Thanks Rohan. Hello and thank you for joining us today. Before getting into the details of our performance for the third quarter and year-to-date, I think it’s important to put these results into proper context. We operate in a very challenging environment defined by historically high levels of economic inflation, high catastrophe losses and financial market volatility. Despite this difficult context, Selective continues to deliver solid and consistent results in terms of turnover and profit. In the first 9 months, net premiums written increased by 11% and our non-GAAP operating ROE was 11.6%. Based on our updated guidance for 2022, we expect to deliver an operational ROE of 12% for the full year, marking our ninth consecutive year of double-digit ROE for our shareholders.
While pleased with our overall results, our underlying combined ratio came under pressure due to the increased severity of property and vehicle damage. We remain disciplined to address this issue through a combination of pure price and exposure increases. On the other hand, rising inflation is also driving the higher interest rate environment. This has allowed us to achieve significant book yield in our investment portfolio and increase overall returns now and in the future.
Let’s move on to the results for the quarter. Net written premium growth of 11% was driven by high renewal rates in Standard Commercial Lines and Excess and Surplus Lines, strong retention rates and new business growth in Standard Commercial and Personal lines and positive change in exposure. Our combined ratio was 96.8% in the third quarter and 95.2% for the first 9 months. Catastrophe losses were 4 points in the quarter, which is in line with our expectations and includes a
On the other hand, non-catastrophic material losses are 3.3 points higher than our expectations. For the first 9 months of the year, losses of property other than cats were
1.8 points above our initial expectations, with approximately 60% of the excess losses attributable to the motor bodily injury lines of business. Although we have been highlighting it for a few quarters, this increase is mainly linked to economic inflationary pressures.
Across all property lines, current-year severities have increased by approximately 12.5% since the start of the year. Although frequencies increased slightly in the third quarter, they are generally in line with our expectations for the year to date. We continue to be diligent in adjusting building and content values to reflect these higher repair and replacement costs. Year-to-date, the change in renewal premiums was 12% for our commercial property portfolio and 10% for our E&S and landlord property portfolios.
For the commercial auto physical damage business, loss severity continues to reflect inflationary pressures for factors such as replacement parts, used vehicles and labor. Our efforts to address the continued challenge of profitability in the commercial automotive lineup focused on price increases, which averaged 8.7% in the third quarter and 8% for the first 9 months of the year.
On the property side, we remain confident in our current year loss ratio selections, which included an assumed loss trend of 5.5%. Additionally, we continue to see a favorable emergence from accidents from previous accident years. In the current accident year, reported loss frequencies continue to emerge better than expected and remain below pre-pandemic levels.
Pure renewal price increases for the Commercial Lines segment averaged 5.8% in the third quarter, 100 basis points higher than the first quarter and 50 basis points higher than the second quarter. Our retention rate of 86% remains high. Exposure growth during the third quarter was 3.8%, and the total premium change in our commercial insurance renewal portfolio was approximately 10%.
We intend to remain disciplined and consistent in seeking price increases that over time match our loss trend expectations. This long-term approach to getting the right price throughout the market cycle has defined our strategy over the past decade. As we look to 2023, we expect the commercial insurance pricing environment to remain constructive as industry-wide loss trends remain elevated and the reinsurance market continues to strengthen. .
I also want to share some thoughts on catastrophe losses, which have been well above industry expectations over the past 5 years. Although Hurricane Ian was not a significant loss event for Selective, this catastrophic loss of life and property reinforced the importance of understanding and managing exposure to major events. Over the past 20 years, our actual catastrophe losses have been lower than the industry average, measured in points on the combined ratio.
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