FORM 10-Q
                      SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C. 20549

                  QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
                    OF THE SECURITIES EXCHANGE ACT OF 1934



                For the Quarterly Period Ended: JUNE 30, 1997 
                        Commission File Number: 0-10306

                    INDEPENDENCE HOLDING COMPANY            
      ------------------------------------------------------              
      (Exact name of registrant as specified in its charter)
                                       


        DELAWARE                       58-1407235               
------------------------    ------------------------------------        
(State of Incorporation)    (I.R.S. Employer Identification No.)


96 CUMMINGS POINT ROAD, STAMFORD, CONNECTICUT            06902  
----------------------------------------------------------------
(Address of principal executive offices)              (Zip Code)



Registrant's telephone number, including area code: (203) 358-8000


                          NOT APPLICABLE                         
------------------------------------------------------------------
Former name, former address and 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    .
                         ---     ---

       7,431,769 SHARES OF COMMON STOCK, $1.00 PAR VALUE         
       -------------------------------------------------
         Common Stock outstanding as of August 8, 1997

<PAGE>
                 
                 INDEPENDENCE HOLDING COMPANY AND SUBSIDIARIES

                                     INDEX




PART 1 - FINANCIAL INFORMATION                         PAGE NO.
------------------------------                         --------
  Consolidated Balance Sheets -
   June 30, 1997 (unaudited) and December 31, 1996..          2
 
  Consolidated Statements of Operations -
   Three Months and Six Months Ended June 30, 1997 
   and 1996 (unaudited).............................          3

  Consolidated Statements of Cash Flows -
   Six Months Ended June 30, 1997 
   and 1996 (unaudited).............................          4

  Notes to Consolidated Financial Statements
   (unaudited)......................................     5 - 10

  Management's Discussion and Analysis of Results of
   Operations and Financial Condition...............    11 - 17


PART II - OTHER INFORMATION
---------------------------
  Item 4 - Submission of Matters to a Vote  
   of Security Holders..............................         18

  Item 6 - Exhibits and Reports on Form 8-K.........         18

  Signatures........................................         19


                               1

<PAGE>

INDEPENDENCE HOLDING COMPANY AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS                         JUNE 30,   DECEMBER 31,
                                                      1997          1996       
----------------------------------------------------------------------------
                                                  (UNAUDITED)
ASSETS:
  Cash and cash equivalents......................$  6,239,000   $ 10,361,000
   Short-term investments........................  13,352,000     10,316,000
   Securities purchased under agreements 
    to resell....................................  17,024,000     36,542,000
   Fixed maturities (Note 3)..................... 169,980,000    165,040,000
   Equity securities (Note 3)....................  10,885,000      4,427,000
   Other investments.............................  37,350,000     32,683,000
                                                  -----------    -----------
      Total investments.......................... 248,591,000    249,008,000
  Deferred insurance acquisition costs...........  11,234,000     11,221,000
  Due and unpaid premiums........................   6,912,000      5,122,000
  Due from reinsurers............................  64,068,000     50,877,000
  Due from brokers...............................   8,605,000          -    
  Notes and other receivables....................   4,440,000      4,205,000
  Other assets...................................   6,676,000      5,607,000
                                                  -----------    -----------
      TOTAL ASSETS...............................$356,765,000   $336,401,000
                                                  ===========    ===========
LIABILITIES AND STOCKHOLDERS' EQUITY:
 LIABILITIES:
  Future policy benefits.........................$131,640,000   $115,594,000
  Unearned premiums..............................  12,780,000     11,654,000
  Funds on deposit...............................  66,466,000     68,915,000
  Insurance policy claims........................   3,794,000      3,914,000
  Other policyholders' funds.....................   2,230,000      2,201,000
  Financial instruments sold, but not yet
   purchased (Note 3)............................      43,000        539,000
  Due to brokers.................................  18,088,000     19,740,000
  Due to reinsurers..............................   9,564,000      6,764,000
  Accounts payable, accruals and other
   liabilities...................................  17,285,000     18,653,000 
  Liability for business transferred.............   7,905,000      7,905,000
  Income taxes...................................   3,763,000      3,666,000
                                                  -----------    -----------
      TOTAL LIABILITIES.......................... 273,558,000    259,545,000
                                                  -----------    -----------
STOCKHOLDERS' EQUITY:                      
Preferred Stock (none issued)....................       -              -
Common stock, 7,431,769 shares issued and 
 outstanding, net of 2,188,950 shares in
 treasury........................................   7,432,000      7,432,000
Paid-in capital..................................  76,068,000     76,068,000
Unrealized losses on investments, net (Note 6)...    (566,000)    (1,466,000)
Retained earnings (accumulated deficit)..........     273,000     (5,178,000)
                                                  -----------    -----------
      TOTAL STOCKHOLDERS' EQUITY.................  83,207,000     76,856,000
                                                  -----------    -----------
      TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY.$356,765,000   $336,401,000
                                                  ===========    ===========
         See Accompanying Notes to Consolidated Financial Statements.


                                        2
<PAGE>

INDEPENDENCE HOLDING COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
                        THREE MONTHS ENDED JUNE 30,  SIX MONTHS ENDED JUNE 30, 
                             1997         1996           1997         1996 
-------------------------------------------------------------------------------
REVENUES:
 Insurance premiums.....$ 20,073,000 $ 17,095,000   $ 38,822,000 $ 33,548,000
 Net investment income..   5,535,000    5,012,000      9,717,000    8,705,000
 Net realized and                                    
  unrealized losses.....    (294,000)    (828,000)      (151,000)    (661,000)
 Equity income (loss)...       2,000      (21,000)        79,000       76,000
 Other income...........    (389,000)     629,000        864,000    2,064,000
                          ----------   ----------     ----------   ----------
                          24,927,000   21,887,000     49,331,000   43,732,000
                          ----------   ----------     ----------   ----------
EXPENSES:
 Insurance benefits, 
  claims and reserves...  12,998,000   12,550,000     27,062,000   24,626,000
 Amortization of         
  deferred insurance 
  acquisition costs.....     743,000    1,150,000      1,454,000    2,222,000
 Interest expense.......       -          230,000          -          465,000
 Selling, general and 
  administrative        
  expenses..............   7,841,000    6,835,000     14,908,000   13,919,000
                          ----------   ----------     ----------   ----------
                          21,582,000   20,765,000     43,424,000   41,232,000
                          ----------   ----------     ----------   ----------
Operating income     
 before income taxes....   3,345,000    1,122,000      5,907,000    2,500,000
Income tax expense
 (benefit)..............     154,000     (347,000)       456,000     (332,000)
                          ----------   ----------     ----------   ----------
Income from continuing
 operations, net........   3,191,000    1,469,000      5,451,000    2,832,000

Income from discontinued
 operations, net........       -          596,000          -        1,027,000
                          ----------   ----------     ----------   ----------
Net income.............. $ 3,191,000  $ 2,065,000    $ 5,451,000  $ 3,859,000 
                          ==========   ==========     ==========   ==========

INCOME PER COMMON SHARE:
Income from continuing
 operations............. $       .43  $       .20    $       .73  $       .38
Income from discontinued                           
 operations, net........       -              .08          -              .14
                          ----------   ----------     ----------   ----------
Net income.............. $       .43  $       .28    $       .73  $       .52
                          ==========   ==========     ==========   ==========
WEIGHTED AVERAGE COMMON 
 SHARES OUTSTANDING.....   7,493,000    7,499,000      7,483,000    7,483,000  
                          ==========   ==========     ==========   ==========
         See Accompanying Notes to Consolidated Financial Statements.

                                         3

<PAGE>

INDEPENDENCE HOLDING COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
SIX MONTHS ENDED JUNE 30,                             1997          1996    
----------------------------------------------------------------------------
CASH FLOWS FROM OPERATING ACTIVITIES:
 Net income.......................................$  5,451,000  $  3,859,000
 Adjustment to reconcile net income to net cash
  provided by operating activities:                         
 Amortization of deferred insurance acquisition
  costs...........................................   1,454,000     2,222,000
 Realized losses on sales of  
  investment securities...........................      59,000       133,000 
 Unrealized losses on trading securities..........      92,000       528,000 
 Equity income....................................     (79,000)      (76,000)
 Depreciation.....................................     198,000       144,000
 Deferred taxes...................................     248,000      (135,000)
 Income from discontinued operations, net.........       -        (1,027,000)
 Other............................................  (3,599,000)   (1,800,000)
Change in assets and liabilities:
 Net purchases of trading securities..............  (1,947,000)     (390,000)
 Increase in future insurance policy benefits,
  claims and other policy liabilities.............  15,579,000    31,261,000 
 Additions to deferred insurance acquisition
  costs...........................................  (1,467,000)   (3,940,000)
 Change in net amounts due from and to reinsurers. (10,391,000)    5,853,000 
 Change in income tax liability...................    (249,000)      (62,000)
 Other............................................  (3,515,000)   (1,139,000)
                                                   -----------   -----------
        Net cash provided by operating activities.   1,834,000    35,431,000 
                                                   -----------   -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
 Change in net amount due from and to brokers..... (10,256,000)   (6,989,000)
 Sales and maturities of short-term investments...  22,226,000    13,309,000
 Purchases of short-term investments.............. (25,250,000)  (15,276,000)
 Net purchases of resale agreements...............  19,519,000   (14,641,000)
 Sales and maturities of fixed maturities.........  57,584,000    93,844,000
 Purchases of fixed maturities.................... (62,213,000) (119,278,000)
 Sales of equity securities.......................  15,348,000    11,962,000
 Purchases of equity securities................... (19,874,000)  (13,327,000)
 Proceeds on sale of other investments............   2,559,000     3,200,000
 Other investments, net...........................  (3,462,000)   (6,529,000)
 Discontinued operations, net.....................       -            68,000
 Other............................................    (818,000)     (514,000)  
                                                   -----------   -----------
        Net cash used by investing activities.....  (4,637,000)  (54,171,000)
                                                   -----------   -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
 Repurchase of common stock and warrants..........       -            (5,000)
 Payments of investment-type insurance contracts..    (947,000)     (866,000)
 Payment of long-term debt........................       -        (2,000,000)
 Dividends paid...................................    (372,000)     (297,000)
                                                   -----------   -----------
        Net cash used by financing activities.....  (1,319,000)   (3,168,000)
                                                   -----------   -----------
Decrease in cash and cash equivalents.............  (4,122,000)  (21,908,000)
Cash and cash equivalents, beginning of year......  10,361,000    26,860,000
                                                   -----------   -----------
Cash and cash equivalents, end of period..........$  6,239,000  $  4,952,000
                                                   ===========   ===========
         See Accompanying Notes to Consolidated Financial Statements.

