As Filed with the Securities and Exchange Commission on April 30, 2019

Registration Nos. 2 ‑ 30771

811 ‑ 01764

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM N‑4

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

[ ] Pre‑Effective Amendment No.

[ x ] Post-Effective Amendment No. 67

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940

[ x ] Amendment No. 68

AMERICAN FIDELITY SEPARATE ACCOUNT A

(FORMERLY AMERICAN FIDELITY VARIABLE ANNUITY FUND A)

(Exact Name of Registrant)

AMERICAN FIDELITY ASSURANCE COMPANY

(Name of Depositor)

9000 CAMERON PARKWAY, OKLAHOMA CITY, OKLAHOMA 73114

(Address of Depositor’s Principal Executive Offices) (Zip Code)

Depositor’s Telephone Number, Including Area Code 405.523.2000

Christopher T. Kenney	Jennifer Wheeler
Senior Vice President and	Vice President and Senior Counsel
General Counsel	American Fidelity Assurance Company
American Fidelity Assurance Company	9000 Cameron Parkway
9000 Cameron Parkway	Oklahoma City, Oklahoma 73114
Oklahoma City, Oklahoma 73114
(Name and Address of Agent for Service)

Approximate Date of Proposed Public Offering:

As soon as practicable after effectiveness of the Registration Statement

It is proposed that this filing will become effective (check appropriate box)

[ ]

immediately upon filing pursuant to paragraph (b) of Rule 485

[ x ]

on May 1, 2019 pursuant to paragraph (b) of Rule 485

[ ]

60 days after filing pursuant to paragraph (a) (1) of Rule 485

[ ]

on (date) pursuant to paragraph (a) (1) of Rule 485

If appropriate, check the following box:

[ ]

This post‑effective amendment designates a new effective date for a previously filed post‑effective amendment.

Title of Securities Being Registered: Group variable annuity contracts

AFPR1ME

GROWTH

Variable Annuity^®

from

May 1, 2019

AFPR1ME GROWTH™ Variable Annuity

issued by

American Fidelity Separate Account A

and

American Fidelity Assurance Company

PROSPECTUS

May 1, 2019

American Fidelity Separate Account A (“Separate Account A”) is offering the AFPR1ME GROWTH™ Variable Annuity. The AFPR1ME GROWTH™ Variable Annuity is issued by American Fidelity Assurance Company in the form of group contracts between American Fidelity Assurance Company and the employer for use in qualified retirement plans or an individual using the contract to fund an Individual Retirement Annuity.

The assets of Separate Account A will be invested solely in Vanguard® Variable Insurance Fund Total Stock Market Index Portfolio (“Vanguard® VIF Total Stock Market Index Portfolio”), which seeks to track the performance of a benchmark index that measures the investment return of the overall U.S. stock market.

This prospectus contains important information about the AFPR1ME GROWTH™ Variable Annuity and Separate Account A that a prospective investor should know before investing. To learn more about the variable annuity and Separate Account A, you should read our Statement of Additional Information dated May 1, 2019 that we filed with the Securities and Exchange Commission (“SEC”). The SEC maintains a web site (www.sec.gov) that contains our Statement of Additional Information, material incorporated by reference into this prospectus and other material that we file electronically with the SEC. The Statement of Additional Information is incorporated by reference into this prospectus. The table of contents of the Statement of Additional Information appears on the last page of this prospectus. For a free copy of our Statement of Additional Information, contact us at:

Telephone: 1.800.662.1113

U.S. Mail: P.O. Box 25520, Oklahoma City, Oklahoma 73125-0520

Email: va.help@americanfidelity.com.

Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of the shareholder report for Vanguard® VIF Total Stock Market Index Portfolio, the portfolio company available under your contract, will no longer be sent by mail, unless you specifically request paper copies of the reports from us. Instead, the reports will be made available on a website, and you will be notified by mail each time a report is posted and provided with a website link to access the report.

If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive shareholder reports and other communications from the Registrant electronically by contacting us, as set forth above. You may elect to receive all future reports in paper free of charge. You can inform us that you wish to continue receiving paper copies of your shareholder reports by contacting us, as set forth above.

The Securities and Exchange Commission has not approved or disapproved these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. This prospectus may only be used to offer the contract where the contract may be lawfully sold. The contract and certain features described in the contract may only be available in certain states.

Please read this prospectus carefully and keep it for future reference.

GLOSSARY OF TERMS

Some of the terms used in this prospectus are technical. To help you understand these terms, we have defined them below.

Account value: The value of a participant’s account during the accumulation phase.

Accumulation phase: The period of time between when a participant elects to participate in the plan and ending when a participant begins receiving annuity payments. Until a participant begins receiving annuity payments, the participant’s annuity is in the accumulation phase.

Accumulation unit: The unit of measurement used to keep track of the value of a participants interest in a sub-account during the accumulation phase or period.

Annuitant: The person on whose life annuity payments are based.

Annuity: A series of installment payments either for a fixed period or for the life of the annuitant, or for the joint lifetime of the annuitant and another person.

Annuity date: The date annuity payments begin.

Annuity options: The pay-out methods available during the annuity phase.

Annuity payments: Regular income payments received from the policy during the annuity phase.

Annuity phase: The period during which we make annuity payments.

Annuity unit: The unit of measure we use to calculate annuity payments during the annuity phase.

Contract: The master group contract between American Fidelity Assurance Company and a contract owner.

Contract owner: The entity to which a contract is issued, which is normally the employer of participants or an organization representing an employer.

Participant: A person for whom an interest is maintained under a group variable annuity policy, generally an employee.

Participant account: The account maintained for each participant reflecting the accumulation units credited.

Policy: The AFPR1ME GROWTH™ Variable Annuity.

Portfolio company: The Vanguard® Variable Insurance Fund (“VIF”) Total Stock Market Index Portfolio.

Purchase payment: Money invested in the contract by or on behalf of a participant and allocated to a participant’s account.

Separate Account: The separate account is called American Fidelity Separate Account A, which is a unit investment trust registered with the Securities and Exchange Commission under the Investment Company Act of 1940.

We, Us, Our: American Fidelity Assurance Company, the insurance company offering the contract or policy.

You, Your: A participant in the contract, generally an employee.

TABLE OF CONTENTS

Page

Summary

Fee Table

Condensed Financial Information

The AFPR1ME GROWTH™ Variable Annuity

Purchasing Accumulation Units

Receiving Payments From the Annuity

Expenses

Withdrawals

Death Benefit

Taxes

Other Information

Legal Proceedings

Financial Statements

Table of Contents of Statement of Additional Information

iii

SUMMARY

In this summary, we discuss some of the important features of the group variable annuity contract. You should read the entire prospectus for more detailed information about your account and Separate Account A.

The AFPR1ME GROWTH™ Variable Annuity is a contract between (1) an employer, who is the contract owner on behalf of its participants, or an individual using the contract to fund an Individual Retirement Annuity, and (2) American Fidelity Assurance Company, which is the insurance company. Money invested in the AFPR1ME GROWTH™ Variable Annuity is invested in the Vanguard® VIF Total Stock Market Index Portfolio. The AFPR1ME GROWTH™ Variable Annuity is designed for individuals seeking long-term investments, generally for retirement or other long-term purposes. You should not become a participant in the AFPR1ME GROWTH™ Variable Annuity if you are looking for a short-term investment or if you cannot afford to lose some or all of your investment.

Like all deferred annuities, the annuity contract has two phases: the accumulation phase and the annuity phase. During the accumulation phase, you invest money in your annuity, and your earnings accumulate on a tax-deferred basis. You can withdraw money from your participant account during the accumulation phase, but federal income tax and penalties may apply. A qualified plan already provides tax-deferral; therefore, there should be other reasons for purchasing the policy pursuant to a qualified plan aside from the tax-deferral feature.

The annuity phase begins when you start receiving regular payments under the annuity income options from your participant account. Among other factors, the amount of the payments you may receive during the annuity phase will depend on the amount of money you invest in your participant account during the accumulation phase and on the investment performance of the Vanguard® VIF Total Stock Market Index Portfolio.

The money you invest in your AFPR1ME GROWTH™ Variable Annuity is used to purchase, at net asset value, shares of Vanguard® VIF Total Stock Market Index Portfolio. Past performance does not guarantee future results.

Generally, the premium deposits you make are excludable from your gross income, and earnings are not taxed until you make a withdrawal. If you withdraw any money before you are 59½, you may be charged a federal tax penalty on the taxable amounts withdrawn. In most cases, the penalty is 10% on the taxable amounts. All payments during the annuity period are taxable.

You may withdraw money at any time during the accumulation phase. No fees are charged for withdrawals. Restrictions exist under federal tax law concerning when you can withdraw money from a qualified plan, and you may have to pay income tax and a tax penalty on any money you withdraw. If a withdrawal causes your participant account to have a remaining value of less than $1,000, we may redeem all your accumulation units and cancel your account.

Although the contract does not have a “free-look” provision, you do have the right to withdraw all or part of the value of your participant account at any time without paying a withdrawal fee. If the contract is returned to us or our representative within 30 calendar days after it is delivered, we will refund the greater of the purchase payments paid or the account value.

Questions. If you have any questions about your contract or need more information, please contact us at:

American Fidelity Assurance Company

Annuity Services Department

P.O. Box 25520

Oklahoma City, OK 73125-0520

Telephone: 1.800.662.1113

E-mail: va.help@americanfidelity.com

FEE TABLE

The following tables describe the fees and expenses that you will pay when buying, owning and surrendering your policy. The first table describes the fees and expenses that you will pay at the time you buy your policy or make a purchase payment. State premium taxes may also be deducted.

One-time Contract Certificate Fee…………………

$15.00

Participant Transaction Expenses (as a percentage of purchase payments)

Sales Charge	3.00%
Administrative Expense	0.25%
Minimum Death Benefit Expense*	0.75%
Deferred Sales Load	None
Surrender Fees	None

*Not applicable after age 65.

The next table describes the fees and expenses that you will pay periodically during the time that you own the policy, not including the portfolio company fees and expenses.

Per Payment Charge…………………………………

$ 0.50

Separate Account A Annual Expenses (as a percentage of average account value)

Mortality and Expense Risk Fees

0.96025%

The next table shows the minimum and maximum total operating expenses charged by Vanguard® VIF Total Stock Market Index Portfolio that you pay periodically during the time that you own the policy. Additional information about the Vanguard® VIF Total Stock Market Index Portfolio’s fees and expenses is contained in the Vanguard® VIF Total Stock Market Index Fund’s Summary Prospectus (the “Vanguard Summary Prospectus”).

Total Annual Portfolio Company Operating Expenses

(expenses that are deducted from portfolio assets)

MINIMUM

0.13%

MAXIMUM

0.13%

Vanguard® VIF Total Stock Market Index Portfolio

Management Expenses	0.00%
Investment Advisory Fee	0.00%
Acquired Fund Fees and Expenses	0.13%
Total Annual Portfolio Operating Expenses	0.13%

The purpose of the fee table is to show you the various costs and expenses that you will bear directly or indirectly. The table reflects the expenses of both Separate Account A and Vanguard® VIF Total Stock Market Index Portfolio. For a more complete explanation of each of the expense components, see the information under “Expenses” that appears elsewhere in this document, as well as the description of expenses of Vanguard® VIF Total Stock Market Index Portfolio in the Vanguard Summary Prospectus. Although premium taxes are not reflected in the fee table, they may apply.

Example

The example is intended to help you compare the cost of investing in the policy with the cost of investing in other variable annuity contracts. These costs include contract owner transaction expenses, contract fees, separate account annual expenses and portfolio company fees and expenses.

This example also assumes that (i) you invest $10,000 in the policy, (ii) your investment has a 5% return each year, and (iii) the maximum fees and expenses of the portfolio company apply. Although your actual costs may be higher or lower, based on these assumptions, the example shows the expenses you would pay on a $10,000 investment. Because no surrender fees or deferred sales load charges apply, the expenses below show the amount you would pay regardless of whether you surrender your policy at the end of each time period or do not surrender your policy or if you annuitize.

1 Year		3 Years	5 Years	10 Years
$522		$747	$991	$1,686

The example should not be considered a representation of past or future expenses. Actual expenses may be greater or less than those shown above. Similarly, the 5% annual rate of return assumed in the example is not an estimate or guarantee of future performance.

CONDENSED FINANCIAL INFORMATION

During the accumulation phase, we calculate the value of each policy owner’s share of different sub-accounts, with a unit of measurement called an accumulation unit. The following table shows accumulation unit values and the number of accumulation units outstanding for Separate Account A for the last ten years, as derived from the financial statements of Separate Account A. The accumulation unit information reflects Separate Account A’s operations as a unit investment trust investing in Vanguard® VIF Total Stock Market Index Portfolio since December 1, 2014 and in American Fidelity Dual Strategy Fund prior to that date.

	2018	2017	2016	2015	2014	2013	2012	2011	2010	2009
Accumulation Unit value:
Beginning of year…	58.137	$48.523	$43.526	$43.784	$39.748	$30.286	$26.275	$26.511	$22.545	$18.209
End of year………	54.507	$58.137	$48.523	$43.526	$43.784	$39.748	$30.286	$26.275	$26.511	$22.545
Number of Accumulation Units outstanding at end of year (in 000’s)…	$3,254	$3,501	$3,713	3,924	4,171	4,467	4,793	5,151	5,446	5,739

THE AFPR1ME GROWTH™ VARIABLE ANNUITY

About the Contract

The AFPR1ME GROWTH™ Variable Annuity is a group annuity. A group annuity is a contract between (1) an employer, who is the contract owner on behalf of its participants, or an individual using the contract to fund an Individual Retirment Annuity, and (2) an insurance company (in this case American Fidelity Assurance Company), where the insurance company promises to pay the participant or someone else you choose an income in the form of annuity payments beginning on a date chosen. The person upon whose life the policy is based is called the annuitant, even if that person is you. If the annuitant dies during the accumulation phase, American Fidelity Assurance Company will pay a death benefit to your beneficiary.

We may change the AFPR1ME GROWTH™ Variable Annuity at any time if required by state or federal laws. After a contract has been in force for three years, we may change any term of the contract except that benefits already earned by participants cannot be decreased and guaranteed monthly life incomes cannot be decreased. We will notify contract owners of any change at least 90 calendar days before a change will take effect.

Naming a Beneficiary

A beneficiary is the person or entity that you name to receive the benefit of your policy upon the death of the annuitant. You name the beneficiary or beneficiaries at the time you become a participant in the contract, but you may change beneficiaries at a later date. If the beneficiary and the annuitant die at the same time, we will assume that the beneficiary died first for purposes of paying any death benefits.

You can change the beneficiary of your policy at any time during the annuitant’s life, unless you name the person as an irrevocable beneficiary. The interest of an irrevocable beneficiary cannot be changed without his or her written consent.

To change your beneficiary, you need to send a request on a form we accept to our home office. The change will go into effect when signed, subject to any payments we make or actions we take before we record the change. A change cancels all prior beneficiaries, except any irrevocable beneficiaries. The interest of the beneficiary will be subject to any annuity option in effect at the time of the annuitant’s death.

Voting Rights

American Fidelity Assurance Company is the legal owner of the Vanguard® VIF Total Stock Market Index Portfolio shares allocated to Separate Account A. However, we believe that when Vanguard® VIF Total Stock Market Index Portfolio solicits proxies in conjunction with a shareholder vote, we are required to obtain from participants instructions as to how to vote those shares. When we receive these instructions, we will vote all of the shares we own for the benefit of Separate Account A in proportion to those instructions. This type of voting may allow a small number of participants to control the outcome of the vote. Should we determine that we are no longer required to comply with the above, we will vote the shares in our own right.

Substitution

We cannot guarantee that Vanguard® VIF Total Stock Market Index Portfolio will always be available for our variable annuity products. If it should not be available, we will try to replace it with a comparable fund. A substitution of shares attributable to the contracts will not be made without prior notice to contract owners and participants and the prior approval of the SEC in conformity with the Investment Company Act of 1940.

PURCHASING ACCUMULATION UNITS

Purchase Payments

In order to keep track of the value of your account during the accumulation phase, we use a measurement called an accumulation unit. Each time you invest money with us, you are making a purchase payment. Every purchase payment you make increases the number of accumulation units in your participant account. You may make purchase payments at any time during the accumulation phase. Your first purchase payment must be at least $20, and after that, each purchase payment must be at least $10. You may increase, decrease or change the frequency of your purchase payments at any time. We reserve the right to reject any application or purchase payment.

Once we receive your initial purchase payment and application, we will issue you a certificate evidencing your participation in the annuity contract. We will invest your first purchase payment within two business days of receiving it. If you do not give us all of the information we need, we will contact you to get it. If for some reason we are unable to complete the initial application process within five business days, we will either send your money back to you or get your permission to keep it until we get all of the necessary information. After your initial purchase payment, we will credit all subsequent purchase payments to your participant account using the accumulation unit value next determined after receipt. If we receive a purchase payment by 3:00 p.m., Central Time, we will apply same-day pricing to determine the number of accumulation units to credit to your account.

Accumulation Units

The value of your participant account will go up or down depending upon the investment performance of Vanguard® VIF Total Stock Market Index Portfolio and the expenses of, and deductions charged by, Separate Account A. The value of your participant account is based on the number of accumulation units in your account and the value of the accumulation units.

We calculate the value of an accumulation unit after the New York Stock Exchange closes on each day that both the New York Stock Exchange and American Fidelity Assurance Company are open, and then credit your participant account accordingly. We determine the value of an accumulation unit by dividing the total value of net assets by the number of the outstanding accumulation units. The value of an accumulation unit may go up or down from day to day.

The value of your account at any time before you begin receiving annuity payments is determined by multiplying the total number of accumulation units credited to your account by the current accumulation unit value. When you make a purchase payment, we credit your participant account with accumulation units. The number of accumulation units credited is determined by dividing the amount of the net purchase payment (after deduction of 4% to cover sales, administrative and minimum death benefit charges and $0.50 per purchase payment) by the value of the accumulation unit. For example, on Thursday morning, we receive a premium deposit of $100 from you. At 3:00 p.m., Central Time, on that Thursday, we determine that the value of an accumulation unit is $20.25. We then divide $95.50 by $20.25 and credit your participant account on Thursday night with 4.72 accumulation units. A $15 certificate fee will also be deducted from the first purchase payment.

Each participant is advised semiannually of the number of accumulation units credited to his or her account, the current accumulation unit value, and the total value of the account.

RECEIVING PAYMENTS FROM THE ANNUITY

Annuity Date

Upon investing in the AFPR1ME GROWTH™ Variable Annuity, you may select an annuity date, which is the month and year that you will begin receiving regular monthly income payments from the annuity. You may select your desired annuity date at any time after your initial investment and you may change the annuity date if you choose; however, you must notify us of your desired annuity date at least 30 calendar days before you want to begin receiving annuity payments. The annuity date may not be later than the earliest to occur of the distribution date required by federal law, the contract owner’s tax qualified plan or, if applicable, state law.

Selecting an Annuity Option

On your annuity date, we will begin making annuity payments in accordance with one of our annuity options. If the value of your participant account is at least $5,000, you may choose from our various annuity options. You must designate the annuity option you prefer at least 30 calendar days before your annuity date. If you do not choose an annuity option, we will make annuity payments to you in accordance with Option 2 below. If the value of your account is less than $1,000, we reserve the right to pay you the entire amount of your participant account in one lump sum on your annuity date.

Annuity Payments

Although we reserve the right to change the frequency of the payments, annuity payments are paid in monthly installments unless you elect to receive them quarterly, semi-annually or annually. Electing to receive payments less frequently will increase the individual payment amount. However, the amount of the quarterly, semi-annual or annual installments will be actuarially equivalent (mathematically equivalent) to the monthly installment.

Annuity payments may be made on a variable basis or on a fixed basis. Payments made on a variable basis are based on the actual investment performance of Vanguard® VIF Total Stock Market Index Portfolio. Payments made on a fixed basis are based on a dollar amount that is fixed as of the annuity date and an annual rate of interest of 4%. If you choose a fixed annuity, your annuity payments will be based on an interest rate of 4% regardless of the actual performance of Vanguard® VIF Total Stock Market Index Portfolio.

If you choose to have any portion of your annuity payments based on a variable annuity option, the amount of your first annuity payment will be based on an assumed investment rate of 4.5%. The amount of subsequent annuity payments you receive may be more or less than your initial payment depending on three things:

·	the value of your participant account on the annuity date,

·	the assumed investment rate of 4.5%, and

·	the performance of Vanguard® VIF Total Stock Market Index Portfolio.

After you receive your first annuity payment, if Vanguard® VIF Total Stock Market Index Portfolio’s actual performance exceeds the 4.5% assumed rate, your monthly annuity payments will increase. Similarly, if the actual performance rate is less than 4.5%, your annuity payments will decrease relative to the first payment you received. The amount of the first annuity payment will depend on the annuity option elected and the age of the annuitant at the time the first payment is due.

You may choose one of the following annuity options at any time during the accumulation period. After your annuity payments begin, you cannot change your annuity option.

Option 1 Life Variable Annuity	We will make monthly payments during the life of the annuitant. If this option is elected, payments will stop when the annuitant dies.
Option 2 Life Variable Annuity with Payments Certain	We will make monthly payments for the guaranteed period selected and thereafter during the life of the annuitant. When the annuitant dies, any amounts remaining under the guaranteed period selected will be distributed to the beneficiary at least as rapidly as they were being paid as of the date of the annuitant’s death. If the beneficiary dies before the end of the guaranteed period, the present value of the remaining payments will be paid to the estate of the beneficiary based on an annual compound interest rate of 3.5%. The guaranteed period may be 10 years, 15 years or 20 years.
Option 3 Unit Refund Life Variable Annuity	We will make monthly payments during the lifetime of the annuitant. Upon the annuitant’s death, we will make an additional payment equal to the value at the date of death of the number of variable annuity units equal to the excess, if any, of (a) the total amount applied under this option divided by the variable annuity unit value on the annuity date over (b) the variable annuity units represented by each annuity payment multiplied by the number of annuity payments paid prior to death.
Option 4 Joint and Survivor Annuity	We will make monthly payments during the joint lifetime of the annuitant and a joint annuitant. Payments will continue during the lifetime of the surviving annuitant based on 66 2/3% of the annuity payment in effect during the joint lifetime. If the joint annuitant is not the annuitant’s spouse, this annuity option may not be selected if, as of the annuity date, the present value of the annuity payments which would be payable to the joint annuitant exceeds 49% of the present value of all payments payable to the annuitant and the joint annuitant.
Option 5 Fixed Annuity	You may elect forms of fixed annuities that have essentially the same characteristics as Annuity Options 1 through 4 above.

You may change your annuity option by written request at any time before you begin receiving annuity payments. Any change must be requested at least 30 calendar days before the annuity date. If an option is based on life expectancy, we may require proof of the payee’s date of birth.

EXPENSES

Charges and other expenses associated with the AFPR1ME GROWTH™ Variable Annuity will reduce your investment return. These charges and expenses are explained below.

Sales Charge	We deduct a 3% sales charge from each purchase payment to recover our distribution expenses. The sales charge for lump sum or periodic payments of $2,000 or more may be less than 3%.
Insurance Charges Administrative Expenses	We deduct 0.25% of each purchase payment we receive to recover administrative expenses, including, but not limited to, salaries, printing, legal, actuarial and accounting fees. We also charge an additional $0.50 administrative charge against each purchase payment (for the processing of each purchase payment received for each plan participant) and a one-time certificate issuance fee of $15 (which is applied toward the expense of setting up each new administrative record).
Minimum Death Benefit	A deduction of 0.75% of each purchase payment is made to cover our costs associated with the minimum death payment. This deduction is not applicable after you reach age 65.
Mortality and Expense Risk	We assume the risk that participants will live longer than we expect and that we will not have enough money to pay all of the annuity payments we are obligated to pay. We receive 0.96025% on an annual basis (0.0026308% for each one-day valuation period) of average account value for mortality and expense risks assumed. Of this amount, 0.85% is for mortality risks and 0.11025% is for expense risks.
Taxes Premium Taxes	Some states and other governmental entities, such as municipalities, charge premium or similar taxes. We are responsible for paying these taxes and will deduct the amount of taxes paid on your behalf from the value of your participant account. Some taxes are due when premium deposits are made; others are due when annuity payments begin. Currently, we pay any premium taxes when they become payable to the states. Premium taxes generally range from 0% to 3.5%, depending on the state.
Income Taxes	We may deduct from each contract any income taxes which the separate account may incur.
Portfolio Expenses	Deductions are taken from, and expenses paid out of, the assets of Vanguard® VIF Total Stock Market Index Portfolio. Because Separate Account A purchases shares of Vanguard® VIF Total Stock Market Index Portfolio, the net assets of Separate Account A will reflect the total annual portfolio company operating expenses deducted from Vanguard® VIF Total Stock Market Index Portfolio assets. You should read the Vanguard Summary Prospectus for information about such deductions.

