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spk04: The premium growth remains strong, and we think there's an opportunity to continue to generate some favorable rate there. So I think we feel good about the outlook for that line. On commercial lines, I'm glad you picked up on the point because we continue to see a little bit of sequential improvement in the quarter, and then we also gave you the April number at 5.2%. We didn't put the January number in there. You could solve for it. January is a bigger premium month, but January was 4.5%. So from January to April, it's about a 70 basis point pickup in renewal pure pricing. And I think it really ties into our earlier commentary relative to where the loss trend move is happening. And it is on the shorter tail lines. And that's where we're focusing. So as we go forward, we think there's an opportunity and a need to raise rates on those shorter tail lines to address some of the economic inflation that everybody is fighting here. But again, This is all in the context of really strong margins and very consistent margins and continued strong operating ROEs for selective.
spk02: Yeah, that makes sense. Sounds like it's more commercial auto and property-driven than compared to the other kind of liability lines based on what you're saying.
spk03: Yes.
spk02: Yep. And I wanted to ask, too, on commercial auto, you mentioned the severity, which, you know, certainly that's pretty evident out there, you know, average claims sizes and inflation is definitely hitting how much the average claims are. But if you could talk to you on the commercial auto side, what you're seeing in terms of frequency, whether you feel like that is sort of back to pre-pandemic levels or you're still getting a benefit there, but that benefits offset by the increased severity, just kind of what you're seeing on that line and what you're expecting for 22 and 23.
spk04: Yeah, I think from a commercial auto perspective, they continue to be a little bit better than pre-pandemic levels, and actually probably a little bit better than expected. Personal auto is a lot closer to pre-pandemic levels at this point, so it's really just more of a move in severity from our perspective. But frequencies are still a slight benefit on the auto physical damage side. And we continue to actually see favorable frequencies, as I mentioned, on a couple of the casualty lines, specifically in workers' comp and, to a lesser extent, auto liability and E&S liability.
spk02: Okay. That's helpful. And then the last one I just had was on the Argo rental rights deal. I think you mentioned early on that you expected $20 million to $40 million in premium from that. And then you mentioned this quarter it wasn't a major contributor. Last quarter it wasn't. Are you still expecting that, you know, to be within that range, or are you just not picking up as much business as you thought from that?
spk04: Yeah, I think, and I know Mark made reference to this in his prepared remarks, we are not seeing the success rate that we had anticipated. Now, again, that deal was structured where it's a pretty low-risk deal for us. We did pick up a fair amount of talent and some agency partnerships, but the point that we made when that transaction was announced is that the opportunity to renew that business was going to be dependent on our comfort level from an underwriting and a pricing perspective. And what we're seeing now is our hit ratios are significantly lower than expected because we're maintaining that discipline. And again, all of this is in the context of really strong E&S growth for us. So there's opportunities out there. It's just that that portfolio, I think, has been more of a struggle to meet our pricing and underwriting criteria as we look to renew those accounts. So overall, I would anticipate less than expected over the first year term of that renewal rights transaction.
spk02: Okay. Yep. Figured. Just want to clarify that. I appreciate that. Thanks for all the answers.
spk00: Thank you for your question. Before we take our next question, just a reminder, If you would like to ask a question, please press star 1 on your touch-tone phone. Please be sure to unmute your line and record your name to be introduced. We have a question from Mayor Shields with KBW. Your line is open.
spk01: Thanks. Good morning, all. Assuming that my math is correct, it looks like the underlying accident-year loss ratio for GL actually went up on a year-over-year basis. I guess I wasn't expecting that because you talked about higher loss trends in shorter tail lines. So I was hoping you could talk us through what's going on there.
spk03: Yeah, so I'll start and Mark could provide the details.
spk04: But Meyer, are you talking full year compared to the first quarter or are you talking first quarter to first quarter? Because first quarter to first quarter, the accident year GL is pretty much spot on. It was 88.9% last year, 89 this year, and just back out the prior year development.
spk01: Yeah, so I was looking year over year, but I guess it seems to be the same trend. It's not huge. I guess I would have expected it.
spk04: Yeah, we're talking a tenth of a point on the quarter and less than a point on the other 60 basis points on the full year. So I would call that flat on an accident year basis. And it's flat and really strong on a maximum basis at 89.
spk01: Okay, so that's certainly a fair description. I guess if I can shift gears, I know the workers' compensation book has been huge, and I think we've talked about this in the past, but are you seeing higher wages make their way into indemnity claims yet?
spk04: Well, I can't give you a specific answer on that, but I think it's a fairly safe assumption that the wage growth that we're seeing coming through is assumed in our indemnity loss cost assumptions. So we view that as one of the areas where exposure is a loss ratio neutral item. Doesn't hurt you, doesn't benefit you on the indemnity side. So our assumption would be if it hasn't actually happened yet, if those wages are coming through as exposure, your losses will move in tandem with it. And there's potentially a benefit on the medical side because wages, economy-wide, not talking specific to our book, but wage inflation is above medical inflation. So there is an inherent medical loss ratio benefit. And in our portfolio, and I think this is fairly reflective of the industry, the loss dollars, ultimate loss dollars, are about 50-50, indemnity and medical.
spk01: Okay, no, understood. Thank you so much.
spk03: Thank you.
spk00: Gentlemen, at this time, I have no further questions.
spk03: Okay. Well, thank you all for your participation and look forward to speaking to you again soon.
spk04: Thank you.
spk00: This does conclude today's conference call. We thank you all for participating. You may now disconnect and have a great rest of your day.
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