Securities Registered Pursuant to Section 12(b) of the Act: | |||||||||||||||||
Title of Each Class | Trading Symbol(s) | Name of Each Exchange on Which Registered | |||||||||||||||
Common Stock | AFG | New York Stock Exchange | |||||||||||||||
5.875% Subordinated Debentures due March 30, 2059 | AFGB | New York Stock Exchange | |||||||||||||||
5.625% Subordinated Debentures due June 1, 2060 | AFGD | New York Stock Exchange | |||||||||||||||
5.125% Subordinated Debentures due December 15, 2059 | AFGC | New York Stock Exchange | |||||||||||||||
4.50% Subordinated Debentures due September 15, 2060 | AFGE | New York Stock Exchange |
Page | |||||||||||
FORWARD-LOOKING STATEMENTS | |||||||||||
Part I | |||||||||||
Item 1 | — | Business | |||||||||
Item 1A | — | Risk Factors | |||||||||
Item 1B | — | Unresolved Staff Comments | none | ||||||||
Item 2 | — | Properties | |||||||||
Item 3 | — | Legal Proceedings | |||||||||
Item 4 | — | Mine Safety Disclosures | none | ||||||||
Part II | |||||||||||
Item 5 | — | Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities | |||||||||
Item 6 | — | Selected Financial Data | none | ||||||||
Item 7 | — | Management’s Discussion and Analysis of Financial Condition and Results of Operations | |||||||||
Item 7A | — | Quantitative and Qualitative Disclosure About Market Risk | |||||||||
Item 8 | — | Financial Statements and Supplementary Data | |||||||||
Item 9 | — | Changes in and Disagreements With Accountants on Accounting and Financial Disclosure | none | ||||||||
Item 9A | — | Controls and Procedures | |||||||||
Item 9B | — | Other Information | none | ||||||||
Part III | |||||||||||
Item 10 | — | Directors, Executive Officers and Corporate Governance | |||||||||
Item 11 | — | Executive Compensation | |||||||||
Item 12 | — | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters | |||||||||
Item 13 | — | Certain Relationships and Related Transactions, and Director Independence | |||||||||
Item 14 | — | Principal Accounting Fees and Services | |||||||||
Part IV | |||||||||||
Item 15 | — | Exhibits, Financial Statement Schedules | |||||||||
Ratings | Gross Written | ||||||
AM Best | S&P | Premiums | |||||
Insurance Group | |||||||
Great American Insurance | A+ | A+ | $ | 4,857 | |||
National Interstate | A+ | not rated | 816 | ||||
Summit (Bridgefield Casualty and Bridgefield Employers) | A | A+ | 602 | ||||
Republic Indemnity | A | A+ | 202 | ||||
Neon Lloyd’s Syndicate | A | A+ | 567 | ||||
Mid-Continent Casualty | A+ | A+ | 142 | ||||
Other | 113 | ||||||
$ | 7,299 |
Ratings | Gross Written | ||||||||||||||||
AM Best | S&P | Premiums | |||||||||||||||
Insurance Group | |||||||||||||||||
Great American Insurance | A+ | A+ | $ | 6,043 | |||||||||||||
National Interstate | A+ | not rated | 905 | ||||||||||||||
Summit (Bridgefield Casualty and Bridgefield Employers) | A+ | A+ | 534 | ||||||||||||||
Republic Indemnity | A+ | A+ | 172 | ||||||||||||||
Mid-Continent Casualty | A+ | A+ | 161 | ||||||||||||||
Other | 131 | ||||||||||||||||
$ | 7,946 |
2021 | 2020 | 2019 | |||||||||||||||
Gross written premiums | $ | 7,946 | $ | 7,087 | $ | 7,299 | |||||||||||
Ceded reinsurance | (2,373) | (2,074) | (1,957) | ||||||||||||||
Net written premiums | $ | 5,573 | $ | 5,013 | $ | 5,342 | |||||||||||
Net earned premiums | $ | 5,404 | $ | 5,099 | $ | 5,185 | |||||||||||
Loss and LAE | 3,157 | 3,271 | 3,271 | ||||||||||||||
Underwriting expenses | 1,514 | 1,604 | 1,702 | ||||||||||||||
Underwriting gain (a) | $ | 733 | $ | 224 | $ | 212 | |||||||||||
GAAP ratios: | |||||||||||||||||
Loss and LAE ratio | 58.5 | % | 64.1 | % | 63.0 | % | |||||||||||
Underwriting expense ratio | 28.0 | % | 31.4 | % | 32.8 | % | |||||||||||
Combined ratio | 86.5 | % | 95.5 | % | 95.8 | % | |||||||||||
Statutory ratios: | |||||||||||||||||
Loss and LAE ratio | 55.9 | % | 60.7 | % | 61.3 | % | |||||||||||
Underwriting expense ratio | 29.6 | % | 31.2 | % | 31.6 | % | |||||||||||
Combined ratio | 85.5 | % | 91.9 | % | 92.9 | % | |||||||||||
Industry statutory combined ratio (b) | |||||||||||||||||
All lines | 101.8 | % | 98.8 | % | 99.2 | % | |||||||||||
Commercial lines | 99.8 | % | 99.9 | % | 99.3 | % |
2019 | 2018 | 2017 | ||||||||||
Gross written premiums | $ | 7,299 | $ | 6,840 | $ | 6,502 | ||||||
Ceded reinsurance | (1,957 | ) | (1,817 | ) | (1,751 | ) | ||||||
Net written premiums | $ | 5,342 | $ | 5,023 | $ | 4,751 | ||||||
Net earned premiums | $ | 5,185 | $ | 4,865 | $ | 4,579 | ||||||
Loss and LAE | 3,207 | 2,985 | 2,884 | |||||||||
Special asbestos and environmental (“A&E”) charges | 18 | 18 | 89 | |||||||||
Neon exited lines charge | 76 | — | (18 | ) | ||||||||
Underwriting expenses | 1,672 | 1,560 | 1,382 | |||||||||
Underwriting gain | $ | 212 | $ | 302 | $ | 242 | ||||||
GAAP ratios: | ||||||||||||
Loss and LAE ratio | 63.0 | % | 61.7 | % | 64.5 | % | ||||||
Underwriting expense ratio | 32.8 | % | 32.1 | % | 30.2 | % | ||||||
Combined ratio | 95.8 | % | 93.8 | % | 94.7 | % | ||||||
Statutory ratios: | ||||||||||||
Loss and LAE ratio | 61.3 | % | 60.2 | % | 63.0 | % | ||||||
Underwriting expense ratio | 31.6 | % | 31.6 | % | 30.1 | % | ||||||
Combined ratio | 92.9 | % | 91.8 | % | 93.1 | % | ||||||
Industry statutory combined ratio (a) | ||||||||||||
All lines | 96.8 | % | 101.5 | % | 104.0 | % | ||||||
Commercial lines | 97.6 | % | 102.0 | % | 102.1 | % |
Property and Transportation | |||||
Agricultural-related | Federally reinsured multi-peril crop (allied lines) insurance covering most perils as well as crop-hail, equine mortality and other coverages for full-time operating farms/ranches and agribusiness operations on a nationwide basis. | ||||
Commercial Automobile | Coverage for vehicles (such as buses and trucks) in a broad range of businesses including the moving and storage and transportation industries, | ||||
Property, Inland Marine and Ocean Marine | Coverage primarily for commercial properties, builders’ risk, contractors’ equipment, property, motor truck cargo, marine cargo, boat dealers, marina operators/dealers and excursion vessels. | ||||
Specialty Casualty | |||||
Excess and Surplus | Liability, umbrella and excess coverage for unique, volatile or hard to place risks, using rates and forms that generally do not have to be approved by state insurance regulators. | ||||
Executive and Professional Liability | Coverage for directors and officers of businesses and non-profit organizations, errors and omissions, cyber, and mergers and acquisitions. | ||||
General Liability | Coverage for contractor-related businesses, energy development and production risks, and environmental liability risks. | ||||
Targeted Programs | Coverage (primarily liability and property) for social service agencies, leisure, entertainment and non-profit organizations, customized solutions for other targeted markets and alternative risk programs using agency captives. | ||||
Umbrella and Excess Liability | Coverage in excess of primary layers. | ||||
Workers’ Compensation | Coverage for prescribed benefits payable to employees who are injured on the job. | ||||
Specialty Financial | |||||
Fidelity and Surety | Fidelity and crime coverage for government, mercantile and financial institutions and surety coverage for various types of contractors and public and private corporations. | ||||
Lease and Loan Services | Coverage for insurance risk management programs for lending and leasing institutions, including equipment leasing and collateral and lender-placed mortgage property insurance. |
2021 | 2020 | 2019 | |||||||||||||||
Property and transportation | $ | 2,157 | $ | 1,887 | $ | 1,876 | |||||||||||
Specialty casualty | 2,540 | 2,304 | 2,701 | ||||||||||||||
Specialty financial | 658 | 604 | 617 | ||||||||||||||
Other specialty (*) | 218 | 197 | 148 | ||||||||||||||
$ | 5,573 | $ | 4,992 | $ | 5,342 |
2019 | 2018 | 2017 | |||||||||
Property and transportation | $ | 1,876 | $ | 1,754 | $ | 1,765 | |||||
Specialty casualty | 2,701 | 2,509 | 2,280 | ||||||||
Specialty financial | 617 | 602 | 596 | ||||||||
Other specialty (*) | 148 | 158 | 110 | ||||||||
$ | 5,342 | $ | 5,023 | $ | 4,751 |
2021 | 2020 | 2019 | 2021 | 2020 | 2019 | |||||||||||||||||||||||||||||||||
California | 13.0 | % | 13.3 | % | 13.4 | % | Missouri | 2.5 | % | 2.4 | % | 2.6 | % | |||||||||||||||||||||||||
Florida | 8.7 | % | 9.7 | % | 10.1 | % | Pennsylvania | 2.5 | % | 2.6 | % | 2.6 | % | |||||||||||||||||||||||||
New York | 6.8 | % | 6.8 | % | 6.7 | % | Iowa | 2.4 | % | 1.9 | % | 2.2 | % | |||||||||||||||||||||||||
Texas | 6.6 | % | 6.9 | % | 6.9 | % | New Jersey | 2.4 | % | 2.3 | % | 2.5 | % | |||||||||||||||||||||||||
Illinois | 6.2 | % | 5.5 | % | 5.5 | % | Michigan | 2.3 | % | 2.3 | % | 1.9 | % | |||||||||||||||||||||||||
Georgia | 3.3 | % | 3.5 | % | 3.3 | % | Ohio | 2.2 | % | 2.2 | % | 1.9 | % | |||||||||||||||||||||||||
Indiana | 2.6 | % | 2.1 | % | 2.0 | % | Other | 35.9 | % | 36.3 | % | 36.2 | % | |||||||||||||||||||||||||
Kansas | 2.6 | % | 2.2 | % | 2.2 | % | 100.0 | % | 100.0 | % | 100.0 | % |
2019 | 2018 | 2017 | 2019 | 2018 | 2017 | |||||||||||||||
California | 13.4 | % | 13.5 | % | 13.2 | % | Pennsylvania | 2.6 | % | 2.5 | % | 2.4 | % | |||||||
Florida | 10.1 | % | 10.0 | % | 10.0 | % | New Jersey | 2.5 | % | 2.6 | % | 2.6 | % | |||||||
Texas | 6.9 | % | 6.8 | % | 6.2 | % | Iowa | 2.2 | % | 2.3 | % | 2.4 | % | |||||||
New York | 6.7 | % | 6.8 | % | 6.6 | % | Kansas | 2.2 | % | 2.3 | % | 2.2 | % | |||||||
Illinois | 5.5 | % | 5.3 | % | 5.6 | % | North Carolina | 2.0 | % | 2.1 | % | 2.1 | % | |||||||
Georgia | 3.3 | % | 3.3 | % | 3.2 | % | Indiana | 2.0 | % | 1.9 | % | 1.9 | % | |||||||
Missouri | 2.6 | % | 2.5 | % | 2.8 | % | Other | 38.0 | % | 38.1 | % | 38.8 | % | |||||||
100.0 | % | 100.0 | % | 100.0 | % |
Reinsurance Coverage | AFG | ||||||||||||||||||
Primary | Coverage | AFG Participation (a) | Maximum | ||||||||||||||||
Retention | Amount | % | $ | Loss (b) | |||||||||||||||
U.S.-based operations: | |||||||||||||||||||
California Workers’ Compensation | $ | 2 | $ | 148 | 1 | % | $ | 1 | $ | 3 | |||||||||
Summit Workers’ Compensation | 3 | 37 | — | % | — | 3 | |||||||||||||
Other Workers’ Compensation | 2 | 48 | — | % | — | 2 | |||||||||||||
Commercial Umbrella | 2 | 48 | 10 | % | 5 | 7 | |||||||||||||
Property — General | 5 | 45 | — | % | — | 5 | |||||||||||||
Property — Catastrophe (c) | 15 | 119 | — | % | — | 15 | |||||||||||||
Neon Lloyd’s Syndicate | |||||||||||||||||||
Property — Catastrophe (direct) (c) | 15 | 130 | — | % | — | 15 | |||||||||||||
Property — Catastrophe (assumed) (c) | 15 | 30 | — | % | — | 15 |
Reinsurance Coverage | AFG | ||||||||||||||||||||||||||||
Primary | Coverage | AFG Participation (a) | Maximum | ||||||||||||||||||||||||||
Retention | Amount | % | $ | Loss (b) | |||||||||||||||||||||||||
U.S.-based operations: | |||||||||||||||||||||||||||||
California Workers’ Compensation | $ | 2 | $ | 148 | 1 | % | $ | 1 | $ | 3 | |||||||||||||||||||
Summit Workers’ Compensation | 5 | 35 | — | % | — | 5 | |||||||||||||||||||||||
Other Workers’ Compensation | 2 | 48 | 3 | % | 1 | 3 | |||||||||||||||||||||||
Commercial Umbrella | 2 | 48 | 10 | % | 5 | 7 | |||||||||||||||||||||||
Property — General | 10 | 40 | — | % | — | 10 | |||||||||||||||||||||||
Property — Catastrophe (c) | 20 | 105 | 18 | % | 19 | 39 |
2019 | 2018 | 2017 | ||||||||||
Reinsurance ceded | $ | 1,957 | $ | 1,817 | $ | 1,751 | ||||||
Reinsurance ceded, excluding crop | 1,371 | 1,202 | 1,076 | |||||||||
Reinsurance assumed — including involuntary pools and associations | 255 | 214 | 192 |
2021 | 2020 | 2019 | |||||||||||||||
Reinsurance ceded | $ | 2,373 | $ | 2,074 | $ | 1,957 | |||||||||||
Reinsurance ceded, excluding crop | 1,665 | 1,483 | 1,371 | ||||||||||||||
Reinsurance assumed — including involuntary pools and associations | 246 | 225 | 255 |
Liability reported on a SAP basis, net of $154 million of retroactive reinsurance | $ | 7,311 | |||
Reinsurance recoverables, net of allowance | 3,419 | ||||
Other, including reserves of foreign insurers | 344 | ||||
Liability reported on a GAAP basis | $ | 11,074 |
Liability reported on a SAP basis, net of $131 million of retroactive reinsurance | $ | 6,539 | |
Reinsurance recoverables, net of allowance | 3,024 | ||
Other, including reserves of foreign insurers | 669 | ||
Liability reported on a GAAP basis | $ | 10,232 |
2019 | 2018 | 2017 | 2021 | 2020 | 2019 | ||||||||||||||||||||||||
Reserves at beginning of year | $ | 395 | $ | 403 | $ | 337 | Reserves at beginning of year | $ | 422 | $ | 383 | $ | 395 | ||||||||||||||||
Incurred losses and LAE | 18 | 18 | 89 | Incurred losses and LAE | — | 47 | 18 | ||||||||||||||||||||||
Paid losses and LAE | (30 | ) | (26 | ) | (23 | ) | Paid losses and LAE | (14) | (8) | (30) | |||||||||||||||||||
Reserves at end of year, net of reinsurance recoverable | 383 | 395 | 403 | Reserves at end of year, net of reinsurance recoverable | 408 | 422 | 383 | ||||||||||||||||||||||
Reinsurance recoverable, net of allowance | 146 | 129 | 125 | Reinsurance recoverable, net of allowance | 147 | 150 | 146 | ||||||||||||||||||||||
Gross reserves at end of year | $ | 529 | $ | 524 | $ | 528 | Gross reserves at end of year | $ | 555 | $ | 572 | $ | 529 |
Annuity | |||||||||||
Annuity | Policies | Ratings | |||||||||
Company | Premiums | In Force | AM Best | S&P | |||||||
Great American Life Insurance Company | $ | 4,799 | 436,000 | A | A+ | ||||||
Annuity Investors Life Insurance Company | 161 | 107,000 | A | A+ |
Statutory Premiums | ||||||||||||
2019 | 2018 | 2017 | ||||||||||
Financial institutions single premium annuities — indexed | $ | 1,537 | $ | 1,776 | $ | 1,711 | ||||||
Financial institutions single premium annuities — fixed | 1,229 | 492 | 622 | |||||||||
Retail single premium annuities — indexed | 943 | 1,418 | 990 | |||||||||
Retail single premium annuities — fixed | 120 | 87 | 70 | |||||||||
Broker dealer single premium annuities — indexed | 657 | 1,271 | 733 | |||||||||
Broker dealer single premium annuities — fixed | 32 | 14 | 7 | |||||||||
Pension risk transfer | 257 | 132 | 6 | |||||||||
Education market — fixed and indexed annuities | 164 | 192 | 174 | |||||||||
Total fixed annuity premiums | 4,939 | 5,382 | 4,313 | |||||||||
Variable annuities | 21 | 25 | 28 | |||||||||
Total annuity premiums | $ | 4,960 | $ | 5,407 | $ | 4,341 |
Year ended December 31, | ||||||||||||
2019 | 2018 | 2017 | ||||||||||
Annuity earnings before income taxes — before the impact of unlocking, derivatives related to FIAs and other impacts of stock market performance and interest rates on FIAs | $ | 409 | $ | 409 | $ | 388 | ||||||
Unlocking | (1 | ) | (31 | ) | (3 | ) | ||||||
Impact of derivatives related to FIAs and other impacts of changes in the stock market and interest rates on FIAs over or under option costs (a): | ||||||||||||
Change in fair value of derivatives related to FIAs | (294 | ) | (51 | ) | (70 | ) | ||||||
Accretion of guaranteed minimum FIA benefits | (408 | ) | (347 | ) | (289 | ) | ||||||
Other annuity benefits | (14 | ) | (83 | ) | (58 | ) | ||||||
Less cost of equity options | 586 | 506 | 395 | |||||||||
Related impact on the amortization of deferred policy acquisition costs (b) | 84 | (42 | ) | 17 | ||||||||
Annuity segment earnings before income taxes | $ | 362 | $ | 361 | $ | 380 | ||||||
Net spread earned on fixed annuities — before impact of unlocking, changes in the fair value of derivatives related to FIAs and other impacts of changes in the stock market and interest rates on FIAs | 1.08 | % | 1.20 | % | 1.25 | % | ||||||
Changes in fair value of derivatives related to FIAs and other impacts of the stock market and interest rates under (over) option costs | (0.12 | %) | (0.04 | %) | (0.01 | %) | ||||||
Unlocking | — | % | (0.09 | %) | (0.01 | %) | ||||||
Net spread earned on fixed annuities | 0.96 | % | 1.07 | % | 1.23 | % |
2019 | 2018 | 2017 | |||||||
Wells Fargo & Company | 12.0 | % | 7.4 | % | 8.1 | % | |||
The PNC Financial Services Group, Inc. | 8.8 | % | 6.6 | % | 9.1 | % | |||
Regions Financial Corporation | 6.7 | % | 4.8 | % | 6.5 | % | |||
BB&T Corporation | 5.1 | % | 3.7 | % | 5.5 | % | |||
LPL Financial | 4.4 | % | 4.8 | % | 5.5 | % |
2019 | 2018 | 2017 | |||||||
California | 9.9 | % | 10.2 | % | 10.0 | % | |||
Florida | 8.3 | % | 8.1 | % | 7.3 | % | |||
North Carolina | 6.0 | % | 4.5 | % | 4.8 | % | |||
Ohio | 5.9 | % | 5.2 | % | 5.4 | % | |||
Pennsylvania | 5.2 | % | 5.5 | % | 6.1 | % |
2019 | 2018 | 2017 | 2021 | 2020 | 2019 | |||||||||||||||||||||
Total return on AFG’s fixed maturities | 8.7 | % | 1.3 | % | 5.9 | % | Total return on AFG’s fixed maturities | 1.9 | % | 4.0 | % | 6.1 | % | |||||||||||||
Barclays Capital U.S. Universal Bond Index | 9.3 | % | (0.3 | %) | 4.1 | % | Barclays Capital U.S. Universal Bond Index | (1.1 | %) | 7.6 | % | 9.3 | % | |||||||||||||
Total return on AFG’s common stocks and equivalents | 26.0 | % | (12.0 | %) | 15.8 | % | ||||||||||||||||||||
Standard & Poor’s 500 Index | 31.5 | % | (4.4 | %) | 21.8 | % |
Amortized | Fair Value | Amortized | Fair Value | |||||||||||||||||||||||||
Cost | Amount | % | Cost, net (*) | Amount | % | |||||||||||||||||||||||
S&P or comparable rating | S&P or comparable rating | |||||||||||||||||||||||||||
AAA, AA, A | $ | 27,832 | $ | 28,856 | 62 | % | AAA, AA, A | $ | 7,640 | $ | 7,736 | 75 | % | |||||||||||||||
BBB | 12,746 | 13,452 | 29 | % | BBB | 1,339 | 1,370 | 13 | % | |||||||||||||||||||
Total investment grade | 40,578 | 42,308 | 91 | % | Total investment grade | 8,979 | 9,106 | 88 | % | |||||||||||||||||||
BB | 711 | 721 | 2 | % | BB | 162 | 162 | 2 | % | |||||||||||||||||||
B | 185 | 182 | — | % | B | 37 | 37 | — | % | |||||||||||||||||||
CCC, CC, C | 508 | 591 | 1 | % | CCC, CC, C | 125 | 145 | 1 | % | |||||||||||||||||||
D | 159 | 186 | — | % | D | 15 | 19 | — | % | |||||||||||||||||||
Total non-investment grade | 1,563 | 1,680 | 3 | % | Total non-investment grade | 339 | 363 | 3 | % | |||||||||||||||||||
Not rated | 2,383 | 2,517 | 6 | % | Not rated | 866 | 888 | 9 | % | |||||||||||||||||||
Total | $ | 44,524 | $ | 46,505 | 100 | % | Total | $ | 10,184 | $ | 10,357 | 100 | % |
Total Number of Shares Purchased | Average Price Paid Per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | Maximum Number of Shares that May Yet be Purchased Under the Plans or Programs (b) | ||||||||||||||||||||
First quarter | 1,757,702 | $ | 108.98 | 1,757,702 | 3,710,904 | ||||||||||||||||||
Second quarter | 916,520 | 124.40 | 916,520 | 7,794,384 | |||||||||||||||||||
Third quarter | 94,960 | 128.56 | 94,960 | 7,699,424 | |||||||||||||||||||
Fourth quarter: | |||||||||||||||||||||||
October | 8,502 | $ | 126.14 | 8,502 | 7,690,922 | ||||||||||||||||||
November | — | — | — | 7,690,922 | |||||||||||||||||||
December | — | — | — | 7,690,922 | |||||||||||||||||||
Total | 2,777,684 | $ | 114.79 | (a) | 2,777,684 |
As of December 31, | |||||||||||||||||||||||||||||||||||
2016 | 2017 | 2018 | 2019 | 2020 | 2021 | ||||||||||||||||||||||||||||||
AFG | $ | 100 | $ | 129 | $ | 112 | $ | 143 | $ | 120 | $ | 233 | |||||||||||||||||||||||
S&P 500 Index | 100 | 122 | 116 | 153 | 181 | 233 | |||||||||||||||||||||||||||||
S&P 500 P&C Index (b) | 100 | 122 | 117 | 147 | 156 | 183 |
As of December 31, | ||||||||||||||||||||||||
2014 | 2015 | 2016 | 2017 | 2018 | 2019 | |||||||||||||||||||
AFG | $ | 100 | $ | 122 | $ | 154 | $ | 199 | $ | 173 | $ | 220 | ||||||||||||
S&P 500 Index | 100 | 101 | 113 | 138 | 132 | 174 | ||||||||||||||||||
S&P 500 P&C Index (b) | 100 | 110 | 127 | 155 | 148 | 186 | ||||||||||||||||||
S&P 500 Life & Health Index (c) | 100 | 94 | 117 | 136 | 108 | 133 |
2019 | 2018 | 2017 | 2016 | 2015 | ||||||||||||||||
Earnings Statement Data: | ||||||||||||||||||||
Revenues: | ||||||||||||||||||||
Property and casualty insurance | $ | 5,668 | $ | 5,313 | $ | 4,969 | $ | 4,729 | $ | 4,621 | ||||||||||
Annuity | 1,900 | 1,745 | 1,561 | 1,459 | 1,322 | |||||||||||||||
Other | 382 | 358 | 330 | 289 | 382 | |||||||||||||||
Realized gains (losses) on securities and subsidiaries | 287 | (266 | ) | 5 | 21 | (180 | ) | |||||||||||||
Total revenues | $ | 8,237 | $ | 7,150 | $ | 6,865 | $ | 6,498 | $ | 6,145 | ||||||||||
Earnings before income taxes: | ||||||||||||||||||||
Property and casualty insurance | $ | 649 | $ | 709 | $ | 591 | $ | 577 | $ | 576 | ||||||||||
Annuity | 362 | 361 | 380 | 368 | 331 | |||||||||||||||
Other | (190 | ) | (165 | ) | (252 | ) | (179 | ) | (162 | ) | ||||||||||
Realized gains (losses) on securities and subsidiaries | 287 | (266 | ) | 5 | 21 | (180 | ) | |||||||||||||
Earnings before income taxes | $ | 1,108 | $ | 639 | $ | 724 | $ | 787 | $ | 565 | ||||||||||
Net earnings, including noncontrolling interests | $ | 869 | $ | 517 | $ | 477 | $ | 668 | $ | 370 | ||||||||||
Less: Net earnings (loss) attributable to noncontrolling interests | (28 | ) | (13 | ) | 2 | 19 | 18 | |||||||||||||
Net earnings attributable to shareholders | $ | 897 | $ | 530 | $ | 475 | $ | 649 | $ | 352 | ||||||||||
Earnings attributable to shareholders per Common Share: | ||||||||||||||||||||
Basic — GAAP | $ | 9.98 | $ | 5.95 | $ | 5.40 | $ | 7.47 | $ | 4.02 | ||||||||||
Diluted — GAAP | 9.85 | 5.85 | 5.28 | 7.33 | 3.94 | |||||||||||||||
Core net operating earnings per share (diluted) (a) | 8.62 | 8.40 | 6.55 | 6.03 | 5.44 | |||||||||||||||
Cash dividends paid per share of Common Stock (b) | $ | 4.95 | $ | 4.45 | $ | 4.7875 | $ | 2.1525 | $ | 2.03 | ||||||||||
Ratio of earnings to fixed charges including annuity benefits (c) | 1.85 | 1.54 | 1.72 | 1.85 | 1.66 | |||||||||||||||
Balance Sheet Data: | ||||||||||||||||||||
Cash and investments | $ | 55,252 | $ | 48,498 | $ | 46,048 | $ | 41,433 | $ | 37,736 | ||||||||||
Total assets | 70,130 | 63,456 | 60,658 | 55,072 | 49,837 | |||||||||||||||
Property and casualty insurance reserves: | ||||||||||||||||||||
Unpaid losses and loss adjustment expenses | 10,232 | 9,741 | 9,678 | 8,563 | 8,127 | |||||||||||||||
Unearned premiums | 2,830 | 2,595 | 2,410 | 2,171 | 2,060 | |||||||||||||||
Annuity benefits accumulated | 40,406 | 36,616 | 33,316 | 29,907 | 26,622 | |||||||||||||||
Life, accident and health reserves | 612 | 635 | 658 | 691 | 705 | |||||||||||||||
Long-term debt | 1,473 | 1,302 | 1,301 | 1,283 | 998 | |||||||||||||||
Shareholders’ equity | $ | 6,269 | $ | 4,970 | $ | 5,330 | $ | 4,916 | $ | 4,592 | ||||||||||
Less: Net unrealized gains related to fixed maturities (d) | 879 | 72 | 606 | 299 | 279 | |||||||||||||||
Adjusted shareholders’ equity (e) | $ | 5,390 | $ | 4,898 | $ | 4,724 | $ | 4,617 | $ | 4,313 | ||||||||||
Book value per share | $ | 69.43 | $ | 55.66 | $ | 60.38 | $ | 56.55 | $ | 52.50 | ||||||||||
Adjusted book value per share (e) | 59.70 | 54.86 | 53.51 | 53.11 | 49.32 |
2019 | 2018 | 2017 | 2016 | 2015 | ||||||||||
Ratio of core earnings to fixed charges excluding annuity benefits | 12.78 | 11.31 | 8.97 | 9.15 | 8.59 | |||||||||
Impact of non-core items | 1.83 | (3.45 | ) | (1.30 | ) | (0.53 | ) | (2.01 | ) | |||||
Ratio of earnings to fixed charges excluding annuity benefits | 14.61 | 7.86 | 7.67 | 8.62 | 6.58 | |||||||||
Impact of including interest on annuities as a fixed charge | (12.76 | ) | (6.32 | ) | (5.95 | ) | (6.77 | ) | (4.92 | ) | ||||
Ratio of earnings to fixed charges including annuity benefits | 1.85 | 1.54 | 1.72 | 1.85 | 1.66 |
INDEX TO MD&A | ||||||||||||||
Page | Page | |||||||||||||
INDEX TO MD&A | ||||
Page | Page | |||
December 31, | December 31, | ||||||||||||||||||||||||
2019 | 2018 | 2021 | 2020 | ||||||||||||||||||||||
Principal amount of long-term debt | $ | 1,493 | $ | 1,318 | Principal amount of long-term debt | $ | 1,993 | $ | 1,993 | ||||||||||||||||
Total capital | 6,883 | 6,218 | Total capital | 6,869 | 7,486 | ||||||||||||||||||||
Ratio of debt to total capital: | Ratio of debt to total capital: | ||||||||||||||||||||||||
Including subordinated debt | 21.7 | % | 21.2 | % | Including subordinated debt | 29.0 | % | 26.6 | % | ||||||||||||||||
Excluding subordinated debt | 14.8 | % | 16.4 | % | Excluding subordinated debt | 19.2 | % | 17.6 | % |
Year ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Net cash provided by operating activities | $ | 1,714 | $ | 2,183 | $ | 2,456 | |||||||||||
Net cash used in investing activities | (436) | (1,564) | (3,065) | ||||||||||||||
Net cash provided by (used in) financing activities | (1,957) | (123) | 1,408 | ||||||||||||||
Net change in cash and cash equivalents | $ | (679) | $ | 496 | $ | 799 |
Year ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Net cash provided by operating activities | $ | 2,456 | $ | 2,083 | $ | 1,804 | |||||
Net cash used in investing activities | (3,065 | ) | (5,350 | ) | (3,292 | ) | |||||
Net cash provided by financing activities | 1,408 | 2,444 | 1,719 | ||||||||
Net change in cash and cash equivalents | $ | 799 | $ | (823 | ) | $ | 231 |
% of Reserves | ||||||||||
at December 31, | ||||||||||
GMIR | 2019 | 2018 | 2017 | |||||||
1 — 1.99% | 81% | 79% | 76% | |||||||
2 — 2.99% | 3% | 4% | 5% | |||||||
3 — 3.99% | 7% | 8% | 10% | |||||||
4.00% and above | 9% | 9% | 9% | |||||||
Annuity benefits accumulated (in millions) | $40,406 | $36,616 | $33,316 |
Year ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Net cash provided by operating activities | $ | 833 | $ | 483 | $ | 306 | |||||||||||
Net cash provided by (used in) investing activities | 2,167 | (294) | (56) | ||||||||||||||
Net cash used in financing activities | (2,626) | (140) | (242) | ||||||||||||||
Net change in cash and cash equivalents | $ | 374 | $ | 49 | $ | 8 |
Year ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Net cash provided by operating activities | $ | 306 | $ | 215 | $ | 578 | |||||
Net cash provided by (used in) investing activities | (56 | ) | 10 | (63 | ) | ||||||
Net cash used in financing activities | (242 | ) | (366 | ) | (413 | ) | |||||
Net change in cash and cash equivalents | $ | 8 | $ | (141 | ) | $ | 102 |
Total | Within One Year | 2-3 Years | 4-5 Years | More than 5 Years | ||||||||||||||||
Annuities (a) | $ | 45,451 | $ | 3,546 | $ | 8,819 | $ | 11,035 | $ | 22,051 | ||||||||||
Life, accident and health liabilities (a) | 1,283 | 101 | 207 | 163 | 812 | |||||||||||||||
Property and casualty unpaid losses and loss adjustment expenses (b) | 10,232 | 2,834 | 2,753 | 1,156 | 3,489 | |||||||||||||||
Long-term debt, including interest | 3,349 | 68 | 136 | 136 | 3,009 | |||||||||||||||
Operating leases (c) | 202 | 47 | 73 | 47 | 35 | |||||||||||||||
Total | $ | 60,517 | $ | 6,596 | $ | 11,988 | $ | 12,537 | $ | 29,396 |
Fair value of fixed maturity portfolio | $ | 46,618 | |
Percentage impact on fair value of 100 bps increase in interest rates | (4.0 | %) | |
Pretax impact on fair value of fixed maturity portfolio | $ | (1,865 | ) |
Offsetting adjustments to deferred policy acquisition costs and other balance sheet amounts | 850 | ||
Estimated pretax impact on accumulated other comprehensive income | (1,015 | ) | |
Deferred income tax | 213 | ||
Estimated after-tax impact on accumulated other comprehensive income | $ | (802 | ) |
Fair value of fixed maturity portfolio | $ | 10,385 | |||
Percentage impact on fair value of 100 bps increase in interest rates | (2.0 | %) | |||
Pretax impact on fair value of fixed maturity portfolio | $ | (208) |
Amortized Cost | Fair Value | Fair Value as % of Cost | Unrealized Gain (Loss) | % Rated Investment Grade | ||||||||||||||
Collateral type | ||||||||||||||||||
Residential: | ||||||||||||||||||
Agency-backed | $ | 549 | $ | 552 | 101 | % | $ | 3 | 100 | % | ||||||||
Non-agency prime | 1,157 | 1,264 | 109 | % | 107 | 53 | % | |||||||||||
Alt-A | 897 | 1,015 | 113 | % | 118 | 37 | % | |||||||||||
Subprime | 298 | 330 | 111 | % | 32 | 25 | % | |||||||||||
Commercial | 896 | 927 | 103 | % | 31 | 96 | % | |||||||||||
$ | 3,797 | $ | 4,088 | 108 | % | $ | 291 | 63 | % |
Securities With Unrealized Gains | Securities With Unrealized Losses | ||||||||||
Available for Sale Fixed Maturities | |||||||||||
Fair value of securities | $ | 6,086 | $ | 3,496 | |||||||
Amortized cost of securities | $ | 5,885 | $ | 3,524 | |||||||
Gross unrealized gain (loss) | $ | 201 | $ | (28) | |||||||
Fair value as % of amortized cost | 103 | % | 99 | % | |||||||
Number of security positions | 1,545 | 514 | |||||||||
Number individually exceeding $2 million gain or loss | 3 | — | |||||||||
Concentration of gains (losses) by type or industry (exceeding 5% of unrealized): | |||||||||||
States and municipalities | $ | 74 | $ | — | |||||||
Mortgage-backed securities | 50 | (3) | |||||||||
Other asset-backed securities | 17 | (11) | |||||||||
Asset managers | 7 | (2) | |||||||||
Technology | 4 | (2) | |||||||||
Collateralized loan obligations | 3 | (2) | |||||||||
U.S. Government and government agencies | 2 | (2) | |||||||||
Foreign government | — | (2) | |||||||||
Percentage rated investment grade | 90 | % | 95 | % |
Securities With Unrealized Gains | Securities With Unrealized Losses | ||||||
Available for Sale Fixed Maturities | |||||||
Fair value of securities | $ | 38,726 | $ | 6,685 | |||
Amortized cost of securities | $ | 36,657 | $ | 6,773 | |||
Gross unrealized gain (loss) | $ | 2,069 | $ | (88 | ) | ||
Fair value as % of amortized cost | 106 | % | 99 | % | |||
Number of security positions | 4,680 | 649 | |||||
Number individually exceeding $2 million gain or loss | 165 | 7 | |||||
Concentration of gains (losses) by type or industry (exceeding 5% of unrealized): | |||||||
States and municipalities | $ | 363 | $ | (4 | ) | ||
Mortgage-backed securities | 296 | (5 | ) | ||||
Banks, savings and credit institutions | 287 | (2 | ) | ||||
Other asset-backed securities | 156 | (20 | ) | ||||
Insurance | 138 | (1 | ) | ||||
Collateralized loans obligations | 10 | (37 | ) | ||||
Percentage rated investment grade | 92 | % | 93 | % |
Securities With Unrealized Gains | Securities With Unrealized Losses | ||||||||||
Maturity | |||||||||||
One year or less | 13 | % | 2 | % | |||||||
After one year through five years | 31 | % | 17 | % | |||||||
After five years through ten years | 12 | % | 3 | % | |||||||
After ten years | 5 | % | 1 | % | |||||||
61 | % | 23 | % | ||||||||
Collateralized loan obligations and other asset-backed securities (average life of approximately 3 years) | 31 | % | 64 | % | |||||||
Mortgage-backed securities (average life of approximately 3.5 years) | 8 | % | 13 | % | |||||||
100 | % | 100 | % |
Securities With Unrealized Gains | Securities With Unrealized Losses | |||||
Maturity | ||||||
One year or less | 4 | % | 2 | % | ||
After one year through five years | 27 | % | 7 | % | ||
After five years through ten years | 36 | % | 9 | % | ||
After ten years | 8 | % | 8 | % | ||
75 | % | 26 | % | |||
Collateralized loan obligations and other asset-backed securities (average life of approximately 4 years) | 16 | % | 65 | % | ||
Mortgage-backed securities (average life of approximately 4-1/2 years) | 9 | % | 9 | % | ||
100 | % | 100 | % |
Aggregate Fair Value | Aggregate Unrealized Gain (Loss) | Fair Value as % of Cost | |||||||||||||||
Fixed Maturities at December 31, 2021 | |||||||||||||||||
Securities with unrealized gains: | |||||||||||||||||
Exceeding $500,000 (84 securities) | $ | 946 | $ | 75 | 109 | % | |||||||||||
$500,000 or less (1,461 securities) | 5,140 | 126 | 103 | % | |||||||||||||
$ | 6,086 | $ | 201 | 103 | % | ||||||||||||
Securities with unrealized losses: | |||||||||||||||||
Exceeding $500,000 (8 securities) | $ | 188 | $ | (5) | 97 | % | |||||||||||
$500,000 or less (506 securities) | 3,308 | (23) | 99 | % | |||||||||||||
$ | 3,496 | $ | (28) | 99 | % |
Aggregate Fair Value | Aggregate Unrealized Gain (Loss) | Fair Value as % of Cost | |||||||||
Fixed Maturities at December 31, 2019 | |||||||||||
Securities with unrealized gains: | |||||||||||
Exceeding $500,000 (1,278 securities) | $ | 20,444 | $ | 1,557 | 108 | % | |||||
$500,000 or less (3,402 securities) | 18,282 | 512 | 103 | % | |||||||
$ | 38,726 | $ | 2,069 | 106 | % | ||||||
Securities with unrealized losses: | |||||||||||
Exceeding $500,000 (34 securities) | $ | 793 | $ | (41 | ) | 95 | % | ||||
$500,000 or less (615 securities) | 5,892 | (47 | ) | 99 | % | ||||||
$ | 6,685 | $ | (88 | ) | 99 | % |
Aggregate Fair Value | Aggregate Unrealized Loss | Fair Value as % of Cost | |||||||||
Securities with Unrealized Losses at December 31, 2019 | |||||||||||
Investment grade fixed maturities with losses for: | |||||||||||
Less than one year (295 securities) | $ | 4,086 | $ | (32 | ) | 99 | % | ||||
One year or longer (222 securities) | 2,116 | (33 | ) | 98 | % | ||||||
$ | 6,202 | $ | (65 | ) | 99 | % | |||||
Non-investment grade fixed maturities with losses for: | |||||||||||
Less than one year (98 securities) | $ | 375 | $ | (12 | ) | 97 | % | ||||
One year or longer (34 securities) | 108 | (11 | ) | 91 | % | ||||||
$ | 483 | $ | (23 | ) | 95 | % |
Aggregate Fair Value | Aggregate Unrealized Loss | Fair Value as % of Cost | |||||||||||||||
Securities with Unrealized Losses at December 31, 2021 | |||||||||||||||||
Investment grade fixed maturities with losses for: | |||||||||||||||||
Less than one year (336 securities) | $ | 3,133 | $ | (21) | 99 | % | |||||||||||
One year or longer (53 securities) | 196 | (3) | 98 | % | |||||||||||||
$ | 3,329 | $ | (24) | 99 | % | ||||||||||||
Non-investment grade fixed maturities with losses for: | |||||||||||||||||
Less than one year (80 securities) | $ | 137 | $ | (2) | 99 | % | |||||||||||
One year or longer (45 securities) | 30 | (2) | 94 | % | |||||||||||||
$ | 167 | $ | (4) | 98 | % |
Gross Loss Reserves | |||||||||||||||||||||||||||||
Case | IBNR | LAE | Total Reserves | Gross Written Premiums | |||||||||||||||||||||||||
Statutory Line of Business | |||||||||||||||||||||||||||||
Other liability — occurrence | $ | 770 | $ | 2,645 | $ | 635 | $ | 4,050 | $ | 1,143 | |||||||||||||||||||
Workers’ compensation | 948 | 1,277 | 351 | 2,576 | 1,528 | ||||||||||||||||||||||||
Other liability — claims made | 226 | 515 | 326 | 1,067 | 554 | ||||||||||||||||||||||||
Commercial auto/truck liability/medical | 375 | 396 | 139 | 910 | 842 | ||||||||||||||||||||||||
Special property (fire, allied lines, inland marine, earthquake) | 255 | 239 | 28 | 522 | 1,756 | ||||||||||||||||||||||||
Products liability — occurrence | 89 | 238 | 149 | 476 | 198 | ||||||||||||||||||||||||
Commercial multi-peril | 151 | 126 | 84 | 361 | 356 | ||||||||||||||||||||||||
Other lines | 215 | 443 | 103 | 761 | 1,294 | ||||||||||||||||||||||||
Total Statutory | 3,029 | 5,879 | 1,815 | 10,723 | 7,671 | ||||||||||||||||||||||||
Adjustments for GAAP: | |||||||||||||||||||||||||||||
Foreign operations | 141 | 175 | 34 | 350 | 268 | ||||||||||||||||||||||||
Deferred gains on retroactive reinsurance | — | 18 | — | 18 | — | ||||||||||||||||||||||||
Loss reserve discounting | (5) | — | — | (5) | — | ||||||||||||||||||||||||
Other | (12) | — | — | (12) | 7 | ||||||||||||||||||||||||
Total Adjustments for GAAP | 124 | 193 | 34 | 351 | 275 | ||||||||||||||||||||||||
Total GAAP Reserves and Premiums | $ | 3,153 | $ | 6,072 | $ | 1,849 | $ | 11,074 | $ | 7,946 |
Gross Loss Reserves | ||||||||||||||||||||
Case | IBNR | LAE | Total Reserves | Gross Written Premiums | ||||||||||||||||
Statutory Line of Business | ||||||||||||||||||||
Other liability — occurrence | $ | 817 | $ | 1,973 | $ | 477 | $ | 3,267 | $ | 1,098 | ||||||||||
Workers’ compensation | 995 | 1,360 | 350 | 2,705 | 1,270 | |||||||||||||||
Other liability — claims made | 204 | 354 | 260 | 818 | 588 | |||||||||||||||
Commercial auto/truck liability/medical | 261 | 343 | 118 | 722 | 449 | |||||||||||||||
Special property (fire, allied lines, inland marine, earthquake) | 366 | 98 | 25 | 489 | 1,439 | |||||||||||||||
Products liability — occurrence | 87 | 170 | 145 | 402 | 138 | |||||||||||||||
Commercial multi-peril | 136 | 113 | 66 | 315 | 300 | |||||||||||||||
Other lines | 200 | 409 | 93 | 702 | 1,190 | |||||||||||||||
Total Statutory | 3,066 | 4,820 | 1,534 | 9,420 | 6,472 | |||||||||||||||
Adjustments for GAAP: | ||||||||||||||||||||
Foreign operations | 293 | 475 | 36 | 804 | 811 | |||||||||||||||
Deferred gains on retroactive reinsurance | — | 27 | — | 27 | — | |||||||||||||||
Loss reserve discounting | (8 | ) | — | — | (8 | ) | — | |||||||||||||
Other | (11 | ) | — | — | (11 | ) | 16 | |||||||||||||
Total Adjustments for GAAP | 274 | 502 | 36 | 812 | 827 | |||||||||||||||
Total GAAP Reserves and Premiums | $ | 3,340 | $ | 5,322 | $ | 1,570 | $ | 10,232 | $ | 7,299 |
Line of business | Effect of 1% Change in Cost Trends | ||||
Other liability — occurrence | $ | 55 | |||
Workers’ compensation | 66 | ||||
Other liability — claims made | 20 | ||||
Commercial auto/truck liability/medical | 13 |
Line of business | Effect of 1% Change in Cost Trends | ||
Other liability — occurrence | $ | 45 | |
Workers’ compensation | 72 | ||
Other liability — claims made | 15 | ||
Commercial auto/truck liability/medical | 10 |
5-yr. Average Development (a)(b) | Net Reserves (b) December 31, 2019 | Effect on Net Earnings (b) | 5-yr. Average Development (a)(b) | Net Reserves (b) December 31, 2021 | Effect on Net Earnings (a)(b) | |||||||||||||||||||||||
Other liability — occurrence | 4.5 | % | $ | 1,428 | $ | (64 | ) | Other liability — occurrence | 4.5 | % | $ | 1,808 | $ | 82 | ||||||||||||||
Workers’ compensation | (3.7 | %) | 2,283 | 84 | Workers’ compensation | (5.1 | %) | 2,171 | (110) | |||||||||||||||||||
Other liability — claims made | (2.1 | %) | 605 | 13 | Other liability — claims made | (1.6 | %) | 795 | (12) | |||||||||||||||||||
Commercial auto/truck liability/medical | 0.3 | % | 508 | (2 | ) | Commercial auto/truck liability/medical | (1.6 | %) | 619 | (10) |
2021 | 2020 | 2019 | |||||||||||||||
Before reinsurance (gross) | 87.4 | % | 97.1 | % | 95.6 | % | |||||||||||
Effect of reinsurance | (0.9 | %) | (1.6 | %) | 0.2 | % | |||||||||||
Actual (net of reinsurance) | 86.5 | % | 95.5 | % | 95.8 | % |
2019 | 2018 | 2017 | |||||||
Before reinsurance (gross) | 95.6 | % | 94.1 | % | 98.9 | % | |||
Effect of reinsurance | 0.2 | % | (0.3 | %) | (4.2 | %) | |||
Actual (net of reinsurance) | 95.8 | % | 93.8 | % | 94.7 | % |
December 31, | |||||||||||
2021 | 2020 | ||||||||||
Asbestos | $ | 232 | $ | 239 | |||||||
Environmental | 176 | 183 | |||||||||
A&E reserves, net of reinsurance recoverable | 408 | 422 | |||||||||
Reinsurance recoverable, net of allowance | 147 | 150 | |||||||||
Gross A&E reserves | $ | 555 | $ | 572 |
December 31, | ||||||||
2019 | 2018 | |||||||
Asbestos | $ | 221 | $ | 234 | ||||
Environmental | 162 | 161 | ||||||
A&E reserves, net of reinsurance recoverable | 383 | 395 | ||||||
Reinsurance recoverable, net of allowance | 146 | 129 | ||||||
Gross A&E reserves | $ | 529 | $ | 524 |
2021 | 2020 | 2019 | |||||||||||||||
Number of policyholders with no indemnity payments: | |||||||||||||||||
Asbestos | 100 | 97 | 98 | ||||||||||||||
Environmental | 131 | 116 | 113 | ||||||||||||||
231 | 213 | 211 | |||||||||||||||
Number of policyholders with indemnity payments: | |||||||||||||||||
Asbestos | 45 | 48 | 46 | ||||||||||||||
Environmental | 20 | 22 | 17 | ||||||||||||||
65 | 70 | 63 | |||||||||||||||
Total | 296 | 283 | 274 |
2019 | 2018 | 2017 | |||||||
Number of policyholders with no indemnity payments: | |||||||||
Asbestos | 98 | 94 | 81 | ||||||
Environmental | 113 | 112 | 101 | ||||||
211 | 206 | 182 | |||||||
Number of policyholders with indemnity payments: | |||||||||
Asbestos | 46 | 49 | 74 | ||||||
Environmental | 17 | 32 | 31 | ||||||
63 | 81 | 105 | |||||||
Total | 274 | 287 | 287 |
2019 | 2018 | 2017 | ||||||||||
Asbestos | $ | 17 | $ | 9 | $ | 11 | ||||||
Environmental | 13 | 17 | 12 | |||||||||
Total | $ | 30 | $ | 26 | $ | 23 |
2021 | 2020 | 2019 | |||||||||||||||
Asbestos | $ | 8 | $ | 8 | $ | 17 | |||||||||||
Environmental | 6 | — | 13 | ||||||||||||||
Total | $ | 14 | $ | 8 | $ | 30 |
Property and Casualty Insurance Reserves | ||||||||
Three-Year Survival Ratio (Times Paid Losses) | ||||||||
Asbestos | Environmental | Total A&E | ||||||
AFG (12/31/2019) | 17.9 | 11.8 | 14.6 | |||||
Industry (12/31/2018) | 7.0 | 8.3 | 7.3 |
Property and Casualty Insurance Reserves | |||||||||||||||||
Three-Year Survival Ratio (Times Paid Losses) | |||||||||||||||||
Asbestos | Environmental | Total A&E | |||||||||||||||
AFG (12/31/2021) | 21.9 | 26.2 | 23.6 | ||||||||||||||
Industry (12/31/2020) | 8.6 | 6.9 | 8.2 |
Before CLO Consolidation | Managed Investment Entities | Consol. Entries | Consolidated As Reported | ||||||||||||||||||||||||||
December 31, 2021 | |||||||||||||||||||||||||||||
Assets: | |||||||||||||||||||||||||||||
Cash and investments | $ | 15,821 | $ | — | $ | (76) | (*) | $ | 15,745 | ||||||||||||||||||||
Assets of managed investment entities | — | 5,296 | — | 5,296 | |||||||||||||||||||||||||
Other assets | 7,890 | — | — | (*) | 7,890 | ||||||||||||||||||||||||
Total assets | $ | 23,711 | $ | 5,296 | $ | (76) | $ | 28,931 | |||||||||||||||||||||
Liabilities: | |||||||||||||||||||||||||||||
Unpaid losses and loss adjustment expenses and unearned premiums | $ | 14,115 | $ | — | $ | — | $ | 14,115 | |||||||||||||||||||||
Liabilities of managed investment entities | — | 5,296 | (76) | (*) | 5,220 | ||||||||||||||||||||||||
Long-term debt and other liabilities | 4,584 | — | — | 4,584 | |||||||||||||||||||||||||
Total liabilities | 18,699 | 5,296 | (76) | 23,919 | |||||||||||||||||||||||||
Shareholders’ equity: | |||||||||||||||||||||||||||||
Common Stock and Capital surplus | 1,415 | — | — | 1,415 | |||||||||||||||||||||||||
Retained earnings | 3,478 | — | — | 3,478 | |||||||||||||||||||||||||
Accumulated other comprehensive income, net of tax | 119 | — | — | 119 | |||||||||||||||||||||||||
Total shareholders’ equity | 5,012 | — | — | 5,012 | |||||||||||||||||||||||||
Total liabilities and shareholders’ equity | $ | 23,711 | $ | 5,296 | $ | (76) | $ | 28,931 | |||||||||||||||||||||
December 31, 2020 | |||||||||||||||||||||||||||||
Assets: | |||||||||||||||||||||||||||||
Cash and investments | $ | 13,550 | $ | — | $ | (56) | (*) | $ | 13,494 | ||||||||||||||||||||
Assets of managed investment entities | — | 4,971 | — | 4,971 | |||||||||||||||||||||||||
Other assets | 7,361 | — | (1) | (*) | 7,360 | ||||||||||||||||||||||||
Assets of discontinued annuity operations | 47,885 | — | — | 47,885 | |||||||||||||||||||||||||
Total assets | $ | 68,796 | $ | 4,971 | $ | (57) | $ | 73,710 | |||||||||||||||||||||
Liabilities: | |||||||||||||||||||||||||||||
Unpaid losses and loss adjustment expenses and unearned premiums | $ | 13,195 | $ | — | $ | — | $ | 13,195 | |||||||||||||||||||||
Liabilities of managed investment entities | — | 4,971 | (57) | (*) | 4,914 | ||||||||||||||||||||||||
Long-term debt and other liabilities | 4,354 | — | — | 4,354 | |||||||||||||||||||||||||
Liabilities of discontinued annuity operations | 44,458 | — | — | 44,458 | |||||||||||||||||||||||||
Total liabilities | 62,007 | 4,971 | (57) | 66,921 | |||||||||||||||||||||||||
Shareholders’ equity: | |||||||||||||||||||||||||||||
Common Stock and Capital surplus | 1,367 | — | — | 1,367 | |||||||||||||||||||||||||
Retained earnings | 4,149 | — | — | 4,149 | |||||||||||||||||||||||||
Accumulated other comprehensive income, net of tax | 1,273 | — | — | 1,273 | |||||||||||||||||||||||||
Total shareholders’ equity | 6,789 | — | — | 6,789 | |||||||||||||||||||||||||
Total liabilities and shareholders’ equity | $ | 68,796 | $ | 4,971 | $ | (57) | $ | 73,710 |
Before CLO Consolidation | Managed Investment Entities | Consol. Entries | Consolidated As Reported | ||||||||||||||
December 31, 2019 | |||||||||||||||||
Assets: | |||||||||||||||||
Cash and investments | $ | 55,416 | $ | — | $ | (164 | ) | (a) | $ | 55,252 | |||||||
Assets of managed investment entities | — | 4,736 | — | 4,736 | |||||||||||||
Other assets | 10,143 | — | (1 | ) | (a) | 10,142 | |||||||||||
Total assets | $ | 65,559 | $ | 4,736 | $ | (165 | ) | $ | 70,130 | ||||||||
Liabilities: | |||||||||||||||||
Unpaid losses and loss adjustment expenses and unearned premiums | $ | 13,062 | $ | — | $ | — | $ | 13,062 | |||||||||
Annuity, life, accident and health benefits and reserves | 41,018 | — | — | 41,018 | |||||||||||||
Liabilities of managed investment entities | — | 4,736 | (165 | ) | (a) | 4,571 | |||||||||||
Long-term debt and other liabilities | 5,210 | — | — | 5,210 | |||||||||||||
Total liabilities | 59,290 | 4,736 | (165 | ) | 63,861 | ||||||||||||
Redeemable noncontrolling interests | — | — | — | — | |||||||||||||
Shareholders’ equity: | |||||||||||||||||
Common Stock and Capital surplus | 1,397 | — | — | 1,397 | |||||||||||||
Retained earnings | 4,009 | — | — | 4,009 | |||||||||||||
Accumulated other comprehensive income, net of tax | 863 | — | — | 863 | |||||||||||||
Total shareholders’ equity | 6,269 | — | — | 6,269 | |||||||||||||
Noncontrolling interests | — | — | — | — | |||||||||||||
Total equity | 6,269 | — | — | 6,269 | |||||||||||||
Total liabilities and equity | $ | 65,559 | $ | 4,736 | $ | (165 | ) | $ | 70,130 | ||||||||
December 31, 2018 | |||||||||||||||||
Assets: | |||||||||||||||||
Cash and investments | $ | 48,685 | $ | — | $ | (187 | ) | (a) | $ | 48,498 | |||||||
Assets of managed investment entities | — | 4,700 | — | 4,700 | |||||||||||||
Other assets | 10,259 | — | (1 | ) | (a) | 10,258 | |||||||||||
Total assets | $ | 58,944 | $ | 4,700 | $ | (188 | ) | $ | 63,456 | ||||||||
Liabilities: | |||||||||||||||||
Unpaid losses and loss adjustment expenses and unearned premiums | $ | 12,336 | $ | — | $ | — | $ | 12,336 | |||||||||
Annuity, life, accident and health benefits and reserves | 37,251 | — | — | 37,251 | |||||||||||||
Liabilities of managed investment entities | — | 4,700 | (188 | ) | (a) | 4,512 | |||||||||||
Long-term debt and other liabilities | 4,385 | — | — | 4,385 | |||||||||||||
Total liabilities | 53,972 | 4,700 | (188 | ) | 58,484 | ||||||||||||
Redeemable noncontrolling interests | — | — | — | — | |||||||||||||
Shareholders’ equity: | |||||||||||||||||
Common Stock and Capital surplus | 1,334 | — | — | 1,334 | |||||||||||||
Retained earnings | 3,588 | — | — | 3,588 | |||||||||||||
Accumulated other comprehensive income, net of tax | 48 | — | — | 48 | |||||||||||||
Total shareholders’ equity | 4,970 | — | — | 4,970 | |||||||||||||
Noncontrolling interests | 2 | — | — | 2 | |||||||||||||
Total equity | 4,972 | — | — | 4,972 | |||||||||||||
Total liabilities and equity | $ | 58,944 | $ | 4,700 | $ | (188 | ) | $ | 63,456 |
Before CLO Consolidation (a) | Managed Investment Entities | Consol. Entries | Consolidated As Reported | ||||||||||||||||||||||||||
Three months ended December 31, 2021 | |||||||||||||||||||||||||||||
Revenues: | |||||||||||||||||||||||||||||
Property and casualty insurance net earned premiums | $ | 1,452 | $ | — | $ | — | $ | 1,452 | |||||||||||||||||||||
Net investment income | 212 | — | (3) | (b) | 209 | ||||||||||||||||||||||||
Realized gains (losses) on securities | 7 | — | — | 7 | |||||||||||||||||||||||||
Income of managed investment entities: | |||||||||||||||||||||||||||||
Investment income | — | 46 | — | 46 | |||||||||||||||||||||||||
Gain (loss) on change in fair value of assets/liabilities | — | 2 | (1) | (b) | 1 | ||||||||||||||||||||||||
Other income | 47 | — | (4) | (c) | 43 | ||||||||||||||||||||||||
Total revenues | 1,718 | 48 | (8) | 1,758 | |||||||||||||||||||||||||
Costs and Expenses: | |||||||||||||||||||||||||||||
Insurance benefits and expenses | 1,182 | — | — | 1,182 | |||||||||||||||||||||||||
Expenses of managed investment entities | — | 47 | (7) | (b)(c) | 40 | ||||||||||||||||||||||||
Interest charges on borrowed money and other expenses | 91 | — | — | 91 | |||||||||||||||||||||||||
Total costs and expenses | 1,273 | 47 | (7) | 1,313 | |||||||||||||||||||||||||
Earnings from continuing operations before income taxes | 445 | 1 | (1) | 445 | |||||||||||||||||||||||||
Provision for income taxes | 90 | — | — | 90 | |||||||||||||||||||||||||
