Good morning, and welcome to the Erie Indemnity Company First Quarter 2019 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.

Thank you, and welcome, everyone. We appreciate you joining us for this recorded discussion about our 2019 first quarter results. This recording will include remarks from Tim NeCastro, President and Chief Executive Officer; and Greg Gutting, 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 Investor 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 such differences, please see the safe harbor statements in our Form 10-Q filing with the SEC, dated May 2, 2019, and in the related press release. This prerecorded 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's remarks.

Thank Scott, and thanks to everyone for taking time to learn more about Erie's performance in the first quarter of 2019. We recently marked the 94th anniversary of Erie's start in the auto insurance business and just three days ago, held our annual meeting of shareholders at our home office in Erie, Pennsylvania. We had a good story to tell. 2018 was a strong year for Erie. We continue to grow premium, achieving a significant revenue milestone of direct written premium of $7 billion. We made progress across key initiatives, making a meaningful difference for our agents, customers and employees and in the communities where we do business. The story continued in the first quarter of 2019. As you saw in our press release filed yesterday, Erie Indemnity reported net income of $75 million or $1.44 per diluted share for the quarter. That's nearly $10 million more than the first quarter of 2018. Greg will talk about the drivers of that increase in a few minutes. Before we get into the detail around Indemnity's results, I'd like to share some recent highlights for Erie Insurance Exchange, the insurance operation we manage. In the first quarter, the exchange grew premium 6% over the prior year to almost $1.8 billion. This result exceeds Conning's latest industry forecast of 4.5% growth this year, and it follows 11 straight years that Erie's premium growth has outpaced the industry. Strong retention and an increase in average premium were both significant factors in recent premium growth. Renewal policies grew 4.2%, driving a 7% increase in renewal premium. At 102.2, Erie's combined ratio for the first quarter is down compared to 105.6 a year ago, reflecting fewer and less severe weather events at the start of the year. At the end of the first quarter, policyholder surplus was $9 billion compared to $8.6 billion at the end of 2018. In addition to the strong results of our combined operations, we continue to make progress on our strategic initiatives. I'll talk more about these recent achievements following Greg's review of the financials. Greg?

Thanks, Tim. Good morning, everyone. I am pleased to share with you the results of another strong quarter for Erie Indemnity. But first, I'd like to take a moment to reflect on our 2019 annual shareholders meeting that was held on April 30. At the meeting, we were able to share the results of our strong performance for 2018 and some initiatives we have planned for 2019 that will help us continue to grow. We are proud of our 2018 results where the Exchange grew its direct and affiliated assumed premiums to over $7 billion, marking the 11th consecutive year of growth, and we delivered earnings per share of $5.51, which is the highest earnings per share in our company's history. While we are proud of our past performance, we remain focused on delivering another strong year of results in 2019. I believe the first quarter results speak to that focus. For the first quarter of 2019, net income was $75 million or $1.44 per diluted share compared to $66 million or $1.26 per diluted share in the first quarter of 2018. Operating income increased $8.6 million or 11% in the first quarter of 2019 compared to the first quarter of 2018 as the growth in total operating revenue outpaced the growth in total operating expenses. Indemnity's management fee revenue for policy issuance and renewal services increased $25 million or 6.2% to $431 million in the first quarter of 2019 compared to the first quarter of 2018. Management fee revenue from administrative services increased $1 million or 6.7% to $14 million in the first quarter of 2019 compared to the prior year period. Turning to indemnity's cost of operations related to policy issuance and renewal services, commissions increased $9 million in the first quarter of 2019 compared to the same…

Thank you, Greg. Erie is well-positioned for sustained profitable growth and we continue to invest in areas that support our strategic direction. I've talked about these four areas in the past. They are the framework for how we're aligning our resources to sustain and accelerate Erie's success in a changing market. The four areas include strengthening our business platforms and use of data, continuing to enhance the Erie experience, identifying and developing new sources of revenue and preparing the workforce of the future. We're making progress in all of four areas. I'd like to share a few highlights from the first quarter. First, we introduced a new service that helps our customers recover faster following personal lines loss. Customers can choose to have an electronic claims payment delivered directly to their bank account in less than an hour. We partnered with PNC Bank and Visa on this service, making Erie one of just a handful of carriers offering e-payments for claims settlement. We believe that fast delivery of a claims payment is a valuable compliment to the caring service provided by our claims team. Secondly, in an additional effort to improve the experience of customers following a loss, we recently piloted a new service for drivers who need transportation from the scene of an auto accident. Our first notice of loss team provided these customers with a virtual debit card to cover temporary travel expenses, including public transportation, a taxicab or ridesharing service, such as Uber or Lyft. Feedback from the pilot was very positive and we're now preparing to expand this service. Claim reporting is a critical touch point in a customers experience, and it's a moment of truth for us, a moment where we can deliver on the promise of service that comes with every Erie policy. Finally,…

Ladies and gentlemen, thank you for participating in today's conference. This concludes today's program. You may all disconnect. Everyone, have a great day. End of Q&A: