UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
    ACT OF 1934

For the quarterly period ended June 30, 2000

                                      OR

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
    ACT OF 1934

For the transition period from ______ to ______

                    Commission file number 2-39458

                   ERIE FAMILY LIFE INSURANCE COMPANY
          (Exact name of registrant as specified in its charter)

             PENNSYLVANIA                                 25-1186315
  (State or other jurisdiction of                        (I.R.S. Employer
  incorporation or organization)                          Identification No.)


100 Erie Insurance Place, Erie, Pennsylvania                     16530
  (Address of principal executive offices)                     (Zip Code)

Registrant's telephone number, including area code   (814) 870-2000


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding  12 months  (or for  such  shorter period that the registrant was
required  to file  such  reports), and  (2)  has  been  subject  to  such filing
requirements for the past 90 days.

        Yes  X        No ___


Indicate the number of shares outstanding of each of the Registrant's classes of
common stock, as  of the latest  practicable  date:  9,450,000  shares of Common
Stock outstanding on July 28, 2000.


                                       1
<PAGE>


                             INDEX

                ERIE FAMILY LIFE INSURANCE COMPANY


PART I. FINANCIAL INFORMATION

Item 1. Financial Statements (Unaudited)

        Statements of Financial Position-June 30, 2000 and December 31, 1999

        Statements of Operations-Three and six months ended June 30, 2000 and
        1999

        Statements of Comprehensive Income-Three and six months ended June 30,
        2000 and 1999

        Statements of Cash Flows-Six months ended June 30, 2000 and 1999

        Notes to Financial Statements-June 30, 2000

Item 2. Management's Discussion and Analysis of Financial Condition and Results
        of Operations


PART II. OTHER INFORMATION

Item 6. Exhibits and Reports on Form 8-K


SIGNATURES


                                       2
<PAGE>


PART I.  FINANCIAL INFORMATION

                             ERIE FAMILY LIFE INSURANCE COMPANY

                              STATEMENTS OF FINANCIAL POSITION
<TABLE>
<CAPTION>

                                                                                     (Dollars in thousands)
                                                                                 June 30,           December 31,
ASSETS                                                                             2000                 1999
                                                                                ----------           ----------
                                                                               (Unaudited)
<S>                                                                             <C>                  <C>
Investments:
      Fixed Maturities at fair value (amortized cost
        of $686,838 and $651,659, respectively)                                 $ 657,082            $ 628,877
      Equity Securities at fair value
        (cost of $128,388 and $124,674, respectively)                             150,868              142,095
      Real Estate                                                                   1,417                1,458
      Policy Loans                                                                  7,252                6,724
      Real Estate Mortgage Loans                                                    8,381                9,975
      Other Invested Assets                                                        43,421               28,331
                                                                                ---------            ---------
        Total Invested Assets                                                   $ 868,421            $ 817,460

      Cash and Cash Equivalents                                                     5,937               27,358
      Premiums Receivable from Policyholders                                        4,302                4,056
      Reinsurance Recoverable                                                         318                  464
      Other Receivables                                                                93                  171
      Accrued Investment Income                                                    12,065               10,896
      Deferred Policy Acquisition Costs                                            79,742               77,588
      Reserve Credit for Reinsurance Ceded                                          7,316                6,927
      Prepaid Federal Income Taxes                                                  2,381                  758
      Other Assets                                                                  9,160                8,854
                                                                                ---------            ---------
        Total Assets                                                            $ 989,735            $ 954,532
                                                                                =========            =========

<FN>
See notes to financial statements.
</FN>
</TABLE>


                                       3
<PAGE>


                             ERIE FAMILY LIFE INSURANCE COMPANY

                              STATEMENTS OF FINANCIAL POSITION
<TABLE>
<CAPTION>

                                                                                     (Dollars in thousands)
                                                                                 June 30,           December 31,
                                                                                   2000                1999
                                                                                ----------          -----------
LIABILITIES AND SHAREHOLDERS' EQUITY                                            (Unaudited)
<S>                                                                             <C>                  <C>
Liabilities:
      Policy Liabilities and Accruals:
        Future Life Policy Benefits                                             $  73,341             $  70,329
       Policy and Contract Claims                                                   2,509                 1,305
        Annuity Deposits                                                          572,694               569,218
        Universal Life Deposits                                                   101,121                94,640
        Supplementary Contracts Not
          Including Life Contingencies                                                586                   581
      Other Policyholder Funds                                                      5,029                 5,623
      Deferred Income Taxes                                                        22,995                17,853
      Reinsurance Premium Due                                                         374                   692
      Accounts Payable and Accrued Expenses                                         4,595                 5,116
      Note Payable to Erie Indemnity Company                                       15,000                15,000
      Due to Affiliate                                                              2,345                 1,513
      Dividends Payable                                                             3,402                 1,559
                                                                                ---------             ---------
        Total Liabilities                                                       $ 803,991             $ 783,429
                                                                                ---------             ---------
Shareholders' Equity:
      Common Stock, $.40 Par Value Per Share;
        Authorized 15,000,000 Shares; 9,450,000
        Shares Issued and Outstanding                                           $   3,780             $   3,780
      Additional Paid-In Capital                                                      630                   630
      Accumulated Other Comprehensive Income (Loss)                                 5,014            (    2,344)
      Retained Earnings                                                           176,320               169,037
                                                                                ---------             ---------
        Total Shareholders' Equity                                              $ 185,744             $ 171,103
                                                                                ---------             ---------
        Total Liabilities and Shareholders' Equity                              $ 989,735             $ 954,532
                                                                                =========             =========

