Erie Indemnity Company

Good morning and welcome to the Erie Indemnity Company second quarter 2020 earnings conference call. This call was pre-recorded and there will be no question and answer session following the recording. Now I'd like to introduce your host for the call, Vice President of Investor Relations, Scott Beilharz. You may proceed.

Thank you and welcome everyone. We appreciate you joining us for the recorded discussion about our 2020 second quarter results. This recording will include remarks from Tim NeCastro, President and Chief Executive Officer, and Greg Gutting, Executive Vice President and Chief Financial Officer. Our earnings release and financial supplement were issued yesterday afternoon after the market closed and are available within the investor relations section of our website, beerinsurance.com. Before we begin, I would like to remind everyone that today's discussion may contain forward-looking remarks They reflect the company's current views about future events. These remarks are based on assumptions subject to known and unexpected risks and uncertainties. These risks and uncertainties may cause results to differ materially from those described in these remarks. For information on important factors that may cause these differences, please see the Safe Harbor Statements in our Form 10-Q filing with the SEC, dated July 30, 2020, and in the related press release. This pre-recorded call is the property of your Indemnity Company. It may not be reproduced or rebroadcast by any other party without the prior written consent of your Indemnity Company. With that, we will move on to Tim's remarks.

Thanks, Scott. And thank you, everyone, for your time today and your interest in your second quarter results. Before we talk about our quarterly financials, I want to touch on a couple of topics that are certainly top of mind for us as a business and, more importantly, as people. First, the pandemic. As the coronavirus has spread and states have opened up quickly, all of us here remain grateful to the health care professionals and essential workers who deliver every day with great courage and caring. Some of the actions we've taken regarding remote work have been taken to protect our employees and help stem the spread of the disease and its impact on the health care system in our communities. While the majority of our 6,000 employees continue to work remotely, we have a few hundred essential workers who remain on site throughout our 12-stage footprint. These are the employees maintaining our network and data systems, facilities, and construction teams, and handling cash processing and other critical functions that can only be performed on site. Together with more than 13,000 Erie licensed agents, our employees, wherever they're working, are consistently delivering on Erie's promise of service throughout these trying times. As I shared with you in May, our support for customers includes $400 million in financial relief for our personal and commercial automobile customers This included $200 million in policyholder dividends and an overall 5% rate reduction for those policies. We mailed 2.5 million dividend checks and heard from more than 1,400 customers who responded with reading cards, letters, and emails thanking Erie and our agents. Most noted that checks, which averaged about $75, made a meaningful difference from helping with the weekly grocery bill to affirming their decision to do business with Erie. I wanted to share one comment from a customer in Wisconsin. Not only did the dividend check bring a smile to my face, it was like a ray of sunshine. That may seem flowery, she wrote, but with all that's going on in our country, it made my day brighter. That customer also told us that she donated her dividend to a local food pantry to help her neighbors hit especially hard by the pandemic and financial crisis. She was actually one of many customers who said they would pay it forward and donate their dividend to the pandemic relief efforts. Our agents have stepped up in big ways, too. With more than $2 million in community relief funding from Erie bolstering their efforts, our agents helped feed frontline workers and first responders, supported local businesses, and gave money to charities in need. This important work was reflected in nearly 2,000 stories they share on social media. Our employees and agents all share a deep belief in service, in caring, and in doing the right thing, both in our community and the work we do every day as we grow our business and serve our customers. Before we move into the financials, I want to address the dialogue that is occurring across our country and within our communities around race and racism. It's a conversation that's happening here as well with employees across the organization as we broaden perspectives and create positive change in our workplace and in our communities. It's a conversation we are committed to continuing. At Erie, we do not tolerate racism or other forms of discrimination of any kind within our employee or agency force. We believe in and promote an environment of mutual respect. Put simply, we believe in the Golden Rule, and we strive to treat all people with dignity and respect each of us deserves. Thank you. It's important to me that you know where we stand. Let's move on to the second quarter and make your financial results. As you saw in our press release filed July 30th, Erie Indemnity reported net income of $82 million, or $1.57 per diluted share for the second quarter. Like the rest of the property casualty industry, our second quarter results reflected the combined impact of the COVID-19 pandemic and the related financial crisis. I am confident in our response, in our support of agents and customers, and in our ability to continue to grow, albeit at a slower pace, as we adapt to the current normal. Our production is continuing to rebound. As our agents, with the help from our sales team, have adjusted to this new way of working and are once again focused on growth. Losses remain below normal levels, stemming from a relatively mild spring across our territory and an industry-wide reduction in miles driven. And overall, our financial position remains extremely solid despite the tumultuous year our country and our world has experienced. I'll talk more about our progress on key initiatives in a few minutes after Greg provides a deeper review of our financials. Greg? Thanks, Tim.