Atlantic American(AAME) - 2024 Q1 - Quarterly Report

Financial Performance - For the three-month period ended March 31, 2024, net loss was $1.998 million, or$(0.10) per diluted share, compared to a net loss of $1.446 million, or$(0.08) per diluted share, for the same period in 2023[95]. - Total revenue for the three-month period ended March 31, 2024, was $46.997 million, an increase of 1.6$46.269 million in the same period of 2023[93]. - Operating income decreased by $2.9 million for the three-month period ended March 31, 2024, primarily due to unfavorable loss experience in life and health operations[96]. - The Parent's insurance subsidiaries reported a statutory net loss of$1.6 million for the three months ended March 31, 2024, compared to a net income of $1.1 million in the same period in 2023[117]. Insurance Premiums - Insurance premiums, net, decreased by$1.548 million, or 3.4%, to $44.552 million for the three-month period ended March 31, 2024, from$46.100 million in the same period of 2023[96]. - American Southern's gross written premiums decreased by $1.0 million, or 10.2$8.470 million for the three-month period ended March 31, 2024, compared to $9.430 million in the same period of 2023[98]. - Bankers Fidelity's net earned premiums decreased to$26.674 million for the three-month period ended March 31, 2024, from $28.889 million in the same period of 2023[106]. - Net earned premium revenue decreased by$2.2 million, or 7.7%, to $26.4 million for the three months ended March 31, 2024, compared to the same period in 2023[109]. Loss Ratios and Expenses - The loss ratio for American Southern improved to 71.7$1.3 million, or 7.4%, resulting in a loss ratio of 71.7% for the three months ended March 31, 2024, compared to 61.6% in the same period in 2023[110]. - Commissions and underwriting expenses for American Southern increased by $0.3 million, or 8.3$0.4 million, or 3.5%, but the expense ratio increased to 38.8% from 37.1% year-over-year[111]. - The combined ratio for American Southern was 97.1% for the three-month period ended March 31, 2024, compared to 97.9% in the same period of 2023[98]. - Bankers Fidelity's combined ratio was 110.5% for the three-month period ended March 31, 2024, compared to 98.7% in the same period of 2023[107]. Cash and Investments - At March 31, 2024, the Parent had approximately $5.9 million of unrestricted cash and investments[116]. - Cash and cash equivalents decreased from$28.3 million at December 31, 2023, to $21.2 million at March 31, 2024, primarily due to net cash used in operating activities of$5.3 million[128]. - The Company had outstanding borrowings of $4.0 million under the Revolving Credit Agreement as of March 31, 2024, an increase from$3.0 million at December 31, 2023[127]. Investment Income - Investment income increased slightly due to higher returns from fixed maturities and equity securities, despite a $0.1 million decrease in earnings from limited partnerships[112]. - The Company recognized net unrealized losses on equity securities of$0.1 million for the three months ended March 31, 2024, compared to $2.4 million in the same period in 2023[113]. - Interest expense increased by$0.1 million, or 14.0%, primarily due to changes in the Secured Overnight Financing Rate (SOFR)[114].