate movement of 0.6% in commercial lines that beat our expectations,” continued Murphy.  “This is the first quarterly increase in commercial lines renewal pure pricing since the first quarter of 2005.  Our commercial lines pricing power is a key driver to overall underwriting improvements in profitability.”

Selective’s second quarter 2009 highlights, compared to second quarter 2008:

· Net income was down 45% to $15.7 million, or $0.29 per diluted share, compared to $28.7 million, or $0.54 per diluted share;

-more-

· Net realized losses on investments were $7.3 million, after tax, or $0.14 per diluted share, including non-cash other–than-temporary impairments of $12.5 million, pre-tax, compared to a gain of $1.2 million, or $0.02 per diluted share, including non-cash other-than-temporary impairments of $9.8 million, pre-tax;

· Operating income1 was down 16% to $23.0 million, or $0.43 per diluted share, compared to $27.4 million, or $0.52 per diluted share;

· Combined ratio: GAAP: 98.3% vs. 99.8%; Statutory: 98.8% vs. 98.7%;

· Total net premiums written (NPW) were down 6% to $365.3 million;

o Commercial lines NPW were down 8% to $306.7 million;

o Personal lines NPW were up 4% to $58.6 million;

· Catastrophe losses were $3.4 million, after tax, vs. $8.7 million, after tax; and

· Net investment income, after tax, decreased 27% to $21.9 million.

“It is still a very competitive commercial lines marketplace and we’re concentrating on the factors we can control such as using predictive modeling on all lines of business, leveraging our excellent agency relationships, proactively managing expenses, increasing personal lines rates and reducing loss costs in Claims,” said Murphy.  “As the economy stabilizes, the drag from return audit and endorsement premium will be mitigated.  This, combined with a stronger pricing environment, should contribute to overall premium growth.”

Selective’s alternative investment portfolio incurred losses during the second quarter of 2009 of approximately $5.8 million, after tax, compared to a gain of $0.2 million, after tax, during the same period in 2008.  Results for these investments are generally received on a one quarter lag.  While down approximately 6%, pre-tax, for the quarter, this portfolio significantly outperformed the first quarter results of the S&P 500 index which declined approximately 11%.

For the six months ended June 30, 2009, compared to the first six months of 2008:

· Net income was $2.8 million, or $0.05 per diluted share, compared to net income of $49.2 million, or $0.92 per diluted share;

· Net realized losses on investments were $23.0 million, after tax, or $0.43 per diluted share, including non-cash other-than-temporary impairments of $39.6 million, pre-tax, compared to a gain of $2.2 million, or $0.04 per diluted share, including non-cash other-than-temporary impairments of $9.8 million, pre-tax;

· Operating income was $25.8 million, or $0.48 per diluted share compared to operating income of $46.9 million, or $0.88 per diluted share;

· GAAP combined ratio: 99.6% vs. 99.6%; Statutory combined ratio: 99.5% vs. 98.5%;

· Total NPW were down 5% to $741.0 million for the six months ended June 30, 2009;

o Commercial lines NPW were down 6% to $632.0 million;

o Personal lines NPW were up 3% to $109.0 million; and

· Catastrophe losses were $4.3 million, after-tax, compared to $11.8 million, after-tax.

-more-

Balance Sheet and Guidance

At June 30, 2009, Selective’s assets reached $5.0 billion, including $3.6 billion in the company’s investment portfolio.

The company’s Board declared a $0.13 per share quarterly cash dividend on Selective’s common stock, payable September 1, 2009 to stockholders of record as of August 14, 2009.

Guidance for the year is being positively revised based on better than expected results year to date to a GAAP and statutory combined ratio below 101.5%.  This includes assumptions of catastrophe losses of 1.4 points for 2009 and no reserve development, favorable or unfavorable.

The supplemental investor packet, including financial information that is not part of this press release, is available on the Investors’ page of Selective’s public website at www.selective.com.  Selective’s quarterly analyst conference call will be simulcast at 8:30 a.m. ET, on July 30, 2009 at www.selective.com. The webcast will be available for rebroadcast until the close of business on August 27, 2009.

About Selective Insurance Group, Inc.

Selective Insurance Group, Inc. is a holding company for seven property and casualty insurance companies rated “A+” (Superior) by A.M. Best. Through independent agents, the insurance companies offer primary and alternative market insurance for commercial and personal risks, and flood insurance underwritten by the National Flood Insurance Program.  Other subsidiaries of the company provide human resource administration outsourcing. Selective maintains a website at www.selective.com.

Forward-Looking Statements

In this press release, Selective and its management discuss and make statements based on currently available information regarding their intentions, beliefs, current expectations, and projections regarding Selective's future operations and performance.

Certain statements in this report, including information incorporated by reference, are “forward-looking statements” as that term is defined in the Private Securities Litigation Reform Act of 1995 ("PSLRA").  The PSLRA provides a safe harbor under the Securities Act of 1933 and the Securities Exchange Act of 1934 for forward-looking statements.  These statements relate to our intentions, beliefs, projections, estimations or forecasts of future events or our future financial performance and involve known and unknown risks, uncertainties and other factors that may cause our or our industry’s actual results, levels of activity, or performance to be materially different from those expressed or implied by the forward-looking statements.  In some cases, you can identify forward-looking statements by use of words such as “may,” “will,” “could,” “would,” “should,” “expect,” “plan,” “anticipate,” “target,” “project,” “intend,” “believe,” “estimate,” “predict,” “potential,” “pro forma,” “seek,” “likely” or “continue” or other comparable terminology.  These statements are only predictions, and we can give no assurance that such expectations

-more-

will prove to be correct.  We undertake no obligation, other than as may be required under the federal securities laws, to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Factors that could cause our actual results to differ materially from those projected, forecasted or estimated by us in forward-looking statements, include, but are not limited to:

· difficult conditions in global capital markets and the economy;

· continued deterioration in the public debt and equity markets and private investment marketplace that could lead to investment losses and fluctuations in interest rates;

· ratings downgrades could affect investment values and therefore statutory surplus;

· the adequacy of our loss reserves and loss expense reserves;

· the frequency and severity of natural and man-made catastrophic events, including, but not limited to, hurricanes, tornadoes, windstorms, earthquakes, hail, terrorism, explosions, severe winter weather, floods and fires;

· adverse market, governmental, regulatory, legal or judicial conditions or actions;

· the concentration of our business in the Eastern Region;

· the cost and availability of reinsurance;

· our ability to collect on reinsurance and the solvency of our reinsurers;

· uncertainties related to insurance premium rate increases and business retention;

· changes in insurance regulations that impact our ability to write and/or cease writing insurance policies in one or more states, particularly changes in New Jersey automobile insurance laws and regulations;

· recent federal financial regulatory reform provisions that could pose certain risks to our operations;

· our ability to maintain favorable ratings from rating agencies, including A.M. Best, Standard & Poor’s, Moody’s and Fitch;

· our entry into new markets and businesses; and

· other risks and uncertainties we identify in filings with the United States Securities and Exchange Commission, including, but not limited to, our Annual Report on Form 10-K and other periodic reports.

These risk factors may not be exhaustive.  We operate in a continually changing business environment, and new risk factors emerge from time-to-time.  We can neither predict such new risk factors nor can we assess the impact, if any, of such new risk factors on our businesses or the extent to which any factor or combination of factors may cause actual results to differ materially from those expressed or implied in any forward-looking statements in this report.  In light of these risks, uncertainties and assumptions, the forward-looking events discussed in this report might not occur.

Selective’s SEC filings can be accessed through the Investors and Corporate Governance sections of Selective’s website, www.selective.com, or through the SEC’s EDGAR Database at www.sec.gov (Selective EDGAR CIK No. 0000230557).

-more-

1 Operating income differs from net income by the exclusion of realized gains or losses on investments.  It is used as an important financial measure by management, analysts and investors, because the realization of investment gains and losses on sales in any given period is largely discretionary as to timing.  In addition, these investment gains and losses, as well as other-than-temporary investment impairments that are charged to earnings, could distort the analysis of trends.  Operating income is not intended as a substitute for net income prepared in accordance with accounting principles generally accepted in the United States of America (GAAP).  A reconciliation of operating income to net income is provided in the GAAP Highlights and Reconciliation of Non-GAAP Measures to Comparable GAAP Measures.  Statutory data is prepared in accordance with statutory accounting rules as defined by the National Association of Insurance Commissioners Accounting Practices and Procedures Manual and, therefore, is not reconciled to GAAP.

-more-

Selective Insurance Group, Inc. (Nasdaq: SIGI) *

GAAP Highlights and Reconciliation of Non-GAAP Measures to Comparable

GAAP Measures

(in thousands, except per share data)
3 months ended June 30:	2009			2008
Net premiums written	$	365,263			389,394
Net premiums earned		358,311			377,254
Net investment income earned		26,368			38,515
Net realized (losses) gains		(11,294	)		1,923
Total revenues		388,249			433,353
Operating income		23,030			27,401
Net realized (losses) gains, net of tax		(7,342	)		1,250
Net income	$	15,688			28,651
Statutory combined ratio		98.8	%		98.7	%
GAAP combined ratio		98.3	%		99.8	%
Operating income per diluted share	$	0.43			0.52
Net income per diluted share		0.29			0.54
Weighted average diluted shares		53,234			53,064
Book value per share	$	17.85			19.32

6 months ended June 30:	2009			2008
Net premiums written	$	741,046			781,348
Net premiums earned		722,184			760,641
Net investment income earned		42,085			76,381
Net realized (losses) gains		(35,319	)		3,438
Total revenues		757,814			872,400
Operating income		25,769			46,919
Net realized (losses) gains, net of tax		(22,958	)		2,235
Net income	$	2,811			49,154
Statutory combined ratio		99.5	%		98.5	%
GAAP combined ratio		99.6	%		99.6	%
Operating income per diluted share	$	0.48			0.88
Net income per diluted share		0.05			0.92
Weighted average diluted shares		53,181			53,461
Book value per share	$	17.85			19.32

*All amounts included in this release exclude inter-company transactions.

###

EX-99.2

Supplemental Investor Package

Second Quarter 2009

Investor Contact:

Jennifer DiBerardino

Vice President, Investor Relations

Tel:  973-948-1364

jennifer.diberardino@selective.com

SELECTIVE INSURANCE GROUP, INC.

