AssuranceAmerica Corporation Reports Results for the Three and Six Months Ended June 30, 2010

Atlanta-based ASSURANCEAMERICA CORPORATION (OTC BB: ASAM) today announced its unaudited financial results for the three and six months ended June30, 2010.

Gross premiums written decreased 10% during the second quarter of 2010 compared to the same period in 2009, and decreased 6% in six months period in 2010 compared to the same period in 2009.

Revenues were $15.6 million and $33.8 million for the three and six months ended June 30, 2010, compared to revenues of $16.4 million and $34.2 million for the three and six months ended June 30, 2009.

The Company reported a net loss of $161 thousand for the second quarter, compared to net income of $182 thousand for the same period in 2009. The Company’s net income was $0.7 million for the six month period ended June 30, 2010, compared to $1.0 million in 2009.

Guy W. Millner, Chairman and CEO, stated, “The soft market of 2009 continues into 2010. Price increases are challenged by an economy in which many of our policyholders are unemployed. Our strategy is to continue to grow in states where pricing allows us a favorable margin and reduce writings where it doesn’t. Our Company continues to make the necessary investments so that we will be in a position to benefit once the market improves.”

AssuranceAmerica focuses on the non-standard automobile insurance marketplace, primarily in Alabama, Arizona, Florida, Georgia, Indiana, Louisiana, Mississippi, South Carolina, Texas and Virginia. Its principal operating subsidiaries are TrustWay Insurance Agencies, LLC (“Agency”), which sells personal automobile insurance policies through its 45 retail agencies, AssuranceAmerica Managing General Agency, LLC (“MGA”), and AssuranceAmerica Insurance Company (“Carrier”).

Forward-Looking Statements

This press release, contains certain statements that may be deemed to be “forward-looking statements”. These statements are made subject to the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. All statements in this press release not dealing with historical results or current facts are forward-looking and are based on estimates, assumptions, and projections. Statements that include the words “assumes”, “believes,” “seeks,” “expects,” “may,” “should,” “intends,” “likely,” “targets,” “plans,” “anticipates,” “estimates” or the negative version of those words and similar statements of a future or forward-looking nature identify forward-looking statements.

The primary events or circumstances that could cause actual results to differ materially from those expected by AssuranceAmerica Corporation include determinations with respect to reserve adequacy, realized gains or losses on the investment portfolio including other-than-temporary impairments for credit losses, rising loss cost trends, actions of competitors and natural disasters. AssuranceCorpoation undertakes no obligation to publicly update or revise any of the forward-looking statements. For a more detailed discussion of some of the foregoing risks and uncertainties which could cause actual results to differ from those contained in the forward-looking statements, see AssuranceAmerican Corporation filings with the Securities and Exchange Commission.

ASSURANCEAMERICA CORPORATION (Unaudited) CONSOLIDATED STATEMENTS OF OPERATIONS Three Months ended June 30, Six Months ended June 30, 2010 2009 2010 2009 Revenue Gross premiums written $ 21,658,673 $ 24,052,857 $ 54,038,386 $ 57,652,826 Gross premiums ceded (14,594,748) (16,150,666) (36,620,776) (38,919,363) Net premiums written 7,063,925 7,902,191 17,417,610 18,733,463 (Increase) decrease in unearned premiums, net of prepaid reinsurance premiums 1,375,719 822,146 (545,987) (1,721,615) Net premiums earned 8,439,644 8,724,337 16,871,623 17,011,848 Commission income 4,251,201 5,077,508 10,730,777 11,758,480 Managing general agent fees 2,655,449 2,415,638 5,638,661 5,208,671 Net investment income 204,516 198,537 336,489 343,123 Net investment losses on securities (16,246) (85,814) (5,702) (325,701) Other fee income 90,456 75,235 228,911 182,617 Total revenue 15,625,020 16,405,441 33,800,759 34,179,038 Expenses Losses and loss adjustment expenses 5,878,285 6,312,214 11,835,743 12,072,205 Selling general and administrative expenses 9,409,447 9,254,720 19,763,664 19,408,405 Stock option expense 123,874 88,281 213,369 167,176 Depreciation and amortization expense 286,475 293,750 564,881 593,994 Interest expense 90,183 118,333 187,665 252,690 Total operating expenses 15,788,264 16,067,298 32,565,322 32,494,470 Income (loss) before taxes (163,244) 338,143 1,235,437 1,684,568 Income tax provision (benefit) (2,256) 156,411 557,821 685,858 Net income (loss) $ (160,988) $ 181,732 $ 677,616 $ 998,710 Earnings (loss) per common share Basic $ (0.002) $ 0.003 $ 0.010 $ 0.015 Diluted $ (0.002) $ 0.003 $ 0.010 $ 0.015 Weighted average shares outstanding-basic 65,494,357 65,144,357 65,440,213 65,096,300 Weighted average shares outstanding-diluted 65,494,357 65,421,284 65,920,449 65,174,857 ——————————————————————————-