AFG reports higher Q3 earnings

American Financial Group , the parent of Great American Insurance Group, reported third-quarter net earnings of $282 million, up from $215 million a year earlier. Core net operating earnings rose to $329 million, or $3.97 per share, from $224 million, or $2.69 per share.

Results benefited from the sale of Charleston Harbor Resort & Marina, which generated $126 million in pretax net investment income and contributed $1.21 per share to core operating earnings. P&C net investment income increased 41% to $289 million; excluding the property sale, it rose 10%.

Gross written premiums increased 8% to $3.96 billion, while net written premiums rose 9% to $2.45 billion. Average renewal rates increased approximately 5%, or 6% excluding workers’ compensation.

Specialty P&C underwriting profit declined to $133 million from $139 million, with the combined ratio rising to 93.8% from 93.0%. Improvements in Property and Transportation and Specialty Casualty were offset by weaker Specialty Financial results, reflecting a large loss in European operations and lower favorable reserve development.

Property and Transportation net written premiums grew 14%, while underwriting profit increased to $68 million from $55 million. Specialty Casualty underwriting profit rose to $42 million from $33 million. Specialty Financial underwriting profit fell to $23 million from $51 million, despite 14% growth in net written premiums.

AFG also declared a $3.50-per-share special dividend, totaling approximately $290 million, payable November 25 to shareholders of record November 16. The company repurchased $26 million of shares during the quarter.