FORM 10-Q
                                  
                            UNITED STATES
                 SECURITIES AND EXCHANGE COMMISSION
                        Washington, DC 20549
                                  
                                  
 (Mark One)
     [X]QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
                   SECURITIES EXCHANGE ACT OF 1934
         For the quarterly period ended:       June 30, 1997
                                  
                                 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:     1-11714
                                  
                                  
                        CITIZENS CORPORATION
       (Exact name of registrant as specified in its charter)
                                  
            Delaware                           04-3178765
    (State or other jurisdiction of       (I.R.S. Employer
     incorporation or organization)      Identification Number)
                                  
                                  
          440 Lincoln Street, Worcester, Massachusetts    01653
              (Address of principal executive offices)  (Zip Code)
                                                
                             (508) 855-1000
        (Registrant's telephone number, including area code)
                                  
                                  
(Former name, former address and former fiscal year, if changed since
 last report)

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 [   ]

          APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
            PROCEEDINGS DURING THE PRECEDING FIVE YEARS:

Indicate by check mark whether the registrant has filed all documents
and  reports required to be filed by Section 12, 13 or 15(d)  of  the
Securities  Exchange  Act of 1934 subsequent to the  distribution  of
securities under a plan confirmed by a court.
Yes [   ]          No [   ]

                APPLICABLE ONLY TO CORPORATE ISSUERS:

Indicate the number of shares outstanding of each of the registrant's
classes of common stock as of the latest practicable date: 35,269,100
Shares of Common Stock Outstanding, as of August 1, 1997.  


                                  16
                         Total Number of Pages


                                  1
=====================================================================


                          TABLE OF CONTENTS





PART I - FINANCIAL INFORMATION



   ITEM 1 - FINANCIAL STATEMENTS
           Consolidated Statements of Income                      3
           Consolidated Balance Sheets                            4
           Consolidated Statements of Shareholders' Equity        5
           Consolidated Statements of Cash Flows                  6
           Notes to Consolidated Financial Statements             7


   ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS
             OF FINANCIAL CONDITION AND RESULTS OF
             OPERATIONS                                           8 - 13


PART II - OTHER INFORMATION


   ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS   14
   
   ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K                      15





SIGNATURES                                                        16


                                  2
=====================================================================
                                  


 

                    PART 1 - FINANCIAL INFORMATION
                                   
                     ITEM 1 - FINANCIAL STATEMENTS

                         CITIZENS CORPORATION
                   CONSOLIDATED STATEMENTS OF INCOME

<TABLE>
<S>                                                              <C>      <C>        <C>      <C>
                                                                   (Unaudited)         (Unaudited)    
                                                                  Quarter Ended      Six Months Ended   
                                                                     June 30,            June 30,               
(In millions, except per share data)                              1997      1996      1997     1996            
                                                                --------  --------  --------  -------
Revenues                                                            
 Net premiums written                                           $ 208.0   $ 205.9   $ 419.9   $ 421.8
                                            
 Change in unearned premiums, net                                       
   of prepaid reinsurance premiums                                 (2.1)     (5.2)     (0.1)      6.2 
                                                                --------  --------  --------  -------- 
 Net premiums earned                                              210.1     211.1     420.0     415.6 
 Net investment income                                             26.1      21.2      49.7      40.8 
 Net realized (losses) gains on investments                        (0.6)      0.3      19.1      15.0 
 Other income                                                       1.5       1.8       3.0       3.4 
                                                                --------  --------  --------  --------
    Total revenues                                                237.1     234.4     491.8     474.8 
                                                                    


Expenses                                                            
 Losses and loss adjustment expenses                              158.7     162.6     317.2     316.8 
 Policy acquisition and other operating expenses                   56.2      55.0     114.5     111.2 
 Policyholders' dividends                                           1.8       1.8       3.4       3.6 
                                                                --------  --------  --------  --------
    Total expenses                                                216.7     219.4     435.1     431.6 
                                                                --------  --------  --------  --------
                                                                    
 
 Income before federal income taxes                                20.4      15.0      56.7      43.2 

Federal income tax expense                                          3.8       2.9      11.7       8.6
                                                                --------  --------  --------  --------
Net Income                                                      $  16.6   $  12.1   $  45.0   $  34.6
                                                                ========  ========  ========  ========
                                                
Per share data                                                      
                                                                    
  Net income                                                     $ 0.47   $  0.34   $  1.27   $  0.97
                                                                ========  ========  ========  ========
                                                                    
Dividends declared to shareholders                               $ 0.05   $  0.05   $  0.10   $  0.10
                                                                ========  ========  ========  ======== 

Weighted average shares outstanding                                35.3      35.6      35.3      35.7 
                                                                ========  ========  ========  ======== 
                                                                
                                                                
            The accompanying notes are an integral part of these financial statements.
            