Net earnings from continuing operations, including noncontrolling interests | 355 | 1 | (1) | 355 | |||||||||||||||||||||||||
Less: Net earnings (loss) from continuing operations attributable to noncontrolling interests | — | — | — | — | |||||||||||||||||||||||||
Net earnings attributable to shareholders | $ | 355 | $ | 1 | $ | (1) | $ | 355 | |||||||||||||||||||||
Three months ended December 31, 2020 | |||||||||||||||||||||||||||||
Revenues: | |||||||||||||||||||||||||||||
Property and casualty insurance net earned premiums | $ | 1,325 | $ | — | $ | — | $ | 1,325 | |||||||||||||||||||||
Net investment income | 153 | — | (6) | (b) | 147 | ||||||||||||||||||||||||
Realized gains (losses) on: | |||||||||||||||||||||||||||||
Securities | 122 | — | — | 122 | |||||||||||||||||||||||||
Subsidiaries | 53 | — | — | 53 | |||||||||||||||||||||||||
Income of managed investment entities: | |||||||||||||||||||||||||||||
Investment income | — | 47 | — | 47 | |||||||||||||||||||||||||
Gain (loss) on change in fair value of assets/liabilities | — | (1) | 2 | (b) | 1 | ||||||||||||||||||||||||
Other income | 22 | — | (4) | (c) | 18 | ||||||||||||||||||||||||
Total revenues | 1,675 | 46 | (8) | 1,713 | |||||||||||||||||||||||||
Costs and Expenses: | |||||||||||||||||||||||||||||
Insurance benefits and expenses | 1,220 | — | — | 1,220 | |||||||||||||||||||||||||
Expenses of managed investment entities | — | 46 | (8) | (b)(c) | 38 | ||||||||||||||||||||||||
Interest charges on borrowed money and other expenses | 111 | — | — | 111 | |||||||||||||||||||||||||
Total costs and expenses | 1,331 | 46 | (8) | 1,369 | |||||||||||||||||||||||||
Earnings from continuing operations before income taxes | 344 | — | — | 344 | |||||||||||||||||||||||||
Provision for income taxes | 77 | — | — | 77 | |||||||||||||||||||||||||
Net earnings from continuing operations, including noncontrolling interests | 267 | — | — | 267 | |||||||||||||||||||||||||
Net earnings from discontinued operations | 427 | — | — | 427 | |||||||||||||||||||||||||
Less: Net earnings (loss) from continuing operations attributable to noncontrolling interests | 2 | — | — | 2 | |||||||||||||||||||||||||
Net earnings attributable to shareholders | $ | 692 | $ | — | $ | — | $ | 692 |
Before CLO Consolidation (a) | Managed Investment Entities | Consol. Entries | Consolidated As Reported | ||||||||||||||
Three months ended December 31, 2019 | |||||||||||||||||
Revenues: | |||||||||||||||||
Insurance net earned premiums | $ | 1,375 | $ | — | $ | — | $ | 1,375 | |||||||||
Net investment income | 586 | — | 7 | (b) | 593 | ||||||||||||
Realized gains (losses) on securities | 65 | — | — | 65 | |||||||||||||
Income (loss) of managed investment entities: | |||||||||||||||||
Investment income | — | 63 | — | 63 | |||||||||||||
Gain (loss) on change in fair value of assets/liabilities | — | (1 | ) | (13 | ) | (b) | (14 | ) | |||||||||
Other income | 52 | — | (4 | ) | (c) | 48 | |||||||||||
Total revenues | 2,078 | 62 | (10 | ) | 2,130 | ||||||||||||
Costs and Expenses: | |||||||||||||||||
Insurance benefits and expenses | 1,695 | — | — | 1,695 | |||||||||||||
Expenses of managed investment entities | — | 62 | (10 | ) | (b)(c) | 52 | |||||||||||
Interest charges on borrowed money and other expenses | 124 | — | — | 124 | |||||||||||||
Total costs and expenses | 1,819 | 62 | (10 | ) | 1,871 | ||||||||||||
Earnings before income taxes | 259 | — | — | 259 | |||||||||||||
Provision for income taxes | 68 | — | — | 68 | |||||||||||||
Net earnings, including noncontrolling interests | 191 | — | — | 191 | |||||||||||||
Less: Net earnings (losses) attributable to noncontrolling interests | (20 | ) | — | — | (20 | ) | |||||||||||
Net earnings attributable to shareholders | $ | 211 | $ | — | $ | — | $ | 211 | |||||||||
Three months ended December 31, 2018 | |||||||||||||||||
Revenues: | |||||||||||||||||
Insurance net earned premiums | $ | 1,276 | $ | — | $ | — | $ | 1,276 | |||||||||
Net investment income | 538 | — | 4 | (b) | 542 | ||||||||||||
Realized gains (losses) on securities | (238 | ) | — | — | (238 | ) | |||||||||||
Income (loss) of managed investment entities: | |||||||||||||||||
Investment income | — | 68 | — | 68 | |||||||||||||
Gain (loss) on change in fair value of assets/liabilities | — | (1 | ) | (10 | ) | (b) | (11 | ) | |||||||||
Other income | 57 | — | (4 | ) | (c) | 53 | |||||||||||
Total revenues | 1,633 | 67 | (10 | ) | 1,690 | ||||||||||||
Costs and Expenses: | |||||||||||||||||
Insurance benefits and expenses | 1,575 | — | — | 1,575 | |||||||||||||
Expenses of managed investment entities | — | 67 | (10 | ) | (b)(c) | 57 | |||||||||||
Interest charges on borrowed money and other expenses | 97 | — | — | 97 | |||||||||||||
Total costs and expenses | 1,672 | 67 | (10 | ) | 1,729 | ||||||||||||
Earnings (loss) before income taxes | (39 | ) | — | — | (39 | ) | |||||||||||
Provision (credit) for income taxes | (4 | ) | — | — | (4 | ) | |||||||||||
Net earnings (loss), including noncontrolling interests | (35 | ) | — | — | (35 | ) | |||||||||||
Less: Net earnings (losses) attributable to noncontrolling interests | (6 | ) | — | — | (6 | ) | |||||||||||
Net earnings (loss) attributable to shareholders | $ | (29 | ) | $ | — | $ | — | $ | (29 | ) |
Before CLO Consol. (a) | Managed Investment Entities | Consol. Entries | Consolidated As Reported | ||||||||||||||||||||||||||
Year ended December 31, 2021 | |||||||||||||||||||||||||||||
Revenues: | |||||||||||||||||||||||||||||
Property and casualty insurance net earned premiums | $ | 5,404 | $ | — | $ | — | $ | 5,404 | |||||||||||||||||||||
Net investment income | 750 | — | (20) | (b) | 730 | ||||||||||||||||||||||||
Realized gains (losses) on: | |||||||||||||||||||||||||||||
Securities | 110 | — | — | 110 | |||||||||||||||||||||||||
Subsidiaries | 4 | — | — | 4 | |||||||||||||||||||||||||
Income of managed investment entities: | |||||||||||||||||||||||||||||
Investment income | — | 181 | — | 181 | |||||||||||||||||||||||||
Gain (loss) on change in fair value of assets/liabilities | — | 3 | 7 | (b) | 10 | ||||||||||||||||||||||||
Other income | 129 | — | (16) | (c) | 113 | ||||||||||||||||||||||||
Total revenues | 6,397 | 184 | (29) | 6,552 | |||||||||||||||||||||||||
Costs and Expenses: | |||||||||||||||||||||||||||||
Insurance benefits and expenses | 4,704 | — | — | 4,704 | |||||||||||||||||||||||||
Expenses of managed investment entities | — | 183 | (28) | (b)(c) | 155 | ||||||||||||||||||||||||
Interest charges on borrowed money and other expenses | 358 | — | — | 358 | |||||||||||||||||||||||||
Total costs and expenses | 5,062 | 183 | (28) | 5,217 | |||||||||||||||||||||||||
Earnings from continuing operations before income taxes | 1,335 | 1 | (1) | 1,335 | |||||||||||||||||||||||||
Provision for income taxes | 254 | — | — | 254 | |||||||||||||||||||||||||
Net earnings from continuing operations, including noncontrolling interests | 1,081 | 1 | (1) | 1,081 | |||||||||||||||||||||||||
Net earnings from discontinued operations | 914 | — | — | 914 | |||||||||||||||||||||||||
Less: Net earnings (loss) from continuing operations attributable to noncontrolling interests | — | — | — | — | |||||||||||||||||||||||||
Net earnings attributable to shareholders | $ | 1,995 | $ | 1 | $ | (1) | $ | 1,995 | |||||||||||||||||||||
Year ended December 31, 2020 | |||||||||||||||||||||||||||||
Revenues: | |||||||||||||||||||||||||||||
Property and casualty insurance net earned premiums | $ | 5,099 | $ | — | $ | — | $ | 5,099 | |||||||||||||||||||||
Net investment income | 460 | — | 1 | (b) | 461 | ||||||||||||||||||||||||
Realized gains (losses) on: | |||||||||||||||||||||||||||||
Securities | (75) | — | — | (75) | |||||||||||||||||||||||||
Subsidiaries | 23 | — | — | 23 | |||||||||||||||||||||||||
Income of managed investment entities: | |||||||||||||||||||||||||||||
Investment income | — | 201 | — | 201 | |||||||||||||||||||||||||
Gain (loss) on change in fair value of assets/liabilities | — | (11) | (9) | (b) | (20) | ||||||||||||||||||||||||
Other income | 95 | — | (15) | (c) | 80 | ||||||||||||||||||||||||
Total revenues | 5,602 | 190 | (23) | 5,769 | |||||||||||||||||||||||||
Costs and Expenses: | |||||||||||||||||||||||||||||
Insurance benefits and expenses | 4,896 | — | — | 4,896 | |||||||||||||||||||||||||
Expenses of managed investment entities | — | 190 | (23) | (b)(c) | 167 | ||||||||||||||||||||||||
Interest charges on borrowed money and other expenses | 367 | — | — | 367 | |||||||||||||||||||||||||
Total costs and expenses | 5,263 | 190 | (23) | 5,430 | |||||||||||||||||||||||||
Earnings from continuing operations before income taxes | 339 | — | — | 339 | |||||||||||||||||||||||||
Provision for income taxes | 25 | — | — | 25 | |||||||||||||||||||||||||
Net earnings from continuing operations, including noncontrolling interests | 314 | — | — | 314 | |||||||||||||||||||||||||
Net earnings from discontinued operations | 407 | — | — | 407 | |||||||||||||||||||||||||
Less: Net earnings (loss) from continuing operations attributable to noncontrolling interests | (11) | — | — | (11) | |||||||||||||||||||||||||
Net earnings attributable to shareholders | $ | 732 | $ | — | $ | — | $ | 732 |
Before CLO Consol. (a) | Managed Investment Entities | Consol. Entries | Consolidated As Reported | ||||||||||||||||||||||||||
Year ended December 31, 2019 | |||||||||||||||||||||||||||||
Revenues: | |||||||||||||||||||||||||||||
Property and casualty insurance net earned premiums | $ | 5,185 | $ | — | $ | — | $ | 5,185 | |||||||||||||||||||||
Net investment income | 533 | — | (1) | (b) | 532 | ||||||||||||||||||||||||
Realized gains (losses) on securities | 155 | — | — | 155 | |||||||||||||||||||||||||
Income of managed investment entities: | |||||||||||||||||||||||||||||
Investment income | — | 269 | — | 269 | |||||||||||||||||||||||||
Gain (loss) on change in fair value of assets/liabilities | — | (8) | (6) | (b) | (14) | ||||||||||||||||||||||||
Other income | 101 | — | (15) | (c) | 86 | ||||||||||||||||||||||||
Total revenues | 5,974 | 261 | (22) | 6,213 | |||||||||||||||||||||||||
Costs and Expenses: | |||||||||||||||||||||||||||||
Insurance benefits and expenses | 4,996 | — | — | 4,996 | |||||||||||||||||||||||||
Expenses of managed investment entities | — | 261 | (22) | (b)(c) | 239 | ||||||||||||||||||||||||
Interest charges on borrowed money and other expenses | 344 | — | — | 344 | |||||||||||||||||||||||||
Total costs and expenses | 5,340 | 261 | (22) | 5,579 | |||||||||||||||||||||||||
Earnings from continuing operations before income taxes | 634 | — | — | 634 | |||||||||||||||||||||||||
Provision for income taxes | 143 | — | — | 143 | |||||||||||||||||||||||||
Net earnings from continuing operations, including noncontrolling interests | 491 | — | — | 491 | |||||||||||||||||||||||||
Net earnings from discontinued operations | 378 | — | — | 378 | |||||||||||||||||||||||||
Less: Net earnings (loss) from continuing operations attributable to noncontrolling interests | (28) | — | — | (28) | |||||||||||||||||||||||||
Net earnings attributable to shareholders | $ | 897 | $ | — | $ | — | $ | 897 |
Before CLO Consolidation (a) | Managed Investment Entities | Consol. Entries | Consolidated As Reported | ||||||||||||||
Year ended December 31, 2019 | |||||||||||||||||
Revenues: | |||||||||||||||||
Insurance net earned premiums | $ | 5,207 | $ | — | $ | — | $ | 5,207 | |||||||||
Net investment income | 2,307 | — | (4 | ) | (b) | 2,303 | |||||||||||
Realized gains (losses) on securities | 287 | ��� | — | 287 | |||||||||||||
Income (loss) of managed investment entities: | |||||||||||||||||
Investment income | — | 269 | — | 269 | |||||||||||||
Gain (loss) on change in fair value of assets/liabilities | — | (8 | ) | (22 | ) | (b) | (30 | ) | |||||||||
Other income | 216 | — | (15 | ) | (c) | 201 | |||||||||||
Total revenues | 8,017 | 261 | (41 | ) | 8,237 | ||||||||||||
Costs and Expenses: | |||||||||||||||||
Insurance benefits and expenses | 6,436 | — | — | 6,436 | |||||||||||||
Expenses of managed investment entities | — | 261 | (41 | ) | (b)(c) | 220 | |||||||||||
Interest charges on borrowed money and other expenses | 473 | — | — | 473 | |||||||||||||
Total costs and expenses | 6,909 | 261 | (41 | ) | 7,129 | ||||||||||||
Earnings before income taxes | 1,108 | — | — | 1,108 | |||||||||||||
Provision for income taxes | 239 | — | — | 239 | |||||||||||||
Net earnings, including noncontrolling interests | 869 | — | — | 869 | |||||||||||||
Less: Net earnings (losses) attributable to noncontrolling interests | (28 | ) | — | — | (28 | ) | |||||||||||
Net earnings attributable to shareholders | $ | 897 | $ | — | $ | — | $ | 897 | |||||||||
Year ended December 31, 2018 | |||||||||||||||||
Revenues: | |||||||||||||||||
Insurance net earned premiums | $ | 4,889 | $ | — | $ | — | $ | 4,889 | |||||||||
Net investment income | 2,101 | — | (7 | ) | (b) | 2,094 | |||||||||||
Realized gains (losses) on securities | (266 | ) | — | — | (266 | ) | |||||||||||
Income (loss) of managed investment entities: | |||||||||||||||||
Investment income | — | 255 | — | 255 | |||||||||||||
Gain (loss) on change in fair value of assets/liabilities | — | (7 | ) | (14 | ) | (b) | (21 | ) | |||||||||
Other income | 215 | — | (16 | ) | (c) | 199 | |||||||||||
Total revenues | 6,939 | 248 | (37 | ) | 7,150 | ||||||||||||
Costs and Expenses: | |||||||||||||||||
Insurance benefits and expenses | 5,885 | — | — | 5,885 | |||||||||||||
Expenses of managed investment entities | — | 248 | (37 | ) | (b)(c) | 211 | |||||||||||
Interest charges on borrowed money and other expenses | 415 | — | — | 415 | |||||||||||||
Total costs and expenses | 6,300 | 248 | (37 | ) | 6,511 | ||||||||||||
Earnings before income taxes | 639 | — | — | 639 | |||||||||||||
Provision for income taxes | 122 | — | — | 122 | |||||||||||||
Net earnings, including noncontrolling interests | 517 | — | — | 517 | |||||||||||||
Less: Net earnings (losses) attributable to noncontrolling interests | (13 | ) | — | — | (13 | ) | |||||||||||
Net earnings attributable to shareholders | $ | 530 | $ | — | $ | — | $ | 530 |
Before CLO Consolidation (a) | Managed Investment Entities | Consol. Entries | Consolidated As Reported | ||||||||||||||
Year ended December 31, 2017 | |||||||||||||||||
Revenues: | |||||||||||||||||
Insurance net earned premiums | $ | 4,601 | $ | — | $ | — | $ | 4,601 | |||||||||
Net investment income | 1,854 | — | (23 | ) | (b) | 1,831 | |||||||||||
Realized gains (losses) on securities | 5 | — | — | 5 | |||||||||||||
Income (loss) of managed investment entities: | |||||||||||||||||
Investment income | — | 210 | — | 210 | |||||||||||||
Gain (loss) on change in fair value of assets/liabilities | — | 22 | (10 | ) | (b) | 12 | |||||||||||
Other income | 224 | — | (18 | ) | (c) | 206 | |||||||||||
Total revenues | 6,684 | 232 | (51 | ) | 6,865 | ||||||||||||
Costs and Expenses: | |||||||||||||||||
Insurance benefits and expenses | 5,453 | — | — | 5,453 | |||||||||||||
Expenses of managed investment entities | — | 231 | (50 | ) | (b)(c) | 181 | |||||||||||
Interest charges on borrowed money and other expenses | 507 | — | — | 507 | |||||||||||||
Total costs and expenses | 5,960 | 231 | (50 | ) | 6,141 | ||||||||||||
Earnings before income taxes | 724 | 1 | (1 | ) | 724 | ||||||||||||
Provision for income taxes | 247 | — | — | 247 | |||||||||||||
Net earnings, including noncontrolling interests | 477 | 1 | (1 | ) | 477 | ||||||||||||
Less: Net earnings (losses) attributable to noncontrolling interests | 2 | — | — | 2 | |||||||||||||
Net earnings attributable to shareholders | $ | 475 | $ | 1 | $ | (1 | ) | $ | 475 |
Three months ended December 31, | Year ended December 31, | ||||||||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | 2019 | |||||||||||||||||||||||||
Components of net earnings attributable to shareholders: | |||||||||||||||||||||||||||||
Core operating earnings before income taxes | $ | 438 | $ | 227 | $ | 1,232 | $ | 609 | $ | 589 | |||||||||||||||||||
Pretax non-core items: | |||||||||||||||||||||||||||||
Realized gains (losses) on securities | 7 | 122 | 110 | (75) | 155 | ||||||||||||||||||||||||
Special A&E charges | — | — | — | (68) | (29) | ||||||||||||||||||||||||
Neon exited lines (*) | — | — | 4 | (122) | (76) | ||||||||||||||||||||||||
Loss on retirement of debt | — | (5) | — | (5) | (5) | ||||||||||||||||||||||||
Other | — | — | (11) | — | — | ||||||||||||||||||||||||
Earnings before income taxes | 445 | 344 | 1,335 | 339 | 634 | ||||||||||||||||||||||||
Provision for income taxes: | |||||||||||||||||||||||||||||
Core operating earnings | 87 | 52 | 239 | 128 | 117 | ||||||||||||||||||||||||
Non-core items: | |||||||||||||||||||||||||||||
Realized gains (losses) on securities | 3 | 25 | 23 | (16) | 33 | ||||||||||||||||||||||||
Special A&E charges | — | — | — | (14) | (6) | ||||||||||||||||||||||||
Neon exited lines (*) | — | 1 | 1 | (72) | — | ||||||||||||||||||||||||
Loss on retirement of debt | — | (1) | — | (1) | (1) | ||||||||||||||||||||||||
Other | — | — | (9) | — | — | ||||||||||||||||||||||||
Total provision for income taxes | 90 | 77 | 254 | 25 | 143 | ||||||||||||||||||||||||
Net earnings from continuing operations, including noncontrolling interests | 355 | 267 | 1,081 | 314 | 491 | ||||||||||||||||||||||||
Net earnings from discontinued operations | — | 427 | 914 | 407 | 378 | ||||||||||||||||||||||||
Less net earnings (loss) attributable to noncontrolling interests: | |||||||||||||||||||||||||||||
Core operating earnings | — | — | — | — | (10) | ||||||||||||||||||||||||
Neon exited lines (*) | — | 2 | — | (11) | (18) | ||||||||||||||||||||||||
Total net earnings (loss) attributable to noncontrolling interests | — | 2 | — | (11) | (28) | ||||||||||||||||||||||||
Net earnings attributable to shareholders | $ | 355 | $ | 692 | $ | 1,995 | $ | 732 | $ | 897 | |||||||||||||||||||
Net earnings: | |||||||||||||||||||||||||||||
Core net operating earnings | $ | 351 | $ | 175 | $ | 993 | $ | 481 | $ | 482 | |||||||||||||||||||
Realized gains (losses) on securities | 4 | 97 | 87 | (59) | 122 | ||||||||||||||||||||||||
Special A&E charges | — | — | — | (54) | (23) | ||||||||||||||||||||||||
Neon exited lines (*) | — | (3) | 3 | (39) | (58) | ||||||||||||||||||||||||
Loss on retirement of debt | — | (4) | — | (4) | (4) | ||||||||||||||||||||||||
Other | — | — | (2) | — | — | ||||||||||||||||||||||||
Net earnings from continuing operations | 355 | 265 | 1,081 | 325 | 519 | ||||||||||||||||||||||||
Discontinued annuity operations | — | 427 | 914 | 407 | 378 | ||||||||||||||||||||||||
Net earnings attributable to shareholders | $ | 355 | $ | 692 | $ | 1,995 | $ | 732 | $ | 897 | |||||||||||||||||||
Diluted per share amounts: | |||||||||||||||||||||||||||||
Core net operating earnings | $ | 4.12 | $ | 2.01 | $ | 11.59 | $ | 5.40 | $ | 5.29 | |||||||||||||||||||
Realized gains (losses) on securities | 0.06 | 1.10 | 1.01 | (0.67) | 1.34 | ||||||||||||||||||||||||
Special A&E charges | — | — | — | (0.61) | (0.25) | ||||||||||||||||||||||||
Neon exited lines (*) | — | (0.04) | 0.04 | (0.45) | (0.64) | ||||||||||||||||||||||||
Loss on retirement of debt | — | (0.04) | — | (0.04) | (0.04) | ||||||||||||||||||||||||
Other | — | — | (0.02) | — | — | ||||||||||||||||||||||||
Diluted per share amounts, continuing operations | 4.18 | 3.03 | 12.62 | 3.63 | 5.70 | ||||||||||||||||||||||||
Discontinued annuity operations | — | 4.90 | 10.68 | 4.57 | 4.15 | ||||||||||||||||||||||||
Net earnings attributable to shareholders | $ | 4.18 | $ | 7.93 | $ | 23.30 | $ | 8.20 | $ | 9.85 |
Three months ended December 31, | Year ended December 31, | ||||||||||||||||||
2019 | 2018 | 2019 | 2018 | 2017 | |||||||||||||||
Components of net earnings (loss) attributable to shareholders: | |||||||||||||||||||
Core operating earnings before income taxes | $ | 251 | $ | 199 | $ | 967 | $ | 932 | $ | 865 | |||||||||
Pretax non-core items: | |||||||||||||||||||
Realized gains (losses) on securities | 65 | (238 | ) | 287 | (266 | ) | 5 | ||||||||||||
Annuity non-core earnings (losses) (*) | 24 | — | (36 | ) | — | — | |||||||||||||
Special A&E charges | — | — | (29 | ) | (27 | ) | (113 | ) | |||||||||||
Neon exited lines charge | (76 | ) | — | (76 | ) | — | 18 | ||||||||||||
Loss on retirement of debt | (5 | ) | — | (5 | ) | — | (51 | ) | |||||||||||
Earnings (loss) before income taxes | 259 | (39 | ) | 1,108 | 639 | 724 | |||||||||||||
Provision (credit) for income taxes: | |||||||||||||||||||
Core operating earnings | 50 | 46 | 193 | 184 | 275 | ||||||||||||||
Non-core items: | |||||||||||||||||||
Realized gains (losses) on securities | 14 | (50 | ) | 60 | (56 | ) | 2 | ||||||||||||
Annuity non-core earnings (losses) (*) | 5 | — | (7 | ) | — | — | |||||||||||||
Special A&E charges | — | — | (6 | ) | (6 | ) | (39 | ) | |||||||||||
Loss on retirement of debt | (1 | ) | — | (1 | ) | — | (18 | ) | |||||||||||
Tax benefit related to Neon restructuring | — | — | — | — | (56 | ) | |||||||||||||
Tax expense related to change in U.S. corporate tax rate | — | — | — | — | 83 | ||||||||||||||
Total provision (credit) for income taxes | 68 | (4 | ) | 239 | 122 | 247 | |||||||||||||
Net earnings (loss), including noncontrolling interests | 191 | (35 | ) | 869 | 517 | 477 | |||||||||||||
Less net earnings (losses) attributable to noncontrolling interests: | |||||||||||||||||||
Core operating earnings | (2 | ) | (6 | ) | (10 | ) | (13 | ) | 2 | ||||||||||
Neon exited lines charge | (18 | ) | — | (18 | ) | — | — | ||||||||||||
Total net earnings (losses) attributable to noncontrolling interests | (20 | ) | (6 | ) | (28 | ) | (13 | ) | 2 | ||||||||||
Net earnings (loss) attributable to shareholders | $ | 211 | $ | (29 | ) | $ | 897 | $ | 530 | $ | 475 | ||||||||
Net earnings (loss): | |||||||||||||||||||
Core net operating earnings | $ | 203 | $ | 159 | $ | 784 | $ | 761 | $ | 588 | |||||||||
Realized gains (losses) on securities | 51 | (188 | ) | 227 | (210 | ) | 3 | ||||||||||||
Annuity non-core earnings (losses) (*) | 19 | — | (29 | ) | — | — | |||||||||||||
Special A&E charges | — | — | (23 | ) | (21 | ) | (74 | ) | |||||||||||
Neon exited lines charge | (58 | ) | — | (58 | ) | — | 18 | ||||||||||||
Loss on retirement of debt | (4 | ) | — | (4 | ) | — | (33 | ) | |||||||||||
Tax benefit related to Neon restructuring | — | — | — | — | 56 | ||||||||||||||
Tax expense related to change in U.S. corporate tax rate | — | — | — | — | (83 | ) | |||||||||||||
Net earnings (loss) attributable to shareholders | $ | 211 | $ | (29 | ) | $ | 897 | $ | 530 | $ | 475 | ||||||||
Diluted per share amounts: | |||||||||||||||||||
Core net operating earnings | $ | 2.22 | $ | 1.75 | $ | 8.62 | $ | 8.40 | $ | 6.55 | |||||||||
Realized gains (losses) on securities | 0.56 | (2.08 | ) | 2.47 | (2.31 | ) | 0.03 | ||||||||||||
Annuity non-core earnings (losses) (*) | 0.21 | — | (0.31 | ) | — | — | |||||||||||||
Special A&E charges | — | — | (0.25 | ) | (0.24 | ) | (0.82 | ) | |||||||||||
Neon exited lines charge | (0.64 | ) | — | (0.64 | ) | — | 0.19 | ||||||||||||
Loss on retirement of debt | (0.04 | ) | — | (0.04 | ) | — | (0.37 | ) | |||||||||||
Tax benefit related to Neon restructuring | — | — | — | — | 0.62 | ||||||||||||||
Tax expense related to change in U.S. corporate tax rate | — | — | — | — | (0.92 | ) | |||||||||||||
Net earnings (loss) attributable to shareholders | $ | 2.31 | $ | (0.33 | ) | $ | 9.85 | $ | 5.85 | $ | 5.28 |
Other | |||||||||||||||||||||||||||||||||||||||||
P&C | Annuity | Consol. MIEs | Holding Co., other and unallocated | Total | Non-core reclass | GAAP Total | |||||||||||||||||||||||||||||||||||
Three months ended December 31, 2021 | |||||||||||||||||||||||||||||||||||||||||
Revenues: | |||||||||||||||||||||||||||||||||||||||||
Property and casualty insurance net earned premiums | $ | 1,452 | $ | — | $ | — | $ | — | $ | 1,452 | $ | — | $ | 1,452 | |||||||||||||||||||||||||||
Net investment income | 196 | — | (3) | 16 | 209 | — | 209 | ||||||||||||||||||||||||||||||||||
Realized gains (losses) on securities | — | — | — | — | — | 7 | 7 | ||||||||||||||||||||||||||||||||||
Income of MIEs: | |||||||||||||||||||||||||||||||||||||||||
Investment income | — | — | 46 | — | 46 | — | 46 | ||||||||||||||||||||||||||||||||||
Gain (loss) on change in fair value of assets/liabilities | — | — | 1 | — | 1 | — | 1 | ||||||||||||||||||||||||||||||||||
Other income | 18 | — | (4) | 29 | 43 | — | 43 | ||||||||||||||||||||||||||||||||||
Total revenues | 1,666 | — | 40 | 45 | 1,751 | 7 | 1,758 | ||||||||||||||||||||||||||||||||||
Costs and Expenses: | |||||||||||||||||||||||||||||||||||||||||
Property and casualty insurance: | |||||||||||||||||||||||||||||||||||||||||
Losses and loss adjustment expenses | 822 | — | — | — | 822 | — | 822 | ||||||||||||||||||||||||||||||||||
Commissions and other underwriting expenses | 351 | — | — | 9 | 360 | — | 360 | ||||||||||||||||||||||||||||||||||
Interest charges on borrowed money | — | — | — | 23 | 23 | — | 23 | ||||||||||||||||||||||||||||||||||
Expenses of MIEs | — | — | 40 | — | 40 | — | 40 | ||||||||||||||||||||||||||||||||||
Other expenses | 8 | — | — | 60 | 68 | — | 68 | ||||||||||||||||||||||||||||||||||
Total costs and expenses | 1,181 | — | 40 | 92 | 1,313 | — | 1,313 | ||||||||||||||||||||||||||||||||||
Earnings (loss) from continuing operations before income taxes | 485 | — | — | (47) | 438 | 7 | 445 | ||||||||||||||||||||||||||||||||||
Provision (credit) for income taxes | 102 | — | — | (15) | 87 | 3 | 90 | ||||||||||||||||||||||||||||||||||
Net earnings from continuing operations, including noncontrolling interests | 383 | — | — | (32) | 351 | 4 | 355 | ||||||||||||||||||||||||||||||||||
Less: Net earnings (loss) from continuing operations attributable to noncontrolling interests | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||
Core Net Operating Earnings | 383 | — | — | (32) | 351 | ||||||||||||||||||||||||||||||||||||
Non-core earnings attributable to shareholders (a): | |||||||||||||||||||||||||||||||||||||||||
Realized gains (losses) on securities, net of tax | — | — | — | 4 | 4 | (4) | — | ||||||||||||||||||||||||||||||||||
Net Earnings Attributable to Shareholders | $ | 383 | $ | — | $ | — | $ | (28) | $ | 355 | $ | — | $ | 355 |
Other | |||||||||||||||||||||||||||
P&C | Annuity | Consol. MIEs | Holding Co., other and unallocated | Total | Non-core reclass | GAAP Total | |||||||||||||||||||||
Three months ended December 31, 2019 | |||||||||||||||||||||||||||
Revenues: | |||||||||||||||||||||||||||
Property and casualty insurance net earned premiums | $ | 1,370 | $ | — | $ | — | $ | — | $ | 1,370 | $ | — | $ | 1,370 | |||||||||||||
Life, accident and health net earned premiums | — | — | — | 5 | 5 | — | 5 | ||||||||||||||||||||
Net investment income | 120 | 458 | 7 | 8 | 593 | — | 593 | ||||||||||||||||||||
Realized gains (losses) on securities | — | — | — | — | — | 65 | 65 | ||||||||||||||||||||
Income (loss) of MIEs: | |||||||||||||||||||||||||||
Investment income | — | — | 63 | — | 63 | — | 63 | ||||||||||||||||||||
Gain (loss) on change in fair value of assets/liabilities | — | — | (14 | ) | — | (14 | ) | — | (14 | ) | |||||||||||||||||
Other income | 1 | 26 | (4 | ) | 25 | 48 | — | 48 | |||||||||||||||||||
Total revenues | 1,491 | 484 | 52 | 38 | 2,065 | 65 | 2,130 | ||||||||||||||||||||
Costs and Expenses: | |||||||||||||||||||||||||||
Property and casualty insurance: | |||||||||||||||||||||||||||
Losses and loss adjustment expenses | 866 | — | — | — | 866 | 46 | 912 | ||||||||||||||||||||
Commissions and other underwriting expenses | 416 | — | — | 4 | 420 | 30 | 450 | ||||||||||||||||||||
Annuity benefits | — | 281 | — | — | 281 | (30 | ) | 251 | |||||||||||||||||||
Life, accident and health benefits | — | — | — | 10 | 10 | — | 10 | ||||||||||||||||||||
Annuity and supplemental insurance acquisition expenses | — | 65 | — | 1 | 66 | 6 | 72 | ||||||||||||||||||||
Interest charges on borrowed money | — | — | — | 18 | 18 | — | 18 | ||||||||||||||||||||
Expenses of MIEs | — | — | 52 | — | 52 | — | 52 | ||||||||||||||||||||
Other expenses | 12 | 34 | — | 55 | 101 | 5 | 106 | ||||||||||||||||||||
Total costs and expenses | 1,294 | 380 | 52 | 88 | 1,814 | 57 | 1,871 | ||||||||||||||||||||
Earnings before income taxes | 197 | 104 | — | (50 | ) | 251 | 8 | 259 | |||||||||||||||||||
Provision for income taxes | 39 | 21 | — | (10 | ) | 50 | 18 | 68 | |||||||||||||||||||
Net earnings, including noncontrolling interests | 158 | 83 | — | (40 | ) | 201 | (10 | ) | 191 | ||||||||||||||||||
Less: Net earnings (losses) attributable to noncontrolling interests | (2 | ) | — | — | — | (2 | ) | (18 | ) | (20 | ) | ||||||||||||||||
Core Net Operating Earnings | 160 | 83 | — | (40 | ) | 203 | |||||||||||||||||||||
Non-core earnings attributable to shareholders (a): | |||||||||||||||||||||||||||
Realized gains (losses) on securities, net of tax | — | — | — | 51 | 51 | (51 | ) | — | |||||||||||||||||||
Annuity non-core earnings (losses), net of tax (b) | — | 19 | — | — | 19 | (19 | ) | — | |||||||||||||||||||
Neon exited lines charge | (58 | ) | — | — | — | (58 | ) | 58 | — | ||||||||||||||||||
Loss on retirement of debt, net of tax | — | — | — | (4 | ) | (4 | ) | 4 | — | ||||||||||||||||||
Net Earnings Attributable to Shareholders | $ | 102 | $ | 102 | $ | — | $ | 7 | $ | 211 | $ | — | $ | 211 |
Other | |||||||||||||||||||||||||||
P&C | Annuity | Consol. MIEs | Holding Co., other and unallocated | Total | Non-core reclass | GAAP Total | |||||||||||||||||||||
Three months ended December 31, 2018 | |||||||||||||||||||||||||||
Revenues: | |||||||||||||||||||||||||||
Property and casualty insurance net earned premiums | $ | 1,270 | $ | — | $ | — | $ | — | $ | 1,270 | $ | — | $ | 1,270 | |||||||||||||
Life, accident and health net earned premiums | — | — | — | 6 | 6 | — | 6 | ||||||||||||||||||||
Net investment income | 115 | 419 | 4 | 4 | 542 | — | 542 | ||||||||||||||||||||
Realized gains (losses) on securities | — | — | — | — | — | (238 | ) | (238 | ) | ||||||||||||||||||
Income (loss) of MIEs: | |||||||||||||||||||||||||||
Investment income | — | — | 68 | — | 68 | — | 68 | ||||||||||||||||||||
Gain (loss) on change in fair value of assets/liabilities | — | — | (11 | ) | — | (11 | ) | — | (11 | ) | |||||||||||||||||
Other income | 2 | 27 | (4 | ) | 28 | 53 | — | 53 | |||||||||||||||||||
Total revenues | 1,387 | 446 | 57 | 38 | 1,928 | (238 | ) | 1,690 | |||||||||||||||||||
Costs and Expenses: | |||||||||||||||||||||||||||
Property and casualty insurance: | |||||||||||||||||||||||||||
Losses and loss adjustment expenses | 797 | — | — | — | 797 | — | 797 | ||||||||||||||||||||
Commissions and other underwriting expenses | 372 | — | — | 6 | 378 | — | 378 | ||||||||||||||||||||
Annuity benefits | — | 334 | — | — | 334 | — | 334 | ||||||||||||||||||||
Life, accident and health benefits | — | — | — | 8 | 8 | — | 8 | ||||||||||||||||||||
Annuity and supplemental insurance acquisition expenses | — | 56 | — | 2 | 58 | — | 58 | ||||||||||||||||||||
Interest charges on borrowed money | — | — | — | 16 | 16 | — | 16 | ||||||||||||||||||||
Expenses of MIEs | — | — | 57 | — | 57 | — | 57 | ||||||||||||||||||||
Other expenses | 10 | 36 | — | 35 | 81 | — | 81 | ||||||||||||||||||||
Total costs and expenses | 1,179 | 426 | 57 | 67 | 1,729 | — | 1,729 | ||||||||||||||||||||
Earnings (loss) before income taxes | 208 | 20 | — | (29 | ) | 199 | (238 | ) | (39 | ) | |||||||||||||||||
Provision (credit) for income taxes | 49 | 5 | — | (8 | ) | 46 | (50 | ) | (4 | ) | |||||||||||||||||
Net earnings (loss), including noncontrolling interests | 159 | 15 | — | (21 | ) | 153 | (188 | ) | (35 | ) | |||||||||||||||||
Less: Net earnings (losses) attributable to noncontrolling interests | (6 | ) | — | — | — | (6 | ) | — | (6 | ) | |||||||||||||||||
Core Net Operating Earnings | 165 | 15 | — | (21 | ) | 159 | |||||||||||||||||||||
Non-core earnings attributable to shareholders (a): | |||||||||||||||||||||||||||
Realized gains (losses) on securities, net of tax | — | — | — | (188 | ) | (188 | ) | 188 | — | ||||||||||||||||||
Net Earnings (Loss) Attributable to Shareholders | $ | 165 | $ | 15 | $ | — | $ | (209 | ) | $ | (29 | ) | $ | — | $ | (29 | ) |
Other | |||||||||||||||||||||||||||||||||||||||||||||||
P&C | Annuity | Consol. MIEs | Holding Co., other and unallocated | Total | Non-core reclass | Neon exited lines (b) | GAAP Total | ||||||||||||||||||||||||||||||||||||||||
Three months ended December 31, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||
Revenues: | |||||||||||||||||||||||||||||||||||||||||||||||
Property and casualty insurance net earned premiums | $ | 1,299 | $ | — | $ | — | $ | — | $ | 1,299 | $ | — | $ | 26 | $ | 1,325 | |||||||||||||||||||||||||||||||
Net investment income | 122 | 20 | (6) | 11 | 147 | — | — | 147 | |||||||||||||||||||||||||||||||||||||||
Realized gains (losses) on: | |||||||||||||||||||||||||||||||||||||||||||||||
Securities | — | — | — | — | — | 122 | — | 122 | |||||||||||||||||||||||||||||||||||||||
Subsidiaries | — | — | — | — | — | — | 53 | 53 | |||||||||||||||||||||||||||||||||||||||
Income of MIEs: | |||||||||||||||||||||||||||||||||||||||||||||||
Investment income | — | — | 47 | — | 47 | — | — | 47 | |||||||||||||||||||||||||||||||||||||||
Gain (loss) on change in fair value of assets/liabilities | — | — | 1 | — | 1 | — | — | 1 | |||||||||||||||||||||||||||||||||||||||
Other income | — | — | (4) | 22 | 18 | — | — | 18 | |||||||||||||||||||||||||||||||||||||||
Total revenues | 1,421 | 20 | 38 | 33 | 1,512 | 122 | 79 | 1,713 | |||||||||||||||||||||||||||||||||||||||
Costs and Expenses: | |||||||||||||||||||||||||||||||||||||||||||||||
Property and casualty insurance: | |||||||||||||||||||||||||||||||||||||||||||||||
Losses and loss adjustment expenses | 778 | — | — | — | 778 | — | 52 | 830 | |||||||||||||||||||||||||||||||||||||||
Commissions and other underwriting expenses | 358 | — | — | 5 | 363 | — | 27 | 390 | |||||||||||||||||||||||||||||||||||||||
Interest charges on borrowed money | — | — | — | 24 | 24 | — | — | 24 | |||||||||||||||||||||||||||||||||||||||
Expenses of MIEs | — | — | 38 | — | 38 | — | — | 38 | |||||||||||||||||||||||||||||||||||||||
Other expenses | 11 | 11 | — | 60 | 82 | 5 | — | 87 | |||||||||||||||||||||||||||||||||||||||
Total costs and expenses | 1,147 | 11 | 38 | 89 | 1,285 | 5 | 79 | 1,369 | |||||||||||||||||||||||||||||||||||||||
Earnings (loss) from continuing operations before income taxes | 274 | 9 | — | (56) | 227 | 117 | — | 344 | |||||||||||||||||||||||||||||||||||||||
Provision (credit) for income taxes | 58 | 2 | — | (8) | 52 | 24 | 1 | 77 | |||||||||||||||||||||||||||||||||||||||
Net earnings from continuing operations, including noncontrolling interests | 216 | 7 | — | (48) | 175 | 93 | (1) | 267 | |||||||||||||||||||||||||||||||||||||||
Less: Net earnings (loss) from continuing operations attributable to noncontrolling interests | — | — | — | — | — | — | 2 | 2 | |||||||||||||||||||||||||||||||||||||||
Core Net Operating Earnings | 216 | 7 | — | (48) | 175 | ||||||||||||||||||||||||||||||||||||||||||
Non-core earnings (loss) attributable to shareholders (a): | |||||||||||||||||||||||||||||||||||||||||||||||
Realized gains (losses) on securities, net of tax | — | — | — | 97 | 97 | (97) | — | — | |||||||||||||||||||||||||||||||||||||||
Discontinued operations, net of tax | — | 429 | — | (2) | 427 | — | — | 427 | |||||||||||||||||||||||||||||||||||||||
Neon exited lines (b) | (3) | — | — | — | (3) | — | 3 | — | |||||||||||||||||||||||||||||||||||||||
Loss on retirement of debt, net of tax | — | — | — | (4) | (4) | 4 | — | — | |||||||||||||||||||||||||||||||||||||||
Net Earnings Attributable to Shareholders | $ | 213 | $ | 436 | $ | — | $ | 43 | $ | 692 | $ | — | $ | — | $ | 692 |
Three months ended December 31, | |||||||||||||||||
2021 | 2020 | % Change | |||||||||||||||
Gross written premiums | $ | 1,737 | $ | 1,707 | 2 | % | |||||||||||
Reinsurance premiums ceded | (467) | (491) | (5 | %) | |||||||||||||
Net written premiums | 1,270 | 1,216 | 4 | % | |||||||||||||
Change in unearned premiums | 182 | 83 | 119 | % | |||||||||||||
Net earned premiums | 1,452 | 1,299 | 12 | % | |||||||||||||
Loss and loss adjustment expenses | 822 | 778 | 6 | % | |||||||||||||
Commissions and other underwriting expenses | 351 | 358 | (2 | %) | |||||||||||||
Core underwriting gain | 279 | 163 | 71 | % | |||||||||||||
Net investment income | 196 | 122 | 61 | % | |||||||||||||
Other income and expenses, net | 10 | (11) | (191 | %) | |||||||||||||
Core earnings before income taxes | 485 | 274 | 77 | % | |||||||||||||
Pretax non-core Neon exited lines (*) | — | — | — | % | |||||||||||||
GAAP earnings before income taxes and noncontrolling interests | $ | 485 | $ | 274 | 77 | % | |||||||||||
(*)In December 2019, AFG initiated actions to exit the Lloyd’s of London insurance market, which included placing its Lloyd’s subsidiaries including its Lloyd’s Managing Agency, Neon Underwriting Ltd. (“Neon”), into run-off. As discussed under “Results of Operations — General,” following the December 2019 decision to exit the Lloyd’s of London insurance market, the results from the Neon exited lines are treated as non-core earnings (losses). Each line item in the table above has been adjusted to remove the impact from the Neon run-off operations in 2020. The following table details the impact of the Neon exited lines to each component of earnings (loss) before income taxes in the property and casualty insurance operations for the three months ended December 31, 2020 (in millions): | |||||||||||||||||
Three months ended December 31, 2020 | |||||||||||||||||
Excluding Neon exited lines | Neon exited lines | Total | |||||||||||||||
Gross written premiums | $ | 1,707 | $ | 14 | $ | 1,721 | |||||||||||
Reinsurance premiums ceded | (491) | (1) | (492) | ||||||||||||||
Net written premiums | 1,216 | 13 | 1,229 | ||||||||||||||
Change in unearned premiums | 83 | 13 | 96 | ||||||||||||||
Net earned premiums | 1,299 | 26 | 1,325 | ||||||||||||||
Loss and loss adjustment expenses | 778 | 52 | 830 | ||||||||||||||
Commissions and other underwriting expenses | 358 | 27 | 385 | ||||||||||||||
Underwriting gain (loss) | 163 | (53) | 110 | ||||||||||||||
Net investment income | 122 | — | 122 | ||||||||||||||
Gain on sale of subsidiaries | — | 53 | 53 | ||||||||||||||
Other income and expenses, net | (11) | — | (11) | ||||||||||||||
Earnings before income taxes and noncontrolling interests | $ | 274 | $ | — | $ | 274 | |||||||||||
Three months ended December 31, | |||||||||||||||||
Combined Ratios: | 2021 | 2020 | Change | ||||||||||||||
Specialty lines | |||||||||||||||||
Loss and LAE ratio | 56.5 | % | 58.6 | % | (2.1 | %) | |||||||||||
Underwriting expense ratio | 24.2 | % | 27.6 | % | (3.4 | %) | |||||||||||
Combined ratio | 80.7 | % | 86.2 | % | (5.5 | %) | |||||||||||
Aggregate — including exited lines | |||||||||||||||||
Loss and LAE ratio | 56.6 | % | 62.6 | % | (6.0 | %) | |||||||||||
Underwriting expense ratio | 24.2 | % | 29.0 | % | (4.8 | %) | |||||||||||
Combined ratio | 80.8 | % | 91.6 | % | (10.8 | %) |
Three months ended December 31, | ||||||||||
2019 | 2018 | % Change | ||||||||
Gross written premiums | $ | 1,749 | $ | 1,613 | 8 | % | ||||
Reinsurance premiums ceded | (436 | ) | (405 | ) | 8 | % | ||||
Net written premiums | 1,313 | 1,208 | 9 | % | ||||||
Change in unearned premiums | 57 | 62 | (8 | %) | ||||||
Net earned premiums | 1,370 | 1,270 | 8 | % | ||||||
Loss and loss adjustment expenses (a) | 866 | 797 | 9 | % | ||||||
Commissions and other underwriting expenses (b) | 416 | 372 | 12 | % | ||||||
Core underwriting gain | 88 | 101 | (13 | %) | ||||||
Net investment income | 120 | 115 | 4 | % | ||||||
Other income and expenses, net | (11 | ) | (8 | ) | 38 | % | ||||
Core earnings before income taxes | 197 | 208 | (5 | %) | ||||||
Pretax non-core Neon exited lines charge | (76 | ) | — | — | % | |||||
GAAP earnings before income taxes | $ | 121 | $ | 208 | (42 | %) | ||||
Three months ended December 31, | ||||||||||
Combined Ratios: | 2019 | 2018 | Change | |||||||
Specialty lines | ||||||||||
Loss and LAE ratio (a) | 63.2 | % | 62.7 | % | 0.5 | % | ||||
Underwriting expense ratio (b) | 30.3 | % | 29.3 | % | 1.0 | % | ||||
Combined ratio | 93.5 | % | 92.0 | % | 1.5 | % | ||||
Aggregate — including exited lines | ||||||||||
Loss and LAE ratio | 66.6 | % | 62.7 | % | 3.9 | % | ||||
Underwriting expense ratio | 32.5 | % | 29.3 | % | 3.2 | % | ||||
Combined ratio | 99.1 | % | 92.0 | % | 7.1 | % |
Three months ended December 31, | |||||||||||||||||||||||||||||
2021 | 2020 | ||||||||||||||||||||||||||||
GWP | % | GWP | % | % Change | |||||||||||||||||||||||||
Property and transportation | $ | 558 | 32 | % | $ | 647 | 38 | % | (14 | %) | |||||||||||||||||||
Specialty casualty | 968 | 56 | % | 865 | 50 | % | 12 | % | |||||||||||||||||||||
Specialty financial | 211 | 12 | % | 195 | 11 | % | 8 | % | |||||||||||||||||||||
Total specialty | 1,737 | 100 | % | 1,707 | 99 | % | 2 | % | |||||||||||||||||||||
Neon exited lines | — | — | % | 14 | 1 | % | (100 | %) | |||||||||||||||||||||
Aggregate | $ | 1,737 | 100 | % | $ | 1,721 | 100 | % | 1 | % |
Three months ended December 31, | ||||||||||||||||
2019 | 2018 | |||||||||||||||
GWP | % | GWP | % | % Change | ||||||||||||
Property and transportation | $ | 628 | 36 | % | $ | 651 | 40 | % | (4 | %) | ||||||
Specialty casualty | 929 | 53 | % | 778 | 48 | % | 19 | % | ||||||||
Specialty financial | 192 | 11 | % | 184 | 12 | % | 4 | % | ||||||||
$ | 1,749 | 100 | % | $ | 1,613 | 100 | % | 8 | % |
Three months ended December 31, | |||||||||||||||||||||||||||||
2021 | 2020 | Change in | |||||||||||||||||||||||||||
Ceded | % of GWP | Ceded | % of GWP | % of GWP | |||||||||||||||||||||||||
Property and transportation | $ | (141) | 25 | % | $ | (207) | 32 | % | (7 | %) | |||||||||||||||||||
Specialty casualty | (340) | 35 | % | (300) | 35 | % | — | % | |||||||||||||||||||||
Specialty financial | (38) | 18 | % | (32) | 16 | % | 2 | % | |||||||||||||||||||||
Other specialty | 52 | 48 | |||||||||||||||||||||||||||
Total specialty | (467) | 27 | % | (491) | 29 | % | (2 | %) | |||||||||||||||||||||
Neon exited lines | — | — | % | (1) | 7 | % | (7 | %) | |||||||||||||||||||||
Aggregate | $ | (467) | 27 | % | $ | (492) | 29 | % | (2 | %) |
Three months ended December 31, | ||||||||||||||||
2019 | 2018 | Change in | ||||||||||||||
Ceded | % of GWP | Ceded | % of GWP | % of GWP | ||||||||||||
Property and transportation | $ | (179 | ) | 29 | % | $ | (203 | ) | 31 | % | (2 | %) | ||||
Specialty casualty | (260 | ) | 28 | % | (197 | ) | 25 | % | 3 | % | ||||||
Specialty financial | (36 | ) | 19 | % | (42 | ) | 23 | % | (4 | %) | ||||||
Other specialty | 39 | 37 | ||||||||||||||
$ | (436 | ) | 25 | % | $ | (405 | ) | 25 | % | — | % |
Three months ended December 31, | |||||||||||||||||||||||||||||
2021 | 2020 | ||||||||||||||||||||||||||||
NWP | % | NWP | % | % Change | |||||||||||||||||||||||||
Property and transportation | $ | 417 | 33 | % | $ | 440 | 36 | % | (5 | %) | |||||||||||||||||||
Specialty casualty | 628 | 49 | % | 565 | 46 | % | 11 | % | |||||||||||||||||||||
Specialty financial | 173 | 14 | % | 163 | 13 | % | 6 | % | |||||||||||||||||||||
Other specialty | 52 | 4 | % | 48 | 4 | % | 8 | % | |||||||||||||||||||||
Total specialty | 1,270 | 100 | % | 1,216 | 99 | % | 4 | % | |||||||||||||||||||||
Neon exited lines | — | — | % | 13 | 1 | % | (100 | %) | |||||||||||||||||||||
Aggregate | $ | 1,270 | 100 | % | $ | 1,229 | 100 | % | 3 | % |
Three months ended December 31, | ||||||||||||||||
2019 | 2018 | |||||||||||||||
NWP | % | NWP | % | % Change | ||||||||||||
Property and transportation | $ | 449 | 34 | % | $ | 448 | 37 | % | — | % | ||||||
Specialty casualty | 669 | 51 | % | 581 | 48 | % | 15 | % | ||||||||
Specialty financial | 156 | 12 | % | 142 | 12 | % | 10 | % | ||||||||
Other specialty | 39 | 3 | % | 37 | 3 | % | 5 | % | ||||||||
$ | 1,313 | 100 | % | $ | 1,208 | 100 | % | 9 | % |
Three months ended December 31, | |||||||||||||||||||||||||||||
2021 | 2020 | ||||||||||||||||||||||||||||
NEP | % | NEP | % | % Change | |||||||||||||||||||||||||
Property and transportation | $ | 597 | 41 | % | $ | 521 | 39 | % | 15 | % | |||||||||||||||||||
Specialty casualty | 636 | 44 | % | 572 | 43 | % | 11 | % | |||||||||||||||||||||
Specialty financial | 165 | 11 | % | 158 | 12 | % | 4 | % | |||||||||||||||||||||
Other specialty | 54 | 4 | % | 48 | 4 | % | 13 | % | |||||||||||||||||||||
Total specialty | 1,452 | 100 | % | 1,299 | 98 | % | 12 | % | |||||||||||||||||||||
Neon exited lines | — | — | % | 26 | 2 | % | (100 | %) | |||||||||||||||||||||
Aggregate | $ | 1,452 | 100 | % | $ | 1,325 | 100 | % | 10 | % |
Three months ended December 31, | ||||||||||||||||
2019 | 2018 | |||||||||||||||
NEP | % | NEP | % | % Change | ||||||||||||
Property and transportation | $ | 505 | 37 | % | $ | 479 | 38 | % | 5 | % | ||||||
Specialty casualty | 676 | 49 | % | 613 | 48 | % | 10 | % | ||||||||
Specialty financial | 152 | 11 | % | 141 | 11 | % | 8 | % | ||||||||
Other specialty | 37 | 3 | % | 37 | 3 | % | — | % | ||||||||
$ | 1,370 | 100 | % | $ | 1,270 | 100 | % | 8 | % |
Three months ended December 31, | Three months ended December 31, | ||||||||||||||||||||||||||||
2021 | 2020 | Change | 2021 | 2020 | |||||||||||||||||||||||||
Property and transportation | |||||||||||||||||||||||||||||
Loss and LAE ratio | 66.0 | % | 63.3 | % | 2.7 | % | |||||||||||||||||||||||
Underwriting expense ratio | 14.5 | % | 22.5 | % | (8.0 | %) | |||||||||||||||||||||||
Combined ratio | 80.5 | % | 85.8 | % | (5.3 | %) | |||||||||||||||||||||||
Underwriting profit | $ | 116 | $ | 74 | |||||||||||||||||||||||||
Specialty casualty | |||||||||||||||||||||||||||||
Loss and LAE ratio | 53.5 | % | 59.0 | % | (5.5 | %) | |||||||||||||||||||||||
Underwriting expense ratio | 24.5 | % | 25.0 | % | (0.5 | %) | |||||||||||||||||||||||
Combined ratio | 78.0 | % | 84.0 | % | (6.0 | %) | |||||||||||||||||||||||
Underwriting profit | $ | 140 | $ | 91 | |||||||||||||||||||||||||
Specialty financial | |||||||||||||||||||||||||||||
Loss and LAE ratio | 31.7 | % | 35.6 | % | (3.9 | %) | |||||||||||||||||||||||
Underwriting expense ratio | 53.8 | % | 51.2 | % | 2.6 | % | |||||||||||||||||||||||
Combined ratio | 85.5 | % | 86.8 | % | (1.3 | %) | |||||||||||||||||||||||
Underwriting profit | $ | 24 | $ | 20 | |||||||||||||||||||||||||
Total Specialty | |||||||||||||||||||||||||||||
Loss and LAE ratio | 56.5 | % | 58.6 | % | (2.1 | %) | |||||||||||||||||||||||
Underwriting expense ratio | 24.2 | % | 27.6 | % | (3.4 | %) | |||||||||||||||||||||||
Combined ratio | 80.7 | % | 86.2 | % | (5.5 | %) | |||||||||||||||||||||||
Underwriting profit | $ | 281 | $ | 179 | |||||||||||||||||||||||||
Aggregate — including exited lines | |||||||||||||||||||||||||||||
Loss and LAE ratio | 56.6 | % | 62.6 | % | (6.0 | %) | |||||||||||||||||||||||
Underwriting expense ratio | 24.2 | % | 29.0 | % | (4.8 | %) | |||||||||||||||||||||||
Combined ratio | 80.8 | % | 91.6 | % | (10.8 | %) | |||||||||||||||||||||||
Underwriting profit | $ | 279 | $ | 110 |
Three months ended December 31, | Three months ended December 31, | |||||||||||||||
2019 | 2018 | Change | 2019 | 2018 | ||||||||||||
Property and transportation | ||||||||||||||||
Loss and LAE ratio | 77.8 | % | 68.2 | % | 9.6 | % | ||||||||||
Underwriting expense ratio | 22.6 | % | 18.3 | % | 4.3 | % | ||||||||||
Combined ratio | 100.4 | % | 86.5 | % | 13.9 | % | ||||||||||
Underwriting profit (loss) | $ | (2 | ) | $ | 64 | |||||||||||
Specialty casualty | ||||||||||||||||
Loss and LAE ratio | 59.4 | % | 63.5 | % | (4.1 | %) | ||||||||||
Underwriting expense ratio | 30.3 | % | 33.0 | % | (2.7 | %) | ||||||||||
Combined ratio | 89.7 | % | 96.5 | % | (6.8 | %) | ||||||||||
Underwriting profit | $ | 69 | $ | 22 | ||||||||||||
