|
ERIE INDEMNITY COMPANY
|
|
|
(Exact name of registrant as specified in its charter)
|
|
|
PENNSYLVANIA
|
|
25-0466020
|
|
|
(State or other jurisdiction of
|
|
(I.R.S. Employer
|
|
|
incorporation or organization)
|
|
Identification No.)
|
|
|
100 Erie Insurance Place, Erie, Pennsylvania
|
|
16530
|
|
|
(Address of principal executive offices)
|
|
(Zip Code)
|
|
|
|
|
|
|
|
(814) 870-2000
|
|
|
(Registrant’s telephone number, including area code)
|
|
|
Not applicable
|
|
|
(Former name, former address and former fiscal year, if changed since last report)
|
|
ITEM 1.
|
FINANCIAL STATEMENTS
|
|
|
Three months ended
|
|
Nine months ended
|
||||||||||||
|
|
September 30,
|
|
September 30,
|
||||||||||||
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Operating revenue
|
|
|
|
|
|
|
|
|
|
|
||||||
Management fee revenue, net
|
|
$
|
435,214
|
|
|
$
|
411,139
|
|
|
$
|
1,268,591
|
|
|
$
|
1,195,262
|
|
Service agreement revenue
|
|
7,278
|
|
|
7,267
|
|
|
21,781
|
|
|
21,756
|
|
||||
Total operating revenue
|
|
442,492
|
|
|
418,406
|
|
|
1,290,372
|
|
|
1,217,018
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Operating expenses
|
|
|
|
|
|
|
|
|
||||||||
Commissions
|
|
248,677
|
|
|
232,455
|
|
|
720,538
|
|
|
676,963
|
|
||||
Salaries and employee benefits
|
|
60,499
|
|
|
53,265
|
|
|
181,013
|
|
|
161,579
|
|
||||
All other operating expenses
|
|
52,480
|
|
|
50,431
|
|
|
158,407
|
|
|
142,797
|
|
||||
Total operating expenses
|
|
361,656
|
|
|
336,151
|
|
|
1,059,958
|
|
|
981,339
|
|
||||
Operating income
|
|
80,836
|
|
|
82,255
|
|
|
230,414
|
|
|
235,679
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Investment income
|
|
|
|
|
|
|
|
|
||||||||
Net investment income
|
|
5,970
|
|
|
5,331
|
|
|
18,184
|
|
|
14,884
|
|
||||
Net realized investment gains
|
|
899
|
|
|
718
|
|
|
1,539
|
|
|
29
|
|
||||
Net impairment losses recognized in earnings
|
|
0
|
|
|
0
|
|
|
(182
|
)
|
|
(345
|
)
|
||||
Equity in earnings (losses) of limited partnerships
|
|
1,537
|
|
|
(1,723
|
)
|
|
1,899
|
|
|
(279
|
)
|
||||
Total investment income
|
|
8,406
|
|
|
4,326
|
|
|
21,440
|
|
|
14,289
|
|
||||
Interest expense, net
|
|
377
|
|
|
—
|
|
|
800
|
|
|
—
|
|
||||
Income before income taxes
|
|
88,865
|
|
|
86,581
|
|
|
251,054
|
|
|
249,968
|
|
||||
Income tax expense
|
|
30,322
|
|
|
29,205
|
|
|
86,108
|
|
|
85,388
|
|
||||
Net income
|
|
$
|
58,543
|
|
|
$
|
57,376
|
|
|
$
|
164,946
|
|
|
$
|
164,580
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||
Earnings Per Share
|
|
|
|
|
|
|
|
|
|
|
||||||
Net income per share
|
|
|
|
|
|
|
|
|
|
|
||||||
Class A common stock – basic
|
|
$
|
1.26
|
|
|
$
|
1.23
|
|
|
$
|
3.54
|
|
|
$
|
3.53
|
|
Class A common stock – diluted
|
|
$
|
1.12
|
|
|
$
|
1.09
|
|
|
$
|
3.15
|
|
|
$
|
3.14
|
|
Class B common stock – basic
|
|
$
|
189
|
|
|
$
|
185
|
|
|
$
|
531
|
|
|
$
|
530
|
|
Class B common stock – diluted
|
|
$
|
189
|
|
|
$
|
185
|
|
|
$
|
531
|
|
|
$
|
529
|
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted average shares outstanding – Basic
|
|
|
|
|
|
|
|
|
|
|
||||||
Class A common stock
|
|
46,188,949
|
|
|
46,188,980
|
|
|
46,186,109
|
|
|
46,188,971
|
|
||||
Class B common stock
|
|
2,542
|
|
|
2,542
|
|
|
2,542
|
|
|
2,542
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Weighted average shares outstanding – Diluted
|
|
|
|
|
|
|
|
|
|
|
||||||
Class A common stock
|
|
52,316,876
|
|
|
52,411,303
|
|
|
52,342,450
|
|
|
52,442,697
|
|
||||
Class B common stock
|
|
2,542
|
|
|
2,542
|
|
|
2,542
|
|
|
2,542
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Dividends declared per share
|
|
|
|
|
|
|
|
|
|
|
||||||
Class A common stock
|
|
$
|
0.7825
|
|
|
$
|
0.7300
|
|
|
$
|
2.3475
|
|
|
$
|
2.1900
|
|
Class B common stock
|
|
$
|
117.375
|
|
|
$
|
109.500
|
|
|
$
|
352.125
|
|
|
$
|
328.500
|
|
|
|
Three months ended
|
|
Nine months ended
|
||||||||||||
|
|
September 30,
|
|
September 30,
|
||||||||||||
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Net income
|
|
$
|
58,543
|
|
|
$
|
57,376
|
|
|
$
|
164,946
|
|
|
$
|
164,580
|
|
|
|
|
|
|
|
|
|
|
||||||||
Other comprehensive income, net of tax
|
|
|
|
|
|
|
|
|
|
|
||||||
Change in unrealized holding (losses) gains on available-for-sale securities
|
|
(167
|
)
|
|
355
|
|
|
2,446
|
|
|
6,846
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Comprehensive income
|
|
$
|
58,376
|
|
|
$
|
57,731
|
|
|
$
|
167,392
|
|
|
$
|
171,426
|
|
|
|
September 30,
|
|
December 31,
|
||||
|
|
2017
|
|
2016
|
||||
Assets
|
|
(Unaudited)
|
|
|
||||
Current assets:
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
184,628
|
|
|
$
|
189,072
|
|
Available-for-sale securities
|
|
65,318
|
|
|
56,138
|
|
||
Receivables from Erie Insurance Exchange and affiliates
|
|
428,500
|
|
|
378,540
|
|
||
Prepaid expenses and other current assets
|
|
35,797
|
|
|
30,169
|
|
||
Federal income taxes recoverable
|
|
0
|
|
|
5,260
|
|
||
Accrued investment income
|
|
6,435
|
|
|
6,337
|
|
||
Total current assets
|
|
720,678
|
|
|
665,516
|
|
||
|
|
|
|
|
||||
Available-for-sale securities
|
|
683,948
|
|
|
657,153
|
|
||
Limited partnership investments
|
|
49,451
|
|
|
58,159
|
|
||
Fixed assets, net
|
|
75,370
|
|
|
69,142
|
|
||
Deferred income taxes, net
|
|
47,558
|
|
|
53,889
|
|
||
Note receivable from Erie Family Life Insurance Company
|
|
25,000
|
|
|
25,000
|
|
||
Other assets
|
|
29,424
|
|
|
20,096
|
|
||
Total assets
|
|
$
|
1,631,429
|
|
|
$
|
1,548,955
|
|
|
|
|
|
|
||||
Liabilities and shareholders' equity
|
|
|
|
|
||||
Current liabilities:
|
|
|
|
|
||||
Commissions payable
|
|
$
|
236,056
|
|
|
$
|
210,559
|
|
Agent bonuses
|
|
93,448
|
|
|
114,772
|
|
||
Accounts payable and accrued liabilities
|
|
99,331
|
|
|
88,153
|
|
||
Dividends payable
|
|
36,441
|
|
|
36,441
|
|
||
Deferred executive compensation
|
|
12,794
|
|
|
19,675
|
|
||
Federal income taxes payable
|
|
5,331
|
|
|
0
|
|
||
Total current liabilities
|
|
483,401
|
|
|
469,600
|
|
||
|
|
|
|
|
||||
Defined benefit pension plans
|
|
208,528
|
|
|
221,827
|
|
||
Employee benefit obligations
|
|
330
|
|
|
756
|
|
||
Deferred executive compensation
|
|
12,777
|
|
|
13,233
|
|
||
Long-term borrowings
|
|
49,734
|
|
|
24,766
|
|
||
Other long-term liabilities
|
|
1,509
|
|
|
1,863
|
|
||
Total liabilities
|
|
756,279
|
|
|
732,045