SECOND QUARTER 2009 INVESTOR PACKET

TABLE OF CONTENTS

Earnings Press Release		1
Selected Balance Sheet Data		7
Selected Income Statement Data		8
Quarterly Investment Income		9
Statutory Combined Ratio Summary by LOB Quarter		10
Statutory Combined Ratio Summary by LOB YTD June		11
Consolidated Balance Sheets		12
Consolidated Statements of Income		13
Consolidated Statements of Stockholder’s Equity		14
Consolidated Statements of Cash Flow		15
Statutory Balance Sheets		16
Statutory Statements of Income		17
Investment Portfolio – Appendix
	Alternative Investments Exhibit	18
	Municipal Bond Portfolio Chart	19
	Municipal Bond Portfolio Exhibit	20
	Municipal Bond Portfolio State & Repayment Source	21
	Municipal Fixed Income Portfolio Exhibit	22
	Ratings on Municipal Fixed Income Portfolio Exhibit	23
	Structured Securities Chart	24
	Structured Securities Ratings Migration	25
	RMBS & RABS Chart	26
	RMBS & RABS Ratings Migrations.	27
	RMBS & RABS by Vintage Year Exhibit	28
	RMBS and RABS by Type Exhibit	29
	Alt-A RMBS Chart	30
	Alt-A by Vintage Year Exhibit	31
	CMBS Chart	32
	CMBS Ratings Migration	33
	CMBS by Vintage Year Exhibit	34
	CMBS by Type Exhibit	35
	2007 Vintage CMBS Chart	36
	2007 Vintage CMBS Exhibit	37
	2005 & 2006 Vintage CMBS Chart	38
	2005 & 2006 Vintage CMBS Exhibit	39
	Fixed Maturities Severity & Duration of Unrealized/Unrecognized Losses Exhibit	40
	Credit Quality of AFS Securities Exhibit	41
	Credit Quality of HTM Securities Exhibit	42

Selective Insurance Group, Inc.

Selected Balance Sheet Data (unaudited)

($ in thousands, except per share amounts)

	June 30,								June 30,								December 31,
	2009								2008								2008
						Unrealized/								Unrecognized/								Unrecognized/
	Balance			Market		Unrecognized			Balance			Market		Unrealized			Balance			Market		Unrealized
	Sheet			Value		Gain/(Loss)			Sheet			Value		Gain/(Loss)			Sheet			Value		Gain/(Loss)
Invested Assets:
Corporate bonds1,2	$	1,076,043			1,073,982		(65,100	)	$	1,189,884			1,189,885		(43,847	)	$	1,024,179			1,024,181		(124,294	)
Gov't\ Municipal bonds2		2,120,497			2,104,282		48,216			1,858,473			1,858,564		6,486			2,011,262			2,011,275		35,240
Total bonds		3,196,540			3,178,264		(16,884	)		3,048,357			3,048,449		(37,361	)		3,035,441			3,035,456		(89,054	)
Equities		81,687			81,687		3,345			212,838			212,838		69,754			132,131			132,131		6,184
Short-term investments		195,033			195,033		-			218,074			218,074		-			198,111			198,111		-
Trading securities		-			-		-			23,196			23,196		5,214			2,569			2,569		(1,216	)
Other investments		145,727			145,727		(22,103	)		206,410			206,410		26,258			172,057			172,057		(5,585	)
Total invested assets		3,618,987			3,600,711		(35,642	)		3,708,875			3,708,967		63,865			3,540,309			3,540,324		(89,671	)
Invested assets per $ of stockholders' equity		3.82								3.64								3.98
Total assets		5,030,875								5,079,175								4,941,332
Liabilities:
Reserve for losses		2,282,893								2,262,310								2,256,329
Reserve for loss expenses		394,987								375,451								384,644
Unearned premium reserve		867,977								868,851								844,334
Total liabilities		4,084,500								4,061,463								4,050,839
Stockholders' equity		946,375								1,017,712								890,493
Total debt to capitalization ratio		21.7	%							21.2	%							23.5	%
Adjusted total debt to capitalization ratio 3		15.4	%							15.3	%							17.0	%
Book value per share		17.85								19.32								16.84
Book value per share excluding unrealized gain or loss on bond portfolio		17.82								19.78								17.94
NPW per insurance segment employee		767								802								797
Statutory premiums to surplus ratio		1.7	x							1.5	x							1.7	x
Statutory surplus		873,365								999,676								884,431

1 Includes mortgage-backed and asset backed securities.

2 Certain prior year amounts were reclassified to conform with currrent year presentation.

3 The adjusted debt to capitalization ratio reflects a reduction in debt for amounts held in an irrevocable trust for the benefit of senior note holders as well as the median rating agency equity treatment of 75% applied to our $100 million Junior Subordinated Notes issued September 25, 2006.

Selective Insurance Group, Inc.
Selected Income Statement Data (unaudited)
June 2009		THREE MONTHS ENDED JUNE 30,												SIX MONTHS ENDED JUNE 30,
($ in thousands, except per share amounts)		2009						2008						2009						2008
					Per diluted share						Per diluted share						Per diluted share						Per diluted share
Consolidated
Revenue		$	388,249					$	433,353						757,814					$	872,400
Operating income			23,030			0.43			27,401			0.52			25,769			0.48			46,919			0.88
Net realized (losses) gains, after tax			(7,342	)		(0.14	)		1,250			0.02			(22,958	)		(0.43	)		2,235			0.04
Net income			15,688			0.29			28,651			0.54			2,811			0.05			49,154			0.92
Operating return on equity			9.9	%					10.6	%					5.6	%					9.0	%
Insurance Operations
Gross premiums written			429,769						447,798						866,211						891,777
Net premiums written			365,263						389,394						741,046						781,348
Net premiums earned			358,311						377,254						722,184						760,641
Underwriting profit	- before tax		6,032						934						3,069						2,733
	- after tax		3,921			0.07			607			0.01			1,995			0.04			1,776			0.03
GAAP combined ratio			98.3	%					99.8	%					99.6	%					99.6	%
Commercial lines
Net premiums earned			305,245						325,197						616,790						657,288
GAAP combined ratio			97.3	%					99.7	%					98.7	%					99.0	%
Personal lines
Net premiums earned			53,066						52,057						105,394						103,353
GAAP combined ratio			104.1	%					100.4	%					104.7	%					103.8	%
Investments
Net investment income	- before tax		26,368						38,515						42,085						76,381
	- after tax		21,869			0.41			30,082			0.57			37,010			0.70			59,453			1.11
Effective tax rate			17.1	%					21.9	%					12.1	%					22.2	%
Annual after-tax yield on investment portfolio															2.1	%					3.2	%
Annual after-tax, after-interest expense yield															1.7	%					2.8	%
Invested assets per $ of stockholders' equity															3.82						3.64
Human Resource Administration Outsourcing
Revenue			11,054						13,498						23,773						28,616
Income - after tax			330			0.01			607			0.01			403			0.01			1,114			0.02
Return on revenue			3.0	%					4.5	%					1.7	%					3.9	%
Worksite lives															20,868						24,660
Other expenses (net of other income)
Interest expense	- before tax		(4,843	)					(5,127	)					(9,867	)					(10,436	)
	- after tax		(3,147	)		(0.06	)		(3,332	)		(0.06	)		(6,413	)		(0.12	)		(6,783	)		(0.13	)
Other - after tax		$	57			-		$	(563	)		(0.01	)		(7,226	)		(0.15	)	$	(8,641	)		(0.15	)
Diluted weighted avg shares outstanding			53,234						53,064						53,181						53,461

Selective Insurance Group, Inc. and Consolidated Subsidiaries

Quarterly

GAAP Investment Income

(unaudited)

($ in thousands)

	For the three months ended						%			Year to Date						%
	June			June			Increase			June			June			Increase
	2009			2008			(Decrease)			2009			2008			(Decrease)
Investment Income:
Interest:
Fixed Maturity Securities	$	35,972			36,424			(1.2	)	$	72,233			72,830			(0.8	)
Short-term		312			1,290			(75.8	)		924			2,727			(66.1	)
Alternative Investments		(8,855	)		344			N/M			(29,404	)		2,177			N/M
Dividends		496			1,520			(67.4	)		1,011			2,679			(62.3	)
Change in Fair Value		-			257			(100.0	)		262			(1,631	)		N/M
Miscellaneous		68			49			38.8			240			123			95.1
		27,993			39,884			(29.8	)		45,266			78,905			(42.6	)
Investment Expense		1,625			1,369			18.7			3,181			2,524			26.0
Net Investment Income Before Tax		26,368			38,515			(31.5	)		42,085			76,381			(44.9	)
Tax		4,499			8,433			(46.7	)		5,075			16,928			(70.0	)
Net Investment Income After Tax	$	21,869			30,082			(27.3	)	$	37,010			59,453			(37.7	)
Net Investment Income per Share		0.41			0.57			(28.1	)		0.70			1.11			(36.9	)
Effective Tax Rate		17.1	%		21.9	%					12.1	%		22.2	%
Average Yields:
Fixed Maturity Securities
Pre Tax											4.3	%		4.6	%
After Tax											3.4	%		3.6	%
Portfolio
Pre Tax											2.4	%		4.1	%
After Tax											2.1	%		3.2	%

	For the three months ended						Year to Date
	June			June			June			June
Net Realized Gains (Losses)	2009			2008			2009			2008
Fixed Maturities		(9,811	)		(12,619	)		(33,646	)		(13,230	)
Equity Securities		(294	)		14,542			(484	)		16,668
Other		(1,189	)		-			(1,189	)		-
Total		(11,294	)		1,923			(35,319	)		3,438
Net of Tax		(7,342	)		1,250			(22,958	)		2,235

Selective Insurance Group, Inc.

2009 Statutory Results by Line of Business

2nd Qtr 2009 (unaudited)

($ in thousands)

	Net					Net											Underwriting			Dividends to
	Premiums		Percent			Premiums		Percent			Loss			LAE			Expense			Policyholders			Combined Ratio			Combined Ratio			Underwriting
	Written		Change			Earned		Change			Ratio			Ratio			Ratio			Ratio			2009			2008			Gain/(Loss)
Personal Lines:
Homeowners	$	20,880		12.9	%	$	17,618		3.8	%		51.4	%		9.7	%		33.4	%		0.0	%		94.5	%		91.1	%	$	(118	)
Auto		34,995		(1.0	)%		33,034		0.3	%		68.9	%		14.7	%		29.9	%		0.0	%		113.5	%		110.1	%		(5,061	)
Other (including flood)		2,758		17.5	%		2,413		12.7	%		52.7	%		(17.0	)%		(34.2	)%		0.0	%		1.5	%		(30.7	)%		2,494
Total	$	58,633		4.3	%	$	53,066		1.9	%		62.4	%		11.6	%		28.1	%		0.0	%		102.1	%		98.1	%	$	(2,685	)
Commercial Lines:
Fire/IM	$	50,217		2.5	%	$	48,970		0.8	%		35.7	%		5.3	%		37.5	%		0.1	%		78.6	%		94.4	%	$	10,023
Workers compensation		64,696		(17.8	)%		66,590		(14.1	)%		57.8	%		14.2	%		27.9	%		1.0	%		100.9	%		98.6	%		(87	)
General liability		92,429		(12.0	)%		91,853		(8.1	)%		51.1	%		18.7	%		33.8	%		0.1	%		103.7	%		103.3	%		(3,623	)
Auto		76,187		(2.9	)%		75,339		(3.1	)%		60.5	%		9.3	%		29.2	%		0.0	%		99.0	%		96.2	%		513
BOP		15,776		8.8	%		15,550		8.1	%		73.6	%		12.2	%		34.1	%		0.0	%		119.9	%		113.5	%		(3,179	)
Bonds		4,853		(2.7	)%		4,560		(3.3	)%		32.2	%		4.5	%		60.3	%		0.0	%		97.0	%		77.8	%		(38	)
Other		2,472		0.8	%		2,383		2.3	%		4.7	%		0.7	%		42.8	%		0.0	%		48.2	%		43.8	%		1,197
Total	$	306,630		(8.0	)%	$	305,245		(6.1	)%		52.9	%		12.6	%		32.5	%		0.3	%		98.3	%		98.8	%	$	4,806
Grand Total	$	365,263		(6.2	)%	$	358,311		(5.0	)%		54.3	%		12.4	%		31.9	%		0.2	%		98.8	%		98.7	%	$	2,121

Note: Some amounts may not foot due to rounding.

