ATLANTIC AMERICAN CORP 10-K

Item 9A. Controls and Procedures Evaluation of Disclosure Controls and Procedures Management of the Company is responsible for establishing and maintaining adequate internal control over financial reporting for the Company. The Company’s internal control over financial reporting system has been designed to provide reasonable assurance regarding the reliability and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. Management recognizes that there are inherent limitations in the effectiveness of any internal control system. Because of its inherent limitations, internal control over financial reporting may not prevent or detect all misstatements. Furthermore, the application of any evaluations of effectiveness on future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. As of the end of the period covered by this report, an evaluation was performed under the supervision and with the participation of our management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934). Based on that evaluation, management, including the Chief Executive Officer and Chief Financial Officer, concluded that disclosure controls and procedures were not effective as of that date due to a material weakness in internal control over financial reporting described below. Management’s Report on Internal Control Over Financial Reporting Management assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, 2022 based upon the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in the updated 2013 Internal Control – Integrated Framework . Based on that evaluation, management believes that internal control over financial reporting as such term is defined in Exchange Act Rule 13a-15(f) was not effective as of December 31, 2022, as a result of the material weakness described below. A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis. As a result of management’s evaluation, we identified certain deficiencies in internal control that we believe rise to the level of a material weakness. Specifically, management determined that certain process controls over the development, testing, and implementation of our actuarial models used to estimate certain values in the Medicare supplement line of business within our life and health segment were not effective and the related management review controls did not operate at an appropriate level of precision to identify anomalies in results timely enough to allow management to respond without delays in our financial reporting process. Notwithstanding these deficiencies, management believes that, as a result of the actions taken by management to address and correct these deficiencies prior to the completion and filing of this Annual Report on Form 10-K, and the effective operation of other internal controls over financial reporting, the material weakness did not result in any identified material misstatements to our financial statements. As a result, there were no changes to any of our historical financial statements. This Annual Report does not include an attestation report of the Company’s independent registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by the Company’s independent registered public accounting firm pursuant to certain rules of the Securities and Exchange Commission that exempt non-accelerated filers, including the Company, from such requirement. Changes in Internal Control Over Financial Reporting The Company has implemented changes in processes that include enhanced controls over the development, testing, and implementation of actuarial models, and additional controls over the reporting of the financial information that is obtained from these models. Specifically, the Company has taken the following actions: • Developed enhanced documentation of the product parameters and assumptions used in actuarial models and enhanced controls over their testing and implementation in the models. • Improved reconciliations of the policyholder data between the source administrative systems and the actuarial models. • Implemented additional controls over the reporting processes including enhanced analytical procedures and establishing a second independent reviewer. • Hired additional actuarial staff to assist with actuarial model implementation and actuarial valuation. 53 Table of Contents Except for the changes described above, which were initiated during the quarter ended December 31, 2022, and continued into the six months ending June 30, 2023, there were no changes in the Company’s internal control over financial reporting during the quarter ended December 31, 2022, that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting. No system of controls, no matter how well designed and implemented, can provide absolute assurance that the objectives of the system of controls are met. Furthermore, no evaluation of controls can provide absolute assurance that all control issues and any instances of fraud within a company have been detected. Item 9B. Other Information None. Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections Not applicable. 54 Table of Contents PART III ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE The following sets forth the names, ages, positions, and biographies as of June 1, 2023 of the members of the Company’s Board of Directors and the Company’s executive officers : Name Age Position with the Company Hilton H. Howell, Jr 61 Chairman of the Board, President and Chief Executive Officer Robin R. Howell 58 Director Mark E. Preisinger 63 Director Joseph M. Scheerer 48 Director Scott G. Thompson 78 Director D. Keehln Wheeler 62 Director J. Ross Franklin 45 Vice President, Chief Financial Officer and Secretary The biographies below contain information regarding, as applicable, the person’s service to the Company, business, educational, and other professional experience, director positions with any other “publicly traded” company held currently or at any time during the last five years, information regarding involvement in certain legal or administrative proceedings, if applicable, during the last ten years, and for Directors, the experiences, qualifications, attributes or skills that caused the Board to determine that the person should be nominated to serve as a Director of the Company. The Company believes that the backgrounds and qualifications of its Directors, considered as a group at any time, should provide diverse business and professional capabilities, along with the experience, knowledge and other abilities that will allow the Board to effectively fulfill its responsibilities. Mr. Howell has been President and Chief Executive Officer of the Company since May 1995 and prior thereto served as Executive Vice President of the Company from October 1992 to May 1995. During his tenure with the Company, Mr. Howell has also served in various capacities for the Company’s subsidiaries. He is actively engaged in key decision making of each of the Company’s operating subsidiaries and has longstanding relationships with not only the Company’s employees but a significant number of the Company’s subsidiaries’ independent agents. He has been a Director of the Company since October 1992 and, beginning in February 2009, assumed the role of Chairman of the Board of Directors. Mr. Howell also serves as the executive chairman and chief executive officer, and a director, of Gray Television, Inc., a leading media company. Given the size of the Company and the scope of its operations, the Board of Directors has concluded that Mr. Howell, due to his high level of involvement, can serve effectively in the dual role of Chairman of the Board and President and Chief Executive Officer. In addition to being very familiar with our Company, Mr. Howell is also a former attorney, which background provides additional perspective to the decisions facing not only our Company but also the Board of Directors. Mr. Howell has also been actively involved in various segments of the insurance industry throughout his career, resulting in significant depth and breadth of industry knowledge, which is beneficial to the Board of Directors. Mr. Howell is the son-in-law of Harriett J. Robinson, a greater than 5% holder of the outstanding shares of Common Stock of the Company, and is also Mrs. Howell’s husband. 