Segment Information

The disaggregated results of our four reportable segments are used by senior management to manage our operations. These reportable segments are evaluated as follows:


•	Our Standard Commercial Lines, Standard Personal Lines, and E&S Lines are evaluated based on before and after-tax underwriting results (net premiums earned, incurred loss and loss expense, policyholders dividends, policy acquisition costs, and other underwriting expenses), and combined ratios.


•	Our Investments segment is evaluated based on after-tax net investment income and net realized gains and losses.

In computing the results of each segment, we do not make adjustments for interest expense or corporate expenses. We do not maintain separate investment portfolios for the segments and therefore, do not allocate assets to the segments.

Our combined insurance operations are subject to certain geographic concentrations, particularly in the Northeast and Mid-Atlantic regions of the country. In 2017, approximately 20% of NPW were related to insurance policies written in New Jersey.

The goodwill balance of $7.8 million at both December 31, 2017 and 2016 relates to our Standard Commercial Lines reporting unit.

The following summaries present revenues (net investment income and net realized gains on investments in the case of the Investments segment) and pre-tax income for the individual segments:



Revenue by Segment	Years ended December 31,
($ in thousands)	2017		2016		2015
Standard Commercial Lines:
Net premiums earned:
Commercial automobile	$	442,818	398,942		358,909
Workers compensation	317,982		308,233		290,075
General liability	569,217		527,859		483,291
Commercial property	311,932		293,438		269,022
Businessowners’ policies	100,266		97,754		93,428
Bonds	29,086		23,227		20,350
Other	17,198		16,030		14,367
Miscellaneous income	9,488		7,782		6,343
Total Standard Commercial Lines revenue	1,797,987		1,673,265		1,535,785
Standard Personal Lines:
Net premiums earned:
Personal automobile	153,147		142,876		146,784
Homeowners	129,699		130,973		134,382
Other	6,855		6,758		6,968
Miscellaneous income	1,228		1,098		1,113
Total Standard Personal Lines revenue	290,929		281,705		289,247
E&S Lines:
Net premiums earned:
Casualty lines	157,366		151,638		126,064
Property lines	55,461		51,844		46,269
Miscellaneous income	—		1		—
Total E&S Lines revenue	212,827		203,483		172,333
Investments:
Net investment income	161,882		130,754		121,316
Net realized investment gains (losses)	6,359		(4,937	)	13,171
Total Investments revenues	168,241		125,817		134,487
Total revenues	$	2,469,984	2,284,270		2,131,852



Income Before Federal Income Tax	Years ended December 31,
($ in thousands)	2017			2016		2015
Standard Commercial Lines:
Underwriting gain, before federal income tax	$	149,514		146,435		164,496
Underwriting gain, after federal income tax	97,184			95,183		106,923
Combined ratio	91.6		%	91.2	%	89.2	%

Standard Personal Lines:
Underwriting gain, before federal income tax	11,104			12,419		1,336
Underwriting gain, after federal income tax	7,217			8,072		868
Combined ratio	96.2		%	95.6	%	99.5	%

E&S Lines:
Underwriting loss, before federal income tax	(6,282		)	(6,921	)	(16,803	)
Underwriting loss, after federal income tax	(4,083		)	(4,499	)	(10,922	)
Combined ratio	103.0		%	103.4	%	109.8	%

Investments:
Net investment income	$	161,882		130,754		121,316
Net realized investment gains (losses)	6,359			(4,937	)	13,171
Total investment income, before federal income tax	168,241			125,817		134,487
Tax on investment income	45,588			30,621		32,090
Total investment income, after federal income tax	$	122,653		95,196		102,397



Reconciliation of Segment Results to Income Before Federal Income Tax	Years ended December 31,
($ in thousands)	2017			2016		2015
Underwriting gain (loss)
Standard Commercial Lines	$	149,514		146,435		164,496
Standard Personal Lines	11,104			12,419		1,336
E&S Lines	(6,282		)	(6,921	)	(16,803	)
Investment income	168,241			125,817		134,487
Total all segments	322,577			277,750		283,516
Interest expense	(24,354		)	(22,771	)	(22,428	)
Corporate expenses	(36,255		)	(35,024	)	(28,396	)
Income, before federal income tax	$	261,968		219,955		232,692