Segments of Operations

12 Months Ended

Dec. 31, 2016

Segment Reporting [Abstract]

Segments of Operations

Segments of Operations

AFG manages its business as four segments: (i) Property and casualty insurance, (ii) Annuity, (iii) Run-off long-term care and life and (iv) Other, which includes holding company assets and costs, and the assets 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, trucks and recreational vehicles, inland and ocean marine, agricultural-related products and other property coverages, (ii) Specialty casualty, which includes primarily excess and surplus, general liability, executive liability, professional liability, umbrella and excess liability, specialty coverage 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 leasing and financing institutions (including collateral and lender-placed mortgage property insurance), surety and fidelity 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 markets traditional fixed and fixed-indexed annuities in the retail, financial institutions and education markets. AFG’s reportable segments and their components were determined based primarily upon similar economic characteristics, products and services.

Sales of property and casualty insurance outside of the United States represented 4% of AFG’s revenues in 2016 and 2015 and 5% of AFG’s revenues in 2014.

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

	2016		2015		2014
Assets
Property and casualty insurance (a)	$	15,574	$	14,689	$	14,069
Annuity	33,409		29,865		27,317
Run-off long-term care and life (b)	752		772		2,489
Other	5,337		4,511		3,638
Total assets	$	55,072	$	49,837	$	47,513

Revenues
Property and casualty insurance:
Premiums earned:
Specialty
Property and transportation	$	1,662	$	1,599		$	1,544
Specialty casualty	2,006		2,011			1,765
Specialty financial	557		517			469
Other specialty	103		97			100
Total premiums earned	4,328		4,224			3,878
Net investment income	350		319			294
Other income (c)	51		78			9
Total property and casualty insurance	4,729		4,621			4,181
Annuity:
Net investment income	1,356		1,224			1,136
Other income	103		98			97
Total annuity	1,459		1,322			1,233
Run-off long-term care and life (b)	49		188			195
Other	240		194			72
Total revenues before realized gains (losses)	6,477		6,325			5,681
Realized gains (losses) on securities	19		(19		)	52
Realized gains (losses) on subsidiaries	2		(161		)	—
Total revenues	$	6,498	$	6,145		$	5,733

(a) Not allocable to sub-segments.

(b) AFG sold substantially all of its run-off long-term care insurance business in December 2015.

(c) Includes pretax income of $32 million (before noncontrolling interest) from the sale of an apartment property in the second quarter of 2016, $51 million (before noncontrolling interest) from the sale of a hotel in the second quarter of 2015 and $15 million from the sale of an apartment property in the fourth quarter of 2015.

	2016			2015			2014
Earnings Before Income Taxes
Property and casualty insurance:
Underwriting:
Specialty
Property and transportation	$	166		$	48		$	21
Specialty casualty	78			146			136
Specialty financial	84			87			64
Other specialty	9			14			16
Other lines (a)	(101		)	(70		)	(25		)
Total underwriting	236			225			212
Investment and other income, net (b)	341			351			244
Total property and casualty insurance	577			576			456
Annuity	368			331			328
Run-off long-term care and life (c)	2			14			(10		)
Other (d)	(181		)	(176		)	(200		)
Total earnings before realized gains (losses) and income taxes	766			745			574
Realized gains (losses) on securities	19			(19		)	52
Realized gains (losses) on subsidiaries	2			(161		)	—
Total earnings before income taxes	$	787		$	565		$	626

(a) Includes a special charge of $65 million related to the exit of certain lines of business within AFG’s Lloyd’s-based insurer, Neon, in the second quarter of 2016 and special charges to increase asbestos and environmental (“A&E”) reserves of $36 million, $67 million and $24 million in 2016, 2015 and 2014, respectively.

(b) Includes pretax income of $32 million (before noncontrolling interest) from the sale of an apartment property in the second quarter of 2016, $51 million (before noncontrolling interest) from the sale of a hotel in the second quarter of 2015 and $15 million from the sale of an apartment property in the fourth quarter of 2015.

(c) AFG sold substantially all of its run-off long-term care insurance business in December 2015.

(d) Primarily holding company interest and expenses, including a $4 million loss on retirement of debt in the third quarter of 2015, and special charges to increase A&E reserves related to AFG’s former railroad and manufacturing operations ($5 million in 2016, $12 million in 2015 and $6 million in 2014) and losses of managed investment entities attributable to noncontrolling interests ($51 million in 2014). Following the adoption of new guidance in the first quarter of 2015, there are no longer earnings (losses) of managed investment entities that are attributable to noncontrolling interests. See Note A— “Accounting Policies— Managed Investment Entities.”