Segments of Operations

12 Months Ended

Dec. 31, 2019

AFG manages its business as three segments: (i) Property and casualty insurance, (ii) Annuity and (iii) Other, which includes holding company assets and costs, revenues and costs of AFG’s limited insurance operations outside of property and casualty insurance and annuity segments, 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 and 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.

Sales of property and casualty insurance outside of the United States represented 7% of AFG’s revenues in 2019 and in 2018 and 5% of AFG’s revenues in 2017. Approximately two-thirds of these 2019 sales were through the Neon Lloyd’s of London business, which AFG is exiting and will no longer write property and casualty business (beginning in early 2020).

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



	2019		2018		2017
Assets
Property and casualty insurance (a)	$	19,098	$	17,681	$	17,171
Annuity	45,074		39,952		37,179
Other	5,958		5,823		6,308
Total assets	$	70,130	$	63,456	$	60,658



Revenues
Property and casualty insurance:
Premiums earned:
Specialty
Property and transportation	$	1,828	$	1,729		$	1,711
Specialty casualty	2,597		2,403			2,186
Specialty financial	610		598			576
Other specialty	150		135			106
Total premiums earned	5,185		4,865			4,579
Net investment income	472		438			362
Other income	11		10			28
Total property and casualty insurance	5,668		5,313			4,969
Annuity:
Net investment income	1,792		1,638			1,458
Other income	108		107			103
Total annuity	1,900		1,745			1,561
Other	382		358			330
Total revenues before realized gains (losses)	7,950		7,416			6,860
Realized gains (losses) on securities	287		(266		)	5
Total revenues	$	8,237	$	7,150		$	6,865


(a)	Not allocable to sub-segments.



	2019			2018			2017
Earnings Before Income Taxes
Property and casualty insurance:
Underwriting:
Specialty
Property and transportation	$	79		$	120		$	154
Specialty casualty	175			141			104
Specialty financial	92			66			61
Other specialty	(21		)	(5		)	(2		)
Other lines (a)	(113		)	(20		)	(75		)
Total underwriting	212			302			242
Investment and other income, net	437			407			349
Total property and casualty insurance	649			709			591
Annuity	362			361			380
Other (b)	(190		)	(165		)	(252		)
Total earnings before realized gains (losses) and income taxes	821			905			719
Realized gains (losses) on securities	287			(266		)	5
Total earnings before income taxes	$	1,108		$	639		$	724


(a)	Includes special charges to increase asbestos and environmental (“A&E”) reserves of $18 million in both 2019 and 2018 and $89 million in 2017, respectively. Also includes a $76 million charge in 2019 and $18 million in favorable development recorded in 2017 related to the Neon exited lines.

(b)

Primarily holding company interest and expenses, including losses on retirement of debt of $5 million in 2019 and $51 million in 2017 and special charges to increase A&E reserves related to AFG’s former railroad and manufacturing operations ($11 million in 2019, $9 million in 2018 and $24 million in 2017).