                                      4 
                                      
<PAGE>


INDEPENDENCE HOLDING COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 1997   
(UNAUDITED)
-------------------------------------------------------------------------
NOTE 1. SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES

      (A)  BUSINESS AND ORGANIZATION

      Independence Holding Company and subsidiaries ("IHC") is a
holding company engaged principally in the life and health
insurance business through its wholly-owned subsidiaries, Standard
Security Life Insurance Company of New York ("Standard Life"),
Madison National Life Insurance Company, Inc. ("Madison Life") and
First Standard Security Insurance Company ("First Standard") and
their subsidiaries (the "Insurance Group").  IHC and its
subsidiaries (including the Insurance Group) are collectively
referred to as the "Company."
      Geneve Corporation, a diversified financial holding company,
and its affiliated entities (collectively "Geneve") hold
approximately 55% of IHC's outstanding common stock.

      (B)  PRINCIPLES OF CONSOLIDATION

      The consolidated financial statements have been prepared in
accordance with the requirements for quarterly reports on Form 10-
Q. In the opinion of management, all adjustments (consisting only
of normal recurring accruals) that are necessary for a fair
presentation of the consolidated results of operations for the
interim periods have been included. The consolidated results of
operations for the three months and six months ended June 30, 1997
are not necessarily indicative of the results to be anticipated for
the entire year.  The consolidated financial statements should be
read in conjunction with the consolidated financial statements and
the notes included in IHC's Annual Report on Form 10-K for the year
ended December 31, 1996.  Certain amounts in prior year's
consolidated financial statements and notes thereto have been
restated to conform to the 1997 presentation.
      The preparation of financial statements in conformity with
generally accepted accounting principles requires management to
make estimates and assumptions that affect: (i) the reported
amounts of assets and liabilities, (ii) the disclosure of
contingent assets and liabilities at the date of the financial
statements and (iii) the reported amounts of revenues and expenses
during the reporting period.  Actual results could differ from
those estimates. 

                           
                               5

<PAGE>
      
INDEPENDENCE HOLDING COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
------------------------------------------------------------------------
NOTE 2. DISCONTINUED OPERATIONS

      On December 31, 1996, IHC consummated the distribution of the
common stock of Zimmerman on a pro rata basis to holders of record
of IHC's common stock as of December 20, 1996.  In connection with
the distribution of Zimmerman, a subsidiary of the Company has
guaranteed $10,000,000 of subordinated debt of Zimmerman.
Accordingly, the credit to stockholders' equity of $7,905,000 or
$1.06 per share that would have been recorded upon consummation of
the distribution of Zimmerman has been deferred until such time as
the subordinated debt is repaid or the guarantee is eliminated.
      Since Zimmerman historically comprised all of IHC's
manufacturing segment, the Consolidated Financial Statements and
notes thereto of IHC present Zimmerman as discontinued operations.

NOTE 3. INVESTMENT SECURITIES          

      The cost (amortized cost with respect to certain fixed
maturities) and fair value of IHC's investment securities as of
June 30, 1997 and December 31, 1996 are as follows:

                                               JUNE 30, 1997                   
                           -----------------------------------------------
                                           GROSS          GROSS
                           AMORTIZED     UNREALIZED     UNREALIZED    FAIR
                             COST          GAINS         (LOSSES)    VALUE     
                           -----------------------------------------------  
                                       (DOLLARS IN THOUSANDS)               
FIXED MATURITIES
----------------
 AVAILABLE-FOR-SALE:
  Corporate securities......$ 23,170     $    174     $   (727)     $ 22,617 
  U.S. Government and
   agencies obligations.....  35,582          126         (812)       34,896
  Government National
   Mortgage Association..... 110,167          312         (312)      110,167
  Obligations of states and
   political subdivisions...   2,353           44          (97)        2,300
                             -------      -------      -------       -------
Total fixed maturities      $171,272     $    656     $ (1,948)     $169,980
                             =======      =======      =======       =======


                                      6

<PAGE>
      
INDEPENDENCE HOLDING COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
---------------------------------------------------------------------------
NOTE 3. INVESTMENT SECURITIES (CONTINUED)

