SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 11-K
(Mark One) X ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2002 OR TRANSACTION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 (NO FEE REQUIRED) Commission file number 0-3722 ------ A. Full title of the plan and the address of the plan, if different from that of the issuer named below: Atlantic American Corporation 401(k) Retirement Savings Plan B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office: Atlantic American Corporation 4370 Peachtree Road, N.E. Atlanta, GA 30319

TABLE OF CONTENTS ----------------- SIGNATURES - ---------- Financial Statements and Schedules - ---------------------------------- Consent of Gifford, Hillegass & Ingwersen, P.C. - -----------------------------------------------

SIGNATURES THE PLAN. Pursuant to the requirements of the Securities Exchange Act of 1934, the trustees (or other persons who administer the employee benefit plan) have duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized. Atlantic American Corporation 401(k) Retirement Savings Plan ----------------------------------------------------- ----------------------------------------------------- (Name of Plan) - -------------------

/s/ John G. Sample, Jr. ------------------------------------------------------ ------------------------------------------------------ John G. Sample, Jr. Senior Vice President and CFO

Table of Contents - ----------------- ATLANTIC AMERICAN CORPORATION 401(K) RETIREMENT SAVINGS PLAN The following exhibits are filed herewith: Exhibit 1: Financial Statements and Schedules as of December 31, 2002 and 2001 together with auditor's report. Exhibit 2: Consent of Gifford , Hillegas & Ingwersen, P.C.









                          ATLANTIC AMERICAN CORPORATION
                         401(k) RETIREMENT SAVINGS PLAN

                 Financial Statements and Supplemental Schedule

                 For the Years Ended December 31, 2002 and 2001

                                      with
                         Report of Independent Auditors








ATLANTIC AMERICAN CORPORATION 401(k) RETIREMENT PLAN TABLE OF CONTENTS December 31, 2002 and 2001 - -------------------------------------------------------------------------------- Independent Auditors' Report...................................................1 Statements of Net Assets Available for Benefits................................2 Statement of Changes in Net Assets Available for Benefits......................3 Notes to Financial Statements..................................................4 Supplemental Schedule: Schedule H, Line 4i: Schedule of Assets Held for Investment Purposes....12

INDEPENDENT AUDITORS' REPORT To the Plan Administrator and Plan Participants of Atlantic American Corporation 401(k) Retirement Savings Plan: We have audited the accompanying statements of net assets available for benefits of the Atlantic American Corporation 401(k) Retirement Savings Plan as of December 31, 2002 and 2001, and the related statement of changes in net assets available for benefits for the year ended December 31, 2002. These financial statements are the responsibility of the Plan's management. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the net assets available for benefits of the Atlantic American Corporation 401(k) Retirement Savings Plan as of December 31, 2002 and 2001, and the changes in net assets available for benefits for the year ended December 31, 2002, in conformity with accounting principles generally accepted in the United States. Our audit of the Plan's financial statements as of and for the year ended December 31, 2002 was performed for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedule listed in the index is presented for the purpose of additional analysis and is not a required part of the basic financial statements but is supplementary information required by the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. The supplemental schedule is the responsibility of the Plan's management. The supplemental information has been subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, is fairly stated in all material respects in relation to the basic financial statements taken as a whole. GIFFORD, HILLEGASS & INGWERSEN, P.C. June 9, 2003 Atlanta, Georgia 1

ATLANTIC AMERICAN CORPORATION 401(k) RETIREMENT SAVINGS PLAN STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS For the Years Ended December 31, 2002 and 2001 - -------------------------------------------------------------------------------- 2002 2001 ------------------ ------------------ Investments, at fair value $ 5,789,100 $ 4,325,844 Cash 18,424 34,876 Employer Contributions Receivable 108,093 - ------------------ ------------------ NET ASSETS AVAILABLE FOR PLAN BENEFITS $ 5,915,617 $ 4,360,720 ================== ================== The accompanying notes are an integral part of these financial statements. 2

ATLANTIC AMERICAN CORPORATION 401(k) RETIREMENT SAVINGS PLAN STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS For the Year Ended December 31, 2002 - -------------------------------------------------------------------------------- Additions to Net Assets Investment income: Interest and dividend income $ 52,940 ----------------- TOTAL INVESTMENT INCOME 52,940 Contributions: Participants 630,279 Company 346,731 Rollover 629,329 ----------------- TOTAL CONTRIBUTIONS 1,606,339 ----------------- TOTAL ADDITIONS TO NET ASSETS 1,659,279 Deductions from Net Assets Benefit payments to participants (475,707) Net depreciation in fair market value of investments (1,253,631) ----------------- TOTAL DEDUCTIONS (1,729,338) ----------------- NET DECREASE BEFORE TRANSFERS IN (70,059) Transfers In (Note A) 1,624,956 ----------------- NET INCREASE 1,554,897 Net Assets Available for Benefits at Beginning of Year 4,360,720 ----------------- Net Assets Available for Benefits at End of Year $ 5,915,617 ================= The accompanying notes are an integral part of these financial statements. 3