55 Table of Contents Mrs. Howell has been a Director of the Company since May 2012. She has served as Vice President and a Director of both Delta Life Insurance Company and Delta Fire & Casualty Insurance Company since 1992. Mrs. Howell also serves on the board of Gray Television, Inc. She is a former Chairman of the Board of Farmer’s and Merchant’s Bank and a former director of Premier Bancshares, Inc. She received a BA in Economics from the University of Virginia and a Masters of Business Administration from the University of Texas at Austin, and she has held a number of management and oversight roles in various businesses in which her family maintains an interest. Mrs. Howell is active in the community, including having served as Chair of the Board of Directors and Executive Committee of the High Museum of Art, on the Governing Board of the Woodruff Arts Center, and as a member of the Forward Arts Foundation. Mrs. Howell’s experience in board matters and the insurance industry and involvement at the executive level in various businesses is invaluable to the Board, and her numerous civic, social and academic associations provides valuable insight for the Company and elevates the Company’s profile in the community. Mrs. Howell is the wife of Mr. Howell and the daughter of Mrs. Robinson. Mr. Preisinger has been a Director of the Company since March 2016. He is the Director of Corporate Governance for The Coca-Cola Company, a total beverage company with products sold in more than 200 countries and territories. In this capacity his responsibilities include coordinating engagement between the company and its institutional and retail shareholders, with a primary focus on corporate governance, environmental and social issues. He joined The Coca-Cola Company in 1984 and has managed a variety of domestic and international assignments for the business. Mr. Preisinger serves on the Advisory Board for the Ira M. Millstein Center for Global Markets and Corporate Ownership at Columbia Law School and is an Emeritus member of the Advisory Board of the Weinberg Center for Corporate Governance at the University of Delaware. He is a past member of the New York Stock Exchange Listed Company Advisory Board and the Board of Governors of the International Corporate Governance Network. He is also a past Co-Chairman of the Council of Institutional Investors and he has been listed on the NACD 100 most influential people in the boardroom. The Board believes Mr. Preisinger’s significant experience and insight into executive and corporate governance matters will greatly benefit the Board and complement its perspectives. Mr. Scheerer has been a Director of the Company since December 2014. Mr. Scheerer is the Chief Executive Officer of Stonybrook Capital, LLC, which was founded in 2012 and is a specialist merchant bank focused on the insurance industry. Mr. Scheerer is also an active investor in the insurance sector, and is a frequent speaker on the state of the insurance and reinsurance industries. Mr. Scheerer previously served on the board of directors of Insurance Acquisition Corporation and on its compensation committee. He is also the chairman of the investment and advisory committee of the Inter-Atlantic Stonybrook Insurance Technology fund. Mr. Scheerer graduated from the University of Pennsylvania with a Bachelor of Arts in Economics and International Relations. His extensive knowledge of the insurance industry provides valuable insight and perspective to the Board and is also a benefit and resource for management. Mr. Thompson has been the President and Chief Executive Officer of American Southern Insurance Company, a subsidiary of the Company, since 2004; prior thereto he had been the President and Chief Financial Officer of that company since 1984. He has been a Director of the Company since February 1996. Mr. Thompson is a certified public accountant and has been employed by American Southern for substantially his entire career. His insights with respect to American Southern’s business model, its historical operations and the perspective on its niche products provide valuable insight to the Board of Directors. Mr. Wheeler has been a Director of the Company since June 2015. He is the Founder and Chief Executive Officer of MaxMedia, a digital media marketing and branding agency based in Atlanta, Georgia which he founded in 1996. Mr. Wheeler has founded, or was a member of the board of, a number of successful companies. Mr. Wheeler’s prior board experience and his executive leadership and success in various digital media marketing and branding experiences provide additional expanded perspectives to the Board of Directors. 56 Table of Contents Mr. Franklin has been Vice President, Chief Financial Officer and Secretary of the Company since November 2017, and prior thereto served as Interim Chief Financial Officer from August 2017 to November 2017. Since 2000 he has held various roles of increasing responsibility with Atlantic American and its subsidiaries, previously serving as Vice President, Accounting and Treasurer of Bankers Fidelity since 2009. Board Leadership and Structure, and Risk Oversight The Company is a “controlled company” and has historically experienced limited turnover in its senior management and Board of Directors. The Company maintains a board leadership structure under which our President and Chief Executive Officer (“CEO”) also serves as the Chairman of the Board of Directors. We believe that the Company, like many other publicly-traded and private companies, is well-served by this leadership structure. Having one person serve as both CEO and Chairman of the Board demonstrates for our employees, agents, suppliers, customers and other shareholders that our Company is under strong leadership, with a single person setting the tone and having primary responsibility for managing our operations and guiding our strategic efforts. We believe having a single leader for both the Company and the Board of Directors eliminates the potential for confusion or duplication of efforts, and provides clear direction and leadership for our Company. We believe that having one person serve as CEO and Chairman of the Board is appropriate and in the best interests of our Company and our shareholders at this time. The Board has not formally designated a lead independent director and believes that as a result thereof, executive sessions of the Board, which are attended solely by independent directors, result in an open and free flow of discussion of any and all matters that any director may believe relevant to the Company and/or its management. The Company believes that its leadership structure appropriately allows all