WITHDRAWALS

You may redeem all or part of the accumulation units in your participant account at any time before we begin making annuity payments to you. The redemption value of your account is equal to the value of the accumulation units in your account next computed after we receive the request for redemption. There is no assurance that the redemption value of your participant account will equal or exceed the aggregate amount of purchase payments. We do not charge any administrative fees for withdrawals.

If you redeem part of the accumulation units in your account, the number of accumulation units in your participant account will decrease. The reduction in the number of accumulation units will equal the amount withdrawn divided by the applicable accumulation unit value next computed after we receive the redemption request. If a partial redemption reduces the value of your participant account to less than $1,000, we reserve the right to pay you the cash value of all of the accumulation units in your account and cancel your account.

A participant’s request for redemption should be submitted to us in writing on a form we accept, with the signature of the person in whose name the participant account is registered. In certain instances, we may require additional documents, such as trust instruments, death certificates, appointments as executor or administrator, or certificates of corporate authority. All proper redemption requests received before 3:00 p.m., Central Time, will receive same-day pricing.

Payments for units redeemed will be mailed within three to five business days after we receive a request that is in good order. However, we may delay the mailing of a redemption check for recently purchased accumulation units until such time as the payment check has cleared. Redemption rights may be suspended or payment postponed at times when:

·	the New York Stock Exchange is closed (other than customary weekend and holiday closings) or trading on the New York Stock Exchange is restricted;

·	an emergency exists as a result of which disposal by Vanguard® VIF Total Stock Market Index Portfolio of securities owned by it is not reasonably practicable or it is not reasonably practicable for Vanguard® VIF Total Stock Market Index Portfolio to determine the value of its net assets; or

·	for such other periods as the SEC may by order permit for the protection of participants.

Restrictions exist under federal income tax law concerning when you can make withdrawals from a qualified plan. In addition, certain adverse tax consequences may result from withdrawals, as explained below under “Taxes” and in the related discussion of our Statement of Additional Information.

Frequent Purchases and Withdrawals

Market timing policies are designed to address the excessive short-term trading of investment company shares by a policy owner or policy owners that may be harmful to the remaining policy owners. Although market timing is generally not illegal, we are aware that successful market timers may, in some circumstances, make profits at the expense of passive participants who engage in various long-term or passive investment strategies. At this time, Separate Account A offers a single investment option, so it does not create the same opportunities for market timing that separate accounts offering multiple investment options create. However, in order to minimize any opportunity for market timing activities which may be achieved by withdrawing funds and reinvesting in Separate Account A, we have adopted the following specific policies:

·	We deduct a sales charge, an administrative charge and a minimum death benefit charge from each purchase payment we receive. While not designed specifically to discourage market timing activities these expenses have a tendency to discourage it.

After full redemption and cancellation of a participant’s account, no further purchase payments may be made on behalf of the participant. In addition, if the value of any participant account falls below $1,000 as the immediate result of a withdrawal, that participant’s account may be terminated at our option.

·	We do not accept telephone transactions.

·	We have adopted a policy requiring our personnel to maintain a record of all orders received between 2:45 p.m. and 3:00 p.m. Central Time. This record is reviewed monthly and any suspicious patterns are reported and subjected to additional review.

If Separate Account A offers more than one investment option in the future, we may adopt additional policies to limit the possibility of market timing that might be accomplished by switching back and forth between investment options.

DEATH BENEFIT

In the event of a participant’s death before receipt of annuity payments, death proceeds are payable to the person’s named beneficiary in an amount equal to:

·	the value of the participant’s account as of the valuation date (the date on which we have received both written notice of death and the beneficiary’s written instructions), or

·	if greater, and if the participant’s death occurs before age 65, 100% of the total purchase payments made by the participant, less any redemptions.

Payments normally are made within seven calendar days of receipt of notice.

If a participant dies during the annuity period, we will pay any remaining guaranteed payments to:

·	the participant’s beneficiary, or

·	the participant’s estate, if no beneficiary survives.

Any payments made to a beneficiary must be made on a payment schedule at least as rapid as that made to the participant.

A beneficiary who is the spouse of a deceased participant may choose to receive the death benefit in any form that the participant could have chosen to receive annuity payments. Federal tax law requires that annuity contracts issued after January 18, 1985 restrict the length of time over which non-spouse beneficiaries may elect to receive death benefit proceeds. Contracts issued after January 18, 1985 provide that non-spouse beneficiaries must either:

·	take a total distribution within five years of the death of the participant, or

·	by the end of the year following the participant’s death, begin receiving payments for a period not to exceed the expected lifetime of the beneficiary.

TAXES

NOTE: The following is a description of federal income tax law applicable to tax-qualified annuities that are used in connection with Qualified Retirement Plans in general and is not intended as tax advice. American Fidelity Assurance Company does not guarantee the tax status of the policies. Purchasers bear the complete risk that the policies may not be treated as “Annuity Contracts” under federal income tax laws. It should be further understood that the following discussion is not exhaustive and that special rules not described herein may be applicable in certain situations. Moreover, no attempt has been made to consider any applicable state or other tax laws. You should seek competent tax advice regarding the matters discussed in this Prospectus and the Statement of Additional Information.

General

Section 72 of the Internal Revenue Code of 1986, as amended (the “Code”), governs taxation of annuities in general. A participant is not taxed on increases in the value of his or her participant account until distribution occurs, either in the form of a lump sum payment or as annuity payments under the annuity option elected. For a lump sum payment received as a total surrender (total redemption) or death benefit, the recipient is taxed on the portion of the payment that exceeds the participant’s cost basis, which may be zero. The taxable portion of a lump sum payment is taxed at ordinary income tax rates.

For annuity payments, a portion of each payment in excess of an exclusion amount is includible in taxable income. For traditional IRAs, SEPs and salary reduction SEPs, the exclusion amount for payments based on a fixed annuity option is determined by multiplying the payment by the ratio that the participant’s cost basis (adjusted for any period certain or refund feature) bears to the expected return under the contract. For traditional IRAs, SEPs and salary reduction SEPs, the exclusion amount for payments based on a variable annuity option is determined by dividing the participant’s cost basis (adjusted for any period certain or refund feature) by the number of years over which the annuity is expected to be paid. Payments received after the participant’s investment has been recovered (i.e., when the total of the excludable amounts equal the participant’s investment) are fully taxable. The taxable portion is taxed at ordinary income rates. For Section 401(a), 401(k), and 403(a) qualified pension, profit-sharing or annuity plans and 403(b) tax-deferred annuities (“Qualified Plans”), the exclusion amount is generally determined by dividing the cost-basis of the contract by the anticipated number of payments to be made under the contract. Participants, annuitants and beneficiaries under the contracts should seek competent financial advice about the tax consequences of any distributions.

American Fidelity Assurance Company is taxed as a life insurance company under the Code. For federal income tax purposes, Separate Account A is not a separate entity from American Fidelity Assurance Company, and its operations form a part of American Fidelity Assurance Company.

Qualified Plans

The contracts offered by the Prospectus are designed to be suitable for use under various types of retirement plans (“Qualified Plans”) that receive favorable tax treatment under the Internal Revenue Code of 1986, as amended (the “Code”) Qualified Plans include 401(a), 401(k), and 403(a) qualified pension, profit-sharing or annuity plans and 403(b) tax-deferred annuities and IRAs.

Because of the minimum premium deposit requirements, the contracts may not be appropriate for some periodic payment retirement plans.

Taxation of participants in each Qualified Plan varies with the type of plan and terms and conditions of each specific plan. Participants, annuitants and beneficiaries are cautioned that benefits under a Qualified Plan may be subject to the terms and conditions of the plan regardless of the terms and conditions of the contracts issued pursuant to the plan. Some retirement plans are subject to distribution and other requirements that are not incorporated into American Fidelity Assurance Company’s administrative procedures. Participants, annuitants and beneficiaries are responsible for determining that contributions, distributions and other transactions with respect to the contracts comply with applicable law. The tax rules regarding qualified plans are very complex and will have differing applications, depending on individual facts and circumstances. Each purchaser should obtain competent tax advice prior to participating in a contract issued under a qualified plan.

Transfers

Generally, contracts issued pursuant to Qualified Plans are not transferable except upon surrender or annuitization. Various penalty and excise taxes may apply to contributions or distributions made in violation of applicable limitations. Furthermore, certain withdrawal penalties and restrictions may apply to surrenders from qualified policies.

Tax Treatment of Assignments

Contracts issued pursuant to Qualified Plans generally may not be assigned. The assignment or pledge of an IRA Contract or other policy may be a taxable event. The owner of a contract should consult competent tax advisers before assigning or pledging the contract.

Multiple IRA Contracts

For purposes of determining the tax consequences of any distributions made pursuant to IRAs, SEPs and salary reduction SEPs (“IRA Contracts”), all IRA Contracts are treated as one contract and all distributions during a taxable year are treated as one distribution.

Tax Treatment of Distributions

Special Tax Treatment for Lump Sum Distributions from Qualified Plans. If the taxpayer receives an amount from a Qualified Plan issued pursuant to a Qualified Plan and the distribution qualifies as a lump sum distribution under the Code, the portion of the distribution that is included in income may be eligible for special tax treatment. The plan administrator should provide the taxpayer with information about the tax treatment of a lump sum distribution at the time the distribution is made.

Special Rules for Distributions that are Rolled Over. Special rules apply to a distribution from a contract that relates to a Qualified Plan Contract or a rollover IRA Contract if the distribution is properly rolled over in accordance with the provisions of the Code. These provisions contain various requirements, including the requirement that the rollover be made directly from the distributing plan or within 60 calendar days of receipt:

•	To a traditional IRA under Section 408 of the Code;

•	To another, similar Qualified Plan; or

•	To a Section 403(b) Plan or to a 457(b) Governmental Deferred Compensation Plan.

These special rules only apply to distributions that qualify as “eligible rollover distributions” under the Code. In general, a distribution from a Qualified Plan Contract will be an eligible rollover distribution except to the extent:

•	It is part of a series of substantially equal periodic payments made for the taxpayer’s life (or life expectancy) or the joint lives (or joint life expectancies) of the taxpayer and his beneficiary under the plan or for a period of more than ten years;

•	It is a required minimum distribution under Section 401 (a)(9) of the Code as described below; or

•	It is made from a Qualified Plan by reason of a hardship.

The administrator of the applicable Qualified Plan should provide additional information about these rollover tax rules when a distribution is made.

Distributions in the Form of Annuity Payments. If any distribution from a Qualified Plan Contract is made in the form of annuity payments (and is not eligible for rollover or is not in any event rolled over), a fixed portion of each payment is generally excludable from income for federal income tax purposes to the extent it is treated as allocable to the taxpayer’s “after-tax” contributions to the contract (and any other cost basis in the contract). To the extent the annuity payment exceeds such portion, it is includable in income. The portion of the annuity payment that is excludable from income is determined under detailed rules provided in the Code. If the annuity payments continue after all excludable amounts have been paid, such additional payments will generally be fully included in income.

Penalty Tax on Withdrawals prior to age 59½. Generally, there is a penalty tax equal to 10% of the portion of any payment prior to age 59½ from a Qualified Plan Contract that is included in income. This 10% penalty will not apply if the distribution meets certain conditions. Some of the distributions that are exempted from the 10% penalty are listed below:

•	A distribution that is made on or after the date the taxpayer reaches age 59½;

•	A distribution that is properly rolled over to a traditional IRA or to another eligible employer plan or account;

•	A distribution that is made on or after the death of the taxpayer;

•	A distribution that is made when the taxpayer is totally disabled (as defined in Section 72(m)(7) of the Code);

•

A distribution that is made as part of a series of substantially equal periodic payments which are made at least annually for the taxpayer’s life (or life expectancy) or the joint lives (or joint life expectancies) of the taxpayer and his joint beneficiary under the Qualified Contract (and, with respect to Qualified Plan Contracts, which begin after the taxpayer separates from service with the employer maintaining the plan);

•	A distribution that is made to the taxpayer by reason of separation from service with the employer maintaining the plan during or after the calendar year in which the taxpayer reaches age 55;

•	A distribution that is made to the taxpayer to the extent it does not exceed the amount allowable as a deduction for medical care under Section 213 of the Code (determined without regard to whether the taxpayer itemizes deductions);

•	A distribution that is made to an alternate payee pursuant to a qualified domestic relations order (that meets the conditions of Section 414(p) of the Code) (not applicable to IRA Contracts);

•

Distributions from an IRA Contract for the purchase of medical insurance (as described in Section 213(d)(1)(D) of the Code) for the taxpayer and his or her spouse and dependents if the taxpayer has received unemployment compensation for at least 12 weeks (this exception will no longer apply after the taxpayer has been re-employed for at least 60 calendar days);

•	Distributions from an IRA Contract made to the taxpayer to the extent such distributions do not exceed the qualified higher education expenses (as defined in Section 72(t)(7) of the Code) of the taxpayer for the taxable year; and

•	Distributions from an IRA Contract made to the taxpayer which are qualified first-time home buyer distributions (as defined in Section 72(t)(8) of the Code).

•	A Distribution that is converted directly to a Roth IRA.

Required Distributions. A Qualified Plan or IRA Contract (other than a Roth IRA) must meet certain rules concerning required distributions that are set forth in the Code. Such rules are summarized below:

•	For Qualified Plans, required distributions generally must start by April 1 of the calendar year following the later of the calendar year in which the taxpayer reaches age 70½ or the calendar year in which the taxpayer retires;

•	For IRA Contracts (other than a Roth IRA), required distributions generally must start by April 1 of the calendar year following the calendar year in which the taxpayer reaches age 70½; and

•	When distributions are required under the Code, a certain minimum amount, determined under the Code, must be distributed each year.

In addition, other rules apply under the Code to determine when and how required minimum distributions must be made in the event of the taxpayer’s death. The applicable plan documents will contain such rules.

Income Tax Withholding

All distributions or the portion thereof which is includible in the gross income of the participant are subject to federal income tax. Generally, amounts are withheld from periodic payments at the rate of 10% from non-periodic payments. However, the participant, in most cases, may elect not to have taxes withheld or to have withholding done at a different rate.

Certain distributions from Qualified Plans which are not directly rolled over to another eligible retirement plan or individual retirement account or individual retirement annuity are subject to a mandatory 20% withholding for federal income tax. The 20% withholding requirement generally does not apply to: (a) a series of substantially equal payments made at least annually for the life or life expectancy of the participant or joint and last survivor expectancy of the participant and a designated beneficiary, or for a specified period of 10 years or more; (b) distributions which are required minimum distributions; (c) distributions made upon hardship of the employee; or (d) the portion of the distributions not includible in gross income (i.e., returns of after-tax contributions). Participants should consult their own tax counsel or other tax adviser regarding withholding requirements.

Withdrawal Limitations

The Code limits the withdrawal of purchase payments made by owners from certain tax-deferred annuities and 401(k) Plans. Withdrawals from these types of plans can only be made when an owner:

•	reaches age 59½;

•	leaves his/her job;

•

dies; or

•	becomes disabled (as that term is defined in the Code).

A withdrawal may also be made in the case of hardship if allowed by the plan; however, the owner can only withdraw purchase payments and not any earnings. Beginning in 2019, hardship distribution can be made from employer contributions as well as earning on contributions. Additionally, a withdrawal may be made in situations to which Section 72(t)(2)(G) of the Code applies (regarding individuals called to active duty).

Diversification

The Code provides that the underlying investments for a variable annuity must satisfy certain diversification requirements in order to be treated as an annuity contract. We believe that all of the portfolios are being managed in such a way that they comply with the requirements.

Neither the Code nor the Treasury Regulations issued to date provide guidance as to the circumstances under which you, because of the degree of control you exercise over the underlying investments, and not American Fidelity Assurance Company, would be considered the owner of the shares of the portfolios. If you are considered the owner of the portfolios’ shares, it will result in the loss of the favorable tax treatment for the policy. It is unknown to what extent under federal tax law owners are permitted to select portfolios, to make transfers among the portfolios or the number and type of portfolios for which owners may select. If any guidance is provided which is considered a new position, then the guidance would generally be applied prospectively. However, if such guidance is a position which is not new, it may be applied retroactively and you, as the owner of the policy, could be treated as the owner of the portfolios. See the additional discussion of this issue in the Statement of Additional Information.

Due to the uncertainty in this area, we reserve the right to modify the policy in an attempt to maintain favorable tax treatment.

OTHER INFORMATION

American Fidelity Assurance Company

American Fidelity Assurance Company is an Oklahoma stock life insurance company incorporated under the laws of the State of Oklahoma in 1960. Its principal executive offices are located at 9000 Cameron Parkway, Oklahoma City, Oklahoma 73114, telephone number 1.800.662.1113. American Fidelity Assurance Company is licensed to conduct life, annuity and accident and health insurance business in 49 states, the District of Columbia, Guam and American Samoa.

American Fidelity Assurance Company has been a wholly-owned subsidiary of American Fidelity Corporation since 1974. The stock of American Fidelity Corporation is controlled by a family investment partnership, Cameron Enterprises A Limited Partnership. William M. Cameron and Lynda L. Cameron each own 50% of the common stock of Cameron Associates, Inc., the sole general partner of Cameron Enterprises A Limited Partnership. The address of both American Fidelity Corporation and Cameron Enterprises A Limited Partnership, is 9000 Cameron Parkway, Oklahoma City, Oklahoma 73114.

Separate Account A

American Fidelity Assurance Company’s board of directors adopted a resolution on May 7, 1968 to establish Separate Account A as a separate account under Oklahoma insurance law. The inception date of Separate Account A was January 1, 1970 under the name American Fidelity Variable Annuity Fund A. It was organized as an open-end diversified management investment company with its own portfolio of securities. On January 1, 1999, Separate Account A became a unit investment trust. Separate Account A is registered with the SEC as a unit investment trust under the Investment Company Act of 1940.

The assets of Separate Account A are held in American Fidelity Assurance Company’s name on behalf of Separate Account A and legally belong to American Fidelity Assurance Company. Under Oklahoma law, however, the assets of Separate Account A may not be charged with liabilities arising out of any other business activities of American Fidelity Assurance Company. All income, gains and losses, realized or unrealized, are credited to or charged against Separate Account A contracts without regard to other income, gains and losses of American Fidelity Assurance Company. American Fidelity Assurance Company is obligated to pay all benefits and make all payments under the AFPR1ME GROWTH™ Variable Annuity.

Vanguard® VIF Total Stock Market Index Portfolio

Separate Account A invests exclusively in the Vanguard® VIF Total Stock Market Index Portfolio, which seeks to track the performance of a benchmark index that measures the investment return of the overall stock market. The investment advisor of the Vanguard® VIF Total Stock Market Index Portfolio is The Vanguard Group, Inc.

More information about the Vanguard® VIF Total Stock Market Index Portfolio can be found in the Vanguard Summary Prospectus. You may obtain a full prospectus, statement of additional information and other information about the Vanguard® VIF Total Stock Market Index Portfolio free of charge by contacting our Annuity Services Department. Call us at 1.800.662.1113 or write to us at P.O. Box 25520, Oklahoma City, Oklahoma 73125-0520 or e-mail us at va.help@americanfidelity.com. You should read the Vanguard Summary Prospectus carefully before investing.

Underwriter

American Fidelity Securities, Inc., a wholly-owned subsidiary of American Fidelity Assurance Company, is the principal underwriter for the annuity policies and acts as the distributor of the policies. The principal business address of American Fidelity Securities, Inc. is 9000 Cameron Parkway, Oklahoma City, Oklahoma 73114.

LEGAL PROCEEDINGS

There are no material pending legal proceedings affecting Separate Account A, American Fidelity Assurance Company or American Fidelity Securities, Inc.

FINANCIAL STATEMENTS

The financial statements of American Fidelity Separate Account A and of American Fidelity Assurance Company are included in the Statement of Additional Information.

TABLE OF CONTENTS OF
STATEMENT OF ADDITIONAL INFORMATION

Page

General Information and History	1
Annuity Payments	1
Federal Tax Status	2
Offering of the AFPR1ME GROWTH™ Variable Annuity	3
Financial Statements	4

PLACE STAMP HERE

________________________

American Fidelity Assurance Company

P.O. Box 25520

Oklahoma City, OK 73125-0520

Attention: Annuity Services Department

Please send me the Statement of Additional Information for the following:

□ AFPR1ME GROWTH™ Variable Annuity

□ Vanguard® VIF Total Stock Market Index Portfolio

Nam ________________________________________________________________

(please print)

Address ________________________________________________________________

________________________________________________________________

AFPR1ME GROWTH^™Variable Annuity

issued by

American Fidelity Separate Account A

and

American Fidelity Assurance Company

STATEMENT OF ADDITIONAL INFORMATION

May 1, 2019

This Statement of Additional Information is not a prospectus. You should read this document in conjunction with the Prospectus dated May 1, 2019 relating to the AFPR1ME GROWTH™ Variable Annuity.

The Prospectus sets forth information that a prospective investor should know before investing. For a copy of the Prospectus,

write to us at:	call us at:	e-mail us at:
P.O. Box 25520	1.800.662.1113	va.help@americanfidelity.com
Oklahoma City, Oklahoma 73125-0520

AFPR1ME GROWTH^™Variable Annuity

issued by

American Fidelity Separate Account A

and

American Fidelity Assurance Company

STATEMENT OF ADDITIONAL INFORMATION

May 1, 2019

TABLE OF CONTENTS

Page

General Information and History	1
Annuity Payments	1
Federal Tax Status	2
Offering of the AFPR1ME GROWTH™ Variable Annuity	3
Financial Statements	4

GENERAL INFORMATION AND HISTORY

American Fidelity Separate Account A is offering the AFPR1ME GROWTH™ Variable Annuity to (1) employers for use in qualified retirement plans and (2) individuals using the contract to fund an Individual Retirement Annuity. The depositor, American Fidelity Assurance Company, was organized in Oklahoma in 1960 and is a wholly owned subsidiary of American Fidelity Corporation, a Nevada insurance holding company. The stock of American Fidelity Corporation is controlled by a family investment partnership, Cameron Enterprises A Limited Partnership, an Oklahoma limited partnership. William M. Cameron and Lynda L. Cameron, each own 50% of the common stock of Cameron Associates, Inc., the sole general partner of Cameron Enterprises A Limited Partnership.

ANNUITY PAYMENTS

Upon investing in the AFPR1ME GROWTH™ Variable Annuity, you will select an annuity date, which is the month and year that you will begin receiving regular monthly income payments from the annuity. Annuity payments may be made on a variable basis and/or a fixed basis.

Fixed Annuity Payments

The dollar amount of each fixed annuity payment will be at least as great as that determined in accordance with the 4% annuity table in the contract. The fixed annuity provides a 4% annual guaranteed interest rate on all annuity options. American Fidelity Assurance Company may pay or credit excess interest on a fixed annuity at its discretion.

Variable Annuity Payments

A participant may elect a variable annuity payout. Variable annuity payments reflect the investment performance of the Vanguard® VIF Total Stock Market Index Portfolio during the annuity period. Variable annuity payments are not guaranteed as to dollar amounts.

American Fidelity Assurance Company will determine the first annuity payment by using the 4.5% annuity table in the contract. It shows the dollar amount of the first monthly payment which can be purchased with each $1,000 of value in a participant account after deducting any applicable premium taxes.

The value of a participant account is determined by multiplying the participant’s accumulation units by the accumulation unit value on the fourteenth calendar day before the first annuity payment. The first annuity payment varies according to the annuity option selected and the participant’s age.

American Fidelity Assurance Company will determine the number of annuity units payable for each payment by dividing the dollar amount of the first annuity payment by the annuity unit value on the annuity date. This sets the number of annuity units. The number of annuity units payable remains the same unless a participant transfers a portion of the annuity benefit to a fixed annuity. The dollar amount is not fixed and will change from month to month.

