922621--2/22/2006--ERIE_INDEMNITY

related topics

{loan, real, estate}

{loss, insurance, financial}

{regulation, change, law}

{operation, natural, condition}

{capital, credit, financial}

{product, market, service}

{personnel, key, retain}

The financial condition of the Company may suffer because of declines in the value of the securities held in the Company s investment portfolio that constitute a significant portion of the Company s assets. The threat of terrorism and other actions may adversely affect the Company s investment portfolio and as a result the Company s net income and shareholder s equity. Risk factors relating to the business of the Property and Casualty Group The Property and Casualty Group faces significant competition from other regional and national insurance companies which may result in lower revenues. If the Erie Insurance Group is unable to keep pace with the rapidly developing technological advancements in the insurance industry or to replace its legacy policy administration systems, the ability of the Property Casualty Group to compete effectively could be impaired. Premium rates and reserves must be established for members of the Property and Casualty Group from forecasts of the ultimate costs expected to arise from risks underwritten during the policy period. The Company s underwriting profitability could be adversely affected to the extent such premium rates or reserves are too low. The financial performance of members of the Property and Casualty Group could be adversely affected by severe weather conditions or other catastrophic losses, including terrorism. The Property and Casualty Group depends on independent insurance agents, which exposes the Property and Casualty Group to risks not applicable to companies with dedicated agents. If there were a failure to maintain a commercially acceptable financial strength rating, the Property and Casualty Group s competitive position in the insurance industry would be adversely affected. Changes in applicable insurance laws, regulations or changes in the way regulators administer those laws or regulations could adversely change the Property and Casualty Group s operating environment and increase its exposure to loss or put it at a competitive disadvantage. The ability of the Company to attract, develop and retain talented employees, managers and executives is critical to the Company s success. Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995:

Full 10-K form ▸

922621--2/22/2006--ERIE_INDEMNITY_CO