American Financial (AFG) 8-K American Financial Group, Inc. Announces Fourth Quarter and Full Year Results

Exhibit 99.2

	American Financial Group, Inc. Investor Supplement - Fourth Quarter 2018
	January 31, 2019
	American Financial Group, Inc.
	Corporate Headquarters
	Great American Insurance Group Tower 301 E Fourth Street
	Cincinnati, OH 45202 513 579 6739

American Financial Group, Inc. Table of Contents - Investor Supplement - Fourth Quarter 2018

Section	Page
Table of Contents - Investor Supplement - Fourth Quarter 2018		2
Financial Highlights		3
Summary of Earnings		4
Earnings Per Share Summary		5
Property and Casualty Insurance Segment
Property and Casualty Insurance - Summary Underwriting Results (GAAP)		6
Specialty - Underwriting Results (GAAP)		7
Property and Transportation - Underwriting Results (GAAP)		8
Specialty Casualty - Underwriting Results (GAAP)		9
Specialty Financial - Underwriting Results (GAAP)		10
Other Specialty - Underwriting Results (GAAP)		11
Annuity Segment
Annuity Earnings (GAAP)		12
Analysis of Annuity Earnings Before Impact of Fair Value Accounting for FIAs and Unlockings		13
Analysis of Impact of Fair Value Accounting for FIAs		14
Detail of Annuity Benefits Expense (GAAP)		15
Net Spread on Fixed Annuities (GAAP)		16
Statutory Annuity Premiums		17
Fixed Annuity Benefits Accumulated (GAAP)		18
Guaranteed Minimum Interest Rate Analysis		19
Consolidated Balance Sheet / Book Value / Debt
Consolidated Balance Sheet		20
Book Value Per Share and Price / Book Summary		21
Capitalization		22
Additional Supplemental Information		23
Consolidated Investment Supplement
Total Cash and Investments		24
Net Investment Income		25
InvestmentsMarked-to-Market Through Investment Income and Investments Accounted For Using the Equity Method		26
Fixed Maturities - By Security Type - AFG Consolidated		27
Fixed Maturities - By Security Type Portfolio		28
Fixed Maturities - Credit Rating		29
Mortgage-Backed Securities - AFG Consolidated		30
Mortgage-Backed Securities Portfolio		31
Mortgage-Backed Securities - Credit Rating		32
Appendix
A. Fixed Maturities - Credit Rating by Type		33

Page 2

American Financial Group, Inc. Financial Highlights (in millions, except per share information)

	Three Months Ended															Twelve Months Ended
	12/31/18			9/30/18			6/30/18			3/31/18			12/31/17			12/31/18			12/31/17
Highlights
Net earnings (loss)	$	(29	)	$	204		$	210		$	145		$	166		$	530		$	475
Core net operating earnings		159			198			185			219			197			761			588
Total assets		63,456			64,190			61,834			60,656			60,658			63,456			60,658
Adjusted shareholders’ equity (a)		4,898			5,103			4,920			4,865			4,724			4,898			4,724
Property and Casualty net written premiums		1,208			1,456			1,257			1,102			1,161			5,023			4,751
Annuity statutory premiums		1,482			1,378			1,399			1,148			909			5,407			4,341
Per share data
Diluted earnings per share	$	(0.33	)	$	2.26		$	2.31		$	1.60		$	1.84		$	5.85		$	5.28
Core net operating earnings per share		1.75			2.19			2.04			2.42			2.20			8.40			6.55
Adjusted book value per share (a)		54.86			57.22			55.24			54.74			53.51			54.86			53.51
Cash dividends per common share		1.9000			0.3500			1.8500			0.3500			2.3500			4.4500			4.7875
Financial ratios
Annualized return on equity (b)		(2.3	%)		16.3	%		17.1	%		12.3	%		14.4	%		10.9	%		10.3	%
Annualized core operating return on equity (b)		12.6	%		15.8	%		15.1	%		18.6	%		17.2	%		15.6	%		12.7	%
Property and Casualty combined ratio - Specialty:
Loss & LAE ratio		62.7	%		64.3	%		59.7	%		57.8	%		59.8	%		61.3	%		62.9	%
Underwriting expense ratio		29.3	%		31.4	%		34.0	%		33.9	%		27.5	%		32.1	%		30.2	%
Combined ratio - Specialty		92.0	%		95.7	%		93.7	%		91.7	%		87.3	%		93.4	%		93.1	%
Net spread on fixed annuities:
Net interest spread		2.58	%		2.67	%		2.81	%		2.75	%		2.62	%		2.70	%		2.62	%
Net spread earned:
Before impact of fair value accounting and unlockings		0.81	%		1.37	%		1.46	%		1.38	%		1.40	%		1.26	%		1.34	%
Impact of fair value accounting (c)		(0.52	%)		(0.02	%)		0.04	%		0.16	%		(0.13	%)		(0.10	%)		(0.10	%)
Unlockings		(0.04	%)		0.00	%		(0.32	%)		0.00	%		(0.06	%)		(0.09	%)		(0.01	%)
After impact of fair value accounting and unlockings		0.25	%		1.35	%		1.18	%		1.54	%		1.21	%		1.07	%		1.23	%

(a) Excludes unrealized gains related to fixed maturity investments, a reconciliation to the GAAP measure is on page 19.

(b) Excludes accumulated other comprehensive income.

(c) Change in fair value of derivatives offset by the estimated related adjustments to amortization of deferred sales inducements and deferred policy acquisition costs.

Page 3

American Financial Group, Inc. Summary of Earnings ($ in millions)

	Three Months Ended															Twelve Months Ended
	12/31/18			09/30/18			06/30/18			3/31/18			12/31/17			12/31/18			12/31/17
Property and Casualty Insurance
Underwriting profit	$	101		$	56		$	72		$	91		$	155		$	320		$	313
Net investment income		115			108			115			100			86			438			362
Other income (expense)		(2	)		(6	)		(7	)		(3	)		(8	)		(18	)		(15	)
Property and Casualty Insurance operating earnings		214			158			180			188			233			740			660
Annuity earnings		20			117			99			125			97			361			380
Interest expense of parent holding companies		(16	)		(15	)		(16	)		(15	)		(20	)		(62	)		(85	)
Other expense		(13	)		(22	)		(32	)		(27	)		(27	)		(94	)		(92	)
Pre-tax core operating earnings		205			238			231			271			283			945			863
Income tax expense		46			40			46			52			86			184			275
Core net operating earnings		159			198			185			219			197			761			588
Non-core items, net of tax:
Realized gains (losses) on securities		(188	)		27			25			(74	)		4			(210	)		3
Special A&E charges:
Property and Casualty Insurancerun-off operations		—			(14	)		—			—			—			(14	)		(58	)
Former Railroad and Manufacturing operations		—			(7	)		—			—			—			(7	)		(16	)
Neon exited lines charge		—			—			—			—			18			—			18
Tax benefit related to Neon restructuring		—			—			—			—			56			—			56
Tax expense related to change in U.S. corporate tax rate		—			—			—			—			(83	)		—			(83	)
Loss on retirement of debt		—			—			—			—			(26	)		—			(33	)
Net earnings	$	(29	)	$	204		$	210		$	145		$	166		$	530		$	475

Page 4

American Financial Group, Inc. Earnings Per Share Summary (in millions, except per share information)

	Three Months Ended														Twelve Months Ended
	12/31/18			9/30/18			6/30/18		3/31/18			12/31/17			12/31/18			12/31/17
Core net operating earnings	$	159		$	198		$	185	$	219		$	197		$	761		$	588
Net earnings	$	(29	)	$	204		$	210	$	145		$	166		$	530		$	475
Average number of diluted shares - core		90.668			90.731			90.663		90.431			90.109			90.626			89.812
Average number of diluted shares - net		89.278			90.731			90.663		90.431			90.109			90.626			89.812
Diluted earnings per share:
Core net operating earnings per share	$	1.75		$	2.19		$	2.04	$	2.42		$	2.20		$	8.40		$	6.55
Realized gains (losses) on securities		(2.08	)		0.31			0.27		(0.82	)		0.04			(2.31	)		0.03
Special A&E charges:
Property and Casualty Insurancerun-off operations		—			(0.16	)		—		—			—			(0.16	)		(0.64	)
Former Railroad and Manufacturing operations		—			(0.08	)		—		—			—			(0.08	)		(0.18	)
Neon exited lines charge		—			—			—		—			0.19			—			0.19
Tax benefit related to Neon restructuring		—			—			—		—			0.62			—			0.62
Tax expense related to change in U.S. corporate tax rate		—			—			—		—			(0.92	)		—			(0.92	)
Loss on retirement of debt		—			—			—		—			(0.29	)		—			(0.37	)
Diluted earnings per share	$	(0.33	)	$	2.26		$	2.31	$	1.60		$	1.84		$	5.85		$	5.28

Page 5

American Financial Group, Inc. Property and Casualty Insurance - Summary Underwriting Results (GAAP) ($ in millions) �� 

