What changed in this filing

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Item 1. Business

2024-04-01 compared with 2023-06-30 · 162 added, 190 removed, 297 unchanged (54% of the section changed)

Atlantic American Corporation, a Georgia corporation incorporated in 1968 (the “Parent” or “Company”), is a holding company that operates through its subsidiaries in well-defined specialty markets

within the life and health and property and casualty insurance industries.

The Parent’s principal operating subsidiaries are American Southern Insurance Company and American Safety Insurance Company (together known as “American Southern”) within

the property and casualty insurance industry and Bankers Fidelity Life Insurance Company, Bankers Fidelity Assurance Company and Atlantic Capital Life Assurance Company (together known as “Bankers Fidelity”) within the life and health insurance

Atlantic American Corporation, a Georgia corporation incorporated in 1968 (the “Parent” or “Company”), is a holding company that operates through its subsidiaries in well-defined specialty

markets within the life and health and property and casualty insurance industries.

The Parent’s principal operating subsidiaries are American Southern Insurance Company and American Safety Insurance Company (together known as “American Southern”)

within the property and casualty insurance industry and Bankers Fidelity Life Insurance Company, Bankers Fidelity Assurance Company and Atlantic Capital Life Assurance Company (together known as “Bankers Fidelity”) within the life and health

insurance industry.

Each of American Southern and Bankers Fidelity is managed separately based upon the type of products it offers and is evaluated on its individual performance.

The Company’s strategy is to focus on well-defined geographic, demographic

and/or product niches within the insurance marketplace.

The Company’s strategy is to focus on well-defined geographic,

demographic and/or product niches within the insurance marketplace.

Each of American Southern and Bankers Fidelity operates with relative autonomy, which structure is designed to allow for quick reaction to market opportunities.

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American Southern comprises the Company’s property and casualty operations and its primary product lines are as follows:

Business Automobile Insurance policies provide bodily injury and/or property damage liability coverage, uninsured motorist coverage and physical

damage coverage for commercial accounts.

General Liability Insurance policies cover bodily injury and/or property damage liability for both premises and completed operations exposures for

general classes of business.

Surety Bonds are contracts under which one party, the insurance company issuing the surety bond, guarantees to a third party that the primary party

will fulfill an obligation in accordance with a contractual agreement.

This obligation may involve meeting a contractual commitment, paying a debt or performing certain duties.

American Southern provides tailored business automobile insurance coverage, on a multi-year contract basis, to state governments, local municipalities and other large motor pools and fleets (“block

accounts”) that can be specifically rated and underwritten.

The size of the block accounts insured by American Southern are generally such that individual class experience can be determined, which allows for customized policy terms and rates.

Commercial Automobile Insurance policies provide bodily injury and/or property damage liability coverage, uninsured motorist coverage and physical damage coverage for commercial accounts.

General Liability Insurance policies cover bodily injury and/or property damage liability for both premises and completed operations exposures for general classes of business.

Surety Bonds are

contracts under which one party, the insurance company issuing the surety bond, guarantees to a third party that the primary party will fulfill an obligation in accordance with a contractual agreement.

This obligation may involve meeting a

contractual commitment, paying a debt or performing certain duties.

American Southern provides tailored commercial automobile insurance coverage, on a multi-year contract basis, to state governments, local municipalities and other large motor pools and fleets

(“block accounts”) that can be specifically rated and underwritten.

The size of the block accounts insured by American Southern are generally such that individual class experience can be determined, which allows for customized policy terms and

American Southern is licensed to do business in 32 states and the District of Columbia.

While the majority of American Southern’s premiums are derived from its automobile lines of business, American Southern also offers inland marine and general

liability coverages.

While the majority of American Southern’s premiums are derived from its automobile lines of business, American Southern also offers general liability

and other lines such as inland marine coverage.

Additionally, American Southern directly provides surety bond coverage for subdivision construction, school bus contracts, as well as performance and payment bonds.

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insurance, Medicare supplement and other accident and health insurance products.

Life Insurance products include non-participating, individual and group whole life insurance policies with a variety of riders and options.

premiums are dependent upon a number of factors, including issue age, level of coverage and selected riders or options.

