EXHIBIT 10.41 - COST SHARING AGREEMENT
                   FOR INFORMATION TECHNOLOGY DEVELOPMENT



This Cost Sharing  Agreement  ("Agreement") is made this 14th day of March, 2001
(the "Effective  Date") by and among Erie Insurance  Exchange by and through its
Attorney-in-Fact  Erie Indemnity Company,  Flagship City Insurance Company, Erie
Insurance Company, Erie Insurance Property & Casualty Insurance Company and Erie
Insurance  Company of New York,  which  entities  are the  property and casualty
insurers of the Erie Insurance Group.

WHEREAS,  these insurers have undertaken to review in  comprehensive  detail the
information technology  requirements projected over the next several years which
will be necessary to improve their respective business and customer  interaction
systems; and

WHEREAS, these insurers recognize that electronic commerce plays a critical role
in  remaining  competitive  in this  industry,  and it is  essential  that these
companies move to a technological  platform that is principally based on the use
of Internet technology to conduct electronic commerce; and

WHEREAS, it is critical and a commercial necessity for these insurers to develop
informational  technology  for the storage and access of essential  customer and
insurance  information on their respective  policyholders since such information
will be  vitally  important  for  the  ability  to  compete  effectively  in the
financial  services  marketplace of the future,  particularly  with the enhanced
levels of service required to meet customer expectations; and

WHEREAS, the fundamental technological infrastructure,  applications,  processes
and  methodologies  necessary to develop and support a wholesale  migration to a
new,  electronic  commerce  environment  will be required to sustain and enhance
services  and  products  delivered  to  subscribers  and  policyholders  of  the
insurers; and

WHEREAS,   the  necessary   information   technology  to  meet  these   customer
expectations envisions policyholders having the capability of Internet access to
their individual accounts and information; and

WHEREAS,  because  of their  inter-related  business  relationships,  it will be
necessary  for these  companies to develop and utilize these systems on a shared
basis; and

WHEREAS, it is the intent to distribute the costs of this necessary  information
technology among these companies on a fair and reasonable basis.

NOW,  THEREFORE,  intending to be legally bound, and for and in consideration of
the mutual promises and  consideration  contained  herein,  the parties agree as
follows:

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     1. Erie  Insurance  Exchange,  by and  through its  Attorney-in-Fact,  Erie
     Indemnity  Company,  will undertake to develop,  cause to be developed,  or
     purchase  software  programs of outside vendors ("Third Party Software") to
     be  deployed  and  integrated  into the  following  information  technology
     application systems and infrastructure  elements for the use and benefit of
     all of the members of the Erie Insurance Group:

         A. On-line Policy Processing System as  more fully described in Exhibit
            A which is attached hereto.

         B. Customer Relationship  Management System  as more fully described in
            Exhibit B which is attached hereto.

         C. Required   Information  Technology  Infrastructure   as  more  fully
            described in Exhibit C which is attached hereto.

(hereinafter collectively referred to as the "OLPP/CRM Systems")

     2. The parties hereto  recognize and acknowledge  that the ownership of the
     intellectual   property  comprising  these  OLPP/CRM  Systems  will  reside
     permanently with the Erie Insurance  Exchange.  All aspects of the OLPP/CRM
     Systems,   including   without   limitation,    programs   and   processing
     methodologies  shall  remain the sole and  exclusive  property  of the Erie
     Insurance Exchange and shall not be sold, revealed,  disclosed or otherwise
     communicated,  directly or indirectly, by any company or entity entitled to
     use such OLPP/CRM Systems.  It is expressly  understood that no title to or
     ownership  of  the  OLPP/CRM  Systems,  or  any  part  thereof,  is  hereby
     transferred  from the Exchange to any other  company of the Erie  Insurance
     Group.  Such property  rights as  delineated  herein do not extend to Third
     Party  Software  that may be  integrated  into the  OLPP/CRM  Systems,  but
     appropriate  licensing  agreements will be obtained to include usage by all
     parties hereto.