	2009		2008
Losses Paid	$	198,478	$	184,579
LAE Paid		40,822		36,010
Total Paid	$	239,300	$	220,589

Selective Insurance Group, Inc.

2009 Statutory Results by Line of Business

June 2009 YTD (unaudited)

($ in thousands)

	Net					Net											Underwriting			Dividends to
	Premiums		Percent			Premiums		Percent			Loss			LAE			Expense			Policyholders			Combined Ratio			Combined Ratio			Underwriting
	Written		Change			Earned		Change			Ratio			Ratio			Ratio			Ratio			2009			2008			Gain/(Loss)
Personal Lines:
Homeowners	$	36,231		11.1	%	$	34,724		3.5	%		67.5	%		9.2	%		35.1	%		0.0	%		111.8	%		100.9	%	$	(4,626	)
Auto		67,634		(1.9	)%		65,886		0.5	%		62.6	%		14.3	%		30.2	%		0.0	%		107.1	%		111.7	%	$	(5,195	)
Other (including flood)		5,110		15.7	%		4,784		12.3	%		64.1	%		(14.0	)%		(32.9	)%		0.0	%		17.2	%		(14.9	)%		4,067
Total	$	108,975		2.9	%	$	105,394		2.0	%		64.3	%		11.3	%		28.9	%		0.0	%		104.5	%		102.8	%	$	(5,754	)
Commercial Lines:
Fire/IM	$	100,451		3.3	%	$	97,855		(0.7	)%		47.6	%		5.0	%		37.5	%		(0.3	)%		89.8	%		95.5	%	$	9,027
Workers compensation		136,872		(13.9	)%		136,967		(12.2	)%		54.6	%		14.4	%		26.2	%		1.4	%		96.6	%		96.5	%		4,750
General liability		192,233		(11.1	)%		186,077		(8.4	)%		52.6	%		18.5	%		33.0	%		(0.1	)%		104.0	%		100.2	%		(9,550	)
Auto		156,046		(1.7	)%		151,185		(3.7	)%		60.6	%		8.2	%		29.0	%		(0.2	)%		97.6	%		98.2	%		2,286
BOP		32,153		8.3	%		30,761		7.8	%		72.7	%		12.2	%		34.0	%		0.0	%		118.9	%		109.4	%		(6,278	)
Bonds		9,192		(3.4	)%		9,183		(3.3	)%		27.6	%		4.7	%		59.9	%		0.0	%		92.2	%		79.4	%		711
Other		5,124		4.4	%		4,763		3.4	%		1.3	%		0.8	%		42.9	%		0.0	%		45.0	%		45.8	%		2,465
Total	$	632,071		(6.4	)%	$	616,790		(6.2	)%		54.4	%		12.3	%		31.8	%		0.2	%		98.7	%		97.8	%	$	3,412
Grand Total	$	741,046		(5.2	)%	$	722,184		(5.1	)%		55.9	%		12.1	%		31.3	%		0.2	%		99.5	%		98.5	%	$	(2,342	)

Note: Some amounts may not foot due to rounding.

	2009		2008
Losses Paid	$	394,270	$	373,419
LAE Paid		77,507		70,471
Total Paid	$	471,777	$	443,890

SELECTIVE INSURANCE GROUP, INC.	Unaudited
CONSOLIDATED BALANCE SHEETS	June 30,			December 31,
($ in thousands, except share amounts)	2009			2008
ASSETS
Investments:
Fixed maturity securities, held-to-maturity – at carry value
(fair value of:  $1,862,148 – 2009; $1,178 – 2008)	$	1,880,424			1,163
Fixed maturity securities, available-for-sale – at fair value
(amortized cost of:  $1,319,332 – 2009; $3,123,346 – 2008)		1,316,116			3,034,278
Equity securities, available-for-sale – at fair value
(cost of:  $78,342 – 2009;  $125,947 – 2008)		81,687			132,131
Short-term investments – at cost which approximates fair value		195,033			198,111
Equity securities, trading – at fair value		-			2,569
Other investments		145,727			172,057
Total investments		3,618,987			3,540,309
Cash and cash equivalents		12,106			18,643
Interest and dividends due or accrued		35,113			36,538
Premiums receivable, net of allowance for uncollectible
accounts of:  $5,899 – 2009; $4,237 – 2008		498,591			480,894
Other trade receivables, net of allowance for uncollectible
accounts of:  $227 – 2009; $299 – 2008		20,957			19,461
Reinsurance recoverable on paid losses and loss expenses		5,125			6,513
Reinsurance recoverable on unpaid losses and loss expenses		241,276			224,192
Prepaid reinsurance premiums		101,398			96,617
Current federal income tax		10,688			26,327
Deferred federal income tax		129,123			146,801
Property and equipment – at cost, net of accumulated
depreciation and amortization of:  $138,443 – 2009; $132,609 – 2008		48,053			51,697
Deferred policy acquisition costs		218,016			212,319
Goodwill		29,637			29,637
Other assets		61,805			51,384
Total assets	$	5,030,875			4,941,332
LIABILITIES AND STOCKHOLDERS’ EQUITY
Liabilities:
Reserve for losses	$	2,282,893			2,256,329
Reserve for loss expenses		394,987			384,644
Unearned premiums		867,977			844,334
Notes payable		261,592			273,878
Commissions payable		40,438			48,560
Accrued salaries and benefits		126,264			147,050
Other liabilities		110,349			96,044
Total liabilities		4,084,500			4,050,839
Stockholders' Equity:
Preferred stock of $0 par value per share:
Authorized shares:  5,000,000; no shares issued or outstanding
Common stock of $2 par value per share:
Authorized shares:  360,000,000
Issued: 95,568,225 – 2009; 95,263,508 – 2008		191,136			190,527
Additional paid-in capital		225,393			217,195
Retained earnings		1,119,416			1,128,149
Accumulated other comprehensive loss		(42,187	)		(100,666	)
Treasury stock – at cost (shares:  42,557,461 – 2009;  42,386,921 – 2008)		(547,383	)		(544,712	)
Total stockholders' equity		946,375			890,493
Commitments and contingencies
Total liabilities and stockholders' equity	$	5,030,875			4,941,332

SELECTIVE INSURANCE GROUP, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME	Quarter ended						Six Months ended
	June 30,						June 30,
(in thousands, except per share amounts)	2009			2008			2009			2008
Revenues:
Net premiums written	$	365,263			389,394			741,046			781,348
Net increase in unearned premiums and prepaid reinsurance premiums		(6,952	)		(12,140	)		(18,862	)		(20,707	)
Net premiums earned		358,311			377,254			722,184			760,641
Net investment income earned		26,368			38,515			42,085			76,381
Net realized (losses) gains
Other-than-temporary impairments		(12,534	)		(9,784	)		(39,634	)		(9,784	)
Other-than-temporary impairments on fixed maturity securities transferred to other comprehensive income		59			-			59			-
Other net realized investment gains		1,181			11,707			4,256			13,222
Total net realized investment (losses) gains		(11,294	)		1,923			(35,319	)		3,438
Other income		14,864			15,661			28,864			31,940
Total revenues		388,249			433,353			757,814			872,400
Expenses:
Losses incurred		194,577			209,915			403,666			420,045
Loss expenses incurred		44,472			42,889			87,577			85,835
Policy acquisition costs		114,522			122,966			227,628			250,643
Dividends to policyholders		812			1,579			1,277			2,114
Interest expense		4,843			5,127			9,867			10,436
Other expenses		16,392			14,792			36,090			40,640
Total expenses		375,618			397,268			766,105			809,713
Income (loss) before federal income tax		12,631			36,085			(8,291	)		62,687
Federal income tax expense (benefit):
Current		(1,703	)		12,883			3,991			24,018
Deferred		(1,354	)		(5,449	)		(15,093	)		(10,485	)
Total federal income tax (benefit) expense		(3,057	)		7,434			(11,102	)		13,533
Net income	$	15,688			28,651			2,811			49,154
Earnings per share:
Basic net income	$	0.30			0.55			0.05			0.94
Diluted net income	$	0.29			0.54			0.05			0.92
Dividends to stockholders	$	0.13			0.13			0.26			0.26

