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:  SEPTEMBER 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 former  fiscal year, if changed since
last report.


Indicate by check mark whether the registrant(1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period
that the registrant was required to file such reports),and (2)has been
subject to such filing requirements for the past 90 days. Yes X.  No .

            7,431,769 SHARES OF COMMON STOCK, $1.00 PAR VALUE
----------------------------------------------------------------------
            Common stock outstanding as of November 6, 1997

<PAGE>

INDEPENDENCE HOLDING COMPANY AND SUBSIDIARIES
                                    
                      INDEX
                                    
                                    
                                    
PART I - FINANCIAL INFORMATION                      PAGE NO.
------------------------------                      --------
 Consolidated Balance Sheets -
  September 30, 1997 (unaudited)
  and December 31, 1996...........................       2

 Consolidated Statements of Operations -
  Three Months and Nine Months Ended
  September 30, 1997 and 1996 (unaudited).........       3

 Consolidated Statements of Cash Flows -
  Nine Months Ended September 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 6 - Exhibits and Reports on Form 8-K........      18

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


                               1
<PAGE>


INDEPENDENCE HOLDING COMPANY AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS          SEPTEMBER 30,   DECEMBER 31,
        (UNAUDITED)                      1997            1996
-----------------------------------------------------------------
ASSETS:
 Cash and cash equivalents..........$  1,325,000   $ 10,361,000
  Short-term investments............   7,414,000   $ 10,316,000
  Securities purchased under
   agreements to resell.............  18,140,000     36,542,000
  Fixed maturities (Note 3)......... 183,504,000    165,040,000
  Equity securities (Note 3)........  14,391,000      4,427,000
  Other investments.................  44,755,000     32,683,000
                                     -----------    ----------- 
      Total investments............. 268,204,000    249,008,000
 Deferred insurance acquisition
  costs.............................  10,959,000     11,221,000
 Due and unpaid premiums............   7,734,000      5,122,000
 Due from reinsurers................  86,944,000     50,877,000
 Due from brokers...................     371,000      -
 Notes and other receivables........   4,152,000      4,205,000
 Other assets.......................   7,260,000      5,607,000
                                     -----------    -----------
       TOTAL ASSETS.................$386,949,000   $336,401,000
                                     ===========    ===========
LIABILITIES AND STOCKHOLDERS' EQUITY:
 LIABILITIES:
 Future policy benefits.............$146,516,000   $115,594,000
 Unearned premiums..................  23,735,000     11,654,000
 Funds on deposit...................  65,535,000     68,915,000
 Insurance policy claims............   4,717,000      3,914,000
 Other policyholders' funds.........   2,268,000      2,201,000
 Financial instruments sold, but
  not yet purchased (Note 3)........     109,000        539,000
 Due to brokers.....................  14,486,000     19,740,000
 Due to reinsurers..................   9,057,000      6,764,000
 Accounts payable, accruals and
  other liabilities.................  19,003,000     18,653,000
 Liability for business transferred.   7,905,000      7,905,000
 Income taxes.......................   5,440,000      3,666,000
                                     -----------    -----------
     TOTAL LIABILITIES.............. 298,771,000    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 gains (losses) on
  investments, net of taxes(Note 6).   1,580,000     (1,466,000)
 Retained earnings (accumulated
  deficit)..........................   3,098,000     (5,178,000)
                                     -----------    -----------
     TOTAL STOCKHOLDERS' EQUITY.....  88,178,000     76,856,000
                                     -----------    -----------
     TOTAL LIABILITIES AND
      STOCKHOLDERS' EQUITY..........$386,949,000   $336,401,000
                                     ===========    ===========

        See Accompanying Notes to Consolidated Financial Statements.