Specialty financial | ||||||||||||||||
Loss and LAE ratio | 26.1 | % | 36.4 | % | (10.3 | %) | ||||||||||
Underwriting expense ratio | 53.5 | % | 49.1 | % | 4.4 | % | ||||||||||
Combined ratio | 79.6 | % | 85.5 | % | (5.9 | %) | ||||||||||
Underwriting profit | $ | 32 | $ | 20 | ||||||||||||
Total Specialty | ||||||||||||||||
Loss and LAE ratio | 63.2 | % | 62.7 | % | 0.5 | % | ||||||||||
Underwriting expense ratio | 30.3 | % | 29.3 | % | 1.0 | % | ||||||||||
Combined ratio | 93.5 | % | 92.0 | % | 1.5 | % | ||||||||||
Underwriting profit | $ | 89 | $ | 102 | ||||||||||||
Aggregate — including exited lines | ||||||||||||||||
Loss and LAE ratio | 66.6 | % | 62.7 | % | 3.9 | % | ||||||||||
Underwriting expense ratio | 32.5 | % | 29.3 | % | 3.2 | % | ||||||||||
Combined ratio | 99.1 | % | 92.0 | % | 7.1 | % | ||||||||||
Underwriting profit | $ | 12 | $ | 101 |
Three months ended December 31, | Three months ended December 31, | ||||||||||||||||||||||||||||||||||||||||||||
Amount | Ratio | Change in | Amount | Ratio | Change in | ||||||||||||||||||||||||||||||||||||||||
2019 | 2018 | 2019 | 2018 | Ratio | 2021 | 2020 | 2021 | 2020 | Ratio | ||||||||||||||||||||||||||||||||||||
Property and transportation | Property and transportation | ||||||||||||||||||||||||||||||||||||||||||||
Current year, excluding catastrophe losses | $ | 403 | $ | 335 | 79.9 | % | 69.9 | % | 10.0 | % | |||||||||||||||||||||||||||||||||||
Current year, excluding COVID-19 related and catastrophe losses | Current year, excluding COVID-19 related and catastrophe losses | $ | 381 | $ | 352 | 63.9 | % | 67.5 | % | (3.6 | %) | ||||||||||||||||||||||||||||||||||
Prior accident years development | (18 | ) | (7 | ) | (3.5 | %) | (1.5 | %) | (2.0 | %) | Prior accident years development | (2) | (29) | (0.4 | %) | (5.6 | %) | 5.2 | % | ||||||||||||||||||||||||||
Current year COVID-19 related losses | Current year COVID-19 related losses | — | — | — | % | 0.2 | % | (0.2 | %) | ||||||||||||||||||||||||||||||||||||
Current year catastrophe losses | 7 | (1 | ) | 1.4 | % | (0.2 | %) | 1.6 | % | Current year catastrophe losses | 15 | 6 | 2.5 | % | 1.2 | % | 1.3 | % | |||||||||||||||||||||||||||
Property and transportation losses and LAE and ratio | $ | 392 | $ | 327 | 77.8 | % | 68.2 | % | 9.6 | % | Property and transportation losses and LAE and ratio | $ | 394 | $ | 329 | 66.0 | % | 63.3 | % | 2.7 | % | ||||||||||||||||||||||||
Specialty casualty | Specialty casualty | ||||||||||||||||||||||||||||||||||||||||||||
Current year, excluding catastrophe losses | $ | 422 | $ | 413 | 62.4 | % | 67.3 | % | (4.9 | %) | |||||||||||||||||||||||||||||||||||
Current year, excluding COVID-19 related and catastrophe losses | Current year, excluding COVID-19 related and catastrophe losses | $ | 391 | $ | 336 | 61.3 | % | 59.0 | % | 2.3 | % | ||||||||||||||||||||||||||||||||||
Prior accident years development | (25 | ) | (52 | ) | (3.8 | %) | (8.5 | %) | 4.7 | % | Prior accident years development | (55) | (6) | (8.6 | %) | (1.1 | %) | (7.5 | %) | ||||||||||||||||||||||||||
Current year COVID-19 related losses | Current year COVID-19 related losses | 1 | 2 | 0.2 | % | 0.3 | % | (0.1 | %) | ||||||||||||||||||||||||||||||||||||
Current year catastrophe losses | 5 | 28 | 0.8 | % | 4.7 | % | (3.9 | %) | Current year catastrophe losses | 3 | 5 | 0.6 | % | 0.8 | % | (0.2 | %) | ||||||||||||||||||||||||||||
Specialty casualty losses and LAE and ratio | $ | 402 | $ | 389 | 59.4 | % | 63.5 | % | (4.1 | %) | Specialty casualty losses and LAE and ratio | $ | 340 | $ | 337 | 53.5 | % | 59.0 | % | (5.5 | %) | ||||||||||||||||||||||||
Specialty financial | Specialty financial | ||||||||||||||||||||||||||||||||||||||||||||
Current year, excluding catastrophe losses | $ | 52 | $ | 48 | 34.2 | % | 34.5 | % | (0.3 | %) | |||||||||||||||||||||||||||||||||||
Current year, excluding COVID-19 related and catastrophe losses | Current year, excluding COVID-19 related and catastrophe losses | $ | 58 | $ | 58 | 35.5 | % | 36.5 | % | (1.0 | %) | ||||||||||||||||||||||||||||||||||
Prior accident years development | (14 | ) | (7 | ) | (9.2 | %) | (5.2 | %) | (4.0 | %) | Prior accident years development | (13) | (6) | (8.2 | %) | (3.6 | %) | (4.6 | %) | ||||||||||||||||||||||||||
Current year COVID-19 related losses | Current year COVID-19 related losses | 1 | (3) | 0.7 | % | (1.8 | %) | 2.5 | % | ||||||||||||||||||||||||||||||||||||
Current year catastrophe losses | 2 | 10 | 1.1 | % | 7.1 | % | (6.0 | %) | Current year catastrophe losses | 6 | 7 | 3.7 | % | 4.5 | % | (0.8 | %) | ||||||||||||||||||||||||||||
Specialty financial losses and LAE and ratio | $ | 40 | $ | 51 | 26.1 | % | 36.4 | % | (10.3 | %) | Specialty financial losses and LAE and ratio | $ | 52 | $ | 56 | 31.7 | % | 35.6 | % | (3.9 | %) | ||||||||||||||||||||||||
Total Specialty | Total Specialty | ||||||||||||||||||||||||||||||||||||||||||||
Current year, excluding catastrophe losses | $ | 904 | $ | 818 | 66.0 | % | 64.4 | % | 1.6 | % | |||||||||||||||||||||||||||||||||||
Current year, excluding COVID-19 related and catastrophe losses | Current year, excluding COVID-19 related and catastrophe losses | $ | 866 | $ | 774 | 59.5 | % | 59.5 | % | — | % | ||||||||||||||||||||||||||||||||||
Prior accident years development | (53 | ) | (61 | ) | (3.8 | %) | (4.7 | %) | 0.9 | % | Prior accident years development | (73) | (32) | (5.0 | %) | (2.4 | %) | (2.6 | %) | ||||||||||||||||||||||||||
Current year COVID-19 related losses | Current year COVID-19 related losses | 2 | — | 0.2 | % | — | % | 0.2 | % | ||||||||||||||||||||||||||||||||||||
Current year catastrophe losses | 14 | 39 | 1.0 | % | 3.0 | % | (2.0 | %) | Current year catastrophe losses | 25 | 20 | 1.8 | % | 1.5 | % | 0.3 | % | ||||||||||||||||||||||||||||
Total Specialty losses and LAE and ratio | $ | 865 | $ | 796 | 63.2 | % | 62.7 | % | 0.5 | % | Total Specialty losses and LAE and ratio | $ | 820 | $ | 762 | 56.5 | % | 58.6 | % | (2.1 | %) | ||||||||||||||||||||||||
Aggregate — including exited lines | Aggregate — including exited lines | ||||||||||||||||||||||||||||||||||||||||||||
Current year, excluding catastrophe losses | $ | 943 | $ | 819 | 66.0 | % | 64.4 | % | 1.6 | % | |||||||||||||||||||||||||||||||||||
Current year, excluding COVID-19 related and catastrophe losses | Current year, excluding COVID-19 related and catastrophe losses | $ | 866 | $ | 797 | 59.6 | % | 60.1 | % | (0.5 | %) | ||||||||||||||||||||||||||||||||||
Prior accident years development | (45 | ) | (61 | ) | (0.4 | %) | (4.7 | %) | 4.3 | % | Prior accident years development | (71) | (8) | (5.0 | %) | (0.6 | %) | (4.4 | %) | ||||||||||||||||||||||||||
Current year COVID-19 related losses | Current year COVID-19 related losses | 2 | — | 0.2 | % | — | % | 0.2 | % | ||||||||||||||||||||||||||||||||||||
Current year catastrophe losses | 14 | 39 | 1.0 | % | 3.0 | % | (2.0 | %) | Current year catastrophe losses | 25 | 41 | 1.8 | % | 3.1 | % | (1.3 | %) | ||||||||||||||||||||||||||||
Aggregate losses and LAE and ratio | $ | 912 | $ | 797 | 66.6 | % | 62.7 | % | 3.9 | % | Aggregate losses and LAE and ratio | $ | 822 | $ | 830 | 56.6 | % | 62.6 | % | (6.0 | %) |
Approximate impact of modeled loss | ||||||||||||||
Industry Model | on AFG’s Shareholders’ Equity | |||||||||||||
100-year event | 1% | |||||||||||||
250-year event | ||||||||||||||
500-year event |
Three months ended December 31, | |||||||||||||||||||||||||||||
2021 | 2020 | Change in | |||||||||||||||||||||||||||
U/W Exp | % of NEP | U/W Exp | % of NEP | % of NEP | |||||||||||||||||||||||||
Property and transportation | $ | 87 | 14.5 | % | $ | 118 | 22.5 | % | (8.0 | %) | |||||||||||||||||||
Specialty casualty | 156 | 24.5 | % | 144 | 25.0 | % | (0.5 | %) | |||||||||||||||||||||
Specialty financial | 89 | 53.8 | % | 82 | 51.2 | % | 2.6 | % | |||||||||||||||||||||
Other specialty | 19 | 36.3 | % | 14 | 36.7 | % | (0.4 | %) | |||||||||||||||||||||
Total Specialty | 351 | 24.2 | % | 358 | 27.6 | % | (3.4 | %) | |||||||||||||||||||||
Neon exited lines | — | 27 | |||||||||||||||||||||||||||
Aggregate | $ | 351 | 24.2 | % | $ | 385 | 29.0 | % | (4.8 | %) |
Three months ended December 31, | ||||||||||||||||
2019 | 2018 | Change in | ||||||||||||||
U/W Exp | % of NEP | U/W Exp | % of NEP | % of NEP | ||||||||||||
Property and transportation | $ | 115 | 22.6 | % | $ | 88 | 18.3 | % | 4.3 | % | ||||||
Specialty casualty | 205 | 30.3 | % | 202 | 33.0 | % | (2.7 | %) | ||||||||
Specialty financial | 80 | 53.5 | % | 70 | 49.1 | % | 4.4 | % | ||||||||
Other specialty | 16 | 39.0 | % | 12 | 35.8 | % | 3.2 | % | ||||||||
Total Specialty | 416 | 30.3 | % | 372 | 29.3 | % | 1.0 | % | ||||||||
Neon exited lines charge | 30 | — | ||||||||||||||
Total Aggregate | $ | 446 | 32.5 | % | $ | 372 | 29.3 | % | 3.2 | % |
Three months ended December 31, | % | ||||||||||||||||||||||||||||||||||||
Three months ended December 31, | % | 2021 | 2020 | Change | Change | ||||||||||||||||||||||||||||||||
2019 | 2018 | Change | Change | ||||||||||||||||||||||||||||||||||
Net investment income | $ | 120 | $ | 115 | $ | 5 | 4 | % | |||||||||||||||||||||||||||||
Net investment income: | Net investment income: | ||||||||||||||||||||||||||||||||||||
Net investment income excluding alternative investments | Net investment income excluding alternative investments | $ | 80 | $ | 81 | $ | (1) | (1 | %) | ||||||||||||||||||||||||||||
Alternative investments | Alternative investments | 116 | 41 | 75 | 183 | % | |||||||||||||||||||||||||||||||
Total net investment income | Total net investment income | $ | 196 | $ | 122 | $ | 74 | 61 | % | ||||||||||||||||||||||||||||
Average invested assets (at amortized cost) | $ | 11,744 | $ | 10,651 | $ | 1,093 | 10 | % | Average invested assets (at amortized cost) | $ | 13,552 | $ | 12,135 | $ | 1,417 | 12 | % | ||||||||||||||||||||
Yield (net investment income as a % of average invested assets) | 4.09 | % | 4.32 | % | (0.23 | %) | Yield (net investment income as a % of average invested assets) | 5.79 | % | 4.02 | % | 1.77 | % | ||||||||||||||||||||||||
Tax equivalent yield (*) | 4.22 | % | 4.49 | % | (0.27 | %) | Tax equivalent yield (*) | 5.92 | % | 4.12 | % | 1.80 | % |
Three months ended December 31, | ||||||||||||||||||
Three months ended December 31, | 2021 | 2020 | ||||||||||||||||
Other income: | Other income: | |||||||||||||||||
Income from the sale of real estate | Income from the sale of real estate | $ | 12 | $ | — | |||||||||||||
Other | Other | 6 | — | |||||||||||||||
Total other income | Total other income | 18 | — | |||||||||||||||
Other expenses: | Other expenses: | |||||||||||||||||
Amortization of intangibles | Amortization of intangibles | 1 | 3 | |||||||||||||||
Interest expense on funds withheld | Interest expense on funds withheld | 6 | 6 | |||||||||||||||
Other | Other | 1 | 2 | |||||||||||||||
Total other expenses | Total other expenses | 8 | 11 | |||||||||||||||
Other income and expenses, net | Other income and expenses, net | $ | 10 | $ | (11) | |||||||||||||
2019 | 2018 | |||||||||||||||||
Other income | $ | 1 | $ | 2 | ||||||||||||||
Other expenses | ||||||||||||||||||
Amortization of intangibles | 2 | 2 | ||||||||||||||||
Other | 10 | 8 | ||||||||||||||||
Total other expenses | 12 | 10 | ||||||||||||||||
Other income and expenses, net | $ | (11 | ) | $ | (8 | ) |
Three months ended December 31, | ||||||||||
2019 | 2018 | % Change | ||||||||
Revenues: | ||||||||||
Net investment income | $ | 458 | $ | 419 | 9 | % | ||||
Other income: | ||||||||||
Guaranteed withdrawal benefit fees | 17 | 17 | — | % | ||||||
Policy charges and other miscellaneous income (a) | 9 | 10 | (10 | %) | ||||||
Total revenues | 484 | 446 | 9 | % | ||||||
Costs and Expenses: | ||||||||||
Annuity benefits (a)(b) | 281 | 334 | (16 | %) | ||||||
Acquisition expenses (a) | 65 | 56 | 16 | % | ||||||
Other expenses | 34 | 36 | (6 | %) | ||||||
Total costs and expenses | 380 | 426 | (11 | %) | ||||||
Core earnings before income taxes | 104 | 20 | 420 | % | ||||||
Pretax non-core earnings (losses) (a) | 24 | — | — | % | ||||||
GAAP earnings before income taxes | $ | 128 | $ | 20 | 540 | % |
Three months ended December 31, | ||||||||||
2019 | 2018 | % Change | ||||||||
Earnings before income taxes — before the impact of unlocking, derivatives related to FIAs and other impacts of stock market performance and interest rates on FIAs | $ | 104 | $ | 86 | 21 | % | ||||
Unlocking | — | (4 | ) | (100 | %) | |||||
Impact of derivatives related to FIAs and other impacts of changes in the stock market and interest rates on FIAs over or under option costs: | ||||||||||
Change in fair value of derivatives related to FIAs | (15 | ) | (80 | ) | (81 | %) | ||||
Accretion of guaranteed minimum FIA benefits | (103 | ) | (94 | ) | 10 | % | ||||
Other annuity benefits | (2 | ) | (35 | ) | (94 | %) | ||||
Less cost of equity options | 150 | 141 | 6 | % | ||||||
Related impact on the amortization of deferred policy acquisition costs | (6 | ) | 6 | (200 | %) | |||||
Earnings before income taxes | $ | 128 | $ | 20 | 540 | % |
Three months ended December 31, | |||||||||||||||||||||||||||
2019 | 2018 | Total % | |||||||||||||||||||||||||
Core | Non-core | Total | Core | Non-core | Total | Change | |||||||||||||||||||||
Interest credited — fixed | $ | 102 | $ | — | $ | 102 | $ | 92 | $ | — | $ | 92 | 11 | % | |||||||||||||
Accretion of guaranteed minimum FIA benefits | — | 103 | 103 | 94 | — | 94 | 10 | % | |||||||||||||||||||
Interest credited — fixed component of variable annuities | 1 | — | 1 | 1 | — | 1 | — | % | |||||||||||||||||||
Cost of equity options | 150 | (150 | ) | — | — | — | — | — | % | ||||||||||||||||||
Other annuity benefits: | |||||||||||||||||||||||||||
Amortization of sales inducements | 3 | — | 3 | 5 | — | 5 | (40 | %) | |||||||||||||||||||
Change in guaranteed withdrawal benefit reserve: | |||||||||||||||||||||||||||
Impact of change in the stock market and interest rates | — | (8 | ) | (8 | ) | 27 | — | 27 | (130 | %) | |||||||||||||||||
Accretion of benefits and other | 24 | — | 24 | 19 | — | 19 | 26 | % | |||||||||||||||||||
Change in expected death and annuitization reserves and other | 1 | — | 1 | 3 | — | 3 | (67 | %) | |||||||||||||||||||
Change in other benefit reserves — impact of changes in interest rates and the stock market | — | 10 | 10 | 8 | — | 8 | 25 | % | |||||||||||||||||||
Unlocking | — | — | — | 5 | — | 5 | (100 | %) | |||||||||||||||||||
Derivatives related to fixed-indexed annuities: | |||||||||||||||||||||||||||
Embedded derivative mark-to-market | — | 276 | 276 | (490 | ) | — | (490 | ) | (156 | %) | |||||||||||||||||
Equity option mark-to-market | — | (261 | ) | (261 | ) | 570 | — | 570 | (146 | %) | |||||||||||||||||
Impact of derivatives related to FIAs | — | 15 | 15 | 80 | — | 80 | (81 | %) | |||||||||||||||||||
Total annuity benefits | $ | 281 | $ | (30 | ) | $ | 251 | $ | 334 | $ | — | $ | 334 | (25 | %) |
Three months ended December 31, | |||||||
2019 | 2018 | ||||||
Interest credited — fixed | $ | 102 | $ | 92 | |||
Include cost of equity options | 150 | 141 | |||||
Cost of funds | 252 | 233 | |||||
Interest credited — fixed component of variable annuities | 1 | 1 | |||||
Other annuity benefits, excluding the impact of interest rates and the stock market on FIAs | 28 | 27 | |||||
281 | 261 | ||||||
Unlocking, changes in fair value of derivatives related to FIAs, and other impacts of the stock market and interest rates over or under option costs: | |||||||
Unlocking | — | 5 | |||||
Impact of derivatives related to FIAs | 15 | 80 | |||||
Accretion of guaranteed minimum FIA benefits | 103 | 94 | |||||
Other annuity benefits — impact of the stock market and interest rates on FIAs | 2 | 35 | |||||
Less cost of equity options (included in cost of funds) | (150 | ) | (141 | ) | |||
Total annuity benefits expense | $ | 251 | $ | 334 |
Three months ended December 31, | % | |||||||||
2019 | 2018 | Change | ||||||||
Average fixed annuity investments (at amortized cost) | $ | 39,316 | $ | 35,993 | 9 | % | ||||
Average fixed annuity benefits accumulated | 39,615 | 36,103 | 10 | % | ||||||
As % of fixed annuity benefits accumulated (except as noted): | ||||||||||
Net investment income (as % of fixed annuity investments) | 4.63 | % | 4.64 | % | ||||||
Cost of funds | (2.54 | %) | (2.58 | %) | ||||||
Other annuity benefit expenses, net of guaranteed withdrawal benefit fees (*) | (0.11 | %) | (0.12 | %) | ||||||
Net interest spread | 1.98 | % | 1.94 | % | ||||||
Policy charges and other miscellaneous income (*) | 0.07 | % | 0.08 | % | ||||||
Acquisition expenses (*) | (0.65 | %) | (0.66 | %) | ||||||
Other expenses | (0.33 | %) | (0.38 | %) | ||||||
Net spread earned on fixed annuities excluding the impact of unlocking, changes in the fair value of derivatives related to FIAs, and other impacts of changes in the stock market and interest rates on FIAs | 1.07 | % | 0.98 | % | ||||||
Changes in fair value of derivatives related to FIAs and other impacts of the stock market and interest rates under (over) option costs | 0.24 | % | (0.69 | %) | ||||||
Unlocking | — | % | (0.04 | %) | ||||||
Net spread earned on fixed annuities | 1.31 | % | 0.25 | % |
Three months ended December 31, | |||||||
2019 | 2018 | ||||||
Cost of equity options (FIAs) | $ | 150 | $ | 141 | |||
Interest credited: | |||||||
Traditional fixed annuities | 62 | 58 | |||||
Fixed component of fixed-indexed annuities | 25 | 21 | |||||
Immediate annuities | 6 | 6 | |||||
Pension risk transfer products | 3 | 1 | |||||
Federal Home Loan Bank advances | 6 | 6 | |||||
Total cost of funds | $ | 252 | $ | 233 |
Three months ended December 31, | |||||||
2019 | 2018 | ||||||
Other annuity benefits, excluding the impact of the stock market and interest rates on FIAs: | |||||||
Amortization of sales inducements | $ | 3 | $ | 5 | |||
Change in guaranteed withdrawal benefit reserve | 24 | 19 | |||||
Change in other benefit reserves | 1 | 3 | |||||
Other annuity benefits | 28 | 27 | |||||
Offset guaranteed withdrawal benefit fees | (17 | ) | (17 | ) | |||
Other annuity benefits excluding the impact of the stock market and interest rates, net | 11 | 10 | |||||
Other annuity benefits — impact of the stock market and interest rates | 2 | 35 | |||||
Other annuity benefits, net | $ | 13 | $ | 45 |
Three months ended December 31, | |||||||
2019 | 2018 | ||||||
Annuity acquisition expenses before the impact of changes in the fair value of derivatives related to FIAs and other impacts of the stock market and interest rates | $ | 65 | $ | 64 | |||
Unlocking | — | (1 | ) | ||||
Impact of changes in the fair value of derivatives and other impacts of the stock market and interest rates | 6 | (7 | ) | ||||
Annuity acquisition expenses | $ | 71 | $ | 56 |
Three months ended December 31, | |||||
2019 | 2018 | ||||
Before unlocking, the impact of changes in the fair value of derivatives related to FIAs and other impacts of the stock market and interest rates | 0.65 | % | 0.66 | % | |
Unlocking | — | % | (0.01 | %) | |
Impact of changes in fair value of derivatives and other impacts of the stock market and interest rates | 0.06 | % | (0.07 | %) | |
Annuity acquisition expenses as a % of fixed annuity benefits accumulated | 0.71 | % | 0.58 | % |
Three months ended December 31, | ||||||||||
2019 | 2018 | % Change | ||||||||
Change in the fair value of derivatives related to FIAs | $ | (15 | ) | $ | (80 | ) | (81 | %) | ||
Accretion of guaranteed minimum FIA benefits | (103 | ) | (94 | ) | 10 | % | ||||
Other annuity benefits | (2 | ) | (35 | ) | (94 | %) | ||||
Less cost of equity options | 150 | 141 | 6 | % | ||||||
Related impact on the amortization of DPAC | (6 | ) | 6 | (200 | %) | |||||
Impact on annuity segment earnings before income taxes | $ | 24 | $ | (62 | ) | (139 | %) |
Three months ended December 31, | ||||||||||
2019 | 2018 | % Change | ||||||||
Changes in the stock market, including volatility | $ | 24 | $ | (57 | ) | (142 | %) | |||
Changes in interest rates higher (lower) than expected | (4 | ) | (4 | ) | — | % | ||||
Other | 4 | (1 | ) | (500 | %) | |||||
Impact on annuity segment earnings before income taxes | $ | 24 | $ | (62 | ) | (139 | %) |
Three months ended December 31, | |||||||
2019 | 2018 | ||||||
Beginning fixed annuity reserves | $ | 39,212 | $ | 35,774 | |||
Fixed annuity premiums (receipts) | 1,134 | 1,476 | |||||
Federal Home Loan Bank advances | — | 225 | |||||
Surrenders, benefits and other withdrawals | (829 | ) | (796 | ) | |||
Interest and other annuity benefit expenses: | |||||||
Cost of funds | 252 | 233 | |||||
Embedded derivative mark-to-market | 276 | (490 | ) | ||||
Change in other benefit reserves | (27 | ) | 5 | ||||
Unlocking | — | 4 | |||||
Ending fixed annuity reserves | $ | 40,018 | $ | 36,431 | |||
Reconciliation to annuity benefits accumulated per balance sheet: | |||||||
Ending fixed annuity reserves (from above) | $ | 40,018 | $ | 36,431 | |||
Impact of unrealized investment gains | 225 | 10 | |||||
Fixed component of variable annuities | 163 | 175 | |||||
Annuity benefits accumulated per balance sheet | $ | 40,406 | $ | 36,616 |
Three months ended December 31, | ||||||||||
2019 | 2018 | % Change | ||||||||
Financial institutions single premium annuities — indexed | $ | 359 | $ | 455 | (21 | %) | ||||
Financial institutions single premium annuities — fixed | 270 | 142 | 90 | % | ||||||
Retail single premium annuities — indexed | 170 | 392 | (57 | %) | ||||||
Retail single premium annuities — fixed | 25 | 27 | (7 | %) | ||||||
Broker dealer single premium annuities — indexed | 107 | 335 | (68 | %) | ||||||
Broker dealer single premium annuities — fixed | 9 | 4 | 125 | % | ||||||
Pension risk transfer | 158 | 75 | 111 | % | ||||||
Education market — fixed and indexed annuities | 36 | 46 | (22 | %) | ||||||
Total fixed annuity premiums | 1,134 | 1,476 | (23 | %) | ||||||
Variable annuities | 5 | 6 | (17 | %) | ||||||
Total annuity premiums | $ | 1,139 | $ | 1,482 | (23 | %) |
Three months ended December 31, | ||||||||
2019 (*) | 2018 | |||||||
Policy charges and other miscellaneous income: | ||||||||
Unearned revenue | $ | — | $ | — | ||||
Total revenues | — | — | ||||||
Annuity benefits: | ||||||||
Fixed-indexed annuity embedded derivative | — | — | ||||||
Guaranteed withdrawal benefit reserve | — | (1 | ) | |||||
Other reserves | — | 5 | ||||||
Sales inducements asset | — | 1 | ||||||
Total annuity benefits | — | 5 | ||||||
Annuity and supplemental insurance acquisition expenses: | ||||||||
Deferred policy acquisition costs | — | (1 | ) | |||||
Total costs and expenses | — | 4 | ||||||
Net charge | $ | — | $ | (4 | ) |
Three months ended December 31, | |||||||
2019 | 2018 | ||||||
Earnings on fixed annuity benefits accumulated | $ | 129 | $ | 22 | |||
Earnings impact of investments in excess of fixed annuity benefits accumulated (*) | (3 | ) | (1 | ) | |||
Variable annuity earnings (loss) | 2 | (1 | ) | ||||
Earnings before income taxes | $ | 128 | $ | 20 |
Three months ended December 31, | |||||||||||||||||
2021 | 2020 | % Change | |||||||||||||||
Revenues: | |||||||||||||||||
Net investment income | $ | 16 | $ | 11 | 45 | % | |||||||||||
Other income — P&C fees | 22 | 17 | 29 | % | |||||||||||||
Other income | 7 | 5 | 40 | % | |||||||||||||
Total revenues | 45 | 33 | 36 | % | |||||||||||||
Costs and Expenses: | |||||||||||||||||
Property and casualty insurance — commissions and other underwriting expenses | 9 | 5 | 80 | % | |||||||||||||
Other expense — expenses associated with P&C fees | 13 | 12 | 8 | % | |||||||||||||
Other expenses (*) | 47 | 48 | (2 | %) | |||||||||||||
Costs and expenses, excluding interest charges on borrowed money | 69 | 65 | 6 | % | |||||||||||||
Loss before income taxes, excluding realized gains and losses and interest charges on borrowed money | (24) | (32) | (25 | %) | |||||||||||||
Interest charges on borrowed money | 23 | 24 | (4 | %) | |||||||||||||
Core loss from continuing operations before income taxes, excluding realized gains and losses | (47) | (56) | (16 | %) | |||||||||||||
Pretax non-core loss on retirement of debt | — | (5) | (100 | %) | |||||||||||||
GAAP loss from continuing operations before income taxes, excluding realized gains and losses | $ | (47) | $ | (61) | (23 | %) |
Three months ended December 31, | ||||||||||
2019 | 2018 | % Change | ||||||||
Revenues: | ||||||||||
Life, accident and health net earned premiums | $ | 5 | $ | 6 | (17 | %) | ||||
Net investment income | 8 | 4 | 100 | % | ||||||
Other income — P&C fees | 17 | 19 | (11 | %) | ||||||
Other income | 8 | 9 | (11 | %) | ||||||
Total revenues | 38 | 38 | — | % | ||||||
Costs and Expenses: | ||||||||||
Property and casualty insurance — commissions and other underwriting expenses | 4 | 6 | (33 | %) | ||||||
Life, accident and health benefits | 10 | 8 | 25 | % | ||||||
Life, accident and health acquisition expenses | 1 | 2 | (50 | %) | ||||||
Other expense — expenses associated with P&C fees | 13 | 13 | — | % | ||||||
Other expenses (*) | 42 | 22 | 91 | % | ||||||
Costs and expenses, excluding interest charges on borrowed money | 70 | 51 | 37 | % | ||||||
Core loss before income taxes, excluding realized gains and losses and interest charges on borrowed money | (32 | ) | (13 | ) | 146 | % | ||||
Interest charges on borrowed money | 18 | 16 | 13 | % | ||||||
Core loss before income taxes, excluding realized gains and losses | (50 | ) | (29 | ) | 72 | % | ||||
Pretax non-core loss on retirement of debt | (5 | ) | — | — | % | |||||
GAAP loss before income taxes, excluding realized gains and losses | $ | (55 | ) | $ | (29 | ) | 90 | % |
(*)Excludes a pretax non-core loss on retirement of debt of $5 |
December 31, 2019 | December 31, 2018 | ||||||
Direct obligations of AFG: | |||||||
4.50% Senior Notes due June 2047 | $ | 590 | $ | 590 | |||
3.50% Senior Notes due August 2026 | 425 | 425 | |||||
5.125% Subordinated Debentures due December 2059 | 200 | — | |||||
6% Subordinated Debentures due November 2055 | 150 | 150 | |||||
5.875% Subordinated Debentures due March 2059 | 125 | — | |||||
6-1/4% Subordinated Debentures due September 2054 | — | 150 | |||||
Other | 3 | 3 | |||||
Total principal amount of Holding Company Debt | $ | 1,493 | $ | 1,318 | |||
Weighted Average Interest Rate | 4.6 | % | 4.6 | % |
Three months ended December 31, | |||||||
2019 | 2018 | ||||||
Realized gains (losses) before impairments: | |||||||
Disposals | $ | 8 | $ | (2 | ) | ||
Change in the fair value of equity securities (*) | 67 | (223 | ) | ||||
Change in the fair value of derivatives | (5 | ) | 3 | ||||
Adjustments to annuity deferred policy acquisition costs and related items | 1 | — | |||||
71 | (222 | ) | |||||
Impairment charges: | |||||||
Securities | (9 | ) | (23 | ) | |||
Adjustments to annuity deferred policy acquisition costs and related items | 3 | 7 | |||||
(6 | ) | (16 | ) | ||||
Realized gains (losses) on securities | $ | 65 | $ | (238 | ) |
Three months ended December 31, | |||||||||||
2021 | 2020 | ||||||||||
Realized gains (losses) before impairments: | |||||||||||
Disposals | $ | 3 | $ | 2 | |||||||
Change in the fair value of equity securities | 6 | 120 | |||||||||
Change in the fair value of derivatives | (2) | (1) | |||||||||
7 | 121 | ||||||||||
Change in allowance for impairments on securities | — | 1 | |||||||||
Realized gains (losses) on securities | $ | 7 | $ | 122 |
Three months ended December 31, | |||||||||||||
2019 | 2018 | ||||||||||||
Amount | % of EBT | Amount | % of EBT | ||||||||||
Earnings (loss) before income taxes (“EBT”) | $ | 259 | $ | (39 | ) | ||||||||
Income taxes at statutory rate | $ | 55 | 21 | % | $ | (8 | ) | 21 | % | ||||
Effect of: | |||||||||||||
Tax exempt interest | (3 | ) | (1 | %) | (3 | ) | 8 | % | |||||
Stock-based compensation | (2 | ) | (1 | %) | (1 | ) | 3 | % | |||||
Dividend received deduction | (1 | ) | — | % | (1 | ) | 3 | % | |||||
Employee stock ownership plan dividend paid deduction | (1 | ) | — | % | (1 | ) | 3 | % | |||||
Adjustment to prior year taxes | — | — | % | 1 | (3 | %) | |||||||
Change in valuation allowance | 10 | 4 | % | 8 | (21 | %) | |||||||
Foreign operations | 4 | 2 | % | (5 | ) | 13 | % | ||||||
Nondeductible expenses | 2 | 1 | % | 2 | (5 | %) | |||||||
Other | 4 | — | % | 4 | (12 | %) | |||||||
Provision (credit) for income taxes | $ | 68 | 26 | % | $ | (4 | ) | 10 | % |
Three months ended December 31, | |||||||||||||||||||||||
2021 | 2020 | ||||||||||||||||||||||
Amount | % of EBT | Amount | % of EBT | ||||||||||||||||||||
Earnings before income taxes (“EBT”) | $ | 445 | $ | 344 | |||||||||||||||||||
Income taxes at statutory rate | $ | 93 | 21 | % | $ | 72 | 21 | % | |||||||||||||||
Effect of: | |||||||||||||||||||||||
Employee stock ownership plan dividend paid deduction | (6) | (1 | %) | (1) | — | % | |||||||||||||||||
Stock-based compensation | (1) | — | % | (1) | — | % | |||||||||||||||||
Tax exempt interest | (2) | — | % | (3) | (1 | %) | |||||||||||||||||
Change in valuation allowance | (5) | (1 | %) | (148) | (43 | %) | |||||||||||||||||
Dividend received deduction | (1) | — | % | — | — | % | |||||||||||||||||
Tax benefit related to sale of Neon | — | — | % | 1 | — | % | |||||||||||||||||
Nondeductible expenses | 2 | — | % | 1 | — | % | |||||||||||||||||
Foreign operations | — | — | % | 152 | 44 | % | |||||||||||||||||
Other | 10 | 1 | % | 4 | 1 | % | |||||||||||||||||
Provision for income taxes | $ | 90 | 20 | % | $ | 77 | 22 | % |
Other | |||||||||||||||||||||||||||||||||||||||||
P&C | Annuity | Consol. MIEs | Holding Co., other and unallocated | Total | Non-core reclass | GAAP Total | |||||||||||||||||||||||||||||||||||
Year ended December 31, 2021 | |||||||||||||||||||||||||||||||||||||||||
Revenues: | |||||||||||||||||||||||||||||||||||||||||
Property and casualty insurance net earned premiums | $ | 5,404 | $ | — | $ | — | $ | — | $ | 5,404 | $ | — | $ | 5,404 | |||||||||||||||||||||||||||
Net investment income | 663 | 51 | (20) | 36 | 730 | — | 730 | ||||||||||||||||||||||||||||||||||
Realized gains (losses) on: | |||||||||||||||||||||||||||||||||||||||||
Securities | — | — | — | — | — | 110 | 110 | ||||||||||||||||||||||||||||||||||
Subsidiaries | — | — | — | — | — | 4 | 4 | ||||||||||||||||||||||||||||||||||
Income of MIEs: | |||||||||||||||||||||||||||||||||||||||||
Investment income | — | — | 181 | — | 181 | — | 181 | ||||||||||||||||||||||||||||||||||
Gain (loss) on change in fair value of assets/liabilities | — | — | 10 | — | 10 | — | 10 | ||||||||||||||||||||||||||||||||||
Other income | 27 | — | (16) | 102 | 113 | — | 113 | ||||||||||||||||||||||||||||||||||
Total revenues | 6,094 | 51 | 155 | 138 | 6,438 | 114 | 6,552 | ||||||||||||||||||||||||||||||||||
Costs and Expenses: | |||||||||||||||||||||||||||||||||||||||||
Property and casualty insurance: | |||||||||||||||||||||||||||||||||||||||||
Losses and loss adjustment expenses | 3,157 | — | — | — | 3,157 | — | 3,157 | ||||||||||||||||||||||||||||||||||
Commissions and other underwriting expenses | 1,514 | — | — | 33 | 1,547 | — | 1,547 | ||||||||||||||||||||||||||||||||||
Interest charges on borrowed money | — | — | — | 94 | 94 | — | 94 | ||||||||||||||||||||||||||||||||||
Expenses of MIEs | — | — | 155 | — | 155 | — | 155 | ||||||||||||||||||||||||||||||||||
Other expenses | 33 | 1 | — | 219 | 253 | 11 | 264 | ||||||||||||||||||||||||||||||||||
Total costs and expenses | 4,704 | 1 | 155 | 346 | 5,206 | 11 | 5,217 | ||||||||||||||||||||||||||||||||||
Earnings (loss) from continuing operations before income taxes | 1,390 | 50 | — | (208) | 1,232 | 103 | 1,335 | ||||||||||||||||||||||||||||||||||
Provision (credit) for income taxes | 279 | 11 | — | (51) | 239 | 15 | 254 | ||||||||||||||||||||||||||||||||||
Net earnings from continuing operations, including noncontrolling interests | 1,111 | 39 | — | (157) | 993 | 88 | 1,081 | ||||||||||||||||||||||||||||||||||
Less: Net earnings (loss) from continuing operations attributable to noncontrolling interests | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||
Core Net Operating Earnings | 1,111 | 39 | — | (157) | 993 | ||||||||||||||||||||||||||||||||||||
Non-core earnings (loss) attributable to shareholders (a): | |||||||||||||||||||||||||||||||||||||||||
Realized gains (losses) on securities, net of tax | — | — | — | 87 | 87 | (87) | — | ||||||||||||||||||||||||||||||||||
Discontinued operations, net of tax | — | 914 | — | — | 914 | — | 914 | ||||||||||||||||||||||||||||||||||
Neon exited lines (b) | 3 | — | — | — | 3 | (3) | — | ||||||||||||||||||||||||||||||||||
Other, net of tax | — | — | — | (2) | (2) | 2 | — | ||||||||||||||||||||||||||||||||||
Net Earnings Attributable to Shareholders | $ | 1,114 | $ | 953 | $ | — | $ | (72) | $ | 1,995 | $ | — | $ | 1,995 |
Other | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other | P&C | Annuity | Consol. MIEs | Holding Co., other and unallocated | Total | Non-core reclass | Neon exited lines (b) | GAAP Total | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
P&C | Annuity | Consol. MIEs | Holding Co., other and unallocated | Total | Non-core reclass | GAAP Total | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended December 31, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended December 31, 2020 | Year ended December 31, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenues: | Revenues: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property and casualty insurance net earned premiums | $ | 5,185 | $ | — | $ | — | $ | — | $ | 5,185 | $ | — | $ | 5,185 | Property and casualty insurance net earned premiums | $ | 4,899 | $ | — | $ | — | $ | — | $ | 4,899 | $ | — | $ | 200 | $ | 5,099 | |||||||||||||||||||||||||||||||||||||||||||
Life, accident and health net earned premiums | — | — | — | 22 | 22 | — | 22 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net investment income | 472 | 1,792 | (4 | ) | 43 | 2,303 | — | 2,303 | Net investment income | 404 | 49 | 1 | 12 | 466 | — | (5) | 461 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Realized gains (losses) on securities | — | — | — | — | — | 287 | 287 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income (loss) of MIEs: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Realized gains (losses) on: | Realized gains (losses) on: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Securities | Securities | — | — | — | — | — | (75) | — | (75) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Subsidiaries | Subsidiaries | — | — | — | — | — | — | 23 | 23 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income of MIEs: | Income of MIEs: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investment income | — | — | 269 | — | 269 | — | 269 | Investment income | — | — | 201 | — | 201 | — | — | 201 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Gain (loss) on change in fair value of assets/liabilities | — | — | (30 | ) | — | (30 | ) | — | (30 | ) | Gain (loss) on change in fair value of assets/liabilities | — | — | (20) | — | (20) | — | — | (20) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other income | 11 | 107 | (15 | ) | 97 | 200 | 1 | 201 | Other income | 8 | 1 | (15) | 86 | 80 | — | — | 80 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total revenues | 5,668 | 1,899 | 220 | 162 | 7,949 | 288 | 8,237 | Total revenues | 5,311 | 50 | 167 | 98 | 5,626 | (75) | 218 | 5,769 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Costs and Expenses: | Costs and Expenses: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property and casualty insurance: | Property and casualty insurance: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Losses and loss adjustment expenses | 3,207 | — | — | — | 3,207 | 64 | 3,271 | Losses and loss adjustment expenses | 3,006 | — | — | — | 3,006 | 47 | 218 | 3,271 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commissions and other underwriting expenses | 1,672 | — | — | 23 | 1,695 | 30 | 1,725 | Commissions and other underwriting expenses | 1,487 | — | — | 21 | 1,508 | — | 117 | 1,625 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Annuity benefits | — | 1,140 | — | — | 1,140 | 11 | 1,151 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Life, accident and health benefits | — | — | — | 36 | 36 | — | 36 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Annuity and supplemental insurance acquisition expenses | — | 222 | — | 5 | 227 | 26 | 253 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Interest charges on borrowed money | — | — | — | 68 | 68 | — | 68 | Interest charges on borrowed money | — | — | — | 88 | 88 | — | — | 88 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Expenses of MIEs | — | — | 220 | — | 220 | — | 220 | Expenses of MIEs | — | — | 167 | — | 167 | — | — | 167 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other expenses | 46 | 139 | — | 204 | 389 | 16 | 405 | Other expenses | 42 | 31 | — | 175 | 248 | 26 | 5 | 279 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total costs and expenses | 4,925 | 1,501 | 220 | 336 | 6,982 | 147 | 7,129 | Total costs and expenses | 4,535 | 31 | 167 | 284 | 5,017 | 73 | 340 | 5,430 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings before income taxes | 743 | 398 | — | (174 | ) | 967 | 141 | 1,108 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Provision for income taxes | 150 | 80 | — | (37 | ) | 193 | 46 | 239 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net earnings, including noncontrolling interests | 593 | 318 | — | (137 | ) | 774 | 95 | 869 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Less: Net earnings (losses) attributable to noncontrolling interests | (10 | ) | — | — | — | (10 | ) | (18 | ) | (28 | ) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings (loss) from continuing operations before income taxes | Earnings (loss) from continuing operations before income taxes | 776 | 19 | — | (186) | 609 | (148) | (122) | 339 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Provision (credit) for income taxes | Provision (credit) for income taxes | 164 | 4 | — | (40) | 128 | (31) | (72) | 25 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net earnings from continuing operations, including noncontrolling interests | Net earnings from continuing operations, including noncontrolling interests | 612 | 15 | — | (146) | 481 | (117) | (50) | 314 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Less: Net earnings (loss) from continuing operations attributable to noncontrolling interests | Less: Net earnings (loss) from continuing operations attributable to noncontrolling interests | — | — | — | — | — | — | (11) | (11) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Core Net Operating Earnings | 603 | 318 | — | (137 | ) | 784 | Core Net Operating Earnings | 612 | 15 | — | (146) | 481 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Non-core earnings attributable to shareholders (a): | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Non-core earnings (loss) attributable to shareholders (a): | Non-core earnings (loss) attributable to shareholders (a): | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Realized gains (losses) on securities, net of tax | — | — | — | 227 | 227 | (227 | ) | — | Realized gains (losses) on securities, net of tax | — | — | — | (59) | (59) | 59 | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Annuity non-core earnings (losses), net of tax (b) | — | (29 | ) | — | — | (29 | ) | 29 | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Neon exited lines charge | (58 | ) | — | — | — | (58 | ) | 58 | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Discontinued operations, net of tax | Discontinued operations, net of tax | — | 413 | — | (6) | 407 | — | — | 407 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Neon exited lines (b) | Neon exited lines (b) | (39) | — | — | — | (39) | — | 39 | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Special A&E charges, net of tax | (14 | ) | — | — | (9 | ) | (23 | ) | 23 | — | Special A&E charges, net of tax | (37) | — | — | (17) | (54) | 54 | — | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loss on retirement of debt, net of tax | — | — | — | (4 | ) | (4 | ) | 4 | — | Loss on retirement of debt, net of tax | — | — | — | (4) | (4) | 4 | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Earnings Attributable to Shareholders | $ | 531 | $ | 289 | $ | — | $ | 77 | $ | 897 | $ | — | $ | 897 | Net Earnings Attributable to Shareholders | $ | 536 | $ | 428 | $ | — | $ | (232) | $ | 732 | $ | — | $ | — | $ | 732 |
Other | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other | P&C | Annuity | Consol. MIEs | Holding Co., other and unallocated | Total | Non-core reclass | GAAP Total | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
P&C | Annuity | Consol. MIEs | Holding Co., other and unallocated | Total | Non-core reclass | GAAP Total | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended December 31, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended December 31, 2019 | Year ended December 31, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenues: | Revenues: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property and casualty insurance net earned premiums | $ | 4,865 | $ | — | $ | — | $ | — | $ | 4,865 | $ | — | $ | 4,865 | Property and casualty insurance net earned premiums | $ | 5,185 | $ | — | $ | — | $ | — | $ | 5,185 | $ | — | $ | 5,185 | |||||||||||||||||||||||||||||||||||||||
Life, accident and health net earned premiums | — | — | — | 24 | 24 | — | 24 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net investment income | 438 | 1,638 | (7 | ) | 25 | 2,094 | — | 2,094 | Net investment income | 472 | 37 | (1) | 24 | 532 | — | 532 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Realized gains (losses) on securities | — | — | — | — | — | (266 | ) | (266 | ) | Realized gains (losses) on securities | — | — | — | — | — | 155 | 155 | |||||||||||||||||||||||||||||||||||||||||||||||||||
Income (loss) of MIEs: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income of MIEs: | Income of MIEs: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investment income | — | — | 255 | — | 255 | — | 255 | Investment income | — | — | 269 | — | 269 | — | 269 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Gain (loss) on change in fair value of assets/liabilities | — | — | (21 | ) | — | (21 | ) | — | (21 | ) | Gain (loss) on change in fair value of assets/liabilities | — | — | (14) | — | (14) | — | (14) | ||||||||||||||||||||||||||||||||||||||||||||||||||
Other income | 10 | 107 | (16 | ) | 98 | 199 | — | 199 | Other income | 11 | — | (15) | 90 | 86 | — | 86 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Total revenues | 5,313 | 1,745 | 211 | 147 | 7,416 | (266 | ) | 7,150 | Total revenues | 5,668 | 37 | 239 | 114 | 6,058 | 155 | 6,213 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Costs and Expenses: | Costs and Expenses: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property and casualty insurance: | Property and casualty insurance: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Losses and loss adjustment expenses | 2,985 | — | — | — | 2,985 | 18 | 3,003 | Losses and loss adjustment expenses | 3,207 | — | — | — | 3,207 | 64 | 3,271 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Commissions and other underwriting expenses | 1,560 | — | — | 23 | 1,583 | — | 1,583 | Commissions and other underwriting expenses | 1,672 | — | — | 23 | 1,695 | 30 | 1,725 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Annuity benefits | — | 998 | — | — | 998 | — | 998 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Life, accident and health benefits | — | — | — | 40 | 40 | — | 40 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Annuity and supplemental insurance acquisition expenses | — | 255 | — | 6 | 261 | — | 261 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Interest charges on borrowed money | — | — | — | 62 | 62 | — | 62 | Interest charges on borrowed money | — | — | — | 68 | 68 | — | 68 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Expenses of MIEs | — | — | 211 | — | 211 | — | 211 | Expenses of MIEs | — | — | 239 | — | 239 | — | 239 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Other expenses | 41 | 131 | — | 172 | 344 | 9 | 353 | Other expenses | 46 | 16 | — | 198 | 260 | 16 | 276 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Total costs and expenses | 4,586 | 1,384 | 211 | 303 | 6,484 | 27 | 6,511 | Total costs and expenses | 4,925 | 16 | 239 | 289 | 5,469 | 110 | 5,579 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings before income taxes | 727 | 361 | — | (156 | ) | 932 | (293 | ) | 639 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Provision for income taxes | 149 | 70 | — | (35 | ) | 184 | (62 | ) | 122 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net earnings, including noncontrolling interests | 578 | 291 | — | (121 | ) | 748 | (231 | ) | 517 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Less: Net earnings (losses) attributable to noncontrolling interests | (13 | ) | — | — | — | (13 | ) | — | (13 | ) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings (loss) from continuing operations before income taxes | Earnings (loss) from continuing operations before income taxes | 743 | 21 | — | (175) | 589 | 45 | 634 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Provision (credit) for income taxes | Provision (credit) for income taxes | 150 | 4 | — | (37) | 117 | 26 | 143 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net earnings from continuing operations, including noncontrolling interests | Net earnings from continuing operations, including noncontrolling interests | 593 | 17 | — | (138) | 472 | 19 | 491 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Less: Net earnings (loss) from continuing operations attributable to noncontrolling interests | Less: Net earnings (loss) from continuing operations attributable to noncontrolling interests | (10) | — | — | — | (10) | (18) | (28) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Core Net Operating Earnings | 591 | 291 | — | (121 | ) | 761 | Core Net Operating Earnings | 603 | 17 | — | (138) | 482 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Non-core earnings attributable to shareholders (a): | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Non-core earnings (loss) attributable to shareholders (a): | Non-core earnings (loss) attributable to shareholders (a): | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Realized gains (losses) on securities, net of tax | — | — | — | (210 | ) | (210 | ) | 210 | — | Realized gains (losses) on securities, net of tax | — | — | — | 122 | 122 | (122) | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
Discontinued operations, net of tax | Discontinued operations, net of tax | — | 377 | — | 1 | 378 | — | 378 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Special A&E charges, net of tax | (14 | ) | — | — | (7 | ) | (21 | ) | 21 | — | Special A&E charges, net of tax | (14) | — | — | (9) | (23) | 23 | — | ||||||||||||||||||||||||||||||||||||||||||||||||||
Neon exited lines charge | Neon exited lines charge | (58) | — | — | — | (58) | 58 | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loss on retirement of debt, net of tax | Loss on retirement of debt, net of tax | — | — | — | (4) | (4) | 4 | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Earnings Attributable to Shareholders | $ | 577 | $ | 291 | $ | — | $ | (338 | ) | $ | 530 | $ | — | $ | 530 | Net Earnings Attributable to Shareholders | $ | 531 | $ | 394 | $ | — | $ | (28) | $ | 897 | $ | — | $ | 897 |
Other | |||||||||||||||||||||||||||
P&C | Annuity | Consol. MIEs | Holding Co., other and unallocated | Total | Non-core reclass | GAAP Total | |||||||||||||||||||||
Year ended December 31, 2017 | |||||||||||||||||||||||||||
Revenues: | |||||||||||||||||||||||||||
Property and casualty insurance net earned premiums | $ | 4,579 | $ | — | $ | — | $ | — | $ | 4,579 | $ | — | $ | 4,579 | |||||||||||||