     3. The Erie Insurance  Exchange will undertake to assure that all companies
     that are parties to this  Agreement  will have equal access to the OLPP/CRM
     Systems for the  benefit of their  respective  policyholders,  and the Erie
     Insurance Exchange,  subject to the terms and conditions of this Agreement,
     specifically  grants to Flagship City  Insurance  Company,  Erie  Insurance
     Company,  Erie  Insurance  Property & Casualty  Company and Erie  Insurance
     Company  of New  York  a  non-transferable  perpetual  license  to use  the
     OLPP/CRM Systems.

     4. All  costs to  develop,  purchase,  deploy,  implement,  integrate,  and
     maintain the OLPP/CRM Systems (the "Costs of the OLPP/CRM Systems") will be
     incurred  by and  accrue to the Erie  Insurance  Exchange  on and after the
     Effective  Date  hereof and no such costs have been  incurred  prior to the
     Effective Date hereto.  The Costs of the OLPP/CRM  Systems will be incurred
     as underwriting  expenses  established on the books and records of the Erie
     Insurance  Exchange in accordance with statutory  accounting  practices and
     procedures.  The  Costs  of the  OLPP/CRM  Systems  will  be  ceded  to the
     inter-company  Reinsurance  Pooling  Agreement  effective  January  1, 1995
     ("Reinsurance  Pooling  Agreement") among the parties hereto. In accordance
     with the  terms of the  Reinsurance  Pooling  Agreement,  the  Costs of the
     OLPP/CRM  Systems will be borne by the parties  hereto in  accordance  with

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     their  "Respective  Percentage  Share" as  established  in the  Reinsurance
     Pooling Agreement as follows:

                  Erie Insurance Exchange                     - 94.5%
                  Erie Insurance Company                      -  5.0%
                  Erie Insurance Company of New York          -  0.5%
                  Flagship City Insurance Company             -    0%
                  Erie Insurance Property & Casualty Co.      -    0%

     5. Erie  Insurance  Exchange will keep accurate and current  records on the
     Costs of the OLPP/CRM Systems,  including the cost of Third Party Software,
     as it is the intent of this  Agreement  to share such Costs of the OLPP/CRM
     Systems on a fair and reasonable basis among the user companies.

     6. This Section 6 of the  Agreement is intended to establish  the procedure
     for adjusting the sharing of the Costs of the OLPP/CRM Systems in the event
     that any of the Respective  Percentage  Shares as described in Section 4 of
     this Agreement are changed after the date of this Agreement.

Solely for purposes of this section,  the following  terms have the meanings set
out below:

"Inception to Date  Investment in OLPP/CRM  Systems" shall mean the Costs of the
OLPP/CRM  Systems  incurred  from  inception  to the date of any  change  in the
Respective Percentage Shares.

"Economic  Life  End  Date"  shall  mean a date  exactly  seven  years  from the
occurrence of the first of the following:  (i) the date the OLPP/CRM Systems are
ready  to be  "placed  in  service"  as that  term is  generally  understood  in
Generally Accepted Accounting Principles, or (ii) the date either one or both of
the OLPP/CRM Systems are considered abandoned.

"Remaining  Economic  Life" shall mean the period of time,  expressed in nearest
whole months,  between the date of any change in the Respective Percentage Share
in the Reinsurance Pooling Agreement to the Economic Life End Date.

"Recapture  Percentage"  shall mean,  for each  entity  which is a party to this
Agreement,  the change (positive or negative) derived by subtracting the revised
Respective  Percentage  Share  under  any  new or  amended  Reinsurance  Pooling
Agreement  from the  current  Respective  Percentage  Share  in the  Reinsurance
Pooling Agreement under the terms in existence as of the date of this Agreement.

"Remaining  Economic  Value"  shall mean an amount  computed by (i) dividing the
Inception  to Date  investment  in  OLPP/CRM  Systems by 84  (months),  and (ii)
multiplying that result by the Remaining Economic Life in months.