<FN>
See notes to financial statements.
</FN>
</TABLE>


                                       4
<PAGE>


                             ERIE FAMILY LIFE INSURANCE COMPANY

                             STATEMENTS OF OPERATIONS (Unaudited)
<TABLE>
<CAPTION>
                                                                              (Dollars in thousands, except per share data)
                                                                      Three Months Ended                         Six Months Ended
                                                                            June 30                                  June 30
                                                                  ---------------------------             --------------------------
                                                                       2000             1999                  2000             1999
<S>                                                               <C>               <C>                   <C>              <C>
Revenues:
   Policy:
   Life Premiums, net of premiums ceded of
     $1,200, $763, $2,103 and
     $1,496, respectively                                         $ 10,986          $ 10,350              $ 20,783         $ 19,571
   Group Premiums                                                      657               628                 1,332            1,250
                                                                  --------          --------              --------         --------
       Total Policy Revenue                                       $ 11,643          $ 10,978              $ 22,115         $ 20,821

   Investment Income, net of expenses of
     $454, $459, $917 and
     $868, respectively                                             16,365            13,930                32,100           27,300
   Net Realized Gains on Investments                                 1,603             1,826                 3,852            2,651
   Other Income                                                        211               135                   515              373
                                                                  --------          --------              --------         --------
       Total Revenues                                             $ 29,822          $ 26,869              $ 58,582         $ 51,145
                                                                  ========          ========              ========         ========
Benefits and Expenses:
   Death Benefits, net of reinsurance recoveries
     of $263, $135, $1,285 and
     $761, respectively                                           $  3,444          $  2,670              $  6,170         $  5,231
   Interest on Annuity Deposits                                      8,331             8,033                16,883           15,337
   Interest on Universal Life Deposits                               1,510             1,254                 2,968            2,529
   Surrender and Other Benefits                                        271               262                   546              544
   Increase in Future Life Policy Benefits, net of
     the increase in reserve credit for reinsurance
     ceded of $256, $222, $389 and
     $393, respectively                                              1,529             1,163                 2,623            2,321
   Amortization of Deferred Policy Acquisition Costs                 2,456             1,410                 3,933            3,004
   Commissions, net of reinsurance reimbursements
     of $545, $202, $924 and $416, respectively                        225               535                   702            1,068
   General Expenses                                                  2,502             1,797                 4,720            3,533
   Taxes, Licenses and Fees                                            563               405                 1,097              806
                                                                  --------          --------              --------         --------
       Total Benefits and Expenses                                $ 20,831          $ 17,529              $ 39,642         $ 34,373
                                                                  --------          --------              --------         --------
Income From Operations                                            $  8,991          $  9,340              $ 18,940         $ 16,772
Provision for Federal Income Taxes:
   Current                                                           2,404             2,691                 5,380            4,997
   Deferred                                                            707               770                 1,173            1,015
                                                                  --------          --------              --------         --------
       Total Provision for Federal Income Taxes                      3,111             3,461                 6,553            6,012
                                                                  --------          --------              --------         --------
Net Income                                                        $  5,880          $  5,879              $ 12,387         $ 10,760
                                                                  ========          ========              ========         ========
Net Income Per Share                                              $   0.62          $   0.62              $   1.31         $   1.14
                                                                  ========          ========              ========         ========
Dividends Declared Per Share                                      $   0.36          $   0.33              $   0.54         $   0.50
                                                                  ========          ========              ========         ========

