A.M. Best Affirms Ratings of American Southern Group, Association Casualty Insurance Company and Georgia Casualty & Surety Company.

OLDWICK, N.J. -- A.M. Best Co. has affirmed the financial strength rating (FSR) of A- (Excellent) and the issuer credit rating (ICR) of "a-"of Association Casualty Insurance Company (ACIC) (Austin, TX) and the FSR of B++ (Very Good) and the ICR of "bbb" of Georgia Casualty & Surety Company (GCSC). The outlook for these ratings is negative. In addition, A.M. Best has affirmed the FSR of A- (Excellent) and the ICR "a-" of American Southern Group (American Southern), which consists of American Southern Insurance Company and its wholly owned subsidiary, American Safety Insurance Company. The outlook for these ratings is stable. A.M. Best has also affirmed the ICR of "bbb-" of Atlantic American Corporation (AAME) [NASDAQ: AAME]. The rating outlook is negative. All companies are members of AAME and are domiciled in Atlanta, GA, except where specified.

ACIC's ratings reflect its adequate capitalization, modestly improved underwriting and operating performance and initiatives taken in recent years to diversify geographically throughout the south along with product mix. These positive factors are offset by sub par underwriting and operating results during the 1999-2003 period, inclusive, driven by intense competitive market conditions as well as deficient workers' compensation loss reserves.

GCSC's ratings also reflect its adequate capitalization and the anticipated benefits to be derived from management's underwriting initiatives that were taken in recent years. The ratings also recognize the explicit support of AAME. Offsetting these positive rating factors are the continued poor underwriting results, as well as ongoing adverse loss reserve development recorded in recent years.

The rating affirmations of American Southern are based on its excellent capitalization, solid operating performance and conservative management philosophy. However, the group's ability to retain earnings has been hampered by considerable stockholder dividends, which historically have been used to service the debt held at its publicly-traded parent company, AAME.

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