SELECTIVE INSURANCE GROUP, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF
STOCKHOLDERS’ EQUITY
	Six Months Ended June 30,
($ in thousands, except per share amounts)	2009				2008
Common stock:
Beginning of year	$	190,527				189,306
Dividend reinvestment plan
(shares:  70,839 – 2009; 40,645 – 2008)		141				81
Convertible debentures
(shares:  45,759 – 2008)		-				92
Stock purchase and compensation plans
(shares:  233,878 – 2009; 247,357 – 2008)		468				494
End of period		191,136				189,973
Additional paid-in capital:
Beginning of year		217,195				192,627
Dividend reinvestment plan		751				847
Convertible debentures		-				645
Stock purchase and compensation plans		7,447				13,948
End of period		225,393				208,067
Retained earnings:
Beginning of year		1,128,149				1,105,946
Cumulative-effect adjustment due to adoption of FAS 159,
net of deferred income tax effect of $3,344		-				6,210
Cumulative-effect adjustment due to adoption, on April 1, 2009, of FSP FAS 115-2 and FAS 124-2, net of deferred income tax effect of $1,282		2,380				-
Net income		2,811		2,811		49,154		49,154
Cash dividends to stockholders ($0.26 per share – 2009;
$0.26 per share – 2008)		(13,924	)			(14,023	)
End of period		1,119,416				1,147,287
Accumulated other comprehensive (loss) income:
Beginning of year		(100,666	)			86,043
Cumulative-effect adjustment due to adoption of FAS 159,
net of deferred income tax effect of $(3,344)		-				(6,210	)
Cumulative-effect adjustment due to adoption, on April 1, 2009, of FSP FAS 115-2 and  FAS 124-2, net of deferred income tax effect of $(1,282)		(2,380	)			-
Other comprehensive income (loss), increase (decrease) in:
Unrealized (losses) gains on investment securities:
Non-credit portion of other-than-temporary impairment losses recognized in other comprehensive income, net of deferred income tax effect of $(9)		(18	)			-
Other net unrealized gains (losses) on investment securities, net of deferred income tax effect of:  $32,472 – 2009; $(34,803) – 2008		60,306				(64,633	)
Total unrealized gains (losses) on investment securities		60,288		60,288		(64,633	)	(64,633	)
Defined benefit pension plans, net of deferred income tax effect of:  $308 – 2009; $38 – 2008		571		571		70		70
End of period		(42,187	)			15,270
Comprehensive income (loss)				63,670				(15,409	)
Treasury stock:
Beginning of year		(544,712	)			(497,879	)
Acquisition of treasury stock
(shares:  170,540 – 2009; 1,958,984 – 2008)		(2,671	)			(45,006	)
End of period		(547,383	)			(542,885	)
Total stockholders’ equity	$	946,375				1,017,712

SELECTIVE INSURANCE GROUP, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOW	Six-Months Ended June 30,
($ in thousands)	2009			2008
Operating Activities
Net income	$	2,811			49,154
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		13,910			14,197
Stock-based compensation expense		5,599			9,137
Undistributed losses of equity method investments		29,404			1,047
Net realized (losses) gains		35,319			(3,438	)
Postretirement life curtailment benefit		(4,217	)		-
Deferred tax		(15,093	)		(10,485	)
Unrealized loss on trading securities		(262	)		1,631
Changes in assets and liabilities:
Increase in reserves for losses and loss expenses, net of reinsurance recoverable on unpaid losses and loss expenses		20,354			75,033
Increase in unearned premiums, net of prepaid reinsurance and advance premiums		18,894			20,350
Decrease in net federal income tax recoverable		15,639			3,095
Increase in premiums receivable		(17,697	)		(28,317	)
Increase in other trade receivables		(1,496	)		(1,727	)
(Increase) decrease in deferred policy acquisition costs		(5,697	)		789
Decrease in interest and dividends due or accrued		1,086			1,212
Decrease in reinsurance recoverable on paid losses and loss expenses		1,388			1,700
Decrease in accrued salaries and benefits		(14,573	)		(4,301	)
Decrease in accrued insurance expenses		(7,703	)		(20,756	)
Purchase of trading securities		-			(5,813	)
Sale of trading securities		2,831			6,100
Other-net		(6,506	)		7,479
Net adjustments		71,180			66,933
Net cash provided by operating activities		73,991			116,087
Investing Activities
Purchase of fixed maturity securities, held-to-maturity		(157,752	)		-
Purchase of fixed maturity securities, available-for-sale		(512,726	)		(239,887	)
Purchase of equity securities, available-for-sale		(75,609	)		(16,095	)
Purchase of other investments		(10,595	)		(25,976	)
Purchase of short-term investments		(1,160,667	)		(1,061,242	)
Sale of fixed maturity securities, held-to-maturity		5,622			-
Sale of fixed maturity securities, available-for-sale		371,667			80,056
Sale of short-term investments		1,163,746			1,033,334
Redemption and maturities of fixed maturity securities, held-to-maturity		123,213			1,818
Redemption and maturities of fixed maturity securities, available-for-sale		63,897			158,685
Sale of equity securities, available-for-sale		123,269			34,585
Proceeds from other investments		15,498			3,798
Purchase of property and equipment		(2,986	)		(3,851	)
Net cash used in investing activities		(53,423	)		(34,775	)
Financing Activities
Dividends to stockholders		(13,378	)		(13,009	)
Acquisition of treasury stock		(2,671	)		(45,006	)
Principal payment of notes payable		(12,300	)		(12,300	)
Net proceeds from stock purchase and compensation plans		2,402			4,457
Excess tax benefits from share-based payment arrangements		(1,158	)		1,319
Principal payments of convertible bonds		-			(8,754	)
Net cash used in financing activities		(27,105	)		(73,293	)
Net (decrease) increase in cash and cash equivalents		(6,537	)		8,019
Cash and cash equivalents, beginning of year		18,643			8,383
Cash and cash equivalents, end of period	$	12,106			16,402

Selective Insurance Group, Inc.

Combined Insurance Company Subsidiaries

Unaudited Statutory Balance Sheets

($ in thousands)

	Jun-30			Jun-30			Dec-31
	2009			2008			2008*
ASSETS
Bonds	$	3,156,050			3,083,417			3,104,395
Common stocks		81,687			258,064			134,700
Affiliated mortgage loan		39,708			-			40,000
Other investments		156,033			206,560			172,346
Short-term investments		167,906			181,852			137,878
Total investments		3,601,384			3,729,893			3,589,319
Cash on hand and in banks		(29,290	)		(45,075	)		(36,472	)
Interest and dividends due and accrued		35,263			34,986			36,523
Premiums receivable		495,320			521,029			476,768
Reinsurance recoverable on paid losses and expenses		5,125			(7,601	)		6,513
Federal income tax recoverable		-			-			12,069
Deferred tax recoverable		89,673			88,227			86,208
EDP equipment		2,748			4,042			3,815
Equities and deposits in pools and associations		7,287			11,661			8,517
Receivable for sold securities		26,378			848			13,278
Other assets		24,585			30,359			28,719
Total assets	$	4,258,473			4,368,369			4,225,257
LIABILITIES
Reserve for losses	$	2,041,117			2,000,592			2,031,947
Reinsurance payable on paid loss and loss expense		627			1,353			716
Reserve for loss expenses		392,937			373,173			382,796
Unearned premiums		766,579			779,873			747,717
Reserve for commissions payable		40,438			44,987			48,560
Ceded balances payable		10,003			5,992			8,421
Federal income tax payable		1,778			24,432			-
Premium and other taxes payable		21,139			19,417			20,721
Reserve for dividends to policyholders		4,073			5,112			5,023
Reserves for unauthorized reinsurance		1,416			1,258			1,416
Payable for securities		22,723			50,951			-
Funds withheld on account of others		4,649			4,854			4,977
Accrued salaries and benefits		64,952			42,943			74,287
Other liabilities		12,677			13,756			14,245
Total liabilities		3,385,108			3,368,693			3,340,826
POLICYHOLDERS' SURPLUS
Capital		28,325			28,325			28,325
Paid in surplus		255,792			235,792			235,792
Unassigned surplus		589,248			735,559			620,314
Total policyholders' surplus		873,365			999,676			884,431
Total liabilities and policyholders' surplus	$	4,258,473			4,368,369			4,225,257

*December 31, 2008 results include a retroactive affiliate transaction involving SICA, SIGI, and Wantage Avenue Holding Company.

Selective Insurance Group, Inc.

Combined Insurance Company Subsidiaries

Unaudited Statutory Statements Of Income

($ in thousands)

	Three Months Ended										Six Months Ended
	June										June
	2009					2008					2009					2008
UNDERWRITING
Net premiums written	$	365,263					389,395					741,046					781,348
Net premiums earned		358,311					377,254					722,184					760,641
Net losses paid		198,478					184,579					394,270					373,419
Change in reserve for losses		(3,891	)				25,348					9,171					46,632
Net losses incurred		194,587		54.3	%		209,927		55.6	%		403,441		55.9	%		420,051		55.2	%
Net loss expenses paid		40,822					36,010					77,507					70,471
Change in reserve for loss expenses		3,691					6,768					10,142					15,047
Net loss expenses incurred		44,513		12.4	%		42,778		11.3	%		87,649		12.1	%		85,518		11.2	%
Net underwriting expenses incurred		119,042		32.7	%		122,768		31.6	%		234,855		31.7	%		249,254		31.9	%
Total deductions		358,142					375,473					725,945					754,823
Statutory gain (loss)		169					1,781					(3,761	)				5,818
Net loss from premium balances charged off		(1,034	)				(833	)				(2,368	)				(1,486	)
Finance charges and other income		3,798					1,775					5,064					2,466
Total other income		2,764		-0.8	%		942		-0.2	%		2,696		-0.4	%		980		-0.1	%
Policyholders' dividends incurred		(812	)	0.2	%		(1,579	)	0.4	%		(1,277	)	0.2	%		(2,114	)	0.3	%
Total underwriting gain (loss)		2,121		98.8	%		1,144		98.7	%		(2,342	)	99.5	%		4,684		98.5	%
INVESTMENT
Net investment income earned		34,445					37,992					60,499					78,240
Net realized (loss) gain		(11,536	)				2,827					(36,514	)				6,147
Total income before income tax		25,030					41,963					21,643					89,071
Federal income tax expense		4,509					15,254					14,093					29,948
Net income	$	20,521					26,709					7,550					59,123
Policyholders' Surplus
Surplus, beginning of period	$	849,985					1,016,282					884,431					1,034,294
Net income		20,521					26,709					7,550					59,123
Change in deferred tax		505					5,842					15,557					7,253
Change in unrealized gains (losses)		366					(10,887	)				(21,695	)				(29,002	)
Dividends to stockholders		-					(28,003	)				(12,003	)				(52,543	)
Paid in surplus		-					-					20,000					-
Change in non-admitted assets		1,929					(10,253	)				(20,534	)				(19,340	)
Surplus adjustments		59					(14	)				59					(109	)
Net change in surplus for period		23,380					(16,606	)				(11,066	)				(34,618	)
Surplus, end of period	$	873,365					999,676					873,365					999,676
Statutory underwriting gain (loss):	$	2,121					1,144					(2,342	)				4,684
Adjustments under GAAP:
Deferred policy acquisition costs		4,347					87					5,698					(789	)
Other, net		(436	)				(297	)				(287	)				(1,162	)
GAAP underwriting gain	$	6,032					934					3,069					2,733

Note:  Some amounts or ratios may not foot due to rounding.

Certain amounts have been reclassified to conform to the current year's presentation.

