UNITED STATES

                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                    FORM 10-Q


     Quarterly Report Under Section 13 or 15(d) of the Securities Exchange Act
     of 1934

(Markone)
[X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
     ACT OF 1934

                For the quarterly period ended September 30, 2001

                                       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 33-28976

                           IDS LIFE INSURANCE COMPANY
              ----------------------------------------------------
             (Exact name of registrant as specified in its charter)

           MINNESOTA                                       41-0823832
-------------------------------------                  ------------------
 (State or other jurisdiction of                        (I.R.S. Employer
  incorporation or organization)                         Identification No.)

AXP FINANCIAL CENTER, MINNEAPOLIS, MINNESOTA                 55474
--------------------------------------------                 -----
 (Address of principal executive offices)                  (Zip Code)

       (Registrant's telephone number, including area code) (612) 671-1257
                                                            --------------

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

THE REGISTRANT MEETS THE CONDITIONS SET FORTH IN GENERAL INSTRUCTION H(1)(a) AND
(b) OF FORM 10-Q AND IS THEREFORE FILING THIS FORM WITH THE PERMITTED
ABBREVIATED NARRATIVE DISCLOSURE.


<PAGE>


                           IDS LIFE INSURANCE COMPANY

                                    FORM 10-Q

                    For the Quarter Ended September 30, 2001

                                Table of Contents

PART I - FINANCIAL INFORMATION                                         Page

     Item 1.  Financial Statements

              Consolidated Balance Sheets as of
              September 30, 2001 (unaudited) and
              December 31, 2000                                          3 - 4

              Consolidated Statements of Income for the
              three and nine months ended September 30, 2001
              and 2000 (unaudited)                                       5 - 6

              Consolidated Statements of Cash Flows for the
              nine months ended September 30, 2001 and 2000
              (unaudited)                                                7 - 8

              Notes to Consolidated Financial Statements
              (unaudited)                                                9 - 13

     Item 2.  Management's Discussion and Analysis of
              Consolidated Financial Condition and
              Results of Operations                                      14 - 16

PART II - OTHER INFORMATION                                              17 - 21

SIGNATURES                                                               22

<PAGE>


                           IDS LIFE INSURANCE COMPANY
                           CONSOLIDATED BALANCE SHEETS
                                  ($ thousands)
<TABLE>
<CAPTION>

                                                              September 30,          December 31,
ASSETS                                                            2001                   2000
------                                                      ----------------      ------------------

<S>                                                              <C>                     <C>
                                                                 (unaudited)
Investments:
    Fixed Maturities:
       Held to maturity, at amortized cost (Fair value:
            2000, $6,471,798)                                    $        --             $ 6,463,613
       Available for sale, at fair value (Amortized cost:
            2001, $19,519,708; 2000, $12,929,870)                 20,130,077              12,399,990
                                                             ----------------      ------------------

                                                                  20,130,077              18,863,603

    Mortgage loans on real estate                                  3,683,598               3,738,091
    Policy loans                                                     623,202                 618,973
    Other investments                                                630,127                 635,880
                                                             ----------------      ------------------

                  Total investments                               25,067,004              23,856,547

Cash and cash equivalents                                            128,701                 316,974

Amounts recoverable from reinsurers                                  494,736                 416,480

Amounts due from brokers                                               9,189                  15,302

Other accounts receivable                                             10,858                  42,324

Accrued investment income                                            287,302                 334,928

Deferred policy acquisition costs                                  3,016,065               2,951,655

Deferred income taxes                                                     --                 136,588

Other assets                                                         114,853                  25,919

Separate account assets                                           24,349,395              32,349,347
                                                             ----------------      ------------------

                  Total assets                                   $53,478,103             $60,446,064
                                                             ================      ==================
</TABLE>


                             See accompanying notes.

                                       -3-
<PAGE>

                           IDS LIFE INSURANCE COMPANY
                           CONSOLIDATED BALANCE SHEETS
                       ($ thousands, except share amounts)
                                   (continued)
<TABLE>
<CAPTION>


                                                              September 30,          December 31,
LIABILITIES AND STOCKHOLDER'S EQUITY                              2001                   2000
------------------------------------                        ----------------      ------------------
                                                                (unaudited)
Liabilities:
    Future policy benefits:
<S>                                                              <C>                     <C>
       Fixed annuities                                           $19,408,793             $19,417,446
       Universal life-type insurance                               3,421,664               3,410,871
       Traditional life insurance                                    237,802                 232,913
       Disability income and
           long-term care insurance                                1,169,919               1,012,247
    Policy claims and other
       policyholders' funds                                           65,026                  52,067
    Amounts due to brokers                                           488,511                 446,347
    Deferred income taxes                                            170,379                      --
    Other liabilities                                                239,239                 459,422
    Separate account liabilities                                  24,349,395              32,349,347
                                                             ----------------      ------------------

