UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934

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SELECTIVE INSURANCE GROUP, INC.

 

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		Selective Insurance Group, Inc. 40 Wantage Avenue Branchville, New Jersey 07890 (973) 948-3000

March 26, 2009

NOTICE OF 2009 ANNUAL MEETING OF STOCKHOLDERS
AND PROXY STATEMENT

April 29, 2009

The 2009 Annual Meeting of Stockholders of Selective Insurance Group, Inc. (“Selective”) will be held at 3:00 PM on Wednesday, April 29, 2009, in the Auditorium at Selective’s principal offices, which have both a physical and mailing address of 40 Wantage Avenue, Branchville, New Jersey 07890.

At the meeting, we will ask stockholders to:

1.

Elect three (3) Class II directors for a term expiring in 2012;

2.

Approve the amended and restated Selective Insurance Group, Inc. Employee Stock Purchase Plan (2009);

3.

Ratify the appointment of KPMG LLP as independent public accountants for the fiscal year ending December 31, 2009; and

4.

Consider and vote upon a stockholder proposal relating to the declassification of the Board of Directors.

We plan a brief business meeting focused on these items and we will attend to any other business as may properly come before the meeting and at any adjournments or postponements of the meeting. The Board of Directors recommends that you vote in favor of Items 1, 2, 3, and 4. These proposals are further described in the proxy statement.

Also enclosed is Selective’s 2008 Annual Report to Stockholders. At the meeting, we will be making a brief presentation on operations and we will offer time for your comments and questions.

Selective stockholders of record at the close of business on March 9, 2009 are entitled to notice of and to vote at the meeting and any adjournment of it. A quorum is a majority of outstanding shares. YOUR VOTE IS IMPORTANT. WE URGE YOU TO VOTE YOUR SHARES BY: (1) CALLING THE TOLL-FREE TELEPHONE NUMBER LISTED ON THE PROXY CARD; (2) ACCESSING THE INTERNET WEBSITE LISTED ON THE PROXY CARD; OR (3) COMPLETING, DATING, AND SIGNING THE ENCLOSED PROXY CARD AND RETURNING IT IN THE ENCLOSED ENVELOPE. YOUR PROXY MAY BE REVOKED AT ANY TIME, AS DESCRIBED IN THE PROXY STATEMENT, PRIOR TO THE TIME IT IS VOTED AT THE 2009 ANNUAL MEETING.

Very truly yours,

Gregory E. Murphy
Chairman of the Board, President and Chief Executive Officer

By Order of the Board of Directors:

Robyn P. Turner
Corporate Secretary

TABLE OF CONTENTS

PROXY STATEMENT			1
GENERAL INFORMATION ABOUT SELECTIVE’S ANNUAL MEETING			1
PROPOSALS FOR STOCKHOLDER VOTE AND APPROVAL REQUIREMENTS			2
OTHER MATTERS TO COME BEFORE THE ANNUAL MEETING			3
VOTING AND PROXY PROCEDURE			4
INFORMATION ABOUT PROPOSAL 1			6
SECURITY OWNERSHIP OF MANAGEMENT AND CERTAIN BENEFICIAL OWNERS			10
EXECUTIVE OFFICERS			11
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS			11
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE			13
CORPORATE GOVERNANCE			13
BOARD MEETINGS AND COMMITTEES			14
STOCKHOLDER COMMUNICATIONS			17
CODE OF CONDUCT			17
EXECUTIVE COMPENSATION			18
Compensation Discussion and Analysis			18
Summary Compensation Table			30
Grants of Plan Based Awards			32
Option Exercises and Stock Vested			34
Pension Benefits			35
Nonqualified Deferred Compensation			35
Employment Agreements and Potential Payments			37
DIRECTOR COMPENSATION			39
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION			40
COMPENSATION COMMITTEE REPORT			40
INFORMATION ABOUT PROPOSAL 2			42
INFORMATION ABOUT PROPOSAL 3			48
FEES OF INDEPENDENT PUBLIC ACCOUNTANTS			48
AUDIT COMMITTEE REPORT			49
INFORMATION ABOUT PROPOSAL 4			50
STOCKHOLDER PROPOSALS AND NOMINATIONS			52
DOCUMENTS INCORPORATED BY REFERENCE			53
SELECTIVE INSURANCE GROUP, INC. EMPLOYEE STOCK PURCHASE PLAN (2009)			A-1

PROXY STATEMENT

FOR THE 2009 ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD APRIL 29, 2009

GENERAL INFORMATION ABOUT SELECTIVE’S ANNUAL MEETING

WHEN AND WHERE IS THE ANNUAL MEETING?

The 2009 Annual Meeting of Stockholders (the “Annual Meeting”) of Selective Insurance Group, Inc. (“Selective” or the “Company”) will be held on Wednesday, April 29, 2009, at 3:00 PM in the Auditorium at Selective’s principal offices at 40 Wantage Avenue, Branchville, New Jersey 07890. Directions are on the back of the Proxy Statement.

WHO IS ENTITLED TO VOTE AT THE ANNUAL MEETING?

Anyone who owned Selective common stock as of the close of business on March 9, 2009, is entitled to one vote per share owned. There were 52,819,024 shares outstanding at the close of business on that date.

WHO IS SOLICITING MY PROXY TO VOTE MY SHARES AND WHEN?

Selective’s Board of Directors (“Board of Directors” or the “Board”) is soliciting your “proxy,” or your authorization for our named proxies, John C. Burville and Ronald L. O’Kelley, to vote your shares. Unless revoked by you, your proxy will be effective for the Annual Meeting and for any adjournments or continuations of that meeting.

WHAT IS THE COST OF SOLICITING PROXIES AND WHO IS PAYING FOR THE COST?

Selective is bearing the entire cost of soliciting proxies. Proxies will be solicited principally through the mail, but may also be solicited personally or by telephone, or special letter by directors, officers, and regular Selective employees for no additional compensation. Selective has engaged Georgeson Inc. (“Georgeson”), a proxy solicitation firm, to assist in the solicitation of proxies and the distribution of proxy materials, including reviewing Selective’s proxy materials, disseminating broker search cards, soliciting a proxy service company, brokers, banks, and institutional holders, and delivering executed proxies. Georgeson will provide such services for an estimated fee of approximately $7,500 plus expenses. Selective will reimburse banks, brokerage firms, and other custodians, nominees, and fiduciaries for reasonable expenses incurred by them in sending proxy materials to their customers or principals who are the beneficial owners of shares of Selective common stock.

WHAT ARE THE REQUIREMENTS FOR BUSINESS TO BE CONDUCTED AT THE ANNUAL MEETING?

For business to be conducted at the Annual Meeting, owners of 26,409,513 shares of Selective common stock (a majority of the issued and outstanding shares entitled to vote) constitute a quorum and must be in attendance or represented by proxy.

PROPOSALS FOR STOCKHOLDER VOTE AND APPROVAL REQUIREMENTS

Management is presenting three (3) proposals for a stockholder vote and a stockholder intends to present one (1) proposal for a stockholder vote.

PROPOSAL 1.		ELECTION OF DIRECTORS

THE BOARD RECOMMENDS THAT YOU VOTE FOR THE THREE NOMINATED CLASS II DIRECTORS: A. DAVID BROWN, S. GRIFFIN MC CLELLAN III, AND J. BRIAN THEBAULT.

You can find information about these nominees, as well as information about Selective’s Board of Directors, its committees, compensation for directors, and other related matters beginning on page 6.

New Jersey law and Selective’s By-laws govern the vote on Proposal 1, on which you may:

	•		Vote in favor of all the nominees;
	•		Withhold your votes as to all nominees; or
	•		Withhold your votes as to specific nominees.

Assuming a quorum is present, to be elected, a candidate must receive a plurality of the votes cast at the Annual Meeting in person or by proxy. Stockholders may not cumulate their votes. Abstentions and broker non-votes will have no effect on the outcome of the vote.

PROPOSAL 2.		APPROVAL OF AMENDED AND RESTATED SELECTIVE INSURANCE GROUP, INC. EMPLOYEE STOCK PURCHASE PLAN (2009)

THE BOARD RECOMMENDS THAT YOU VOTE FOR THE AMENDED AND RESTATED SELECTIVE INSURANCE GROUP, INC. EMPLOYEE STOCK PURCHASE PLAN (2009)

You can find information about the amended and restated Selective Insurance Group, Inc. Employee Stock Purchase Plan (2009) beginning on page 42.

New Jersey law and Selective’s By-laws govern the vote on Proposal 2, on which you may:

	•		Vote in favor of Proposal 2;
	•		Vote against Proposal 2; or
	•		Abstain from voting.

Assuming a quorum is present, Proposal 2 will pass if approved by an affirmative vote of a majority of votes cast at the Annual Meeting. Under New Jersey law, in determining whether the proposal has received the requisite number of affirmative votes, abstentions and broker non-votes will not be counted as votes and, accordingly, will have no effect on the outcome of the vote. A majority vote is also required to approve Proposal 2 for purposes of Sections 162(m) and 422 of the Internal Revenue Code of 1986, as amended (“Internal Revenue Code”).

PROPOSAL 3.		RATIFICATION OF APPOINTMENT OF INDEPENDENT PUBLIC ACCOUNTANTS

THE BOARD RECOMMENDS THAT YOU VOTE FOR THE RATIFICATION OF THE APPOINTMENT OF KPMG LLP AS INDEPENDENT PUBLIC ACCOUNTANTS FOR THE FISCAL YEAR ENDING DECEMBER 31, 2009.

You can find information about Selective’s relationship with KPMG LLP beginning on page 48.

New Jersey law and Selective’s By-laws govern the vote on Proposal 3, on which you may:

	•		Vote in favor of Proposal 3;
	•		Vote against Proposal 3; or
	•		Abstain from voting.

Assuming a quorum is present, Proposal 3 will pass if approved by an affirmative vote of a majority of the votes cast at the Annual Meeting. Under New Jersey law, in determining whether the proposal has received the requisite number of affirmative votes, abstentions and broker non-votes will not be counted as votes cast and, accordingly, will have no effect on the outcome of the vote.

