ATLANTIC AMERICAN CORP

Evaluation of Disclosure Controls and Procedures

The Company maintains disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that are designed to ensure that information required to be disclosed in reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms and is accumulated and communicated to management, including the Company’s principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.

As of December 31, 2025, management, with the participation of the Company’s Chief Executive Officer and its Principal Financial Officer, evaluated the effectiveness of the Company’s disclosure controls and procedures. Based on this evaluation, management, including the Chief Executive Officer and Principal Financial Officer concluded that the Company’s disclosure controls and procedures were not effective as of December 31, 2025 because of the material weaknesses in internal control over financial reporting described below.

Management’s Report on Internal Control Over Financial Reporting

Management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. The Company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP. 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 in future periods is 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.

Management assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, 2025, using the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in the Internal Control – Integrated Framework (2013). Based on this assessment, management concluded that the Company’s internal control over financial reporting was not effective as of December 31, 2025, because of the material weaknesses 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 the Company’s annual or interim financial statements will not be prevented or detected on a timely basis.

Material Weakness—Group Premium Receivables and Suspense Cash Application

Management identified deficiencies in the design and operating effectiveness of controls over the recording and reconciliation of premium receivables and the application of premium payments held in suspense within the Company’s group whole life and group accident and health business.

The Company did not design and maintain effective controls to timely and accurately reconcile enrollment, billing and cash receipt information at the individual policyholder level and to resolve differences among third-party enrollment data, the policy administration system and the general ledger.

As a result, the Company did not maintain controls operating at a sufficient level of precision to determine whether recorded premium receivables were valid, whether amounts held in suspense should be applied to individual policyholders or otherwise recognized, and whether the related amounts were recorded in the appropriate period and were appropriately classified in the Consolidated Financial Statements.

These deficiencies created a reasonable possibility that a material misstatement of premium revenue, premium receivables, accounts payable and accrued expenses and related disclosures would not be prevented or detected on a timely basis.

Material Weakness— Implementation of LDTI and Valuation and Accounting for Long-duration contracts

Management identified deficiencies in the design and operating effectiveness of internal controls over the adoption and implementation of Accounting Standards Update No. 2018-12, Financial Services—Insurance (Topic 944): Targeted Improvements to the Accounting for Long-Duration Contracts (“LDTI”).

The Company lacked sufficient personnel with the specialized technical accounting, actuarial and internal control knowledge and experience necessary to design and execute an effective implementation process for LDTI and to perform an appropriate level of review over the resulting actuarial calculations, accounting entries and financial statement disclosures.

Consequently, the Company did not design and maintain effective controls to ensure that significant LDTI data inputs, assumptions, model configurations and accounting conclusions were identified, validated and incorporated completely and accurately into the actuarial calculations, accounting records and financial statement disclosures in time to complete the year-end financial reporting process.

These deficiencies created a reasonable possibility that a material misstatement of LFPB, related remeasurement gains or losses, DAC, AOCI, income taxes and related financial statement disclosures would not be prevented or detected on a timely basis.

Material Weakness— Income Tax Accounting

Management identified deficiencies in the design and operating effectiveness of internal controls over the preparation, review and financial reporting of the Company’s income tax provision and current and deferred tax balances.

The Company’s controls did not operate with sufficient precision and timeliness to ensure that the tax-basis reserves, premium and LDTI transition information used in the tax provision were complete and accurate.

Consequently, the income tax provision calculations were subject to revisions and required subsequent correction or reclassification. Although management’s corrective procedures supported the final reported amounts, those subsequent procedures demonstrated that the underlying controls were not operating effectively as of December 31, 2025.

These deficiencies created a reasonable possibility that a material misstatement of income tax related balances and related financial statement disclosures would not be prevented or detected on a timely basis.

Remediation Activities

As further described below, management has initiated remediation activities intended to address the material weaknesses described above, which remain unremediated as of the date of this report. These activities include the following:

Material Weakness—Group Premium Receivables and Suspense Cash Application

Material Weakness—Implementation of LDTI and Valuation and Accounting for Long-duration contracts

Material Weakness—Income Tax Accounting

Changes in Internal Control Over Financial Reporting

We adopted new accounting guidance for insurance and reinsurance companies that issue long-duration contracts (“LDTI”) as of January 1, 2025 on a modified retrospective transition basis. As a result, we implemented changes to our relevant business processes and internal controls over financial reporting.

Except as reported above, no changes in our internal control over financial reporting (as such term is defined in Rule 13a-15(f) of the Exchange Act) occurred during the quarter ended December 31, 2025 that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

After December 31, 2025, the Company began implementing certain remediation measures with respect to the material weaknesses described above. Those post-year-end remediation activities did not affect management’s assessment of the effectiveness of internal control over financial reporting as of December 31, 2025.

Attestation Report of the Registered Public Accounting Firm

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.