Erie Indemnity Company

Good morning, and welcome to the Erie Indemnity Company Third Quarter 2020 Earnings Conference Call. This call was prerecorded, and there will be no question and answer session following the recording. Now, I'd like to introduce your host for this call, Vice President of Investor Relations, Scott Bowhars.

Thank you, and welcome, everyone. We appreciate you joining us for this recorded discussion about our 2020 Third Quarter results. This recording will include remarks from Tim DeCastro, 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 that 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 FCC dated October 29, 2020, and in the related press release. This prerecorded 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 move on to Tim's remarks.

Thanks, Scott. And thanks to all of you for taking the time to learn more about Erie's performance in the third quarter of 2020. It's hard to believe it's been more than seven months since COVID-19 changed the way we live and work. All of us at Erie remain grateful to those keeping our health care system and economy in good standing by providing essential services, and more recently to the teachers who are navigating this new and challenging territory, both virtually and in the classroom. They're all very deserving of our appreciation and our respect. Here at Erie, more than 95% of our workforce continues to work from home, both for their protection and that of the employees who continue to report to our offices to perform essential duties across our 12-state footprint. I'm proud to echo something I mentioned last quarter. Even with this new way of working, our productivity is not wavered. I'm continually impressed with how well our nearly 6,000 employees and 13,000 licensed Erie agents have been able to adapt to new challenges and demands presented by the pandemic, while continuing to focus on production, innovation, and of course, delivering our trademark service. And while some of our competitors have announced significant workforce reductions over the past few months, We've been able to maintain our 95-year track record of security and stability for our employees through proactive cross-training in areas like underwriting and customer care. Along with our employees, our agents have also been able to maintain profitable growth and production while adapting to a new way of working. That is evident in our premium growth, which continues to outpace the overall industry, as you'll learn more about in a few minutes. We're facing a very competitive environment. If the demand for digital capabilities was high before the pandemic, now it's reached a fever pitch. Even those who aren't necessarily comfortable with digital tools are now using them out of necessity, and all carriers are working to hone their virtual capabilities. While the pandemic has brought digital to the forefront, it also placed a renewed importance on something that can't be found behind the screen, and that's the human touch. In the absence of it, that human touch has become even more powerful. And along with our employees who embrace our service promise every day, the people who are delivering the human touch to our customers are the independent agents who represent Erie in their local communities. They offer something that many carriers lack but customers crave. Our agents and the dedication they had to Erie is the number one thing that sets us apart from our competition. Let's move on to our third quarter financial results. As you saw in our press release filed after the market closed yesterday, Erie Indemnity reported net income of $89 million, or $1.71 per diluted share for the quarter. As I noted earlier, despite the competitive and challenging environment we face this year, we are outpacing the industry in premium growth. While Conning has forecasted industry premium growth of 0.3% for 2020, we currently stand at 2% for the year. Once again, This is a testament to the hard work and agility of our sales team and agency force, who remained focused on profitable growth and retention over the past several months. On the claims side, losses remain below normal levels. This stems from a relatively uneventful summer in terms of weather events across our territory, as well as an industry-wide reduction in miles driven. Overall, our financial position remains solid despite the unprecedented year of change we're experiencing nationally and globally. I'll talk more about progress on some key products and initiatives in a few minutes after Greg's review of the financials. Greg? Thanks, Tim.