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Shareholders' Equity | 9 Months Ended
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Sep. 30, 2014
Stockholders' Equity Note [Abstract] |
Shareholders' Equity | Shareholders’ Equity AFG is authorized to issue 12.5 million shares of Voting Preferred Stock and 12.5 million shares of Nonvoting Preferred Stock, each without par value. Accumulated Other Comprehensive Income, Net of Tax (“AOCI”) Comprehensive income is defined as all changes in Shareholders’ Equity except those arising from transactions with shareholders. Comprehensive income includes net earnings and other comprehensive income, which consists primarily of changes in net unrealized gains or losses on available for sale securities. The progression of the components of accumulated other comprehensive income follows (in millions):
|  |  | Other Comprehensive Income |  |  |
| AOCI Beginning Balance |  | Pretax |  | Tax |  | Net of tax |  | Attributable to noncontrolling interests |  | Attributable to shareholders |  | AOCI Ending Balance |
Quarter ended September 30, 2014 |  |  |  |  |  |  |  |  |  |  |  |  |  |
Net unrealized gains on securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |
Unrealized holding gains (losses) on securities arising during the period |  |  | $ | (111 | ) |  | $ | 38 |  |  | $ | (73 | ) |  | $ | 2 |  |  | $ | (71 | ) |  |  |  |
Reclassification adjustment for realized (gains) losses included in net earnings (a) |  |  | (14 | ) |  | 6 |  |  | (8 | ) |  | — |  |  | (8 | ) |  |  |  |
Total net unrealized gains on securities (b) | $ | 805 |  |  | (125 | ) |  | 44 |  |  | (81 | ) |  | 2 |  |  | (79 | ) |  | $ | 726 |  |
Foreign currency translation adjustments | (2 | ) |  | (2 | ) |  | — |  |  | (2 | ) |  | — |  |  | (2 | ) |  | (4 | ) |
Pension and other postretirement plans adjustments | (4 | ) |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | (4 | ) |
Total | $ | 799 |  |  | $ | (127 | ) |  | $ | 44 |  |  | $ | (83 | ) |  | $ | 2 |  |  | $ | (81 | ) |  | $ | 718 |  |
Quarter ended September 30, 2013 |  |  |  |  |  |  |  |  |  |  |  |  |  |
Net unrealized gains on securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |
Unrealized holding gains (losses) on securities arising during the period |  |  | $ | 8 |  |  | $ | (4 | ) |  | $ | 4 |  |  | $ | (1 | ) |  | $ | 3 |  |  |  |
Reclassification adjustment for realized (gains) losses included in net earnings (a) |  |  | (56 | ) |  | 20 |  |  | (36 | ) |  | 1 |  |  | (35 | ) |  |  |
Total net unrealized gains on securities | $ | 600 |  |  | (48 | ) |  | 16 |  |  | (32 | ) |  | — |  |  | (32 | ) |  | $ | 568 |  |
Foreign currency translation adjustments | 5 |  |  | 3 |  |  | — |  |  | 3 |  |  | — |  |  | 3 |  |  | 8 |  |
Pension and other postretirement plans adjustments | (6 | ) |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | (6 | ) |
Total | $ | 599 |  |  | $ | (45 | ) |  | $ | 16 |  |  | $ | (29 | ) |  | $ | — |  |  | $ | (29 | ) |  | $ | 570 |  |
Nine months ended September 30, 2014 |  |  |  |  |  |  |  |  |  |  |  |  |  |
Net unrealized gains on securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |
Unrealized holding gains (losses) on securities arising during the period |  |  | $ | 300 |  |  | $ | (106 | ) |  | $ | 194 |  |  | $ | (4 | ) |  | $ | 190 |  |  |  |  |
Reclassification adjustment for realized (gains) losses included in net earnings (a) |  |  | (44 | ) |  | 16 |  |  | (28 | ) |  | 1 |  |  | (27 | ) |  |  |  |
Total net unrealized gains on securities (b) | $ | 563 |  |  | 256 |  |  | (90 | ) |  | 166 |  |  | (3 | ) |  | 163 |  |  | $ | 726 |  |
Foreign currency translation adjustments | 1 |  |  | (5 | ) |  | — |  |  | (5 | ) |  | — |  |  | (5 | ) |  | (4 | ) |
Pension and other postretirement plans adjustments | (4 | ) |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | (4 | ) |
Total | $ | 560 |  |  | $ | 251 |  |  | $ | (90 | ) |  | $ | 161 |  |  | $ | (3 | ) |  | $ | 158 |  |  | $ | 718 |  |
Nine months ended September 30, 2013 |  |  |  |  |  |  |  |  |  |  |  |  |  |
Net unrealized gains on securities: |  |  |  |  |  |  |  |  |  |  |  |  |  |
Unrealized holding gains (losses) on securities arising during the period |  |  | $ | (248 | ) |  | $ | 86 |  |  | $ | (162 | ) |  | $ | 4 |  |  | $ | (158 | ) |  |  |
Reclassification adjustment for realized (gains) losses included in net earnings (a) |  |  | (153 | ) |  | 54 |  |  | (99 | ) |  | 2 |  |  | (97 | ) |  |  |
Total net unrealized gains on securities | $ | 823 |  |  | (401 | ) |  | 140 |  |  | (261 | ) |  | 6 |  |  | (255 | ) |  | $ | 568 |  |
Foreign currency translation adjustments | 14 |  |  | (6 | ) |  | — |  |  | (6 | ) |  | — |  |  | (6 | ) |  | 8 |  |
Pension and other postretirement plans adjustments | (6 | ) |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | (6 | ) |
Total | $ | 831 |  |  | $ | (407 | ) |  | $ | 140 |  |  | $ | (267 | ) |  | $ | 6 |  |  | $ | (261 | ) |  | $ | 570 |  |
(a) | The reclassification adjustment out of net unrealized gains on securities affected the following lines in AFG’s Consolidated Statement of Earnings:
| OCI component |  | Affected line in the Consolidated Statement of Earnings |
| Pretax |  | Realized gains on securities |
| Tax |  | Provision for income taxes |
| Attributable to noncontrolling interests |  | Net earnings (loss) attributable to noncontrolling interests |
(b) | Includes net unrealized gains of $60 million at both September 30, 2014 and June 30, 2014 and $54 million at December 31, 2013 related to securities for which only the credit portion of an other-than-temporary impairment has been recorded in earnings.
Stock Incentive Plans Under AFG’s stock incentive plans, employees of AFG and its subsidiaries are eligible to receive equity awards in the form of stock options, stock appreciation rights, restricted stock awards, restricted stock units and stock awards. In the first nine months of 2014, AFG issued 102,330 shares of restricted Common Stock (fair value of $56.44 per share) and granted stock options for 1.0 million shares of Common Stock (at an average exercise price of $56.47) under the Stock Incentive Plan. In addition, AFG issued 84,036 shares of Common Stock (fair value of $57.16 per share) in the first quarter of 2014 under the Equity Bonus Plan. AFG uses the Black-Scholes option pricing model to calculate the fair value of its option grants. The expected dividend yield is based on AFG’s current dividend rate. To determine expected volatility, AFG considers its daily historical volatility as well as implied volatility on traded options. The expected term was estimated based on historical exercise patterns and post vesting cancellations. The risk-free rate for periods associated with the expected term is based upon the U.S. Treasury yield curve in effect on the grant date.
| Nine months ended September 30,
| 2014 |  | 2013
Exercise price | $ | 56.47 |  |  | $ | 44.01 |
Expected dividend yield | 1.6 | % |  | 1.8 | %
Expected volatility | 26 | % |  | 39 | %
Expected term (in years) | 7.25 |  |  | 7.25 |
Risk-free rate | 2.20 | % |  | 1.36 | %
Grant date fair value | $ | 14.66 |  |  | $ | 15.10 |
Total compensation expense related to stock incentive plans of AFG and its subsidiaries was $4 million and $10 million in the third quarter and $18 million and $30 million in the first nine months of 2014 and 2013, respectively.

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- Definition The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08.(d),(e)) -URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section S99 -Paragraph 4 -Subparagraph (SAB TOPIC 4.C) -URI http://asc.fasb.org/extlink&oid=27012166&loc=d3e187143-122770 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.5-02.29-31) -URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 310 -SubTopic 10 -Section S99 -Paragraph 2 -Subparagraph (SAB TOPIC 4.E) -URI http://asc.fasb.org/extlink&oid=27010918&loc=d3e74512-122707 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Staff Accounting Bulletin (SAB) -Number Topic 4 -Section C Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Staff Accounting Bulletin (SAB) -Number Topic 4 -Section E Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 08 -Article 4 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 6 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21506-112644 Reference 9: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Glossary Preferred Stock -URI http://asc.fasb.org/extlink&oid=6521494 Reference 10: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 02 -Paragraph 29, 30, 31 -Article 5 Reference 11: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 04 -Article 3 Reference 12: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21463-112644 Reference 13: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.3-04) -URI http://asc.fasb.org/extlink&oid=27012166&loc=d3e187085-122770 Reference 14: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21475-112644 Reference 15: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 11 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21564-112644 Reference 16: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 5 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21488-112644 Reference 17: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 4 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21484-112644 Reference 18: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 08 -Paragraph d -Article 4 Reference 19: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 30 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6405834&loc=d3e23285-112656 + Details
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