PROPOSAL 4.		STOCKHOLDER PROPOSAL RELATING TO THE DECLASSIFICATION OF THE BOARD OF DIRECTORS.

THE BOARD RECOMMENDS THAT YOU VOTE FOR THE STOCKHOLDER PROPOSAL RELATING TO THE DECLASSIFICATION OF THE BOARD OF DIRECTORS.

You can find information about the stockholder proposal relating to the declassification of the Board of Directors beginning on page 50.

New Jersey law and Selective’s By-laws govern the vote on Proposal 4, on which you may:

	•		Vote in favor of Proposal 4;
	•		Vote against Proposal 4; or
	•		Abstain from voting.

Assuming a quorum is present, Proposal 4 will pass if approved by an affirmative vote of a majority of votes cast at the Annual Meeting. Under New Jersey law, in determining whether the proposal has received the requisite number of affirmative votes, abstentions and broker non-votes will not be counted as votes cast and, accordingly, will have no effect on the outcome of the vote.

OTHER MATTERS TO COME BEFORE THE ANNUAL MEETING

The Board of Directors is not aware of any other business to be presented for a vote of the stockholders at the Annual Meeting. If any other matters are properly presented for a vote, the people named as proxies will have discretionary authority, to the extent permitted by applicable law and NASDAQ Stock Market (“NASDAQ”) and United States Securities and Exchange Commission (“SEC”) rules and regulations, to vote on such matters according to their best judgment.

The Chairman of the Annual Meeting may refuse to allow presentation of a proposal or nominee for the Board of Directors if the proposal or nominee is not properly submitted. The requirements for submitting proposals and nominations for this year’s meeting were the same as those described on page 52 for next year’s meeting.

VOTING AND PROXY PROCEDURE

HOW DO I VOTE?

You can vote four (4) ways:

	1.		BY MAIL. Mark your voting instructions on, then sign and date the proxy card. Then return the proxy card in the postage-paid envelope provided. If you mail your proxy card, we must receive it before the beginning of the meeting.
			If we receive your signed proxy card, but you do not give voting instructions, the named proxies will vote your shares FOR Proposals 1, 2, 3, and 4. If any other matters arise during the meeting which require a vote, the named proxies will exercise their discretion, to the extent permitted by applicable law and NASDAQ and SEC rules and regulations.
	2.		BY TELEPHONE. Call the toll-free number on your proxy card to vote by telephone. Follow the instructions on your proxy card and the voice prompts. IF YOU VOTE BY TELEPHONE, YOU DO NOT NEED TO RETURN YOUR PROXY CARD.
	3.		BY INTERNET. Go to the website listed on your proxy card to vote through the Internet. Follow the instructions on your proxy card and the website. If you vote through the Internet, you may incur telephone and/or Internet access charges from your service providers. IF YOU VOTE BY INTERNET, YOU DO NOT NEED TO RETURN YOUR PROXY CARD.
	4.		IN PERSON. Attend the Annual Meeting, or send a personal representative with an appropriate proxy, in order to vote.

HOW DO I REVOKE MY PROXY OR CHANGE MY VOTING INSTRUCTIONS?

You may revoke your proxy before the proxy is exercised by writing to Selective’s Corporate Secretary, Robyn P. Turner, at the address in the meeting notice on the cover of this Proxy Statement. You may also change your vote before the proxy is exercised by entering a new vote via the Internet, by telephone, or by returning a properly executed proxy bearing a later date. Any subsequent timely and valid vote by any means will change your prior vote. For example, if you voted by telephone, a subsequent Internet vote will change your vote. The last vote received before noon central time on April 28, 2009 will be the vote that is counted, except that you may also change your vote by voting in person at the Annual Meeting.

HOW WILL PROXIES BE VOTED IF I GIVE MY AUTHORIZATION?

If you properly execute your proxy on the accompanying form, return it to Selective, or submit your proxy by telephone or Internet as described above, and do not subsequently revoke your proxy, your shares of common stock will be voted at the Annual Meeting in accordance with your instructions. In the absence of instructions, the named proxies will vote your shares “FOR” the election of each director nominee, “FOR” the approval of the Selective Insurance Group, Inc. Employee Stock Purchase Plan (2009), “FOR” the ratification of the appointment of KPMG LLP as Selective’s independent public accountants for the fiscal year ending December 31, 2009, and “FOR” the stockholder proposal relating to the declassification of the Board of Directors. If other matters should properly come before the meeting, the named proxies will vote on such matters, to the extent permitted by applicable law and NASDAQ and SEC rules and regulations, in accordance with their best judgment.

HOW WILL VOTES BE COUNTED?

The inspector of elections appointed by the Board of Directors for the Annual Meeting will separately tabulate affirmative and negative votes, abstentions and broker non-votes (shares held by a broker, bank or other nominee that does not have authority, either express or discretionary, to vote on a particular matter). Shares represented by proxies that reflect abstentions and broker non-votes are counted for determining whether there is a quorum. For Proposal 1, abstentions and broker non-votes will not be considered in determining whether director nominees have received the requisite number of affirmative votes. For Proposals 2, 3, and 4, approval will require the affirmative vote of a majority of votes cast at the Annual Meeting. Although abstentions and broker non-votes are treated as present for purposes of determining whether a quorum is present at the Annual Meeting, any shares not voted as a result of an abstention or a broker non-vote will not be counted as voting “for” or “against” Proposals 2, 3, and 4. Accordingly, abstentions and broker non-votes will not be counted as votes cast and will have no effect on the outcome of a vote.

WHAT IF MY SHARES ARE NOT REGISTERED IN MY NAME?

If you own your shares in “street name,” meaning that your broker is actually the record owner, you should contact your broker. When a broker does not have voting instructions and withholds its vote on one of these matters, it is called a “broker non-vote.” Broker non-votes count toward a quorum, but otherwise do not affect the outcome of any proposal.

IMPORTANT NOTICE REGARDING AVAILABILITY OF PROXY MATERIALS FOR THE ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON APRIL 29, 2009

This Proxy Statement is available on Selective’s internet website at www.selective.com.

INFORMATION ABOUT PROPOSAL 1
Election of Directors

Selective’s Board of Directors currently has twelve (12) members and is divided into three (3) classes designated Class I, Class II, and Class III. Pursuant to Selective’s Restated Certificate of Incorporation, as amended, and its By-laws, Selective may have a minimum of seven (7) and a maximum of twenty (20) directors. By majority vote, the Board of Directors may set the number of directors within this range at any time. Effective as of the Annual Meeting, the Board has set the number of directors at eleven (11). William M. Kearns, Jr., having surpassed the eligibility age for election as a director, will retire from the Board on April 29, 2009, following the election of directors at the 2009 Annual Meeting of Stockholders. The Board thanks Mr. Kearns for his many years of service as a Director and Lead Independent Director of the Board.

Under Selective’s By-laws, directors are elected at the Annual Meeting for terms of three (3) years, unless a director is being elected to fill a vacant, unexpired term. No family relationships exist between any of Selective’s current directors, executive officers, and persons nominated by Selective to become a director.

The Board has ratified the Corporate Governance and Nominating Committee’s nomination of the following three (3) incumbent Class II directors to stand for election at the Annual Meeting for terms expiring at the 2012 Annual Meeting or until a successor has been duly elected and qualified: A. David Brown, S. Griffin McClellan III, and J. Brian Thebault.

All three (3) nominees have consented to being named in this Proxy Statement and to serve if elected and the Board does not know of any reason why any of these nominees would decline or be unable to serve if elected. If a nominee becomes unavailable or unable to serve before the Annual Meeting, the Board can either reduce its size or designate a substitute nominee. If the Board designates a substitute nominee, proxies that would have been cast for the original nominee will be cast for the substitute nominee unless instructions are given to the contrary.

NOMINEES OF THE BOARD OF DIRECTORS

Name, Age, Year Elected To Board of Directors		Occupation And Background
A. David Brown, 66 Independent Director, 1996		•   Senior Vice President, Human Resources, Linens ‘n Things, Inc., 2006 to 2009. In May 2008, Linens and Things, Inc. filed for protection under Chapter 11 of the U.S. Bankruptcy Code.
		•   Managing Partner, Bridge Partners, LLC, an executive recruiting firm, 2003 to 2006.
		•   Partner, Whitehead Mann, executive recruiters, 1997 to 2003.
		•   Director, Hanover Direct, 2003 to 2006.
		•   Director, Zale Corporation, 1997 to 2006.
		•   Director, The Sports Authority, Inc., 1998 to 2003.
		•   Trustee, Jackie Robinson Foundation.
		•   Graduate of Monmouth University (B.S.).
S. Griffin McClellan III, 71		•   Retired Banking Executive.
Independent Director, 1980		•   Self-employed Consultant, 1994 to 2001.
		•   Graduate of Harvard University (B.A.).

Name, Age, Year Elected To Board of Directors		Occupation And Background
J. Brian Thebault, 57		•   Chairman, Earth-Thebault, since 2007.
Independent Director, 1996		•   Partner, Thebault Associates, since 2007.
		•   Chairman and Chief Executive Officer, L.P. Thebault Company, 1998 to 2007; President and Chief Executive Officer, L.P. Thebault Company, 1984 to 1998.
		•   Trustee, The Peck School, since 1994.
		•   Trustee, The Delbarton School, 1990 to 2007.
		•   Graduate of University of Southern California (B.S.).