<FN>
See notes to financial statements.
</FN>
</TABLE>


                                       5
<PAGE>


                             ERIE FAMILY LIFE INSURANCE COMPANY

                       STATEMENTS OF COMPREHENSIVE INCOME (Unaudited)
<TABLE>
<CAPTION>

                                                                                         (Dollars in Thousands)
                                                                       Three Months Ended                      Six Months Ended
                                                                            June 30                                June 30
                                                                  --------------------------             ---------------------------
                                                                       2000             1999                  2000           1999
<S>                                                               <C>               <C>                   <C>             <C>
Net Income                                                         $ 5,880           $  5,879              $ 12,387        $ 10,760
                                                                   -------           --------              --------        --------
Unrealized (Losses) Gains on Securities:
   Unrealized Holding (Losses) Gains Arising
     During Period                                                (  7,229)         (  14,650)               15,173       (  24,544)
   Less:  Reclassification Adjustment for Gains
     Included in Net Income                                       (  1,603)         (   1,826)            (   3,852)      (   2,651)
                                                                   -------           --------              --------        --------
     Net Unrealized Holding (Losses) Gains
       Arising During Period                                      ($ 8,832)         ($ 16,476)             $ 11,321       ($ 27,195)
                                                                   -------           --------              --------        --------

Income Tax Benefit (Expense) Related to
   Unrealized (Losses) Gains                                         3,091              5,767             (   3,963)          9,518
                                                                   -------           --------              --------        --------

Other Comprehensive (Loss) Income, Net of Tax                     ($ 5,741)         ($ 10,709)             $  7,358       ($ 17,677)
                                                                   -------           --------              --------        --------

Comprehensive Income (Loss)                                        $   139          ($  4,830)             $ 19,745       ($  6,917)
                                                                   =======           ========              ========        ========

<FN>
See notes to financial statements.
</FN>
</TABLE>


                                       6
<PAGE>


                             ERIE FAMILY LIFE INSURANCE COMPANY

                            STATEMENTS OF CASH FLOWS (Unaudited)
<TABLE>
<CAPTION>

                                                                                    (Dollars in Thousands)
                                                                           Six Months Ended       Six Months Ended
                                                                             June 30, 2000          June 30, 1999
                                                                           ----------------       ----------------
<S>                                                                             <C>                  <C>
Cash flows from operating activities:
Net income                                                                       $ 12,387             $  10,760
Adjustments to reconcile net income to net cash
   provided by operating activities:
     Net amortization of bond and mortgage premium                                    107                   141
     Amortization of deferred policy acquisition costs                              3,933                 3,004
     Real estate depreciation                                                          41                    41
     Deferred federal income taxes                                                  1,173                 1,015
     Realized gains on investments                                              (   3,852)           (    2,651)
(Increase) decrease in premiums receivable                                      (     246)                   15
Decrease in other receivables                                                          78                   166
Increase in accrued investment income                                           (   1,169)           (      638)
Policy acquisition costs deferred                                               (   6,087)           (    6,503)
Increase in other assets                                                        (     306)           (    1,211)
(Increase) decrease in reinsurance recoverables
   and reserve credits                                                          (     243)                   25
Increase in future policy benefits and claims                                       4,216                 2,109
Decrease in other policyholder funds                                            (     594)           (    2,496)
(Decrease) increase in reinsurance premium due                                  (     318)                   25
Decrease in federal income taxes payable                                        (   1,623)           (    1,477)
Increase in accounts payable and due to affiliate                                     312                   253
                                                                                 --------             ---------
       Net cash provided by operating activities                                 $  7,809             $   2,578
                                                                                 --------             ---------
Cash flows from investing activities:
Purchase of investments:
   Fixed maturities                                                             ($ 60,507)           ($ 115,055)
   Equity securities                                                            (  18,817)           (   36,302)
   Mortgage loans                                                                       0            (       66)
   Other invested assets                                                        (   3,751)           (    3,409)
Sales/maturities of investments:
   Fixed maturities                                                                28,905                58,515
   Equity securities                                                               15,269                22,283
   Other invested assets                                                            1,903                 1,267
Principal payments received on mortgage loans                                       1,594                    74
Loans made to policyholders                                                     (   1,118)           (      719)
Payments received on policy loans                                                     590                   409
                                                                                 --------             ---------
       Net cash used in investing activities                                    ($ 35,932)           ($  73,003)
                                                                                 --------             ---------