                     Total liabilities                            49,550,728              57,380,660
                                                             ----------------      ------------------

Stockholder's equity:
    Capital stock, $30 par value per share;
       100,000 shares authorized, issued and outstanding               3,000                   3,000
    Additional paid-in capital                                       688,327                 288,327
    Accumulated other comprehensive income (loss),
        net of tax:
        Net unrealized securities gains (losses)                     375,914                (333,734)
        Net unrealized derivative losses                             (33,737)                     --
    Retained earnings                                              2,893,871               3,107,811
                                                             ----------------      ------------------

                     Total stockholder's equity                    3,927,375               3,065,404
                                                             ----------------      ------------------

Total liabilities and stockholder's equity                       $53,478,103             $60,446,064
                                                             ================      ==================
</TABLE>

                             See accompanying notes.

                                      -4-

<PAGE>



                           IDS LIFE INSURANCE COMPANY
                        CONSOLIDATED STATEMENTS OF INCOME
                                  ($ thousands)
                                   (unaudited)
<TABLE>
<CAPTION>
                                                                         Three months ended
                                                                           September 30,
                                                                    2001                   2000
                                                               ---------------       -----------------
<S>                                                                  <C>                    <C>
Revenues:
    Premiums:
       Traditional life insurance                                    $ 14,939               $ 13,257
       Disability income and
         long-term care insurance                                      64,914                 58,011
                                                               ---------------       -----------------
                                   Total premiums                      79,853                 71,268

    Policyholder and contractholder charges                           121,849                110,439
    Management and other fees                                         113,906                154,630
    Net investment income                                             390,826                413,367
    Net realized (loss) gain on investments                           (47,530)                 9,783
                                                               ----------------      -----------------
                                   Total revenues                     658,904                759,487
                                                               ----------------      -----------------

Benefits and expenses:
    Death and other benefits:
       Traditional life insurance                                       7,059                  7,059
       Universal life-type insurance
             and investment contracts                                  58,259                 33,523
       Disability income and
             long-term care insurance                                  11,717                  9,635
    Increase in liabilities for
       future policy benefits:
             Traditional life insurance                                 1,515                    773
             Disability income and
                long-term care insurance                               36,832                 31,891
    Interest credited on universal life-type
       insurance and investment contracts                             280,817                292,751
    Amortization of deferred policy
       acquisition costs                                               75,729                 91,350
    Other insurance and operating expenses                            105,721                 83,489
                                                               ---------------       -----------------
                                   Total benefits and expenses        577,649                550,471
                                                               ---------------       -----------------

Income before income tax expense                                       81,255                209,016

Income tax expense                                                      6,899                 51,520
                                                               ---------------       -----------------

Net income                                                           $ 74,356               $157,496
                                                               ===============       =================
</TABLE>

                             See accompanying notes.

                                      -5-

<PAGE>

                           IDS LIFE INSURANCE COMPANY
                        CONSOLIDATED STATEMENTS OF INCOME
                                  ($ thousands)
                                   (unaudited)
<TABLE>
<CAPTION>

                                                                            Nine months ended
                                                                              September 30,
                                                                       2001                   2000
                                                                  ---------------       -----------------
<S>                                                                   <C>                    <C>
Revenues:
    Premiums:
       Traditional life insurance                                     $   44,399             $   41,080
       Disability income and
         long-term care insurance                                        187,599                168,936
                                                                  ---------------       -----------------
                                   Total premiums                        231,998                210,016

    Policyholder and contractholder charges                              362,953                331,399
    Management and other fees                                            359,422                458,688
    Net investment income                                              1,064,770              1,321,314
    Net realized (loss) gain on investments                             (662,736)                   484
                                                                  ----------------      -----------------
                                   Total revenues                      1,356,407              2,321,901
                                                                  ----------------      -----------------

Benefits and expenses:
    Death and other benefits:
       Traditional life insurance                                         24,528                 22,773
       Universal life-type insurance
             and investment contracts                                    134,578                 95,189
       Disability income and
             long-term care insurance                                     33,173                 27,884
    Increase in liabilities for
       future policy benefits:
             Traditional life insurance                                    4,776                  4,047
             Disability income and
                long-term care insurance                                  90,697                 83,608
    Interest credited on universal life-type
       insurance and investment contracts                                849,318                888,420
    Amortization of deferred policy
       acquisition costs                                                 303,103                290,216
    Other insurance and operating expenses                               319,405                255,800
                                                                  ---------------       -----------------
                                   Total benefits and expenses         1,759,578              1,667,937
                                                                  ---------------       -----------------

(Loss) income before income tax (benefit) expense                       (403,171)               653,964

Income tax (benefit) expense                                            (198,682)               179,289
                                                                  ---------------       -----------------

Net (loss) income before cumulative effect of accounting change         (204,489)               474,675

Cumulative effect of accounting change (net of tax of $11,647):          (21,410)                    --
                                                                  ---------------       -----------------
     (note 4)
Net (loss) income                                                      $(225,899)              $474,675
                                                                  ===============       =================
</TABLE>

                             See accompanying notes.