CONTINUING DIRECTORS

Name, Age, Year Elected To Board of Directors		Occupation And Background
W. Marston Becker, 56 Independent Director, 2006		•   Chairman and CEO, Max Capital Group Ltd., since October 2006; Director, since 2004.
		•   Chairman and General Partner of West Virginia Media Holdings, since 2001.
		•   Chairman and CEO of LaSalle Re Holdings Ltd., 2002 to 2008.
		•   Director, BrickStreet Mutual Insurance Company, since 2008.
		•   Director, Dorado Insurance, Ltd., since 2007.
		•   Director, Coal Contractors Insurance, Ltd., since 2002.
		•   Chairman and Chief Executive Officer, Trenwick Group, Ltd., 2002 to 2005; Director, Trenwick Group, Ltd., 1997 to 2003.
		•   Director, Mountain Companies, since 2007.
		•   Director, Beazley Group plc, 2006 to 2008.
		•   CEO, McDonough-Caperton Insurance Group, 1986 to 1994.
		•   Advisory Board Member, Conning Funds, since 1997.
		•   Advisory Board Member, American Securities Funds, since 1997.
		•   Graduate of West Virginia University (B.S. and J.D.).
Gregory E. Murphy, 53		•   Chairman, President and Chief Executive Officer of Selective, since May 2000.
Employee Director, 1997		•   President and Chief Executive Officer of Selective, May 1999 to May 2000.
		•   President and Chief Operating Officer of Selective, 1997 to May 1999.
		•   Other senior executive, management, and operational positions at Selective, since 1980.
		•   Certified Public Accountant (New Jersey) (Inactive).
		•   Director, Newton Memorial Hospital Foundation, Inc., since 1999.
		•   Director, Property Casualty Insurers Association of America, since 2008.
		•   Director, Insurance Information Institute, since 2000.
		•   Trustee, the American Institute for CPCU (AICPCU) and the Insurance Institute of America (IIA), since 2001.
		•   Graduate of Boston College (B.S. Accounting).
		•   Harvard University (Advanced Management Program).
		•   M.I.T. Sloan School of Management.

Name, Age, Year Elected To Board of Directors		Occupation And Background
William M. Rue, 61		•   President, Rue Insurance, general insurance agency, since 1969.
Non-Independent Director, 1977		•   President, Rue Financial Services, Inc., since 2002.
		•   Director, 1st Constitution Bank, since 1989, Secretary of the Board, since 2005.
		•   Director, 1st Constitution Bancorp, since 1999, Secretary of the Board, since 2005.
		•   Director, Robert Wood Johnson University Hospital at Hamilton, since 1994.
		•   Trustee, Rider University, since 1993.
		•   Director, Robert Wood Johnson University Hospital Foundation, since 1999.
		•   Member, National Association of Securities Dealers.
		•   Member, Council of Insurance Agents & Brokers.
		•   Member, Society of CPCU.
		•   Member, Professional Insurance Agents Association.
		•   President, The Rue Foundation, since 2004.
		•   Graduate of Rider College (B.A.).

Name, Age, Year Elected To Board of Directors		Occupation And Background
Paul D. Bauer, 65		•   Retired financial executive.
Independent Director, 1998		•   Executive Vice President and Chief Financial Officer of Tops Markets, Inc., 1970 to 1993.
		•   Director, Rosina Holdings Inc., since 2002.
		•   Director, R.P. Adams Co., 1991 to 2004.
		•   Director, IMC, Inc., 1995 to 2000.
		•   Co-founder and President, Buffalo Inner-City Scholarship Opportunity Network, since 1995.
		•   Trustee, Holy Angels Academy, since 2005.
		•   Graduate of Boston College (B.S. Accounting).
John C. Burville, 61		•   Insurance Consultant to the Bermuda Government, 2003 to 2007.
Independent Director, 2006		•   Bermuda Insurance Advisory Committee, 1985 to 2003.
		•   Chief Actuary and Senior Rating Agency Manager of ACE Limited, 1992 to 2003.
		•   Graduate of Leicester University in the United Kingdom (BSc and Ph.D.).
		•   Fellow of the Institute of Actuaries.

Name, Age, Year Elected To Board of Directors		Occupation And Background
Joan M. Lamm-Tennant, 56		•   Risk Strategist, Marsh & McLennan Companies, Inc., since Feb. 2009.
Independent Director, 1993		•   Global Chief Economist & Risk Strategist, Guy Carpenter & Company, LLC, since 2007.
		•   Senior Vice President, General Re Corporation, 1997 to 2007.
		•   Adjunct Professor, the Wharton School of the University of Pennsylvania, since 2006.
		•   Professor of Finance, Villanova University, 1988 to 2000.
		•   Director, IVANS, Inc., since 2004.
		•   Member, American Risk and Insurance Association.
		•   Member, International Insurance Society.
		•   Member, Association for Investment Management and Research.
		•   Graduate of St. Mary’s University (B.B.A. and M.B.A.).
		•   Graduate of the University of Texas (Ph.D.).
Michael J. Morrissey, 61		•   Chairman and Chief Executive Officer, Firemark Investments, since 1983.
Independent Director, 2008		•   Director, CGA Group, Ltd., since 1998.
		•   President, Chief Operating Officer, Chief Investment Officer and Director, Manhattan Life Insurance Company, 1985 to 1987.
		•   Chief Executive Officer, Manhattan Capital Management, 1985.
		•   Senior Vice President, Crum & Forster Insurance Group, 1978 to 1983.
		•   Chartered Financial Analyst.
		•   Graduate of Boston College (B.A.).
		•   Graduate of Dartmouth College (M.B.A.).
Ronald L. O’Kelley, 64		•   President and Chief Executive Officer, U.S. Shipping Partners, L.P., since 2008.
Independent Director, 2005		•   Chairman and Chief Executive Officer, Atlantic Coast Venture Investments Inc., 2003 to 2008; Director, Atlantic Coast Venture Investments Inc., since 2003.
		•   Executive Vice President, Chief Financial Officer and Treasurer, State Street Corporation, 1995 to 2002.
		•   Director, U.S. Shipping Partners L.P., 2004 to 2008.
		•   Director, Refco Inc., 2005 to 2006.
		•   Advisory Director, Donald H. Jones Center for Entrepreneurship, Tepper School of Business, Carnegie Mellon University, since 2003.
		•   Member, National Association of Corporate Directors.
		•   Graduate of Duke University (A.B.).
		•   Graduate of Carnegie Mellon University (M.B.A.).

SECURITY OWNERSHIP OF MANAGEMENT AND CERTAIN BENEFICIAL OWNERS

The following table shows as of February 28, 2009:

	•		The number of shares of Selective common stock beneficially owned by each director, the Chairman of the Board, President and Chief Executive Officer (the “CEO”), the Chief Financial Officer (the “CFO”), and the three most highly compensated executive officers other than the CEO and CFO (collectively, with the CEO and CFO, referred to as the “named executive officers”).
	•		The number of shares of Selective common stock beneficially owned by the directors and executive officers of Selective as a group.

		Number of Shares
						Options
Name of Beneficial						Exercisable Within				Total Shares				Percent of
Owner		Common Stock (1)				60 Days				Beneficially Owned				Class
Bauer, Paul D.			38,001				51,544				89,545				*
Becker, W. Marston			12,225				15,544				27,769				*
Brown, A. David			40,208				45,544				85,752				*
Burville, John C.			7,813				15,544				23,357				*
Connell, Richard F.			50,337				17,184				67,521				*
Guthrie, Kerry A.			63,559	(2)			55,684				119,243				*
Kearns, William M., Jr.			201,579				51,544				253,123				*
Lamm-Tennant, Joan M.			45,373				51,544				96,917				*
McClellan, S. Griffin, III			40,825	(3)			27,544				68,369				*
Morrissey, Michael J.			1,045				0				1,045				*
Murphy, Gregory E.			121,381				70,002				191,383				*
O’Kelley, Ronald L.			15,326				21,544				36,870				*
Rue, William M.			410,338	(4)			51,544				461,882				1	%
Thatcher, Dale A.			53,494				17,184				70,678				*
Thebault, J. Brian			52,825	(5)			51,544				104,369				*
Zaleski, Ronald J., Sr.			35,755				41,176				76,931				*
All directors and executive officers, as a group (20 persons)			1,242,405				600,457				1,842,862				3	%

The following table lists the only persons or groups known to Selective to be the beneficial owner of more than 5% of any class of Selective’s voting securities as of December 31, 2008, based on Schedules 13G filed by the beneficial owners on February 9, 2009 and February 5, 2009, respectively, with the SEC.

Amount & Nature of

Percentage of

Title of Class

Name & Address of Beneficial Owner

Beneficial Ownership

Class

Common Stock

Dimensional Fund Advisors LP

4,480,467 shares

8.49

%

Palisades West, Building One

of common stock

6300 Bee Cave Road

Austin, TX 78746

Common Stock

Barclays Global Investors, NA and Affiliates

3,593,318 shares

6.81

%

400 Howard Street

of common stock

San Francisco, CA 94105

EXECUTIVE OFFICERS

Information regarding Executive Officers is incorporated by reference to the section entitled “Executive Officers of the Registrant” in Part I, Item 1. Business of Selective’s Annual Report on Form 10-K for the year ended December 31, 2008.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Transactions with Related Persons

William M. Rue, a Selective director, is President and owns more than 10% of the equity of Rue Insurance, a general independent insurance agency. Rue Insurance is an appointed independent agent of Selective’s insurance subsidiaries and Selective HR Solutions, Inc., Selective’s human resources administration subsidiary (together with its subsidiaries, “Selective HR Solutions”), on terms and conditions similar to those of other Selective agents, including the right to participate in the Selective Insurance Group, Inc. Stock Purchase Plan for Independent Insurance Agencies. Rue Insurance also places insurance for Selective’s business operations. Selective’s relationship with Rue Insurance has existed since 1928 and Selective expects that its relationship with Rue Insurance will continue in 2009. In 2008:

	•		Rue Insurance placed insurance policies with Selective’s insurance subsidiaries. Direct premiums written associated with these polices was $8.3 million in 2008, $9.9 million in 2007, and $9.5 million in 2006. In return, Selective’s insurance subsidiaries paid commissions to Rue Insurance of $1.7 million in 2008 and 2007, and $1.9 million in 2006.
	•		Rue Insurance placed human resource outsourcing contracts with Selective HR Solutions resulting in revenues to Selective HR Solutions of approximately $79,000 in 2008, $69,000 in 2007, and $62,000 in 2006. In return, Selective HR Solutions paid commissions to Rue Insurance of $12,000 in 2008, $15,000 in 2007, and $14,000 in 2006.
	•		Rue Insurance placed insurance coverage for Selective with non-Selective insurance companies for which Rue Insurance was paid commission pursuant to its agreements with those carriers. Selective paid premiums for such insurance coverage of $0.5 million in 2008, $0.5 million in 2007, and $0.5 million in 2006.
	•		Selective paid reinsurance commissions of $0.2 million in 2008, 2007, and 2006 to PL, LLC. PL, LLC is an insurance fund administrator of which Rue Insurance owns 33.33% and which places reinsurance through a Selective insurance subsidiary.