|
|
||
|
|
|
|
|
||||
Shareholders’ equity
|
|
|
|
|
||||
Class A common stock, stated value $0.0292 per share; 74,996,930 shares authorized; 68,299,200 shares issued; 46,189,068 shares outstanding
|
|
1,992
|
|
|
1,992
|
|
||
Class B common stock, convertible at a rate of 2,400 Class A shares for one Class B share, stated value $70 per share; 3,070 shares authorized; 2,542 shares issued and outstanding
|
|
178
|
|
|
178
|
|
||
Additional paid-in-capital
|
|
16,470
|
|
|
16,300
|
|
||
Accumulated other comprehensive loss
|
|
(118,935
|
)
|
|
(121,381
|
)
|
||
Retained earnings
|
|
2,121,535
|
|
|
2,065,911
|
|
||
Total contributed capital and retained earnings
|
|
2,021,240
|
|
|
1,963,000
|
|
||
Treasury stock, at cost; 22,110,132 shares held
|
|
(1,155,396
|
)
|
|
(1,155,846
|
)
|
||
Deferred compensation
|
|
9,306
|
|
|
9,756
|
|
||
Total shareholders’ equity
|
|
875,150
|
|
|
816,910
|
|
||
Total liabilities and shareholders’ equity
|
|
$
|
1,631,429
|
|
|
$
|
1,548,955
|
|
|
|
Nine months ended
|
||||||
|
|
September 30,
|
||||||
|
|
2017
|
|
2016
|
||||
Cash flows from operating activities
|
|
|
|
|
||||
Management fee received
|
|
$
|
1,225,966
|
|
|
$
|
1,155,234
|
|
Service agreement fee received
|
|
21,781
|
|
|
21,756
|
|
||
Net investment income received
|
|
23,593
|
|
|
19,643
|
|
||
Limited partnership distributions
|
|
2,993
|
|
|
7,222
|
|
||
Decrease in reimbursements collected from affiliates
|
|
(7,335
|
)
|
|
(11,893
|
)
|
||
Commissions paid to agents
|
|
(597,700
|
)
|
|
(565,490
|
)
|
||
Agents bonuses paid
|
|
(118,862
|
)
|
|
(110,503
|
)
|
||
Salaries and wages paid
|
|
(128,071
|
)
|
|
(119,991
|
)
|
||
Pension contribution and employee benefits paid
|
|
(62,837
|
)
|
|
(37,341
|
)
|
||
General operating expenses paid
|
|
(167,985
|
)
|
|
(133,729
|
)
|
||
Income taxes paid
|
|
(70,504
|
)
|
|
(69,357
|
)
|
||
Interest paid
|
|
(705
|
)
|
|
—
|
|
||
Net cash provided by operating activities
|
|
120,334
|
|
|
155,551
|
|
||
|
|
|
|
|
||||
Cash flows from investing activities
|
|
|
|
|
||||
Purchase of investments:
|
|
|
|
|
||||
Available-for-sale securities
|
|
(292,702
|
)
|
|
(269,237
|
)
|
||
Limited partnerships
|
|
(330
|
)
|
|
(449
|
)
|
||
Proceeds from investments:
|
|
|
|
|
||||
Available-for-sale securities sales
|
|
120,418
|
|
|
67,415
|
|
||
Available-for-sale securities maturities/calls
|
|
146,434
|
|
|
96,851
|
|
||
Trading securities
|
|
—
|
|
|
5,171
|
|
||
Limited partnerships
|
|
7,986
|
|
|
12,404
|
|
||
Net purchase of fixed assets
|
|
(18,036
|
)
|
|
(10,415
|
)
|
||
Net (distributions) collections on agent loans
|
|
(4,185
|
)
|
|
1,622
|
|
||
Net cash used in investing activities
|
|
(40,415
|
)
|
|
(96,638
|
)
|
||
|
|
|
|
|
||||
Cash flows from financing activities
|
|
|
|
|
||||
Dividends paid to shareholders
|
|
(109,324
|
)
|
|
(101,989
|
)
|
||
Net proceeds from long-term borrowings
|
|
24,961
|
|
|
—
|
|
||
Net cash used in financing activities
|
|
(84,363
|
)
|
|
(101,989
|
)
|
||
|
|
|
|
|
||||
Net decrease in cash and cash equivalents
|
|
(4,444
|
)
|
|
(43,076
|
)
|
||
Cash and cash equivalents, beginning of period
|
|
189,072
|
|
|
182,889
|
|
||
Cash and cash equivalents, end of period
|
|
$
|
184,628
|
|
|
$
|
139,813
|
|
|
|
Three months ended September 30,
|
||||||||||||||||||||
|
|
2017
|
|
2016
|
||||||||||||||||||
(dollars in thousands, except per share data)
|
|
Allocated net income (numerator)
|
|
Weighted shares (denominator)
|
|
Per-share amount
|
|
Allocated net income (numerator)
|
|
Weighted shares (denominator)
|
|
Per-share amount
|
||||||||||
Class A – Basic EPS:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income available to Class A stockholders
|
|
$
|
58,064
|
|
|
46,188,949
|
|
|
$
|
1.26
|
|
|
$
|
56,906
|
|
|
46,188,980
|
|
|
$
|
1.23
|
|
Dilutive effect of stock-based awards
|
|
0
|
|
|
27,127
|
|
|
—
|
|
|
0
|
|
|
121,523
|
|
|
—
|
|
||||
Assumed conversion of Class B shares
|
|
479
|
|
|
6,100,800
|
|
|
—
|
|
|
470
|
|
|
6,100,800
|
|
|
—
|
|
||||
Class A – Diluted EPS:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income available to Class A stockholders on Class A equivalent shares
|
|
$
|
58,543
|
|
|
52,316,876
|
|
|
$
|
1.12
|
|
|
$
|
57,376
|
|
|
52,411,303
|
|
|
$
|
1.09
|
|
Class B – Basic EPS:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income available to Class B stockholders
|
|
$
|
479
|
|
|
2,542
|
|
|
$
|
189
|
|
|
$
|
470
|
|
|
2,542
|
|
|
$
|
185
|
|
Class B – Diluted EPS:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income available to Class B stockholders
|
|
$
|
479
|
|
|
2,542
|
|
|
$
|
189
|
|
|
$
|
469
|
|
|
2,542
|
|
|
$
|
185
|
|
|
|
Nine months ended September 30,
|
||||||||||||||||||||
|
|
2017
|
|
2016
|
||||||||||||||||||
(dollars in thousands, except per share data)
|
|
Allocated net income (numerator)
|
|
Weighted shares (denominator)
|
|
Per-share amount
|
|
Allocated net income (numerator)
|
|
Weighted shares (denominator)
|
|
Per-share amount
|
||||||||||
Class A – Basic EPS:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Income available to Class A stockholders
|
|
$
|
163,596
|
|
|
46,186,109
|
|
|
$
|
3.54
|
|
|
$
|
163,233
|
|
|
46,188,971
|
|
|
$
|
3.53
|
|
Dilutive effect of stock-based awards
|
|
0
|
|
|
55,541
|
|
|
—
|
|
|
0
|
|
|
152,926
|
|
|
—
|
|
||||
Assumed conversion of Class B shares
|
|
1,350
|
|
|
6,100,800
|
|
|
—
|
|
|
1,347
|
|
|
6,100,800
|
|
|
—
|
|
||||
Class A – Diluted EPS:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Income available to Class A stockholders on Class A equivalent shares
|
|
$
|
164,946
|
|
|
52,342,450
|
|
|
$
|
3.15
|
|
|
$
|
164,580
|
|
|
52,442,697
|
|
|
$
|
3.14
|
|
Class B – Basic EPS:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Income available to Class B stockholders
|
|
$
|
1,350
|
|
|
2,542
|
|
|
$
|
531
|
|
|
$
|
1,347
|
|
|
2,542
|
|
|
$
|
530
|
|
Class B – Diluted EPS:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income available to Class B stockholders
|
|
$
|
1,350
|
|
|
2,542
|
|
|
$
|
531
|
|
|
$
|
1,346
|
|
|
2,542
|
|
|
$
|
529
|
|
•
|
Level 1 – Quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity can access at the measurement date.
|
•
|
Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.
|
•
|
Level 3 – Unobservable inputs for the asset or liability.
|
|
|
At September 30, 2017
|
||||||||||||||
|
|
Fair value measurements using:
|
||||||||||||||
(in thousands)
|
|
Total
|
|
Quoted prices in
active markets for identical assets
Level 1
|
|
Observable inputs
Level 2
|
|
Unobservable inputs
Level 3
|
||||||||
Available-for-sale securities:
|
|
|
|
|
|
|
|
|
||||||||
U.S. treasury
|
|
$
|
11,834
|
|
|
$
|
0
|
|
|
$
|
11,834
|
|
|
$
|
0
|
|
States & political subdivisions
|
|
261,966
|
|
|
0
|
|
|
261,966
|
|
|
0
|
|
||||
Foreign government securities
|
|
507
|
|
|
0
|
|
|
507
|
|
|
0
|
|
||||
Corporate debt securities
|
|
346,372
|
|
|
0
|
|
|
338,457
|
|
|
7,915
|
|
||||
Residential mortgage-backed securities
|
|
25,719
|
|
|
0
|
|
|
25,719
|
|
|
0
|
|
||||
Commercial mortgage-backed securities
|
|
34,331
|
|
|
0
|
|
|
34,331
|
|
|
0
|
|
||||
Collateralized debt obligations
|
|
62,381
|
|
|
0
|
|
|
62,381
|
|
|
0
|
|
||||
Other debt securities
|
|
6,156
|
|
|
0
|
|
|
6,156
|
|
|
0
|
|
||||
Total fixed maturities
|
|
749,266
|
|
|
0
|
|
|
741,351
|
|
|
7,915
|
|
||||
Total available-for-sale securities
|
|
749,266
|
|
|
0
|
|
|
741,351
|
|
|
7,915
|
|
||||
Other investments
(1)
|
|
4,338
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Total
|
|
$
|
753,604
|
|
|
$
|
0
|
|
|
$
|
741,351
|
|
|
$
|
7,915
|
|
|
|
At December 31, 2016
|
||||||||||||||
|
|
Fair value measurements using:
|
||||||||||||||
(in thousands)
|
|
Total
|
|
Quoted prices in
active markets for identical assets Level 1 |
|
Observable inputs
Level 2 |
|
Unobservable inputs
Level 3 |
||||||||
Available-for-sale securities:
|
|
|
|
|
|
|
|
|
||||||||
U.S. treasury
|
|
$
|
5,031
|
|
|
$
|
0
|
|
|
$
|
5,031
|
|
|
$
|
0
|
|
Government sponsored entities
|
|
2,026
|
|
|
0
|
|
|
2,026
|
|
|
0
|
|
||||
States & political subdivisions
|
|
253,132
|
|
|
0
|
|
|
253,132
|
|
|
0
|
|
||||
Corporate debt securities
|
|
322,948
|
|
|
0
|
|
|
313,596
|
|
|
9,352
|
|
||||
Residential mortgage-backed securities
|
|
16,102
|
|
|
0
|
|
|
16,102
|
|
|
0
|
|
||||
Commercial mortgage-backed securities
|
|
36,849
|
|
|
0
|
|
|
36,849
|
|
|
0
|
|
||||
Collateralized debt obligations
|
|
69,253
|
|
|
0
|
|
|
69,253
|
|
|
0
|
|
||||
Other debt securities
|
|
2,000
|
|
|
0
|
|
|
2,000
|
|
|
0
|
|
||||
Total fixed maturities
|
|
707,341
|
|
|
0
|
|
|
697,989
|
|
|
9,352
|
|
||||
Common stock
|
|
5,950
|
|
|
5,950
|
|
|
0
|
|
|
0
|
|
||||
Total available-for-sale securities
|
|
713,291
|
|
|
5,950
|
|
|
697,989
|
|
|
9,352
|
|
||||
Other investments
(1)
|
|
4,412
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Total
|
|
$
|
717,703
|
|
|
$
|
5,950
|
|
|
$
|
697,989
|
|
|
$
|
9,352
|
|
(in thousands)
|
|
Beginning balance at June 30, 2017
|
|
Included in earnings
(1)
|
|
Included
in other comprehensive
income
|
|
Purchases
|
|
Sales
|
|
Transfers into Level 3
(2)
|
|
Transfers out of Level 3
(2)
|
|
Ending balance at September 30, 2017
|
||||||||||||||||
Available-for-sale securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Corporate debt securities
|
|
$
|
9,295
|
|
|
$
|
24
|
|
|
$
|
(60
|
)
|
|
$
|
539
|
|
|
$
|
(1,240
|
)
|
|
$
|
2,633
|
|
|
$
|
(3,276
|
)
|
|
$
|
7,915
|
|
Total fixed maturities
|
|
9,295
|
|
|
24
|
|
|
(60
|
)
|
|
539
|
|
|
(1,240
|
)
|
|
2,633
|
|
|
(3,276
|
)
|
|
7,915
|
|
||||||||
Total available-for-sale securities
|
|
9,295
|
|
|
24
|
|
|
(60
|
)
|
|
539
|
|
|
(1,240
|
)
|
|
2,633
|
|
|
(3,276
|
)
|
|
7,915
|
|
||||||||
Total Level 3 assets
|
|
$
|
9,295
|
|
|
$
|
24
|
|
|
$
|
(60
|
)
|
|
$
|
539
|
|
|
$
|
(1,240
|
)
|
|
$
|
2,633
|
|
|
$
|
(3,276
|
)
|
|
$
|
7,915
|
|
(in thousands)
|
|
Beginning balance at December 31, 2016
|
|
Included in earnings
(1)
|
|
Included
in other comprehensive
income
|
|
Purchases
|
|
Sales
|
|
Transfers into Level 3
(2)
|
|
Transfers out of Level 3
(2)
|
|
Ending balance at September 30, 2017
|
||||||||||||||||
Available-for-sale securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Corporate debt securities
|
|
$
|
9,352
|
|
|
$
|
3
|
|
|
$
|
(108
|
)
|
|
$
|
4,520
|
|
|
$
|
(4,372
|
)
|
|
$
|
8,444
|
|
|
$
|
(9,924
|
)
|
|
$
|
7,915
|
|
Total fixed maturities
|
|
9,352
|
|
|
3
|
|
|
(108
|
)
|
|
4,520
|
|
|
(4,372
|
)
|
|
8,444
|
|
|
(9,924
|
)
|
|
7,915
|
|
||||||||
Total available-for-sale securities
|
|
9,352
|
|
|
3
|
|
|
(108
|
)
|
|
4,520
|
|
|
(4,372
|
)
|
|
8,444
|
|
|
(9,924
|
)
|
|
7,915
|
|
||||||||
Total Level 3 assets
|
|
$
|
9,352
|
|
|
$
|
3
|
|
|
$
|
(108
|
)
|
|
$
|
4,520
|
|
|
$
|
(4,372
|
)
|
|
$
|
8,444
|
|
|
$
|
(9,924
|
)
|
|
$
|
7,915
|
|
(in thousands)
|
|
Beginning balance at June 30, 2016
|
|
Included in earnings
(1)
|
|
Included
in other
comprehensive
income
|
|
Purchases
|
|
Sales
|
|
Transfers into Level 3
(2)
|
|
Transfers out of Level 3
(2)
|
|
Ending balance at September 30, 2016
|
||||||||||||||||
Available-for-sale securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Corporate debt securities
|
|
$
|
8,851
|
|
|
$
|
22
|
|
|
$
|
38
|
|
|
$
|
3,217
|
|
|
$
|
(318
|
)
|
|
$
|
2,514
|
|
|
$
|
(4,135
|
)
|
|
$
|
10,189
|
|
Commercial mortgage-backed securities
|
|
1,003
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
(1,003
|
)
|
|
0
|
|
||||||||
Collateralized debt obligations
|
|
1,200
|
|
|
0
|
|
|
7
|
|
|
3,000
|
|
|
0
|
|
|
2,114
|
|
|
(1,200
|
)
|
|
5,121
|
|
||||||||
Total fixed maturities
|
|
11,054
|
|
|
22
|
|
|
45
|
|
|
6,217
|
|
|
(318
|
)
|
|
4,628
|
|
|
(6,338
|
)
|
|
15,310
|
|
||||||||
Total available-for-sale securities
|
|
11,054
|
|
|
22
|
|
|
45
|
|
|
6,217
|
|
|
(318
|
)
|
|
4,628
|
|
|
(6,338
|
)
|
|
15,310
|
|
||||||||
Total Level 3 assets
|
|
$
|
11,054
|
|
|
$
|
22
|
|
|
$
|
45
|
|
|
$
|
6,217
|
|
|
$
|
(318
|
)
|
|
$
|
4,628
|
|
|
$
|
(6,338
|
)
|
|
$
|
15,310
|
|
(in thousands)
|
|
Beginning balance at December 31, 2015
|
|
Included in earnings
(1)
|
|
Included
in other
comprehensive
income
|
|
Purchases
|
|
Sales
|
|
Transfers into Level 3
(2)
|
|
Transfers out of Level 3
(2)
|
|
Ending balance at September 30, 2016
|
||||||||||||||||
Available-for-sale securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Corporate debt securities
|
|
$
|
69
|
|
|
$
|
67
|
|
|
$
|
119
|
|
|
$
|
11,887
|
|
|
$
|
(924
|
)
|
|
$
|
5,470
|
|
|
$
|
(6,499
|
)
|
|
$
|
10,189
|
|
Commercial mortgage-backed securities
|
|
0
|
|
|
0
|
|
|
3
|
|
|
1,000
|
|
|
0
|
|
|
0
|
|
|
(1,003
|
)
|
|
0
|
|
||||||||
Collateralized debt obligations
|
|
8,577
|
|
|
4
|
|
|
(5
|
)
|
|
7,722
|
|
|
(54
|
)
|
|
2,114
|
|
|
(13,237
|
)
|
|
5,121
|
|
||||||||
Total fixed maturities
|
|
8,646
|
|
|
71
|
|
|
117
|
|
|
20,609
|
|
|
(978
|
)
|
|
7,584
|
|
|
(20,739
|
)
|
|
15,310
|
|
||||||||
Total available-for-sale securities
|
|
8,646
|
|
|
71
|
|
|
117
|
|
|
20,609
|
|
|
(978
|
)
|
|
7,584
|
|
|
(20,739
|
)
|
|
15,310
|
|
||||||||
Total Level 3 assets
|
|
$
|
8,646
|
|
|
$
|
71
|
|
|
$
|
117
|
|
|
$
|
20,609
|
|
|
$
|
(978
|
)
|
|
$
|
7,584
|
|
|
$
|
(20,739
|
)
|
|
$
|
15,310
|
|
(1)
|
These amounts are reported in the Statements of Operations as net investment income and net realized investment gains (losses) for the each of the periods presented above.
|
(2)
|
Transfers into and/or (out) of Level 3 are primarily attributable to the availability of market observable information and the re-evaluation of the observability of pricing inputs.
|
(in thousands)
|
|
At September 30, 2017
|
||||||||||||||
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||
Fixed maturities:
|
|
|
|
|
|
|
|
|
||||||||
Priced via pricing services
|
|
$
|
749,266
|
|
|
$
|
0
|
|
|
$
|
741,351
|
|
|
$
|
7,915
|
|
Total fixed maturities
|
|
749,266
|
|
|
0
|
|
|
741,351
|
|
|
7,915
|
|
||||
Other investments:
|
|
|
|
|
|
|
|
|
||||||||
Priced via unobservable inputs
(1)
|
|
4,338
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Total other investments
|
|
4,338
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Total
|
|
$
|
753,604
|
|
|
$
|
0
|
|
|
$
|
741,351
|
|
|
$
|
7,915
|
|
(1)
|
Other investments measured at fair value represent real estate funds included on the balance sheet as limited partnership investments that are reported under the fair value option using the net asset value practical expedient. These amounts are not required to be categorized in the fair value hierarchy. The fair value of these investments is based on the NAV information provided by the general partner.
|
|
|
At September 30, 2017
|
||||||||||||||
(in thousands)
|
|
Amortized
cost
|
|
Gross unrealized gains
|
|
Gross unrealized losses
|
|
Estimated fair value
|
||||||||
Available-for-sale securities:
|
|
|
|
|
|
|
|
|
||||||||
U.S. treasury
|
|
$
|
11,878
|
|
|
$
|
0
|
|
|
$
|
44
|
|
|
$
|
11,834
|
|
States & political subdivisions
|
|
254,835
|
|
|
7,809
|
|
|
678
|
|
|
261,966
|
|
||||
Foreign government securities
|
|
501
|
|
|
6
|
|
|
0
|
|
|
507
|
|
||||
Corporate debt securities
|
|
345,003
|
|
|
2,201
|
|
|
832
|
|
|
346,372
|
|
||||
Residential mortgage-backed securities
|
|
25,388
|
|
|
404
|
|
|
73
|
|
|
25,719
|
|
||||
Commercial mortgage-backed securities
|
|
34,892
|
|
|
73
|
|
|
634
|
|
|
34,331
|
|
||||
Collateralized debt obligations
|
|
62,193
|
|
|
207
|
|
|
19
|
|
|
62,381
|
|
||||
Other debt securities
|
|
6,119
|
|
|
37
|
|
|
0
|
|
|
6,156
|
|
||||
Total fixed maturities
|
|
740,809
|
|
|
10,737
|
|
|
2,280
|
|
|
749,266
|
|
||||
Total available-for-sale securities
|
|
$
|
740,809
|
|
|
$
|
10,737
|
|
|
$
|
2,280
|
|
|
$
|
749,266
|
|
|
|
At December 31, 2016
|
||||||||||||||
(in thousands)
|
|
Amortized
cost
|
|
Gross unrealized gains
|
|
Gross unrealized losses
|
|
Estimated fair value
|
||||||||
Available-for-sale securities:
|
|
|
|
|
|
|
|
|
||||||||
U.S. treasury
|
|
$
|
5,093
|
|
|
$
|
0
|
|
|
$
|
62
|
|
|
$
|
5,031
|
|
Government sponsored entities
|
|
2,004
|
|
|
22
|
|
|
0
|
|
|
2,026
|
|
||||
States & political subdivisions
|
|
249,312
|
|
|
6,113
|
|
|
2,293
|
|
|
253,132
|
|
||||
Corporate debt securities
|
|
321,041
|
|
|
3,293
|
|
|
1,386
|
|
|
322,948
|
|
||||
Residential mortgage-backed securities
|
|
16,232
|
|
|
61
|
|
|
191
|
|
|
16,102
|
|
||||
Commercial mortgage-backed securities
|
|
37,723
|
|
|
59
|
|
|
933
|
|
|
36,849
|
|
||||
Collateralized debt obligations
|
|
68,998
|
|
|
351
|
|
|
96
|
|
|
69,253
|
|
||||
Other debt securities
|
|
2,000
|
|
|
0
|
|
|
0
|
|
|
2,000
|
|
||||
Total fixed maturities
|
|
702,403
|
|
|
9,899
|
|
|
4,961
|
|
|
707,341
|
|
||||
Common stock
|
|
6,152
|
|
|
0
|
|
|
202
|
|
|
5,950
|
|
||||
Total available-for-sale securities
|
|
$
|
708,555
|
|
|
$
|
9,899
|
|
|
$
|
5,163
|
|
|
$
|
713,291
|
|
|
|
At September 30, 2017
|
||||||
(in thousands)
|
|
Amortized
|
|
Estimated
|
||||
|
|
cost
|
|
fair value
|
||||
Due in one year or less
|
|
$
|
65,085
|
|
|
$
|
65,208
|
|
Due after one year through five years
|
|
332,904
|
|
|
337,986
|
|
||
Due after five years through ten years
|
|
239,042
|
|
|
242,425
|
|
||
Due after ten years
|
|
103,778
|
|
|
103,647
|
|
||
Total fixed maturities
|
|
$
|
740,809
|
|
|
$
|
749,266
|
|
|
|
At September 30, 2017
|
|||||||||||||||||||||||||
(in thousands)
|
|
Less than 12 months
|
|
12 months or longer
|
|
Total
|
|||||||||||||||||||||
|
|
Fair
value
|
|
Unrealized losses
|
|
Fair
value
|
|
Unrealized losses
|
|
Fair
value
|
|
Unrealized losses
|
|
No. of holdings
|
|||||||||||||
Available-for-sale securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
U.S. treasury
|
|
$
|
11,835
|
|
|
$
|
44
|
|
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
11,835
|
|
|
$
|
44
|
|
|
4
|
|
States & political subdivisions
|
|
49,278
|
|
|
449
|
|
|
7,280
|
|
|
229
|
|
|
56,558
|
|
|
678
|
|
|
26
|
|
||||||
Corporate debt securities
|
|
108,828
|
|
|
619
|
|
|
19,951
|
|
|
213
|
|
|
128,779
|
|
|
832
|
|
|
255
|
|
||||||
Residential mortgage-backed securities
|
|
5,553
|
|
|
19
|
|
|
5,771
|
|
|
54
|
|
|
11,324
|
|
|
73
|
|
|
10
|
|
||||||
Commercial mortgage-backed securities
|
|
12,793
|
|
|
106
|
|
|
11,019
|
|
|
528
|
|
|
23,812
|
|
|
634
|
|
|
21
|
|
||||||
Collateralized debt obligations
|
|
16,426
|
|
|
19
|
|
|
0
|
|
|
0
|
|
|
16,426
|
|
|
19
|
|
|
8
|
|
||||||
Total fixed maturities
|
|
204,713
|
|
|
1,256
|
|
|
44,021
|
|
|
1,024
|
|
|
248,734
|
|
|
2,280
|
|
|
324
|
|
||||||
Total available-for-sale securities
|
|
$
|
204,713
|
|
|
$
|
1,256
|
|
|
$
|
44,021
|
|
|
$
|
1,024
|
|
|
$
|
248,734
|
|
|
$
|
2,280
|
|
|
324
|
|
Quality breakdown of fixed maturities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Investment grade
|
|
$
|
152,341
|
|
|
$
|
745
|
|
|
$
|
42,020
|
|
|
$
|
533
|
|
|
$
|
194,361
|
|
|
$
|
1,278
|
|
|
113
|
|
Non-investment grade
|
|
52,372
|
|
|
511
|
|
|
2,001
|
|
|
491
|
|
|
54,373
|
|
|
1,002
|
|
|
211
|
|
||||||
Total fixed maturities
|
|
$
|
204,713
|
|
|
$
|
1,256
|
|
|
$
|
44,021
|
|
|
$
|
1,024
|
|
|
$
|
248,734
|
|
|
$
|
2,280
|
|
|
324
|
|
|
|
At December 31, 2016
|
|||||||||||||||||||||||||
(in thousands)
|
|
Less than 12 months
|
|
12 months or longer
|
|
Total
|
|||||||||||||||||||||
|
|
Fair
value
|
|
Unrealized
losses
|
|
Fair
value
|
|
Unrealized
losses
|
|
Fair
value
|
|
Unrealized
losses
|
|
No. of
holdings
|
|||||||||||||
Available-for-sale securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
U.S. treasury
|
|
$
|
5,031
|
|
|
$
|
62
|
|
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
5,031
|
|
|
$
|
62
|
|
|
1
|
|
States & political subdivisions
|
|
84,611
|
|
|
2,293
|
|
|
0
|
|
|
0
|
|
|
84,611
|
|
|
2,293
|
|
|
40
|
|
||||||
Corporate debt securities
|
|
112,453
|
|
|
987
|
|
|
8,692
|
|
|
399
|
|
|
121,145
|
|
|
1,386
|
|
|
155
|
|
||||||
Residential mortgage-backed securities
|
|
7,451
|
|
|
60
|
|
|
4,974
|
|
|
131
|
|
|
12,425
|
|
|
191
|
|
|
13
|
|
||||||
Commercial mortgage-backed securities
|
|
26,509
|
|
|
437
|
|
|
4,319
|
|
|
496
|
|
|
30,828
|
|
|
933
|
|
|
28
|
|
||||||
Collateralized debt obligations
|
|
27,470
|
|
|
75
|
|
|
4,208
|
|
|
21
|
|
|
31,678
|
|
|
96
|
|
|
15
|
|
||||||
Total fixed maturities
|
|
263,525
|
|
|
3,914
|
|
|
22,193
|
|
|
1,047
|
|
|
285,718
|
|
|
4,961
|
|
|
252
|
|
||||||
Common stock
|
|
5,950
|
|
|
202
|
|
|
0
|
|
|
0
|
|
|
5,950
|
|
|
202
|
|
|
1
|
|
||||||
Total available-for-sale securities
|
|
$
|
269,475
|
|
|
$
|
4,116
|
|
|
$
|
22,193
|
|
|
$
|
1,047
|
|
|
$
|
291,668
|
|
|
$
|
5,163
|
|
|
253
|
|
Quality breakdown of fixed maturities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Investment grade
|
|
$
|
239,041
|
|
|
$
|
3,605
|
|
|
$
|
16,061
|
|
|
$
|
399
|
|
|
$
|
255,102
|
|
|
$
|
4,004
|
|
|
136
|
|
Non-investment grade
|
|
24,484
|
|
|
309
|
|
|
6,132
|
|
|
648
|
|
|
30,616
|
|
|
957
|
|
|
116
|
|
||||||
Total fixed maturities
|
|
$
|
263,525
|
|
|
$
|
3,914
|
|
|
$
|
22,193
|
|
|
$
|
1,047
|
|
|
$
|
285,718
|
|
|
$
|
4,961
|
|
|
252
|
|
(in thousands)
|
|
Three months ended September 30,
|
|
Nine months ended September 30,
|
||||||||||||
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Fixed maturities
|
|
$
|
4,234
|
|
|
$
|
5,245
|
|
|
$
|
16,358
|
|
|
$
|
14,629
|
|
Equity securities
|
|
0
|
|
|
50
|
|
|
49
|
|
|
132
|
|
||||
Cash equivalents and other
|
|
1,936
|
|
|
366
|
|
|
2,852
|
|
|
1,011
|
|
||||
Total investment income
|
|
6,170
|
|
|
5,661
|
|
|
19,259
|
|
|
15,772
|
|
||||
Less: investment expenses
|
|
200
|
|
|
330
|
|
|
1,075
|
|
|
888
|
|
||||
Net investment income
|
|
$
|
5,970
|
|
|
$
|
5,331
|
|
|
$
|
18,184
|
|
|
$
|
14,884
|
|
(in thousands)
|
|
Three months ended September 30,
|
|
Nine months ended September 30,
|
||||||||||||
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Available-for-sale securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Fixed maturities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Gross realized gains
|
|
$
|
1,621
|
|
|
$
|
603
|
|
|
$
|
2,708
|
|
|
$
|
1,175
|
|
Gross realized losses
|
|
(722
|
)
|
|
(27
|
)
|
|
(1,116
|
)
|
|
(1,819
|
)
|
||||
Net realized gains (losses)
|
|
899
|
|
|
576
|
|
|
1,592
|
|
|
(644
|
)
|
||||
Equity securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Gross realized losses
|
|
0
|
|
|
0
|
|
|
(145
|
)
|
|
(34
|
)
|
||||
Net realized losses
|
|
0
|
|
|
0
|
|
|
(145
|
)
|
|
(34
|
)
|
||||
Trading securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Common stock:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Gross realized gains
|
|
0
|
|
|
121
|
|
|
0
|
|
|
707
|
|
||||
Increases in fair value
(1)
|
|
0
|
|
|
21
|
|
|
0
|
|
|
0
|
|
||||
Net realized gains
|
|
0
|
|
|
142
|
|
|
0
|
|
|
707
|
|
||||
Miscellaneous:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Gross realized gains
|
|
0
|
|
|
0
|
|
|
94
|
|
|
0
|
|
||||
Gross realized losses
|
|
0
|
|
|
0
|
|
|
(2
|
)
|
|
0
|
|
||||
Net realized gains
|
|
0
|
|
|
0
|
|
|
92
|
|
|
0
|
|
||||
Net realized investment gains
|
|
$
|
899
|
|
|
$
|
718
|
|
|
$
|
1,539
|
|
|
$
|
29
|
|
(1)
|
The fair value of our common stocks is determined based upon exchange traded prices provided by a nationally recognized pricing service.
|
(in thousands)
|
|
Three months ended September 30,
|
|
Nine months ended September 30,
|
||||||||||||
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Fixed maturities
|
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
(182
|
)
|
|
$
|
(345
|
)
|
Total other-than-temporary impairments
|
|
0
|
|
|
0
|
|
|
(182
|
)
|
|
(345
|
)
|
||||
Portion recognized in other comprehensive income
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
||||
Net impairment losses recognized in earnings
|
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
(182
|
)
|
|
$
|
(345
|
)
|
(in thousands)
|
|
Three months ended September 30,
|
|
Nine months ended September 30,
|
||||||||||||
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||
Equity in earnings (losses) of limited partnerships accounted for under the equity method
|
|
$
|
1,305
|
|
|
$
|
(1,778
|
)
|
|
$
|
1,704
|
|
|
$
|
(436
|
)
|
Change in fair value of limited partnerships accounted for under the fair value option
|
|
232
|
|
|
55
|
|
|
195
|
|
|
157
|
|
||||
Equity in earnings (losses) of limited partnerships
|
|
$
|
1,537
|
|
|
$
|
(1,723
|
)
|
|
$
|
1,899
|
|
|
$
|
(279
|
)
|
(in thousands)
|
|
At September 30, 2017
|
|
At December 31, 2016
|
||||
Private equity
|
|
$
|
33,478
|
|
|
$
|
35,228
|
|
Mezzanine debt
|
|
4,797
|
|
|
6,010
|
|
||
Real estate
|
|
6,838
|
|
|
12,509
|
|
||
Real estate - fair value option
|
|
4,338
|
|
|
4,412
|
|
||
Total limited partnership investments
|
|
$
|
49,451
|
|
|
$
|
58,159
|
|
|
|
|
|
|
|
(in thousands)
|
|
Three months ended September 30,
|
|
Nine months ended September 30,
|
||||||||||||
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Service cost for benefits earned
|
|
$
|
7,777
|
|
|
$
|
7,050
|
|
|
$
|
23,330
|
|
|
$
|
21,150
|
|
Interest cost on benefits obligation
|
|
8,569
|
|
|
8,281
|
|
|
25,706
|
|
|
24,844
|
|
||||
Expected return on plan assets
|
|
(10,317
|
)
|
|
(9,880
|
)
|
|
(30,950
|
)
|
|
(29,640
|
)
|
||||
Prior service cost amortization
|
|
218
|
|
|
174
|
|
|
654
|
|
|
522
|
|
||||
Net actuarial loss amortization
|
|
2,325
|
|
|
2,029
|
|
|
6,975
|
|
|
6,084
|
|
||||
Pension plan cost
(1)
|
|
$
|
8,572
|
|
|
$
|
7,654
|
|
|
$
|
25,715
|
|
|
$
|
22,960
|
|
(1)
|
Pension plan costs represent the total cost before reimbursements to Indemnity from the Exchange and EFL.