                                      -6-
<PAGE>

                           IDS LIFE INSURANCE COMPANY
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                  ($ thousands)
                                   (unaudited)
<TABLE>
<CAPTION>

                                                                           Nine months ended
                                                                             September 30,
                                                                        2001                2000
                                                                   ----------------     --------------
Cash flows from operating activities:
<S>                                                                    <C>                     <C>
    Net (loss) income                                                  $(225,899)              $474,675

    Adjustments to reconcile net income to
       net cash provided by operating activities:
             Cumulative effect of accounting change, net of
                tax                                                       21,410                     --
             Policy loans, excluding universal
                Life-type insurance:
                  Issuance                                               (35,977)               (49,252)
                  Repayment                                               41,446                 42,057
             Change in amounts recoverable from reinsurers               (78,256)               (64,564)
             Change in other accounts receivable                          31,466                 (8,197)
             Change in accrued investment income                          47,626                 19,331
             Change in deferred policy
                acquisition costs, net                                   (98,787)              (210,722)
             Change in liabilities for future policy
                benefits for  traditional life,
                disability income and
                long-term care insurance                                 162,561                151,269
             Change in policy claims and other
                policyholders' funds                                      12,959                 36,616
             Change in deferred income taxes                             (51,897)                28,662
             Change in other assets                                      (88,934)                    --
             Change in other liabilities                                (220,183)               (74,907)
             Accretion of discount, net                                   90,538                 13,413
             Net realized loss on investments                            662,736                   (484)
             Policyholder and contractholder charges,
                non-cash                                                (159,857)              (109,984)
             Other, net                                                   22,739                 (4,230)
                                                                -----------------      -----------------

                Net cash provided by operating activities               $133,691               $243,683
                                                                -----------------     -----------------
</TABLE>

                                      -7-

<PAGE>

                                     IDS LIFE INSURANCE COMPANY
                                CONSOLIDATED STATEMENTS OF CASH FLOWS
                                            ($ thousands)
                                             (unaudited)
                                             (continued)
<TABLE>
<CAPTION>

                                                                         Nine months ended
                                                                           September 30,
                                                                    2001                   2000
                                                                ----------------      ------------------
Cash flows from investing activities:
   Fixed maturities held to maturity:
<S>                                                                  <C>                    <C>
       Purchases                                                     $        --            $       (34)
       Maturities, sinking fund payments and calls                            --                429,956
       Sales                                                                  --                 25,193
    Fixed maturities available for sale:
       Purchases                                                      (5,773,000)              (732,235)
       Maturities, sinking fund payments and calls                     1,896,793                763,611
       Sales                                                           3,015,367                830,997
    Other investments, excluding policy loans:
       Purchases                                                        (335,523)              (468,887)
       Sales                                                             273,411                289,985
    Change in amounts due from broker                                      6,113                 (1,521)
    Change in amounts due to broker                                       42,164                (70,224)
                                                                -----------------      ------------------

            Net cash (used in) provided by investing activities         (874,675)             1,066,841
                                                                -----------------      -----------------

Cash flows from financing activities:
    Activity related to universal life-type insurance
     and investment contracts:
       Considerations received                                         1,513,678              1,402,874
       Surrenders and death benefits                                  (2,201,427)            (2,984,364)
       Interest credited to account balances                             850,158                888,420
    Universal life-type insurance policy loans:
       Issuance                                                          (75,764)               (83,943)
       Repayment                                                          66,066                 36,638
    Cash dividends to parent                                                  --               (350,000)
    Capital contribution from parent                                     400,000                     --
                                                                 ----------------      ------------------

            Net cash provided by (used in) financing activities          552,711             (1,090,375)
                                                                -----------------      -----------------

Net (decrease) increase in cash and cash equivalents                    (188,273)               220,149

Cash and cash equivalents at beginning of period                         316,974                 32,333
                                                                -----------------      -----------------

Cash and cash equivalents at end of period                              $128,701               $252,482
                                                                =================      =================
</TABLE>


                             See accompanying notes.

                                      -8-

<PAGE>

                           IDS LIFE INSURANCE COMPANY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                               September 30, 2001
                                  ($ thousands)
                                   (unaudited)

1.       General

         In the opinion of the management of IDS Life Insurance Company (the
         Company), the accompanying unaudited consolidated financial statements
         contain all adjustments (consisting of normal recurring adjustments)
         necessary to present fairly its balance sheet as of September 30, 2001,
         statements of income for the three months and nine months ended
         September 30, 2001 and 2000 and statements of cash flows for the nine
         months ended September 30, 2001 and 2000.

