SECURITIES AND EXCHANGE COMMISSION
                          Washington, D.C. 20549


                                 FORM 10-Q

[X]  QUARTERLY  REPORT PURSUANT TO SECTION 13 OR 15(d)  OF  THE  SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended             June 30, 1999

                                    or

[   ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE  SECURITIES
EXCHANGE ACT OF 1934
For the transition period from  ____________________ to ___________________

               Commission file numbers  33-3630 and 333-1783

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

    Rhode Island                                              05-0302931
(State of other jurisdiction of incorporation or organization)  (I.R.S.
Employer Identification No.)

 125 High Street, Boston, Massachusetts                    02110-2712
  (Address of principal executive offices)                  (Zip Code)

                              (617) 526-1400
           (Registrant's telephone number, including area code)


(Former name, former address and former fiscal year, if changed since last
report)

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

   There were 2,412,000 shares of the registrant's Common Stock, $1.25  par
value, outstanding as of June 30, 1999.


Exhibit Index - Page 16                                      Page 1 of 16


                      KEYPORT LIFE INSURANCE COMPANY
     QUARTERLY REPORT ON FORM 10-Q FOR THE PERIOD ENDED JUNE 30, 1999


                             TABLE OF CONTENTS


Part I.   FINANCIAL INFORMATION                                   Page

Item 1.   Financial Statements

          Consolidated Balance Sheet as of June 30, 1999
            and December 31, 1998                                 3

          Consolidated Income Statement for the Three and
            Six-month Periods Ended June 30, 1999 and 1998        4

          Consolidated Statement of Cash Flows for the
            Six-month Periods Ended June 30, 1999 and 1998        5

          Notes to Consolidated Financial Statements              6-7

Item 2.   Management's Discussion and Analysis of Results of
            Operations and Financial Condition                    8-13

Part II.  OTHER INFORMATION

Item 6.   Exhibits and Reports on Form 8-K                        13

Signatures                                                        14

Exhibit Index                                                     15

                                     2

                      KEYPORT LIFE INSURANCE COMPANY
                        CONSOLIDATED BALANCE SHEET
                              (in thousands)

                                                June 30,      December 31,
            ASSETS                                1999            1998
                                               Unaudited
Cash and investments:
  Bonds - available for sale
   (amortized cost: 1999 - $11,393,615;
   1998 - $11,174,697)                         $ 11,268,878   $ 11,277,204
  Equity securities (cost: 1999 -
   $17,808; 1998 - $21,836)                          23,041         24,649
  Mortgage loans                                     13,392         55,117
  Policy loans                                      587,088        578,770
  Other invested assets                             820,673        662,513
  Cash and cash equivalents                         831,350        719,625
    Total cash and investments                   13,544,422     13,317,878

Accrued investment income                           177,651        160,950
Deferred policy acquisition costs                   478,970        340,957
Value of insurance in force                          84,478         66,636
Intangible assets                                    17,454         18,082
Income taxes recoverable                             27,238         31,909
Receivable for investments sold                      34,652         37,936
Other assets                                         41,553         35,345
Separate account assets                           2,662,733      1,765,538

    Total assets                               $ 17,069,151   $ 15,775,231

LIABILITIES AND STOCKHOLDER'S EQUITY

Liabilities:

  Policy liabilities                           $ 12,354,556   $ 12,504,081
  Deferred income taxes                             141,634        143,596
  Payable for investments purchased and loaned      807,896        240,440
  Other liabilities                                  35,384         28,312
  Separate account liabilities                    2,604,280      1,723,205
    Total liabilities                            15,943,750     14,639,634

Stockholder's equity:
  Common stock, $1.25 par value;
   authorized 8,000 shares; issued
   and outstanding 2,412 shares                       3,015          3,015
  Additional paid-in capital                        505,933        505,933
  Retained earnings                                 637,187        600,396
  Accumulated other comprehensive (loss) income     (20,734)        26,253
    Total stockholder's equity                    1,125,401      1,135,597