|
(in thousands)
|
|
Three months ended
|
|
Three months ended
|
||||||||||||||||
|
|
September 30, 2017
|
|
September 30, 2016
|
||||||||||||||||
|
|
Before Tax
|
|
Income Tax
|
|
Net
|
|
|
Before Tax
|
|
Income Tax
|
|
Net
|
|
||||||
Investment securities:
|
|
|
|
|
|
|
|
|
||||||||||||
AOCI, beginning of period
|
|
$
|
7,974
|
|
$
|
2,791
|
|
$
|
5,183
|
|
|
$
|
13,875
|
|
$
|
4,857
|
|
$
|
9,018
|
|
OCI before reclassifications
|
|
643
|
|
225
|
|
418
|
|
|
1,121
|
|
392
|
|
729
|
|
||||||
Realized investment gains
|
|
(899
|
)
|
(314
|
)
|
(585
|
)
|
|
(576
|
)
|
(202
|
)
|
(374
|
)
|
||||||
OCI (loss)
|
|
(256
|
)
|
(89
|
)
|
(167
|
)
|
|
545
|
|
190
|
|
355
|
|
||||||
AOCI, end of period
|
|
$
|
7,718
|
|
$
|
2,702
|
|
$
|
5,016
|
|
|
$
|
14,420
|
|
$
|
5,047
|
|
$
|
9,373
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Pension and other postretirement plans:
(1)
|
|
|
|
|
|
|
|
|
||||||||||||
AOCI (loss), beginning of period
|
|
$
|
(190,695
|
)
|
$
|
(66,744
|
)
|
$
|
(123,951
|
)
|
|
$
|
(152,910
|
)
|
$
|
(53,519
|
)
|
$
|
(99,391
|
)
|
AOCI (loss), end of period
|
|
$
|
(190,695
|
)
|
$
|
(66,744
|
)
|
$
|
(123,951
|
)
|
|
$
|
(152,910
|
)
|
$
|
(53,519
|
)
|
$
|
(99,391
|
)
|
|
|
|
|
|
|
|
|
|
||||||||||||
Total
|
|
|
|
|
|
|
|
|
||||||||||||
AOCI (loss), beginning of period
|
|
$
|
(182,721
|
)
|
$
|
(63,953
|
)
|
$
|
(118,768
|
)
|
|
$
|
(139,035
|
)
|
$
|
(48,662
|
)
|
$
|
(90,373
|
)
|
Investment securities
|
|
(256
|
)
|
(89
|
)
|
(167
|
)
|
|
545
|
|
190
|
|
355
|
|
||||||
Pension and other postretirement plans
|
|
0
|
|
0
|
|
0
|
|
|
0
|
|
0
|
|
0
|
|
||||||
OCI (loss)
|
|
(256
|
)
|
(89
|
)
|
(167
|
)
|
|
545
|
|
190
|
|
355
|
|
||||||
AOCI (loss), end of period
|
|
$
|
(182,977
|
)
|
$
|
(64,042
|
)
|
$
|
(118,935
|
)
|
|
$
|
(138,490
|
)
|
$
|
(48,472
|
)
|
$
|
(90,018
|
)
|
(in thousands)
|
|
Nine months ended
|
|
Nine months ended
|
||||||||||||||||
|
|
September 30, 2017
|
|
September 30, 2016
|
||||||||||||||||
|
|
Before Tax
|
|
Income Tax
|
|
Net
|
|
|
Before Tax
|
|
Income Tax
|
|
Net
|
|
||||||
Investment securities:
|
|
|
|
|
|
|
|
|
||||||||||||
AOCI, beginning of period
|
|
$
|
3,954
|
|
$
|
1,384
|
|
$
|
2,570
|
|
|
$
|
3,888
|
|
$
|
1,361
|
|
$
|
2,527
|
|
OCI before reclassifications
|
|
5,029
|
|
1,760
|
|
3,269
|
|
|
9,509
|
|
3,328
|
|
6,181
|
|
||||||
Realized investment (gains) losses
|
|
(1,447
|
)
|
(506
|
)
|
(941
|
)
|
|
678
|
|
237
|
|
441
|
|
||||||
Impairment losses
|
|
182
|
|
64
|
|
118
|
|
|
345
|
|
121
|
|
224
|
|
||||||
OCI
|
|
3,764
|
|
1,318
|
|
2,446
|
|
|
10,532
|
|
3,686
|
|
6,846
|
|
||||||
AOCI, end of period
|
|
$
|
7,718
|
|
$
|
2,702
|
|
$
|
5,016
|
|
|
$
|
14,420
|
|
$
|
5,047
|
|
$
|
9,373
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Pension and other postretirement plans:
(1)
|
|
|
|
|
|
|
|
|
||||||||||||
AOCI (loss), beginning of period
|
|
$
|
(190,695
|
)
|
$
|
(66,744
|
)
|
$
|
(123,951
|
)
|
|
$
|
(152,910
|
)
|
$
|
(53,519
|
)
|
$
|
(99,391
|
)
|
AOCI (loss), end of period
|
|
$
|
(190,695
|
)
|
$
|
(66,744
|
)
|
$
|
(123,951
|
)
|
|
$
|
(152,910
|
)
|
$
|
(53,519
|
)
|
$
|
(99,391
|
)
|
|
|
|
|
|
|
|
|
|
||||||||||||
Total
|
|
|
|
|
|
|
|
|
||||||||||||
AOCI (loss), beginning of period
|
|
$
|
(186,741
|
)
|
$
|
(65,360
|
)
|
$
|
(121,381
|
)
|
|
$
|
(149,022
|
)
|
$
|
(52,158
|
)
|
$
|
(96,864
|
)
|
Investment securities
|
|
3,764
|
|
1,318
|
|
2,446
|
|
|
10,532
|
|
3,686
|
|
6,846
|
|
||||||
Pension and other postretirement plans
|
|
0
|
|
0
|
|
0
|
|
|
0
|
|
0
|
|
0
|
|
||||||
OCI
|
|
3,764
|
|
1,318
|
|
2,446
|
|
|
10,532
|
|
3,686
|
|
6,846
|
|
||||||
AOCI (loss), end of period
|
|
$
|
(182,977
|
)
|
$
|
(64,042
|
)
|
$
|
(118,935
|
)
|
|
$
|
(138,490
|
)
|
$
|
(48,472
|
)
|
$
|
(90,018
|
)
|
(1)
|
There are no comprehensive income items or amounts reclassified out of accumulated other comprehensive loss related to postretirement plan items during interim periods.
|
ITEM 2.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
•
|
dependence upon our relationship with the Exchange and the management fee under the agreement with the subscribers at the Exchange;
|
•
|
costs of providing services to the Exchange under the subscriber’s agreement and investments in new technology and systems;
|
•
|
credit risk from the Exchange;
|
•
|
dependence upon our relationship with the Exchange and the growth of the Exchange, including:
|
◦
|
general business and economic conditions;
|
◦
|
factors affecting insurance industry competition;
|
◦
|
dependence upon the independent agency system; and
|
◦
|
ability to maintain our reputation for customer service;
|
•
|
dependence upon our relationship with the Exchange and the financial condition of the Exchange, including:
|
◦
|
the Exchange’s ability to maintain acceptable financial strength ratings;
|
◦
|
factors affecting the quality and liquidity of the Exchange’s investment portfolio;
|
◦
|
changes in government regulation of the insurance industry;
|
◦
|
emerging claims and coverage issues in the industry; and
|
◦
|
severe weather conditions or other catastrophic losses, including terrorism;
|
•
|
ability to attract and retain talented management and employees;
|
•
|
ability to maintain uninterrupted business operations and difficulties with technology or data security breaches, including cyber attacks;
|
•
|
factors affecting the quality and liquidity of our investment portfolio;
|
•
|
our ability to meet liquidity needs and access capital; and
|
•
|
outcome of pending and potential litigation.
|
|
|
Three months ended September 30,
|
|
Nine months ended September 30,
|
||||||||||||||||||||
(dollars in thousands, except per share data)
|
|
2017
|
|
2016
|
|
% Change
|
|
2017
|
|
2016
|
|
% Change
|
||||||||||||
|
|
(Unaudited)
|
|
|
|
|
(Unaudited)
|
|
|
|
||||||||||||||
Total operating revenue
|
|
$
|
442,492
|
|
|
$
|
418,406
|
|
|
5.8
|
|
%
|
|
$
|
1,290,372
|
|
|
$
|
1,217,018
|
|
|
6.0
|
|
%
|
Total operating expenses
|
|
361,656
|
|
|
336,151
|
|
|
7.6
|
|
|
|
1,059,958
|
|
|
981,339
|
|
|
8.0
|
|
|
||||
Operating income
|
|
80,836
|
|
|
82,255
|
|
|
(1.7
|
)
|
|
|
230,414
|
|
|
235,679
|
|
|
(2.2
|
)
|
|
||||
Total investment income
|
|
8,406
|
|
|
4,326
|
|
|
94.3
|
|
|
|
21,440
|
|
|
14,289
|
|
|
50.0
|
|
|
||||
Interest expense, net
|
|
377
|
|
|
—
|
|
|
NM
|
|
|
|
800
|
|
|
—
|
|
|
NM
|
|
|
||||
Income before income taxes
|
|
88,865
|
|
|
86,581
|
|
|
2.6
|
|
|
|
251,054
|
|
|
249,968
|
|
|
0.4
|
|
|
||||
Income tax expense
|
|
30,322
|
|
|
29,205
|
|
|
3.8
|
|
|
|
86,108
|
|
|
85,388
|
|
|
0.8
|
|
|
||||
Net income
|
|
$
|
58,543
|
|
|
$
|
57,376
|
|
|
2.0
|
|
%
|
|
$
|
164,946
|
|
|
$
|
164,580
|
|
|
0.2
|
|
%
|
Net income per share - diluted
|
|
$
|
1.12
|
|
|
$
|
1.09
|
|
|
2.2
|
|
%
|
|
$
|
3.15
|
|
|
$
|
3.14
|
|
|
0.4
|
|
%
|
|
Three months ended September 30,
|
|
Nine months ended September 30,
|
||||||||||||||||
(dollars in thousands)
|
2017
|
2016
|
% Change
|
|
2017
|
2016
|
% Change
|
||||||||||||
|
(Unaudited)
|
|
|
|
(Unaudited)
|
|
|
||||||||||||
Management fee revenue, net
|
$
|
435,214
|
|
$
|
411,139
|
|
5.9
|
|
%
|
|
$
|
1,268,591
|
|
$
|
1,195,262
|
|
6.1
|
|
%
|
Service agreement revenue
|
7,278
|
|
7,267
|
|
0.2
|
|
|
|
21,781
|
|
21,756
|
|
0.1
|
|
|
||||
Total operating revenue
|
442,492
|
|
418,406
|
|
5.8
|
|
|
|
1,290,372
|
|
1,217,018
|
|
6.0
|
|
|
||||
Total operating expenses
|
361,656
|
|
336,151
|
|
7.6
|
|
|
|
1,059,958
|
|
981,339
|
|
8.0
|
|
|
||||
Operating income
|
$
|
80,836
|
|
$
|
82,255
|
|
(1.7
|
)
|
%
|
|
$
|
230,414
|
|
$
|
235,679
|
|
(2.2
|
)
|
%
|
Gross margin
|
18.3
|
%
|
19.7
|
%
|
(1.4
|
)
|
pts.
