ERIE - Earnings call 4 2023 | Erie Indemnity Company

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Operator

Good morning, and welcome to the Erie Indemnity Company Fourth Quarter and Year-End 2023 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.

Scott Beilharz

Thank you, and welcome, everyone. We appreciate you joining us for this recorded discussion about our fourth quarter and year-end results. remarks Julie NeCastro, and Pelkowski, Officer. include Executive and Chief will and Officer; Executive recording from President Tim Chief Financial This Vice President

earnings Investor Relations yesterday of our were closed Our are section financial erieinsurance.com. the and the after market issued within available website, and release afternoon supplement

known to assumptions I These to unexpected current today's views may and future everyone events. discussion subject reflect may These we begin, uncertainties remarks. those remind that company's Before contain are differ described the on based remarks to would like uncertainties. and and that forward-looking remarks from risks these materially about in risks results cause

with on safe of yesterday be by and the please Company. For factors release. reproduced cause may in see the Erie important related rebroadcast party harbor such of prerecorded property written our without the in may the press call is differences, It not consent or filing the other Indemnity prior SEC information statements This Erie filed that XX-K Company. Indemnity any Form

With on remarks. to move that, Tim? Tim's we will

Timothy NeCastro

of with record-setting so doing to a and fourth and year XXXX. all year-end proudly as came growth billion we're for the you and a and challenges. to time a $XX both reached to This for premium, a in in thanks service, learn fourth more company results Scott, Thanks, We're significant milestone closer moving quarter century taking of about in celebrating Erie's quarter XXXX. of of

Insurance in us towards and $XX a high us We mark X all-time for $XXX reaching and high hit an saw moving million of XX-year Indemnity Erie than income helping million, billion hit policies Company XX%, net more force. growth of that Erie for Exchange

ended XX,XXX environmental in a focus higher typical we've said, year than nearly rate in to that weather-related partnering continue our claims XXXX the year-end and our second XX,XXX individualized the in profitability X through claims with market we're our pressures all negative leveling independent the the on compared overall standards decline also year half we With Even economic XXXX. and conditions rose roughly certainly industry. ratio of been and to Weather-related in XXX.X%, of underwriting to of impact the increases, the effects feeling plans that claims the reinforcing with combined out, with action responded tough where XXXX. agents to We've on severity points appropriate. and

at improving time. This ratio the multipronged aimed approach is over combined

work see emphasis we've placed through savings managing expenses our legacy digital technology on platforms to capabilities. and long-term and across In to a expect addition, greater modernize new to the enterprise introduce

I'll Julie Officer, on But deeper in of with share update Pelkowski to minutes. first, efforts few like Julie? financials. our those provide introduce an I'd review who a modernization Chief will progress recent a Financial

Julie Pelkowski

you, Thank we've the challenge morning, Tim, events exchange. how weather the good for and discussed XXXX, everyone. severity drivers were of profitability Throughout and the primary

we've As several Tim profitability. action mentioned, taken fronts improving aimed at on

increases come. starting of significant to the to taken rate more more recently benefits are We the with see

it takes so As to competitors, XX longer of our a span the unlike policy most realize months, reminder, our benefits.

growth in increases. yet haven't these despite and new seen a XX.X% levels rate business slowdown at strong retention We remained our

at XXXX. at December billion ended surplus Policyholder $X.X

more events a the September from million. Again, positive was year $XXX combined did this where was of and the improvement lower an increasing year-to-date fourth surplus for fourth the experienced severity given a which we started quarter lower XXX.X%, weather than ended While year, in at we see moderate with growth. level turn the quarter the ratio

$XXX or XXXX. quarter fourth in million $X.XX the XXXX fourth or Turning million or diluted over compared to per diluted indemnity. per million was results $X.XX the income million in $XX.X compared $XXX $X.XX of year income to Net to $X.XX per was XXXX. net share of for almost just share or diluted $XXX share total XXXX the quarter share per in diluted

fourth quarter million compared in $XX income Operating XXXX. increased or fourth nearly the XX.X% quarter to of the

in an revenue saw growth XX.X% Both compared $XXX or income total of operating growth. the to XXXX. increase indemnity million For outpace year, experienced periods expense

premium From both quarter a renewal was $XXX or Main issuance in million and respective line total the of year year new and fee in XXXX. Exchange. $XX revenue increases the was grew the year to the premiums XXXX premium, the same exchange fourth or of business increased that almost services to were revenue over management policy XX% fourth periods. and XX.X% quarter the substantial the compared total perspective, in the for XX% the increase XXXX from million the fourth of in compared These quarter to to in the increases quarter and in over which experience respective and over driver continuing prior direct of fourth for the with XX% assumed year written growth compared