 Total liabilities and stockholder's equity    $ 17,069,151   $ 15,775,231
                          See accompanying notes
                                     3

                      KEYPORT LIFE INSURANCE COMPANY

                       CONSOLIDATED INCOME STATEMENT
                              (in thousands)
                                 Unaudited

                                Three-months Ended      Six-months Ended
                                     June 30,               June 30,
                                1999         1998       1999        1998

Investment income            $ 195,730   $ 200,955   $ 400,655   $ 407,030
Interest credited to
   policyholders               129,409     140,198     264,187     282,334
Investment spread               66,321      60,757     136,468     124,696
Net realized investment
   losses                      (11,357)     (2,483)    (14,451)     (1,665)
Fee income:
  Surrender charges              4,442       5,409       8,327       9,620
  Separate account fees          7,708       5,394      14,286      10,102
  Management fees                2,523       1,597       4,144       2,555
Total fee income                14,673      12,400      26,757      22,277

Expenses:
  Policy benefits                  762         560       1,944       1,020
  Operating expenses            14,244      13,611      27,723      29,150
  Amortization of deferred
   policy acquisition costs     20,046      18,346      42,060      37,321
  Amortization of value of
   insurance in force            2,384       1,216       4,633       2,692
  Amortization of
   intangible assets               314         314         628         628
Total expenses                  37,750      34,047      76,988      70,811

Income before income taxes      31,887      36,627      71,786      74,497
Income tax expense              11,101      12,535      24,995      24,356

     Net income              $  20,786   $  24,092   $  46,791   $  50,141

                          See accompanying notes
                                     4
                      KEYPORT LIFE INSURANCE COMPANY

                   CONSOLIDATED STATEMENT OF CASH FLOWS
                              (in thousands)
                                 Unaudited

                                                   Six-months Ended
                                                        June 30,
                                                 1999            1998
Cash flows from operating activities:
 Net income                                  $    46,791    $    50,141
 Adjustments to reconcile net income to
  net cash provided by operating activities:
    Interest credited to policyholders           264,187        282,334
    Net realized investment losses                14,451          1,665
    Amortization of value of insurance in
      force and intangible assets                  5,261          3,320
    Net amortization on investments               39,342         28,245
    Change in deferred policy acquisition
      costs                                      (10,943)       (20,933)
    Change in current and deferred
      income taxes                                33,907         30,246
    Net change in other assets and
      liabilities                                (11,800)       (13,508)
        Net cash provided by operating
          activities                             381,196        361,510

Cash flows from investing activities:
  Investments purchased - available for
    sale                                      (2,928,649)    (3,498,283)
  Investments sold - available for sale        2,529,251      2,690,757
  Investments matured - available for sale       159,209        561,207
  Increase in policy loans                        (8,318)       (19,344)
  Decrease in mortgage loans                      41,725          2,939
  Other invested assets purchased, net           (18,666)        32,134
  Value of business acquired, net of cash                       (3,999)
    Net cash used in investing activities       (225,448)      (234,589)

Cash flows from financing activities:
  Withdrawals from policyholder accounts        (962,351)      (850,835)
  Deposits to policyholder accounts              358,018        775,231
  Dividends                                      (10,000)
  Securities lending                             570,310         16,953
    Net cash used in financing activities        (44,023)       (58,651)

Change in cash and cash equivalents              111,725         68,270
Cash and cash equivalents at beginning
  of period                                      719,625      1,162,347
Cash and cash equivalents at end of
  period                                     $   831,350    $ 1,230,617