	Three Months Ended															Twelve Months Ended
	12/31/18			9/30/18			6/30/18			3/31/18			12/31/17			12/31/18			12/31/17
Property and Transportation	$	64		$	—		$	23		$	33		$	84		$	120		$	154
Specialty Casualty		22			49			29			41			58			141			104
Specialty Financial		20			9			22			15			19			66			61
Other Specialty		(4	)		(3	)		(1	)		3			(5	)		(5	)		(2	)
Underwriting profit - Specialty		102			55			73			92			156			322			317
Other core charges, included in loss and LAE		1			(1	)		1			1			1			2			4
Underwriting profit - Core		101			56			72			91			155			320			313
Special A&E charges, included in loss and LAE		—			(18	)		—			—			—			(18	)		(89	)
Neon exited lines charge, included in loss and LAE		—			—			—			—			18			—			18
Underwriting profit (loss) - Property and Casualty Insurance	$	101		$	38		$	72		$	91		$	173		$	302		$	242
Included in results above:
Current accident year catastrophe losses:
Catastrophe reinstatement premium	$	(1	)	$	3		$	—		$	—		$	4		$	2		$	10
Catastrophe loss		39			35			16			13			8			103			140
Total current accident year catastrophe losses	$	38		$	38		$	16		$	13		$	12		$	105		$	150
Prior year loss reserve development (favorable) / adverse	$	(61	)	$	(31	)	$	(44	)	$	(56	)	$	(66	)	$	(192	)	$	(64	)
Combined ratio:
Property and Transportation		86.5	%		100.0	%		93.9	%		90.4	%		82.6	%		93.1	%		91.0	%
Specialty Casualty		96.5	%		92.1	%		95.1	%		92.9	%		90.0	%		94.2	%		95.2	%
Specialty Financial		85.5	%		94.4	%		85.6	%		90.2	%		86.2	%		88.9	%		89.4	%
Other Specialty		112.3	%		103.0	%		105.5	%		90.7	%		123.0	%		103.7	%		102.7	%
Combined ratio - Specialty		92.0	%		95.7	%		93.7	%		91.7	%		87.3	%		93.4	%		93.1	%
Other core charges		0.0	%		0.0	%		0.0	%		0.1	%		0.1	%		0.0	%		0.1	%
Neon exited lines charge, loss and LAE		0.0	%		0.0	%		0.0	%		0.0	%		(1.4	%)		0.0	%		(0.4	%)
Special A&E charges		0.0	%		1.5	%		0.0	%		0.0	%		0.0	%		0.4	%		1.9	%
Combined ratio		92.0	%		97.2	%		93.7	%		91.8	%		86.0	%		93.8	%		94.7	%
Combined ratio excl. catastrophe and prior year development		93.7	%		96.8	%		96.2	%		95.6	%		90.8	%		95.7	%		93.1	%
Loss and LAE components - property and casualty insurance
Current accident year, excluding catastrophe loss		64.4	%		65.4	%		62.2	%		61.7	%		63.3	%		63.6	%		62.9	%
Prior accident year loss reserve development		(4.7	%)		(2.2	%)		(3.9	%)		(5.0	%)		(5.4	%)		(4.0	%)		(1.4	%)
Current accident year catastrophe loss		3.0	%		2.6	%		1.4	%		1.2	%		0.6	%		2.1	%		3.0	%
Loss and LAE ratio		62.7	%		65.8	%		59.7	%		57.9	%		58.5	%		61.7	%		64.5	%

Page 6

American Financial Group, Inc. Specialty - Underwriting Results (GAAP) ($ in millions)

	Three Months Ended															Twelve Months Ended
	12/31/18			9/30/18			6/30/18			3/31/18			12/31/17			12/31/18			12/31/17
Gross written premiums	$	1,613		$	2,104		$	1,665		$	1,458		$	1,571		$	6,840		$	6,502
Ceded reinsurance premiums		(405	)		(648	)		(408	)		(356	)		(410	)		(1,817	)		(1,751	)
Net written premiums		1,208			1,456			1,257			1,102			1,161			5,023			4,751
Change in unearned premiums		62			(129	)		(96	)		5			64			(158	)		(172	)
Net earned premiums		1,270			1,327			1,161			1,107			1,225			4,865			4,579
Loss and LAE		796			855			692			640			733			2,983			2,880
Underwriting expense		372			417			396			375			336			1,560			1,382
Underwriting profit	$	102		$	55		$	73		$	92		$	156		$	322		$	317
Included in results above:
Current accident year catastrophe losses:
Catastrophe reinstatement premium	$	(1	)	$	3		$	—		$	—		$	4		$	2		$	10
Catastrophe loss		39			35			16			13			8			103			140
Total current accident year catastrophe losses	$	38		$	38		$	16		$	13		$	12		$	105		$	150
Prior year loss reserve development (favorable) / adverse	$	(61	)	$	(49	)	$	(45	)	$	(57	)	$	(49	)	$	(212	)	$	(139	)
Combined ratio:
Loss and LAE ratio		62.7	%		64.3	%		59.7	%		57.8	%		59.8	%		61.3	%		62.9	%
Underwriting expense ratio		29.3	%		31.4	%		34.0	%		33.9	%		27.5	%		32.1	%		30.2	%
Combined ratio		92.0	%		95.7	%		93.7	%		91.7	%		87.3	%		93.4	%		93.1	%
Combined ratio excl. catastrophe and prior year development		93.7	%		96.8	%		96.2	%		95.6	%		90.8	%		95.7	%		93.1	%
Loss and LAE components:
Current accident year, excluding catastrophe loss		64.4	%		65.4	%		62.2	%		61.7	%		63.3	%		63.6	%		62.9	%
Prior accident year loss reserve development		(4.7	%)		(3.7	%)		(3.9	%)		(5.1	%)		(4.1	%)		(4.4	%)		(3.0	%)
Current accident year catastrophe loss		3.0	%		2.6	%		1.4	%		1.2	%		0.6	%		2.1	%		3.0	%
Loss and LAE ratio		62.7	%		64.3	%		59.7	%		57.8	%		59.8	%		61.3	%		62.9	%

Page 7

American Financial Group, Inc. Property and Transportation - Underwriting Results (GAAP) ($ in millions)

	Three Months Ended															Twelve Months Ended
	12/31/18			9/30/18			6/30/18			3/31/18			12/31/17			12/31/18			12/31/17
Gross written premiums	$	651		$	953		$	615		$	426		$	626		$	2,645		$	2,688
Ceded reinsurance premiums		(203	)		(393	)		(193	)		(102	)		(202	)		(891	)		(923	)
Net written premiums		448			560			422			324			424			1,754			1,765
Change in unearned premiums		31			(34	)		(48	)		26			61			(25	)		(54	)
Net earned premiums		479			526			374			350			485			1,729			1,711
Loss and LAE		327			406			239			220			325			1,192			1,172
Underwriting expense		88			120			112			97			76			417			385
Underwriting profit	$	64		$	—		$	23		$	33		$	84		$	120		$	154
Included in results above:
Current accident year catastrophe losses:
Catastrophe reinstatement premium	$	(1	)	$	1		$	—		$	—		$	—		$	—		$	2
Catastrophe loss		(1	)		12			10			5			(3	)		26			36
Total current accident year catastrophe losses	$	(2	)	$	13		$	10		$	5		$	(3	)	$	26		$	38
Prior year loss reserve development (favorable) / adverse	$	(7	)	$	(4	)	$	(21	)	$	(18	)	$	(4	)	$	(50	)	$	(40	)
Combined ratio:
Loss and LAE ratio		68.2	%		77.1	%		63.8	%		63.0	%		67.1	%		69.0	%		68.5	%
Underwriting expense ratio		18.3	%		22.9	%		30.1	%		27.4	%		15.5	%		24.1	%		22.5	%
Combined ratio		86.5	%		100.0	%		93.9	%		90.4	%		82.6	%		93.1	%		91.0	%
Combined ratio excl. catastrophe and prior year development		88.2	%		98.5	%		96.8	%		94.1	%		84.0	%		94.4	%		91.2	%
Loss and LAE components:
Current accident year, excluding catastrophe loss		69.9	%		75.6	%		66.7	%		66.7	%		68.5	%		70.3	%		68.7	%
Prior accident year loss reserve development		(1.5	%)		(0.8	%)		(5.6	%)		(5.1	%)		(0.8	%)		(2.8	%)		(2.3	%)
Current accident year catastrophe loss		(0.2	%)		2.3	%		2.7	%		1.4	%		(0.6	%)		1.5	%		2.1	%
Loss and LAE ratio		68.2	%		77.1	%		63.8	%		63.0	%		67.1	%		69.0	%		68.5	%

Page 8

American Financial Group, Inc. Specialty Casualty - Underwriting Results (GAAP) ($ in millions)