                                   2
<PAGE>

INDEPENDENCE HOLDING COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
                                THREE MONTHS               NINE MONTHS
                             ENDED SEPTEMBER 30,       ENDED SEPTEMBER 30,
                             1997          1996        1997          1996
-------------------------------------------------------------------------- 
REVENUES:
 Insurance premiums....$ 21,735,000 $ 17,084,000 $ 60,557,000 $ 50,632,000
 Net investment income.   6,046,000    3,394,000   15,763,000   12,099,000
 Net realized and
  unrealized gains
  (losses).............      52,000      208,000      (99,000)    (453,000)
 Equity income (loss)..      72,000      (36,000)     151,000       40,000
 Other income..........   1,301,000    1,050,000    2,165,000    3,114,000
                         ----------   ----------   ----------   ----------
                         29,206,000   21,700,000   78,537,000   65,432,000
                         ----------   ----------   ----------   ----------
EXPENSES:
 Insurance benefits,
  claims and reserves..  16,269,000   12,024,000   43,231,000   36,650,000
 Amortization of
  deferred insurance
  acquisition costs....     741,000      713,000    2,195,000    2,935,000
 Interest expense......       -          192,000        -          657,000
 Selling, general and
  administrative
  expenses.............   8,691,000    7,052,000   23,699,000   20,971,000
                         ----------   ----------   ----------   ----------
                         25,701,000   19,981,000   69,125,000   61,213,000
                         ----------   ----------   ----------   ----------
 Operating income
  before income taxes..   3,505,000    1,719,000    9,412,000    4,219,000
 Income tax expense
  (benefit)............     680,000     (237,000)   1,136,000     (569,000)
                         ----------   ----------   ----------   ----------
 Income from continuing
  operations...........   2,825,000    1,956,000    8,276,000    4,788,000
 Income from discon-
  tinued operations,net       -          531,000        -        1,558,000
                         ----------   ----------   ----------   ----------
 Net income............$  2,825,000 $  2,487,000 $  8,276,000 $  6,346,000
                         ==========   ==========   ==========   ==========
INCOME PER COMMON SHARE:
Income from continuing
 operations............$        .37 $        .26 $       1.10 $        .64
Income from discon-
 tinued operations,net.       -              .07        -              .21
                         ----------   ----------   ----------   ----------
Net income.............$        .37 $        .33 $       1.10 $        .85
                         ==========   ==========   ==========   ==========
WEIGHTED AVERAGE COMMON
 AND COMMON EQUIVALENT
 SHARES OUTSTANDING....   7,602,000    7,500,000    7,549,000    7,489,000
                         ==========   ==========   ==========   ==========

         See Accompanying Notes to Consolidated Financial Statements.
                                      
                                    3
<PAGE>

INDEPENDENCE HOLDING COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
NINE MONTHS ENDED SEPTEMBER 30,                   1997           1996
---------------------------------------------------------------------
CASH FLOWS FROM OPERATING ACTIVITIES:
 Net income...............................$  8,276,000   $  6,346,000
 Adjustment to reconcile net income to net
  cash provided by operating activities:
  Amortization of deferred insurance
   acquisition costs.......................  2,195,000      2,935,000
  Realized losses on investments...........     70,000        461,000
  Unrealized losses on trading securities..     30,000         (8,000)
  Equity income............................   (151,000)       (40,000)
  Depreciation.............................    308,000        225,000
  Deferred taxes...........................    437,000       (126,000)
  Income from discontinued operations, net.      -         (1,558,000)
  Other.................................... (5,312,000)    (2,192,000)
 Change in assets and liabilities:
  Net purchases of trading securities...... (2,031,000)      (261,000)
  Increase in insurance liabilities........ 42,311,000     34,347,000
  Additions to deferred insurance
   acquisition costs....................... (1,932,000)    (4,831,000)
  Change in net amounts due from and to
   reinsurers..............................(33,774,000)     2,372,000
  Change in income tax liability...........     32,000       (315,000)
  Other.................................... (3,467,000)      (237,000)
                                           -----------    -----------
      Net cash provided by operating
       activities.........................   6,992,000     37,118,000
                                           -----------    -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
 Change in net amount due from and to
  brokers.................................  (5,625,000)   (11,225,000)
 Sales and maturities of short-term
  investments.............................  35,166,000     22,245,000
 Purchases of short-term investments...... (32,254,000)   (24,195,000)
 Net purchases (sales) of resale
  agreements..............................  18,402,000     (7,527,000)
 Sales and maturities of fixed maturities. 121,589,000    120,069,000
 Purchases of fixed maturities............(137,010,000)  (150,490,000)
 Sales of equity securities...............  20,190,000     17,112,000
 Purchases of equity securities........... (27,159,000)   (15,632,000)
 Proceeds on sale of other investments....   3,081,000      3,200,000
 Other investments, net...................  (9,541,000)   (10,167,000)
 Other....................................    (677,000)     4,548,000
                                           -----------    -----------
      Net cash used by investing
       activities......................... (13,838,000)   (52,062,000)
                                           -----------    -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
 Repurchase of common stock and warrants..       -             (5,000)
 Payments of investment-type insurance
  contracts...............................  (1,818,000)    (1,818,000)
 Payments of long-term debt...............       -         (2,055,000)
 Dividends paid...........................    (372,000)      (297,000)
                                           -----------    -----------
       Net cash used by financing
        activities........................  (2,190,000)    (4,175,000)
                                           -----------    -----------

