UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


                                    FORM 10-Q


         [X]   Quarterly Report Pursuant To Section 13 Or 15(d) Of The
         Securities Exchange Act Of 1934 For the quarterly period ended March
         31, 2002
         OR
         [ ]   Transition Report Pursuant To Section 13 Or 15(d) Of The
         Securities Exchange Act Of 1934
         For the transition period from                    to
                                        ------------------    ------------------

                         Commission File Number 1-13154


                      AMERICAN MEDICAL SECURITY GROUP, INC.
             (Exact name of Registrant as specified in its charter)

         Wisconsin                                     39-1431799
  (State of Incorporation)                  (I.R.S. Employer Identification No.)

         3100 AMS Boulevard
        Green Bay, Wisconsin                              54313
 (Address of principal executive offices)               (Zip Code)


Registrant's telephone number, including area code:  (920) 661-1111



Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.

           Yes __X__        No _____

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.

Common stock, no par value, outstanding as of April 30, 2002:  12,590,166 shares

<PAGE>








                      AMERICAN MEDICAL SECURITY GROUP, INC.

                                      INDEX


Part I.   FINANCIAL INFORMATION

 Item 1.  Financial Statements (Unaudited)

          Condensed Consolidated Balance Sheets
              March 31, 2002 and December 31, 2001.............................3

          Condensed Consolidated Statements of Operations
              Three months ended March 31, 2002 and 2001.......................5

          Condensed Consolidated Statements of Cash Flows
              Three months ended March 31, 2002 and 2001.......................6

          Notes to Condensed Consolidated Financial Statements
              March 31, 2002...................................................7

 Item 2.  Management's Discussion and Analysis of Financial Condition and
              Results of Operations...........................................13

 Item 3.  Quantitative and Qualitative Disclosures About Market Risk..........17


Part II.  OTHER INFORMATION

 Item 1.  Legal Proceedings...................................................18

 Item 6.  Exhibits and Reports on Form 8-K....................................19

 Signatures...................................................................20

 Exhibit Index..............................................................EX-1


                                                                               2
<PAGE>





PART I.   FINANCIAL INFORMATION

ITEM 1.   FINANCIAL STATEMENTS


                      AMERICAN MEDICAL SECURITY GROUP, INC.

                      CONDENSED CONSOLIDATED BALANCE SHEETS
                                   (Unaudited)



                                                    March 31,       December 31,
                                                      2002             2001
                                                  ------------------------------
                                                          (In thousands)

ASSETS

Investments:
   Securities available for sale, at fair value:
     Fixed maturities                             $    250,217      $   269,753
     Equity securities-preferred                             -              722
   Fixed maturity securities held to maturity,
   at amortized cost                                     4,303            4,286
   Trading securities, at fair value                       666              517
                                                  ------------------------------

       Total investments                               255,186          275,278

Cash and cash equivalents                               17,604           24,975

Other assets:
   Property and equipment, net                          34,460           33,381
   Goodwill, net                                        92,944          100,343
   Other intangibles, net                                3,408            3,591
   Other assets                                         44,744           35,447
                                                  ------------------------------

       Total other assets                              175,556          172,762
                                                  ------------------------------

Total assets                                      $    448,346      $   473,015
                                                  ==============================







            See Notes to Condensed Consolidated Financial Statements

                                                                               3
<PAGE>



                      AMERICAN MEDICAL SECURITY GROUP, INC.

                      CONDENSED CONSOLIDATED BALANCE SHEETS
                                   (Unaudited)


                                                    March 31,       December 31,
                                                       2002             2001
                                                  ------------------------------
                                                          (In thousands)

LIABILITIES AND SHAREHOLDERS' EQUITY

Liabilities:
   Medical and other benefits payable             $    132,569      $   135,504
   Advance premiums                                     16,634           16,737
   Payables and accrued expenses                        26,656           28,032
   Notes payable                                        34,758           40,058
   Other liabilities                                    24,154           23,284
                                                  ------------------------------

       Total liabilities                               234,771          243,615

Shareholders' equity:
   Common stock (no par value, $1 stated value,
     50,000,000 shares authorized, 16,654,315
     issued and 12,590,166 outstanding at
     March 31, 2002, 16,654,315 issued and
     13,955,439 outstanding at December 31, 2001)       16,654           16,654
   Paid-in capital                                     187,892          187,927
   Retained earnings                                    45,900           40,470
   Accumulated other comprehensive income (loss)
     (net of tax benefit of $40,000 at March 31,
     2002 and tax expense of $1,024,000 at
     December 31, 2001)                                    (74)           1,903
   Treasury stock (4,064,149 shares at March 31,
     2002 and 2,698,876 shares at December 31,
     2001, at cost)                                    (36,797)         (17,554)
                                                  ------------------------------

       Total shareholders' equity                      213,575          229,400
                                                  ------------------------------

Total liabilities and shareholders' equity        $    448,346      $   473,015
                                                  ==============================









            See Notes to Condensed Consolidated Financial Statements

                                                                               4
<PAGE>



                      AMERICAN MEDICAL SECURITY GROUP, INC.

                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (Unaudited)


                                                        Three Months Ended
                                                              March 31,
                                                  ------------------------------
                                                      2002              2001
                                                  ------------------------------
                                                 (In thousands, except per share
                                                                data)
Revenues:
   Insurance premiums                             $    194,401      $   222,470
   Net investment income                                 3,924            4,514
   Net realized investment gain (loss)                      14              (27)
   Other revenue                                         5,405            5,301
                                                  ------------------------------
       Total revenues                                  203,744          232,258

Expenses:
   Medical and other benefits                          131,800          166,580
   Selling, general and administrative                  62,024           71,411
   Interest expense                                        494              876
   Amortization of goodwill and intangibles                183              907
                                                  ------------------------------
       Total expenses                                  194,501          239,774
                                                  ------------------------------

Income (loss) before income taxes                        9,243           (7,516)

Income tax expense (benefit)                             3,813           (2,376)
                                                  ------------------------------

Net income (loss)                                 $      5,430      $    (5,140)
                                                  ==============================


Earnings (loss) per common share:
   Basic                                          $       0.39      $     (0.36)
   Diluted                                        $       0.37      $     (0.36)









            See Notes to Condensed Consolidated Financial Statements

                                                                               5
<PAGE>



                      AMERICAN MEDICAL SECURITY GROUP, INC.