Selective Insurance Group, Inc. and Consolidated Subsidiaries

Alternative Investments

as of June 30, 2009

(unaudited)

	Inception	Current				Invest.		2nd QTR			YTD			Remaining
Fund	Year	Market Value		Cost		Multiple(1)		Income			Income			Commitment
Real Estate
LEH RE II	2005	$	11,186,476	$	12,011,057		0.96	$	(1,385,110	)	$	(4,266,161	)	$	4,160,592
GS Whitehall 2007	2007	$	4,886,634	$	14,250,000		0.34	$	(1,019,607	)	$	(3,660,787	)	$	750,000
LEH RE III	2008	$	3,637,811	$	6,151,347		0.59	$	(460,207	)	$	(1,479,365	)	$	8,848,653
Total - Real Estate		$	19,710,921	$	32,412,404			$	(2,864,924	)	$	(9,406,313	)	$	13,759,245
Mezzanine Financing
GS Mezz III	2003	$	3,843,903	$	2,403,021		1.14	$	(180,988	)	$	(504,528	)	$	5,637,326
LEH Euro Mezz	2004	$	3,311,310	$	2,377,268		1.07	$	(285,732	)	$	(900,732	)	$	-
GS Mezz 2006	2006	$	3,799,339	$	9,224,574		0.51	$	(1,757,727	)	$	(3,419,838	)	$	5,228,783
GS Mezz V	2007	$	6,118,080	$	7,094,103		0.89	$	(47,247	)	$	(611,973	)	$	17,752,669
Total - Mezz. Financing		$	17,072,632	$	21,098,966			$	(2,271,694	)	$	(5,437,071	)	$	28,618,778
Distressed Debt
Varde LP	1997	$	11,194,469	$	4,000,000		2.80	$	151,681		$	(390,032	)	$	-
Varde VIII	2006	$	10,931,514	$	10,000,000		1.09	$	632,545		$	567,555		$	-
GS Distressed Opp III	2007	$	5,940,645	$	10,000,056		0.61	$	(1,048,251	)	$	(2,480,223	)	$	4,610,862
Total - Distressed Debt		$	28,066,628	$	24,000,056			$	(264,026	)	$	(2,302,700	)	$	4,610,862
Private Equity
Prospector (1)	1997	$	1,777,739	$	1,778,000		2.89	$	156		$	(230	)	$	-
Trilantic Capital Partners III	2004	$	7,330,848	$	4,014,247		1.37	$	257,127		$	(387,873	)	$	1,195,415
NB Co-Invest	2006	$	6,501,920	$	7,869,378		0.88	$	(957,261	)	$	(2,560,229	)	$	4,769,210
GS PEP Asia	2007	$	1,019,137	$	1,354,400		0.75	$	(102,414	)	$	(147,236	)	$	5,645,157
Trilantic Capital Partners IV	2007	$	3,361,621	$	3,987,076		0.84	$	17,508		$	(222,492	)	$	7,111,275
Total - Private Equity		$	19,991,265	$	19,003,101			$	(784,884	)	$	(3,318,060	)	$	18,721,058
Private Equity, Secondary Market
NB SOF	2005	$	7,092,871	$	6,522,513		1.05	$	(482,957	)	$	(1,471,828	)	$	1,199,494
GS Vintage IV	2007	$	9,594,683	$	11,994,286		0.82	$	(1,828,149	)	$	(2,973,509	)	$	6,781,085
NB SOF II	2008	$	1,957,607	$	1,774,610		1.10	$	180,863		$	226,732		$	10,225,390
GS Vintage V	2008	$	2,025,791	$	2,200,000		0.92	$	(221,078	)	$	(184,072	)	$	7,800,000
Total - Pvt. Eq. Sec. Mkt.		$	20,670,952	$	22,491,409			$	(2,351,321	)	$	(4,402,677	)	$	26,005,969
Energy/Power Generation
ArcLight I	2002	$	684,582	$	684,582		1.69	$	(178,461	)	$	(1,896,896	)	$	1,655,505
ArcLight II	2003	$	7,397,474	$	2,570,160		1.25	$	6,500		$	(1,400,112	)	$	2,295,492
ArcLight III	2006	$	12,509,467	$	12,172,972		1.02	$	210,301		$	136,195		$	1,613,735
Quintana Energy	2006	$	5,656,706	$	6,927,238		0.82	$	(261,182	)	$	(595,321	)	$	3,072,762
ArcLight IV	2007	$	5,420,709	$	5,784,036		0.94	$	13,757		$	(64,572	)	$	4,215,964
Total - Energy/Power Generation		$	31,668,938	$	28,138,988			$	(209,085	)	$	(3,820,706	)	$	12,853,458
Venture Capital
Venture V	2001	$	5,360,223	$	6,073,978		0.91							$	2,200,000
Total - Venture Capital		$	5,360,223	$	6,073,978			$	(109,455	)	$	(716,673	)	$	2,200,000
TOTAL - ALTERNATIVE INVESTMENTS		$	142,541,558	$	153,218,902			$	(8,855,388	)	$	(29,404,200	)	$	106,769,371

(1) Market value + capital returned divided by capital called since inception

Selective Insurance Group, Inc. and Consolidated Subsidiaries

Municipal Bond Portfolio

June 30, 2009

($ in thousands)

(unaudited)

Portfolio Composition	Ratings Profile

•Market Value = $1,679,353 ; Unrealized/Unrecognized Gain/(Loss) = $40,690

•Held to Maturity (HTM) 75%; Available For Sale (AFS) 25%

•Muni Portfolio S&P Average Rating = AA+

•Muni Portfolio = 46.6% of the Total Portfolio

Selective Insurance Group Inc. and Consolidated Subsidiaries

Muni Bond Portfolio

June 30, 2009

($ in thousands)

(unaudited)

Market Value

Type	AAA			AA				A		BBB			BB			Total			% of Total Muni			% of Total Fixed Income Portfolio			% of Total GAAP Equity
General Obligation	$	271,599		$	273,067		$	11,058		$	-		$	-		$	555,724			33	%		17	%		59	%
Transportation		68,897			83,995			69,874			-			-			222,766			13	%		7	%		24	%
Water & Sewer		123,203			59,839			33,437			-			-			216,480			13	%		7	%		23	%
Education		53,382			75,967			20,247			2,499			-			152,094			9	%		5	%		16	%
Housing		46,803			98,950			-			-			-			145,753			9	%		5	%		15	%
Special Tax		52,392			48,375			30,703			-			-			131,470			8	%		4	%		14	%
Electric		41,519			37,106			38,806			-			-			117,431			7	%		4	%		12	%
Leasing		12,119			31,168			12,345			-			-			55,632			3	%		2	%		6	%
Hospital		5,586			17,377			4,095			-			-			27,057			2	%		1	%		3	%
Other		17,210			3,878			22,454			9,903			1,500			54,946			3	%		2	%		6	%
Total Muni-Market Value	$	692,711		$	729,721		$	243,019		$	12,402		$	1,500		$	1,679,353			100	%		53	%		177	%
% of Total Muni		41	%		44	%		15	%		1	%		0	%		100	%
% of Total Fixed Income Portfolio		22	%		23	%		8	%		0	%		0	%		53	%
% of Total GAAP Equity		73	%		77	%		26	%		1	%		0	%		177	%
Weighted Average Market Price		103.2			102.9			99.8			90.6			100.0			102.5

Unrealized/Unrecognized Gain/(Loss)

Type	AAA			AA				A		BBB			BB			Total
General Obligation	$	10,024		$	10,744		$	335		$	-		$	-		$	21,103
Transportation		3,327			2,170			(710	)		-			-			4,788
Water & Sewer		4,574			1,627			48			-			-			6,249
Education		1,614			2,851			202			63			-			4,729
Housing		(1,469	)		(367	)		-			-			-			(1,835	)
Special Tax		1,706			896			(146	)		-			-			2,457
Electric		1,190			1,280			359			-			-			2,829
Leasing		507			1,061			149			-			-			1,717
Hospital		247			351			17			-			-			614
Other		(153	)		188			(645	)		(1,351	)		-			(1,961	)
Total Muni-UnrealizedUnrecognized	$	21,568		$	20,800		$	(390	)	$	(1,289	)	$	-		$	40,690
% of Total Muni		53	%		51	%		-1	%		-3	%		0	%		100	%

Selective Insurance Group, Inc. and Consolidated Subsidiaries

Municipal Bond Portfolio

State and Repayment Source Composition

June 30, 2009

($ in thousands)

(unaudited)

Repayment Source Composition by State %

Market Values

State	Revenue		% of State			General Obligation (GO)-Local		% of State			General Obligation (GO)-State		% of State			Pre-refunded		% of State			TX - Permanent School Fund (PSF)		% of State			Total		% of State
TX		88,576		57	%		59,235		38	%		6,383		4	%		-		0	%		-		0	%		154,195		100	%
TX-PSF		-		0	%		-		0	%		-		0	%		-		0	%		50,363		100	%		50,363		100	%
FL		90,359		91	%		-		0	%		8,911		9	%		-		0	%		-		0	%		99,269		100	%
WA		47,416		50	%		46,987		50	%		-		0	%		-		0	%		-		0	%		94,403		100	%
AZ		75,904		82	%		16,293		18	%		-		0	%		-		0	%		-		0	%		92,197		100	%
NY		87,950		97	%		3,165		3	%		-		0	%		-		0	%		-		0	%		91,115		100	%
GA		30,527		43	%		16,309		23	%		23,392		33	%		-		0	%		-		0	%		70,228		100	%
IL		43,814		64	%		24,145		36	%		-		0	%		-		0	%		-		0	%		67,959		100	%
OH		39,647		60	%		13,854		21	%		12,847		19	%		-		0	%		-		0	%		66,348		100	%
CO		26,558		44	%		32,700		54	%		1,596		3	%		-		0	%		-		0	%		60,854		100	%
CA		46,211		83	%		9,602		17	%		-		0	%		-		0	%		-		0	%		55,813		100	%
Other		502,576		70	%		113,910		16	%		97,314		14	%		-		0	%		-		0	%		713,800		100	%
Pre-refunded				0	%		-		0	%		-		0	%		62,809		100	%		-		0	%		62,809		100	%
Grand Total		1,079,538		64	%		336,199		20	%		150,443		9	%		62,809		4	%		50,363		3	%		1,679,353		100	%

Selective Insurance Group, Inc. and Consolidated Subsidiaries

Municipal Fixed Income Portfolio as of June 30, 2009

($ in millions)

(unaudited)

	Average	Market		% of Total			Unrealized/ Unrecognized
	Credit Rating	Value		Muni Portfolio			Gain/(Loss)
Uninsured Securities	AA+	$	890		53	%	$	23
Securities with Insurance Enhanced1	AA+		789		47	%		18
Without Insurance Enhancement	AA-
Total		$	1,679		100	%	$	41

1 Includes $22.0 million of unrated municipal fixed income securities which we consider to be investment grade.

A "BBB-" rating has been applied to these municipal fixed income securities in the interest of conservatism.

Note: Some amounts may not foot due to rounding.