Life, accident and health net earned premiums | — | — | — | 22 | 22 | — | 22 | ||||||||||||||||||||
Net investment income | 362 | 1,458 | (23 | ) | 34 | 1,831 | — | 1,831 | |||||||||||||||||||
Realized gains (losses) on securities | — | — | — | — | — | 5 | 5 | ||||||||||||||||||||
Income (loss) of MIEs: | |||||||||||||||||||||||||||
Investment income | — | — | 210 | — | 210 | — | 210 | ||||||||||||||||||||
Gain (loss) on change in fair value of assets/liabilities | — | — | 12 | — | 12 | — | 12 | ||||||||||||||||||||
Other income | 28 | 103 | (18 | ) | 93 | 206 | — | 206 | |||||||||||||||||||
Total revenues | 4,969 | 1,561 | 181 | 149 | 6,860 | 5 | 6,865 | ||||||||||||||||||||
Costs and Expenses: | |||||||||||||||||||||||||||
Property and casualty insurance: | |||||||||||||||||||||||||||
Losses and loss adjustment expenses | 2,884 | — | — | — | 2,884 | 71 | 2,955 | ||||||||||||||||||||
Commissions and other underwriting expenses | 1,382 | — | — | 25 | 1,407 | — | 1,407 | ||||||||||||||||||||
Annuity benefits | — | 892 | — | — | 892 | — | 892 | ||||||||||||||||||||
Life, accident and health benefits | — | — | — | 26 | 26 | — | 26 | ||||||||||||||||||||
Annuity and supplemental insurance acquisition expenses | — | 168 | — | 5 | 173 | — | 173 | ||||||||||||||||||||
Interest charges on borrowed money | — | — | — | 85 | 85 | — | 85 | ||||||||||||||||||||
Expenses of MIEs | — | — | 181 | — | 181 | — | 181 | ||||||||||||||||||||
Other expenses | 41 | 121 | — | 185 | 347 | 75 | 422 | ||||||||||||||||||||
Total costs and expenses | 4,307 | 1,181 | 181 | 326 | 5,995 | 146 | 6,141 | ||||||||||||||||||||
Earnings before income taxes | 662 | 380 | — | (177 | ) | 865 | (141 | ) | 724 | ||||||||||||||||||
Provision for income taxes | 219 | 128 | — | (72 | ) | 275 | (28 | ) | 247 | ||||||||||||||||||
Net earnings, including noncontrolling interests | 443 | 252 | — | (105 | ) | 590 | (113 | ) | 477 | ||||||||||||||||||
Less: Net earnings (losses) attributable to noncontrolling interests | 2 | — | — | — | 2 | — | 2 | ||||||||||||||||||||
Core Net Operating Earnings | 441 | 252 | — | (105 | ) | 588 | |||||||||||||||||||||
Non-core earnings attributable to shareholders (a): | |||||||||||||||||||||||||||
Realized gains (losses) on securities, net of tax | — | — | — | 3 | 3 | (3 | ) | — | |||||||||||||||||||
Special A&E charges, net of tax | (58 | ) | — | — | (16 | ) | (74 | ) | 74 | — | |||||||||||||||||
Neon exited lines charge | 18 | — | — | — | 18 | (18 | ) | — | |||||||||||||||||||
Loss on retirement of debt, net of tax | — | — | — | (33 | ) | (33 | ) | 33 | — | ||||||||||||||||||
Tax benefit related to Neon restructuring | 56 | — | — | — | 56 | (56 | ) | — | |||||||||||||||||||
Tax expense related to change in U.S. corporate tax rate | (88 | ) | 25 | — | (20 | ) | (83 | ) | 83 | — | |||||||||||||||||
Net Earnings Attributable to Shareholders | $ | 369 | $ | 277 | $ | — | $ | (171 | ) | $ | 475 | $ | — | $ | 475 |
(a)See the reconciliation of core earnings to GAAP net earnings under “Results of Operations — General” for details on the tax and noncontrolling interest |
Year ended December 31, | % Change | ||||||||||||||||||||||||||||
2021 | 2020 | 2019 | 2021 - 2020 | 2020 - 2019 | |||||||||||||||||||||||||
Gross written premiums | $ | 7,946 | $ | 6,995 | $ | 7,299 | 14 | % | (4 | %) | |||||||||||||||||||
Reinsurance premiums ceded | (2,373) | (2,003) | (1,957) | 18 | % | 2 | % | ||||||||||||||||||||||
Net written premiums | 5,573 | 4,992 | 5,342 | 12 | % | (7 | %) | ||||||||||||||||||||||
Change in unearned premiums | (169) | (93) | (157) | 82 | % | (41 | %) | ||||||||||||||||||||||
Net earned premiums | 5,404 | 4,899 | 5,185 | 10 | % | (6 | %) | ||||||||||||||||||||||
Loss and loss adjustment expenses (a) | 3,157 | 3,006 | 3,207 | 5 | % | (6 | %) | ||||||||||||||||||||||
Commissions and other underwriting expenses | 1,514 | 1,487 | 1,672 | 2 | % | (11 | %) | ||||||||||||||||||||||
Core underwriting gain | 733 | 406 | 306 | 81 | % | 33 | % | ||||||||||||||||||||||
Net investment income | 663 | 404 | 472 | 64 | % | (14 | %) | ||||||||||||||||||||||
Other income and expenses, net | (6) | (34) | (35) | (82 | %) | (3 | %) | ||||||||||||||||||||||
Core earnings before income taxes | 1,390 | 776 | 743 | 79 | % | 4 | % | ||||||||||||||||||||||
Pretax non-core special A&E charges | — | (47) | (18) | (100 | %) | 161 | % | ||||||||||||||||||||||
Pretax non-core Neon exited lines (b) | 4 | (122) | (76) | (103 | %) | 61 | % | ||||||||||||||||||||||
GAAP earnings before income taxes and noncontrolling interests | $ | 1,394 | $ | 607 | $ | 649 | 130 | % | (6 | %) | |||||||||||||||||||
(a)Excludes pretax non-core special A&E charges of $47 million and $18 million in 2020 and 2019, respectively. (b)In December 2019, AFG initiated actions to exit the Lloyd’s of London insurance market, which included placing its Lloyd’s subsidiaries including its Lloyd’s Managing Agency, Neon Underwriting Ltd. (“Neon”), into run-off. As discussed under “Results of Operations — General,” following the December 2019 decision to exit the Lloyd’s of London insurance market, the results from the Neon exited lines are treated as non-core earnings (losses). Each line item in the table above has been adjusted to remove the impact from the Neon run-off operations in 2020. The following table details the impact of the Neon exited lines to each component of earnings (loss) before income taxes in the property and casualty insurance operations for the year ended December 31, 2020 (in millions): | |||||||||||||||||||||||||||||
December 31, 2020 | |||||||||||||||||||||||||||||
Excluding Neon exited lines | Neon exited lines | Total | |||||||||||||||||||||||||||
Gross written premiums | $ | 6,995 | $ | 92 | $ | 7,087 | |||||||||||||||||||||||
Reinsurance premiums ceded | (2,003) | (71) | (2,074) | ||||||||||||||||||||||||||
Net written premiums | 4,992 | 21 | 5,013 | ||||||||||||||||||||||||||
Change in unearned premiums | (93) | 179 | 86 | ||||||||||||||||||||||||||
Net earned premiums | 4,899 | 200 | 5,099 | ||||||||||||||||||||||||||
Loss and loss adjustment expenses | 3,006 | 218 | 3,224 | ||||||||||||||||||||||||||
Commissions and other underwriting expenses | 1,487 | 117 | 1,604 | ||||||||||||||||||||||||||
Underwriting gain (loss) | 406 | (135) | 271 | ||||||||||||||||||||||||||
Net investment income | 404 | (5) | 399 | ||||||||||||||||||||||||||
Gain on sale of subsidiaries | — | 23 | 23 | ||||||||||||||||||||||||||
Other income and expenses, net | (34) | (5) | (39) | ||||||||||||||||||||||||||
Earnings (loss) before income taxes and noncontrolling interests | 776 | (122) | 654 | ||||||||||||||||||||||||||
Pretax non-core special A&E charges | (47) | — | (47) | ||||||||||||||||||||||||||
GAAP earnings (loss) before income taxes and noncontrolling interests | $ | 729 | $ | (122) | $ | 607 | |||||||||||||||||||||||
Year ended December 31, | % Change | ||||||||||||||||
2019 | 2018 | 2017 | 2019 - 2018 | 2018 - 2017 | |||||||||||||
Gross written premiums | $ | 7,299 | $ | 6,840 | $ | 6,502 | 7 | % | 5 | % | |||||||
Reinsurance premiums ceded | (1,957 | ) | (1,817 | ) | (1,751 | ) | 8 | % | 4 | % | |||||||
Net written premiums | 5,342 | 5,023 | 4,751 | 6 | % | 6 | % | ||||||||||
Change in unearned premiums | (157 | ) | (158 | ) | (172 | ) | (1 | %) | (8 | %) | |||||||
Net earned premiums | 5,185 | 4,865 | 4,579 | 7 | % | 6 | % | ||||||||||
Loss and loss adjustment expenses (a) | 3,207 | 2,985 | 2,884 | 7 | % | 4 | % | ||||||||||
Commissions and other underwriting expenses (b) | 1,672 | 1,560 | 1,382 | 7 | % | 13 | % | ||||||||||
Core underwriting gain | 306 | 320 | 313 | (4 | %) | 2 | % | ||||||||||
Net investment income | 472 | 438 | 362 | 8 | % | 21 | % | ||||||||||
Other income and expenses, net | (35 | ) | (31 | ) | (13 | ) | 13 | % | 138 | % | |||||||
Core earnings before income taxes | 743 | 727 | 662 | 2 | % | 10 | % | ||||||||||
Pretax non-core special A&E charges | (18 | ) | (18 | ) | (89 | ) | — | % | (80 | %) | |||||||
Pretax non-core Neon exited lines charge | (76 | ) | — | 18 | — | % | (100 | %) | |||||||||
GAAP earnings before income taxes | $ | 649 | $ | 709 | $ | 591 | (8 | %) | 20 | % | |||||||
Year ended December 31, | Change | ||||||||||||||||
Combined Ratios: | 2019 | 2018 | 2017 | 2019 - 2018 | 2018 - 2017 | ||||||||||||
Specialty lines | |||||||||||||||||
Loss and LAE ratio (a) | 61.5 | % | 61.3 | % | 62.9 | % | 0.2 | % | (1.6 | %) | |||||||
Underwriting expense ratio (b) | 32.2 | % | 32.1 | % | 30.2 | % | 0.1 | % | 1.9 | % | |||||||
Combined ratio | 93.7 | % | 93.4 | % | 93.1 | % | 0.3 | % | 0.3 | % | |||||||
Aggregate — including exited lines | |||||||||||||||||
Loss and LAE ratio | 63.0 | % | 61.7 | % | 64.5 | % | 1.3 | % | (2.8 | %) | |||||||
Underwriting expense ratio | 32.8 | % | 32.1 | % | 30.2 | % | 0.7 | % | 1.9 | % | |||||||
Combined ratio | 95.8 | % | 93.8 | % | 94.7 | % | 2.0 | % | (0.9 | %) |
Year ended December 31, | Change | ||||||||||||||||||||||||||||
Combined Ratios: | 2021 | 2020 | 2019 | 2021 - 2020 | 2020 - 2019 | ||||||||||||||||||||||||
Specialty lines | |||||||||||||||||||||||||||||
Loss and LAE ratio | 58.4 | % | 60.9 | % | 61.5 | % | (2.5 | %) | (0.6 | %) | |||||||||||||||||||
Underwriting expense ratio | 28.0 | % | 30.4 | % | 32.2 | % | (2.4 | %) | (1.8 | %) | |||||||||||||||||||
Combined ratio | 86.4 | % | 91.3 | % | 93.7 | % | (4.9 | %) | (2.4 | %) | |||||||||||||||||||
Aggregate — including exited lines | |||||||||||||||||||||||||||||
Loss and LAE ratio | 58.5 | % | 64.1 | % | 63.0 | % | (5.6 | %) | 1.1 | % | |||||||||||||||||||
Underwriting expense ratio | 28.0 | % | 31.4 | % | 32.8 | % | (3.4 | %) | (1.4 | %) | |||||||||||||||||||
Combined ratio | 86.5 | % | 95.5 | % | 95.8 | % | (9.0 | %) | (0.3 | %) |
Year ended December 31, | % Change | ||||||||||||||||||||||||||||||||||||||||||||||
2021 | 2020 | 2019 | 2021 - 2020 | 2020 - 2019 | |||||||||||||||||||||||||||||||||||||||||||
GWP | % | GWP | % | GWP | % | ||||||||||||||||||||||||||||||||||||||||||
Property and transportation | $ | 3,263 | 41 | % | $ | 2,813 | 40 | % | $ | 2,759 | 38 | % | 16 | % | 2 | % | |||||||||||||||||||||||||||||||
Specialty casualty | 3,890 | 49 | % | 3,444 | 49 | % | 3,768 | 52 | % | 13 | % | (9 | %) | ||||||||||||||||||||||||||||||||||
Specialty financial | 793 | 10 | % | 738 | 10 | % | 772 | 10 | % | 7 | % | (4 | %) | ||||||||||||||||||||||||||||||||||
Total specialty | 7,946 | 100 | % | 6,995 | 99 | % | 7,299 | 100 | % | 14 | % | (4 | %) | ||||||||||||||||||||||||||||||||||
Neon exited lines | — | — | % | 92 | 1 | % | — | — | % | (100 | %) | — | % | ||||||||||||||||||||||||||||||||||
Aggregate | $ | 7,946 | 100 | % | $ | 7,087 | 100 | % | $ | 7,299 | 100 | % | 12 | % | (3 | %) |
Year ended December 31, | % Change | |||||||||||||||||||||||||
2019 | 2018 | 2017 | 2019 - 2018 | 2018 - 2017 | ||||||||||||||||||||||
GWP | % | GWP | % | GWP | % | |||||||||||||||||||||
Property and transportation | $ | 2,759 | 38 | % | $ | 2,645 | 39 | % | $ | 2,688 | 41 | % | 4 | % | (2 | %) | ||||||||||
Specialty casualty | 3,768 | 52 | % | 3,445 | 50 | % | 3,087 | 48 | % | 9 | % | 12 | % | |||||||||||||
Specialty financial | 772 | 10 | % | 750 | 11 | % | 727 | 11 | % | 3 | % | 3 | % | |||||||||||||
$ | 7,299 | 100 | % | $ | 6,840 | 100 | % | $ | 6,502 | 100 | % | 7 | % | 5 | % |
Year ended December 31, | Change in % of GWP | ||||||||||||||||||||||||||||||||||||||||||||||
2021 | 2020 | 2019 | 2021 - 2020 | 2020 - 2019 | |||||||||||||||||||||||||||||||||||||||||||
Ceded | % of GWP | Ceded | % of GWP | Ceded | % of GWP | ||||||||||||||||||||||||||||||||||||||||||
Property and transportation | $ | (1,106) | 34 | % | $ | (926) | 33 | % | $ | (883) | 32 | % | 1 | % | 1 | % | |||||||||||||||||||||||||||||||
Specialty casualty | (1,350) | 35 | % | (1,140) | 33 | % | (1,067) | 28 | % | 2 | % | 5 | % | ||||||||||||||||||||||||||||||||||
Specialty financial | (135) | 17 | % | (134) | 18 | % | (155) | 20 | % | (1 | %) | (2 | %) | ||||||||||||||||||||||||||||||||||
Other specialty | 218 | 197 | 148 | ||||||||||||||||||||||||||||||||||||||||||||
Total specialty | (2,373) | 30 | % | (2,003) | 29 | % | (1,957) | 27 | % | 1 | % | 2 | % | ||||||||||||||||||||||||||||||||||
Neon exited lines | — | — | % | (71) | 77 | % | — | — | % | (77 | %) | 77 | % | ||||||||||||||||||||||||||||||||||
Aggregate | $ | (2,373) | 30 | % | $ | (2,074) | 29 | % | $ | (1,957) | 27 | % | 1 | % | 2 | % |
Year ended December 31, | Change in % of GWP | |||||||||||||||||||||||||
2019 | 2018 | 2017 | 2019 - 2018 | 2018 - 2017 | ||||||||||||||||||||||
Ceded | % of GWP | Ceded | % of GWP | Ceded | % of GWP | |||||||||||||||||||||
Property and transportation | $ | (883 | ) | 32 | % | $ | (891 | ) | 34 | % | $ | (923 | ) | 34 | % | (2 | %) | — | % | |||||||
Specialty casualty | (1,067 | ) | 28 | % | (936 | ) | 27 | % | (807 | ) | 26 | % | 1 | % | 1 | % | ||||||||||
Specialty financial | (155 | ) | 20 | % | (148 | ) | 20 | % | (131 | ) | 18 | % | — | % | 2 | % | ||||||||||
Other specialty | 148 | 158 | 110 | |||||||||||||||||||||||
$ | (1,957 | ) | 27 | % | $ | (1,817 | ) | 27 | % | $ | (1,751 | ) | 27 | % | — | % | — | % |
Year ended December 31, | % Change | ||||||||||||||||||||||||||||||||||||||||||||||
2021 | 2020 | 2019 | 2021 - 2020 | 2020 - 2019 | |||||||||||||||||||||||||||||||||||||||||||
NWP | % | NWP | % | NWP | % | ||||||||||||||||||||||||||||||||||||||||||
Property and transportation | $ | 2,157 | 40 | % | $ | 1,887 | 38 | % | $ | 1,876 | 35 | % | 14 | % | 1 | % | |||||||||||||||||||||||||||||||
Specialty casualty | 2,540 | 46 | % | 2,304 | 46 | % | 2,701 | 51 | % | 10 | % | (15 | %) | ||||||||||||||||||||||||||||||||||
Specialty financial | 658 | 12 | % | 604 | 12 | % | 617 | 12 | % | 9 | % | (2 | %) | ||||||||||||||||||||||||||||||||||
Other specialty | 218 | 4 | % | 197 | 4 | % | 148 | 2 | % | 11 | % | 33 | % | ||||||||||||||||||||||||||||||||||
Total specialty | 5,573 | 102 | % | 4,992 | 100 | % | 5,342 | 100 | % | 12 | % | (7 | %) | ||||||||||||||||||||||||||||||||||
Neon exited lines | — | — | % | 21 | — | % | — | — | % | (100 | %) | — | % | ||||||||||||||||||||||||||||||||||
Aggregate | $ | 5,573 | 100 | % | $ | 5,013 | 100 | % | $ | 5,342 | 100 | % | 11 | % | (6 | %) |
Year ended December 31, | % Change | |||||||||||||||||||||||||
2019 | 2018 | 2017 | 2019 - 2018 | 2018 - 2017 | ||||||||||||||||||||||
NWP | % | NWP | % | NWP | % | |||||||||||||||||||||
Property and transportation | $ | 1,876 | 35 | % | $ | 1,754 | 35 | % | $ | 1,765 | 37 | % | 7 | % | (1 | %) | ||||||||||
Specialty casualty | 2,701 | 51 | % | 2,509 | 50 | % | 2,280 | 48 | % | 8 | % | 10 | % | |||||||||||||
Specialty financial | 617 | 12 | % | 602 | 12 | % | 596 | 13 | % | 2 | % | 1 | % | |||||||||||||
Other specialty | 148 | 2 | % | 158 | 3 | % | 110 | 2 | % | (6 | %) | 44 | % | |||||||||||||
$ | 5,342 | 100 | % | $ | 5,023 | 100 | % | $ | 4,751 | 100 | % | 6 | % | 6 | % |
Year ended December 31, | % Change | ||||||||||||||||||||||||||||||||||||||||||||||
2021 | 2020 | 2019 | 2021 - 2020 | 2020 - 2019 | |||||||||||||||||||||||||||||||||||||||||||
NEP | % | NEP | % | NEP | % | ||||||||||||||||||||||||||||||||||||||||||
Property and transportation | $ | 2,144 | 40 | % | $ | 1,871 | 37 | % | $ | 1,828 | 35 | % | 15 | % | 2 | % | |||||||||||||||||||||||||||||||
Specialty casualty | 2,408 | 44 | % | 2,235 | 44 | % | 2,597 | 50 | % | 8 | % | (14 | %) | ||||||||||||||||||||||||||||||||||
Specialty financial | 642 | 12 | % | 613 | 12 | % | 610 | 12 | % | 5 | % | — | % | ||||||||||||||||||||||||||||||||||
Other specialty | 210 | 4 | % | 180 | 3 | % | 150 | 3 | % | 17 | % | 20 | % | ||||||||||||||||||||||||||||||||||
Total specialty | 5,404 | 100 | % | 4,899 | 96 | % | 5,185 | 100 | % | 10 | % | (6 | %) | ||||||||||||||||||||||||||||||||||
Neon exited lines | — | — | % | 200 | 4 | % | — | — | % | (100 | %) | — | % | ||||||||||||||||||||||||||||||||||
Aggregate | $ | 5,404 | 100 | % | $ | 5,099 | 100 | % | $ | 5,185 | 100 | % | 6 | % | (2 | %) |
Year ended December 31, | % Change | |||||||||||||||||||||||||
2019 | 2018 | 2017 | 2019 - 2018 | 2018 - 2017 | ||||||||||||||||||||||
NEP | % | NEP | % | NEP | % | |||||||||||||||||||||
Property and transportation | $ | 1,828 | 35 | % | $ | 1,729 | 36 | % | $ | 1,711 | 37 | % | 6 | % | 1 | % | ||||||||||
Specialty casualty | 2,597 | 50 | % | 2,403 | 49 | % | 2,186 | 48 | % | 8 | % | 10 | % | |||||||||||||
Specialty financial | 610 | 12 | % | 598 | 12 | % | 576 | 13 | % | 2 | % | 4 | % | |||||||||||||
Other specialty | 150 | 3 | % | 135 | 3 | % | 106 | 2 | % | 11 | % | 27 | % | |||||||||||||
$ | 5,185 | 100 | % | $ | 4,865 | 100 | % | $ | 4,579 | 100 | % | 7 | % | 6 | % |
Year ended December 31, | Change | Year ended December 31, | Year ended December 31, | Change | Year ended December 31, | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2019 | 2018 | 2017 | 2019 - 2018 | 2018 - 2017 | 2019 | 2018 | 2017 | 2021 | 2020 | 2019 | 2021 - 2020 | 2020 - 2019 | 2021 | 2020 | 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property and transportation | Property and transportation | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loss and LAE ratio | 71.0 | % | 69.0 | % | 68.5 | % | 2.0 | % | 0.5 | % | Loss and LAE ratio | 65.1 | % | 64.6 | % | 71.0 | % | 0.5 | % | (6.4 | %) | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Underwriting expense ratio | 24.7 | % | 24.1 | % | 22.5 | % | 0.6 | % | 1.6 | % | Underwriting expense ratio | 22.0 | % | 25.8 | % | 24.7 | % | (3.8 | %) | 1.1 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Combined ratio | 95.7 | % | 93.1 | % | 91.0 | % | 2.6 | % | 2.1 | % | Combined ratio | 87.1 | % | 90.4 | % | 95.7 | % | (3.3 | %) | (5.3 | %) | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Underwriting profit | $ | 79 | $ | 120 | $ | 154 | Underwriting profit | $ | 279 | $ | 181 | $ | 79 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Specialty casualty | Specialty casualty | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loss and LAE ratio | 61.1 | % | 61.5 | % | 64.5 | % | (0.4 | %) | (3.0 | %) | Loss and LAE ratio | 58.1 | % | 62.5 | % | 61.1 | % | (4.4 | %) | 1.4 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Underwriting expense ratio | 32.2 | % | 32.7 | % | 30.7 | % | (0.5 | %) | 2.0 | % | Underwriting expense ratio | 26.2 | % | 27.5 | % | 32.2 | % | (1.3 | %) | (4.7 | %) | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Combined ratio | 93.3 | % | 94.2 | % | 95.2 | % | (0.9 | %) | (1.0 | %) | Combined ratio | 84.3 | % | 90.0 | % | 93.3 | % | (5.7 | %) | (3.3 | %) | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Underwriting profit | $ | 175 | $ | 141 | $ | 104 | Underwriting profit | $ | 377 | $ | 223 | $ | 175 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Specialty financial | Specialty financial | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loss and LAE ratio | 31.5 | % | 37.6 | % | 39.4 | % | (6.1 | %) | (1.8 | %) | Loss and LAE ratio | 33.2 | % | 39.5 | % | 31.5 | % | (6.3 | %) | 8.0 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Underwriting expense ratio | 53.5 | % | 51.3 | % | 50.0 | % | 2.2 | % | 1.3 | % | Underwriting expense ratio | 51.9 | % | 52.3 | % | 53.5 | % | (0.4 | %) | (1.2 | %) | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Combined ratio | 85.0 | % | 88.9 | % | 89.4 | % | (3.9 | %) | (0.5 | %) | Combined ratio | 85.1 | % | 91.8 | % | 85.0 | % | (6.7 | %) | 6.8 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Underwriting profit | $ | 92 | $ | 66 | $ | 61 | Underwriting profit | $ | 96 | $ | 50 | $ | 92 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total Specialty | Total Specialty | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loss and LAE ratio | 61.5 | % | 61.3 | % | 62.9 | % | 0.2 | % | (1.6 | %) | Loss and LAE ratio | 58.4 | % | 60.9 | % | 61.5 | % | (2.5 | %) | (0.6 | %) | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Underwriting expense ratio | 32.2 | % | 32.1 | % | 30.2 | % | 0.1 | % | 1.9 | % | Underwriting expense ratio | 28.0 | % | 30.4 | % | 32.2 | % | (2.4 | %) | (1.8 | %) | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Combined ratio | 93.7 | % | 93.4 | % | 93.1 | % | 0.3 | % | 0.3 | % | Combined ratio | 86.4 | % | 91.3 | % | 93.7 | % | (4.9 | %) | (2.4 | %) | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Underwriting profit | $ | 325 | $ | 322 | $ | 317 | Underwriting profit | $ | 737 | $ | 426 | $ | 325 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Aggregate — including exited lines | Aggregate — including exited lines | Aggregate — including exited lines | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loss and LAE ratio | 63.0 | % | 61.7 | % | 64.5 | % | 1.3 | % | (2.8 | %) | Loss and LAE ratio | 58.5 | % | 64.1 | % | 63.0 | % | (5.6 | %) | 1.1 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Underwriting expense ratio | 32.8 | % | 32.1 | % | 30.2 | % | 0.7 | % | 1.9 | % | Underwriting expense ratio | 28.0 | % | 31.4 | % | 32.8 | % | (3.4 | %) | (1.4 | %) | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Combined ratio | 95.8 | % | 93.8 | % | 94.7 | % | 2.0 | % | (0.9 | %) | Combined ratio | 86.5 | % | 95.5 | % | 95.8 | % | (9.0 | %) | (0.3 | %) | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Underwriting profit | $ | 212 | $ | 302 | $ | 242 | Underwriting profit | $ | 733 | $ | 224 | $ | 212 |
Year ended December 31, | |||||||||||||||||||||||||||||||||||||||||||||||
Amount | Ratio | Change in Ratio | |||||||||||||||||||||||||||||||||||||||||||||
2021 | 2020 | 2019 | 2021 | 2020 | 2019 | 2021 - 2020 | 2020 - 2019 | ||||||||||||||||||||||||||||||||||||||||
Property and transportation | |||||||||||||||||||||||||||||||||||||||||||||||
Current year, excluding COVID-19 related and catastrophe losses | $ | 1,448 | $ | 1,261 | $ | 1,332 | 67.6 | % | 67.4 | % | 72.8 | % | 0.2 | % | (5.4 | %) | |||||||||||||||||||||||||||||||
Prior accident years development | (103) | (107) | (67) | (4.8 | %) | (5.7 | %) | (3.6 | %) | 0.9 | % | (2.1 | %) | ||||||||||||||||||||||||||||||||||
Current year COVID-19 related losses | — | 7 | — | — | % | 0.4 | % | — | % | (0.4 | %) | 0.4 | % | ||||||||||||||||||||||||||||||||||
Current year catastrophe losses | 49 | 47 | 32 | 2.3 | % | 2.5 | % | 1.8 | % | (0.2 | %) | 0.7 | % | ||||||||||||||||||||||||||||||||||
Property and transportation losses and LAE and ratio | $ | 1,394 | $ | 1,208 | $ | 1,297 | 65.1 | % | 64.6 | % | 71.0 | % | 0.5 | % | (6.4 | %) | |||||||||||||||||||||||||||||||
Specialty casualty | |||||||||||||||||||||||||||||||||||||||||||||||
Current year, excluding COVID-19 related and catastrophe losses | $ | 1,521 | $ | 1,419 | $ | 1,657 | 63.2 | % | 63.5 | % | 63.8 | % | (0.3 | %) | (0.3 | %) | |||||||||||||||||||||||||||||||
Prior accident years development | (140) | (97) | (88) | (5.9 | %) | (4.3 | %) | (3.4 | %) | (1.6 | %) | (0.9 | %) | ||||||||||||||||||||||||||||||||||
Current year COVID-19 related losses | 9 | 60 | — | 0.4 | % | 2.7 | % | — | % | (2.3 | %) | 2.7 | % | ||||||||||||||||||||||||||||||||||
Current year catastrophe losses | 9 | 14 | 17 | 0.4 | % | 0.6 | % | 0.7 | % | (0.2 | %) | (0.1 | %) | ||||||||||||||||||||||||||||||||||
Specialty casualty losses and LAE and ratio | $ | 1,399 | $ | 1,396 | $ | 1,586 | 58.1 | % | 62.5 | % | 61.1 | % | (4.4 | %) | 1.4 | % | |||||||||||||||||||||||||||||||
Specialty financial | |||||||||||||||||||||||||||||||||||||||||||||||
Current year, excluding COVID-19 related and catastrophe losses | $ | 231 | $ | 218 | $ | 220 | 36.1 | % | 35.4 | % | 36.2 | % | 0.7 | % | (0.8 | %) | |||||||||||||||||||||||||||||||
Prior accident years development | (51) | (28) | (38) | (8.0 | %) | (4.5 | %) | (6.3 | %) | (3.5 | %) | 1.8 | % | ||||||||||||||||||||||||||||||||||
Current year COVID-19 related losses | 7 | 26 | — | 1.1 | % | 4.3 | % | — | % | (3.2 | %) | 4.3 | % | ||||||||||||||||||||||||||||||||||
Current year catastrophe losses | 26 | 26 | 10 | 4.0 | % | 4.3 | % | 1.6 | % | (0.3 | %) | 2.7 | % | ||||||||||||||||||||||||||||||||||
Specialty financial losses and LAE and ratio | $ | 213 | $ | 242 | $ | 192 | 33.2 | % | 39.5 | % | 31.5 | % | (6.3 | %) | 8.0 | % | |||||||||||||||||||||||||||||||
Total Specialty | |||||||||||||||||||||||||||||||||||||||||||||||
Current year, excluding COVID-19 related and catastrophe losses | $ | 3,334 | $ | 3,013 | $ | 3,315 | 61.7 | % | 61.5 | % | 64.0 | % | 0.2 | % | (2.5 | %) | |||||||||||||||||||||||||||||||
Prior accident years development | (283) | (213) | (187) | (5.2 | %) | (4.4 | %) | (3.7 | %) | (0.8 | %) | (0.7 | %) | ||||||||||||||||||||||||||||||||||
Current year COVID-19 related losses | 16 | 95 | — | 0.3 | % | 1.9 | % | — | % | (1.6 | %) | 1.9 | % | ||||||||||||||||||||||||||||||||||
Current year catastrophe losses | 86 | 91 | 60 | 1.6 | % | 1.9 | % | 1.2 | % | (0.3 | %) | 0.7 | % | ||||||||||||||||||||||||||||||||||
Total Specialty losses and LAE and ratio | $ | 3,153 | $ | 2,986 | $ | 3,188 | 58.4 | % | 60.9 | % | 61.5 | % | (2.5 | %) | (0.6 | %) | |||||||||||||||||||||||||||||||
Aggregate — including exited lines | |||||||||||||||||||||||||||||||||||||||||||||||
Current year, excluding COVID-19 related and catastrophe losses | $ | 3,334 | $ | 3,155 | $ | 3,354 | 61.7 | % | 61.9 | % | 64.6 | % | (0.2 | %) | (2.7 | %) | |||||||||||||||||||||||||||||||
Prior accident years development | (279) | (127) | (143) | (5.1 | %) | (2.5 | %) | (2.8 | %) | (2.6 | %) | 0.3 | % | ||||||||||||||||||||||||||||||||||
Current year COVID-19 related losses | 16 | 115 | — | 0.3 | % | 2.2 | % | — | % | (1.9 | %) | 2.2 | % | ||||||||||||||||||||||||||||||||||
Current year catastrophe losses | 86 | 128 | 60 | 1.6 | % | 2.5 | % | 1.2 | % | (0.9 | %) | 1.3 | % | ||||||||||||||||||||||||||||||||||
Aggregate losses and LAE and ratio | $ | 3,157 | $ | 3,271 | $ | 3,271 | 58.5 | % | 64.1 | % | 63.0 | % | (5.6 | %) | 1.1 | % |
Year ended December 31, | ||||||||||||||||||||||||||
Amount | Ratio | Change in Ratio | ||||||||||||||||||||||||
2019 | 2018 | 2017 | 2019 | 2018 | 2017 | 2019 - 2018 | 2018 - 2017 | |||||||||||||||||||
Property and transportation | ||||||||||||||||||||||||||
Current year, excluding catastrophe losses | $ | 1,332 | $ | 1,216 | $ | 1,176 | 72.8 | % | 70.3 | % | 68.7 | % | 2.5 | % | 1.6 | % | ||||||||||
Prior accident years development | (67 | ) | (50 | ) | (40 | ) | (3.6 | %) | (2.8 | %) | (2.3 | %) | (0.8 | %) | (0.5 | %) | ||||||||||
Current year catastrophe losses | 32 | 26 | 36 | 1.8 | % | 1.5 | % | 2.1 | % | 0.3 | % | (0.6 | %) | |||||||||||||
Property and transportation losses and LAE and ratio | $ | 1,297 | $ | 1,192 | $ | 1,172 | 71.0 | % | 69.0 | % | 68.5 | % | 2.0 | % | 0.5 | % | ||||||||||
Specialty casualty | ||||||||||||||||||||||||||
Current year, excluding catastrophe losses | $ | 1,657 | $ | 1,570 | $ | 1,425 | 63.8 | % | 65.4 | % | 65.2 | % | (1.6 | %) | 0.2 | % | ||||||||||
Prior accident years development | (88 | ) | (139 | ) | (86 | ) | (3.4 | %) | (5.8 | %) | (4.0 | %) | 2.4 | % | (1.8 | %) | ||||||||||
Current year catastrophe losses | 17 | 45 | 71 | 0.7 | % | 1.9 | % | 3.3 | % | (1.2 | %) | (1.4 | %) | |||||||||||||
Specialty casualty losses and LAE and ratio | $ | 1,586 | $ | 1,476 | $ | 1,410 | 61.1 | % | 61.5 | % | 64.5 | % | (0.4 | %) | (3.0 | %) | ||||||||||
Specialty financial | ||||||||||||||||||||||||||
Current year, excluding catastrophe losses | $ | 220 | $ | 223 | $ | 218 | 36.2 | % | 37.3 | % | 37.8 | % | (1.1 | %) | (0.5 | %) | ||||||||||
Prior accident years development | (38 | ) | (26 | ) | (21 | ) | (6.3 | %) | (4.4 | %) | (3.6 | %) | (1.9 | %) | (0.8 | %) | ||||||||||
Current year catastrophe losses | 10 | 28 | 30 | 1.6 | % | 4.7 | % | 5.2 | % | (3.1 | %) | (0.5 | %) | |||||||||||||
Specialty financial losses and LAE and ratio | $ | 192 | $ | 225 | $ | 227 | 31.5 | % | 37.6 | % | 39.4 | % | (6.1 | %) | (1.8 | %) | ||||||||||
Total Specialty | ||||||||||||||||||||||||||
Current year, excluding catastrophe losses | $ | 3,315 | $ | 3,092 | $ | 2,879 | 64.0 | % | 63.6 | % | 62.9 | % | 0.4 | % | 0.7 | % | ||||||||||
Prior accident years development | (187 | ) | (212 | ) | (139 | ) | (3.7 | %) | (4.4 | %) | (3.0 | %) | 0.7 | % | (1.4 | %) | ||||||||||
Current year catastrophe losses | 60 | 103 | 140 | 1.2 | % | 2.1 | % | 3.0 | % | (0.9 | %) | (0.9 | %) | |||||||||||||
Total Specialty losses and LAE and ratio | $ | 3,188 | $ | 2,983 | $ | 2,880 | 61.5 | % | 61.3 | % | 62.9 | % | 0.2 | % | (1.6 | %) | ||||||||||
Aggregate — including exited lines | ||||||||||||||||||||||||||
Current year, excluding catastrophe losses | $ | 3,354 | $ | 3,092 | $ | 2,879 | 64.0 | % | 63.6 | % | 62.9 | % | 0.4 | % | 0.7 | % | ||||||||||
Prior accident years development | (143 | ) | (192 | ) | (64 | ) | (2.2 | %) | (4.0 | %) | (1.4 | %) | 1.8 | % | (2.6 | %) | ||||||||||
Current year catastrophe losses | 60 | 103 | 140 | 1.2 | % | 2.1 | % | 3.0 | % | (0.9 | %) | (0.9 | %) | |||||||||||||
Aggregate losses and LAE and ratio | $ | 3,271 | $ | 3,003 | $ | 2,955 | 63.0 | % | 61.7 | % | 64.5 | % | 1.3 | % | (2.8 | %) |
Year ended December 31, | Change in % of NEP | ||||||||||||||||||||||||||||||||||||||||||||||
2021 | 2020 | 2019 | 2021 - 2020 | 2020 - 2019 | |||||||||||||||||||||||||||||||||||||||||||
U/W Exp | % of NEP | U/W Exp | % of NEP | U/W Exp | % of NEP | ||||||||||||||||||||||||||||||||||||||||||
Property and transportation | $ | 471 | 22.0 | % | $ | 482 | 25.8 | % | $ | 452 | 24.7 | % | (3.8 | %) | 1.1 | % | |||||||||||||||||||||||||||||||
Specialty casualty | 632 | 26.2 | % | 616 | 27.5 | % | 836 | 32.2 | % | (1.3 | %) | (4.7 | %) | ||||||||||||||||||||||||||||||||||
Specialty financial | 333 | 51.9 | % | 321 | 52.3 | % | 326 | 53.5 | % | (0.4 | %) | (1.2 | %) | ||||||||||||||||||||||||||||||||||
Other specialty | 78 | 37.2 | % | 68 | 38.5 | % | 58 | 37.9 | % | (1.3 | %) | 0.6 | % | ||||||||||||||||||||||||||||||||||
Total Specialty | 1,514 | 28.0 | % | 1,487 | 30.4 | % | 1,672 | 32.2 | % | (2.4 | %) | (1.8 | %) | ||||||||||||||||||||||||||||||||||
Neon exited lines | — | 117 | 30 | ||||||||||||||||||||||||||||||||||||||||||||
Total Aggregate | $ | 1,514 | 28.0 | % | $ | 1,604 | 31.4 | % | $ | 1,702 | 32.8 | % | (3.4 | %) | (1.4 | %) |
Year ended December 31, | Change in % of NEP | |||||||||||||||||||||||||
2019 | 2018 | 2017 | 2019 - 2018 | 2018 - 2017 | ||||||||||||||||||||||
U/W Exp | % of NEP | U/W Exp | % of NEP | U/W Exp | % of NEP | |||||||||||||||||||||
Property and transportation | $ | 452 | 24.7 | % | $ | 417 | 24.1 | % | $ | 385 | 22.5 | % | 0.6 | % | 1.6 | % | ||||||||||
Specialty casualty | 836 | 32.2 | % | 786 | 32.7 | % | 672 | 30.7 | % | (0.5 | %) | 2.0 | % | |||||||||||||
Specialty financial | 326 | 53.5 | % | 307 | 51.3 | % | 288 | 50.0 | % | 2.2 | % | 1.3 | % | |||||||||||||
Other specialty | 58 | 37.9 | % | 50 | 37.3 | % | 37 | 35.8 | % | 0.6 | % | 1.5 | % | |||||||||||||
Total Specialty | 1,672 | 32.2 | % | 1,560 | 32.1 | % | 1,382 | 30.2 | % | 0.1 | % | 1.9 | % | |||||||||||||
Neon exited lines charge | 30 | — | — | |||||||||||||||||||||||
Total Aggregate | $ | 1,702 | 32.8 | % | $ | 1,560 | 32.1 | % | $ | 1,382 | 30.2 | % | 0.7 | % | 1.9 | % |
Year ended December 31, | 2021 - 2020 | 2020 - 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year ended December 31, | 2019 - 2018 | 2018 - 2017 | 2021 | 2020 | 2019 | Change | % Change | Change | % Change | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2019 | 2018 | 2017 | Change | % Change | Change | % Change | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net investment income | $ | 472 | $ | 438 | $ | 362 | $ | 34 | 8 | % | $ | 76 | 21 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Net investment income: | Net investment income: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net investment income excluding alternative investments | Net investment income excluding alternative investments | $ | 323 | $ | 345 | $ | 398 | $ | (22) | (6 | %) | $ | (53) | (13 | %) | |||||||||||||||||||||||||||||||||||||||||||||||||||
Alternative investments | Alternative investments | 340 | 59 | 74 | 281 | 476 | % | (15) | (20 | %) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total net investment income | Total net investment income | $ | 663 | $ | 404 | $ | 472 | $ | 259 | 64 | % | $ | (68) | (14 | %) | |||||||||||||||||||||||||||||||||||||||||||||||||||
Average invested assets (at amortized cost) | $ | 11,348 | $ | 10,497 | $ | 9,948 | $ | 851 | 8 | % | $ | 549 | 6 | % | Average invested assets (at amortized cost) | $ | 12,944 | $ | 11,760 | $ | 11,348 | $ | 1,184 | 10 | % | $ | 412 | 4 | % | |||||||||||||||||||||||||||||||||||||
Yield (net investment income as a % of average invested assets) | 4.16 | % | 4.17 | % | 3.64 | % | (0.01 | %) | 0.53 | % | Yield (net investment income as a % of average invested assets) | 5.12 | % | 3.44 | % | 4.16 | % | 1.68 | % | (0.72 | %) | |||||||||||||||||||||||||||||||||||||||||||||
Tax equivalent yield (*) | 4.32 | % | 4.35 | % | 4.10 | % | (0.03 | %) | 0.25 | % | Tax equivalent yield (*) | 5.25 | % | 3.56 | % | 4.32 | % | 1.69 | % | (0.76 | %) |
Year ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Other income | |||||||||||
Income from the sale of real estate | $ | — | $ | — | $ | 16 | |||||
Other | 11 | 10 | 12 | ||||||||
Total other income | 11 | 10 | 28 | ||||||||
Other expenses | |||||||||||
Amortization of intangibles | 11 | 9 | 8 | ||||||||
Other | 35 | 32 | 33 | ||||||||
Total other expenses | 46 | 41 | 41 | ||||||||
Other income and expenses, net | $ | (35 | ) | $ | (31 | ) | $ | (13 | ) |
Year ended December 31, | % Change | ||||||||||||||||
2019 | 2018 | 2017 | 2019 - 2018 | 2018 - 2017 | |||||||||||||
Revenues: | |||||||||||||||||
Net investment income | $ | 1,792 | $ | 1,638 | $ | 1,458 | 9 | % | 12 | % | |||||||
Other income: | |||||||||||||||||
Guaranteed withdrawal benefit fees | 67 | 65 | 60 | 3 | % | 8 | % | ||||||||||
Policy charges and other miscellaneous income (a) | 40 | 42 | 43 | (5 | %) | (2 | %) | ||||||||||
Total revenues | 1,899 | 1,745 | 1,561 | 9 | % | 12 | % | ||||||||||
Costs and Expenses: | |||||||||||||||||
Annuity benefits (a)(b) | 1,140 | 998 | 892 | 14 | % | 12 | % | ||||||||||
Acquisition expenses (a) | 222 | 255 | 168 | (13 | %) | 52 | % | ||||||||||
Other expenses | 139 | 131 | 121 | 6 | % | 8 | % | ||||||||||
Total costs and expenses | 1,501 | 1,384 | 1,181 | 8 | % | 17 | % | ||||||||||
Core earnings before income taxes | 398 | 361 | 380 | 10 | % | (5 | %) | ||||||||||
Pretax non-core earnings (losses) (a) | (36 | ) | — | — | — | % | — | % | |||||||||
GAAP earnings before income taxes | $ | 362 | $ | 361 | $ | 380 | — | % | (5 | %) |
Year ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Other income: | |||||||||||||||||
Income from the sale of real estate | $ | 10 | $ | — | $ | — | |||||||||||
Other | 17 | 8 | 11 | ||||||||||||||
Total other income | 27 | 8 | 11 | ||||||||||||||
Other expenses: | |||||||||||||||||
Amortization of intangibles | 6 | 12 | 11 | ||||||||||||||
Interest expense on funds withheld | 25 | 24 | 24 | ||||||||||||||
Other | 2 | 6 | 11 | ||||||||||||||
Total other expenses | 33 | 42 | 46 | ||||||||||||||
Other income and expenses, net | $ | (6) | $ | (34) | $ | (35) |
Year ended December 31, | % Change | ||||||||||||||||
2019 | 2018 | 2017 | 2019 - 2018 | 2018 - 2017 | |||||||||||||
Earnings before income taxes — before the impact of unlocking, derivatives related to FIAs and other impacts of stock market performance and interest rates on FIAs | $ | 409 | $ | 409 | $ | 388 | — | % | 5 | % | |||||||
Unlocking | (1 | ) | (31 | ) | (3 | ) | (97 | %) | 933 | % | |||||||
Impact of derivatives related to FIAs and other impacts of changes in the stock market and interest rates on FIAs over or under option costs: | |||||||||||||||||
Change in fair value of derivatives related to FIAs | (294 | ) | (51 | ) | (70 | ) | 476 | % | (27 | %) | |||||||
Accretion of guaranteed minimum FIA benefits | (408 | ) | (347 | ) | (289 | ) | 18 | % | 20 | % | |||||||
Other annuity benefits | (14 | ) | (83 | ) | (58 | ) | (83 | %) | 43 | % | |||||||
Less cost of equity options | 586 | 506 | 395 | 16 | % | 28 | % | ||||||||||
Related impact on the amortization of deferred policy acquisition costs | 84 | (42 | ) | 17 | (300 | %) | (347 | %) | |||||||||
Earnings before income taxes | $ | 362 | $ | 361 | $ | 380 | — | % | (5 | %) |
Year ended December 31, | Total | |||||||||||||||||||||||||
2019 | 2018 | % Change | ||||||||||||||||||||||||
Core | Non-core | Total | Core | Non-core | Total | 2019 - 2018 | ||||||||||||||||||||
Interest credited — fixed | $ | 396 | $ | — | $ | 396 | $ | 357 | $ | — | $ | 357 | 11 | % | ||||||||||||
Accretion of guaranteed minimum FIA benefits | 99 | 309 | 408 | 347 | — | 347 | 18 | % | ||||||||||||||||||
Interest credited — fixed component of variable annuities | 4 | — | 4 | 5 | — | 5 | (20 | %) | ||||||||||||||||||
Cost of equity options | 445 | (445 | ) | — | — | — | — | — | % | |||||||||||||||||
Other annuity benefits: | ||||||||||||||||||||||||||
Amortization of sales inducements | 13 | — | 13 | 19 | — | 19 | (32 | %) | ||||||||||||||||||
Change in guaranteed withdrawal benefit reserve: | ||||||||||||||||||||||||||
Impact of change in the stock market and interest rates | (12 | ) | (12 | ) | (24 | ) | 32 | — | 32 | (175 | %) | |||||||||||||||
Accretion of benefits and other | 84 | — | 84 | 74 | — | 74 | 14 | % | ||||||||||||||||||
Change in expected death and annuitization reserves and other | 12 | — | 12 | 3 | — | 3 | 300 | % | ||||||||||||||||||
Change in other benefit reserves — impact of changes in interest rates and the stock market | 4 | 34 | 38 | 51 | — | 51 | (25 | %) | ||||||||||||||||||
Unlocking | — | (74 | ) | (74 | ) | 59 | — | 59 | (225 | %) | ||||||||||||||||
Derivatives related to fixed-indexed annuities: | ||||||||||||||||||||||||||
Embedded derivative mark-to-market | 462 | 638 | 1,100 | (248 | ) | — | (248 | ) | (544 | %) | ||||||||||||||||
Equity option mark-to-market | (367 | ) | (439 | ) | (806 | ) | 299 | — | 299 | (370 | %) | |||||||||||||||
Impact of derivatives related to FIAs | 95 | 199 | 294 | 51 | — | 51 | 476 | % | ||||||||||||||||||
Total annuity benefits | $ | 1,140 | $ | 11 | $ | 1,151 | $ | 998 | $ | — | $ | 998 | 15 | % |
Total | ||||||||||||||
Year ended December 31, 2017 | % Change | |||||||||||||
Core | Non-core | Total | 2018 - 2017 | |||||||||||
Interest credited — fixed | $ | 344 | $ | — | $ | 344 | 4 | % | ||||||
Accretion of guaranteed minimum FIA benefits | 289 | — | 289 | 20 | % | |||||||||
Interest credited — fixed component of variable annuities | 5 | — | 5 | — | % | |||||||||
Cost of equity options | — | — | — | — | % | |||||||||
Other annuity benefits: | ||||||||||||||
Amortization of sales inducements | 18 | — | 18 | 6 | % | |||||||||
Change in guaranteed withdrawal benefit reserve: | ||||||||||||||
Impact of change in the stock market and interest rates | (1 | ) | — | (1 | ) | (3,300 | %) | |||||||
Accretion of benefits and other | 68 | — | 68 | 9 | % | |||||||||
Change in expected death and annuitization reserves and other | 5 | — | 5 | (40 | %) | |||||||||
Change in other benefit reserves — impact of changes in interest rates and the stock market | 59 | — | 59 | (14 | %) | |||||||||
Unlocking | 35 | — | 35 | 69 | % | |||||||||
Derivatives related to fixed-indexed annuities: | ||||||||||||||
Embedded derivative mark-to-market | 564 | — | 564 | (144 | %) | |||||||||
Equity option mark-to-market | (494 | ) | — | (494 | ) | (161 | %) | |||||||
Impact of derivatives related to FIAs | 70 | — | 70 | (27 | %) | |||||||||
Total annuity benefits | $ | 892 | $ | — | $ | 892 | 12 | % |
Year ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Interest credited — fixed | $ | 396 | $ | 357 | $ | 344 | |||||
Include cost of equity options | 586 | 506 | 395 | ||||||||
Cost of funds | 982 | 863 | 739 | ||||||||
Interest credited — fixed component of variable annuities | 4 | 5 | 5 | ||||||||
Other annuity benefits, excluding the impact of interest rates and the stock market on FIAs | 109 | 96 | 91 | ||||||||
1,095 | 964 | 835 | |||||||||
Unlocking, changes in fair value of derivatives related to FIAs, and other impacts of the stock market and interest rates over or under option costs: | |||||||||||
Unlocking | (74 | ) | 59 | 35 | |||||||
Impact of derivatives related to FIAs | 294 | 51 | 70 | ||||||||
Accretion of guaranteed minimum FIA benefits | 408 | 347 | 289 | ||||||||
Other annuity benefits — impact of the stock market and interest rates on FIAs | 14 | 83 | 58 | ||||||||
Less cost of equity options (included in cost of funds) | (586 | ) | (506 | ) | (395 | ) | |||||
Total annuity benefits expense | $ | 1,151 | $ | 998 | $ | 892 |
Year ended December 31, | % Change | ||||||||||||||||
2019 | 2018 | 2017 | 2019 - 2018 | 2018 - 2017 | |||||||||||||
Average fixed annuity investments (at amortized cost) | $ | 38,216 | $ | 34,471 | $ | 31,250 | 11 | % | 10 | % | |||||||
Average fixed annuity benefits accumulated | 38,460 | 34,706 | 31,526 | 11 | % | 10 | % | ||||||||||
As % of fixed annuity benefits accumulated (except as noted): | |||||||||||||||||
Net investment income (as % of fixed annuity investments) | 4.67 | % | 4.73 | % | 4.63 | % | |||||||||||
Cost of funds | (2.55 | %) | (2.49 | %) | (2.34 | %) | |||||||||||
Other annuity benefit expenses, net of guaranteed withdrawal benefit fees (*) | (0.11 | %) | (0.10 | %) | (0.10 | %) | |||||||||||
Net interest spread | 2.01 | % | 2.14 | % | 2.19 | % | |||||||||||
Policy charges and other miscellaneous income (*) | 0.08 | % | 0.10 | % | 0.11 | % | |||||||||||
Acquisition expenses (*) | (0.66 | %) | (0.67 | %) | (0.68 | %) | |||||||||||
Other expenses | (0.35 | %) | (0.37 | %) | (0.37 | %) | |||||||||||
Net spread earned on fixed annuities excluding the impact of unlocking, changes in the fair value of derivatives related to FIAs and other impacts of changes in the stock market and interest rates on FIAs | 1.08 | % | 1.20 | % | 1.25 | % | |||||||||||
Changes in fair value of derivatives related to FIAs and other impacts of the stock market and interest rates under (over) options costs: | |||||||||||||||||
Included in core | (0.03 | %) | (0.04 | %) | (0.01 | %) | |||||||||||
Annuity non-core earnings (losses) | (0.09 | %) | — | % | — | % | |||||||||||
Unlocking | — | % | (0.09 | %) | (0.01 | %) | |||||||||||
Net spread earned on fixed annuities | 0.96 | % | 1.07 | % | 1.23 | % |
Year ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Cost of equity options (FIAs) | $ | 586 | $ | 506 | $ | 395 | |||||
Interest credited: | |||||||||||
Traditional fixed annuities | 244 | 234 | 238 | ||||||||
Fixed component of fixed-indexed annuities | 94 | 78 | 68 | ||||||||
Immediate annuities | 24 | 24 | 24 | ||||||||
Pension risk transfer products | 7 | 1 | — | ||||||||
Federal Home Loan Bank advances | 27 | 20 | 14 | ||||||||
Total cost of funds | $ | 982 | $ | 863 | $ | 739 |
Year ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Other annuity benefits, excluding the impact of the stock market and interest rates on FIAs: | |||||||||||
Amortization of sales inducements | $ | 13 | $ | 19 | $ | 18 | |||||
Change in guaranteed withdrawal benefit reserve | 84 | 74 | 68 | ||||||||
Change in other benefit reserves | 12 | 3 | 5 | ||||||||
Other annuity benefits | 109 | 96 | 91 | ||||||||
Offset guaranteed withdrawal benefit fees | (67 | ) | (65 | ) | (60 | ) | |||||
Other annuity benefits excluding the impact of the stock market and interest rates, net | 42 | 31 | 31 | ||||||||
Other annuity benefits — impact of the stock market and interest rates | 14 | 83 | 58 | ||||||||
Other annuity benefits, net | $ | 56 | $ | 114 | $ | 89 |
Year ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Annuity acquisition expenses before the impact of changes in the fair value of derivatives related to FIAs and other impacts of the stock market and interest rates | $ | 256 | $ | 242 | $ | 220 | |||||
Unlocking | 76 | (29 | ) | (35 | ) | ||||||
Impact of changes in the fair value of derivatives and other impacts of the stock market and interest rates: | |||||||||||
Included in core | (34 | ) | 42 | (17 | ) | ||||||
Annuity non-core earnings (losses) | (50 | ) | — | — | |||||||
Annuity acquisition expenses | $ | 248 | $ | 255 | $ | 168 |
Year ended December 31, | ||||||||
2019 | 2018 | 2017 | ||||||
Before unlocking, the impact of changes in the fair value of derivatives related to FIAs and other impacts of the stock market and interest rates | 0.66 | % | 0.67 | % | 0.68 | % | ||
Unlocking | 0.20 | % | (0.08 | %) | (0.11 | %) | ||
Impact of changes in fair value of derivatives and other impacts of the stock market and interest rates | (0.23 | %) | 0.12 | % | (0.06 | %) | ||
Annuity acquisition expenses as a % of fixed annuity benefits accumulated | 0.63 | % | 0.71 | % | 0.51 | % |
Year ended December 31, | % Change | ||||||||||||||||
2019 | 2018 | 2017 | 2019 - 2018 | 2018 - 2017 | |||||||||||||
Change in the fair value of derivatives related to FIAs | $ | (294 | ) | $ | (51 | ) | $ | (70 | ) | 476 | % | (27 | %) | ||||
Accretion of guaranteed minimum FIA benefits | (408 | ) | (347 | ) | (289 | ) | 18 | % | 20 | % | |||||||
Other annuity benefits | (14 | ) | (83 | ) | (58 | ) | (83 | %) | 43 | % | |||||||
Less cost of equity options | 586 | 506 | 395 | 16 | % | 28 | % | ||||||||||
Related impact on the amortization of DPAC | 84 | (42 | ) | 17 | (300 | %) | (347 | %) | |||||||||
Impact on annuity segment earnings before income taxes | $ | (46 | ) | $ | (17 | ) | $ | (5 | ) | 171 | % | 240 | % |
Year ended December 31, | % Change | ||||||||||||||||
2019 | 2018 | 2017 | 2019 - 2018 | 2018 - 2017 | |||||||||||||
Changes in the stock market, including volatility | $ | 68 | $ | (29 | ) | $ | 50 | (334 | %) | (158 | %) | ||||||
Changes in interest rates higher (lower) than expected | (117 | ) | 33 | (50 | ) | (455 | %) | (166 | %) | ||||||||
Other | 3 | (21 | ) | (5 | ) | (114 | %) | 320 | % | ||||||||
Impact on annuity segment earnings before income taxes | $ | (46 | ) | $ | (17 | ) | $ | (5 | ) | 171 | % | 240 | % |
Year ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Beginning fixed annuity reserves | $ | 36,431 | $ | 33,005 | $ | 29,647 | |||||
Fixed annuity premiums (receipts) | 4,939 | 5,382 | 4,313 | ||||||||
Federal Home Loan Bank advances and repayments | — | 225 | (64 | ) | |||||||
Surrenders, benefits and other withdrawals | (3,260 | ) | (2,836 | ) | (2,246 | ) | |||||
Interest and other annuity benefit expenses: | |||||||||||
Cost of funds | 982 | 863 | 739 | ||||||||
Embedded derivative mark-to-market | 1,100 | (248 | ) | 564 | |||||||
Change in other benefit reserves | (99 | ) | (19 | ) | 11 | ||||||
Unlocking | (75 | ) | 59 | 41 | |||||||
Ending fixed annuity reserves | $ | 40,018 | $ | 36,431 | $ | 33,005 | |||||
Reconciliation to annuity benefits accumulated per balance sheet: | |||||||||||
Ending fixed annuity reserves (from above) | $ | 40,018 | $ | 36,431 | $ | 33,005 | |||||
Impact of unrealized investment gains | 225 | 10 | 133 | ||||||||
Fixed component of variable annuities | 163 | 175 | 178 | ||||||||
Annuity benefits accumulated per balance sheet | $ | 40,406 | $ | 36,616 | $ | 33,316 |
Year ended December 31, | % Change | ||||||||||||||||
2019 | 2018 | 2017 | 2019 - 2018 | 2018 - 2017 | |||||||||||||
Financial institutions single premium annuities — indexed | $ | 1,537 | $ | 1,776 | $ | 1,711 | (13 | %) | 4 | % | |||||||
Financial institutions single premium annuities — fixed | 1,229 | 492 | 622 | 150 | % | (21 | %) | ||||||||||
Retail single premium annuities — indexed | 943 | 1,418 | 990 | (33 | %) | 43 | % | ||||||||||
Retail single premium annuities — fixed | 120 | 87 | 70 | 38 | % | 24 | % | ||||||||||
Broker dealer single premium annuities — indexed | 657 | 1,271 | 733 | (48 | %) | 73 | % | ||||||||||
Broker dealer single premium annuities — fixed | 32 | 14 | 7 | 129 | % | 100 | % | ||||||||||
