Good day, and thank you for standing by. Welcome to the American Financial Group 2025 Third Quarter Results Conference Call. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Diane Weidner, Vice President, Investor Relations. Please go ahead.

Good morning, and welcome to American Financial Group's Third Quarter 2025 Earnings Results Conference Call. We released our results yesterday afternoon. Our press release, investor supplement and webcast presentation are posted on AFG's website under the Investor Relations section. These materials will be referenced during portions of today's call. I'm joined this morning by Carl Lindner III and Craig Lindner, Co-CEOs of American Financial Group; and Brian Hertzman, AFG's CFO. Before I turn the discussion over to Carl, I would like to draw your attention to the notes on Slide 2 of our webcast. Some of the matters to be discussed today are forward-looking. These forward-looking statements involve certain risks and uncertainties that could cause our actual results and/or financial condition to differ materially from these statements. A detailed description of these risks and uncertainties can be found in AFG's filings with the Securities and Exchange Commission, which are also available on our website. We may include references to core net operating earnings, a non-GAAP financial measure, in our remarks or in responses to questions. A reconciliation of net earnings to core net operating earnings is included in our earnings release. And finally, if you're reading a transcript of this call, please note that it may not be authorized to review for accuracy. And as a result, it may contain factual or transcription errors that could materially alter the intent or meaning of our statements. Now I'm pleased to turn the call over to Carl Lindner III to discuss our results.

Good morning. I'll begin by sharing a few highlights of AFG's 2025 third quarter results, after which Craig and I will walk through more details. We'll then open it up for Q&A, where Craig, Brian, and I will be happy to respond to your questions. We're pleased to report an annualized core operating return on equity of 19% for the third quarter. Our underwriting margins in our Specialty Property and Casualty insurance businesses were strong. Net investment income increased by 5% year-over-year despite muted returns from our alternative investment portfolio when compared to the long-term historical performance of those investments. Our compelling mix of Specialty Insurance businesses, entrepreneurial culture, disciplined operating philosophy, and an astute team of in-house investment professionals continue to position us well for the future and enable us to continue to create value for our shareholders. Craig and I thank God, our talented management team, and our great employees for helping us to achieve these results. I'll now turn the discussion over to Craig to walk us through some of the details.

Thank you, Carl. Please turn to Slides 3 and 4 for third quarter highlights. AFG reported core net operating earnings of $2.69 per share compared to $2.31 per share in the prior year period, a 16% increase. I'll begin with an overview of AFG's investment portfolio, investment performance, and share a few comments about AFG's financial position, capital, and liquidity. The details surrounding our $16.8 billion portfolio are presented on Slides 5 and 6. Net investment income in our property and casualty insurance operations for the 3 months ended September 30, 2025, increased 5% year-over-year as a result of higher interest rates and higher balances of invested assets. As shown on Slide 6, nearly 2/3 of our portfolio is invested in fixed maturities. In the current interest rate environment, we're able to invest in fixed maturity securities at yields of approximately 5.25%. The duration of our P&C fixed maturity portfolio, including cash and cash equivalents, was 2.7 years at September 30, 2025. The annualized return on alternative investments in our P&C portfolio was approximately 6.2% for the 2025 third quarter compared to 5.4% for the prior year quarter. Although the overall return on our multifamily investments continues to be tempered by challenges within the broader economic environment, we're seeing evidence of recovery. Strong occupancy, a return to historical levels of lease renewals, and more stability in the overall rental rate environment contribute to improving conditions despite a prolonged softer market caused by excess supply of new properties in several of our targeted regions. Importantly, a large portion of our portfolio of multifamily properties is located in desirable geographies with strong job and wage growth. Although the supply of properties in these locations is elevated as compared to historical levels, new starts have declined significantly and at a faster pace than in other regions. We believe that tightening supply and a significantly reduced development pipeline will drive higher rental and occupancy rates and improve results by the end of 2026. Longer term, we continue to be optimistic regarding the prospects of attractive returns from our overall alternative investment portfolio with an expectation of annual returns averaging 10% or better. Please turn to Slide 7, where you'll find a summary of AFG's financial position at September 30, 2025. During the third quarter, we returned $66 million to our shareholders through the payment of our regular quarterly dividend. In October, AFG's regular quarterly dividend was increased 10% over the previously declared rate to $0.88 per share and paid on October 24, 2025. In conjunction with our earnings release, we declared a special dividend of $2 per share payable on November 26, 2025, to shareholders of record on November 17, 2025. The aggregate amount of special dividends will be approximately $167 million. With this special dividend, the company has declared $54 per share or $4.6 billion in special dividends since the beginning of 2021. Carl and I consider these special dividends to be an important component of total shareholder return. We expect our operations to continue to generate significant excess capital throughout the remainder of 2025 and into 2026, which provides ample opportunity for acquisitions, special dividends, or share repurchases over the next year. We evaluate the best alternatives for capital deployment on a regular basis. We continue to view total value creation as measured by growth in book value plus dividends as an important measure of performance over the longer term. For the 9 months ended September 30, 2025, AFG's growth in book value per share, excluding AOCI plus dividends, was nearly 11%. I'll now turn the call over to Carl to discuss the results of our P&C operations.

