SAFT · Safety Insurance Group, Inc.

Safety Insurance Group's Q1 2026 results were heavily impacted by two severe winter storms in the Northeast—a nor’easter on January 23 and another event on February 22—resulting in over 1,600 property claims and $42.7 million in damage, contributing 14.6 percentage points to the combined ratio of 113.4%. This drove losses and loss adjustment expenses up 30.1% to $247.5 million, pushing the loss ratio to 85.1% from 69.8% a year ago. CEO George M. Murphy highlighted these events as the primary factor behind the quarter's underperformance. Despite the catastrophe losses, net earned premiums grew 6.7% to $291.0 million, supported by rate increases averaging 4.0% in private passenger auto, 6.1% in commercial auto, and 9.9% in homeowners lines. Direct and net written premiums saw modest 0.3% and 0.2% increases, respectively, reflecting rate actions amid flat volume. Net investment income rose 16.9% to $17.0 million on higher assets and reinvestment yields, with portfolio yield at 4.1% (up from 3.9%) and fixed maturity duration steady at 3.9 years. Prior year favorable reserve development was $10.5 million, slightly below the $12.2 million in Q1 2025. Book value per share declined to $58.28 from $60.98 at year-end 2025, reflecting the net loss and fixed maturity valuation decreases. Total assets fell to $2.43 billion from $2.47 billion, with shareholders' equity at $856 million versus $892 million. The company maintained its dividend policy, paying $0.92 per share in Q1 (up from $0.90) and declaring the same for Q2, payable June 12 to June 1 record holders, signaling confidence in liquidity despite the quarterly loss.