                                               JUNE 30, 1997                   
                           -------------------------------------------------
                                           GROSS          GROSS
                           AMORTIZED     UNREALIZED     UNREALIZED    FAIR
                             COST          GAINS         (LOSSES)    VALUE     
                           -------------------------------------------------  
                                       (DOLLARS IN THOUSANDS)               
EQUITY SECURITIES
-----------------
 AVAILABLE-FOR-SALE:
  Common stock..............$  6,653     $    229     $    (74)     $  6,808
  Options...................      79           30         -              109 
  Preferred stock...........   2,059          147         -            2,206
                             -------      -------      -------       -------
                               8,791          406          (74)        9,123
 TRADING:                    -------      -------      -------       -------
  Common stock..............   1,762          115         (115)        1,762
                             -------      -------      -------       -------
Total equity securities     $ 10,553     $    521     $   (189)     $ 10,885
                             =======      =======      =======       =======
FINANCIAL INSTRUMENTS SOLD,
BUT NOT YET PURCHASED
---------------------------
TRADING:
  Options...................$    (82)    $     39     $   -         $    (43)
                             -------      -------      -------       -------
Total financial instrument
 sold, but not yet 
 purchased..................$    (82)    $     39     $   -         $    (43)
                             =======      =======      =======       =======


                                           DECEMBER 31, 1996                   
                           ------------------------------------------------
                                           GROSS          GROSS
                           AMORTIZED     UNREALIZED     UNREALIZED    FAIR
                             COST          GAINS         (LOSSES)    VALUE     
                           ------------------------------------------------  
                                       (DOLLARS IN THOUSANDS)               
FIXED MATURITIES
----------------
 AVAILABLE-FOR-SALE:
  Corporate securities.....$ 30,204     $    377     $ (1,311)     $ 29,270
  U.S. Government and
   agencies obligations....  28,832          180         (747)       28,265
  GNMA's................... 106,701           69         (844)      105,926
  Obligations of states                                                        
   and political                                                               
   subdivisions............   1,618           44          (83)        1,579  
                            -------      -------      -------       -------
 Total fixed maturities    $167,355     $    670     $ (2,985)     $165,040  
                            =======      =======      =======       =======

                                            7

<PAGE>                                     


INDEPENDENCE HOLDING COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
----------------------------------------------------------------------------
NOTE 3. INVESTMENT SECURITIES (CONTINUED)

                                           DECEMBER 31, 1996                   
                           ------------------------------------------------
                                           GROSS          GROSS
                           AMORTIZED     UNREALIZED     UNREALIZED    FAIR
                             COST          GAINS         (LOSSES)    VALUE     
                           ------------------------------------------------  
                                       (DOLLARS IN THOUSANDS)               
EQUITY SECURITIES
-----------------
 AVAILABLE-FOR-SALE:                                                     
  Common stock.............$  2,211     $    283     $    (31)     $  2,463
  Preferred stock..........   1,440          105        -             1,545
                            -------      -------      -------       -------
                              3,651          388          (31)        4,008 
                            -------      -------      -------       -------
TRADING:
  Common stock.............     335           84        -               419
                            -------      -------      -------       -------
 Total equity securities   $  3,986     $    472     $    (31)     $  4,427  
                            =======      =======      =======       =======
FINANCIAL INSTRUMENTS SOLD,
BUT NOT YET PURCHASED         
---------------------------
 TRADING:
  Common stock............ $   (585)    $     46     $  -          $   (539)
                            -------      -------      -------       -------
 Total financial instruments
  sold, but not yet 
  purchased                $   (585)    $     46     $  -          $   (539)
                            =======      =======      =======       =======

      The amortized cost and fair value of fixed maturities at June
30, 1997, by contractual maturity, are shown below. Expected
maturities will differ from contractual maturities because
borrowers may have the right to call or prepay obligations with or
without call or prepayment penalties.               

                                              JUNE 30, 1997    
                                        ---------------------
                                        AMORTIZED        FAIR 
                                          COST          VALUE 
                                        ---------     -------  
                                        (DOLLARS IN THOUSANDS)
                                              
      Due in one year or less.........$  -           $  -      
      Due after one year through 
       five years.....................   4,772          4,828 
      Due after five years through 
       ten years......................  37,576         36,838
      Due after ten years.............  18,757         18,147
                                       -------        -------
                                        61,105         59,813

      GNMA - 15 year..................  47,805         47,666
      GNMA - 30 year..................  62,362         62,501 
                                       -------        -------
      Totals..........................$171,272       $169,980
                                       =======        =======

                                      8
<PAGE>

INDEPENDENCE HOLDING COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------
NOTE 4.  OTHER INVESTMENTS

      At June 30, 1997, the Company had an investment of $17,373,000
in a limited partnership which invests in relatively "market
neutral" strategies, such as risk arbitrage, convertible arbitrage
and distressed situations.   The condensed statement of operations
for the limited partnership is as follows:

                          THREE MONTHS ENDED      SIX MONTHS ENDED
                               JUNE 30,               JUNE 30,
                            1997       1996       1997       1996 
                          ------------------      ----------------         
                                   (DOLLARS IN THOUSANDS)        

      Revenues............$ 4,522  $ 2,253       $ 6,242  $ 3,631
      Net income..........$ 3,369  $ 1,733       $ 4,560  $ 3,104 


      IHC's share of net
       income.............$ 1,574  $   703       $ 2,031  $ 1,210

NOTE 5.  INCOME PER SHARE

      The computations of income per share were based upon the
weighted average number of common and dilutive common equivalent
shares outstanding of approximately 7,493,000 and 7,499,000 for the
three months ended June 30, 1997 and 1996, respectively, and
7,483,000 for both the six months ended June 30, 1997 and 1996.
Dilutive common equivalent shares include 61,000 and 67,000 for the
second quarters ended June 30, 1997 and 1996, respectively, and
51,000 for both the six months ended June 30, 1997 and 1996, from
the assumed exercise of options using the treasury stock method. 
Fully diluted earnings per share is not shown as the assumed
exercise of all other stock options and warrants is anti-dilutive.

