Original Source: FD (FAIR DISCLOSURE) WIRE
MATT HEIMERMANN, ANALYST, J.P. MORGAN: All right. Well welcome, everyone. I guess we've had a little bit of a death march this morning with respect to the schedule and I appreciate all of you still hanging with us, as we've had quite a few presentations. It's my pleasure to introduce Neal Fuller, who is SVP and Treasurer at Safeco.
He's been at the Company for many years, very active, not only in the financials of the Company, but also running IR and I think one of the more well-respected IR heads on the street, especially within the insurance industry and a joy to work with. And he's been kind enough to fly out all the way from the west coast to join us today and talk a little bit more about Safeco. And with that, I'll turn it over to Neal.
NEAL FULLER, SVP AND TREASURER, SAFECO CORPORATION: Thank you very much, everyone. It's a pleasure to be here and I appreciate your time. I just want to take you through Safeco a little bit. We've got some additional slides and disclosures on our investment portfolio, some of the things that you might be focused on as both bond investors and equity investors as well. As Matt said, I've been active at Safeco for many years. I've been there about 20 years, about seven years as Vice President of Finance, now SVP and Treasurer.
So obviously, today, I'll be making forward-looking statements. Here's all the things that you should be thinking about when you consider those forward-looking statements that I might make today. Safeco is Seattle based. It's been in business since 1924, primarily writing in the west, northwest and the Midwest, but we are a national company. We are one of the premier independent agency writers.
We write primarily through the independent agents. You can see some of the details here on this slide. Fifth largest independent agent writer of auto and home, a top ten small commercial insurer. Probably the key thing to take away from this slide is obviously the distribution of our premium with auto, personal lines, property and small commercial being the bulk of it. We also have a surety operation, the fourth largest in the country.
The common thing about all of these and our essential element to our strategy is that these are all short-tail lines of business. This is not DNO, this is not medical malpractice, this is not esoteric risk. These are the risks that Safeco understands and has always understood very well. So these are also the primary lines that independent agents sell and we sell these through an automated platform, a browser-based platform called Safeco Now.
It has all of the lines on one system. There's no toggling back and forth between screens to be able to do that. And that ease of doing business is something that agents applaud us for when they think about how they need to handle these accounts in a very efficient manner, because the commission on an average auto account is not going to make or break them. They need to be able to handle it.
Profitability has always been part of Safeco's underwriting culture, the focus on profit, not on cash flow underwriting, three-year average ROE and combined ratio of 19%. You can see some of the other details on the slide here. Our balance sheet is very strong. We have a 13% debt-to-capital ratio right now. No exposure to the esoteric securities that have been out there in the news -- sub-prime, CDOs, CLOs, all of those types of things.
And strong underwriting culture. You can see 23 years out of the past 26 years, we outperformed the industry in terms of our results. We sell through 9,000 independent agents, as I mentioned before, and consistently have had very, very strong catastrophe management, and not just in practice, but in the results. When you start to look at our results, I'll show you a slide later, you can see that we not only talk about catastrophe management, but we actually do it.
Our three -- lines of business really are auto, home, small commercial, as I mentioned before and not only that. These are not the lines of business where we're writing non-standard risks to integrate deal. These are highly preferred customers, typically with very good credit quality. We've used automated multi-variant underwriting for many years, starting in 2001 with auto and 2002 with our home, and that helps us as we think about going into an economic uncertain time here in the United States. It's better to have a preferred book of business where the customers have good credit quality. They're going to continue to pay their insurance premiums, they're less likely to have claims and less likely to have volatility in their results.
More details here in terms of our strong financial performance over the last several years -- revenues, combined ratio, return on equity, earnings per share, all have been very, very strong. We try to be as transparent as possible and these are some of the goals that we set in 2007, performing for our owners, building continuous improvement, working for the customer and building tools for the future. Obviously, the more important metrics for you, as a financial analyst, is the performing for our owners. And you can see there again, very strong ROE and operating ROE, a 91.4% overall combined ratio, a 1.2% growth in net written premium and a growth in policies in force as well.
Not only that, this year, we raised the dividend by 33%, we bought back a billion dollars worth of stock and we bought back over $550 million worth of debt. So really trying to manage our capital in an efficient manner as we get to that part in the insurance cycle when there's not a lot of growth opportunity. The other things I won't go through here. I'll let you read through them. They're more soft, but they are important and essential for the business. And you can see the impact of the dividends and what we've done over the last several years. The dividend increases, you can see on this slide, 33% last year.
Last year, again, $1 billion in stock bought back. You can also see the impact on the return on equity. As you think about valuation for property and casualty insurers, you typically look at ROE and you look at the price-to-book ratio. Needing to maintain that high, strong ROE for investors, we have bought back a lot of stock. If we had not done that, you could see our ROE last year would've been about 12.5%, about four points down from …