PRESS RELEASE

Automobile Protection Corporation Announces Charge Related to its Litigation Against Everest Reinsurance Company (Formerly Prudential Reinsurance Company)

5 February 1997

    ATLANTA, Feb. 5 -- Automobile Protection Corporation
(APCO) announced today that it will record a pre-tax charge in
the range of $750,000 to $1 million in connection with its litigation against
Everest Reinsurance Company (formerly Prudential Reinsurance
Company).
    Anthony R. Levinson, Chief Financial Officer stated:  "In our third
quarter 10-Q and our preliminary fourth quarter earnings announcement, we
disclosed that we filed a complaint against Everest Reinsurance Company for
their improper denial of claims on assumption of liability endorsements issued
to our dealers in 1991.  We are vigorously pursuing this litigation against
Everest and strongly believe the facts of the litigation are in our favor.
However, we recognize that the litigation could take a few years to resolve
and the Company's Board of Directors believes that the prudent course of
action is to take a one-time charge now.  Through December 31, 1996, to
preserve our relationships with dealers who relied upon us to obtain insurance
protection, we have paid $225,000 of claims and are in the process of
actuarially determining the future claims which we expect to pay.  It is
expected that we will record the reserve in our December 31, 1996 financial
reporting period.
    APCO prides itself in being a high quality organization and will stand by
its dealers and their customers.  Although the Company will continue to pay
these claims, this action by the Company in no way diminishes the Company's
resolve to fully pursue its rights against Everest.  Should the Company
succeed legally, the amount reserved will be recovered in a future period.
The contracts insured by Everest relate to a short period of time and do not
impact our current programs at all.  APCO has the financial resources to pay
these claims and, at December 31, 1996, had approximately $15 million of cash
and investments, no debt and stockholder's equity of $19 million after the
onetime charge for this litigation."
    Certain statements in this announcement, including the estimate of amounts
to be paid to dealers in the future for which a reserve is being established,
set forth management's intentions, plans, beliefs, expectations or predictions
of the future based on current facts and analyses.  Actual results may differ
materially from those indicated in such statements.  Additional information on
factors that may affect the business and financial results of the Company can
be found in the other filings of the Company with the Securities and Exchange
Commission, specifically Form 1O-K for the year ended December 31, 1995.
    APCO, established in 1984, and its subsidiary, The Aegis Group, Inc., are
leading marketers and administrators of products and services to automobile
dealers which are designed to enhance customer satisfaction and dealership
profitability.  The Company's core business is the marketing and
administration of the EasyCare(R) Certified PreOwned Vehicle Program and
Vehicle Service Contracts.  The Company also provides insurance brokerage
services for automobile dealers and others in the automotive industry.
    Other APCO press releases are available through Company News On-Call by
fax, 800-758-5804, ext. 100756.  The Company's Internet address is
http://www.easycare.com.

SOURCE  Automobile Protection Corporation