XML 29 R17.htm IDEA: XBRL DOCUMENT v3.5.0.2
Retirement Plans
 6 Months Ended
Jun. 30, 2016
Compensation and Retirement Disclosure [Abstract]  
Retirement Plans
Retirement Plans
SICA's primary pension plan is the Retirement Income Plan for Selective Insurance Company of America (the “Pension Plan”). SICA also sponsors the Supplemental Excess Retirement Plan (the “Excess Plan”) and a life insurance benefit plan. All plans are closed to new entrants and benefits ceased accruing under the Pension Plan and the Excess Plan after March 31, 2016. For more information concerning SICA's retirement plans, refer to Note 14. “Retirement Plans” in Item 8. “Financial Statements and Supplementary Data.” of our 2015 Annual Report.

The following tables provide information regarding the Pension Plan:
 
 
Pension Plan
Quarter ended June 30,
 
Pension Plan
Six Months ended June 30,
($ in thousands)
 
2016
 
2015
 
2016
 
2015
Net Periodic Benefit Cost:
 
 
 
 
 
 
 
 
Service cost
 
$
—

 
1,912

 
1,606

 
3,825

Interest cost
 
3,101

 
3,407

 
6,203

 
6,816

Expected return on plan assets
 
(3,988
)
 
(3,990
)
 
(7,976
)
 
(7,981
)
Amortization of unrecognized net actuarial loss
 
1,481

 
1,644

 
2,961

 
3,287

Total net periodic cost
 
$
594

 
2,973

 
2,794

 
5,947


 
 
Pension Plan
Six Months ended June 30,
 
 
2016
 
2015
Weighted-Average Expense Assumptions:
 
 
 
 
Discount rate
 
4.69
%
 
4.29
Effective interest rate for calculation of service cost
 
4.52

 
—
Effective interest rate for calculation of interest cost
 
4.02

 
—
Expected return on plan assets
 
6.37

 
6.27
Rate of compensation increase
 
4.00

 
4.00


Effective January 1, 2016, the approach used to calculate the service and interest components of net periodic benefit cost for the Pension Plan was changed to provide a more precise measurement of these costs. Historically, we calculated the service and interest components utilizing a single weighted-average discount rate derived from the yield curve used to measure the benefit obligation at the beginning of the period. On January 1, 2016, we elected to utilize an approach that discounts the individual expected cash flows using the applicable spot rates derived from the yield curve over the projected cash flow period. We accounted for this change prospectively as a change in accounting estimate. The decrease in service cost reflected in the table above is attributable to the discontinuation of benefit accruals for existing participants as of March 31, 2016. 

We presently anticipate contributing approximately $56 million to the Pension Plan in 2016, $26.4 million of which has been funded as of June 30, 2016.