Selective Insurance Group, Inc. and its Subsidiaries

Ratings on Municipal Fixed Income Portfolio

June 30, 2009

($ in millions)

(unaudited)

	Uninsured Securities					Insurance Enhanced Securities1					Underlying Rating of Insurance Enhanced Securities1					Total Municipal Fixed Income Portfolio (with Insurance Enhancement)					Total Municipal Fixed Income Portfolio (without Insurance Enhancement)
	(1)					(2)					(3)					(1) + (2)					(1) + (3)
S&P or equivalent ratings	Market Value		% of Total			Market Value		% of Total			Market Value		% of Total			Market Value		% of Total			Market Value		% of Total
AAA	$	474		53	%	$	219		28	%	$	63		8	%	$	693		42	%	$	537		32	%
AA+		152		17	%		72		9	%		89		11	%		224		14	%		241		14	%
AA		140		16	%		110		14	%		139		18	%		250		15	%		278		17	%
AA-		58		7	%		199		25	%		240		30	%		257		15	%		298		18	%
A+		30		3	%		58		7	%		92		12	%		88		5	%		122		7	%
A		9		1	%		110		14	%		74		9	%		120		7	%		83		5	%
A-		18		2	%		18		2	%		57		7	%		36		2	%		75		4	%
BBB+		1		0	%		3		0	%		8		1	%		4		0	%		9		1	%
BBB		7		1	%		2		0	%		-		0	%		8		0	%		7		0	%
BBB-		-		0	%		-		0	%		27		3	%		-		0	%		27		2	%
BB+		2		0	%		-		0	%		-		0	%		2		0	%		2		0	%
Total	$	890		100	%	$	789		100	%	$	789		100	%	$	1,679		100	%	$	1,679		100	%
Average Rating:		AA+					AA+					AA-					AA+					AA
Unrealized/Unrecognized Gain/(Loss):		23					18										41

1 Includes $22.0 million of unrated municipal fixed income securities which we consider to be investment grade.

A "BBB-" rating has been applied to these municipal fixed income securities in the interest of conservatism.

Selective Insurance Group, Inc. and Consolidated Subsidiaries

Structured Securities

June 30, 2009

($ in thousands)

(unaudited)

Portfolio Composition	Ratings Profile

•Market Value = $664,377 ; Unrealized/Unrecognized Gain/(Loss) = ($65,154)

•Held to Maturity (HTM) 46%; Available for Sale (AFS) 54%

•Structured Security Portfolio Average Rating = AA+

•Structured Securities = 18.5% of the Total Portfolio

Selective Insurance Group Inc. and Consolidated Subsidiaries

Structured Securities

Ratings Migration (1)

($ thousands)

(unaudited)

June 30, 2009

Original Rating			Current Rating														Downgraded
Rating	Amount		AAA		AA		A		BBB		BB		B		CC		$		%
AAA		686,586		608,406		11,683		20,643		18,551		2,816		15,527		8,960		78,180		11.4	%
AA		38,132		5,280		14,874						7,343				10,635		17,978		47.1	%
A		13,636						12,210				1,426						1,426		10.5	%
BBB		25,175								10,000		7,000		1,425		6,750		15,175		60.3	%
BB		5,000										5,000						-		0.0	%
Total Par Value		768,529		613,686		26,557		32,853		28,551		23,585		16,952		26,345		112,759		14.7	%

Note (1): Migration period is from the purchase date of each security to June 30, 2009

Selective Insurance Group, Inc. and Consolidated Subsidiaries

Residential Mortgage Backed (RMBS) and Residential ABS (RABS) Securities

June 30, 2009

($ in thousands)

(unaudited)

Portfolio Composition	Ratings Profile

•Market Value = $425,348; Unrealized/Unrecognized Gain/(Loss) = ($26,545)

•Held to Maturity (HTM) 41%; Available for Sale (AFS) 59%

•RMBS & RABS Portfolio Average Rating = AA+

•RMBS & RABS Securities = 11.8% of the Total Portfolio

Selective Insurance Group Inc. and Consolidated Subsidiaries

Residential Mortgage Backed (RMBS) and Asset Backed (RABS) Securities

Ratings Migration (1)

($ thousands)

(unaudited)

June 30, 2009

Original Rating			Current Rating												Downgraded
Rating	Amount		AAA		AA		A		BB		B		CC		$		%
AAA		453,852		414,920		11,683		2,762				15,527		8,960		38,932		8.6	%
AA		14,622		280						3,707				10,635		14,342		98.1	%
A		3,635						2,209		1,426						1,426		39.2	%
BBB		1,425										1,425				1,425		100.0	%
BB		-														-		0.0	%
Total Par Value		473,534		415,200		11,683		4,971		5,133		16,952		19,595		56,125		11.9	%

Note (1): Migration period is from the purchase date of each security to June 30, 2009

Selective Insurance Group Inc. and Consolidated Subsidiaries

Residential Mortgage Backed Securities (RMBS) and Residential ABS (RABS)- by Vintage Year

June 30, 2009

($ in thousands)

(unaudited)

Market Value

Vintage Yr	AAA			AA			A			BB			B			CC			Total			% of Total RMBS & RABS			% of Total Fixed Income Portfolio			% of Total GAAP Equity
1983	$	14		$	-		$	-		$	-		$	-		$	-		$	14			0	%		0	%		0	%
2002		52,827			-			1,776			-			-			-			54,603			13	%		2	%		6	%
2003		60,240			-			837			-			-			-			61,078			14	%		2	%		6	%
2004		68,834			1,369			-			-			-			-			70,204			17	%		2	%		7	%
2005		32,703			7,626			-			-			-			-			40,329			9	%		1	%		4	%
2006		43,931			-			-			-			9,623			896			54,450			13	%		2	%		6	%
2007		7,739			-			-			1,335			333			1,584			10,991			3	%		0	%		1	%
2008		39,574			-			-			-			-			-			39,574			9	%		1	%		4	%
2009		94,106			-			-			-			-			-			94,106			22	%		3	%		11	%
Total RMBS & RABS-Market Value	$	399,968		$	8,996		$	2,614		$	1,335		$	9,956		$	2,480		$	425,348			100	%		13	%		45	%
% of Total RMBS & RABS		94	%		2	%		1	%		0	%		2	%		0	%		100	%
% of Total Fixed Income Portfolio		13	%		0	%		0	%		0	%		0	%		0	%		13	%
% of Total GAAP Equity		42	%		2	%		0	%		0	%		1	%		0	%		45	%
Weighted Average Market Price		104.6			76.4			15.1			8.9			331.9			27.4			92.8
Unrealized/Unrecognized Gain/(Loss)
Vintage Yr	AAA			AA			A			BB			B			CC			Total
1983	$	1		$	-		$	-		$	-		$	-		$	-		$	1
2002		840			-			(983	)		-			-			-			(143	)
2003		896			-			(1,352	)		-			-			-			(455	)
2004		143			(313	)		-			-			-			-			(169	)
2005		(9,383	)		(2,288	)		-			-			-			-			(11,671	)
2006		(4,902	)		-			-			-			(5,812	)		(524	)		(11,238	)
2007		160			-			-			(3,033	)		(179	)		-			(3,052	)
2008		(43	)		-			-			-			-			-			(43	)
2009		226			-			-			-			-			-			226
Total RMBS & RABS - Unrealized/Unrecognized	$	(12,062	)	$	(2,601	)	$	(2,334	)	$	(3,033	)	$	(5,991	)	$	(524	)	$	(26,545	)
% of Total RMBS & RABS		45	%		10	%		9	%		11	%		23	%		2	%		100	%

Note: Some amounts may not foot due to rounding.

Selective Insurance Group Inc. and Consolidated Subsidiaries

Residential Mortgage Backed Securities (RMBS) and Residential ABS (RABS)- by Type

June 30, 2009

($ in thousands)

(unaudited)

Market Value

RMBS Type	AAA			AA			A			BB			B			CC			Total			% of Total RMBS & RABS			% of Total Fixed Income Portfolio			% of Total GAAP Equity
Agency	$	352,264		$	-		$	-		$	-		$	-		$	-		$	352,264			83	%		11	%		37	%
FHA/VA		9,308			-			-			-			-			-			9,308			2	%		0	%		1	%
Total Agency		361,572			-			-			-			-			-			361,572			85	%		11	%		38	%
Alt-A		22,555			1,369			-			-			2,309			-			26,234			6	%		1	%		3	%
Alt-A CDO		-			-			-			-			-			896			896			0	%		0	%		0	%
Home Equity ABS		-			-			1,776			-			-			-			1,776			0	%		0	%		0	%
Non-Agency & Other Prime		15,841			7,626			837			1,335			7,647			1,584			34,871			9	%		1	%		4	%
Total RMBS & RABS-Market Value	$	399,968		$	8,996		$	2,614		$	1,335		$	9,956		$	2,480		$	425,348			100	%		13	%		45	%
% of Total RMBS & RABS		94	%		2	%		1	%		0	%		2	%		0	%		100	%
% of Total Fixed Income Portfolio		13	%		0	%		0	%		0	%		0	%		0	%		13	%
% of Total GAAP Equity		42	%		2	%		0	%		0	%		1	%		0	%		45	%
Weighted Average Market Price		104.6			76.4			15.1			8.9			331.9			27.4			92.8
Unrealized/Unrecognized Gain/(Loss)
RMBS Type	AAA			AA			A			BB			B			CC			Total
Agency	$	6,954		$	-		$	-		$	-		$	-		$	-		$	6,954
FHA/VA		(2,191	)		-			-			-			-			-			(2,191	)
Total Agency		4,764			-			-			-			-			-			4,764
Alt-A		(7,744	)		(313	)		-			-			(5,812	)		-			(10,132	)
Alt-A CDO		-			-			-			-			-			(524	)		(524	)
Home Equity ABS		-			-			(983	)		-			-			-			(983	)
Non-Agency & Other Prime		(9,082	)		(2,288	)		(1,352	)		(3,033	)		(179	)		-			(19,670	)
Total RMBS & RABS - Unrealized/Unrecognized	$	(12,062	)	$	(2,601	)	$	(2,334	)	$	(3,033	)	$	(5,991	)	$	(524	)	$	(26,545	)
% of Total RMBS & RABS		45	%		10	%		9	%		11	%		23	%		2	%		100	%

Note: Some amounts may not foot due to rounding.

