BUILDING A HIGHLY ENGAGED TEAM OF EMPLOYEES AND LEADERS

We have created a NextGen program to identify and develop leaders, and prepare them to lead Selective in the future. We have graduated one NextGen leaders’ class, continued a holistic training and development program for our ongoing second class, and preliminarily identified a third class. In 2020, women and racially diverse employees accounted for 66% of the cohort.

We have created a strong pipeline of future employees through our Ignite college internship, and other recruitment programs. Our Ignite intern program involves a number of activities, including leadership and early career roundtables, networking opportunities with senior leaders, and group projects with a final presentation on a business issue to senior management. Our Momentum trainee program requires our trainees to complete a rigorous program that includes classroom learning, job shadow rotations, and on-the-job training.

In 2019, we built an Innovation Lab, named "Launch", at our Branchville, New Jersey headquarters. Our objective was to establish a platform for new, creative, and transformative ideas that could enhance our business and help shape our future. The Innovation Lab generates ideas and solutions that we expect will help us grow the business profitably, and also help our customers and distribution partners.

Selective has several programs focused on developing and providing employees with the skillsets they will need for future success in their careers. Selective is committed to the professional development of all our employees, and we are proud to invest in workplace and leadership development skills as part of our Leadership University program. All of our employees have access to over 25,000 online skills training courses and resources and a variety of live instructor-led training courses covering topics such as Unconscious Bias, Diversity, Empowerment and Leadership, Conversations and Feedback, Developing Others, Emotional Intelligence, and much more.

We require our officers, managers and supervisors to create robust development plans and emphasize year-round development for all employees. In evaluating performance, we focus on business objectives and leadership competencies.

Our efforts at investing in the talent and capabilities of our employees helps us retain our best talent. Our employee turnover was 8.2% in 2019 (compared to the national 9.1% rate reported by Mercer in its US Turnover Survey) and 5.5% in 2020. On average, 30% of open positions are filled by internal employees. Approximately 17% of our employees had been with Selective for over 20 years as of the end of 2020.

Before the COVID-19 pandemic, 28% of our employees worked full time from their homes, often in roles servicing our customers and distribution partners in various regions. Providing workplace flexibility to a substantial portion of our workforce has allowed us to retain high-level talent. It also enabled us to transition smoothly into a fully-remote environment during the pandemic. We have invested significantly in our technology resources to assist our employees, including enhancing cybersecurity tools and resources. As we prepare for our employees to return to a post-pandemic work environment, we have made some permanent changes to our workplace to increase flexibility and enhance employee engagement and productivity.

Helping our Employees during COVID-19 Pandemic

• Equipped all employees with technology and enhanced collaboration tools to stay connected and facilitate work-from-home
• Enabled flexible work schedules to allow employees to balance their personal and professional commitments
• Launched a Working Caregiver employee resource group to bring together employees seeking support and guidance to balance their work and home life
• Increased employee communications and hosted monthly town hall events to keep them informed and address questions
• For the few essential employees required to, or those employees who chose to work from the office, we introduced special health and safety protocols, including enhanced regular cleaning, hand sanitizer stations, daily health questionnaires, contact tracing, and mask, social distancing, and room capacity requirements
• Raised awareness about mental health issues by sharing resources and practical tools for all employees, including for stress management and locating assistance

Incorporating More Post-Pandemic Workplace Flexibility

• Providing most employees up to two days per week of work-from-home, with additional flexibility for inclement weather and caring for a short-term sick household member or dependent
• Developing office workspaces that foster collaboration and idea-generation

We are committed to fair pay, and we regularly analyze and adjust compensation to ensure both internal equity and alignment with the external market. All of our full and part-time regular employees are eligible to participate in an annual bonus program, and our recognition platform 27 allows all employees to acknowledge the contributions of other employees. We also offer financial workshops that help our employees plan for the future, regardless of career experience.

The health and well-being of our employees are vital. We offer a range of programs to foster a positive work-life balance. Our benefit programs are designed to enhance our employees' health, provide preventative care, and help manage existing medical conditions.

We support our employees by fostering a culture that emphasizes involvement with family and friends and connections with colleagues and our communities. Company events like Summer Kick-Off, Employee Appreciation Day, the Annual Toy Drive, and Build-a-Bike, allow our employees to socialize, feel valued, and give back. The employee run VIBES team has been instrumental in enhancing employee engagement through various initiatives, including a company-paid Volunteer Day, Selective Spirit Day, Logo Bowl, and Earth Day Activities.

Selective is actively committed to increasing diversity across our workforce, including gender, ethnicity and race. Our employee base has a strong gender mix. It also includes four generations of our workforce working side-by-side. Approximately 20% of our employees identify as diverse based on racial and ethnic backgrounds, including but not limited to a combination of Black, Latino, and Asian. We have established numerous initiatives to make Selective a more attractive place to work, and a more open, diverse, and inclusive organization.

Selective's Diversity, Equity & Inclusion Council:

Members of the DE&I Council include employees and senior leaders from various departments and offices. The mission of our DE&I Council is to promote a culture of diversity, equity, and inclusion where all individuals feel respected, are treated fairly and have an opportunity to excel in their chosen careers. To that end, the Council helps facilitate events, focus groups, and seminars to solicit input and ideas around strategy, empowerment, recruiting, personal growth, and inclusion. The Council has been a resource for Management as we have implemented various DE&I initiatives across the company.

We are also committed to highlighting the importance of diversity to various stakeholders – including customers, distribution partners, vendors, and our communities. Some of our recent programs have included:

Women's Agency Leadership Initiative

We developed the Women’s Agency Leadership Initiative to help our distribution partners increase the number of women in insurance agency leadership roles. The initiative seeks to provide women in insurance opportunities to network, share ideas, and access high-impact training sessions. Since 2017, this initiative has expanded to include female distribution partners from all six of our regions, an annual excess and surplus lines partner event, a virtual flood distribution partner forum, and input and participation from women on our Board of Directors

We are committed to increasing supplier diversity by providing opportunities for diverse suppliers to compete for our business. Our diversity program seeks to engage the best suppliers who share our values of trust, integrity, inclusion, and service excellence. Selective's supplier diversity program includes business enterprises owned by racial and ethnic minorities, women, veterans, and lesbian, gay, bisexual and transgender owners.

Outside Counsel Diversity program 

We are committed to actively recruiting and engaging qualified minority- and women-owned outside law firms for our claims handling processes. In selecting new outside law firms, minority and/or women-owned law firm designations are strongly considered.