Good morning, and welcome to the Erie Indemnity Company First Quarter 2019 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 the call, Vice President of Investor Relations, Scott Beilharz.

Thank you, and welcome, everyone. We appreciate you joining us for this recorded discussion about our 2019 first 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, erieinsurance.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 such differences, please see the safe harbor statements in our Form 10-Q filing with the SEC, dated May 2, 2019, and in the related press release. This prerecorded call is the property of Erie Indemnity Company. It may not be reproduced or rebroadcast by any other party without the prior written consent of Erie Indemnity Company. With that, we will move on to Tim's remarks.

Thank Scott, and thanks to everyone for taking time to learn more about Erie's performance in the first quarter of 2019. We recently marked the 94th anniversary of Erie's start in the auto insurance business and just three days ago, held our annual meeting of shareholders at our home office in Erie, Pennsylvania. We had a good story to tell. 2018 was a strong year for Erie. We continue to grow premium, achieving a significant revenue milestone of direct written premium of $7 billion. We made progress across key initiatives, making a meaningful difference for our agents, customers and employees and in the communities where we do business. The story continued in the first quarter of 2019. As you saw in our press release filed yesterday, Erie Indemnity reported net income of $75 million or $1.44 per diluted share for the quarter. That's nearly $10 million more than the first quarter of 2018. Greg will talk about the drivers of that increase in a few minutes. Before we get into the detail around Indemnity's results, I'd like to share some recent highlights for Erie Insurance Exchange, the insurance operation we manage. In the first quarter, the exchange grew premium 6% over the prior year to almost $1.8 billion. This result exceeds Conning's latest industry forecast of 4.5% growth this year, and it follows 11 straight years that Erie's premium growth has outpaced the industry. Strong retention and an increase in average premium were both significant factors in recent premium growth. Renewal policies grew 4.2%, driving a 7% increase in renewal premium. At 102.2, Erie's combined ratio for the first quarter is down compared to 105.6 a year ago, reflecting fewer and less severe weather events at the start of the year. At the end of the first quarter, policyholder surplus was $9 billion compared to $8.6 billion at the end of 2018. In addition to the strong results of our combined operations, we continue to make progress on our strategic initiatives. I'll talk more about these recent achievements following Greg's review of the financials. Greg?

Thanks, Tim. Good morning, everyone. I am pleased to share with you the results of another strong quarter for Erie Indemnity. But first, I'd like to take a moment to reflect on our 2019 annual shareholders meeting that was held on April 30. At the meeting, we were able to share the results of our strong performance for 2018 and some initiatives we have planned for 2019 that will help us continue to grow. We are proud of our 2018 results where the Exchange grew its direct and affiliated assumed premiums to over $7 billion, marking the 11th consecutive year of growth, and we delivered earnings per share of $5.51, which is the highest earnings per share in our company's history. While we are proud of our past performance, we remain focused on delivering another strong year of results in 2019. I believe the first quarter results speak to that focus. For the first quarter of 2019, net income was $75 million or $1.44 per diluted share compared to $66 million or $1.26 per diluted share in the first quarter of 2018. Operating income increased $8.6 million or 11% in the first quarter of 2019 compared to the first quarter of 2018 as the growth in total operating revenue outpaced the growth in total operating expenses. Indemnity's management fee revenue for policy issuance and renewal services increased $25 million or 6.2% to $431 million in the first quarter of 2019 compared to the first quarter of 2018. Management fee revenue from administrative services increased $1 million or 6.7% to $14 million in the first quarter of 2019 compared to the prior year period. Turning to indemnity's cost of operations related to policy issuance and renewal services, commissions increased $9 million in the first quarter of 2019 compared to the same period in 2018. This was a result of the 6% increase in the direct and affiliated assumed premiums written by the exchange, slightly offset by lower agent incentive costs. Noncommission expenses increased $8 million in the quarter compared to the same period in 2018. Information technology costs increased $5.5 million, primarily due to increased professional fees, while sales and advertising costs decreased $2 million, primarily due to decreased personnel costs and agent-related costs. Administrative and other expenses increased $4.3 million, primarily driven by an increase in the long-term incentive plan costs. This increase was driven by the increase in the company's share price during the quarter compared to the same period in 2018. Personnel costs and all expense categories were lower in the first quarter of 2019 compared to 2018 due to a special bonus awarded to all employees in the first quarter of 2018. Income from investments before taxes totaled $9.8 million in the first quarter of 2019 compared to $6.2 million in the first quarter of 2018. Net realized gains were $2.5 million in the first quarter of 2019 compared to net realized losses of $500,000 in the first quarter of 2018. Net investment income was $8.5 million in the first quarter of 2019 compared to $6.8 million in the first quarter of 2018. Once again, we are focused on delivering another strong year of performance. With that, I'll turn the call back to over to Tim.