Medicare Supplement Insurance includes 8 of the 10 standardized Medicare supplement policies created under the Medicare Improvements for Patients and

Providers Act of 2008 (“MIPPA”), which are designed to provide insurance coverage for certain expenses not covered by the Medicare program, including copayments and deductibles.

Other Accident and Health Insurance coverages include several individual and group policies providing for the payment of standard benefits in

connection with the treatment of diagnosed cancer and other critical illnesses, as well as a number of other policies providing short-term nursing facility care, accident expense, hospital indemnity and disability coverages.

Life Insurance products

include non-participating, individual and group whole life insurance policies with a variety of riders and options.

Policy premiums are dependent upon a number of factors, including issue age, level of coverage and selected riders or options.

Medicare Supplement Insurance includes 8 of the 10 standardized Medicare supplement policies created under the Medicare Improvements for Patients and Providers Act of 2008 (“MIPPA”), which are designed to provide insurance coverage for certain expenses not covered

by the Medicare program, including copayments and deductibles.

Other Accident and Health Insurance coverages include several individual and group policies providing for the payment of standard benefits in connection with the treatment of diagnosed cancer and other critical illnesses, as well as a number of other policies

providing short-term nursing facility care, accident only, hospital indemnity and disability coverages.

Health insurance products, primarily Medicare supplement insurance, accounted for 83% of Bankers Fidelity’s net earned premiums in 2023 while life insurance, including both whole and term life

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Senior management carefully reviews all new programs prior to acceptance.

Most of American Southern’s agents are paid an up-front commission with the potential for additional commissions

by participating in a profit sharing arrangement that is directly linked to the profitability of the underlying business.

American Southern also solicits business from governmental entities.

As an experienced writer of insurance policies for

certain governmental programs, the company actively pursues this market on a direct basis.

American Southern solicits business through multiple channels.

Most of American Southern’s agents are paid an

up-front commission with the potential for additional commissions by participating in a profit sharing arrangement that is directly linked to the profitability of the underlying business.

American Southern also solicits business from governmental

As an experienced writer of insurance policies for certain governmental programs, the company actively pursues this market on a direct basis.

Much of this business is priced by means of competitive bid situations.

As a result, there can be no assurance with respect to the ultimate profitability or

ability of the Company to obtain or retain such business at the time of a specific contract renewal.

As a result, there can

be no assurance with respect to the ultimate profitability or ability of the Company to obtain or retain such business at the time of a specific contract renewal.

Life and Health Operations

Bankers Fidelity acquires its clientele through three distribution channels spread across 46 different states and two business divisions, all of which utilize commissioned, independent agents.

three distribution channels include traditional independent agents, brokers typically interested in a specific product of Bankers Fidelity and brokers who focus on sales within the group/employer benefits division, Atlantic American Employee

The three distribution channels include traditional independent agents, brokers typically interested in a specific product of Bankers Fidelity and brokers who focus on sales within the group/employer benefits division, Atlantic American Employee

Benefits, all of which are responsible for their own marketing and sales activities.

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Bankers Fidelity had approximately 4,639 licensed agents contracted in both the individual and group divisions as of December 31, 2023.

During 2022, approximately 476 of these licensed agents wrote

policies on behalf of Bankers Fidelity.

During 2023, approximately 454 of these licensed agents

wrote policies on behalf of Bankers Fidelity.

Bankers Fidelity’s marketing and distribution strategy revolves around five pillars:

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Diversification .

Through unique product offerings such as the Vantage Flex Plus®, a hospital indemnity plan, and Vantage Recovery®, short-term care product

and a group whole life product featuring a chronic illness rider, the Company is able to offer its distributors an array of products to sell that stand out from the competition.

As the Company continues to expand its geographical footprint with

agents and products, one of its main objectives is to have a healthy mix of all of its product lines nationwide.

Through unique

product offerings such as the Vantage Flex Plus®, a hospital indemnity plan, and Vantage Recovery®, short-term care product and a group whole life product featuring a chronic illness rider, the Company is able to offer its distributors an array

of products to sell that stand out from the competition.

As the Company continues to expand its geographical footprint with agents and products, one of its main objectives is to have a healthy mix of all of its product lines nationwide.

Differentiation .

Bankers Fidelity prides itself on the quality of customer service it offers to policyholders and agents.

A dedicated agent support team is

available to the field to support them on administration, underwriting, sales training, product questions and a plethora of other services which differentiates the Company from other carriers.