directors to effectively participate in the provision of risk oversight. While the Board maintains oversight responsibility for the management of the Company’s risks, it has delegated oversight responsibility for certain areas of potential exposure to its committees. The Audit Committee oversees the accounting and financial reporting processes of the Company, as well as legal and compliance matters and risk management. The Audit Committee charter provides that the Audit Committee is responsible for overseeing the internal controls of the Company along with its adherence to compliance and regulatory requirements. The Audit Committee also reviews and approves all transactions with related parties. On at least a quarterly basis, the Company’s Assistant Vice President of Internal Audit provides a comprehensive report to the Audit Committee regarding the Company’s risk management activities. While the Audit Committee has been delegated primary responsibility for overseeing risk management, our entire Board of Directors is actively involved in overseeing this function for the Company. The full Board also engages in periodic discussion with the CEO, Chief Financial Officer (“CFO”), executive management of each of the Company’s operating subsidiaries and other corporate officers as the Board may deem appropriate or desirable. In addition to the roles performed by the Audit Committee, the Stock Option and Compensation Committee considers, evaluates and oversees potential risks that may arise through the implementation of our compensation programs and engages directly with all Board members, as and if necessary. We do not believe our compensation programs encourage unnecessary or excessive risk taking. The Company believes that its leadership structure promotes effective Board oversight of risk management because the Board directly, and through its various committees, is regularly provided by management the information necessary to appropriately monitor, evaluate and assess the Company’s overall risk management. Pursuant to our bylaws (the “Bylaws”), any director who is an “independent director” under the listing standards of the NASDAQ Stock Market (the “NASDAQ Rules”) and not a member of the family of the controlling shareholder of the Company shall offer to resign from the Board upon reaching age 72 and not be eligible to stand for reelection to the Board following such individual having reached age 72, absent a waiver from such requirement, which waiver may only be granted by affirmative vote of the majority of the members of the Board, not including the affected member. Committees of the Board of Directors As a result of the level of beneficial ownership of our Common Stock by members of the Robinson and Howell families and their affiliates, the Company meets the definition of a “controlled company” as defined pursuant to Rule 5615(c)(1) of the NASDAQ Rules. Accordingly, the Company is exempt from certain requirements of the NASDAQ Rules, including the requirement that a majority of its Board of Directors be independent, as defined in such rules, the requirement that director nominees be selected, or recommended for the board’s selection, by either a majority of the independent directors or a nominating committee comprised solely of independent directors, and certain requirements relating to the determination of executive officer compensation. Notwithstanding this, however, the Board of Directors has determined that the following individuals are independent pursuant to the NASDAQ Rules for purposes of serving as a member of the Board of Directors: Mark E. Preisinger, Joseph M. Scheerer and D. Keehln Wheeler. 57 Table of Contents The Board of Directors of the Company has three standing committees: the Executive Committee, the Stock Option and Compensation Committee and the Audit Committee. The Executive Committee consists of Messrs. Howell and Wheeler, and Mrs. Howell. The Executive Committee’s function is to act in the place and stead of the Board of Directors to the extent permitted by law on matters which require Board action between meetings of the Board of Directors. The Executive Committee met once during 2022. The Stock Option and Compensation Committee consists of Messrs. Wheeler, Scheerer and Preisinger (Chairman), who are each independent pursuant to the NASDAQ Rules. The Stock Option and Compensation Committee’s function is to establish the number of equity incentive awards to be granted to officers and key employees and the annual salaries and bonus amounts payable to executive officers of the Company. The Stock Option and Compensation Committee met or acted by written consent two times during 2022. Due to its status as a “controlled company” pursuant to NASDAQ Rules and the related historically low turnover among Board and Committee members, as well as among the Company’s executive officers, the Board has not foreseen a need to adopt a written charter to govern the Stock Option and Compensation Committee’s functions or to engage a compensation consultant. The committee maintains the sole authority to fulfill its responsibilities and has not delegated any responsibilities except that the Committee may from time to time authorize one or more officers of the Company to designate employees (other than executive officers of the Company) to receive awards under the Company’s 2022 Equity and Incentive Compensation Plan (the “2022 Plan”) and to determine the size of such awards, subject to the limitations set forth in the 2022 Plan. During the course of the committee’s decision process regarding compensation for the executive officers, the committee may seek input from Mr. Howell with respect to the performance of the other officers and other factors to consider in making compensation decisions. The Audit Committee is currently composed of Messrs. Wheeler (Chairman), Scheerer and Preisinger. The Audit Committee oversees the Company’s (i) financial reports and other financial information; (ii) systems of internal controls regarding finance, accounting, legal compliance and ethics; and (iii) auditing, accounting and financial reporting processes. The Board of Directors has determined that all members of the Audit Committee are independent for purposes of being an Audit Committee member, and financially literate, as such terms are defined in the NASDAQ Rules and the rules of the SEC. In addition, the Board of Directors has determined that Mr. Scheerer is an “audit committee financial expert” as defined by the SEC in Item 407(d) of Regulation S-K. In making such determination, the Board took into consideration, among other things, the express provision in Item 407(d) of Regulation S-K that the determination that a person is an audit committee financial expert shall not impose any greater responsibility or liability on that person than the responsibility and liability imposed on such person as a member of the Audit Committee, nor shall it affect the duties and obligations of other Audit Committee members or the Board of Directors. The Audit Committee has a written charter which sets out its authority and responsibilities, a copy of which is available on the Company’s website, www.atlam.com. The Audit Committee met four times during 2022. Due to its status as a controlled company pursuant to NASDAQ Rules and the related historically small turnover of its members, the Board has not historically foreseen the need to establish a separate nominating committee or adopt a written