Segments of Operations

6 Months Ended

Jun. 30, 2019

Segment Reporting [Abstract]

Segments of Operations

Segments of Operations

AFG manages its business as three segments: (i) Property and casualty insurance, (ii) Annuity and (iii) Other, which includes holding company costs, revenues and costs of AFG’s limited insurance operations outside of property and casualty insurance and annuities, and operations attributable to the noncontrolling interests of the managed investment entities.

AFG reports its property and casualty insurance business in the following Specialty sub-segments: (i) Property and transportation, which includes physical damage and liability coverage for buses and trucks, inland and ocean marine, agricultural-related products and other commercial property coverages, (ii) Specialty casualty, which includes primarily excess and surplus, executive and professional liability, general liability, umbrella and excess liability, specialty coverages in targeted markets, customized programs for small to mid-sized businesses and workers’ compensation insurance, and (iii) Specialty

financial, which includes risk management insurance programs for lending and leasing institutions (including equipment leasing and collateral and lender-placed mortgage property insurance), fidelity and surety products and trade credit insurance. Premiums and underwriting profit included under Other specialty represent business assumed by AFG’s internal reinsurance program from the operations that make up AFG’s other Specialty sub-segments and amortization of deferred gains on retroactive reinsurance transactions related to the sales of businesses in prior years. AFG’s annuity business sells traditional fixed, fixed-indexed and variable-indexed annuities in the retail, financial institutions, broker-dealer and registered investment advisor markets. AFG’s reportable segments and their components were determined based primarily upon similar economic characteristics, products and services.

The following tables (in millions) show AFG’s revenues and earnings before income taxes by segment and sub-segment.

	Three months ended June 30,				Six months ended June 30,
	2019		2018		2019		2018
Revenues
Property and casualty insurance:
Premiums earned:
Specialty
Property and transportation	$	379	$	374	$	740	$	724
Specialty casualty	634		595		1,263		1,174
Specialty financial	151		159		297		308
Other specialty	36		33		73		62
Total premiums earned	1,200		1,161		2,373		2,268
Net investment income	124		115		228		215
Other income	2		2		5		4
Total property and casualty insurance	1,326		1,278		2,606		2,487
Annuity:
Net investment income	451		412		886		806
Other income	27		27		54		53
Total annuity	478		439		940		859
Other	100		85		198		168
Total revenues before realized gains (losses)	1,904		1,802		3,744		3,514
Realized gains (losses) on securities	56		31		240		(62		)
Total revenues	$	1,960	$	1,833	$	3,984	$	3,452

Earnings Before Income Taxes
Property and casualty insurance:
Underwriting:
Specialty
Property and transportation	$	4		$	23		$	43		$	56
Specialty casualty	47			29			83			70
Specialty financial	21			22			34			37
Other specialty	(12		)	(1		)	(12		)	2
Other lines	(1		)	(1		)	(2		)	(2		)
Total underwriting	59			72			146			163
Investment and other income, net	115			106			210			199
Total property and casualty insurance	174			178			356			362
Annuity	71			99			161			224
Other (*)	(42		)	(48		)	(85		)	(90		)
Total earnings before realized gains (losses) and income taxes	203			229			432			496
Realized gains (losses) on securities	56			31			240			(62		)
Total earnings before income taxes	$	259		$	260		$	672		$	434

(*)

Includes holding company interest and expenses.