Thank you, Greg. Erie is well-positioned for sustained profitable growth and we continue to invest in areas that support our strategic direction. I've talked about these four areas in the past. They are the framework for how we're aligning our resources to sustain and accelerate Erie's success in a changing market. The four areas include strengthening our business platforms and use of data, continuing to enhance the Erie experience, identifying and developing new sources of revenue and preparing the workforce of the future. We're making progress in all of four areas. I'd like to share a few highlights from the first quarter. First, we introduced a new service that helps our customers recover faster following personal lines loss. Customers can choose to have an electronic claims payment delivered directly to their bank account in less than an hour. We partnered with PNC Bank and Visa on this service, making Erie one of just a handful of carriers offering e-payments for claims settlement. We believe that fast delivery of a claims payment is a valuable compliment to the caring service provided by our claims team. Secondly, in an additional effort to improve the experience of customers following a loss, we recently piloted a new service for drivers who need transportation from the scene of an auto accident. Our first notice of loss team provided these customers with a virtual debit card to cover temporary travel expenses, including public transportation, a taxicab or ridesharing service, such as Uber or Lyft. Feedback from the pilot was very positive and we're now preparing to expand this service. Claim reporting is a critical touch point in a customers experience, and it's a moment of truth for us, a moment where we can deliver on the promise of service that comes with every Erie policy. Finally, we continue efforts to enhance the interactions our customers, agents and employees have with Erie that leverages the power of digital, coupled with the human touch. It's an approach that is distinctly Erie. Key to this approach is ongoing engagement with our customers, agents and employees through focus groups and other forms. The goal is to make sure we have a strong understanding of their needs and expectations to align our decisions and actions. Since completing the transition to our new claims management system in early 2018, we've been able to provide agents greater access to information about claims, helping them provide faster, better service directly to customers. Our customer care team is using a new platform that they help design. This platform streamlines access to multiple systems so customer care employees can easily access the information they need to quickly help our agents and customers. These initiatives are ongoing and will continue to build on the direction and progress we've made in the months ahead. Now I'd like to turn to the recent recognition that we received. First, Erie was named one of the nation's best large employers for 2019 by Forbes Magazine. This was an honor for companies with 5,000 or more employees. We take great pride in being a major employer of choice and are especially excited about this recognition, which is based on employees' feedback and their experience. The second honor comes from J.D. Power and speaks to the efforts of our agents and employees to bring on new Erie customers. This award marks the seventh year in a row that Erie was recognized for highest customer satisfaction in J.D. Power's annual auto insurance shopping study. I want to publicly thank our agents and employees for all they do to make Erie successful with our customers and communities. This is a significant honor reflecting the work we do around our largest line of business. Before we close, I want to recognize Dr. Claude Lilly, III, who retired from Erie Indemnity's Board of Directors on April 30, and thank him for his service over the past 19 years. We have a great Board of Directors at Erie and Claude has brought valuable experience and insights to the team throughout his tenure. On behalf of all of us at Erie, I wish Claude the best. Our financial results, our direction and progress and the continued recognition from third parties like J.D. Power give us great confidence that Erie remains well-equipped for success and in the heart and minds of our customers, employees, agents and shareholders. Thank you for your time today. We appreciate your interest in Erie.

Ladies and gentlemen, thank you for participating in today's conference. This concludes today's program. You may all disconnect. Everyone, have a great day. End of Q&A: