8-K

                                 UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549


                                    FORM 8-K


                                 CURRENT REPORT
                     PURSUANT TO SECTION 13 OR 15(d) OF THE
                        SECURITIES EXCHANGE ACT OF 1934


         Date of report (Date of earliest event reported): May 27, 2003


                         AMERICAN FINANCIAL GROUP, INC.
             (Exact name of registrant as specified in its charter)


                                    DELAWARE
                 (State or other jurisdiction of incorporation)


       1-13653                                             31-1544320
(Commission File Number)                       (IRS Employer Identification No.)


                             ONE EAST FOURTH STREET
                             CINCINNATI, OHIO 45202
          (Address of principal executive offices including Zip Code)

       Registrant's telephone number, including area code: (513) 579-2121




ITEM 5. OTHER EVENTS.

     Please see the press release attached hereto as Exhibit 99.1. In the
release, the Company presented a revised "core earnings" expectation. The core
earnings concept is used to assist investors in analyzing the trend of operating
results. The Company's core earnings may differ from GAAP net earnings, as has
been the case in recent periods, in that its core earnings exclude realized
investment gains and losses, certain special tax benefits, results of operations
of non-insurance investee companies, the cumulative effect of accounting changes
and certain other unusual items (such as litigation settlements) because they
are unpredictable and not necessarily indicative of current operating
fundamentals. The core earnings projection is not accompanied in the release by
"comparable" GAAP net earnings because the items needed to reconcile from core
earnings to GAAP net earnings are not reasonably estimable.


ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.

     (a) Financial statements of business acquired. Not applicable.

     (b) Pro forma financial information. Not applicable.

     (c) Exhibits.

Exhibit No.      Description
- -----------      ----------------------------------------------------

99.1             Press release, dated as of May 27, 2003, relating to American
                 Financial Group, Inc.'s announcement of the effect of a recent
                 arbitration decision.




                                   SIGNATURE

     Pursuant to the requirements of the Securities Exchange Act of 1934, the
registration has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.


                                        AMERICAN FINANCIAL GROUP, INC.


Dated: May 27, 2003                     By: /s/ James C. Kennedy
                                            ------------------------------------
                                            James C. Kennedy
                                            Vice President




                               INDEX TO EXHIBITS

99.1         Press release, dated as of May 27, 2003, relating to American
             Financial Group, Inc.'s announcement of the effect of a recent
             arbitration decision.

EX-99.1

                                                                    EXHIBIT 99.1


                  AMERICAN FINANCIAL GROUP, INC. NEWS RELEASE
- --------------------------------------------------------------------------------

Date:        May 27, 2003           Contact:   Anne N. Watson
                                               Vice President-Investor Relations
For Release: Immediate              Phone:     (513) 579-6652
                                    Web Sites: www.amfnl.com
                                               www.GreatAmericanInsurance.com


                         AMERICAN FINANCIAL GROUP, INC.
                 ANNOUNCES EFFECT OF RECENT ARBITRATION DECISION

Cincinnati, Ohio - May 27, 2003 - American Financial Group, Inc. (NYSE: AFG)
announced last week that its principal property and casualty insurance
subsidiary, Great American Insurance Company, had been notified of an
arbitration decision resulting from its share of a 1995 property fire and
business interruption claim. Unless challenged by one of the other parties, it
is anticipated that the decision of the panel will be submitted for entry of
judgment to the Federal District Court and become final shortly. Based on these
developments, AFG today announced that its second quarter earnings will include
an after tax charge of approximately $29 million, or $.41 per share, for the
claim.

The charge represents Great American's share of the claim, net of previously
recorded reserves and payments. The Company was a 9.5% participant with a number
of other companies in the insurance pool that insured the loss during the 1995
coverage year. Great American reduced its participation to 0.2 percent in the
following year and no longer participates in the pool.

Based on appraisals, legal advice and relevant policy provisions, Great American
made substantial payments to the insured subsequent to the loss. In addition,
Great American had established reserves in excess of payments previously made
with respect to disputed portions of the loss. Carl H. Lindner III, co-president
and head of AFG's property and casualty operations, stated, "We were surprised
and disappointed with the outcome of this arbitration. We believe that the
result reached beyond reasonable interpretation of the underlying facts and the
policies written. Nevertheless, we look forward to closing this disputed
matter."

As a result of this matter, and after review of the Company's earnings to date,
Mr. Lindner added, "We are revising our 2003 core earnings expectation to $2.10
to $2.30 per share, including the arbitration charge."

American Financial Group, Inc. is engaged primarily in property and casualty
insurance, focusing on specialized commercial products for businesses, and in
the sale of annuities, life and supplemental health insurance products.

This press release contains certain statements that may be deemed to be
"forward-looking statements" within the meaning of Section 27A of the Securities
Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All
statements in this press release not dealing with historical results are
forward-looking and are based on estimates, assumptions and projections.
Examples of such forward looking statements include statements relating to: the
Company's expectations concerning market and other conditions, future premiums,
revenues, earnings and investment activities; expected losses and the adequacy
of reserves for asbestos, environmental pollution and mass tort claims; rate
increases, improved loss experience and expected expense savings resulting from
other recent initiatives.




Actual results could differ materially from those expected by AFG depending on
certain factors including but not limited to: the unpredictability of possible
future litigation if certain settlements do not become effective, changes in
economic conditions including interest rates, performance of securities markets,
and the availability of capital, regulatory actions, changes in legal
environment, judicial decisions and rulings, tax law changes, levels of
catastrophes and other major losses, the actual amount of liabilities associated
with certain asbestos and environmental related insurance claims, adequacy of
loss reserves, availability of reinsurance and ability of reinsurers to pay
their obligations, competitive pressures, including the ability to obtain rate
increases, driving patterns and other changes in market conditions that could
affect AFG's insurance operations.


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