The dollar amount of annuity payments after the first payment is determined by multiplying the fixed number of annuity units per payment by the annuity unit value on the fourteenth calendar day preceding the payment date. The result is the dollar amount of the payment.

Annuity Unit

The value of an annuity unit is determined by multiplying the value of an annuity unit for the immediately preceding period by the product of (1) the net investment factor for the fourteenth calendar day prior to the valuation date for which the value is being determined, and (2) 0.9998794.

Variable Annuity Formulas

The following formulas summarize the annuity payment calculations described above:

Number of Variable Annuity Units = Dollar Amount of First Monthly Payment

Variable Annuity Unit Value on Date of First Payment

Value of Annuity Net Investment Factor

Annuity Unit Value = Unit on Preceding X 0.9998794 X for 14th Day Preceding

Valuation Date Current Valuation Date

Dollar Amount Number of Annuity Unit Value

of Second and = Annuity Units X for Period in Which

Subsequent Annuity Per Payment Payment is Due

Payments

FEDERAL TAX STATUS

NOTE: The following is a description of federal income tax law applicable to annuities in general. You should seek competent tax advice regarding the matters discussed in the Prospectus and this Statement of Additional Information. American Fidelity Assurance Company does not guarantee the tax status of the policies. You bear the complete risk that the policies may not be treated as “annuity contracts” under federal income tax laws. It should be further understood that the following discussion is not exhaustive and that special rules not described herein may be applicable in certain situations. Moreover, no attempt has been made to consider any applicable state or other tax laws.

General

American Fidelity Assurance Company is taxed as a life insurance company under the Internal Revenue Code (the “Code”). For federal income tax purposes, Separate Account A is not a separate entity from American Fidelity Assurance Company and its operations form a part of American Fidelity Assurance Company.

Diversification

Section 817(h) of the Code imposes certain diversification standards on the underlying assets of variable annuity contracts. The Code provides that a variable annuity contract will not be treated as an annuity contract for any period (and any subsequent period) for which the investments are not adequately diversified in accordance with regulations prescribed by the United States Treasury Department (the “Treasury Department”). Disqualification of the policy as an annuity contract would result in imposition of federal income tax to you with respect to earnings allocable to the policy prior to the receipt of payments under the policy. The Code contains a safe harbor provision which provides that annuity contracts such as the policies meet the diversification requirements if, as of the end of each quarter, the underlying assets meet the diversification standards for a regulated investment company and no more than fifty-five percent (55%) of the total assets consist of cash, cash items, U.S. government securities, and securities of other regulated investment companies.

The Treasury Department has issued regulations (including Treas. Reg. § 1.817-5) which establish diversification requirements for the investment portfolios underlying variable contracts such as the policies. The regulations amplify the diversification requirements for variable contracts set forth in the Code and provide an alternative to the safe harbor provision described above. Under the regulations, an investment portfolio will be deemed adequately diversified if: (1) no more than 55% of the value of the total assets of the portfolio is represented by any one investment; (2) no more than 70% of the value of the total assets of the portfolio is represented by any two investments; (3) no more than 80% of the value of the total assets of the portfolio is represented by any three investments; and (4) no more than 90% of the value of the total assets of the portfolio is represented by any four investments.

American Fidelity Assurance Company intends that all funds underlying the policies will be managed by the investment advisors in such a manner as to comply with these diversification requirements.

The diversification regulations issued by the Treasury Department do not provide guidance regarding the circumstances in which owner control of the investments of Separate Account A will cause the owner to be treated as the owner of the assets of Separate Account A, thereby resulting in the loss of favorable tax treatment for the policy. At this time it cannot be determined whether additional guidance will be provided and what standards may be contained in such guidance.

The amount of owner control which may be exercised under the policy is different in some respects from the situations addressed in published rulings issued by the Internal Revenue Service in which it was held that the policy owner was not the owner of the assets of the separate account. It is unknown whether these differences, such as the owner’s ability to transfer among investment choices or the number and type of investment choices available, would cause the owner to be considered as the owner of the assets of Separate Account A resulting in the imposition of federal income tax to the owner with respect to earnings allocable to the policy prior to receipt of payments under the policy.

In the event any forthcoming guidance or ruling is considered to set forth a new position, such guidance or ruling will generally be applied only prospectively. However, if such ruling or guidance was not considered to set forth a new position, it may be applied retroactively resulting in the owner being retroactively determined to be the owner of the assets of Separate Account A.

Due to the uncertainty in this area, American Fidelity Assurance Company reserves the right to modify the policy in an attempt to maintain favorable tax treatment.

OFFERING OF THE AFPR1ME GROWTH™ VARIABLE ANNUITY

American Fidelity Separate Account A offers the AFPR1ME GROWTH™ Variable Annuity to (1) employers for use in qualified retirement plans and (2) individuals using the contract to fund an Individual Retirement Account. The AFPR1ME GROWTH™ Variable Annuity is issued by American Fidelity Assurance Company in the form of group contracts between American Fidelity Assurance Company and the employer or an individual using the contract to fund an Individual Retirement Annuity.

Underwriter

American Fidelity Securities, Inc., a wholly owned subsidiary of American Fidelity Assurance Company, is the principal underwriter for the annuity policies and acts as the distributor of the policies. The policies are offered on a continuous basis. The aggregate underwriting commissions paid to and retained by American Fidelity Securities in connection with Separate Account A for 2018, 2017 and 2016 were $65,457, $71,966 and $79,476 respectively.

Custodian and Independent Registered Public Accounting Firm

The name and address of the person who maintains physical possession of the accounts, books and other documents of American Fidelity Separate Account A required by Section 31(a) of the Investment Company Act of 1940 is Jeanette Rice, President and Chief Operations Officer of American Fidelity Assurance Company, 9000 Cameron Parkway, Oklahoma City, Oklahoma 73114.

The financial statements of American Fidelity Separate Account A and the financial statements and schedules of American Fidelity Assurance Company included in this Statement of Additional Information have been audited by KPMG LLP, Independent Registered Public Accounting Firm, as stated in its reports appearing herein. KPMG LLP’s address is 210 Park Avenue, Suite 2650, Oklahoma City, Oklahoma 73102.

Investment Consultant

InvesTrust Consulting, LLC, 5100 N. Classen Blvd., Suite 600, Oklahoma City, Oklahoma 73118, acts as an investment consultant for the registrant and American Fidelity Assurance Company. Under the investment consultant agreement, from time to time, InvesTrust Consulting, LLC provides certain reports and information to Separate Account A and American Fidelity Assurance Company. InvesTrust Consulting, LLC is an indirect subsidiary of American Fidelity Corporation, which owns 100% of American Fidelity Assurance Company.

American Fidelity Assurance Company, the separate account’s depositor, pays any compensation payable to InvesTrust Consulting, LLC for services provided to Separate Account A. InvesTrust Consulting received $61,388, $56,418 and $51,542 for services provided to Separate Account A in 2018, 2017 and 2016, respectively.

Legal Opinion

McAfee & Taft A Professional Corporation has provided advice on certain matters relating to the federal securities and income tax laws applicable to the contracts.

FINANCIAL STATEMENTS

The following are the financial statements of American Fidelity Separate Account A and the financial statements and schedules of American Fidelity Assurance Company. The financial statements of American Fidelity Assurance Company should be considered only as bearing on the ability of American Fidelity Assurance Company to meet its obligations under the contracts; they should not be considered as bearing on the investment performance of the assets held in Separate Account A.

AMERICAN FIDELITY SEPARATE ACCOUNT A

Financial Statements

December 31, 2018

(With Report of Independent Registered Public Accounting Firm Thereon)

Report of Independent Registered Public Accounting Firm

To the Board of Directors
American Fidelity Assurance Company and

Contract Owners
American Fidelity Separate Account A:

Opinion on the Financial Statements

We have audited the accompanying statement of assets and liabilities of American Fidelity Separate Account A (Account A), as of December 31, 2018, the related statement of operations for the year then ended, the statements of changes in net assets for each of the years in the two‑year period then ended, and the related notes (collectively, the financial statements) and the financial highlights for each of the years in the five‑year period then ended. In our opinion, the financial statements and financial highlights present fairly, in all material respects, the financial position of American Fidelity Separate Account A as of December 31, 2018, the results of its operations for the year then ended, the changes in its net assets for each of the years in the two‑year period then ended, and the financial highlights for each of the years in the five‑year period then ended, in conformity with U.S. generally accepted accounting principles.

Basis for Opinion

These financial statements and financial highlights are the responsibility of Account A’s management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to Account A in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements and financial highlights, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements and financial highlights. Such procedures also included confirmation of securities owned as of December 31, 2018, by correspondence with the underlying mutual fund. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and financial highlights. We believe that our audits provide a reasonable basis for our opinion.

/s/KPMG LLP

We have served as the auditor of one or more American Fidelity Separate Accounts since 1990.

Oklahoma City, Oklahoma
February 27, 2019

AMERICAN FIDELITY SEPARATE ACCOUNT A
Statement of Assets and Liabilities
December 31, 2018
Investments at fair value:
	Vanguard Total Stock Market Index Fund (5,177,366 shares at net asset value of
		$34.26 per share) (cost $173,758,506)		$	177,376,549
	Subscription receivable				14,791
	Receivable for pending investment transactions				20,941
			Total assets		177,412,281

	Payable due to related party				13,875
	Redemption Payable				21,857
			Total liabilities		35,732

			Net assets	$	177,376,549
Accumulation units outstanding					3,254,172
Accumulation unit value				$	54.507
See accompanying notes to financial statements.

AMERICAN FIDELITY SEPARATE ACCOUNT A
Statement of Operations
Year ended December 31, 2018
Net investment income:
	Investment income distributions from underlying mutual fund		$	3,159,720
	Mortality and expense fees			(1,952,209)
		Net investment income		1,207,511
Realized gains/losses on investments:
	Realized gains distributions from underlying mutual fund			8,077,884
	Proceeds from sales			17,172,802
	Cost of investments sold			15,153,325
		Net realized gain on investments sold		2,019,477
		Net realized gain on investments		10,097,361

Unrealized appreciation on investments, end of year				3,618,043
Unrealized appreciation on investments, beginning of year				26,185,724
		Change in unrealized appreciation		(22,567,681)
		Net decrease in net assets from operations	$	(11,262,809)

See accompanying notes to financial statements.

AMERICAN FIDELITY SEPARATE ACCOUNT A
Statements of Changes in Net Assets
Years ended December 31, 2018 and 2017
				2018	2017
Increase in net assets from operations:
	Net investment income		$	1,207,511	1,804,187
	Net realized gain on investments			10,097,361	10,652,554
	Unrealized appreciation (depreciation) during the year			(22,567,681)	22,161,375
		Net increase (decrease) in net assets from operations		(11,262,809)	34,618,116
Changes from contract transactions				(14,925,771)	(11,216,983)
		Increase (decrease) in net assets		(26,188,580)	23,401,133
Net assets, beginning of year				203,565,129	180,163,996
Net assets, end of year			$	177,376,549	203,565,129
See accompanying notes to financial statements.

AMERICAN FIDELITY SEPARATE ACCOUNT A
Financial Highlights
Five-year period ended December 31
				2018	2017	2016	2015	2014
Net assets			$	177,376,549	203,565,129	180,163,996	170,803,266	182,610,112
Accumulation unit value				54.507	58.137	48.523	43.526	43.784
Number of accumulation units outstanding				3,254,172	3,501,499	3,712,964	3,924,171	4,170,681
Investment income as a percent of average net assets ⁽¹⁾				1.56%	1.90%	1.48%	1.36%	12.18%
Expenses as a percent of average net assets ⁽²⁾				0.96	0.96	0.96	0.96	0.96
Total return ⁽³⁾				(6.24)	19.81	11.48	(0.59)	10.15
⁽¹⁾	This ratio represents the dividend, excluding distributions of capital gains, received by the underlying mutual fund divided by the average net assets.
⁽²⁾	This ratio represents the annualized contract expenses of the separate account, consisting primarily of mortality and expense charges and administrative
		charges. The ratio includes only those expenses that result in a direct reduction to unit values. Charges made directly to contract owner accounts
		through the redemption of units and expenses of the underlying fund are excluded.
⁽³⁾	The total return for the period indicated, including changes in the value of the underlying fund, reflects deductions for all items included in the
		expense ratio. The total return does not include any expenses assessed through the redemption for units. Inclusion of these expenses in the
		calculation would result in a reduction in the total return presented.
See accompanying notes to financial statements.

AMERICAN FIDELITY SEPARATE ACCOUNT A

Notes to Financial Statements

December 31, 2018

(1)	Summary of Significant Accounting Policies

(a)

General

American Fidelity Separate Account A (Account A) is a separate account of American Fidelity Assurance Company (AFA) and is registered as a unit investment trust under the Investment Company Act of 1940, as amended. Account A was formerly known as American Fidelity Variable Annuity Fund A and operated as an open‑end diversified management investment company from 1968 to December 31, 1998. Effective January 1, 1999, it was converted to a unit investment trust separate account. Account A is an investment company and applies the specialized accounting and reporting guidance in ASC Topic946 Financial Services – Investment Companies.

The assets of Account A are held for the exclusive benefit of the variable annuity contract owners and are not chargeable with liabilities arising out of the business conducted by AFA.

(b)	Investments

Account A’s investment objectives are primarily long‑term growth of capital and secondarily the production of income. On November 26, 2014, investment in the American Fidelity Dual Strategy Fund was substituted with the Vanguard Total Stock Market Index Fund (the Fund). Investments in shares of the Fund are stated at fair value, which is the net asset value per share as determined daily by the Fund. Transactions are recorded on a trade‑date basis by the Fund. Income from dividends and gains from realized gain distributions are recorded on the ex-distribution date.

Realized gains and losses from investment transactions and unrealized appreciation or depreciation of investments are determined on the average cost basis.

Account A groups its financial assets measured at fair value in three levels, based on inputs and assumptions used to determine the fair value. These levels are as follows:

·	Level 1 – quoted prices in active markets for identical securities.

·	Level 2 – other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.).

·	Level 3 – significant unobservable inputs (including Account A’s own assumptions used to determine the fair value of investments).

There were no transfers of securities from Level 1 to Level 2 or vice versa throughout the year.

(Continued)

AMERICAN FIDELITY SEPARATE ACCOUNT A

Notes to Financial Statements

December 31, 2018

The inputs or methodologies used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. The following table summarizes the inputs used to value Account A’s net assets as of December 31, 2018:

Level 1 – Quoted prices			$	177,376,549
Level 2 – Other significant
	observable inputs			—
Level 3 – Significant unobservable
	inputs			—
		Total	$	177,376,549

(c)	Income Taxes

Account A is not taxed separately because the operations of Account A are part of the total operations of AFA. AFA files its federal income tax returns, under sections of the Internal Revenue Code (the Code) applicable to life insurance companies, as part of the American Fidelity Corporation and Subsidiaries consolidated federal income tax returns. Account A is not taxed as a “regulated investment company” under subchapter M of the Code. Based on this, no charge is being made currently to Account A for federal income taxes. AFA will review periodically the status of this policy in the event of changes in the tax law. A charge may be made in future years for any federal income taxes that would be attributable to the contracts.

The Tax Cuts and Jobs Act of 2017 was enacted on December 22, 2017 and does not impact Account A’s tax reporting required by Financial Standards Board (FASB), Accounting Standards Codification (ASC) 740, Income Taxes.

Account A recognizes and measures unrecognized tax positions in accordance with FASB ASC 740. Account A has no unrecognized tax positions at December 31, 2018.

As of December 31, 2018, Account A has no accrued interest and penalties related to unrecognized tax positions. Account A would recognize interest accrued related to unrecognized tax positions in interest expense and penalties accrued in operating expense, should they occur.

The tax years 2015 through 2018 remain open to examination by the major taxing jurisdictions to which Account A is subject. Account A, as part of AFA, is not currently under examination by any taxing authority and does not expect any material changes to its unrecognized tax positions within the next twelve months.

(Continued)

AMERICAN FIDELITY SEPARATE ACCOUNT A

Notes to Financial Statements

December 31, 2018

(d)	Annuity Reserves

Annuity reserves are computed for currently payable contracts according to the Progressive Annuity Mortality Table. The assumed interest rate is 3.5% unless the annuitant elects otherwise, in which case the rate may vary from 0% to 5.0% as regulated by the laws of the respective states. Charges to annuity reserves for mortality and expense risks experience are reimbursed to AFA if the reserves required are less than originally estimated.

If additional reserves are required, AFA reimburses Account A. At December 31, 2018, there were no contract owners who had elected the variable annuity method of payout. Accordingly, Account A held no annuity reserves at December 31, 2018.

(e)	Use of Estimates

The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of increase and decrease in net assets from operations during the reporting period. Actual results could differ from those estimates.

(2)	Variable Annuity Contracts

AFA manages the operations of Account A and assumes certain mortality and expense risks under the variable annuity contracts. Mortality and expense fees are equal to 0.0026308% of Account A’s daily net assets (0.96025% per annum). All such fees were paid to AFA.

Net purchase payments received represent gross payments less deductions of $98,584 and $105,823 for the years ended December 31, 2018 and 2017, respectively. The deductions comprise sales charges (3% of purchase payments), administrative fees (0.25% of purchase payments), minimum death benefits (0.75% of purchase payments), per payment charges ($0.50 per payment), and certificate issuance fees ($15.00 per certificate). These deductions were paid to AFA.

During the accumulation period, contract owners may partially or totally withdraw from Account A by surrendering a portion or all of their accumulation units. The Code may limit certain withdrawals based upon age, disability, and other factors. When contract owners withdraw, they receive the current value of their accumulation units. There are no fees assessed through the redemption of units.

(Continued)

AMERICAN FIDELITY SEPARATE ACCOUNT A

Notes to Financial Statements

December 31, 2018

(3)	Unit Activity from Contract Transactions

Contract transactions for the years ended December 31, 2018 and 2017 were as follows:

			Units			Amount
			2018	2017		2018	2017
Payments received			45,493	48,712	$	2,728,428	2,579,012
Withdrawal of funds			(292,820)	(260,177)		(17,654,199)	(13,795,995)
	Net change from
		contract
		transactions	(247,327)	(211,465)	$	(14,925,771)	(11,216,983)

(4)	Subsequent Events

Account A has evaluated subsequent events requiring adjustments or disclosure in the financial statements through February 27, 2019, the date the financial statements were issued.

AMERICAN FIDELITY ASSURANCE COMPANY

Statutory Financial Statements and Schedules

December 31, 2018 and 2017

(With Independent Auditors’ Report Thereon)

Independent Auditors’ Report

The Board of Directors
American Fidelity Assurance Company:

We have audited the accompanying statutory financial statements of American Fidelity Assurance Company (the Company), which comprise the statutory statements of admitted assets, liabilities, and capital and surplus as of December 31, 2018 and 2017, and the related statutory statements of operations, capital and surplus, and cash flow in the three-year period ended December 31, 2018, and the related notes to the statutory financial statements.

Management’s Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements in accordance with statutory accounting practices prescribed or permitted by the Oklahoma Insurance Department. Management is also responsible for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

Auditors’ Responsibility

Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors’ judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.

Basis for Adverse Opinion on U.S. Generally Accepted Accounting Principles

As described in Note 1 to the financial statements, the financial statements are prepared by the Company using statutory accounting practices prescribed or permitted by the Oklahoma Insurance Department, which is a basis of accounting other than U.S. generally accepted accounting principles. Accordingly, the financial statements are not intended to be presented in accordance with U.S. generally accepted accounting principles.

The effects on the financial statements of the variances between the statutory accounting practices and U.S. generally accepted accounting principles also are described in Note 19.

Adverse Opinion on U.S. Generally Accepted Accounting Principles

In our opinion, because of the significance of the variances between statutory accounting practices and U.S. generally accepted accounting principles discussed in the Basis for Adverse Opinion on U.S. Generally Accepted Accounting Principles paragraph, the financial statements referred to above do not present fairly, in accordance with U.S. generally accepted accounting principles, the financial position of American Fidelity Assurance Company as of December 31, 2018 and 2017, or the results of its operations or its cash flows for each the years in the three-year period ended December 31, 2018.

Opinion on Statutory Basis of Accounting

In our opinion, the financial statements referred to above present fairly, in all material respects, the admitted assets, liabilities, and capital and surplus of American Fidelity Assurance Company as of December 31, 2018 and 2017, and the results of its operations and its cash flow for the years in the three-year period ended December 31, 2018, in accordance with statutory accounting practices prescribed or permitted by the Oklahoma Insurance Department described in Note 1.

Other Matter

Our audits were conducted for the purpose of forming an opinion on the financial statements as a whole. The supplementary information included in the Schedule I – Summary of Investments – Other than Investments in Related Parties, Schedule III – Supplementary Insurance Information, and Schedule IV – Reinsurance, is presented for purposes of additional analysis and is not a required part of the financial statements but is supplementary information required by Regulation S-X Rule 7-05 of the Securities and Exchange Commission. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the financial statements. The information has been subjected to the auditing procedures applied in the audits of the financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the financial statements or to the financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated in all material respects in relation to the financial statements as a whole.

/s/KPMG LLP

Oklahoma City, Oklahoma
April 19, 2019

AMERICAN FIDELITY ASSURANCE COMPANY

Statutory Statements of Admitted Assets,

Liabilities, and Capital and Surplus

December 31, 2018 and 2017

Admitted Assets					2018	2017
Cash and invested assets:
	Bonds, at amortized cost (fair value: $4,105,274,207 and
		$4,259,537,835 at December 31, 2018 and 2017, respectively)		$	4,115,251,600	4,043,435,952
	Preferred stocks, at cost (fair value: $4,628,588 and
		$5,162,340 at December 31, 2018 and 2017, respectively)			4,211,220	4,211,220
	Common stocks, at fair value (cost: $12,581,365 and
		$13,382,865 at December 31, 2018 and 2017, respectively)			23,322,478	23,252,191
	Common stock, investment in affiliates at equity value				1,139,211	962,932
	Mortgage loans on real estate				484,256,052	480,274,494
	Investment real estate, at cost (less accumulated depreciation of
		$9,186,852 and $8,457,362 at December 31, 2018 and 2017, respectively, and less encumbrances of $31,480,666 and
		$32,803,503 at December 31, 2018 and 2017, respectively)			24,071,571	20,496,168
	Policy loans				56,675,209	55,266,258
	Cash and short-term investments, at cost, which approximates fair value				336,915,573	241,831,403
	Other invested assets				40,278,452	23,105,556
			Total cash and invested assets		5,086,121,366	4,892,836,174
Life insurance premiums and annuity considerations deferred
	and uncollected				38,320,816	38,791,158
Accident and health premiums due and unpaid					54,160,453	51,829,866
Investment income due and accrued					40,490,632	40,109,898
Amounts recoverable from reinsurers					3,162,472	1,275,751
Other receivables under reinsurance contracts					8,271,235	11,558,586
Equipment, at cost (less accumulated depreciation of $528,271 and
	$313,482 at December 31, 2018 and 2017, respectively)				116,824	336,914
Deferred tax assets					28,072,095	24,838,194
Other assets					87,687,289	53,368,892
Separate Accounts’ assets					754,806,790	781,742,340
			Total admitted assets	$	6,101,209,972	5,896,687,773

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Statutory Statements of Admitted Assets,

Liabilities, and Capital and Surplus

December 31, 2018 and 2017

Liabilities and Capital and Surplus					2018	2017
Aggregate reserves:
	Life policies and contracts			$	2,414,343,414	2,328,051,699
	Accident and health policies				709,006,176	661,508,564
			Total aggregate reserves		3,123,349,590	2,989,560,263
Policy and contract claims reserves					116,179,693	106,663,883
Liability for premiums and other deposit funds					336,082	8,925,655
Remittances and items not allocated					21,444,809	19,868,845
General insurance expenses, taxes, licenses, and fees
	due or accrued				104,023,684	83,886,053
Funds held under coinsurance					706,187,716	724,753,162
Other liabilities					271,986,543	252,992,978
Borrowed money					497,669,116	497,670,254
Separate Accounts’ liabilities					754,806,790	781,742,340
			Total liabilities		5,595,984,023	5,466,063,433
Capital and surplus:
	Common stock, par value $10 per share, 250,000 shares
		authorized, issued, and outstanding			2,500,000	2,500,000
	Additional paid-in capital				5,887,698	5,887,698
	Unassigned surplus				496,838,251	422,236,642
			Total capital and surplus		505,225,949	430,624,340
Commitments and contingencies
			Total liabilities and capital and surplus	$	6,101,209,972	5,896,687,773
See accompanying notes to statutory financial statements.

