American Financial Group Reports Strong Q2 2026 Earnings of $248 Million

American Financial Group, Inc. (AFG) reported a strong financial performance for the second quarter of 2026, with net earnings reaching $248 million, or $2.99 per diluted share, compared to $174 million, or $2.07 per diluted share, in the same period last year. For the first half of 2026, net earnings totaled $439 million, or $5.28 per diluted share, up from $328 million, or $3.92 per diluted share, in the first half of 2025. The increase in earnings was attributed to higher underwriting profits and improved net investment income from AFG's alternative investment portfolio.

In terms of revenue, AFG reported total revenues of $2.03 billion for the second quarter of 2026, a 5.5% increase from $1.92 billion in the prior year. For the first six months, total revenues were $3.88 billion, compared to $3.78 billion in the same period of 2025. The growth in revenue was driven by an increase in net earned premiums, which rose to $1.69 billion in the second quarter, up 2.9% from $1.65 billion in the previous year, and $3.30 billion for the first half, a 2.3% increase from $3.23 billion.

AFG's property and casualty insurance segment reported a significant increase in underwriting profit, which reached $350 million in the second quarter of 2026, compared to $273 million in the same quarter of 2025. The combined ratio improved to 91.5% from 93.1%, indicating better underwriting performance. Gross written premiums for the second quarter increased by 7% to $2.85 billion, driven by new business opportunities and favorable renewal rates. The company also experienced a favorable development in prior year reserves, with net favorable reserve development of $57 million in the second quarter of 2026.

Operationally, AFG's investment portfolio remains robust, with total cash and investments amounting to $17.07 billion as of June 30, 2026. The company reported net investment income of $221 million for the second quarter, a 20% increase from $184 million in the same quarter of 2025. AFG's alternative investments contributed significantly to this growth, with net investment income from these sources rising sharply. The company continues to maintain a strong liquidity position, with cash and cash equivalents at $1.44 billion, down from $1.73 billion at the end of 2025.

Looking ahead, AFG's management expressed optimism about continued premium growth and strong underwriting results, despite some softening in certain markets. The company anticipates improved returns on alternative investments, which are expected to positively impact net investment income in the latter half of 2026. AFG's strong financial position and capital levels at its subsidiaries are expected to provide the flexibility needed to navigate potential challenges in the economic and regulatory landscape.