Company: AFGC
Filing Date: 2025-02-25
Form Type: 10-K
Source: 0001042046-25-000011
Chunk: 144

Company: AMERICAN FINANCIAL GROUP INC
Filing Date: 2025-02-25
Form: 10-K
Item: Item 7
Chunk 144
---
 fourth quarter of 2023 and lower underwriting profit.

Full year 2024 net earnings were $887 million ($10.57 per share, diluted) compared to $852 million ($10.05 per share, diluted) in 2023. The year-over-year increase was due primarily to the impact on net investment income of higher yields on fixed maturity investments coupled with the impact of net realized losses on securities in 2023. These items were partially offset by lower net investment income from AFG’s alternative investment portfolio and lower underwriting profit.

Outlook

Management expects continued premium growth and strong underwriting results in the ongoing generally favorable property and casualty insurance market. In addition, management anticipates the deployment of cash during the elevated 

30

Table of Contents

interest rate environment (since early 2022) will continue to have a positive impact on investment income on fixed maturity investments in 2025.

AFG’s financial condition, results of operations and cash flows are impacted by the economic, legal and regulatory environment. Economic inflation, social inflation and other economic conditions may impact premium levels, loss cost trends and investment returns. For a more comprehensive list of risks, see “Item 1A — Risk Factors.”

Management believes that AFG’s strong financial position and current liquidity and capital at its subsidiaries will give AFG the flexibility to continue to effectively address and respond to anticipated and unanticipated challenges. AFG’s insurance subsidiaries continue to have capital at or in excess of the levels required by ratings agencies in order to maintain their current ratings, and the parent company does not have any near-term debt maturities.

CRITICAL ACCOUNTING POLICIES

Significant accounting policies are summarized in Note A — “Accounting Policies” to the financial statements. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that can have a significant effect on amounts reported in the financial statements. As more information becomes known, these estimates and assumptions change and, thus, impact amounts reported in the future. The areas where management believes the degree of judgment required to determine amounts recorded in the financial statements is most significant are as follows:

•the valuation of investments, including the determination of impairment allowances,

•the establishment of insurance reserves, especially asbestos and environmental-related reserves,

•the recoverability of reinsurance, and

•the establishment of asbestos and environmental liabilities of former railroad and manufacturing operations.

See “Liquidity and Capital Resources — Uncertainties” for a discussion of insurance reserves, recoverables from reinsurers and