ATLANTIC AMERICAN CORPORATION 401(k) RETIREMENT SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS December 31, 2002 - -------------------------------------------------------------------------------- NOTE 1--DESCRIPTION OF THE PLAN The following description of the Atlantic American Corporation 401(k) Retirement Savings Plan (the "Plan") provides only general information. Participating members ("Participants") should refer to the Plan document for a more complete description of the Plan's provisions. Information with regard to eligibility, contributions, distributions, vesting, withdrawals, restoration, loans, fund redistribution, and definitions of all terms are contained in that document. General: The Plan is a defined contribution plan available to all U.S. employees of Atlantic American Corporation (the "Company"). All employees of the Company, except collective bargaining employees, nonresident aliens, and leased employees are eligible to participate on the first day of the upcoming quarter in which the individual became an employee of the Company. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974 ("ERISA"), as amended. Plan Administration: AMVESCAP National Trust Company (the "Trustee") is the Trustee of the Plan and has custodial responsibility for the Plan's assets, except for company stock that is held by State Street Bank and Trust Company, including the authority and power to, among other things, invest the principal and income of the Plan's assets. Contributions: Participants may elect to contribute in 1% increments up to 25% of their annual compensation, as defined by the Plan, subject to certain limitations under the Internal Revenue Code (the "Code"), into any of the investment funds offered by the Plan. A participant may change his or her deferral percentage at any time, however, the changes take effect once a month. Participants may also contribute amounts representing distributions from other qualified benefit plans. These contributions are classified as rollover contributions in the statement of changes in net assets available for plan benefits for the year ended December 31, 2002. The Company provides a matching contribution equal to a certain percentage of the participant's contributions. For the year ended December 31, 2002, the Company's matching contribution equaled 50% of the first 6% of each participant's contribution. All Company matching contributions are in Company common stock. A participant can elect to transfer the Company contributions into another investment fund only after the participant is fully vested in the Company matching contributions. The Company may also elect to make additional matching contributions. Vesting: Participants are always fully vested in their own contributions. Each participant becomes vested in the company contributions based on years of continuous service. The vesting percentage for company contributions are as follows: 4

ATLANTIC AMERICAN CORPORATION 401(k) RETIREMENT SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS December 31, 2002 - -------------------------------------------------------------------------------- NOTE 1--DESCRIPTION OF THE PLAN--Continued Years of service: Less than one 0% One 20% Two 40% Three 60% Four 80% Five 100% In addition, participants become fully vested upon retirement, death, or disability. Benefits: Upon termination of service due to death, disability, retirement, or separation from service, a participant or his or her beneficiary may elect to receive an amount equal to the value of the participant's vested interest in his or her account. The form of payment, selected by the participant or his or her beneficiary, is either a lump-sum distribution, an annuity to be paid in monthly installments over a fixed number of years, or a direct rollover into a qualified retirement plan or individual retirement account. Participant Accounts: Individual accounts are maintained for each of the Plan's participants and reflect the participant's contributions, employer contributions, and the participant's share of the Plan's investment income (loss). Allocations of income (loss) are based on the proportion that each participant's account balance bears to the total of all participant account balances and their investment elections. Investment Options: Participants may direct their contributions and any related earnings into several investment options in 1% increments. Participants may change their investment elections at any time. The participants in the Plan can invest in any of the following investment options: Atlantic American Corporation Common Stock - Funds are invested in common stock of the Company. INVESCO Cash Reserves Fund - Mutual fund that is a blend of commercial paper and government agency obligations. Effective January 1, 2003, the Cash Reserves Fund was replaced by the INVESCO Stable Value Fund. 5

