UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): December 23, 2002
ERIE INDEMNITY COMPANY
(Exact name of registrant as specified in its charter)
PENNSYLVANIA 0-24000 25-0466020
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(State or other jurisdiction of (Commission (I.R.S. Employer
incorporation) File Number) Identification No.)
100 Erie Insurance Place, Erie, Pennsylvania 16530
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (814) 870-2000
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Item 5. OTHER EVENTS.
On December 23, 2002, Erie Indemnity Company issued a press release which is
filed as Exhibit 99.1 hereto and is incorporated herein by reference.
Item 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
Exhibit Number Description
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99.1 Press release dated December 23, 2002
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
ERIE INDEMNITY COMPANY
Erie Indemnity Company
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(Registrant)
Date: December 23, 2002 /s/ Jan R. Van Gorder
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(Jan R. Van Gorder, Senior Executive Vice
President, Secretary and General Counsel)
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EXHIBIT 99.1
ERIE INSURANCE REPORTS LOSS RESERVE INCREASES AND LOSSES FROM RECENT STORMS
ERIE, Pa. - December 23, 2002 - Erie Insurance Group announced today that its
property and casualty companies would increase loss and loss adjustment expense
reserves by approximately $184 million in the fourth quarter of 2002. The
company also reported its expected losses due to recent storms.
The reserve increases, all related to the Group's direct business, are being
taken in response to loss experience in the Group's auto, homeowners and
workers' compensation lines of business. Increased loss severity, particularly
in automobile bodily injury and catastrophic medical claims in the workers'
compensation line, is the primary driver of these increased reserve indications.
The reserve increases will result in after-tax charges to Erie Indemnity Company
of approximately $.03 to $.06 in the fourth quarter. These charges are a result
of the portion of this reserve increase that is attributable to the insurance
subsidiaries of Erie Indemnity Company. The charges take into effect recoveries
expected under an intercompany reinsurance agreement with Erie Insurance
Exchange.
Erie Insurance Group expects to incur more than 4,500 claims as a result of
damage caused by tornados and hail on November 10 and 11 and ice storms on
December 4 and 5, 2002. The November losses occurred primarily in Pennsylvania
and Ohio, while the December storms occurred primarily in North Carolina.
At this time, Erie Insurance Group estimates the combined exposure from claims
arising from these storms will result in incurred losses of approximately $21 to
$24 million, all in its direct insurance business. Erie Indemnity Company will
incur losses in its underwriting operations of $.01 per share after taxes due to
these storms in the fourth quarter.
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Erie Indemnity Company is the principal management company for the member
companies of the Erie Insurance Group, which includes the Erie Insurance
Exchange, Flagship City Insurance Company, Erie Insurance Company, Erie
Insurance Property and Casualty Company, Erie Insurance Company of New York and
Erie Family Life Insurance Company.
According to A.M. Best Company, Erie Insurance Group, based in Erie,
Pennsylvania, is the 17th largest automobile insurer in the United States based
on direct premiums written and the 25th largest property/casualty insurer in the
United States based on total lines net premium written. The Group, rated A++
(superior) by A.M. Best Company, has more than 3.4 million policies in force and
operates in 11 states and the District of Columbia.
News releases and more information about Erie Insurance Group are available at
http://www.erieinsurance.com
"Safe Harbor" Statement Under the Private Securities Litigation Reform Act of
1995: Certain forward-looking statements contained herein involve risks and
uncertainties. These statements include certain discussions relating to
management fee revenue, cost of management operations, underwriting, premium and
investment income volume, business strategies, profitability and business
relationships and the Company's other business activities during 2002 and
beyond. In some cases, you can identify forward-looking statements by terms such
as "may," will," "should," "could," "would," "expect," "plan," "intend,"
"anticipate," "believe," "estimate," "project," "predict," "potential" and
similar expressions. These forward-looking statements reflect the Company's
current views about future events, are based on assumptions and are subject to
known and unknown risks and uncertainties that may cause results to differ
materially from those anticipated in those statements. Many of the factors that
will determine future events or achievements are beyond our ability to control
or predict.
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