	Three Months Ended															Twelve Months Ended
	12/31/18			9/30/18			6/30/18			3/31/18			12/31/17			12/31/18			12/31/17
Gross written premiums	$	778		$	956		$	858		$	853		$	737		$	3,445		$	3,087
Ceded reinsurance premiums		(197	)		(261	)		(219	)		(259	)		(182	)		(936	)		(807	)
Net written premiums		581			695			639			594			555			2,509			2,280
Change in unearned premiums		32			(79	)		(44	)		(15	)		18			(106	)		(94	)
Net earned premiums		613			616			595			579			573			2,403			2,186
Loss and LAE		389			364			378			345			338			1,476			1,410
Underwriting expense		202			203			188			193			177			786			672
Underwriting profit	$	22		$	49		$	29		$	41		$	58		$	141		$	104
Included in results above:
Current accident year catastrophe losses:
Catastrophe reinstatement premium	$	—		$	1		$	—		$	—		$	4		$	1		$	6
Catastrophe loss		28			11			1			5			14			45			71
Total current accident year catastrophe losses	$	28		$	12		$	1		$	5		$	18		$	46		$	77
Prior year loss reserve development (favorable) / adverse	$	(52	)	$	(37	)	$	(15	)	$	(35	)	$	(52	)	$	(139	)	$	(86	)
Combined ratio:
Loss and LAE ratio		63.5	%		59.2	%		63.4	%		59.5	%		59.1	%		61.5	%		64.5	%
Underwriting expense ratio		33.0	%		32.9	%		31.7	%		33.4	%		30.9	%		32.7	%		30.7	%
Combined ratio		96.5	%		92.1	%		95.1	%		92.9	%		90.0	%		94.2	%		95.2	%
Combined ratio excl. catastrophe and prior year development		100.3	%		96.4	%		97.5	%		97.9	%		96.7	%		98.1	%		95.9	%
Loss and LAE components:
Current accident year, excluding catastrophe loss		67.3	%		63.5	%		65.8	%		64.5	%		65.8	%		65.4	%		65.2	%
Prior accident year loss reserve development		(8.5	%)		(6.0	%)		(2.5	%)		(6.0	%)		(9.2	%)		(5.8	%)		(4.0	%)
Current accident year catastrophe loss		4.7	%		1.7	%		0.1	%		1.0	%		2.5	%		1.9	%		3.3	%
Loss and LAE ratio		63.5	%		59.2	%		63.4	%		59.5	%		59.1	%		61.5	%		64.5	%

Page 9

American Financial Group, Inc. Specialty Financial - Underwriting Results (GAAP) ($ in millions)

	Three Months Ended															Twelve Months Ended
	12/31/18			9/30/18			6/30/18			3/31/18			12/31/17			12/31/18			12/31/17
Gross written premiums	$	184		$	195		$	192			179		$	208		$	750		$	727
Ceded reinsurance premiums		(42	)		(42	)		(33	)		(31	)		(52	)		(148	)		(131	)
Net written premiums		142			153			159			148			156			602			596
Change in unearned premiums		(1	)		(4	)		—			1			(15	)		(4	)		(20	)
Net earned premiums		141			149			159			149			141			598			576
Loss and LAE		51			60			54			60			47			225			227
Underwriting expense		70			80			83			74			75			307			288
Underwriting profit (loss)	$	20		$	9		$	22		$	15		$	19		$	66		$	61
Included in results above:
Current accident year catastrophe losses:
Catastrophe reinstatement premium	$	—		$	1		$	—		$	—		$	—		$	1		$	2
Catastrophe loss		10			12			3			3			(5	)		28			30
Total current accident year catastrophe losses	$	10		$	13		$	3		$	3		$	(5	)	$	29		$	32
Prior year loss reserve development (favorable) / adverse	$	(7	)	$	(8	)	$	(8	)	$	(3	)	$	1		$	(26	)	$	(21	)
Combined ratio:
Loss and LAE ratio		36.4	%		40.1	%		33.9	%		40.2	%		33.1	%		37.6	%		39.4	%
Underwriting expense ratio		49.1	%		54.3	%		51.7	%		50.0	%		53.1	%		51.3	%		50.0	%
Combined ratio		85.5	%		94.4	%		85.6	%		90.2	%		86.2	%		88.9	%		89.4	%
Combined ratio excl. catastrophe and prior year development		83.6	%		91.5	%		89.0	%		90.2	%		89.1	%		88.6	%		87.8	%
Loss and LAE components:
Current accident year, excluding catastrophe loss		34.5	%		37.2	%		37.3	%		40.2	%		36.0	%		37.3	%		37.8	%
Prior accident year loss reserve development		(5.2	%)		(5.1	%)		(5.4	%)		(1.8	%)		0.8	%		(4.4	%)		(3.6	%)
Current accident year catastrophe loss		7.1	%		8.0	%		2.0	%		1.8	%		(3.7	%)		4.7	%		5.2	%
Loss and LAE ratio		36.4	%		40.1	%		33.9	%		40.2	%		33.1	%		37.6	%		39.4	%

Page 10

American Financial Group, Inc. Other Specialty - Underwriting Results (GAAP) ($ in millions)

	Three Months Ended															Twelve Months Ended
	12/31/18			9/30/18			6/30/18			3/31/18			12/31/17			12/31/18			12/31/17
Gross written premiums	$	—		$	—		$	—		$	—		$	—		$	—		$	—
Ceded reinsurance premiums		37			48			37			36			26			158			110
Net written premiums		37			48			37			36			26			158			110
Change in unearned premiums		—			(12	)		(4	)		(7	)		—			(23	)		(4	)
Net earned premiums		37			36			33			29			26			135			106
Loss and LAE		29			25			21			15			23			90			71
Underwriting expense		12			14			13			11			8			50			37
Underwriting profit (loss)	$	(4	)	$	(3	)	$	(1	)	$	3		$	(5	)	$	(5	)	$	(2	)
Included in results above:
Current accident year catastrophe losses:
Catastrophe reinstatement premium	$	—		$	—		$	—		$	—		$	—		$	—		$	—
Catastrophe loss		2			—			2			—			2			4			3
Total current accident year catastrophe losses	$	2		$	—		$	2		$	—		$	2		$	4		$	3
Prior year loss reserve development (favorable) / adverse	$	5		$	—		$	(1	)	$	(1	)	$	6		$	3		$	8
Combined ratio:
Loss and LAE ratio		76.5	%		65.5	%		68.7	%		51.3	%		86.2	%		66.4	%		66.9	%
Underwriting expense ratio		35.8	%		37.5	%		36.8	%		39.4	%		36.8	%		37.3	%		35.8	%
Combined ratio		112.3	%		103.0	%		105.5	%		90.7	%		123.0	%		103.7	%		102.7	%
Combined ratio excl. catastrophe and prior year development		95.6	%		103.7	%		99.6	%		96.6	%		94.5	%		99.0	%		93.0	%

Page 11

American Financial Group, Inc. Annuity Earnings (GAAP) ($ in millions)

	Three Months Ended														Twelve Months Ended
	12/31/18			9/30/18			6/30/18			3/31/18		12/31/17			12/31/18			12/31/17
Net investment income	$	419		$	413		$	412		$	394	$	376		$	1,638		$	1,458
Guaranteed withdrawal benefit fees		17			16			16			16		17			65			60
Policy charges and other miscellaneous income		10			11			11			10		7			42			43
Total revenues		446			440			439			420		400			1,745			1,561
Annuity benefits		334			222			260			182		257			998			892
Acquisition expenses		56			69			49			81		15			255			168
Other expenses		36			32			31			32		31			131			121
Total costs and expenses		426			323			340			295		303			1,384			1,181
Annuity earnings before income taxes	$	20		$	117		$	99		$	125	$	97		$	361		$	380
Detail of Annuity earnings before income taxes
Earnings before income taxes, impact of fair value accounting and unlockings	$	71		$	119		$	123		$	112	$	111		$	425		$	416
Impact of fair value accounting		(47	)		(2	)		3			13		(11	)		(33	)		(33	)
Unlockings		(4	)		—			(27	)		—		(3	)		(31	)		(3	)
Earnings before income taxes	$	20		$	117		$	99		$	125	$	97		$	361		$	380

Page 12

American Financial Group, Inc. Analysis of Annuity Earnings Before Impact of Fair Value Accounting for FIAs and Unlockings ($ in millions)