<FN>
See notes to financial statements.
</FN>
</TABLE>


                                       7

<PAGE>


                             ERIE FAMILY LIFE INSURANCE COMPANY

                        STATEMENTS OF CASH FLOWS (Unaudited) (Continued)
<TABLE>
<CAPTION>


                                                                                    (Dollars in Thousands)
                                                                           Six Months Ended       Six Months Ended
                                                                             June 30, 2000          June 30, 1999
                                                                            ---------------        ---------------
<S>                                                                             <C>                  <C>
Cash flows from financing activities:
Increase in annuity and supplementary contracts                                  $  3,481             $ 22,907
Increase in universal life deposits                                                 6,481                6,571
Dividends paid to shareholders                                                  (   3,260)           (   2,977)
                                                                                 --------             --------
       Net cash provided by financing activities                                 $  6,702             $ 26,501
                                                                                 --------              -------
Net decrease in cash and cash equivalents                                       (  21,421)           (  43,924)
Cash and cash equivalents at beginning of year                                     27,358               44,808
                                                                                 --------             --------
Cash and cash equivalents at end of quarter                                      $  5,937             $    884
                                                                                 ========             ========
Supplemental disclosures of cash flow information:
Cash paid during the year for:
   Interest                                                                      $    596             $    597
   Income taxes                                                                     6,900                6,325


<FN>
See notes to financial statements.
</FN>
</TABLE>


                                       8
<PAGE>


                       ERIE FAMILY LIFE INSURANCE COMPANY

                    NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
        All amounts are in thousands of dollars,  except per share data.

NOTE A -- BASIS OF PRESENTATION

The accompanying unaudited financial statements have been prepared in accordance
with generally accepted accounting  principles for interim financial information
and with  the  instructions  to Form  10-Q and  Rule  10-01 of  Regulation  S-X.
Accordingly,  they do not include all of the information and footnotes  required
by generally accepted accounting  principles for complete financial  statements.
In the opinion of management,  all adjustments  (consisting of normal  recurring
accruals)  considered  necessary  for a fair  presentation  have been  included.
Operating  results  for  the  six-month  period  ended  June  30,  2000  are not
necessarily  indicative  of the results that may be expected for the year ending
December 31, 2000. For further  information,  refer to the financial  statements
and footnotes  thereto  included in the Company's annual report on Form 10-K for
the year ended December 31, 1999.

NOTE B -- INVESTMENTS

Management  considers all fixed  maturities  and  marketable  equity  securities
available-for-sale. Marketable equity securities consist primarily of common and
non-redeemable  preferred stock while fixed maturities  consist of bonds,  notes
and redeemable preferred stock. Available-for-sale securities are stated at fair
value, with the unrealized gains and losses,  net of tax, reported as a separate
component  of  shareholders'  equity.   Management  determines  the  appropriate
classification  of fixed maturities at the time of purchase and reevaluates such
designation as of each statement of financial position date.

The following is a summary of available-for-sale securities:

<TABLE>
<CAPTION>

                                                                       Gross             Gross
                                                 Amortized          Unrealized         Unrealized           Estimated
                                                    Cost               Gains             Losses            Fair Value
<S>                                              <C>                 <C>                <C>                 <C>
June 30, 2000
Fixed Maturities:
U.S. Treasuries and Government
   Agencies                                      $  12,122           $    276           $     75            $  12,323
States and Political Subdivisions                      195                  8                  0                  203
Special Revenue                                      9,500                221                  0                9,721
Public Utilities                                    61,802                587              2,864               59,525
U.S. Banks, Trusts and Insurance
   Companies                                       115,632                392              5,769              110,255
U.S. Industrial and Miscellaneous                  416,202              1,788             18,490              399,500
Foreign Governments-Agency                           2,992                  0                108                2,884
Foreign Banks, Trusts and Insurance
   Companies                                         9,981                  0                735                9,246
Foreign Industrial and Miscellaneous                52,748                184              5,193               47,739
                                                 ---------           --------           --------            ---------
     Total Bonds                                 $ 681,174           $  3,456           $ 33,234            $ 651,396
Redeemable Preferred Stock                           5,664                 47                 25                5,686
                                                 ---------           --------           --------            ---------
Total Fixed Maturities                           $ 686,838           $  3,503           $ 33,259            $ 657,082
                                                 ---------           --------           --------            ---------
Equity Securities:
Common Stock                                     $  66,038           $ 33,321           $  6,730            $  92,629
Non-Redeemable Preferred Stock                      62,350                290              4,401               58,239
                                                 ---------           --------           --------            ---------
     Total Equity Securities                     $ 128,388           $ 33,611           $ 11,131            $ 150,868
                                                 ---------           --------           --------            ---------
       Total Available-for-Sale Securities       $ 815,226           $ 37,114           $ 44,390            $ 807,950
                                                 =========           ========           ========            =========
</TABLE>


                                       9
<PAGE>


                       ERIE FAMILY LIFE INSURANCE COMPANY

                    NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (Continued)

If management  determines that any declines in market value of these investments
are other than temporary,  the securities will be written-down to the realizable
value and reflected in income.  If a bond is in default of interest payments and
it is determined that liquidation of the security would be in the Company's best
interest,  the security will be sold to return the proceeds to income  producing
assets.