Selective Insurance Group, Inc. and Consolidated Subsidiaries

Alt-A Securities

June 30, 2009

($ in thousands)

(unaudited)

Portfolio Composition	Ratings Profile

· Market Value = $27,130; Unrealized/Unrecognized Gain/(Loss) = ($10,656)

· Held to Maturity (HTM) 3% ; Available for Sale (AFS) 97%

· Alt-A Portfolio S&P Average Rating = AA+

· Alt-A Securities = 0.8% of the Total Portfolio

–Fixed-30 Loan-to-Value Ratio = 72.7%

–Hybrid ARM Loan-to-Value Ratio = 71.8%

–Fixed-15 Loan-to-Value Ratio = 41.1%

Selective Insurance Group, Inc. and Consolidated Subsidiaries

ALT-A by Vintage Year

June 30, 2009

($ in thousands)

(unaudited)

Market Value

Vintage Yr	ALT-A Fixed-15			Alt-A Fixed-30			Alt-A Hybrid ARM			Alt-A CDO			Total			% of Total Alt- A			% of Total Fixed Income Portfolio			% of Total GAAP Equity
2002	$	4,850		$	-		$	-		$	-		$	4,850			18	%		0	%		1	%
2003		-			1,563			391			-			1,954			7	%		0	%		0	%
2004		-			1,819			1,491			-			3,310			12	%		0	%		0	%
2005		-			3,094			2,413			-			5,507			20	%		0	%		1	%
2006		-			8,304			2,309			896			11,509			43	%		1	%		1	%
Total ALT-A, Market Value	$	4,850		$	14,780		$	6,603		$	896		$	27,130			100	%		1	%		3	%
% of Total ALT-A		18	%		55	%		24	%		3	%		100	%
% of Total Fixed Income Portfolio		0	%		1	%		0	%		0	%		1	%
% of Total GAAP Equity		0	%		2	%		1	%		0	%		3	%
Weighted Average Market Price		90.7			23.7			57.2			9.9			30.7
Unrealized/Unrecognized Gain/(Loss)
Vintage Yr	ALT-A Fixed-15			Alt-A Fixed-30			Alt-A Hybrid ARM			Alt-A CDO			Total
2002	$	(180	)	$	-		$	-		$	-		$	(180	)
2003		-			(372	)		(75	)		-			(447	)
2004		-			(118	)		(356	)		-			(474	)
2005		-			(496	)		(1,981	)		-			(2,477	)
2006		-			(4,478	)		(2,076	)		(524	)		(7,078	)
Total ALT-A, Unrealized/Unrecognized	$	(180	)	$	(5,464	)	$	(4,488	)	$	(524	)	$	(10,656	)
% of Total ALT-A		2	%		51	%		42	%		5	%		100	%

Note: Some amounts may not foot due to rounding.

Selective Insurance Group, Inc. and Consolidated Subsidiaries

Commercial Mortgage Backed (CMBS) Securities

June 30, 2009

($ in thousands)

(unaudited)

Portfolio Composition	Ratings Profile

· Market Value = $184,628; Unrealized/Unrecognized Gain/(Loss) = ($32,805)

· Held to Maturity (HTM) 53%; Available for Sale (AFS) 47%

· CMBS Portfolio Average Rating = AA+

· CMBS Securities = 5.1% of the Total Portfolio

Selective Insurance Group Inc. and Consolidated Subsidiaries

Commercial Mortgage Backed Securities (CMBS)

Ratings Migration (1)

($ thousands)

(unaudited)

June 30, 2009

Original Rating			Current Rating								Downgraded
Rating	Amount		AAA		A		BBB		BB		$		%
AAA		196,914		167,397		9,470		17,231		2,816		29,517		15.0	%
AA		8,635		5,000						3,635		3,635		42.1	%
A		-										-		0.0	%
BBB		17,000						10,000		7,000		7,000		41.2	%
BB		5,000								5,000		-		0.0	%
Total Par Value		227,549		172,397		9,470		27,231		18,451		40,152		17.6	%

Note (1): Migration period is from the purchase date of each security to June 30, 2009

Selective Insurance Group Inc. and Consolidated Subsidiaries

Commercial Mortgage Backed Securities (CMBS)- by Vintage Year

June 30, 2009

($ in thousands)

(unaudited)

Market Value

Vintage Yr	AAA			A			BBB			BB			Total			% of Total CMBS			% of Total Fixed Income Portfolio			% of Total GAAP Equity
1996	$	2,934		$	-		$	-		$	-		$	2,934			2	%		0	%		0	%
1999		3,887			-			-			-			3,887			2	%		0	%		0	%
2000		27,972			-			-			-			27,972			15	%		1	%		3	%
2001		26,808			-			-			-			26,808			14	%		1	%		3	%
2002		14,282			-			-			-			14,282			8	%		1	%		2	%
2003		1,893			-			-			-			1,893			1	%		0	%		0	%
2004		8,993			-			-			-			8,993			5	%		0	%		1	%
2005		1,048			1,207			889			253			3,398			2	%		0	%		0	%
2006		41,600			-			3,027			-			44,627			24	%		2	%		5	%
2007		33,658			1,544			1,456			3,406			40,064			22	%		1	%		4	%
2009		9,770			-			-			-			9,770			5	%		0	%		1	%
Total CMBS-Market Value	$	172,846		$	2,751		$	5,372		$	3,659		$	184,628			100	%		6	%		20	%
% of Total CMBS		94	%		1	%		3	%		2	%		100	%
% of Total Fixed Income Portfolio		5	%		0	%		1	%		0	%		6	%
% of Total GAAP Equity		18	%		0	%		1	%		1	%		20	%
Weighted Average Market Price		102.1			61.5			27.2			19.8			85.7
Unrealized/Unrecognized Gain/(Loss)
Vintage Yr	AAA			A			BBB			BB			Total
1996	$	(124	)	$	-		$	-		$	-		$	(124	)
1999		37			-			-			-			37
2000		217			-			-			-			217
2001		970			-			-			-			970
2002		831			-			-			-			831
2003		(111	)		-			-			-			(111	)
2004		(506	)		-			-			-			(506	)
2005		(408	)		(3,263	)		(3,912	)		(2,563	)		(10,145	)
2006		(1,439	)		-			(11,517	)		-			(12,956	)
2007		(225	)		(3,456	)		(1,407	)		(5,700	)		(10,787	)
2009		(230	)		-			-			-			(230	)
Total CMBS-Unrealized/Unrecognized	$	(988	)	$	(6,719	)	$	(16,835	)	$	(8,263	)	$	(32,805	)
% of Total CMBS		3	%		20	%		51	%		25	%		100	%

Note: Some amounts may not foot due to rounding.

Selective Insurance Group Inc. and Consolidated Subsidiaries

Commercial Mortgage Backed Securities (CMBS)- by Type

June 30, 2009

($ thousands)

(unaudited)

Market Value

CMBS Type	AAA			A			BBB			BB			Total			% of Total CMBS			% of Total Fixed Income Portfolio			% of Total GAAP Equity
Agency Multi-Family	$	108,896		$	-		$	-		$	-		$	108,896			59	%		3	%		12	%
Conduit		11,271			-			-			-			11,271			6	%		0	%		1	%
Fusion (1)		42,697			1,544			1,047			656			45,943			25	%		1	%		5	%
Lease-Backed		3,887			-			-			-			3,887			2	%		0	%		0	%
Re-Securitization		1,048			1,207			3,027			253			5,535			3	%		0	%		1	%
Single Borrower - Multiple Properties		5,047			-			1,299			2,750			9,096			5	%		0	%		1	%
Total CMBS-Market Value	$	172,846		$	2,751		$	5,373		$	3,659		$	184,628			100	%		6	%		20	%
% of Total CMBS		94	%		1	%		3	%		2	%		100	%
% of Total Fixed Income Portfolio		5	%		0	%		1	%		0	%		6	%
% of Total GAAP Equity		18	%		0	%		1	%		1	%		20	%
Weighted Average Market Price		102.1			61.5			27.2			19.8			85.7
Unrealized/Unrecognized Gain/(Loss)
CMBS Type	AAA			A			BBB			BB			Total
Agency MultiFamily	$	2,708		$	-		$	-		$	-		$	2,708
Conduit		(19	)		-			-			-			(19	)
Fusion (1)		(3,324	)		(3,456	)		(4,618	)		(3,450	)		(14,847	)
Lease-Backed		37			-			-			-			37
Re-Securitization		(408	)		(3,263	)		(11,517	)		(2,563	)		(17,750	)
Single Borrower - Multiple Properties		18			-			(701	)		(2,250	)		(2,933	)
Total CMBS-Unrealized/Unrecognized	$	(988	)	$	(6,719	)	$	(16,835	)	$	(8,263	)	$	(32,805	)
% of Total CMBS		3	%		20	%		51	%		25	%		100	%

(1) Fusion means a CMBS composed of large and small loans.

Note: Some amounts may not foot due to rounding.

Selective Insurance Group, Inc. and Consolidated Subsidiaries

2007 Vintage Commercial Mortgage Backed (CMBS) Securities

June 30, 2009

($ in thousands)

(unaudited)

Portfolio Composition	Ratings Profile

•Market Value = $40,064; Unrealized/Unrecognized Gain/(Loss) = ($10,787)

•Held to Maturity (HTM) 53%; Available for Sale (AFS) 47%

•2007 Vintage CMBS Portfolio Average Rating = AA+

•2007 Vintage CMBS Securities = 1.3% of the Fixed Income Portfolio

•2007 Vintage CMBS Securities = 1.1% of the Total Portfolio

Selective Insurance Group Inc. and Consolidated Subsidiaries

2007 Vintage Commercial Mortgage Backed Securities (CMBS)

June 30, 2009

($ in thousands)

(unaudited)

Market Value

CMBS Type	AAA			A			BBB			BB			Total			% of 2007 Vintage CMBS			% of  Total Fixed Income Portfolio			% of  Total GAAP Equity
Agency Multi-Family	$	29,977		$	-		$	-		$	-		$	29,977			75	%		1	%		3	%
Fusion (1)		3,680			1,544			157			656			6,038			15	%		0	%		1	%
Single Borrower - Multiple Properties		-			-			1,299			2,750			4,049			10	%		0	%		0	%
2007 Vintage CMBS-Market Value	$	33,658		$	1,544		$	1,456		$	3,406		$	40,064			100	%		1	%		4	%
% of 2007 Vintage CMBS		84	%		4	%		3	%		9	%		100	%
% of Total Fixed Income Portfolio		1	%		0	%		0	%		0	%		1	%
% of Total GAAP Equity		4	%		0	%		0	%		0	%		4	%
Weighted Average Market Price		68.5			30.9			29.1			21.8			57.4
Unrealized/Unrecognized Gain/(Loss)
CMBS Type	AAA			A			BBB			BB			Total
Agency MultiFamily	$	1,118		$	-		$	-		$	-		$	1,118
Fusion (1)		(1,343	)		(3,456	)		(706	)		(3,450	)		(8,954	)
Single Borrower - Multiple Properties		-			-			(701	)		(2,250	)		(2,951	)
2007 Vintage CMBS-Unrealized/Unrecognized	$	(225	)	$	(3,456	)	$	(1,407	)	$	(5,700	)	$	(10,787	)
% of 2007 Vintage CMBS		2	%		32	%		13	%		53	%		100	%

(1) Fusion means a CMBS composed of large and small loans

Note: Some amounts may not foot due to rounding.