</TABLE>



                                    3
==========================================================================

<TABLE>
<S>                                                           <C>              <C>
                                                                    
                         CITIZENS CORPORATION
                      CONSOLIDATED BALANCE SHEETS
                                   
                                   
                                                              (Unaudited)
(In millions, except per share data)                            June 30,       December 31,
                                                                  1997            1996
Assets                                                        ----------       ----------
Investments:                                                   
 Debt securities available-for-sale, at fair value            $  1,451.0       $  1,398.3
  (Amortized cost of $1,417.9 and $1,366.9)                    
 Equity securities available-for-sale, at fair value               163.1            192.3
  (Cost of $95.4 and $132.3)                                    
 Other investments, at fair value (Cost of                          15.5             14.6
  $15.3 and 13.2)                                             ----------       ----------
  Total investments                                              1,629.6          1,605.2
 Cash and cash equivalents                                          39.3             36.1
 Accrued investment income                                          26.0             25.3
 Premiums receivable                                               137.7            140.3
 Reinsurance recoverable on paid and unpaid balances               488.4            476.8
 Prepaid reinsurance premiums                                       66.9             62.8
 Deferred policy acquisition expenses                               54.5             54.3
 Deferred federal income taxes                                      22.7             25.4
 Other assets                                                       69.6             76.8
                                                              ----------       ----------
   Total assets                                               $  2,534.7       $  2,503.0
                                                              ==========       ==========
                                                
                                                               
Liabilities and Shareholders' Equity                           
Liabilities:                                                   
 Reserve for losses and loss adjustment expenses              $  1,232.5       $  1,238.5
 Unearned premiums                                                 366.3            362.3
 Other liabilities                                                 134.7            147.7
                                                              ----------       ----------
   Total liabilities                                             1,733.5          1,748.5
                                                              ----------       ----------
                                                              
Shareholder's Equity                                    
 Series A preferred stock, $0.01 par value per share;                     
   authorized 10.0 million shares; none issued or
   outstanding in 1997 and 1996                                        -                -
 Common stock, par value $0.01 per share;                      
   authorized 100.0 million shares; issued 36.1                      0.4              0.4
   million shares
 Additional paid-in capital                                        156.1            156.1
 Retained earnings                                                 594.0            552.5
 Unrealized appreciation on investments, net of                       
   deferred federal income taxes                                    65.7             60.5
 Treasury stock, at cost (0.8 million shares in 1997               (15.0)           (15.0)
   and 1996)                                                  ----------       ----------
    Total shareholder's equity                                     801.2            754.5
                                                              ----------       ----------
     Total liabilities and shareholder's equity               $  2,534.7       $  2,503.0
                                                              ==========       ==========
                                                              
                                                              
         The accompanying notes are an integral part of these financial statements.
         
         
</TABLE>

                                    4
==========================================================================
                                          
 <TABLE>
 <S>                                                         <C>        <C>                        
                         
                         CITIZENS CORPORATION
            CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY


                                                                 (Unaudited)
                                                               Six Months Ended
(In millions)                                                      June 30,
                                                                1997      1996
                                                              --------  --------
Preferred stock                                          
 Balance at beginning and end of period                              -         -     
                                                              --------  --------
                                                               
Common stock                                                   
 Balance at beginning and end of period                       $    0.4    $  0.4
                                                              --------  --------
                                                               
Additional paid-in capital                                     
 Balance at beginning and end of period                          156.1     156.1
 
                                                               
Retained earnings                                              
 Balance at beginning of period                                  552.5     475.5
 Net income                                                       45.0      34.6
 Dividends declared to shareholders                               (3.5)     (3.5)
                                                              --------  --------
 Balance at end of period                                        594.0     506.6
                                                              --------  --------
                                                               
Unrealized appreciation on investments, net                    
 Balance at beginning of period                                   60.5      54.7
 Appreciation (depreciation) during the period                     8.0     (30.8)
 (Provision) benefit for deferred federal income taxes            (2.8)     10.8
                                                              --------  --------
 Balance at end of period                                         65.7      34.7
                                                              --------  -------- 

Treasury stock                                                 
 Balance at beginning of period                                  (15.0)     (3.9)
 Shares purchased at cost                                            -     (10.8)
                                                              --------  --------
 Balance at end of period                                        (15.0)    (14.7)
                                                              --------  -------- 

Total shareholders' equity                                    $  801.2  $  683.1
                                                              ========  ========
                                                              
                                                              
                                                              
        The accompanying notes are an integral part of these financial statements.
        
