Pennsylvania-based Erie Indemnity Company announced results for the fourth quarter and full-year 2004.
For the fourth quarter:
– Net income increased to $61.3 million, up 42.2 percent from
$43.1 million for the same period in 2003.
– Net income per share-diluted increased to $.87 per share, compared to $.61 per share in the comparable quarter for 2003.
– Management fee revenue grew by 6.8 percent.
For the full-year 2004 results, Erie Indemnity reported:
– Net income was up by 13.4 percent to $226.4 million, from
$199.7 million at the end of 2003.
– Net income per share-diluted increased to $3.21 per share at Dec. 31, 2004, from $2.81 at year-end 2003.
– Management fee revenue for the year was $945.1 million, up 7.6 percent over 2003.
“Erie Indemnity Company produced another year of solid results, while we continued to improve the underwriting profitability of the Property and Casualty Group,” noted Jeffrey Ludrof, president and CEO. “The combined efforts of our agents and employees have successfully positioned us to move confidently into 2005. It is imperative that we maintain our underwriting discipline as we now look to put greater emphasis on attracting and retaining the most desirable prospects and policyholders.”
The company’s insurance underwriting operations recorded losses of $0.9 million and $8.0 million in the fourth quarters of 2004 and 2003,
respectively. The reported statutory combined ratio for the Property &
Casualty Group for the fourth quarter was 100.7, compared to 102.1 for the fourth quarter of 2003. The Property & Casualty Group experienced a private passenger auto adjusted statutory combined ratio in the fourth quarter of 2004 of 103.9, which is seasonally the highest loss quarter for the personal auto line.
Historically the company incurs more personal auto claims in the fourth quarter of each year than any other quarter. The Property & Casualty Group strengthened some personal auto reserves for prior accident year claims during the fourth quarter of 2004.
The Property & Casualty Group’s workers’ compensation reserves were also strengthened in the fourth quarter 2004 by about $28 million, approximately $20 million of which represents development of prior year claims.
The company’s reported GAAP combined ratio was 101.7 for the quarter versus 115.8 for the same quarter in 2003.
The company’s share of catastrophe losses totaled $0.5 million and $0.8 million for the three-month periods ended Dec. 31, 2004 and 2003, respectively.
Charges under the excess-of-loss reinsurance agreement with the Exchange were $1.7 million in the fourth quarter 2004 versus $0.7 million in charges recorded during the fourth quarter 2003.
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