NOTE 6.  INCOME TAXES

      The provision for income taxes shown in the consolidated
statements of operations was computed based on the Company's
estimate of the effective tax rates expected to be applicable for
the current year, including the expected tax impact of the
life/nonlife consolidation and discontinued operations. 

      The income tax expense for the six months ended June 30, 1997
allocated to stockholders' equity for unrealized losses on
investment securities was $99,000 representing the change in
deferred tax asset of $393,000 at June 30, 1997 from $492,000 at
December 31, 1996.

                                9
<PAGE>


INDEPENDENCE HOLDING COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
-----------------------------------------------------------------
NOTE 7.  SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION

                                               JUNE 30,    
                                          1997          1996  
                                        ----------------------
                                        (DOLLARS IN THOUSANDS)

      Cash payments for:
           Interest.....................$   -         $    413
           Income taxes.................$   458       $    539

NOTE 8.  NEW ACCOUNTING PRONOUNCEMENTS

      In February 1997, FASB issued SFAS No. 128, "Earnings per
Share" which changes the calculation of both primary and fully
diluted earnings per share.  The requirements of SFAS No. 128 are
effective for financial statements for periods ending after
December 15, 1997, and require the restatement of all prior periods
earnings per share calculations.  Earlier application is not
permitted. Under SFAS No. 128 the calculation of earnings per share
for IHC for the quarters and six months ended June 30, 1997 and
1996 will approximately equal primary earnings per share, and
earnings per share-assuming dilution will also approximately equal
primary earnings per share.

      In June 1997, FASB issued SFAS No. 130, "Reporting
Comprehensive Income" and FASB No. 131, "Disclosures about Segments
of an Enterprise and Related Information."  The requirements for
both SFAS No. 130 and No. 131 are effective for financial
statements for periods ending after December 15, 1997.  The Company
is currently evaluating the impact of SFAS No. 130 on the financial
statements.

                                 10
<PAGE>

ITEM 7.     MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
            CONDITION AND RESULTS OF OPERATIONS
            -------------------------------------------------

      Independence Holding Company, a Delaware corporation ("IHC"),
is a holding company engaged principally in the life and health
insurance business through its wholly-owned subsidiaries, Standard
Security Life Insurance Company of New York ("Standard Life"),
Madison National Life Insurance Company, Inc. ("Madison Life") and
First Standard Security Insurance Company ("First Standard") and
their subsidiaries (collectively, the "Insurance Group"). IHC and
its subsidiaries (including the Insurance Group) are collectively
referred to as the "Company."  All remaining assets, principally
parent company liquidity (cash, cash equivalents, resale
agreements, partnership investments and marketable securities), the
Company's small real estate portfolio and certain other investments
of the Company, are included in Corporate.

                         RESULTS OF OPERATIONS
                         ---------------------
THREE MONTHS ENDED JUNE  30, 1997 COMPARED TO THREE MONTHS ENDED
JUNE 30, 1996
-----------------------------------------------------------------
     The Company's operating income from continuing operations
increased $2.2 million, or 198%, to $3.3 million for the period
ended June 30, 1997 from $1.1 million for the same period in 1996.
The Company had net realized and unrealized losses of $.3 million
in 1997 and $.8 million in 1996. Included in the 1997 second
quarter was a non-recurring gain of $1.0 million resulting from the
sale of real estate carried by the Company at nominal value.
Excluding net realized and unrealized losses and the non-recurring
gain, the Company had operating income from continuing operations
of $2.6 million in 1997 as compared to $1.9 million in 1996. 
Income from continuing operations, net was $3.2 million or $.43 per
share for the quarter ended June 30, 1997 as compared to $1.5
million or $.20 per share for the quarter ended June 30, 1996.
Income tax expense increased to $.2 million in 1997 from a tax
benefit of $.3 million in 1996.  

Insurance Group
---------------
      The Insurance Group's operating income increased $.3 million,
or 19%, to $2.2 million in 1997 from $1.9 million in 1996. 
Operating income includes net realized and unrealized losses of $.3
million in 1997 compared to $.8 million in 1996.  Decisions to sell
securities are based on cash flow needs, investment opportunities
and economic and market conditions, thus creating fluctuations in
gains (losses) from year to year. Operating income excluding net
realized and unrealized losses was $2.5 million in 1997 compared to
$2.7 million in 1996. 