 Decrease in cash and cash equivalents....  (9,036,000)   (19,119,000)
 Cash and cash equivalents, beginning
  of year.................................  10,361,000     26,860,000
                                           -----------    -----------
 Cash and cash equivalents, end of period.$  1,325,000   $  7,741,000
                                           ===========    ===========

        See Accompanying Notes to Consolidated Financial Statements.

                                    4
<PAGE>

INDEPENDENCE HOLDING COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
________________________________________________________________
NOTE 1.  SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES

     (A)  BUSINESS AND ORGANIZATION

      Independence  Holding Company ("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".
     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 nine months ended  September
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 Sign Company, "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
during 1996.

NOTE 3. INVESTMENT SECURITIES

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

                                     SEPTEMBER 30, 1997
                         --------------------------------------
                                     GROSS      GROSS
                         AMORTIZED UNREALIZED UNREALIZED  FAIR
                           COST       GAINS    (LOSSES)   VALUE
                         --------------------------------------
                                  (DOLLARS IN THOUSANDS)

FIXED MATURITIES
----------------
 AVAILABLE-FOR-SALE:
  Corporate securities...$ 32,603  $     381  $   (299) $ 32,685
  U.S. Government and
   agencies obligations..  33,021        461      (116)   33,366
  Government National
   Mortgage Association.. 113,955      1,203       (21)  115,137
  Obligations of states
   and political
   subdivisions..........   2,353         58       (95)    2,316
                          -------    -------   -------   -------
Total fixed maturities   $181,932   $  2,103  $   (531) $183,504
                          =======    =======   =======   =======
EQUITY SECURITIES
-----------------
 AVAILABLE-FOR-SALE:
  Common stock...........$  9,211   $    686  $    (57) $  9,840
  Options................      92        -         (13)       79
  Preferred stock........   2,059        205       -       2,264
                          -------    -------   -------   -------
                           11,362        891       (70)   12,183
                          -------    -------   -------   -------
TRADING:
  Common stock...........   2,146         86       (24)    2,208
                          -------    -------   -------   -------
Total equity securities..$ 13,508   $    977  $    (94) $ 14,391
                          =======    =======   =======   =======

                                       6
<PAGE>
  
INDEPENDENCE HOLDING COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
______________________________________________________________
NOTE 3.  INVESTMENT SECURITIES (CONTINUED)

                                     SEPTEMBER 30, 1997
                         ---------------------------------------
                                      GROSS       GROSS
                         AMORTIZED  UNREALIZED  UNREALIZED FAIR
                           COST       GAINS      (LOSSES)  VALUE
                         ---------------------------------------
                                 (DOLLARS IN THOUSANDS)

FINANCIAL INSTRUMENTS SOLD,
 BUT NOT YET PURCHASED
---------------------------
 TRADING:
  Options................$   (148) $     43  $      (4) $   (109)
                          =======   =======   ========   =======

                                    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
  Government National
  Mortgage Association... 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) $165,040
                          =======    ======   ========   =======
EQUITY SECURITIES
-----------------
 AVAILABLE-FOR-SALE:
  Common stock...........$  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)
                          =======   =======   =======    =======

                                      7
<PAGE>

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

      The  amortized cost and fair value of fixed  maturities  at
September  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.

                                      SEPTEMBER 30, 1997
                                     -------------------
                                     AMORTIZED     FAIR
                                       COST        VALUE
                                     ---------     -----
                                    (DOLLARS IN THOUSANDS)

     Due in one year or less.........$    -      $    -
     Due after one year through
      five years.....................   4,763       4,878
     Due after five years through
      ten years......................  35,583      35,908
     Due after ten years.............  27,631      27,581
                                      -------     -------
                                       67,977      68,367

     GNMA - 15 year..................  45,017      45,397
     GNMA - 30 year..................  68,938      69,740
                                      -------     -------
     Totals..........................$181,932    $183,504
                                      =======     =======
NOTE 4.  OTHER INVESTMENTS

      At  September  30, 1997, the Company had an  investment  of
$18,449,000 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     NINE MONTHS ENDED
                     SEPTEMBER 30,         SEPTEMBER 30,
                  1997          1996     1997         1996
                  ------------------     -----------------
                           (DOLLARS IN THOUSANDS)

Revenues..........$ 2,949    $ 1,119     $ 9,191   $ 4,889
Net income........$ 2,213    $   793       6,774   $ 3,896

IHC's share of
 net income.......$ 1,076    $   230     $ 3,107   $ 1,440

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  7,602,000 and  7,500,000  for  the  three

           
                                    8
<PAGE>

INDEPENDENCE HOLDING COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
______________________________________________________________
NOTE 5.  INCOME PER SHARE (CONTINUED)

months  ended  September  30, 1997 and  1996,  respectively,  and
7,549,000  and 7,489,000 for the nine months ended September  30,
1997 and 1996.  Dilutive common equivalent shares include 170,000
and  68,000  for the three months ended September  30,  1997  and
1996,  respectively, and 117,000 and 57,000 for the  nine  months
ended  September 30, 1997 and 1996 respectively, 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 nine months ended September
30,  1997 allocated to stockholders' equity for unrealized  gains
on  investment securities was $1,306,000 representing the  change
in deferred tax expense of $814,000 at September 30, 1997 from  a
deferred tax benefit of $492,000 at December 31, 1996.

NOTE 7.  SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION

                                     NINE MONTHS ENDED
                                       SEPTEMBER 30,
                                  1997              1996
                                  ----------------------
                                  (DOLLARS IN THOUSANDS)

     Cash payments for:
           Interest...............$   -          $   643
           Income taxes...........$   676        $   877

NOTE 8.  NEW ACCOUNTING PRONOUNCEMENTS

     In February 1997, FASB issued SFAS 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  IHC'S
earnings  per share and earnings per share-assuming dilution  for
each  of  the three and nine months ended September 30, 1997  and
1996  will not be materially different than primary earnings  per
share.

 
                                 9
<PAGE>

INDEPENDENCE HOLDING COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
___________________________________________________________
NOTE 8.  NEW ACCOUNTING PRONOUNCEMENTS (CONTINUED)

       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
and No. 131 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 SEPTEMBER 30, 1997 COMPARED TO THREE MONTHS
ENDED SEPTEMBER 30, 1996
-----------------------------------------------------------------
      The  Company's operating income from continuing  operations
increased  $1.8 million, or 104%, to $3.5 million for the  period
ended September 30, 1997 from $1.7 million for the same period in
1996.   The Company had net realized and unrealized gains of  $.1
million  in 1997 and $.2 million in 1996. Excluding net  realized
and  unrealized  gains,  the Company had  operating  income  from
continuing operations of $3.4 million in 1997 as compared to $1.5
million in 1996.  Income from continuing operations, net was $2.8
million,  or $.37 per share, for the quarter ended September  30,
1997 compared to $2.0 million, or $.26 per share, for the quarter
ended  September 30, 1996.  Income tax expense increased  to  $.7
million  in 1997 from a tax benefit of $.2 million in  1996  (see
Capital Resources).