</TABLE>

                                    5
==========================================================================

<TABLE>  
<S>                                                            <C>        <C>                         
                                   
                         CITIZENS CORPORATION
                 CONSOLIDATED STATEMENTS OF CASH FLOWS



                                                                     (Unaudited)
                                                                  Six Months Ended
(In millions)                                                          June 30,
                                                                   1997       1996
                                                                ---------   --------
                                                                
Cash flows from operating activities                      
Net income                                                        $  45.0    $  34.6
                                                       
Adjustments to reconcile net income to                          
 net cash provided by operating activities:                     
  Net realized gains on investments                                 (19.1)     (15.0)
  Deferred federal income tax (benefit) provision                    (0.1)       0.7
  Change in assets and liabilities:                              
   Deferred policy acquisition expenses                              (0.2)      (2.3)
   Premiums and notes receivable, net of                             (0.6)      (2.2)
     reinsurance premiums
   Unearned premiums, net of prepaid                                 (0.1)       6.2
     reinsurance premiums
   Reserve for losses and loss adjustment expenses,                 (17.6)       8.2     
     net of reinsurance recoverable              
   Other, net                                                        (5.2)     (16.2)
                                                                ---------   --------
    Net cash provided by operating activities                         2.1       14.0
                                                                ---------   --------
                                                                
                                                                
Cash flows from investing activities                            
 Proceeds from sale of available-for-sale debt                      220.4      241.9
   securities                                                                  
 Proceeds from available-for-sale debt                               39.4       90.1
   securities maturing or called
 Proceeds from sale of available-for-sale                            59.2       64.4
   equity securities and other investments
 Purchases of available-for-sale debt securities                   (311.9)    (401.6)
 Purchases of sale of available-for-sale                             (5.6)     (22.0)
   equity securities and other investments
 Change in net receivable from securities                             3.7        5.9
   transactions not settled
 Other investing activities                                          (0.6)      (1.2)
                                                                ---------   --------
    Net cash provided by (used for) investing activities              4.6      (22.5)
                                                                ---------   --------
                                                                
                                                                
Cash flows from financing activities                            
 Dividends paid to shareholders                                      (3.5)      (3.5)
 Treasury stock purchased, at cost                                      -      (10.8)
                                                                ---------   --------
    Net cash used for financing activities                           (3.5)     (14.3)
                                                                ---------   --------

Change in cash and cash equivalents                                   3.2      (22.8)
Cash and cash equivalents at beginning of period                     36.1       59.1
                                                                ---------   --------
Cash and cash equivalents at end of period                        $  39.3    $  36.3
                                                                =========   ========         


     The accompanying notes are an integral part of these financial statements
     
</TABLE>



                                    6
==========================================================================
                        
                        
                        
                        CITIZENS CORPORATION
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  
1.     Basis of Presentation

The  accompanying  unaudited  consolidated  financial  statements  of
Citizens Corporation ("the Company") have been prepared in accordance
with  generally  accepted accounting principles applicable  to  stock
property  and  casualty  insurance companies  for  interim  financial
information  and  with the requirements of Form 10-Q.  Certain  prior
year  amounts  have  been reclassified to conform  with  the  current
year's presentation.

In  the  opinion of management, the financial statements reflect  all
adjustments  of  a  normal  recurring nature  necessary  for  a  fair
presentation  of  the  interim  periods.   Interim  results  are  not
necessarily  indicative  of results expected  for  the  entire  year.
These  financial  statements should be read in conjunction  with  the
Company's  1996 Annual Report to Shareholders, as filed on Form  10-K
with the Securities and Exchange Commission.

2. Earnings per Share

Earnings per share are based on the weighted average number of common
shares   and  common  share  equivalents.  The  Board  of   Directors
authorized the repurchase of 1.8 million shares or slightly less than
five percent of its issued common stock and has purchased a total  of
0.8 million shares since the implementation of the repurchase program
in 1995.  As of June 30, 1997, the Company is holding these shares as
treasury  stock for the purpose of funding current and  future  stock
option awards and for other purposes.

Recently  the FASB issued Statement of Financial Accounting Standards
No.  128,  Earnings Per Share, which supersedes APB Opinion  No.  15,
Earnings   Per  Share.   This  standard  replaces  the  primary   EPS
requirements  with  a  basic  EPS computation  and  requires  a  dual
presentation  of  basic  and diluted EPS  for  those  companies  with
complex  capital  structures.   The  Company  intends  to  adopt  the
standards of Statement No. 128 for financial statements issued  after
December  15, 1997.  The impact of this statement is expected  to  be
immaterial on the Company's EPS calculation.






                                  7
=========================================================================



                   PART I - FINANCIAL INFORMATION
                                  
                               ITEM 2
                                  
          MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                 CONDITION AND RESULTS OF OPERATIONS

The  results  of operations for Citizens Corporation and subsidiaries
(the   Company)   include  the  accounts  of   Citizens   Corporation
(Citizens),  a  non-insurance holding company, and  its  wholly-owned
subsidiaries,   Citizens  Insurance  Company  of  America,   Citizens
Insurance  Company  of Ohio, and Citizens Insurance  Company  of  the
Midwest  (collectively Citizens Operations), and Citizens  Management
Inc., which is wholly-owned by Citizens Insurance Company of America.