Thank you, Craig. Please turn to Slides 8 and 9 of the webcast, which include an overview of our third quarter results. Our commitment to underwriting discipline and prudent growth was evident in the solid performance of our Property and Casualty businesses in the third quarter. We're finding attractive opportunities to grow our Specialty Property and Casualty businesses despite walking away from challenging market conditions in a few markets or poorly performing accounts. I'm pleased with the overall underwriting profitability in our Specialty Property and Casualty businesses in the third quarter of this year and remain confident about the strength of our reserves. A continued favorable pricing environment, increased exposures, and new business opportunities enabled us to selectively grow our Specialty Property and Casualty businesses. Although the timing of reporting of crop acreage by our insureds shifted some crop premium from the third quarter to the second quarter, as we discussed on last quarter's call, this tempered premium growth in the third quarter. We continue to expect premium growth for the full year in 2025 in the low single digits. In addition to organic growth opportunities and evaluating acquisitions, we always try to maintain a pipeline of start-ups that have the potential to become new business units in our portfolio of Specialty businesses. Taking an early look at next year, we currently project 2026 premium growth to rebound as we're optimistic about the growth from these start-ups and the near completion of numerous underwriting actions taken in our Specialty and Casualty businesses. Turning to Slide 8, you'll see that underwriting profit in our Specialty Property and Casualty insurance businesses grew 19% and generated a 93% combined ratio in the third quarter of 2025, an improvement of 1.3 points from the prior year period. Results for the 2025 third quarter include 1.2 points related to catastrophe losses compared to 4.4 points in last year's third quarter. Third quarter 2025 results benefited from 1.2 points of favorable prior year reserve development compared to 0.8 points in the third quarter of 2024. Third quarter gross and net written premiums were down 2% and 4%, respectively, when compared to the third quarter of last year. Excluding our crop business, gross written premiums grew 3% and net written premiums were flat year-over-year. Average renewal pricing across our Property and Casualty Group was up approximately 5% in the third quarter, both including and excluding workers' comp. We reported overall renewal rate increases for 37 consecutive quarters, and we believe we are achieving overall renewal rate increases in excess of prospective loss ratio trends to meet or exceed our targeted returns. Now I'd like to turn to Slide 9 to review a few highlights from each of our Specialty Property and Casualty business groups. Details are included in our earnings release, so I'll focus on summary results here. The businesses in the Property and Transportation Group achieved a solid 94.1% calendar year combined ratio in the third quarter of 2025, an improvement of 2.7 points from the comparable 2024 period. This group's third quarter 2025 combined ratio included 0.4 point attributed to catastrophe losses compared to 3.7 points in the 2024 third quarter, which was the primary driver of the improved year-over-year profitability. Third quarter 2025 gross and net written premiums in this group were 6% and 9% lower, respectively, than the comparable prior year period. As mentioned before, the earlier reporting of crop acreage by insureds impacted the timing of the recording of crop premiums and contributed to the year-over-year decrease, particularly when compared to later reporting of acreage the previous year. Excluding the crop business, gross written premiums in this group grew by 2% and net written premiums were flat. We continue to see new business opportunities, a favorable rate environment, and increased exposures in our transportation businesses. Overall renewal rates in this group increased 6% on average in the third quarter of 2025. We continue to remain focused on rate adequacy, particularly in our commercial auto liability line of business, where rates were up approximately 11% in the third quarter. In our crop business, harvest pricing for corn and soybeans settled 10% and 2% lower, respectively, than spring discovery pricing, which is well within acceptable ranges and yield expectations are steady. Based on these factors, we continue to anticipate an average crop year. Our third quarter results reflect an element of seasonality as most of our crop insurance premiums are earned in AFG's third quarter, but booked at a more conservative combined ratio until the fourth quarter. Over the coming weeks, we'll have better visibility into actual yields and claim activity in our MPCI businesses, and we'll also have a clear indication of the performance of our private products business. With this more complete picture, we'll record the majority of our calendar year crop profitability in the fourth quarter as is our standard practice. The businesses in our Specialty and Casualty Group achieved a 95.8% calendar year combined ratio overall in the third quarter, 3.7 points higher than the 92.1% reported in the comparable period in 2024. Third quarter gross written premiums increased 3%. Net written premiums were flat compared to the same prior year period. Primary drivers of growth included new business opportunities and favorable renewal pricing in several of our targeted market businesses and an increase in M&A activity that contributed to growth in our mergers and acquisitions business. This growth was tempered by lower premiums in our excess and surplus, executive liability, and social services businesses. Overall renewal pricing in this group was up approximately 7% during the third quarter, an increase of about 1 point from the previous quarter. Average renewal pricing, excluding workers' comp, was up approximately 8%, in line with pricing in the second quarter. And I'm pleased that we again achieved renewal rate increases in the mid-teens in our most social inflation-exposed businesses, including our social services and excess liability businesses. In addition, our workers' compensation businesses collectively achieved a modest pricing increase during the quarter, a favorable trend. Several businesses in this group, particularly our excess liability businesses have been navigating the challenges of social inflation for several years and have demonstrated their nimbleness and resilience through the cycle. Over the last 5 years, one of our largest excess liability businesses has decreased aggregate limits by 25% while more than doubling premium, primarily as a result of rate increases. We're continuing to exercise discipline through the use of predictive analytics, risk selection, and careful coordination between our underwriting, actuarial, and claims professionals to ensure that our businesses are earning targeted returns. The Specialty Financial Group continued to achieve excellent underwriting margins and reported a combined ratio of 81.1% for the third quarter of 2025, 11.2 points better than the comparable period in 2024. These results reflect 4.1 points related to catastrophe losses compared to 14.4 points in the prior year period, contributing to higher year-over-year underwriting profitability in our financial institutions business. Third quarter gross and net written premiums in this group were up 3% and 1%, respectively, when compared to the prior year period. The growth is primarily attributed to our growth in our financial institutions business and our Great American Europe business, which designs and delivers a broad portfolio of innovative and customized insurance programs across the U.K. and Europe. Net written premiums were tempered by our decision to cede more of the coastal exposed property business in our lender services business. Renewal pricing in this group was down approximately 2% in the third quarter, reflecting the strong margins earned overall in these businesses. Craig and I are proud of our history of long-term value creation. We have years of experience navigating economic and insurance cycles. Our insurance professionals continue to exercise their Specialty Property and Casualty knowledge and experience to successfully compete in a dynamic marketplace. And our in-house investment team has been both strategic and opportunistic in the management of our $17 billion investment portfolio. One of our greatest strengths is finding opportunities in times of uncertainty. We're well positioned to continue to build long-term value for our shareholders for the remainder of 2025 and beyond. Now we'll open the lines for the Q&A portion of today's call. And Craig, Brian, and I will be happy to respond to your questions.

Our first question comes from Michael Zaremski of BMO Capital Markets.

First question on capital management. We clearly saw the special dividend announcement. But curious why there were no buybacks or not material buybacks in the quarter. Last quarter, you had done buybacks and valuation wasn't too dissimilar from the average this quarter is my understanding. So just curious, any color there? And do you expect repurchases to resume depending on your, I guess, your answer.

Yes, Mike, this is Craig. I would say that we become very active with our purchases when the stock is trading at a significant discount to what we believe is its true value. There have been times when we repurchased a considerable number of shares, particularly from 2008 to 2010, when we bought back around 30% of our shares at attractive levels. Therefore, I wouldn't place too much emphasis on the repurchases or lack thereof in just one quarter. What I can say is that we have maintained a significant amount of capital available to capitalize on any opportunities to repurchase shares if they arise.

Okay. That's helpful, Craig. Turning to the operating environment on the P&C side, it was interesting to hear your comment, but I found it a bit surprising. We received some feedback from investors last night when you mentioned that pricing was around 5% both with and without compensation. You believe you are achieving rates that exceed prospective loss trends, while many companies, including Triangle, estimate loss trends to be above 5%. Do you have any additional comments to clarify my assumption on this?

I can't speak for other companies. I can speak for us. And an overall 5% price increase is still exceeding our prospective loss ratio trends. We have a decent chunk of our business in workers' comp where loss ratio trends are really pretty benign. And a lot of other businesses, we have a very diverse portfolio. So not all of our businesses reflect a casualty loss ratio trend in that. So I can only speak for our own mix of business and what our own actuaries tell us.

Got it. That's helpful, Carl. Let's focus on the loss trends and pricing. Can we pinpoint some lines of business that have created more challenges over the past year in the industry? We appreciate that AFG's return on equity is industry-leading. Regarding social inflationary lines of business, are we noticing a halt in the previously accelerating pricing trends? Do you think the loss cost trend is remaining stable, or is there still an upward bias? For instance, when we look at the underlying loss ratio in Specialty and Casualty, is the trend moving upward?

With 30 businesses, we adjust loss ratio trends every quarter. We conduct actuarial valuations and evaluations of the business. Some loss ratio trends improve while others, especially those exposed to social inflation, are closely monitored to ensure that pricing is appropriate. Overall, there haven't been many changes in loss ratio trends over the past couple of quarters; however, some businesses have shown improvement while others have seen slight increases. We observed a small decline in our specialty financial business, particularly in the lender-placed property sector, which is not unexpected given its high margins after years of significant rate increases. Compared to what many firms in the Excess & Surplus market and larger property companies are experiencing with price revisions, I would prefer to manage a slight decline in our lender-placed property business rather than facing double-digit declines in a substantial portion of our operations. This is the primary reason our pricing appears somewhat lower. But I am pleased to report that pricing in our Specialty Casualty, excluding comp, is still up 8% in the quarter. I'm also very pleased to see some pricing increases in our overall workers' comp book, especially driven by California's favorable trends right now. I believe conditions in California will likely keep improving. Brian, you mentioned the anticipated 11% increase effective September 1.

Effective September 1.

Yes, I believe that the price increase in California will only improve further.

Our next question comes from Andrew Andersen of Jefferies.

Maybe just back on the workers' comp. It was good to see that price tick up, and it sounds like California could see some further momentum. But perhaps we could touch on some other geographies. Are you seeing some pricing tick up a little bit elsewhere?

In our strategic comp business, which is fairly sizable, we've also seen positive price changes there. However, in the Southeast, some areas have continued to experience mid-single-digit price declines.

Okay. And maybe a bigger picture macro question just on crop. Pricing on corn and soybeans has been coming in for a couple of years, and I suppose that could partially be due to some change in trade policies. But I'd be interested in hearing your thoughts just kind of on the outlook maybe intermediate term for crop premium and crop pricing as kind of trading with global partners changes.

Well, I think you probably need a pretty good crystal ball trying to figure that out. You would think that probably the trade aspect of soybeans is probably being reflected in the futures prices at this point, which would lead you to believe that premium should be stable or maybe even increasing. Corn futures prices into '26 appear to be fairly stable against spring discovery prices this year. That said, we won't know until the actual 30-day average in the first quarter next year establishes spring discovery prices. But as of now, it looks like prices should either remain stable or show improvement if there's a better relationship between China and the U.S.

Our next question comes from Meyer Shields of Keefe, Bruyette, & Woods.

I also had two questions on crop. The first, I completely understand the comments about written premium having moved to the second quarter. I'm wondering whether there was a higher percentage of earned premiums in Property and Transportation this year rather than last year as a contributor to the higher attritional loss ratio.

This is Brian. So if you remember, last year at this time, we were feeling pretty optimistic about the potential for an above-average crop year. And then in the fourth quarter, there were some variations in harvest by county that caused us to end up with more of a standard crop year. So we booked a little bit more crop income last year in the third quarter than we did this year in the third quarter. This year, in the third quarter, we have about half of our crop premium earned for the year in the quarter, booked at close to a 100 combined ratio. Removing the noise from the crop figures, our accident year loss ratio for Property and Transportation improved due to lower frequency in our transportation and marine businesses. So if you consider the crop impacts, we did see an improvement in the loss ratio.

Okay. That's very helpful. And I'm just wondering, bigger picture in crop. So there's a new participating insurance company over the last couple of years. Is that having any impact on the amount of premium you're getting from agents or maybe some agents moving along? I don't know how mobile we should think of that premium as being.

I think it probably impacts us marginally on that. What our guys would say is they're probably getting some of the business that we'd be least excited about.

I'm showing no further questions at this time. I'll go ahead and turn the call back over to Diane Weidner for closing remarks.

Thank you all for participating today. We appreciate your questions and look forward to talking to you again next quarter when we share our fourth quarter results. Hope you have a great day.

Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.