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In the event the Reinsurance Pooling Agreement Respective  Percentage Shares are
modified at any time prior to the  Economic  Life End Date,  it is the intent of
the parties  that the cost sharing  terms as provided  for under this  Agreement
will be adjusted  equitably,  to share the costs considering the economic impact
of any revised  Respective  Percentage Shares. The amount of the adjustment with
respect  to and  among  the  parties  to this  Agreement  shall be  computed  by
multiplying  the Recapture  Percentage  for the respect  entity by the Remaining
Economic  Value.   The  parties  hereby  agree  to  settle  such  obligation  in
immediately  available funds not more than 30 days from the date the Reinsurance
Pooling Agreement  Respective  Percentage  Shares are changed,  positive amounts
representing amounts due the party,  negative amounts reflecting amounts owed by
the party.

     7. This Agreement shall be submitted in a timely and appropriate  manner to
     the Pennsylvania  Insurance  Department in accordance with the Pennsylvania
     Insurance Holding Companies Act (40 P.S.ss.991.1405).

     8. It is the express intent of the parties to this Agreement to establish a
     fair and  reasonable  basis for the  sharing  of the Costs of the  OLPP/CRM
     Systems.  It is understood  among the parties that this undertaking for the
     development  of the  OLPP/CRM  Systems will proceed over a duration of more
     than one year and that  unforeseen  contingencies  could  occur  that could
     disrupt  the  development  process.  Nevertheless,  it is the intent of the
     parties to have equal  access to the  OLPP/CRM  Systems and share fairly in
     the Costs of the  OLPP/CRM  Systems,  and should  circumstances  arise that
     would  require  adjustments  among the parties in the  allocation of costs,
     then the parties  will  proceed to  equitably  adjust the costs in a manner
     that would be fair and  reasonable  taking  into  consideration  all of the
     facts and circumstances and the interrelated business  relationships of the
     parties.

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                            ERIE INSURANCE EXCHANGE
                            BY AND THROUGH ITS ATTORNEY-IN-
                            FACT ERIE INDEMNITY COMPANY


                   By:           /s/ Stephen A. Milne
                                     Stephen A. Milne
                                     President & CEO



                            FLAGSHIP CITY INSURANCE COMPANY


                   By:           /s/ Jeffrey A. Ludrof
                                     Jeffrey A. Ludrof
                                     Executive Vice President



                            ERIE INSURANCE COMPANY


                   By:           /s/ Jan R. Van Gorder
                                     Jan R. Van Gorder
                                     Sr. Executive Vice President



                            ERIE INSURANCE PROPERTY &
                            CASUALTY COMPANY


                   By:           /s/ Philip A. Garcia
                                     Philip A. Garcia
                                     Executive Vice President & CFO



                            ERIE INSURANCE COMPANY OF NEW YORK


                   By:           /s/ Timothy G. NeCastro
                                     Timothy G. NeCastro
                                     Senior Vice President & Controller

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                                     EHHIBIT A

                        ONLINE POLICY PROCESSING SYSTEM ("OLPP")


OLPP System is an integrated  system of function,  capabilities and features for
electronic  data entry  automated  underwriting  rating,  and  automated  policy
processing built around a central customer file that enables servicing of all of
the customer's policies. This integrated system captures detailed information on
a customer and  underwrites the policy as accurately and efficiently as possible
for both  commercial and personal  lines.  This digital  system would  eliminate
paper as much as possible,  creating a single,  digital file for each policy and
customer.

In  addition  to  automated  underwriting,  features  of OLPP  include:  on-line
intelligence for agents to guide them through submissions,  storage of quotes in
client file  organization,  on-line viewing of stored quotes,  automated  policy
issuance and document  management,  historical  archiving of policy information,
on-line  change  processing and  management,  automated  renewal  processing and
workflow  automated the initiation and processing of premium audits,  management
of certificates of insurance and proof of insurance and support  reinsurance for
commercial lines.

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                                     EXHIBIT B

                  CUSTOMER RELATIONSHIP MANAGEMENT SYSTEM ("CRM")


CRM is an  information  platform  that  provides a single  view of the  customer
across the enterprise in support of all customer processes and touchpoints.  CRM
usually includes tools that enable sales force automation,  customer interaction
management and marketing automation tools.