Results of Operations
---------------------
Net income

Net income for the quarter ended June 30, 1997, was $16.6 million, or
$0.47 per  share, compared to $12.1 million, or $0.34 per  share, for
the  quarter ended June 30, 1996.  Excluding net realized losses  and
restructuring  charges, both net of taxes, net income increased  $6.0
million, to $17.9 million for the quarter ended June 30, 1997, versus
$11.9  million during the comparable period of 1996. The increase  in
net income is primarily attributable to an increase in net investment
income of $4.9 million, in addition to a $2.8 million decrease in the
underwriting  loss.   The  growth in net investment  income  resulted
primarily  from an increase in average invested assets, the Company's
shift  to higher yielding debt securities, including longer durations
and  non-investment grade securities, and an increase in  partnership
income.   The slight improvement in underwriting results is primarily
due  to  a  decrease  in  catastrophe losses  of  $12.7  million  and
favorable  workers' compensation claims activity in both current  and
prior accident years, partially offset by less favorable current year
claims  experience in the personal automobile line.   Federal  income
tax  expense  increased  $0.9 million, to  $3.8  million,  while  the
effective tax rate decreased to 18.6% in the quarter ended  June  30,
1997 from 19.3% for the same period in 1996.

Net income for the six months ended June 30, 1997, was $45.0 million,
or  $1.27 per  share, compared to $34.6 million, or $0.97 per  share,
for the six months ended June 30, 1996.  Excluding realized gains and
restructuring  charges, both net of taxes, net income increased  $8.7
million,  to  $33.5 million for the six months ended June  30,  1997,
versus  $24.8  million during the comparable  period  of  1996.   The
increase  in  net income is primarily attributable to an increase  in
net investment income of $8.9 million, increase in realized gains  of
$4.1  million  and a $2.0 million decrease in the underwriting  loss.
The  growth  in  net  investment income resulted  primarily  from  an
increase  in average invested assets, the Company's shift  to  higher
yielding  debt  securities,  including  longer  durations  and   non-
investment  grade securities, and an increase in partnership  income.
Realized  gains were $19.1 million for the six months ended June  30,
1997  versus $15.0 million for the same period ended June  30,  1996.
The slight improvement in underwriting results is primarily due to  a
decrease  in  catastrophe  losses  of  $12.1  million  and  favorable
workers'  compensation  claims activity in  both  current  and  prior
accident  years,  partially  offset by less  favorable  current  year
claims  experience  in the commercial multiple peril  and  homeowners
lines.   Federal income tax expense increased $3.1 million, to  $11.7
million, while the effective tax rate increased to 20.6% in  the  six
months ended June 30, 1997 from 19.9% for the same period in 1996.


Revenues

Net  premiums  earned  decreased $1.0 million,  or  0.5%,  to  $210.1
million  for the quarter ended June 30, 1997, resulting from  a  $7.1
million  decrease in the Company's commercial lines partially  offset
by  a  $6.1  million increase in the Company's personal  lines.   Net
premiums  earned increased $4.4 million, or 1.1%, to  $420.0  million
for the six months ended June 30, 1997, resulting from an increase of
$14.7  million in the Company's personal segments and a  decrease  of
$10.3 million in the Company's commercial segments.  Contributing  to
premium growth are an increase in net premiums earned of $6.6 million
in  Ohio  and  Indiana resulting from expansion in  these  states,  a
nonrecurring $3.0 million decrease in premiums ceded to the  Michigan
Catastrophic Claims Association (MCCA) in the first quarter of  1997,
and  an increase in personal automobile and homeowners rates.   These
factors  were  partially offset by rate reductions  in  the  workers'
compensation line where competitive conditions continue in Michigan.



                                  8
=========================================================================

Segment Results
---------------

Personal segment

Personal  segment premiums represented 68.2% and 65.0% of  total  net
premiums  earned  for  the quarters ended June  30,  1997  and  1996,
respectively,  and 68.3% and 65.5% of total net premiums  earned  for
the six months ended June 30, 1997 and 1996, respectively.

                                                                    

<TABLE>
<S>                                                 <C>         <C>       <C>         <C>

 
                                                     ------------------------------------------                  
For the Periods Ended                                      Three Months          Six Months     
June 30, (in millions)                                   1997       1996       1997      1996                  
                                                     ------------------------------------------ 
                                                                    
Net premiums earned                                  $  143.3   $  137.2   $  287.0   $ 272.3 
                                              
Losses and loss adjustment expenses                     107.9      103.4      221.7     210.0                            
                                                                      
Policy acquisition and other underwriting expenses       37.7       37.0       77.2      74.2                                  
                                                     ---------  ---------  ---------  ---------                 
Underwriting loss                                     $  (2.3)   $  (3.2)  $  (11.9) $  (11.9) 
                                                     =========  =========  =========  =========
                                                                    