                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)


                                                        Three Months Ended
                                                              March 31,
                                                  ------------------------------
                                                      2002              2001
                                                  ------------------------------
                                                           (In thousands)
OPERATING ACTIVITIES:
Net income (loss)                                 $      5,430      $    (5,140)
Adjustments to reconcile net income (loss) to net
   cash provided by (used in) operating
   activities:
     Depreciation and amortization                       2,226            2,427
     Net realized investment (gain) loss                   (14)              27
     Net change in trading securities                     (149)              16
     Deferred income tax benefit                        (2,694)          (2,571)
     Changes in operating accounts:
       Other assets                                      1,870            1,408
       Medical and other benefits payable               (2,935)         (12,025)
       Advance premiums                                   (103)             445
       Payables and accrued expenses                    (1,376)           8,237
       Other liabilities                                   860             (880)
                                                  ------------------------------
         Net cash provided by (used in) operating
           activities                                    3,115           (8,056)


INVESTING ACTIVITIES:
Purchases of available for sale securities             (32,283)         (40,470)
Proceeds from sale of available for sale securities     49,214           43,679
Proceeds from maturity of available for sale
  securities                                                 -            3,050
Purchases of held to maturity securities                (1,335)               -
Proceeds from maturity of held to maturity
  securities                                             1,295                -
Purchases of property and equipment                     (2,799)          (1,891)
                                                  ------------------------------
         Net cash provided by investing activities      14,092            4,368


FINANCING ACTIVITIES:
Purchase of treasury stock                             (19,540)          (1,134)
Stock options exercised                                    262                -
Repayment of notes payable                              (5,300)            (300)
                                                  ------------------------------
         Net cash used in financing activities         (24,578)          (1,434)
                                                  ------------------------------

Cash and cash equivalents:
   Net decrease                                         (7,371)          (5,122)
   Balance at beginning of year                         24,975           15,606
                                                  ------------------------------
Balance at end of period                          $     17,604      $    10,484
                                                  ==============================



            See Notes to Condensed Consolidated Financial Statements

                                                                               6
<PAGE>






                      AMERICAN MEDICAL SECURITY GROUP, INC.

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)


                                 March 31, 2002


NOTE A.       BASIS OF PRESENTATION

         The accompanying unaudited condensed consolidated financial statements
have been prepared in accordance with accounting principles generally accepted
in the United States for interim financial information and with the instructions
to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include
all of the information and footnotes required by accounting principles generally
accepted in the United States ("GAAP") for complete financial statements. In the
opinion of management, all adjustments (consisting of normal recurring
adjustments) considered necessary for a fair presentation have been included.
Operating results for the three months ended March 31, 2002 are not necessarily
indicative of the results that may be expected for the year ending December 31,
2002. These condensed consolidated financial statements should be read in
conjunction with the consolidated financial statements and footnotes thereto
included in the American Medical Security Group, Inc. (the "Company") annual
report on Form 10-K for the year ended December 31, 2001.

NOTE B.       EARNINGS (LOSS) PER COMMON SHARE ("EPS")

         Basic EPS are computed by dividing net income (loss) by the weighted
average number of common shares outstanding. Diluted EPS are computed by
dividing net income (loss) by the weighted average number of common shares
outstanding, adjusted for the effect of dilutive employee stock options.

         The following table illustrates the computation of EPS and provides a
reconciliation of the number of weighted average basic and diluted shares
outstanding:


                                                        Three Months Ended
                                                             March 31,
                                                  ------------------------------
                                                      2002              2001
                                                  ------------------------------
                                                 (In thousands, except share and
                                                          per share data)
     Numerator:
        Net income (loss)                         $      5,430      $    (5,140)
                                                  ==============================

     Denominator:
        Denominator for basic EPS - weighted
          average shares                            13,802,666       14,210,643
        Effect of dilutive employee stock options      688,875                -
                                                  ------------------------------
        Denominator for diluted EPS                 14,491,541       14,210,643
                                                  ==============================

     Earnings (loss) per common share:
        Basic                                     $       0.39      $     (0.36)
        Diluted                                   $       0.37      $     (0.36)


                                                                               7
<PAGE>


         The effect of dilutive securities was excluded from the diluted
earnings (loss) per common share computation for the three months ended March
31, 2001 because the Company had a net loss in that period; therefore, their
inclusion would have been antidilutive. Certain options to purchase shares were
not included in the computation of diluted earnings (loss) per common share
because the options' exercise prices were greater than the average market price
of the outstanding common shares for the period.

NOTE C.       COMPREHENSIVE INCOME (LOSS)

         Comprehensive income (loss) is defined as net income (loss) plus or
minus other comprehensive income (loss). For the Company, under existing
accounting standards, other comprehensive income (loss) includes unrealized
gains and losses, net of income tax effects, on certain investments in debt and
equity securities. Comprehensive income (loss) for the Company is calculated as
follows:

                                                        Three Months Ended
                                                             March 31,
                                                  ------------------------------
                                                      2002             2001
                                                  ------------------------------
                                                           (In thousands)
         Net income (loss)                        $      5,430     $     (5,140)

         Unrealized gain (loss) on available for
           sale securities                              (1,977)           3,392
                                                  ------------------------------

         Comprehensive income (loss)              $      3,453     $     (1,748)
                                                  ==============================

NOTE D.       CREDIT AGREEMENT

         At March 31, 2002, the Company maintained a revolving bank line of
credit agreement with an outstanding balance and maximum commitment of $30.2
million. At December 31, 2001, the outstanding balance and maximum commitment
under the credit agreement was $35.2 million. The credit agreement contains
customary covenants which, among other matters, require the Company to achieve
certain minimum financial results and restrict the Company's ability to incur
additional debt, pay future cash dividends and dispose of assets outside the
ordinary course of business. The Company was in compliance with all such
covenants at March 31, 2002 and anticipates continued compliance in the
foreseeable future. Obligations under the credit agreement are secured by the
stock of the Company's principal subsidiaries. The Company believes that the
implementation of Statement of Financial Accounting Standards No. 142, as
described in Note F below, will not adversely impact the Company's compliance
with its debt covenants.

         The credit agreement was amended in March 2002 to allow for the
repurchase on March 22, 2002, of 1.4 million shares of the Company's common
stock at a total cost of $19.5 million, including related transaction costs,
from the Company's largest shareholder, Blue Cross & Blue Shield United of
Wisconsin, and revise the minimum financial requirements under certain covenants
and the schedule of mandatory future commitment reductions.

NOTE E.       CONTINGENCIES

         In February 2000, a class action lawsuit was filed against the Company
in the state of Florida alleging the Company did not follow Florida law when it
discontinued writing certain health insurance policies and offered new policies
in 1998. Plaintiffs claim the Company wrongfully terminated policies, improperly
notified insureds of conversion rights and charged improper premiums for the new
policies. Plaintiffs also alleged that the Company's renewal rating methodology
violates Florida law. Plaintiffs are seeking unspecified damages. A bench trial
on the liability issues of the case was held in March 2002. On April 24, 2002, a
judgment was rendered against the Company and the damages portion of the lawsuit
is expected to be heard before a jury later this year. Management believes the
Company acted in compliance with applicable Florida law with regard to the
discontinuance and replacement of insurance policies and with regard to its
renewal rating practices.

                                                                               8
<PAGE>

         In a separate administrative proceeding based on similar facts with
similar issues, the Florida Department of Insurance issued a complaint against
the Company in May 2001, challenging the Company's rating and other practices in
Florida. On April 25, 2002, the Administrative Law Judge found in favor of the
Company and held that the evidence presented by the Florida Department of
Insurance did not support a conclusion that the Company had violated any
provisions of the Florida insurance statutes or regulations. The Administrative
Law Judge recommended that the administrative complaint be dismissed. The
Commissioner of the Florida Department of Insurance must accept the
Administrative Law Judge's findings of fact but may make modifications to
conclusions of law. In light of the conflicting findings in these cases, the
Company intends to request that the court in the class action lawsuit reconsider
its ruling. If the ruling is not reconsidered, the Company intends to appeal the
ruling.

         The Company is involved in the foregoing and various other legal and
regulatory actions occurring in the normal course of business. Based on current
information including consultation with outside counsel, management believes any
ultimate liability that may arise from the above-mentioned and all other legal
and regulatory actions would not materially affect the Company's consolidated
financial position or results of operations. However, management's evaluation of
the likely impact of these actions could change in the future and an unfavorable
outcome could have a material adverse effect on the Company's consolidated
financial position, results of operations or cash flow of a future period.

NOTE F.       RECENT ACCOUNTING PRONOUNCEMENTS

         On January 1, 2002, the Company adopted Statement of Financial
Accounting Standards No. 142, Goodwill and Other Intangible Assets ("Statement
142"). Statement 142 impacts the Company in two ways. First, goodwill is no
longer amortized. Second, goodwill is subject to an initial impairment test in
accordance with Statement 142, and any remaining balance of goodwill will be
subject to future annual impairment testing.

         Effective January 1, 2002, in accordance with Statement 142, the
Company reclassified an intangible asset, net of related deferred taxes, into
goodwill because it did not meet the new recognition criteria for an intangible
asset to be recognized apart from goodwill. The amortization period used prior
to 2002 for this intangible asset was the same as the amortization period for
goodwill.

         The Company's other intangible asset will continue to be amortized on a
straight-line basis over its remaining useful life of five years. This
intangible asset had a gross carrying amount of $7.3 million and accumulated
amortization of $3.7 million at December 31, 2001. Future amortization expense
for this intangible asset is expected to be approximately $0.7 million for each
of the next five years.

         The Company is in the process of performing the first of the required
impairment tests of goodwill by comparing the fair value of the Company's
reporting units to their carrying amounts (book value), including goodwill as of
January 1, 2002. At December 31, 2001, the Company's book value per share was
$16.30 and was significantly higher than the $12.45 quoted market price per
share. The Company has not yet determined what the effect of these tests will be
on the earnings and financial position of the Company. If management determines
that the quoted market price per share is the appropriate measure of the
Company's fair value, the resulting impairment would be greater than 50% of the
amount of goodwill on the Company's December 31, 2001 balance sheet. If it is
determined that an impairment exists as of January 1, 2002, the charge will be
reported as the cumulative effect of a change in accounting principle in the
Company's consolidated financial statements and will have no impact on cash
flows or the statutory-basis capital and surplus of the Company's insurance
subsidiaries.

                                                                               9
<PAGE>


         For comparative purposes, the following table illustrates net loss and
net loss per share for the first quarter of the prior year adjusted to exclude
the effects of adopting Statement 142:


                                                        Three Months Ended
                                                             March 31,
                                                  ------------------------------
                                                      2002              2001
                                                  ------------------------------
                                                      (In thousands, except
                                                        per share amounts)

         Reported net income (loss)               $      5,430      $    (5,140)
         Add back:  Goodwill amortization                   -               671
                                                  ------------------------------
         Adjusted net income (loss)               $      5,430      $    (4,469)
                                                  ==============================

         Basic earnings (loss) per common share:
            Reported net income (loss)            $       0.39      $     (0.36)
            Goodwill amortization                           -              0.05
                                                  ------------------------------
            Adjusted net income (loss)            $       0.39      $     (0.31)
                                                  ==============================


         Diluted earnings (loss) per common share:
            Reported net income (loss)            $       0.37      $     (0.36)
            Goodwill amortization                           -              0.05
                                                  ------------------------------
            Adjusted net income (loss)            $       0.37      $     (0.31)
                                                  ==============================

NOTE G.       SEGMENT INFORMATION

         The Company has two reportable segments: 1) health insurance products;
and 2) life insurance products. The Company's health insurance products consist
of the following coverages related to small employer group preferred provider
organization products: MedOneSM (for individuals and families) and small
employer group medical, self funded medical, dental and short-term disability.
Life insurance products consist primarily of group term-life insurance. The "All
Other" segment includes operations not directly related to the business segments
and unallocated corporate items (i.e., corporate investment income, interest
expense on corporate debt, amortization of goodwill and intangibles and
unallocated overhead expenses). The reportable segments are managed separately
because they differ in the nature of the products offered and in profit margins.

