Quarterly Operating Results (Unaudited)

12 Months Ended

Dec. 31, 2014

Quarterly Financial Information Disclosure [Abstract]

Quarterly Operating Results (Unaudited)

Quarterly Operating Results (Unaudited)

The operations of certain AFG business segments are seasonal in nature. While insurance premiums are recognized on a relatively level basis, claim losses related to adverse weather (snow, hail, hurricanes, severe storms, tornadoes, etc.) may be seasonal. The profitability of AFG’s crop insurance business is primarily recognized during the second half of the year as crop prices and yields are determined. Quarterly results necessarily rely heavily on estimates. These estimates and certain other factors, such as the discretionary sales of assets, cause the quarterly results not to be necessarily indicative of results for longer periods of time.

The following are quarterly results of consolidated operations for the two years ended December 31, 2014 (in millions, except per share amounts). Quarterly earnings per share do not add to year-to-date amounts due to changes in shares outstanding.

	1st Quarter		2nd Quarter		3rd Quarter		4th Quarter		Total Year
2014
Revenues	$	1,211	$	1,392	$	1,581	$	1,529	$	5,713
Net earnings, including noncontrolling interests	107		83		91		125		406
Net earnings attributable to shareholders	103		106		116		127		452
Earnings attributable to shareholders per Common Share:
Basic	$	1.15	$	1.18	$	1.30	$	1.44	$	5.07
Diluted	1.13		1.15		1.28		1.41		4.97
Average number of Common Shares:
Basic	89.6		89.6		89.0		87.9		89.0
Diluted	91.6		91.6		90.9		89.8		91.0
2013
Revenues	$	1,148	$	1,139	$	1,443	$	1,362	$	5,092
Net earnings, including noncontrolling interests	113		77		98		165		453
Net earnings attributable to shareholders	120		110		83		158		471
Earnings attributable to shareholders per Common Share:
Basic	$	1.34	$	1.23	$	0.94	$	1.77	$	5.27
Diluted	1.32		1.20		0.92		1.73		5.16
Average number of Common Shares:
Basic	89.4		89.6		89.1		89.4		89.3
Diluted	91.0		91.5		91.0		91.4		91.2

Pretax realized gains on subsidiaries and securities (including other-than-temporary impairments) and favorable (adverse) prior year development of AFG’s liability for losses and loss adjustment expenses (“LAE”) were as follows (in millions):

	1st Quarter		2nd Quarter			3rd Quarter			4th Quarter			Total Year
Realized Gains
2014	$	19	$	12		$	13		$	8		$	52
2013	57		41			56			63			217
Prior Year Development Favorable (Adverse)
2014	$	31	$	(14	)	$	(13	)	$	(10	)	$	(6	)
2013	28		22			(40		)	5			15

Adverse prior year development for the second quarter of 2014 includes $22 million of adverse reserve development in the property and transportation sub-segment, which resulted from an increase in claim severity in the commercial auto liability business, partially offset by lower than expected claim severity in the agricultural and property and inland marine businesses. Adverse prior year development for the third quarter of 2014 includes pretax special charges of $24 million to strengthen property and casualty insurance A&E reserves. Adverse prior year development in the fourth quarter of 2014 was due primarily to adverse reserve development at Marketform and higher than expected claim severity in contractor claims and in a run-off book of casualty business.

Adverse prior year development for the third quarter of 2013 includes pretax special charges of $54 million to strengthen property and casualty insurance A&E reserves.

Results for the third quarter of 2014 and 2013 include pretax special charges of $6 million and $22 million, respectively, to strengthen reserves for A&E exposures related to AFG’s former railroad and manufacturing operations.