Good morning, and welcome to the Erie Indemnity Company Second 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 second 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 July 25, 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.

Thanks, Scott and thank you everyone for your time today and interest in Erie’s second quarter results. Erie Indemnity performed well over the past three months. As you saw in our press release filed yesterday, Erie Indemnity reported net income of $88 million or $1.68 per diluted share for the quarter that’s over $8 million more in the second quarter in 2018. Greg will talk more about what’s behind that increase. Before he does, I want to share recent highlights for Erie Insurance Exchange, the insurance operation we manage. In the second quarter, premiums grew 5.6% over the prior year to nearly $2 billion. Renewal premium is driving this growth as we continue to experience strong policy retention. The exchanges work continues to exceed Conning's latest industry forecast of 4.1%, this result puts Erie on pace to outperform the industry on premium growth for the 12th year in a row. As we’ve shared on past calls, our long term growth goal is to outpace the industry and grow our market share. The gap between Erie’s premium growth in the industry has slowed over the last two years driven by several factors. First are the market conditions. Prices are softening in private passenger automobile as carriers hold steady on rates or take decreases which [sharpens] shopping activity. Secondly at Erie, we’re slowing down the private passenger auto growth that is not generating a profit. This is an intentional move to show up our competitive position and bolster our ability to provide a competitive rate for the very best risks. It's a move we believe is necessary to stay true to our commitment to steady growth and steady pricing. At the end of the second quarter, policyholder surplus was almost $9 billion compared to $8.6 billion at the end of 2018. The…

Thanks Tim. As Tim mentioned, it was a solid second quarter but this quarter successes go beyond traditional financial measures and can be seen in our award-winning customer service and customer experience. [Indiscernible] responding to catastrophic weather events like those experienced in May or expanding our availability to offer electronic claims payments, we continue to be above all in service. During the second quarter we continue to pilot new claims e-payment capabilities. Today I am proud to say that we have provided all of our auto and property claims adjusters with the ability to offer customers their settlement electronically through a Visa Direct and Zell. The initial feedback has been outstanding and we look forward to the continued satisfaction this capability will provide for our customers. Now I'd like to share with you Erie's financial results. Starting with the second quarter Erie's net income was $88 million or $1.68 per diluted share compared to $80 million or $1.52 per diluted share in the second quarter of 2018. For the first six months of 2019, net income was a $163 million or $3.12 per diluted share compared to $145 million or $2.78 per diluted share in the first half of 2018. Operating income increased 1.3% or $1 million in the second quarter of 2019 compared to the second quarter of 2018. And then we also saw an increase in operating income of 5.7% or $10 million in the first six months of this year compared to the first six months of last year. Management fee revenue from policy issuance and renewal services increased $26 million in the second quarter and $51 million in the first six months of 2019 compared to the same periods in 2018. Driving that change were increases in the direct and assumed premiums written by the exchange,…

Thanks Greg. Our financial foundation is strong, positioning Erie well for continued profitable growth and a bright future. We continue to invest in that future with a focus on four areas; 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 across all four areas. Our recent achievements include further expansion of efforts to strengthen our competitive position and create revenue opportunities. We recently introduced a web-based driver training program designed to reduce motor vehicle accidents among young drivers. Teen drivers in Virginia and Wisconsin are using the program now and earning discounts on their auto insurance premiums. This program compliments our expanding telematics program, which rewards teens for good driving behavior and is on track for introduction to all states as we head into 2020. In our homeowners’ line of business, we're nearing the finish line for converting policies from our legacy home protector program to our web-based Erie secure home platform. This conversion is significant on a number of fronts. It simplifies our agents processes for writing home owners business with Erie. They'll have one platform for this line of business and easy to sell bundles to customize a customer's coverage. The conversion also gets us one step closer to a full online capabilities for personal lines further improving the experience of our agents when it comes to writing and servicing this high-volume line of business. And lastly, with the conversion we're able to offer all of our homeowners, customers industry-leading coverages and protection. I'm very pleased to share that the conversion has gone extremely well for agents and customers alike. We're on track to complete this change in most states by year-end. Finally, I want to…