GG AMERICAN FIDELITY ASSURANCE COMPANY

Statutory Statements of Operations

Years ended December 31, 2018, 2017 and 2016

					2018	2017	2016
Income:
	Life insurance premiums and annuity considerations			$	352,337,715	277,014,197	269,132,871
	Accident and health insurance premiums				739,319,233	680,365,036	637,451,328
	Net investment income (less investment expenses of $33,696,562,
		$33,617,790, and $32,288,799 in 2018, 2017, and 2016, respectively)			184,959,903	178,067,273	175,492,628
	Commissions and expense allowances on reinsurance ceded				(5,957,867)	(9,320,885)	(11,980,402)
	Other income				56,076,296	48,092,873	44,734,212
			Total income		1,326,735,280	1,174,218,494	1,114,830,637
Benefits and other deductions:
	Death benefits and matured endowments				29,675,601	25,688,445	27,772,465
	Annuity benefits				59,117,815	8,606,590	9,017,760
	Accident and health and disability benefits				368,901,423	319,679,930	279,479,902
	Interest and adjustments on policy or deposit-type contract funds				383,344	413,696	315,282
	Other benefits to policyholders and beneficiaries				131,961,474	121,165,678	106,659,685
	Increase in aggregate reserves for future policy benefits				133,789,327	182,263,256	219,515,930
	Commissions on premiums and annuity considerations				145,679,305	132,173,398	120,283,886
	Commissions and expense allowances on reinsurance assumed				13,121,320	13,378,325	12,339,862
	General insurance expenses, taxes, licenses, and fees				316,679,535	261,853,121	231,436,106
	Other				27,463,979	6,765,911	1,129,201
			Total benefits and other deductions		1,226,773,123	1,071,988,350	1,007,950,079
			Net gain from operations before federal income taxes and
			net realized capital gains (losses)		99,962,157	102,230,144	106,880,558
Federal income taxes					7,521,969	31,554,611	32,030,414
			Net gain from operations before net realized capital gains (losses)		92,440,188	70,675,533	74,850,144
Net realized capital gains (losses), net of federal income tax expense (benefit)
	of ($9,142,363), $9,447,403, and $7,278,712 in 2018, 2017, and 2016,
	respectively (excluding gains (losses) of ($4,218,990), $16,242,903, and
	$12,699,868 transferred to the interest maintenance reserve in 2018, 2017,
	and 2016, respectively)				6,448,632	(4,477,008)	1,584,125
			Net income	$	98,888,820	66,198,525	76,434,269
See accompanying notes to statutory financial statements.

GG AMERICAN FIDELITY ASSURANCE COMPANY

Statutory Statements of Capital and Surplus

Years ended December 31, 2018, 2017, and 2016

				2018		2017		2016
Capital and surplus, beginning of year			$	430,624,340		414,602,457		408,497,516
Net income				98,888,820		66,198,525		76,434,269
Change in net unrealized capital gains, net of tax benefit
	(expense) of $40,364, $607,835, and ($258,915) for 2018, 2017, and 2016, respectively			8,814,035	2,203,033		431,579
Change in net deferred taxes				(3,533,775)	(32,231,203)		4,865,153
Change in nonadmitted assets				10,497,598	18,927,609		(19,814,729)
Change in asset valuation reserve				(4,822,912)	(2,673,790)		(6,297,898)
Dividends to stockholder				(35,000,000)	(35,000,000)		(45,000,000)
Change in liability for reinsurance in unauthorized companies				22,981	(1,252,401)		381,660
Correction of error, net of tax expense of $0, $0, and $2,528,052
	for 2018, 2017, and 2016, respectively (note 1)			—	—		(5,855,896)
Other changes				(265,138)	(149,890)		960,803
		Net change in capital and surplus		74,601,609	16,021,883		6,104,941
Capital and surplus, end of year			$	505,225,949	430,624,340		414,602,457
See accompanying notes to statutory financial statements.

GG AMERICAN FIDELITY ASSURANCE COMPANY

Statutory Statements of Cash Flow

Years ended December 31, 2018, 2017, and 2016

				2018	2017	2016
Premiums and annuity considerations, net of reinsurance			$	1,091,465,791	939,495,468	900,614,869
Allowances and reserve adjustments on reinsurance ceded				(5,957,867)	(9,320,885)	(11,980,402)
Investment income received				182,510,343	177,655,461	174,392,452
Other income				49,891,286	41,853,449	40,229,702
Life and accident and health claims paid				(390,836,382)	(355,803,263)	(336,633,908)
Surrender benefits and other fund withdrawals paid				(131,850,901)	(121,043,482)	(106,521,586)
Other benefits to policyholders paid				(83,588,529)	(8,728,786)	(9,155,859)
Commissions and other expenses paid				(454,077,905)	(408,083,202)	(365,788,138)
Federal income taxes paid				(9,602,014)	(35,368,482)	(41,065,332)
Dividends paid to policyholders				(884,406)	(795,603)	(488,797)
		Net cash from operations		247,069,416	219,860,675	243,603,001
Proceeds from investments sold, matured, or repaid:
	Bonds			492,427,928	739,805,969	763,901,133
	Stocks			1,553,668	1,549,846	2,514,516
	Mortgage loans			69,461,272	51,610,622	50,247,283
	Other			265,306	33,879,265	2,803,089
		Total investment proceeds		563,708,174	826,845,702	819,466,021
Cost of investments acquired:
	Bonds			(567,992,125)	(883,786,844)	(894,371,627)
	Stocks			—	(145,376)	—
	Mortgage loans			(73,442,830)	(89,283,592)	(99,568,000)
	Other			(18,175,686)	(33,469,917)	(1,940,513)
		Total investments acquired		(659,610,641)	(1,006,685,729)	(995,880,140)
Net change in policy loans and loans on fund deposits				(1,408,951)	(2,048,228)	(544,385)
		Net cash from investing		(97,311,418)	(181,888,255)	(176,958,504)
Borrowed money				—	—	(25,160,319)
Other cash provided				36,178,981	109,354,854	2,963,162
Dividends paid to stockholder				(35,000,000)	(35,000,000)	(45,000,000)
Other cash applied				(55,852,809)	(14,005,818)	(31,125,621)
		Net cash from financing and miscellaneous sources		(54,673,828)	60,349,036	(98,322,778)
		Net change in cash and short-term investments		95,084,170	98,321,456	(31,678,281)
Cash and short-term investments, beginning of year				241,831,403	143,509,947	175,188,228
Cash and short-term investments, end of year			$	336,915,573	241,831,403	143,509,947
See accompanying notes to statutory financial statements.

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

(1)	Significant Accounting Policies

(a)

Business

American Fidelity Assurance Company (AFA or the Company) provides a variety of financial services. AFA is a wholly owned subsidiary of American Fidelity Corporation (AFC), a Nevada insurance holding company. AFA is domiciled in the state of Oklahoma. The Company is subject to state insurance regulations and periodic examinations by state insurance departments.

AFA is licensed in 49 states, as well as the District of Columbia, American Samoa, Puerto Rico, and Guam, with approximately 39% of direct premiums written in Oklahoma, Texas, and California. Activities of AFA are largely concentrated in the group disability income, group and individual annuity, supplemental health, and individual medical markets. In addition, individual and group life business is also conducted. The main thrust of AFA’s sales is worksite marketing of voluntary products through the use of payroll deduction. The Company sells these voluntary products through a salaried sales force that is broken down into two primary divisions: the Association Worksite Division (AWD) and American Fidelity Educational Services (AFES). AWD specializes in voluntary disability income insurance programs aimed at selected groups and associations whose premiums are funded by employees through payroll deductions. AFES focuses on marketing to public school employees with voluntary insurance products such as disability income, tax‑sheltered annuities, life insurance, dread disease, and accident only. These premiums are also funded by employees through payroll deductions. The expertise gained by the Company in worksite marketing of voluntary products is used by the Strategic Alliances Division in developing products to meet special situations. The Life Division was formed upon the acquisition of a block of life business in 2000. This division is marketing individual life products through independent brokers in the United States of America and Latin America.

These statutory financial statements were prepared for the purpose of filing with the various state insurance departments.

In 2016, the Company discovered an error in the amounts recorded for group medical payables and receivables related to ceded insurance contracts. The majority of the cumulative amount was created by the application of incorrect contractual percentages on certain arrangements since 2007. The cumulative impact of this error was recorded in 2016 as an adjustment to the beginning of year surplus. The error had accumulated over the 9-year period, thus the misstatement in a single year was not material. The remainder of the cumulative amount resulted from incorrect postings of receivables dating back to 2000. Total impact of the error to 2016 beginning of period capital and surplus was approximately $5,900,000.

(b)	Basis of Presentation

The accompanying statutory financial statements of the Company have been prepared in conformity with accounting practices prescribed or permitted by the Oklahoma Insurance Department, which is a comprehensive basis of accounting other than U.S. generally accepted accounting principles (GAAP). Effective January 1, 2001, the National Association of Insurance Commissioners (NAIC) and the Oklahoma Insurance Department required that insurance companies domiciled in the state of Oklahoma prepare their statutory basis financial statements in accordance with the NAIC Accounting Practices and Procedures Manual Statements of Statutory Accounting Principles (SSAP) subject to any deviations prescribed or permitted by the Insurance Commissioner of the state of Oklahoma (the Commissioner). There are no differences between the accounting practices prescribed or permitted by the Oklahoma Insurance Department and the accounting practices prescribed and permitted by the NAIC. There have been no permitted practices granted to the Company for 2018, 2017, and 2016 by the Oklahoma Insurance Department.

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

SSAP differ from GAAP in several respects, which cause differences in reported assets, liabilities, stockholder’s equity (statutory capital and surplus), net income, and cash flows. The principal SSAP that differ from GAAP include the following:

·	The financial statements of subsidiaries are not consolidated and are accounted for as investments in common stock.

·	Investments in bonds and preferred stocks are carried amortized cost, cost, or the lower of cost or fair value; under GAAP, investments in bonds and preferred stock, other than those classified as held‑to‑maturity, are carried at fair value.

Certain assets (principally certain deferred taxes, furniture, equipment, prepaid expenses, and premiums due from policyholders, agents’ balances, and amounts recoverable from reinsurers over 90 days) have been designated as nonadmitted assets and excluded from assets by a charge to statutory surplus. Under GAAP, such amounts are carried at amortized cost with the appropriate valuation allowance, when necessary.

Aggregate reserves for life, annuities, and accident and health are based on statutory mortality and interest requirements without consideration for anticipated withdrawals except where allowed. Morbidity assumptions are based on the statutory morbidity requirements or Company’s experience where allowed. Under GAAP, the reserves are based on either (i) the present value of future benefits less the present value of future net premiums based on mortality, morbidity, and other assumptions that were appropriate at the time the policies were issued or acquired, or (ii) the account value for certain contracts without significant life contingencies.

·	The interest maintenance reserve (IMR) represents the deferral of interest‑related realized gains and losses, net of tax, on primarily fixed maturity investments, which are amortized into income over the remaining life of the investment sold. No such reserve is required under GAAP.

·	Deferred income taxes are recognized for both SSAP and GAAP; however, the amount permitted to be recognized is generally more restrictive under SSAP and the change in deferred taxes is reported as a direct charge to surplus.

·	The asset valuation reserve (AVR) represents a contingency reserve for credit‑related risk on most invested assets of the Company, and is charged to statutory surplus. No such reserve is required under GAAP.

·	Policy acquisition costs are expensed as incurred, while under GAAP, successful acquisition costs are deferred and recognized over either (1) the expected premium‑paying period or (2) the estimated life of the contract.

·	Reserves are reported net of ceded reinsurance; under GAAP, reserves are reported gross with a corresponding reinsurance receivable.

A 100% provision is established for unsecured reinsurance recoverable balances from unauthorized reinsurers. The change in this provision is credited or charged to unassigned surplus. Under GAAP, a provision is established for uncollectible reinsurance balances with any changes to this provision reflected in earnings for the period.

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

The statements of operations are different in certain respects, with life and annuity premiums being recognized as revenue when the policies and contracts are issued. Under GAAP, premiums on life insurance policies are recognized when due; premiums on annuity contracts are not recognized as revenue, but as deposits.

Revenues for universal life policies and investment products consist of the entire premium received, and benefits represent the death benefits paid and the change in policy reserves, unless the products do not incorporate mortality or morbidity risk. Under GAAP, premiums received in excess of policy charges are not recognized as premium revenue, and benefits represent the excess of benefits paid over the policy account values and interest credited to the account values.

The statements of cash flow differ in certain respects from the presentation required under GAAP, including the presentation of the changes in cash and short‑term investments instead of cash and cash equivalents. Short‑term investments include securities with maturities, at the time of acquisition, of one year or less. For statutory purposes, there is no reconciliation between net income and cash from operations.

·	A statement of comprehensive income is not required for SSAP reporting.

(c)	Use of Estimates

The preparation of financial statements in conformity with accounting practices prescribed or permitted by the Oklahoma Insurance Department, Annual Statement Instructions, and NAIC Manual requires management to make estimates and assumptions that affect the reported amounts of admitted assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.

Management evaluates its estimates and assumptions on an ongoing basis using historical experience and other factors, including the current economic environment, which management believes to be reasonable under the circumstances. The Company adjusts such estimates and assumptions when facts and circumstances dictate. As future events and their effects cannot be determined with precision, actual results could differ significantly from these estimates. Changes in those estimates resulting from continuing changes in the economic environment will be reflected in the financial statements in the period in which they occur. Principal estimates that could change in the future are the fair value of investments, whether a security is other‑than‑temporarily impaired, and the actuarial assumptions used in establishing policy liabilities.

(d)	Investments in Affiliates, Joint Ventures, Partnerships, or Limited Liability Companies

The statutory financial statements include the Company’s investment in its wholly owned subsidiaries. Intercompany accounts and transactions have not been eliminated in the statutory financial statements. The Company’s wholly and majority‑owned subsidiaries at December 31, 2018 and 2017 are noninsurance entities that have no significant ongoing operations other than to hold assets that are primarily for the direct or indirect benefit or use of the Company or its affiliates, and are carried at the underlying equity of the respective entity’s financial statements adjusted to a statutory basis of accounting.

The Company’s investments in joint ventures, partnerships, and limited liability companies are recorded at cost, adjusted for the Company’s share of the GAAP basis earnings or losses of the investee, net of any distributions received. Such investments are reported as other invested assets and the related adjustments are reported as unrealized capital gains or losses in surplus.

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

(e)	Investments

The investment portfolio includes bonds, preferred stocks, common stocks, mortgage loans, real estate, policy loans, other invested assets, and short‑term investments.

Investments are carried in accordance with rules established by the NAIC. Bonds are carried at cost, adjusted where appropriate for accretion of premium or amortization of discount using the scientific interest method and taking into consideration stated interest and principal provisions. Additionally, bonds rated as NAIC 6 are carried at the lower of their cost or fair market value. Preferred stocks are carried at the lower of cost or fair value since there is no premium or discount. Common stocks are carried at fair value. Policy loans are stated at their aggregate unpaid balances. Mortgage loans on real estate are stated at their aggregate unpaid balances. Real estate held for investment is carried at cost less accumulated depreciation and encumbrances. Encumbrances as of December 31, 2018 and 2017 were approximately $31,481,000 and $32,804,000, respectively. The promissory note bears interest at 4.32% and is due in monthly installments of approximately $103,000 (including interest) to 2022. Property occupied by the Company is carried at cost, less accumulated depreciation.

Realized gains or losses are determined on the specific identification basis. Unrealized gains and losses on common stocks of affiliates and nonaffiliates are accounted for as direct increases or decreases in surplus.

Because the Company’s primary business is in the insurance industry, the Company holds a significant amount of assets that it intends to match with its liabilities in relation to maturity and interest margin. In order to maximize earnings and minimize risk, the Company invests in a diverse portfolio of investments. The portfolio is diversified by geographic region, investment type, underlying collateral, maturity, and industry. Management does not believe that the Company has any significant concentrations of credit risk in its investments.

The Company generally does not invest in any low investment‑grade high‑yield investment bonds (junk bonds). Certain bonds are guaranteed by the U.S. government. The Company limits its risks by investing in bonds and stocks of rated companies, mortgage loans adequately collateralized by real estate, selective real estate supported by appraisals, and policy loans collateralized by policy cash values. In addition, the Company performs due diligence procedures prior to making mortgage loans. These procedures include evaluations of the credit worthiness of the mortgagees and/or tenants and independent appraisals.

The maximum and minimum lending rates for mortgage loans originated during 2018 were 5.06% and 4.17%, respectively. The maximum and minimum lending rates for mortgage loans originated during 2017 were 4.70% and 4.00%, respectively. The maximum and minimum lending rates for mortgage loans originated during 2016 were 4.70% and 4.00%, respectively. The maximum percentage of any one loan to the value of security at the time of the loan, exclusive of insured or guaranteed or purchase money mortgages was 80% during 2018, 2017, and 2016. During 2018, 2017, and 2016, the Company did not reduce interest rates on any outstanding mortgage loans. The Company held no mortgages with interest more than 180 days past due or impaired mortgage loans.

For loan‑backed securities, the Company has elected to use the carrying value as of January 1, 1994 as the cost for applying the retrospective adjustment method to securities purchased prior to that date. In 2018, 2017, and 2016, the Company had no changes from the retrospective to prospective methodology due to negative yield on specific securities. Prepayment assumptions for single class and multiclass mortgage‑backed/asset‑backed securities were obtained from broker‑dealer survey values or internal estimates.

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

The Company periodically reviews its investment portfolio to determine if provisions for possible losses or provisions for other‑than‑temporary impairment (OTTI) are necessary. In connection with this determination, management reviews published market values, credit ratings, independent appraisals, expected cash flows, and other valuation information. Securities with impairments are written down to the present value of expected cash flows to be collected rather than fair value unless the Company has the intent to sell or inability to retain the security until recovery of amortized cost. For the year ended December 31, 2018, the Company recorded approximately $1,926,000 of OTTI. For the year ended December 31, 2017, the Company recorded approximately $5,000,000 of OTTI. For the year ended December 31, 2016, the Company recorded $157,000 of OTTI. While management believes that no additional provisions for OTTI are currently necessary, adjustments may be necessary in the future due to changes in economic conditions. In addition, regulatory agencies periodically review investment valuation as an integral part of their examination process. Such agencies may require the Company to recognize adjustments based upon available information and judgments of the regulatory examiners at the time of their examination.

(f)

Equipment

Equipment consists of electronic data processing equipment and is stated at cost less accumulated depreciation. Equipment is depreciated on a straight‑line basis using estimated lives of five to ten years. Additions, renewals, and betterments are capitalized. Expenditures for software, maintenance, and repairs are expensed. Upon retirement or disposal of an asset, the asset and related accumulated depreciation are eliminated and any related gain or loss is included in income.

(g)	Company‑Owned Life Insurance

The Company is the owner of three single premium insurance policies and one group variable life insurance policy for certain current executives of the Company, where the Company is the beneficiary. These policies, accounted for using the investment method, were purchased in 2018, 2010 and in 2014. The policies are recorded in other assets at their net cash surrender values, as reported by the four issuing insurance companies, whose Standard & Poor’s financial strength ratings are AA+ for the single premium insurance policies and A for the group variable life insurance policy. The net cash surrender values totaled approximately $66,423,000 and $34,812,000 as of December 31, 2018 and 2017, respectively. The face value (death benefit) of the life insurance policies underlying the contracts was approximately $184,584,000 and $80,488,000 as of December 31, 2018 and 2017, respectively.

(h)

Premiums

Life premiums are recognized as revenue when the policy is written and on each anniversary date thereafter. Accident and health premiums are recognized when due from the policyholder. Both life and accident and health premiums are increased by reinsurance premiums assumed and reduced by reinsurance premiums ceded. Contracts issued that do not incorporate mortality or morbidity risk are not accounted for as insurance contracts. Amounts received as payments for such contracts are recorded as direct increases to the policy reserves.

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

The Company estimates accrued retrospective premium adjustments (premium rate stabilization) for certain contracts in its group health and group life business based on contractually determined formulas by group. The amount of net premiums written by the Company for the years ended December 31, 2018, 2017, and 2016 that were subject to retrospective rating features was approximately $190,000, $199,000 and $214,000, respectively, which represented approximately 0.05%, 0.05%, and 0.06% of net premiums written for group health and group life products in 2018, 2017, and 2016, respectively. No other net premiums written by the Company were subject to retrospective rating features.

(i)	Reinsurance

The Company accounts for reinsurance transactions as prescribed by the applicable accounting standards, which require the reporting of reinsurance transactions relating to the statements of admitted assets, liabilities, and capital and surplus on a net basis and precludes immediate gain recognition on reinsurance contracts.

(j)	Income Taxes

Current income taxes incurred includes current income taxes for the amount of federal income taxes paid or payable for the current year. These amounts are determined based on estimates of federal income taxes for the current year, including tax contingencies and benefits. The Company’s current tax recoverable is reported as a component of other assets and current tax payable is reported as a component of other liabilities. The changes in current taxes are reflected in the statutory statements of operations.

Deferred income tax assets and liabilities are determined based on differences between statutory financial statement carrying amounts of existing assets and liabilities and their respective tax bases, as well as operating loss, capital loss, and tax credit carryforwards. Temporary differences related to AVR and IMR are not included in the determination of gross deferred income taxes while temporary differences for unrealized gains/losses and nonadmitted assets are included. Gross deferred tax assets are reduced by a valuation allowance if it is more-likely-than-not (i.e. greater than 50% likelihood) that some portion or all of the gross deferred tax assets will not be realized. The deferred tax assets and liabilities are measured using federal enacted tax rates. Deferred income tax assets are limited as to their admissibility. The changes in net deferred tax assets and liabilities are reflected in surplus. The Company’s net admitted deferred tax assets are reported as a component of other assets.

(k)	Policy Liabilities

Aggregate reserves for life policies and contracts include reserve amounts principally for life insurance policies, payout annuity policies, and disability insurance policies. The life insurance reserves are principally based on the 1941, 1958, 1980, 2001 and 2017 Commissioners Standard Ordinary (CSO) mortality tables, and are established with interest rate assumptions ranging from 2.0% to 6.0%. Annuity insurance reserves are established with interest rate assumptions ranging from 3.0% to 8.8%. Disability reserves are principally based on the 2012 Group Long Term Disability Table, with adjustments for actual Company experience. The tabular interest, tabular less actual reserves released, and the tabular cost have been determined by formula. Aggregate reserves for accident and health policies include the present value of amounts not yet due on claims, additional reserves, and unearned premiums.

Policy and contract claims reserves include a provision for reported claims and claims incurred but not reported. The provision for claims incurred but not reported is estimated based primarily on Company experience. Although these provisions are the Company’s best estimate of the ultimate value, the actual results may vary from these values.

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

Liability for premiums and other deposit funds include reserves for qualified before tax annuities and other accumulation policies that do not subject the Company to any risks from policyholder mortality and morbidity. Such reserves are established using guaranteed interest rates of 3.0% to 7.5%.

The Company has a significant amount of allocated deferred annuity contracts with life contingencies. The liability for these contracts is recorded as aggregate reserves for life policies and contracts. The Company also has annuities certain without life contingencies. The liability for these contracts is recorded as a liability for premiums and other deposit funds.

The Company started issuing business in 2017 on the 2017 CSO table for life products where approved. There were two valuation basis changes for reserves in 2016. Disability reserves moved from the 1987 Commissioners Group Disability Table to the 2012 Group Long Term Disability Table. Group term life waiver of premium reserves moved from the 1952 Disability Study, period 2, with the 1958 CSO mortality table to the 2005 Group Term Life Waiver Reserve Table.

The Company waives deduction of deferred fractional premiums upon death of the insured, and returns any portion of the final premium beyond the month of death for policies developed and issued subsequent to December 1977.

Surrender values are not promised in excess of the legally computed reserves.

Extra premiums are charged for substandard lives in addition to the regular gross premium for the true age.

Mean reserves are determined by computing the regular mean reserve for the plan at the true age and holding in addition one‑half of the extra premium charge for the year.

The Company had approximately $1,305,394,000 and $1,570,099,000 of insurance in force (after reinsurance ceded) for which the gross premiums are less than the net premiums according to the standard valuation set by the state of Oklahoma at December 31, 2018 and 2017, respectively.

The Company had approximately $34,709,000 and $43,876,000 as of December 31, 2018 and 2017, respectively, of annuity actuarial reserves and deposit liabilities that were subject to discretionary withdrawal at book value less current surrender charge of 5% or more. As of December 31, 2018 and 2017, the Company has approximately $746,745,000 and $774,454,000, respectively, of annuity actuarial reserves and deposit liabilities that were subject to discretionary withdrawal at market value where the withdrawal of the funds is payable at the current market value of the assets supporting the liabilities. Annuity reserves and deposit liabilities that were subject to discretionary withdrawal at book value without adjustment were approximately $1,883,672,000 and $1,793,827,000 as of December 31, 2018 and 2017, respectively. There were approximately $46,426,000 and $56,759,000 of annuity reserves and deposit liabilities that are not subject to discretionary withdrawal at December 31, 2018 and 2017, respectively. At December 31, 2018 and 2017, the total gross annuity actuarial reserves and deposit liabilities were approximately $2,711,552,000 and $2,668,916,000, respectively, and the net annuity actuarial reserves and deposit liabilities were approximately $2,706,415,000 and $2,663,595,000, respectively. The ceded amount of annuity actuarial reserves and deposit liabilities was approximately $5,137,000 and $5,321,000 as of December 31, 2018 and 2017, respectively. The Company’s earnings related to these products are impacted by conditions in the overall interest rate environment.

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

(l)	Capital and Surplus

Capital and surplus of the Company is restricted as to payment of dividends by statutory limitations applicable to insurance companies. Without prior approval of the respective state insurance department, dividends that can be paid are generally limited to the greater of 10% of statutory capital and surplus or the statutory net gain from operations before net realized capital gains/losses reported for the previous calendar year. The maximum dividend payout, which may be made without prior approval in 2019, is approximately $92,440,000.

The Oklahoma Insurance Department has adopted Risk‑Based Capital (RBC) requirements for life insurance companies. The RBC calculation serves as a benchmark for the regulation of life insurance companies by state insurance regulators. RBC provides for surplus formulas similar to target surplus formulas used by commercial rating agencies. The formulas specify various weighting factors that are applied to statutory financial balances or various levels of activity based on the perceived degree of risk, and are set forth in the RBC requirements. The Company has calculated RBC in accordance with the NAIC’s Model Rule and RBC rules as adopted by the Oklahoma Insurance Department. The RBC, as calculated by the Company, exceeds levels requiring Company or regulatory action at December 31, 2018 and 2017.

(m)	Separate Accounts

The Company maintains a separate account under Oklahoma insurance law designated as American Fidelity Separate Account A (Account A). Account A was formerly known as American Fidelity Variable Annuity Fund A, and operated as an open‑end diversified management investment company from 1968 to 1998. Effective January 1, 1999, it was converted to a unit investment trust separate account, and it transferred its investment portfolio to the American Fidelity Dual Strategy Fund, Inc. (the Fund), an open‑end investment company sponsored by AFA, in exchange for shares of the Fund.

On November 25, 2014, Account A’s investment in the Fund was substituted with the Vanguard Total Stock Market Index Fund. Under Oklahoma law, the assets of Account A are segregated from the Company’s assets, are held for the exclusive benefit of the variable annuity contract owners, and are not chargeable with liabilities arising out of the business conducted by any other account or by the Company.

The Company also maintains separate accounts under Oklahoma insurance law designated as American Fidelity Separate Account B (Account B) and American Fidelity Separate Account C (Account C). Account B and Account C are registered as unit investment trusts under the Investment Company Act of 1940, as amended. Under Oklahoma law, the assets of each of the ten (10) segregated subaccounts of Account B and the ten (10) segregated subaccounts of Account C are held for the exclusive benefit of the variable annuity contract owners, and are not chargeable with liabilities arising out of the business conducted by any other account or by the Company.

The separate accounts maintained by the Company represent funds for nonguaranteed variable annuities. The assets of these accounts are carried at market value. The net investment experience of the separate account is credited directly to the policyholder and can be positive or negative. These variable annuities generally provide an incidental death benefit of the greater of the account value or the premium paid. The minimum guaranteed death benefit reserve is held in the Company’s general account. For the years ended December 31, 2018, 2017, and 2016 the amount of premiums, considerations, or deposits for the year was approximately $75,231,000, $74,957,000, and $67,998,000, respectively.

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

(n)	Correction of Presentation of Separate Accounts Activity

In 2018, the Company revised its reporting to properly present the premiums and annuity activity related to the separate accounts in its statements of operations in accordance with SSAP No. 56. As a result, the statement of operations for the year ended 2018 include approximately $75,231,000 in “life insurance premiums and annuity considerations,” which is offset by an increase of $50,871,000 in “annuity benefits” and an increase for net transfers of $24,360,000 in “other benefits and deductions” on the statement of operations. These amounts represent the separate account activity that is passed through the Company’s statement of operations and is reported in the reconciliation table in footnote 5, Separate Accounts. In accordance with SSAP No. 3, the 2017 and 2016 balances in the statements of operations were not changed to reflect the correct presentation. Net transfers to separate accounts were presented as equal to the change in expense allowance in 2017 and 2016. The change in presentation had no impact on surplus or net income.

(2)	Admitted and Nonadmitted Assets

Assets in the statutory statements of admitted assets, liabilities, and capital and surplus are stated at admitted asset values, which are the values permitted to be reported in the annual report to the Oklahoma Insurance Department. All other assets are “nonadmitted assets” and are excluded from the statutory statements of admitted assets, liabilities, and capital and surplus by a charge to surplus. Nonadmitted assets as of December 31 are as follows:

		2018	2017
Prepaids, deposits, and other receivables	$	7,665,554	8,855,125
Agents’ balances		26,904	39,277
Deferred tax asset		24,006,062	30,733,374
Leasehold improvements		19,061,294	21,629,636
	$	50,759,814	61,257,412

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

(3)	Fair Value of Financial Instruments

A summary of the Company’s financial instruments and the fair value estimates, methods, and assumptions is set forth below:

					Estimated fair value as of December 31, 2018
				Admitted
				assets	Level 1	Level 2	Level 3	Total
Financial assets:
	Cash and short-term
		investments	$	336,915,573	336,915,573	—	—	336,915,573
	Bonds			4,115,251,600	24,200,433	3,601,822,771	479,251,003	4,105,274,207
	Common and preferred stock			28,672,909	23,700,796	1,258,513	4,130,968	29,090,277
	Mortgage loans			484,256,052	—	—	490,749,585	490,749,585
Financial liabilities:
	Certain policy liabilities			1,936,558,042	—	—	1,937,397,267	1,937,397,267
	Borrowed money			497,669,116	—	494,665,695	—	494,665,695

					Estimated fair value as of December 31, 2017
				Admitted
				assets	Level 1	Level 2	Level 3	Total
Financial assets:
	Cash and short-term
		investments	$	241,831,403	241,831,403	—	—	241,831,403
	Bonds			4,043,435,952	21,140,938	3,610,267,203	628,129,694	4,259,537,835
	Common and preferred stock			28,426,343	23,725,544	156,727	5,495,192	29,377,463
	Mortgage loans			480,274,494	—	—	488,921,484	488,921,484
Financial liabilities:
	Certain policy liabilities			1,856,987,606	—	—	1,858,391,904	1,858,391,904
	Borrowed money			497,670,254	—	474,352,172	—	474,352,172

(a)	Cash and Short‑Term Investments

The carrying amounts of the financial instruments listed above approximate their fair values because they mature within a relatively short period of time, and do not present unanticipated credit concerns.

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

(b)	Bonds, Common Stocks and Preferred Stocks

For fixed maturities and marketable equity securities, for which market quotations generally are available, the Company primarily uses independent pricing services to assist in determining fair value measurements. When the fair value of certain securities is not readily available, the fair value estimates are based on quoted market prices of similar instruments adjusted for the differences between the quoted instruments and the instruments being valued, or fair value is estimated using discounted cash flow analysis. Interest rates used in this analysis are similar to currently offered contracts with comparable maturities as the investments being valued. The Company’s investments also include certain less liquid or private fixed maturity debt securities, such as private placements and certain structured notes. Valuations are estimated based on nonbinding broker prices or valuation models discounted cash flow models and other similar techniques that use observable or unobservable inputs and are considered Level 3.

The fair value of equity securities unaffiliated investments of the Company is based on quotations from independent pricing services, bid prices published in financial newspapers, or bid quotations received from securities dealers. Equity securities affiliated are reported at book value, which approximates fair value.

(c)	Mortgage Loans on Real Estate

Fair values are estimated for portfolios of loans with similar characteristics. Commercial mortgage loans have average net yield rates of 4.58% and 4.66% for December 31, 2018 and 2017, respectively. The fair value of mortgage loans was calculated by discounting scheduled cash flows to maturity using estimated market discount rates of 4.39% and 4.36% for December 31, 2018 and 2017, respectively. These rates reflect the credit and interest rate risk inherent in the loans. Assumptions regarding credit risk, cash flows, and discount rates are judgmentally determined using available market information and specific borrower information. The fair value of certain residential loans is based on the approximate fair value of the underlying real estate securing the mortgages.

(d)	Policy Loans

Policy loans have average interest yields of 5.91% and 5.97% as of December 31, 2018 and 2017, respectively, and have no specified maturity dates. These loans typically carry an interest rate that is tied to the crediting rate applied to the related policy and contract reserves. Policy loans are an integral part of the life insurance policies that the Company has in force and cannot be valued separately; therefore, are not presented in the previous table.

(e)	Certain Policy Liabilities

Certain policies sold by the Company are investment‑type contracts. These liabilities are segregated into two categories: premiums and other deposit funds and immediate annuities. These liabilities are further defined to segregate the deferred annuity contract with life contingencies, which are reported as aggregate reserves for life policies and contracts. The fair value of aggregate reserves for life policies and contracts is estimated as the fund value of each policy less applicable surrender charges. The fair value of the immediate annuities without life contingencies and premiums and other deposit funds is estimated as the discounted cash flows of expected future benefits less the discounted cash flows of expected future premiums, using the current pricing assumptions.

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

			2018		2017
			Carrying	Estimated	Carrying	Estimated
			amount	fair value	amount	fair value
Aggregate reserves
	for life policies
	and contracts	$	1,912,520,605	1,911,471,263	1,831,470,989	1,830,296,090
Annuities			24,037,437	25,926,004	25,516,617	28,095,814

(f)	Borrowed Money

The fair value of the Company’s notes payable is estimated by the present value of a stream of future expected cash flows using an appropriate discount rate. Discount factors are based on the LIBOR/Swap curve.

(g)	Limitations

Fair value estimates are made at a specific point in time, based on relevant market information and information about the financial instrument. These fair value estimates do not reflect any premium or discount that could result from offering for sale at one time the Company’s entire holdings of a particular financial instrument, nor do they reflect income taxes on differences between fair value and tax basis of the assets. Because no established exchange exists for a significant portion of the Company’s financial instruments, fair value estimates are based on judgments regarding future expected loss experience, current economic conditions, risk characteristics of various financial instruments, and other factors. These fair value estimates are subjective in nature and involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect the fair value estimates.

(h)	Fair Value Hierarchy

The following are the levels of hierarchy and a description of the type of valuation inputs that are used to establish each level:

Level 1 inputs are quoted in active markets for identical securities.

Level 2 inputs are other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.).

Level 3 inputs are significant unobservable inputs (including the Company’s own assumptions used to determine the fair value of investments).

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

Assets that are recorded at fair value are categorized into a three‑level fair value hierarchy as required by SSAP No. 100, Fair Value Measurements. The balances of these assets as of December 31, 2018 are as follows:

						Level 1	Level 2	Level 3	Total
Assets recorded at fair value:
	Bonds – industrial and
		miscellaneous			$	23,183,381	3,055,236	—	26,238,617
	Common stock – unaffiliated					23,203,177	119,301	—	23,322,478
	Common stock – affiliated					—	1,139,211	—	1,139,211
			Total assets at
				fair value	$	46,386,558	4,313,748	—	50,700,306

The following table presents the change for the year ended December 31, 2018 in the assets measured at fair value using unobservable inputs (Level 3):

		Loan-backed
		securities
Beginning balance	$	1,781,086
Transfers in		—
Transfers out		—
Total gain (loss) included in net income		1,307,118
Total gain (loss) included in surplus		195,673
Purchases		—
Issuances		—
OTTI		—
Sales		(3,283,877)
Settlements		—
Ending balance	$	—

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

Assets that are recorded at fair value are categorized into a three level fair value hierarchy as required by SSAP No. 100, Fair Value Measurements. The balances of these assets as of December 31, 2017 are as follows:

						Level 1	Level 2	Level 3	Total
Assets recorded at fair value:
	Bonds – industrial and
		miscellaneous			$	20,093,868	2,790,676	1,781,086	24,665,630
	Common stock – unaffiliated					23,095,464	156,727	—	23,252,191
	Common stock – affiliated					—	962,932	—	962,932
			Total assets at
				fair value	$	43,189,332	3,910,335	1,781,086	48,880,753

The following table presents the change for the year ended December 31, 2017 in the assets measured at fair value using unobservable inputs (Level 3):

		Loan-backed
		securities
Beginning balance	$	1,835,158
Transfers in		—
Transfers out		—
Total gain (loss) included in net income		90,188
Total gain (loss) included in surplus		5,941
Purchases		—
Issuances		—
OTTI		—
Sales		(150,201)
Settlements		—
Ending balance	$	1,781,086

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

(4)	Investments

Investment income for the years ended December 31 is summarized below:

			2018	2017	2016
Interest on bonds		$	180,346,598	175,570,134	176,503,325
Dividends on preferred and common stocks			314,170	312,896	311,726
Interest on mortgage loans			24,558,391	24,897,481	22,993,619
Investment real estate income			8,459,581	6,844,174	3,987,896
Interest on policy loans			3,305,649	3,240,046	3,274,867
Interest on cash and short-term investments and other			1,372,076	820,332	709,994
			218,356,465	211,685,063	207,781,427
Less investment expenses			33,396,562	33,617,790	32,288,799
	Net investment income	$	184,959,903	178,067,273	175,492,628

Realized gains (losses) for the years ended December 31 consisted of the following:

				2018	2017	2016
Bonds			$	(4,547,506)	25,901,289	20,855,691
OTTI				(1,926,441)	(5,000,000)	(157,009)
				(6,473,947)	20,901,289	20,698,682
Common stocks of nonaffiliates				752,169	660,753	1,074,925
Real estate				(820,296)	—	—
Other capital loss				(370,647)	(348,744)	(210,902)
	Total realized gains (losses) before federal
		income taxes and IMR transfers		(6,912,721)	21,213,298	21,562,705
Federal income tax expense (benefits)				(9,142,363)	9,447,403	7,278,712
Less IMR transfers				(4,218,990)	16,242,903	12,699,868
		Net realized gains (losses)	$	6,448,632	(4,477,008)	1,584,125

The gross unrealized gains on common stocks of nonaffiliates were approximately $10,741,000, $9,869,000, and $9,052,000, in 2018, 2017, and 2016, respectively. The gross unrealized losses on common stocks of nonaffiliates were approximately $0, $0, and $9,400 in 2018, 2017, and 2016, respectively.

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

The carrying value and estimated fair value of bonds, preferred stock, and common stock at December 31 are as follows:

				2018
				Carrying	Gross	Gross
				value/	unrealized	unrealized
				cost	gains	losses	Fair value
U.S. Treasury
	securities		$	1,006,957	10,094	—	1,017,051
U.S. government
	agency obligations			2,780,932	190,689	—	2,971,621
Special revenue				420,553,110	8,181,696	(26,611,053)	402,123,753
States, territories, and
	political subdivisions			467,834,029	24,468,961	(590,751)	491,712,239
Foreign government				28,159,997	1,215,173	—	29,375,170
Corporate bonds				2,307,793,450	56,359,524	(74,822,358)	2,289,330,616
Loan-backed securities				863,939,743	16,672,110	(15,051,478)	865,560,375
SVO Identified Funds				23,183,382	—	—	23,183,382
		Total bonds		4,115,251,600	107,098,247	(117,075,640)	4,105,274,207
Preferred stocks				4,211,220	417,368	—	4,628,588
Common stocks - unaffiliated				12,581,365	10,741,113	—	23,322,478
Common stocks - affiliated				103,902	1,035,309	—	1,139,211
		Total stocks		16,896,487	12,193,790	—	29,090,277
		Total	$	4,132,148,087	119,292,037	(117,075,640)	4,134,364,484

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

				2017
				Carrying	Gross	Gross
				value/	unrealized	unrealized
				cost	gains	losses	Fair value
U.S. Treasury
	securities		$	1,020,393	29,798	(3,121)	1,047,070
U.S. government
	agency obligations			3,874,559	317,184	—	4,191,743
Special revenue				392,916,263	11,535,015	(11,585,348)	392,865,930
States, territories, and
	political subdivisions			407,706,187	36,524,506	(95,260)	444,135,433
Foreign government				28,230,642	2,138,829	—	30,369,471
Corporate bonds				2,310,659,850	162,459,563	(10,296,017)	2,462,823,396
Loan-backed securities				878,934,190	30,953,824	(5,877,090)	904,010,924
SVO Identified Funds				20,093,868	—	—	20,093,868
		Total bonds		4,043,435,952	243,958,719	(27,856,836)	4,259,537,835
Preferred stocks				4,211,220	951,120	—	5,162,340
Common stocks - unaffiliated				13,382,865	9,869,326	—	23,252,191
Common stocks - affiliated				103,902	859,030	—	962,932
		Total stocks		17,697,987	11,679,476	—	29,377,463
		Total	$	4,061,133,939	255,638,195	(27,856,836)	4,288,915,298

The NAIC fair value of total bonds is approximately $5,084,000 more and $5,802,000 more than the estimated fair value in the tables above at December 31, 2018 and 2017, respectively.

The carrying value and estimated fair value of investments in bonds at December 31, 2018, by contractual maturity, are shown below. Expected maturities will differ from contractual maturities because the issuers of such securities may have the right to call or prepay obligations with or without call or prepayment penalties.

		Carrying
		value	Fair value
Due in one year or less	$	60,825,195	61,625,090
Due after one year through five years		544,302,439	549,452,302
Due after five years through ten years		1,107,938,587	1,099,891,184
Due after ten years		1,515,062,254	1,505,561,874
Loan-backed securities		863,939,743	865,560,375
SVO Identified Funds		23,183,382	23,183,382
	$	4,115,251,600	4,105,274,207

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

Proceeds from sales of bonds during 2018, 2017, and 2016 were approximately $238,736,000, $423,619,000, and $260,277,000, respectively. Gross realized gains of approximately $6,125,000, $14,693,000, and $16,506,000, and gross realized losses of approximately $14,841,000, $279,000, and $65,000, respectively, were realized on those sales. In addition, the Company realized net gains of approximately $4,168,000, $11,487,000, and $4,415,000, on bonds that were called or prepaid in 2018, 2017, and 2016, respectively.

Gross unrealized losses on investment securities and the fair value of the related securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at December 31, 2018 were as follows:

			Less than 12 months		12 months or longer		Total
				Unrealized		Unrealized		Unrealized
			Fair value	losses	Fair value	losses	Fair value	losses
Special revenue			53,695,118	(1,911,655)	242,890,758	(24,699,398)	296,585,876	(26,611,053)
States, territories and
political subdivisions			42,237,520	(440,086)	2,699,334	(150,665)	44,936,854	(590,751)
Corporate bonds			1,167,158,997	(51,835,726)	269,862,924	(22,986,632)	1,437,021,921	(74,822,358)
Loan-backed securities			280,677,754	(6,202,779)	176,571,111	(8,848,699)	457,248,865	(15,051,478)
	Total	$	1,543,769,389	(60,390,246)	692,024,127	(56,685,394)	2,235,793,516	(117,075,640)

			Less than 12 months		12 months or longer		Total
				Unrealized		Unrealized		Unrealized
			Fair value	losses	Fair value	losses	Fair value	losses
U.S. Treasury securities		$	—	—	497,578	(3,121)	497,578	(3,121)
Special revenue			30,779,623	(254,366)	225,163,292	(11,330,982)	255,942,915	(11,585,348)
States, territories and
political subdivisions			—	—	2,910,418	(95,260)	2,910,418	(95,260)
Corporate bonds			106,138,114	(1,170,655)	219,411,904	(9,125,362)	325,550,018	(10,296,017)
Loan-backed securities			96,534,855	(1,221,735)	120,167,845	(4,655,355)	216,702,700	(5,877,090)
	Total	$	233,452,592	(2,646,756)	568,151,037	(25,210,080)	801,603,629	(27,856,836)

The unrealized losses in U.S. Treasury securities and special revenue are due to interest rate fluctuations, which result in a decline in market values from original purchase price. Because the securities were acquired during a period of low interest rates, unrealized losses may continue and may become more severe in a rising interest rate environment. The Company expects the unrealized losses to reverse as the securities shorten in duration and mature, and because the Company has the ability to hold these investments and does not intend to sell until a market price recovery or maturity, these investments are not considered other‑than‑temporarily impaired.

The investments included in states, territories, and political subdivisions are high‑grade investment quality and have unrealized losses due to an increase in interest rates since acquisition. Because the decline in fair value is attributable to changes in interest rates and not credit quality, and because the Company has the ability and intent to hold these investments until a market price recovery or maturity, these investments are not considered other‑than‑temporarily impaired.

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

The investments included in special revenue securities are comprised of general obligations of U.S. government sponsored agencies for which the U.S. government is indirectly obligated. The unrealized loss is due to interest rate fluctuations, which result in a decline in market values from original purchase price. Because the securities were acquired during a period of low interest rates, unrealized losses may continue and may become more severe in a rising interest rate environment. The Company expects the unrealized losses to reverse as the securities shorten in duration and mature and because the Company has the ability to hold these investments to maturity and does not intend to sell until a market price recovery or maturity, these investments are not considered other‑than‑temporarily impaired.

The investments included in corporate securities are comprised of corporate bonds. The unrealized loss is due to the current market and economic environment, which is affecting corporate credit ratings and changes in sector spreads. The unrealized loss may continue and may become more severe if the economy continues to trend downward or interest rates rise. Because the decline in fair value is attributable to economic changes and a slight decline in credit quality, and because the Company expects all contractual cash flows will be received and has the ability and intent to hold these investments until a market price recovery or maturity, these investments are not considered other‑than‑temporarily impaired.

The investments included in loan‑backed securities are comprised of U.S. government‑sponsored agency mortgage‑backed securities for which the U.S. government is not directly obligated, and private label whole loan collateralized mortgage obligations. The unrealized losses on these securities are a result of the current market and economic conditions that are affecting the mortgage‑backed sector. The credit quality on some mortgage‑backed bonds has declined due to the larger number of home defaults. Because the decline in fair value is attributable mainly to changes in market and economic conditions and the Company believes all contractual cash flows will be received and has the ability and intent to hold these investments until a market price recovery or maturity, these investments are not considered other‑than‑temporarily impaired. When the Company believes it will not receive all contractual cash flows, the securities are considered other‑than‑temporarily impaired.

At December 31, 2018 and 2017, investments with carrying values of approximately $3,463,000 and $2,985,000, respectively, were on deposit with state insurance departments as required by statute.

The Company has no direct exposure to subprime mortgage loans. An extensive pre‑purchase analysis is performed on every loan‑backed security. By purchasing only AAA agency mortgage‑backed securities and AAA collateralized mortgage‑backed whole loan securities, direct exposure to sub‑prime mortgages is virtually eliminated. The unrealized losses on these securities are a result of the current market and economic conditions that are affecting the mortgage‑backed sector. The credit qualities on some mortgage‑backed bonds have begun to decline due to the large number of home mortgage defaults. Because the decline in fair value is attributable mainly to changes in market and economic conditions and only due slightly to a lessening of credit, the Company believes most contractual cash flows will be received.

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

The following table contains loan‑backed securities that recognized OTTI in 2018:

Intent to sell			$	—
Inability or lack of intent to retain for a period of time sufficient to recover
	amortized cost basis			—
Present value of cash flows expected to be collected in less than amortized cost
	basis			1,926,441
		Total	$	1,926,441

Listed below are the detailed securities where the present value of cash flows expected to be collected are less than amortized cost basis:

Book/adjust

carrying value

amortized cost

Amortized

Date of

before

Recognized

cost after

financial

current

Present value

other than

Fair value

statement

period

of projected

temporary

at time of

where

Cusip

OTTI

cash flows

impairment

OTTI

reported

74255DDA6

5,230,941

3,304,500

1,926,441

3,304,500

3,410,999

9/30/2018

Total

5,230,941

3,304,500

1,926,441

3,304,500

3,410,999

(5)	Separate Accounts

The Company utilizes Separate Accounts to record and account for variable annuity business. In accordance with the Insurance Code of the State of Oklahoma, variable annuities are supported for separate account classification by Title 36, Chapter 2, Section 6061. As of December 31, 2018 and 2017 the Company Separate Account statement included legally insulated assets of approximately $754,807,000 and $781,742,000, respectively, attributed to variable annuity contracts. The Separate Accounts held by the Company represent nonguaranteed variable annuity funds. The Company does not have a securities lending program.

The assets of these accounts are carried at fair market value. The net investment experience of the Separate Accounts is credited directly to the policyholder and can be positive or negative. These variable annuities generally provide an incidental death benefit of the greater of account value or premium paid. The minimum guaranteed death benefit reserve is held in Exhibit 5, Miscellaneous Reserves Section, of the Company’s general account annual statement.

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

						2018	2017	2016
1.	Premiums, considerations, or deposits for
		year ended December 31			$	75,230,630	74,957,069	67,998,086
2.	Reserves at December 31:
		For accounts with assets at:
			a.	Fair market value	$	754,806,790	781,742,340	648,033,770
			b.	Amortized cost		—	—	—
			c.	Total reserves	$	754,806,790	781,742,340	648,033,770
3.	By withdrawal characteristics:
		a.	Subject to discretionary withdrawal		$	—	—	—
		b.	With market value adjustment			—	—	—
		c.	At book value without market value adjustment
			and with current surrender charge of 5% or more			—	—	—
		d.	At fair market value			754,806,790	781,742,340	648,033,770
		e.	At book value without market value adjustment and
			with current surrender charge of 5%			—	—	—
		f.	Subtotal			754,806,790	781,742,340	648,033,770
		g.	Not subject to discretionary withdrawal			—	—	—
		h.	Total		$	754,806,790	781,742,340	648,033,770
4.	Reserves for asset default risk in lieu of AVR				$	—	—	—

Reconciliation of net transfers to or (from) Separate Accounts:

							2018	2017	2016
1.	Transfers as reported in the summary of operations of
		the separate accounts statements:
			a.	Transfers to separate accounts		$	75,230,630	75,624,877	68,594,854
			b.	Transfers from separate accounts			50,870,488	50,877,654	45,344,768
			c.	Net transfers to or (from)
					separate accounts (a) – (b)		24,360,142	24,747,223	23,250,086
2.	Reconciling adjustments:
		a.	(Increase) decrease in expense allowance				(262,768)	(1,628,734)	(1,182,735)
3.	AFA net transfer to the separate accounts (fn 1)
			a.	(1c) + (2)		$	24,097,374	23,118,489	22,067,351

(1)	The 2017 and 2016 balances in this table were changed to correctly present the disclosure requirements of SSAP No. 56. See note 1(n) for presentation errors in the statement of operations as of December 31, 2017 and 2016.

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

(6)	Liability for Accident and Health Reserves

Accident and health reserve activity for the years ended December 31, 2018, 2017, and 2016 was as follows:

				2018	2017	2016
Liability beginning of year, net of reinsurance			$	491,139,445	471,470,553	456,563,871
Incurred related to:
	Current year			418,088,762	385,359,058	379,400,106
	Prior years			(30,974,899)	(34,022,788)	(51,124,835)
		Total incurred		387,113,863	351,336,270	328,275,271
Paid related to:
	Current year			215,689,348	193,002,436	189,306,565
	Prior years			145,576,122	138,664,942	124,062,024
		Total paid		361,265,470	331,667,378	313,368,589
Liability end of year, net of reinsurance			$	516,987,838	491,139,445	471,470,553

Reinsurance recoverable on paid losses was approximately $3,162,000, $1,276,000, and $2,218,000 at December 31, 2018, 2017, and 2016, respectively.

The provision for A&H benefits pertaining to prior years decreased approximately $30,975,000 in 2018 from the prior year estimate. This decrease overall includes better than expected experience of $31,332,000 for group medical and disability and worse than expected experience of $357,000 for individual A&H business. The increase for individual A&H, primarily cancer, is due to a reserve increase due to a lengthening of the tail in the claim runoff and a one-time back payment on older diagnostic claims.

The provision for accident and health benefits pertaining to prior years decreased approximately $34,023,000 in 2017 from the prior year estimate. This decrease overall includes better than expected experience of approximately $31,113,000 for group medical and disability and approximately $2,910,000 for cancer business. The decrease is due to subsequent better than expected claim experience.

The provision for accident and health benefits pertaining to prior years decreased approximately $51,125,000 in 2016 from the prior year estimate. This decrease overall includes better than expected experience of approximately $48,009,000 for group medical and disability and approximately $3,116,000 for cancer business. The decrease is due to subsequent better than expected claim experience.

The Company paid approximately $259,000, $53,000, and $291,000 in 2018, 2017, and 2016, respectively, to settle claims related to extra contractual obligations or bad faith claims stemming from lawsuits.

(7)	Borrowed Money

AFA has borrowed approximately $496,500,000 and $496,500,000 on the line of credit with the Federal Home Loan Bank of Topeka (FHLB) at December 31, 2018 and 2017, respectively. The line of credit is secured by investment securities and cash pledged as collateral by AFA with a carrying amount of approximately $582,111,000 and $510,769,000 at December 31, 2018 and 2017, respectively, which exceeds the collateral required for this line of credit. The pledged securities are held in the Company’s name in a custodial account at United Missouri Bank, N.A. to secure current and future borrowings. To participate in this available credit, AFA has acquired 227,956 shares in 2018 and 227,532 shares in 2017 of FHLB common stock with a total carrying value of approximately $22,795,600 and $22,753,200 at December 31, 2018 and 2017, respectively.

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

FHLB Capital Stock

				2018
				General	Separate
				account	accounts	Total
Membership stock – class A			$	500,000	—	500,000
Membership stock – class B				—	—	—
Activity stock				21,842,500	—	21,842,500
Excess stock				453,100	—	453,100
		Total	$	22,795,600	—	22,795,600
Actual or estimate borrowing capacity as
	determined by the insurer		$	556,615,156

				2017
				General	Separate
				account	accounts	Total
Membership stock – class A			$	500,000	—	500,000
Membership stock – class B				—	—	—
Activity stock				21,842,500	—	21,842,500
Excess stock				410,700	—	410,700
		Total	$	22,753,200	—	22,753,200
Actual or estimate borrowing capacity as
	determined by the insurer		$	505,364,379

FHLB Membership Stock (Class A and B) Eligible for Redemption

			Not eligible
		Current	for	Less than	6 months
		year total	redemption	6 months	to 1 year	1 to 3 years	3 to 5 years
Class A	$	500,000	500,000	—	—	—	—
Class B		—	—	—	—	—	—

FHLB Borrowings

FHLB has the option to convert the initial rate of interest to an adjustable rate of interest on many of these lines of credit on the dates listed in the following table. At any time after FHLB exercises its conversion option, the Company may prepay the advance in full or in part without a fee.

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

The Company has no unused lines of credit as of December 31, 2018.

AFA had no Structured Note borrowings as of December 31, 2018 and 2017.

Information regarding the terms of the funds borrowed from FHLB are as follows:

	Interest rate
	subject to
Interest	conversion to	Date	Maturity	Balance at December 31
rate	adjustable rate	issued	date	2018	2017
3.520	January 2013	01/28/08	01/29/18	—	10,000,000
3.460	February 2013	02/01/08	02/01/18	—	15,000,000
3.490	February 2013	02/04/08	02/05/18	—	6,500,000
4.020	March 2009	03/07/08	03/07/18	—	25,000,000
3.460	March 2013	03/12/08	03/12/18	—	10,000,000
4.100	April 2009	04/28/08	04/30/18	—	5,000,000
4.290	July 2009	07/28/08	07/30/18	—	25,000,000
3.270	—	02/08/10	02/10/20	10,000,000	10,000,000
3.630	—	03/25/10	03/25/22	10,000,000	10,000,000
3.710	—	03/25/10	03/25/20	10,000,000	10,000,000
3.440	—	03/25/10	03/25/20	10,000,000	10,000,000
3.500	—	03/25/10	03/25/21	10,000,000	10,000,000
3.770	—	04/13/10	04/13/22	15,000,000	15,000,000
4.190	—	05/07/10	05/07/20	10,000,000	10,000,000
2.570	—	03/27/12	03/26/21	12,500,000	12,500,000
2.080	—	11/19/13	11/20/23	10,000,000	10,000,000
1.980	—	03/12/14	03/12/24	12,500,000	12,500,000
3.110	—	05/23/14	05/23/24	15,000,000	15,000,000
1.930	—	11/19/14	11/19/24	25,000,000	25,000,000
2.300	—	04/28/15	04/28/23	5,000,000	5,000,000
2.590	—	05/20/15	05/19/23	5,000,000	5,000,000
2.740	—	05/21/15	05/21/24	25,000,000	25,000,000
2.060	—	08/10/15	08/08/25	20,000,000	20,000,000
2.090	—	01/13/16	01/13/22	5,000,000	5,000,000
2.260	—	01/13/16	01/13/23	10,000,000	10,000,000
2.280	—	01/13/16	01/13/26	10,000,000	10,000,000
2.070	—	05/06/16	05/06/26	10,000,000	10,000,000
2.590	—	11/21/16	11/23/26	10,000,000	10,000,000
2.960	—	03/13/17	03/13/25	10,000,000	10,000,000
2.600	—	04/20/17	04/18/25	15,000,000	15,000,000
1.450	—	04/21/17	04/20/18	—	5,000,000
1.880	—	05/19/17	05/19/27	25,000,000	25,000,000
2.890	—	05/22/17	05/21/27	10,000,000	10,000,000
2.640	—	05/22/17	05/22/25	5,000,000	5,000,000
1.600	—	06/02/17	06/01/18	—	25,000,000
1.590	—	08/31/17	08/31/18	—	20,000,000
1.620	—	09/08/17	09/07/18	—	10,000,000
2.520	—	12/04/17	12/04/23	25,000,000	25,000,000

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

	Interest rate
	subject to
Interest	conversion to	Date	Maturity		Balance at December 31
rate	adjustable rate	issued	date		2018	2017
2.960		01/29/18	01/29/25		10,000,000	—
3.080		02/01/18	01/30/26		15,000,000	—
3.240		02/05/18	02/05/27		6,500,000	—
3.300		03/07/18	03/05/27		25,000,000	—
3.280		03/12/18	03/12/26		10,000,000	—
2.760		04/23/18	04/24/28		5,000,000	—
3.020		04/30/18	04/30/21		5,000,000	—
2.990		06/01/18	06/01/21		15,000,000	—
2.720		06/01/18	05/31/19		10,000,000	—
2.640		07/30/18	07/30/19		10,000,000	—
2.780		07/30/18	07/31/28		7,500,000	—
2.930		07/30/18	07/31/28		7,500,000	—
2.720		08/31/18	08/30/19		20,000,000	—
2.750		09/07/18	09/06/19		10,000,000	—
					496,500,000	496,500,000
			Accrued Interest		1,169,116	1,170,254
			Total	$	497,669,116	497,670,254

* These lines of credits have interest rates subject to conversion to an adjustable rate at the date specified above, as well as quarterly thereafter.

Interest paid in 2018, 2017, and 2016 was approximately $13,774,000, $14,385,000, and $16,146,000, respectively, and is included in investment expenses in net investment income in the accompanying statutory statements of operations.

Scheduled maturities (excluding interest) of the above indebtedness at December 31, 2018 are as follows:

2019	$	50,000,000
2020		40,000,000
2021		42,500,000
2022		30,000,000
2023		55,000,000
2024 and thereafter		279,000,000
	$	496,500,000

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

(8)	Income Taxes

The Company’s net deferred tax assets (liabilities) at December 31 and the change from the prior year are comprised of the following components:

					2018			2017			Change
					Ordinary	Capital	Total	Ordinary	Capital	Total	Ordinary	Capital	Total
Gross deferred tax assets				$	82,838,147	905,797	83,743,944	71,890,297	4,708,769	76,599,066	10,947,850	(3,802,972)	7,144,878
Statutory valuation
	allowance adjustments				—	—	—	—	—	—	—	—	—
		Adjusted gross
			deferred tax
			assets		82,838,147	905,797	83,743,944	71,890,297	4,708,769	76,599,066	10,947,850	(3,802,972)	7,144,878
Deferred tax
	assets nonadmitted				24,006,062	—	24,006,062	28,005,630	2,727,744	30,733,374	(3,999,568)	(2,727,744)	(6,727,312)
		Sub-total net
			admitted
			deferred tax
			assets		58,832,085	905,797	59,737,882	43,884,667	1,981,025	45,865,692	14,947,418	(1,075,228)	13,872,190
Deferred tax liabilities					29,292,446	2,373,341	31,665,787	19,046,473	1,981,025	21,027,498	10,245,973	392,316	10,638,289
		Net admitted
			deferred tax
			assets
			(liabilities)	$	29,539,639	(1,467,544)	28,072,095	24,838,194	—	24,838,194	4,701,445	(1,467,544)	3,233,901

Management has reviewed whether a valuation allowance is needed on its total gross deferred tax assets reported above based on factors such as past history and trends, projected taxable income, and expiration of carryforwards. Additionally, management considered the various aspects of the Tax Cuts and Jobs Act of 2017 (Tax Act) when it assessed whether or not its criteria for establishing a valuation allowance was impacted. Management believes that in 2018 and 2017 it is more likely than not that the results of operations will generate sufficient taxable income to realize its gross deferred tax assets on ordinary items. Additionally, in 2018 and 2017, management believes that there are sufficient capital gains available in its capital assets portfolio to substantiate the Company’s ability to realize its gross deferred tax assets on capital items.

On February 8, 2018, the NAIC issued Interpretation (INT) 18-01 to address the reporting and updating of estimates that companies are required to reflect as various accounting adjustments in their financial statements as a result of the Tax Act. This guidance provided that accounting computations or assessments may be considered “incomplete” when the financial statements are filed. For those items which were “incomplete” but for which a reasonable estimate could be made, those amounts should have been recorded as provisional in the financial statements for the year ended December 31, 2017. Changes to amounts recognized in the financial statements for the year ended December 31, 2017 as a result of the Tax Act shall be recognized as a change in accounting estimate, pursuant to SSAP No. 3, when the information necessary to update the estimate becomes available. All income tax effects as of December 31, 2017 were identified and appropriately accounted for as a result of the Tax Act in accordance with INT 18-01. The tax accounting for the revaluation of deferred tax liabilities as of December 31, 2017 was complete. The 2017 income tax effects of life insurance reserves for tax purposes pursuant to the Tax Act were recorded as provisional since the analysis was incomplete but a reasonable estimate was determined. As of December 31, 2018, the Company has completed its analysis of income tax effects due to the Tax Act on life reserves. The Company recorded additional admitted deferred tax assets of $2,900,000, resulting from changes to the provisional estimate of the Tax Act impact on changes to life reserves.

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

The Company’s admission calculation components at December 31 are as follows:

					2018			2017			Change
					Ordinary	Capital	Total	Ordinary	Capital	Total	Ordinary	Capital	Total
(a)	Federal income taxes paid
	in prior years recoverable
	through loss carrybacks			$	—	—	—	—	—	—	—	—	—
(b)	Adjusted gross deferred tax
	assets expected to be
	realized (excluding the
	amount of deferred tax
	assets from (a) above)
	after application of the
	threshold limitation. (The
	lesser of (b)1 and (b)2 below):
	1.	Adjusted gross deferred
		tax assets expected to
		be realized following
		the balance sheet date			28,072,095	—	28,072,095	24,838,194	—	24,838,194	3,233,901	—	3,233,901
	2.	Adjusted gross deferred
		tax assets allowed per
		limitation threshold			—	—	71,573,078	—	—	60,867,922	—	—	10,705,156
			Lesser of b(1) or b(2)		28,072,095	—	28,072,095	24,838,194	—	24,838,194	3,233,901	—	3,233,901
(c)	Adjusted gross deferred tax
	assets (excluding the amount
	of deferred tax assets from
	(a) and (b) above) offset by
	gross deferred tax liabilities				30,759,990	905,797	31,665,787	19,046,473	1,981,025	21,027,498	11,713,517	(1,075,228)	10,638,289
(d)	Deferred tax assets admitted
	Total ((a) + (b) + (c ))			$	58,832,085	905,797	59,737,882	43,884,667	1,981,025	45,865,692	14,947,418	(1,075,228)	13,872,190

			2018	2017
Ratio percentage used to determine recovery period and
	threshold limitation amount		730 %	724 %
Amount of adjusted capital and surplus used to determine
	recovery period and threshold limitation in (b)2 above	$	517,531,960	441,341,339

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

As of December 31, the change in the net deferred income taxes is comprised of the following (this analysis is exclusive of the nonadmitted DTAs as the change in nonadmitted assets is reported separately from the change in net deferred income taxes in the statutory statements of capital and surplus):

				2018	2017	Change
Gross deferred tax assets			$	83,743,944	76,599,066	7,144,878
Gross deferred tax liabilities				31,665,787	21,027,498	10,638,289
	Net deferred tax
		assets/liabilities		52,078,157	55,571,568	(3,493,411)
Statutory valuation allowance adjustment				—	—	—
	Net deferred tax
		assets/liabilities after
		statutory valuation
		allowance		52,078,157	55,571,568	(3,493,411)
Tax effect of unrealized (gains) losses				(1,713,219)	(1,735,014)	21,795
Adjustment to tax on unrealized (gains) losses				18,569	—	18,569
Statutory valuation allowance adjustment
	allocated to unrealized			—	—	—

	Net deferred income taxes		$	53,772,807	57,306,582	(3,533,775)

The impact of the Company’s tax planning strategies as of December 31 is as follows:

			2018		2017		Change
			Ordinary	Capital	Ordinary	Capital	Ordinary	Capital
Adjusted gross DTAs		$	82,838,147	905,797	71,890,297	4,708,769	10,947,850	(3,802,972)
Percentage of adjusted
	gross DTAs attributable
	to the impact of tax
	planning strategies		— %	1.1 %	— %	6.1 %	— %	(5.0)%
Net admitted adjusted gross
	DTAs	$	58,832,085	905,797	43,884,667	1,981,025	14,947,418	(1,075,228)
Percentage of net admitted
	adjusted gross DTAs
	attributable to the impact
	of tax planning strategies		— %	1.5 %	— %	4.3 %	— %	(2.8)%

None of the Company’s tax‑planning strategies include the use of reinsurance.

There are no temporary differences for which deferred tax liabilities are not recognized.

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

As of December 31, current income taxes incurred consist of the following major components:

					2018	2017	Change
Current federal income tax – operations				$	7,521,969	31,554,611	(24,032,642)
Foreign income tax					—	—	—
		Subtotal			7,521,969	31,554,611	(24,032,642)
Current federal income tax on capital gains					(9,142,363)	9,447,403	(18,589,766)
Current tax on the cumulative impact of
	accounting error reported in surplus				—	—	—
		Federal and foreign income
			taxes incurred	$	(1,620,394)	41,002,014	(42,622,408)

					2017	2016	Change
Current federal income tax – operations				$	31,554,611	32,030,414	(475,803)
Foreign income tax					—	—	—
		Subtotal			31,554,611	32,030,414	(475,803)
Current federal income tax on capital gains					9,447,403	7,278,712	2,168,691
Current tax on the cumulative impact of
	accounting error reported in surplus				—	(2,528,052)	2,528,052
		Federal and foreign income
			taxes incurred	$	41,002,014	36,781,074	4,220,940

As of December 31, deferred income tax assets and liabilities consist of the following major components:

						2018	2017	Change
Deferred tax assets:
	Ordinary:
		Discounting of unpaid losses			$	13,084,755	4,141,107	8,943,648
		Policyholder reserves				15,722,541	19,305,517	(3,582,976)
		Investments				94,336	—	94,336
		Deferred acquisition costs				37,295,387	33,417,685	3,877,702
		Fixed assets				1,662,697	—	1,662,697
		Compensation and benefits accrual				8,314,627	7,506,173	808,454
		Receivables – nonadmitted				5,997,730	6,793,711	(795,981)
		Other				666,074	726,104	(60,030)
			Subtotal			82,838,147	71,890,297	10,947,850
	Statutory valuation allowance adjustment					—	—	—
	Nonadmitted					24,006,062	28,005,630	(3,999,568)
			Admitted ordinary deferred
				tax assets	$	58,832,085	43,884,667	14,947,418

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

						2018	2017	Change
	Capital:
		Investments			$	905,797	4,708,769	(3,802,972)
			Subtotal			905,797	4,708,769	(3,802,972)
	Statutory valuation allowance adjustment					—	—	—
	Nonadmitted					—	2,727,744	(2,727,744)
			Admitted capital deferred
				tax assets		905,797	1,981,025	(1,075,228)
			Admitted deferred tax assets			59,737,882	45,865,692	13,872,190
Deferred tax liabilities:
	Ordinary:
		Fixed Assets				1,065,486	112,342	953,144
		Deferred and uncollected premium				18,826,113	18,630,982	195,131
		Other				9,400,847	303,149	9,097,698
			Subtotal			29,292,446	19,046,473	10,245,973
	Capital:
		Investments				2,373,341	1,981,025	392,316
			Subtotal			2,373,341	1,981,025	392,316
			Deferred tax liabilities			31,665,787	21,027,498	10,638,289
			Net deferred tax
				assets	$	28,072,095	24,838,194	3,233,901

The following items are included in Other Ordinary Deferred Tax Liabilities:

				2018	2017	Change

Change in reserve method			$	9,293,554	168,337	9,125,217
Other (items < 5% of total ordinary tax
	liabilities)			107,293	134,815	(27,522)

		Total	$	9,400,847	303,152	9,097,695

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

The Company’s income tax incurred and change in deferred tax differ from the amount obtained by applying the federal statutory rate of 21% in 2018 and 35% in 2017 to income before income taxes and net realized capital gains (losses) as follows:

							Effective			Effective		Effective
							2018			2017		2016
						2018	tax rate		2017	tax rate	2016	tax rate
Income before taxes and realized
	capital gains (losses)				$	99,962,157	—%	$	102,230,144	—%	106,880,558	—%
Income tax expense at enacted statutory
	rate				$	20,992,053	21.0%	$	35,780,550	35.0%	37,408,196	35.0%
Increase (decrease) in tax resulting
	from:
		Dividends received deduction			$	(844,403)	-0.7%	$	(1,365,947)	-1.2%	(1,573,155)	-1.5%
		Nondeductible expenses for
			meals and other items			977,116	1.0%		1,662,620	1.6%	1,913,616	1.8%
		Management fees				(1,269,030)	-1.3%		(2,253,425)	-2.2%	(1,960,000)	-1.8%
		Tax credits				(2,126,320)	-2.2%		(2,100,320)	-2.1%	(1,894,320)	-1.8%
		Tax-exempt income				(105,065)	-0.1%		(2,741)	—%	(3,053)	—%
		Tax adjustment for IMR				(1,243,173)	-1.1%		(2,102,283)	-2.0%	(1,669,899)	-1.6%
		Deferred tax benefit on
			nonadmitted assets			795,981	0.8%		4,375,255	4.3%	(5,230,427)	-4.9%
		Remove impact of tax rate change
			included in deferred tax benefit
			on nonadmitted assets			—	—%		(4,529,141)	-4.5%	—	—%
		Timing differences on realized
			gains and losses			4,047,322	3.9%		(1,773,790)	-1.7%	268,234	0.3%
		Adjustment to deferred taxes for tax
			rate changes from 35% to 21%			—	—%		38,204,386	37.4%	—	—%
		Prior year adjustment to current
			taxes at 35%			#########	-23.5%		(6,831,280)	-6.7%	—	—%
		Prior year adjustment to deferred taxes at
			21% (at 35% for 2017 and 2016)			13,309,175	13.3%		4,721,930	4.6%	(506,802)	-0.5%

				Total income tax expected	$	11,055,744	11.1%	$	63,785,814	62.5%	26,752,390	25.0%

Current income taxes incurred
	(excludes tax on net realized gains
	and losses)				$	7,521,969	7.6%	$	31,554,611	31.0%	32,030,414	30.0%
Net change in deferred income taxes
	(excludes tax on unrealized gains
	and losses)					3,533,775	3.5%		32,231,203	31.5%	(5,278,024)	-5.0%

				Total income tax reported	$	11,055,744	11.1%	$	63,785,814	62.5%	26,752,390	25.0%

The enactment of the Tax Act materially impacted deferred income taxes in 2017 as well as current taxes in 2018 as a result of the tax rate change from 35% in 2017 to 21% in 2018 forward. During 2017, deferred tax assets decreased $37,048,000 due to the Tax Act tax rate change, which includes the impact of the tax rate change on unrealized gains and losses. During 2018, the pension redesignation from 2018 to 2017 and capital loss carryback from 2018 to prior years resulted in an additional 14% of current Federal income tax benefit. The Company’s 2018 pension contribution of $54,556,000 was redesignated to 2017 resulting in an additional Federal income tax benefit of $7,638,000. The Company generated a capital loss for tax purposes in 2018 of approximately $26,186,000 which will be carried back to its 2015, 2016, and 2017 Federal income tax returns, resulting in an additional Federal income tax benefit of $3,666,000.

