Schedule II CONDENSED FINANCIAL INFORMATION OF REGISTRANT

12 Months Ended

Dec. 31, 2021

Schedule II CONDENSED FINANCIAL INFORMATION OF REGISTRANT [Abstract]

Schedule II CONDENSED FINANCIAL INFORMATION OF REGISTRANT

Schedule II

Page 1 of 3

CONDENSED FINANCIAL INFORMATION OF REGISTRANT

ATLANTIC AMERICAN CORPORATION

(Parent Company Only)

BALANCE SHEETS

ASSETS

	December 31,
	2021		2020
	(In thousands)
Cash and cash equivalents	$	1,718	$	2,090
Investments		2,749		2,598
Investment in subsidiaries		164,535		172,996
Investments in unconsolidated trusts		1,238		1,238
Deferred tax asset, net		1,237		—
Income taxes receivable from subsidiaries		2,171		1,683
Other assets		5,791		4,311
Total assets	$	179,439	$	184,916
LIABILITIES AND SHAREHOLDERS’ EQUITY
Deferred tax liability, net	$	—	$	1,765
Other payables		4,415		4,353
Junior subordinated debentures		33,738		33,738
Total liabilities		38,153		39,856
Shareholders’ equity		141,286		145,060
Total liabilities and shareholders’ equity	$	179,439	$	184,916

See accompanying report of independent registered public accounting firm.

Schedule II

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CONDENSED FINANCIAL INFORMATION OF REGISTRANT

ATLANTIC AMERICAN CORPORATION

(Parent Company Only)

STATEMENTS OF OPERATIONS

	Year Ended December 31,
	2021			2020
	(In thousands)
REVENUE
Fee income from subsidiaries	$	7,380		$	6,745
Distributed earnings from subsidiaries		8,400			3,900
Unrealized gains (losses) on equity securities, net		230			(191	)
Other		(247	)		(784	)
Total revenue		15,763			9,670
GENERAL AND ADMINISTRATIVE EXPENSES		13,654			11,521
INTEREST EXPENSE		1,387			1,610
		722			(3,461	)
INCOME TAX BENEFIT(1)		(2,840	)		(3,623	)
		3,562			162
EQUITY IN UNDISTRIBUTED EARNINGS OF SUBSIDIARIES, NET		719			12,007
NET INCOME	$	4,281		$	12,169

(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.

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,
	2021			2020
	(In thousands)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income	$	4,281		$	12,169
Adjustments to reconcile net income to net cash provided by operating activities:
Unrealized (gains) losses on equity securities, net		(230	)		191
Depreciation and amortization		538			594
Compensation expense related to share awards		211			437
Equity in undistributed earnings of subsidiaries, net		(719	)		(12,007	)
(Increase) decrease in intercompany taxes		(489	)		622
Deferred income tax benefit		(1,058	)		(2,446	)
Increase in accounts payable and accrued expenses		63			121
Other, net		(1,966	)		917
Net cash provided by operating activities		631			598
CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to property and equipment		(49	)		(95	)
Net cash used in investing activities		(49	)		(95	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Payment of dividends on Series D preferred stock		(399	)		(399	)
Payment of dividends on common stock		(408	)		—
Proceeds from shares issued under stock plans		6			9
Treasury stock acquired — net employee share-based compensation		(153	)		(91	)
Net cash used in financing activities		(954	)		(481	)
Net (decrease) increase in cash		(372	)		22
Cash and cash equivalents at beginning of year		2,090			2,068
Cash and cash equivalents at end of year	$	1,718		$	2,090
Supplemental disclosure:
Cash paid for interest	$	1,389		$	1,665
Cash paid for income taxes	$	3,202		$	3,883
Intercompany tax settlement from subsidiaries	$	6,734		$	1,798