charter to govern the director nomination process. The Company’s controlling shareholder and the Board of Directors have generally addressed the need to retain members and fill vacancies after discussion among current members, or the members of the Executive Committee, if necessary in lieu of the full Board, and the Company’s management, with the input from the Company’s controlling shareholder. The Board of Directors does not have any specific qualifications that are required to be met by director candidates and does not have a formal process for identifying and evaluating director candidates. Additionally, the Board of Directors does not have a formal policy with respect to the consideration of any director candidates recommended by shareholders and, for the foregoing reasons, has determined that it is appropriate not to have such a formal policy at this time. The Board of Directors, however, will give due consideration to director candidates recommended by shareholders. Any shareholder that wishes to nominate a director candidate should submit complete information as to the identity and qualifications of the director candidate to the Board of Directors, including all information that would be required to be disclosed about that person in a proxy statement relating to the election of directors, at the address and in the manner set forth below for communication with the Board. Executive sessions of the independent members of the Board of Directors are held as needed and determined by those Directors at the conclusion of each of the regular board meetings, but no less than annually at the first regular Board meeting in each calendar year. The Board of Directors met four times in 2022. Each current Director attended all of the meetings of the Board and its committees of which he or she was a member during 2022. The Company does not have a formal policy regarding Director attendance at its annual meetings, but attendance by the Directors is encouraged and expected. At the Company’s 2022 annual meeting of shareholders, all of the Company’s directors were in attendance. 58 Table of Contents Shareholders may communicate with members of the Board of Directors by mail addressed to the full Board of Directors, a specific member of the Board of Directors or a particular committee of the Board of Directors, at Atlantic American Corporation, 4370 Peachtree Road, N.E., Atlanta, Georgia 30319. Delinquent Section 16(a) Reports Section 16(a) of the Exchange Act (as defined below) requires our directors and executive officers, and persons who beneficially own more than 10% of our Common Stock, to file with the SEC reports of ownership and changes in ownership of our equity securities. Based upon review of such reports and written representations from such persons, we believe all filing requirements were complied with in a timely manner during 2022, except for one late Form 4 filed on December 19, 2022 by Joseph M. Scheerer reporting the acquisition of a grant of restricted stock. Code of Business Conduct and Ethics The Company has adopted a Code of Business Conduct and Ethics that applies to its principal executive officer, principal financial officer, principal accounting officer or controller, or any persons performing similar functions, as well as its directors and other employees. A copy of this Code of Business Conduct and Ethics has been filed as an exhibit to this annual report on Form 10-K. ITEM 11. EXECUTIVE COMPENSATION 2022 Summary Compensation Table There is shown below information concerning the annual compensation for services in all capacities to the Company and its subsidiaries for the fiscal years ended December 31, 2022 and 2021 by the: (i) Chairman, President and Chief Executive Officer of the Company and (ii) the Chief Financial Officer of the Company, who are the only executive officers of the Company (together, the “named executive officers”): Name and Principal Position Year Salary ($) Bonus ($) (1) Stock Awards ($) All Other Compensation ($) Total ($) (2) Hilton H. Howell, Jr. 2022 550,000 800,000 -0- 122,516 (3) 1,472,516 Chairman of the Board, 2021 541,667 675,000 -0- 102,166 1,318,833 President and CEO J. Ross Franklin 2022 363,825 300,000 -0- 52,751 (4) 716,576 Vice President, 2021 341,250 250,000 -0- 50,762 642,012 CFO and Secretary (1) Discretionary bonuses awarded by the Stock Option and Compensation Committee. (2) For Mr. Howell, does not include amounts he may be deemed to have received pursuant to certain related party transactions described below under “Certain Relationships and Related Person Transactions.” (3) Includes fees paid in cash for serving as a director of the Company and subsidiaries of $95,000 ($50,000 of which would otherwise be reported in the “Fees Earned or Paid in Cash” column of the 2022 Director Compensation Table below) and 401(k) plan employer contributions of $27,450. (4) Includes fees paid in cash for serving as a director of subsidiaries of $18,000 and 401(k) plan employer contributions of $33,855. Additional Narrative Disclosure Retirement Benefits The Company offers a tax-qualified 401(k) plan to its employees, under which participating employees may contribute a portion of their eligible compensation into their plan accounts. Each of the named executive officers was eligible to participate in the 401(k) plan during fiscal 2022. The Company makes matching contributions under the 401(k) plan equal to 35% of up to the first 6% of employee contributions, subject to tax-based limitations. 59 Table of Contents Severance and Change in Control Compensation The Company does not have any arrangements in place with the named executive officers that provide for payments in connection with their termination of service or a change in control of the Company. Outstanding Equity Awards at 2022 Fiscal Year-End The named executive officers did not hold any outstanding equity awards as of December 31, 2022. Stock Awards Name # of Shares or Units of Stock That Have Not Vested Market Value of Shares or Units of Stock That Have Not Vested ($) Equity Incentive Plan Awards: # of Unearned Shares, Units or Other Rights That Have Not Vested Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights that Have Not Vested ($) Hilton H. Howell, Jr. - - - - J. Ross Franklin - - - - Pay Versus Performance Disclosure Pay Versus Performance (1) Year (a) Summary Compensation Table (“SCT”) Total for PEO (b) Compensation Actually Paid to PEO (c)(2) Average Summary Compensation Table Total for Non-PEO Named Executive Officers (d) Average Compensation Actually Paid to Non-PEO Named Executive Officers (e)(2) Value of Initial Fixed $100 Investment Based On: Net Income (in thousands) (g)(4) Total Shareholder Return (f)(3) 2022 $ 1,472,516 $ 1,486,916 $ 716,576 $ 721,976 $ 114.85 $ 1,525 2021 $ 1,318,833 $ 1,381,765 $ 642,012 $ 665,612 $ 119.59 $ 4,281 (1) Hilton H. Howell, Jr. was our principal executive officer (“PEO”) for the full year for each of 2022 and 2021. For each of 2022 and 2021, our only non-PEO named executive officer was J. Ross Franklin. Throughout this Pay Versus Performance Disclosure, we refer to certain “average” amounts for the non-PEO named executive officers, in accordance with SEC rules. However, in each such instance, the amounts disclosed are solely with respect to Mr. Franklin. (2) For each of 2022 and 2021 (each, a “Covered Year”), in determining both the compensation actually paid (“CAP”) to our PEO and the average CAP to our non-PEO named executive officers for purposes of this Pay Versus Performance table (“PVP Table”), we deducted from or added back to the total amounts of compensation reported in column (b) or column (d) for such Covered Year the following amounts: 60 Table of Contents Item and Value Added (Deducted) 2022 2021 For Mr. Howell : - SCT “Stock Awards” column value — — - SCT “Option Awards” column value — — + year-end fair value of outstanding equity awards granted in Covered Year — — +/- change in fair value of outstanding equity awards granted in prior years — $ 10,400 + vesting date fair value of equity awards granted and vested in Covered Year — — +/- change in fair value of prior-year equity awards vested in Covered Year $ 13,867 $ 51,465 - prior year-end fair value of prior-year equity awards forfeited in Covered Year — — + includable dividends/earnings on equity awards during Covered Year $ 533 $ 1,067 For Non-PEO Named Executive Officers (Average): - SCT “Stock Awards” column value — — - SCT “Option Awards” column value — — + year-end fair value of outstanding equity awards granted in Covered Year — — +/- change in fair value of outstanding equity awards granted in prior years — $ 3,900 + vesting date fair value of equity awards granted and vested in Covered Year — — +/- change in fair value of prior-year equity awards vested in Covered Year $ 5,200 $ 19,300 - prior year-end fair value of prior-year equity awards forfeited in Covered Year — — + includable dividends/earnings on equity awards during Covered Year $ 200 $ 400 (3) For each Covered Year, our total shareholder return was calculated as the yearly percentage change in our cumulative total shareholder return on our common stock, par value $1.00 per share, measured as the quotient of (a) the sum of (i) the cumulative amount of dividends for a period beginning with our closing price on the NASDAQ Global Market on December 31, 2020 through and including the last day of the fiscal year covered (each one-year and two-year period, the “Measurement Period”), assuming dividend reinvestment, plus (ii) the difference between our closing stock price at the end versus the beginning of the Measurement Period, divided by (b) our closing share price at the beginning of the Measurement Period. Each of these yearly percentage changes was then applied to a deemed fixed investment of $100 at the beginning of the Measurement Period to produce the Covered Year-end values of such investment as of the end of 2022 and 2021, as applicable. Because Covered Years are presented in the table in reverse chronological order (from top to bottom), the table should be read from bottom to top for purposes of understanding cumulative returns over time. (4) Net income is calculated in accordance with United States Generally Accepted Accounting Principles. The following charts provide, across the Covered Years, descriptions of the relationships between (1) the CAP to the PEO and the average of the CAP to our non-PEO named executive officers (in each case as set forth in the PVP Table above) and (2) each of the performance measures set forth in columns (f) and (g) of the PVP Table above. Compensation of Directors Effective in November 2022, the Company increased its compensation program for members of the Board from a cash payment of $10,000 per Board meeting and $1,000 per committee meeting attended, to $20,000 for each Board meeting attended, whether in person or telephonically, and $2,000 for each committee meeting attended, whether in person or telephonically. In addition, Directors are reimbursed for actual expenses incurred in connection with attending meetings of the Board and/or committees of the Board. Pursuant to the Company’s 2022 Plan, Directors are eligible to receive stock options to purchase shares of Common Stock and other equity awards. In 2022, each of our non-employee Directors received a grant of restricted stock valued at $30,600, which vested in full on May 8, 2023. The following table provides information about the compensation paid or granted for services as a director of the Company for the year ended December 31, 2022. Mr. Howell also served as a director of the Company during 2022. He did not receive any stock awards for such service, but did receive cash fees for his attendance at Board meetings. See the “Summary Compensation Table” above for information on the total compensation paid to Mr. Howell for all services provided to the Company and its subsidiaries. 61 Table of Contents 2022 Director Compensation Name Fees Earned or Paid in Cash ($) Stock Awards ($) (1) All Other Compensation ($) Total ($) Robin R. Howell 50,000 30,600 -0- 80,600 (2) Mark E. Preisinger 55,000 30,600 -0- 85,600 Joseph M. Scheerer 55,000 30,600 -0- 85,600 Scott G. Thompson 50,000 -0- -0- (3) 50,000 D. Keehln Wheeler 55,000 30,600 -0- 85,600 (1) Grant date fair value of stock awards calculated in accordance with the Financial Accounting Standards Board’s Accounting Standards Codification Topic 718. For a discussion of assumptions underlying the value of equity incentive awards, see note 10 of the notes to the audited financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022. As of December 31, 2022, each of the Company’s non-employee directors held 10,000 shares of restricted stock. (2) Does not include amounts deemed received pursuant to certain related transactions and described below in “Certain Relationships and Related Person Transactions.” (3) For Mr. Thompson, excludes compensation received as an employee of a subsidiary of the Company. ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS Equity Compensation Plan Information The following table sets forth, as of December 31, 2022, the number of securities issuable upon exercise of outstanding options, warrants and rights, the weighted average exercise price thereof and the number of securities remaining available for future issuance under the Company’s equity compensation plans: Plan Category Number of Securities to Be Issued Upon Exercise of Outstanding Options, Warrants and Rights Weighted-Average Exercise Price of Outstanding Options, Warrants and Rights Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in the First Column) Equity compensation plans approved by security holders — $ — 2,960,000 Equity compensation plans not approved by security holders (1) — — — Total — $ — 2,960,000 (1) All the Company’s equity compensation plans have been approved by the Company’s shareholders. Security Ownership of Certain Beneficial Owners and Management The following table sets forth ownership information regarding our outstanding equity securities as of June 12, 2023 by: (i) each person who is known to the Company to beneficially own more than 5% of the outstanding shares of Common Stock of the Company; (ii) each Director; (iii) each executive officer named in the Summary Compensation Table above; and (iv) all of the Company’s Directors and executive officers as a group. The address of each such person and entities controlled by such person is: c/o Atlantic American Corporation, 4370 Peachtree Road, N.E., Atlanta, Georgia 30319. Common Stock (1) Series D Preferred Stock (1) Name of Stockholder Number of Shares Percent of Class Number of Shares Percent of Class Harriett J. Robinson 15,217,583 (2) 74.57 % 55,000 (2) 100 % Hilton H. Howell, Jr. 835,119 (3) 4.09 % - - Robin R. Howell 3,988,356 (4) 19.54 % - - Mark E. Preisinger 20,000 (5) * - - Joseph M. Scheerer 30,000 (5) * - - Scott G. Thompson 145,959 * - - D. Keehln Wheeler 30,000 (5) * - - J. Ross Franklin 36,979 * - - All directors and executive officers as a group (8 persons) 16,315,640 (6) 79.95 % 55,000 100 % *Represents less than one percent. (1) All shares of stock are owned “beneficially” as set forth in the rules of the SEC. Under those rules, a person is deemed to be a “beneficial owner” of a security if that person has or shares “voting power,” which includes the power to vote or to direct the voting of such security, or “investment power,” which includes the power to dispose of, or to direct the disposition of, such security. The person is also deemed to be a beneficial owner of any security of which that person has a right to acquire beneficial ownership (such as by exercise of options) within 60 days. Under such rules, more than one person may be deemed to be a beneficial owner of the same securities, and a person may be deemed to be a beneficial owner of securities as to which he or she may disclaim any beneficial interest. Except as indicated in other notes to this table, directors and executive officers possessed sole voting and investment power with respect to all shares of stock referred to in the table. Except upon the occurrence of certain events, shares of Series D preferred stock, par value $1.00 per share (the “Series D Preferred Stock”), are not entitled to any vote, whereas each share of Common Stock entitles its holder to one vote. The shares of Series D Preferred Stock are not currently convertible, but may become convertible into shares of Common Stock under certain conditions. 62 Table of Contents (2) Includes: 8,047,048 shares of Common Stock held in trust for her children, with respect to which she serves as trustee; 919,721 shares of Common Stock held in trust for her grandchildren, with respect to which she serves as trustee; 5,120,555 shares of Common Stock owned by Gulf Capital Services, LLLP; and 55,000 shares of Series D Preferred Stock owned by Delta Life Insurance Company (“Delta Life”); all of which entities are controlled by Mrs. Robinson. (3) Includes: 283,772 shares held pursuant to the Company’s 401(k) Plan; and 34,075 shares owned directly or indirectly by his wife, excluding shares held in a trust for her benefit over which she does not have voting or dispositive power. (4) Includes: 3,954,281 shares held in a trust for her benefit over which Harriett J. Robinson serves as trustee; 2,175 shares held in an individual retirement account; and 10,000 shares of restricted stock as to which the holder has voting, but not dispositive power. Does not include any shares held by Mr. Howell (see note 3 above). (5) Includes 10,000 shares of restricted stock as to which the holder has voting, but not dispositive power. (6) See notes 2 through 5 above. The information required to be disclosed in this Item 12 by Item 201(d) of Regulation S-K is included in Item 5 “Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities” in the Form 10-K. ITEM 13. CERTAIN RELATIONSHIPS AND RELATED PERSON TRANSACTIONS AND DIRECTOR INDEPENDENCE The Company currently leases space for its principal offices, as well as the principal offices of certain of its subsidiaries, from 4370 Peachtree LLC. 4370 Peachtree LLC is controlled by Harriett J. Robinson, a former member of our Board of Directors. During 2022, the Company leased such space from Delta Life. In December of 2022, ownership of the office building was transferred from Delta Life to 4370 Peachtree LLC. In addition, Mr. Howell and Mrs. Howell are officers, directors and/or shareholders in Delta Life. Under the terms of the lease, the Company pays annual rent of approximately $0.5 million, plus a pro rata share of all real estate taxes, general maintenance and service expenses and insurance costs with respect to the office building and related facilities. The lease does not have a set termination date, but is terminable by either party with at least twelve months advance notice. In 2022, the Company paid approximately $0.9 million to Delta Life under the terms of the lease. In 2022, Gray Television, Inc. (“Gray”) paid the Company approximately $1.7 million in insurance premiums related to certain voluntary employee benefits plans. Mr. Howell is the executive chairman and chief executive officer, and a director, and Mrs. Howell is a director, of Gray. The Company has outstanding 55,000 shares of its Series D Preferred Stock, all of which is owned by Delta Life. The outstanding shares of Series D Preferred Stock have a par value of $1 per share and redemption value of $100 per share; accrue annual dividends at a rate of $7.25 per share (payable in cash or shares of the Company’s common stock at the option of the Board of Directors of the Company) and are cumulative; in certain circumstances may be convertible into an aggregate of approximately 1,378,000 shares of Common Stock, subject to certain adjustments and provided that such adjustments do not result in the Company issuing more than approximately 2,703,000 shares of common stock without obtaining prior shareholder approval; and are redeemable solely at the Company’s option. The Series D Preferred Stock is not currently convertible. The Company had accrued, but unpaid, dividends, on the Series D Preferred Stock of $17,722 at December 31, 2022. During 2022, the Company paid Series D Preferred Stock dividends of $0.4 million. Information regarding the independence of the members of our Board of Directors is contained above under the heading “ITEM 10. Directors, Executive Officers and Corporate Governance – Committees of the Board of Directors.” ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES The Company’s independent registered public accounting firm for the Company’s 2022 fiscal year end was FORVIS, LLP (“FORVIS”) and for the 2021 fiscal year was Dixon Hughes Goodman LLP (“DHG”). DHG, the Company’s prior independent registered public accounting firm, completed its previously announced merger with BKD, LLP, effective June 1, 2022. Following the merger, the combined firm now operates under the name FORVIS. 63 Table of Contents Amounts paid to, or billed by, the Company’s independent registered public accounting firms, during the two most recent fiscal years by category were as follows: Audit Fees The Company has paid or expects to pay FORVIS (as successor to DHG) approximately $ 726 ,000, in the aggregate, for professional services it rendered for the audit of the Company’s consolidated financial statements and audits of subsidiary company statutory reports for the fiscal year ended December 31, 2022 and the reviews of the interim financial statements included in our quarterly reports on Form 10-Q filed during the fiscal year ended December 31, 2022. The Company paid DHG approximately $450,000, in the aggregate, for professional services it rendered for the audit of the Company’s consolidated financial statements and audits of subsidiary company statutory reports for the fiscal year ended December 31, 2021 and the reviews of the interim financial statements included in our quarterly reports on Form 10-Q during the fiscal year ended December 31, 2021. Audit-Related Fees The Company has paid or expects to pay FORVIS (as successor to DHG) approximately $30,000 to audit the December 31, 2022 financial statements of The Atlantic American Corporation 401(k) Retirement Savings Plan (the “Plan”). During the fiscal year ended December 31, 2022, the Company paid DHG approximately $28,000 to audit the December 31, 2021 financial statements of the Plan. During the fiscal year ended December 31, 2021, the Company paid DHG approximately $26,000 for the audit of the December 31, 2020 financial statements of the Plan. Tax Fees There were no tax fees paid to FORVIS or DHG in 2022 or 2021. All Other Fees Neither FORVIS nor DHG provided any other category of products and services to the Company during the fiscal years ended December 31, 2022 or 2021 and, accordingly, no other fees were paid thereto in either 2022 or 2021. The Audit Committee considers whether the provision of non-audit services by the Company’s independent registered public accounting firm is compatible with maintaining auditor independence. All audit and non-audit services to be performed by the Company’s independent registered public accounting firm must be, and for 2022 and 2021 were, approved in advance by the Audit Committee. Pursuant to the Audit Committee’s Audit and Non-Audit Services Pre-Approval Policy (the “Policy”) and as permitted by SEC rules, the Audit Committee may delegate pre-approval authority to any of its members, provided that any service approved in this manner is reported to the full Audit Committee at its next meeting. The Policy provides for a general pre-approval of certain specifically enumerated services that are to be provided within specified fee levels. With respect to requests to provide specifically enumerated services not specifically pre-approved pursuant to such general grant, such requests must be submitted to the Audit Committee by both the independent registered public accounting firm and the CFO, and must include a joint statement as to whether, in their view, the request is consistent with SEC rules on auditor independence. Such requests must also be specific as to the nature of the proposed service, the proposed fee and any other details the Audit Committee may request. 64 Table of Contents PART IV Item 15. Exhibits and Financial Statement Schedules (a) List of documents filed as part of this report: 1. Financial Statements: See Index to Financial Statements contained in Item 8 hereof. 2. Financial Statement Schedules: Schedule II - Condensed financial information of the registrant Schedule III - Supplementary insurance information of the registrant Schedule IV - Reinsurance information for the registrant Schedule VI - Supplemental information concerning property-casualty insurance operations of the registrant Schedules other than those listed above are omitted as they are not required or are not applicable, or the required information is shown in the financial statements or notes thereto. Columns omitted from schedules filed have been omitted because the information is not applicable. 3. Exhibits *: 3.1 Restated Articles of Incorporation of the registrant, as amended [incorporated by reference to Exhibit 3.1 to the registrant’s Form 10-K for the year ended December 31, 2008]. 3.2 Restated Bylaws of the registrant, as amended [incorporated by reference to Exhibit 3.1 to the registrant’s Form 8-K filed on March 4, 2016]. 4.1 Description of the registrant’s common stock registered pursuant to section 12 of the Securities Exchange Act of 1934 [incorporated by reference to Exhibit 4.1 to the registrant’s Form 10-K filed on March 24, 2020]. 10.01 Management Agreement, dated July 1, 1993, between the registrant and Atlantic American Life Insurance Company and Bankers Fidelity Life Insurance Company [incorporated by reference to Exhibit 10.41 to the registrant’s Form 10-Q for the quarter ended September 30, 1993]. 10.02 Tax Allocation Agreement, dated as of January 4, 2016, between the registrant and the registrant’s subsidiaries [incorporated by reference to Exhibit 10.02 to the registrant’s Form 10-K for the year ended December 31, 2017]. 10.03** Atlantic American Corporation 2012 Nonqualified Stock Purchase Plan [incorporated by reference to Exhibit 99.1 to the registrant’s Form S-8 (File No. 333-183207) filed on August 10, 2012]. 10.04** Atlantic American Corporation 2012 Equity Incentive Plan [incorporated by reference to Exhibit 10.1 to the registrant’s Form 10-Q for the quarter ended March 31, 2013]. 10.05 Lease Agreement, dated as of November 1, 2007, between Georgia Casualty & Surety Company, Bankers Fidelity Life Insurance Company, Atlantic American Corporation and Delta Life Insurance Company [incorporated by reference to Exhibit 10.10 to the registrant’s Form 10-K for the year ended December 31, 2007]. 10.06 First Amendment to Lease Agreement, dated as of March 31, 2008, between Georgia Casualty & Surety Company, Bankers Fidelity Life Insurance Company, Atlantic American Corporation and Delta Life Insurance Company [incorporated by reference to Exhibit 10.2 to the registrant’s Form 10-Q for the quarter ended March 31, 2008]. 10.07 Assignment and Assumption of Leases and Contracts, dated as of December 21, 2022, by and between Delta Life Insurance Company and 4370 Peachtree LLC. 10.08** Employment and Transition Agreement with Fixed Determination Date, dated as of June 14, 2017 by and between John G. Sample, Jr. and the registrant [incorporated by reference to Exhibit 10.07 to the registrant’s Form 10-K for the year ended December 31, 2017]. 10.09 Revolving Credit Agreement, dated as of May 12, 2021, by and between Atlantic American Corporation and Truist Bank [incorporated by reference to Exhibit 10.1 to the registrant’s Form 8-K filed with the SEC on May 13, 2021]. 10.10** Atlantic American Corporation 2022 Equity and Incentive Compensation Plan [incorporated by reference to Exhibit 10.1 to the registrant’s Form 8-K filed on May 31, 2022]. 14.1 Code of Business Conduct and Ethics [incorporated by reference to Exhibit 14.1 to the registrant’s Form 10-K for the year ended December 31, 2003]. 21.1 Subsidiaries of the registrant [incorporated by reference to Exhibit 21.1 to the registrant’s Form 10-K for the year ended December 31, 2015]. 23.1 Consent of FORVIS LLP, Independent Registered Public Accounting Firm. 31.1 Certification of the Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 65 Table of Contents 31.2 Certification of the Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 32.1 Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 101.INS Inline 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. 101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase. 101.DEF Inline XBRL Taxonomy Extension Definition Linkbase. 101.LAB Inline XBRL Taxonomy Extension Label Linkbase. 