The son of S. Griffin McClellan III, a Selective director, Samuel G. McClellan IV, was an Assistant Vice President of Selective’s insurance subsidiaries through January 16, 2009. In 2008, Mr. McClellan IV received $139,740 in cash compensation, primarily comprised of salary and an annual cash incentive payment. He also received long-term incentive awards, consistent with awards granted to other Selective employees. Mr. McClellan IV’s compensation was determined in accordance with the standard employee compensation practices of Selective Insurance Company of America (“SICA”). Mr. McClellan III is not currently a member of the Audit Committee, the Corporate Governance and Nominating Committee, or the Salary and Employee Benefits Committee.

The daughter of Gregory E. Murphy, the Chairman, President and Chief Executive Officer of Selective, Kelly Murphy, ACAS, is employed as an actuarial analyst by Guy Carpenter & Company, LLC (“Guy Carpenter”), one of Selective’s reinsurance brokers. Guy Carpenter receives commissions from Selective’s reinsurers for business that Guy Carpenter places with such reinsurers on Selective’s behalf. Mr. Murphy’s daughter has no involvement in the relationship between Selective and Guy Carpenter.

In 2008, The Selective Group Foundation, a private foundation established by Selective under Section 501(c)(3) of the Internal Revenue Code (the “Selective Foundation”), made approximately $97,500 in grants to the Newton Memorial Hospital Foundation (“NMHF”), a charitable organization affiliated with Newton Memorial Hospital (“NMH”). Both NMH and NMHF are located in Sussex County, New Jersey, where Selective is headquartered. At the end of 2008, there were outstanding annually renewable pledges totaling $300,000 to NMHF. Mr. Murphy serves on the Board of Directors of NMHF. In 2008, the Selective Foundation also made $132,500 in grants to Project Self-Sufficiency of Sussex County (“PSS”), a non-profit, community-based organization dedicated to empowering low-income adults and their children to achieve personal and economic self-sufficiency. At the end of 2008, there were outstanding annually renewable pledges totaling $45,000 to PSS. Susan Murphy, Mr. Murphy’s wife, serves on the Board of Directors of PSS. In 2008, the Selective Foundation made a grant to the Morristown Memorial Heart Center of $20,000. At the end of 2008, there were outstanding renewal pledges totaling $60,000 to the Morristown Memorial Health Foundation. Mr. Kearns, Lead Independent Director, is a member of the Oncology Philanthropic Leadership Council, Carol G. Simon Cancer Center, Morristown Memorial Health Foundation. In 2008, the Selective Foundation made approximately $25,000 in grants to the United Way of Sussex County. Richard F. Connell, Senior Executive Vice President and Chief Administrative Officer of Selective, is a member of the Board of Trustees of the United Way of Sussex County. From time to time, the Selective Foundation makes grants to these and other charitable organizations in accordance with the Selective Foundation’s By-laws.

Review, Approval, or Ratification of Transactions with Related Persons

Selective’s Board of Directors adopted a written Related Person Transactions Policy and Procedures (the “Related Person Policy”) on January 30, 2007. The Related Person Policy defines “Related Person Transactions” as any transaction, arrangement or relationship in which Selective or its subsidiaries was, is, or will be a participant and the amount involved exceeds $20,000, and in which any “Related Person” had, has, or will have a direct or indirect interest. A “Related Person” under the Related Person Policy is generally (i) any director, executive officer, or nominee to become director of Selective or an immediate family member of such person; (ii) a beneficial owner of more than 5% of Selective’s common stock or an immediate family member of such beneficial owner; and (iii) any firm, corporation, or other entity in which any person included in (i) or (ii) is employed or is a general partner or principal or in a similar position or in which such person has a 5% or greater beneficial ownership interest.

Under the Related Person Policy, “Related Person Transactions” must be approved by the Audit Committee (or Chair of the Committee if between meetings). The Audit Committee considers all of the relevant facts and circumstances of the proposed transaction available to it, including (i) the benefits to Selective; (ii) the impact on a director’s independence; (iii) the availability of other sources for comparable products and services; (iv) the terms of the transaction; and (v) the terms available to unrelated third parties or to employees generally.

No member of the Audit Committee may participate in any review, consideration, or approval of any Related Person Transaction with respect to which such member or any of his or her immediate family members is the Related Person. The Audit Committee only approves those Related Person Transactions that are in, or are not inconsistent with, the best interests of Selective and its stockholders. Prior to the adoption of the Related Person Policy, Related Person Transactions, including those described above, were reported to, and considered by, the Board of Directors pursuant to Selective’s Conflict of Interest Policy.

Director Independence

The Board of Directors has determined that all directors, except Messrs. Murphy and Rue, are independent as defined by the applicable NASDAQ and SEC rules and regulations. In making its determination, the Board considered various transactions, relationships, or arrangements that relate to the Directors. The Board determined that the employment of Mr. McClellan’s son by SICA through January 16, 2009 did not affect Mr. McClellan’s independence under applicable NASDAQ and SEC rules and regulations. For a description of the transactions, relationships, or arrangements related to Messrs. Rue and McClellan, see the section entitled “Transactions with Related Persons” beginning on page 11.

In May 2007, Ms. Lamm-Tennant was appointed Global Chief Economist & Risk Strategist of Guy Carpenter, a subsidiary of Marsh & McLennan Companies, Inc. (“Marsh & McLennan”). The Board reviewed the material terms of the broker service agreement with Guy Carpenter under which the company’s insurance subsidiaries placed reinsurance through Guy Carpenter, for which Guy Carpenter earned approximately $1.38 million. Guy Carpenter’s total revenue for 2008 was approximately $803 million and, as such, the transactions with Selective companies were less than 0.2% of Guy Carpenter’s total revenue for the year. In February 2009, Ms. Lamm-Tennant was appointed Risk Strategist of Marsh & McLennan. Selective and its subsidiaries, from time to time, use the services of certain subsidiaries of Marsh & McLennan. In 2008, aggregate payments in connection with such services were less than $100,000. As Ms. Lamm-Tennant had no involvement in these transactions and the amount of the transactions is immaterial to the business of Marsh & McLennan, the Board determined that these transactions do not affect the independence of Ms. Lamm-Tennant under applicable NASDAQ and SEC rules and regulations.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), requires Selective’s directors and executive officers, and persons who own more than 10% of a registered class of Selective’s equity securities, to file with the SEC initial reports of ownership and reports of changes in ownership of Selective’s equity securities. Such executive officers, directors, and greater than 10% stockholders are required by SEC regulation to furnish Selective with copies of all of the Section 16(a) Exchange Act reports that they file. Other than as set forth above, based solely on its review of the copies of Forms 3, 4, and 5 or written representations from certain reporting persons that no Forms 5 were required for those persons, Selective believes that all reporting requirements under Section 16(a) for the fiscal year ended December 31, 2008, were met in a timely manner by its directors, executive officers, and greater than 10% beneficial owners.

CORPORATE GOVERNANCE

Corporate Governance Guidelines

Selective has established Corporate Governance Guidelines that are available for review in the Corporate Governance section of Selective’s website, www.selective.com. These guidelines provide for the election of a Lead Independent Director, who supervises meetings of Selective’s independent directors that occur at least semi-annually. Mr. Kearns is presently the Lead Independent Director. The Board intends to elect a new Lead Independent Director effective upon Mr. Kearns’ retirement. In 2008, Selective’s independent directors met four (4) times outside the presence of management.

All of the members of the Audit Committee, the Corporate Governance and Nominating Committee, and the Salary and Employee Benefits Committee are independent directors as defined by NASDAQ and SEC rules and regulations.

BOARD MEETINGS AND COMMITTEES

The Board of Directors held eight (8) meetings in 2008. All directors attended 75% or more of the meetings of the Board of Directors and the committees of which they were members in 2008. It is Selective’s policy that all directors are expected to attend the Annual Meeting, and all attended the 2008 Annual Meeting, except for former director John F. Rockart, who was absent due to illness.

The Board has five (5) standing committees:

	•		Audit Committee;
	•		Corporate Governance and Nominating Committee;
	•		Executive Committee;
	•		Finance Committee; and
	•		Salary and Employee Benefits Committee.

Audit Committee

The following table provides information on the composition and activities of the Audit Committee:

Corporate Governance and Nominating Committee

The following table provides information on the composition and activities of the Corporate Governance and Nominating Committee:

Nomination and Review of Director Candidates

The Corporate Governance and Nominating Committee reviews candidates for possible nomination and election to the Board of Directors from any source, including:

•

Directors and management;

•

Third party search firms that it may engage from time-to-time; and

•

Stockholders.

Regardless of source, the Corporate Governance and Nominating Committee evaluates all candidates on the same bases and standards, including:

•

Personal and professional ethics, integrity, character, and values;

•

Professional and personal experience;

•

Subject matter expertise;

•

Independence;

•

Diversity;

•

Business judgment;

•

Insurance industry knowledge;

•

Willingness to dedicate and devote sufficient time to Board duties and activities;

•

Potential or actual conflicts of interest; and

•

Other appropriate and relevant factors, including the qualification and skills of the current members of the Board.