over operations just XXXX increased million XX.X% from million and the issuance $XXX of for year XX% quarter cost almost total total renewal the the to periods the perspective, same for expense policy XXXX. an $XX and fourth or compared or From services in

million. additional while over the fourth grew both technology million The million, quarter $X offset in in customer increase commission the assumed $X and increase of Our commission Noncommission $XX by the both total million are total the service of driven quarter, affiliated of quarter fourth for fourth cost year of expenses, periods the Exchange. by million, increased and million. The costs written direct were most grew year $XXX for sales noncommission and the investments grew expenses million. expenses by lower in higher nearly of expenses while driven significant operations was premiums $X commissions $X $XX advertising

of due our and technology a The expenses deliveries noncommission of and million technology personnel customer service $XX higher in administrative higher almost expenses costs. Tim will minutes. detail other in of driven provide year couple to increase in total investments greater on million additional and $XX was by

to costs led of increase in an processing policy and in policies $X.X growth So million. underwriting number the of

the million to in compared income $XX of investments fourth pretax XXXX. Our XXXX of in quarter almost $XXX,XXX fourth quarter the generated in

to For from pretax for XXXX, million the $XX $XXX,XXX XXXX. compared was total year income investments

our in shareholders Class we the in last our approved dividends. A in year, shares. regular for increase and December of our Also, Class Finally, in quarterly board both paid million XXXX cash a XXXX, X.X% B $XXX dividend

I'll turn Now to the call over Tim? back Tim.

Timothy NeCastro

new pace Thanks, consumer Julie. technology behaviors and The urgency of heightened capabilities. changing sense rapid platforms of to and digital our a modernize have introduce

we long-term to As expense our to it's and offer and earlier, it's products top why critical priorities important modernization one we customer-centric our I to of mentioned That's XXXX. savings, and made in services. ability innovative know

the platform, of that platforms legacy cloud, the secure reduction cloud migration several more reduced our and stable, date a example now Largest a infrastructure to to is technology seeing costs. Erie notable is conversion which outage Center significantly XX% A in progress system time Claims was is of and efficient.

footprint, their every third refreshed that platform capabilities, a pilot new out Indiana. for a refresh for the online policy manage we time, servicing have customers compensation account that call, that successfully Since quarter our shared payments. in ability introduces rolled state commercial starting to launched billing allows the platform full I workers' in the In automatic in our our teams platform customers and

XXXX, valuable interface agents and more share of handlers to of important made customers, provided was and to a were in tool XXX% tool user updates are more make and progress of robust. Nearly XX information auto puts to helping the at portal, that more and by made important claims XX% claim to enhancements significant information claims than property the our can the status customers. improve fingertips the to faster agents Other the handlers the tool with different than handle enhancement platform In claims claims efficiently. the the more using and

of on of embracing to investments. wellness improve an Automation, and value platform. Trust online announced recently, Indemnity tech-enabled Roots help manual and personal insurance and leverages XXXX our chain. the the us Will venture investments which initial we're work demanded and and is estate capital commercial offers innovation pet behind processes making planning investing by Erie's and also to Company deliver These to today's ways focuses the continuing of XXXX, automate modernization working which insurance intelligence strategic and formed arm Erie insurance. efforts agile Wagmo, are start-up speed that time-consuming through in marketplace, ventures. This And capabilities in market beyond, we're artificial we faster, spirit & X in

the deliver to These to policyholders. initial value have that potential our agents and adjacencies are investments Erie,

and expertise. help and In capital, bring industry addition portfolio entrepreneurs products to the support to also start-up our from We to look innovative benefit the to visionary more build market. to services continuing Erie's companies forward

the best weather more coming from December, and been mentioned have home which the in, customer Erie's the J.D. Homeowners insurance. like of score In insurance those I over claims the score than for is rental in even to Power's flat XXXX-point accolades earlier both ranked Insurance prior the significantly Power J.D. Erie, As year. #X for both meaningful. year average XXX year, we J.D. recently received call, overall XXXX. makes Power And when compared satisfaction a higher in improved segment scale, the and and our XX ranking during cited study homeowner on satisfaction points homeowners up was previous

the service, I'd from experience claims independent two agent another place like first in and in personal J.D. other XXXX, on to rankings heels of lines. property This one satisfaction operations recognition for and first our comes for Power and in even my employees care especially these from times. to express in claims, gratitude continuing be demanding agents loss frontline all to and notice above of in customer

in for Thank your and in interest listening Erie. for today continued you all

Erie Indemnity (ERIE) 27 Feb 242023 Q4 Earnings call transcript