This document summarizes the first quarter 2005 financial results of Erie Indemnity Company. Key points include: - Net income increased 16.5% to $57.8 million, up from $49.6 million in first quarter 2004. - Management fee revenue grew 3.9% to $230.4 million. - The Property and Casualty Group's direct written premium increased 1.2% to $971.8 million. - Net investment income increased 17.9% to $22.8 million due to higher realized gains and equity earnings.

1. ERIE INDEMNITY COMPANY
2005 FIRST QUARTER
SHAREHOLDERS’ REPORT
The marked improvement in the respective combined property/casualty subsidiaries (collectively, the “Property
ratios of the Property and Casualty Group and the and Casualty Group”) write personal and commercial
Company in the first quarter of 2005 provides a firm lines property/casualty coverages exclusively through
foundation for profitable growth. Moderating pricing as independent agents and pool their underwriting results.
a result of our improved loss experience, combined with The financial position or results of operations of the
initiatives such as our new segmented pricing model, will Exchange are not consolidated with those of the Company.
provide ERIE agents with a wider range of pricing and the
The Company’s earnings are largely generated by fees
Company will be better positioned to attract and retain
based on direct written premiums of the Property and
the very best customers.
Casualty Group, the principal member of which is the
Jeffrey A. Ludrof, Exchange. The Company, therefore, has a direct incentive
President and Chief Executive Officer to protect the financial condition of the Exchange. The
members of the Property and Casualty Group pool their
About Erie Indemnity Company underwriting results. Under the pooling agreement, the
Exchange assumes 94.5% of the pool. Accordingly, the
Erie Indemnity Company (Company) is a Pennsylvania
underwriting risk of the Property and Casualty Group’s
business corporation formed in 1925 to be the attorney-
business is largely borne by the Exchange. Through
in-fact for the Erie Insurance Exchange (Exchange), a
the pool, the Company’s property/casualty subsidiaries
Pennsylvania-domiciled reciprocal insurance exchange.
currently assume 5.5% of the Property and Casualty
As attorney-in-fact, the Company is required to perform
Group’s underwriting results.
certain services relating to the sales, underwriting and
issuance of policies on behalf of the Exchange. For The Property and Casualty Group seeks to insure
its services as attorney-in-fact, the Company charges standard and preferred risks primarily in private
a management fee calculated as a percentage, not passenger automobile, homeowners and small
to exceed 25%, of the direct and affiliated assumed commercial lines, including workers’ compensation. The
premiums written of the Exchange. Property and Casualty Group’s sole distribution channel
is its independent agency force, which consists of more
The Company also operates as a property/casualty insurer
than 1,700 agencies comprised of over 7,600 licensed
through its three insurance subsidiaries. The Exchange and
representatives in 11 midwestern, mid-Atlantic and
its property/casualty subsidiary and the Company’s three
southeastern states, and the District of Columbia.
Erie Insurance Group Organizational Chart

