AssuranceAmerica (ASAM) 8-K Assuranceamerica Corporation Announces September 2006 Results Showing Continuing Profits

EXHIBIT 99.1

ASSURANCEAMERICA CORPORATION ANNOUNCES SEPTEMBER 2006 RESULTS SHOWING CONTINUING PROFITS

ATLANTA—(BUSINESS WIRE)—November 6, 2006—Atlanta-based ASSURANCEAMERICA CORPORATION (OTC BB: ASAM), today announced its unaudited financial results for September 2006 and the nine and three months ended September 30, 2006.

Revenues for the month of September 2006 increased 23% to $4.3 million, compared to $3.5 million for the same month of 2005. Revenues for the three-month period ended September 30, 2006 increased 32% to $13.1 million, compared with $9.9 million for the same period of 2005. Revenues for the nine months of 2006 increased 60 to $41.5 million, compared with $26.0 million for the same period of 2005.

Pretax earnings decreased 70% for the month of September 2006 to $183,000, compared to $602,000 in September 2005. Prior year pretax earnings included a quarter-end adjustment of approximately $200,000 which, by comparison with the current year, is now recorded on a monthly basis. The Company increased pretax earnings 10% for the three-month period ended September 30, 2006 to $0.9 million, compared with $0.8 million in the same period last year. The Company increased pretax earnings 39% for the first nine months of 2006 to $2.6 million, compared with $1.8 million in the same period last year.

Net income for the month of September decreased 62% to $230,000, compared with $602,000 in the same period of 2005. Prior year net income included a quarter-end adjustment of approximately $200,000 which, by comparison with the current year, is now recorded on a monthly basis. Net income for the three-month period ended September 30, 2006 increased 2% to $783,000, compared with $772,000 for the same period of 2005. Net income for the first nine months increased 6% to $1.9 million, compared with $1.8 million for the same period of 2005. Net income in 2005 reflected no provision for income taxes as the Company was able to fully utilize net operating tax loss carry forwards.

Gross Premiums Produced (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 11% from $9.9 million in September 2005 to $11.0 million in September 2006. Gross Premiums Produced increased 18% from $28.8 million for the three months ended September 30, 2005 to $34.2 million for the same period of 2006. Gross Premiums Produced increased 42% from $81.9 million for the nine months ended September 30, 2005 to $116.1 million for the same period of 2006. Gross Premiums Produced is used by management as the primary measure of the underlying growth of the Company’s revenue streams from period to period.

In announcing September’s and year-to-date results, Lawrence (Bud) Stumbaugh, President and CEO of AssuranceAmerica Corporation said, “Recent rate increases we filed, and that were approved in all the states where our Carrier/MGA writes, somewhat slowed our revenue growth. That’s not all bad as we don’t ever want to be a commodity bought on the basis of price alone. We’ve also added some expenses to strengthen our foundation so we can expand into other states at the end of this year and early into 2007. This negatively impacted the profit increases we are used to seeing each month. Nonetheless, we take great pride in 2006 year to date pre-tax earnings of $2.6 million when the same nine months a year earlier generated $1.8 million. We are headed for our best year ever and are making the right investments to enable us to improve in future periods.”

AssuranceAmerica focuses on the non-standard automobile insurance marketplace, primarily in Alabama, Florida, Georgia, South Carolina, and Texas. 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”).

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). Historical results are not indicative of future performance.

ASSURANCEAMERICA CORPORATION
(Unaudited) CONSOLIDATED BALANCE SHEETS
September 30, 2006 and December 31, 2005

	September 30, 2006			December 31, 2005
Assets
Cash and cash equivalents	$	5,470,746		$	8,668,827
Short term investments and other invested assets		900,350			120,000
Long term investments, available for sale at fair value		13,528,382			8,419,835
Investment income due and accrued		178,969			81,150
Receivable from insured		19,100,835			13,821,477
Reinsurance recoverable (including $4,731,970 and $4,213,187 on paid losses)		21,059,684			14,790,099
Prepaid reinsurance premiums		14,730,805			11,211,270
Deferred acquisition costs		889,956			798,539
Property and equipment (net of accumulated depreciation of $2,013,797 and $1,606,200)		2,112,994			1,400,667
Other receivables		2,819,299			1,674,184
Prepaid expenses		416,712			161,415
Intangibles (net of accumulated amortization of $1,700,818 and $1,398,244)		11,028,971			7,359,850
Security deposits		99,961			75,072
Prepaid income taxes		172,030			—
Deferred tax assets		372,615			—
Other assets		375,703			378,758
Total assets	$	93,258,012		$	68,961,143
Liabilities and Stockholders’ Equity
Accounts payable and accrued expenses	$	5,815,860		$	4,802,223
Unearned premium		21,691,636			16,574,473
Unpaid losses and loss adjustment expenses		23,325,306			15,109,874
Reinsurance payable		16,925,355			10,238,081
Provisional commission reserve		2,033,347			1,704,379
Notes payable		6,113,464			5,568,535
Dividends payable		84,000			—
Debentures payable		4,805,185			4,800,185
Capital lease obligations		286,157			220,155
Total liabilities		81,080,310			59,017,905
Stockholders’ equity
Common stock, .01 par value (authorized 120,000,000 and 80,000,000; outstanding 56,072,971 and 51,167,321)		560,730			511,673
Preferred stock, .01 par value (authorized 5,000,000, outstanding 840,000 and 1,266,000)		8,400			12,660
Surplus-paid in		16,230,513			15,678,015
Accumulated deficit		(4,652,661	)		(6,259,110	)
Accumulated other comprehensive (loss) income:
Net unrealized (loss) gain on investment securities		30,720			—
Total stockholders’ equity		12,177,702			9,943,238
Total liabilities and stockholders’ equity	$	93,258,012		$	68,961,143

2

ASSURANCEAMERICA CORPORATION
(Unaudited) CONSOLIDATED STATEMENTS OF OPERATIONS
For the Three and Nine Months Ended September 30, 2006 and 2005

	Three Months						Nine Months
	2006			2005			2006			2005
Revenue:
Gross premiums written	$	18,334,710		$	15,186,281		$	53,839,302		$	35,763,663
Gross premiums ceded		(12,530,148	)		(10,258,321	)		(36,609,876	)		(24,279,794	)
Net premiums written		5,804,562			4,927,960			17,229,426			11,483,869
Decrease (increase) in unearned premiums, net of prepaid reinsurance premiums		(600,836	)		(1,423,800	)		(1,597,628	)		(2,457,869	)
Net premiums earned		5,203,726			3,504,160			15,631,798			9,026,000
Commission income		5,251,593			4,517,482			17,676,337			12,285,770
Managing general agent fees		2,308,140			1,632,912			7,163,620			3,858,543
Net investment income		215,447			90,149			520,659			128,982
Other fee income		148,298			170,564			498,663			566,984
Total revenue		13,127,204			9,915,267			41,491,077			25,866,279
Expenses:
Losses and loss adjustment expenses		3,359,596			2,298,469			11,371,346			5,946,922
Selling expenses		4,589,521			3,891,711			15,029,042			10,434,211
General and administrative expenses		3,767,109			2,728,813			10,951,784			6,940,860
Depreciation and amortization expense		269,420			96,713			710,171			282,452
Interest expense		289,823			127,750			866,372			421,106
Total operating expenses		12,275,469			9,143,456			38,928,715			24,025,551
Income before provision for income tax expense		851,735			771,811			2,562,362			1,840,728
Income tax provision		68,428			—			618,715			—
Net income		783,307			771,811			1,943,647			1,840,728
Dividends on preferred stock		84,000			126,600			337,200			379,800
Net income attributable to common stockholders	$	699,307		$	645,211		$	1,606,447		$	1,460,928
Earnings per common share
Basic		0.013			0.013			0.030			0.029
Diluted		0.011			0.010			0.026			0.023
Weighted average shares outstanding-basic		54,857,778			50,434,801			52,779,929			50,183,303
Weighted average shares outstanding-diluted		64,470,290			63,589,401			62,392,441			63,337,903

3

ASSURANCEAMERICA CORPORATION
(Unaudited) CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Nine Months Ended September 30, 2006 and 2005

	2006			2005
Cash flows from operating activities:
Net income	$	1,943,647		$	1,840,728
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		710,171			282,452
Stock-based compensation		233,572			—
Changes in assets and liabilities:
Receivables		(6,424,473	)		(8,087,866	)
Prepaid expenses and other assets		(277,131	)		(272,254	)
Unearned premiums and other payables		5,117,163			7,646,406
Unpaid loss and loss adjustment expenses		8,215,432			2,252,346
Ceded reinsurance payable		6,687,274			4,381,573
Reinsurance recoverable		(6,269,585	)		(2,090,013	)
Prepaid reinsurance premiums		(3,519,535	)		(5,188,536	)
Accounts payable and accrued expenses		1,013,639			1,565,433
Prepaid income taxes		(172,030	)		—
Deferred tax assets		(372,615	)		—
Deferred acquisition costs		(91,417	)		(352,075	)
Provisional commission reserve		328,968			114,238
Net cash provided by operating activities		7,123,080			2,092,432
Cash flows from investing activities:
Purchases of property and equipment		(1,119,924	)		(344,987	)
Acquisitions of agencies		(3,971,695	)		—
Purchases of investments and accrued investment income		(5,955,996	)		(364,585	)
Net cash used by investing activities		(11,047,615	)		(709,572	)
Cash flows from financing activities:
Proceeds (repayments) of debt, net		549,929			(1,484,319	)
Preferred dividends paid		(253,200	)		(253,200	)
Proceeds (repayments) of capital lease obligations, net		66,002			—
Stock issued		363,723			4,212,775
Net cash provided by financing activities		726,454			2,475,256
Net (decrease) increase in cash and cash equivalents		(3,198,081	)		3,858,116
Cash and cash equivalents, beginning of period		8,668,827			7,059,188
Cash and cash equivalents, end of period	$	5,470,746		$	10,917,304

Please refer to our full 10QSB filing and the related Notes to Financial Statements

Contacts
AssuranceAmerica Corporation, Atlanta
Renee A. Pinczes, 770-952-0200 Ext. 105
Fax: 770-984-0173
rpinczes@aainsco.com

4