Pension risk transfer | 257 | 132 | 6 | 95 | % | 2,100 | % | ||||||||||
Education market — fixed and indexed annuities | 164 | 192 | 174 | (15 | %) | 10 | % | ||||||||||
Total fixed annuity premiums | 4,939 | 5,382 | 4,313 | (8 | %) | 25 | % | ||||||||||
Variable annuities | 21 | 25 | 28 | (16 | %) | (11 | %) | ||||||||||
Total annuity premiums | $ | 4,960 | $ | 5,407 | $ | 4,341 | (8 | %) | 25 | % |
Year ended December 31, | ||||||||||||
2019 | 2018 | 2017 | ||||||||||
Policy charges and other miscellaneous income: | ||||||||||||
Unearned revenue | $ | 1 | $ | (1 | ) | $ | (3 | ) | ||||
Total revenues | 1 | (1 | ) | (3 | ) | |||||||
Annuity benefits: | ||||||||||||
Fixed-indexed annuities embedded derivative | (181 | ) | 44 | 25 | ||||||||
Guaranteed withdrawal benefit reserve | 102 | 10 | 13 | |||||||||
Other reserves | 4 | 5 | 3 | |||||||||
Sales inducements asset | 1 | — | (6 | ) | ||||||||
Total annuity benefits | (74 | ) | 59 | 35 | ||||||||
Annuity and supplemental insurance acquisition expenses: | ||||||||||||
Deferred policy acquisition costs | 76 | (29 | ) | (35 | ) | |||||||
Total costs and expenses | 2 | 30 | — | |||||||||
Net charge | $ | (1 | ) | $ | (31 | ) | $ | (3 | ) |
Year ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Earnings on fixed annuity benefits accumulated | $ | 367 | $ | 370 | $ | 387 | |||||
Earnings impact of investments in excess of fixed annuity benefits accumulated (*) | (10 | ) | (11 | ) | (13 | ) | |||||
Variable annuity earnings | 5 | 2 | 6 | ||||||||
Earnings before income taxes | $ | 362 | $ | 361 | $ | 380 |
Year ended December 31, | % Change | ||||||||||||||||||||||||||||
2021 | 2020 | 2019 | 2021 - 2020 | 2020 - 2019 | |||||||||||||||||||||||||
Revenues: | |||||||||||||||||||||||||||||
Net investment income | $ | 36 | $ | 12 | $ | 24 | 200 | % | (50 | %) | |||||||||||||||||||
Other income — P&C fees | 80 | 67 | 69 | 19 | % | (3 | %) | ||||||||||||||||||||||
Other income | 22 | 19 | 21 | 16 | % | (10 | %) | ||||||||||||||||||||||
Total revenues | 138 | 98 | 114 | 41 | % | (14 | %) | ||||||||||||||||||||||
Costs and Expenses: | |||||||||||||||||||||||||||||
Property and casualty insurance — commissions and other underwriting expenses | 33 | 21 | 23 | 57 | % | (9 | %) | ||||||||||||||||||||||
Other expense — expenses associated with P&C fees | 47 | 46 | 46 | 2 | % | — | % | ||||||||||||||||||||||
Other expenses (*) | 172 | 129 | 152 | 33 | % | (15 | %) | ||||||||||||||||||||||
Costs and expenses, excluding interest charges on borrowed money | 252 | 196 | 221 | 29 | % | (11 | %) | ||||||||||||||||||||||
Loss before income taxes, excluding realized gains and losses and interest charges on borrowed money | (114) | (98) | (107) | 16 | % | (8 | %) | ||||||||||||||||||||||
Interest charges on borrowed money | 94 | 88 | 68 | 7 | % | 29 | % | ||||||||||||||||||||||
Core loss from continuing operations before income taxes, excluding realized gains and losses | (208) | (186) | (175) | 12 | % | 6 | % | ||||||||||||||||||||||
Pretax non-core special A&E charges | — | (21) | (11) | (100 | %) | 91 | % | ||||||||||||||||||||||
Pretax non-core loss on retirement of debt | — | (5) | (5) | (100 | %) | — | % | ||||||||||||||||||||||
Pretax non-core loss on pension settlement | (11) | — | — | — | % | — | % | ||||||||||||||||||||||
GAAP loss from continuing operations before income taxes, excluding realized gains and losses | $ | (219) | $ | (212) | $ | (191) | 3 | % | 11 | % |
Year ended December 31, | % Change | ||||||||||||||||
2019 | 2018 | 2017 | 2019 - 2018 | 2018 - 2017 | |||||||||||||
Revenues: | |||||||||||||||||
Life, accident and health net earned premiums | $ | 22 | $ | 24 | $ | 22 | (8 | %) | 9 | % | |||||||
Net investment income | 43 | 25 | 34 | 72 | % | (26 | %) | ||||||||||
Other income — P&C fees | 69 | 69 | 66 | — | % | 5 | % | ||||||||||
Other income | 28 | 29 | 27 | (3 | %) | 7 | % | ||||||||||
Total revenues | 162 | 147 | 149 | 10 | % | (1 | %) | ||||||||||
Costs and Expenses: | |||||||||||||||||
Property and casualty insurance — commissions and other underwriting expenses | 23 | 23 | 25 | — | % | (8 | %) | ||||||||||
Life, accident and health benefits | 36 | 40 | 26 | (10 | %) | 54 | % | ||||||||||
Life, accident and health acquisition expenses | 5 | 6 | 5 | (17 | %) | 20 | % | ||||||||||
Other expense — expenses associated with P&C fees | 46 | 46 | 41 | — | % | 12 | % | ||||||||||
Other expenses (*) | 158 | 126 | 144 | 25 | % | (13 | %) | ||||||||||
Costs and expenses, excluding interest charges on borrowed money | 268 | 241 | 241 | 11 | % | — | % | ||||||||||
Core loss before income taxes, excluding realized gains and losses and interest charges on borrowed money | (106 | ) | (94 | ) | (92 | ) | 13 | % | 2 | % | |||||||
Interest charges on borrowed money | 68 | 62 | 85 | 10 | % | (27 | %) | ||||||||||
Core loss before income taxes, excluding realized gains and losses | (174 | ) | (156 | ) | (177 | ) | 12 | % | (12 | %) | |||||||
Pretax non-core special A&E charges | (11 | ) | (9 | ) | (24 | ) | 22 | % | (63 | %) | |||||||
Pretax non-core loss on retirement of debt | (5 | ) | — | (51 | ) | — | % | (100 | %) | ||||||||
GAAP loss before income taxes, excluding realized gains and losses | $ | (190 | ) | $ | (165 | ) | $ | (252 | ) | 15 | % | (35 | %) |
(*)Excludes |
December 31, 2021 | December 31, 2020 | December 31, 2019 | |||||||||||||||
Direct obligations of AFG: | |||||||||||||||||
4.50% Senior Notes due June 2047 | $ | 590 | $ | 590 | $ | 590 | |||||||||||
3.50% Senior Notes due August 2026 | 425 | 425 | 425 | ||||||||||||||
5.25% Senior Notes due April 2030 | 300 | 300 | — | ||||||||||||||
5.125% Subordinated Debentures due December 2059 | 200 | 200 | 200 | ||||||||||||||
4.50% Subordinated Debentures due September 2060 | 200 | 200 | — | ||||||||||||||
6% Subordinated Debentures due November 2055 | — | — | 150 | ||||||||||||||
5.625% Subordinated Debentures due June 2060 | 150 | 150 | — | ||||||||||||||
5.875% Subordinated Debentures due March 2059 | 125 | 125 | 125 | ||||||||||||||
Other | 3 | 3 | 3 | ||||||||||||||
Total principal amount of Holding Company Debt | $ | 1,993 | $ | 1,993 | $ | 1,493 | |||||||||||
Weighted Average Interest Rate | 4.6 | % | 4.6 | % | 4.6 | % |
December 31, 2019 | December 31, 2018 | January 1, 2017 | |||||||||
Direct obligations of AFG: | |||||||||||
4.50% Senior Notes due June 2047 | $ | 590 | $ | 590 | $ | — | |||||
3.50% Senior Notes due August 2026 | 425 | 425 | 300 | ||||||||
9-7/8% Senior Notes due June 2019 | — | — | 350 | ||||||||
6-3/8% Senior Notes due June 2042 | — | — | 230 | ||||||||
5-3/4% Senior Notes due August 2042 | — | — | 125 | ||||||||
5.125% Subordinated Debentures due December 2059 | 200 | — | — | ||||||||
6% Subordinated Debentures due November 2055 | 150 | 150 | 150 | ||||||||
5.875% Subordinated Debentures due March 2059 | 125 | — | — | ||||||||
6-1/4% Subordinated Debentures due September 2054 | — | 150 | 150 | ||||||||
Other | 3 | 3 | 3 | ||||||||
Total principal amount of Holding Company Debt | $ | 1,493 | $ | 1,318 | $ | 1,308 | |||||
Weighted Average Interest Rate | 4.6 | % | 4.6 | % | 6.5 | % |
Year ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Realized gains (losses) before impairments: | |||||||||||
Disposals | $ | 19 | $ | 9 | $ | 87 | |||||
Change in the fair value of equity securities (*) | 278 | (262 | ) | — | |||||||
Change in the fair value of derivatives | 9 | (5 | ) | (6 | ) | ||||||
Adjustments to annuity deferred policy acquisition costs and related items | — | 11 | (3 | ) | |||||||
306 | (247 | ) | 78 | ||||||||
Impairment charges: | |||||||||||
Securities | (29 | ) | (26 | ) | (88 | ) | |||||
Adjustments to annuity deferred policy acquisition costs and related items | 10 | 7 | 15 | ||||||||
(19 | ) | (19 | ) | (73 | ) | ||||||
Realized gains (losses) on securities | $ | 287 | $ | (266 | ) | $ | 5 |
Year ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Realized gains (losses) before impairments: | |||||||||||||||||
Disposals | $ | 5 | $ | 8 | $ | 4 | |||||||||||
Change in the fair value of equity securities | 110 | (69) | 155 | ||||||||||||||
Change in the fair value of derivatives | (6) | (1) | 4 | ||||||||||||||
109 | (62) | 163 | |||||||||||||||
Change in allowance and impairments on securities | 1 | (13) | (8) | ||||||||||||||
Realized gains (losses) on securities | $ | 110 | $ | (75) | $ | 155 |
Year ended December 31, | % Change | ||||||||||||||||
2019 | 2018 | 2017 | 2019 - 2018 | 2018 - 2017 | |||||||||||||
Neon | $ | (28 | ) | $ | (13 | ) | $ | — | 115 | % | — | % | |||||
Other | — | — | 2 | — | % | (100 | %) | ||||||||||
Earnings (losses) attributable to noncontrolling interests | $ | (28 | ) | $ | (13 | ) | $ | 2 | 115 | % | (750 | %) |
Year ended December 31, | % Change | ||||||||||||||||||||||||||||
2021 (*) | 2020 | 2019 | 2021 - 2020 | 2020 - 2019 | |||||||||||||||||||||||||
Pretax annuity earnings historically reported as core operating earnings: | |||||||||||||||||||||||||||||
Pretax annuity earnings before items below | $ | 106 | $ | 325 | $ | 311 | (67 | %) | 5 | % | |||||||||||||||||||
Earnings on partnerships and similar investments | 139 | 15 | 77 | 827 | % | (81 | %) | ||||||||||||||||||||||
Total pretax annuity earnings historically reported as core operating earnings | 245 | 340 | 388 | (28 | %) | (12 | %) | ||||||||||||||||||||||
Pretax amounts previously reported outside of annuity core earnings: | |||||||||||||||||||||||||||||
Unlocking | — | (46) | (1) | (100 | %) | 4,500 | % | ||||||||||||||||||||||
Impact of reinsurance, derivatives related to FIAs and other impacts of changes in the stock market and interest rates on FIAs over or under option costs | (33) | (142) | (46) | (77 | %) | 209 | % | ||||||||||||||||||||||
Realized gains on securities | 112 | 365 | 132 | (69 | %) | 177 | % | ||||||||||||||||||||||
Run-off life and long-term care | — | (8) | 1 | (100 | %) | (900 | %) | ||||||||||||||||||||||
Total pretax amounts previously reported outside of annuity core earnings | 79 | 169 | 86 | (53 | %) | 97 | % | ||||||||||||||||||||||
GAAP pretax earnings from discontinued annuity operations, excluding the gain on the sale of the discontinued annuity operations | 324 | 509 | 474 | (36 | %) | 7 | % | ||||||||||||||||||||||
Provision for income taxes | 66 | 102 | 96 | (35 | %) | 6 | % | ||||||||||||||||||||||
GAAP net earnings from discontinued annuity operations, excluding the sale of the discontinued annuity operations | 258 | 407 | 378 | (37 | %) | 8 | % | ||||||||||||||||||||||
Gain on sale of discontinued annuity operations, net of tax | 656 | — | — | — | % | — | % | ||||||||||||||||||||||
GAAP net earnings from discontinued annuity operations | $ | 914 | $ | 407 | $ | 378 | 125 | % | 8 | % |
2021 | 2020 | ||||||||||
Fair value of fixed maturity portfolio | $ | 10,385 | $ | 9,108 | |||||||
Percentage impact on fair value of 100 bps increase in interest rates | (2.0 | %) | (3.0 | %) | |||||||
Pretax impact on fair value of fixed maturity portfolio | $ | (208) | $ | (273) |
2019 | 2018 | |||||||
Fair value of fixed maturity portfolio | $ | 46,618 | $ | 42,102 | ||||
Percentage impact on fair value of 100 bps increase in interest rates | (4.0 | %) | (4.5 | %) | ||||
Pretax impact on fair value of fixed maturity portfolio | $ | (1,865 | ) | $ | (1,895 | ) | ||
Offsetting adjustments to deferred policy acquisition costs and other balance sheet amounts | 850 | 800 | ||||||
Estimated pretax impact on accumulated other comprehensive income | (1,015 | ) | (1,095 | ) | ||||
Deferred income tax | 213 | 230 | ||||||
Estimated after-tax impact on accumulated other comprehensive income | $ | (802 | ) | $ | (865 | ) |
First | Second | Third | Fourth | Fifth | Thereafter | Total | Fair Value (*) | |||||||||||||||||||||||||
2019 | $ | 3,546 | $ | 4,185 | $ | 4,634 | $ | 5,196 | $ | 5,839 | $ | 22,051 | $ | 45,451 | $ | 40,182 | ||||||||||||||||
2018 | 3,493 | 3,989 | 4,609 | 4,701 | 4,640 | 22,156 | 43,588 | 34,765 |
December 31, 2021 | December 31, 2020 | |||||||||||||||||||||||||||||||
Scheduled Principal Payments | Rate | Scheduled Principal Payments | Rate | |||||||||||||||||||||||||||||
2022 | $ | — | — | % | 2021 | $ | — | — | % | |||||||||||||||||||||||
2023 | — | — | % | 2022 | — | — | % | |||||||||||||||||||||||||
2024 | — | — | % | 2023 | — | — | % | |||||||||||||||||||||||||
2025 | — | — | % | 2024 | — | — | % | |||||||||||||||||||||||||
2026 | 425 | 3.5 | % | 2025 | — | — | % | |||||||||||||||||||||||||
Thereafter | 1,568 | 4.9 | % | Thereafter | 1,993 | 4.6 | % | |||||||||||||||||||||||||
Total | $ | 1,993 | 4.6 | % | Total | $ | 1,993 | 4.6 | % | |||||||||||||||||||||||
Fair Value | $ | 2,261 | Fair Value | $ | 2,325 |
December 31, 2019 | December 31, 2018 | |||||||||||||||||
Scheduled Principal Payments | Rate | Scheduled Principal Payments | Rate | |||||||||||||||
2020 | $ | — | — | % | 2019 | $ | — | — | % | |||||||||
2021 | — | — | % | 2020 | — | — | % | |||||||||||
2022 | — | — | % | 2021 | — | — | % | |||||||||||
2023 | — | — | % | 2022 | — | — | % | |||||||||||
2024 | — | — | % | 2023 | — | — | % | |||||||||||
Thereafter | 1,493 | 4.6 | % | Thereafter | 1,318 | 4.6 | % | |||||||||||
Total | $ | 1,493 | 4.6 | % | Total | $ | 1,318 | 4.6 | % | |||||||||
Fair Value | $ | 1,622 | Fair Value | $ | 1,231 |
Page | |||||
Report of Independent Registered Public Accounting Firm (PCAOB ID: 42) | |||||
Consolidated Balance Sheet as of December 31, | |||||
Consolidated Statement of Earnings for the years ended December 31, | |||||
Consolidated Statement of Comprehensive Income for the years ended December 31, | |||||
Consolidated Statement of Changes in Equity for the years ended December 31, | |||||
Consolidated Statement of Cash Flows for the years ended December 31, | |||||
Notes to Consolidated Financial Statements |
/s/ ERNST & YOUNG LLP | ||||||||
Cincinnati, Ohio | ||||||||
February 25, |
Valuation of investments in securities | ||||||||
Description of the Matter | As of December 31, Auditing the fair value of the fixed-income and equity securities that use unobservable inputs was complex and highly judgmental due to the judgment used by the Company in determining unobservable inputs and assumptions to estimate the securities’ fair value. Significant unobservable inputs and assumptions include |
How We Addressed the Matter in Our Audit | We obtained an understanding, evaluated the design, and tested the operating effectiveness of controls over management’s valuation process for the fixed-income and equity securities priced using unobservable inputs. This included, among others, testing controls over investment pricing and the development and review of significant inputs and assumptions used in determining the fair values. To test the Company’s investment fair values, our audit procedures included, among others, comparing the fair values for a sample of securities to pricing service values or internally developed cash flow models. With the assistance of our valuation specialists, we evaluated the valuation methodologies used by the Company and compared the Company’s fair value estimate to an independently calculated range of fair value estimates for a sample of securities. We evaluated information that corroborated or contradicted the Company’s fair value estimates, including observable |
Property and casualty unpaid losses and loss adjustment expenses | ||||||||
Description of the Matter | As of December 31, Auditing management’s best estimate of reserves was complex because it required the involvement of our actuarial specialists due to the highly judgmental nature of the assumptions used in the evaluation process. The significant judgment was primarily due to the sensitivity of management’s best estimate to the selection and weighting of actuarial methods, loss development factors, expected loss ratios, and estimated inflation. These assumptions have a significant effect on the valuation of reserves. |
How We Addressed the Matter in Our Audit | We obtained an understanding, evaluated the design and tested the operating effectiveness of controls over the process for estimating reserves. This included, among others, the review and approval processes that management has in place for the methods and assumptions used in estimating the reserves. With the assistance of actuarial specialists, our audit procedures included, among others, an evaluation of the Company’s selection and weighting of actuarial methods used, |
Auditing management’s estimate of the amortization of annuity deferred policy acquisition costs was complex because it required the involvement of our actuarial specialists due to the highly judgmental nature of the assumptions used in management’s projection of estimated gross profits, which are used in the amortization of annuity deferred policy acquisition costs. The significant judgment was primarily due to the sensitivity of the estimated gross profits to the expected investment yield and lapse rate assumptions. |
To test the amortization of deferred policy acquisition costs related to annuity contracts, our audit procedures included, among others, testing the completeness and accuracy of the data used to calculate the estimated gross profits through testing the reconciliation of the underlying data recorded in the source systems to the actuarial valuation models. With the assistance of our actuarial specialists, we evaluated the assumptions used by management in determining estimated gross profits with those used in prior periods. Also, with the assistance of our actuarial specialists, we compared significant assumptions, including expected investment yields and lapse rates, to prior actual experience and observable market data, and we evaluated management’s estimates of prospective changes in these assumptions. In addition, we performed an independent calculation of estimated and actual gross profits for a sample of product cohorts for comparison with the actuarial model used by management. |
Auditing management’s estimate of the fair value of the embedded derivatives related to fixed-indexed annuity products was complex because it required the involvement of our actuarial specialists due to the highly judgmental nature of the assumptions used in the valuation process. The significant judgment was primarily due to the sensitivity of the budgeted option costs and lapse assumptions. |
To test the embedded derivatives related to fixed-indexed annuity products, our procedures included, among others, testing the completeness and accuracy of data used in the valuation process through testing the reconciliation of the underlying data recorded in the source systems to the actuarial valuation models. With the assistance of our actuarial specialists, we evaluated the methods and assumptions used by management in determining the estimated fair value of the embedded derivatives. We compared the significant assumptions, including expected budget option costs and lapses, to prior actual experience and management’s estimates of prospective changes in these assumptions. In addition, we performed an independent calculation of the embedded derivatives for a sample of policies for comparison with the fair value calculated by the actuarial model used by management. |
/s/ ERNST & YOUNG LLP | ||||||||
We have served as the Company’s auditor since 1961. | ||||||||
Cincinnati, Ohio | ||||||||
February 25, |
December 31, | |||||||||||
2021 | 2020 | ||||||||||
Assets: | |||||||||||
Cash and cash equivalents | $ | 2,131 | $ | 1,665 | |||||||
Investments: | |||||||||||
Fixed maturities, available for sale at fair value (amortized cost — $10,193 and $8,812; allowance for expected credit losses of $9 and $12) | 10,357 | 9,084 | |||||||||
Fixed maturities, trading at fair value | 28 | 24 | |||||||||
Equity securities, at fair value | 1,042 | 889 | |||||||||
Investments accounted for using the equity method | 1,517 | 1,235 | |||||||||
Mortgage loans | 520 | 377 | |||||||||
Real estate and other investments | 150 | 220 | |||||||||
Total cash and investments | 15,745 | 13,494 | |||||||||
Recoverables from reinsurers | 3,519 | 3,288 | |||||||||
Prepaid reinsurance premiums | 834 | 768 | |||||||||
Agents’ balances and premiums receivable | 1,265 | 1,229 | |||||||||
Deferred policy acquisition costs | 267 | 244 | |||||||||
Assets of managed investment entities | 5,296 | 4,971 | |||||||||
Other receivables | 857 | 678 | |||||||||
Other assets | 902 | 977 | |||||||||
Goodwill | 246 | 176 | |||||||||
Assets of discontinued annuity operations | — | 47,885 | |||||||||
Total assets | $ | 28,931 | $ | 73,710 | |||||||
Liabilities and Equity: | |||||||||||
Unpaid losses and loss adjustment expenses | $ | 11,074 | $ | 10,392 | |||||||
Unearned premiums | 3,041 | 2,803 | |||||||||
Payable to reinsurers | 920 | 807 | |||||||||
Liabilities of managed investment entities | 5,220 | 4,914 | |||||||||
Long-term debt | 1,964 | 1,963 | |||||||||
Other liabilities | 1,700 | 1,584 | |||||||||
Liabilities of discontinued annuity operations | — | 44,458 | |||||||||
Total liabilities | 23,919 | 66,921 | |||||||||
Shareholders’ equity: | |||||||||||
Common Stock, no par value — 200,000,000 shares authorized — 84,920,965 and 86,345,246 shares outstanding | 85 | 86 | |||||||||
Capital surplus | 1,330 | 1,281 | |||||||||
Retained earnings | 3,478 | 4,149 | |||||||||
Accumulated other comprehensive income, net of tax | 119 | 1,273 | |||||||||
Total shareholders’ equity | 5,012 | 6,789 | |||||||||
Total liabilities and shareholders’ equity | $ | 28,931 | $ | 73,710 |
December 31, | |||||||
2019 | 2018 | ||||||
Assets: | |||||||
Cash and cash equivalents | $ | 2,314 | $ | 1,515 | |||
Investments: | |||||||
Fixed maturities, available for sale at fair value (amortized cost — $44,524 and $41,837) | 46,505 | 41,997 | |||||
Fixed maturities, trading at fair value | 113 | 105 | |||||
Equity securities, at fair value | 1,937 | 1,814 | |||||
Investments accounted for using the equity method | 1,688 | 1,374 | |||||
Mortgage loans | 1,329 | 1,068 | |||||
Policy loans | 164 | 174 | |||||
Equity index call options | 924 | 184 | |||||
Real estate and other investments | 278 | 267 | |||||
Total cash and investments | 55,252 | 48,498 | |||||
Recoverables from reinsurers | 3,415 | 3,349 | |||||
Prepaid reinsurance premiums | 678 | 610 | |||||
Agents’ balances and premiums receivable | 1,335 | 1,234 | |||||
Deferred policy acquisition costs | 1,037 | 1,682 | |||||
Assets of managed investment entities | 4,736 | 4,700 | |||||
Other receivables | 975 | 1,090 | |||||
Variable annuity assets (separate accounts) | 628 | 557 | |||||
Other assets | 1,867 | 1,529 | |||||
Goodwill | 207 | 207 | |||||
Total assets | $ | 70,130 | $ | 63,456 | |||
Liabilities and Equity: | |||||||
Unpaid losses and loss adjustment expenses | $ | 10,232 | $ | 9,741 | |||
Unearned premiums | 2,830 | 2,595 | |||||
Annuity benefits accumulated | 40,406 | 36,616 | |||||
Life, accident and health reserves | 612 | 635 | |||||
Payable to reinsurers | 814 | 752 | |||||
Liabilities of managed investment entities | 4,571 | 4,512 | |||||
Long-term debt | 1,473 | 1,302 | |||||
Variable annuity liabilities (separate accounts) | 628 | 557 | |||||
Other liabilities | 2,295 | 1,774 | |||||
Total liabilities | 63,861 | 58,484 | |||||
Redeemable noncontrolling interests | — | — | |||||
Shareholders’ equity: | |||||||
Common Stock, no par value — 200,000,000 shares authorized — 90,303,686 and 89,291,724 shares outstanding | 90 | 89 | |||||
Capital surplus | 1,307 | 1,245 | |||||
Retained earnings | 4,009 | 3,588 | |||||
Accumulated other comprehensive income, net of tax | 863 | 48 | |||||
Total shareholders’ equity | 6,269 | 4,970 | |||||
Noncontrolling interests | — | 2 | |||||
Total equity | 6,269 | 4,972 | |||||
Total liabilities and equity | $ | 70,130 | $ | 63,456 |
Year ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Revenues: | |||||||||||||||||
Property and casualty insurance net earned premiums | $ | 5,404 | $ | 5,099 | $ | 5,185 | |||||||||||
Net investment income | 730 | 461 | 532 | ||||||||||||||
Realized gains (losses) on: | |||||||||||||||||
Securities | 110 | (75) | 155 | ||||||||||||||
Subsidiaries | 4 | 23 | — | ||||||||||||||
Income of managed investment entities: | |||||||||||||||||
Investment income | 181 | 201 | 269 | ||||||||||||||
Gain (loss) on change in fair value of assets/liabilities | 10 | (20) | (14) | ||||||||||||||
Other income | 113 | 80 | 86 | ||||||||||||||
Total revenues | 6,552 | 5,769 | 6,213 | ||||||||||||||
Costs and Expenses: | |||||||||||||||||
Property and casualty insurance: | |||||||||||||||||
Losses and loss adjustment expenses | 3,157 | 3,271 | 3,271 | ||||||||||||||
Commissions and other underwriting expenses | 1,547 | 1,625 | 1,725 | ||||||||||||||
Interest charges on borrowed money | 94 | 88 | 68 | ||||||||||||||
Expenses of managed investment entities | 155 | 167 | 239 | ||||||||||||||
Other expenses | 264 | 279 | 276 | ||||||||||||||
Total costs and expenses | 5,217 | 5,430 | 5,579 | ||||||||||||||
Earnings from continuing operations before income taxes | 1,335 | 339 | 634 | ||||||||||||||
Provision for income taxes | 254 | 25 | 143 | ||||||||||||||
Net earnings from continuing operations, including noncontrolling interests | 1,081 | 314 | 491 | ||||||||||||||
Net earnings from discontinued operations | 914 | 407 | 378 | ||||||||||||||
Net earnings, including noncontrolling interests | 1,995 | 721 | 869 | ||||||||||||||
Less: Net earnings (loss) from continuing operations attributable to noncontrolling interests | — | (11) | (28) | ||||||||||||||
Net Earnings Attributable to Shareholders | $ | 1,995 | $ | 732 | $ | 897 | |||||||||||
Earnings Attributable to Shareholders per Basic Common Share from: | |||||||||||||||||
Continuing operations | $ | 12.70 | $ | 3.66 | $ | 5.77 | |||||||||||
Discontinued operations | 10.74 | 4.59 | 4.21 | ||||||||||||||
Total basic earnings attributable to shareholders | $ | 23.44 | $ | 8.25 | $ | 9.98 | |||||||||||
Earnings Attributable to Shareholders per Diluted Common Share: | |||||||||||||||||
Continuing operations | $ | 12.62 | $ | 3.63 | $ | 5.70 | |||||||||||
Discontinued operations | 10.68 | 4.57 | 4.15 | ||||||||||||||
Total diluted earnings attributable to shareholders | $ | 23.30 | $ | 8.20 | $ | 9.85 | |||||||||||
Average number of Common Shares: | |||||||||||||||||
Basic | 85.1 | 88.7 | 89.9 | ||||||||||||||
Diluted | 85.6 | 89.2 | 91.0 |
Year ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Revenues: | |||||||||||
Property and casualty insurance net earned premiums | $ | 5,185 | $ | 4,865 | $ | 4,579 | |||||
Life, accident and health net earned premiums | 22 | 24 | 22 | ||||||||
Net investment income | 2,303 | 2,094 | 1,831 | ||||||||
Realized gains (losses) on securities (*) | 287 | (266 | ) | 5 | |||||||
Income (loss) of managed investment entities: | |||||||||||
Investment income | 269 | 255 | 210 | ||||||||
Gain (loss) on change in fair value of assets/liabilities | (30 | ) | (21 | ) | 12 | ||||||
Other income | 201 | 199 | 206 | ||||||||
Total revenues | 8,237 | 7,150 | 6,865 | ||||||||
Costs and Expenses: | |||||||||||
Property and casualty insurance: | |||||||||||
Losses and loss adjustment expenses | 3,271 | 3,003 | 2,955 | ||||||||
Commissions and other underwriting expenses | 1,725 | 1,583 | 1,407 | ||||||||
Annuity benefits | 1,151 | 998 | 892 | ||||||||
Life, accident and health benefits | 36 | 40 | 26 | ||||||||
Annuity and supplemental insurance acquisition expenses | 253 | 261 | 173 | ||||||||
Interest charges on borrowed money | 68 | 62 | 85 | ||||||||
Expenses of managed investment entities | 220 | 211 | 181 | ||||||||
Other expenses | 405 | 353 | 422 | ||||||||
Total costs and expenses | 7,129 | 6,511 | 6,141 | ||||||||
Earnings before income taxes | 1,108 | 639 | 724 | ||||||||
Provision for income taxes | 239 | 122 | 247 | ||||||||
Net earnings, including noncontrolling interests | 869 | 517 | 477 | ||||||||
Less: Net earnings (losses) attributable to noncontrolling interests | (28 | ) | (13 | ) | 2 | ||||||
Net Earnings Attributable to Shareholders | $ | 897 | $ | 530 | $ | 475 | |||||
Earnings Attributable to Shareholders per Common Share: | |||||||||||
Basic | $ | 9.98 | $ | 5.95 | $ | 5.40 | |||||
Diluted | $ | 9.85 | $ | 5.85 | $ | 5.28 | |||||
Average number of Common Shares: | |||||||||||
Basic | 89.9 | 89.0 | 87.8 | ||||||||
Diluted | 91.0 | 90.6 | 89.8 | ||||||||
________________________________________ | |||||||||||
(*) Consists of the following: | |||||||||||
Realized gains (losses) before impairments | $ | 306 | $ | (247 | ) | $ | 78 | ||||
Losses on securities with impairment | (19 | ) | (19 | ) | (74 | ) | |||||
Non-credit portion recognized in other comprehensive income (loss) | — | — | 1 | ||||||||
Impairment charges recognized in earnings | (19 | ) | (19 | ) | (73 | ) | |||||
Total realized gains (losses) on securities | $ | 287 | $ | (266 | ) | $ | 5 |
Year ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Net earnings, including noncontrolling interests | $ | 1,995 | $ | 721 | $ | 869 | |||||||||||
Other comprehensive income (loss), net of tax: | |||||||||||||||||
Net unrealized gains (losses) on securities: | |||||||||||||||||
Unrealized holding gains (losses) on securities arising during the period | (218) | 700 | 788 | ||||||||||||||
Reclassification adjustment for realized (gains) losses included in net earnings | (17) | (307) | (9) | ||||||||||||||
Reclassification adjustment for unrealized gains of subsidiaries sold | (884) | — | — | ||||||||||||||
Total net unrealized gains (losses) on securities | (1,119) | 393 | 779 | ||||||||||||||
Net unrealized gains (losses) on cash flow hedges: | |||||||||||||||||
Unrealized holding gains (losses) on cash flow hedges arising during the period | (1) | 56 | 31 | ||||||||||||||
Reclassification adjustment for investment income included in net earnings | (11) | (32) | (3) | ||||||||||||||
Reclassification adjustment for unrealized gains on cash flow hedges of subsidiaries sold | (29) | — | — | ||||||||||||||
Total net unrealized gains (losses) on cash flow hedges | (41) | 24 | 28 | ||||||||||||||
Foreign currency translation adjustments | (2) | (1) | 7 | ||||||||||||||
Pension and other postretirement plans adjustments (“OPRP”): | |||||||||||||||||
Unrealized holding losses on pension and OPRP arising during the period | (1) | (1) | — | ||||||||||||||
Reclassification adjustment for pension settlement loss included in net earnings | 9 | 1 | 1 | ||||||||||||||
Total pension and OPRP adjustments | 8 | — | 1 | ||||||||||||||
Other comprehensive income (loss), net of tax | (1,154) | 416 | 815 | ||||||||||||||
Total comprehensive income, net of tax | 841 | 1,137 | 1,684 | ||||||||||||||
Less: Comprehensive income (loss) attributable to noncontrolling interests | — | (9) | (28) | ||||||||||||||
Comprehensive income attributable to shareholders | $ | 841 | $ | 1,146 | $ | 1,712 |
Year ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Net earnings, including noncontrolling interests | $ | 869 | $ | 517 | $ | 477 | |||||
Other comprehensive income (loss), net of tax: | |||||||||||
Net unrealized gains (losses) on securities: | |||||||||||
Unrealized holding gains (losses) on securities arising during the period | 788 | (544 | ) | 297 | |||||||
Reclassification adjustment for realized (gains) losses included in net earnings | (9 | ) | 8 | (10 | ) | ||||||
Total net unrealized gains (losses) on securities | 779 | (536 | ) | 287 | |||||||
Net unrealized gains (losses) on cash flow hedges | 28 | 2 | (4 | ) | |||||||
Foreign currency translation adjustments | 7 | (10 | ) | 12 | |||||||
Pension and other postretirement plans adjustments | 1 | — | 1 | ||||||||
Other comprehensive income (loss), net of tax | 815 | (544 | ) | 296 | |||||||
Total comprehensive income (loss), net of tax | 1,684 | (27 | ) | 773 | |||||||
Less: Comprehensive income (loss) attributable to noncontrolling interests | (28 | ) | (13 | ) | 2 | ||||||
Comprehensive income (loss) attributable to shareholders | $ | 1,712 | $ | (14 | ) | $ | 771 |
Shareholders’ Equity | Redeemable | |||||||||||||||||||||||||||||||||||||||||||||||||
Common | Common Stock and Capital | Retained | Accumulated Other Comp. | Noncon- trolling | Total | Noncon- trolling | ||||||||||||||||||||||||||||||||||||||||||||
Shares | Surplus | Earnings | Inc. (Loss) | Total | Interests | Equity | Interests | |||||||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2018 | 89,291,724 | $ | 1,334 | $ | 3,588 | $ | 48 | $ | 4,970 | $ | 2 | $ | 4,972 | $ | — | |||||||||||||||||||||||||||||||||||
Net earnings (loss) | — | — | 897 | — | 897 | (2) | 895 | (26) | ||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income | — | — | — | 815 | 815 | — | 815 | — | ||||||||||||||||||||||||||||||||||||||||||
Dividends ($4.95 per share) | — | — | (446) | — | (446) | — | (446) | — | ||||||||||||||||||||||||||||||||||||||||||
Shares issued: | ||||||||||||||||||||||||||||||||||||||||||||||||||
Exercise of stock options | 747,167 | 31 | — | — | 31 | — | 31 | — | ||||||||||||||||||||||||||||||||||||||||||
Restricted stock awards | 232,635 | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
Other benefit plans | 77,429 | 8 | — | — | 8 | — | 8 | — | ||||||||||||||||||||||||||||||||||||||||||
Dividend reinvestment plan | 19,334 | 2 | — | — | 2 | — | 2 | — | ||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation expense | — | 23 | — | — | 23 | — | 23 | — | ||||||||||||||||||||||||||||||||||||||||||
Shares exchanged — benefit plans | (50,062) | (1) | (4) | — | (5) | — | (5) | — | ||||||||||||||||||||||||||||||||||||||||||
Forfeitures of restricted stock | (14,541) | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
Other | — | — | (26) | — | (26) | — | (26) | 26 | ||||||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2019 | 90,303,686 | $ | 1,397 | $ | 4,009 | $ | 863 | $ | 6,269 | $ | — | $ | 6,269 | $ | — | |||||||||||||||||||||||||||||||||||
Cumulative effect of accounting change | — | — | 7 | — | 7 | — | 7 | — | ||||||||||||||||||||||||||||||||||||||||||
Net earnings (loss) | — | — | 732 | — | 732 | 2 | 734 | (13) | ||||||||||||||||||||||||||||||||||||||||||
Other comprehensive income | — | — | — | 414 | 414 | — | 414 | 2 | ||||||||||||||||||||||||||||||||||||||||||
Dividends ($3.85 per share) | — | — | (336) | — | (336) | — | (336) | — | ||||||||||||||||||||||||||||||||||||||||||
Shares issued: | ||||||||||||||||||||||||||||||||||||||||||||||||||
Exercise of stock options | 328,471 | 14 | — | — | 14 | — | 14 | — | ||||||||||||||||||||||||||||||||||||||||||
Restricted stock awards | 227,867 | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
Other benefit plans | 143,270 | 10 | — | — | 10 | — | 10 | — | ||||||||||||||||||||||||||||||||||||||||||
Dividend reinvestment plan | 18,690 | 2 | — | — | 2 | — | 2 | — | ||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation expense | — | 20 | — | — | 20 | — | 20 | — | ||||||||||||||||||||||||||||||||||||||||||
Shares acquired and retired | (4,531,394) | (70) | (243) | — | (313) | — | (313) | — | ||||||||||||||||||||||||||||||||||||||||||
Shares exchanged — benefit plans | (101,663) | (2) | (9) | — | (11) | — | (11) | — | ||||||||||||||||||||||||||||||||||||||||||
Forfeitures of restricted stock | (43,681) | — | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||||||||
Other | — | (4) | (11) | (4) | (19) | (2) | (21) | 11 | ||||||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2020 | 86,345,246 | $ | 1,367 | $ | 4,149 | $ | 1,273 | $ | 6,789 | $ | — | $ | 6,789 | $ | — | |||||||||||||||||||||||||||||||||||
Net earnings | — | — | 1,995 | — | 1,995 | — | 1,995 | |||||||||||||||||||||||||||||||||||||||||||
Other comprehensive loss | — | — | — | (1,154) | (1,154) | — | (1,154) | |||||||||||||||||||||||||||||||||||||||||||
Dividends ($28.06 per share) | — | — | (2,382) | — | (2,382) | — | (2,382) | |||||||||||||||||||||||||||||||||||||||||||
Shares issued: | ||||||||||||||||||||||||||||||||||||||||||||||||||
Exercise of stock options | 1,208,964 | 59 | — | — | 59 | — | 59 | |||||||||||||||||||||||||||||||||||||||||||
Restricted stock awards | 207,020 | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
Other benefit plans | 81,286 | 10 | — | — | 10 | — | 10 | |||||||||||||||||||||||||||||||||||||||||||
Dividend reinvestment plan | 69,095 | 8 | — | — | 8 | — | 8 | |||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation expense | — | 16 | — | — | 16 | — | 16 | |||||||||||||||||||||||||||||||||||||||||||
Shares acquired and retired | (2,777,684) | (44) | (275) | — | (319) | — | (319) | |||||||||||||||||||||||||||||||||||||||||||
Shares exchanged — benefit plans | (92,209) | (1) | (9) | — | (10) | — | (10) | |||||||||||||||||||||||||||||||||||||||||||
Forfeitures of restricted stock | (120,753) | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2021 | 84,920,965 | $ | 1,415 | $ | 3,478 | $ | 119 | $ | 5,012 | $ | — | $ | 5,012 |
Shareholders’ Equity | Redeemable | ||||||||||||||||||||||||||||||
Common | Common Stock and Capital | Retained | Accumulated Other Comp. | Noncon- trolling | Total | Noncon- trolling | |||||||||||||||||||||||||
Shares | Surplus | Earnings | Inc. (Loss) | Total | Interests | Equity | Interests | ||||||||||||||||||||||||
Balance at December 31, 2016 | 86,924,399 | $ | 1,198 | $ | 3,343 | $ | 375 | $ | 4,916 | $ | 3 | $ | 4,919 | $ | — | ||||||||||||||||
Net earnings | — | — | 475 | — | 475 | 2 | 477 | — | |||||||||||||||||||||||
Other comprehensive income | — | — | — | 296 | 296 | — | 296 | — | |||||||||||||||||||||||
Impact of the U.S. corporate tax rate change on AOCI | — | — | (145 | ) | 145 | — | — | — | — | ||||||||||||||||||||||
Dividends ($4.7875 per share) | — | — | (421 | ) | — | (421 | ) | — | (421 | ) | — | ||||||||||||||||||||
Shares issued: | |||||||||||||||||||||||||||||||
Exercise of stock options | 1,020,986 | 34 | — | — | 34 | — | 34 | — | |||||||||||||||||||||||
Restricted stock awards | 232,250 | — | — | — | — | — | — | — | |||||||||||||||||||||||
Other benefit plans | 99,588 | 10 | — | — | 10 | — | 10 | — | |||||||||||||||||||||||
Dividend reinvestment plan | 42,572 | 4 | — | — | 4 | — | 4 | — | |||||||||||||||||||||||
Stock-based compensation expense | — | 24 | — | — | 24 | — | 24 | — | |||||||||||||||||||||||
Shares exchanged — benefit plans | (37,718 | ) | (1 | ) | (4 | ) | — | (5 | ) | — | (5 | ) | — | ||||||||||||||||||
Forfeitures of restricted stock | (6,617 | ) | — | — | — | — | — | — | — | ||||||||||||||||||||||
Sale of redeemable noncontrolling interests | — | — | — | (3 | ) | (3 | ) | — | (3 | ) | 3 | ||||||||||||||||||||
Other | — | — | — | — | — | (4 | ) | (4 | ) | — | |||||||||||||||||||||
Balance at December 31, 2017 | 88,275,460 | $ | 1,269 | $ | 3,248 | $ | 813 | $ | 5,330 | $ | 1 | $ | 5,331 | $ | 3 | ||||||||||||||||
Cumulative effect of accounting change | — | — | 225 | (221 | ) | 4 | — | 4 | — | ||||||||||||||||||||||
Net earnings (losses) | — | — | 530 | — | 530 | 1 | 531 | (14 | ) | ||||||||||||||||||||||
Other comprehensive loss | — | — | — | (544 | ) | (544 | ) | — | (544 | ) | — | ||||||||||||||||||||
Dividends ($4.45 per share) | — | — | (397 | ) | — | (397 | ) | — | (397 | ) | — | ||||||||||||||||||||
Shares issued: | |||||||||||||||||||||||||||||||
Exercise of stock options | 778,270 | 29 | — | — | 29 | — | 29 | — | |||||||||||||||||||||||
Restricted stock awards | 200,625 | — | — | — | — | — | — | — | |||||||||||||||||||||||
Other benefit plans | 103,797 | 12 | — | — | 12 | — | 12 | — | |||||||||||||||||||||||
Dividend reinvestment plan | 29,998 | 3 | — | — | 3 | — | 3 | — | |||||||||||||||||||||||
Stock-based compensation expense | — | 23 | — | — | 23 | — | 23 | — | |||||||||||||||||||||||
Shares acquired and retired | (65,589 | ) | (1 | ) | (5 | ) | — | (6 | ) | — | (6 | ) | — | ||||||||||||||||||
Shares exchanged — benefit plans | (26,520 | ) | (1 | ) | (2 | ) | — | (3 | ) | — | (3 | ) | — | ||||||||||||||||||
Forfeitures of restricted stock | (4,317 | ) | — | — | — | — | — | — | — | ||||||||||||||||||||||
Other | — | — | (11 | ) | — | (11 | ) | — | (11 | ) | 11 | ||||||||||||||||||||
Balance at December 31, 2018 | 89,291,724 | $ | 1,334 | $ | 3,588 | $ | 48 | $ | 4,970 | $ | 2 | $ | 4,972 | $ | — | ||||||||||||||||
Net earnings (losses) | — | — | 897 | — | 897 | (2 | ) | 895 | (26 | ) | |||||||||||||||||||||
Other comprehensive income | — | — | — | 815 | 815 | — | 815 | — | |||||||||||||||||||||||
Dividends ($4.95 per share) | — | — | (446 | ) | — | (446 | ) | — | (446 | ) | — | ||||||||||||||||||||
Shares issued: | |||||||||||||||||||||||||||||||
Exercise of stock options | 747,167 | 31 | — | — | 31 | — | 31 | — | |||||||||||||||||||||||
Restricted stock awards | 232,635 | — | — | — | — | — | — | — | |||||||||||||||||||||||
Other benefit plans | 77,429 | 8 | — | — | 8 | — | 8 | — | |||||||||||||||||||||||
Dividend reinvestment plan | 19,334 | 2 | — | — | 2 | — | 2 | — | |||||||||||||||||||||||
Stock-based compensation expense | — | 23 | — | — | 23 | — | 23 | — | |||||||||||||||||||||||
Shares exchanged — benefit plans | (50,062 | ) | (1 | ) | (4 | ) | — | (5 | ) | — | (5 | ) | — | ||||||||||||||||||
Forfeitures of restricted stock | (14,541 | ) | — | — | — | — | — | — | — | ||||||||||||||||||||||
Other | — | — | (26 | ) | — | (26 | ) | — | (26 | ) | 26 | ||||||||||||||||||||
Balance at December 31, 2019 | 90,303,686 | $ | 1,397 | $ | 4,009 | $ | 863 | $ | 6,269 | $ | — | $ | 6,269 | $ | — |
Year ended December 31, | Year ended December 31, | |||||||||||||||||||||||||||
2019 | 2018 | 2017 | 2021 | 2020 | 2019 | |||||||||||||||||||||||
Operating Activities: | Operating Activities: | |||||||||||||||||||||||||||
Net earnings, including noncontrolling interests | $ | 869 | $ | 517 | $ | 477 | Net earnings, including noncontrolling interests | $ | 1,995 | $ | 721 | $ | 869 | |||||||||||||||
Adjustments: | Adjustments: | |||||||||||||||||||||||||||
Depreciation and amortization | 259 | 210 | 107 | Depreciation and amortization | 187 | 299 | 259 | |||||||||||||||||||||
Annuity benefits | 1,151 | 998 | 892 | Annuity benefits | 377 | 1,192 | 1,151 | |||||||||||||||||||||
Realized (gains) losses on investing activities | (288 | ) | 265 | (23 | ) | |||||||||||||||||||||||
Realized gains on investing activities | Realized gains on investing activities | (1,131) | (313) | (288) | ||||||||||||||||||||||||
Net (purchases) sales of trading securities | (5 | ) | 111 | 17 | Net (purchases) sales of trading securities | (5) | 20 | (5) | ||||||||||||||||||||
Deferred annuity and life policy acquisition costs | (206 | ) | (263 | ) | (225 | ) | Deferred annuity and life policy acquisition costs | (98) | (154) | (206) | ||||||||||||||||||
Change in: | Change in: | |||||||||||||||||||||||||||
Reinsurance and other receivables | (112 | ) | (211 | ) | (963 | ) | Reinsurance and other receivables | (350) | (533) | (112) | ||||||||||||||||||
Other assets | (406 | ) | 96 | 13 | Other assets | 344 | 138 | (406) | ||||||||||||||||||||
Insurance claims and reserves | 703 | 425 | 1,321 | Insurance claims and reserves | 912 | 812 | 703 | |||||||||||||||||||||
Payable to reinsurers | 62 | 9 | 109 | Payable to reinsurers | 113 | 13 | 62 | |||||||||||||||||||||
Other liabilities | 516 | (140 | ) | (18 | ) | Other liabilities | (70) | (71) | 516 | |||||||||||||||||||
Managed investment entities’ assets/liabilities | 23 | 148 | 60 | Managed investment entities’ assets/liabilities | (144) | 25 | 23 | |||||||||||||||||||||
Other operating activities, net | (110 | ) | (82 | ) | 37 | Other operating activities, net | (416) | 34 | (110) | |||||||||||||||||||
Net cash provided by operating activities | 2,456 | 2,083 | 1,804 | Net cash provided by operating activities | 1,714 | 2,183 | 2,456 | |||||||||||||||||||||
Investing Activities: | Investing Activities: | |||||||||||||||||||||||||||
Purchases of: | Purchases of: | |||||||||||||||||||||||||||
Fixed maturities | (8,260 | ) | (10,183 | ) | (9,485 | ) | Fixed maturities | (7,978) | (10,335) | (8,260) | ||||||||||||||||||
Equity securities | (242 | ) | (568 | ) | (182 | ) | Equity securities | (193) | (404) | (242) | ||||||||||||||||||
Mortgage loans | (442 | ) | (167 | ) | (254 | ) | Mortgage loans | (218) | (372) | (442) | ||||||||||||||||||
Equity index options and other investments | (991 | ) | (973 | ) | (831 | ) | Equity index options and other investments | (391) | (897) | (991) | ||||||||||||||||||
Real estate, property and equipment | (44 | ) | (80 | ) | (109 | ) | Real estate, property and equipment | (62) | (60) | (44) | ||||||||||||||||||
Businesses | — | (36 | ) | — | Businesses | (123) | (3) | — | ||||||||||||||||||||
Proceeds from: | Proceeds from: | |||||||||||||||||||||||||||
Maturities and redemptions of fixed maturities | 4,567 | 4,948 | 6,105 | Maturities and redemptions of fixed maturities | 5,035 | 5,749 | 4,567 | |||||||||||||||||||||
Repayments of mortgage loans | 184 | 201 | 215 | Repayments of mortgage loans | 84 | 84 | 184 | |||||||||||||||||||||
Sales of fixed maturities | 927 | 501 | 392 | Sales of fixed maturities | 745 | 3,729 | 927 | |||||||||||||||||||||
Sales of equity securities | 453 | 247 | 216 | Sales of equity securities | 523 | 656 | 453 | |||||||||||||||||||||
Sales and settlements of equity index options and other investments | 771 | 883 | 789 | Sales and settlements of equity index options and other investments | 584 | 988 | 771 | |||||||||||||||||||||
Sales of real estate, property and equipment | 4 | 3 | 55 | Sales of real estate, property and equipment | 46 | 5 | 4 | |||||||||||||||||||||
Cash and cash equivalents of businesses acquired | — | 13 | — | |||||||||||||||||||||||||
Sales of businesses | Sales of businesses | 3,581 | 3 | — | ||||||||||||||||||||||||
Cash and cash equivalents of businesses acquired and sold | Cash and cash equivalents of businesses acquired and sold | (2,058) | (425) | — | ||||||||||||||||||||||||
Managed investment entities: | Managed investment entities: | |||||||||||||||||||||||||||
Purchases of investments | (1,398 | ) | (2,117 | ) | (2,979 | ) | Purchases of investments | (2,155) | (1,502) | (1,398) | ||||||||||||||||||
Proceeds from sales and redemptions of investments | 1,409 | 1,948 | 2,774 | Proceeds from sales and redemptions of investments | 2,112 | 1,221 | 1,409 | |||||||||||||||||||||
Other investing activities, net | (3 | ) | 30 | 2 | Other investing activities, net | 32 | (1) | (3) | ||||||||||||||||||||
Net cash used in investing activities | (3,065 | ) | (5,350 | ) | (3,292 | ) | Net cash used in investing activities | (436) | (1,564) | (3,065) | ||||||||||||||||||
Financing Activities: | Financing Activities: | |||||||||||||||||||||||||||
Annuity receipts | 4,960 | 5,632 | 4,341 | |||||||||||||||||||||||||
Annuity surrenders, benefits and withdrawals | (3,358 | ) | (2,916 | ) | (2,405 | ) | ||||||||||||||||||||||
Net transfers from variable annuity assets | 60 | 47 | 54 | |||||||||||||||||||||||||
Additional long-term borrowings | 315 | — | 712 | Additional long-term borrowings | — | 634 | 315 | |||||||||||||||||||||
Reductions of long-term debt | (150 | ) | — | (745 | ) | Reductions of long-term debt | — | (150) | (150) | |||||||||||||||||||
Issuances of managed investment entities’ liabilities | 371 | 1,983 | 2,731 | |||||||||||||||||||||||||
Retirements of managed investment entities’ liabilities | (382 | ) | (1,935 | ) | (2,585 | ) | ||||||||||||||||||||||
Issuances of Common Stock | 36 | 33 | 37 | Issuances of Common Stock | 66 | 22 | 36 | |||||||||||||||||||||
Repurchases of Common Stock | — | (6 | ) | — | Repurchases of Common Stock | (319) | (313) | — | ||||||||||||||||||||
Cash dividends paid on Common Stock | (444 | ) | (394 | ) | (417 | ) | Cash dividends paid on Common Stock | (2,374) | (334) | (444) | ||||||||||||||||||
Other financing activities, net | — | — | (4 | ) | ||||||||||||||||||||||||
