Erie Indemnity Co (ERIE) SEC Filing 10-K Annual report for the fiscal year ending Monday, December 31, 2018

Commercial lines - Total commercial lines premiums written increased 7.5% to $2.1 billion in 2018, from $1.9 billion in 2017, driven by a 2.7% increase in total commercial lines policies in force and a 4.6% increase in the total commercial lines year-over-year average premium per policy.

Years ended December 31, (dollars in thousands) % Change % Change Management fee revenue - administrative services, net $ 53,632 N/A % $ - N/A % $ - Administrative services reimbursement revenue 580,336 N/A - N/A - Total revenue allocated to administrative services 633,968 N/A - N/A - Administrative services expenses Claims handling services 505,843 N/A - N/A - Investment management services 32,065 N/A - N/A - Life management services 42,428 N/A - N/A - Operating income - administrative services $ 53,632 N/A % $ - N/A % $ - N/A = not applicable Administrative services We allocate a portion of the management fee, which currently equates to 0.8% of the direct and assumed premiums written by the Exchange, to the administrative services.

Direct and assumed premiums written by the Exchange Personal lines - Total personal lines premiums written increased 6.6% to $5.0 billion in 2018, from $4.7 billion in 2017, driven by an increase of 3.4% in total personal lines policies in force and an increase of 3.3% in the total personal lines year-over-year average premium per policy.

(3) With the adoption of ASC 606 effective January 1, 2018, management fee revenue - administrative services is recognized over time as the services are performed.

(2) The allocation of management fee revenue between the two performance obligations beginning January 1, 2018 caused the growth in management fee revenue - policy issuance and renewal services to not correspond directly with the growth in direct and assumed premiums written by the Exchange in 2018, compared to 2017.