Stockholders proposing candidates for consideration by the Corporate Governance and Nominating Committee must submit all information relating to such candidates as would be required to be disclosed in a solicitation of proxies for the election of such person as a director pursuant to Regulation 14A under the Exchange Act in writing as follows:

Chairman of the Corporate Governance and Nominating Committee
c/o Corporate Secretary of Selective Insurance Group, Inc.
40 Wantage Avenue
Branchville, NJ 07890

Executive Committee

The following table provides information on the composition and activities of the Executive Committee:

Finance Committee

The following table provides information on the composition and activities of the Finance Committee:

Salary and Employee Benefits Committee

The following table provides information on the composition and activities of the Salary and Employee Benefits Committee:

STOCKHOLDER COMMUNICATIONS

Stockholders so desiring may send communications to the Board of Directors or individual directors in writing c/o Corporate Secretary, Selective Insurance Group, Inc., 40 Wantage Avenue, Branchville, NJ 07890 or by e-mail to corporate.governance@selective.com. The Board has instructed the Corporate Secretary to use discretion in forwarding unsolicited advertisements, invitations to conferences, or other promotional material.

CODE OF CONDUCT

Selective has adopted a Code of Conduct which sets forth the guiding principles of business ethics for all Selective personnel, including executive officers. The Code of Conduct can be found under the Corporate Governance section of Selective’s website, www.selective.com. Any amendment to or waiver from the provisions of the Code of Conduct that applies to Selective’s senior executive officers will be posted to Selective’s website, www.selective.com.

EXECUTIVE COMPENSATION

Compensation Discussion and Analysis

Philosophy of our Executive Compensation Program

The Salary and Employee Benefits Committee (“SEBC”) of Selective’s Board of Directors oversees executive compensation. Selective seeks to attract and retain talented and qualified executives by paying compensation that is generally targeted at the 50^th percentile or greater of compensation paid by comparable companies in the property and casualty insurance industry. Our compensation programs are designed to motivate executives to achieve our corporate objectives and increase shareholder value. Accordingly, we tie our annual incentive awards to pre-determined strategic and financial business objectives and individual objectives, and we align our long-term compensation to the generation of long-term stockholder value over time.

The SEBC retains an outside executive compensation consultant (the “Compensation Consultant”) whose representative attends SEBC meetings as requested, reviews senior executive compensation, prepares comprehensive competitive compensation analyses for Selective’s named executive officers, and makes recommendations regarding the components of compensation, amounts allocated to those components, and the total compensation opportunities for the CEO and the other named executive officers. In April 2007, the SEBC engaged EXEQUITY, LLP (“EXEQUITY”) as the Compensation Consultant, and entered into an agreement with EXEQUITY. For 2008, amounts incurred for EXEQUITY’s executive compensation consulting services were $33,563.31.

Design Considerations of the Executive Compensation Program

Our executive compensation program consists of the following key elements:

	•		Base salary;
	•		Annual cash incentive payments;
	•		Long-term incentive awards in the form of stock options, performance-based restricted stock units, and performance-based cash incentive units; and
	•		Retirement and deferred compensation plans.

Each of the above elements was selected to respond to the market-based realities of attracting and retaining quality executives and to align executives’ efforts and results with the interests of Selective’s stockholders.

When making compensation decisions, the SEBC believes that it is important to be informed on compensation practices at publicly traded companies, in general, and property and casualty insurance holding companies, in particular. Accordingly, the Compensation Consultant performs an annual analysis of compensation paid to our named executive officers. This analysis compares base salary, annual cash incentives, total cash compensation, long-term incentives, and total compensation paid by Selective against various external benchmark groups. For our named executive officers other than our Chief Investment Officer and Chief Actuary, the Compensation Consultant utilizes the Market/Product Group, Size Group and the Property & Casualty Insurance Compensation Survey (the “PCICS”). For our Chief Investment Officer, market data is analyzed from both the PCICS and the McLagan Partners Investment Management Survey (the “McLagan Survey”), a recognized source for pay data for investment professionals. For our Chief Actuary, the Compensation Consultant utilizes the ClearSolutionsHR Salary Surveys (the “ClearSolutions Surveys”), which benchmarks Actuarial compensation nationwide. Compensation data for companies in these groups is obtained from filed proxy statements, as well as the PCICS, McLagan Survey and ClearSolutions Surveys. Additional information, including a listing of the companies in each of these benchmark groups and details regarding our benchmarking process is contained in the section entitled “Benchmarking.”

Tax Treatment and Accounting

To the extent practicable, the SEBC intends to preserve deductibility under the Internal Revenue Code for performance-based compensation paid to its executive officers. Section 162(m) of the Internal Revenue Code prohibits publicly owned companies from deducting compensation paid to certain of its executive officers as expense to the extent that the officer’s compensation in excess of $1 million is not performance-based, and is not paid pursuant to a stockholder approved plan. Selective has two performance-based stockholder approved plans: the Selective Insurance Group, Inc. 2005 Omnibus Stock Plan (the “Omnibus Stock Plan”) and the Selective Insurance Group, Inc. Cash Incentive Plan (the “Cash Incentive Plan”).

The Financial Accounting Standards Board (FASB) Statement of Financial Accounting Standards 123 (revised 2004), Share-Based Payment (“FAS 123R”), requires that compensation expense be measured on the income statement for all share-based payments (including employee stock options) at grant date fair value of the equity instruments. Selective adopted this accounting pronouncement on January 1, 2005.

Benchmarking

At least once a year, the SEBC compares the individual targeted compensation and actual paid compensation of our named executive officers with external data from groups of comparator companies. In 2008, EXEQUITY furnished the SEBC with information on the following benchmark groups, which contained 2007 and 2008 market data for named executive officer positions. The SEBC believes that these sources provide comprehensive information regarding Selective’s relative compensation position. By considering these multiple market references, the SEBC believes it can be less concerned about potential anomalies that may occur in a single market data point.

	•		Market/Product Group — organizations that compete with Selective in the sale of products and services;
	•		Size Group — companies of similar size;
	•		Property and Casualty Insurance Compensation Survey;
	•		McLagan Partners Investment Management Survey — Insurance Companies; and
	•		ClearSolutionsHR Actuarial Salary Surveys.

The companies that were included in each of these benchmark groups were as follows:

Market/Product Group		Size Group
The Chubb Corporation		Arch Capital Group, Ltd.
Cincinnati Financial Corporation		Commerce Group, Inc.
CNA Financial Corporation		Hanover Group
EMC Insurance Group Inc.		MaxCapital Group Ltd.
Hanover Group		Mercury General Corporation
Harleysville Group, Inc.		Ohio Casualty Corporation
Hartford Financial Services Group		Old Republic International Corporation
Ohio Casualty Corporation		Radian Group Inc.
PMA Capital Corporation		Unitrin, Inc.
Safeco Corporation		Zenith National Insurance Corp.
The Travelers Companies, Inc.
State Auto Financial Corporation

Property & Casualty Insurance Compensation Survey

ACE		Great American Insurance Group
Acuity		Hanover Group
Allstate Insurance Company		Harleysville Group, Inc.
American Family Insurance		Hartford Financial Services Group
American International Group		Liberty Mutual Group
Argonaut Group, Inc.		Main Street America Group
The Auto Club Group		Mercury General Corporation
Automobile Club of Southern California		MetLife
California State Automobile Association		Nationwide
Central Insurance Companies		Ohio Casualty Corporation
The Chubb Corporation		OneBeacon Insurance Group, Ltd
CNA Financial Corporation		PMA Capital Corporation
Country Insurance & Financial Services		Safeco Corporation
Crum & Forster		Sentry Insurance
Erie Indemnity Company		The Travelers Companies, Inc.
Farmers Insurance Group		State Farm Insurance Company
FBL Financial Group, Inc.		USAA
Fireman’s Fund Insurance Company		Utica National Insurance Group
GEICO		Winterthur North America
GE Insurance		Zenith National Insurance Corp.
		Zurich North America

McLagan Partners Investment Management Survey — Insurance Companies

40/86 Advisors, Inc		Mutual of Omaha
Advantus Capital Management, Inc		Nationwide Insurance
AEGON USA		New York Life Investment Management LLC
Aetna, Inc.		Northwestern Mutual Life Insurance Company
AIG Global Investment Group		OneAmerica Financial Partners
Allianz Life Insurance of North America		Opus Investment Management (Hanover Ins)
Allianz of America, Inc.		Pacific Life Insurance Company
Allstate Investments, LLC		PartnerRe Asset Management Company
Assurant, Inc		PPM America, Inc.
AVIVA USA (formerly AmerUs)		Principal Global Investors
AXA Equitable		Progressive Corporation
The Chubb Corporation		Prudential Financial
CIGNA Investment Management		Security Benefit Corporation
Country Insurance & Financial Services		Sentinel Asset Management, Inc.
CUNA Mutual Group		Sentry Insurance
FBL Financial Group		Standard Life Investments (USA) Limited
Fort Washington Investment Advisors, Inc.		State Farm Insurance Companies
Genworth Financial		Sun Life Financial
Guardian Life Insurance Company		Swiss Re
Hartford Investment Management Company		Thrivent Financial for Lutherans
ING Investment Management		TIAA-CREF
Liberty Mutual Group		The Travelers Companies, Inc.
MBIA Asset Management		USAA Investment Management Company
MEAG New York Corporation (Munich RE)
MetLife Investments
MFC Global Investment Management
Mutual of Omaha
Modern Woodmen of America

ClearSolutionsHR Actuarial Salary Surveys

ACE INA		Harleysville Insurance
Acuity		The Hartford
Aipso		Insurance Services Office
Allstate Corporation		Liberty Mutual Group
American Family Insurance		The Main Street America Group
American International Group		Mercury Insurance Group
Argonaut Group, Inc.		MetLife Auto and Homeowners Insurance
Assurant Solutions		Michigan Education Employees Mutual
Automobile Club Group/AAA Michigan		Insurance Company
Automobile Club of Southern California		Munich Reinsurance America, Inc.
California Casualty Management		Nationwide Insurance
Association		NCCI Holdings, Inc.
California State Automobile Association		Ohio Casualty Corporation
The Chubb Corporation		Pennsylvania National Mutual Casualty
CNA		Insurance Company
Crum & Forster/US Fire Insurance		PMA Insurance Group
CUNA Mutual Group		Safeco Corporation
Employers Mutual Casualty Company		Selective Insurance Company of America
Erie Insurance Group		State Farm Insurance Companies
Farmer’s Insurance		Swiss Reinsurance Company
FBL Financial Group, Inc.		Towers-Perrin
Fireman’s Fund Insurance Company		Traveler
GEICO		United Services Automobile Association
GMAC Motors Insurance Corporation		White Mountains Reinsurance Services
GM Insurance Management Corporation		Winterhur U.S. Holdings
GM Reinsurance Corporation		XL Capital
Great American Insurance Company		Zurich North America
The Hanover Insurance Group

For named executive officers other than the CEO, the SEBC takes into account the recommendations made by the CEO based on his assessment of each named executive officer’s performance for the year, continued contributions to the company, and potential for advancement. The SEBC gives the CEO’s recommendations significant weight in the evaluation process, but final decisions on named executive officer compensation are made by the SEBC. The SEBC also considers the medians of the benchmark groups in addition to pre-established guidelines regarding award amounts, company performance, retention issues, internal compensation parity, advancement in abilities, experience, and responsibilities.