         The Company evaluates segment performance based on profit or loss
before income taxes, not including gains and losses on the Company's investment
portfolio. The accounting policies of the reportable segments are the same as
those used to report the Company's consolidated financial statements.
Significant intercompany transactions have been eliminated prior to reporting
reportable segment information.

                                                                              10
<PAGE>

         A reconciliation of segment income (loss) before income taxes to
consolidated income (loss) before income taxes is as follows:


                                                        Three Months Ended
                                                             March 31,
                                                  ------------------------------
                                                      2002             2001
                                                  ------------------------------
                                                          (In thousands)
         Health segment                           $      8,342     $     (8,506)
         Life segment                                    1,423            1,750
         All other                                        (522)            (760)
                                                  ------------------------------
            Income (loss) before income taxes     $      9,243     $     (7,516)
                                                  ==============================

         Operating results and statistics for each of the Company's segments are
as follows:

                                                        Three Months Ended
                                                             March 31,
                                                  ------------------------------
                                                      2002             2001
                                                  ------------------------------
                                                          (In thousands)
         HEALTH SEGMENT

         OPERATING RESULTS

         Revenues:
            Insurance premiums                    $    190,720     $    216,974
            Net investment income                        1,934            2,450
            Other revenue                                4,460            4,230
                                                  ------------------------------
              Total revenues                           197,114          223,654

         Expenses:
            Medical and other benefits                 130,564          164,197
            Selling, general and administrative         58,208           67,963
                                                  ------------------------------
              Total expenses                           188,772          232,160
                                                  ------------------------------

         Income (loss) before income taxes        $      8,342     $     (8,506)
                                                  ==============================

         FINANCIAL STATISTICS

         Loss ratio                                      68.5%            75.7%
         Expense ratio                                   28.2%            29.4%
                                                  ------------------------------
            Combined ratio                               96.7%           105.1%
                                                  ==============================


         Membership at End of Period:
         Health:
            Fully insured medical                      329,531          424,632
            Self funded medical                         43,128           49,260
            Stand-alone dental                         166,822          178,283
                                                  ------------------------------
              Total health (a)                         539,481          652,175

         (a)      Total health membership for the Company at March 31, 2001 of
                  652,683 includes health maintenance organization ("HMO")
                  membership of 508. HMO operations are not included in health
                  segment operating results.

                                                                              11
<PAGE>



                                                        Three Months Ended
                                                             March 31,
                                                  ------------------------------
                                                       2002             2001
                                                  ------------------------------
                                                          (In thousands)
         LIFE SEGMENT

         OPERATING RESULTS

         Revenues:
            Insurance premiums                    $      3,678     $      4,963
            Net investment income                          150              174
            Other revenue                                   32               42
                                                  ------------------------------
              Total revenues                             3,860            5,179

         Expenses:
            Medical and other benefits                   1,218            1,992
            Selling, general and administrative          1,219            1,437
                                                  ------------------------------
              Total expenses                             2,437            3,429
                                                  ------------------------------

         Income before income taxes               $      1,423     $      1,750
                                                  ==============================

         Financial Statistics

         Loss ratio                                      33.1%            40.1%
         Expense ratio                                   32.3%            28.1%
                                                  ------------------------------
            Combined ratio                               65.4%            68.2%
                                                  ==============================


         Membership at End of Period                   174,126          230,426


                                                                              12
<PAGE>


ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
          RESULTS OF OPERATIONS


OVERVIEW

         American Medical Security Group, Inc., together with its subsidiary
companies (the "Company"), is a provider of individual and small employer group
insurance products. The Company's principal product offerings are health
insurance for small employer groups and health insurance products marketed to
individuals and families ("MedOneSM"). The Company also offers dental, life,
prescription drug, disability and accidental death insurance, and provides self
funded benefit administration. The Company markets its products in 32 states and
the District of Columbia through independent agents. The Company has
approximately 75 sales managers located in sales offices throughout the United
States to support the independent agents. The Company's products generally
provide discounts to insureds that utilize preferred provider organizations
("PPOs"). The Company owns a preferred provider network and also contracts with
other networks to ensure cost-effective health care choices to its members.

RESULTS OF OPERATIONS

         The Company reported net income of $5.4 million or $0.37 per diluted
share for the first quarter of 2002. This compares to a net loss of $5.1 million
or $0.36 per share for the first quarter of 2001. The improvement in
profitability from the first quarter of the prior year primarily reflects
improvement in the small employer group loss ratio, a charge related to legal
matters in the first quarter of 2001, and a change in accounting for goodwill
and other intangible assets.

         The improvement in the small employer group loss ratio is attributed to
management's strategic plan including increased premium rates on new and renewal
business, focused marketing efforts for small employer group products in markets
with the best prospects for profitability and future growth, and redesigned
products to meet the changing needs of today's insurance consumers.

         The results for the first quarter of 2001 reflect an after-tax charge
of $5.8 million or $0.41 per share for legal matters related to an adverse
ruling in a lawsuit brought against the Company by Skilstaf, Inc. Effective
January 1, 2002, the Company adopted new rules on accounting for goodwill and
other intangible assets. Goodwill is no longer amortized, but is instead tested
annually for impairment. The first quarter 2001 results include goodwill
amortization of $671,000 or $0.05 per share. See Note F to the Company's
condensed consolidated financial statements for further discussion regarding the
impact of the accounting method change.

         INSURANCE PREMIUMS AND MEMBERSHIP

         Insurance premiums for the three months ended March 31, 2002 decreased
12.6% to $194.4 million from $222.5 million for the same period in 2001. The
decrease primarily resulted from a decline in membership in select unprofitable
small employer group and exited markets and high lapse rates of existing
membership in core markets, partially offset by rising premium rates on the
continuing block of business. Average fully insured medical premium per member
per month for the first quarter of 2002 increased by 15.0% to $168, compared to
the first quarter of 2001, reflecting significant rate actions taken by the
Company. As a result of the Company's actions to change its product mix,
redefine its markets, increase profitability, and reposition itself for the
future, quarterly insurance premiums are expected to level before improving
later in 2002.

         Total medical and dental membership declined from 652,683 members at
March 31, 2001 to 539,481 members at March 31, 2002. The membership decrease is
primarily the result of the Company's success in terminating business in several
unprofitable markets, including exited markets, and premium rate increases
resulting in lower new sales and higher lapses on existing business. The
Company's MedOneSM product for individuals and families continues to grow as a
percentage of the Company's overall business reflecting management's strategy to
change the Company's mix of business. MedOneSM membership now accounts for 46%

                                                                              13

<PAGE>

of the Company's medical membership in force. At the end of 2000 and 2001,
MedOneSM membership accounted for 34% and 45%, respectively. Management
considers the MedOneSM product to be a key strategic product and continues to
take steps to accelerate membership and premium growth in this market.

         NET INVESTMENT INCOME

         Net investment income for the three months ended March 31, 2002
decreased to $3.9 million from $4.5 million for the three months ended March 31,
2001. The decrease in net investment income is due primarily to a decrease in
the average annual investment yield. The average annual investment yield was
6.0% for the first quarter of 2002 compared to 6.6% for the first quarter of
2001. Invested assets in March 2002 have declined primarily as a result of the
repurchase of 1.4 million shares of the Company's common stock for a total cost
of $19.5 million, including related transaction costs, from Blue Cross & Blue
Shield United of Wisconsin ("BCBSUW").

         LOSS RATIO

         The health segment loss ratio for the first quarter of 2002 was 68.5%
compared to 75.7% for the first quarter of 2001. The significant improvement was
due to management's actions and strategies to increase premium rates and combat
medical inflation. These actions included premium rate increases, claims cost
control initiatives and the exit from unprofitable small employer group markets.
The reduction also reflects increased sales of MedOneSM products, which are
priced for a lower loss ratio but have higher selling and administrative costs.
As anticipated, claim costs per member per month have increased slightly, but
were surpassed by increased premiums per member per month. Average premium per
member per month for the first quarter of 2002 increased 15.0% compared with the
first quarter of 2001. Average claims costs increased only 4.1% over the same
period.

         The life segment loss ratio for the three months ended March 31, 2002
was 33.1% compared to 40.1% for the three months ended March 31, 2001. The life
segment loss ratio tends to fluctuate from quarter to quarter as actual life
claims experience fluctuates. The life segment loss ratio for the three month
period ended March 31, 2002 is consistent with historical averages and
anticipated average future results for this segment.

         In determining the liability for unpaid claims at December 31, 2001,
the Company anticipated an effect on claims expense from the events of the
September 11, 2001 and subsequent bio-terrorism attacks. The Company has not
discerned a material adverse affect related to these events and therefore, no
longer holds reserves for these matters as of March 31, 2002.

         SELLING, GENERAL AND ADMINISTRATIVE EXPENSE RATIO

         The selling, general and administrative ("SG&A") expense ratio includes
commissions and selling expenses, administrative expenses (less other revenues),
and premium taxes and assessments. The SG&A expense ratio for health segment
products for the three months ended March 31, 2002 was 28.2%. This compares to
the first quarter of 2001 SG&A expense ratio of 25.2%, excluding the
non-recurring legal charge. The first quarter 2001 reported SG&A expense ratio,
including the non-recurring legal charge, was 29.4%. The increase from the prior
year, excluding the non-recurring legal charge, largely reflects a product mix
change driven by growth in the MedOneSM business, which has higher selling and
administrative costs but lower claim costs than small employer group products.
Lower premium volume also contributed to the increase in the SG&A ratio.

         The health segment combined ratio, which represents the sum of the
health loss and expense ratios was 96.7% for the three months ended March 31,
2002 compared to 100.9% for the same period in the prior year, excluding the
non-recurring legal charge.  The first quarter 2001 combined ratio, including
the non-recurring legal charge, was 105.1%.


                                                                              14

<PAGE>

LIQUIDITY AND CAPITAL RESOURCES

         The Company's sources of cash flow consist primarily of insurance
premiums, administrative fee revenue and investment income. The primary uses of
cash include payment of medical and other benefits, SG&A expenses and debt
service costs. Positive cash flows are invested pending future payments of
medical and other benefits and other operating expenses. The Company's
investment policies are designed to maximize yield, preserve principal and
provide liquidity to meet anticipated payment obligations.

         The Company's cash provided by operations was $3.1 million for the
three months ended March 31, 2002. This compares to cash used in operations of
$8.1 million for the three months ended March 31, 2001. The improvement in cash
flow primarily reflects increased profitability of the Company. Management
expects cash flow to remain positive for the year 2002.

         The Company is well capitalized and has a debt to total capital ratio
of 14.0% at March 31, 2002, which is low by industry standards.

         The Company's investment portfolio consists primarily of investment
grade bonds and has limited exposure to equity securities. At March 31, 2002 and
December 31, 2001, greater than 99% of the Company's investment portfolio was
invested in bonds. The bond portfolio had an average quality rating of AA at
March 31, 2002 and December 31, 2001, as measured by Standard & Poor's
Corporation. The majority of the bond portfolio was classified as available for
sale. The Company has no investment in mortgage loans, non-publicly traded
securities (except for principal only strips of U.S. Government securities),
real estate held for investment or financial derivatives.

         The Company's principal insurance subsidiary, United Wisconsin Life
Insurance Company ("UWLIC"), is domiciled in Wisconsin, which requires certain
minimum levels of regulatory capital and surplus and which may restrict
dividends to UWLIC's parent company. The Wisconsin Commissioner of Insurance may
disapprove any dividend which, together with other dividends paid in the prior
12 months, exceeds the regulatory maximum, computed as the lesser of 10% of
statutory surplus or total statutory net gain from operations as of the end of
the preceding calendar year. Based upon UWLIC's financial statements as of
December 31, 2001, as filed with the insurance regulators, and dividends paid in
2002, UWLIC is restricted from paying dividends without prior regulatory
approval.

         The National Association of Insurance Commissioners has adopted
risk-based capital ("RBC") standards for health and life insurers designed to
evaluate the adequacy of statutory capital and surplus in relation to various
business risks faced by such insurers. The RBC formula is used by state
insurance regulators as an early warning tool to identify insurance companies
that potentially are inadequately capitalized. At December 31, 2001, each of the
Company's insurance subsidiaries had RBC ratios that were substantially above
the levels which would require action by the Company or a regulator.

         On March 19, 2002, the Company entered into a stock purchase agreement
with Cobalt Corporation ("Cobalt") and its wholly owned subsidiary, BCBSUW, the
Company's largest shareholder, to repurchase 1.4 million shares of the Company's
common stock owned by BCBSUW at a total cost of $19.5 million, including related
transaction costs. To effect the stock repurchase, which was completed on March
22, 2002, the Company received a $20.0 million dividend from UWLIC with
regulatory approval. Also in conjunction with the stock repurchase, the Company,
Cobalt and BCBSUW agreed to an underwritten secondary offering of at least 3.0
million shares of the remaining shares of the Company's common stock owned by
BCBSUW. On April 19, 2002, the Company filed a registration statement with the
Securities and Exchange Commission to offer 3.5 million shares owned by BCBSUW.
The Company has committed to pay a portion of the expenses of the offering,
which is expected to occur in the second quarter of 2002.

                                                                              15
<PAGE>


         At March 31, 2002, the Company maintained a revolving bank line of
credit agreement with an outstanding balance and maximum commitment of $30.2
million. At December 31, 2001, the outstanding balance and maximum commitment
under the credit agreement was $35.2 million. In February 2002, in accordance
with the revolving bank line of credit, the Company paid $5.0 million of the
outstanding balance. The Company's obligations under the credit agreement are
guaranteed by its subsidiary, American Medical Security Holdings, Inc. ("AMS
Holdings"), and secured by pledges of the stock of AMS Holdings and UWLIC, the
Company's primary insurance subsidiary.

         The credit agreement contains customary covenants which, among other
matters, require the Company to achieve certain minimum financial results and
restrict the Company's ability to incur additional debt, pay future cash
dividends and dispose of assets outside the ordinary course of business. The
Company was in compliance with all such covenants at March 31, 2002 and
anticipates continued compliance in the foreseeable future. The Company believes
that the implementation of Statement of Financial Accounting Standards No. 142,
as described in Note F to the condensed consolidated financial statements, will
not adversely impact the Company's compliance with its debt covenants. The
credit agreement was amended in March 2002 to allow for the repurchase of the
1.4 million shares from BCBSUW and revise the minimum financial requirements of
certain covenants and the schedule of mandatory future commitment reductions.

CAUTIONARY FACTORS

         This report and other documents or oral presentations prepared or
delivered by and on behalf of the Company contain or may contain
"forward-looking statements" within the meaning of the safe harbor provisions of
the United States Private Securities Litigation Reform Act of 1995.
Forward-looking statements are statements based upon management's expectations
at the time such statements are made and are subject to risks and uncertainties
that could cause the Company's actual results to differ materially from those
contemplated in the statements. Readers are cautioned not to place undue
reliance on the forward-looking statements. When used in written documents or
oral presentations, the terms "anticipate," "believe," "estimate," "expect,"
"forecast," "objective," "plan," "possible," "potential," "project" and similar
expressions are intended to identify forward-looking statements. In addition to
the assumptions and other factors referred to specifically in connection with
such statements, factors that could cause the Company's actual results to differ
materially from those contemplated in any forward-looking statements include,
among others, the following:

o    Unexpected increases in health care costs resulting from advances in
     medical technology, increased utilization of medical services and
     prescription drugs resulting from bioterrorism or otherwise, possible
     epidemics and natural or man-made disasters and other factors affecting the
     delivery and cost of health care that are beyond the Company's control.
     There are also known trends, such as the aging of the population, that can
     have an uncertain effect on health care costs.

o    The Company's ability to distribute and sell its products, including,
     changes in its business relationships with independent agents who sell the
     Company's products, the Company's ability to retain key producing sales
     agents, the Company's ability to expand its distribution network,
     competitive factors such as the entrance of additional competitors into the
     Company's markets, competitive pricing practices, the Company's ability to
     generate new sales, sell new products and retain existing members, the
     Company's ability to predict future health care cost trends and adequately
     price its products, and the Company's ability to control expenses during a
     time of declining revenue and membership.

o    Federal and state laws adopted in recent years, currently proposed, such as
     the Patients' Bill of Rights, or that may be proposed in the future, which
     affect or may affect the Company's operations, products, profitability or
     business prospects. Reform laws adopted in recent years generally limit the
     ability of the Company to use risk selection as a method of controlling
     costs for its small employer group business.

