Segments of Operations

9 Months Ended

Sep. 30, 2023

Segment Reporting [Abstract]

Segments of Operations

Segments of Operations

AFG manages its business as two segments: Property and casualty insurance and Other, which includes holding company costs 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 and other specialty transportation niches, 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 a deferred gain on a retroactive reinsurance transaction related to the sale of a business. 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 September 30,				Nine months ended September 30,
	2023		2022		2023		2022
Revenues
Property and casualty insurance:
Premiums earned:
Specialty
Property and transportation	$	828	$	857	$	1,837	$	1,805
Specialty casualty	734		677		2,149		1,973
Specialty financial	232		171		623		505
Other specialty	61		62		190		179
Total premiums earned	1,855		1,767		4,799		4,462
Net investment income	170		145		568		524
Other income	5		2		13		12
Total property and casualty insurance	2,030		1,914		5,380		4,998
Other	157		105		435		256
Total revenues before realized gains (losses)	2,187		2,019		5,815		5,254
Realized gains (losses) on securities	(19)		(35)		(67)		(143)
Realized loss on subsidiary	(4)		—		(4)		—
Total revenues	$	2,164	$	1,984	$	5,744	$	5,111
Earnings Before Income Taxes
Property and casualty insurance:
Underwriting:
Specialty
Property and transportation	$	42	$	39	$	117	$	140
Specialty casualty	78		118		261		372
Specialty financial	29		15		65		81
Other specialty	(6)		(14)		(22)		(30)
Other lines	(1)		(3)		(1)		(5)
Total underwriting	142		155		420		558
Investment and other income, net	156		134		527		498
Total property and casualty insurance	298		289		947		1,056
Other (*)	(56)		(44)		(138)		(136)
Total earnings (loss) before realized gains (losses) and income taxes	242		245		809		920
Realized gains (losses) on securities	(19)		(35)		(67)		(143)
Realized loss on subsidiary	(4)		—		(4)		—
Total earnings before income taxes	$	219	$	210	$	738	$	777

(*)Includes holding company interest and expenses, which includes gains/(losses) on retirement of debt as follows: zero and $1 million in the third quarters of 2023 and 2022, respectively; $1 million and ($10) million in the first nine months of 2023 and 2022, respectively. Also includes a special charge of $15 million in the third quarter of 2023 to increase A&E reserves related to AFG’s former railroad and manufacturing operations.