Allocation Between Current and Long-Term Compensation

Selective allocates compensation between currently paid components, principally comprised of an established base salary and a variable annual cash incentive, and variable long-term components that link compensation opportunities for executives to both short-term and long-term financial and strategic objectives.

Elements of Current Compensation

Base Salary

Selective’s base salary provides stable, competitive compensation and takes into account scope of responsibility, relevant background, training, and experience. The SEBC also considers competitive market data for similar positions and overall market demand for each position. Generally, the SEBC believes base salaries should be aligned with market trends for executives in similar positions and with similar responsibilities at comparable companies. When establishing the 2008 base salaries of the named executive officers, the SEBC considered a number of additional factors, including:

	•		the functional role of the position;
	•		the level of responsibility;
	•		growth of the executive in the role, including skills and competencies;
	•		the contribution and performance of the executive; and
	•		the organization’s ability to replace the executive.

In light of the challenging property and casualty insurance business environment, the Company’s overall performance in 2008, and the competitive positioning of Mr. Murphy’s base salary, Mr. Murphy requested, and the SEBC agreed, for the third consecutive year, not to increase his base salary in 2009. For these same reasons, the base salaries of the other named executive officers were not increased for 2009, and will not again be considered for increase until the Company’s common salary review date in 2010.

In determining the 2008 base salary for Mr. Murphy, the SEBC considered the overall performance of the organization and Mr. Murphy’s individual performance, as well as base pay levels of CEOs in the benchmark groups. This comparison showed that Mr. Murphy’s base salary remained higher than the medians of the Market/Product Group and Size Group, but more closely aligned with the median of the PCICS group. Consequently, the SEBC concluded that Mr. Murphy’s base salary was appropriately positioned when compared with competitive norms and no salary increase was provided to him in 2008.

In determining the 2008 base salaries for the other named executive officers, based on their contributions to Selective’s growth, reviews of their comprehensive performance appraisals by Mr. Murphy, the potential for voluntary departures and cost and difficulty of replacement, the SEBC approved increases in the 2008 annual base salary rates for Mr. Thatcher from $415,000 to $475,000; Mr. Guthrie from $400,000 to $425,000; and Mr. Zaleski from $390,000 to $400,000. These increases were made in the course of the normal annual performance and salary review process. As Mr. Connell received a salary increase in late 2007 in connection with his appointment as Chief Administrative Officer, no additional salary increase was provided to him in 2008.

Annual Cash Incentive Program

Selective’s annual cash incentive program (“ACIP”) is based on near-term strategic and financial organizational goals as well as pre-established individual goals and objectives, and is intended to link a meaningful portion of annual cash compensation to the achievement of these goals. For 2008, most of Selective’s executives, including the named executive officers, other than the Chief Investment Officer, whose compensation is described in detail below, were eligible to be considered for an annual cash incentive payment under the Cash Incentive Plan, which was approved at the 2005 Annual Meeting of Stockholders. Each year, the SEBC approves annual strategic and financial goals, which, if attained, result in the funding of an ACIP award pool. An individual’s ACIP is based on position grade level, achievement of various corporate strategic initiatives and a corporate financial measure established for the ACIP, and individual employee performance. For 2008, corporate goals for the ACIP applicable to participating executive officers, including the named executive officers other than the Chief Investment Officer, were based on the achievement of six equally weighted strategic initiatives, which could account for the funding of up to 36% of the ACIP award pool, and a range of statutory combined ratios from 96.0% to 100.8%, that could result in the funding of between 0% and 80% of the ACIP award pool. Statutory combined ratio is a measurement commonly used within the property and casualty insurance industry to measure underwriting profit or loss — a statutory combined ratio under 100% generally indicates that an insurance company is generating an underwriting profit and a statutory combined ratio over 100% generally indicates that an insurance company is generating an underwriting loss. If none of the ACIP goals were achieved, no ACIP would be paid.

The six (6) strategic initiatives for 2008 were as follows:

Agency Distribution

•

New agent appointments and revenue growth;

Targeted Premium Growth

•

Achievement of premium target in specified market segment;

Territorial Expansion

•

Complete efforts to achieve targeted expansion of company footprint;

Technology

•

Achieve targeted pricing goals established under predictive modeling underwriting process;

Safety Management

•

Achieve service and compliance goals; and

Claims

•

Achieve stated litigation management and workers compensation operational improvements.

Based on the attainment of a statutory combined ratio of 99.2% and the achievement of three of the six strategic initiatives, the 2008 ACIP award pool for the Company’s executive officers, including the named executive officers, other than the Chief Investment Officer, was established at 42% of the funding target.

The payment opportunities for the 2008 ACIP for the CEO and the other named executive officers (other than the Chief Investment Officer) were based on competitive market levels and set as a percentage of annual base salary relative to corresponding levels of performance against the program’s performance goals. The SEBC can exercise discretion to award incentives in amounts lower than the maximums outlined below or to award no incentives at all.

For 2008, Mr. Murphy’s ACIP payment was $650,000, or approximately 72%, of base salary, compared to $900,000, or 100%, of base salary paid to him for 2007; a decrease of approximately 28% compared to his ACIP payment for 2007. In evaluating Mr. Murphy’s performance for 2008, the SEBC used a comprehensive written performance appraisal which was completed by all non-executive members of Selective’s Board of Directors. As CEO, Mr. Murphy has ultimate responsibility for the achievement of the financial and strategic goals described above. As the company did not fully meet certain stated objectives and goals in 2008, the SEBC felt the reduction in Mr. Murphy’s ACIP payment was warranted and consistent with the company’s pay for performance philosophy.

For the balance of the named executive officers, other than the Chief Investment Officer, who participates in a separate Investment Department Compensation Program (“IDCP”) described below, 2008 annual cash incentive payments were determined by the SEBC based on overall company performance, certain strategic goals described above, the successful attainment of written departmental objectives, and individual performance, including the following:

Mr. Thatcher — In addition to his general management accountability as a member of the Executive Management Team, Mr. Thatcher has primary responsibility for all financial

matters, investor relations, tax (including capital loss tax planning strategies), and treasury activities. In concert with the Chief Investment Officer and his team, Mr. Thatcher developed and fully implemented an enhanced liquidity plan to effectively deal with the unprecedented economic conditions that the company faced in 2008. His thoughtful planning and timely response allowed the company to maintain a strong statutory surplus position. Mr. Thatcher was also instrumental in implementing positive changes to the company’s casualty excess loss reinsurance program. Finally, Mr. Thatcher was also actively engaged in the development of favorable tax strategies, a very targeted investor relations strategy and an integrated Enterprise Risk Management effort, including the implementation of a control self-assessment discipline across the company. As a result of Mr. Thatcher’s strong contributions and financial leadership to the organization as noted above, their relative impact on the organization, and the overall performance of the company, Mr. Thatcher’s 2008 ACIP payment was approximately 53% of base salary, in relation to his ACIP opportunity range of 0-150% of base salary. Mr. Thatcher’s 2008 ACIP payment was a reduction of approximately 17% from 2007, which is consistent with the company’s pay for performance philosophy given that the company did not meet certain stated objectives and goals in 2008.

Mr. Connell — In his role as Chief Administrative Officer, Mr. Connell is responsible for many integrated functions that support the achievement of company goals and objectives. Mr. Connell’s leadership and management of the control self-assessment process in the company’s Human Resources function during 2008 are noteworthy. The comprehensive nature of this activity and the process discipline Mr. Connell established was instrumental in the successful achievement of this effort. In the technology arena, the ability of the company to expand its footprint into the state of Tennessee on time and within budget is directly attributable to Mr. Connell’s management of the Company’s information technology resources. Mr. Connell improved the enterprise project management office, effectively drove strategy planning efforts, and successfully completed a series of Knowledge Management and automated processing milestones. As a result of Mr. Connell’s significant role in the continued development and support of Information Technology to support our “high-touch” business strategy as noted above, their relative impact on the organization, and the overall performance of the company, his 2008 ACIP payment was approximately 61% of base salary, in relation to his ACIP opportunity range of 0-175% of base salary. Mr. Connell’s 2008 cash payout is a reduction of approximately 21% from 2007, given that the company did not meet certain stated objectives and goals in 2008. This reduction is consistent with the company’s pay for performance philosophy.

Mr. Zaleski — Functioning as the organization’s Chief Actuary and chief planning/budgeting officer, Mr. Zaleski plays a key role in oversight of reserve adequacy, pricing actions, underwriting improvements, and claims initiatives. During 2008, Mr. Zaleski successfully changed the budgeting model to risk-state functionality. He plays a critical role in assessing reserve adequacy and his quarterly reserve reviews provided essential information to guide prudent business decisions. Mr. Zaleski also assumed the leadership and management of the predictive modeling efforts and successfully led the development of the first fully developed in-house model. He was instrumental in the roll out of the Tennessee expansion project. Mr. Zaleski’s efforts to provide comprehensive rate indications and various state filings are expected to improve the company’s underwriting results. Other noteworthy accomplishments for Mr. Zaleski include his efforts with personal lines pricing (including the launch of a homeowner By-Peril rating plan), and in catastrophic expense management. As a result of Mr. Zaleski’s key role in driving underwriting improvements and leadership of the company’s predictive modeling efforts as noted above, their relative impact on the organization, and the overall performance of the company, his 2008 ACIP payment was approximately 50% of base salary, in relation to his ACIP opportunity range of 0-150% of base salary. Mr. Zaleski’s 2008 ACIP payment is a reduction of approximately 27% from 2007, which is consistent with the company’s pay for performance philosophy given that the company did not meet certain stated objectives and goals in 2008.