|
|
17.9
|
%
|
19.4
|
%
|
(1.5
|
)
|
pts.
|
|
Three months ended September 30,
|
|
Nine months ended September 30,
|
||||||||||||||
(dollars in thousands)
|
2017
|
2016
|
% Change
|
|
2017
|
2016
|
% Change
|
||||||||||
|
(Unaudited)
|
|
|
|
(Unaudited)
|
|
|
||||||||||
Direct and assumed premiums written by the Exchange
|
$
|
1,739,654
|
|
$
|
1,643,755
|
|
5.8
|
%
|
|
$
|
5,085,562
|
|
$
|
4,795,446
|
|
6.0
|
%
|
Management fee rate
|
25
|
%
|
25
|
%
|
|
|
|
25
|
%
|
25
|
%
|
|
|
||||
Management fee revenue, gross
|
434,914
|
|
410,939
|
|
5.8
|
|
|
1,271,391
|
|
1,198,862
|
|
6.0
|
|
||||
Change in allowance for management fee returned on cancelled policies
(1)
|
300
|
|
200
|
|
NM
|
|
|
(2,800
|
)
|
(3,600
|
)
|
NM
|
|
||||
Management fee revenue, net of allowance
|
$
|
435,214
|
|
$
|
411,139
|
|
5.9
|
%
|
|
$
|
1,268,591
|
|
$
|
1,195,262
|
|
6.1
|
%
|
(1)
|
Management fees are returned to the Exchange when policies are cancelled mid-term and unearned premiums are refunded. We record an estimated allowance for management fees returned on mid-term policy cancellations.
|
|
Three months ended September 30,
|
|
Nine months ended September 30,
|
||||||||||||||
(in thousands)
|
2017
|
2016
|
% Change
|
|
2017
|
2016
|
% Change
|
||||||||||
|
(Unaudited)
|
|
|
(Unaudited)
|
|
||||||||||||
Commissions:
|
|
|
|
|
|
|
|
||||||||||
Total commissions
|
$
|
248,677
|
|
$
|
232,455
|
|
7.0
|
%
|
|
$
|
720,538
|
|
$
|
676,963
|
|
6.4
|
%
|
Non-commission expense:
|
|
|
|
|
|
|
|
||||||||||
Underwriting and policy processing
|
$
|
36,060
|
|
$
|
33,946
|
|
6.2
|
%
|
|
$
|
108,115
|
|
$
|
102,108
|
|
5.9
|
%
|
Information technology
|
32,688
|
|
31,114
|
|
5.1
|
|
|
102,850
|
|
87,714
|
|
17.3
|
|
||||
Sales and advertising
|
15,722
|
|
14,869
|
|
5.7
|
|
|
46,375
|
|
46,872
|
|
(1.1
|
)
|
||||
Customer service
|
7,083
|
|
5,381
|
|
31.6
|
|
|
20,661
|
|
18,689
|
|
10.5
|
|
||||
Administrative and other
|
21,426
|
|
18,386
|
|
16.5
|
|
|
61,419
|
|
48,993
|
|
25.4
|
|
||||
Total non-commission expense
|
112,979
|
|
103,696
|
|
9.0
|
|
|
339,420
|
|
304,376
|
|
11.5
|
|
||||
Total cost of operations
|
$
|
361,656
|
|
$
|
336,151
|
|
7.6
|
%
|
|
$
|
1,059,958
|
|
$
|
981,339
|
|
8.0
|
%
|
(in thousands)
|
|
Three months ended September 30,
|
|
Nine months ended September 30,
|
||||||||||||||||||
|
|
2017
|
|
2016
|
|
% Change
|
|
2017
|
|
2016
|
|
% Change
|
||||||||||
|
|
(Unaudited)
|
|
|
|
|
(Unaudited)
|
|
|
|
||||||||||||
Net investment income
|
|
$
|
5,970
|
|
|
$
|
5,331
|
|
|
12.0
|
%
|
|
$
|
18,184
|
|
|
$
|
14,884
|
|
|
22.2
|
%
|
Net realized investment gains
|
|
899
|
|
|
718
|
|
|
25.4
|
|
|
1,539
|
|
|
29
|
|
|
NM
|
|
||||
Net impairment losses recognized in earnings
|
|
0
|
|
|
0
|
|
|
0.0
|
|
|
(182
|
)
|
|
(345
|
)
|
|
47.3
|
|
||||
Equity in earnings (losses) of limited partnerships
|
|
1,537
|
|
|
(1,723
|
)
|
|
NM
|
|
|
1,899
|
|
|
(279
|
)
|
|
NM
|
|
||||
Total investment income
|
|
$
|
8,406
|
|
|
$
|
4,326
|
|
|
94.3
|
%
|
|
$
|
21,440
|
|
|
$
|
14,289
|
|
|
50.0
|
%
|
(in thousands)
|
|
Three months ended September 30,
|
|
Nine months ended September 30,
|
||||||||||||
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Securities sold:
|
|
(Unaudited)
|
|
(Unaudited)
|
||||||||||||
Fixed maturities
|
|
$
|
899
|
|
|
$
|
576
|
|
|
$
|
1,592
|
|
|
$
|
(644
|
)
|
Equity securities
|
|
0
|
|
|
0
|
|
|
(145
|
)
|
|
(34
|
)
|
||||
Common stock trading securities
|
|
0
|
|
|
121
|
|
|
0
|
|
|
707
|
|
||||
Common stock increases in fair value
(1)
|
|
0
|
|
|
21
|
|
|
0
|
|
|
0
|
|
||||
Miscellaneous
|
|
0
|
|
|
0
|
|
|
92
|
|
|
0
|
|
||||
Net realized investment gains
(2)
|
|
$
|
899
|
|
|
$
|
718
|
|
|
$
|
1,539
|
|
|
$
|
29
|
|
(1)
|
The fair value of our common stocks is determined based upon exchange traded prices provided by a nationally recognized pricing service.
|
(2)
|
See Part I, Item 1. "Financial Statements - Note 5, Investments, of Notes to Financial Statements" contained within this report for additional disclosures regarding net realized investment gains.