Real estate  investments are carried on the Statements of Financial  Position at
cost, less allowances for depreciation and possible losses.  Commercial mortgage
loans  on real  estate  are  carried  at their  unpaid  balances,  adjusted  for
amortization  of premium or discount,  less allowances for possible loan losses.
Policy loans are carried at their unpaid balances. Other invested assets include
investments in U.S.  domestic and foreign private equity and real estate limited
partnerships.  The  private  equity  limited  partnerships  are carried at their
equity in the estimated  market values.  At June 30, 2000 and December 31, 1999,
net unrealized gains on private equity limited partnerships totaled $9.9 million
and $1.2  million,  respectively,  net of  deferred  taxes.  These  amounts  are
included in total shareholders' equity as accumulated other comprehensive income
(loss).  Real estate limited  partnerships are recorded using the equity method,
which  approximates the Company's share of the carrying value of the real estate
investments held by the partnerships.

The fair values of the Company's  investments  in real estate,  mortgage  loans,
policy loans, and other invested assets, approximate the values presented in the
financial statements.

NOTE C - SEGMENT AND PREMIUM INFORMATION

The  Company  offers a range of  products  and  services,  but  operates  as one
reportable  life insurance  segment.  The Company's  portfolio of life insurance
includes  permanent  life,  endowment and term policies,  including  whole life,
mortgage and decreasing term, group, and universal life insurance.

The  following  is a detail of life  premiums  and  annuity and  universal  life
deposits by major product grouping.

<TABLE>
<CAPTION>
                                                      Three Months Ended                    Six Months Ended
                                                           June 30                               June 30
                                                 ----------------------------           --------------------------
                                                   2000                1999               2000              1999
   <S>                                           <C>                 <C>                <C>               <C>
   Life insurance premiums earned:

     Term                                        $  7,910            $  7,187           $ 14,555          $ 13,320
     Whole life                                     1,465               1,349              2,744             2,539
     Universal life                                 2,811               2,573              5,587             5,204
     Other                                            657                 631              1,332             1,254
                                                 --------            --------           --------          --------
         Total direct premiums earned            $ 12,843            $ 11,740           $ 24,218          $ 22,317
     Reinsurance, net                               1,200                 763              2,103             1,496
                                                 --------            --------           --------          --------
   Total policy revenue                          $ 11,643            $ 10,977           $ 22,115          $ 20,821
                                                 ========            ========           ========          ========
   Deposits:
     Universal life                              $  2,936            $  2,992           $  5,713          $  5,917
     Annuity                                       12,577              16,833             24,357            35,060
                                                 --------            --------           --------          --------
         Total deposits                          $ 15,513            $ 19,825           $ 30,070          $ 40,977
                                                 ========            ========           ========          ========
</TABLE>


NOTE D -- GEOGRAPHIC EXPANSION

On March 7, 2000, the  Erie  Insurance  Group, of which the Company is a member,
announced  its  intention  to  expand  its  marketing  territory into Wisconsin.
Wisconsin will be  the  tenth  state  served by the Company,  in addition to the
District of Columbia.  In  Wisconsin, the  Company intends to write all lines of
life and annuity products it currently offers.


                                       10
<PAGE>


ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS

The following  discussion and analysis  should be read in  conjunction  with the
financial  statements  and related notes found on pages 3 through 10, since they
contain  important  information  that is helpful  in  evaluating  the  Company's
operating results and financial condition.

FINANCIAL OVERVIEW

Net income  increased  slightly to $5,880,107,  or $.62 per share, in the second
quarter of 2000,  compared  to  $5,878,689,  or $.62 per  share,  for the second
quarter of 1999.  Strong  investment  gains and  continued  premium  growth were
offset by an  increase  in total  benefits  and  expenses,  contributing  to the
financial  results in 2000.  Net income for the six months  ended June 30,  2000
increased 15.1% to $12,386,531,  or $1.31 per share, compared to $10,760,368, or
$1.14 per share for the same period in 1999.

REVENUES

Analysis of Policy Revenue

Total policy revenue increased  $665,089,  or 6.1%, to $11,642,917 in the second
quarter of 2000.  Contributing  to this  growth was an  increase  in premiums on
universal  life  insurance  policies of 9.2% to $2,810,516 for the quarter ended
June 30, 2000.  Total  policies in force on universal  life  insurance  products
increased  4.1% to 41,415 at June 30, 2000  compared to 39,767  policies at June
30, 1999. Total policy revenue increased $1,293,581, or 6.2%, to $22,114,919 for
the six months ended June 30, 2000.