                               11

<PAGE>

      Premium revenues increased $3.0 million or 17% to $20.1
million in 1997 from $17.1 million in 1996; premium revenues at
Madison Life increased $.4 million while Standard Life had a $2.6
million increase in premiums.  The increase at Madison Life is
comprised of:  a $.2 million increase in the credit lines of
business primarily due to the addition of new accounts; a $.1
million increase in long-term disability premiums; and a $.3
million increase in other life and health lines of business; offset
by a $.2 million decrease in the ordinary life and individual
accident and health lines of business.  The change at Standard Life
is comprised of:  $.1 million in additional stop-loss premiums; a
$2.1 million increase in its DBL line due to acquisitions and
continued growth in this line of business; a $.2 million increase
in HMO reinsurance premiums; and a $.2 million increase in the
closed blocks of life, annuity and individual and group accident
and health lines of business.
  
      Total net investment income increased $.2 million primarily
due to an increase in assets at Madison Life related to the
acquisition of blocks of business and the increased return on
assets, partially offset by additional invstment income recorded in
the second quarter in 1996 relating to an acquisition of a block of
business effective as of January 1, 1996.  The annualized return on
investments of the Insurance Group in the second quarter of 1997
was 8.1% compared to 7.6% in the second quarter of 1996. 

      Other income decreased $2.1 million from 1996 to 1997
resulting from a coinsurance reserve adjustment due to the
surrender by a large group of policyholders in a coinsurance treaty
at Standard Life.  This decrease was offset by the credit to
reserves relating to the closed blocks of life, annuity and
individual and group accident and health lines of business
discussed below.

      Insurance benefits, claims and reserves increased $.4 million,
or 4%, reflecting a decrease of $.1 million at Madison Life and an
increase of $.5 million at Standard Life.  Madison Life's decrease
resulted from the following:  a $.7 million decrease in ordinary
life and individual accident and health claims and reserves; a $.1
million decrease in group term life reserves; offset by a $.3
million increase in interest credited to universal life and annuity
products primarily as a result of the acquisition of the pre-need
block of business and the interest sensitive whole life block of
business; a $.1 million increase in claims and reserves in other
life and health lines of business; and a $.3 million increase in
the credit line of business due to new accounts.  The change at
Standard Life is comprised of; a $1.0 million increase in stop-loss
reserves, a $.1 million increase in HMO reinsurance reserves and a
$1.7 million increase in additional DBL claims and reserves due to
increased volume.  The foregoing increases were offset by a $2.3
million decrease in claims and reserves of the closed blocks of
life, annuity and individual and group accident and health lines of

                               12

<PAGE>

business due to the surrender by the large group of policyholders
as previously mentioned.  

      Amortization of deferred acquisition costs and general and
administrative expenses for the Insurance Group increased $.9
million.  Madison Life's expenses increased $.5 million and
Standard Life's expenses increased $.4 million primarily due to
increases in commissions, premium taxes and other general expenses
related to the increase in premium volume at both insurance
companies.

Corporate
---------
      Operating income for the quarter ended June 30, 1997 increased
by $1.9 million from 1996.  Investment income increased $.3 million
from 1996 due to higher returns from certain hedged equity
investments and an increase in corporate liquidity in 1997.  Other
income increased by $1.0 million due to a gain on the sale of the
Company's remaining real estate in Florida. Interest expense
decreased $.2 million due to the repayment of all long term debt
during 1996. Selling, general and administrative expenses decreased
$.4 million due to a reduction in expenses related to the Florida
real estate, salaries and legal fees.


SIX MONTHS ENDED JUNE  30, 1997 COMPARED TO SIX MONTHS ENDED JUNE
30, 1996
-----------------------------------------------------------------
      The Company's operating income from continuing operations
increased $3.4 million, or 136%, to $5.9 million for the period
ended June 30, 1997 from $2.5 million for the same period in 1996.
The Company had net realized and unrealized losses of $.2 million
in 1997 and $.7 million in 1996. Included in the six month period
ended June 30, 1997 is a non-recurring gain of $1.0 million
resulting from the sale of real estate carried by the Company at
nominal value.  Excluding net realized and unrealized losses and
the non-recurring gain, the Company had operating income from
continuing operations of $5.1 million in 1997 as compared to $3.2
million in 1996.  Income from continuing operations, net was $5.5
million or $.73 per share for the six months ended June 30, 1997 as
compared to $2.8 million or $.38 per share for the six months ended
June 30, 1996. Income tax expense increased to $.5 million in 1997
from a tax benefit of $.3 million in 1996.  

Insurance Group
---------------
      The Insurance Group's operating income increased 27% to $5.1
million in 1997 from $4.1 million in 1996.  Operating income
includes net realized and unrealized losses of $.2 million in 1997
compared to $.7 million in 1996.  Operating income excluding net
realized and unrealized losses was $5.3 million in 1997 compared to
$4.8 million in 1996. 