Sales  force  automation   capabilities  aid  the  agents  with  lead  tracking,
appointment tracking,  marketing materials shipping, and marketing effectiveness
tracking. Its focus is on converting leads into sales.

Customer  interaction  management tracks all  customer-enterprise  communication
across all communication channels - including call centers,  agents, e-mail, and
websites.

Marketing  automation  tools help the  enterprise  to manage its  campaigns  and
promotions  and to cross sell and up sell its products and  services.  Marketing
assistance may occur in two ways:  system  initiated and user initiated.  System
initiated  assistance  is done  using rule based  alerts  that  prompt the sales
person with potential cross selling and up selling opportunities. User initiated
assistance  is triggered by sales  targets  identified  by querying the customer
database.

This initiative will deliver a customer relationship management system that will
enable a  policyholder-centric  focus at the agent and customer service level of
interaction.  This  system  will  allow  for the  tracing  of  customer  service
inquiries,  cross selling, up selling,  and it will increase the productivity of
the  home  office  customer  service  representatives,  agent  customer  service
representatives  and the  agent.  This  initiative  will  focus on the  customer
interaction  management and sales force automation portions of CRM. In addition,
this initiative will enable ERIE to analyze the customer data captured by CRM.

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                                     EXHIBIT C

                     REQUIRED INFORMATION TECHNOLOGY INFRASTRUCTURE


Design and Implement Web Infrastructure

The majority of new  applications  deployed at ERIE will utilize a browser based
user  interface.  Each of these  applications  should  be built on a common  web
infrastructure,  allowing new  application  deployment to be completed in a more
timely fashion,  minimizing custom development,  reducing subsequent  deployment
and maintenance  costs and providing the users of ERIE  applications with a more
homogeneous user experience.

The web infrastructure will centralize  functions such as web content management
and application and web server  monitoring and management.  The building of this
infrastructure  will primarily consist of choosing the appropriate  software and
hardware  platforms for these key components and then deploying and  integrating
them with the ERIE environment.

Deployment  of new ERIE  applications  will  require the  appropriate  degree of
integration  with  the web  infrastructure.  There  will  need to be one  common
registration  process,  a central  repository of user access  information  and a
single set of screens for user sign-on.  Each application  deployed must be able
to recognize  when a user has already signed onto ERIE and must be able to share
key  information  with the centralized  services such as  registration  data and
event logging.

Data Transformation Architecture & Tools

The focus of this  initiative is to purchase and integrate the tools required to
support  data  extraction,  cleansing  and  transformation  for the  creation of
operational  data stores and to support  operational and analytical  processing.
This  infrastructure  will be essential for  supporting a range of  initiatives,
including but not limited to:

o        Creation of databases to support new operational systems, such as a CRM
         or a web enabled front end

o        Creation  of  an environment where online  analytical processing can be
         used to derive a greater understanding of ERIE's customers

o        Creation of  a  data  mart  to  support agent performance reporting and
         analysis

o        Any holistic customer-oriented reporting

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                                   EXHIBIT C

                     REQUIRED INFORMATION TECHNOLOGY INFRASTRUCTURE(Continued)



Integration Architecture

Integration  architecture  will  be  developed  to  enable  a  unified  view  of
information  to multiple  back-end  systems.  This  unified  view is required to
provide a common web front-end to back-end systems. The integration architecture
is also required to ensure that multiple systems contain consistent information,
improving the accuracy of reporting.  Commitment to the architecture will ensure
that applications are integrated to maximize flexibility and minimize cost.

The  integration  architecture  will provide  technology  adapters,  application
adapters,   tools   for   building   custom   adapters,   metadata   repository,
transformation, content based routing, deployment tools, and management tools to
monitor  and  adjust  for  quality  and   performance.   The  building  of  this
infrastructure  will primarily consist of choosing the appropriate  software and
hardware  platforms for these key components and then deploying and  integrating
them with the ERIE environment.

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