American Financial Group, Inc. (NYSE:AFG) is a holding company based in Cincinnati, Ohio and has been in business for more than fifty years. Our insurance roots go back to the 1800's with the founding of Great American Insurance Company in 1872. Today, through the operations of Great American Insurance Group, AFG is engaged primarily in property and casualty insurance ("P&C"), focusing on specialized commercial products for businesses, and in the sale of traditional fixed and fixed-indexed annuities. AFG's purpose is to enable individuals and businesses to manage financial risk using insurance products and services tailored to meet their specific and ever-changing risk exposures. AFG's strategy is to allocate capital to insurance operations which management believes offer a competitive advantage or unique opportunities.
AFG's insurance operations are conducted through Great American Insurance Group. The primary objective of our P&C operations is to achieve solid underwriting profitability while providing excellent service to its agents and policyholders. The P&C operations are primarily comprised of a highly diversified group of businesses offering a wide range of specialty commercial coverages and managed by specialists in particular lines of business or customer groups. The major product lines include inland and ocean marine, workers' compensation, agricultural-related products, executive and professional liability, fidelity and surety, collateral protection, umbrella and excess liability, excess and surplus and commercial automobile. This group writes business in all 50 states primarily through independent agents and brokers.
Our Annuity operations are focused on sales of traditional fixed and fixed-indexed annuities in the education, bank and individual markets.
AFG's primary investment objective is to maximize return on an on-going basis rather than on short-term performance. Our in-house talented team of analysts and investment managers has built a quality investment portfolio that produces a relatively predictable, steady stream of income. Over the years, our conservatively invested, low-risk portfolio has generated solid returns and provided asset growth.
Fixed income securities, primarily investment grade bonds and mortgage-backed securities, account for around 94% of our total investments. (Over 87% of our fixed maturity investments are rated "investment grade" by nationally recognized rating agencies -- 96% are rated NAIC 1 or 2, NAIC's highest ratings). Stocks, real estate, policy loans and other investments make up the remainder of the portfolio. Our real estate investments include commercial real estate operations such as office buildings and a group of hotels, marinas and a resort in various parts of the United States as well as apartment and retail commercial developments. Our real estate investment strategy is based upon our history of buying underperforming or out-of-favor assets, developing and managing them "in house", and selling them when we believe value has been maximized.
With the power of generations behind it, AFG grows and changes with discipline and integrity. We're proud of who we are, where we've been and where we're going. Our industry is changing and we continue to change as well. We strive to continue to build value for our shareholders, provide quality products and service to our customers and offer a rewarding work environment for our employees.