                               13

<PAGE>

      Premium revenues increased $5.3 million or 16% to $38.8
million in 1997 from $33.5 million in 1996; premium revenues at
Madison Life increased $1.2 million while Standard Life showed a
$4.1 million increase in premiums.  The increase at Madison Life is
comprised of:  a $.6 million increase in the credit lines of
business primarily due to the addition of new accounts; a $.3
million increase in long-term disability premiums; a $.1 million
increase in the ordinary life and individual accident and health
lines of business; and a $.2 million increase in other life and
health lines of business.  The change at Standard Life is comprised
of:  $.4 million in additional stop-loss premiums; a $3.1 million
increase in its DBL line due to acquisitions and the continued
growth in this line of business; a $.3 million increase in the
point of service business, and a $.3 million increase in the closed
blocks of life, annuity and individual and group accident and
health lines of business.
  
      Total net investment income increased $.8 million primarily
due to an increase in assets at Madison Life related to the
acquisition of blocks of business and the increased return on
assets.  The annualized return on investments of the Insurance
Group for the six month period ended June 30, 1997 was 7.4%
compared to 7.3% for the same period of 1996.  

      Other income decreased $2.2 million from 1996 to 1997
resulting from: a decrease of $.1 million in stop-loss recoveries
at Madison Life and a decrease of $2.1 million at Standard Life due
to the surrender by a large group of policyholders in a coinsurance
treaty.  This decrease was offset by the credit to reserves
relating to the closed blocks of life, annuity and individual and
group accident and health lines of business discussed below.

      Insurance benefits, claims and reserves increased $2.5
million, or 9%, reflecting an increase of $1.1 million at Madison
Life and $1.4 million at Standard Life.  Madison Life's increase
resulted from the following:  a $.2 million increase in long-term
disability claims; a $.4 million increase in claims and reserves in
other life and health lines of business; $.1 million increase in
group term life claims; a $.7 million increase in interest credited
to universal life and annuity products primarily as a result of the
acquisition of the pre-need block of business and the interest
sensitive whole life block of business; and a $.4 million increase
in the credit line of business due to new accounts, offset by a $.7
million decrease in ordinary life and individual accident and
health claims and reserves.  The change at Standard Life is
comprised of; a $1.5 million increase in stop-loss reserves and
$2.4 million in additional DBL claims and reserves due to increased
volume.  The foregoing increases were offset by a $2.5 million
decrease in claims and reserves of the closed blocks of life,
annuity and individual and group accident and health lines of
business due to the surrender by the large group of policyholders. 

                               14

<PAGE>

      Amortization of deferred acquisition costs and general and
administrative expenses for the Insurance Group increased $.9
million.  Madison Life's expenses increased $.5 million and
Standard Life's expenses increased $.4 million primarily due to
increases in commissions, premium taxes and other general expenses
related to the increase in premium volume at both insurance
companies.

Corporate
---------
      Operating income for the six months ended June 30, 1997
increased by $2.4 million from 1996.  Investment income increased
$.3 million from 1996 due to higher corporate liquidity in 1997. 
Other income increased by $1.0 million due to the sale of the
Company's remaining real estate in Florida. Interest expense
decreased $.4 million due to the repayment of all long term debt
during 1996. Selling, general and administrative expenses decreased
$.7 million due to a reduction in expenses related to the Florida
real estate, salaries and legal fees.

                             LIQUIDITY
                             ---------
Insurance Group
---------------
     The Insurance Group normally provides cash flow from
operations, from the receipt of scheduled principal payments on its
portfolio of fixed income securities and from earnings on short-
term investments. Such cash flow is used partially to finance
liabilities for insurance policy benefits. These liabilities
represent long-term obligations which are calculated using certain
assumed interest rates. 

      The nature and quality of insurance company investments must
comply with all applicable statutes and regulations which have been
promulgated primarily for the protection of policyholders. Of the
aggregate carrying value of the Company's investment assets,
approximately 84% was invested in investment grade fixed income
securities, resale agreements, policy loans and cash and cash
equivalents at June 30, 1997. Also at such date, approximately 97.5%
of the Company's fixed maturities were investment grade. These
investments carry less risk and, therefore, lower interest rates
than other types of fixed maturity investments. At June 30, 1997,
approximately 2.5% of the carrying value of fixed maturities was
invested in diversified non-investment grade fixed income
securities (investments in such securities have different risks
than investment grade securities, including greater risk of loss
upon default, and thinner trading markets).  Less than .1% of the
Company's total investments were in mortgage loans.  The Company
currently has no non-performing fixed maturities. 

                               15

<PAGE>

      The Company monitors its investment portfolio on a continuous
basis and believes that the liquidity of the Insurance Group will
not be adversely affected by its current investments.

Corporate
---------
      Corporate derives its funds principally from (i) dividends and
interest income from the Insurance Group; (ii) tax payments
pursuant to tax sharing agreements and management fees from its
subsidiaries; and (iii) investment income from Corporate liquidity.
Regulatory constraints historically have not affected the Company's
consolidated liquidity, although state insurance laws have
provisions relating to the ability of the parent company to use
cash generated by the Insurance Group to fund operating expenses
and dividend payments at Corporate.

      During the second quarter of 1997, the Company sold its
remaining real estate in Florida for a gain of $1.0 million, and
continues to pursue the sale of its remaining portfolio of real
estate.  The sale of the remaining real estate would also have a
non-recurring positive impact on the Company's earnings; the effect
thereof on stockholders' equity would not be material.  

      Total corporate liquidity (cash, cash equivalents, resale
agreements and marketable securities) amounted to $16.6 million at
June 30, 1997. At the present time, the Company is not in need of
any additional long-term financing.

      In the second quarter of 1997, the Board of Directors of IHC
approved the continuation of its share repurchase program and
authorized the acquisition in the open market of up to 750,000
shares of IHC's common stock (approximately 10% of the
outstanding). The timing and price of any purchases will be at the
sole discretion of IHC's management, and the program may be
discontinued or suspended at any time (since the initiation of
IHC's repurchase program in 1991, approximately 1,700,000 net
shares have been acquired at a cost of $8.3 million). 

Capital Resources
-----------------
      Due to its superior capital ratios, broad licensing and
excellent asset quality and credit-worthiness, the Insurance Group
remains well positioned to increase or diversify its current
activities, and to raise additional capital in the public or
private markets to the extent determined to be necessary or
desirable, in order to pursue acquisitions or otherwise expand its
operations.

      In accordance with Statement of Financial Accounting Standards
("SFAS") No. 115, the Company may carry its portfolio of fixed
income securities either as held to maturity (carried as amortized
cost), as trading securities (carried at fair value) or as

                               16

<PAGE>

available-for-sale (carried at fair value); the Company has chosen
to carry all of its debt securities as available-for-sale. 
Primarily as a result of the decrease in interest rates, the
Company experienced a change in unrealized loss of $.9 million, net
of deferred tax benefits, in total stockholders' equity, reflecting
unrealized losses of $.6 million at June 30, 1997 versus unrealized
losses of $1.5 million at December 31, 1996.  

New Accounting Pronouncements
-----------------------------
      In June 1996, the Financial Accounting Standards Board
("FASB") issued SFAS No. 125, "Accounting for Transfers and
Servicing of Financial Assets and Extinguishments of Liabilities." 
In December 1996 the FASB issued SFAS No. 127, "Deferral of the
Effective Date of Certain Provisions of FASB Statement No. 125."
The requirements of SFAS No. 125 have been deferred by SFAS No. 127
for those types of transactions that are entered into by the
Company and would be effective after December 31, 1997, and are to
be applied prospectively.  Earlier or retroactive application is
not permitted.  The Company is currently evaluating the Statement
but does not believe it will have a material impact on the Company.

      In February 1997, FASB issued SFAS No. 128, "Earnings per
Share" which changes the calculation of both primary and fully
diluted earnings per share.  The requirements of SFAS No. 128 are
effective for financial statements for periods ending after
December 15, 1997, and require the restatement of all prior periods
earnings per share calculations.  Earlier application is not
permitted. Under SFAS No. 128, the calculation of earnings per
share for IHC for the quarters and six months ended June 30, 1997
and 1996 will approximately equal primary earnings per share, and
earnings per share-assuming dilution will approximately equal
earnings per share. 

      In June 1997, FASB issued SFAS No. 130, "Reporting
Comprehensive Income" and FASB No. 131, "Disclosures about Segments
of an Enterprise and Related Information."  The requirements for
both SFAS No. 130 and No. 131 are effective for financial
statements for periods ending after December 15, 1997.  The Company
is currently evaluating the impact of SFAS No. 130 on the financial
statements.

                                17

<PAGE>

PART II.  OTHER INFORMATION
---------------------------
Item 4.   Submission of Matters to a Vote of Security Holders
          ---------------------------------------------------
            At its Annual Meeting of Stockholders held on June 16,
1997, the following eight nominees were re-elected for one-year
terms on the Board of Directors:

            Harold E. Johnson, Allan C. Kirkman, Steven B. Lapin,
            Donald T. Netter,  Edward Netter,  Edward J. Scheider,
            Roy T.K. Thung and F. Peter Zoch, III

            The vote on the election of the above nominees was:

            For         At least 5,863,129 shares
            Withheld    No more than 10,181 shares

            There were no broker nonvotes.

            In addition, at such meeting, the appointment of KPMG
Peat Marwick LLP as independent auditors for 1997 was ratified by
a vote of 5,863,660 shares for, 2,767 shares against, and 6,883
shares abstaining.  There were no broker nonvotes.

Item 6.   Exhibits and Reports on Form 8-K
          --------------------------------
      a)    1)    Exhibit 11.  Statement re:  computation of per
                  share earnings.

            2)    Exhibit 27.  Financial Data Schedule.

      b)    No report on Form 8-K was filed during the quarter ended
            June 30, 1997.

                                  18

<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.


                                 INDEPENDENCE HOLDING COMPANY
                                 ----------------------------
                                       (THE REGISTRANT)



Dated: August 13, 1997             By: /s/Roy T.K. Thung          
                                       -------------------------
                                       Roy T. K. Thung
                                       Executive Vice President,
                                       Chief Financial Officer
                                       and Treasurer





Dated: August 13, 1997             By: /s/Teresa A. Herbert       
                                       -------------------------
                                       Teresa A. Herbert
                                       Vice President and
                                       Controller




                                19