As of December 31, 2018, there are no net operating loss, capital loss, or tax credit carryforwards available for tax purposes.

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

The following are income taxes incurred in the current and prior years that will be available for recoupment in the event of future net losses:

		Ordinary	Capital	Total
December 31, 2018	$	—	—	—
December 31, 2017		—	5,003,650	5,003,650
December 31, 2016		—	—	—

Due to the change in Federal tax law resulting from the enactment of the Tax Act on December 22, 2017, the 3-year carry back of ordinary losses to the extent of ordinary income generated in the carry back years is no longer available. The 3-year carry back of capital losses is still allowed to the extent of capital gains generated in the carry back years. The amounts in this table represent the income tax incurred on capital gains in the current and prior years that will be available for recoupment in the event of future net capital losses.

As of December 31, 2018, there were no deposits admitted under Section 6603 of the Internal Revenue Code.

The Company is included in a consolidated federal income tax return with the following entities:

American Fidelity Corporation								American Fidelity International Holdings, Inc.
American Public Life Insurance Company								AF Apartments, Inc.
American Fidelity Securities, Inc.								Market Place Realty Corporation
InvesTrust								American Fidelity Property Services, LLC
American Fidelity General Agency, Inc.								American Fidelity Community Services, Inc.
AF Professional Employment Group, LLC								Home Rentals Inc.
First Financial Securities of America, Inc.								Apple Creek Apartments, Inc.
American Fidelity Property Company								Alcott HR Group, LLC
American Fidelity Administrative Services, LLC								All In Sports & Entertainment, LLC

The method of tax allocation between the companies is subject to a written agreement approved by the Board of Directors. Allocation is based on separate return calculations at the group’s effective tax rate with current credit for net losses. Intercompany tax balances are settled annually.

The Company has no tax loss contingencies for which it is reasonably possible that the total liability will significantly increase within twelve months of the reporting date.

The Company files income tax returns in the U.S. federal jurisdiction and various states. The Company is no longer subject to U.S. federal income tax examinations for years prior to 2015 and state and local income tax examinations for years prior to 2014. The Company is not currently under examination by any taxing authority.

(9)	Reinsurance

Reinsurance contracts do not relieve the Company from its obligations to policyholders. Failure of reinsurers to honor their obligations could result in losses to the Company. The Company evaluates the financial condition of its reinsurers and monitors concentrations of credit risk arising from similar geographic regions, activities, or economic characteristics of the reinsurers to minimize its exposure to significant losses from reinsurer insolvencies. Management believes that all reinsurers presently used are financially sound and will be able to meet their contractual obligations; therefore, no significant allowance and uncollectible amounts has been included in the December 31, 2018 or 2017 statutory financial statements. Estimated amounts that reduce the reserves for future policy benefits at December 31, 2018 and 2017 for reinsurance ceded are approximately $1,094,467,000 and $1,121,336,000, respectively. At December 31, 2018 and 2017, amounts that reduced the reserves for future policy benefits of approximately $715,505,000 and $734,182,000, respectively, were associated with one reinsurer (note 14).

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

At December 31, 2018 and 2017, the Company had unsecured aggregate recoverable from the following reinsurers for policy and contracts claims, paid and unpaid, that exceeds 3% of the Company’s surplus, as follows:

Group			2018	2017
Hannover Life Reassurance Company		$	2,496,774	1,714,431
Hannover Reassurance (Ireland) LTD			16,372,259	15,862,370
	Total group		18,869,033	17,576,801
Gerber Life Insurance Company			—	9,535,683
	Total	$	18,869,033	27,112,484

Reinsurance agreements in effect for life insurance policies vary according to the age of the insured and the type of risk. Retention amounts for life insurance range from $250,000 on domestic individual life coverages to $500,000 on group life and Latin American individual life coverages, with slightly lower limits on accidental death benefits. At December 31, 2018 and 2017, the face amounts of life insurance in force that are reinsured amounted to approximately $7,759,000,000 and $8,167,000,000, respectively (approximately 27.0% and 29.8% of total life insurance in force, respectively).

Reinsurance agreements in effect for accident and health insurance policies vary with the type of coverage. There are no accident and health reinsurance treaties subject to retention limits.

The effects of reinsurance agreements on earned premiums, prior to deductions for benefits, and commission allowances are as follows for the years ended December 31, 2018, 2017, and 2016:

		2018	2017	2016
Reinsurance ceded	$	207,564,634	222,403,939	209,666,031
Reinsurance assumed		52,646,255	50,128,570	44,768,192

Reinsurance agreements reduced benefits paid for life and accident and health policies by approximately $199,434,000, $197,162,000, and $198,393,000 for the years ended December 31, 2018, 2017, and 2016, respectively.

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

(10)	Employee Benefit Plans

The Company participates in a pension plan (the Plan), sponsored by AFC, and is not directly liable for obligations under the Plan. The Plan covers all employees who have satisfied longevity and age requirements. The Company’s funding policy is to contribute annually the maximum amount that can be deducted for federal income tax purposes. Contributions are intended to provide not only for benefits attributed to service to date, but also for those expected to be earned in the future. The Company contributed approximately $56,056,000, $16,150,000, and $9,566,000 to the Plan during the years ended December 31, 2018, 2017, and 2016, respectively. AFC also offers certain postretirement benefits other than the Plan.

On September 12, 2018, the Company made an additional $39,000,000 cash contribution over the required minimum contribution of $17,056,000. This transaction allowed the Company to take advantage of the 14% differential in tax rate (35% vs. 21%) by designating all 2018 payments as contributions for the 2017 Plan Year for the Plan and for Federal Income Tax purposes. This designation had to occur and be funded prior to the filing of the 2018 tax return. The additional contribution had a pretax impact of $39,000,000. The tax benefits related to the election on required and additional contributions reduced the expense by $16,038,000, causing a net decrease of $22,962,000.

The Company participates in a defined‑contribution thrift and profit sharing plan as provided under Section 401(a) of the Code, which includes the tax deferral feature for employee contributions provided by Section 401(k) of the Code. The Company contributed approximately $8,898,000, $8,483,000, and $7,664,000 to this plan during the years ended December 31, 2018, 2017, and 2016, respectively.

SSAP No. 102, Accounting for Pensions, A replacement of SSAP No. 89, is effective for years beginning January 1, 2013. The Company participates in a Consolidated/Holding Company plan for pension benefits and is not directly liable for obligations under the Plan. The accounting and reporting requirements of SSAP No. 102 have no impact on the Company’s financial statements, as the applicable requirements under Paragraph 80 have not changed from past years.

(11)

Leases

The Company leases various properties to nonaffiliates under operating lease agreements, which expire or are cancelable within one year. The properties leased are included in the statutory statements of admitted assets, liabilities, and capital and surplus as investment real estate. Rental income on these properties is included in the statutory statements of operations as net investment income.

Investment real estate held for lease is as follows at December 31:

				2018	2017
Land and buildings, net of encumbrances			$	33,258,423	28,953,530
	Less accumulated depreciation			(9,186,852)	(8,457,362)
		Net investment real estate	$	24,071,571	20,496,168

The Company entered into a lease agreement with 9000 Broadway LLC, a related party, on December 31, 2012, and modified effective January 1, 2014. The balance due will be paid in monthly amounts of approximately $714,000 over the 20-year term of the lease.

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

(12)	Related‑Party Transactions

The Company paid cash dividends to AFC in the amount of approximately $35,000,000 during 2018, $35,000,000 during 2017, and $45,000,000 during 2016. There were no other transactions with affiliates in amounts, which exceeded one‑half of one percent of the total admitted assets of the Company.

At December 31, 2018 and 2017, the Company reported approximately $6,033,000 and $9,936,000, respectively, as amounts due from AFC.

The Company leases office space from a subsidiary of AFC. The rent payments associated with this lease were approximately $9,593,000, $13,643,000, and $14,045,000 in 2018, 2017, and 2016, respectively.

During 2017, 2016, and 2015, the Company entered into three‑year software lease agreements with AFC. Lease expense related to these agreements was approximately $6,246,000, $5,397,000, and $5,471,000 for the years ended December 31, 2018, 2017, and 2016, respectively, and is included in general insurance expenses.

The Company leases automobiles, furniture, and equipment from a partnership that owns a controlling interest in AFC. These operating leases are cancelable upon one month’s notice. During the years ended December 31, 2018, 2017, and 2016, payments under these leases were approximately $12,366,000, $12,692,000, and $10,904,000, respectively.

Under a service agreement approved by the Oklahoma Insurance Department, AFC provides certain services on a cost basis with no markup. During the years ended December 31, 2018, 2017, and 2016, the Company paid management fees to AFC totaling approximately $14,494,000, $8,456,000, and $8,662,000, respectively.

Under a service agreement approved by the Oklahoma Insurance Department, AFA provides certain services to American Fidelity International (Bermuda) Ltd. (AFIBL). During the years ended December 31, 2018, 2017, and 2016, AFIBL paid management fees to AFA of approximately $2,103,000.

Under a service agreement approved by the Oklahoma Insurance Department, AFA provides certain services to American Public Life Insurance Company (APL). During the years ended December 31, 2018, 2017, and 2016, APL paid management fees to AFA of approximately $1,500,000, $1,500,000, and $750,000, respectively.

During the years ended December 31, 2018, 2017, and 2016, the Company paid investment advisory fees to a partnership that owns a controlling interest in AFC totaling approximately $10,822,000, $10,481,000, and $10,048,000, respectively.

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

(13)	Commitments and Contingencies

Rent expense for the years ended December 31, 2018, 2017, and 2016 was approximately $25,583,000, $30,516,000, and $29,273,000, respectively. A portion of rent expense relates to leases that expire or are cancelable within one year. The approximate aggregate minimum annual rental commitments as of December 31, 2018 under noncancelable long‑term leases for office space are as follows (in thousands):

2019	$	11,382
2020		10,559
2021		9,511
2022		8,704
2023		8,575

The Company has outstanding mortgage loan commitments of approximately $16,288,000 and $9,500,000 at December 31, 2018 and 2017, respectively.

The Company is subject to state guaranty association assessments in all states in which it is licensed to do business. These associations generally guarantee certain levels of benefits payable to resident policyholders of insolvent insurance companies. Many states allow premium tax credits for all or a portion of such assessments, thereby allowing potential recovery of these payments over a period of years. However, several states do not allow such credits. The Company estimates its liabilities for guaranty association assessments by using the latest information available from the National Organization of Life and Health Insurance Guaranty Associations. The Company monitors and revises its estimates for assessments as additional information becomes available, which could result in changes to the estimated liabilities. As of December 31, 2018, and 2017, liabilities for guaranty association assessments totaled approximately $1,770,000 and $2,210,000, respectively. Other operating expenses related to state guaranty association assessments were minimal for the years ended December 31, 2018 and 2017.

In the normal course of business, there are various legal actions and proceedings pending against the Company and its subsidiaries. In management’s opinion, the ultimate liability, if any, resulting from these legal actions will not have a material adverse effect on the Company’s financial position.

(14)	Acquired Business – Mid‑Continent Life Insurance Company

Effective December 31, 2000, the Company entered into an assumption reinsurance agreement with the Commissioner of Insurance of the State of Oklahoma, in his capacity as receiver of Mid‑Continent Life Insurance Company (MCL) of Oklahoma City, Oklahoma. Under this agreement, the Company assumed MCL’s policies in force, with the exception of a small block of annuity policies that was assumed effective January 1, 2001. In a concurrent reinsurance agreement, the Company ceded 100% of the MCL policies assumed to Hannover Life Reassurance Company of America. In 2002, this agreement was then transferred to Hannover Life Reassurance Company of Ireland (HLR). The agreement with HLR is a funds withheld arrangement, with the Company ceding net policy assets and liabilities of approximately $706,188,000 and $724,753,000 to HLR and maintaining a funds withheld liability at December 31, 2018 and 2017, respectively.

Under the terms of the agreement with the receiver, the Company has guaranteed that the amount of premiums charged under the assumed “Extra‑Life” contracts will not increase during the 17‑year period beginning December 31, 2000, and will only increase thereafter if certain conditions are met. In 2018, the Company demonstrated to the Oklahoma Department of Insurance that those certain conditions had been met and the Company implemented a rate increase beginning in July of 2018. The Company has also guaranteed that the current dividend scale on the assumed “Extra‑Life” contracts shall not be reduced or eliminated during the five‑year period beginning December 31, 2000. Beginning January 1, 2006, the dividends on the assumed “Extra‑Life” contracts are no longer guaranteed pursuant to the assumption reinsurance agreement with the Commissioner of Insurance of the State of Oklahoma.

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

As required by the terms of the assumption reinsurance agreement with the Commissioner of Insurance of the State of Oklahoma, the Company and HLR agreed that a Supplemental Policyholder Reserve (SPR) would be established. The initial SPR is equal to the net of the assets and liabilities received from MCL under the assumption agreement, less amounts ceded to other reinsurance carriers. The SPR is 100% ceded to HLR.

The purpose of the SPR is to provide additional protection to the MCL policyholders against premium increases and to ensure that profits are recognized over the lives of the underlying policies, rather than being recognized up front. The method for calculation of the initial SPR was specified precisely in the agreement with the receiver. The method for calculating the SPR for periods beyond the purchase date was developed by the Company, as this reserve is not otherwise required statutorily or under existing actuarial valuation guidance. The SPR is divided into two parts: (a) an additional reserve for future benefits, which is an estimate of the amount needed, in addition to the policy reserves and liability for future dividends, to fund benefits assuming there are no future premium rate increases, and (b) an additional reserve for future estimated profit, which represents the profit the Company expects to earn on this business over the lives of the underlying policies. The SPR is reprojected each year to recognize current and future profits as a level percentage of future projected required capital amounts each year, resulting in a level return on investment. Any remaining SPR will not automatically be released after the premium guarantee period of 17 years because the SPR is to be held until there is an actuarial certainty that premium rate increases will not be needed. The calculation of the SPR is subject to significant volatility, as it is highly dependent upon assumptions regarding mortality, lapse experience, and investment return. Small shifts in any of these underlying assumptions could have a dramatic impact on the value of the SPR. The SPR was approximately $357,847,000 and $369,102,000 for 2018 and 2017, respectively.

Under the terms of the agreement with HLR, HLR has agreed to share future profits on a 50/50 basis with the Company through an experience refund account. The experience refund account is calculated as premium income plus investment income less reserve increases (including the SPR), benefits paid, and administrative expense allowances paid to the Company and is settled on a quarterly basis. Losses are not shared on a 50/50 basis, except to the extent that a net loss in the experience account at the end of a quarter carries forward to future quarters. There was no experience refund earned by the Company in 2018 and 2017. Due to the nature of a funds withheld reinsurance arrangement, the components of the experience refund calculation are reported as separate components in the accompanying summary of operations. Premium income, reserve increases, and benefits paid related to this block are reported as reductions of premium income, changes in reserves, and benefits for reinsurance ceded, as required by the terms of the agreement. Investment income on the funds withheld is included in AFA’s investment income, and administrative expense allowances paid to AFA are reported as a reduction of AFA’s expense. The impact of ceding investment income on funds withheld is reported as a reduction of net investment income in the accompanying summary of operations.

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

(15)	Life Contracts – Premiums

Deferred and uncollected life insurance premiums and annuity considerations as of December 31, 2018 were as follows:

			Gross	Net of loading
Ordinary new business		$	22,491,514	2,118,863
Ordinary renewal			45,199,738	36,110,684
Group life			91,343	91,269
	Total	$	67,782,595	38,320,816

Deferred and uncollected life insurance premiums and annuity considerations as of December 31, 2017 were as follows:

			Gross	Net of loading
Ordinary new business		$	22,313,524	2,142,189
Ordinary renewal			43,492,685	36,593,406
Group life			55,596	55,563
	Total	$	65,861,805	38,791,158

(16)	Managing General Agents and Third‑Party Administrators

Managing general agents (MGAs) and direct written contracts at December 31 were as follows:

Name and address of managing general agent or third-party administrator	Federal employer identification number	Exclusive contract	Type of business written	Type of authority granted *	2018 Direct written premium	2017 Direct written premium	2016 Direct written premium
TRU Services, LLC 200 Cummings Center, Ste. 272D Beverly, MA 01915	04-3392571	No	Excess loss medical and group life	U, C, CA, R, P	**	$31,322,507	37,729,238
	Aggregate other				$58,646,495	65,270,322	47,981,973
Total MGA and third-party administrator premium					$58,646,495	96,592,829	85,711,211
* Abbreviations: U: Underwriting C: Claims payment CA: Claims adjustment R: Reinsurance ceding P: Premium collection ** Direct written premium for TRU Services, LLC does not exceed 5% of the policyholder surplus

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

(17)	Affiliated Entities

The following is a summary of the significant ownership and affiliated entity relationships that existed at December 31, 2018:

Immediate parent								American Fidelity Corporation
Other insurance affiliates								American Public Life Insurance Company
								American Fidelity International (Bermuda) Ltd.
Other affiliates								American Fidelity International Holdings, Inc.
								American Fidelity Property Company
								6303 Portland, LLC
								Broadway Tech, LLC
								Apple Creek Apartments, Inc.
								American Fidelity General Agency, Inc.
								American Fidelity Securities, Inc.
								First Fidelity Bank and its affiliates
								INSURICA, Inc. and its affiliates
								Cameron Enterprises, A Limited Partnership and its affiliates
								InvesTrust Consulting, LLC
								InvesTrust Retirement Specialists, LLC
								InvesTrust
								American Fidelity Property Services, LLC
								Alcott HR Group, LLC
								First Financial Securities of America, Inc.
								AF Professional Employment Group, LLC
								Hawaii Development, LLC
								Home Rentals, Inc.
								9000 Broadway, LLC
								Market Place Realty Corporation
								Health Services Administration, LLC
								American Fidelity Community Services, Inc.
								AF Apartments, Inc.
								Oklahoma Winery Partners, LLC
								Vintage Oakville Cross, LLC
								American Fidelity Administrative Services, LLC
								First Financial Capital Corporation, Inc. and its affiliates
								All In Sports & Entertainment, LLC

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

(18)	Reconciliations

Reconciliations of capital and surplus and net income on a GAAP basis to the amounts included in the accompanying statutory financial statements for the years ended December 31, 2018 and 2017 are as follows (in thousands):

					Net income,		Capital and surplus,
					year ended December 31		at December 31
					2018	2017	2018	2017
Amounts as reported on statutory
	basis			$	98,889	66,199	505,226	430,624
Adjustments:
	Deferred policy acquisition costs				50,098	41,358	681,183	622,638
	Policy benefit reserves				(19,647)	(254)	(21,705)	(2,275)
	Deferred federal income taxes				(9,098)	57,323	(102,268)	(120,313)
	Due and deferred premiums				(1,050)	(2,066)	(25,722)	(24,458)
	Nonadmitted assets				—	—	26,162	30,222
	Asset valuation reserve				—	—	40,378	35,555
	Invested assets				(74,834)	51,719	(11,564)	215,696
	Funds withheld derivative				75,661	(46,050)	(47,099)	(122,760)
	Other, net				(823)	(2,483)	32,997	35,552
		Amounts on a GAAP
			basis for consolidated
			presentation	$	119,196	165,746	1,077,588	1,100,481

		Net income, year ended December 31		Capital and surplus, at December 31
		Net income, year ended December 31		Capital and surplus, at December 31
		2017	2016	2017	2016
Amounts as reported on statutory
	basis	66,199	76,434	430,624	414,602
Adjustments:
	Deferred policy acquisition costs	41,358	36,200	622,638	584,217
	Policy benefit reserves	(254)	10,674	(2,275)	(2,625)
	Deferred federal income taxes	57,323	(15,206)	(120,313)	(173,589)
	Due and deferred premiums	(2,066)	(1,978)	(24,458)	(21,807)
	Nonadmitted assets	—	—	30,222	31,329
	Asset valuation reserve	—	—	35,555	32,881
	Invested assets	51,719	40,676	215,696	122,712
	Funds withheld derivative	(46,050)	(34,465)	(122,760)	(76,710)
	Other, net	(2,483)	(7,102)	35,552	26,053

	Amounts on a GAAP basis
	for consolidated presentation	$165,746	105,233	1,100,481	937,063

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Notes to Statutory Financial Statements

(19)	Guaranty Assessments

As of December 31, 2018, American Fidelity Assurance Company did not receive notice of any assessments that would have a material financial impact.

The amount of recognized liabilities under SSAP No. 35R is $1,770,000 and the related asset for premium tax credits is $971,000. The Company expects that the assessments would be billed and paid over the next year and the majority of the premium tax offsets would be realized over the next five years after that.

Assets recognized from paid and accrued premium tax offsets and policy
	surcharges prior year-end		$	5,231,427
Decreases current year:
	Premium tax offset applied		$	855,930
	Reduction in the estimated liability based on the new projections
		at the end of the current year		215,919
	Payments on insolvencies set up as payable prior to current year			365,302
Increases current year:
	Assessment payments less refunds on insolvencies billed during the
		current year	$	418,229
	Adjustment to remove payments on insolvences			17,065

Assets recognized from paid and accrued premium tax offsets and policy			$	4,229,571
	surcharges current year end

(20)	Subsequent Events

The Company has evaluated events subsequent to December 31, 2018 and through April 19, 2019, the date on which the audited financial statements were issued.

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Schedule I – Summary of Investments – Other than Investments in Related Parties

December 31, 2018

	Type of investment		Cost		Fair Value		Amount at which shown in the balance sheet

Bonds:
	United States Government and government agencies and authorities	$	3,787,889	$	3,988,672	$	3,787,889
	Special Revenue		420,553,110		402,123,753		420,553,110
	States, municipalities and political subdivisions		467,834,029		491,712,239		467,834,029
	Foreign governments		28,159,997		29,375,170		28,159,997
	All other corporate bonds¹		3,172,140,214		3,154,890,991		3,171,733,193
	SVO Identified Funds		24,807,441		23,183,382		23,183,382
	Total Bonds:		4,117,282,680		4,105,274,207		4,115,251,600
Equity securities:
	Preferred stock	$	4,211,220	$	4,628,588	$	4,211,220
	Common stock - unaffiliated		12,581,365		23,322,478		23,322,478
	Total equity securities:		16,792,585		27,951,066		27,533,698

Mortgage loans on real estate			484,256,052		490,749,585		484,256,052
Real estate			24,071,571		24,071,571		24,071,571
Cash and short-term investments			336,915,573		336,915,573		336,915,573
Contract loans			56,675,209		56,675,209		56,675,209
Other long-term investments			16,396,502		18,992,895		16,396,502
Receivable for securities			645,050		645,050		645,050
	Total investments	$	5,053,035,222	$	5,061,275,156	$	5,061,745,255

¹The amount shown on the balance sheet for NAIC 6 bonds are presented at fair value as fair value is lower than cost

See accompanying independent auditors’ report.