	Three Months Ended															Twelve Months Ended
	12/31/18			9/30/18			6/30/18			3/31/18			12/31/17			12/31/18			12/31/17
Annuity Segment Pretax Earnings:
Annuity earnings before impact of fair value accounting for FIAs, unlockings and items below	$	85		$	83		$	87		$	84		$	91		$	339		$	346
Investments marked to market through operating earnings:
Investment income (from page 26)		18			28			37			31			14			114			53
Associated DAC impact		(2	)		(2	)		(4	)		(2	)		(1	)		(10	)		(4	)
Total		16			26			33			29			13			104			49
Impact of stock market on (a):
Annuities with guaranteed benefits (from page 15)		(22	)		7			2			(1	)		5			(14	)		14
DAC associated with FIAs		(8	)		3			1			—			2			(4	)		7
Total (b)		(30	)		10			3			(1	)		7			(18	)		21
Annuity earnings before impact of fair value accounting for FIAs and unlockings, as reported	$	71		$	119		$	123		$	112		$	111		$	425		$	416
(a)   Change in S&P 500		-14	%		+7	%		+3	%		-1	%		+6	%		-6	%		+19	%
(b)   Estimated impact (in millions of dollars) of a 1% change in the stock market on FIAs before fair value accounting (i.e. 1% “Rule of Thumb”)	$	2		$	1		$	1		$	1		$	1			n/m		$	1

Page 13

American Financial Group, Inc. Analysis of Impact of Fair Value Accounting for FIAs ($ in millions)

	Three Months Ended															Twelve Months Ended
	12/31/18			9/30/18			6/30/18			3/31/18			12/31/17			12/31/18			12/31/17
Interest on Embedded Derivative liability	$	(11	)	$	(10	)	$	(8	)	$	(7	)	$	(5	)	$	(36	)	$	(16	)
Impact of changes in interest rates higher (lower) than expected (a)		(4	)		(2	)		12			27			(12	)		33			(50	)
Impact of change in stock market (b) (c)		(27	)		12			6			(2	)		9			(11	)		29
Renewal option purchases lower (higher) than expected		1			—			(3	)		(4	)		—			(6	)		4
Other, including impact of actual vs. expected lapses		(6	)		(2	)		(4	)		(1	)		(3	)		(13	)		—
Impact of Fair Value accounting, as reported	$	(47	)	$	(2	)	$	3		$	13		$	(11	)	$	(33	)	$	(33	)
Embedded Derivative liability balance at end of period	$	2,720		$	3,105		$	2,776		$	2,549		$	2,542		$	2,720		$	2,542
(a)   Assuming a parallel shift in rates, AFG’s general “Rule of Thumb” for Fair Value earnings impact each month is that a +/-10bps change in the average 5/15 year Corporate A2 rates, as compared to the expected change (as indicated by the forward curve at the end of each month) will equate to a +/-$7 million impact on Fair Value earnings.
(b)   Change in S&P 500		-14	%		+7	%		+3	%		-1	%		+6	%		-6	%		+19	%
(c)   Estimated impact (in millions of dollars) of a 1% change in the stock market on the fair value accounting for FIAs (i.e. 1% “Rule of Thumb”)	$	2		$	2		$	2		$	2		$	2		$	2		$	2

Page 14

American Financial Group, Inc. Detail of Annuity Benefits Expense (GAAP) ($ in millions)

	Three Months Ended															Twelve Months Ended
	12/31/18			9/30/18			6/30/18			3/31/18			12/31/17			12/31/18			12/31/17
Detail of annuity benefits expense:
Interest credited - fixed	$	186		$	179		$	173		$	166		$	164		$	704		$	633
Interest credited - fixed component of variable annuities		1			1			2			1			1			5			5
Change in expected death and annuitization reserve		4			5			4			4			5			17			18
Amortization of sales inducements		4			5			5			5			5			19			19
Guaranteed withdrawal benefit reserve:
Impact of change in stock market		22			(7	)		(2	)		1			(5	)		14			(14	)
Accretion of benefits and other		24			25			21			22			21			92			81
Change in other benefit reserves		8			10			11			8			9			37			45
Unlockings (a)		5			—			54			—			35			59			35
Subtotal before impact of fair value accounting		254			218			268			207			235			947			822
Embedded derivativemark-to-market (b)		(490	)		223			82			(63	)		178			(248	)		564
Equity optionmark-to-market		570			(219	)		(90	)		38			(156	)		299			(494	)
Subtotal impact in fair value accounting		80			4			(8	)		(25	)		22			51			70
Total annuity benefits expense	$	334		$	222		$	260		$	182		$	257		$	998		$	892

(a) Includes unlockings for fixed indexed annuity embedded derivative reserves, sales inducement asset and other reserves. Does not include unlocking income of $28 million in 2018 and $32 million in 2017 for deferred policy acquisition costs and unearned revenue reserves. These unlockings are included in acquisition expenses and other income. In total, AFG recorded an unlocking expense of $31 million in 2018 and $3 million in 2017.

(b) Excludes unlocking impact of $44 million in 2018 and $25 million in 2017.

Page 15

American Financial Group, Inc. Net Spread on Fixed Annuities (GAAP) ($ in millions)

	Three Months Ended															Twelve Months Ended
	12/31/18			9/30/18			6/30/18			3/31/18			12/31/17			12/31/18			12/31/17
Average fixed annuity investments (at amortized cost) (a)	$	35,993		$	34,955		$	33,935		$	33,002		$	32,245		$	34,471		$	31,250
Average annuity benefits accumulated		36,103			35,226			34,165			33,329			32,680			34,706			31,526
Annuity benefits accumulated in excess of investments (a)	$	(110	)	$	(271	)	$	(230	)	$	(327	)	$	(435	)	$	(235	)	$	(276	)
As % of average annuity benefits accumulated (except as noted)
Net investment income (as % of investments)		4.64	%		4.70	%		4.83	%		4.74	%		4.62	%		4.73	%		4.63	%
Interest credited		(2.06	%)		(2.03	%)		(2.02	%)		(1.99	%)		(2.00	%)		(2.03	%)		(2.01	%)
Net interest spread on fixed annuities		2.58	%		2.67	%		2.81	%		2.75	%		2.62	%		2.70	%		2.62	%
Policy charges and other miscellaneous income		0.08	%		0.09	%		0.10	%		0.10	%		0.10	%		0.10	%		0.11	%
Other annuity benefit expenses, net		(0.51	%)		(0.24	%)		(0.27	%)		(0.29	%)		(0.21	%)		(0.33	%)		(0.28	%)
Acquisition expenses		(0.59	%)		(0.76	%)		(0.89	%)		(0.94	%)		(0.60	%)		(0.79	%)		(0.62	%)
Other expenses		(0.38	%)		(0.36	%)		(0.35	%)		(0.38	%)		(0.37	%)		(0.37	%)		(0.37	%)
Change in fair value of derivatives		(0.89	%)		(0.05	%)		0.10	%		0.30	%		(0.27	%)		(0.15	%)		(0.22	%)
Unlockings		(0.04	%)		0.00	%		(0.32	%)		0.00	%		(0.06	%)		(0.09	%)		(0.01	%)
Net spread earned on fixed annuities		0.25	%		1.35	%		1.18	%		1.54	%		1.21	%		1.07	%		1.23	%
Average annuity benefits accumulated	$	36,103		$	35,226		$	34,165		$	33,329		$	32,680		$	34,706		$	31,526
Net spread earned on fixed annuities		0.25	%		1.35	%		1.18	%		1.54	%		1.21	%		1.07	%		1.23	%
Earnings on fixed annuity benefits accumulated	$	22		$	119		$	101		$	128		$	99		$	370		$	387
Annuity benefits accumulated in excess of investments	$	(110	)	$	(271	)	$	(230	)	$	(327	)	$	(435	)	$	(235	)	$	(276	)
Net investment income (as % of investments)		4.64	%		4.70	%		4.83	%		4.74	%		4.62	%		4.73	%		4.63	%
Earnings (loss) on annuity benefits accumulated in excess of investments	$	(1	)	$	(3	)	$	(3	)	$	(4	)	$	(5	)	$	(11	)	$	(13	)
Variable annuity earnings (includes unlockings)		(1	)		1			1			1			3			2			6
Earnings before income taxes	$	20		$	117		$	99		$	125		$	97		$	361		$	380
Detail of net spread earned on fixed annuities
Net spread earned - before impact of fair value accounting and unlockings		0.81	%		1.37	%		1.46	%		1.38	%		1.40	%		1.26	%		1.34	%
Change in fair value of derivatives		(0.89	%)		(0.05	%)		0.10	%		0.30	%		(0.27	%)		(0.15	%)		(0.22	%)
Estimated net offsets to deferred sales inducements and deferred policy acquisition costs		0.37	%		0.03	%		(0.06	%)		(0.14	%)		0.14	%		0.05	%		0.12	%
Unlockings		(0.04	%)		0.00	%		(0.32	%)		0.00	%		(0.06	%)		(0.09	%)		(0.01	%)
Net spread earned - after impact of fair value accounting and unlockings		0.25	%		1.35	%		1.18	%		1.54	%		1.21	%		1.07	%		1.23	%

(a) Excludesnon-investment assets such as deferred acquisition costs, FIA options, accrued investment income and company owned life insurance.