The Chief Investment Officer’s annual cash incentive compensation is paid under the IDCP. The IDCP measures overall investment results against stated benchmarks for both fixed income and equity portfolio performance. For 2008, annual cash incentive payments to the Chief Investment Officer and other company investment professionals were calculated based on results achieved over one-year and three-year performance periods. The IDCP’s cash award is increased or decreased based on the company’s investment results compared to the stated benchmarks. A final investment factor (pool modifier) is calculated each year after investment results are calculated. The 2008 pool modifier was approximately 93%. Listed below are the 2008 investment program performance measures:

Equity — Achieve portfolio performance as compared with the S&P 500 Index; and

Fixed Income — Achieve portfolio performance as compared with the custom blended Lehman weighted average debt indices.

Mr. Guthrie — As Chief Investment Officer, Mr. Guthrie’s performance is measured against appropriate financial market indices for the IDCP’s one-year and three-year performance periods. The investment climate and environment during 2008 was unprecedented and Mr. Guthrie made a series of sound decisions, initiated prudent action and generated results exceeding benchmarks. He maintained the quality of the company’s portfolio, responded with thoughtful, well-reasoned action to mitigate yield or liquidity issues, and was instrumental in safeguarding the Company’s capital position. The equity component of the portfolio significantly outperformed the S&P 500 Index for the 9^th consecutive year and alternative investments also outperformed the S&P 500 Index, although fixed income fell well below benchmark comparators. Overall, our investment portfolio’s other-than-temporary impairment (“OTTI”) write downs for 2008 were limited to a modest rate of approximately 1.5% of invested assets. In addition, Mr. Guthrie’s results in managing interest rate risk and credit risk in the 2008 market are noteworthy. Mr. Guthrie’s leadership on investment tools and strategies better position the company to effectively manage its investment portfolio and risks. As a result of Mr. Guthrie’s role in generating investment results that exceeded benchmarks as noted above, their relative impact on the organization, and the overall performance of the investment portfolio against stated benchmarks, his 2008 ACIP payment was approximately 74% of base salary, in relation to his ACIP opportunity range of 0-197% of base salary. Mr. Guthrie’s 2008 ACIP payment is a reduction of approximately 34% from 2007, given that the company did not meet certain stated objectives and goals in 2008. This reduction is consistent with the company’s pay for performance philosophy.

Long-Term Incentive Program Award (“LTIP”) Funding

For each employee eligible to participate in our LTIP, including the named executive officers, a dollar denominated target award is established. To determine the amount of the total LTIP award pool, all individual target award amounts are aggregated.

Elements of Long-Term Compensation

Selective uses both cash and non-cash vehicles to deliver long-term compensation, which is consistent and competitive with the market practices of Selective’s benchmark insurance groups. This approach also takes into account Selective’s prior commitment made in its 2005 Proxy Statement to maintain a three-year average annual share utilization “burn-rate” of not greater than 2% for awards granted under the Omnibus Stock Plan, including awards to the named executive officers (“Burn-Rate Commitment”). The average share utilization burn-rate for the three-year period ended December 31, 2008 for grants under the Omnibus Stock Plan was 1.73%; within the prior Burn-Rate Commitment.

Selective views long-term compensation as a retention tool for Selective’s named executive officers, and as a vehicle to help focus these executives on long-term goals. By granting performance-based restricted stock units and performance-based cash incentive units with three-year performance

periods and options with three-year ratable vesting periods, Selective encourages executive officers to continue their tenure with Selective, while aligning their interests with those of our stockholders. In determining the amount of long-term compensation awards in 2008, the SEBC looked at several factors, including: (i) each individual executive’s performance during the previous year, including the achievement of department initiatives and other projects and endeavors accomplished throughout the year, as outlined above; (ii) each executive officer’s total compensation in comparison to benchmark data; and (iii) Selective’s desire to encourage long-term retention of high-performing executives. The SEBC compared Selective’s performance, including combined ratios, revenue growth, net premium written growth, and total shareholder return, to the performance of the companies in the benchmark insurance groups to help ensure that Selective’s executive officers are adequately and competitively compensated for the results they have achieved for Selective.

For certain executives, including the named executive officers, long-term compensation awards are allocated among three components: stock options, performance-based restricted stock units and performance-based cash incentive units.

Stock Options

Stock options are allocated to the CEO and other named executive officers as a portion of the monetized value of the executive’s long-term compensation award. As the value delivered by a stock option is dependent on the increase in value of the underlying shares, an award of this nature aligns the named executive officers’ interests with those of our stockholders. Options are awarded under the Omnibus Stock Plan at fair market value (the closing price of Selective’s common stock as quoted on NASDAQ on the date of grant) (“Fair Market Value”) and they vest ratably over three years, beginning on the first anniversary of the date of grant. The value of any executive’s stock option grant is limited to a Fair Market Value of $100,000 on date of grant, so that the grant may qualify for incentive stock option (“ISO”) tax treatment. Selective’s use of options has been generally lower than other financial services companies and is consistent with the Burn-Rate Commitment.

Performance-Based Restricted Stock Units

For 2008, sixty-five percent (65%) of the remaining monetized value of an executive’s long-term compensation is delivered in performance-based restricted stock units under the Omnibus Stock Plan. Performance-based restricted stock unit grants are generally subject to vesting based on time and attainment of certain performance measures that are set annually by the SEBC. The 2008 grants are subject to the following conditions:

	•		Three-year vesting period; and
	•		Achievement at any time during the vesting period of either: (i) a cumulative operating return on equity of fifteen percent (15%), computed by excluding from the determination of average equity any unrealized gain occurring after December 31, 2007, or (ii) a five percent (5%) cumulative growth in net premiums written.

Dividend equivalent units (“DEUs”) are credited on performance-based restricted stock units at the same dividend rate paid to all Selective stockholders. Payment of DEUs remains subject to the same vesting conditions performance measures applicable to the underlying restricted stock units. This use of restricted stock units clearly aligns this component of executives’ compensation with overall corporate performance and stockholder interests.

Performance-Based Cash Incentive Units

The remaining thirty-five percent (35%) of the monetized value of an executive’s long-term compensation is delivered through cash incentive units granted under the Cash Incentive Plan. Grants made in 2008 are subject to the following terms:

	•		Three-year performance period;
	•		The value of each cash incentive unit initially awarded increases or decreases to reflect total shareholder return on Selective common stock over the three-year performance period for the award; and
	•		The number of cash incentive units ultimately earned increases or decreases based on: (i) cumulative three-year statutory net premium written growth relative to a peer index, and (ii) cumulative three-year statutory combined ratio relative to a peer index. Awards are earned at target level if these performance measures are between the 45th and 54.9th percentile of the peer group. If both measures are at or above the 80th percentile, 200% of the units initially awarded are earned. If both measures are below the 35th percentile, none of the units initially awarded are earned.

The group (the “Cash Incentive Unit Peer Group”) established for comparing Selective’s performance for the purposes of determining the ultimate number of performance-based cash incentive units awarded consists of the following companies:

Auto-Owners Insurance Group		CNA Group LLC
Liberty Mutual Group Inc.		The Travelers Companies, Inc.
Hartford Fire Group		Harleysville Group Inc.
Safeco Insurance Company of America		Utica National Insurance Group
Erie Insurance Exchange		Hanover Insurance Group, Inc.
Cincinnati Financial Corporation		W. R. Berkley Corporation
OneBeacon Insurance Group, Ltd

Use of the cash incentive units in lieu of stock options or restricted stock units conserves share usage consistent with the Burn-Rate Commitment. Since the cash incentive unit grants take into account Selective’s three-year performance relative to its peer group and total shareholder return on its common stock, this award is also directly linked to company performance and the interests of stockholders.

Timing of Awards

Generally, stock option, restricted stock unit, and cash incentive unit awards are granted each year in connection with the SEBC’s regularly scheduled first quarter meeting. It was at this time, at their respective meetings, that the SEBC and the Board of Directors reviewed final year-end results for the prior year and the SEBC made final determinations on compensation.

Stock Ownership Requirements

Selective believes that stock ownership by directors and management encourages the enhancement of stockholder value and, accordingly, adopted, effective January 31, 2008, the following common stock ownership guidelines for Directors and certain officers as part of its Corporate Governance Guidelines posted on Selective’s website at www.selective.com:

•

Each director shall, within five (5) years of his or her first election to the Board, beneficially own at least four (4) times the cash value of his or her annual retainer in shares of Selective common stock. Shares of Selective common stock currently owned, awards of restricted stock or restricted stock units not yet vested and shares of Selective common stock held in benefit plan investments (i.e., 401(k) Plan) are considered in determining such ownership. Unexercised stock options are not counted in calculating ownership. Deferred stock units held in the accounts of directors under the Deferred Compensation Plan for directors are counted in calculating ownership.

•

The current requirements for certain officers of Selective are as follows:

Chairman, President & CEO		4 x base salary
Senior Executive Vice Presidents and Executive Vice Presidents		2.5 x base salary
Senior Vice Presidents		1.5 x base salary

The above stock ownership requirements for officers must be met no later than December 31, 2013, or within five (5) years from the attainment of the above officer status, whichever is later. Base salary increases during the five (5) year period will require the ultimate ownership requirements to increase when shares are valued on the December 31 following such increase. Shares of Selective common stock currently owned, awards of restricted stock or restricted stock units not yet vested and shares of Selective common stock held in benefit plan investments (i.e., 401(k) Plan) are considered in determining such ownership. Unexercised stock options are not counted in calculating stock ownership.