Additionally, a customer loyalty team is available

solely to serve insureds for any of their insurance needs.

Bankers Fidelity prides itself on being agile, which we believe differentiates us from larger carriers and helps the Company to quickly execute senior management’s initiatives.

Bankers Fidelity is focused on being a niche carrier that delivers superior service, quality products and innovative solutions.

Sophisticated

technology and reporting allows the home office teams to work with the sales force to deliver a tailored experience and phenomenal customer service.

Through seasonal campaigns and customer outreach, the Company is focused on client retention and servicing its policyholders through all stages in

By providing its agents with an innovative product portfolio, the Company further promotes client retention by empowering its agents to continually meet the needs of our policyholders.

Fidelity prides itself on the quality of customer service it offers to policyholders and agents.

A dedicated agent support team is available to the field to support them on administration, underwriting, sales training, product questions and a

plethora of other services which differentiates the Company from other carriers.

Additionally, a customer loyalty team is available solely to serve insureds for any of their insurance needs.

Bankers Fidelity prides itself on being agile, which

we believe differentiates us from larger carriers and helps the Company to quickly execute senior management’s initiatives.

Bankers Fidelity is

focused on being a niche carrier that delivers superior service, quality products and innovative solutions.

Sophisticated technology and reporting allows the home office teams to work with the sales force to deliver a tailored experience and

phenomenal customer service.

Through seasonal

campaigns and customer outreach, the Company is focused on client retention and servicing its policyholders through all stages in their lives.

By providing its agents with an innovative product portfolio, the Company further promotes client

retention by empowering its agents to continually meet the needs of our policyholders.

Profitability .

In an effort to be sustainable in the marketplace as a long-term partner, senior management is focused on diversification, differentiation,

quality and retention to achieve profitability.

In an effort to

be sustainable in the marketplace as a long-term partner, senior management is focused on diversification, differentiation, quality and retention to achieve profitability.

Property and Casualty Operations

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The individual products are underwritten on a non-medical basis using a simplified issue approach by which an application containing a variety of health related questions is submitted.

for insurance are reviewed to determine the face amount, age, medical history and any other necessary information.

Bankers Fidelity utilizes information obtained directly from the insured, the medical claims data, prescription utilization reports

as well as telephone interviews to determine whether an applicant meets the Company’s underwriting criteria.

Bankers Fidelity may also utilize medical records and investigative services to supplement and substantiate information, as necessary.

Applications for insurance are reviewed to determine the face amount, age, medical history and any other necessary information.

Bankers Fidelity utilizes information obtained directly from the insured, the medical claims data, prescription

utilization reports as well as telephone interviews to determine whether an applicant meets the Company’s underwriting criteria.

Bankers Fidelity may also utilize medical records and investigative services to supplement and substantiate

information, as necessary.

The group products are underwritten and assessed at the group level for financial risk.

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disposition of service requests by providing toll-free access for all customers, 24-hour claim reporting services, and direct computer links with some of its largest accounts.

The Company also utilizes an automatic call distribution system designed

to ensure that inbound calls to customer service support groups are processed efficiently.

Operational data generated from this system allows management to further refine ongoing client service programs and service representative training modules.

The Company also utilizes an automatic call distribution system

designed to ensure that inbound calls to customer service support groups are processed efficiently.

Operational data generated from this system allows management to further refine ongoing client service programs and service representative

training modules.

Property and Casualty Operations

American Southern controls its claims costs by utilizing an in-house staff of claims supervisors to investigate, verify, negotiate and settle claims.

Upon notification of an occurrence purportedly

giving rise to a claim, a claim file is established.

The claims department then conducts a preliminary investigation, determines whether an insurable event has occurred and, if so, updates the file for the findings and any required reserve

Upon notification of an occurrence

purportedly giving rise to a claim, a claim file is established.

The claims department then conducts a preliminary investigation, determines whether an insurable event has occurred and, if so, updates the file for the findings and any required

reserve adjustments.

Independent adjusters and appraisers are frequently utilized to service claims which require on-site inspections.

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The majority of life and health claims are filed electronically while insureds also have the ability to download claims forms and file directly.

Insureds may also obtain claim forms by calling the

customer service group or through Bankers Fidelity’s website.

Insureds may also obtain claim forms by calling

the customer service group or through Bankers Fidelity’s website.

All of these claims are entered into the system immediately upon receipt and put into a pending status until the claim can be fully processed.

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The Company’s life and health operations generally incur losses which are more readily quantified.

Medical claims received are recorded in case reserves based on contractual

terms using the submitted billings as a basis for determination.

Medical claims received are recorded in case reserves based on

contractual terms using the submitted billings as a basis for determination.

Life claims are recorded based on contract value at the time of notification to the Company;

offset by policy reserves related to such contracts previously established.

case reserves are established by a claims processor on each individual claim and are periodically reviewed and adjusted as new information becomes known during the course of handling a claim.

Regular internal periodic reviews are also performed by

management to ensure that loss reserves are established and revised timely relative to the receipt of new or additional information.

Individual case reserves are established by a claims processor on each individual claim and are periodically reviewed and adjusted as new information becomes known during the course of handling a claim.

Regular internal periodic reviews are also

performed by management to ensure that loss reserves are established and revised timely relative to the receipt of new or additional information.

Lines of business for which loss data (e.g.

paid losses and case reserves) emerge over a long period of time are

referred to as long-tail lines of business.

paid losses and case reserves) emerge over a long period

of time are referred to as long-tail lines of business.

Lines of business for which loss data emerge more quickly are referred to as short-tail lines of business.

The Company’s long-tail line of business generally consists of its general liability coverage

while the short-tail lines of business generally consist of property and automobile coverages.

The Company’s long-tail line of business generally consists of its general

liability coverage while the short-tail lines of business generally consist of property and automobile coverages.

The Company’s actuaries regularly review reserves for both current and prior accident years using the most current claims data.

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in Critical Accounting Policies) and judgments and involve a disciplined analysis.

For most lines of business, certain actuarial methods and specific assumptions are deemed more appropriate based on the current circumstances affecting that line of

For most lines of business, certain actuarial methods and specific assumptions are deemed more appropriate based on the current circumstances affecting that line

These selections incorporate input from claims personnel and operating management on reported loss cost trends and other factors that could affect the reserve estimates.

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given accident year, the rate at which losses on long-tail lines of business emerge in the early periods is generally not as reliable an indication of ultimate losses as it would be for shorter-tail lines of business.

The estimation of reserves for

these lines of business in the early periods of loss emergence is therefore largely influenced by statistical analyses and application of prior accident years’ loss ratios, after considering changes to earned pricing, loss costs, mix of business,

ceded reinsurance and other factors that are expected to affect the estimated ultimate losses.

For later periods of loss emergence, methods which incorporate a development pattern assumption are given more weight in estimating ultimate losses.

short-tail lines of business, the emergence of paid loss and case reserves is more credible in the early periods and is more likely to be indicative of ultimate losses.

The method used to set reserves for these lines of business is based upon

utilization of a historical development pattern for reported losses.

IBNR reserves for the current year are set as the difference between the estimated fully developed ultimate losses for each year, less the established, related case reserves and

cumulative related payments.

The estimation of reserves

for these lines of business in the early periods of loss emergence is therefore largely influenced by statistical analyses and application of prior accident years’ loss ratios, after considering changes to earned pricing, loss costs, mix of

business, ceded reinsurance and other factors that are expected to affect the estimated ultimate losses.

For later periods of loss emergence, methods which incorporate a development pattern assumption are given more weight in estimating ultimate

For short-tail lines of business, the emergence of paid loss and case reserves is more credible in the early periods and is more likely to be indicative of ultimate losses.

The method used to set reserves for these lines of business is

based upon utilization of a historical development pattern for reported losses.

IBNR reserves for the current year are set as the difference between the estimated fully developed ultimate losses for each year, less the established, related case

reserves and cumulative related payments.

IBNR reserves for prior accident years are similarly determined, again relying on an indicated, historical development pattern for reported losses.

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maturity of the accident year, trends observed over the recent past and the level of volatility within a particular line of business.

In general, changes are made more quickly to recognize changes in estimates to ultimate losses in mature accident

years and less volatile lines of business.

In general, changes are made more quickly to recognize changes in estimates to ultimate losses in mature

accident years and less volatile lines of business.

The Company’s policy is to record reserves for losses and claims in amounts that represent actuarial best estimates of ultimate values.

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reserve estimates and revisions to such estimates are expected to be made in future periods.

Any such revisions could be material, and may materially adversely affect the Company’s financial condition and results of operations in any future period.

Any such revisions could be material, and may materially adversely affect the Company’s financial condition and results of operations in any future

Property and Casualty Operations

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policy and contract obligations as they are projected to come due.

Reserves for insurance policies are calculated using assumptions for interest rates, mortality rates, disablement rates, and lapse rates.

These assumptions vary by the product

type, the year the policy was issued, and other demographic information about the policyholder.

Variations in assumptions may be made from one issue year to another to reflect actual experience.

Assumptions that deviate significantly from actual

future experience, or actual results that differ significantly from our estimates, could have a materially adverse effect on our liquidity, results of operations, or financial condition.

Reserves for insurance policies are calculated using assumptions for interest rates, mortality rates, disablement rates, benefit utilization rates, and lapse rates.

assumptions vary by the product type, the year the policy was issued, and certain policyholder demographic information.

Changes in assumptions may be made from one issue year to another to reflect actual experience.

Actual future experience

that deviates significantly from the assumptions, or actual results that differ significantly from our estimates, could have a materially adverse effect on our liquidity, results of operations, or financial condition.

See Note 6 of Notes to Consolidated Financial Statements for more information on insurance reserves and policyholder funds.

The Company’s insurance subsidiaries from time to time purchase reinsurance from unaffiliated insurers and reinsurers to reduce their potential liability on individual risks and to protect against

catastrophic losses.

The Company’s insurance subsidiaries from time to time purchase reinsurance from unaffiliated insurers and reinsurers to reduce their potential liability on individual risks and to protect

against catastrophic losses.

In a reinsurance transaction, an insurance company transfers, or “cedes,” a portion or all of its exposure on insurance policies to a reinsurer.

The reinsurer assumes the exposure in return for a portion of the premiums.

ceding of insurance does not legally discharge the insurer from primary liability for the full amount of the policies written by it, and the ceding company will incur a loss if the reinsurer fails to meet its obligations under the reinsurance

The reinsurer assumes the exposure in return for a portion of the

The ceding of insurance does not legally discharge the insurer from primary liability for the full amount of the policies written by it, and the ceding company will incur a loss if the reinsurer fails to meet its obligations under the

reinsurance agreement.

Property and Casualty Operations

American Southern’s basic reinsurance treaties generally cover all claims in excess of specified per occurrence limitations.

Limits per occurrence within the reinsurance treaties are as follows:

Current limits per occurrence within the reinsurance treaties are as

Inland marine and commercial automobile physical damage - $225,000 excess of $125,000 retention;

and automobile liability and general liability - excess coverage of $2.0 million less retentions that may vary from $100,000 to $500,000 depending on

and automobile liability and general liability - excess coverage of $2.0 million less retentions that may vary from $150,000 to $500,000

depending on the account.

American Southern maintains a property catastrophe treaty with a $5.5 million limit excess of $500,000 retention.

American Southern also issues individual surety bonds with face amounts generally up to $1.5 million, and limited to $5.0

million in aggregate per account, that are not reinsured.

American Southern also issues individual surety bonds with face amounts generally up to $1.5 million, and

limited to $5.0 million in aggregate per account, that are not reinsured.

Life and Health Operations

Bankers Fidelity has entered into reinsurance contracts ceding the excess of its life retention.

Maximum retention by Bankers Fidelity on any one individual in the case of life insurance policies

At December 31, 2022, $9.6 million of the $670.6 million of life insurance in force at Bankers Fidelity was reinsured under a mix of coinsurance and yearly renewable term agreements.

Certain prior year reinsurance agreements also

remain in force although they no longer provide reinsurance for new business.

Maximum retention by Bankers Fidelity on any one individual life insurance policyholder is

As of December 31, 2023, $8.3 million of the $814.2 million of life insurance in force at Bankers Fidelity was reinsured under a combination of coinsurance and yearly renewable term agreements.

Certain prior year reinsurance agreements

also remain in force although they no longer provide reinsurance for new business.

Bankers Fidelity has also entered into a reinsurance contract ceding excess new Medicare Supplement business to General Re Life Corporation.

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liability of the reinsurer was 50% of all new Medicare Supplement business issued by the Company on amounts up to a maximum retention of $15.0 million of annualized premium.

Accordingly, $1.0 million of the Company’s $2.0 million of new annualized

Medicare supplement premium was ceded.

Accordingly, $0.8 million of the Company’s $1.5 million of new

annualized Medicare Supplement premium was ceded.

Competition for insurance products is based on many factors including premiums charged, terms and conditions of coverage, customer service, financial ratings assigned by independent rating

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Life and Health Operations

The life and health insurance business remains highly competitive and includes a large number of insurance companies, many of which are new entrants to the business of providing Medicare supplement

and other accident and health insurance products.

The life and health insurance business remains highly competitive and includes a large number of insurance companies, many of which are new entrants to the business of providing Medicare

supplement and other accident and health insurance products.

Bankers Fidelity has established itself as a trusted carrier of choice for its customers providing quality and sustainability for over 65 years.

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through commission and sales incentive arrangements, accessibility and marketing assistance, lead programs, reputation and market expertise.

Bankers Fidelity successfully competes in its chosen markets by establishing relationships with independent

agents and providing proprietary marketing initiatives as well as providing outstanding service to policyholders.

Bankers Fidelity successfully competes in its chosen markets by establishing relationships with

independent agents and providing proprietary marketing initiatives as well as providing outstanding service to policyholders.

Ratings are important measures within the insurance industry, and higher ratings are expected to have a favorable impact on the ability of a company to compete in the marketplace.

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Best”) publishes Best’s Insurance Reports, which includes assessments and ratings of all insurance companies.

Best’s financial strength ratings, which

may be revised or revoked at any time, follow a graduated scale of rating categories and notches ranging from A++ (Superior) to F (in liquidation).

Best’s ratings are based on a detailed analysis of the statutory financial condition and

operations of an insurance company compared to the industry in general.

Best’s financial strength ratings,

which may be revised or revoked at any time, follow a graduated scale of rating categories and notches ranging from A++ (Superior) to F (in liquidation).

Best’s ratings are based on a detailed analysis of the statutory financial condition

and operations of an insurance company compared to the industry in general.

American Southern.

American Southern Insurance Company and its wholly-owned subsidiary, American Safety Insurance Company, are each, as of the date of this

report, rated “A” (Excellent) by A.M.

Southern Insurance Company and its wholly-owned subsidiary, American Safety Insurance Company, are each, as of the date of this report, rated “A” (Excellent) by A.M.

Bankers Fidelity.

Bankers Fidelity Life Insurance Company and its wholly-owned subsidiary, Bankers Fidelity Assurance Company, are each, as of the date of

this report, rated “A-” (Excellent) by A.M.

Fidelity Life Insurance Company and its wholly-owned subsidiary, Bankers Fidelity Assurance Company, are each, as of the date of this report, rated “A-” (Excellent) by A.M.

Like all domestic insurance companies, the Company’s insurance subsidiaries are subject to regulation and supervision in the jurisdictions in which they do business.

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regulatory, supervisory, and administrative powers to state insurance commissioners.

The method of such regulation varies, but regulation relates generally to the licensing of insurers and their agents, the nature of and limitations on investments,

approval of policy forms, reserve requirements, the standards of solvency to be met and maintained, deposits of securities for the benefit of policyholders, and periodic examinations of insurers and trade practices, among other things.

Company’s products generally are subject to rate regulation by state insurance commissions, which require that certain minimum loss ratios be maintained.

Certain states also have insurance holding company laws which require registration and

periodic reporting by insurance companies controlled by other corporations licensed to transact business within their respective jurisdictions.

The Company’s insurance subsidiaries are subject to such legislation and are registered as controlled

insurers in those jurisdictions in which such registration is required.

Such laws vary from state to state, but typically require periodic disclosure concerning the corporation which controls the registered insurers and all subsidiaries of such

corporations, as well as prior notice to, or approval by, the state insurance commissioners of intercorporate transfers of assets (including payments of dividends by the insurance subsidiaries in excess of specified amounts) within the holding

company system.

The method of such regulation varies, but regulation relates generally to the licensing of insurers and their agents, the nature of and limitations on

investments, approval of policy forms, reserve requirements, the standards of solvency to be met and maintained, deposits of securities for the benefit of policyholders, and periodic examinations of insurers and trade practices, among other

The Company’s products generally are subject to rate regulation by state insurance commissions, which require that certain minimum loss ratios be maintained.

Certain states also have insurance holding company laws which require

registration and periodic reporting by insurance companies controlled by other corporations licensed to transact business within their respective jurisdictions.

The Company’s insurance subsidiaries are subject to such legislation and are

registered as controlled insurers in those jurisdictions in which such registration is required.

Such laws vary from state to state, but typically require periodic disclosure concerning the corporation which controls the registered insurers and

all subsidiaries of such corporations, as well as prior notice to, or approval by, the state insurance commissioners of intercorporate transfers of assets (including payments of dividends by the insurance subsidiaries in excess of specified

amounts) within the holding company system.

The Company believes it is in compliance with all such requirements.

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insurance subsidiaries.

Virtually all of the states in which the Company’s insurance subsidiaries are licensed to transact business require participation in their respective guaranty funds designed to cover claims against

insolvent insurers.

Virtually all of the states in which the Company’s insurance subsidiaries are licensed to transact business require participation in their respective guaranty funds designed to cover claims

against insolvent insurers.

Insurers authorized to transact business in these jurisdictions are generally subject to assessments of up to 4% of annual direct premiums written in that jurisdiction to pay such claims, if any.

The likelihood and amount of any

future assessments cannot be estimated until an insolvency has occurred.

The likelihood and

amount of any future assessments cannot be estimated until an insolvency has occurred.

The National Association of Insurance Commissioners (the “NAIC”) was established to, among other things, provide guidelines to assess the financial strength of insurance companies for state

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Each ratio has an established “usual range” of results.

A ratio result

falling outside the usual range, however, is not necessarily considered adverse;

result falling outside the usual range, however, is not necessarily considered adverse;

rather, unusual values are used as part of the regulatory early monitoring system.

Furthermore, in some years, it may not be unusual for financially sound companies to

have several ratios with results outside the usual ranges.

Generally, an insurance company may become subject to regulatory scrutiny or, depending on the company’s financial condition, regulatory action if certain of its key IRIS ratios fall

outside the usual ranges and the insurer’s financial condition is trending downward.

Furthermore, in some years, it may not be unusual for financially sound

companies to have several ratios with results outside the usual ranges.

Generally, an insurance company may become subject to regulatory scrutiny or, depending on the company’s financial condition, regulatory action if certain of its key IRIS

ratios fall outside the usual ranges and the insurer’s financial condition is trending downward.

For the year ended December 31, 2023, Bankers Fidelity Assurance Company had three ratios outside the usual range, primarily as a result of net loss for the year, certain surplus ratios and

Non-admitted Assets to Admitted Assets.

The net loss at Bankers Fidelity Assurance Company is primarily related to federal income taxes incurred which resulted in a corresponding decrease in surplus levels for the year as well as a growing Deferred

Tax Asset which is a Non-admitted.

Atlantic Capital Life Assurance Company had one ratio outside the usual range primarily due to the fact that the Change in Asset Mix was automatically considered unusual because the prior year value was zero, as

the company was not in existence during the prior year.

The net loss at Bankers Fidelity Assurance Company is primarily related to federal income taxes incurred which resulted in a corresponding decrease in surplus levels for the year as well as a growing

Deferred Tax Asset which is a Non-admitted.

Atlantic Capital Life Assurance Company had one ratio outside the normal range, Change in Asset Mix.

The Change in Asset Mix was the result of Atlantic Capital Life Assurance Company investing its

cash and cash equivalents from prior year into bonds.

Bankers Fidelity Life Insurance Company, American Southern Insurance Company and American Safety Insurance Company had no IRIS ratios outside the usual ranges.

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At December 31, 2023, the Company’s insurance subsidiaries’ RBC levels exceeded the required regulatory levels.

Information Technology and Cybersecurity

The Company’s operations rely on the secure processing, storage, and transmission of confidential and personal identifiable information within various technology platforms.

Cybersecurity is a high

priority and the Company has made significant investments in order to prevent, detect, and respond to cyber threats.

The Company continues to enhance its intrusion protection and detection technology, infrastructure and application firewalls, and

network monitoring.