                                                                              16
<PAGE>


o    Regulatory factors, including delays in regulatory approvals of rate
     increases and policy forms; regulatory action resulting from market conduct
     activity and general administrative compliance with state and federal laws;
     restrictions on the ability of the Company's subsidiaries to transfer funds
     to the Company or its other subsidiaries in the form of cash dividends,
     loans or advances without prior approval or notification; the granting and
     revoking of licenses to transact business; the amount and type of
     investments that the Company may hold; minimum reserve and surplus
     requirements; and risk-based capital requirements.

o    Factors related to the Company's efforts to maintain an appropriate medical
     loss ratio in its small employer group health and MedOneSM health business,
     (including implementing significant rate increases, terminating business in
     unprofitable markets, and introducing redesigned products), and the
     willingness of employers and individuals to accept rate increases, premium
     repricing and redesigned products.

o    The development of and changes in claims reserves.

o    The effectiveness of the Company's strategy to expand sales of its MedOneSM
     products for individuals and families, to focus its small employer group
     health product sales in core markets and to grow its ancillary products,
     including its dental, life, and self-funded benefit administration
     business.

o    The cost and other effects of legal and administrative proceedings,
     including the expense of investigating, litigating and settling any claims
     or paying any judgments against the Company, and the general increase in
     litigation involving managed care and medical insurers.

o    Adverse outcomes of the Florida class action or other litigation in excess
     of provisions made by the Company.

o    Restrictions imposed by financing arrangements that limit the Company's
     ability to incur additional debt, pay future cash dividends and transfer
     assets.

o    Changes in rating  agency  policies and  practices  and the ability of the
     Company's  insurance  subsidiaries  to maintain or exceed their A-
     (Excellent) rating by A.M. Best.

o    General economic conditions, including changes in employment, interest
     rates and inflation that may impact the performance of the Company's
     investment portfolio or decisions of individuals and employers to purchase
     the Company's products.

o    The Company's ability to maintain attractive preferred provider networks
     for its insureds.

o    Factors affecting the Company's ability to hire and retain key executive,
     managerial, professional and technical employees.

o    Changes in accounting principles and the effects related to such changes.

o    Other business or investment considerations that the Company may disclose
     from time to time in its Securities and Exchange Commission filings or in
     other publicly disseminated written documents.

         The Company undertakes no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information, future
events or otherwise.


ITEM 3.   QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

              The Company's market risk has not substantially changed from the
year ended December 31, 2001.

                                                                              17
<PAGE>


PART II.      OTHER INFORMATION

ITEM 1.   LEGAL PROCEEDINGS

          FLORIDA REGULATORY ACTION AND CLASS ACTION LITIGATION

          The following is a report (previously included in a Form 8-K dated
April 24, 2002) of recent developments in two previously reported legal
proceedings and should be read in conjunction with Item 3, Legal Proceedings, in
the Company's annual report on Form 10-K for the fiscal year ended December 31,
2001.

          In May 2001, the Florida Department of Insurance issued an
administrative complaint against the Company's wholly owned subsidiary, United
Wisconsin Life Insurance Company ("UWLIC"), challenging UWLIC's rating and other
practices in Florida relating to its MedOneSM products. MedOneSM products sold
by the Company in Florida are written pursuant to a group master policy issued
to an association domiciled in a state other than Florida. Therefore, management
believes the Company is exempt from most of Florida rating requirements and that
it has not violated rating or other regulations applicable to the Company. The
complaint seeks penalties or other administrative actions including possible
suspension or revocation of UWLIC's certificate of authority to do business in
Florida. The case was presented to an Administrative Law Judge in a hearing held
in January 2002 (the "Administrative Hearing").

          In a separate proceeding, a class action lawsuit was filed against two
of the Company's subsidiaries, American Medical Security, Inc. ("AMS") and UWLIC
in February 2000 in the Circuit Court for Palm Beach County, Florida, by Evelyn
Addison and others ("Addison") alleging that the Company failed to follow
Florida law in discontinuing writing certain health insurance policies and
offering new policies in 1998, and that the Company wrongfully terminated
coverage, improperly notified insureds of conversion rights and charged improper
premiums for new coverage. Plaintiffs also alleged that the UWLIC's renewal
rating methodology violates Florida law. Plaintiffs are seeking unspecified
damages. A bench trial on the liability issues of the Addison case was held in
Circuit Court in March 2002.

          The Company believes that the administrative matter and the Addison
case, although procedurally unrelated, arise from essentially the same set of
facts and involve substantially similar legal issues. The substantially similar
issues in the two cases include: (1) whether group coverage issued by the
Company to individuals from 1993 to the present is exempt from most portions of
Chapter 627, Part VII, of the Florida Insurance Code, which relates to insurance
rates and contracts for group health insurance policies; (2) whether the Company
complied with Florida law when it discontinued certain coverage and replaced the
discontinued coverage with certain other coverage in 1999; (3) whether Florida
law prohibits tier rating of out-of-state groups; and (4) whether the Company
properly notified insureds whose coverage had been discontinued of their rights
to purchase conversion coverage.

          In a Recommended Order entered April 25, 2002, the Administrative Law
Judge in the Administrative Hearing found in favor of the Company on all of the
above issues and held that the evidence presented by the Florida Department of
Insurance did not support a conclusion that UWLIC had violated any provisions of
the Florida insurance statutes or regulations. The Administrative Law Judge
recommended that all counts of the Department's administrative complaint be
dismissed. The Recommended Order has been sent to the Commissioner of the
Florida Department of Insurance for entry of a final order. The Commissioner
must accept all of the findings of fact in the Recommended Order, but may make
modifications to the conclusions of law.

          In a Final Judgment entered April 24, 2002, the Circuit Court in
Addison found against the Company on all of the above issues and ordered that
the question of damages be tried before a jury at a time to be scheduled by the
Court. The damages portion of the lawsuit is expected to be heard before a jury
later this year.

          In light of the conflicting findings of the Administrative Law Judge
and the Circuit Court Judge, the Company intends to request that the Court in
Addison reconsider its ruling. If the ruling is not reconsidered, the Company
intends to appeal the ruling at the conclusion of the damages phase of the
trial.

                                                                              18

<PAGE>

          HEALTH ADMINISTRATORS LITIGATION

          In February 2000, a $5.4 million verdict was entered against the
Company's subsidiaries AMS and UWLIC in the Common Pleas Court of Delaware
County, Ohio, Civil Division, in a lawsuit brought against AMS and UWLIC in 1996
by Health Administrators of America, Inc. ("Health Administrators"), an
insurance agency owned and operated by a former agent of AMS. The lawsuit
alleges breach of written and oral contracts involving commission amounts and
fraud. The case was heard and decided by a magistrate who awarded damages to
Health Administrators, based on breach of written commission and agent contracts
and ruled in favor of the Company on breach of oral contracts and fraud. The
Company filed objections with the Common Pleas Court requesting that the
magistrate's decision against the Company be reversed. The Common Pleas Court
approved the magistrate's decision in April 2000. As a result, the Company filed
a notice of appeal with the Court of Appeals, Delaware County, Ohio, Fifth
Appellate District. On March 29, 2001, the Court of Appeals affirmed a portion
of the verdict, with modifications, representing approximately $3.0 million in
damages, and reversed and remanded the remaining issues in the case representing
approximately $2.4 million in damages. The Company appealed the $3.0 million
portion of the damages to the Ohio Supreme Court, which, in July 2001, declined
to take the appeal. The Company paid substantially all of the approximately $3.0
million judgment in December 2001. Briefs have been submitted for the remanded
portion of the case, and the parties are awaiting the trial court's decision.

          The Company is involved in the foregoing and various other legal and
regulatory actions occurring in the normal course of business. Based on current
information including consultation with outside counsel, management believes any
ultimate liability that may arise from the above-mentioned and all other legal
and regulatory actions would not materially affect the Company's consolidated
financial position or results of operations. However, management's evaluation of
the likely impact of these actions could change in the future and an unfavorable
outcome could have a material adverse effect on the Company's consolidated
financial position, results of operations or cash flow of a future period.


ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K

          (a)      Exhibits

          See the Exhibit Index following the Signature page of this report,
which is incorporated herein by reference.

          (b)      Reports on Form 8-K

          The following reports on Form 8-K were filed or submitted during the
first quarter of 2002:

o         A Form 8-K dated  February 1, 2002,  was filed by the Company on
          February  5, 2002 to report the  amendment  of the  Company's
          shareholder rights agreement.

o         A Form 8-K dated February 5, 2002, was submitted by the Company on
          February 6, 2002 to furnish under Item 9, Regulation FD Disclosure, a
          financial presentation included on the Company's website.

o         A Form 8-K dated March 19,  2002,  was filed by the  Company on March
          20,  2002 to report that the Company had entered  into a stock
          purchase agreement with Cobalt and BCBSUW.

o         A Form 8-K dated March 25, 2002, was filed by the Company on March 26,
          2002 to report the completion of the 1.4 million share repurchase from
          BCBSUW pursuant to the stock purchase agreement.

          After the end of the quarter, a Form 8-K dated April 24, 2002, was
filed by the Company on April 26, 2002 to report recent developments in two
previously reported legal proceedings.

                                                                              19

<PAGE>


SIGNATURES


         Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.


DATE:  May 7, 2002


                                           AMERICAN MEDICAL SECURITY GROUP, INC.


                                           /S/ GARY D. GUENGERICH
                                           Gary D. Guengerich
                                           Executive Vice President and Chief
                                           Financial Officer
                                           (Principal Financial Officer and
                                           Chief Accounting Officer and duly
                                           authorized to sign on behalf of the
                                           Registrant)


                                                                              20

<PAGE>



                      AMERICAN MEDICAL SECURITY GROUP, INC.
                          (Commission File No. 1-13154)

                                  EXHIBIT INDEX
                                       to
                           FORM 10-Q QUARTERLY REPORT
                        for quarter ended March 31, 2002

<TABLE>
<CAPTION>
<S>               <C>                                                    <C>                                           <C>
                                                                         Incorporated Herein                           Filed
EXHIBIT NO.       Description                                            by Reference to                               Herewith

4.1(a)            Fifth  Amendment  dated as of March 21, 2002           Exhibit 4 to the Registrant's  Form 8-K
                  to  Credit  Agreement  dated as of March 24,           dated March 25, 2002
                  2000  (the  "Credit  Agreement")  among  the
                  Registrant,     LaSalle    Bank     National
                  Association and other Lenders

4.1(b)            Revised  Fifth  Amendment  dated as of March           Exhibit  4.3(f)(ii) to the Registrant's
                  21,  2002  to  Credit  Agreement  (replacing           Form S-3  Registration  Statement filed
                  Exhibit 4.1(a))                                        April 19, 2002 (File No. 333-86660)

4.2(a)            Appointment  and Assumption  Agreement dated           Exhibit  4.2 to the  Registrant's  Form
                  December  17, 2001,  between the  Registrant           8-K   dated   February   1,  2002  (the
                  and Firstar Bank,  N.A.  appointing  LaSalle           "2/1/02 8-K")
                  Bank,  N.A.  as Rights  Agent for the Rights
                  Agreement  dated as of August 9, 2001  ("the
                  Rights  Agreement")  between the  Registrant
                  and Firstar Bank, N.A.

4.2(b)            Amendment  dated as of  February  1, 2002 to           Exhibit 4.1 to the 2/1/02 8-K
                  the Rights Agreement

10.1              Agreement dated February 1, 2002,  among the           Exhibit 10.1 to the 2/1/02 8-K
                  Registrant,   Cobalt  Corporation  and  Blue
                  Cross  & Blue  Shield  United  of  Wisconsin
                  concerning the Rights Agreement

10.2              Stock Purchase  Agreement  dated as of March           Exhibit 10 to the Registrants  Form 8-K
                  19,  2002  among  the   Registrant,   Cobalt           dated March 19, 2002
                  Corporation  and  Blue  Cross & Blue  Shield
                  United of Wisconsin

                                                                                                                           EX-1
</TABLE>