Insurance Group
---------------
      The  Insurance  Group's  operating  income  increased  $1.1
million,  or  44%, to $3.6 million in 1997 from $2.5  million  in
1996. Operating income includes net realized and unrealized gains
of  $.1  million  in  1997  compared  to  $.2  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 gains  was
$3.5 million in 1997 compared to $2.3 million in 1996.

      Premium  revenues increased $4.6 million, or 27%, to  $21.7
million  in 1997 from $17.1 million in 1996; premium revenues  at
Madison  Life increased $3.3 million while Standard  Life  had  a
$1.3  million increase in premiums.  The increase at Madison Life


                                  11
<PAGE>


is  comprised of:  a $2.9 million increase in the credit lines of
business  primarily due to the acquisition of a block of business
in  the  third quarter of 1997, effective April 1,  1997;  a  $.2
million  increase  in long-term disability premiums;  and  a  $.3
million  increase  in other life and health  lines  of  business,
offset  by  a  $.1  million decrease in  the  ordinary  life  and
individual accident and health lines of business.  The change  at
Standard Life is comprised of: a $1.3 million increase in its DBL
line  due  to acquisitions and continued growth in this  line  of
business;  and  a  $.3 million increase in the closed  blocks  of
life,  annuity and individual and group accident and health lines
of  business,  offset  by  a $.3 million  decrease  in  stop-loss
premiums, due to decreased retention of several managing  general
underwriters.

     Total net investment income increased $2.2 million primarily
due  to  an  increase in assets at Madison Life  related  to  the
acquisition of blocks of business, an increased return on  assets
and  the  retention of assets at Standard Life which were subject
to  a  right of recapture in the third quarter of 1996, but which
assets were subsequently not recaptured. The annualized return on
investments of the Insurance Group in the third quarter  of  1997
was 7.9% compared to 7.0% in the third quarter of 1996.

      Other  income increased $.2 million and equity income  from
partnerships increased $.1 million from 1996 to 1997.

      Insurance  benefits,  claims and  reserves  increased  $4.1
million,  or  34%,  reflecting an increase  of  $2.3  million  at
Madison  Life and $1.8 million at Standard Life.  Madison  Life's
increase  resulted from: a $1.6 million increase  in  the  credit
line  of  business due to the acquisition of a block of  business
and  due  to  new  accounts; a $.2 million increase  in  interest
credited  to  universal  life and annuity  products;  and  a  $.5
million increase in claims and reserves in other life and  health
lines  of business. The change at Standard Life is comprised  of:
a  $.8  million  increase in stop-loss reserves,  a  $.1  million
increase  in HMO reinsurance reserves; a $.8 million increase  in
additional DBL claims and reserves due to increased volume; and a
$.1 million increase in point of service claims.

      Amortization of deferred acquisition costs and general  and
administrative  expenses for the Insurance Group  increased  $1.8
million.  Madison  Life's  expenses increased  $1.6  million  and
Standard Life's expenses increased $.2 million primarily  due  to
increases  in commissions of $1.2 million, premium taxes  of  $.1
million and other general expenses of $.5 million related to  the
increase  in premium volume at both insurance companies  and  the
acquisition of new blocks of business at Madison Life.

Corporate
---------
      Operating income for the quarter ended September  30,  1997
increased  by $.7 million from 1996.  Investment income increased


                               12
<PAGE>


$.4  million from 1996 due to higher returns from certain  hedged
equity  investments  and  an increase in corporate  liquidity  in
1997.   Interest expense decreased $.2 million due to the payment
of   all  long  term  debt  during  1996.  Selling,  general  and
administrative expenses decreased $.1 million.