Page 16

American Financial Group, Inc. Statutory Annuity Premiums ($ in millions)

	Three Months Ended										Twelve Months Ended
	12/31/18		9/30/18		6/30/18		3/31/18		12/31/17		12/31/18		12/31/17
Retail single premium annuities - indexed	$	392	$	354	$	378	$	294	$	239	$	1,418	$	990
Retail single premium annuities - fixed		27		17		22		21		15		87		70
Broker dealer single premium annuities - indexed		335		322		355		259		174		1,271		733
Broker dealer single premium annuities - fixed		4		3		4		3		1		14		7
Financial institutions single premium annuities - indexed		455		460		448		413		364		1,776		1,711
Financial institutions single premium annuities - fixed		142		114		131		105		63		492		622
Pension risk transfer (PRT)		75		56		1		—		6		132		6
Education market - fixed and indexed annuities		46		46		54		46		41		192		174
Subtotal fixed annuity premiums		1,476		1,372		1,393		1,141		903		5,382		4,313
Variable annuities		6		6		6		7		6		25		28
Total annuity premiums	$	1,482	$	1,378	$	1,399	$	1,148	$	909	$	5,407	$	4,341
Summary by Distribution Channel:
Retail	$	419	$	371	$	400	$	315	$	254	$	1,505	$	1,060
Broker dealer		339		325		359		262		175		1,285		740
Financial institutions		597		574		579		518		427		2,268		2,333
Other		127		108		61		53		53		349		208
Total annuity premiums	$	1,482	$	1,378	$	1,399	$	1,148	$	909	$	5,407	$	4,341
Summary by Product Type:
Total indexed	$	1,211	$	1,164	$	1,213	$	992	$	802	$	4,580	$	3,523
Total fixed		265		208		180		149		101		802		790
Variable		6		6		6		7		6		25		28
Total annuity premiums	$	1,482	$	1,378	$	1,399	$	1,148	$	909	$	5,407	$	4,341

Page 17

American Financial Group, Inc. Fixed Annuity Benefits Accumulated (GAAP) ($ in millions)

	Three Months Ended															Twelve Months Ended
	12/31/18			9/30/18			6/30/18			3/31/18			12/31/17			12/31/18			12/31/17
Beginning fixed annuity reserves	$	35,774		$	34,678		$	33,652		$	33,005		$	32,354		$	33,005		$	29,647
Premiums		1,476			1,372			1,393			1,141			903			5,382			4,313
Federal Home Loan Bank (“FHLB”) advances (paydowns)		225			—			—			—			(64	)		225			(64	)
Surrenders, benefits and other withdrawals		(796	)		(707	)		(706	)		(627	)		(596	)		(2,836	)		(2,246	)
Interest and other annuity benefit expenses:
Interest credited		186			179			173			166			164			704			633
Embedded derivativemark-to-market		(490	)		223			82			(63	)		178			(248	)		564
Change in other benefit reserves		52			29			29			30			25			140			117
Unlockings		4			—			55			—			41			59			41
Ending fixed annuity reserves	$	36,431		$	35,774		$	34,678		$	33,652		$	33,005		$	36,431		$	33,005
Reconciliation to annuity benefits accumulated:
Ending fixed annuity reserves	$	36,431		$	35,774		$	34,678		$	33,652		$	33,005		$	36,431		$	33,005
Impact of unrealized investment gains on reserves		10			8			32			71			133			10			133
Fixed component of variable annuities		175			176			176			178	��		178			175			178
Annuity benefits accumulated per balance sheet	$	36,616		$	35,958		$	34,886		$	33,901		$	33,316		$	36,616		$	33,316
Annualized surrenders and other withdrawals as a % of beginning reserves		8.9	%		8.2	%		8.4	%		7.6	%		7.4	%		8.6	%		7.6	%
Rider reserves included in ending fixed annuity reserves above	$	472		$	428		$	411		$	381		$	358		$	472		$	358

Page 18

American Financial Group, Inc. Guaranteed Minimum Interest Rate (“GMIR”) Analysis ($ in millions)

GMIR	12/31/18			9/30/18			6/30/18			3/31/18			12/31/17			9/30/17
1 - 1.99%		79	%		78	%		78	%		77	%		76	%		75	%
2 - 2.99%		4	%		4	%		4	%		5	%		5	%		5	%
3 - 3.99%		8	%		9	%		9	%		9	%		10	%		10	%
4.00% and above		9	%		9	%		9	%		9	%		9	%		10	%
Annuity Benefits Accumulated	$	36,616		$	35,958		$	34,886		$	33,901		$	33,316		$	32,671
Traditional Fixed and FIA Surrender Value (a) (b)	$	27,842		$	27,434		$	26,502		$	25,582		$	25,138		$	24,428
Ability to Lower Average Crediting Rates by (a) (c)		1.19	%		1.16	%		1.09	%		1.00	%		0.92	%		0.88	%
Pretax earnings impact of crediting guaranteed minimums (a)	$	331		$	317		$	288		$	255		$	230		$	216
(assumes net DAC impact over time = $0)

(a) Excludes Annuities with Guaranteed Withdrawal Benefits, FHLB advances, immediate reserves and certain other reserves.

(b) FIA Surrender Value include Host + Embedded Derivatives + Fixed Account values.

(c) Weighted Average Crediting Rate less GMIR

Page 19

American Financial Group, Inc. Consolidated Balance Sheet ($ in millions)

	12/31/18			9/30/18			6/30/18			3/31/18			12/31/17			09/30/17
Assets:
Total cash and investments	$	48,498		$	47,841		$	46,779		$	45,949		$	46,048		$	45,253
Recoverables from reinsurers		3,349			3,352			3,073			3,173			3,369			3,262
Prepaid reinsurance premiums		610			717			645			614			600			691
Agents’ balances and premiums receivable		1,234			1,299			1,266			1,113			1,146			1,173
Deferred policy acquisition costs		1,682			1,669			1,582			1,417			1,216			1,119
Assets of managed investment entities		4,700			4,998			5,032			5,090			4,902			4,767
Other receivables		1,090			1,633			1,048			918			1,030			1,545
Variable annuity assets (separate accounts)		557			650			636			632			644			628
Other assets		1,529			1,832			1,574			1,551			1,504			1,526
Goodwill		207			199			199			199			199			199
Total assets	$	63,456		$	64,190		$	61,834		$	60,656		$	60,658		$	60,163
Liabilities and Equity:
Unpaid losses and loss adjustment expenses	$	9,741		$	9,670		$	9,093		$	9,193		$	9,678		$	9,563
Unearned premiums		2,595			2,740			2,539			2,413			2,410			2,567
Annuity benefits accumulated		36,616			35,958			34,886			33,901			33,316			32,671
Life, accident and health reserves		635			643			647			656			658			667
Payable to reinsurers		752			932			721			661			743			906
Liabilities of managed investment entities		4,512			4,807			4,840			4,869			4,687			4,506
Long-term debt		1,302			1,302			1,301			1,301			1,301			1,284
Variable annuity liabilities (separate accounts)		557			650			636			632			644			628
Other liabilities		1,774			2,324			2,087			1,847			1,887			1,992
					��
Total liabilities	$	58,484		$	59,026		$	56,750		$	55,473		$	55,324		$	54,784
Redeemable noncontrolling interests	$	—		$	—		$	—		$	—		$	3		$	—
Shareholders’ equity:
Common stock	$	89		$	89		$	89		$	89		$	88		$	88
Capital surplus		1,245			1,231			1,220			1,205			1,181			1,167
Retained earnings		3,588			3,800			3,628			3,584			3,248			3,435
Unrealized gains - equities		—			—			—			—			221			173
Unrealized gains - fixed maturities		83			93			191			342			619			533
Unrealized gains (losses) - fixed maturity-related cash flow hedges		(11	)		(32	)		(27	)		(24	)		(13	)		(6	)
Other comprehensive income, net of tax		(24	)		(17	)		(17	)		(13	)		(14	)		(11	)
Total shareholders’ equity		4,970			5,164			5,084			5,183			5,330			5,379
Noncontrolling interests		2			—			—			—			1			—
Total liabilities and equity	$	63,456		$	64,190		$	61,834		$	60,656		$	60,658		$	60,163

Page 20

American Financial Group, Inc. Book Value Per Share and Price / Book Summary (in millions, except per share information)

	12/31/18			9/30/18			6/30/18			3/31/18			12/31/17			09/30/17
Shareholders’ equity	$	4,970		$	5,164		$	5,084		$	5,183		$	5,330		$	5,379
Unrealized (gains) related to fixed maturities		(72	)		(61	)		(164	)		(318	)		(606	)		(527	)
Adjusted shareholders’ equity		4,898			5,103			4,920			4,865			4,724			4,852
Goodwill		(207	)		(199	)		(199	)		(199	)		(199	)		(199	)
Intangibles		(54	)		(31	)		(34	)		(36	)		(26	)		(29	)
Tangible adjusted shareholders’ equity	$	4,637		$	4,873		$	4,687		$	4,630		$	4,499		$	4,624
Common shares outstanding		89.292			89.189			89.072			88.881			88.275			88.093
Book value per share:
Book value per share	$	55.66		$	57.90		$	57.08		$	58.32		$	60.38		$	61.06
Adjusted (a)		54.86			57.22			55.24			54.74			53.51			55.08
Tangible, adjusted (b)		51.93			54.64			52.63			52.10			50.95			52.50
Market capitalization
AFG’s closing common share price	$	90.53		$	110.97		$	107.33		$	112.22		$	108.54		$	103.45
Market capitalization	$	8,084		$	9,897		$	9,560		$	9,974		$	9,581		$	9,113
Price / Adjusted book value ratio		1.65			1.94			1.94			2.05			2.03			1.88

(a) Excludes unrealized gains related to fixed maturity investments.