2. Corporate Information
Financial Information Stock Transfer Agent
The Erie Indemnity Company submits a quarterly report American Stock Transfer & Trust Company
to the Securities and Exchange Commission on Form 59 Maiden Lane
10-Q. Shareholders may obtain a copy of the Form 10-Q Plaza Level
report without charge by writing to: Chief Financial New York, NY 10038
Officer, Erie Indemnity Company, 100 Erie Insurance (800) 937-5449
Place, Erie, PA, 16530 or by visiting the Company’s Web
Corporate Headquarters
site at www.erieinsurance.com.
100 Erie Insurance Place
Common Stock Information Erie, PA 16530
The Erie Indemnity Company’s Class A, non-voting (814) 870-2000
common stock is traded on the NASDAQ Stock Market
Internet Address
under the symbol “ERIE.” Quotations are available via
major financial news sources. Financial statement filings, shareholder information, press
releases and general news about the Company may also
be accessed at: www.erieinsurance.com.
Erie Indemnity Company First Quarter 2005 Results
Highlights of the first quarter 2005 results of the Erie percent at March 31, 2004. An emphasis on underwriting
Indemnity Company are as follows: discipline during 2004 resulted in a tapering off in policy
production and reduced policy retention ratios, as
• Net income increased by 16.5 percent to $57.8 million,
anticipated. The Property and Casualty Group continues
up from $49.6 million at March 31, 2004.
to maintain its focus on enhancing quality growth while
• Net income per share increased by 18.5 percent to maintaining underwriting profitability.
$0.83 per share, compared to $.70 per share in the
Management fee revenue was reduced by $.4 million
comparable quarter for 2004.`
and $3.9 million in the first quarters of 2005 and 2004,
• Net management fee revenue grew by 3.9 percent to respectively, due to an increase in the allowance on
$230.4 million, up from $221.9 million for the same mid-term policy cancellations. The methodology used
period one year ago. to estimate the mid-term policy cancellations was
refined in the second quarter of 2004 upon completion
• The Property and Casualty Group’s direct written
of an analysis of the adequacy of the allowance. The
premium grew 1.2 percent to $971.8 million at March 31,
refined methodology decreased the second quarter
2005, from $960.7 million at March 31, 2004.
2004 allowance and increased the second quarter 2004
management fee revenue by $2.8 million.
Management operations
The cost of management operations increased 3.8 percent
Management fee revenue increased by 3.9 percent to
to $177.7 million in the first quarter of 2005, from $171.2
$230.4 million for the quarter ended March 31, 2005,
million for the same period in 2004. Commission costs
compared to $221.9 million for the same period one year
increased 2.7 percent to $126.2 million from $122.9 million
ago. The higher management fee rate in 2005 of 23.75
in the first quarter 2004. Commission costs decreased $5.3
percent resulted in $2.4 million more in management
million in the first quarter of 2005 due to a reduction in
fee revenue for the quarter ended March 31, 2005, or
commercial commission rates, which became effective on
an increase in net income per share-diluted of $.02 per
premiums collected after December 31, 2004. An increase
share. The management fee rate was 23.5 percent in the
in agent bonus expense of $5.4 million resulting from the
first quarter of 2004.
recent improvements in underwriting profitability impacted
The direct written premiums of the Property and commission costs for the first quarter of 2005. First quarter
Casualty Group, upon which management fee revenue is costs of management operations, excluding commissions,
calculated, totaled $971.8 million in the first quarter 2005, increased 6.7 percent to $51.5 million in 2005 from $48.3
compared to $960.7 million in the first quarter 2004, a 1.2 million in 2004.
percent rate of growth in the first quarter of 2005.
Insurance underwriting operations
The year-over-year average written premium per policy
increased by 6.4 percent to $1,066 at March 31, 2005, The Company’s insurance underwriting operations
as compared to $1,002 at March 31, 2004. Year-over- recorded gains of $6.2 million in the first quarter of
year personal lines premium increased 6.4 percent, while 2005 compared to underwriting losses of $1.5 million
commercial lines increased 6.2 percent at March 31, 2005. in the first quarter of 2004. The Company’s share of
New written premium declined by 13.3 percent in the first catastrophe losses totaled $0.3 million and $0.4 million
quarter of 2005. The year-over-year policy retention rate for the three-month periods ended March 31, 2005 and
declined to 88.3 percent at March 31, 2005, from 89.8 2004, respectively. The Property and Casualty Group