Net cash provided by financing activities | 1,408 | 2,444 | 1,719 | |||||||||||||||||||||||||
Annuity receipts | Annuity receipts | 2,403 | 4,287 | 4,960 | ||||||||||||||||||||||||
Ceded annuity receipts | Ceded annuity receipts | (311) | (492) | — | ||||||||||||||||||||||||
Annuity surrenders, benefits and withdrawals | Annuity surrenders, benefits and withdrawals | (1,931) | (3,711) | (3,358) | ||||||||||||||||||||||||
Ceded annuity surrenders, benefits and withdrawals | Ceded annuity surrenders, benefits and withdrawals | 282 | 206 | — | ||||||||||||||||||||||||
Net transfers from variable annuity assets | Net transfers from variable annuity assets | 34 | 61 | 60 | ||||||||||||||||||||||||
Cash transferred in annuity reinsurance | Cash transferred in annuity reinsurance | — | (554) | — | ||||||||||||||||||||||||
Issuances of managed investment entities’ liabilities | Issuances of managed investment entities’ liabilities | 2,883 | 429 | 371 | ||||||||||||||||||||||||
Retirements of managed investment entities’ liabilities | Retirements of managed investment entities’ liabilities | (2,690) | (208) | (382) | ||||||||||||||||||||||||
Net cash provided by (used in) financing activities | Net cash provided by (used in) financing activities | (1,957) | (123) | 1,408 | ||||||||||||||||||||||||
Net Change in Cash and Cash Equivalents | 799 | (823 | ) | 231 | Net Change in Cash and Cash Equivalents | (679) | 496 | 799 | ||||||||||||||||||||
Cash and cash equivalents at beginning of year | 1,515 | 2,338 | 2,107 | Cash and cash equivalents at beginning of year | 2,810 | 2,314 | 1,515 | |||||||||||||||||||||
Cash and cash equivalents at end of year | $ | 2,314 | $ | 1,515 | $ | 2,338 | Cash and cash equivalents at end of year | $ | 2,131 | $ | 2,810 | $ | 2,314 |
INDEX TO NOTES | |||||||||||||||||
A. | Accounting Policies | Long-Term Debt | |||||||||||||||
B. | Discontinued Operations | J. | Leases | ||||||||||||||
C. | Acquisitions and Sale of Businesses | K. | |||||||||||||||
Segments of Operations | L. | ||||||||||||||||
Fair Value Measurements | M. | ||||||||||||||||
Investments | N. | ||||||||||||||||
Insurance | |||||||||||||||||
Managed Investment Entities | Additional Information | ||||||||||||||||
Goodwill and Other Intangibles |
May 31, 2021 | December 31, 2020 | ||||||||||
Assets of businesses sold: | |||||||||||
Cash and cash equivalents | $ | 2,060 | $ | 1,145 | |||||||
Investments | 38,323 | 38,011 | |||||||||
Recoverables from reinsurers | 6,748 | 6,804 | |||||||||
Other assets | 2,152 | 1,925 | |||||||||
Total assets of discontinued annuity operations | 49,283 | 47,885 | |||||||||
Liabilities of businesses sold: | |||||||||||
Annuity benefits accumulated | 43,690 | 42,573 | |||||||||
Other liabilities | 1,813 | 1,885 | |||||||||
Total liabilities of discontinued annuity operations | 45,503 | 44,458 | |||||||||
Receivable from AFG for real estate-related investments | — | 537 | |||||||||
Reclassify AOCI | (913) | (1,071) | |||||||||
Net investment in annuity businesses sold, excluding AOCI | $ | 2,867 | $ | 2,893 |
Year Ended December 31, | |||||||||||||||||
2021 (*) | 2020 | 2019 | |||||||||||||||
Net investment income | $ | 746 | $ | 1,670 | $ | 1,774 | |||||||||||
Realized gains on securities | 112 | 365 | 132 | ||||||||||||||
Other income | 52 | 123 | 137 | ||||||||||||||
Total revenues | 910 | 2,158 | 2,043 | ||||||||||||||
Annuity benefits | 377 | 1,192 | 1,151 | ||||||||||||||
Annuity and supplemental insurance acquisition expenses | 136 | 306 | 253 | ||||||||||||||
Other expenses | 73 | 151 | 165 | ||||||||||||||
Total costs and expenses | 586 | 1,649 | 1,569 | ||||||||||||||
Earnings before income taxes from discontinued operations | 324 | 509 | 474 | ||||||||||||||
Provision for income taxes on discontinued operations | 66 | 102 | 96 | ||||||||||||||
Net earnings from discontinued operations, net of tax | 258 | 407 | 378 | ||||||||||||||
Gain on sale of discontinued operations, net of tax | 656 | — | — | ||||||||||||||
Net earnings from discontinued operations | $ | 914 | $ | 407 | $ | 378 |
November 30, 2018 | |||
Total purchase price | $ | 30 | |
Tangible assets acquired | 28 | ||
Liabilities acquired | 26 | ||
Net tangible assets acquired, at fair value | 2 | ||
Excess purchase price over net tangible assets acquired | $ | 28 | |
Allocation of excess purchase price: | |||
Intangible assets acquired (*) | $ | 25 | |
Deferred tax on intangible assets acquired (*) | (5 | ) | |
Goodwill | 8 | ||
$ | 28 |
Cash proceeds | $ | 3,571 | |||
Sale related expenses | (8) | ||||
Total net proceeds | 3,563 | ||||
Net investment in annuity businesses sold, excluding AOCI | 2,867 | ||||
Reclassify net deferred tax asset | (199) | ||||
Pretax gain on sale | 895 | ||||
Income tax expense: | |||||
Reclassify net deferred tax asset | 199 | ||||
Tax liabilities triggered by the sale | 41 | ||||
Other | (1) | ||||
Total income tax expense | 239 | ||||
Net gain on sale | $ | 656 |
Year ended December 31, | |||||||||||||||||
2021 (*) | 2020 | 2019 | |||||||||||||||
Net cash provided by operating activities | $ | 67 | $ | 898 | $ | 1,131 | |||||||||||
Net cash used in investing activities | (1,689) | (285) | (2,384) | ||||||||||||||
Net cash provided by (used in) financing activities | 477 | (203) | 1,662 |
Derivative | 2021 (*) | 2020 | 2019 | |||||||||||||||||
MBS with embedded derivatives | $ | (1) | $ | (2) | $ | 5 | ||||||||||||||
Fixed-indexed and variable-indexed annuities (embedded derivative) | (222) | (283) | (919) | |||||||||||||||||
Equity index call options | 237 | 223 | 804 | |||||||||||||||||
Equity index put options | 5 | 3 | 2 | |||||||||||||||||
Reinsurance contract (embedded derivative) | 1 | (1) | (2) | |||||||||||||||||
$ | 20 | $ | (60) | $ | (110) |
December 6, 2021 | |||||
Purchase price: | |||||
Cash | $ | 120 | |||
Fair value of contingent consideration | 23 | ||||
Total purchase price | 143 | ||||
Tangible assets acquired | 16 | ||||
Liabilities acquired | 3 | ||||
Net tangible assets acquired, at fair value | 13 | ||||
Excess purchase price over net tangible assets acquired | $ | 130 | |||
Allocation of excess purchase price: | |||||
Intangible assets acquired (*) | $ | 76 | |||
Deferred tax on intangible assets acquired (*) | (16) | ||||
Goodwill | 70 | ||||
$ | 130 |
Sale proceeds, net of expenses | $ | 3 | |||
Assets of businesses to be sold: | |||||
Cash and investments | $ | 453 | |||
Recoverables from reinsurers | 224 | ||||
Prepaid reinsurance premiums | 8 | ||||
Agents’ balances and premiums receivable | 42 | ||||
Other assets | 60 | ||||
Total assets | 787 | ||||
Liabilities of businesses to be sold: | |||||
Unpaid losses and loss adjustment expenses | 640 | ||||
Unearned premiums | 49 | ||||
Payable to reinsurers | 19 | ||||
Other liabilities | 92 | ||||
Total liabilities | 800 | ||||
Reclassify accumulated other comprehensive income | (7) | ||||
Net liabilities of businesses sold | $ | (20) | |||
Pretax gain on subsidiaries recorded in 2020 | $ | 23 |
Year ended December 31, | |||||||||||
2020 | 2019 | ||||||||||
Net earned premiums | $ | 200 | $ | 384 | |||||||
Loss and loss adjustment expenses | 218 | 225 | |||||||||
Commissions and other underwriting expenses | 117 | 195 | |||||||||
Underwriting loss | (135) | (36) | |||||||||
Net investment income (loss) | (5) | 6 | |||||||||
Other income and expenses, net | (5) | (10) | |||||||||
Loss before income taxes and noncontrolling interests | $ | (145) | $ | (40) |
Underwriting loss | $ | (135) | |||
Net investment income (loss) | (5) | ||||
Other income and expenses, net | (5) | ||||
Loss before income taxes and noncontrolling interests | (145) | ||||
Pretax gain on sale of subsidiaries | 23 | ||||
Total pretax loss from Neon exited lines | (122) | ||||
Tax benefit related to sale of subsidiaries | 72 | ||||
Less: Net loss attributable to noncontrolling interests | (11) | ||||
Net loss from Neon exited lines attributable to shareholders | $ | (39) |
2021 | 2020 | ||||||||||
Assets | |||||||||||
Property and casualty insurance (a) | $ | 21,312 | $ | 19,620 | |||||||
Other | 7,619 | 6,205 | |||||||||
Total assets of continuing operations | 28,931 | 25,825 | |||||||||
Assets of discontinued annuity operations | — | 47,885 | |||||||||
Total assets | $ | 28,931 | $ | 73,710 |
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 |
2021 | 2020 | 2019 | |||||||||||||||
Revenues | |||||||||||||||||
Property and casualty insurance: | |||||||||||||||||
Premiums earned: | |||||||||||||||||
Specialty | |||||||||||||||||
Property and transportation | $ | 2,144 | $ | 1,871 | $ | 1,828 | |||||||||||
Specialty casualty | 2,408 | 2,235 | 2,597 | ||||||||||||||
Specialty financial | 642 | 613 | 610 | ||||||||||||||
Other specialty | 210 | 180 | 150 | ||||||||||||||
Other lines (b) | — | 200 | — | ||||||||||||||
Total premiums earned | 5,404 | 5,099 | 5,185 | ||||||||||||||
Net investment income (c) | 663 | 399 | 472 | ||||||||||||||
Other income | 27 | 8 | 11 | ||||||||||||||
Total property and casualty insurance | 6,094 | 5,506 | 5,668 | ||||||||||||||
Other | 293 | 266 | 353 | ||||||||||||||
Real estate-related entities (d) | 51 | 49 | 37 | ||||||||||||||
Total revenues before realized gains (losses) | 6,438 | 5,821 | 6,058 | ||||||||||||||
Realized gains (losses) on securities | 110 | (75) | 155 | ||||||||||||||
Realized gains on subsidiaries | 4 | 23 | — | ||||||||||||||
Total revenues | $ | 6,552 | $ | 5,769 | $ | 6,213 |
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 |
2021 | 2020 | 2019 | |||||||||||||||
Earnings Before Income Taxes | |||||||||||||||||
Property and casualty insurance: | |||||||||||||||||
Underwriting: | |||||||||||||||||
Specialty | |||||||||||||||||
Property and transportation | $ | 279 | $ | 181 | $ | 79 | |||||||||||
Specialty casualty | 377 | 223 | 175 | ||||||||||||||
Specialty financial | 96 | 50 | 92 | ||||||||||||||
Other specialty | (15) | (28) | (21) | ||||||||||||||
Other lines (a) | (4) | (202) | (113) | ||||||||||||||
Total underwriting | 733 | 224 | 212 | ||||||||||||||
Investment and other income, net (b) | 657 | 360 | 437 | ||||||||||||||
Total property and casualty insurance | 1,390 | 584 | 649 | ||||||||||||||
Other (c) | (220) | (215) | (196) | ||||||||||||||
Real estate-related entities (d) | 51 | 22 | 26 | ||||||||||||||
Total earnings before realized gains (losses) and income taxes | 1,221 | 391 | 479 | ||||||||||||||
Realized gains (losses) on securities | 110 | (75) | 155 | ||||||||||||||
Realized gains on subsidiaries | 4 | 23 | — | ||||||||||||||
Total earnings before income taxes | $ | 1,335 | $ | 339 | $ | 634 |
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 |
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||
December 31, 2021 | |||||||||||||||||||||||
Assets: | |||||||||||||||||||||||
Available for sale (“AFS”) fixed maturities: | |||||||||||||||||||||||
U.S. Government and government agencies | $ | 215 | $ | 1 | $ | — | $ | 216 | |||||||||||||||
States, municipalities and political subdivisions | — | 1,791�� | 41 | 1,832 | |||||||||||||||||||
Foreign government | — | 246 | — | 246 | |||||||||||||||||||
Residential MBS | — | 946 | 14 | 960 | |||||||||||||||||||
Commercial MBS | — | 104 | — | 104 | |||||||||||||||||||
Collateralized loan obligations | — | 1,643 | — | 1,643 | |||||||||||||||||||
Other asset-backed securities | — | 2,398 | 278 | 2,676 | |||||||||||||||||||
Corporate and other | 11 | 2,402 | 267 | 2,680 | |||||||||||||||||||
Total AFS fixed maturities | 226 | 9,531 | 600 | 10,357 | |||||||||||||||||||
Trading fixed maturities | — | 28 | — | 28 | |||||||||||||||||||
Equity securities | 679 | 50 | 313 | 1,042 | |||||||||||||||||||
Assets of managed investment entities (“MIE”) | 390 | 4,893 | 13 | 5,296 | |||||||||||||||||||
Total assets accounted for at fair value | $ | 1,295 | $ | 14,502 | $ | 926 | $ | 16,723 | |||||||||||||||
Liabilities: | |||||||||||||||||||||||
Contingent consideration - acquisitions | $ | — | $ | — | $ | 23 | $ | 23 | |||||||||||||||
Liabilities of managed investment entities | 384 | 4,823 | 13 | 5,220 | |||||||||||||||||||
Total liabilities accounted for at fair value | $ | 384 | $ | 4,823 | $ | 36 | $ | 5,243 | |||||||||||||||
December 31, 2020 | |||||||||||||||||||||||
Assets: | |||||||||||||||||||||||
Available for sale fixed maturities: | |||||||||||||||||||||||
U.S. Government and government agencies | $ | 195 | $ | 3 | $ | — | $ | 198 | |||||||||||||||
States, municipalities and political subdivisions | — | 2,273 | 39 | 2,312 | |||||||||||||||||||
Foreign government | — | 176 | — | 176 | |||||||||||||||||||
Residential MBS | — | 877 | 38 | 915 | |||||||||||||||||||
Commercial MBS | — | 90 | 2 | 92 | |||||||||||||||||||
Collateralized loan obligations | — | 1,046 | 16 | 1,062 | |||||||||||||||||||
Other asset-backed securities | — | 1,742 | 305 | 2,047 | |||||||||||||||||||
Corporate and other | 4 | 2,140 | 138 | 2,282 | |||||||||||||||||||
Total AFS fixed maturities | 199 | 8,347 | 538 | 9,084 | |||||||||||||||||||
Trading fixed maturities | — | 24 | — | 24 | |||||||||||||||||||
Equity securities | 665 | 48 | 176 | 889 | |||||||||||||||||||
Assets of managed investment entities | 217 | 4,733 | 21 | 4,971 | |||||||||||||||||||
Total assets accounted for at fair value | $ | 1,081 | $ | 13,152 | $ | 735 | $ | 14,968 | |||||||||||||||
Liabilities: | |||||||||||||||||||||||
Liabilities of managed investment entities | $ | 215 | $ | 4,678 | $ | 21 | $ | 4,914 | |||||||||||||||
Total liabilities accounted for at fair value | $ | 215 | $ | 4,678 | $ | 21 | $ | 4,914 |
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
December 31, 2019 | |||||||||||||||
Assets: | |||||||||||||||
Available for sale (“AFS”) fixed maturities: | |||||||||||||||
U.S. Government and government agencies | $ | 151 | $ | 43 | $ | 15 | $ | 209 | |||||||
States, municipalities and political subdivisions | — | 6,858 | 105 | 6,963 | |||||||||||
Foreign government | — | 172 | — | 172 | |||||||||||
Residential MBS | — | 2,987 | 173 | 3,160 | |||||||||||
Commercial MBS | — | 892 | 35 | 927 | |||||||||||
Collateralized loan obligations | — | 4,265 | 15 | 4,280 | |||||||||||
Other asset-backed securities | — | 5,842 | 1,286 | 7,128 | |||||||||||
Corporate and other | 29 | 21,879 | 1,758 | 23,666 | |||||||||||
Total AFS fixed maturities | 180 | 42,938 | 3,387 | 46,505 | |||||||||||
Trading fixed maturities | 2 | 111 | — | 113 | |||||||||||
Equity securities | 1,433 | 67 | 437 | 1,937 | |||||||||||
Equity index call options | — | 924 | — | 924 | |||||||||||
Assets of managed investment entities (“MIE”) | 213 | 4,506 | 17 | 4,736 | |||||||||||
Variable annuity assets (separate accounts) (*) | — | 628 | — | 628 | |||||||||||
Other assets — derivatives | — | 50 | — | 50 | |||||||||||
Total assets accounted for at fair value | $ | 1,828 | $ | 49,224 | $ | 3,841 | $ | 54,893 | |||||||
Liabilities: | |||||||||||||||
Liabilities of managed investment entities | $ | 206 | $ | 4,349 | $ | 16 | $ | 4,571 | |||||||
Derivatives in annuity benefits accumulated | — | — | 3,730 | 3,730 | |||||||||||
Other liabilities — derivatives | — | 10 | — | 10 | |||||||||||
Total liabilities accounted for at fair value | $ | 206 | $ | 4,359 | $ | 3,746 | $ | 8,311 | |||||||
December 31, 2018 | |||||||||||||||
Assets: | |||||||||||||||
Available for sale fixed maturities: | |||||||||||||||
U.S. Government and government agencies | $ | 141 | $ | 83 | $ | 9 | $ | 233 | |||||||
States, municipalities and political subdivisions | — | 6,880 | 59 | 6,939 | |||||||||||
Foreign government | — | 142 | — | 142 | |||||||||||
Residential MBS | — | 2,547 | 197 | 2,744 | |||||||||||
Commercial MBS | — | 864 | 56 | 920 | |||||||||||
Collateralized loan obligations | — | 4,162 | 116 | 4,278 | |||||||||||
Other asset-backed securities | — | 4,802 | 731 | 5,533 | |||||||||||
Corporate and other | 28 | 19,184 | 1,996 | 21,208 | |||||||||||
Total AFS fixed maturities | 169 | 38,664 | 3,164 | 41,997 | |||||||||||
Trading fixed maturities | 9 | 96 | — | 105 | |||||||||||
Equity securities | 1,410 | 68 | 336 | 1,814 | |||||||||||
Equity index call options | — | 184 | — | 184 | |||||||||||
Assets of managed investment entities | 203 | 4,476 | 21 | 4,700 | |||||||||||
Variable annuity assets (separate accounts) (*) | — | 557 | — | 557 | |||||||||||
Other assets — derivatives | — | 16 | — | 16 | |||||||||||
Total assets accounted for at fair value | $ | 1,791 | $ | 44,061 | $ | 3,521 | $ | 49,373 | |||||||
Liabilities: | |||||||||||||||
Liabilities of managed investment entities | $ | 195 | $ | 4,297 | $ | 20 | $ | 4,512 | |||||||
Derivatives in annuity benefits accumulated | — | — | 2,720 | 2,720 | |||||||||||
Other liabilities — derivatives | — | 49 | — | 49 | |||||||||||
Total liabilities accounted for at fair value | $ | 195 | $ | 4,346 | $ | 2,740 | $ | 7,281 |
Level 2 To Level 1 Transfers | Level 1 To Level 2 Transfers | ||||||||||||||||||||||||||||||||||||||||
# of Transfers | Fair Value | # of Transfers | Fair Value | ||||||||||||||||||||||||||||||||||||||
2019 | 2018 | 2017 | 2019 | 2018 | 2017 | 2019 | 2018 | 2017 | 2019 | 2018 | 2017 | ||||||||||||||||||||||||||||||
Perpetual preferred stocks | 2 | 2 | 4 | $ | 11 | $ | 5 | $ | 23 | 1 | 2 | 2 | $ | 6 | $ | 6 | $ | 11 | |||||||||||||||||||||||
Common stocks | 1 | — | — | — | — | — | — | — | 1 | — | — | — |
Total realized/unrealized gains (losses) included in | Total realized/unrealized gains (losses) included in | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2018 | Net earnings | Other comprehensive income (loss) | Purchases and issuances | Sales and settlements | Transfer into Level 3 | Transfer out of Level 3 | Balance at December 31, 2019 | Balance at December 31, 2020 | Net earnings (loss) | OCI | Purchases and issuances | Sales and settlements | Transfer into Level 3 | Transfer out of Level 3 | Sale of annuity business | Balance at December 31, 2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
AFS fixed maturities: | AFS fixed maturities: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
U.S. government agency | $ | 9 | $ | — | $ | 7 | $ | — | $ | (1 | ) | $ | — | $ | — | $ | 15 | U.S. government agency | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | ||||||||||||||||||||||||||||||||||||||||||||||||
State and municipal | 59 | — | 5 | — | (3 | ) | 55 | (11 | ) | 105 | State and municipal | 39 | — | — | — | (4) | 8 | (2) | — | 41 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Residential MBS | 197 | 6 | (3 | ) | — | (20 | ) | 48 | (55 | ) | 173 | Residential MBS | 38 | (4) | — | 6 | (3) | 6 | (29) | — | 14 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commercial MBS | 56 | 2 | — | — | (12 | ) | 4 | (15 | ) | 35 | Commercial MBS | 2 | — | — | — | — | — | (2) | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Collateralized loan obligations | 116 | (5 | ) | 5 | — | — | 28 | (129 | ) | 15 | Collateralized loan obligations | 16 | 1 | — | — | (2) | — | (15) | — | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other asset-backed securities | 731 | — | 6 | 787 | (192 | ) | 23 | (69 | ) | 1,286 | Other asset-backed securities | 305 | 1 | — | 154 | (156) | 14 | (40) | — | 278 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Corporate and other | 1,996 | (3 | ) | 55 | 738 | (335 | ) | 30 | (723 | ) | 1,758 | Corporate and other | 138 | (1) | (5) | 184 | (45) | 5 | (9) | — | 267 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total AFS fixed maturities | 3,164 | — | 75 | 1,525 | (563 | ) | 188 | (1,002 | ) | 3,387 | Total AFS fixed maturities | 538 | (3) | (5) | 344 | (210) | 33 | (97) | — | 600 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity securities | 336 | (5 | ) | — | 52 | (2 | ) | 56 | — | 437 | Equity securities | 176 | 99 | — | 78 | (28) | — | (12) | — | 313 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Assets of MIE | 21 | (5 | ) | — | 1 | — | — | — | 17 | Assets of MIE | 21 | — | — | 5 | — | 1 | (14) | — | 13 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Assets of discontinued annuity operations | Assets of discontinued annuity operations | 2,971 | 85 | (22) | 209 | (327) | 32 | (229) | (2,719) | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total Level 3 assets | $ | 3,521 | $ | (10 | ) | $ | 75 | $ | 1,578 | $ | (565 | ) | $ | 244 | $ | (1,002 | ) | $ | 3,841 | Total Level 3 assets | $ | 3,706 | $ | 181 | $ | (27) | $ | 636 | $ | (565) | $ | 66 | $ | (352) | $ | (2,719) | $ | 926 | ||||||||||||||||||||||||||||||||||||||||||||||
Embedded derivatives (a) | $ | (2,720 | ) | $ | (919 | ) | $ | — | $ | (333 | ) | $ | 242 | $ | — | $ | — | $ | (3,730 | ) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total Level 3 liabilities (b) | $ | (2,720 | ) | $ | (919 | ) | $ | — | $ | (333 | ) | $ | 242 | $ | — | $ | — | $ | (3,730 | ) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Contingent consideration — acquisitions | Contingent consideration — acquisitions | $ | — | $ | — | $ | — | $ | (23) | $ | — | $ | — | $ | — | $ | — | $ | (23) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Liabilities of discontinued annuity operations | Liabilities of discontinued annuity operations | (3,933) | (223) | — | (146) | 159 | — | — | 4,143 | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total Level 3 liabilities | Total Level 3 liabilities | $ | (3,933) | $ | (223) | $ | — | $ | (169) | $ | 159 | $ | — | $ | — | $ | 4,143 | $ | (23) |
Total realized/unrealized gains (losses) included in | |||||||||||||||||||||||||||||||
Balance at December 31, 2017 | Net earnings | Other comprehensive income (loss) | Purchases and issuances | Sales and settlements | Transfer into Level 3 | Transfer out of Level 3 | Balance at December 31, 2018 | ||||||||||||||||||||||||
AFS fixed maturities: | |||||||||||||||||||||||||||||||
U.S. government agency | $ | 8 | $ | — | $ | — | $ | — | $ | — | $ | 1 | $ | — | $ | 9 | |||||||||||||||
State and municipal | 148 | — | (2 | ) | — | (3 | ) | — | (84 | ) | 59 | ||||||||||||||||||||
Residential MBS | 122 | (9 | ) | (4 | ) | — | (21 | ) | 130 | (21 | ) | 197 | |||||||||||||||||||
Commercial MBS | 36 | — | — | 20 | — | — | — | 56 | |||||||||||||||||||||||
Collateralized loan obligations | 200 | (3 | ) | (13 | ) | 35 | (20 | ) | 3 | (86 | ) | 116 | |||||||||||||||||||
Other asset-backed securities | 544 | — | (2 | ) | 391 | (228 | ) | 79 | (53 | ) | 731 | ||||||||||||||||||||
Corporate and other | 1,044 | (10 | ) | (18 | ) | 1,221 | (204 | ) | 27 | (64 | ) | 1,996 | |||||||||||||||||||
Total AFS fixed maturities | 2,102 | (22 | ) | (39 | ) | 1,667 | (476 | ) | 240 | (308 | ) | 3,164 | |||||||||||||||||||
Equity securities | 165 | 9 | — | 155 | (6 | ) | 30 | (17 | ) | 336 | |||||||||||||||||||||
Assets of MIE | 23 | (8 | ) | — | 6 | — | — | — | 21 | ||||||||||||||||||||||
Total Level 3 assets | $ | 2,290 | $ | (21 | ) | $ | (39 | ) | $ | 1,828 | $ | (482 | ) | $ | 270 | $ | (325 | ) | $ | 3,521 | |||||||||||
Embedded derivatives (a) | $ | (2,542 | ) | $ | 204 | $ | — | $ | (545 | ) | $ | 163 | $ | — | $ | — | $ | (2,720 | ) | ||||||||||||
Total Level 3 liabilities (b) | $ | (2,542 | ) | $ | 204 | $ | — | $ | (545 | ) | $ | 163 | $ | — | $ | — | $ | (2,720 | ) |
Total realized/unrealized gains (losses) included in | |||||||||||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2019 | Net earnings (loss) | OCI | Purchases and issuances | Sales and settlements | Transfer into Level 3 | Transfer out of Level 3 | Balance at December 31, 2020 | ||||||||||||||||||||||||||||||||||||||||
AFS fixed maturities: | |||||||||||||||||||||||||||||||||||||||||||||||
U.S. government agency | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||||||||||||||
State and municipal | 40 | — | 1 | — | (2) | — | — | 39 | |||||||||||||||||||||||||||||||||||||||
Residential MBS | 45 | (1) | (1) | — | (6) | 9 | (8) | 38 | |||||||||||||||||||||||||||||||||||||||
Commercial MBS | 6 | — | — | — | — | 1 | (5) | 2 | |||||||||||||||||||||||||||||||||||||||
Collateralized loan obligations | 1 | — | 5 | — | — | 52 | (42) | 16 | |||||||||||||||||||||||||||||||||||||||
Other asset-backed securities | 256 | (7) | 5 | 106 | (89) | 42 | (8) | 305 | |||||||||||||||||||||||||||||||||||||||
Corporate and other | 223 | 1 | — | 68 | (60) | 4 | (98) | 138 | |||||||||||||||||||||||||||||||||||||||
Total AFS fixed maturities | 571 | (7) | 10 | 174 | (157) | 108 | (161) | 538 | |||||||||||||||||||||||||||||||||||||||
Equity securities | 161 | (12) | — | 37 | (7) | 9 | (12) | 176 | |||||||||||||||||||||||||||||||||||||||
Assets of MIE | 17 | (6) | — | 2 | — | 8 | — | 21 | |||||||||||||||||||||||||||||||||||||||
Assets of discontinued annuity operations | 3,092 | (17) | 59 | 568 | (442) | 495 | (784) | 2,971 | |||||||||||||||||||||||||||||||||||||||
Total Level 3 assets | $ | 3,841 | $ | (42) | $ | 69 | $ | 781 | $ | (606) | $ | 620 | $ | (957) | $ | 3,706 | |||||||||||||||||||||||||||||||
Liabilities of discontinued annuity operations | $ | (3,730) | $ | (283) | $ | — | $ | (242) | $ | 322 | $ | — | $ | — | $ | (3,933) | |||||||||||||||||||||||||||||||
Total Level 3 liabilities | $ | (3,730) | $ | (283) | $ | — | $ | (242) | $ | 322 | $ | — | $ | — | $ | (3,933) |
Total realized/unrealized gains (losses) included in | |||||||||||||||||||||||||||||||
Balance at December 31, 2016 | Net earnings | Other comprehensive income (loss) | Purchases and issuances | Sales and settlements | Transfer into Level 3 | Transfer out of Level 3 | Balance at December 31, 2017 | ||||||||||||||||||||||||
AFS fixed maturities: | |||||||||||||||||||||||||||||||
U.S. government agency | $ | 8 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 8 | |||||||||||||||
State and municipal | 140 | — | 2 | — | (2 | ) | 10 | (2 | ) | 148 | |||||||||||||||||||||
Residential MBS | 190 | (4 | ) | 2 | 1 | (40 | ) | 44 | (71 | ) | 122 | ||||||||||||||||||||
Commercial MBS | 25 | 2 | — | 15 | (10 | ) | 4 | — | 36 | ||||||||||||||||||||||
Collateralized loan obligations | 174 | (1 | ) | (1 | ) | 55 | (27 | ) | — | — | 200 | ||||||||||||||||||||
Other asset-backed securities | 310 | 1 | 2 | 355 | (105 | ) | 202 | (221 | ) | 544 | |||||||||||||||||||||
Corporate and other | 712 | (5 | ) | 2 | 606 | (237 | ) | 29 | (63 | ) | 1,044 | ||||||||||||||||||||
Total AFS fixed maturities | 1,559 | (7 | ) | 7 | 1,032 | (421 | ) | 289 | (357 | ) | 2,102 | ||||||||||||||||||||
Equity securities | 174 | (21 | ) | 10 | 38 | (16 | ) | — | (20 | ) | 165 | ||||||||||||||||||||
Assets of MIE | 29 | (11 | ) | — | 9 | — | — | (4 | ) | 23 | |||||||||||||||||||||
Total Level 3 assets | $ | 1,762 | $ | (39 | ) | $ | 17 | $ | 1,079 | $ | (437 | ) | $ | 289 | $ | (381 | ) | $ | 2,290 | ||||||||||||
Embedded derivatives (a) | $ | (1,759 | ) | $ | (589 | ) | $ | — | $ | (300 | ) | $ | 106 | $ | — | $ | — | $ | (2,542 | ) | |||||||||||
Total Level 3 liabilities (b) | $ | (1,759 | ) | $ | (589 | ) | $ | — | $ | (300 | ) | $ | 106 | $ | — | $ | — | $ | (2,542 | ) |
Total realized/unrealized gains (losses) included in | |||||||||||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2018 | Net earnings (loss) | OCI | Purchases and issuances | Sales and settlements | Transfer into Level 3 | Transfer out of Level 3 | Balance at December 31, 2019 | ||||||||||||||||||||||||||||||||||||||||
AFS fixed maturities: | |||||||||||||||||||||||||||||||||||||||||||||||
U.S. government agency | $ | 1 | $ | — | $ | — | $ | — | $ | (1) | $ | — | $ | — | $ | — | |||||||||||||||||||||||||||||||
State and municipal | — | — | (1) | — | — | 45 | (4) | 40 | |||||||||||||||||||||||||||||||||||||||
Residential MBS | 37 | 3 | (1) | — | (3) | 12 | (3) | 45 | |||||||||||||||||||||||||||||||||||||||
Commercial MBS | 8 | 1 | — | — | — | — | (3) | 6 | |||||||||||||||||||||||||||||||||||||||
Collateralized loan obligations | 31 | (1) | 2 | — | — | 3 | (34) | 1 | |||||||||||||||||||||||||||||||||||||||
Other asset-backed securities | 188 | — | — | 157 | (43) | — | (46) | 256 | |||||||||||||||||||||||||||||||||||||||
Corporate and other | 277 | (2) | 3 | 166 | (84) | 1 | (138) | 223 | |||||||||||||||||||||||||||||||||||||||
Total AFS fixed maturities | 542 | 1 | 3 | 323 | (131) | 61 | (228) | 571 | |||||||||||||||||||||||||||||||||||||||
Equity securities | 124 | (6) | — | 19 | (1) | 25 | — | 161 | |||||||||||||||||||||||||||||||||||||||
Assets of MIE | 21 | (5) | — | 1 | — | — | — | 17 | |||||||||||||||||||||||||||||||||||||||
Assets of discontinued annuity operations | 2,834 | — | 72 | 1,235 | (433) | 158 | (774) | 3,092 | |||||||||||||||||||||||||||||||||||||||
Total Level 3 assets | $ | 3,521 | $ | (10) | $ | 75 | $ | 1,578 | $ | (565) | $ | 244 | $ | (1,002) | $ | 3,841 | |||||||||||||||||||||||||||||||
Liabilities of discontinued annuity operations | $ | (2,720) | $ | (919) | $ | — | $ | (333) | $ | 242 | $ | — | $ | — | $ | (3,730) | |||||||||||||||||||||||||||||||
Total Level 3 liabilities | $ | (2,720) | $ | (919) | $ | — | $ | (333) | $ | 242 | $ | — | $ | — | $ | (3,730) |
Carrying | Fair Value | ||||||||||||||||||||||||||||
Value | Total | Level 1 | Level 2 | Level 3 | |||||||||||||||||||||||||
2021 | |||||||||||||||||||||||||||||
Financial assets: | |||||||||||||||||||||||||||||
Cash and cash equivalents | $ | 2,131 | $ | 2,131 | $ | 2,131 | $ | — | $ | — | |||||||||||||||||||
Mortgage loans | 520 | 533 | — | — | 533 | ||||||||||||||||||||||||
Total financial assets not accounted for at fair value | $ | 2,651 | $ | 2,664 | $ | 2,131 | $ | — | $ | 533 | |||||||||||||||||||
Long-term debt | $ | 1,964 | $ | 2,261 | $ | — | $ | 2,258 | $ | 3 | |||||||||||||||||||
Total financial liabilities not accounted for at fair value | $ | 1,964 | $ | 2,261 | $ | — | $ | 2,258 | $ | 3 | |||||||||||||||||||
2020 | |||||||||||||||||||||||||||||
Financial assets: | |||||||||||||||||||||||||||||
Cash and cash equivalents | $ | 1,665 | $ | 1,665 | $ | 1,665 | $ | — | $ | — | |||||||||||||||||||
Mortgage loans | 377 | 382 | — | — | 382 | ||||||||||||||||||||||||
Total financial assets not accounted for at fair value | $ | 2,042 | $ | 2,047 | $ | 1,665 | $ | — | $ | 382 | |||||||||||||||||||
Long-term debt | $ | 1,963 | $ | 2,325 | $ | — | $ | 2,322 | $ | 3 | |||||||||||||||||||
Total financial liabilities not accounted for at fair value | $ | 1,963 | $ | 2,325 | $ | — | $ | 2,322 | $ | 3 |
Carrying | Fair Value | ||||||||||||||||||
Value | Total | Level 1 | Level 2 | Level 3 | |||||||||||||||
2019 | |||||||||||||||||||
Financial assets: | |||||||||||||||||||
Cash and cash equivalents | $ | 2,314 | $ | 2,314 | $ | 2,314 | $ | — | $ | — | |||||||||
Mortgage loans | 1,329 | 1,346 | — | — | 1,346 | ||||||||||||||
Policy loans | 164 | 164 | — | — | 164 | ||||||||||||||
Total financial assets not accounted for at fair value | $ | 3,807 | $ | 3,824 | $ | 2,314 | $ | — | $ | 1,510 | |||||||||
Financial liabilities: | |||||||||||||||||||
Annuity benefits accumulated (*) | $ | 40,159 | $ | 40,182 | $ | — | $ | — | $ | 40,182 | |||||||||
Long-term debt | 1,473 | 1,622 | — | 1,619 | 3 | ||||||||||||||
Total financial liabilities not accounted for at fair value | $ | 41,632 | $ | 41,804 | $ | — | $ | 1,619 | $ | 40,185 | |||||||||
2018 | |||||||||||||||||||
Financial assets: | |||||||||||||||||||
Cash and cash equivalents | $ | 1,515 | $ | 1,515 | $ | 1,515 | $ | — | $ | — | |||||||||
Mortgage loans | 1,068 | 1,056 | — | — | 1,056 | ||||||||||||||
Policy loans | 174 | 174 | — | — | 174 | ||||||||||||||
Total financial assets not accounted for at fair value | $ | 2,757 | $ | 2,745 | $ | 1,515 | $ | — | $ | 1,230 | |||||||||
Financial liabilities: | |||||||||||||||||||
Annuity benefits accumulated (*) | $ | 36,384 | $ | 34,765 | $ | — | $ | — | $ | 34,765 | |||||||||
Long-term debt | 1,302 | 1,231 | — | 1,228 | 3 | ||||||||||||||
Total financial liabilities not accounted for at fair value | $ | 37,686 | $ | 35,996 | $ | — | $ | 1,228 | $ | 34,768 |
Amortized Cost | Allowance for Expected Credit Losses | Gross Unrealized | Net Unrealized | Fair Value | |||||||||||||||||||||||||||||||
Gains | Losses | ||||||||||||||||||||||||||||||||||
December 31, 2021 | |||||||||||||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||||||||||
U.S. Government and government agencies | $ | 216 | $ | — | $ | 2 | $ | (2) | $ | — | $ | 216 | |||||||||||||||||||||||
States municipalities and political subdivisions | 1,758 | — | 74 | — | 74 | 1,832 | |||||||||||||||||||||||||||||
Foreign government | 248 | — | — | (2) | (2) | 246 | |||||||||||||||||||||||||||||
Residential MBS | 915 | — | 48 | (3) | 45 | 960 | |||||||||||||||||||||||||||||
Commercial MBS | 102 | — | 2 | — | 2 | 104 | |||||||||||||||||||||||||||||
Collateralized loan obligations | 1,643 | 1 | 3 | (2) | 1 | 1,643 | |||||||||||||||||||||||||||||
Other asset-backed securities | 2,677 | 7 | 17 | (11) | 6 | 2,676 | |||||||||||||||||||||||||||||
Corporate and other | 2,634 | 1 | 55 | (8) | 47 | 2,680 | |||||||||||||||||||||||||||||
Total fixed maturities | $ | 10,193 | $ | 9 | $ | 201 | $ | (28) | $ | 173 | $ | 10,357 | |||||||||||||||||||||||
December 31, 2020 | |||||||||||||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||||||||||
U.S. Government and government agencies | $ | 192 | $ | — | $ | 6 | $ | — | $ | 6 | $ | 198 | |||||||||||||||||||||||
States municipalities and political subdivisions | 2,196 | — | 116 | — | 116 | 2,312 | |||||||||||||||||||||||||||||
Foreign government | 172 | — | 4 | — | 4 | 176 | |||||||||||||||||||||||||||||
Residential MBS | 859 | — | 57 | (1) | 56 | 915 | |||||||||||||||||||||||||||||
Commercial MBS | 89 | — | 3 | — | 3 | 92 | |||||||||||||||||||||||||||||
Collateralized loan obligations | 1,065 | 3 | 4 | (4) | — | 1,062 | |||||||||||||||||||||||||||||
Other asset-backed securities | 2,040 | 7 | 27 | (13) | 14 | 2,047 | |||||||||||||||||||||||||||||
Corporate and other | 2,199 | 2 | 88 | (3) | 85 | 2,282 | |||||||||||||||||||||||||||||
Total fixed maturities | $ | 8,812 | $ | 12 | $ | 305 | $ | (21) | $ | 284 | $ | 9,084 |
Amortized Cost | Allowance for Expected Credit Losses | Gross Unrealized | Net Unrealized | Fair Value | |||||||||||||||||||||||||||||||
Gains | Losses | ||||||||||||||||||||||||||||||||||
December 31, 2020 | |||||||||||||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||||||||||
U.S. Government and government agencies | $ | 39 | $ | — | $ | 5 | $ | — | $ | 5 | $ | 44 | |||||||||||||||||||||||
States, municipalities and political subdivisions | 3,053 | — | 370 | (2) | 368 | 3,421 | |||||||||||||||||||||||||||||
Foreign government | 31 | — | 4 | — | 4 | 35 | |||||||||||||||||||||||||||||
Residential MBS | 1,953 | 3 | 194 | (4) | 190 | 2,140 | |||||||||||||||||||||||||||||
Commercial MBS | 659 | — | 40 | (1) | 39 | 698 | |||||||||||||||||||||||||||||
Collateralized loan obligations | 3,491 | 10 | 23 | (13) | 10 | 3,491 | |||||||||||||||||||||||||||||
Other asset-backed securities | 5,098 | 11 | 142 | (53) | 89 | 5,176 | |||||||||||||||||||||||||||||
Corporate and other | 17,272 | 4 | 1,874 | (24) | 1,850 | 19,118 | |||||||||||||||||||||||||||||
Total fixed maturities | $ | 31,596 | $ | 28 | $ | 2,652 | $ | (97) | $ | 2,555 | $ | 34,123 |
2019 | 2018 | ||||||||||||||||||||||||||||||||||||||
Amortized Cost | Gross Unrealized | Net Unrealized | Fair Value | Amortized Cost | Gross Unrealized | Net Unrealized | Fair Value | ||||||||||||||||||||||||||||||||
Gains | Losses | Gains | Losses | ||||||||||||||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||||||||||||||
U.S. Government and government agencies | $ | 199 | $ | 10 | $ | — | $ | 10 | $ | 209 | $ | 235 | $ | 1 | $ | (3 | ) | $ | (2 | ) | $ | 233 | |||||||||||||||||
States municipalities and political subdivisions | 6,604 | 363 | (4 | ) | 359 | 6,963 | 6,825 | 169 | (55 | ) | 114 | 6,939 | |||||||||||||||||||||||||||
Foreign government | 170 | 3 | (1 | ) | 2 | 172 | 140 | 2 | — | 2 | 142 | ||||||||||||||||||||||||||||
Residential MBS | 2,900 | 265 | (5 | ) | 260 | 3,160 | 2,476 | 277 | (9 | ) | 268 | 2,744 | |||||||||||||||||||||||||||
Commercial MBS | 896 | 31 | — | 31 | 927 | 905 | 17 | (2 | ) | 15 | 920 | ||||||||||||||||||||||||||||
Collateralized loan obligations | 4,307 | 10 | (37 | ) | (27 | ) | 4,280 | 4,350 | 1 | (73 | ) | (72 | ) | 4,278 | |||||||||||||||||||||||||
Other asset-backed securities | 6,992 | 156 | (20 | ) | 136 | 7,128 | 5,431 | 129 | (27 | ) | 102 | 5,533 | |||||||||||||||||||||||||||
Corporate and other | 22,456 | 1,231 | (21 | ) | 1,210 | 23,666 | 21,475 | 167 | (434 | ) | (267 | ) | 21,208 | ||||||||||||||||||||||||||
Total fixed maturities | $ | 44,524 | $ | 2,069 | $ | (88 | ) | $ | 1,981 | $ | 46,505 | $ | 41,837 | $ | 763 | $ | (603 | ) | $ | 160 | $ | 41,997 |
2019 | 2018 | 2021 | 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value | Fair Value | Fair Value | Fair Value | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Actual | over (under) | Actual | over (under) | Actual | over (under) | Actual | over (under) | |||||||||||||||||||||||||||||||||||||||||||||||||||
Cost | Fair Value | Cost | Cost | Fair Value | Cost | Cost | Fair Value | Cost | Cost | Fair Value | Cost | |||||||||||||||||||||||||||||||||||||||||||||||
Common stocks | $ | 1,164 | $ | 1,283 | $ | 119 | $ | 1,241 | $ | 1,148 | $ | (93 | ) | Common stocks | $ | 491 | $ | 586 | $ | 95 | $ | 516 | $ | 510 | $ | (6) | ||||||||||||||||||||||||||||||||
Perpetual preferred stocks | 640 | 654 | 14 | 705 | 666 | (39 | ) | Perpetual preferred stocks | 403 | 456 | 53 | 369 | 379 | 10 | ||||||||||||||||||||||||||||||||||||||||||||
Total equity securities carried at fair value | $ | 1,804 | $ | 1,937 | $ | 133 | $ | 1,946 | $ | 1,814 | $ | (132 | ) | Total equity securities carried at fair value | $ | 894 | $ | 1,042 | $ | 148 | $ | 885 | $ | 889 | $ | 4 |
Carrying Value | Net Investment Income | ||||||||||||||||||||||||||||
December 31, 2021 | December 31, 2020 | 2021 | 2020 | 2019 | |||||||||||||||||||||||||
Real estate-related investments (*) | $ | 1,130 | $ | 915 | $ | 226 | $ | 92 | $ | 67 | |||||||||||||||||||
Private equity | 352 | 266 | 100 | 18 | 24 | ||||||||||||||||||||||||
Private debt | 35 | 54 | (5) | (11) | 6 | ||||||||||||||||||||||||
Total investments accounted for using the equity method | $ | 1,517 | $ | 1,235 | $ | 321 | $ | 99 | $ | 97 |
Less Than Twelve Months | Twelve Months or More | ||||||||||||||||||||||||||||||||||
Unrealized Loss | Fair Value | Fair Value as % of Cost | Unrealized Loss | Fair Value | Fair Value as % of Cost | ||||||||||||||||||||||||||||||
December 31, 2021 | |||||||||||||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||||||||||
U.S. Government and government agencies | $ | (1) | $ | 92 | 99 | % | $ | (1) | $ | 22 | 96 | % | |||||||||||||||||||||||
States, municipalities and political subdivisions | — | 9 | 100 | % | — | 13 | 100 | % | |||||||||||||||||||||||||||
Foreign government | (2) | 160 | 99 | % | — | — | — | % | |||||||||||||||||||||||||||
Residential MBS | (3) | 419 | 99 | % | — | 7 | 100 | % | |||||||||||||||||||||||||||
Commercial MBS | — | 34 | 100 | % | — | — | — | % | |||||||||||||||||||||||||||
Collateralized loan obligations | (1) | 806 | 100 | % | (1) | 77 | 99 | % | |||||||||||||||||||||||||||
Other asset-backed securities | (8) | 1,250 | 99 | % | (3) | 81 | 96 | % | |||||||||||||||||||||||||||
Corporate and other | (8) | 500 | 98 | % | — | 26 | 100 | % | |||||||||||||||||||||||||||
Total fixed maturities | $ | (23) | $ | 3,270 | 99 | % | $ | (5) | $ | 226 | 98 | % | |||||||||||||||||||||||
December 31, 2020 | |||||||||||||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||||||||||
U.S. Government and government agencies | $ | — | $ | 23 | 100 | % | $ | — | $ | — | — | % | |||||||||||||||||||||||
States, municipalities and political subdivisions | — | 39 | 100 | % | — | 10 | 100 | % | |||||||||||||||||||||||||||
Foreign government | — | 7 | 100 | % | — | — | — | % | |||||||||||||||||||||||||||
Residential MBS | (1) | 86 | 99 | % | — | 7 | 100 | % | |||||||||||||||||||||||||||
Commercial MBS | — | 7 | 100 | % | — | 5 | 100 | % | |||||||||||||||||||||||||||
Collateralized loan obligations | (1) | 192 | 99 | % | (3) | 366 | 99 | % | |||||||||||||||||||||||||||
Other asset-backed securities | (10) | 465 | 98 | % | (3) | 92 | 97 | % | |||||||||||||||||||||||||||
Corporate and other | (2) | 133 | 99 | % | (1) | 17 | 94 | % | |||||||||||||||||||||||||||
Total fixed maturities | $ | (14) | $ | 952 | 99 | % | $ | (7) | $ | 497 | 99 | % |
Less Than Twelve Months | Twelve Months or More | |||||||||||||||||||||
Unrealized Loss | Fair Value | Fair Value as % of Cost | Unrealized Loss | Fair Value | Fair Value as % of Cost | |||||||||||||||||
December 31, 2019 | ||||||||||||||||||||||
Fixed maturities: | ||||||||||||||||||||||
U.S. Government and government agencies | $ | — | $ | 16 | 100 | % | $ | — | $ | 11 | 100 | % | ||||||||||
States, municipalities and political subdivisions | (3 | ) | 254 | 99 | % | (1 | ) | 82 | 99 | % | ||||||||||||
Foreign government | (1 | ) | 70 | 99 | % | — | — | — | % | |||||||||||||
Residential MBS | (4 | ) | 509 | 99 | % | (1 | ) | 69 | 99 | % | ||||||||||||
Commercial MBS | — | 17 | 100 | % | — | — | — | % | ||||||||||||||
Collateralized loan obligations | (11 | ) | 1,284 | 99 | % | (26 | ) | 1,728 | 99 | % | ||||||||||||
Other asset-backed securities | (12 | ) | 1,211 | 99 | % | (8 | ) | 123 | 94 | % | ||||||||||||
Corporate and other | (13 | ) | 1,100 | 99 | % | (8 | ) | 211 | 96 | % | ||||||||||||
Total fixed maturities | $ | (44 | ) | $ | 4,461 | 99 | % | $ | (44 | ) | $ | 2,224 | 98 | % | ||||||||
December 31, 2018 | ||||||||||||||||||||||
Fixed maturities: | ||||||||||||||||||||||
U.S. Government and government agencies | $ | — | $ | 41 | 100 | % | $ | (3 | ) | $ | 120 | 98 | % | |||||||||
States, municipalities and political subdivisions | (23 | ) | 1,497 | 98 | % | (32 | ) | 902 | 97 | % | ||||||||||||
Foreign government | — | 18 | 100 | % | — | 4 | 100 | % | ||||||||||||||
Residential MBS | (4 | ) | 279 | 99 | % | (5 | ) | 139 | 97 | % | ||||||||||||
Commercial MBS | (1 | ) | 147 | 99 | % | (1 | ) | 30 | 97 | % | ||||||||||||
Collateralized loan obligations | (61 | ) | 3,540 | 98 | % | (12 | ) | 197 | 94 | % | ||||||||||||
Other asset-backed securities | (16 | ) | 1,866 | 99 | % | (11 | ) | 432 | 98 | % | ||||||||||||
Corporate and other | (306 | ) | 10,378 | 97 | % | (128 | ) | 2,078 | 94 | % | ||||||||||||
Total fixed maturities | $ | (411 | ) | $ | 17,766 | 98 | % | $ | (192 | ) | $ | 3,902 | 95 | % |
Structured securities (*) | Corporate and other | Total | |||||||||||||||
Balance at January 1, 2020 | $ | — | $ | — | $ | — | |||||||||||
Impact of adoption of new accounting policy | — | — | — | ||||||||||||||
Initial allowance for purchased securities with credit deterioration | — | — | — | ||||||||||||||
Provision for expected credit losses on securities with no previous allowance | 11 | 5 | 16 | ||||||||||||||
Additions (reductions) to previously recognized expected credit losses | (1) | (2) | (3) | ||||||||||||||
Reductions due to sales or redemptions | — | (1) | (1) | ||||||||||||||
Balance at December 31, 2020 | $ | 10 | $ | 2 | $ | 12 | |||||||||||
Initial allowance for purchased securities with credit deterioration | — | — | — | ||||||||||||||
Provision for expected credit losses on securities with no previous allowance | — | 1 | 1 | ||||||||||||||
Additions (reductions) to previously recognized expected credit losses | (2) | — | (2) | ||||||||||||||
Reductions due to sales or redemptions | — | (2) | (2) | ||||||||||||||
Balance at December 31, 2021 | $ | 8 | $ | 1 | $ | 9 |
2019 | 2018 | 2017 | |||||||||
Balance at January 1 | $ | 142 | $ | 145 | $ | 153 | |||||
Additional credit impairments on: | |||||||||||
Previously impaired securities | 1 | 1 | 1 | ||||||||
Securities without prior impairments | — | 1 | 3 | ||||||||
Reductions due to sales or redemptions | (9 | ) | (5 | ) | (12 | ) | |||||
Balance at December 31 | $ | 134 | $ | 142 | $ | 145 |
Amortized | Fair Value | ||||||||||||||||
Cost, net (*) | Amount | % | |||||||||||||||
Maturity | |||||||||||||||||
One year or less | $ | 1,228 | $ | 1,240 | 12 | % | |||||||||||
After one year through five years | 2,483 | 2,548 | 25 | % | |||||||||||||
After five years through ten years | 812 | 844 | 8 | % | |||||||||||||
After ten years | 332 | 342 | 3 | % | |||||||||||||
4,855 | 4,974 | 48 | % | ||||||||||||||
Collateralized loan obligations and other ABS (average life of approximately 3 years) | 4,312 | 4,319 | 42 | % | |||||||||||||
MBS (average life of approximately 3.5 years) | 1,017 | 1,064 | 10 | % | |||||||||||||
Total | $ | 10,184 | $ | 10,357 | 100 | % |
Amortized | Fair Value | |||||||||
Cost | Amount | % | ||||||||
Maturity | ||||||||||
One year or less | $ | 1,764 | $ | 1,793 | 4 | % | ||||
After one year through five years | 10,613 | 11,044 | 24 | % | ||||||
After five years through ten years | 13,513 | 14,419 | 31 | % | ||||||
After ten years | 3,539 | 3,754 | 8 | % | ||||||
29,429 | 31,010 | 67 | % | |||||||
Collateralized loan obligations and other ABS (average life of approximately 4 years) | 11,299 | 11,408 | 24 | % | ||||||
MBS (average life of approximately 4-1/2 years) | 3,796 | 4,087 | 9 | % | ||||||
Total | $ | 44,524 | $ | 46,505 | 100 | % |
Pretax | Deferred Tax | Net | |||||||||||||||
December 31, 2021 | |||||||||||||||||
Net unrealized gain on fixed maturities | $ | 173 | $ | (37) | $ | 136 | |||||||||||
December 31, 2020 | |||||||||||||||||
Net unrealized gain on fixed maturities held by continuing operations | $ | 284 | $ | (60) | $ | 224 | |||||||||||
Discontinued operations (*): | |||||||||||||||||
Net unrealized gain on fixed maturities | $ | 2,555 | $ | (536) | $ | 2,019 | |||||||||||
Deferred policy acquisition costs — annuity segment | (934) | 196 | (738) | ||||||||||||||
Annuity benefits accumulated | (324) | 68 | (256) | ||||||||||||||
Life, accident and health reserves | (3) | — | (3) | ||||||||||||||
Unearned revenue | 11 | (2) | 9 | ||||||||||||||
Total net unrealized gain from discontinued operations | 1,305 | (274) | 1,031 | ||||||||||||||
Total net unrealized gain on fixed maturity securities | $ | 1,589 | $ | (334) | $ | 1,255 |
Pretax | Deferred Tax | Net | |||||||||
December 31, 2019 | |||||||||||
Net unrealized gain on: | |||||||||||
Fixed maturities — annuity segment (*) | $ | 1,611 | $ | (338 | ) | $ | 1,273 | ||||
Fixed maturities — all other | 370 | (78 | ) | 292 | |||||||
Total fixed maturities | 1,981 | (416 | ) | 1,565 | |||||||
Deferred policy acquisition costs — annuity segment | (681 | ) | 143 | (538 | ) | ||||||
Annuity benefits accumulated | (219 | ) | 46 | (173 | ) | ||||||
Life, accident and health reserves | (1 | ) | — | (1 | ) | ||||||
Unearned revenue | 11 | (2 | ) | 9 | |||||||
Total net unrealized gain on marketable securities | $ | 1,091 | $ | (229 | ) | $ | 862 | ||||
December 31, 2018 | |||||||||||
Net unrealized gain on: | |||||||||||
Fixed maturities — annuity segment (*) | $ | 101 | $ | (21 | ) | $ | 80 | ||||
Fixed maturities — all other | 59 | (13 | ) | 46 | |||||||
Total fixed maturities | 160 | (34 | ) | 126 | |||||||
Deferred policy acquisition costs — annuity segment | (42 | ) | 9 | (33 | ) | ||||||
Annuity benefits accumulated | (14 | ) | 3 | (11 | ) | ||||||
Unearned revenue | 1 | — | 1 | ||||||||
Total net unrealized gain on marketable securities | $ | 105 | $ | (22 | ) | $ | 83 |
2021 | 2020 | 2019 | |||||||||||||||
Investment income: | |||||||||||||||||
Fixed maturities | $ | 290 | $ | 303 | $ | 315 | |||||||||||
Equity securities: | |||||||||||||||||
Dividends | 30 | 35 | 51 | ||||||||||||||
Change in fair value (a) (b) | 61 | 7 | 22 | ||||||||||||||
Equity in earnings of partnerships and similar investments | 321 | 99 | 97 | ||||||||||||||
Other | 40 | 23 | 53 | ||||||||||||||
Gross investment income | 742 | 467 | 538 | ||||||||||||||
Investment expenses | (12) | (6) | (6) | ||||||||||||||
Net investment income (b) | $ | 730 | $ | 461 | $ | 532 |
2019 | 2018 | 2017 | |||||||||
Investment income: | |||||||||||