         The Company is a wholly owned subsidiary of American Express Financial
         Corporation (AEFC), which is a wholly-owned subsidiary of American
         Express Company. The accompanying unaudited consolidated financial
         statements include the accounts of the Company and its wholly owned
         subsidiaries, IDS Life Insurance Company of New York, American
         Enterprise Life Insurance Company, American Centurion Life Assurance
         Company, American Partners Life Insurance Company and American Express
         Corporation. All material intercompany accounts and transactions have
         been eliminated in consolidation.

2.       Comprehensive Income

         Total comprehensive income was $336,313 and $255,849 for the three
         months and $450,212 and $459,890 for the nine months ended September
         30, 2001 and 2000, respectively.

3.       Statements of cash flows

         Cash paid for interest on borrowings totaled $17,734 and $3,072 for the
         nine months ended September 30, 2001 and 2000, respectively. Cash
         received from income taxes totaled $69,751 for the nine months ended
         September 30, 2001 compared to cash paid of $146,931 for the nine
         months ended September 30, 2000.


                                      -9-

<PAGE>


                           IDS LIFE INSURANCE COMPANY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  ($ thousands)
                                   (unaudited)
                                   (continued)

4.       Accounting developments

         In July 2000, the FASB's Emerging Issues Task Force (EITF) issued a
         consensus on Issue 99-20, "Recognition of Interest Income and
         Impairment on Purchased and Retained Beneficial Interests in
         Securitized Financial Assets." The Company elected to early adopt the
         consensus as of January 1, 2001. Issue 99-20 prescribes new procedures
         for recording interest income and measuring impairment on retained and
         purchased beneficial interests. Adoption of the consensus required the
         Company to adjust the carrying amount of these investments downward by
         $21,410, net of tax as of January 1, 2001.

         In June 1998, the Financial Accounting Standards Board (FASB)
         issued, and subsequently amended, Statement of Financial Accounting
         Standards (SFAS) No. 133, "Accounting for Derivative Instruments and
         Hedging Activities," which the Company adopted on January 1, 2001. This
         Statement establishes accounting and reporting standards for derivative
         instruments, including those embedded in other contracts, and hedging
         activities. It requires that an entity recognize all derivatives as
         either assets or liabilities on the balance sheet and measure those
         instruments at fair value.

         Changes in the fair value of a derivative are recorded in income or
         directly to equity, depending on the instrument's designated use. For
         those derivative instruments that are designated and qualify as hedging
         instruments under SFAS 133, a company must designate the hedging
         instrument, based upon the exposure being hedged, as either a fair
         value hedge, cash flow hedge or a hedge of a net investment in a
         foreign operation. For derivative instruments not designated as hedging
         instruments per SFAS 133, changes in fair value are adjusted
         immediately through earnings. Currently, IDSL does not carry
         derivatives that are designated or qualify as hedging instruments under
         SFAS 133.

         Because of changes to the rules for hedging investments, the transition
         provisions of SFAS 133, as amended, permitted a one-time opportunity
         for held-to-maturity securities to be reclassified at the date of
         adoption to available-for-sale or trading. The  adoption  of SFAS 133
         did not have a  significant  impact  on the Company's financial
         condition or results of operations.

                                      -10-
<PAGE>


                           IDS LIFE INSURANCE COMPANY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  ($ thousands)
                                   (unaudited)
                                   (continued)


5.       Commitments and contingencies

         Commitments for purchases of investments in the ordinary course of
         business at September 30, 2001 aggregated $91,293.

         The maximum amount of life insurance risk retained by the Company is
         $750 on any policy insuring a single life and $1,500 on any policy
         insuring a joint-life combination. The Company retains only 20% of the
         mortality risk on new variable universal life insurance policies and
         10% of the risk on new term insurance policies. Risk not retained is
         reinsured with other life insurance companies, primarily on a yearly
         renewable term basis. Long-term care policies are primarily reinsured
         on a coinsurance basis. The Company retains all accidental death
         benefit, disability income and waiver of premium risk.

         A number of lawsuits have been filed against life and health insurers
         in jurisdictions in which IDS Life and its affiliates do business
         involving insurers' sales practices, alleged agent misconduct, failure
         to properly supervise agents and other matters relating to life
         insurance policies and annuity contracts. IDS Life and its affiliates ,
         like other life and health insurers, from time to time are involved in
         such litigation. IDS Life was a named defendant in three class action
         lawsuits of this nature. On December 13, 1996, an action entitled Lesa
         Benacquisto and Daniel Benacquisto v. IDS Life Insurance Company and
         American Express Financial Corporation was commenced in Minnesota state
         court. A second action, entitled Arnold Mork, Isabella Mork, Ronald
         Melchert and Susan Melchert v. IDS Life Insurance Company and American
         Express Financial Corporation was commenced in the same court on March
         21, 1997.