3. experienced positive development on losses of prior and 2004, respectively. Private equity and mezzanine
accident years reducing the statutory combined ratio debt limited partnerships generated earnings of $1.1
by 7.9 points and 6.4 points in the first quarters of 2005 million and $.1 million for the three months ended March
and 2004, respectively. The combined ratio, calculated 31, 2005 and 2004, respectively. Real estate limited
in accordance with generally accepted accounting partnerships generated earnings of $1.0 million and $.3
principles, for the Company was 88.4 in the first quarter million in the first quarters of 2005 and 2004, respectively.
2005 compared to 102.9 for the same period in 2004. There were impairment charges of $.6 million and $.1
million on limited partnerships in the first quarters of 2005
The adjusted statutory combined ratio for the Property
and 2004, respectively, related to private equity limited
and Casualty Group for the first quarter 2005 was 81.4,
partnerships.
compared to 95.0 for the first quarter 2004. Prior to the
third quarter 2004, reserve estimates were reviewed Liquidity and capital resources
quarterly but seasonal fluctuations in loss reserves were
Dividends paid to shareholders totaled $20.6 million
previously recognized over the balance of the year. Since
and $13.9 million in the first quarters of 2005 and 2004,
then, seasonal fluctuations in the Property and Casualty
respectively. As part of its capital management program
Group’s underwriting results were recognized in the
in 2004, the Company increased its quarterly shareholders
quarterly results in which they occurred. The first quarter
dividend for 2005 by 51 percent on its Class A common
of the fiscal year typically has the lowest non-catastrophe
stock.
claim volume of the year. Lower claim volume, coupled
with improved underwriting, resulted in seasonally low During the first quarter of 2005, the Company
underwriting losses at March 31, 2005. Underwriting repurchased 285,428 shares of its outstanding Class A
losses are seasonally higher in the second and fourth common stock in conjunction with the stock repurchase
quarters, and as a consequence, the Company’s property/ plan that was authorized in December 2003. The shares
casualty combined ratio generally increases as the year were purchased at a total cost of $14.6 million, or an
progresses. Catastrophe losses resulted in a .5 point average price per share of $51.21.
increase in the first quarter statutory combined ratio of
the Property and Casualty Group compared to .8 points in
catastrophe losses for the same period in 2004.
“Safe Harbor” Statement Under the Private Securities
Investment operations
Litigation Reform Act of 1995: Certain forward-looking
Net revenue from investment operations for the first statements contained herein involve risks and uncertainties. These
quarter of 2005 reflects an increase of 17.9 percent to statements include certain discussions relating to management
fee revenue, cost of management operations, underwriting,
$22.8 million, compared to $19.4 million for the same
premium and investment income volume, business strategies,
period in 2004.
profitability and business relationships and the Company’s other
Net realized gains on investments of $5.5 million were business activities during 2005 and beyond. In some cases, you
recorded during the first quarter 2005 compared to net can identify forward-looking statements by terms such as “may,”
realized gains of $2.9 million for the first quarter 2004. “will,” “should,” “could,” “would,” “expect,” “plan,” “intend,”
“anticipate,” “believe,” “estimate,” “project,” “predict,”
There were impairment charges of $1.5 million included
“potential” and similar expressions. These forward-looking
in net realized gains or losses on fixed maturity and equity
statements reflect the Company’s current views about future
investments in the first quarter of 2005 in the technology
events, are based on assumptions and are subject to known and
and automotive industries. There were no impairment
unknown risks and uncertainties that may cause results to differ
charges on these securities in the first quarter of 2004. materially from those anticipated in those statements. Many of
the factors that will determine future events or achievements are
Equity in earnings of limited partnerships was $2.1 million
beyond our ability to control or predict.
and $.4 million for the quarters ended March 31, 2005

4. CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts in thousands, except per share data)
Three months ended
March 31
2005 2004
(unaudited)
Operating revenue
Management fee revenue—net $ 217,736 $ 209,664
Premiums earned 53,648 50,649
Service agreement revenue 4,787 5,598
Total operating revenue 276,171 265,911
Operating expenses
Cost of management operations 167,940 161,821
Losses and loss adjustment expenses incurred 32,677 38,037
Policy acquisition and other underwriting expenses 11,844 11,318
Total operating expenses 212,461 211,176
Investment income—unaffiliated
Investment income, net of expenses 14,468 14,686
Net realized gains on investments 5,497 2,853
Equity in earnings of limited partnerships 2,111 418
Total investment income—unaffiliated 22,076 17,957
Income before income taxes and equity in earnings of
Erie Family Life Insurance Company 85,786 72,692
Provision for income taxes 28,729 24,435
Equity in earnings of Erie Family Life Insurance
Company, net of tax 714 1,315
Net income $ 57,771 $ 49,572
Net income per share—Class A basic $ 0.91 $ 0.77
Net income per share—Class B basic $ 138.84 $ 117.87
Net income per share—diluted $ 0.83 $ 0.70
Weighted average shares outstanding—diluted 69,846 70,926
Dividends declared per share
Class A common stock $ 0.325 $ 0.215
Class B common stock $ 48.75 $ 32.25