Fixed maturities | $ | 1,915 | $ | 1,742 | $ | 1,607 | |||||
Equity securities: | |||||||||||
Dividends | 85 | 79 | 73 | ||||||||
Change in fair value (*) | 39 | 22 | 6 | ||||||||
Equity in earnings of partnerships and similar investments | 154 | 161 | 64 | ||||||||
Other | 132 | 112 | 102 | ||||||||
Gross investment income | 2,325 | 2,116 | 1,852 | ||||||||
Investment expenses | (22 | ) | (22 | ) | (21 | ) | |||||
Net investment income | $ | 2,303 | $ | 2,094 | $ | 1,831 |
2021 | 2020 | ||||||||||||||||||||||||||||||||||||||||||||||
Realized gains (losses) | Realized gains (losses) | ||||||||||||||||||||||||||||||||||||||||||||||
Before Impairments | Impairment Allowance | Total | Change in Unrealized | Before Impairments | Impairment Allowance | Total | Change in Unrealized | ||||||||||||||||||||||||||||||||||||||||
Fixed maturities | $ | (1) | $ | 1 | $ | — | $ | (111) | $ | 6 | $ | (13) | $ | (7) | $ | 61 | |||||||||||||||||||||||||||||||
Equity securities | 110 | — | 110 | — | (70) | — | (70) | — | |||||||||||||||||||||||||||||||||||||||
Mortgage loans and other investments | — | — | — | — | 2 | — | 2 | — | |||||||||||||||||||||||||||||||||||||||
Total pretax | 109 | 1 | 110 | (111) | (62) | (13) | (75) | 61 | |||||||||||||||||||||||||||||||||||||||
Tax effects | (23) | — | (23) | 23 | 13 | 3 | 16 | (13) | |||||||||||||||||||||||||||||||||||||||
Net of tax | $ | 86 | $ | 1 | $ | 87 | $ | (88) | $ | (49) | $ | (10) | $ | (59) | $ | 48 |
2019 | |||||||||||||||||||||||||||||||||||||||||||||||
Realized gains (losses) | |||||||||||||||||||||||||||||||||||||||||||||||
Before Impairments | Impairments | Total | Change in Unrealized | ||||||||||||||||||||||||||||||||||||||||||||
Fixed maturities | $ | 7 | $ | (8) | $ | (1) | $ | 174 | |||||||||||||||||||||||||||||||||||||||
Equity securities | 155 | — | 155 | — | |||||||||||||||||||||||||||||||||||||||||||
Mortgage loans and other investments | 1 | — | 1 | — | |||||||||||||||||||||||||||||||||||||||||||
Total pretax | 163 | (8) | 155 | 174 | |||||||||||||||||||||||||||||||||||||||||||
Tax effects | (34) | 2 | (32) | (36) | |||||||||||||||||||||||||||||||||||||||||||
Net of tax | $ | 129 | $ | (6) | $ | 123 | $ | 138 |
2019 | 2018 | ||||||||||||||||||||||||||||||
Realized gains (losses) | Realized gains (losses) | ||||||||||||||||||||||||||||||
Before Impairments | Impairments | Total | Change in Unrealized | Before Impairments | Impairments | Total | Change in Unrealized | ||||||||||||||||||||||||
Fixed maturities | $ | 26 | $ | (29 | ) | $ | (3 | ) | $ | 1,821 | $ | 6 | $ | (26 | ) | $ | (20 | ) | $ | (1,181 | ) | ||||||||||
Equity securities | 277 | — | 277 | — | (265 | ) | — | (265 | ) | — | |||||||||||||||||||||
Mortgage loans and other investments | 3 | — | 3 | — | 1 | — | 1 | — | |||||||||||||||||||||||
Other (*) | — | 10 | 10 | (835 | ) | 11 | 7 | 18 | 502 | ||||||||||||||||||||||
Total pretax | 306 | (19 | ) | 287 | 986 | (247 | ) | (19 | ) | (266 | ) | (679 | ) | ||||||||||||||||||
Tax effects | (64 | ) | 4 | (60 | ) | (207 | ) | 52 | 4 | 56 | 143 | ||||||||||||||||||||
Net of tax | $ | 242 | $ | (15 | ) | $ | 227 | $ | 779 | $ | (195 | ) | $ | (15 | ) | $ | (210 | ) | $ | (536 | ) |
2017 | |||||||||||||||||||||||
Realized gains (losses) | |||||||||||||||||||||||
Before Impairments | Impairments | Total | Change in Unrealized | ||||||||||||||||||||
Fixed maturities | $ | 17 | $ | (20 | ) | $ | (3 | ) | $ | 532 | |||||||||||||
Equity securities | 70 | (64 | ) | 6 | 128 | ||||||||||||||||||
Mortgage loans and other investments | (6 | ) | (4 | ) | (10 | ) | — | ||||||||||||||||
Other (*) | (3 | ) | 15 | 12 | (219 | ) | |||||||||||||||||
Total pretax | 78 | (73 | ) | 5 | 441 | ||||||||||||||||||
Tax effects: | |||||||||||||||||||||||
Reclassify impact of U.S. corporate tax rate change | — | — | — | 149 | |||||||||||||||||||
Other | (27 | ) | 25 | (2 | ) | (154 | ) | ||||||||||||||||
Total tax effects | (27 | ) | 25 | (2 | ) | (5 | ) | ||||||||||||||||
Net of tax | $ | 51 | $ | (48 | ) | $ | 3 | $ | 436 |
2021 | 2020 | 2019 | |||||||||||||||
Included in realized gains (losses) | $ | 65 | $ | (44) | $ | 105 | |||||||||||
Included in net investment income | 54 | 12 | 21 | ||||||||||||||
$ | 119 | $ | (32) | $ | 126 |
2019 | 2018 | ||||||
Included in realized gains (losses) | $ | 169 | $ | (279 | ) | ||
Included in net investment income | 38 | 22 | |||||
$ | 207 | $ | (257 | ) |
2021 | 2020 | 2019 | |||||||||||||||
Gross gains | $ | 7 | $ | 12 | $ | 4 | |||||||||||
Gross losses | (1) | (5) | (2) |
2019 | 2018 | 2017 | |||||||||
Gross gains | $ | 35 | $ | 22 | $ | 43 | |||||
Gross losses | (19 | ) | (14 | ) | (20 | ) |
December 31, 2019 | December 31, 2018 | |||||||||||||||||
Derivative | Balance Sheet Line | Asset | Liability | Asset | Liability | |||||||||||||
MBS with embedded derivatives | Fixed maturities | $ | 102 | $ | — | $ | 109 | $ | — | |||||||||
Public company warrants | Equity securities | — | — | — | — | |||||||||||||
Fixed-indexed and variable-indexed annuities (embedded derivative) | Annuity benefits accumulated | — | 3,730 | — | 2,720 | |||||||||||||
Equity index call options | Equity index call options | 924 | — | 184 | — | |||||||||||||
Equity index put options | Other liabilities | — | 1 | — | 1 | |||||||||||||
Reinsurance contract (embedded derivative) | Other liabilities | — | 4 | — | 2 | |||||||||||||
$ | 1,026 | $ | 3,735 | $ | 293 | $ | 2,723 |
Derivative | Statement of Earnings Line | 2019 | 2018 | 2017 | ||||||||||
MBS with embedded derivatives | Realized gains (losses) on securities | $ | 10 | $ | (7 | ) | $ | (6 | ) | |||||
Public company warrants | Realized gains (losses) on securities | (1 | ) | (3 | ) | — | ||||||||
Fixed-indexed and variable-indexed annuities (embedded derivative) (*) | Annuity benefits | (919 | ) | 204 | (589 | ) | ||||||||
Equity index call options | Annuity benefits | 804 | (298 | ) | 494 | |||||||||
Equity index put options | Annuity benefits | 2 | (1 | ) | — | |||||||||
Reinsurance contracts (embedded derivative) | Net investment income | (2 | ) | 2 | (2 | ) | ||||||||
$ | (106 | ) | $ | (103 | ) | $ | (103 | ) |
P&C | Annuity and Other | ||||||||||||||||||||||||||||||||
Deferred | Deferred | Sales | Consolidated | ||||||||||||||||||||||||||||||
Costs | Costs | Inducements | PVFP | Subtotal | Unrealized (*) | Total | Total | ||||||||||||||||||||||||||
Balance at December 31, 2016 | $ | 238 | $ | 1,110 | $ | 110 | $ | 46 | $ | 1,266 | $ | (265 | ) | $ | 1,001 | $ | 1,239 | ||||||||||||||||
Additions | 588 | 225 | 4 | — | 229 | — | 229 | 817 | |||||||||||||||||||||||||
Amortization: | |||||||||||||||||||||||||||||||||
Periodic amortization | (556 | ) | (161 | ) | (19 | ) | (8 | ) | (188 | ) | — | (188 | ) | (744 | ) | ||||||||||||||||||
Annuity unlocking | — | 34 | 6 | 1 | 41 | — | 41 | 41 | |||||||||||||||||||||||||
Included in realized gains | — | 9 | 1 | — | 10 | — | 10 | 10 | |||||||||||||||||||||||||
Foreign currency translation | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||
Other | — | — | — | 10 | 10 | — | 10 | 10 | |||||||||||||||||||||||||
Change in unrealized | — | — | — | — | — | (157 | ) | (157 | ) | (157 | ) | ||||||||||||||||||||||
Balance at December 31, 2017 | 270 | 1,217 | 102 | 49 | 1,368 | (422 | ) | 946 | 1,216 | ||||||||||||||||||||||||
Additions | 675 | 263 | 2 | — | 265 | — | 265 | 940 | |||||||||||||||||||||||||
Amortization: | |||||||||||||||||||||||||||||||||
Periodic amortization | (644 | ) | (238 | ) | (19 | ) | (7 | ) | (264 | ) | — | (264 | ) | (908 | ) | ||||||||||||||||||
Annuity unlocking | — | 29 | — | — | 29 | — | 29 | 29 | |||||||||||||||||||||||||
Included in realized gains | — | 14 | 1 | — | 15 | — | 15 | 15 | |||||||||||||||||||||||||
Foreign currency translation | (2 | ) | — | — | — | — | — | — | (2 | ) | |||||||||||||||||||||||
Change in unrealized | — | — | — | — | — | 392 | 392 | 392 | |||||||||||||||||||||||||
Balance at December 31, 2018 | 299 | 1,285 | 86 | 42 | 1,413 | (30 | ) | 1,383 | 1,682 | ||||||||||||||||||||||||
Additions | 744 | 206 | 2 | — | 208 | — | 208 | 952 | |||||||||||||||||||||||||
Amortization: | |||||||||||||||||||||||||||||||||
Periodic amortization | (721 | ) | (120 | ) | (13 | ) | (6 | ) | (139 | ) | — | (139 | ) | (860 | ) | ||||||||||||||||||
Annuity unlocking | — | (76 | ) | (1 | ) | — | (77 | ) | — | (77 | ) | (77 | ) | ||||||||||||||||||||
Included in realized gains | — | 8 | 1 | — | 9 | — | 9 | 9 | |||||||||||||||||||||||||
Foreign currency translation | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||
Change in unrealized | — | — | — | — | — | (669 | ) | (669 | ) | (669 | ) | ||||||||||||||||||||||
Balance at December 31, 2019 | $ | 322 | $ | 1,303 | $ | 75 | $ | 36 | $ | 1,414 | $ | (699 | ) | $ | 715 | $ | 1,037 |
2021 | 2020 | 2019 | |||||||||||||||
Balance at beginning of period | $ | 57 | $ | 48 | $ | 55 | |||||||||||
Purchases | 21 | 17 | — | ||||||||||||||
Sales | — | (1) | — | ||||||||||||||
Distributions | (22) | (6) | (8) | ||||||||||||||
Change in fair value | 20 | (1) | 1 | ||||||||||||||
Balance at end of period | $ | 76 | $ | 57 | $ | 48 |
Year ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Gains (losses) on change in fair value of assets/liabilities (*): | |||||||||||||||||
Assets | $ | 69 | $ | (69) | $ | 80 | |||||||||||
Liabilities | (59) | 49 | (94) | ||||||||||||||
Management fees paid to AFG | 16 | 15 | 15 | ||||||||||||||
CLO earnings (losses) attributable to AFG Shareholders: | |||||||||||||||||
From continuing operations | $ | 20 | $ | (1) | $ | 1 | |||||||||||
From discontinued annuity operations | 20 | (1) | 3 | ||||||||||||||
Total | $ | 40 | $ | (2) | $ | 4 |
Year ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Investment in CLO tranches | $ | 165 | $ | 188 | $ | 215 | |||||
Gains (losses) on change in fair value of assets/liabilities (a): | |||||||||||
Assets | 80 | (189 | ) | (8 | ) | ||||||
Liabilities | (110 | ) | 168 | 20 | |||||||
Management fees paid to AFG | 15 | 16 | 18 | ||||||||
CLO earnings attributable to AFG Shareholders (b) | 4 | 7 | 23 |
Property and Casualty | Annuity | Total | |||||||||
Balance at January 1, 2017 and December 31, 2017 | $ | 168 | $ | 31 | $ | 199 | |||||
Acquisition of subsidiary in 2018 | 8 | — | 8 | ||||||||
Balance at December 31, 2018 and December 31, 2019 | $ | 176 | $ | 31 | $ | 207 |
Balance at January 1, 2019 and December 31, 2019 and 2020 | $ | 176 | |||
Purchase of Verikai | 70 | ||||
Balance at December 31, 2021 | $ | 246 |
2021 | 2020 | ||||||||||||||||||||||||||||||||||
Principal | Discount and Issue Costs | Carrying Value | Principal | Discount and Issue Costs | Carrying Value | ||||||||||||||||||||||||||||||
Direct Senior Obligations of AFG: | |||||||||||||||||||||||||||||||||||
4.50% Senior Notes due June 2047 | $ | 590 | $ | (2) | $ | 588 | $ | 590 | $ | (2) | $ | 588 | |||||||||||||||||||||||
3.50% Senior Notes due August 2026 | 425 | (3) | 422 | 425 | (3) | 422 | |||||||||||||||||||||||||||||
5.25% Senior Notes due April 2030 | 300 | (5) | 295 | 300 | (6) | 294 | |||||||||||||||||||||||||||||
Other | 3 | — | 3 | 3 | — | 3 | |||||||||||||||||||||||||||||
1,318 | (10) | 1,308 | 1,318 | (11) | 1,307 | ||||||||||||||||||||||||||||||
Direct Subordinated Obligations of AFG: | |||||||||||||||||||||||||||||||||||
4.50% Subordinated Debentures due September 2060 | 200 | (5) | 195 | 200 | (5) | 195 | |||||||||||||||||||||||||||||
5.125% Subordinated Debentures due December 2059 | 200 | (6) | 194 | 200 | (6) | 194 | |||||||||||||||||||||||||||||
5.625% Subordinated Debentures due June 2060 | 150 | (4) | 146 | 150 | (4) | 146 | |||||||||||||||||||||||||||||
5.875% Subordinated Debentures due March 2059 | 125 | (4) | 121 | 125 | (4) | 121 | |||||||||||||||||||||||||||||
675 | (19) | 656 | 675 | (19) | 656 | ||||||||||||||||||||||||||||||
$ | 1,993 | $ | (29) | $ | 1,964 | $ | 1,993 | $ | (30) | $ | 1,963 |
2019 | 2018 | ||||||||||||||||||||||
Principal | Discount and Issue Costs | Carrying Value | Principal | Discount and Issue Costs | Carrying Value | ||||||||||||||||||
Direct Senior Obligations of AFG: | |||||||||||||||||||||||
4.50% Senior Notes due June 2047 | $ | 590 | $ | (2 | ) | $ | 588 | $ | 590 | $ | (2 | ) | $ | 588 | |||||||||
3.50% Senior Notes due August 2026 | 425 | (3 | ) | 422 | 425 | (4 | ) | 421 | |||||||||||||||
Other | 3 | — | 3 | 3 | — | 3 | |||||||||||||||||
1,018 | (5 | ) | 1,013 | 1,018 | (6 | ) | 1,012 | ||||||||||||||||
Direct Subordinated Obligations of AFG: | |||||||||||||||||||||||
5.125% Subordinated Debentures due December 2059 | 200 | (6 | ) | 194 | — | — | — | ||||||||||||||||
6% Subordinated Debentures due November 2055 | 150 | (5 | ) | 145 | 150 | (5 | ) | 145 | |||||||||||||||
5.875% Subordinated Debentures due March 2059 | 125 | (4 | ) | 121 | — | — | — | ||||||||||||||||
6-1/4% Subordinated Debentures due September 2054 | — | — | — | 150 | (5 | ) | 145 | ||||||||||||||||
475 | (15 | ) | 460 | 300 | (10 | ) | 290 | ||||||||||||||||
$ | 1,493 | $ | (20 | ) | $ | 1,473 | $ | 1,318 | $ | (16 | ) | $ | 1,302 |
2021 | 2020 | ||||||||||
Right-of-use asset (*) | $ | 118 | $ | 139 | |||||||
Lease liability | 136 | 159 |
2021 | 2020 | 2019 | |||||||||||||||
Lease expense: | |||||||||||||||||
Operating leases | $ | 41 | $ | 47 | $ | 46 | |||||||||||
Short-term leases | — | — | 1 | ||||||||||||||
Total lease expense included in other expenses | 41 | 47 | 47 | ||||||||||||||
Sublease income (*) | (2) | — | — | ||||||||||||||
Total lease expense, net of sublease income | $ | 39 | $ | 47 | $ | 47 |
2019 | |||
Lease expense: | |||
Operating leases | $ | 46 | |
Short-term leases | 1 | ||
Total lease expense | $ | 47 |
2021 | 2020 | 2019 | |||||||||||||||
Cash paid for lease liabilities reported in operating cash flows | $ | 43 | $ | 50 | $ | 49 | |||||||||||
Right-of-use assets obtained under new leases | 10 | 25 | 19 |
Cash paid for lease liabilities reported in operating cash flows | $ | 49 | |
Right-of-use assets obtained under new leases | 19 |
Operating lease payments: | Operating lease payments: | |||||||
2020 | $ | 46 | ||||||
2021 | 41 | |||||||
2022 | 32 | 2022 | $ | 38 | ||||
2023 | 27 | 2023 | 32 | |||||
2024 | 20 | 2024 | 26 | |||||
2025 | 2025 | 22 | ||||||
2026 | 2026 | 18 | ||||||
Thereafter | 35 | Thereafter | 13 | |||||
Total lease payments | 201 | Total lease payments | 149 | |||||
Impact of discounting | (21 | ) | Impact of discounting | (13) | ||||
Operating lease liability | $ | 180 | Operating lease liability | $ | 136 |
Weighted-average remaining lease term | ||||||
Weighted-average discount rate | % |
Shares | Average Grant Date Fair Value | ||||||||||||||||
Shares | Average Grant Date Fair Value | ||||||||||||||||
Outstanding at January 1, 2019 | 865,930 | $ | 84.06 | ||||||||||||||
Outstanding at January 1, 2021 | Outstanding at January 1, 2021 | 818,233 | $ | 101.65 | |||||||||||||
Granted | 232,635 | $ | 99.28 | Granted | 207,020 | $ | 111.13 | ||||||||||
Vested | (167,326 | ) | $ | 66.10 | Vested | (252,654) | $ | 95.69 | |||||||||
Forfeited | (11,304 | ) | $ | 90.26 | Forfeited | (120,753) | $ | 103.70 | |||||||||
Outstanding at December 31, 2019 | 919,935 | $ | 91.10 | ||||||||||||||
Outstanding at December 31, 2021 | Outstanding at December 31, 2021 | 651,846 | $ | 106.59 |
Shares | Average Exercise Price | Average Remaining Contractual Term | Aggregate Intrinsic Value (in millions) | ||||||||||||||||||||
Outstanding at January 1, 2021 | 1,589,094 | $ | 52.43 | ||||||||||||||||||||
Exercised | (1,208,964) | $ | 48.93 | ||||||||||||||||||||
Special dividend adjustment | 36,169 | n/a | |||||||||||||||||||||
Forfeited/Cancelled | (1,554) | $ | 58.36 | ||||||||||||||||||||
Outstanding at December 31, 2021 | 414,745 | $ | 46.04 | 2.1 years | $ | 38 | |||||||||||||||||
Options exercisable at December 31, 2021 | 414,745 | $ | 46.04 | 2.1 years | $ | 38 |
Shares | Average Exercise Price | Average Remaining Contractual Term | Aggregate Intrinsic Value (in millions) | |||||||||
Outstanding at January 1, 2019 | 2,667,442 | $ | 48.20 | |||||||||
Exercised | (747,167 | ) | $ | 41.13 | ||||||||
Forfeited/Cancelled | (2,485 | ) | $ | 61.88 | ||||||||
Outstanding at December 31, 2019 | 1,917,790 | $ | 50.93 | 3.7 years | $ | 113 | ||||||
Options exercisable at December 31, 2019 | 1,779,941 | $ | 50.13 | 3.6 years | $ | 107 |
Other Comprehensive Income (Loss) | |||||||||||||||||||||||||||||||||||||||||||||||
AOCI Beginning Balance | Pretax | Tax | Net of tax | Attributable to noncontrolling interests | Attributable to shareholders | Other | AOCI Ending Balance | ||||||||||||||||||||||||||||||||||||||||
Year ended December 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||
Net unrealized gains (losses) on securities: | |||||||||||||||||||||||||||||||||||||||||||||||
Unrealized holding losses on securities arising during the period | $ | (275) | $ | 57 | $ | (218) | $ | — | $ | (218) | |||||||||||||||||||||||||||||||||||||
Reclassification adjustment for realized (gains) losses included in net earnings (*) | (22) | 5 | (17) | — | (17) | ||||||||||||||||||||||||||||||||||||||||||
Reclassification for unrealized gains of subsidiaries sold | (1,119) | 235 | (884) | — | (884) | ||||||||||||||||||||||||||||||||||||||||||
Total net unrealized gains (losses) on securities | $ | 1,255 | (1,416) | 297 | (1,119) | — | (1,119) | $ | — | $ | 136 | ||||||||||||||||||||||||||||||||||||
Net unrealized gains (losses) on cash flow hedges: | |||||||||||||||||||||||||||||||||||||||||||||||
Unrealized holding losses on cash flow hedges arising during the period | (1) | — | (1) | — | (1) | ||||||||||||||||||||||||||||||||||||||||||
Reclassification adjustment for investment income included in net earnings from discontinued operations | (14) | 3 | (11) | — | (11) | ||||||||||||||||||||||||||||||||||||||||||
Reclassification for unrealized gains on cash flow hedges of subsidiaries sold | (37) | 8 | (29) | — | (29) | ||||||||||||||||||||||||||||||||||||||||||
Total net unrealized gains (losses) on cash flow hedges | 41 | (52) | 11 | (41) | — | (41) | — | — | |||||||||||||||||||||||||||||||||||||||
Foreign currency translation adjustments | (16) | (2) | — | (2) | — | (2) | — | (18) | |||||||||||||||||||||||||||||||||||||||
Pension and OPRP adjustments: | |||||||||||||||||||||||||||||||||||||||||||||||
Unrealized holding losses on pension and OPRP arising during the period | (1) | — | (1) | — | (1) | ||||||||||||||||||||||||||||||||||||||||||
Reclassification adjustment for pension settlement loss included in other expense in net earnings | 11 | (2) | 9 | — | 9 | ||||||||||||||||||||||||||||||||||||||||||
Total pension and OPRP adjustments | (7) | 10 | (2) | 8 | — | 8 | — | 1 | |||||||||||||||||||||||||||||||||||||||
Total | $ | 1,273 | $ | (1,460) | $ | 306 | $ | (1,154) | $ | — | $ | (1,154) | $ | — | $ | 119 | |||||||||||||||||||||||||||||||
Other Comprehensive Income (Loss) | |||||||||||||||||||||||||||||||
AOCI Beginning Balance | Pretax | Tax | Net of tax | Attributable to noncontrolling interests | Attributable to shareholders | Other (c) | AOCI Ending Balance | ||||||||||||||||||||||||
Year ended December 31, 2019 | |||||||||||||||||||||||||||||||
Net unrealized gains on securities: | |||||||||||||||||||||||||||||||
Unrealized holding gains on securities arising during the period | $ | 997 | $ | (209 | ) | $ | 788 | $ | — | $ | 788 | ||||||||||||||||||||
Reclassification adjustment for realized (gains) losses included in net earnings (a) | (11 | ) | 2 | (9 | ) | — | (9 | ) | |||||||||||||||||||||||
Total net unrealized gains on securities (b) | $ | 83 | 986 | (207 | ) | 779 | — | 779 | $ | — | $ | 862 | |||||||||||||||||||
Net unrealized gains (losses) on cash flow hedges | (11 | ) | 36 | (8 | ) | 28 | — | 28 | — | 17 | |||||||||||||||||||||
Foreign currency translation adjustments | (16 | ) | 7 | — | 7 | — | 7 | — | (9 | ) | |||||||||||||||||||||
Pension and other postretirement plans adjustments | (8 | ) | 1 | — | 1 | — | 1 | — | (7 | ) | |||||||||||||||||||||
Total | $ | 48 | $ | 1,030 | $ | (215 | ) | $ | 815 | $ | — | $ | 815 | $ | — | $ | 863 | ||||||||||||||
Year ended December 31, 2018 | |||||||||||||||||||||||||||||||
Net unrealized gains (losses) on securities: | |||||||||||||||||||||||||||||||
Unrealized holding losses on securities arising during the period | $ | (689 | ) | $ | 145 | $ | (544 | ) | $ | — | $ | (544 | ) | ||||||||||||||||||
Reclassification adjustment for realized (gains) losses included in net earnings (a) | 10 | (2 | ) | 8 | — | 8 | |||||||||||||||||||||||||
Total net unrealized gains (losses) on securities (b) | $ | 840 | (679 | ) | 143 | (536 | ) | — | (536 | ) | $ | (221 | ) | $ | 83 | ||||||||||||||||
Net unrealized gains (losses) on cash flow hedges | (13 | ) | 2 | — | 2 | — | 2 | — | (11 | ) | |||||||||||||||||||||
Foreign currency translation adjustments | (6 | ) | (9 | ) | (1 | ) | (10 | ) | — | (10 | ) | — | (16 | ) | |||||||||||||||||
Pension and other postretirement plans adjustments | (8 | ) | — | — | — | — | — | — | (8 | ) | |||||||||||||||||||||
Total | $ | 813 | $ | (686 | ) | $ | 142 | $ | (544 | ) | $ | — | $ | (544 | ) | $ | (221 | ) | $ | 48 | |||||||||||
Year ended December 31, 2017 | |||||||||||||||||||||||||||||||
Net unrealized gains on securities: | |||||||||||||||||||||||||||||||
Unrealized holding gains on securities arising during the period | $ | 456 | $ | (159 | ) | $ | 297 | $ | — | $ | 297 | ||||||||||||||||||||
Reclassification adjustment for realized (gains) losses included in net earnings (a) | (15 | ) | 5 | (10 | ) | — | (10 | ) | |||||||||||||||||||||||
Total net unrealized gains on securities (b) | $ | 404 | 441 | (154 | ) | 287 | — | 287 | $ | 149 | $ | 840 | |||||||||||||||||||
Net unrealized losses on cash flow hedges | (7 | ) | (6 | ) | 2 | (4 | ) | — | (4 | ) | (2 | ) | (13 | ) | |||||||||||||||||
Foreign currency translation adjustments | (15 | ) | 9 | 3 | 12 | — | 12 | (3 | ) | (6 | ) | ||||||||||||||||||||
Pension and other postretirement plans adjustments | (7 | ) | 1 | — | 1 | — | 1 | (2 | ) | (8 | ) | ||||||||||||||||||||
Total | $ | 375 | $ | 445 | $ | (149 | ) | $ | 296 | $ | — | $ | 296 | $ | 142 | $ | 813 |
Other Comprehensive Income (Loss) | |||||||||||||||||||||||||||||||||||||||||||||||
AOCI Beginning Balance | Pretax | Tax | Net of tax | Attributable to noncontrolling interests | Attributable to shareholders | Other | AOCI Ending Balance | ||||||||||||||||||||||||||||||||||||||||
Year ended December 31, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||
Net unrealized gains on securities: | |||||||||||||||||||||||||||||||||||||||||||||||
Unrealized holding gains on securities arising during the period | $ | 887 | $ | (187) | $ | 700 | $ | — | $ | 700 | |||||||||||||||||||||||||||||||||||||
Reclassification adjustment for realized (gains) losses included in net earnings (*) | (389) | 82 | (307) | — | (307) | ||||||||||||||||||||||||||||||||||||||||||
Total net unrealized gains on securities | $ | 862 | 498 | (105) | 393 | — | 393 | $ | — | $ | 1,255 | ||||||||||||||||||||||||||||||||||||
Net unrealized gains on cash flow hedges: | |||||||||||||||||||||||||||||||||||||||||||||||
Unrealized holding gains on cash flow hedges arising during the period | $ | 70 | $ | (14) | $ | 56 | $ | — | $ | 56 | |||||||||||||||||||||||||||||||||||||
Reclassification adjustment for investment income included in net earnings from discontinued operations | (40) | 8 | (32) | — | (32) | ||||||||||||||||||||||||||||||||||||||||||
Total net unrealized gains on cash flow hedges | 17 | 30 | (6) | 24 | — | 24 | — | 41 | |||||||||||||||||||||||||||||||||||||||
Foreign currency translation adjustments | (9) | (1) | — | (1) | (2) | (3) | (4) | (16) | |||||||||||||||||||||||||||||||||||||||
Pension and other postretirement plans adjustments | (7) | — | — | — | — | — | — | (7) | |||||||||||||||||||||||||||||||||||||||
Total | $ | 863 | $ | 527 | $ | (111) | $ | 416 | $ | (2) | $ | 414 | $ | (4) | $ | 1,273 | |||||||||||||||||||||||||||||||
Year ended December 31, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||
Net unrealized gains (losses) on securities: | |||||||||||||||||||||||||||||||||||||||||||||||
Unrealized holding gains on securities arising during the period | $ | 997 | $ | (209) | $ | 788 | $ | — | $ | 788 | |||||||||||||||||||||||||||||||||||||
Reclassification adjustment for realized (gains) losses included in net earnings (*) | (11) | 2 | (9) | — | (9) | ||||||||||||||||||||||||||||||||||||||||||
Total net unrealized gains on securities | $ | 83 | 986 | (207) | 779 | — | 779 | $ | — | $ | 862 | ||||||||||||||||||||||||||||||||||||
Net unrealized gains (losses) on cash flow hedges: | |||||||||||||||||||||||||||||||||||||||||||||||
Unrealized holding gains on cash flow hedges arising during the period | $ | 39 | $ | (8) | $ | 31 | $ | — | $ | 31 | |||||||||||||||||||||||||||||||||||||
Reclassification adjustment for investment income included in net earnings from discontinued operations | (3) | — | (3) | — | (3) | ||||||||||||||||||||||||||||||||||||||||||
Total net unrealized gains (losses) on cash flow hedges | (11) | 36 | (8) | 28 | — | 28 | — | 17 | |||||||||||||||||||||||||||||||||||||||
Foreign currency translation adjustments | (16) | 7 | — | 7 | — | 7 | — | (9) | |||||||||||||||||||||||||||||||||||||||
Pension and other postretirement plans adjustments | (8) | 1 | — | 1 | — | 1 | — | (7) | |||||||||||||||||||||||||||||||||||||||
Total | $ | 48 | $ | 1,030 | $ | (215) | $ | 815 | $ | — | $ | 815 | $ | — | $ | 863 |
OCI component | Affected line in the statement of earnings | |||||||||||||
Pretax | Realized gains (losses) on securities | |||||||||||||
Tax | Provision for income taxes |
2021 | 2020 | 2019 | |||||||||||||||||||||||||||||||||
Amount | % of EBT | Amount | % of EBT | Amount | % of EBT | ||||||||||||||||||||||||||||||
Earnings from continuing operations before income taxes (“EBT”) | $ | 1,335 | $ | 339 | $ | 634 | |||||||||||||||||||||||||||||
Income taxes at statutory rate | $ | 280 | 21 | % | $ | 71 | 21 | % | $ | 133 | 21 | % | |||||||||||||||||||||||
Effect of: | |||||||||||||||||||||||||||||||||||
Employee stock ownership plan dividend paid deduction | (16) | (1 | %) | (2) | (1 | %) | (3) | — | % | ||||||||||||||||||||||||||
Stock-based compensation | (13) | (1 | %) | (4) | (1 | %) | (7) | (1 | %) | ||||||||||||||||||||||||||
Tax exempt interest | (8) | (1 | %) | (10) | (3 | %) | (11) | (2 | %) | ||||||||||||||||||||||||||
Change in valuation allowance | (4) | — | % | (117) | (35 | %) | 17 | 3 | % | ||||||||||||||||||||||||||
Dividend received deduction | (2) | — | % | (2) | (1 | %) | (3) | — | % | ||||||||||||||||||||||||||
Adjustment to prior year taxes | (1) | — | % | 1 | — | % | (2) | — | % | ||||||||||||||||||||||||||
Tax benefit related to sale of Neon | — | — | % | (72) | (21 | %) | — | — | % | ||||||||||||||||||||||||||
Nondeductible expenses | 8 | 1 | % | 4 | 1 | % | 8 | 1 | % | ||||||||||||||||||||||||||
Foreign operations | — | — | % | 149 | 44 | % | 4 | 1 | % | ||||||||||||||||||||||||||
Other | 10 | — | % | 7 | 3 | % | 7 | — | % | ||||||||||||||||||||||||||
Provision for income taxes as shown in the statement of earnings | $ | 254 | 19 | % | $ | 25 | 7 | % | $ | 143 | 23 | % |
2019 | 2018 | 2017 | ||||||||||||||||||
Amount | % of EBT | Amount | % of EBT | Amount | % of EBT | |||||||||||||||
Earnings before income taxes (“EBT”) | $ | 1,108 | $ | 639 | $ | 724 | ||||||||||||||
Income taxes at statutory rate | $ | 233 | 21 | % | $ | 134 | 21 | % | $ | 253 | 35 | % | ||||||||
Effect of: | ||||||||||||||||||||
Tax exempt interest | (14 | ) | (1 | %) | (13 | ) | (2 | %) | (23 | ) | (3 | %) | ||||||||
Stock-based compensation | (8 | ) | (1 | %) | (8 | ) | (1 | %) | (16 | ) | (2 | %) | ||||||||
Dividend received deduction | (4 | ) | — | % | (4 | ) | (1 | %) | (8 | ) | (1 | %) | ||||||||
Adjustment to prior year taxes | (3 | ) | — | % | (8 | ) | (1 | %) | (4 | ) | (1 | %) | ||||||||
Employee stock ownership plan dividend paid deduction | (2 | ) | — | % | (3 | ) | (1 | %) | (5 | ) | (1 | %) | ||||||||
Change in valuation allowance (excluding change in tax rate) | 17 | 2 | % | 11 | 2 | % | (7 | ) | (1 | %) | ||||||||||
Nondeductible expenses | 8 | 1 | % | 7 | 1 | % | 6 | 1 | % | |||||||||||
Foreign operations | 4 | — | % | (2 | ) | — | % | 21 | 3 | % | ||||||||||
Neon restructuring | — | — | % | — | — | % | (56 | ) | (8 | %) | ||||||||||
Change in U.S corporate tax rate | — | — | % | — | — | % | 83 | 11 | % | |||||||||||
Other | 8 | — | % | 8 | 1 | % | 3 | 1 | % | |||||||||||
Provision for income taxes as shown in the statement of earnings | $ | 239 | 22 | % | $ | 122 | 19 | % | $ | 247 | 34 | % |
2019 | 2018 | 2017 | |||||||||
Current taxes: | |||||||||||
Federal | $ | 250 | $ | 196 | $ | 153 | |||||
State | 10 | 8 | 6 | ||||||||
Foreign | 2 | — | — | ||||||||
Deferred taxes: | |||||||||||
Federal | (23 | ) | (82 | ) | 5 | ||||||
Impact of change in U.S. corporate tax rate | — | — | 83 | ||||||||
Total Federal deferred taxes | (23 | ) | (82 | ) | 88 | ||||||
Provision for income taxes | $ | 239 | $ | 122 | $ | 247 |
2021 | 2020 | 2019 | |||||||||||||||
Current taxes: | |||||||||||||||||
Federal | $ | 162 | $ | 46 | $ | 103 | |||||||||||
State | 7 | 4 | 5 | ||||||||||||||
Foreign | 1 | 3 | 2 | ||||||||||||||
Deferred taxes: | |||||||||||||||||
Federal | 84 | (28) | 33 | ||||||||||||||
Provision for income taxes | $ | 254 | $ | 25 | $ | 143 |
Expiring | Amount | |||||
Operating Loss – U.S. | 2020 - 2022 | $ | 93 | |||
Operating Loss – United Kingdom | indefinite | 305 | (*) |
Expiring | Amount | ||||||||||||||
Operating Loss – U.S. | 2022 - 2041 | $ | 56 | ||||||||||||
Operating Loss – United Kingdom | indefinite | 37 | (*) |
2021 | 2020 | ||||||||||
Deferred tax assets: | |||||||||||
Federal net operating loss carryforwards | $ | 12 | $ | 15 | |||||||
Foreign underwriting losses | 9 | 6 | |||||||||
Capital loss carryforwards | — | 7 | |||||||||
Insurance claims and reserves | 249 | 240 | |||||||||
Employee benefits | 112 | 102 | |||||||||
Other, net | 26 | 45 | |||||||||
Total deferred tax assets before valuation allowance | 408 | 415 | |||||||||
Valuation allowance against deferred tax assets | (25) | (29) | |||||||||
Total deferred tax assets | 383 | 386 | |||||||||
Deferred tax liabilities: | |||||||||||
Investment securities | (200) | (129) | |||||||||
Deferred policy acquisition costs | (61) | (55) | |||||||||
Insurance claims and reserves transition liability | (17) | (21) | |||||||||
Real estate, property and equipment | (29) | (33) | |||||||||
Total deferred tax liabilities | (307) | (238) | |||||||||
Net deferred tax asset | $ | 76 | $ | 148 |
2019 | 2018 | ||||||||||||||||||||||
Excluding Unrealized Gains | Impact of Unrealized Gains | Total | Excluding Unrealized Gains | Impact of Unrealized Gains | Total | ||||||||||||||||||
Deferred tax assets: | |||||||||||||||||||||||
Federal net operating loss carryforwards | $ | 19 | $ | — | $ | 19 | $ | 23 | $ | — | $ | 23 | |||||||||||
Foreign underwriting losses | 118 | — | 118 | 93 | — | 93 | |||||||||||||||||
Insurance claims and reserves | 829 | 46 | 875 | 740 | 3 | 743 | |||||||||||||||||
Employee benefits | 93 | — | 93 | 88 | — | 88 | |||||||||||||||||
Other, net | 45 | (2 | ) | 43 | 44 | — | 44 | ||||||||||||||||
Total deferred tax assets before valuation allowance | 1,104 | 44 | 1,148 | 988 | 3 | 991 | |||||||||||||||||
Valuation allowance against deferred tax assets | (140 | ) | — | (140 | ) | (119 | ) | — | (119 | ) | |||||||||||||
Total deferred tax assets | 964 | 44 | 1,008 | 869 | 3 | 872 | |||||||||||||||||
Deferred tax liabilities: | |||||||||||||||||||||||
Investment securities | (140 | ) | (416 | ) | (556 | ) | (36 | ) | (34 | ) | (70 | ) | |||||||||||
Deferred policy acquisition costs | (293 | ) | 143 | (150 | ) | (300 | ) | 9 | (291 | ) | |||||||||||||
Insurance claims and reserves transition liability | (93 | ) | — | (93 | ) | (110 | ) | — | (110 | ) | |||||||||||||
Real estate, property and equipment | (35 | ) | — | (35 | ) | (36 | ) | — | (36 | ) | |||||||||||||
Total deferred tax liabilities | (561 | ) | (273 | ) | (834 | ) | (482 | ) | (25 | ) | (507 | ) | |||||||||||
Net deferred tax asset (liability) | $ | 403 | $ | (229 | ) | $ | 174 | $ | 387 | $ | (22 | ) | $ | 365 |
2019 | 2018 | 2017 | |||||||||
Balance at January 1 | $ | — | $ | — | $ | 1 | |||||
Additions for tax positions of prior years | — | — | — | ||||||||
Reductions for tax positions of prior years | — | — | — | ||||||||
Additions for tax positions of current year | — | — | — | ||||||||
Settlements | — | — | (1 | ) | |||||||
Balance at December 31 | $ | — | $ | — | $ | — |
1st Quarter | 2nd Quarter | 3rd Quarter | 4th Quarter | Total Year | ||||||||||||||||
2019 | ||||||||||||||||||||
Revenues | $ | 2,024 | $ | 1,960 | $ | 2,123 | $ | 2,130 | $ | 8,237 | ||||||||||
Net earnings, including noncontrolling interests | 326 | 209 | 143 | 191 | 869 | |||||||||||||||
Net earnings attributable to shareholders | 329 | 210 | 147 | 211 | 897 | |||||||||||||||
Earnings attributable to shareholders per Common Share: | ||||||||||||||||||||
Basic | $ | 3.68 | $ | 2.34 | $ | 1.64 | $ | 2.33 | $ | 9.98 | ||||||||||
Diluted | 3.63 | 2.31 | 1.62 | 2.30 | 9.85 | |||||||||||||||
Average number of Common Shares: | ||||||||||||||||||||
Basic | 89.4 | 89.7 | 90.0 | 90.2 | 89.9 | |||||||||||||||
Diluted | 90.7 | 91.0 | 91.1 | 91.3 | 91.0 | |||||||||||||||
2018 | ||||||||||||||||||||
Revenues | $ | 1,619 | $ | 1,833 | $ | 2,008 | $ | 1,690 | $ | 7,150 | ||||||||||
Net earnings (losses), including noncontrolling interests | 141 | 208 | 203 | (35 | ) | 517 | ||||||||||||||
Net earnings (losses) attributable to shareholders | 145 | 210 | 204 | (29 | ) | 530 | ||||||||||||||
Earnings (losses) attributable to shareholders per Common Share: | ||||||||||||||||||||
Basic | $ | 1.64 | $ | 2.36 | $ | 2.30 | $ | (0.33 | ) | $ | 5.95 | |||||||||
Diluted | 1.60 | 2.31 | 2.26 | (0.33 | ) | 5.85 | ||||||||||||||
Average number of Common Shares: | ||||||||||||||||||||
Basic | 88.6 | 89.0 | 89.1 | 89.3 | 89.0 | |||||||||||||||
Diluted | 90.4 | 90.7 | 90.7 | 89.3 | 90.6 |
1st Quarter | 2nd Quarter | 3rd Quarter | 4th Quarter | Total Year | ||||||||||||||||
2019 — change in fair value of equity securities | $ | 182 | $ | 44 | $ | (15 | ) | $ | 67 | $ | 278 | |||||||||
2019 — other realized gains (losses) | 2 | 12 | (3 | ) | (2 | ) | 9 | |||||||||||||
2018 — change in fair value of equity securities | (95 | ) | 23 | 33 | (223 | ) | (262 | ) | ||||||||||||
2018 — other realized gains (losses) | 2 | 8 | 1 | (15 | ) | (4 | ) |
1st Quarter | 2nd Quarter | 3rd Quarter | 4th Quarter | Total Year | ||||||||||||||||
2019 | $ | (11 | ) | $ | (33 | ) | $ | (27 | ) | $ | 24 | $ | (47 | ) | ||||||
2018 | 15 | (14 | ) | 17 | (66 | ) | (48 | ) |
1st Quarter | 2nd Quarter | 3rd Quarter | 4th Quarter | Total Year | ||||||||||||||||
2019 | $ | 45 | $ | 41 | $ | 12 | $ | 45 | $ | 143 | ||||||||||
2018 | 56 | 44 | 31 | 61 | 192 |
1st Quarter | 2nd Quarter | 3rd Quarter | 4th Quarter | Total Year | ||||||||||||||||
2019 | $ | (12 | ) | $ | (12 | ) | $ | (22 | ) | $ | (15 | ) | $ | (61 | ) | |||||
2018 | (13 | ) | (16 | ) | (38 | ) | (38 | ) | (105 | ) |
2019 | 2018 | 2017 | 2021 | 2020 | 2019 | |||||||||||||||||||||||
Balance at beginning of period | $ | 9,741 | $ | 9,678 | $ | 8,563 | Balance at beginning of period | $ | 10,392 | $ | 10,232 | $ | 9,741 | |||||||||||||||
Less reinsurance recoverables, net of allowance | 2,942 | 2,957 | 2,302 | Less reinsurance recoverables, net of allowance | 3,117 | 3,024 | 2,942 | |||||||||||||||||||||
Net liability at beginning of period | 6,799 | 6,721 | 6,261 | Net liability at beginning of period | 7,275 | 7,208 | 6,799 | |||||||||||||||||||||
Provision for losses and LAE occurring in the current year | 3,414 | 3,195 | 3,019 | Provision for losses and LAE occurring in the current year | 3,436 | 3,398 | 3,414 | |||||||||||||||||||||
Net increase (decrease) in the provision for claims of prior years: | Net increase (decrease) in the provision for claims of prior years: | |||||||||||||||||||||||||||
Special A&E charges | 18 | 18 | 89 | Special A&E charges | — | 47 | 18 | |||||||||||||||||||||
Neon exited lines charge | 7 | — | (18 | ) | ||||||||||||||||||||||||
Neon exited lines | Neon exited lines | — | 19 | 7 | ||||||||||||||||||||||||
Other | (168 | ) | (210 | ) | (135 | ) | Other | (279) | (193) | (168) | ||||||||||||||||||
Total losses and LAE incurred | 3,271 | 3,003 | 2,955 | Total losses and LAE incurred | 3,157 | 3,271 | 3,271 | |||||||||||||||||||||
Payments for losses and LAE of: | Payments for losses and LAE of: | |||||||||||||||||||||||||||
Current year | (1,076 | ) | (963 | ) | (942 | ) | Current year | (1,024) | (990) | (1,076) | ||||||||||||||||||
Prior years | (1,790 | ) | (1,639 | ) | (1,586 | ) | Prior years | (1,753) | (1,766) | (1,790) | ||||||||||||||||||
Total payments | (2,866 | ) | (2,602 | ) | (2,528 | ) | Total payments | (2,777) | (2,756) | (2,866) | ||||||||||||||||||
Reserves of businesses disposed (*) | — | (319 | ) | — | Reserves of businesses disposed (*) | — | (449) | — | ||||||||||||||||||||
Foreign currency translation and other | 4 | (4 | ) | 33 | Foreign currency translation and other | — | 1 | 4 | ||||||||||||||||||||
Net liability at end of period | 7,208 | 6,799 | 6,721 | Net liability at end of period | 7,655 | 7,275 | 7,208 | |||||||||||||||||||||
Add back reinsurance recoverables, net of allowance | 3,024 | 2,942 | 2,957 | Add back reinsurance recoverables, net of allowance | 3,419 | 3,117 | 3,024 | |||||||||||||||||||||
Gross unpaid losses and LAE included in the balance sheet | $ | 10,232 | $ | 9,741 | $ | 9,678 | Gross unpaid losses and LAE included in the balance sheet | $ | 11,074 | $ | 10,392 | $ | 10,232 |
2021 | |||||
Unpaid losses and allocated LAE, net of reinsurance: | |||||
Specialty | |||||
Property and transportation | $ | 1,318 | |||
Specialty casualty | 4,447 | ||||
Specialty financial | 256 | ||||
Other specialty | 434 | ||||
Total Specialty (excluding foreign reserves) | 6,455 | ||||
Other reserves | |||||
Foreign operations | 349 | ||||
A&E reserves | 408 | ||||
Unallocated LAE | 382 | ||||
Other | 61 | ||||
Total other reserves | 1,200 | ||||
Total reserves, net of reinsurance | 7,655 | ||||
Add back reinsurance recoverables, net of allowance | 3,419 | ||||
Gross unpaid losses and LAE included in the balance sheet | $ | 11,074 |
2019 | |||
Unpaid losses and allocated LAE, net of reinsurance: | |||
Specialty | |||
Property and transportation | $ | 1,171 | |
Specialty casualty | 4,056 | ||
Specialty financial | 221 | ||
Other specialty | 313 | ||
Total Specialty (excluding foreign reserves) | 5,761 | ||
Other reserves | |||
Reserves for foreign operations: | |||
Neon Lloyd’s business | 357 | ||
Other subsidiaries | 289 | ||
A&E reserves | 383 | ||
Unallocated LAE | 361 | ||
Other | 57 | ||
Total other reserves | 1,447 | ||
Total reserves, net of reinsurance | 7,208 | ||
Add back reinsurance recoverables, net of allowance | 3,024 | ||
Gross unpaid losses and LAE included in the balance sheet | $ | 10,232 |
Property and transportation | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(Dollars in Millions) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Incurred Claims and Allocated LAE, Net of Reinsurance | As of December 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
For the Years Ended (2012–2020 is Supplementary Information and Unaudited) | Total IBNR Plus Expected Development on Reported Claims | Cumulative Number of Reported Claims | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accident Year | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2012 | $ | 864 | $ | 857 | $ | 871 | $ | 883 | $ | 894 | $ | 890 | $ | 886 | $ | 881 | $ | 879 | $ | 877 | $ | 3 | 143,144 | |||||||||||||||||||||||||||||||||||||||||||||||||||
2013 | 882 | 870 | 872 | 878 | 878 | 877 | 873 | 871 | 870 | 5 | 138,947 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2014 | 844 | 828 | 817 | 820 | 815 | 808 | 804 | 802 | 6 | 133,218 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2015 | 818 | 784 | 779 | 777 | 777 | 772 | 768 | 9 | 134,923 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2016 | 746 | 716 | 714 | 706 | 694 | 688 | 15 | 121,191 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2017 | 889 | 847 | 843 | 823 | 816 | 19 | 140,714 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2018 | 932 | 902 | 886 | 876 | 35 | 130,271 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2019 | 1,111 | 1,058 | 1,051 | 65 | 153,560 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2020 | 1,043 | 974 | 138 | 120,696 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2021 | 1,119 | 397 | 108,153 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total | $ | 8,841 |
Cumulative Paid Claims and Allocated LAE, Net of Reinsurance | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accident Year | For the Years Ended (2012–2020 is Supplementary Information and Unaudited) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | % (a) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2012 | $ | 572 | $ | 708 | $ | 772 | $ | 816 | $ | 842 | $ | 856 | $ | 882 | $ | 869 | $ | 872 | $ | 873 | 99.5 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2013 | 438 | 702 | 760 | 804 | 831 | 847 | 858 | 860 | 861 | 99.0 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2014 | 329 | 632 | 693 | 744 | 770 | 783 | 789 | 791 | 98.6 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2015 | 359 | 582 | 667 | 707 | 736 | 744 | 750 | 97.7 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2016 | 294 | 521 | 577 | 618 | 640 | 656 | 95.3 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2017 | 379 | 640 | 696 | 735 | 755 | 92.5 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2018 | 396 | 676 | 738 | 781 | 89.2 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2019 | 527 | 823 | 904 | 86.0 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2020 | 461 | 726 | 74.5 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2021 | 449 | 40.1 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total | $ | 7,546 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Unpaid losses and LAE — years 2012 through 2021 | 1,295 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Unpaid losses and LAE — 11th year and prior (excluding unallocated LAE) | 23 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Unpaid losses and LAE, net of reinsurance (excluding unallocated LAE) | $ | 1,318 |
Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance (Supplementary Information and Unaudited) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | Year 10 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Annual | 47.5 | % | 29.4 | % | 7.8 | % | 5.3 | % | 3.1 | % | 1.7 | % | 1.4 | % | (0.3 | %) | 0.2 | % | 0.1 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Cumulative | 47.5 | % | 76.9 | % | 84.7 | % | 90.0 | % | 93.1 | % | 94.8 | % | 96.2 | % | 95.9 | % | 96.1 | % | 96.2 | % |
Property and transportation | |||||||||||||||||||||||||||||||||||||||||||||||
(Dollars in Millions) | |||||||||||||||||||||||||||||||||||||||||||||||
Incurred Claims and Allocated LAE, Net of Reinsurance | As of December 31, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||
For the Years Ended (2010–2018 is Supplementary Information and Unaudited) | Total IBNR Plus Expected Development on Reported Claims | Cumulative Number of Reported Claims | |||||||||||||||||||||||||||||||||||||||||||||
Accident Year | 2010 | 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | |||||||||||||||||||||||||||||||||||||
2010 | $ | 679 | $ | 639 | $ | 645 | $ | 652 | $ | 655 | $ | 655 | $ | 660 | $ | 657 | $ | 655 | $ | 655 | $ | 3 | 138,105 | ||||||||||||||||||||||||
2011 | 811 | 799 | 813 | 827 | 837 | 850 | 846 | 844 | 843 | 5 | 138,309 | ||||||||||||||||||||||||||||||||||||
2012 | 864 | 857 | 871 | 883 | 894 | 890 | 886 | 881 | 8 | 143,122 | |||||||||||||||||||||||||||||||||||||
2013 | 882 | 870 | 872 | 878 | 878 | 877 | 873 | 10 | 138,864 | ||||||||||||||||||||||||||||||||||||||
2014 | 844 | 828 | 817 | 820 | 815 | 808 | 15 | 132,971 | |||||||||||||||||||||||||||||||||||||||
2015 | 818 | 784 | 779 | 777 | 777 | 23 | 134,618 | ||||||||||||||||||||||||||||||||||||||||
2016 | 746 | 716 | 714 | 706 | 46 | 120,884 | |||||||||||||||||||||||||||||||||||||||||
2017 | 889 | 847 | 843 | 80 | 140,067 | ||||||||||||||||||||||||||||||||||||||||||
2018 | 932 | 902 | 119 | 128,428 | |||||||||||||||||||||||||||||||||||||||||||
2019 | 1,111 | 288 | 138,508 | ||||||||||||||||||||||||||||||||||||||||||||
Total | $ | 8,399 |
Cumulative Paid Claims and Allocated LAE, Net of Reinsurance | |||||||||||||||||||||||||||||||||||||||||||||
Accident Year | For the Years Ended (2010–2018 is Supplementary Information and Unaudited) | ||||||||||||||||||||||||||||||||||||||||||||
2010 | 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | % (a) | |||||||||||||||||||||||||||||||||||
2010 | $ | 316 | $ | 486 | $ | 535 | $ | 596 | $ | 626 | $ | 637 | $ | 642 | $ | 647 | $ | 649 | $ | 650 | 99.2 | % | |||||||||||||||||||||||
2011 | 365 | 667 | 727 | 771 | 803 | 821 | 829 | 833 | 834 | 98.9 | % | ||||||||||||||||||||||||||||||||||
2012 | 572 | 708 | 772 | 816 | 842 | 856 | 882 | 869 | 98.6 | % | |||||||||||||||||||||||||||||||||||
2013 | 438 | 702 | 760 | 804 | 831 | 847 | 858 | 98.3 | % | ||||||||||||||||||||||||||||||||||||
2014 | 329 | 632 | 693 | 744 | 770 | 783 | 96.9 | % | |||||||||||||||||||||||||||||||||||||
2015 | 359 | 582 | 667 | 707 | 736 | 94.7 | % | ||||||||||||||||||||||||||||||||||||||
2016 | 294 | 521 | 577 | 618 | 87.5 | % | |||||||||||||||||||||||||||||||||||||||
2017 | 379 | 640 | 696 | 82.6 | % | ||||||||||||||||||||||||||||||||||||||||
2018 | 396 | 676 | 74.9 | % | |||||||||||||||||||||||||||||||||||||||||
2019 | 527 | 47.4 | % | ||||||||||||||||||||||||||||||||||||||||||
Total | $ | 7,247 | |||||||||||||||||||||||||||||||||||||||||||
Unpaid losses and LAE — years 2010 through 2019 | 1,152 | ||||||||||||||||||||||||||||||||||||||||||||
Unpaid losses and LAE — 11th year and prior (excluding unallocated LAE) | 19 | ||||||||||||||||||||||||||||||||||||||||||||
Unpaid losses and LAE, net of reinsurance (excluding unallocated LAE) | $ | 1,171 |
Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance (Supplementary Information and Unaudited) | ||||||||||||||||||||||||||||||||||
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | Year 10 | |||||||||||||||||||||||||
Annual | 47.1 | % | 29.8 | % | 7.7 | % | 6.0 | % | 3.6 | % | 1.8 | % | 1.5 | % | (0.1 | %) | 0.2 | % | 0.2 | % | ||||||||||||||
Cumulative | 47.1 | % | 76.9 | % | 84.6 | % | 90.6 | % | 94.2 | % | 96.0 | % | 97.5 | % | 97.4 | % | 97.6 | % | 97.8 | % |
Specialty casualty | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(Dollars in Millions) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Incurred Claims and Allocated LAE, Net of Reinsurance | As of December 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
For the Years Ended (2012–2020 is Supplementary Information and Unaudited) | Total IBNR Plus Expected Development on Reported Claims | Cumulative Number of Reported Claims | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accident Year | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2012 | $ | 901 | $ | 892 | $ | 885 | $ | 885 | $ | 883 | $ | 877 | $ | 849 | $ | 842 | $ | 833 | $ | 826 | $ | 23 | 54,827 | |||||||||||||||||||||||||||||||||||||||||||||||||||
