Good morning and welcome to the Erie Indemnity Company Second Quarter 2024 Earnings Conference Call. This call is 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 Invest Relations, Scott Beilharz.

Thank you and welcome everyone. We appreciate you joining us for this recorded discussion about our second quarter results. This recording will include remarks from Tim NeCastro, President and Chief Executive Officer; and Julie Pelkowski, 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 investment 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 this differences, please see the safe harbor statements in our Form 10-Q filing with the SEC filed yesterday and in the related press release. This pre-recorded 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 remarks. Tim?

Thanks, Scott. And thanks to all of you for taking time to learn more about Erie's performance in the second quarter of 2024. As we reach the halfway point of our 99th year in business, I'm excited to share that we also reached a significant milestone for Erie insurance exchange, 7 million policies in force. Our last milestone was 6 million policies in force was reached in 2021, and adding 1 million policies to our book of business in just three years is no small feat. To give you a sense of scale, it took our company more than 60-years to reach our first million, and just 3, to get from 6 million to 7 million. So this recent milestone is no doubt a testament to our hardworking agency force and dedicated sales and underwriting teams. Our impressive growth and customer retention, which stands at just over 91% for personal and commercial lines combined, underscore the strong value proposition we offer. Putting service above all else is always our top priority and customers notice. That's why we hold true to the principles that have shaped our success for almost 100-years, while continuously adapting for what's ahead. I'm also pleased to share that Erie ranked number 376 on the 2024 Fortune 500 list of largest American Corporations. We moved up 38 spots from last year's ranking of 414. The 2024 list marks our 21st year in the Fortune 500, alongside some of the most well-known and successful companies in the country. Here to share some insights into our financial performance for the second quarter is Chief Financial Officer Julie Pelkowski. Julie?

Thank you, Tim, and good morning, everyone. Erie Insurance Exchange, the insurance operations we manage continue to experience strong growth in the second quarter of 2024, driven by steady new policy growth and solid retention, as Tim just mentioned. In addition, incremental improvements continue to be realized from our more significant rate increases. These increases have had the most impact when addressing our profitability challenge. With these efforts, the exchanges direct written premiums grew 20% in the second quarter of 2024, compared to the second quarter of 2023 with year-to-date growth through June 2024 at that similar 20% level. From a seasonality perspective, we generally see higher weather losses in the first-half of the year. We saw this trend hold true as the exchanges combined ratio was 115.9 in the second quarter of 2024, compared to 118.9 in the second quarter of 2023, with catastrophic weather events contributing 16.2 points and 16.9 points in those same respective periods. Worth noting is the more significant improvement in our year-to-date combined ratio of 111.1 in 2024, compared to 120.8 in the first six months of 2023. In these first six months, catastrophic weather events contributed 12.7 points versus 15.7 points in the same period of 2023. We did experience an improvement in our non-catastrophe loss ratio in the first six months of 2024, compared to 2023 of 72.2 points versus 73.8 points respectively. Additionally, in 2023, higher severity drove adverse development on prior accident years, increasing the combined ratio by 2.9 points. In 2024, moderating severity trends resulted in favorable development on prior accident years, improving the combined ratio by 2 points. In summary, our rate increases are having the desired impact, and with lower weather events and moderating severity in the first-half of 2024, we have seen a profitability improvement, compared…

Thanks, Julie. Earlier in the call, I talked about our long-standing commitment to being above all the service. That means treating customers with care and compassion and handling their needs quickly and effectively. It also means giving them the ability to interact with us in the ways they prefer. To do that, we need to equip our agents with the tools, resources, and capabilities to ensure customers have a positive experience. Much of the work we've been doing over the first six months of 2024 has been focused on just that. We've made several enhancements for our customer and agent-facing platforms, and have made significant progress in our technology modernization journey. One example of an enhancement is the added ability for agents to set up car rentals for policyholders during the first notice of loss process. Now, customers don't need to make a separate call to secure a rental and streamline the process for our agents and first owners of loss teams. Since rolling out to all states in June, agents have set up nearly 2,000 rentals and they rated the ease of effort to do so at 9 out of 10. We also continue to modernize our legacy technology platforms, having successfully migrated four additional applications to the cloud in the first-half of the year. In addition, we recently decommissioned an outdated platform for data disaster recovery and moved to a new environment. This has resulted in notable improvements in replication and recovery times and reduced costs. Much more work is ongoing in our efforts to migrate to more modern platforms, reduce expenses and continuously improve the experience and satisfaction of our customers and agents. At the same time, we're looking at leveraging the emerging technologies and capabilities related to artificial intelligence. We've recently established an AI center of…

This concludes today's conference call. Thank you for participating, you may now disconnect.