AMERICAN FINANCIAL GROUP INC
For the period ended Dec 31, 2025. Filed Feb 25, 2026.
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FY2025 · Filed Feb 25, 2026
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Holding Company, Other and Unallocated
Holding Company, Other and Unallocated — Results of Operations
AFG’s net pretax loss outside of its property and casualty insurance segment (excluding realized gains and losses) totaled $54 million in the fourth quarter of 2025 compared to $48 million in the fourth quarter of 2024, an increase of $6 million (13%).
The following table details AFG’s loss before income taxes from operations outside of its property and casualty insurance segment for the three months ended December 31, 2025 and 2024 (dollars in millions):
| Three months ended December 31, | |||
|---|---|---|---|
| 2025 | 2024 | % Change | |
| Revenues: | |||
| Net investment income | $7 | $7 | —% |
| Other income — P&C fees | 27 | 28 | (4%) |
| Other income | 4 | 6 | (33%) |
| Total revenues | 38 | 41 | (7%) |
| Costs and Expenses: | |||
| P&C — loss adjustment and underwriting expenses | 5 | 13 | (62%) |
| Other expense — expenses associated with P&C fees | 22 | 15 | 47% |
| Other expenses | 42 | 42 | —% |
| Costs and expenses, excluding interest charges on borrowed money | 69 | 70 | (1%) |
| Loss before income taxes, excluding realized gains and losses and interest charges on borrowed money | (31) | (29) | 7% |
| Interest charges on borrowed money | 23 | 19 | 21% |
| Loss before income taxes, excluding realized gains and losses | $(54) | $(48) | 13% |
Holding Company and Other — Net Investment Income
AFG recorded net investment income on investments held outside of its property and casualty insurance segment of $7 million in both the fourth quarter of 2025 and 2024.
Holding Company and Other — P&C Fees and Related Expenses
Summit, a workers’ compensation insurance subsidiary, collects fees from a small group of unaffiliated insurers for providing underwriting, policy administration and claims services. In addition, certain of AFG’s property and casualty insurance businesses collect fees from customers for ancillary services such as workplace safety programs and premium financing. In the fourth quarter of 2025, AFG collected $27 million in fees for these services compared to $28 million in the fourth quarter of 2024. Management views this fee income, net of the $22 million in the fourth quarter of 2025 and $15 million in the fourth quarter of 2024 in expenses incurred to generate such fees, as a reduction in the cost of underwriting its property and casualty insurance policies. The expenses related to providing such services are embedded in property and casualty underwriting expenses. Consistent with internal management reporting, these fees and the related expenses are netted and recorded as a reduction of commissions and other underwriting expenses in AFG’s segmented results.
Holding Company and Other — Other Income
Other income in the table above includes $3 million and $4 million in the fourth quarter of 2025 and the fourth quarter of 2024, respectively, in management fees paid to AFG by the AFG-managed CLOs (AFG’s consolidated managed investment entities). The management fees are eliminated in consolidation — see the other income line in the Consolidate MIEs column under“Results of Operations — Segmented Statement of Earnings.” Excluding amounts eliminated in consolidation, AFG recorded other income outside of its property and casualty insurance segment of $1 million and $2 million in the fourth quarter of 2025 and the fourth quarter of 2024, respectively.
Holding Company and Other — Other Expenses
AFG’s holding companies and other operations outside of its property and casualty insurance segment recorded other expenses of $42 million in both the fourth quarter of 2025 and 2024.
Holding Company and Other — Interest Charges on Borrowed Money
AFG’s holding companies and other operations outside of its property and casualty insurance segment recorded interest expense of $23 million in the fourth quarter of 2025 compared to $19 million in the fourth quarter of 2024, an increase of $4 million (21%) reflecting the issuance of $350 million principal amount of 5.00% Senior Notes in September 2025.
Realized Gains (Losses) on Securities
AFG’s realized gains (losses) on securities were net losses of $7 million in the fourth quarter of 2025 compared to $10 million in the fourth quarter of 2024, a decrease of $3 million (30%). Realized gains (losses) on securities consisted of the following (in millions):
| Three months ended December 31, | ||
|---|---|---|
| 2025 | 2024 | |
| Realized gains (losses) before impairment allowances: | ||
| Disposals | $2 | $— |
| Change in the fair value of equity securities | (1) | 3 |
| Change in the fair value of derivatives | — | (3) |
| 1 | — | |
| Change in allowance for impairments on securities | (8) | (10) |
| Realized gains (losses) on securities | $(7) | $(10) |
The $3 million net realized gain from the change in the fair value of equity securities in the fourth quarter of 2024 includes gains of $4 million on investments in technology companies.
The $8 million change in allowance for impairments on securities in the fourth quarter of 2025 relates primarily to allowances on fixed maturities related to commercial real estate funds.
The $10 million change in allowance for impairments on securities in the fourth quarter of 2024 relates primarily to an allowance taken on fixed maturities from a single issuer in the retail sector.
Consolidated Income Taxes
AFG’s consolidated provision for income taxes was $80 million for the fourth quarter of 2025 compared to $65 million in the fourth quarter of 2024, an increase of $15 million (23%). The following is a reconciliation of income taxes at the statutory rate to the provision for income taxes as shown in the segmented statement of earnings (dollars in millions):
| Three months ended December 31, | ||||
|---|---|---|---|---|
| 2025 | 2024 | |||
| Amount | % of EBT | Amount | % of EBT | |
| Earnings before income taxes (“EBT”) | $379 | $320 | ||
| Income taxes at statutory rate | $79 | 21% | $67 | 21% |
| Effect of: | ||||
| State and local income taxes, net of federal income tax effect | 1 | —% | 3 | 1% |
| Cross-border tax laws | 1 | —% | — | —% |
| Impact of nontaxable or nondeductible items: | ||||
| Tax preference investments | (1) | —% | (2) | (1%) |
| Other | — | —% | (3) | (1%) |
| Provision for income taxes | $80 | 21% | $65 | 20% |
See Note L — “Income Taxes” to the financial statements for an analysis of items affecting AFG’s effective tax rate.
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