The Company has also installed advanced endpoint threat protection technology and implemented a mandatory security awareness training program for all employees.

This training is reinforced through periodic simulated phishing

The Company uses a sophisticated backup and recovery methodology that supports the replication of data across multiple secure data centers.

It also includes a comprehensive disaster recovery plan

that is continually tested to help enable us to resume business in the event of a disaster.

The Company’s technology environment is managed by an experienced team of professionals who follow an extensive set of policies and procedures related to

data security.

Through recurring internal and external audits, controls are regularly reviewed, tested, and enhanced to promote best practices.

The Company has augmented the information security program through a partnership with a leading global

cybersecurity service provider to review and implement additional services such as Security Event Monitoring, Advanced Endpoint Threat Detection, Incident Management Retainer Services, and Strategic Advisory Services focused on Chief Information

Security Officer (CISO) duties such as counter-threat intelligence.

The information security program also includes a cybersecurity Incident Response Plan (“IRP”) that was established to help protect the integrity, availability and confidentiality of information,

prevent loss of service, and comply with legal requirements.

The IRP specifies the process for identifying and reporting an incident, initial investigation, risk classification, documentation and communication of incidents, responder procedures,

incident reporting, and ongoing training.

Additionally, the IRP specifies the notification to directors, officers, and other corporate insiders to not trade the Company’s securities while in possession of potentially material nonpublic information

about the incident.

The Audit Committee of the Board of Directors has oversight of the Company’s information security program.

The Company’s senior officers, including its Chief Information Officer, are responsible

for the operation of the information security program and regularly communicate with the Audit Committee on the state of the program.

The Company also maintains dedicated cyber liability insurance for breach event costs, including:

post breach event remediation costs;

cyber crime coverage (including financial fraud,

telecommunications fraud, and phishing attacks);

and coverage for system failure, bricking loss, and physical damage.

The policy also provides coverage for lost revenue due to a damaged reputation from a cyber breach.

Investment income represents a significant portion of the Company’s operating and total income.

21 unchanged sentences

Equity securities are carried on the balance sheet at estimated fair value.

Total cost of equity securities was $4.9 million as of December 31, 2022 and $4.9 million as of December 31, 2021.

Total cost of equity securities was $4.9 million as of December 31, 2023 and 2022.

Other invested assets are accounted for using the equity method.

42 unchanged sentences

The SEC maintains a website at www.sec.gov that contains reports, proxy and information statements and other information regarding issuers that file electronically with the SEC, including the Company.

In addition, as soon as

reasonably practicable after such materials are filed with or furnished to the SEC by the Company, the Company makes copies available to the public, free of charge, on or through its web site at www.atlam.com.

Neither the Company’s website, nor the

information appearing on the website, is included, incorporated into, or a part of, this report.

In addition, as soon

as reasonably practicable after such materials are filed with or furnished to the SEC by the Company, the Company makes copies available to the public, free of charge, on or through its web site at www.atlam.com.

Neither the Company’s website,

nor the information appearing on the website, is included, incorporated into, or a part of, this report.

Executive Officers of the Registrant

The table and information below set forth, for each current executive officer of the Company, his name, age (as of June 1, 2023), positions with the Company and business experience for the past

The table and information below set forth, for each current executive officer of the Company, his name, age (as of March 1, 2024), positions with the Company and business experience for the past

five years, as well as any prior service to the Company.

5 unchanged sentences

Officers are elected annually and serve at the discretion of the board of directors.

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.

He has been a Director of the Company since October 1992 and effective February 24, 2009, began serving as Chairman of the board of directors.

He is also Executive Chairman and Chief Executive Officer of Gray

Television, Inc.

Franklin has been Vice President, Chief Financial Officer and Corporate 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.

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.

He has been a Director of the Company since October 1992 and effective February 24,

2009, began serving as Chairman of the board of directors.

He is also Executive Chairman and Chief Executive Officer of Gray Television, Inc.

Franklin has been Vice

President, Chief Financial Officer and Corporate 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.

As a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and in Item 10(f)(1) of Regulation S-K (a “smaller reporting company”), we have elected to comply with certain scaled

disclosure reporting obligations, and therefore are not providing the information required by this Item.

Unresolved Staff Comments

Not applicable.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business