During 1999, the Company introduced a new life insurance product:  ERIE Flagship
Term.  This new term  insurance  product is designed for sale of face amounts of
$300,000 and above and complements the Company's Term Protector series. This new
product  contributed  $506,888 to total life  premiums  for the six months ended
June 30, 2000.

Because  this new term  product is more  competitively  priced  for larger  face
amounts,  the Company's  reinsurance  premiums ceded and related  commission and
expense  allowances have increased during 2000. The net retention amount on this
product,  however,  is the same as the other traditional life insurance policies
the Company  currently  offers.  Reinsurance  premiums ceded related to the ERIE
Flagship  Term product  amounted to $304,456 for the quarter ended June 30, 2000
and $399,409 for the first six months of 2000.

Analysis of Investment-related Income

Net investment income increased  $2,435,584,  or 17.5%, in the second quarter of
2000 due to  increased  levels of  investment  from cash flows  generated by the
Company's operations and by cash from universal life deposits.  In  addition,  a
distribution of $974,591 was received from a limited partnership investment. For
the six  months ended June 30, 2000, net investment income increased $4,799,764,
or 17.6%.

Net  realized  gains  from the sale of  equity  and fixed  maturity  investments
decreased  12.2% to  $1,603,260  in the  second  quarter  of 2000,  compared  to
$1,825,791 in the second quarter of 1999.  Total invested  assets of the Company
were  $868,421,184 at June 30, 2000, an increase of  $50,961,303,  or 6.2%, over
the December 31, 1999 levels.

BENEFITS AND EXPENSES

Analysis of Policy-related Benefits and Expenses

Net death  benefits on  life  insurance policies increased $774,295, or 29.0% in
the  second  quarter  of  2000  to $3,444,421. For the six months ended June 30,
2000, death benefits on life insurance policies  increased  $938,834, or 18%, to
$6,170,201.


                                       11
<PAGE>


ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS (Continued)

Random  fluctuations  in death benefits  incurred can be expected when mortality
results are measured  over a short time period due to the small number of claims
involved.

These short-term  fluctuations can influence quarterly or annual results without
impacting  long-term  profitability.  Management  believes that its underwriting
philosophy and practices are sound.

Interest expense incurred on deposits increased 6.0% to $9,840,756 in the second
quarter of 2000,  from  $9,287,893  in the second  quarter of 1999.  For the six
months  ended June 30, 2000,  interest  expense  incurred on deposits  increased
$1,985,312  or 11.1%.  The  increase  in  interest  expense was the result of an
increase in the  credited  interest  rate on annuity  deposits  during the first
quarter of 2000 combined with the  $38,820,978  increase in deposits at June 30,
2000 when  compared to June 30, 1999.  The interest  rate  credited on universal
life deposits ranges from 6.0% to 6.75% in 2000 and 1999 while the rate credited
on annuity  deposits in 2000 increased to a range of 5.25% to 6.25% from 5.0% to
5.75% in 1999.

The liability for future life policy  benefits is computed  considering  various
factors such as anticipated mortality, future investment yields, withdrawals and
anticipated  credit for reinsurance.  The second quarter 2000 future life policy
benefit expenses were  $1,529,101,  compared to $1,163,242 in the second quarter
of 1999,  an increase of 31.5%.  For the six months  ended June 30,  2000,  life
policy benefits increased $302,078 or 13.0%.

Amortization of deferred policy  acquisition costs increased 74.2% to $2,455,607
in the second  quarter  of 2000.  For the six months  ended June 30,  2000,  the
increase in amortization of deferred policy  acquisition costs was $929,558,  or
31.0%. The increase is due to utilizing updated  projection  assumptions to more
closely reflect actual experience.

Analysis of Other Expenses

Total operating expenses,  excluding taxes, licenses and fees increased 16.9% to
$2,726,807 at June 30, 2000  compared to  $2,332,109  at June 30, 1999.  Certain
operating  expenses of the Company are paid by the Erie Indemnity  Company,  the
management Company of the Erie Insurance Exchange, and reimbursed monthly by the
Company.  Additionally,  a portion of the Erie Insurance  Group common  overhead
expenses attributed to the Company are also reimbursed  monthly.  These expenses
comprise the majority of the Company's general expenses.

General expenses include wages and salaries,  Employee benefits, data processing
expenses,  occupancy  expenses  and  other  office  and  general  administrative
expenses of the Company. Certain general expenses of the Company, related to the
acquisition and underwriting of new policies, are deferred as policy acquisition
costs.  Medical  inspection  and exam fees related to new  business  production,
wages, salaries and Employee benefits of underwriting  personnel,  and salaries,
employee  benefits and bonuses paid to branch sales Employees for the production
of life and annuity business, are all deferred.