NINE  MONTHS  ENDED SEPTEMBER 30, 1997 COMPARED  TO  NINE  MONTHS
ENDED SEPTEMBER 30, 1996
-----------------------------------------------------------------
      The  Company's operating income from continuing  operations
increased  $5.2 million, or 123%, to $9.4 million for the  period
ended September 30, 1997 from $4.2 million for the same period in
1996.  The Company had net realized and unrealized losses of  $.1
million  in  1997 and $.5 million in 1996. Included in  the  nine
month period ended September 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 $8.5  million  in
1997 as compared to $4.7 million in 1996.  Income from continuing
operations,  net was $8.3 million, or $1.10 per  share,  for  the
nine months ended September 30, 1997 compared to $4.8 million, or
$.64  per  share, for the nine months ended September  30,  1996.
Income tax expense increased to $1.1 million in 1997 from  a  tax
benefit of $.6 million in 1996 (see Capital Resources).

Insurance Group
---------------
     The Insurance Group's operating income increased 33% to $8.8
million  in  1997  from $6.6 million in 1996.   Operating  income
includes  net  realized and unrealized losses of $.1  million  in
1997 compared to $.5 million in 1996.  Operating income excluding
net  realized  and  unrealized losses was $8.9  million  in  1997
compared to $7.1 million in 1996.

      Premium  revenues increased $9.9 million, or 20%, to  $60.5
million  in 1997 from $50.6 million in 1996; premium revenues  at
Madison Life increased $4.5 million while Standard Life showed  a
$5.4  million increase in premiums.  The increase at Madison Life
is  comprised of:  a $3.6 million increase in the credit lines of
business  primarily due to the acquisition of a block of business
in  the  third quarter of 1997, effective April 1,  1997;  a  $.4
million  increase  in long-term disability premiums;  and  a  $.6
million increase in the dental line of business, offset by a  net
$.1  million decrease in other life and health lines of business.
The  increase  at Standard Life is comprised of: a  $4.4  million
increase  in  its DBL line due to acquisitions and the  continued
growth  in this line of business; a $.2 million increase  in  the
point  of service business; a $.4 million increase in the  closed
blocks  of  life, annuity and individual and group  accident  and
health  lines  of business; and a $.4 million increase  in  other
life and health lines of business.


                               13
<PAGE>

     Total net investment income increased $3.0 million primarily
due  to  an  increase in assets at Madison Life  related  to  the
acquisition of blocks of business, an increased return on  assets
and  the  retention of assets at Standard Life which were subject
to  a  right of recapture in the third quarter of 1996, but which
assets  were subsequently not recaptured.  The annualized  return
on  investments of the Insurance Group for the nine months period
ended  September 30, 1997 was 7.6% compared to 7.5% for the  same
period  of  1996.  Equity  income  from  partnership  investments
increased $.1 million.

      Other  income  decreased $2.0 million  from  1996  to  1997
resulting from the surrender by a large group of policyholders in
a  coinsurance treaty at Standard Life, 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  $6.5
million,  or  18%,  reflecting an increase  of  $3.4  million  at
Madison  Life and $3.1 million at Standard Life.  Madison  Life's
increase  resulted  from:  a $.3 million  increase  in  long-term
disability claims; a $.6 million increase in claims and  reserves
in  other  life  and  health lines of  business;  a  $.6  million
increase in dental claims due to the increase in premium  volume;
a $.9 million increase in interest credited to universal life and
annuity products; and a $2.0 million increase in the credit  line
of  business  due to the acquisition of the block of business  in
the  third  quarter  of  1997 and the addition  of  new  accounts
throughout the current year, offset by a $1.0 million decrease in
ordinary  life  and  individual accident and  health  claims  and
reserves.   The change at Standard Life is comprised of:  a  $2.1
million  increase in stop-loss reserves; a $2.9 million  increase
in  DBL  claims and reserves due to increased volume; and  a  $.3
million   net  increase  in  claims  and  reserves  in  the   HMO
reinsurance  line of business, offset by a $2.2 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.