5. CONSOLIDATED STATEMENTS OF OPERATIONS—SEGMENT BASIS
(Amounts in thousands, except per share data)
Three months ended
March 31
2005 2004
(unaudited)
Management operations
Management fee revenue $ 230,409 $ 221,867
Service agreement revenue 4,787 5,598
Total revenue from management operations 235,196 227,465
Cost of management operations 177,714 171,239
Income from management operations 57,482 56,226
Insurance underwriting operations
Premiums earned 53,648 50,649
Losses and loss adjustment expenses incurred 32,677 38,037
Policy acquisition and other underwriting expenses 14,742 14,103
Total losses and expenses 47,419 52,140
Underwriting gain (loss) 6,229 (1,491)
Investment operations
Net investment income 14,468 14,686
Net realized gains on investments 5,497 2,853
Equity in earnings of limited partnerships 2,111 418
Equity in earnings of Erie Family Life Insurance Company 767 1,414
Net revenue from investment operations 22,843 19,371
Income before income taxes 86,554 74,106
Provision for income taxes 28,783 24,534
Net income $ 57,771 $ 49,572
Net income per share—diluted $ 0.83 $ 0.70
Amounts presented on a segment basis are presented gross of intercompany/intersegment items

6. RECONCILIATION OF OPERATING INCOME TO NET INCOME
Definition on Non-GAAP and Operating effects of realized capital gains and losses. These items
Measures may vary significantly between periods and are generally
driven by business decisions and economic developments
Operating income, a non-GAAP measure, is net income such as capital market conditions, the timing of which
excluding realized capital gains and losses and federal is unrelated to management services and insurance
income taxes related to realized capital gains and losses. underwriting processes of the Company. The Company
Realized capital gains and losses which are included in the believes operating income is useful for investors to
Company’s equity in earnings of Erie Family Life Insurance evaluate these components separately and in the
Company and equity in earnings of limited partnerships aggregate when reviewing the Company’s performance.
are not excluded from net income in computing operating The Company is aware that the price to earnings
income. Net income is the GAAP measure that is most multiple commonly used by investors as a forward-
directly comparable to operating income. looking valuation technique uses operating income
as the denominator. Operating income should not be
The Company’s method of calculating this measure may
considered as a substitute for net income and does not
differ from those used by other companies and therefore
reflect the overall profitability of the Company’s business.
comparability may be limited.
The following table reconciles operating income and net
The Company uses operating income to evaluate their
income for the three months ended March 31, 2005 and
results of operations. It reveals trends in the Company’s
2004.
management services, insurance underwriting and
investment operations that may be obscured by the net
Three months ended
March 31
(in thousands) (unaudited)
2005 2004
Operating income $ 54,199 $ 47,718
Net realized gains on investments 5,497 2,853
Income tax expense on realized gains (1,925) (999)
Realized gains net of income tax expense 3,572 1,854
Net income $ 57,771 $ 49,572
Three months ended
March 31
(per share information—diluted) (unaudited)
2005 2004
Operating income $ 0.78 $ 0.67
Net realized gains on investments 0.08 0.04
Income tax expense on realized gains (0.03) (0.01)
Realized gains net of income tax expense 0.05 0.03
Net income $ 0.83 $ 0.70

7. CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
(Amounts in thousands, except per share data)
March 31 December 31
2005 2004
(unaudited)
Assets
Investments
Fixed maturities $ 981,572 $ 974,512
Equity securities
Preferred stock 148,790 143,851
Common stock 60,540 58,843
Other invested assets 137,720 135,508
Total investments 1,328,622 1,312,714
Cash and cash equivalents 53,307 50,061
Equity in Erie Family Life Insurance Company 56,010 58,728
Premiums receivable from policyholders 272,870 275,721
Receivables from affiliates 1,123,900 1,145,238
Other assets 141,896 137,282
Total assets $ 2,976,605 $ 2,979,744
Liabilities and shareholders’ equity
Liabilities
Unpaid losses and loss adjustment expenses $ 942,586 $ 943,034
Unearned premiums 464,154 472,553
Other liabilities 300,675 297,276
Total liabilities 1,707,415 1,712,863
Total shareholders’ equity 1,269,190 1,266,881
Total liabilities and shareholders’ equity $ 2,976,605 $ 2,979,744
Book value per share $ 18.24 $ 18.14
Shares outstanding 69,567 69,852

8. ER ®
ERIE INDEMNITY COMPANY
Member • Erie Insurance Group
An Equal Opportunity Employer
Home Office • 100 Erie Insurance Place • Erie, PA 16530
(814) 870-2000 • www.erieinsurance.com
GF-540 4/05 © 2005 Erie Indemnity Company