Role of Executive Officers in Determining Compensation

The SEBC makes all final determinations with respect to executive officers’ compensation, primarily based on information provided by its Compensation Consultant. Selective’s CEO does make recommendations to the SEBC relating to the compensation of executive officers who directly report to him, but the SEBC has full autonomy in determining executive compensation. As part of their responsibilities, the Executive Vice President of Human Resources and certain other human resources officers provide information to the SEBC regarding the overall design of the executive compensation program and its individual components.

Retirement and Deferred Compensation Plans

Selective’s wholly-owned lead insurance subsidiary, Selective Insurance Company of America (“SICA”), employs the personnel engaged in Selective’s insurance operations, including all the named executive officers. SICA maintains a non-contributory defined benefit pension program consisting of a tax qualified defined benefit pension plan (the “Retirement Income Plan”) and a supplemental employee retirement plan and maintains health and welfare benefit plans in which eligible employees, including the named executive officers, participate. The pension program is more fully described in the section entitled “Pension Benefits” beginning on page 35.

SICA offers a tax qualified defined contribution plan (the “Retirement Savings Plan”) to employees, including the named executive officers, who meet eligibility requirements. Participants, other than highly compensated employees as defined by the Internal Revenue Service, can contribute 50% of their defined compensation to the Retirement Savings Plan, up to $15,500 in 2008. Highly compensated employees are limited to 8% of their defined compensation, up to $15,500 in 2008. Contributions by participants of up to a maximum of 7% of defined compensation are matched 65% by SICA. Participants over the age of 50, including certain of the named executive officers, may make an additional $5,000 catch-up contribution to the Retirement Savings Plan, pursuant to the Internal Revenue Code, which contribution is not eligible for a company match. Effective January 1, 2006, the Retirement Savings Plan was amended to include additional enhanced matching contributions and non-elective contributions for otherwise eligible employees who, because of a date of hire after December 31, 2005, are not eligible to participate in the Retirement Income Plan. None of the named executive officers are eligible for the enhanced matching or the additional non-elective contributions.

Under SICA’s Deferred Compensation Plan, executives, including the named executive officers, may defer up to 50% of their base salary and/or up to 100% of their ACIP. To the extent not matched in the Retirement Savings Plan due to limitations under the Internal Revenue Code, contributions to the Deferred Compensation Plan by participants of up to 7% of base salary are matched 65% by SICA. Additional information regarding the deferred compensation is included under “Nonqualified Deferred Compensation” beginning on page 35.

Employment Agreements

Selective has entered into employment agreements containing change in control provisions. The employment agreements are described under “Employment Agreements and Potential Payments Upon Termination or Change of Control” beginning on page 37.

Summary Compensation Table

     The following Summary Compensation Table reflects the compensation earned by or paid to the named executive officers.

																						Change in
																		Non-Equity				Pension Value
																		Incentive				and Nonqualified
Name										Stock				Option				Plan				Deferred				All Other
And						Salary				Awards				Awards				Compensation				Compensation				Compensation				Total
Principal Position		Year				($)(1)				($)(2)				($)(3)				($)(4)				Earnings ($)(5)				($)(6)				($)
Gregory E. Murphy			2008				900,000				1,708,294				23,139				650,000				459,931				42,150				3,783,514
Chairman, President and Chief			2007				900,000				1,876,425				25,633				900,000				85,449				40,989				3,828,496
Executive Officer			2006				876,923				2,460,513				28,066				1,500,000				158,637				42,900				5,067,039
Dale A. Thatcher			2008				465,769				164,747				12,662				250,000				43,062				21,193				957,433
Executive Vice			2007				405,000				207,953				15,664				300,000				13,696				18,428				960,741
President, Chief			2006				342,308				242,166				17,152				420,000				14,245				17,075				1,052,946
Financial Officer and Treasurer
Richard F. Connell			2008				450,000				597,923				23,139				275,000				96,035				21,491				1,463,588
Senior Executive			2007				411,538				561,175				24,318				350,000				49,037				19,250				1,415,318
Vice President and			2006				375,385				327,237				18,351				485,000				44,406				17,755				1,268,134
Chief Administrative Officer
Kerry A. Guthrie			2008				421,154				543,683				23,139				325,000				151,006				19,279				1,483,261
Executive Vice			2007				392,615				607,940				25,633				495,000				49,640				20,762				1,591,590
President and Chief			2006				347,077				338,280				20,047				400,000				59,761				18,263				1,183,428
Investment Officer
Ronald J. Zaleski			2008				395,385				218,379				14,470				200,000				54,649				17,990				900,873
Executive Vice			2007				367,385				183,074				15,746				275,021				19,157				21,869				882,252
President and Chief			2006				349,923				219,045				17,152				390,000				22,178				21,162				1,019,460
Actuary

	•		Mr. Murphy: $33,075 of company matching contributions to Mr. Murphy’s Deferred Compensation Plan, $3,000 for tax preparation services, and $6,825 of company matching contributions to Mr. Murphy’s 401(k) plan.
	•		Mr. Thatcher: $13,312 of company matching contributions to Mr. Thatcher’s Deferred Compensation Plan, $1,500 for tax preparation services, and $2,263 of company matching contributions to Mr. Thatcher’s 401(k) plan.
	•		Mr. Connell: $7,330 of company matching contributions to Mr. Connell’s Deferred Compensation Plan, $675 for tax preparation services, and $9,750 of company matching contributions to Mr. Connell’s 401(k) plan.
	•		Mr. Guthrie: $12,936 of company matching contributions to Mr. Guthrie’s Deferred Compensation Plan, $1,660 for tax preparation services, $2,937 of company matching contributions to Mr. Guthrie’s 401(k) plan, and $730 representing the difference between the market rate of interest and the actual rate of interest on indebtedness to the company.
	•		Mr. Zaleski: $10,237 of company matching contributions to Mr. Zaleski’s Deferred Compensation Plan, $1,175 for tax preparation services, and $9,750 of company matching contributions to Mr. Zaleski’s 401(k) plan.

        For 2007, amounts in this column for each named executive officer reflect the following:

	•		Mr. Murphy: $30,875 of company matching contributions to Mr. Murphy’s Deferred Compensation Plan, and $10,114 of company matching contributions to Mr. Murphy’s 401(k) plan.
	•		Mr. Thatcher: $15,569 of company matching contributions to Mr. Thatcher’s Deferred Compensation Plan, and $2,859 of company matching contributions to Mr. Thatcher’s 401(k) plan.
	•		Mr. Connell: $8,650 of company matching contributions to Mr. Connell’s Deferred Compensation Plan, $525 for tax preparation services, and $10,075 of company matching contributions to Mr. Connell’s 401(k) plan.
	•		Mr. Guthrie: $14,790 of company matching contributions to Mr. Guthrie’s Deferred Compensation Plan, $2,280 for tax preparation services, $3,075 of company matching contributions to Mr. Guthrie’s 401(k) plan, and $617 representing the difference between the market rate of interest and the actual rate of interest on indebtedness to the company.
	•		Mr. Zaleski: $16,716 of company matching contributions to Mr. Zaleski’s Deferred Compensation Plan, $1,415 for tax preparation services, and $3,738 of company matching contributions to Mr. Zaleski’s 401(k) plan.

        For 2008, amounts in this column for each named executive officer reflect the following:

	•		Mr. Murphy: $30,875 of company matching contributions to Mr. Murphy’s Deferred Compensation Plan, $1,200 for tax preparation services, and $10,075 of company matching contributions to Mr. Murphy’s 401(k) plan.
	•		Mr. Thatcher: $11,118 of company matching contributions to Mr. Thatcher’s Deferred Compensation Plan, and $10,075 of company matching contributions to Mr. Thatcher’s 401(k) plan.
	•		Mr. Connell: $10,400 of company matching contributions to Mr. Connell’s Deferred Compensation Plan, $1,016 for tax preparation services, and $10,075 of company matching contributions to Mr. Connell’s 401(k) plan.
	•		Mr. Guthrie: $7,762 of company matching contributions to Mr. Guthrie’s Deferred Compensation Plan, $938 for tax preparation services, $10,075 of company matching contributions to Mr. Guthrie’s 401(k) plan, and $504 representing the difference between the market rate of interest and the actual rate of interest on indebtedness to the company.
	•		Mr. Zaleski: $7,915 of company matching contributions to Mr. Zaleski’s Deferred Compensation Plan, and $10,075 of company matching contributions to Mr. Zaleski’s 401(k) plan.

Grants of Plan Based Awards

     The following table shows the grants of plan based awards to our named executive officers in 2008:

																																																	Grant Date
																																																	Fair Value
																			Estimated Future Payouts Under Equity																				All Other										of Cash
																			Incentive Plan Awards(2)																				Option										Incentive
																																		Re-					Awards:					Exercise					Unit,
									Estimated Future																									stricted					Number of					or Base					Restricted
									Payouts Under Non-																									Stock					Securities					Price of					Stock, and
									Equity Incentive Plan																									Awards					Underlying					Option					Option
									Awards(1)										Cash Incentive Unit Awards(3)															(#)					Options					Awards					Awards(4)
	Name			Grant Date					Minimum($)					Maximum ($)					Threshold (#)					Target (#)					Maximum (#)					Maximum (#)					(#)					($/Sh)					($)
	Gregory E. Murphy				2/6/2008				$	0				$	1,800,000					2,760					5,520					11,040					42,583					4,154				$	24.07				$	1,600,111
	Dale A. Thatcher				2/6/2008				$	0				$	712,500					923					1,845					3,690					14,228					4,154				$	24.07				$	550,106
	Richard F. Connell				2/6/2008				$	0				$	787,500					966					1,932					3,864					14,903					4,154				$	24.07				$	575,053
	Kerry A. Guthrie				2/6/2008				$	0				$	797,160					879					1,757					3,514					13,553					4,154				$	24.07				$	525,059
	Ronald J. Zaleski				2/6/2008				$	0				$	600,000					748					1,495					2,990					11,528					4,154				$	24.07				$	450,117

Outstanding Equity Awards at Fiscal Year End

     The following table shows the unexercised options and unvested stock awards to our named executive officers as of December 31, 2008: