Company: AFGC
Filing Date: 2025-02-25
Form Type: 10-K
Source: 0001042046-25-000011
Chunk: 156

Company: AMERICAN FINANCIAL GROUP INC
Filing Date: 2025-02-25
Form: 10-K
Item: Item 7
Chunk 156
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,746 $(339)94 %Non-investment grade fixed maturities with losses for:Less than one year (39 securities)$46 $(3)94 %One year or longer (129 securities)142 (11)93 %$188 $(14)93 %

To evaluate fixed maturities for expected credit losses (impairment), management considers the following:

(a)whether the unrealized loss is credit-driven or a result of changes in market interest rates,

(b)the extent to which fair value is less than cost basis,

(c)cash flow projections received from independent sources,

(d)historical operating, balance sheet and cash flow data contained in issuer SEC filings and news releases,

(e)near-term prospects for improvement in the issuer and/or its industry,

(f)third-party research and communications with industry specialists,

(g)financial models and forecasts,

(h)the continuity of interest payments, maintenance of investment grade ratings and hybrid nature of certain investments,

(i)discussions with issuer management, and

(j)ability and intent to hold the investment for a period of time sufficient to allow for anticipated recovery in fair value.

Based on its analysis of the factors listed above, management believes AFG will recover its cost basis (net of any allowance) in the fixed maturity securities with unrealized losses and that AFG has the ability to hold the securities until they recover in value and had no intent to sell them at December 31, 2024. Although AFG has the ability to continue holding its fixed maturity investments with unrealized losses, its intent to hold them may change due to deterioration in the issuers’ creditworthiness, decisions to lessen exposure to a particular issuer or industry, asset/liability management decisions, market movements, changes in views about appropriate asset allocation or the desire to offset taxable realized gains. Should AFG’s ability or intent change regarding a particular security, a charge for impairment would likely be required. While it is not possible to accurately predict if or when a specific security will become impaired, increases in the allowance for credit losses could be material to results of operations in future periods. Significant declines in the fair value of AFG’s investment portfolio could have a significant adverse effect on AFG’s liquidity. For information on AFG’s realized gains (losses) on securities, see “Results of Operations — Realized Gains (Losses) on Securities.”

37

Uncertainties

As more fully explained in the following paragraphs, management believes that the areas posing the greatest risk