</TABLE>

                                                                    

Personal segment net premiums earned increased $6.1 million, or 4.4%,
to  $143.3  million for the quarter ended June 30, 1997, from  $137.2
million  for  the quarter ended June 30, 1996. Personal  segment  net
premiums  earned increased $14.7 million, or 5.4%, to $287.0  million
for  the six months ended June 30, 1997, from $272.3 million for  the
six   months  ended  June  30,  1996.   This  increase  is  primarily
attributable to a decrease in premiums ceded to the MCCA and to  rate
increases  in  personal automobile and homeowners.  The non-recurring
decrease  in premiums ceded to MCCA was a result of a lower surcharge
effective  January 1, 1997 for personal automobile policies  written.
These factors were partially offset by a 0.8% decrease in policies in
force   in  the  personal  automobile  line  since  June  30,   1996,
attributable to continued strong competition in Michigan.

The  personal  segment underwriting loss was $2.3  million  and  $3.2
million  for the quarters ended June 30, 1997 and 1996, respectively.
Catastrophe losses decreased $11.4 million over the prior year second
quarter, primarily in the homeowners line.  This was partially offset
by  an increase in claim severity in the personal automobile line for
the current accident year.  Policy acquisition and other underwriting
expenses   increased  $0.7  million,  or  1.9%,  to  $37.7   million,
reflecting the growth in net premiums earned and increased technology
expenses,   partially  offset  by  reductions  in  employee   related
expenses.

The  personal segment underwriting loss was $11.9 million for the six
months  ended  both,  June  30,  1997 and  1996.  Catastrophe  losses
decreased  $10.2  million  over  the prior  year,  primarily  in  the
homeowners  line. This was partially offset by an increase  in  claim
severity  in  the  homeowners  line for the  current  accident  year,
primarily  in  the  first  quarter.   Policy  acquisition  and  other
underwriting  expenses  increased $3.0 million,  or  4.0%,  to  $77.2
million,  reflecting the growth in net premiums earned and  increased
technology  expenses,  partially offset  by  reductions  in  employee
related expenses.





                                  9
=========================================================================


Commercial segment

Commercial segment premiums represented 31.8% and 35.0% of total  net
premiums  earned  for  the quarters ended June  30,  1997  and  1996,
respectively.   Commercial  segment premiums  represented  31.7%  and
34.5% of the total net premiums earned for the six months ended  June
30, 1997 and 1996 respectively.
                             
                               
<TABLE>
<S>                                                  <C>        <C>       <C>        <C>       
 
                                                     ------------------------------------------                  
For the Periods Ended                                     Three Months          Six Months     
June 30, (in millions)                                    1997      1996       1997       1996                  
                                                     ------------------------------------------                                
                                                                    
Net premiums earned                                    $  66.8   $  73.9   $  133.0   $  143.3
                                               
Losses and loss adjustment expenses                       49.4      59.2       94.1      106.8                            
                                   
Policy acquisition and other underwriting expenses        17.6      16.8       35.3       34.7                                 
           
Policyholders' dividends                                   1.8       1.8        3.4        3.6  
                                                     ---------  ---------  ---------  ---------               
Underwriting (loss) profit                             $  (2.0)  $  (3.9)  $    0.2   $   (1.8) 
                                                     =========  =========  =========  =========
                                                                    
</TABLE>

                                                                    

Commercial  segment net premiums earned decreased  $7.1  million,  or
9.6%, to $66.8 million for the quarter ended June 30, 1997 from $73.9
million for the quarter ended June 30, 1996.  Commercial segment  net
premiums  earned decreased $10.3 million, or 7.2%, to $133.0  million
for  the  six months ended June 30, 1997 from $143.3 million for  the
six  months  ended June 30, 1996.  This decrease is  attributable  to
rate  decreases  in rates for workers' compensation,  resulting  from
continued competitive conditions in Michigan in this line.  Rates  in
the workers' compensation line were decreased 6.4% and 8.7% effective
June  1,  1996 and March 1, 1997, respectively.  Management  believes
competitive conditions in Michigan in the workers' compensation  line
may impact future growth in net premiums earned.

The  commercial segment underwriting loss was $2.0 million  and  $3.9
million  for the quarters ended June 30, 1997 and 1996, respectively.
Losses  and  LAE  in the workers' compensation line  decreased  $12.2
million,  or  54.2%,  to  $10.3 million  primarily  as  a  result  of
favorable  claims activity in both current and prior accident  years.
Policy  acquisition  and other underwriting expenses  increased  $0.8
million,  or 4.8%, to $17.6 million, reflecting increased  technology
expenses in 1997.

