Company: AFGC
Filing Date: 2025-02-25
Form Type: 10-K
Source: 0001042046-25-000011
Chunk: 9

Company: AMERICAN FINANCIAL GROUP INC
Filing Date: 2025-02-25
Form: 10-K
Item: Item 9C
Chunk 9
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 of reserves was complex because it required the involvement of our actuarial specialists due to the highly judgmental nature of the assumptions used in the evaluation process. The significant judgment was primarily due to the sensitivity of management’s best estimate to the selection and weighting of actuarial methods, loss development factors, and expected loss ratios. These assumptions have a significant effect on the valuation of reserves.

How We Addressed the Matter in Our AuditWe obtained an understanding, evaluated the design and tested the operating effectiveness of controls over the process for estimating reserves. This included, among others, the review and approval processes that management has in place for the methods and assumptions used in estimating the reserves. With the assistance of actuarial specialists, our audit procedures included, among others, an evaluation of the Company’s selection and weighting of actuarial methods used, including consideration of methods used in prior periods and those used in the industry for the specific types of insurance. To evaluate the significant assumptions used by management, we compared the significant assumptions, including loss development factors, and expected loss ratios, to factors historically used and current industry benchmarks. We also performed a review of the development of prior years’ reserve estimates. With the assistance of actuarial specialists, we established an independent range of reasonable reserve estimates, which we compared to management’s best estimate./s/ Ernst & Young LLPWe have served as the Company’s auditor since 1961.Cincinnati, OhioFebruary 25, 2025

F-2

AMERICAN FINANCIAL GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEET

(Dollars in Millions)

December 31,20242023Assets:Cash and cash equivalents$1,406 $1,225 Investments:Fixed maturities, available for sale at fair value (amortized cost — $10,687 and $10,752; allowance for expected credit losses of $34 and $12)10,398 10,377 Fixed maturities, trading at fair value76 57 Equity securities, at fair value751 1,018 Investments accounted for using the equity method2,277 1,814 Mortgage loans791 643 Real estate and other investments153 129 Total cash and investments15,852 15,263 Recoverables from reinsurers5,176 4,477 Prepaid reinsurance premiums1,013 961 Agents’ balances and premiums receivable1,532 1