AssuranceAmerica (ASAM) 8-K Assuranceamerica Corporation Reports Record Revenue and Profit for the Third Quarter and Year-to-date

Exhibit 99.1

ASSURANCEAMERICA CORPORATION REPORTS RECORD REVENUE AND PROFIT FOR THE THIRD QUARTER AND YEAR-TO-DATE

ATLANTA, GEORGIA — November, 14, 2005

Atlanta based ASSURANCEAMERICA CORPORATION (OTC BB: ASAM.OB), today announced its financial results for the third quarter and nine months ended September 30, 2005.

Revenues for the third quarter increased 66% to $9.9 million, compared to $6.0 million for the third quarter of 2004. Pretax earnings and net income (which were the same) increased 681% for the third quarter of 2005 to $0.8 million, compared to a loss of $133,000 in the third quarter of 2004.

Revenues for the nine months of 2005 increased 44% to $25.9 million, compared with $18.0 million for the same period of 2004. The Company increased pretax earnings and net income 5671% for the first nine months of 2005 to $1.8 million, compared with a loss of $33,000, in the same period last year.

Total controlled premium (a non-GAAP financial measure), which includes gross written premium in the Carrier/MGA’s underwriting operations plus premiums for policies sold in the retail Agency subsidiary, increased 69% from the third quarter of 2004 to $29.8 million for the third quarter of 2005. Total controlled premium increased 38% to $81.6 million for the nine months of 2005 from the comparable 2004 period. Total controlled premium is used as the primary measure of the underlying growth of the Company’s revenue streams from period to period.

In announcing third quarter results, Lawrence (Bud) Stumbaugh, President and CEO of AssuranceAmerica Corporation said, “It is always good to produce positive results. It is even better to do so at a time when many insurance enterprises bemoan the ‘summer valley’ that the industry historically experiences following the ‘winter/spring peak’. The fact that our record results beat the traditional summer doldrums adds immensely to the pride we take in our team’s achievements.”

AssuranceAmerica focuses on the specialty automobile insurance marketplace, primarily in Florida, Georgia, Alabama and South Carolina. Its principal operating subsidiaries are TrustWay Insurance Agencies (“Agency”), which sells personal automobile insurance policies through its 32 retail agencies, AssuranceAmerica Managing General Agency (“MGA”), and AssuranceAmerica Insurance Company (“Carrier”).

This press release includes statements that may constitute “forward-looking” statements. These statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements inherently involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements, as discussed in the Company’s filings with the U.S. Securities Exchange Commission (SEC).

Contact:
AssuranceAmerica Corporation
Atlanta, Georgia
Renée A. Pinczes
770-952-0200 Ext. 105
770-984-0173 — Fax
RPinczes@aainsco.com

ASSURANCEAMERICA CORPORATION
(Unaudited) CONSOLIDATED BALANCE SHEETS
September 30, 2005 and December 31, 2004

	September 30,			December 31,
	2005			2004
Assets
Cash and cash equivalents	$	10,917,304		$	7,059,188
Short term investments		250,000			400,000
Long term investments		1,099,808			599,808
Investment income due and accrued		15,319			734
Receivables from insureds		11,801,411			5,170,840
Reinsurance recoverable (including $3,602,408 and $3,084,838 on paid losses)		12,633,788			10,543,775
Prepaid reinsurance premiums		10,480,366			5,291,830
Deferred acquisition costs		576,917			224,842
Property and equipment (net of accumulated depreciation of $1,279,086 and $1,094,131)		1,345,113			1,185,081
Due from related party		—			30,783
Other receivables		1,733,755			245,677
Prepaid expenses		334,251			52,260
Intangibles (net of accumulated amortization of $1,295,893 and $1,198,396)		7,462,292			5,399,789
Security deposits		79,420			89,158
Total assets	$	58,729,744		$	36,293,765
Liabilities and Stockholders’ Equity
Accounts payable and accrued expenses	$	4,470,072		$	2,904,640
Unearned premiums		15,479,595			7,833,189
Unpaid losses and loss adjustment expenses		12,907,971			10,655,625
Reinsurance payable		9,318,506			4,936,933
Provisional commission reserve		1,175,121			1,060,883
Debt, related party		5,891,960			7,376,279
Dividends payable		126,600			—
Capital lease obligations		265,545			265,545
Total liabilities		49,635,370			35,033,094
Stockholders’ equity
Common stock, 0.01 par value (authorized 80,000,000, outstanding 50,437,540 and 46,577,090 respectively)		504,377			465,771
Preferred stock, 0.01 par value (authorized 5,000,000, outstanding 1,266,000 and 426,000 respectively)		12,660			4,260
Surplus-paid in		15,198,712			8,872,943
Accumulated deficit		(6,621,375	)		(8,082,303	)
Total stockholders’ equity		9,094,374			1,260,671
Total liabilities and stockholders’ equity	$	58,729,744		$	36,293,765

See accompanying notes to consolidated financial statements.

ASSURANCEAMERICA CORPORATION
(Unaudited) CONSOLIDATED STATEMENTS OF OPERATIONS
For the Three and Nine Months Ended September 30, 2005 and 2004

	Three Months						Nine Months
	2005			2004			2005			2004
Revenue:
Gross premiums written	$	15,186,281		$	7,188,610		$	35,763,663		$	23,525,816
Gross premiums ceded		(10,258,321	)		(4,843,586	)		(24,279,794	)		(16,029,472	)
Net premiums written		4,927,960			2,345,024			11,483,869			7,496,344
Decrease (increase) in unearned premiums, net of prepaid reinsurance premiums		(1,423,800	)		83,844			(2,457,869	)		(829,091	)
Net premiums earned		3,504,160			2,428,868			9,026,000			6,667,253
Commission income		4,517,482			2,511,388			12,285,770			8,066,268
Managing general agent fees		1,632,912			844,069			3,858,543			2,536,996
Net investment income		90,149			6,741			128,982			17,794
Other fee income		170,564			193,803			566,984			687,052
Total revenue		9,915,267			5,984,869			25,866,279			17,975,363
Expenses:
Losses and loss adjustment expenses		2,298,469			1,790,091			5,946,922			5,122,048
Selling, general and administrative expenses		6,620,524			4,089,916			17,375,071			12,237,173
Depreciation and amortization expense		96,713			92,987			282,452			220,864
Interest expense		127,750			144,683			421,106			428,317
Total operating expenses		9,143,456			6,117,677			24,025,551			18,008,402
Income (loss) before provision for income tax expense		771,811			(132,808	)		1,840,728			(33,039	)
Income tax provision		—			—			—			—
Net income (loss)		771,811			(132,808	)		1,840,728			(33,039	)
Dividends on preferred stock		126,600			33,300			379,800			33,300
Net income (loss) attributable to common stockholders	$	645,211		$	(166,108	)	$	1,460,928		$	(66,339	)
Earnings per common share
Basic		0.013			(0.004	)		0.029			(0.001	)
Diluted		0.010			(0.004	)		0.023			(0.001	)
Weighted average shares outstanding-basic		50,434,801			45,498,718			50,183,303			45,498,718
Weighted average shares outstanding-diluted		63,589,401			45,498,718			63,337,903			46,498,718

See accompanying notes to consolidated financial statements.

ASSURANCEAMERICA CORPORATION
(Unaudited) CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Nine Months Ended September 30, 2005 and 2004

	2005			2004
Cash flows from operating activities:
Net income (loss)	$	1,840,728		$	(33,039	)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization		282,452			220,864
Changes in assets and liabilities:
Receivables		(8,087,866	)		(687,350	)
Prepaid expenses and other assets		(272,254	)		19,203
Unearned premiums and other payables		7,646,406			2,295,025
Unpaid loss and loss adjustment expenses		2,252,346			5,715,154
Ceded reinsurance payable		4,381,573			2,147,187
Reinsurance recoverable		(2,090,013	)		(5,272,204	)
Prepaid reinsurance premiums		(5,188,536	)		(1,465,933	)
Accounts payable and accrued expenses		1,565,433			341,955
Deferred acquisition costs		(352,075	)		(89,423	)
Provisional commission reserve		114,238			(574,786	)
Net cash provided by operating activities		2,092,432			2,616,653
Cash flows from investing activities:
Purchases of property and equipment		(344,987	)		(65,590	)
(Acquisitions)/Disposals		—			(1,300,000	)
Purchases of investments and accrued investment income		(364,585	)		(17,687	)
Net cash (used) by investing activities		(709,572	)		(1,383,277	)
Cash flows from financing activities:
Related party debt, net		(1,484,319	)		(522,000	)
Preferred dividends paid		(253,200	)		—
Capital contribution		—			2,090,536
Stock issued		4,212,775			681,500
Net cash provided by financing activities		2,475,256			2,250,036
Net increase in cash and cash equivalents		3,858,116			3,483,412
Cash and cash equivalents, beginning of period		7,059,188			3,130,553
Cash and cash equivalents, end of period	$	10,917,304		$	6,613,965

See accompanying notes to consolidated financial statements