General expenses,  net of deferred policy acquisition costs,  increased $705,558
or 39.2% to $2,502,376  for the quarter ended June 30, 2000.  For the six months
ended June 30, 2000,  net general  expenses  increased  $1,187,275 or 33.6%,  to
$4,720,441.  During 1999,  certain  expenses,  including  salaries and benefits,
associated  with  the  implementation  of the  Company's  policy  administration
system,  CyberLife,  were  capitalized in accordance with SOP 98-1 and therefore
not charged against income in 1999. The  capitalization  of these costs ended in
1999 when the system was placed into use.  These  expenses are now being charged
against  income.  In  addition,  amortization  of the  capitalized  costs of the
CyberLife system began in late 1999, when the system was  placed  into use.  The
amortization  costs for the quarter  ended June 30, 2000 was $62,365.  Excluding
the effect of the 1999 capitalized costs and current year amortization,  general
expenses for the second quarter 2000 would have increased  15.0% from the second
quarter 1999.  The  remaining  quarterly  increase is due to increased  staffing
levels and consulting fees when compared to the same period in 1999. For the six
months  ended June 30,  2000,  the  increase,  excluding  the effect of the 1999
capitalized costs, would have been 8.5%.

Another component  of  total  operating  expenses is commissions to  independent
Agents.  Direct commission costs include new and renewal commissions, production
bonuses and promotional incentives to Agents.


                                       12
<PAGE>


ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS (Continued)

These direct  commission  expenses are reported on the  Statements of Operations
net of  commissions  received  from  reinsurers.  The  reported  expense is also
affected by the amount of commission  expenses  capitalized  as deferred  policy
acquisition costs (DAC). Commissions,  which vary with and are related primarily
to the  production of new business,  have been deferred and are  capitalized  as
DAC. Most first-year and incentive commissions and some second-year  commissions
qualify  for  deferral  as DAC.  During the second  quarter of 2000,  commission
expense decreased $310,860 to $224,431,  compared to the second quarter of 1999.
For the six months ended June 30, 2000, commission expense decreased $366,238 to
$701,589.  A portion of this decrease is the result of a decrease in promotional
incentive costs to Agents for the Company's  participation  in an Erie Insurance
Group promotion,  that ended in August 1999. Also, for the six months ended June
30, 2000,  the  commission  allowance  received  from  reinsurers  has increased
$507,190 to $923,507, due primarily to the introduction of the new ERIE Flagship
Term  product in 2000.  These  plans  provide a greater  commission  and expense
allowance on new business than traditional plans have in the past.

Taxes, licenses and fees increased $158,503 to $563,199 in the second quarter of
2000  compared  to $404,696  in the second  quarter of 1999.  For the six months
ended June 30, 2000, these expenses increased $291,560, or 36.2%, to $1,097,140,
compared to $805,580  for the six months  ended June 30, 1999. A portion of this
is the result of an  increase in state  premium  tax  expense  due to  increased
premium volume and decreased guarantee association tax credits allowed to offset
premium  tax  expenses.  The  remaining  increase is due  primarily  to a second
quarter 2000 refund of premium tax reimbursements  collected from a reinsurer in
prior years.

FINANCIAL CONDITION

Reserve Liabilities

The Company's primary commitment is its obligation to meet the payment of future
policy benefits under the terms of its life insurance and annuity contracts.  To
meet these future  obligations,  the Company establishes life insurance reserves
based upon the type of policy,  the age of the insured,  and the number of years
the policy has been in force. The Company also establishes annuity and universal
life reserves  based on the amount of  Policyholder  deposits  (less  applicable
policy charges) plus interest earned on those deposits.  On June 30, 2000, there
was no  material  difference  between the  carrying  value and fair value of the
Company's  investment-type  policies.  These life insurance and annuity reserves
are supported primarily by the Company's long-term, fixed-income investments, as
the underlying policy reserves are generally also of a long-term nature.

Investments

The Company's  investment  strategies are designed and portfolios are structured
to match the features of the life  insurance  and annuity  products  sold by the
Company.   Annuities  and  life  insurance  policies  are  long-term   products,
therefore,  the  Company's  investment  strategy  takes a long-term  perspective
emphasizing  investment  quality,   diversification,   and  superior  investment
returns.  The  Company's  investments  are managed  prudently  on a total return
approach that focuses on current  income and capital  appreciation.  The Company
has not held or issued derivative financial instruments in 2000 or 1999.

The Company's  invested  assets are liquid in order to meet  commitments  to our
Policyholders.  At June 30, 2000, the Company's  investment portfolio consisting
of cash,  marketable  short-term  investments,  investment  grade bonds,  common
stock, and preferred stock, totaled $799 million or 80.7% of total assets. These
resources  provide the  liquidity  the Company  requires to meet the  unforeseen
demands on its funds.

