Company: AFGC
Filing Date: 2025-05-08
Form Type: 10-Q
Source: 0001042046-25-000020
Chunk: 122

Company: AMERICAN FINANCIAL GROUP INC
Filing Date: 2025-05-08
Form: 10-Q
Item: Part I, Item 2
Chunk 122
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39 — 39 Total revenues1,753 92 47 1,892 14 1,906 Costs and Expenses:Losses and loss adjustment expenses907 — 5 912 — 912 Commissions and other underwriting expenses486 — 17 503 — 503 Interest charges on borrowed money— — 19 19 — 19 Expenses of MIEs— 92 — 92 — 92 Other expenses20 — 56 76 — 76 Total costs and expenses1,413 92 97 1,602 — 1,602 Earnings before income taxes340 — (50)290 14 304 Provision for income taxes70 — (11)59 3 62 Core Net Operating Earnings270 — (39)231 Non-core earnings (loss) (*):Realized gains on securities, net of tax— — 11 11 (11)— Net Earnings$270 $— $(28)$242 $— $242 

(*)See the reconciliation of core earnings to GAAP net earnings under “Results of Operations — General” for details on the tax impacts of these reconciling items.

Property and Casualty Insurance Segment — Results of Operations

Performance measures such as underwriting profit or loss and related combined ratios are often used by property and casualty insurers to help users of their financial statements better understand the company’s performance. Underwriting profitability is measured by the combined ratio, which is a sum of the ratios of losses and loss adjustment expenses, and commissions and other underwriting expenses to premiums. A combined ratio under 100% indicates an underwriting profit. The combined ratio does not reflect net investment income, other income, other expenses or federal income taxes.

AFG’s property and casualty insurance operations contributed $246 million in pretax earnings in the first three months of 2025 compared to $340 million in the first three months of 2024, a decrease of $94 million (28%). The decrease in pretax earnings reflects lower underwriting profit and lower investment income from AFG’s alternative investment portfolio (partnerships and similar investments and AFG-managed CLOs), partially offset by higher investment income outside of alternative investments in the first three months of 2025 compared to the first three months of