101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase. 104 Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101). * The registrant agrees to furnish to the Commission upon request a copy of any instruments defining the rights of security holders of the registrant that may be omitted from filing in accordance with the Commission’s rules and regulations. ** Management contract, compensatory plan or arrangement. Item 16. Form 10-K Summary None. 66 Table of Contents SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. ATLANTIC AMERICAN CORPORATION (Registrant) By: /s/ J. Ross Franklin J. Ross Franklin Vice President and Chief Financial Officer Date: June 30, 2023 Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. Signature Title Date /s/ Hilton H. Howell, Jr. President, Chief Executive Officer and Chairman of the Board (Principal Executive Officer) June 30, 2023 HILTON H. HOWELL, JR. /s/ J. Ross Franklin Vice President and Chief Financial Officer (Principal Financial and Accounting Officer) June 30, 2023 J. ROSS FRANKLIN /s/ Robin R. Howell Director June 30, 2023 ROBIN R. HOWELL /s/ Mark E. Preisinger Director June 30, 2023 MARK E. PREISINGER /s/ Joseph M. Scheerer Director June 30, 2023 JOSEPH M. SCHEERER /s/ Scott G. Thompson Director June 30, 2023 SCOTT G. THOMPSON /s/ D. Keehln Wheeler Director June 30, 2023 D. KEEHLN WHEELER 67 Table of Contents Schedule II Page 1 of 3 CONDENSED FINANCIAL INFORMATION OF REGISTRANT ATLANTIC AMERICAN CORPORATION (Parent Company Only) BALANCE SHEETS ASSETS December 31, 2022 2021 (In thousands) Cash and cash equivalents $ 2,680 $ 1,718 Investments 2,278 2,749 Investment in subsidiaries 113,079 164,535 Investments in unconsolidated trusts 1,238 1,238 Deferred tax asset, net 14,163 1,237 Income taxes receivable from subsidiaries 1,951 2,171 Other assets 6,681 5,791 Total assets $ 142,070 $ 179,439 LIABILITIES AND SHAREHOLDERS’ EQUITY Other payables $ 4,130 $ 4,415 Revolving credit facility 2,009 — Junior subordinated debentures 33,738 33,738 Total liabilities 39,877 38,153 Shareholders’ equity 102,193 141,286 Total liabilities and shareholders’ equity $ 142,070 $ 179,439 See accompanying report of independent registered public accounting firm. 68 Table of Contents Schedule II Page 2 of 3 CONDENSED FINANCIAL INFORMATION OF REGISTRANT ATLANTIC AMERICAN CORPORATION (Parent Company Only) STATEMENTS OF OPERATIONS Year Ended December 31, 2022 2021 (In thousands) REVENUE Fee income from subsidiaries $ 7,624 $ 7,380 Distributed earnings from subsidiaries 7,200 8,400 Unrealized gains (losses) on equity securities, net ( 484 ) 230 Other 93 ( 247 ) Total revenue 14,433 15,763 GENERAL AND ADMINISTRATIVE EXPENSES 13,583 13,654 INTEREST EXPENSE 1,952 1,387 ( 1,102 ) 722 INCOME TAX BENEFIT (1) ( 3,934 ) ( 2,840 ) 2,832 3,562 EQUITY IN UNDISTRIBUTED EARNINGS OF SUBSIDIARIES, NET ( 1,307 ) 719 NET INCOME $ 1,525 $ 4,281 (1) Under the terms of a tax-sharing agreement, income tax provisions for the subsidiary companies are computed on a separate company basis. Accordingly, the Company’s income tax benefit results from the utilization of the Parent’s separate return loss to reduce the consolidated taxable income of the Company. See accompanying report of independent registered public accounting firm. 69 Table of Contents Schedule II Page 3 of 3 CONDENSED FINANCIAL INFORMATION OF REGISTRANT ATLANTIC AMERICAN CORPORATION (Parent Company Only) STATEMENTS OF CASH FLOWS Year Ended December 31, 2022 2021 (In thousands) CASH FLOWS FROM OPERATING ACTIVITIES: Net Income $ 1,525 $ 4,281 Adjustments to reconcile net income to net cash provided by operating activities: Unrealized losses (gains) on equity securities, net 484 ( 230 ) Depreciation and amortization 515 538 Compensation expense related to share awards 134 211 Earnings from equity method investees ( 294 ) — Equity in undistributed earnings of subsidiaries, net 1,307 ( 719 ) Decrease (increase) in intercompany taxes 220 ( 489 ) Deferred income tax benefit ( 2,336 ) ( 1,058 ) (Decrease) increase in accounts payable and accrued expenses ( 285 ) 63 Other, net ( 1,348 ) ( 1,966 ) Net cash (used in) provided by operating activities ( 78 ) 631 CASH FLOWS FROM INVESTING ACTIVITIES: Additions to property and equipment ( 45 ) ( 49 ) Net cash used in investing activities ( 45 ) ( 49 ) CASH FLOWS FROM FINANCING ACTIVITIES: Payment of dividends on Series D preferred stock ( 399 ) ( 399 ) Payment of dividends on common stock ( 408 ) ( 408 ) Proceeds from shares issued under stock plans — 6 Proceeds from revolving credit facility, net 2,000 — Treasury stock acquired — net employee share-based compensation ( 108 ) ( 153 ) Net cash provided by (used in) financing activities 1,085 ( 954 ) Net increase (decrease) in cash 962 ( 372 ) Cash and cash equivalents at beginning of year 1,718 2,090 Cash and cash equivalents at end of year $ 2,680 $ 1,718 Supplemental disclosure: Cash paid for interest $ 1,794 $ 1,389 Cash paid for income taxes $ 2,764 $ 3,202 Intercompany tax settlement from subsidiaries $ 3,946 $ 6,734 See accompanying report of independent registered public accounting firm. 70 Table of Contents Schedule III Page 1 of 2 ATLANTIC AMERICAN CORPORATION AND SUBSIDIARIES SUPPLEMENTARY INSURANCE INFORMATION Segment Deferred Acquisition Costs Future Policy Benefits, Losses, Claims and Loss Reserves Unearned Premiums Other Policy Claims and Benefits Payable (In thousands) December 31, 2022 : Bankers Fidelity $ 39,880 $ 110,238 $ 2,814 $ 1,255 American Southern 2,401 62,810 25,534 — $ 42,281 $ 173,048 (1) $ 28,348 $ 1,255 December 31, 2021 : Bankers Fidelity $ 36,308 $ 115,712 $ 3,689 $ 1,360 American Southern 2,390 57,256 23,780 — $ 38,698 $ 172,968 (2) $ 27,469 $ 1,360 (1) Includes future policy benefits of $ 85,564 and losses and claims of $ 87,484 . (2) Includes future policy benefits of $ 87,348 and losses and claims of $ 85,620 . See accompanying report of independent registered public accounting firm. 71 Table of Contents Schedule III Page 2 of 2 ATLANTIC AMERICAN CORPORATION AND SUBSIDIARIES SUPPLEMENTARY INSURANCE INFORMATION Segment Premium Revenue Net Investment Income Benefits, Claims, Losses and Settlement Expenses Amortization of Deferred Acquisition Costs Other Operating Expenses Casualty Premiums Written (In thousands) December 31, 2022 : Bankers Fidelity $ 115,164 $ 5,414 $ 76,281 $ 9,295 $ 24,627 $ — American Southern 70,276 4,147 47,175 10,150 10,011 72,671 Corporate & other — 371 — — 8,216 — $ 185,440 $ 9,932 $ 123,456 $ 19,445 $ 42,854 $ 72,671 December 31, 2021 : Bankers Fidelity $ 116,234 $ 5,204 $ 87,261 $ 13,465 $ 21,250 $ — American Southern 67,982 3,570 44,433 10,599 9,544 69,403 Corporate & other — ( 246 ) — — 7,700 — $ 184,216 $ 8,528 $ 131,694 $ 24,064 $ 38,494 $ 69,403 See accompanying report of independent registered public accounting firm. 72 Table of Contents Schedule IV ATLANTIC AMERICAN CORPORATION AND SUBSIDIARIES REINSURANCE INFORMATION Direct Amount Ceded to Other Companies Assumed From Other Companies Net Amounts Percentage of Amount Assumed to Net (Dollars in thousands) Year ended December 31, 2022 : Life insurance in force $ 670,610 $ ( 9,597 ) $ — $ 661,013 Premiums — Bankers Fidelity $ 176,995 $ ( 61,839 ) $ 8 $ 115,164 0.0 % American Southern 51,844 ( 6,546 ) 24,978 70,276 35.5 % Total premiums $ 228,839 $ ( 68,385 ) $ 24,986 $ 185,440 13.5 % Year ended December 31, 2021 : Life insurance in force $ 416,480 $ ( 9,487 ) $ — $ 406,993 Premiums — Bankers Fidelity $ 183,382 $ ( 67,155 ) $ 7 $ 116,234 0.0 % American Southern 52,424 ( 6,511 ) 22,069 67,982 32.5 % Total premiums $ 235,806 $ ( 73,666 ) $ 22,076 $ 184,216 12.0 % See accompanying report of independent registered public accounting firm. 73 Table of Contents Schedule VI ATLANTIC AMERICAN CORPORATION AND SUBSIDIARIES SUPPLEMENTAL INFORMATION CONCERNING PROPERTY-CASUALTY INSURANCE OPERATIONS Claims and Claim Adjustment Expenses Incurred Related To Year Ended Deferred Policy Acquisition Costs Reserves Unearned Premiums Earned Premiums Net Investment Income Current Year Prior Years Amortization of Deferred Acquisition Costs Paid Claims and Claim Adjustment Expenses Premiums Written (In thousands) December 31, 2022 $ 2,401 $ 62,810 $ 25,534 $ 70,276 $ 4,147 $ 48,692 $ ( 1,517 ) $ 10,150 $ 42,948 $ 72,671 December 31, 2021 $ 2,390 $ 57,256 $ 23,780 $ 67,982 $ 3,570 $ 48,678 $ ( 4,245 ) $ 10,599 $ 40,370 $ 69,403 See accompanying report of independent registered public accounting firm. 74