Postretirement Benefits (Tables)

12 Months Ended

Dec. 31, 2012

Compensation and Retirement Disclosure [Abstract]

Schedule of cost of pension plans

Cost of pension plans

(in millions)	Erie Insurance Group
	2012			2011			2010
Cost of pension plans:
Service cost for benefits earned	$	21		$	17		$	15
Interest cost on benefit obligation	24			23			21
Expected return on plan assets	(27		)	(27		)	(25		)
Prior service cost amortization	1			1			1
Net actuarial loss amortization	11			6			3
Pension plan cost (1)	$	30		$	20		$	15

(1) Pension plan costs represent the total cost for the Erie Insurance Group before reimbursements to Indemnity from the Exchange and EFL.

Schedule of actuarial assumptions used to measure the year-end benefit obligations and net periodic benefit costs for the subsequent year

Actuarial assumptions

The following table describes the assumptions at December 31 used to measure the year-end benefit obligations and the net periodic benefit costs for the subsequent year:

(in millions)	Erie Insurance Group
	2012		2011		2010		2009
Actuarial assumptions:
Employee pension plan:
Discount rate	4.19	%	4.99	%	5.69	%	6.11	%
Expected return on assets	7.50		8.00		8.00		8.25
Compensation increases (1)	4.15		4.15		4.15		4.15
SERP:
Discount rate – pre-retirement/post-retirement	4.19/3.69		4.99/4.49		5.69/5.19		6.11/5.00
Rate of compensation increase	6.00		6.00		6.00		6.00

(1) The rate of compensation increase for the employee plan is age-graded.  An equivalent single compensation increase rate of 4.15% in 2012, 2011 and 2010 would produce similar results.

Schedule of funded status of pension plans and amounts recognized in the Consolidated Statements of Financial Position

The following table sets forth the funded status of the pension plans and the amounts recognized in the Consolidated Statements of Financial Position as of December 31:

(in millions)	Erie Insurance Group
	2012			2011
Funded status at end of period	$	(201	)	$	(140	)
Pension liability recorded in the Consolidated Statement of Financial Position:
Pension liabilities – due within one year	$	(2	)	$	(1	)
Pension liabilities – due after one year	(199		)	(139		)
Net amount recognized	$	(201	)	$	(140	)

Schedule of change in projected benefit obligation and accumulated benefit obligation

The following tables set forth:  the change in our projected benefit obligation, the accumulated benefit obligation, and information for the defined benefit pension plans with an accumulated benefit obligation in excess of plan assets as of December 31:

(in millions)	Erie Insurance Group
	2012			2011
Projected benefit obligation:
Balance at January 1	$	488		$	400
Service cost for benefits earned	21			17
Interest cost on benefit obligations	24			23
Plan amendments	0			1
Actuarial loss	87			54
Benefits paid	(8		)	(7		)
Balance at December 31	$	612		$	488
Accumulated benefit obligation, December 31,	$	453		$	363

Schedule of defined benefit pension plans with an accumulated benefit obligation in excess of plan assets

(in millions)	Erie Insurance Group
	2012		2011
Plans with assets less than ABO, December 31:
Plan assets	$	411	$	348
Accumulated benefit obligations	453		363
Projected benefit obligations	612		488

Schedule of changes in fair value of plan assets

Pension assets

(in millions)	Erie Insurance Group
	2012			2011
Fair value of plan assets:
Balance at January 1	$	348		$	328
Actual gain on plan assets	55			12
Employer contributions	16			15
Benefits paid	(8		)	(7		)
Balance at December 31	$	411		$	348

Schedule of amounts included in shareholders' equity (unamortized)

Shareholders’ equity

(in millions)	Erie Insurance Group
	2012		2011
Amounts included in shareholders’ equity (unamortized):
Net actuarial loss	$	220	$	173
Prior service cost	6		6
Net amount not yet recognized	$	226	$	179

Schedule of amounts recognized in other comprehensive income for pension plans

Other comprehensive income

(in millions)	Erie Insurance Group
	2012				2011
Amounts recognized in other comprehensive incomefor pension plans:
Amortization of net actuarial loss	$	(11	)		$	(6	)
Amortization of prior service cost	(1		)		(1		)
Net actuarial loss arising during the year	59				69
Amendments	0			(1)	1			(2)
Total recognized in other comprehensive income	$	47			$	63

(1) The charges recognized as amendments were the result of factoring in the prior service cost for one new plan participant in 2012.

(2) The charges recognized as amendments were the result of factoring in the prior service cost for seven new plan participants in 2011.

Schedule of target and actual asset allocations for the portfolio

The target and actual asset allocation for the portfolio is as follows for the years ended December 31:

	Erie Insurance Group
	Target asset allocation		Actual asset allocation		Actual asset allocation
Asset allocation:	2011-2012		2012		2011
Equity securities:
U.S. equity securities (1)	40	%	41	%	41	%
Non-U.S. equity securities (2)	20		21		19
Total equity securities	60		62		60
Debt securities (3)	39		37		39
Other (4)	1		1		1
Total	100	%	100	%	100	%

(1) For the U.S. equity securities 20% seek to achieve excess returns relative to the Russell 2000 Index while 39% seek to achieve excess returns relative to the S&P 500.  The remaining 41% of the allocation to U.S. equity securities are comprised of equity index funds that track the S&P 500.

(2) For the Non-U.S. equity securities, 11% are allocated to international small cap investments while another 11% are allocated to international emerging market investments.  The remaining 78% of the Non-U.S. equity securities are allocated to investments seeking to achieve excess returns relative to an international market index.

(3) For the debt securities, 50% are allocated to investment-grade fixed income securities while the remaining 50% are allocated to U.S. corporate bonds with an emphasis on long duration bonds rated A or better.

(4) Institutional money market fund.

Schedule of fair value measurements of pension plan assets by major category and level of input

The following tables represent the fair value measurements for the pension plan assets by major category and level of input:

	Erie Insurance Group
	At December 31, 2012
	Fair value measurements of plan assets using:
(in millions)	Total		Quoted prices in active markets for identical assets Level 1		Significant observable inputs Level 2		Significant unobservable inputs Level 3
Equity securities:
U.S. equity securities	$	168	$	0	$	168	$	0
Non-U.S. equity securities	87		0		87		0
Total equity securities	255		0		255		0
Debt securities – U.S. fixed income	153		0		153		0
Other	3		3		0		0
Total	$	411	$	3	$	408	$	0

	Erie Insurance Group
	At December 31, 2011
	Fair value measurements of plan assets using:
(in millions)	Total		Quoted prices in active markets for identical assets Level 1		Significant observable inputs Level 2		Significant unobservable inputs Level 3
Equity securities:
U.S. equity securities	$	140	$	0	$	140	$	0
Non-U.S. equity securities	68		0		68		0
Total equity securities	208		0		208		0
Debt securities – U.S. fixed income	138		0		138		0
Other	2		2		0		0
Total	$	348	$	2	$	346	$	0

Schedule of benefits expected to be paid over the next 10 years from pension and other postretirement plans

The following table sets forth amounts of benefits expected to be paid over the next 10 years from our pension and other postretirement plans as of December 31:

(in millions)	Erie Insurance Group
Year ending December 31,	Expected future cash flows
2013	$	12
2014	11
2015	13
2016	15
2017	17
2018 - 2022	123