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                                                                    EXHIBIT 4.16

                              DECLARATION OF TRUST


         DECLARATION OF TRUST, dated as of June 20, 2003, among American
Financial Group, Inc., an Ohio corporation, as Sponsor, The Bank of New York
(Delaware), a Delaware banking corporation, as Delaware Trustee, The Bank of New
York, a New York banking corporation, as Property Trustee, and James C. Kennedy
and Thomas E. Mischell as Regular Trustees (collectively with the Delaware
Trustee and the Property Trustee, the "Trustees"). The Sponsor and the Trustees
hereby agree as follows:

         1. The trust created hereby (the "Trust") shall be known as "American
Financial Capital Trust IV", in which name the Trustees, or the Sponsor to the
extent provided herein, may conduct the business of the Trust, make and execute
contracts, and sue and be sued.

         2. The Sponsor hereby assigns, transfers, conveys and sets over to the
Trustees the sum of Ten Dollars ($10.00). The Trustees hereby acknowledge
receipt of such amount in trust from the Sponsor, which amount shall constitute
the initial trust estate. The Trustees hereby declare that they will hold the
trust estate in trust for the Sponsor. It is the intention of the parties hereto
that the Trust created hereby constitute a statutory trust under Chapter 38 of
Title 12 of the Delaware Code, 12 Del. C. ss. 3801 et seq. (the "Statutory Trust
Act"), and that this document constitute the governing instrument of the Trust.
The Trustees are hereby authorized and directed to execute and file a
certificate of trust with the Delaware Secretary of State in the form attached
hereto.

         3. The Sponsor and the Trustees will enter into an amended and restated
Declaration of Trust, satisfactory to each such party and substantially in the
form to be included as an Exhibit to the Registration Statement referred to
below, to provide for the contemplated operation of the Trust created hereby and
the issuance of the Preferred Securities and Common Securities referred to
therein. Prior to the execution and delivery of such amended and restated
Declaration of Trust, the Trustees shall not have any duty or obligation
hereunder or with respect to the trust estate, except as otherwise required by
applicable law or as may be necessary to obtain prior to such execution and
delivery and licenses, consents or approvals required by applicable law or
otherwise.

         4. The Sponsor and the Regular Trustees hereby authorize and direct the
Sponsor, in each case on behalf of the Trust as the sponsor of the Trust, (i) to
execute and file with the Securities and Exchange Commission (the "Commission")
(a) a Registration Statement on Form S-3 (the "Registration Statement") and any
pre-effective or post-effective amendments to such Registration Statement,
relating to the registration under the Securities Act of 1933, as amended, of
the Preferred Securities of the Trust, and (b) a Registration Statement on Form
8-A (the "1934 Act Registration Statement") (including all pre-effective and
post-effective amendments thereto) relating to the registration of the Preferred
Securities of the Trust under Section 12(b) of the

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Securities Exchange Act of 1934, as amended; (ii) to execute and file with the
New York Stock Exchange, the American Stock Exchange or such other national
securities exchange or the Nasdaq National Market System as the Sponsor shall
determine, a listing or other similar application and all other applications,
statements, certificates, agreements and other instruments as shall be necessary
or desirable to cause the Preferred Securities to be listed or approved for
quotation on the New York Stock Exchange, the American Stock Exchange or such
other national securities exchange or the Nasdaq National Market System; (iii)
to execute and file such applications, reports, surety bonds, irrevocable
consents, appointments of attorneys for service of process and other papers and
documents as shall be necessary or desirable to register the Preferred
Securities under the securities or "Blue Sky" laws of such jurisdictions as the
Sponsor, on behalf of the Trust, may deem necessary or desirable; and (iv) to
negotiate and execute an underwriting agreement among the Trust, the Sponsor, an
investment banking firm or firms of national reputation and the other parties
thereto relating to the offer and sale of the Preferred Securities. It is hereby
acknowledged and agreed that in connection with any execution, filing or
document referred to in clauses (i)-(iii) above, (A) any Regular Trustee (or his
attorneys-in-fact and agents or the Sponsor as permitted herein) is authorized
on behalf of the Trust to file and execute such document on behalf of the Trust,
provided that the Registration Statement shall be signed by all of the Regular
Trustees, and (B) the Property Trustee and the Delaware Trustee shall not be
required to join in any such filing or execute on behalf of the Trust any such
document unless required by the rules and regulations of the Commission, the New
York Stock Exchange (or such other national securities exchange or the Nasdaq
National Market System) or state securities or "Blue Sky" laws, and in such case
only to the extent so required. In connection with all of the foregoing, each
Regular Trustee, solely in its capacity as Trustee of the Trust, hereby
constitutes and appoints Karl J. Grafe and Fred J. Runk, or either of them, as
his true and lawful attorney-in-fact and agent, with full power of substitution
and resubstitution, for such Regular Trustee or in the Regular Trustee's name,
place and stead, in any and all capacities, to sign the Registration Statement,
the 1934 Act Registration Statement and any and all amendments (including
post-effective amendments) thereto, and to file the same, with all exhibits
thereto, and other documents in connection therewith, with the Commission,
granting unto said attorney-in-fact and agent full power and authority to do and
perform each and every act and thing requisite and necessary to be done in
connection therewith, as fully to all intents and purposes as such Regular
Trustee might or could do in person, hereby ratifying and confirming all that
said attorney-in-fact and agent, or his substitute or substitutes, shall do or
cause to be done by virtue hereof.

         5. This Declaration of Trust may be executed in one or more
counterparts.

         6. The number of Trustees initially shall be four (4) and thereafter
the number of Trustees shall be such number as shall be fixed from time to time
by a written instrument signed by the Sponsor which may increase or decrease the
number of Trustees; provided that, to the extent required by the Statutory Trust
Act, one Trustee shall be an entity that has its principal place of business in
the State of Delaware. Subject to the foregoing, the Sponsor is entitled to
appoint or remove without cause any Trustee at any time. The Trustees may resign
upon thirty days prior notice to the

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Sponsor.

         IN WITNESS WHEREOF, the parties hereto have caused this Declaration of
Trust to be duly executed as of the day and year first above written.

                                      AMERICAN FINANCIAL GROUP, INC.,
                                      as Sponsor



                                      By:      /s/ James C. Kennedy
                                           -----------------------------------
                                      Name: James C. Kennedy
                                      Title: Vice President


                                      THE BANK OF NEW YORK (Delaware),
                                      as Delaware Trustee



                                      By:      /s/ William T. Lewis
                                           -----------------------------------
                                      Name:     William T. Lewis
                                      Title:   Sr. Vice President


                                      THE BANK OF NEW YORK,
                                      as Property Trustee



                                      By:      /s/ Paul Schmalzel
                                           -----------------------------------
                                      Name: Paul Schmalzel
                                      Title: Vice President


                                           /s/ James C. Kennedy
                                      ----------------------------------------
                                      James C. Kennedy, as Trustee


                                           /s/ Thomas E. Mischell
                                      ----------------------------------------
                                      Thomas E. Mischell, as Trustee