ATLANTIC AMERICAN CORPORATION 401(k) RETIREMENT SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS December 31, 2002 - -------------------------------------------------------------------------------- NOTE 1--DESCRIPTION OF THE PLAN--Continued INVESCO Core Equity Fund - Mutual fund that invests in dividend-paying common and preferred stocks of large U.S. companies and in convertible bonds, debt issues, and preferred stocks. INVESCO Core Fixed Income Fund - Mutual fund that seeks current income, with a secondary objective of capital appreciation. INVESCO Select Income Fund - Mutual fund that invests primarily in bonds and marketable debt securities of established companies. Fidelity Puritan - Mutual fund that seeks income consistent with preservation of capital and invests in a securities such as common stocks, preferred stocks, and bonds. INVESCO Balanced Fund - Mutual fund that invests in common stocks and in fixed income securities, including preferred stocks, convertible securities, and bonds. INVESCO Dynamics Fund - Mutual fund that invests in common stocks of mid-sized companies in addition to preferred stocks, convertible securities, and bonds. INVESCO Small Company Growth Fund - Mutual fund which invests in small-capitalization companies in the developing stage. IRT 500 Index Fund - Funds are invested in a collective trust that seeks to provide total returns that closely replicate those of the Standard and Poor's 500 composite index. AIM Basic Value Fund - Mutual fund that invests in under-valued securities, investment-grade nonconvertible debt securities, U.S. government securities, high-quality money market instruments, and foreign securities. Janus Twenty Fund - Mutual fund that invests primarily in common stocks selected for long-term growth potential. Janus Advisor Worldwide Fund - Mutual fund that invests primarily in common stocks of companies of any size located throughout the world. 6

ATLANTIC AMERICAN CORPORATION 401(k) RETIREMENT SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS December 31, 2002 - -------------------------------------------------------------------------------- NOTE 1--DESCRIPTION OF THE PLAN--Continued INVESCO Structured Small Cap Fund - Mutual fund with goal of long-term capital appreciation. AIM Capital Development - Mutual funds that seek long-term capital appreciation by investing primarily in securities of small and medium sized companies. American Century Ultra - Mutual fund that may only purchase securities of companies that have operated continuously for three or more years. Berger Mid Cap Value - Mutual fund that invests in companies with smaller or larger market capitalization, government securities or other short-term investments. Investment securities, in general, are exposed to various risks, including interest rate, credit, and overall market volatility risks. Due to the level of risk associated with certain investment securities, it is reasonably possible that changes in the values of investment securities will occur in the near term and that such changes could materially affect the amounts reported in the statements of net assets available for plan benefits. Forfeitures: Amounts forfeited from nonvested accounts are used to reduce future employer contributions. Participant Loans: Participants may borrow from their fund accounts a minimum of $1,000 up to a maximum equal to the lesser of $50,000 or 50% of their vested account balance. Participants may elect to have their loans disbursed from specific investment funds. Loan terms range from six months to five years or within a reasonable time if used for the purchase of a primary residence. The loans are secured by the vested value of the participants' account balance and bear interest at the prime rate of interest on the date of the loan plus 1%. Principal and interest are paid ratably through payroll deductions of not less than $10 per pay period or in a single lump sum. Administrative Expenses: The Company pays all administrative expenses of the Plan, including trustee fees. 7

ATLANTIC AMERICAN CORPORATION 401(k) RETIREMENT SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS December 31, 2002 - -------------------------------------------------------------------------------- NOTE 1-DESCRIPTION OF THE PLAN-Continued Transfers In: Effective April 1, 2002, the Association Insurance Agency Employees' Savings Plan, which was established by a subsidiary of the Company, was merged into the Atlantic American Corporation 401(k) Retirement Savings Plan. The transfer was recorded at the fair market value of the assets transferred. NOTE 2-ACCOUNTING POLICIES Basis of Accounting: The accompanying financial statements have been prepared using the accrual basis of accounting. Use of Estimates: The preparation of the financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported additions and deductions during the reporting period. Actual results could differ from those estimates. Valuation of Investments: All investments are stated at fair value. Securities traded on national securities exchanges are valued at the closing price on a daily basis. Investments traded in over-the-counter markets and listed securities for which no sale was reported on that date are valued at the last reported bid price. Purchases and sales of securities and mutual funds are reflected on a trade-date basis. Net Appreciation (Depreciation): Net realized gains (losses) and unrealized appreciation (depreciation) are recorded in the accompanying statement of changes in net assets available for plan benefits as net depreciation in fair value of investments. 8

ATLANTIC AMERICAN CORPORATION 401(k) RETIREMENT SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS December 31, 2002 - -------------------------------------------------------------------------------- NOTE 3--INVESTMENTS The fair market values of individual investments that represent 5% or more of the Plan's net assets as of December 31, 2002 are as follows: 2002 ----------- Atlantic American Corporation common stock $ 615,000 INVESCO Cash Reserves Fund 1,153,583 INVESCO Core Equity Fund 736,464 INVESCO Select Income Fund 339,934 INVESCO Balanced Fund 535,176 INVESCO Dynamics Fund 910,597 IRT 500 Index Fund 299,244 Janus Twenty Fund 330,914 Fidelity Puritan 370,757 Net depreciation in fair value of investments by major investment type for the year ended December 31, 2002 is as follows: Common stock - Atlantic American Corporation $ (205,840) Mutual funds (1,047,791) ----------- $(1,253,631) 9

