The Board of Directors of the Erie Indemnity Company approved an increase in the regular quarterly shareholder dividend from $0.17 to $0.19 on each Class A share and from $25.50 to $28.50 on each Class B share. The Board also set the management fee rate and service fee rate charged to the Erie Insurance Exchange for 2003. Erie Indemnity is headquartered in Erie, Penn.
The dividend is payable January 20, 2003, to shareholders of record as of January 6, 2003, with a dividend ex-date of January 2, 2003. The dividend increases were a result of the company’s continuing strong financial performance. The rise in the dividend represents an 11.8 percent increase over the current dividend amount.
In a separate action, the Board voted to reduce for 2003 the management fee rate to 24 percent from the current 25 percent rate paid Erie Indemnity Company by the Erie Insurance Exchange. The Board has the authority to change the management fee rate at its discretion, however, the maximum fee rate permissible by agreement is 25 percent. This action was taken after the board’s consideration and review of the relative financial position of the Erie Insurance Exchange and the Erie Indemnity Company.
The company also will reduce the service fee rate paid to Erie Indemnity Company by the Erie Insurance Exchange in 2003 for the management and administration of its voluntary assumed reinsurance business from unaffiliated entities from 7 percent to 6 percent of the assumed voluntary reinsurance premiums.
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