(b) Excludes unrealized gains related to fixed maturity investments, goodwill and intangibles.

Page 21

American Financial Group, Inc. Capitalization ($ in millions)

	12/31/18			9/30/18			6/30/18			3/31/18			12/31/17			09/30/17
AFG senior obligations	$	1,018		$	1,018		$	1,018		$	1,018		$	1,018		$	1,003
Borrowings drawn under credit facility		—			—			—			—			—			—
Debt excluding subordinated debt	$	1,018		$	1,018		$	1,018		$	1,018		$	1,018		$	1,003
AFG subordinated debentures		300			300			300			300			300			300
Total principal amount of long-term debt	$	1,318		$	1,318		$	1,318		$	1,318		$	1,318		$	1,303
Shareholders’ equity		4,970			5,164			5,084			5,183			5,330			5,379
Noncontrolling interests (including redeemable NCI)		2			—			—			—			4			—
Less:
Unrealized (gains) related to fixed maturity investments		(72	)		(61	)		(164	)		(318	)		(606	)		(527	)
Total adjusted capital	$	6,218		$	6,421		$	6,238		$	6,183		$	6,046		$	6,155
Ratio of debt to total adjusted capital:
Including subordinated debt		21.2	%		20.5	%		21.1	%		21.3	%		21.8	%		21.2	%
Excluding subordinated debt		16.4	%		15.9	%		16.3	%		16.5	%		16.8	%		16.3	%

Page 22

American Financial Group, Inc. Additional Supplemental Information ($ in millions)

	Three Months Ended										Twelve Months Ended
	12/31/18		9/30/18		6/30/18		3/31/18		12/31/17		12/31/18		12/31/17
Property and Casualty Insurance
Paid Losses (GAAP)	$	719	$	614	$	629	$	640	$	726	$	2,602	$	2,528

	12/31/18		9/30/18		6/30/18		3/31/18		12/31/17		09/30/17
Statutory Surplus
Property and Casualty Insurance	$	2,867	$	2,885	$	2,797	$	2,781	$	2,729	$	2,817
AFG’s principal annuity subsidiaries (total adjusted capital)	$	3,015	$	2,703	$	2,511	$	2,442	$	2,442	$	2,433
Allowable dividends without regulatory approval
Property and Casualty Insurance	$	529	$	563	$	563	$	563	$	563	$	496
Annuity andRun-off (a)		263		263		263		263		263		197
Total	$	792	$	826	$	826	$	826	$	826	$	693

(a) The amount in the 12/31/18 column represents the 9/30/18 amount. Theyear-end 2018 amount will be finalized in February 2019.

Page 23

American Financial Group, Inc. Total Cash and Investments ($ in millions)

	Carrying Value - December 31, 2018
	Property and Casualty Insurance		Annuity and Run-off		Parent and Other Non- Insurance		Consolidate CLOs			Total AFG Consolidated		% of Investment Portfolio
Total cash and investments:
Cash and cash equivalents	$	1,007	$	339	$	169	$	—		$	1,515		3	%
Fixed maturities - Available for sale		7,853		34,132		12		—			41,997		87	%
Fixed maturities - Trading		50		55		—		—			105		0	%
Equity securities		1,017		744		53		—			1,814		4	%
Investments accounted for using the equity method		557		817		—		—			1,374		3	%
Mortgage loans		289		779		—		—			1,068		2	%
Policy loans		—		174		—		—			174		0	%
Equity index call options		—		184		—		—			184		0	%
Real estate and other investments		134		276		44		(187	)		267		1	%
Total cash and investments	$	10,907	$	37,500	$	278	$	(187	)	$	48,498		100	%
	Carrying Value - December 31, 2017
	Property and Casualty Insurance		Annuity and Run-off		Parent and OtherNon- Insurance		Consolidate CLOs			Total AFG Consolidated		% of Investment Portfolio
Total cash and investments:
Cash and cash equivalents	$	1,398	$	625	$	315	$	—		$	2,338		5	%
Fixed maturities - Available for sale		7,142		31,223		14		—			38,379		83	%
Fixed maturities - Trading		232		116		—		—			348		1	%
Equity securities		1,012		594		56		—			1,662		4	%
Investments accounted for using the equity method		404		595		—		—			999		2	%
Mortgage loans		308		817		—		—			1,125		2	%
Policy loans		—		184		—		—			184		0	%
Equity index call options		—		701		—		—			701		2	%
Real estate and other investments		158		311		57		(214	)		312		1	%
Total cash and investments	$	10,654	$	35,166	$	442	$	(214	)	$	46,048		100	%
Unrealized gain/(loss) on equity securities	$	165	$	114	$	—	$	—		$	279

Note: On January 1, 2018, AFG adopted Accounting Standards Update (“ASU”)2016-01, which requires all equity securities other than those accounted for under the equity method to be reported at fair value with holding gains and losses recognized in net earnings.

Page 24

American Financial Group, Inc. Net Investment Income ($ in millions)

	Three Months Ended															Twelve Months Ended
	12/31/18			9/30/18			6/30/18			3/31/18			12/31/17			12/31/18			12/31/17
Property and Casualty Insurance:
Gross Investment Income
Fixed maturities - Available for sale	$	74		$	72		$	72		$	66		$	65		$	284		$	258
Fixed maturities - Trading		1			—			2			—			—			3			3
Equity securities - dividends		11			13			11			13			13			48			51
Equity securities - MTM		9			(1	)		5			—			—			13			—
Equity in investees		14			16			18			17			4			65			27
AFG managed CLOs		(1	)		1			1			1			2			2			7
Other investments (a)		10			9			8			5			6			32			26
Gross investment income		118			110			117			102			90			447			372
Investment expenses		(3	)		(2	)		(2	)		(2	)		(4	)		(9	)		(10	)
Total net investment income	$	115		$	108		$	115		$	100		$	86		$	438		$	362
Average cash and investments (b)	$	10,651		$	10,388		$	10,346		$	10,422		$	10,062		$	10,497		$	9,948
Average yield (c)		4.32	%		4.16	%		4.45	%		3.84	%		3.42	%		4.17	%		3.64	%
Fixed Annuity
Gross Investment Income
Fixed maturities - Available for sale	$	376		$	361		$	350		$	338		$	342		$	1,425		$	1,314
Equity securities - dividends		9			6			7			8			7			30			22
Equity securities - MTM		2			—			11			—			—			13			—
Equity in investees		19			25			23			29			9			96			37
AFG managed CLOs		(3	)		3			3			2			5			5			16
Other investments (a)		18			19			19			17			14			73			70
Gross investment income		421			414			413			394			377			1,642			1,459
Investment expenses		(4	)		(3	)		(3	)		(3	)		(4	)		(13	)		(11	)
Total net investment income	$	417		$	411		$	410		$	391		$	373		$	1,629		$	1,448
Average cash and investments (b)	$	35,993		$	34,955		$	33,935		$	33,002		$	32,245		$	34,471		$	31,250
Average yield (c)		4.64	%		4.70	%		4.83	%		4.74	%		4.62	%		4.73	%		4.63	%
AFG consolidated net investment income:
Property & Casualty	$	115		$	108		$	115		$	100		$	86		$	438		$	362
Annuity:
Fixed Annuity		417			411			410			391			373			1,629			1,448
Variable Annuity		2			2			2			3			3			9			10
Parent & other		4			10			7			4			10			25			34
Consolidate CLOs		4			(4	)		(4	)		(3	)		(7	)		(7	)		(23	)
Total net investment income	$	542		$	527		$	530		$	495		$	465		$	2,094		$	1,831

(a) Includes income from mortgage loans, real estate, policy loans, short-term investments, and cash equivalents.

(b) Average cash and investments is the average of the beginning and ending quarter balances, or the average of the five quarters balances.

(c) Average yield is calculated by dividing investment income for the quarter by the average cash and investment balance over the quarter.

