Erie Indemnity Company · NASDAQ:ERIE
Erie Indemnity — Investor Presentation (May 2010)
23 slides from Erie Indemnity's investor presentation, May 2010
Slide 1: ASC 810 New Financial Presentation
Erie Indemnity Company Consolidated Financial Statements ASC 810 New Financial Presentation
Slide 2: Legal Disclaimer
Erie Indemnity Company Consolidated Financial Statements Legal Disclaimer Certain statements, including financial presentations, in the following discussion on the impact of ACS 810 on Erie Indemnity Company may be deemed to be forward-looking statements within the meaning of the Private Securities
Slide 3: ASC 810 New Financial Presentation
Erie Indemnity Company Consolidated Financial Statements ASC 810 New Financial Presentation
Slide 4: Objectives of Presentation
Erie Indemnity Company Consolidated Financial Statements Objectives of Presentation 1. Explain Financial Accounting Standard ASC 810-Consolidations 2. Provide clarification on the definition of the entities 3. Provide a summary of the impact of ASC 810 on Erie Indemnity Company 4. Provide an explana
Slide 5: Financial Accounting Standard ASC 810
Erie Indemnity Company Consolidated Financial Statements Financial Accounting Standard ASC 810 1. Formerly known as Financial Accounting Standard 167 2. Defines a variable interest entity or VIE as one where the owners do not hold the decision- making capabilities 3. The primary beneficiary of a VIE
Slide 6: Naming Conventions
Erie Indemnity Company Consolidated Financial Statements Naming Conventions . "Erie Indemnity Company" ("Indemnity"): Attorney-in-fact for Erie Insurance Exchange e "Indemnity shareholder interest": equity owned by the Class A and Class B shareholders of Indemnity . "Erie Insurance Exchange" or the
Slide 7: Naming Conventions
Erie Indemnity Company Consolidated Financial Statements Naming Conventions 4. "Property and Casualty Group": Combined property and casualty insurance subsidiaries of Indemnity and the Exchange and its subsidiary 5. Consolidated financial statements of Erie Indemnity Company represent combined resul
Slide 8: Impact of ASC 810
Erie Indemnity Company Consolidated Financial Statements Impact of ASC 810 Adopted by Erie Indemnity Company effective January 1, 2010 Requires Erie Indemnity Company to consolidate the results of Indemnity and the Exchange Reflected in 1st quarter 2010 Form 10-Q and in Form 8-K with revised section
Slide 9: Impact of ASC 810
Erie Indemnity Company Consolidated Financial Statements Impact of ASC 810 Changes the presentation of financial reports. . . 1. The dollar amounts are rounded to millions 2. Renamed "Insurance Underwriting Operating Segment" as "Property and Casualty Insurance Operating Segment" 3. Increased operat
Slide 10: Impact of ASC 810: Income Statement Presentation
Erie Indemnity Company Consolidated Financial Statements Impact of ASC 810 Income Statement Presentation Changes to the Income Statement presentation. . . 1. The revenue and expenses of Indemnity and the Exchange are consolidated 2. The term “noncontrolling interest" represents the interests of the
Slide 11: Consolidated Statements of Operations
ERIE INDEMNITY COMPANY CONSOLIDATED STATEMENTS OF OPERATIONS Years ended December 31, 2009 and 2008 (As adjusted (Note 2)) (dollars in millions, except per share data) 2009 2008 Revenues Premiums earned $3,869 $3,834 Net investment income 433 438 Net realized investment gains (losses) 412 (1,026) Ne
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Slide 13: 8-K Filing with Exchange Consolidation
8-K Filing with Exchange Consolidation Management's Discussion and Analysis Operating Overview, page 57 Results of Erie Insurance Group’s Operations by_Interest __ Eliminations of Indemnity Noncontrolling interest 2 related par Erie Insurance tite ition} shareholder interests (exchange) tronsactone
Slide 14: Impact of ASC 810: Balance Sheet Presentation
Erie Indemnity Company Consolidated Financial Statements Impact of ASC 810 Balance Sheet Presentation 1. Indemnity shareholders and Indemnity creditors have no rights to the assets of the Exchange 2. Policyholders and creditors of the Exchange do not have rights to the assets of Indemnity 3. Surplus
Slide 15: Consolidated Statements of Financial Position
ERIE INDEMNITY COMPANY CONSOLIDATED STATEMENTS OF FINANCIAL POSITION At December 31, 2009 and 2008 (dollars in millions. except per share date) (As adjusted (Note 2)} 8-K Filing with Exchange Consolidation 2009 2008 Assats, Investments-Indemnity Available-for-sale securities, at fair value: 1 Fixed
Slide 16: Impact of ASC 810: Balance Sheet Presentation
Erie Indemnity Company Consolidated Financial Statements Impact of ASC 810 Balance Sheet Presentation Additional Balance Sheet details are reflected in Note 22 of the 8-K financials: 8-K, Note 22, Page 48, Consolidated Statements of Financial Position 1. Individual Balance Sheet of Indemnity and the
Slide 17: Balance Sheet Reconciliation
Erie Indemnity Company Balance Sheet Reconciliation Pre-1*' quarter 2010 to post 1** quarter 2010 Note 22. Indemnity supplemental information December 31, 2009 (in mitions) Assets Investments Available-for-sale securities, at fair value: Fixed maturities Equity securities Trading securities, at fair
Slide 18: Impact of ASC 810: Cash Flow Presentation
Erie Indemnity Company Consolidated Financial Statements Impact of ASC 810 Cash Flow Presentation Changes to the cash flow presentation. . . 1. Management fee revenue is eliminated in consolidation 2. Purchases and sales of investments by the Exchange are consolidated with purchases and sales of inv
Slide 19: Consolidated Statements of Cash Flows
ERIE INDEMNITY COMPANY CONSOLIDATED STATEMENTS OF CASH FLOWS At Decombor 31, 2009 and 2008 {in mitions) (As adjusted (Note 2)) 8-K Filing with Exchange Consolidation 2008 2008 Cash flows from operating activities Pramiums collected $3,964 $3,830 Not investment income received 421 453 Limited partner
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Slide 21: Indemnity's components of direct cash flows
Indemnity’s components of direct cash flaws as included in the Consolidated Statements of Cash Flows is as follows for the years ended December 31: Direct method of cash flows Indemnity {in mittions) 2008 2008 Management fee received $912 $898 Service agreement fee received 35 32 Premiums collected
Slide 22: Summary
Erie Indemnity Company Consolidated Financial Statements Summary 1. Adopted by Erie Indemnity Company effective January 1, 2010 2. Requires Erie Indemnity Company to consolidate the results of Indemnity and the Exchange 3. Reflected in 1st quarter 2010 10-Q and Form 8-K filed May 6, 2010 with sectio
Slide 23: Event Dates
Erie Indemnity Company — Investor Presentation (May 2010) on 6ix