Company: AFGC
Filing Date: 2025-05-08
Form Type: 10-Q
Source: 0001042046-25-000020
Chunk: 135

Company: AMERICAN FINANCIAL GROUP INC
Filing Date: 2025-05-08
Form: 10-Q
Item: Part I, Item 2
Chunk 135
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 36 (31 %)Other income2 4 (50 %)Total revenues32 47 (32 %)Costs and Expenses:Property and casualty insurance — loss adjustment and underwriting expenses9 22 (59 %)Other expense — expenses associated with P&C fees16 14 14 %Other expenses40 42 (5 %)Costs and expenses, excluding interest charges on borrowed money65 78 (17 %)Loss before income taxes, excluding realized gains and losses and interest charges on borrowed money(33)(31)6 %Interest charges on borrowed money19 19 — %Loss before income taxes, excluding realized gains and losses$(52)$(50)4 %

Holding Company and Other — Net Investment Income

AFG recorded net investment income on investments held outside of its property and casualty insurance segment of $5 million in the first three months of 2025 compared to $7 million in the first three months of 2024, a decrease of $2 million (29%), reflecting a decrease in average investments and a change in the investment mix.

Holding Company and Other — P&C Fees and Related Expenses

Summit, a workers’ compensation insurance subsidiary, collects fees from a small group of unaffiliated insurers for providing underwriting, policy administration and claims services. In addition, certain of AFG’s property and casualty insurance businesses collect fees from customers for ancillary services such as workplace safety programs and premium financing. In the first three months of 2025 and 2024, AFG collected $25 million in fees for these services. Management views this fee income, net of the $16 million in the first three months of 2025 and $14 million in the first three months of 2024 in expenses incurred to generate such fees, as a reduction in the cost of underwriting its property and casualty insurance policies. In addition, AFG’s property and casualty insurance businesses earned $11 million in fees during the first three months of 2024 as compensation for providing services related to the administration of crop insurance business generated by Crop Risk Services (“CRS”) for its former owner prior to AFG’s acquisition of CRS in July 2023. The 

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Table of ContentsAMERICAN FINANCIAL GROUP, INC. 10-QManagement’s Discussion and Analysis of Financial Condition and Results of Operations — Continued

expenses related to providing such services are embedded in property and casualty underwriting expenses. Cons