At June 30, 2000, the amortized  cost of the Company's five largest  investments
in corporate debt securities  totaled $33.4 million,  none of which individually
exceeded $8.0 million. These investments had a market value of $33.0 million.

The Company's investments are subject to  certain risks, including interest rate
and price risk. The Company monitors  exposure  to interest  rate  risk  through
periodic  reviews  of  asset  and  liability positions.  Estimates of cash flows


                                       13
<PAGE>


ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS (Continued)


and the  impact  of  interest  rate  fluctuations  relating  to  the  investment
portfolio  are  monitored  regularly.  Price  risk is defined as  the  potential
loss in   estimated  fair  value  resulting  from an adverse  change in  prices.
The Company's objective is  to  earn  competitive  relative returns by investing
in   a   diverse   portfolio  of  high-quality,  liquid   securities.  Portfolio
characteristics  are  analyzed  regularly  and market risk is  actively  managed
through a variety of  techniques.  Portfolio  holdings  are  diversified  across
industries  and  concentrations  in any one company or  industry  are limited by
parameters established by management and the Company's Board of Directors.

LIQUIDITY AND CAPITAL RESOURCES

Liquidity is a measure of the  Company's  ability to secure  enough cash to meet
its contractual obligations and operating needs.  Generally,  insurance premiums
are  collected  prior to claims and  benefit  disbursements  and these funds are
invested to provide  necessary cash flows in future years.  The Company's  major
sources of cash from  operations  are life  insurance  premiums  and  investment
income.  The net positive cash flow is used to fund Company  commitments  and to
build the investment  portfolio,  thereby increasing future investment  returns.
Net cash provided by operating activities for the six months ended June 30, 2000
was  $7,809,253  compared to $2,578,431  for the six months ended June 30, 1999.
The Company's  liquidity position remains strong as invested assets increased by
almost $51 million during the first six months of 2000 to $868 million.

Annuity  and  universal  life  deposits,  which do not  appear as revenue on the
financial  statements,  are a source of funds.  These  deposits do not involve a
mortality or morbidity  risk and are accounted  for using methods  applicable to
comparable   "interest-bearing   obligations"   of  other  types  of   financial
institutions.  This method of accounting  records deposits as a liability rather
than as a revenue.  Annuity and universal life deposits were  $15,512,708 in the
second quarter of 2000 and $19,825,121 in the second quarter of 1999.

The  Company's  current  commitments  for  expenditures  as of June 30, 2000 are
primarily for policy death benefits, policy surrenders and withdrawals,  general
operating expenses,  federal income taxes, and dividends to shareholders.  These
commitments  are met by cash flows from policy  revenue,  annuity and  universal
life  deposits and  investment  income.  Management  believes its cash flow from
operations  and its liquid  assets and  marketable  securities  will  enable the
Company to meet any foreseeable cash requirements.

As an added  measure of  liquidity,  the Company has  arranged for a $10 million
line of credit with a commercial  bank. At June 30, 2000 and 1999, there were no
borrowings on this line of credit.

The Company's 1999 year-end Risk Based Capital Analysis as reflected in its 1999
statutory  annual  statement shows total adjusted  capital of  $128,324,572  and
authorized  control level risk based capital of  $26,506,217.  These results are
indicative of the strong capital  position of the Company and are well in excess
of levels that would require regulatory action.


                          ********************



"Safe Harbor"  Statement Under the Private  Securities  Litigation Reform Act of
1995:  Certain  forward-looking  statements  contained  herein involve risks and
uncertainties. Many factors could cause future results to differ materially from
those discussed. Examples of such factors include but are not limited to: better
(or worse) mortality rates, changes in insurance regulations or legislation that
disadvantage the Company in the marketplace and recession,  economic  conditions
or stock market changes  affecting  pricing or demand for insurance  products or
ability to generate  investment  income.  Growth and profitability have been and
will be potentially materially affected by these and other factors.


                                       14
<PAGE>


Item 6.  Exhibits and Reports on Form 8-K

Exhibit 27 - Financial Data Schedule

All  other  exhibits  for  which  provision is made in the applicable accounting
regulation  of the Securities and Exchange Commission are not required under the
related instructions or are inapplicable, and therefore, have been omitted.

The Company did not file any reports on Form 8-K during the  three-month  period
ended June 30, 2000.

                                SIGNATURES

Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.

                                              Erie Family Life Insurance Company
                                                         (Registrant)

Date:   August 11, 2000                           \s\   Stephen A. Milne
                                             (Stephen A. Milne, President & CEO)


                                                  \s\   Philip A. Garcia
                              (Philip A. Garcia, Executive Vice President & CFO)



                                       15