The  commercial segment underwriting profit was $0.2 million for  the
six   months  ended  June  30,  1997,  compared  to  a  $1.8  million
underwriting  loss for the six months ended June 30,  1996.    Losses
and LAE in the workers' compensation line decreased $17.7 million, or
42.1%,  to  $24.3  million primarily as a result of favorable  claims
activity in both current and prior accident years.  Additionally, the
Company   experienced  less  favorable  claims  experience   in   the
commercial  multiple  peril  line.   Policy  acquisition  and   other
underwriting  expenses  increased $0.6 million,  or  1.7%,  to  $35.3
million, reflecting increased technology expenses in 1997.


Reserve for Losses and Loss Adjustment Expenses
-----------------------------------------------

The   Company  regularly  updates  its  reserve  estimates   as   new
information  becomes  available and further events  occur  which  may
impact  the resolution of unsettled claims.  Changes in prior reserve
estimates  are  reflected in results of operations in the  year  such
changes  are  determined to be needed and recorded. The  table  below
provides  a  reconciliation of the beginning and ending  reserve  for
unpaid losses and LAE as follows:



                                  10
=========================================================================

                                                               
<TABLE>
<S>                                                         <C>              <C>

                                                               
For the period ended June 30,   (in millions)                  1997             1996   
                                                          ------------------------------
                                                               
Reserve for losses and LAE, beginning of period            $  1,238.5       $  1,291.6 
                                                                                                         
Reserve for losses and LAE, net of reinsurance                            
  recoverable:
                                                               
     Provision for insured events of the                        352.8            331.1 
     current period
                                                               
     Decrease in provision for insured events of                (35.6)           (14.3) 
     prior years
                                                           -----------      -----------     
Total incurred losses and LAE                                   317.2            316.8 
                                                               
                                                               
                                                               
Payments, net of reinsurance recoverable:                      
                                                               
     Losses and LAE attributable to insured events of           157.6            146.6 
     current period
                                                               
     Losses and LAE attributable to insured events of           170.8            155.2 
     prior years
                                                           -----------      -----------      
Total payments                                                  328.4            301.8 
                                                               
                                                               
                                                               
Change in reinsurance recoverable on unpaid losses                5.2             21.0 
                                                           -----------      -----------    
                                                               
                                                               
Reserve for losses and LAE, end of period                  $  1,232.5       $  1,327.6 
                                                           ===========      ===========
                                                           
</TABLE>                                                           

                                                               


As  part  of  an ongoing process, the reserves have been re-estimated
for all prior accident years and were decreased by $35.6 million, and
$14.3  million,  for  the six months ended June 30,  1997  and  1996,
respectively.   The  favorable  reserve  development  in  both  years
primarily  reflects the initiatives taken by the  Company  to  manage
medical  costs  in the personal automobile and workers'  compensation
lines, as well as the impact of the Michigan Supreme Court ruling  on
workers' compensation indemnity payments, which decreases the maximum
amount  to  be  paid for indemnity cases on all existing  and  future
claims.

The  company regularly reviews its reserving techniques, its  overall
reserving  position  and its reinsurance.  Based  on  (i)  review  of
historical  data,  legislative enactments, judicial decisions,  legal
developments   in  impositions  of  damages,  changes  in   political
attitudes  and trends in general economic conditions, (ii) review  of
per  claim  information,  (iii) historical  loss  experience  of  the
Company  and the industry, (iv) the relatively short-term  nature  of
most  policies  and  (v)  internal estimates  of  required  reserves,
management  believes that adequate provision has been made  for  loss
reserves.   However,  establishment of  appropriate  reserves  is  an
inherently  uncertain  process and there can  be  no  certainty  that
current  established  reserves  will  prove  adequate  in  light   of
subsequent actual experience.  A significant change to the  estimated
reserves could have a material impact on the results of operations.

Investment Results
------------------

Net  investment  income  before taxes was  $26.1  million  and  $21.2
million  for the quarters ended June 30, 1997 and 1996, respectively.
The increase is the result of an increase in average invested assets,
the  Company's  portfolio  shift from  equity  securities  to  higher
yielding   debt  securities,  including  longer  duration  and   non-
investment  grade  securities,  and  increased  income  from  limited
partnership investments of $1.9 million.  The average pre-tax  yields
on  debt  securities  were  6.8% in 1997  and  6.2%  in  1996.    Net
investment income after taxes was $21.2 million and $17.9 million for
the  quarters  ended  June  30,  1997 and  1996,  respectively.   Net
realized losses on investments before taxes were $0.6 million  during
the  second  quarter  of 1997 and net realized gains  on  investments
before taxes were $0.3 million in 1996.




                                  11
=========================================================================



Net  investment  income  before taxes was  $49.7  million  and  $40.8
million   for  the  six  months  ended  June  30,  1997   and   1996,
respectively.  The increase is the result of an increase  in  average
invested assets, the Company's portfolio shift from equity securities
to higher yielding debt securities, including longer duration and non-
investment  grade  securities, and to increased income  from  limited
partnership investments of $2.2 million.  The average pre-tax  yields
on  debt  securities  were  6.8% in  1997  and  6.1%  in  1996.   Net
investment income after taxes was $41.0 million and $34.1 million for
the  six  months  ended  June 30, 1997 and 1996,  respectively.   Net
realized  gains  on investments before taxes were $19.1  million  and
$15.0  million  during  the  first  six  months  of  1997  and   1996
respectively.  Net realized gains in 1997 and 1996 primarily resulted
from sales of appreciated equity securities.

Investment Portfolio
--------------------

The  Company's  investment  portfolio  increased  $24.4  million,  to
$1,629.6  million during the first six months of 1997, from  $1,605.2
million  at  December  31,  1996.  Debt  securities  increased  $52.7
million,  to $1,451.0 million, from $1,398.3 million, and represented
89.0% and 87.1% of the carrying value of all investments at June  30,
1997   and  December  31,  1996,  respectively.   This  increase   is
consistent  with  the Company's strategy of increasing the  level  of
debt  securities in the portfolio. This was accomplished by  reducing
the  level  of equities in the portfolio, which resulted in  a  $29.2
million decrease in equity securities to $163.1 million in the as  of
June 30, 1997.  Tax-exempt securities represented 65.5% of total debt
securities at June 30, 1997 compared to 69.9% at December  31,  1996.
The  Company  may  make  modest extensions in  portfolio  incremental
credit  risk and adjustments to its taxable and tax-exempt  positions
in the future to seek to maximize after tax income

The  unrealized appreciation in the investment portfolio at June  30,
1997  was  $101.0 million compared to $92.8 million at  December  31,
1996. Unrealized appreciation during the first six months of the year
was  $1.7  million for bonds, and unrealized appreciation  on  equity
securities and other investments was $6.5 million.


Liquidity and Capital Resources
-------------------------------

Liquidity  describes the ability of a company to generate  sufficient
cash flows to meet the cash requirements of business operations.   As
a  holding  company, Citizens' primary source of cash for payment  of
dividends  to  its  shareholders  is  dividends  from  its  insurance
subsidiaries,  which  are  subject to limitations  imposed  by  state
regulators.  Such limitations require that dividends be paid only out
of  statutory earned surplus (unassigned funds) and a restriction  on
the  payment  of "extraordinary" dividends without prior approval  of
the state authorities.

Underwriting  and  investing, typically the  two  distinct,  but  not
separate operations in an insurance company, are the sources of  cash
for  Citizens  Insurance.  The primary sources of cash  are  premiums
collected, investment income and maturing investments.  Primary  cash
outflows are paid losses and LAE, policy acquisition expenses,  other
underwriting  expenses, and purchases of investments.  Cash  outflows
related  to  claim  losses  and  LAE  can  be  variable  because   of
uncertainties surrounding settlement dates for unpaid losses and  the
potential  for large losses either individually or in the  aggregate.
Accordingly, the Company's strategy is to monitor available cash  and
short-term investment balances in relation to projected cash needs by
matching  the maturities of its investments to expected  payments  of
current and long-term liabilities.

Net  cash provided by operating activities, for the six months  ended
June  30,  1997,  was $2.1 million compared to $14.0 million  in  the
prior  year  period.  This decrease is primarily attributable  to  an
increase in claim payments during the first six months of 1997.

Net  cash provided by (used for) investing activities for the Company
was $4.6 million and ($22.5) million for the first six months of 1997
and  1996,  respectively.   The increase  in  net  cash  provided  by
investing activities was attributable to decreased purchases of  debt
securities.

Net  cash  used  for financing activities for the  Company  was  $3.5
million and $14.3 million, for the first six months of 1997 and 1996,
respectively.    This  decrease  in  net  cash  used  for   financing
activities  was  due to the repurchase of $10.8 million  of  treasury
stock in 1996.

Shareholders' equity was $801.2 million, or $22.72 per share at  June
30,  1997,  compared to $754.5, or $21.39 per share at  December  31,
1996, resulting from higher net income and unrealized appreciation on
investments.   Changes  in  shareholders'  equity  related   to   the
unrealized  values of underlying portfolio investments will  continue
to  be  volatile  as market prices of debt securities fluctuate  with
changes in the interest rate environment.




                                  12
=========================================================================




The  Company  expects to continue to pay dividends in the foreseeable
future. However, payment of future dividends is subject to the  Board
of  Directors'  approval and is dependent, among other  things,  upon
earnings and the financial condition of the Company.

Based  on current trends, the Company expects to continue to generate
sufficient positive operating cash to meet all short-term  and  long-
term  cash  requirements.  The Company maintains  a  high  degree  of
liquidity   within  the  investment  portfolio  in   fixed   maturity
investments, common stock and short-term investments.