Selective Insurance Group, Inc. and Consolidated Subsidiaries

2005 & 2006 Vintage Commercial Mortgage Backed (CMBS) Securities

June 30, 2009

($ in thousands)

(unaudited)

Portfolio Composition	Ratings Profile

•Market Value = $48,025; Unrealized/Unrecognized Gain/(Loss) = ($23,101)

•Held to Maturity (HTM) 32%; Available for Sale (AFS) 68%

•2005 & 2006 Vintage CMBS Portfolio Average Rating = AA+

•2005 & 2006 Vintage CMBS Securities = 1.5% of the Fixed Income Portfolio

•2005 & 2006 Vintage CMBS Securities = 1.3% of the Total Portfolio

Selective Insurance Group Inc. and Consolidated Subsidiaries

2005 & 2006 Vintage Commercial Mortgage Backed Securities (CMBS)

June 30, 2009

($ in thousands)

(unaudited)

Market Value

CMBS Type	AAA			A			BBB			BB			Total			% of 2005 & 2006 Vintage CMBS			% of Total Fixed Income Portfolio			% of Total GAAP Equity
Agency Multi-Family	$	32,759		$	-		$	-		$	-		$	32,759			68	%		2	%		3	%
Fusion (1)		8,842			-			889			-			9,731			20	%		0	%		1	%
Re-Securitization		1,048			1,207			3,027			253			5,535			12	%		0	%		1	%
2005 & 2006 Vintage CMBS-Market Value	$	42,649		$	1,207		$	3,916		$	253		$	48,025			100	%		2	%		5	%
% of 2005 & 2006 Vintage CMBS		89	%		3	%		7	%		1	%		100	%
% of Total Fixed Income Portfolio		2	%		0	%		0	%		0	%		2	%
% of Total GAAP Equity		5	%		0	%		0	%		0	%		5	%
Weighted Average Market Price		154.6			27.0			26.6			9.0			90.4
Unrealized/Unrecognized Gain/(Loss)
CMBS Type	AAA				A		BBB			BB			Total
Agency MultiFamily	$	(281	)	$	-		$	-		$	-		$	(281	)
Fusion (1)		(1,158	)		-			(3,912	)		-			(5,070	)
Re-Securitization		(408	)		(3,263	)		(11,517	)		(2,563	)		(17,750	)
2005 & 2006 Vintage CMBS-Unrealized/Unrecognized	$	(1,847	)	$	(3,263	)	$	(15,428	)	$	(2,563	)	$	(23,101	)
% of 2005 & 2006 Vintage CMBS		8	%		14	%		67	%		11	%		100	%

(1) Fusion means a CMBS composed of large and small loans

Note: Some amounts may not foot due to rounding.

Selective Insurance Group, Inc. and Consolidated Subsidiaries

Fixed Maturity Securities

Severity and Duration of Unrealized/Unrecognized Losses

June 30, 2009

($ in millions)

(unaudited)

	Unrealized/ Unrecognized			Fair
Fair Value as a Percentage of Amortized Cost	(Loss) Gain			Value
85% but less than 100% of amortized cost	$	(23.2	)		652.4
75% or more but less than 85% of amortized cost		(10.9	)		45.4
Less than 75% of amortized cost		(64.6	)		53.5
Gross unrealized/unrecognized losses on fixed maturity securities		(98.7	)		751.3
Gross unrealized/unrecognized gains on fixed maturity securities		81.8			2,427.0
Net unrealized/unrecognized losses on fixed maturity securities	$	(16.9	)		3,178.3

Duration of Unrealized/Unrecognized Loss Position	75% or more but less than 85% of Amortized Cost			Less than 75% of Amortized Cost
0 – 3 months	$	(1.6	)		(2.5	)
4 – 6 months		(1.2	)		(7.3	)
7 – 9 months		(3.5	)		(27.9	)
10 – 12 months		(3.9	)		(7.2	)
Greater than 12 months		(0.7	)		(19.7	)
Gross unrealized/unrecognized losses	$	(10.9	)		(64.6	)

Selective Insurance Group, Inc. and Consolidated Subsidiaries

Credit Quality of Available for Sale Securities

June 30, 2009

($ in millions)

(unaudited)

	June 30, 2009						December 31, 2008
	Fair Value		Unrealized Gain (Loss)			Credit Quality	Fair Value		Unrealized Gain (Loss)			Credit Quality
AFS Portfolio:
U.S. government obligations1	$	231.4		1.9		AAA		252.2		16.6		AAA
State and municipal obligations		424.9		17.8		AA+		1,758.0		18.6		AA+
Corporate securities		301.1		4.5		A+		366.5		(22.9	)	A
Mortgage-backed securities ("MBS")		335.8		(26.0	)	AA+		596.2		(86.1	)	AA+
Asset-backed securities ("ABS")		22.9		(1.4	)	AA		61.4		(15.3	)	AA
Total AFS portfolio	$	1,316.1		(3.2	)	AA+		3,034.3		(89.1	)	AA+
State and Municipal Obligations:
Government obligations	$	252.6		9.9		AA+		574.1		16.2		AA+
Special revenue obligations		172.3		7.9		AA+		1,183.9		2.4		AA+
Total state and municipal obligations	$	424.9		17.8		AA+		1,758.0		18.6		AA+
Corporate Securities:
Financial	$	61.3		(0.8	)	A+		101.0		(13.1	)	A+
Industrials		48.8		1.4		A-		67.7		(2.1	)	A-
Utilities		23.6		0.7		A-		47.6		(0.8	)	A
Consumer discretionary		35.6		1.0		AA-		33.9		(1.5	)	A-
Consumer staples		35.9		0.9		A+		42.0		0.5		A
Health care		29.2		1.5		AA		22.7		0.7		A+
Materials		14.2		(0.7	)	BBB+		13.2		(3.7	)	BBB+
Energy		29.7		0.8		AA-		19.1		(0.2	)	A-
Information technology		11.4		(0.6	)	A+		10.1		(1.9	)	BBB
Telecommunications services		11.4		0.3		A		9.2		(0.8	)	A-
Total corporate securities	$	301.1		4.5		A+		366.5		(22.9	)	A
MBS:
Agency CMBS	$	86.4		1.9		AAA		72.9		2.8		AAA
Non-agency CMBS		-		-		-		154.3		(34.8	)	AAA
Agency RMBS		188.5		1.7		AAA		245.5		4.2		AAA
Non-agency RMBS		34.7		(19.5	)	AA-		74.3		(28.4	)	AA+
Alternative-A ("Alt-A") RMBS		26.2		(10.1	)	AA+		49.2		(29.9	)	AA+
Total MBS	$	335.8		(26.0	)	AA+		596.2		(86.1	)	AA+
ABS:
ABS	$	22.9		(1.4	)	AA		59.3		(15.1	)	AA+
Alt-A ABS		-		-		-		0.9		-		B
Sub-prime ABS2		-		-		-		1.2		(0.2	)	A
Total ABS	$	22.9		(1.4	)	AA		61.4		(15.3	)	AA

1 U.S. Governemnt includes coporate securities fully guaranteed by the FDIC.

2 We define sub-prime exposure as exposure to direct and indirect investments in non-agency residential mortgages with average FICO® scores below 650.

Selective Insurance Group, Inc. and Consolidated Subsidiaries

Credit Quality of Held to Maturity Securities

June 30, 2009

($ in millions)

(unaudited)

	Fair Value		Carry Value		Unrecognized Holding Gain (Loss)2			Unrealized Gain (Loss) in Other Comprehensive Income3			Total Unrealized / Unrecognized Gain (Loss)			Credit Quality
HTM Fixed Maturity Portfolio1:
U.S. government obligations	$	193.5		194.4		(0.9	)		6.5			5.6		AAA
State and municipal obligations		1,254.4		1,269.8		(15.4	)		38.3			22.9		AA
Corporate securities		108.5		106.4		2.1			(6.6	)		(4.5	)	A-
Mortgage-backed securities		271.5		277.0		(5.5	)		(26.3	)		(31.8	)	AAA
Asset-backed securities		34.2		32.8		1.4			(7.3	)		(5.9	)	AA
Total HTM portfolio	$	1,862.1		1,880.4		(18.3	)		4.6			(13.7	)	AA+
State and Municipal Obligations:
Government obligations	$	305.5		311.1		(5.6	)		16.7			11.1		AA+
Special revenue obligations		948.9		958.7		(9.8	)		21.6			11.8		AA
Total state and municipal obligations	$	1,254.4		1,269.8		(15.4	)		38.3			22.9		AA
Corporate Securities:
Financial	$	32.4		31.4		1.0			(4.4	)		(3.4	)	A
Industrials		30.5		28.8		1.7			(2.3	)		(0.6	)	A-
Utilities		15.2		16.5		(1.3	)		(0.1	)		(1.4	)	A-
Consumer discretionary		6.2		6.1		0.1			0.1			0.2		BBB+
Consumer staples		19.0		18.6		0.4			0.5			0.9		AA-
Materials		2.0		1.9		0.1			(0.1	)		-		BBB-
Energy		3.2		3.1		0.1			(0.3	)		(0.2	)	BB+
Total corporate securities	$	108.5		106.4		2.1			(6.6	)		(4.5	)	A-
MBS:
Agency CMBS	$	22.6		22.2		0.4			0.4			0.8		AAA
Non-agency CMBS		75.7		82.2		(6.5	)		(29.0	)		(35.5	)	AAA
Agency RMBS		173.1		172.4		0.7			2.4			3.1		AAA
Non-agency RMBS		0.1		0.2		(0.1	)		(0.1	)		(0.2	)	AAA
Total MBS	$	271.5		277.0		(5.5	)		(26.3	)		(31.8	)	AAA
ABS:
ABS	$	32.3		30.8		2.5			(6.3	)		(3.8	)	AA+
Alt-A ABS		0.9		0.9		(1.2	)		(0.5	)		(1.7	)	CC
Sub-prime ABS4		1.0		1.1		0.1			(0.5	)		(0.4	)	A
Total ABS	$	34.2		32.8		1.4			(7.3	)		(5.9	)	AA

1 2008 HTM securities are not presented as they are not material

2 Unrecognized holding gains (losses) are equal to the fair value less the carry value of the security

3 Unrealized gains (losses) are equal to the fair value less the amortized costs of securities transferred from AFS to HTM at the date of transfer, adjusted for subsequent amortization into income

4 We define sub-prime exposure as exposure to direct and indirect investments in non-agency residential mortgages with average FICO® scores below 650.