      Amortization of deferred acquisition costs and general  and
administrative  expenses for the Insurance Group  increased  $2.7
million.   Madison  Life's expenses increased  $2.2  million  and
Standard Life's expenses increased $.5 million primarily  due  to
increases  in commissions of $1.6 million, premium taxes  of  $.2
million and other general expenses of $.9 million related to  the
increase  in premium volume at both insurance companies  and  the
acquisition of new blocks of business at Madison Life.


                              14
<PAGE>

Corporate
---------
      Operating  income for the nine months ended  September  30,
1997  increased  by  $3.0  million from 1996.  Investment  income
increased $.6 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 $.6 million due to the repayment of  all  long
term  debt  during  1996.  Selling,  general  and  administrative
expenses  decreased  $.8 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 81% was invested in investment grade  fixed
income  securities, resale agreements, policy loans and cash  and
cash  equivalents  at September 30, 1997.   Also  at  such  date,
approximately  97.7%  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 September 30, 1997, approximately  2.3%
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.    Any
remaining real estate is carried on the balance sheet at  nominal
value.  The Company has no non-performing fixed maturities.

       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.

      The  Company has net receivables from reinsurers  of  $77.9
million at September 30, 1997.  Substantially all of the business
ceded  to  such  reinsurers is of short  duration.  All  of  such
receivables  are  current and are either due  from  highly  rated
companies  authorized to do business in the state of domicile  of
the  individual insurance companies, or are secured by  either  a


                               15
<PAGE>

letter  of  credit or custodial trust agreement. Accordingly,  no
allowance  for  doubtful accounts was necessary at September  30,
1997.

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 small real estate portfolio.
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 $17.9  million
at  September 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  available-for-sale (carried at fair value); the  Company  has
chosen to carry all of its debt securities as available-for-sale.


                               16
<PAGE>


Primarily  as  a  result of the decrease in interest  rates,  the
Company experienced a change in unrealized gains of $3.1 million,
net  of  deferred  tax  expense, in total  stockholders'  equity,
reflecting unrealized gains of $1.6 million at September 30, 1997
versus unrealized losses of $1.5 million at December 31, 1996.

      The  Company  has historically had relatively  low  federal
income   tax  expense  due  to  the  utilization  of   tax   loss
carryforwards; it is anticipated that, all of the  remaining  tax
benefits   associated   with  the   utilization   of   tax   loss
carryforwards  will be recognized during the  fourth  quarter  of
1997,  except for remaining tax benefits associated with acquired
tax loss carryforwards which are limited as to their utilization.

       Some   of  the  statements  included  within  Management's
Discussion  and Analysis may be considered to be forward  looking
statements  which are subject to certain risks and uncertainties.
Factors which could cause the actual results to differ materially
from  those suggested by such statements are described from  time
to  time  in the Company's Annual report on Form 10-K  and  other
filings with the Securities and Exchange Commission.

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,  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 and earnings per share-assuming dilution for  IHC  for
each  of  the three and nine months ended September 30, 1997  and
1996  will not be materially different than primary earnings  per
share.

       In  June  1997,  FASB  issued  SFAS  No.  130,  "Reporting
Comprehensive  Income,"  and  FASB  No.  131,  "Disclosure  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
and No. 131 on the financial statements.


                                17
<PAGE>

PART II.  OTHER INFORMATION
---------------------------
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 September 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:  November 12, 1997      By:/s/Roy T.K. Thung
                                  -------------------------
                                  Roy T.K. Thung
                                  Executive Vice President,
                                  Chief Financial Officer
                                  and Treasurer


Dated:  November 12, 1997      By:/s/Teresa A. Herbert
                                  -------------------------
                                  Teresa A. Herbert
                                  Vice President and
                                  Controller



                               19
<PAGE>