2013 | 968 | 949 | 945 | 940 | 945 | 926 | 916 | 905 | 898 | 35 | 55,128 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2014 | 1,035 | 1,008 | 1,008 | 1,006 | 982 | 967 | 952 | 950 | 50 | 56,942 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2015 | 1,081 | 1,043 | 1,041 | 1,042 | 1,024 | 1,021 | 1,015 | 67 | 58,076 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2016 | 1,131 | 1,122 | 1,116 | 1,101 | 1,090 | 1,069 | 124 | 56,407 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2017 | 1,211 | 1,221 | 1,204 | 1,189 | 1,162 | 200 | 56,975 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2018 | 1,277 | 1,307 | 1,302 | 1,262 | 297 | 58,808 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2019 | 1,308 | 1,311 | 1,322 | 442 | 58,304 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2020 | 1,352 | 1,329 | 631 | 52,733 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2021 | 1,384 | 907 | 48,149 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total | $ | 11,217 |
Cumulative Paid Claims and Allocated LAE, Net of Reinsurance | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accident Year | For the Years Ended (2012–2020 is Supplementary Information and Unaudited) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | % (a) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2012 | $ | 173 | $ | 385 | $ | 516 | $ | 621 | $ | 684 | $ | 723 | $ | 745 | $ | 761 | $ | 775 | $ | 783 | 94.8 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2013 | 182 | 396 | 554 | 666 | 729 | 766 | 797 | 820 | 835 | 93.0 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2014 | 190 | 412 | 574 | 680 | 755 | 801 | 829 | 862 | 90.7 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2015 | 178 | 411 | 577 | 702 | 792 | 844 | 888 | 87.5 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2016 | 186 | 418 | 584 | 713 | 806 | 870 | 81.4 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2017 | 200 | 422 | 612 | 755 | 833 | 71.7 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2018 | 210 | 475 | 649 | 794 | 62.9 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2019 | 212 | 455 | 651 | 49.2 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2020 | 188 | 446 | 33.6 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2021 | 191 | 13.8 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total | $ | 7,153 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Unpaid losses and LAE — years 2012 through 2021 | 4,064 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Unpaid losses and LAE — 11th year and prior (excluding unallocated LAE) | 383 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Unpaid losses and LAE, net of reinsurance (excluding unallocated LAE) | $ | 4,447 |
Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance (Supplementary Information and Unaudited) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | Year 10 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Annual | 17.4 | % | 21.7 | % | 15.9 | % | 12.1 | % | 7.8 | % | 5.0 | % | 3.3 | % | 2.7 | % | 1.7 | % | 1.0 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Cumulative | 17.4 | % | 39.1 | % | 55.0 | % | 67.1 | % | 74.9 | % | 79.9 | % | 83.2 | % | 85.9 | % | 87.6 | % | 88.6 | % |
Specialty casualty | |||||||||||||||||||||||||||||||||||||||||||||||
(Dollars in Millions) | |||||||||||||||||||||||||||||||||||||||||||||||
Incurred Claims and Allocated LAE, Net of Reinsurance | As of December 31, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||
For the Years Ended (2010–2018 is Supplementary Information and Unaudited) | Total IBNR Plus Expected Development on Reported Claims | Cumulative Number of Reported Claims | |||||||||||||||||||||||||||||||||||||||||||||
Accident Year | 2010 | 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | |||||||||||||||||||||||||||||||||||||
2010 | $ | 871 | $ | 887 | $ | 888 | $ | 867 | $ | 880 | $ | 870 | $ | 868 | $ | 866 | $ | 855 | $ | 846 | $ | 28 | 56,716 | ||||||||||||||||||||||||
2011 | 852 | 849 | 839 | 848 | 834 | 828 | 826 | 817 | 810 | 37 | 54,755 | ||||||||||||||||||||||||||||||||||||
2012 | 901 | 892 | 885 | 885 | 883 | 877 | 849 | 842 | 53 | 54,682 | |||||||||||||||||||||||||||||||||||||
2013 | 968 | 949 | 945 | 940 | 945 | 926 | 916 | 77 | 54,929 | ||||||||||||||||||||||||||||||||||||||
2014 | 1,035 | 1,008 | 1,008 | 1,006 | 982 | 967 | 98 | 56,445 | |||||||||||||||||||||||||||||||||||||||
2015 | 1,081 | 1,043 | 1,041 | 1,042 | 1,024 | 126 | 57,427 | ||||||||||||||||||||||||||||||||||||||||
2016 | 1,131 | 1,122 | 1,116 | 1,101 | 236 | 56,000 | |||||||||||||||||||||||||||||||||||||||||
2017 | 1,211 | 1,221 | 1,204 | 372 | 56,073 | ||||||||||||||||||||||||||||||||||||||||||
2018 | 1,277 | 1,307 | 548 | 57,081 | |||||||||||||||||||||||||||||||||||||||||||
2019 | 1,308 | 773 | 51,198 | ||||||||||||||||||||||||||||||||||||||||||||
Total | $ | 10,325 |
Cumulative Paid Claims and Allocated LAE, Net of Reinsurance | |||||||||||||||||||||||||||||||||||||||||||||
Accident Year | For the Years Ended (2010–2018 is Supplementary Information and Unaudited) | ||||||||||||||||||||||||||||||||||||||||||||
2010 | 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | % (a) | |||||||||||||||||||||||||||||||||||
2010 | $ | 191 | $ | 412 | $ | 560 | $ | 645 | $ | 700 | $ | 736 | $ | 757 | $ | 771 | $ | 783 | $ | 798 | 94.3 | % | |||||||||||||||||||||||
2011 | 174 | 383 | 522 | 612 | 662 | 694 | 714 | 731 | 745 | 92.0 | % | ||||||||||||||||||||||||||||||||||
2012 | 173 | 385 | 516 | 621 | 684 | 723 | 745 | 761 | 90.4 | % | |||||||||||||||||||||||||||||||||||
2013 | 182 | 396 | 554 | 666 | 729 | 766 | 797 | 87.0 | % | ||||||||||||||||||||||||||||||||||||
2014 | 190 | 412 | 574 | 680 | 755 | 801 | 82.8 | % | |||||||||||||||||||||||||||||||||||||
2015 | 178 | 411 | 577 | 702 | 792 | 77.3 | % | ||||||||||||||||||||||||||||||||||||||
2016 | 186 | 418 | 584 | 713 | 64.8 | % | |||||||||||||||||||||||||||||||||||||||
2017 | 200 | 422 | 612 | 50.8 | % | ||||||||||||||||||||||||||||||||||||||||
2018 | 210 | 475 | 36.3 | % | |||||||||||||||||||||||||||||||||||||||||
2019 | 212 | 16.2 | % | ||||||||||||||||||||||||||||||||||||||||||
Total | $ | 6,706 | |||||||||||||||||||||||||||||||||||||||||||
Unpaid losses and LAE — years 2010 through 2019 | 3,619 | ||||||||||||||||||||||||||||||||||||||||||||
Unpaid losses and LAE — 11th year and prior (excluding unallocated LAE) | 437 | ||||||||||||||||||||||||||||||||||||||||||||
Unpaid losses and LAE, net of reinsurance (excluding unallocated LAE) | $ | 4,056 |
Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance (Supplementary Information and Unaudited) | ||||||||||||||||||||||||||||||||||
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | Year 10 | |||||||||||||||||||||||||
Annual | 18.7 | % | 22.9 | % | 16.4 | % | 11.5 | % | 7.3 | % | 4.3 | % | 2.7 | % | 1.9 | % | 1.6 | % | 1.8 | % | ||||||||||||||
Cumulative | 18.7 | % | 41.6 | % | 58.0 | % | 69.5 | % | 76.8 | % | 81.1 | % | 83.8 | % | 85.7 | % | 87.3 | % | 89.1 | % |
Specialty financial | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(Dollars in Millions) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Incurred Claims and Allocated LAE, Net of Reinsurance | As of December 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
For the Years Ended (2012–2020 is Supplementary Information and Unaudited) | Total IBNR Plus Expected Development on Reported Claims | Cumulative Number of Reported Claims | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accident Year | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2012 | $ | 163 | $ | 163 | $ | 151 | $ | 139 | $ | 137 | $ | 135 | $ | 132 | $ | 127 | $ | 126 | $ | 125 | $ | 1 | 21,094 | |||||||||||||||||||||||||||||||||||||||||||||||||||
2013 | 140 | 145 | 137 | 131 | 127 | 126 | 122 | 122 | 120 | 1 | 28,475 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2014 | 146 | 157 | 156 | 153 | 147 | 142 | 137 | 136 | 1 | 29,466 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2015 | 156 | 160 | 158 | 153 | 145 | 138 | 136 | 2 | 37,626 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2016 | 179 | 184 | 187 | 182 | 174 | 170 | 4 | 45,157 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2017 | 212 | 215 | 212 | 208 | 203 | 8 | 48,781 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2018 | 212 | 217 | 219 | 207 | 15 | 46,697 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2019 | 194 | 198 | 191 | 23 | 41,735 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2020 | 231 | 215 | 49 | 29,254 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2021 | 223 | 110 | 23,349 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total | $ | 1,726 |
Cumulative Paid Claims and Allocated LAE, Net of Reinsurance | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accident Year | For the Years Ended (2012–2020 is Supplementary Information and Unaudited) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | % (a) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2012 | $ | 71 | $ | 104 | $ | 109 | $ | 117 | $ | 121 | $ | 126 | $ | 128 | $ | 126 | $ | 125 | $ | 125 | 100.0 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2013 | 70 | 100 | 107 | 113 | 117 | 117 | 118 | 118 | 118 | 98.3 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2014 | 62 | 109 | 125 | 128 | 137 | 139 | 141 | 140 | 102.9 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2015 | 72 | 110 | 129 | 133 | 132 | 134 | 134 | 98.5 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2016 | 88 | 141 | 158 | 161 | 163 | 164 | 96.5 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2017 | 120 | 169 | 186 | 194 | 193 | 95.1 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2018 | 112 | 163 | 187 | 188 | 90.8 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2019 | 99 | 146 | 164 | 85.9 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2020 | 100 | 144 | 67.0 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2021 | 98 | 43.9 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total | $ | 1,468 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Unpaid losses and LAE — years 2012 through 2021 | 258 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Unpaid losses and LAE — 11th year and prior (excluding unallocated LAE) | (2) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Unpaid losses and LAE, net of reinsurance (excluding unallocated LAE) | $ | 256 |
Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance (Supplementary Information and Unaudited) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | Year 10 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Annual | 52.1 | % | 26.5 | % | 9.4 | % | 3.2 | % | 2.2 | % | 1.5 | % | 1.0 | % | (0.8 | %) | (0.4 | %) | — | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Cumulative | 52.1 | % | 78.6 | % | 88.0 | % | 91.2 | % | 93.4 | % | 94.9 | % | 95.9 | % | 95.1 | % | 94.7 | % | 94.7 | % |
Specialty financial | |||||||||||||||||||||||||||||||||||||||||||||||
(Dollars in Millions) | |||||||||||||||||||||||||||||||||||||||||||||||
Incurred Claims and Allocated LAE, Net of Reinsurance | As of December 31, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||
For the Years Ended (2010–2018 is Supplementary Information and Unaudited) | Total IBNR Plus Expected Development on Reported Claims | Cumulative Number of Reported Claims | |||||||||||||||||||||||||||||||||||||||||||||
Accident Year | 2010 | 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | |||||||||||||||||||||||||||||||||||||
2010 | $ | 138 | $ | 145 | $ | 132 | $ | 132 | $ | 135 | $ | 133 | $ | 130 | $ | 127 | $ | 126 | $ | 126 | $ | 1 | 21,925 | ||||||||||||||||||||||||
2011 | 138 | 157 | 155 | 153 | 147 | 144 | 143 | 139 | 137 | — | 16,369 | ||||||||||||||||||||||||||||||||||||
2012 | 163 | 163 | 151 | 139 | 137 | 135 | 132 | 127 | 1 | 21,076 | |||||||||||||||||||||||||||||||||||||
2013 | 140 | 145 | 137 | 131 | 127 | 126 | 122 | 4 | 28,460 | ||||||||||||||||||||||||||||||||||||||
2014 | 146 | 157 | 156 | 153 | 147 | 142 | 5 | 29,436 | |||||||||||||||||||||||||||||||||||||||
2015 | 156 | 160 | 158 | 153 | 145 | 10 | 37,562 | ||||||||||||||||||||||||||||||||||||||||
2016 | 179 | 184 | 187 | 182 | 18 | 45,054 | |||||||||||||||||||||||||||||||||||||||||
2017 | 212 | 215 | 212 | 27 | 48,421 | ||||||||||||||||||||||||||||||||||||||||||
2018 | 212 | 217 | 30 | 46,198 | |||||||||||||||||||||||||||||||||||||||||||
2019 | 194 | 77 | 35,369 | ||||||||||||||||||||||||||||||||||||||||||||
Total | $ | 1,604 |
Cumulative Paid Claims and Allocated LAE, Net of Reinsurance | |||||||||||||||||||||||||||||||||||||||||||||
Accident Year | For the Years Ended (2010–2018 is Supplementary Information and Unaudited) | ||||||||||||||||||||||||||||||||||||||||||||
2010 | 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | % (a) | |||||||||||||||||||||||||||||||||||
2010 | $ | 61 | $ | 93 | $ | 104 | $ | 122 | $ | 132 | $ | 130 | $ | 128 | $ | 126 | $ | 126 | $ | 126 | 100.0 | % | |||||||||||||||||||||||
2011 | 58 | 111 | 115 | 123 | 130 | 131 | 131 | 132 | 132 | 96.4 | % | ||||||||||||||||||||||||||||||||||
2012 | 71 | 104 | 109 | 117 | 121 | 126 | 128 | 126 | 99.2 | % | |||||||||||||||||||||||||||||||||||
2013 | 70 | 100 | 107 | 113 | 117 | 117 | 118 | 96.7 | % | ||||||||||||||||||||||||||||||||||||
2014 | 62 | 109 | 125 | 128 | 137 | 139 | 97.9 | % | |||||||||||||||||||||||||||||||||||||
2015 | 72 | 110 | 129 | 133 | 132 | 91.0 | % | ||||||||||||||||||||||||||||||||||||||
2016 | 88 | 141 | 158 | 161 | 88.5 | % | |||||||||||||||||||||||||||||||||||||||
2017 | 120 | 169 | 186 | 87.7 | % | ||||||||||||||||||||||||||||||||||||||||
2018 | 112 | 163 | 75.1 | % | |||||||||||||||||||||||||||||||||||||||||
2019 | 99 | 51.0 | % | ||||||||||||||||||||||||||||||||||||||||||
Total | $ | 1,382 | |||||||||||||||||||||||||||||||||||||||||||
Unpaid losses and LAE — years 2010 through 2019 | 222 | ||||||||||||||||||||||||||||||||||||||||||||
Unpaid losses and LAE — 11th year and prior (excluding unallocated LAE) | (1 | ) | |||||||||||||||||||||||||||||||||||||||||||
Unpaid losses and LAE, net of reinsurance (excluding unallocated LAE) | $ | 221 |
Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance (Supplementary Information and Unaudited) | ||||||||||||||||||||||||||||||||||
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | Year 10 | |||||||||||||||||||||||||
Annual | 50.5 | % | 27.7 | % | 7.9 | % | 5.4 | % | 4.2 | % | 0.9 | % | 0.2 | % | (0.8 | %) | — | % | — | % | ||||||||||||||
Cumulative | 50.5 | % | 78.2 | % | 86.1 | % | 91.5 | % | 95.7 | % | 96.6 | % | 96.8 | % | 96.0 | % | 96.0 | % | 96.0 | % |
Other specialty | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(Dollars in Millions) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Incurred Claims and Allocated LAE, Net of Reinsurance | As of December 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
For the Years Ended (2012–2020 is Supplementary Information and Unaudited) | Total IBNR Plus Expected Development on Reported Claims | Cumulative Number of Reported Claims (a) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accident Year | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2012 | $ | 42 | $ | 40 | $ | 39 | $ | 40 | $ | 41 | $ | 39 | $ | 39 | $ | 36 | $ | 37 | $ | 38 | $ | 2 | — | |||||||||||||||||||||||||||||||||||||||||||||||||||
2013 | 46 | 47 | 46 | 47 | 50 | 53 | 58 | 58 | 60 | 1 | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2014 | 58 | 57 | 59 | 59 | 60 | 61 | 64 | 66 | 7 | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2015 | 59 | 60 | 63 | 66 | 76 | 82 | 84 | 7 | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2016 | 61 | 61 | 65 | 71 | 76 | 77 | 13 | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2017 | 63 | 65 | 70 | 81 | 88 | 12 | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2018 | 86 | 90 | 92 | 94 | 35 | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2019 | 108 | 107 | 108 | 44 | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2020 | 122 | 117 | 80 | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2021 | 135 | 117 | — | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total | $ | 867 |
Cumulative Paid Claims and Allocated LAE, Net of Reinsurance | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accident Year | For the Years Ended (2012–2020 is Supplementary Information and Unaudited) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | % (b) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2012 | $ | 8 | $ | 17 | $ | 21 | $ | 25 | $ | 28 | $ | 30 | $ | 30 | $ | 32 | $ | 33 | $ | 34 | 89.5 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2013 | 7 | 16 | 22 | 34 | 37 | 44 | 51 | 53 | 57 | 95.0 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2014 | 13 | 21 | 30 | 36 | 43 | 50 | 53 | 54 | 81.8 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2015 | 10 | 26 | 31 | 50 | 62 | 69 | 75 | 89.3 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2016 | 9 | 19 | 31 | 47 | 53 | 60 | 77.9 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2017 | 10 | 19 | 30 | 52 | 63 | 71.6 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2018 | 12 | 23 | 32 | 44 | 46.8 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2019 | 9 | 24 | 49 | 45.4 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2020 | 9 | 21 | 17.9 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2021 | 8 | 5.9 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total | $ | 465 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Unpaid losses and LAE — years 2012 through 2021 | 402 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Unpaid losses and LAE — 11th year and prior (excluding unallocated LAE) | 32 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Unpaid losses and LAE, net of reinsurance (excluding unallocated LAE) | $ | 434 |
Other specialty | |||||||||||||||||||||||||||||||||||||||||||||||
(Dollars in Millions) | |||||||||||||||||||||||||||||||||||||||||||||||
Incurred Claims and Allocated LAE, Net of Reinsurance | As of December 31, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||
For the Years Ended (2010–2018 is Supplementary Information and Unaudited) | Total IBNR Plus Expected Development on Reported Claims | Cumulative Number of Reported Claims (a) | |||||||||||||||||||||||||||||||||||||||||||||
Accident Year | 2010 | 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | |||||||||||||||||||||||||||||||||||||
2010 | $ | 36 | $ | 39 | $ | 40 | $ | 39 | $ | 40 | $ | 40 | $ | 40 | $ | 40 | $ | 40 | $ | 39 | $ | 1 | — | ||||||||||||||||||||||||
2011 | 39 | 43 | 42 | 43 | 43 | 44 | 44 | 43 | 42 | 1 | — | ||||||||||||||||||||||||||||||||||||
2012 | 42 | 40 | 39 | 40 | 41 | 39 | 39 | 36 | 2 | — | |||||||||||||||||||||||||||||||||||||
2013 | 46 | 47 | 46 | 47 | 50 | 53 | 58 | 3 | — | ||||||||||||||||||||||||||||||||||||||
2014 | 58 | 57 | 59 | 59 | 60 | 61 | 6 | — | |||||||||||||||||||||||||||||||||||||||
2015 | 59 | 60 | 63 | 66 | 76 | 3 | — | ||||||||||||||||||||||||||||||||||||||||
2016 | 61 | 61 | 65 | 71 | 15 | — | |||||||||||||||||||||||||||||||||||||||||
2017 | 63 | 65 | 70 | 23 | — | ||||||||||||||||||||||||||||||||||||||||||
2018 | 86 | 90 | 53 | — | |||||||||||||||||||||||||||||||||||||||||||
2019 | 108 | 87 | — | ||||||||||||||||||||||||||||||||||||||||||||
Total | $ | 651 |
Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance (Supplementary Information and Unaudited) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | Year 10 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Annual | 12.2 | % | 14.3 | % | 12.6 | % | 17.3 | % | 9.7 | % | 9.0 | % | 5.8 | % | 3.4 | % | 4.6 | % | 2.6 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Cumulative | 12.2 | % | 26.5 | % | 39.1 | % | 56.4 | % | 66.1 | % | 75.1 | % | 80.9 | % | 84.3 | % | 88.9 | % | 91.5 | % |
Cumulative Paid Claims and Allocated LAE, Net of Reinsurance | |||||||||||||||||||||||||||||||||||||||||||||
Accident Year | For the Years Ended (2010–2018 is Supplementary Information and Unaudited) | ||||||||||||||||||||||||||||||||||||||||||||
2010 | 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | % (b) | |||||||||||||||||||||||||||||||||||
2010 | $ | 8 | $ | 14 | $ | 21 | $ | 24 | $ | 27 | $ | 33 | $ | 35 | $ | 36 | $ | 37 | $ | 37 | 94.9 | % | |||||||||||||||||||||||
2011 | 12 | 20 | 25 | 28 | 34 | 36 | 37 | 38 | 39 | 92.9 | % | ||||||||||||||||||||||||||||||||||
2012 | 8 | 17 | 21 | 25 | 28 | 30 | 30 | 32 | 88.9 | % | |||||||||||||||||||||||||||||||||||
2013 | 7 | 16 | 22 | 34 | 37 | 44 | 51 | 87.9 | % | ||||||||||||||||||||||||||||||||||||
2014 | 13 | 21 | 30 | 36 | 43 | 50 | 82.0 | % | |||||||||||||||||||||||||||||||||||||
2015 | 10 | 26 | 31 | 50 | 62 | 81.6 | % | ||||||||||||||||||||||||||||||||||||||
2016 | 9 | 19 | 31 | 47 | 66.2 | % | |||||||||||||||||||||||||||||||||||||||
2017 | 10 | 19 | 30 | 42.9 | % | ||||||||||||||||||||||||||||||||||||||||
2018 | 12 | 23 | 25.6 | % | |||||||||||||||||||||||||||||||||||||||||
2019 | 9 | 8.3 | % | ||||||||||||||||||||||||||||||||||||||||||
Total | $ | 380 | |||||||||||||||||||||||||||||||||||||||||||
Unpaid losses and LAE — years 2010 through 2019 | 271 | ||||||||||||||||||||||||||||||||||||||||||||
Unpaid losses and LAE — 11th year and prior (excluding unallocated LAE) | 42 | ||||||||||||||||||||||||||||||||||||||||||||
Unpaid losses and LAE, net of reinsurance (excluding unallocated LAE) | $ | 313 |
Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance (Supplementary Information and Unaudited) | ||||||||||||||||||||||||||||||||||
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | Year 10 | |||||||||||||||||||||||||
Annual | 16.6 | % | 16.5 | % | 13.2 | % | 14.9 | % | 10.5 | % | 9.8 | % | 4.9 | % | 3.5 | % | 2.5 | % | — | % | ||||||||||||||
Cumulative | 16.6 | % | 33.1 | % | 46.3 | % | 61.2 | % | 71.7 | % | 81.5 | % | 86.4 | % | 89.9 | % | 92.4 | % | 92.4 | % |
Total Specialty Group | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(Dollars in Millions) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Incurred Claims and Allocated LAE, Net of Reinsurance | As of December 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
For the Years Ended (2012–2020 is Supplementary Information and Unaudited) | Total IBNR Plus Expected Development on Reported Claims | Cumulative Number of Reported Claims | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accident Year | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2012 | $ | 1,970 | $ | 1,952 | $ | 1,946 | $ | 1,947 | $ | 1,955 | $ | 1,941 | $ | 1,906 | $ | 1,886 | $ | 1,875 | $ | 1,866 | $ | 29 | 219,065 | |||||||||||||||||||||||||||||||||||||||||||||||||||
2013 | 2,036 | 2,011 | 2,000 | 1,996 | 2,000 | 1,982 | 1,969 | 1,956 | 1,948 | 42 | 222,550 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2014 | 2,083 | 2,050 | 2,040 | 2,038 | 2,004 | 1,978 | 1,957 | 1,954 | 64 | 219,626 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2015 | 2,114 | 2,047 | 2,041 | 2,038 | 2,022 | 2,013 | 2,003 | 85 | 230,625 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2016 | 2,117 | 2,083 | 2,082 | 2,060 | 2,034 | 2,004 | 156 | 222,755 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2017 | 2,375 | 2,348 | 2,329 | 2,301 | 2,269 | 239 | 246,470 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2018 | 2,507 | 2,516 | 2,499 | 2,439 | 382 | 235,776 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2019 | 2,721 | 2,674 | 2,672 | 574 | 253,599 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2020 | 2,748 | 2,635 | 898 | 202,683 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2021 | 2,861 | 1,531 | 179,651 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total | $ | 22,651 |
Cumulative Paid Claims and Allocated LAE, Net of Reinsurance | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accident Year | For the Years Ended (2012–2020 is Supplementary Information and Unaudited) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | % (a) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2012 | $ | 824 | $ | 1,214 | $ | 1,418 | $ | 1,579 | $ | 1,675 | $ | 1,735 | $ | 1,785 | $ | 1,788 | $ | 1,805 | $ | 1,815 | 97.3 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||
2013 | 697 | 1,214 | 1,443 | 1,617 | 1,714 | 1,774 | 1,824 | 1,851 | 1,871 | 96.0 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2014 | 594 | 1,174 | 1,422 | 1,588 | 1,705 | 1,773 | 1,812 | 1,847 | 94.5 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2015 | 619 | 1,129 | 1,404 | 1,592 | 1,722 | 1,791 | 1,847 | 92.2 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2016 | 577 | 1,099 | 1,350 | 1,539 | 1,662 | 1,750 | 87.3 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2017 | 709 | 1,250 | 1,524 | 1,736 | 1,844 | 81.3 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2018 | 730 | 1,337 | 1,606 | 1,807 | 74.1 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2019 | 847 | 1,448 | 1,768 | 66.2 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2020 | 758 | 1,337 | 50.7 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2021 | 746 | 26.1 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Total | $ | 16,632 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Unpaid losses and LAE — years 2012 through 2021 | 6,019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Unpaid losses and LAE — 11th year and prior (excluding unallocated LAE) | 436 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Unpaid losses and LAE, net of reinsurance (excluding unallocated LAE) | $ | 6,455 |
Total Specialty Group | |||||||||||||||||||||||||||||||||||||||||||||||
(Dollars in Millions) | |||||||||||||||||||||||||||||||||||||||||||||||
Incurred Claims and Allocated LAE, Net of Reinsurance | As of December 31, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||
For the Years Ended (2010–2018 is Supplementary Information and Unaudited) | Total IBNR Plus Expected Development on Reported Claims | Cumulative Number of Reported Claims | |||||||||||||||||||||||||||||||||||||||||||||
Accident Year | 2010 | 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | |||||||||||||||||||||||||||||||||||||
2010 | $ | 1,724 | $ | 1,710 | $ | 1,705 | $ | 1,690 | $ | 1,710 | $ | 1,698 | $ | 1,698 | $ | 1,690 | $ | 1,676 | $ | 1,666 | $ | 33 | 216,746 | ||||||||||||||||||||||||
2011 | 1,840 | 1,848 | 1,849 | 1,871 | 1,861 | 1,866 | 1,859 | 1,843 | 1,832 | 43 | 209,433 | ||||||||||||||||||||||||||||||||||||
2012 | 1,970 | 1,952 | 1,946 | 1,947 | 1,955 | 1,941 | 1,906 | 1,886 | 64 | 218,880 | |||||||||||||||||||||||||||||||||||||
2013 | 2,036 | 2,011 | 2,000 | 1,996 | 2,000 | 1,982 | 1,969 | 94 | 222,253 | ||||||||||||||||||||||||||||||||||||||
2014 | 2,083 | 2,050 | 2,040 | 2,038 | 2,004 | 1,978 | 124 | 218,852 | |||||||||||||||||||||||||||||||||||||||
2015 | 2,114 | 2,047 | 2,041 | 2,038 | 2,022 | 162 | 229,607 | ||||||||||||||||||||||||||||||||||||||||
2016 | 2,117 | 2,083 | 2,082 | 2,060 | 315 | 221,938 | |||||||||||||||||||||||||||||||||||||||||
2017 | 2,375 | 2,348 | 2,329 | 502 | 244,561 | ||||||||||||||||||||||||||||||||||||||||||
2018 | 2,507 | 2,516 | 750 | 231,707 | |||||||||||||||||||||||||||||||||||||||||||
2019 | 2,721 | 1,225 | 225,075 | ||||||||||||||||||||||||||||||||||||||||||||
Total | $ | 20,979 |
Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance (Supplementary Information and Unaudited) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | Year 10 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Annual | 31.8 | % | 24.6 | % | 12.1 | % | 8.9 | % | 5.6 | % | 3.5 | % | 2.5 | % | 1.1 | % | 1.0 | % | 0.5 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Cumulative | 31.8 | % | 56.4 | % | 68.5 | % | 77.4 | % | 83.0 | % | 86.5 | % | 89.0 | % | 90.1 | % | 91.1 | % | 91.6 | % |
Cumulative Paid Claims and Allocated LAE, Net of Reinsurance | |||||||||||||||||||||||||||||||||||||||||||||
Accident Year | For the Years Ended (2010–2018 is Supplementary Information and Unaudited) | ||||||||||||||||||||||||||||||||||||||||||||
2010 | 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | % (a) | |||||||||||||||||||||||||||||||||||
2010 | $ | 576 | $ | 1,005 | $ | 1,220 | $ | 1,387 | $ | 1,485 | $ | 1,536 | $ | 1,562 | $ | 1,580 | $ | 1,595 | $ | 1,611 | 96.7 | % | |||||||||||||||||||||||
2011 | 609 | 1,181 | 1,389 | 1,534 | 1,629 | 1,682 | 1,711 | 1,734 | 1,750 | 95.5 | % | ||||||||||||||||||||||||||||||||||
2012 | 824 | 1,214 | 1,418 | 1,579 | 1,675 | 1,735 | 1,785 | 1,788 | 94.8 | % | |||||||||||||||||||||||||||||||||||
2013 | 697 | 1,214 | 1,443 | 1,617 | 1,714 | 1,774 | 1,824 | 92.6 | % | ||||||||||||||||||||||||||||||||||||
2014 | 594 | 1,174 | 1,422 | 1,588 | 1,705 | 1,773 | 89.6 | % | |||||||||||||||||||||||||||||||||||||
2015 | 619 | 1,129 | 1,404 | 1,592 | 1,722 | 85.2 | % | ||||||||||||||||||||||||||||||||||||||
2016 | 577 | 1,099 | 1,350 | 1,539 | 74.7 | % | |||||||||||||||||||||||||||||||||||||||
2017 | 709 | 1,250 | 1,524 | 65.4 | % | ||||||||||||||||||||||||||||||||||||||||
2018 | 730 | 1,337 | 53.1 | % | |||||||||||||||||||||||||||||||||||||||||
2019 | 847 | 31.1 | % | ||||||||||||||||||||||||||||||||||||||||||
Total | $ | 15,715 | |||||||||||||||||||||||||||||||||||||||||||
Unpaid losses and LAE — years 2010 through 2019 | 5,264 | ||||||||||||||||||||||||||||||||||||||||||||
Unpaid losses and LAE — 11th year and prior (excluding unallocated LAE) | 497 | ||||||||||||||||||||||||||||||||||||||||||||
Unpaid losses and LAE, net of reinsurance (excluding unallocated LAE) | $ | 5,761 |
Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance (Supplementary Information and Unaudited) | ||||||||||||||||||||||||||||||||||
Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 | Year 8 | Year 9 | Year 10 | |||||||||||||||||||||||||
Annual | 32.6 | % | 25.7 | % | 12.1 | % | 8.9 | % | 5.6 | % | 3.1 | % | 2.1 | % | 0.8 | % | 0.9 | % | 1.0 | % | ||||||||||||||
Cumulative | 32.6 | % | 58.3 | % | 70.4 | % | 79.3 | % | 84.9 | % | 88.0 | % | 90.1 | % | 90.9 | % | 91.8 | % | 92.8 | % |
(a)Represents the cumulative percentage paid of incurred claims and allocated LAE (net of reinsurance, as estimated |
Net Earnings | Capital and Surplus | ||||||||||||||||||||||||||||
2021 | 2020 | 2019 | 2021 | 2020 | |||||||||||||||||||||||||
Property and casualty companies | $ | 1,007 | $ | 481 | $ | 584 | $ | 4,221 | $ | 3,643 |
Net Earnings | Capital and Surplus | ||||||||||||||||||
2019 | 2018 | 2017 | 2019 | 2018 | |||||||||||||||
Property and casualty companies | $ | 584 | $ | 546 | $ | 484 | $ | 3,342 | $ | 2,867 | |||||||||
Life (annuity) insurance companies | 34 | 802 | 286 | 2,868 | 2,701 |
2021 | 2020 | 2019 | |||||||||||||||
Direct premiums written | $ | 7,700 | $ | 6,862 | $ | 7,044 | |||||||||||
Reinsurance assumed | 246 | 225 | 255 | ||||||||||||||
Reinsurance ceded | (2,373) | (2,074) | (1,957) | ||||||||||||||
Net written premiums | $ | 5,573 | $ | 5,013 | $ | 5,342 | |||||||||||
Direct premiums earned | $ | 7,462 | $ | 6,846 | $ | 6,848 | |||||||||||
Reinsurance assumed | 249 | 237 | 226 | ||||||||||||||
Reinsurance ceded | (2,307) | (1,984) | (1,889) | ||||||||||||||
Net earned premiums | $ | 5,404 | $ | 5,099 | $ | 5,185 | |||||||||||
Reinsurance recoveries | $ | 1,478 | $ | 1,522 | $ | 1,404 |
2019 | 2018 | 2017 | |||||||||
Direct premiums written | $ | 7,044 | $ | 6,626 | $ | 6,310 | |||||
Reinsurance assumed | 255 | 214 | 192 | ||||||||
Reinsurance ceded | (1,957 | ) | (1,817 | ) | (1,751 | ) | |||||
Net written premiums | $ | 5,342 | $ | 5,023 | $ | 4,751 | |||||
Direct premiums earned | $ | 6,848 | $ | 6,472 | $ | 6,112 | |||||
Reinsurance assumed | 226 | 204 | 157 | ||||||||
Reinsurance ceded | (1,889 | ) | (1,811 | ) | (1,690 | ) | |||||
Net earned premiums | $ | 5,185 | $ | 4,865 | $ | 4,579 | |||||
Reinsurance recoveries | $ | 1,404 | $ | 1,249 | $ | 1,379 |
2019 | 2018 | ||||||
Expected death and annuitization | $ | 232 | $ | 229 | |||
Guaranteed withdrawal benefits | 625 | 472 | |||||
Accrued persistency and premium bonuses | 1 | 1 |
Recoverables from Reinsurers | Premiums Receivable | ||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
Balance at January 1 | $ | 6 | $ | 18 | $ | 10 | $ | 13 | |||||||||||||||
Impact of adoption of new accounting policy | — | (11) | — | (3) | |||||||||||||||||||
Provision for expected credit losses | 2 | — | (2) | 1 | |||||||||||||||||||
Write-offs charged against the allowance | — | — | — | (1) | |||||||||||||||||||
Businesses disposed | — | (1) | — | — | |||||||||||||||||||
Balance at December 31 | $ | 8 | $ | 6 | $ | 8 | $ | 10 |
ITEM 10 | Directors, Executive Officers of the Registrant and Corporate Governance | ||||
ITEM 11 | Executive Compensation | ||||
ITEM 12 | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters | ||||
ITEM 13 | Certain Relationships and Related Transactions, and Director Independence | ||||
ITEM 14 | Principal Accountant Fees and Services |
(a) | Documents filed as part of this Report: | |||||||||||||||||||
1. | Financial Statements are included in Part II, Item 8. | |||||||||||||||||||
2. | Financial Statement Schedules: | |||||||||||||||||||
Schedules filed herewith for | ||||||||||||||||||||
Page | ||||||||||||||||||||
II — Condensed Financial Information of Registrant | ||||||||||||||||||||
III — Supplementary Insurance Information | ||||||||||||||||||||
All other schedules for which provisions are made in the applicable regulation of the Securities and Exchange Commission have been omitted as they are not applicable, not required, or the information required thereby is set forth in the Financial Statements or the notes thereto. | ||||||||||||||||||||
3. | Exhibits — See Exhibit Index on the next page. | |||||||||||||||||||
Number | Exhibit Description | |||||||||||||||||||
Stock Purchase Agreement, dated as of January 27, 2021, by and among Massachusetts Mutual Life Insurance Company, Great American Financial Resources, Inc. and American Financial Group, Inc., filed as Exhibit 2.1 to the Form 8-K filed on January 28, 2021. | (*) | |||||||||||||||||||
Amended and Restated Articles of | (*) | |||||||||||||||||||
Amended and Restated Code of Regulations, filed as Exhibit | (*) | |||||||||||||||||||
4 | Instruments defining the rights of security holders. | Registrant has no outstanding debt issues exceeding 10% of the assets of Registrant and consolidated subsidiaries. | ||||||||||||||||||
Material Contracts: | ||||||||||||||||||||
Amended and Restated Non-Employee Directors Compensation Plan, filed as Exhibit 10 to the Form S-8 Registration Statement (File No. 333-184913) filed by AFG on November 13, 2012. | (*) | |||||||||||||||||||
Amended and Restated Deferred Compensation Plan, filed as Exhibit 10(b) to AFG’s Form 10-K for 2008. | (*) | |||||||||||||||||||
Annual Senior Executive Bonus Plan, filed as Exhibit 10(d) to AFG’s 10-K for 2017. | (*) | |||||||||||||||||||
Amended and | (*) | |||||||||||||||||||
2005 Stock Incentive Plan Exhibit 10 to the Form S-8 Registration Statement (File No. 333-184914) filed by AFG on November 13, 2012. | (*) | |||||||||||||||||||
2015 Stock Incentive Plan filed as Exhibit 10(g) to AFG’s Form 10-K for 2015. | (*) | |||||||||||||||||||
Senior Executive Long Term Incentive Compensation Plan, filed as Appendix A to AFG’s Proxy Statement filed on April 1, 2016. | (*) | |||||||||||||||||||
Credit Agreement dated | (*) | |||||||||||||||||||
Subsidiaries of the Registrant. | ||||||||||||||||||||
Consent of independent registered public accounting firm. | ||||||||||||||||||||
Certification of Co-Chief Executive Officer pursuant to Section 302(a) of the Sarbanes-Oxley Act of 2002. | ||||||||||||||||||||
Certification of Co-Chief Executive Officer pursuant to Section 302(a) of the Sarbanes-Oxley Act of 2002. | ||||||||||||||||||||
Certification of Chief Financial Officer pursuant to Section 302(a) of the Sarbanes-Oxley Act of 2002. | ||||||||||||||||||||
Certification of Co-Chief Executive Officers and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | ||||||||||||||||||||
101.INS | XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. | |||||||||||||||||||
101.SCH | Inline XBRL Taxonomy Extension Schema Document. | |||||||||||||||||||
101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document. | |||||||||||||||||||
101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document. | |||||||||||||||||||
101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document. | |||||||||||||||||||
101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document. | |||||||||||||||||||
104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). | |||||||||||||||||||
(*) Incorporated herein by reference. |
December 31, | |||||||||||
2021 | 2020 | ||||||||||
Assets: | |||||||||||
Cash and cash equivalents | $ | 589 | $ | 215 | |||||||
Investment in securities | 1,281 | 80 | |||||||||
Investment in subsidiaries (a) | 5,334 | 8,525 | |||||||||
Other investments | 2 | 2 | |||||||||
Other assets | 103 | 213 | |||||||||
Total assets | $ | 7,309 | $ | 9,035 | |||||||
Liabilities and Equity: | |||||||||||
Long-term debt | $ | 1,964 | $ | 1,963 | |||||||
Other liabilities | 333 | 283 | |||||||||
Shareholders’ equity | 5,012 | 6,789 | |||||||||
Total liabilities and equity | $ | 7,309 | $ | 9,035 |
December 31, | |||||||
2019 | 2018 | ||||||
Assets: | |||||||
Cash and cash equivalents | $ | 166 | $ | 158 | |||
Investment in securities | 77 | 65 | |||||
Investment in subsidiaries (a) | 7,623 | 6,155 | |||||
Other investments | 2 | 2 | |||||
Other assets | 143 | 68 | |||||
Total assets | $ | 8,011 | $ | 6,448 | |||
Liabilities and Equity: | |||||||
Long-term debt | $ | 1,473 | $ | 1,302 | |||
Other liabilities | 269 | 176 | |||||
Shareholders’ equity | 6,269 | 4,970 | |||||
Total liabilities and equity | $ | 8,011 | $ | 6,448 |
Year ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Revenues: | |||||||||||||||||
Dividends from subsidiaries | $ | 835 | $ | 543 | $ | 417 | |||||||||||
Equity in undistributed earnings of subsidiaries | 1,721 | 474 | 888 | ||||||||||||||
Investment and other income | 29 | 32 | 20 | ||||||||||||||
Total revenues | 2,585 | 1,049 | 1,325 | ||||||||||||||
Costs and Expenses: | |||||||||||||||||
Interest charges on intercompany borrowings | 7 | 8 | 8 | ||||||||||||||
Interest charges on other borrowings | 94 | 88 | 68 | ||||||||||||||
Other expenses | 129 | 94 | 113 | ||||||||||||||
Total costs and expenses | 230 | 190 | 189 | ||||||||||||||
Earnings before income taxes | 2,355 | 859 | 1,136 | ||||||||||||||
Provision for income taxes | 360 | 127 | 239 | ||||||||||||||
Net Earnings Attributable to Shareholders | $ | 1,995 | $ | 732 | $ | 897 |
Year ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Revenues: | |||||||||||
Dividends from subsidiaries | $ | 417 | $ | 261 | $ | 681 | |||||
Equity in undistributed earnings of subsidiaries | 888 | 529 | 264 | ||||||||
Investment and other income | 20 | 2 | 13 | ||||||||
Total revenues | 1,325 | 792 | 958 | ||||||||
Costs and Expenses: | |||||||||||
Interest charges on intercompany borrowings | 8 | 8 | 9 | ||||||||
Interest charges on other borrowings | 68 | 62 | 85 | ||||||||
Other expenses | 113 | 70 | 142 | ||||||||
Total costs and expenses | 189 | 140 | 236 | ||||||||
Earnings before income taxes | 1,136 | 652 | 722 | ||||||||
Provision for income taxes | 239 | 122 | 247 | ||||||||
Net Earnings Attributable to Shareholders | $ | 897 | $ | 530 | $ | 475 |
Year ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Net earnings attributable to shareholders | $ | 1,995 | $ | 732 | $ | 897 | |||||||||||
Other comprehensive income (loss), net of tax | (1,154) | 414 | 815 | ||||||||||||||
Total comprehensive income (loss), net of tax | $ | 841 | $ | 1,146 | $ | 1,712 |
Net earnings attributable to shareholders | $ | 897 | $ | 530 | $ | 475 | |||||
Other comprehensive income (loss), net of tax | 815 | (544 | ) | 296 | |||||||
Total comprehensive income (loss), net of tax | $ | 1,712 | $ | (14 | ) | $ | 771 |
Year ended December 31, | |||||||||||||||||
2021 | 2020 | 2019 | |||||||||||||||
Operating Activities: | |||||||||||||||||
Net earnings attributable to shareholders | $ | 1,995 | $ | 732 | $ | 897 | |||||||||||
Adjustments: | |||||||||||||||||
Equity in net earnings of subsidiaries | (2,144) | (780) | (1,032) | ||||||||||||||
Dividends from subsidiaries | 830 | 543 | 408 | ||||||||||||||
Other operating activities, net | 152 | (12) | 33 | ||||||||||||||
Net cash provided by operating activities | 833 | 483 | 306 | ||||||||||||||
Investing Activities: | |||||||||||||||||
Capital contributions to subsidiaries | (107) | (297) | (60) | ||||||||||||||
Returns of capital from subsidiaries | 3 | — | 4 | ||||||||||||||
Purchases of: | |||||||||||||||||
Investments, property and equipment | (1,478) | (2) | (3) | ||||||||||||||
Businesses | (120) | — | — | ||||||||||||||
Proceeds from: | |||||||||||||||||
Maturities and redemptions of investments | 277 | 2 | 3 | ||||||||||||||
Sales of investments, property and equipment | 11 | — | — | ||||||||||||||
Sales of businesses | 3,581 | 3 | — | ||||||||||||||
Net cash provided by (used in) investing activities | 2,167 | (294) | (56) | ||||||||||||||
Financing Activities: | |||||||||||||||||
Additional long-term borrowings | — | 634 | 315 | ||||||||||||||
Reductions of long-term debt | — | (150) | (150) | ||||||||||||||
Issuances of Common Stock | 67 | 23 | 37 | ||||||||||||||
Repurchases of Common Stock | (319) | (313) | — | ||||||||||||||
Cash dividends paid on Common Stock | (2,374) | (334) | (444) | ||||||||||||||
Net cash used in financing activities | (2,626) | (140) | (242) | ||||||||||||||
Net Change in Cash and Cash Equivalents | 374 | 49 | 8 | ||||||||||||||
Cash and cash equivalents at beginning of year | 215 | 166 | 158 | ||||||||||||||
Cash and cash equivalents at end of year | $ | 589 | $ | 215 | $ | 166 |
Year ended December 31, | |||||||||||
2019 | 2018 | 2017 | |||||||||
Operating Activities: | |||||||||||
Net earnings attributable to shareholders | $ | 897 | $ | 530 | $ | 475 | |||||
Adjustments: | |||||||||||
Equity in net earnings of subsidiaries | (1,032 | ) | (637 | ) | (575 | ) | |||||
Dividends from subsidiaries | 408 | 238 | 580 | ||||||||
Other operating activities, net | 33 | 84 | 98 | ||||||||
Net cash provided by operating activities | 306 | 215 | 578 | ||||||||
Investing Activities: | |||||||||||
Capital contributions to subsidiaries | (60 | ) | (11 | ) | (93 | ) | |||||
Returns of capital from subsidiaries | 4 | 23 | 30 | ||||||||
Purchases of investments, property and equipment | (3 | ) | (5 | ) | (2 | ) | |||||
Proceeds from maturities and redemptions of investments | 3 | 3 | 2 | ||||||||
Net cash provided by (used in) investing activities | (56 | ) | 10 | (63 | ) | ||||||
Financing Activities: | |||||||||||
Additional long-term borrowings | 315 | — | 712 | ||||||||
Reductions of long-term debt | (150 | ) | — | (745 | ) | ||||||
Issuances of Common Stock | 37 | 34 | 37 | ||||||||
Repurchases of Common Stock | — | (6 | ) | — | |||||||
Cash dividends paid on Common Stock | (444 | ) | (394 | ) | (417 | ) | |||||
Net cash used in financing activities | (242 | ) | (366 | ) | (413 | ) | |||||
Net Change in Cash and Cash Equivalents | 8 | (141 | ) | 102 | |||||||
Cash and cash equivalents at beginning of year | 158 | 299 | 197 | ||||||||
Cash and cash equivalents at end of year | $ | 166 | $ | 158 | $ | 299 |
Segment | Deferred policy acquisition costs | Reserves for future policy benefits, claims and unpaid losses and LAE | Unearned premiums | Net earned premiums | Net investment income | Benefits, claims, losses and settlement expenses | Amortization of deferred policy acquisition costs | Other operating expenses | Net written premiums (excluding life) | |||||||||||||||||||||||||||
2019 | ||||||||||||||||||||||||||||||||||||
Property and casualty insurance | $ | 322 | $ | 10,232 | $ | 2,830 | $ | 5,185 | $ | 472 | $ | 3,271 | $ | 721 | $ | 1,027 | $ | 5,342 | ||||||||||||||||||
Annuity | 696 | 40,406 | — | — | 1,792 | 1,151 | 198 | 189 | — | |||||||||||||||||||||||||||
Other | 19 | 612 | — | 22 | 39 | 36 | 4 | 532 | 3 | |||||||||||||||||||||||||||
Total | $ | 1,037 | $ | 51,250 | $ | 2,830 | $ | 5,207 | $ | 2,303 | $ | 4,458 | $ | 923 | $ | 1,748 | $ | 5,345 | ||||||||||||||||||
2018 | ||||||||||||||||||||||||||||||||||||
Property and casualty insurance | $ | 299 | $ | 9,741 | $ | 2,595 | $ | 4,865 | $ | 438 | $ | 3,003 | $ | 644 | $ | 957 | $ | 5,023 | ||||||||||||||||||
Annuity | 1,360 | 36,616 | — | — | 1,638 | 998 | 212 | 174 | — | |||||||||||||||||||||||||||
Other | 23 | 635 | — | 24 | 18 | 40 | 4 | 479 | 3 | |||||||||||||||||||||||||||
Total | $ | 1,682 | $ | 46,992 | $ | 2,595 | $ | 4,889 | $ | 2,094 | $ | 4,041 | $ | 860 | $ | 1,610 | $ | 5,026 | ||||||||||||||||||
2017 | ||||||||||||||||||||||||||||||||||||
Property and casualty insurance | $ | 270 | $ | 9,678 | $ | 2,410 | $ | 4,579 | $ | 362 | $ | 2,955 | $ | 556 | $ | 867 | $ | 4,751 | ||||||||||||||||||
Annuity | 920 | 33,316 | — | — | 1,458 | 892 | 130 | 159 | — | |||||||||||||||||||||||||||
Other | 26 | 658 | — | 22 | 11 | 26 | 4 | 552 | 3 | |||||||||||||||||||||||||||
Total | $ | 1,216 | $ | 43,652 | $ | 2,410 | $ | 4,601 | $ | 1,831 | $ | 3,873 | $ | 690 | $ | 1,578 | $ | 4,754 |
Segment | Deferred policy acquisition costs | Reserves for claims and unpaid losses and LAE | Unearned premiums | Net earned premiums | Net investment income | Claims, losses and settlement expenses | Amortization of deferred policy acquisition costs | Other operating expenses | Net written premiums | |||||||||||||||||||||||||||||||||||||||||||||||
2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property and casualty insurance | $ | 267 | $ | 11,074 | $ | 3,041 | $ | 5,404 | $ | 663 | $ | 3,157 | $ | 580 | $ | 967 | $ | 5,573 | ||||||||||||||||||||||||||||||||||||||
Other | — | — | — | — | 67 | — | — | 513 | — | |||||||||||||||||||||||||||||||||||||||||||||||
Total | $ | 267 | $ | 11,074 | $ | 3,041 | $ | 5,404 | $ | 730 | $ | 3,157 | $ | 580 | $ | 1,480 | $ | 5,573 | ||||||||||||||||||||||||||||||||||||||
2020 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property and casualty insurance | $ | 244 | $ | 10,392 | $ | 2,803 | $ | 5,099 | $ | 399 | $ | 3,271 | $ | 615 | $ | 1,036 | $ | 5,013 | ||||||||||||||||||||||||||||||||||||||
Other | — | — | — | — | 62 | — | — | 508 | — | |||||||||||||||||||||||||||||||||||||||||||||||
Total | $ | 244 | $ | 10,392 | $ | 2,803 | $ | 5,099 | $ | 461 | $ | 3,271 | $ | 615 | $ | 1,544 | $ | 5,013 | ||||||||||||||||||||||||||||||||||||||
2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property and casualty insurance | $ | 322 | $ | 10,232 | $ | 2,830 | $ | 5,185 | $ | 472 | $ | 3,271 | $ | 721 | $ | 1,027 | $ | 5,342 | ||||||||||||||||||||||||||||||||||||||
Other | — | — | — | — | 60 | — | — | 560 | — | |||||||||||||||||||||||||||||||||||||||||||||||
Total | $ | 322 | $ | 10,232 | $ | 2,830 | $ | 5,185 | $ | 532 | $ | 3,271 | $ | 721 | $ | 1,587 | $ | 5,342 |
American Financial Group, Inc. | |||||||||||||
February 25, | By: | /s/ | |||||||||||
Signature | Capacity | Date | ||||||||||||
/s/ Carl H. Lindner III | Co-Chief Executive Officer and Director | February 25, 2022 | ||||||||||||
Carl H. Lindner III | (Principal Executive Officer) | |||||||||||||
/s/ | Co-Chief Executive Officer and Director | February 25, | ||||||||||||
(Principal Executive Officer) | ||||||||||||||
/s/ Brian S. | ||||||||||||||
February 25, | ||||||||||||||
(Principal Financial and Accounting Officer) | ||||||||||||||
/s/ John B. Berding | Director | February 25, | ||||||||||||
John B. Berding | ||||||||||||||
/s/ James E. Evans | Director | February 25, | ||||||||||||
James E. Evans | ||||||||||||||
/s/ Terry S. Jacobs | Director* | February 25, | ||||||||||||
Terry S. Jacobs | ||||||||||||||
/s/ Gregory G. Joseph | Lead Independent Director* | February 25, | ||||||||||||
Gregory G. Joseph | ||||||||||||||
/s/ Mary Beth Martin | Director | February 25, | ||||||||||||
Mary Beth Martin | ||||||||||||||
/s/ Amy Y. Murray | Director | February 25, 2022 | ||||||||||||
Amy Y. Murray | ||||||||||||||
/s/ Evans N. Nwankwo | Director | February 25, 2022 | ||||||||||||
Evans N. Nwankwo | ||||||||||||||
/s/ William W. Verity | Director | February 25, | ||||||||||||
William W. Verity | ||||||||||||||
/s/ John I. Von Lehman | Director* | February 25, | ||||||||||||
John I. Von Lehman | ||||||||||||||
* Member of the Audit Committee |