         On October 13, 1998, an action entitled Richard W. and Elizabeth J.
         Thoresen v. American Express Financial Corporation, American Centurion
         Life Assurance Company, American Enterprise Life Insurance Company,
         American Partners Life Insurance Company, IDS Life Insurance Company
         and IDS Life Insurance Company of New York was also commenced in
         Minnesota state court. These lawsuits included allegations of improper
         insurance and annuity sales practices including improper replacement of
         existing annuity contracts and insurance policies and improper use of
         annuities to fund tax deferred contributory retirement plans.

         In January 2000, AEFC reached an agreement in principle to settle the
         three class-action lawsuits described above. It is expected the
         settlement will provide $215 million of benefits to more than two
         million participants and for release by class members of all insurance
         and annuity market conduct claims dating back to 1985.



                                   -11-
<PAGE>


                           IDS LIFE INSURANCE COMPANY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  ($ thousands)
                                   (unaudited)
                                   (continued)

5.       Commitments and contingencies (continued)

         In August, 2000 an action entitled Lesa Benacquisto, Daniel
         Benacquisto, Richard Thoresen, Elizabeth Thoresen, Arnold Mork,
         Isabella Mork, Ronald Melchert and Susan Melchert v. American Express
         Financial Corporation, American Express Financial Advisors, American
         Centurion Life Assurance Company, American Enterprise Life Insurance
         Company, American Partners Life Insurance Company, IDS Life Insurance
         Company and IDS Life Insurance Company of New York was commenced in the
         United States District Court for the District of Minnesota. The
         complaint put at issue various alleged sales practices and
         misrepresentations and allegations of violations of federal laws.

         In May, 2001 the United States District Court for the State of
         Minnesota and The District Court, Fourth Judicial District for the
         State of Minnesota, County of Hennepin entered orders approving the
         settlement as tentatively reached in January, 2000. Appeals were filed
         in both federal and state court but subsequently dismissed by the
         parties filing the appeals. The orders approving the settlement were
         final as of September 24, 2001. Implementation of the settlement
         commenced October 15, 2001. Numerous individuals opted out of the
         settlement. Although a significant number of these individuals are
         represented by counsel, to date very few have filed lawsuits against
         IDS Life.

         The Company is named as a defendant in various other lawsuits. The
         outcome of any litigation cannot be predicted with certainty. In the
         opinion of management, however, the ultimate resolution of these
         lawsuits taken in aggregate should not have a material adverse effect
         on the Company's consolidated financial position or results of
         operations.

6.       Investments

         Net income for the nine month period ended September 30, 2001 includes
         a $166  million  pretax  charge to  investment  income  in the  second
         quarter and a $227 million  pretax  capital loss in the second quarter
         to  recognize  the  impact  of  higher  default  assumptions  on rated
         structured  investments,  which reflect rising actual default rates in
         the corporate high-yield bond market.

         Additionally, net income for the nine month period ended September 30,
         2001 reflects a $262 million pretax writedown of high-yield securities
         in the second quarter primarily reflecting management's decision to
         reduce and rebalance the high-yield risk exposure in the fixed maturity
         investment portfolio.



                                      -12-
<PAGE>


                           IDS LIFE INSURANCE COMPANY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                  ($ thousands)
                                   (unaudited)
                                   (continued)

7.       Stockholder's Equity

         During the third quarter 2001, the Company received a $400 million cash
         capital contribution from its parent, American Express Financial
         Corporation.

8.       Subsequent Event

         Early in the fourth  quarter of 2001, the company placed a majority of
         its rated  Collateralized Debt Obligation (CDO) securities and related
         accrued interest, as well as a relatively minor amount of other liquid
         securities,  having an  aggregate  book value of $675  million  into a
         securitization  trust. In return,  the company received $90 million in
         cash (excluding  transaction expenses) relating to sales to investors,
         and retained  interests with allocated book amounts  aggregating  $585
         million.  An immaterial amount of realized losses relating to the CDOs
         designated for this transaction was recorded as of September 30, 2001.

9.       Disaster Recovery Charges

         Included in benefits and expenses is $11 million related to the
         September 11, 2001 terrorist attacks.

                                      -13-

<PAGE>

MANAGEMENT'S DISCUSSION AND ANALYSIS OF CONSOLIDATED FINANCIAL CONDITION AND
RESULTS OF OPERATIONS

Results of Operations

Nine months Ended September 30, 2001 Compared to Nine months Ended September 30,
2000:

Consolidated net loss was $226 million for the nine months ended September 30,
2001, compared to net income of $475 million for the nine months ended September
30, 2000. This decline was primarily the result of a $663 million pretax loss on
investments and a $256 million decrease in investment income.

Premiums received totaled $4.3 billion for the nine months ended September 30,
2001, compared to $5.3 billion in 2000. The premium reduction is primarily due
to decreased sales of variable annuities.

Management and other fees decreased to $359 million for the nine months ended
September 30, 2001 compared with $459 million a year ago. This decrease reflects
a decrease in average separate account assets outstanding, resulting
primarily from market depreciation of equity securities. The Company provides
investment management services for many of the mutual funds that are available
as investment options for variable annuities and variable life insurance. The
Company also receives a mortality and expense risk fee from the separate
accounts.

Net investment income decreased to $1,065 million for the nine months ended
September 30, 2001 compared to $1,321 million a year ago. This is primarily due
to lower investment yields, reflecting credit-related yield adjustments on fixed
maturity investments.

Net loss on investments was $663 million for the nine months ended September 30,
2001,  compared to net gains of $.5 million for the nine months ended  September
30, 2000. The net loss for the nine months ended September 30, 2001 was composed
of a $143 million pretax net loss in the first quarter resulting  primarily from
the  recognition  of  impairment  losses  and  the  sale of  certain  high-yield
securities,  a $227  million  writedown in the second  quarter to recognize  the
impact of higher default rate assumptions on certain structured  investments and
a $262 million  writedown of lower-rated  securities (most of which were sold in
the third quarter of 2001) in the second  quarter  primarily in connection  with
the Company's  decision to reduce and rebalance  high-yield risk exposure in the
fixed  maturity  investment  portfolio  during the second half of 2001,  and $31
million of other net losses on the sale and write-down of investments.

Total benefits and expenses were $1.8 billion for the nine months ended
September 30, 2001, an increase of 5 percent from a year ago. This increase is
primarily due to increases in death benefits and general expenses.

                                      -14-
<PAGE>

MANAGEMENT'S DISCUSSION AND ANALYSIS OF CONSOLIDATED FINANCIAL CONDITION AND
RESULTS OF OPERATIONS (continued)

The largest component of expenses, interest credited on universal life-type
insurance and investment contracts, decreased 4 percent to $849 million. This
was primarily due to lower aggregate amounts of fixed annuities in force.

Other insurance and operating expenses increased 25 percent as a result of
business growth and technology costs related to growth initiatives.

Liquidity and Capital Resources

The liquidity requirements of the Company are met by funds provided from
operations and investment activity. The primary components of the funds provided
are premiums, investment income, proceeds from sales of investments as well as
maturities and periodic repayments of investment principal.

The primary uses of funds are policy benefits, commissions and operating
expenses, policy loans, new investment purchases and dividends to parent.

The Company has an available line of credit with its parent of $200 million
($100 million committed and $100 million uncommitted). This line of credit is
used strictly as a short-term source of funds. At September 30, 2001,
outstanding borrowings under this agreement were $50 million. The Company also
uses reverse repurchase agreements for short-term liquidity needs. Outstanding
reverse repurchase agreements totaled $49 million at September 30, 2001.

At September 30, 2001, approximately 5 percent of the Company's invested assets
were below-investment-grade bonds, compared to 15 percent at December 31, 2000.
These investments may be subject to a higher degree of risk than higher-rated
issues because of the borrowers' generally greater sensitivity to adverse
economic conditions, such as recession or increasing interest rates, and in
certain instances the lack of an active secondary market. Expected returns on
below-investment-grade bonds reflect consideration of such factors. The Company
has identified those fixed maturities for which a decline in fair value is
determined to be other than temporary, and has written them down to fair value
with a charge to earnings.

During the fourth quarter of 2001, the Company completed a transaction that
placed a large portion of its rated Collateralized Debt Obligation (CDO)
securities into a securitization trust. The transaction has the following
consequences:

o  It  pools  the  performance  of  30  separate  CDO   securities,   allowing
   recognition of the investment return related to the overall  performance of
   the portfolio.  The ability to evaluate  future cash flows at the portfolio
   level,  rather than on a security  by-security  basis,  should increase the
   predictability of future performance; and

                                      -15-
<PAGE>

MANAGEMENT'S DISCUSSION AND ANALYSIS OF CONSOLIDATED FINANCIAL CONDITION AND
RESULTS OF OPERATIONS (continued)

o  It monetizes a small portion of the CDO securities by selling notes in this
   structure to third-party investors.

At September 30, 2001, the Company had an allowance for losses on mortgage loans
of $21 million.

                                      -16-

<PAGE>

MANAGEMENT'S DISCUSSION AND ANALYSIS OF CONSOLIDATED FINANCIAL CONDITION AND
RESULTS OF OPERATIONS

PART II - OTHER INFORMATION

Item 1.           LEGAL PROCEEDINGS

                  Reference is made to Note 5 of the Notes to Consolidated
                  Financial Statements (unaudited) contained in the Report filed
                  on Form 10-Q for the quarterly period ended September 30,
                  2001.

Item 2.           CHANGES IN SECURITIES AND USE OF PROCEEDS

                  Not applicable.

Item 3.           DEFAULTS UPON SENIOR SECURITIES

                  Not applicable.

Item 4.           SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

                  Not applicable.

Item 5.           OTHER INFORMATION

                  Not applicable.

Item 6.           EXHIBITS AND REPORTS ON FORM 8-K

                    (a)  Exhibits

                    3.1  Copy  of  Certificate  of  Incorporation  of  IDS  Life
                         Insurance  Company filed  electronically as Exhibit 3.1
                         to  Post  Effective  Amendment  No.  5 to  Registration
                         Statement  No.  33-28976  is  incorporated   herein  by
                         reference.

                    3.2  Copy  of the  Amended  By-laws  of IDS  Life  Insurance
                         Company   filed   electronically   as  Exhibit  3.2  to
                         Post-Effective   Amendment   No.   5  to   Registration
                         Statement  No.  33-28976  is  incorporated   herein  by
                         reference.

                    3.3  Copy of  Resolution  of the Board of  Directors  of IDS
                         Life Insurance Company, dated May 5, 1989, establishing
                         IDS Life  Account MGA filed  electronically  as Exhibit
                         3.3 to  Post-Effective  Amendment No. 5 to Registration
                         Statement  No.  33-28976  is  incorporated   herein  by
                         reference.

                                      -17-

<PAGE>

PART II - OTHER INFORMATION (continued)

                    4.1  Copy of Non-tax qualified Group Annuity Contract,  Form
                         30363C,   filed   electronically   as  Exhibit  4.1  to
                         Post-Effective   Amendment   No.   5  to   Registration
                         Statement  No.  33-28976  is  incorporated   herein  by
                         reference.

                    4.2  Copy of Non-tax  qualified  Group Annuity  Certificate,
                         Form  30360C,  filed  electronically  as Exhibit 4.2 to
                         Post-Effective   Amendment   No.   5  to   Registration
                         Statement  No.  33-28976  is  incorporated   herein  by
                         reference.

                    4.3  Copy of Endorsement No.  30340C-GP to the Group Annuity
                         Contract  filed   electronically   as  Exhibit  4.3  to
                         Post-Effective   Amendment   No.   5  to   Registration
                         Statement  No.  33-28976  is  incorporated   herein  by
                         reference.

                    4.4  Copy of  Endorsement  No.  30340C to the Group  Annuity
                         Certificate  filed  electronically  as  Exhibit  4.4 to
                         Post-Effective   Amendment   No.   5  to   Registration
                         Statement  No.  33-28976  is  incorporated   herein  by
                         reference.

                    4.5  Copy of Tax  qualified  Group  Annuity  Contract,  Form
                         30369C,   filed   electronically   as  Exhibit  4.5  to
                         Post-Effective   Amendment   No.  10  to   Registration
                         Statement  No.  33-28976  is  incorporated   herein  by
                         reference.

                    4.6  Copy of Tax qualified Group Annuity  Certificate,  Form
                         30368C,   filed   electronically   as  Exhibit  4.6  to
                         Post-Effective   Amendment   No.  10  to   Registration
                         Statement  No.  33-28976  is  incorporated   herein  by
                         reference.

                    4.7  Copy of Group IRA Annuity Contract,  Form 30372C, filed
                         electronically   as  Exhibit   4.7  to   Post-Effective
                         Amendment No. 10 to Registration Statement No. 33-28976
                         is incorporated herein by reference.

                    4.8  Copy of Group IRA  Annuity  Certificate,  Form  30371C,
                         filed  electronically  as Exhibit 4.8 to Post-Effective
                         Amendment No. 10 to Registration Statement No. 33-28976
                         is incorporated herein by reference.

                    4.9  Copy of Non-tax qualified  Individual Annuity Contract,
                         Form  30365D,  filed  electronically  as Exhibit 4.9 to
                         Post-Effective   Amendment   No.  10  to   Registration
                         Statement  No.  33-28976  is  incorporated   herein  by
                         reference.

                                      -18-

<PAGE>

PART II - OTHER INFORMATION (continued)

                    4.10 Copy of Endorsement No. 30379 to the Individual Annuity
                         Contract,  filed  electronically  as  Exhibit  4.10  to
                         Post-Effective   Amendment   No.  10  to   Registration
                         Statement  No.  33-28976  is  incorporated   herein  by
                         reference.

                    4.11 Copy of Tax qualified Individual Annuity Contract, Form
                         30370C,   filed   electronically  as  Exhibit  4.11  to
                         Post-Effective   Amendment   No.  10  to   Registration
                         Statement  No.  33-28976  is  incorporated   herein  by
                         reference.

                    4.12 Copy of Individual IRA Annuity  Contract,  Form 30373C,
                         filed  electronically as Exhibit 4.12 to Post-Effective
                         Amendment No. 10 to Registration Statement No. 33-28976
                         is incorporated herein by reference.

                    4.13 Copy of Endorsement No. 33007 filed  electronically  as
                         Exhibit  4.13 to  Post-Effective  Amendment  No.  12 to
                         Registration  Statement  No.  33-28976 is  incorporated
                         herein by reference.

                    4.14 Copy of Group  Annuity  Contract,  Form  30363D,  filed
                         electronically   as  Exhibit   4.1  to   Post-Effective
                         Amendment No. 2 to Registration  Statement No. 33-50968
                         is incorporated herein by reference.

                    4.15 Copy of Group Annuity  Certificate,  Form 30360D, filed
                         electronically   as  Exhibit   4.2  to   Post-Effective
                         Amendment No. 2 to Registration  Statement No. 33-50968
                         is incorporated herein by reference.

                    4.16 Form of Deferred Annuity Contract,  Form 30365E,  filed
                         electronically   as  Exhibit   4.3  to   Post-Effective
                         Amendment No. 2 to Registration  Statement No. 33-50968
                         is incorporated herein by reference.

                    4.17 Copy of Group Deferred Variable Annuity Contract,  Form
                         34660,   filed   electronically   as  Exhibit   4.1  to
                         Post-Effective   Amendment   No.   2  to   Registration
                         Statement  No.  33-48701  is  incorporated   herein  by
                         reference.

                    4.18 Copy of Non-tax qualified Group Annuity Contract,  Form
                         33111,   filed   electronically   as  Exhibit   4.1  to
                         Registration  Statement No.  333-42793 is  incorporated
                         herein by reference.

                                      -19-

<PAGE>

PART II - OTHER INFORMATION (continued)

                    4.19 Copy of Non-tax  qualified  Group Annuity  Certificate,
                         Form  33114,  filed  electronically  as Exhibit  4.2 to
                         Registration  Statement No.  333-42793 is  incorporated
                         herein by reference.

                    4.20 Copy of Tax  qualified  Group  Annuity  Contract,  Form
                         33112,   filed   electronically   as  Exhibit   4.3  to
                         Registration  Statement No.  333-42793 is  incorporated
                         herein by reference.

                    4.21 Copy of Tax qualified Group Annuity  Certificate,  Form
                         33115,   filed   electronically   as  Exhibit   4.4  to
                         Registration  Statement No.  333-42793 is  incorporated
                         herein by reference.

                    4.22 Copy of Group IRA Annuity Contract,  Form 33113,  filed
                         electronically as Exhibit 4.5 to Registration Statement
                         No. 333-42793 is incorporated herein by reference.

                    4.23 Copy of Group  IRA  Annuity  Certificate,  Form  33116,
                         filed  electronically  as Exhibit  4.6 to  Registration
                         Statement  No.  333-42793  is  incorporated  herein  by
                         reference.

                    4.24 Copy of Non-tax qualified  Individual Annuity Contract,
                         Form  30484,  filed  electronically  as Exhibit  4.7 to
                         Post-Effective   Amendment   No.   1  to   Registration
                         Statement  No.  333-42793  is  incorporated  herein  by
                         reference.

                    4.25 Copy of Tax qualified Individual Annuity Contract, Form
                         30485,   filed   electronically   as  Exhibit   4.8  to
                         Post-Effective   Amendment   No.   1  to   Registration
                         Statement  No.  333-42793  is  incorporated  herein  by
                         reference.

                    4.26 Copy of  Individual  IRA  Contract,  Form 30486,  filed
                         electronically   as  Exhibit   4.9  to   Post-Effective
                         Amendment No. 1 to Registration Statement No. 333-42793
                         is incorporated herein by reference.

                    21.  Copy of List of Subsidiaries  filed  electronically  as
                         Exhibit  21  to  Post-Effective   Amendment  No.  7  to
                         Registration   Statement   No.   33-28976   is   herein
                         incorporated by reference.

                                      -20-
<PAGE>

PART II - OTHER INFORMATION (continued)


                    27.  Financial data schedule is filed electronically
                         herewith.

                    (b)  No reports on Form 8-K were required to be filed by the
                    Company for the three months ended September 30, 2001.

                                      -21-
<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.

REGISTRANT                                  IDS LIFE INSURANCE COMPANY

BY                                      /s/ Philip C. Wentzel
                                            -----------------
NAME AND TITLE                              Philip C. Wentzel
                                            Vice President and Controller

DATE                                        November 12, 2001



                                      -22-