Page 25

American Financial Group, Inc. InvestmentsMarked-to-Market Through Investment Income and Investments Accounted For Using the Equity Method ($ in millions)

	Three Months Ended															Twelve Months Ended
	12/31/18			9/30/18			6/30/18			3/31/18			12/31/17			12/31/18			12/31/17
Property and Casualty Insurance:
Net Investment Income
Equity securities MTM through investment income (a)	$	9		$	(1	)	$	5		$	—		$	—		$	13		$	—
Investments accounted for using the equity method (b)		14			16			18			17			4			65			27
AFG managed CLOs (eliminated in consolidation)		(1	)		1			1			1			2			2			7
Total Property & Casualty	$	22		$	16		$	24		$	18		$	6		$	80		$	34
Investments
Equity securities MTM through investment income (a)	$	50		$	40		$	40		$	31		$	27		$	50		$	27
Investments accounted for using the equity method (b)		557			520			475			440			402			557			402
AFG managed CLOs (eliminated in consolidation)		56			57			57			66			64			56			64
Total Property & Casualty	$	663		$	617		$	572		$	537		$	493		$	663		$	493
Annualized Yield - Property & Casualty		13.8	%		10.8	%		17.3	%		14.0	%		4.1	%		13.9	%		7.9	%
Fixed Annuity:
Net Investment Income
Equity securities MTM through investment income (a)	$	2		$	—		$	11		$	—		$	—		$	13		$	—
Investments accounted for using the equity method (b)		19			25			23			29			9			96			37
AFG managed CLOs (eliminated in consolidation)		(3	)		3			3			2			5			5			16
Total Fixed Annuity	$	18		$	28		$	37		$	31		$	14		$	114		$	53
Investments
Equity securities MTM through investment income (a)	$	84		$	79		$	79		$	57		$	49		$	84		$	49
Investments accounted for using the equity method (b)		817			769			719			657			590			817			590
AFG managed CLOs (eliminated in consolidation)		132			134			135			155			151			132			151
Total Fixed Annuity	$	1,033		$	982		$	933		$	869		$	790		$	1,033		$	790
Annualized Yield - Fixed Annuity		7.1	%		11.7	%		16.4	%		14.9	%		7.6	%		12.4	%		8.2	%
Combined (includes Parent amounts not shown above):
Net Investment Income
Equity securities MTM through investment income (a)	$	6		$	1		$	16		$	(1	)	$	2		$	22		$	7
Investments accounted for using the equity method (b)		33			41			41			46			13			161			64
AFG managed CLOs (eliminated in consolidation)		(4	)		4			4			3			7			7			23
Total Combined (including Parent)	$	35		$	46		$	61		$	48		$	22		$	190		$	94
Investments
Equity securities MTM through investment income (a)	$	187		$	176		$	173		$	142		$	132		$	187		$	132
Investments accounted for using the equity method (b)		1,374			1,289			1,194			1,097			992			1,374			992
AFG managed CLOs (eliminated in consolidation)		188			191			192			221			215			188			215
Total Combined (including Parent)	$	1,749		$	1,656		$	1,559		$	1,460		$	1,339		$	1,749		$	1,339
Annualized Yield - Combined		8.2	%		11.4	%		16.2	%		13.7	%		5.7	%		12.2	%		8.3	%

(a) AFG carries the small portion of its equity securities previously classified as “trading” and investments in limited partnerships and similar investments that aren’t accounted for using the equity method at fair value through net investment income.

(b) The majority of AFG’s investments accounted for using the equity method mark their underlying assets to market through net income.

Page 26

American Financial Group, Inc. Fixed Maturities - By Security Type - AFG Consolidated ($ in millions )

December 31, 2018	Amortized Cost			Fair Value		Unrealized Gain (Loss)			% of Fair Value			% of Investment Portfolio
US Government and government agencies	$	245		$	243	$	(2	)		1	%		1	%
States, municipalities and political subdivisions		6,850			6,964		114			17	%		14	%
Foreign government		166			168		2			0	%		0	%
Residential mortgage-backed securities		2,478			2,746		268			7	%		6	%
Commercial mortgage-backed securities		905			920		15			2	%		2	%
Asset-backed securities		9,781			9,811		30			23	%		20	%
Corporate and other bonds		21,517			21,250		(267	)		50	%		44	%
Total AFG consolidated	$	41,942		$	42,102	$	160			100	%		87	%
Annualized yield on available for sale fixed maturities:
Excluding investment expense (a)		4.47	%
Net of investment expense (a)		4.42	%
Approximate average life and duration:
Approximate average life		6 years
Approximate duration		4.5 years
December 31, 2017	Amortized Cost			Fair Value		Unrealized Gain (Loss)			% of Fair Value			% of Investment Portfolio
US Government and government agencies	$	293		$	291	$	(2	)		1	%		1	%
States, municipalities and political subdivisions		6,912			7,148		236			18	%		15	%
Foreign government		239			242		3			1	%		1	%
Residential mortgage-backed securities		2,887			3,230		343			8	%		7	%
Commercial mortgage-backed securities		928			963		35			2	%		2	%
Asset-backed securities		7,836			7,962		126			21	%		17	%
Corporate and other bonds		18,291			18,891		600			49	%		41	%
Total AFG consolidated	$	37,386		$	38,727	$	1,341			100	%		84	%
Annualized yield on available for sale fixed maturities:
Excluding investment expense (a)		4.51	%
Net of investment expense (a)		4.43	%
Approximate average life and duration:
Approximate average life		6.5 years
Approximate duration		5 years

(a) Annualized yield is calculated by dividing investment income for the quarter by the average cost over the quarter. Average cost is the average of the beginning and ending quarter asset balances.

Page 27

American Financial Group, Inc. Fixed Maturities - By Security Type Portfolio ($ in millions)

	December 31, 2018												December 31, 2017
	Amortized Cost			Fair Value			Unrealized Gain (Loss)			% of Fair Value			Amortized Cost			Fair Value		Unrealized Gain (Loss)			% of Fair Value
Property and Casualty Insurance:
US Government and government agencies	$	203		$	202			(1	)		3	%	$	244		$	243	$	(1	)		3	%
States, municipalities and political subdivisions		2,630			2,642			12			33	%		2,740			2,798		58			38	%
Foreign government		155			156			1			2	%		228			229		1			3	%
Residential mortgage-backed securities		725			784			59			10	%		843			918		75			13	%
Commercial mortgage-backed securities		83			84			1			1	%		93			95		2			1	%
Asset-backed securities		2,275			2,259			(16	)		29	%		1,716			1,724		8			23	%
Corporate and other bonds		1,792			1,776			(16	)		22	%		1,349			1,367		18			19	%
Property and Casualty Insurance	$	7,863		$	7,903		$	40			100	%	$	7,213		$	7,374	$	161			100	%
Annualized yield on available for sale fixed maturities:
Excluding investment expense (a)		3.91	%											3.73	%
Net of investment expense (a)		3.81	%											3.54	%
Tax equivalent, net of investment expense (b)		3.99	%											4.03	%
Approximate average life and duration:						��
Approximate average life		4.5 years												5 years
Approximate duration		3.5 years												4 years

	December 31, 2018											December 31, 2017
	Amortized Cost			Fair Value		Unrealized Gain (Loss)			% of Fair Value			Amortized Cost			Fair Value		Unrealized Gain (Loss)			% of Fair Value
Annuity andRun-off:
US Government and government agencies	$	42		$	41	$	(1	)		0	%	$	48		$	47	$	(1	)		0	%
States, municipalities and political subdivisions		4,220			4,322		102			13	%		4,172			4,350		178			14	%
Foreign government		11			12		1			0	%		11			13		2			0	%
Residential mortgage-backed securities		1,750			1,950		200			6	%		2,041			2,299		258			7	%
Commercial mortgage-backed securities		822			836		14			2	%		835			868		33			3	%
Asset-backed securities		7,506			7,552		46			22	%		6,120			6,238		118			20	%
Corporate and other bonds		19,725			19,474		(251	)		57	%		16,942			17,524		582			56	%
Total Annuity andRun-off	$	34,076		$	34,187	$	111			100	%	$	30,169		$	31,339	$	1,170			100	%
Annualized yield on available for sale fixed maturities:
Excluding investment expense (a)		4.59	%										4.66	%
Net of investment expense (a)		4.55	%										4.61	%
Approximate average life and duration:
Approximate average life		6.5 years											6.5 years
Approximate duration		4.5 years											5 years

(a) Annualized yield is calculated by dividing investment income for the quarter by the average cost over the quarter. Average cost is the average of the beginning and ending quarter asset balances.

(b) Adjusts the yield ontax-exempt bonds to the fully taxable equivalent yield.

Page 28

American Financial Group, Inc. Fixed Maturities - Credit Rating ($ in millions)

	December 31, 2018
By Credit Rating (a)	Amortized Cost		Fair Value		Unrealized Gain (Loss)			% of Fair Value
Investment grade
AAA	$	7,367	$	7,359	$	(8	)		17	%
AA		8,714		8,831		117			21	%
A		10,006		9,989		(17	)		24	%
BBB		12,206		12,053		(153	)		29	%
Subtotal - Investment grade		38,293		38,232		(61	)		91	%
BB		703		685		(18	)		2	%
B		261		254		(7	)		0	%
Other (b)		2,685		2,931		246			7	%
Subtotal -Non-Investment grade		3,649		3,870		221			9	%
Total	$	41,942	$	42,102	$	160			100	%

98% of the fixed maturity portfolio is NAIC designated 1 or 2.