|
(in thousands)
|
|
Three months ended September 30,
|
|
Nine months ended September 30,
|
||||||||||||
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
|
|
(Unaudited)
|
|
(Unaudited)
|
||||||||||||
Private equity
|
|
$
|
594
|
|
|
$
|
(443
|
)
|
|
$
|
822
|
|
|
$
|
(2,240
|
)
|
Mezzanine debt
|
|
387
|
|
|
(120
|
)
|
|
274
|
|
|
(26
|
)
|
||||
Real estate
|
|
556
|
|
|
(1,160
|
)
|
|
803
|
|
|
1,987
|
|
||||
Total equity in earnings (losses) of limited partnerships
|
|
$
|
1,537
|
|
|
$
|
(1,723
|
)
|
|
$
|
1,899
|
|
|
$
|
(279
|
)
|
|
|
Carrying value at
|
|
|
|
Carrying value at
|
|
|
||||||
(dollars in thousands)
|
|
September 30, 2017
|
|
% to total
|
|
December 31, 2016
|
|
% to total
|
||||||
|
|
(Unaudited)
|
|
|
|
|
|
|
||||||
Fixed maturities
|
|
$
|
749,266
|
|
|
94
|
%
|
|
$
|
707,341
|
|
|
90
|
%
|
Common stock
|
|
0
|
|
|
0
|
|
|
5,950
|
|
|
1
|
|
||
Limited partnerships:
|
|
|
|
|
|
|
|
|
||||||
Private equity
|
|
33,478
|
|
|
4
|
|
|
35,228
|
|
|
5
|
|
||
Mezzanine debt
|
|
4,797
|
|
|
1
|
|
|
6,010
|
|
|
1
|
|
||
Real estate
|
|
11,176
|
|
|
1
|
|
|
16,921
|
|
|
3
|
|
||
Real estate mortgage loans
(1)
|
|
156
|
|
|
0
|
|
|
213
|
|
|
0
|
|
||
Total investments
|
|
$
|
798,873
|
|
|
100
|
%
|
|
$
|
771,663
|
|
|
100
|
%
|
|
|
At September 30, 2017
|
||||||||||||||||||||||
(in thousands)
|
|
(Unaudited)
|
||||||||||||||||||||||
Industry Sector
|
|
AAA
|
|
AA
|
|
A
|
|
BBB
|
|
Non- investment
grade
|
|
Fair
value
|
||||||||||||
Basic materials
|
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
15,558
|
|
|
$
|
15,558
|
|
Communications
|
|
0
|
|
|
0
|
|
|
4,018
|
|
|
7,683
|
|
|
24,777
|
|
|
36,478
|
|
||||||
Consumer
|
|
0
|
|
|
1,064
|
|
|
4,651
|
|
|
33,576
|
|
|
48,210
|
|
|
87,501
|
|
||||||
Diversified
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
347
|
|
|
347
|
|
||||||
Energy
|
|
0
|
|
|
1,006
|
|
|
3,002
|
|
|
12,035
|
|
|
17,221
|
|
|
33,264
|
|
||||||
Financial
|
|
0
|
|
|
3,996
|
|
|
24,981
|
|
|
57,283
|
|
|
17,968
|
|
|
104,228
|
|
||||||
Government-municipal
|
|
105,004
|
|
|
148,164
|
|
|
8,798
|
|
|
0
|
|
|
0
|
|
|
261,966
|
|
||||||
Industrial
|
|
0
|
|
|
0
|
|
|
7,035
|
|
|
3,388
|
|
|
22,671
|
|
|
33,094
|
|
||||||
Structured securities
(2)
|
|
70,879
|
|
|
32,202
|
|
|
12,073
|
|
|
5,415
|
|
|
8,018
|
|
|
128,587
|
|
||||||
Technology
|
|
0
|
|
|
3,987
|
|
|
0
|
|
|
6,056
|
|
|
14,814
|
|
|
24,857
|
|
||||||
U.S. treasury
|
|
0
|
|
|
11,834
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
11,834
|
|
||||||
Utilities
|
|
0
|
|
|
0
|
|
|
3,995
|
|
|
4,997
|
|
|
2,560
|
|
|
11,552
|
|
||||||
Total
|
|
$
|
175,883
|
|
|
$
|
202,253
|
|
|
$
|
68,553
|
|
|
$
|
130,433
|
|
|
$
|
172,144
|
|
|
$
|
749,266
|
|
(1)
|
Ratings are supplied by S&P, Moody’s, and Fitch. The table is based upon the lowest rating for each security.
|
(2)
|
Structured securities include residential mortgage-backed securities, commercial mortgage-backed securities, collateralized debt obligations, and asset-backed securities.
|
|
|
|
(in thousands)
|
|
2017
|
|
2016
|
||||
|
|
(Unaudited)
|
||||||
Net cash provided by operating activities
|
|
$
|
120,334
|
|
|
$
|
155,551
|
|
Net cash used in investing activities
|
|
(40,415
|
)
|
|
(96,638
|
)
|
||
Net cash used in financing activities
|
|
(84,363
|
)
|
|
(101,989
|
)
|
||
Net decrease in cash and cash equivalents
|
|
$
|
(4,444
|
)
|
|
$
|
(43,076
|
)
|
ITEM 3.
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
ITEM 4.
|
CONTROLS AND PROCEDURES
|
ITEM 1.
|
LEGAL PROCEEDINGS
|
ITEM 1A.
|
RISK FACTORS
|
ITEM 2.
|
UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
|
ITEM 6.
|
EXHIBITS
|
Exhibit
|
|
|
Number
|
|
Description of Exhibit
|
|
|
|
10.1*
|
|
|
|
|
|
10.2*
|
|
|
|
|
|
31.1*
|
|
|
|
|
|
31.2*
|
|
|
|
|
|
32*
|
|
|
|
|
|
101.INS*
|
|
XBRL Instance Document.
|
|
|
|
101.SCH*
|
|
XBRL Taxonomy Extension Schema Document.
|
|
|
|
101.CAL*
|
|
XBRL Taxonomy Extension Calculation Linkbase Document.
|
|
|
|
101.DEF*
|
|
XBRL Taxonomy Extension Definition Linkbase Document.
|
|
|
|
101.LAB*
|
|
XBRL Taxonomy Extension Label Linkbase Document.
|
|
|
|
101.PRE*
|
|
XBRL Taxonomy Extension Presentation Linkbase Document.
|
|
|
|
Erie Indemnity Company
|
|
|
|
|
(Registrant)
|
|
|
|
|
|
|
|
|
|
|
|
Date:
|
October 26, 2017
|
By:
|
/s/ Timothy G. NeCastro
|
|
|
|
|
Timothy G. NeCastro, President & CEO
|
|
|
|
|
|
|
|
|
By:
|
/s/ Gregory J. Gutting
|
|
|
|
|
Gregory J. Gutting, Executive Vice President & CFO
|
|
(c)
|
Notwithstanding anything in this Article Five to the contrary, Participants and Beneficiaries whose Total Account consists of Erie Indemnity Stock Fund shall be offered the opportunity to divest any amount held in the Erie Indemnity Stock Fund into such other investment options at any time as herein provided. At least three investment options (other than the Erie Indemnity Stock Fund) shall be offered at all times to Participants and Beneficiaries. Each such investment option shall be diversified and have materially different risk and return characteristics. Except as provided in Treasury Regulations Section 1.401(a)(35)-1(e)(2) and (3), restrictions (either direct or indirect) or conditions will not be imposed on investments held in the Erie Indemnity Stock Fund if such restrictions or conditions are not imposed on the investment in other Plan assets.
|
|
|
ERIE INDEMNITY COMPANY
|
|
|
|
ATTEST:
|
|
|
|
|
|
/s/ Brian W. Bolash
|
|
By:
/s/ Sean J. McLaughlin
|
Brian W. Bolash
|
|
Sean J. McLaughlin
|
Secretary
|
|
Title:
Executive Vice President and General Counsel
|
NAME
|
LOCATION
:
|
SIZE: ABOVE/BELOW GROUND
|
|
|
|
H.O. Hirt Building
|
100 Erie Insurance Place
Erie, PA 16530
|
93,044 / 28,217
|
|
|
|
F.W. Hirt-Perry
Square Building
|
100 Erie Insurance Place
Erie, PA 16530 |
164,201 / 40,432
|
|
|
|
Petersen Center
|
100 Erie Insurance Place
Erie, PA 16530 |
30,719 / n/a
|
|
|
|
Holland Street Building
|
100 Erie Insurance Place
Erie, PA 16530 |
66,099 / 27,364
|
|
|
|
Lafayette Place
|
400 French Street
Erie, PA 16507
|
17,053 / 5,530
|
|
|
|
Gideon Ball House
|
135 East 6th Street
Erie, PA 16501
|
8,742 / n/a
|
|
|
|
Armory
|
360 East 6th Street
Erie, PA 16507
|
21,722 / 15,349
|
|
|
|
C.F. Adams/
Heritage Center
|
101 East 6th Street
Erie, PA 16501
|
6,036 / 4,325
|
|
|
|
O’Donnell House
|
410 French Street
Erie, PA 16507
|
763 / 763
|
|
|
|
French Street Ramp/
Mail Facility (1983)
|
|
11,760 / 37,646
|
|
|
|
Firehouse
(Effective July 1, 2017)
|
414 French Street
Erie, PA 16507 |
8,832 / 3,030
|
Date:
|
October 26, 2017
|
|
|
|
|
|
|
/s/ Timothy G. NeCastro
|
|
|
Timothy G. NeCastro
|
|
|
President & CEO
|
Date:
|
October 26, 2017
|
|
|
|
|
|
|
/s/ Gregory J. Gutting
|
|
|
Gregory J. Gutting
|
|
|
Executive Vice President & CFO
|
(1)
|
The
Quarterly
Report on Form
10-Q
of the Company for the
quarterly
period ended
September 30, 2017
(the "Report") fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m); and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
/s/ Timothy G. NeCastro
|
|
Timothy G. NeCastro
|
|
President & CEO
|
|
|
|
/s/ Gregory J. Gutting
|
|
Gregory J. Gutting
|
|
Executive Vice President & CFO
|
|
|
|
|
|
October 26, 2017
|
|