Forward-Looking Statements
--------------------------

The  Company  wishes to caution readers that the following  important
factors, among others, in some cases have affected and in the  future
could  affect,  the  Company's actual results  and  could  cause  the
Company's  actual  results for 1997 and beyond to  differ  materially
from those expressed in any forward-looking statements made by, or on
behalf of, the Company.  When used in the MD&A discussion, the  words
"believes,"  "anticipated,"  "expects" and  similar  expressions  are
intended  to  identify  forward-looking statements.   See  "Important
Factors  Regarding Forward-Looking Statements" filed as Exhibit  99.1
to  the Company's 1996 Annual Report to Shareholders and incorporated
herein by reference.

Factors that may cause actual results to differ materially from those
contemplated  or projected, forecast, estimated or budgeted  in  such
forward  looking  statements  include  among  others,  the  following
possibilities:   (i)  adverse  catastrophe  experience   and   severe
weather; (ii) adverse loss development for events the Company insured
in   prior   years;  (iii)  heightened  competition,  including   the
intensification  of price competition, the entry of new  competitors,
and the introduction of new products by new and existing competitors;
(iv)  adverse  state and federal legislation, including decreases  in
rates,  limitations on premium levels, increases in  minimum  capital
and  reserve  requirements,  benefit  mandates,  limitations  on  the
ability  to  manage  care  and utilization,  liabilities  related  to
tobacco  products,  and  tax  treatment of  insurance  products;  (v)
changes in interest rates causing a reduction of investment income or
in  the  market  value of interest rate sensitive  investments;  (vi)
failure  to  obtain  new  customers,  retain  existing  customers  or
reductions  in policies in force by existing customers; (vii)  higher
service,  administrative, or general expense  due  to  the  need  for
additional   advertising,  marketing,  administrative  or  management
information  systems expenditures; (viii) loss or retirement  of  key
executives;  (ix) increases in medical costs, including increases  in
utilization,  costs  of  medical services,  pharmaceuticals,  durable
medical  equipment  and  other  covered  items;  (x)  termination  of
provider  contracts or renegotiation at less cost-effective rates  or
terms  of  payment; (xi) changes in the Company's  liquidity  due  to
changes  in  asset  and  liability matching;  (xii)  restrictions  on
insurance  underwriting,  based on certain criteria,  (xiii)  adverse
changes  in the ratings obtained by independent rating agencies  such
as Moody's, Standard and Poors and A.M. Best.





                                  13
=========================================================================




                      PART II - OTHER INFORMATION
                                  
                               ITEM 4
                               ------   
                                  
         Submission of Matters to a Vote of Security Holders
         ---------------------------------------------------
The  registrant's annual shareholders' meeting was held  on  May  20,
1997.   All six directors nominated for re-election by the  board  of
directors  were named in the proxies for the meeting,  which  proxies
were  solicited pursuant to Regulation 14A of the Securities Exchange
Act  of 1934.  The following individuals were elected to serve a  one
year term:



                             VOTES FOR     WITHHELD
                             ---------     --------
  James A. Cotter, Jr.      34,891,177       7,434
  Neal J. Curtin            34,890,077       8,534
  Dona Scott Laskey         34,889,877       8,734
  James R. McAuliffe        34,891,177       7,434
  John F. O'Brien           34,885,177      13,434
  Eric A. Simonsen          34,890,877       7,734

Shareholders ratified the appointment of Price Waterhouse LLP as  the
Independent Public Accountants of Citizens Corporation for 1997: 
for 34,885,811; against 1,275; withheld 11,525.

                                  


                                  14
=========================================================================
                                
                                  
                                  
                               ITEM 6
                               ------   
                  Exhibits and Reports  on Form 8-K
                  ---------------------------------

(a)       Exhibits

          EX-11              Statement regarding computation of per share  
                             earnings.
                             
          EX-27              Financial Data Schedule

 .
(b)       Reports on Form 8-K

          On July  11, 1997, a report on Form 8-K was filed under Item 5,
          Other Events, the Registrant's announcement that third quarter
          results will be impacted by an estimated $10 million in pre-tax
          catastrophe losses resulting   from tornadoes and windstorms 
          which struck Michigan during the first week of July 1997.
                                  
                                  
                                  
                                  
                                  


                                  15
=========================================================================
                                 
                                  
                                  
                                  
                             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.


                        Citizens Corporation
                             Registrant




Dated     August 13, 1997            /s/ John F.O'Brien
          ---------------            -----------------------------
                                     John F. O'Brien
                                     President and Chief Executive
                                     Officer, and  
                                     Chairman of the Board
                                     


Dated     August 13, 1997            /s/ Edward J. Parry, III
          ---------------            ------------------------------
                                     Edward J. Parry, III
                                     Vice President, Chief Financial 
                                     Officer, Treasurer and Principal
                                     Accounting Officer






                                  16
=========================================================================