ATLANTIC AMERICAN CORPORATION 401(k) RETIREMENT SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS December 31, 2002 - -------------------------------------------------------------------------------- NOTE 4--NONPARTICIPANT-DIRECTED INVESTMENTS Information about the net assets as of December 31, 2002 and the significant components of the change in net assets for the year then ended relating to the Company's common stock (nonparticipant-directed investments) is as follows: 2002 ----------- Net Assets: Common Stock - Atlantic American Corporation $ 181,575 =========== Changes in Net Assets: Contributions - employer $ 92,539 Net depreciation in fair value of common stock (58,603) Benefits paid to participants and participant forfeitures (10,586) Transfers to participant-directed investments (6,137) ----------- $ 17,213 =========== NOTE 5-TAX STATUS The Internal Revenue Service has determined and informed the Sponsor by letter dated June 3, 2003, that the Plan and related trust are designed in accordance with applicable sections of the Internal Revenue Code ("IRC"). NOTE 6-PLAN TERMINATION Although it has not expressed any intent to do so, the Company has the right under the Plan to discontinue its contributions at any time and to terminate the Plan subject to the provisions of ERISA. In the event of plan termination, participants will become fully vested in their accounts as of the termination date. 10

ATLANTIC AMERICAN CORPORATION 401(k) RETIREMENT SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS December 31, 2002 - -------------------------------------------------------------------------------- NOTE 7-RECONCILIATION OF FINANCIAL STATEMENTS TO FORM 5500 The following is a reconciliation of net assets available for plan benefits per the financial statements to the Form 5500 as follows for the year 2002:

Net assets available for plan benefits per the financial statements $ 5,915,617 Less employer contribution receivable (108,093) ------------------ Net assets available for plan benefits per the Form 5500 $ 5,807,524 ================== Employer contributions per the financial statements $ 346,731 Less employer contribution receivable (108,093) ------------------ Employer contributions per the Form 5500 $ 238,638 ==================
11

SUPPLEMENTAL INFORMATION

Atlantic American Corporation 401(k) Retirement Savings Plan Schedule H, Line 4i--Schedule of Assets (Held at end of year) December 31, 2002 - --------------------------------------------------------------------------------

Identity of Issue, Borrower, Description of Current Lessor, or Similar Party Investment Cost Value ------------------------------- ------------------------------------------- ----------------- ----------------- * INVESCO Funds Group INVESCO Cash Reserves Fund, 381,894 shares (a) $ 1,153,583 INVESCO Core Equity Fund , 64,051 shares (a) 736,464 INVESCO Select Income Fund, 48,247 shares (a) 339,934 INVESCO Balanced Fund, 43,802 shares (a) 535,176 INVESCO Dynamics Fund, 79,495 shares (a) 910,597 INVESCO Small Company Growth Fund, 1,239 shares (a) 28,851 IRT 500 Index Fund, 769 shares (a) 299,244 * Atlantic American Corporation Atlantic American Corporation common stock, 377,301 shares 633,424 615,000 * AIM Fund Management AIM Basic Value Fund, 6,765 shares (a) 220,806 * Janus Fund Janus Twenty Fund, 1,049 shares (a) 330,914 Janus Adviser Worldwide Fund, 400 shares (a) 44,679 * Fidelity Puritan (a) 370,757 * American Century 20th Century Ultra Investor (a) 156,839 * Various Plan Participants Participant loans with varying maturities and interest rates ranging from 5.75% to 10.5% - 46,256 ----------------- TOTAL $ 5,789,100 ----------------- -----------------
* Indicates party in interest (a) Participant-directed 12
                                EXHIBIT INDEX



Exhibit Number          Title
- --------------          -----

2                       Consent of Independent Accountants




CONSENT OF PUBLIC ACCOUNTANTS As independent public accountants, we hereby consent to the incorporation by reference of our report dated June 9, 2003, included in this Annual Report of the Atlantic American Corporation 401(k) Retirement Savings Plan on Form 11-K for the year ended December 31, 2002, into the Plan's previously filed Registration Statement No. 333-89891. GIFFORD, HILLEGASS & INGWERSEN, P.C. Atlanta, Georgia June 27, 2003