American Financial Group Reports Decline in Net Earnings for Q2 and First Half of 2025

American Financial Group, Inc. (AFG) reported its financial results for the second quarter and first half of 2025, revealing a decline in net earnings compared to the same periods in 2024. For the second quarter, AFG's net earnings were $174 million, or $2.07 per diluted share, down from $209 million, or $2.49 per share, in the prior year. For the first six months, net earnings totaled $328 million, or $3.92 per share, compared to $451 million, or $5.38 per share, in 2024. The decrease in earnings was attributed to lower underwriting profit and reduced net investment income from alternative investments, partially offset by higher investment income from fixed maturity investments.

In terms of revenue, AFG reported total revenues of $1.924 billion for the second quarter of 2025, a slight increase from $1.900 billion in the same quarter of 2024. For the first half of 2025, total revenues were $3.780 billion, down from $3.806 billion in the previous year. The company experienced a 4% increase in net earned premiums, which reached $1.647 billion in the second quarter and $3.227 billion in the first half, compared to $1.585 billion and $3.131 billion, respectively, in 2024. This growth was driven by increased gross written premiums, particularly in the property and transportation segment.

AFG's property and casualty insurance segment reported a pretax earnings contribution of $273 million for the second quarter of 2025, down from $319 million in the same quarter of 2024. The combined ratio for the segment increased to 93.1% from 90.5%, indicating a decline in underwriting profitability. The loss and loss adjustment expense (LAE) ratio rose to 61.1%, compared to 59.1% in the prior year, reflecting higher claims costs. The company noted that overall catastrophe losses were $38 million in the second quarter of 2025, slightly higher than the $36 million reported in the same period of 2024.

Operationally, AFG's total assets decreased to $30.669 billion as of June 30, 2025, from $30.836 billion at the end of 2024. The company reported a total cash and investments balance of $16.049 billion, up from $15.852 billion. AFG's long-term debt remained stable at $1.476 billion. The company continues to focus on premium growth across its business units and anticipates that the favorable property and casualty insurance market will support its performance moving forward. Management expects the elevated interest rate environment to positively impact investment income in the coming periods.