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY

Schedule III – Supplementary Insurance Information

December 31, 2018

(In thousands)
		As of December 31,				For the years ended December 31,
Segment		Deferred policy acquisition cost (1)	Future policy benefits losses, claims and loss expenses (3)	Unearned premiums (3)	Other policy claims and benefits payable (3)	Premium revenue and annuity, pension and other contract considerations	Net investment income	Benefits, claims, losses and settlement expenses	Amortization of deferred policy acquisition costs (1)	Other operating expense	Premiums written (2)
2018:
	Life	—	$455,009	—	$10,615	$123,588	$59,575	$36,864	—	$69,519	—
	Annuity	—	$1,958,643	—	—	$228,750	$85,605	$183,781	—	$23,074	—
	Supplementary
	Contract	—	$691	—	$139	—	$30	—	—	—	—
	Accident and
	Health	—	$702,795	$6,211	$116,823	$739,319	$39,750	$368,901	—	$382,888	—
Total		—	$3,117,138	$6,211	$127,577	$1,091,657	$184,960	$589,546	—	$475,481	—

2017:
	Life	—	$447,837	—	$17,282	$117,845	$59,874	$32,589	—	$57,854	—
	Annuity	—	$1,879,503	—	—	$159,169	$81,476	$122,750	—	$19,801	—
	Supplementary
	Contract	—	$712	—	$96	—	$30	—	—	—	—
	Accident and
	Health	—	$655,307	$6,201	$106,143	$680,365	$36,687	$319,680	—	$329,750	—
Total		—	$2,983,359	$6,201	$123,521	$957,379	$178,067	$475,019	—	$407,405	—

2016:
	Life	—	$416,680	—	$19,999	$103,402	$63,698	$38,971	—	$48,045	—
	Annuity	—	$1,786,814	—	—	$165,731	$79,779	$104,341	—	$19,381	—
	Supplementary
	Contract	—	$739	—	$93	—	$30	—	—	—	—
	Accident and
	Health	—	$598,138	$4,925	$120,974	$637,451	$31,986	$279,480	—	$296,634	—
Total		—	$2,802,371	$4,925	$141,066	$906,584	$175,493	$422,792	—	$364,060	—

(1)	Does not apply to financial statements of life insurance companies which are prepared on a statutory basis.
(2)	Does not apply to life insurance.
(3)	Advance premiums and other deposit funds are included in other policy claims and benefits payable.
See accompanying independent auditors' report

(continued)

AMERICAN FIDELITY ASSURANCE COMPANY AND SUBSIDIARIES

Schedule IV – Reinsurance

December 31, 2018

(In thousands)
								Percentage
					Ceded	Assumed		of amount
				Gross	to other	from other	Net	assumed
				amount	companies	companies	amount	to net
Year ended December 31, 2018:
Life insurance in force			$	28,719,190	7,759,347	—	20,959,843	—%
Premiums:
	Life insurance		$	398,011	45,673	—	352,338	—%
	Accident and health insurance			848,564	161,891	52,646	739,319	7.12%
		Total premiums	$	1,246,575	207,564	52,646	1,091,657	4.82%
Year ended December 31, 2017:
Life insurance in force			$	27,370,623	8,166,721	—	19,203,902	N/A
Premiums:
	Life insurance		$	324,070	47,055	—	277,014	N/A
	Accident and health insurance			805,585	175,349	50,129	680,365	7.37%
		Total premiums	$	1,129,655	222,404	50,129	957,379	5.24%
Year ended December 31, 2016:
Life insurance in force			$	25,265,829	8,556,920	—	16,708,909	N/A
Premiums:
	Life insurance		$	317,440	48,308	1	269,133	0.00%
	Accident and health insurance			754,042	161,358	44,767	637,451	7.02%
		Total premiums	$	1,071,482	209,666	44,768	906,584	4.94%
See accompanying independent auditors’ report.

PART C

OTHER INFORMATION

ITEM 24 -- FINANCIAL STATEMENTS AND EXHIBITS

(a) Financial Statements

The following financial statements are included in Part B of this registration statement:

AMERICAN FIDELITY SEPARATE ACCOUNT A

Report of Independent Registered Public Accounting Firm

Statement of Assets and Liabilities as of December 31, 2018

Statement of Operations for the Year Ended December 31, 2018

Statement of Changes in Net Assets for the Years Ended December 31, 2018 and 2017

Financial Highlights

Notes to Financial Statements

AMERICAN FIDELITY ASSURANCE COMPANY AND SUBSIDIARIES

Report of Independent Registered Public Accounting Firm

Consolidated Balance Sheets as of December 31, 2018 and 2017

Consolidated Statements of Income for the Years Ended December 31, 2018, 2017 and 2016

Consolidated Statements of Comprehensive Income (Loss) for the Years Ended December 31, 2018, 2017 and 2016

Consolidated Statements of Stockholder’s Equity for the Years Ended December 31, 2018, 2017 and 2016

Consolidated Statements of Cash Flows for the Years Ended December 31, 2018, 2017 and 2016

Notes to Consolidated Financial Statements

Schedule III - Supplementary Insurance Information

Schedule IV - Reinsurance

(b) Exhibits

Exhibit

Number

1.1	-	Resolution adopted by the Board of Directors of American Fidelity Assurance Company on May 7, 1968, authorizing establishment of the Registrant. Incorporated by reference to Exhibit 1.1 to Post-Effective Amendment No. 43 to Registrant’s registration statement on Form N-4 filed on November 25, 1998.
1.2	-	Resolution adopted by the Board of Directors of American Fidelity Assurance Company on April 6, 1998, authorizing reorganization of the Registrant as a unit investment trust. Incorporated by reference to Exhibit 1.2 to Post-Effective Amendment No. 43 to Registrant’s registration statement on Form N-4 filed on November 25, 1998.
1.3	-	Resolution adopted by the Board of Managers of the Registrant on March 19, 1998, authorizing reorganization of the Registrant as a unit investment trust. Incorporated by reference to Exhibit 1.3 to Post-Effective Amendment No. 43 to Registrant’s registration statement on Form N-4 filed on November 25, 1998.
3	-	Amended and Restated Principal Underwriter’s Agreement between the Registrant, American Fidelity Securities, Inc. and American Fidelity Assurance Company, effective as of June 10, 2006. Incorporated by reference to Exhibit 3 to Post-Effective Amendment No. 55 to Registrant’s registration statement on Form N-4 filed on April 30, 2007.

C-1

3.1	-	First Amendment to Amended and Restated Principal Underwriter’s Agreement between American Fidelity Assurance Company, on behalf of the Registrant, and American Fidelity Securities, Inc. dated June 10, 2009. Incorporated by reference to Exhibit 3.1 to Registrant’s Registration Statement on Post-Effective Amendment No. 66 to Form N-4 filed on April 27, 2018.
3.2	-	Second Amendment to Amended and Restated Principal Underwriter’s Agreement between American Fidelity Assurance Company, on behalf of the Registrant, and American Fidelity Securities, Inc. dated April 20, 2012. Incorporated by reference to Exhibit 3.1 to Post-Effective Amendment No. 60 to Registrant’s registration statement on Form N-4 filed on April 30, 2012.
3.3	-	Third Amendment to Amended and Restated Principal Underwriter’s Agreement between American Fidelity Assurance Company, on behalf of the Registrant, and American Fidelity Securities, Inc. dated June 10, 2015. Incorporated by reference to Exhibit 3.3 to Registrant’s Registration Statement on Post-Effective Amendment No. 66 to Form N-4 filed on April 27, 2018.
4.1	-	Form of Variable Annuity Master Contract. Incorporated by reference to Exhibit 4.1 to Post-Effective Amendment No. 43 to Registrant’s registration statement on Form N-4 filed on November 25, 1998.
4.2	-	Form of Variable Annuity Contract Certificate. Incorporated by reference to Exhibit 4.2 to Post-Effective Amendment No. 43 to Registrant’s registration statement on Form N-4 filed on November 25, 1998.
5	-	Forms of Variable Annuity Application. Incorporated by reference to Exhibit 5 to Post- Effective Amendment No. 43 to Registrant’s registration statement on Form N-4 filed on November 25, 1998.
6.1	-	Articles of Incorporation of American Fidelity Assurance Company, as amended. Incorporated by reference to Exhibit 6.1 to Post-Effective Amendment No. 43 to Registrant’s registration statement on Form N-4 filed on November 25, 1998.
6.2	-	Amended and Restated Bylaws of American Fidelity Assurance Company dated November 24, 1997. Incorporated by reference to Exhibit 8.2 to Post-Effective Amendment No. 42 to Registrant’s registration statement on Form N-4 filed on April 24, 1998.
8.1	-	Participation Agreement among Vanguard Variable Insurance Fund and The Vanguard Group, Inc. and Vanguard Marketing Corporation and American Fidelity Assurance Company dated March 30, 2005. Incorporated by reference to Exhibit 8.1 to Post-Effective Amendment No. 63 to Registrant’s registration statement on Form N-4 filed on April 30, 2015
8.2	-	Amendment to Participation Agreement (22c-2 Agreement) dated July 12, 2006 to Participation Agreement dated March 30, 2005 by and among Vanguard Variable Insurance Fund, The Vanguard Group, Inc., Vanguard Marketing Corporation and American Fidelity Assurance Company. Incorporated by reference to Exhibit 8.2 to Post-Effective Amendment No. 63 to Registrant’s registration statement on Form N-4 filed on April 30, 2015
8.3	-	Second Amendment to Participation Agreement by and among Vanguard Variable Insurance Fund, The Vanguard Group, Inc., Vanguard Marketing Corporation and American Fidelity Assurance Company dated April 13, 2010. Assurance Company. Incorporated by reference to Exhibit 8.3 to Post-Effective Amendment No. 63 to Registrant’s registration statement on Form N-4 filed on April 30, 2015

C-2

8.4	-	Amendments dated January 2, 2014 to Schedules A and B of Participation Agreement among Vanguard^® Variable Insurance Fund, The Vanguard Group, Inc., Vanguard Marketing Corporation and American Fidelity Assurance Company dated March 30, 2005, as amended. Incorporated by reference to Exhibit 8.4 to Post-Effective Amendment No. 63 to Registrant’s registration statement on Form N-4 filed on April 30, 2015.
8.5		Amended and Restated Investment Consultant Agreement effective October 30, 2017 between American Fidelity Assurance Company and InvesTrust Consulting, L.L.C. Incorporated by reference to Exhibit 8.5 to Registrant’s Registration Statement on Post-Effective Amendment No. 66 to Form N-4 filed on April 27, 2018.
9*	-	Opinion and Consent of Counsel.
10*	-	Consent of Independent Registered Public Accounting Firm.
99*	-	Relationship chart
*		Filed herewith.

C-3

ITEM 25 -- DIRECTORS AND OFFICERS OF THE DEPOSITOR

The following are the executive officers and directors of American Fidelity Assurance Company (“AFA”):

Name and Business Address		Positions and Offices with AFA
Gregory S. Allen 1515 London Road Charlottesville, Virginia 22901		Director
John M. Bendheim, Jr. 361 Canon Drive Beverly Hills, California 90210		Director
Ronald J. Byrne 9000 Cameron Parkway Oklahoma City, OK 73114		Senior Vice President
Lynda L. Cameron 9000 Cameron Parkway Oklahoma City, Oklahoma 73114		Director
William M. Cameron 9000 Cameron Parkway Oklahoma City, Oklahoma 73114		Chairman of the Board, Chief Executive Officer, Director
John Cassil 9000 Cameron Parkway Oklahoma City, OK 73114		Senior Vice President, Chief Financial Officer, Treasurer
William E. Durrett 9000 Cameron Parkway Oklahoma City, Oklahoma 73114		Senior Chairman of the Board, Director
Charles R. Eitel 2209 Miramonte Court Naples, Florida 34105		Director
Theodore M. Elam 10^th Floor, Two Leadership Square 211 North Robinson Oklahoma City, Oklahoma 73102		Director
Lynn Fritz 3909 Frei Road Sebastopol, CA 95472		Director
Christopher T. Kenney 9000 Cameron Parkway Oklahoma City, Oklahoma 73114		Senior Vice President, General Counsel, Secretary
Paula Marshall 2727 East 11^th Street Tulsa, Oklahoma 74104		Director
Tom J. McDaniel 9000 Cameron Parkway Oklahoma City, OK 73114		Director
Stephen M. Prescott, M.D. 825 N.E. 13^th St. Oklahoma City, OK 73104		Director
Jeanette Rice 9000 Cameron Parkway Oklahoma City, Oklahoma 73114		President, Chief Operations Officer
Gary E. Tredway 9000 Cameron Parkway Oklahoma City, OK 73114		Executive Vice President

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ITEM 26 -- PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH THE DEPOSITOR OR REGISTRANT

A relationship chart is included as Exhibit 99. The subsidiaries of American Fidelity Assurance Company reflected in the chart are included in the consolidated financial statements of American Fidelity Assurance Company in accordance with generally accepted accounting principles.

ITEM 27 -- NUMBER OF CONTRACT OWNERS

As of March 31, 2019, there were 7,380 owners of qualified contracts offered by Separate Account A and no owners of non-qualified contracts offered by Separate Account A.

ITEM 28 -- INDEMNIFICATION

The Bylaws of American Fidelity Assurance Company (Article VIII, Section 3) provide, in part, that:

(a) American Fidelity Assurance Company shall indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending, or completed action, suit, or proceeding, whether civil, criminal, administrative, or investigative (other than an action by or in the right of American Fidelity Assurance Company) by reason of the fact that he is or was a director, officer, employee, or agent of another corporation, partnership, joint venture, trust, or other enterprise, against expenses (including attorneys’ fees), amounts paid in settlement (whether with or without court approval), judgments, fines actually and reasonably incurred by him in connection with such action, suit, or proceeding if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of American Fidelity Assurance Company, and, with respect to any criminal action or proceeding, had reasonable cause to believe that his conduct was not unlawful.

(b) American Fidelity Assurance Company shall indemnify every person who is or was a party or is or was threatened to be made a party to any threatened, pending, or completed action or suit by or in the right of American Fidelity Assurance Company to procure a judgment in its favor by reason of the fact that he is or was a director, officer, employee, or agent of American Fidelity Assurance Company, or is or was serving at the request of American Fidelity Assurance Company as a director, officer, employee, or agent or in any other capacity of or in another corporation, or a partnership, joint venture, trust, or other enterprise, or by reason of any action alleged to have been taken or not taken by him while acting in such capacity, against expenses (including attorneys’ fees) actually and reasonably incurred by him in connection with the defense or settlement of such threatened, pending, or completed action or suit if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of American Fidelity Assurance Company. The termination of any such threatened or actual action or suit by a settlement or by an adverse judgment or order shall not of itself create a presumption that the person did not act in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of American Fidelity Assurance Company. Nevertheless, there shall be no indemnification with respect to expenses incurred in connection with any claim, issue, or matter as to which such person shall have been adjudged to be liable for negligence or misconduct in the performance of his duty to American Fidelity Assurance Company, unless, and only to the extent that the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses as such court shall deem proper.

(c) To the extent that a director, officer, employee, or agent of a corporation has been successful on the merits or otherwise in defense of any action, suit, or proceeding referred to in Subsections (a) and (b) hereof, or in defense of any claim, issue, or matter therein, he shall be indemnified against expenses (including attorneys’ fees) actually and reasonably incurred by him in connection with such defense.

Insofar as indemnification for liability arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

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ITEM 29 -- PRINCIPAL UNDERWRITERS

(a) American Fidelity Securities, Inc. is the sole underwriter for American Fidelity Separate Account A, American Fidelity Separate Account B and American Fidelity Separate Account C.

(b) The following persons are the officers and directors of American Fidelity Securities. The principal business address for each of the following officers and directors is 9000 Cameron Parkway, Oklahoma City, Oklahoma 73114.

Name and Principal Business Address		Positions and Offices with Underwriter
Timothy H. Bolden		Director, Vice-President AML; Investment Company and Variable Contract Products Principal
Sal Cristofaro		Chief Operations Officer; Investment Company and Variable Contract Products Principal
Rafael Garcia		Director; Investment Company and Variable Contract Products Principal
Cherie L. Horsfall		Assistant Vice President; Investment Company and Variable Contract Products Principal
Christopher T. Kenney		Director, Chairman of the Board, Chief Executive Officer and President; Investment Company and Variable Contract Products Principal
Linda Overfield		Assistant Vice President AML, Privacy and Licensing; Investment Company and Variable Contract Products Principal
Jennifer Wheeler		Vice President, Chief Compliance Officer and Secretary; Investment Company and Variable Contract Products Principal
Shirley K. Williams		Assistant Vice President, Chief Financial Officer and Treasurer; Financial and Operations Principal

(c) The net underwriting discounts and commissions received by American Fidelity Securities, Inc. from the Registrant in 2018 were $65,457, representing the 3% sales fee deducted from purchase payments to the Registrant. It received no other commission or compensation from or on behalf of the Registrant during the year.

ITEM 30 -- LOCATION OF ACCOUNTS AND RECORDS

This information is included in the Registrant’s most recent report on Form N-CEN.

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ITEM 31 -- MANAGEMENT SERVICES

Not applicable.

ITEM 32 -- UNDERTAKINGS

UNDERTAKINGS

The Registrant hereby undertakes to:

(a)	file a post-effective amendment to this registration statement as frequently as is necessary to ensure that the audited financial statements in the registration statement are never more than 16 months old for so long as payments under the variable annuity contracts may be accepted;

(b)

include either (1) as part of any application to purchase a contract offered by the Prospectus, a space that an applicant can check to request a Statement of Additional Information, or (2) a postcard or similar written communication affixed to or included in the Prospectus that the applicant can remove to send for a Statement of Additional Information; and

(c)	deliver any Statement of Additional Information and any financial statements required to be made available under this Form promptly upon written or oral request.

REPRESENTATIONS

American Fidelity Assurance Company hereby represents that the fees and charges deducted under the Variable Annuity Contract, in the aggregate, are reasonable in relation to the services rendered, the expenses expected to be incurred, and the risks assumed by American Fidelity Assurance Company.

American Fidelity Assurance Company hereby represents that it is relying upon a No-Action Letter issued to the American Council of Life Insurance dated November 28, 1988 (Commission ref. IP-6-88) and that American Fidelity Assurance Company has:

1. Included appropriate disclosure regarding the redemption restrictions imposed by Section 403(b)(11) in each registration statement, including the prospectus, used in connection with the offer of the contract;

2. Included appropriate disclosure regarding the redemption restrictions imposed by Section 403(b)(11) in any sales literature used in connection with the offer of the contract;

3. Instructed sales representatives who solicit participants to purchase the contract specifically to bring the redemption restrictions imposed by Section 403(b)(11) to the attention of the potential participants;

4. Obtained from each plan participant who purchases a Section 403(b) annuity contract, prior to or at the time of such purchase, a signed statement acknowledging the participant’s understanding of (1) the restrictions on redemption imposed by Section 403(b)(11), and (2) other investment alternatives available under the employer’s Section 403(b) arrangement to which the participant may elect to transfer his contract value.

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SIGNATURES

As required by the Securities Act of 1933 and the Investment Company Act of 1940, the Registrant certifies that it meets all of the requirements for effectiveness under Rule 485(b) of the Securities Act and has caused this Registration Statement to be signed on its behalf, in the City of Oklahoma City and State of Oklahoma on April 16, 2019.

AMERICAN FIDELITY SEPARATE ACCOUNT A (Registrant)
By:	American Fidelity Assurance Company (Depositor)
By:	/s/ Ronald J. Byrne
	Ronald J. Byrne, Senior Vice President
AMERICAN FIDELITY ASSURANCE COMPANY (Depositor)
By:	/s/ Ronald J. Byrne
	Ronald J. Byrne, Senior Vice President

As required by the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities set for as of April 16, 2019. Each of the undersigned hereby appoints Ronald J. Byrne and Christopher T. Kenney, individually, as his/her true and lawful attorney-in-fact with full power to sign for him/her, in his/her name as officer or director, or both, of American Fidelity Assurance Company, a post-effective amendment to registration statement (and any and all amendments thereto, including additional post-effective amendments) on Form N-4 to be filed with the Securities and Exchange Commission, granting unto said attorney-in-fact and agent, full power and authority to do and to perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he/she might or could do in person, hereby ratifying and confirming all that said attorney-in-fact and agent, may lawfully do or cause to be done by virtue hereof.

Signature
/s/ Gregory S. Allen
Gregory S. Allen, Director		Lynn Fritz, Director
/s/ John M. Bendheim		/s/ Paula Marshall
John M. Bendheim, Director		Paula Marshall, Director
/s/ Ronald J. Byrne		/s/ Tom J. McDaniel
Ronald J. Byrne, Senior Vice President		Tom J. McDaniel, Director
/s/ Lynda L. Cameron		/s/ Stephen M. Prescott
Lynda L. Cameron, Director		Stephen M. Prescott, Director
/s/ William M. Cameron		/s/ Jeanette Rice
William M. Cameron, Chairman of the Board and Chief Executive Officer		Jeanette Rice, President and Chief Operations Officer (Principal Executive Officer)
/s/ John Cassil
John Cassil, Senior Vice President, Chief Financial Officer and Treasurer (Principal Financial and Accounting Officer)
/s/ William E. Durrett
William E. Durrett, Senior Chairman of the Board and Director
/s/ Charles R. Eitel
Charles R. Eitel, Director
/s/ Theodore M. Elam
Theodore M. Elam, Director

INDEX TO EXHIBITS

EXHIBIT NUMBER	DESCRIPTION	METHOD OF FILING
1.1	Resolution adopted by the Board of Directors of American Fidelity Assurance Company on May 7, 1968, authorizing establishment of the Registrant.	Incorporated by reference
1.2	Resolution adopted by the Board of Directors of American Fidelity Assurance Company on April 6, 1998, authorizing reorganization of the Registrant as a unit investment trust.	Incorporated by reference
1.3	Resolution adopted by the Board of Managers of the Registrant on March 19, 1998, authorizing reorganization of the Registrant as a unit investment trust.	Incorporated by reference
3	Amended and Restated Principal Underwriter’s Agreement between the Registrant, American Fidelity Securities, Inc. and American Fidelity Assurance Company, effective as of July 10, 2006.	Incorporated by reference
3.1	First Amendment to Amended and Restated Principal Underwriter’s Agreement between American Fidelity Assurance Company, on behalf of the Registrant, and American Fidelity Securities, Inc. dated June 10, 2009.	Incorporated by reference
3.2	Second Amendment to Amended and Restated Principal Underwriter’s Agreement between American Fidelity Assurance Company, on behalf of the Registrant, and American Fidelity Securities, Inc. dated April 20, 2012.	Incorporated by reference
3.3	Third Amendment to Amended and Restated Principal Underwriter’s Agreement between American Fidelity Assurance Company, on behalf of the Registrant, and American Fidelity Securities, Inc. dated June 10, 2015.	Incorporated by reference
4.1	Form of Variable Annuity Master Contract.	Incorporated by reference
4.2	Form of Variable Annuity Contract Certificate.	Incorporated by reference
5	Forms of Variable Annuity Application.	Incorporated by reference
6.1	Articles of Incorporation of American Fidelity Assurance Company, as amended.	Incorporated by reference
6.2	Amended and Restated Bylaws of American Fidelity Assurance Company dated November 24, 1997.	Incorporated by reference
8.1	Participation Agreement among Vanguard Variable Insurance Fund and The Vanguard Group, Inc. and Vanguard Marketing Corporation and American Fidelity Assurance Company dated March 30, 2005.	Incorporated by reference
8.2	Amendment to Participation Agreement (22c-2 Agreement) dated July 12, 2006 to Participation Agreement dated March 30, 2015 by and among Vanguard Variable Insurance Fund, The Vanguard Group, Inc., Vanguard Marketing Corporation and American Fidelity Assurance Company.	Incorporated by reference
8.3	Second Amendment to Participation Agreement by and among Vanguard Variable Insurance Fund, The Vanguard Group, Inc., Vanguard Marketing Corporation and American Fidelity Assurance Company dated April 13, 2010.	Incorporated by reference

8.4	Amendments dated January 2, 2014 to Schedules A and B of Participation Agreement among Vanguard^® Variable Insurance Fund, The Vanguard Group, Inc., Vanguard Marketing Corporation and American Fidelity Assurance Company dated March 30, 2005, as amended.	Incorporated by reference
8.5	Amended and Restated Investment Consultant Agreement effective October 30, 2017 between American Fidelity Assurance Company and InvesTrust Consulting, L.L.C.	Incorporated by reference
9	Opinion and Consent of Counsel.	Filed herewith
10	Consent of Independent Registered Public Accounting Firm.	Filed herewith
99	Relationship chart.	Filed herewith