Company: AFGC
Filing Date: 2025-02-25
Form Type: 10-K
Source: 0001042046-25-000011
Chunk: 80

Company: AMERICAN FINANCIAL GROUP INC
Filing Date: 2025-02-25
Form: 10-K
Item: Item 1
Chunk 80
---
 group, like many others in the industry, has A&E claims arising in most cases from general liability policies written more than thirty-five years ago. The establishment of reserves for such A&E claims presents unique and difficult challenges and is subject to uncertainties significantly greater than those presented by other types of claims. For a discussion of these uncertainties, see Item 7 — Management’s Discussion and Analysis of Financial Condition and Results of Operations — “Uncertainties — Asbestos and Environmental-related (“A&E”) Insurance Reserves” and Note M — “Contingencies” to the financial statements.

The following table (in millions) is a progression of the property and casualty group’s A&E reserves.

202420232022Reserves at beginning of year, net of reinsurance recoverable$370 $385 $408 Incurred losses and LAE— — — Paid losses and LAE(11)(15)(23)Reserves at end of year, net of reinsurance recoverable359 370 385 Reinsurance recoverable, net of allowance135 128 140 Gross reserves at end of year$494 $498 $525 

AFG annually conducts a comprehensive review of its asbestos and environmental reserves. In connection with these reviews, AFG engages with outside counsel and, as appropriate, engineering and consulting firms and specialty actuarial firms.

An in-depth internal review of AFG’s A&E reserves was completed in the third quarter of 2024 by AFG’s internal A&E claims specialists in consultation with specialty outside counsel. The 2024 internal review identified no new trends and recent claims activity was generally consistent with AFG’s expectations resulting from AFG’s in-depth internal reviews in 

12

2023 and 2022 and most recent external study in 2020. As a result, the 2024 review resulted in no net change to AFG’s property and casualty insurance segment’s asbestos and environmental reserves.

Marketing

The property and casualty insurance group directs its sales efforts primarily through independent insurance agents and brokers, although small portions are written through employee agents. Independent agents and brokers generally receive a commission on the sale of each policy. Some agents and brokers are eligible for a bonus commission based on the overall profitability of policies or volume of business placed with AFG by the broker or agent in a particular year. The property and casualty insurance group writes insurance through several thousand agents and brokers.

Competition

AFG’s property and casualty insurance businesses compete with other individual insurers, state