	December 31, 2017
By Credit Rating (a)	Amortized Cost		Fair Value		Unrealized Gain (Loss)		% of Fair Value
Investment grade
AAA	$	6,253	$	6,356	$	103		16	%
AA		8,150		8,411		261		22	%
A		9,149		9,447		298		25	%
BBB		10,146		10,496		350		27	%
Subtotal - Investment grade		33,698		34,710		1,012		90	%
BB		725		739		14		2	%
B		324		328		4		1	%
Other (b)		2,639		2,950		311		7	%
Subtotal -Non-Investment grade		3,688		4,017		329		10	%
Total	$	37,386	$	38,727	$	1,341		100	%

98% of the fixed maturity portfolio is NAIC designated 1 or 2.

(a) If two agencies rate a security, the rating displayed above is the lower of the two; if three or more agencies rate a security, the rating displayed is the second lowest.

(b) See page 32 for more information.

Page 29

American Financial Group, Inc. Mortgage-Backed Securities - AFG Consolidated ($ in millions)

December 31, 2018	Amortized Cost		Fair Value		Unrealized Gain (Loss)			% of Fair Value			% of Investment Portfolio
Residential
Agency	$	170	$	168	$	(2	)		5	%		1	%
Prime(Non-Agency)		967		1,098		131			30	%		2	%
Alt-A		972		1,074		102			29	%		2	%
Subprime		369		406		37			11	%		1	%
Commercial		905		920		15			25	%		2	%
Total AFG consolidated	$	3,383	$	3,666	$	283			100	%		8	%

• Substantially all of AFG’s MBS securities are either senior tranches of securitizations or collateralized by senior tranches of securitizations.

• The average amortized cost as a percent of par is - Prime 81%;Alt-A 80%; Subprime 83%; CMBS 99%.

• The average FICO score of our residential MBS securities is - Prime 734;Alt-A 698; Subprime 631.

• 94% of our Commercial MBS portfolio is investment-grade rated (82% AAA) and the average subordination for this group of assets is 33.5%.

• The approximate average life by collateral type is - Residential 4.5 years; Commercial 4.5 years.

December 31, 2017	Amortized Cost		Fair Value		Unrealized Gain (Loss)			% of Fair Value			% of Investment Portfolio
Residential
Agency	$	207	$	205	$	(2	)		5	%		0	%
Prime(Non-Agency)		1,218		1,386		168			33	%		3	%
Alt-A		994		1,122		128			27	%		3	%
Subprime		468		517		49			12	%		1	%
Commercial		928		963		35			23	%		2	%
Total AFG consolidated	$	3,815	$	4,193	$	378			100	%		9	%

Page 30

American Financial Group, Inc. Mortgage-Backed Securities Portfolio ($ in millions)

Property and Casualty Insurance:

	December 31, 2018
	Amortized				Unrealized			% of			% of Inv
By Asset Type	Cost		Fair Value		Gain (Loss)			Fair Value			Portfolio
Residential
Agency	$	137	$	134	$	(3	)		15	%		1	%
Prime(Non-Agency)		138		155		17			18	%		1	%
Alt-A		289		319		30			37	%		3	%
Subprime		161		176		15			20	%		2	%
Commercial		83		84		1			10	%		1	%
Total	$	808	$	868	$	60			100	%		8	%
	December 31, 2017
	Amortized				Unrealized			% of			% of Inv
By Asset Type	Cost		Fair Value		Gain (Loss)			Fair Value			Portfolio
Residential
Agency	$	166	$	163	$	(3	)		16	%		2	%
Prime(Non-Agency)		174		195		21			19	%		2	%
Alt-A		301		339		38			34	%		3	%
Subprime		202		221		19			22	%		2	%
Commercial		93		95		2			9	%		1	%
Total	$	936	$	1,013	$	77			100	%		10	%
Annuity andRun-off:
	December 31, 2018
	Amortized				Unrealized			% of			% of Inv
By Asset Type	Cost		Fair Value		Gain (Loss)			Fair Value			Portfolio
Residential
Agency	$	33	$	34	$	1			1	%		0	%
Prime(Non-Agency)		826		931		105			34	%		2	%
Alt-A		683		755		72			27	%		2	%
Subprime		208		230		22			8	%		1	%
Commercial		822		836		14			30	%		2	%
Total	$	2,572	$	2,786	$	214			100	%		7	%
	December 31, 2017
	Amortized				Unrealized			% of			% of Inv
By Asset Type	Cost		Fair Value		Gain (Loss)			Fair Value			Portfolio
Residential
Agency	$	41	$	42	$	1			1	%		0	%
Prime(Non-Agency)		1,041		1,178		137			37	%		4	%
Alt-A		693		783		90			25	%		2	%
Subprime		266		296		30			10	%		1	%
Commercial		835		868		33			27	%		2	%
Total	$	2,876	$	3,167	$	291			100	%		9	%

Page 31

American Financial Group, Inc. Mortgage-Backed Securities - Credit Rating ($ in millions)

	December 31, 2018
	Amortized				Unrealized			% of
By Credit Rating (a)	Cost		Fair Value		Gain (Loss)			Fair Value
Investment grade
AAA	$	1,107	$	1,119	$	12			31	%
AA		143		147		4			4	%
A		263		270		7			7	%
BBB		232		243		11			7	%
Subtotal - investment grade		1,745		1,779		34			49	%
BB		128		131		3			3	%
B		155		154		(1	)		4	%
Other (b)		1,355		1,602		247			44	%
Total	$	3,383	$	3,666	$	283			100	%

96% of the mortgage-backed security portfolio has an NAIC 1 designation.

	December 31, 2017
	Amortized				Unrealized		% of
By Credit Rating (a)	Cost		Fair Value		Gain (Loss)		Fair Value
Investment grade
AAA	$	1,209	$	1,246	$	37		30	%
AA		90		93		3		2	%
A		225		239		14		6	%
BBB		170		182		12		4	%
Subtotal - investment grade		1,694		1,760		66		42	%
BB		192		197		5		5	%
B		224		230		6		5	%
Other (b)		1,705		2,006		301		48	%
Total	$	3,815	$	4,193	$	378		100	%

97% of the mortgage-backed security portfolio has an NAIC 1 designation.

(a) If two agencies rate a security, the rating displayed above is the lower of the two; if three or more agencies rate a security, the rating displayed is the second lowest.

(b) See page 33 for more information.

Page 32

Appendix A American Financial Group, Inc. Fixed Maturities - Credit Rating by Type ($ in millions)

	Fair Value - December 31, 2018
By Credit Rating (a)	US Gov		Munis		Frgn Gov		RMBS		CMBS		ABS		Corp/Oth		Total		% Total
Investment grade
AAA	$	213	$	1,889	$	98	$	367	$	752	$	3,870	$	170	$	7,359		17	%
AA		22		4,456		53		129		18		2,570		1,583		8,831		21	%
A		—		448		—		248		22		2,086		7,185		9,989		24	%
BBB		—		110		—		169		74		769		10,931		12,053		29	%
Subtotal - Investment grade		235		6,903		151		913		866		9,295		19,869		38,232		91	%
BB		—		—		—		97		34		23		531		685		2	%
B		—		8		—		151		3		4		88		254		0	%
CCC, CC, C		—		—		—		670		5		2		12		689		2	%
D		—		3		—		230		—		—		1		234		1	%
Subtotal -Non-Investment grade		—		11		—		1,148		42		29		632		1,862		5	%
Not Rated		8		50		17		685		12		487		749		2,008		4	%
Total	$	243	$	6,964	$	168	$	2,746	$	920	$	9,811	$	21,250	$	42,102		100	%
	Fair Value - December 31, 2017
By Credit Rating (a)	US Gov		Munis		Frgn Gov		RMBS		CMBS		ABS		Corp/Oth		Total		% Total
Investment grade
AAA	$	250	$	1,848	$	168	$	444	$	802	$	2,649	$	195	$	6,356		16	%
AA		34		4,671		66		74		19		2,242		1,305		8,411		22	%
A		—		494		3		216		23		1,835		6,876		9,447		25	%
BBB		—		47		—		106		76		800		9,467		10,496		27	%
Subtotal - Investment grade		284		7,060		237		840		920		7,526		17,843		34,710		90	%
BB		—		4		4		173		24		23		511		739		2	%
B		—		7		1		226		4		—		90		328		1	%
CCC, CC, C		—		1		—		902		3		3		26		935		2	%
D		—		5		—		517		—		—		—		522		1	%
Subtotal -Non-Investment grade		—		17		5		1,818		31		26		627		2,524		6	%
Not Rated		7		71		—		572		12		410		421		1,493		4	%
Total	$	291	$	7,148	$	242	$	3,230	$	963	$	7,962	$	18,891	$	38,727		100	%

(a) If two agencies rate a security, the rating displayed above is the lower of the two; if three or more agencies rate a security, the rating displayed is the second lowest.

Page 33