                          See accompanying notes
                                     5

                      KEYPORT LIFE INSURANCE COMPANY

                NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                 Unaudited

1.   General

The  accompanying  unaudited consolidated financial statements  of  Keyport
Life  Insurance Company (the Company) includes all adjustments,  consisting
of normal recurring accruals that management considers necessary for a fair
presentation  of the Company's financial position as of June 30,  1999  and
December  31,  1998 and the related consolidated statements of  income  and
cash  flows  for the three and six-month periods ended June  30,  1999  and
1998.   Certain  footnote  disclosures  normally  included   in   financial
statements  prepared  in  accordance  with  generally  accepted  accounting
principles  have  been  condensed or omitted  pursuant  to  the  rules  and
regulations  of  the Securities and Exchange Commission.  Therefore,  these
consolidated  financial statements should be read in conjunction  with  the
audited  consolidated financial statements contained in the Company's  1998
Form  10-K.  The results of operations for the six-month period ended  June
30,  1999 are not necessarily indicative of the results to be expected  for
the full year.

2.   Bonds

The  Company's  general investment policy is to hold  bonds  for  long-term
investment.   To  provide  for  maximum portfolio  flexibility  and  enable
appropriate  tax planning, the Company classifies bonds as  "available  for
sale", which are carried at fair value.

The carrying value of non-income producing bonds at June 30, 1999 and
December 31, 1998 was approximately $18.2 million and $30.0 million,
respectively.

3.   Acquisitions

On  January  2,  1998, the Company acquired the common  stock  of  American
Benefit  Life  Insurance  Company, renamed Keyport Benefit  Life  Insurance
Company  on March 31, 1998, a New York insurance company, for $7.4 million.
The acquisition was accounted for as a purchase and, accordingly, operating
results are included in the consolidated financial statements from the date
of  acquisition.  In connection with the acquisition, the Company  acquired
assets  with a fair value of $9.4 million and assumed liabilities  of  $3.2
million.  Subsequent  to  the  acquisition,  the  Company  made  a  capital
contribution to Keyport Benefit in the amount of $7.5 million.

4.   Comprehensive Income

Total  comprehensive income (loss), net of tax, for the  six-month  periods
ended  June  30,  1999  and  1998, was $(0.2) million  and  $52.7  million,
respectively.

                                     6

                      KEYPORT LIFE INSURANCE COMPANY

          NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
                                 Unaudited

5.   Recent Accounting Prouncement

In  June  1998, Statement of Financial Accounting Standards (SFAS) No.  133
"Accounting for Derivative Instruments and Hedging Activities" was  issued.
SFAS  133  standardizes the accounting for derivative instruments  and  the
derivative   portion  of  certain  other  contracts   that   have   similar
characteristics by requiring that an entity recognize those instruments  at
fair  value.   This statement also requires a new method of accounting  for
hedging  transactions, prescribes the type of items and  transactions  that
may  be  hedged, and specifies detailed criteria to be met to  qualify  for
hedge  accounting.  In June 1999, SFAS No. 137 "Accounting  for  Derivative
Instruments and Hedging Activities - Deferral of the Effective Date of FASB
Statement  No. 133" was issued.  SFAS 137 defers for one year the effective
date  of SFAS 133.  The rule now will apply to all fiscal quarters  of  all
fiscal years beginning after June 15, 2000.  Earlier adoption is permitted.
Upon  adoption, the Company will be required to record a cumulative  effect
adjustment  to  reflect  this  accounting  change.   The  Company  has  not
completed its analysis and evaluation of the requirements and the impact of
this statement.
















                                     7


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

Results of Operations

Net  income was $20.8 million and $24.1 million for the three-month periods
ended  June 30, 1999 and 1998, respectively.  Net income was $46.8  million
and  $50.1 million for the six-month periods ended June 30, 1999 and  1998,
respectively.  The primary reason for the decrease in 1999 compared to  the
prior  year  is  attributable to the increase in  net  realized  investment
losses.  Income before income taxes and net realized investment losses  was
$86.2  million and $76.1 million for the six-month periods ended  June  30,
1999 and 1998, respectively.

Investment  spread is the amount by which investment income earned  on  the
Company's  investments exceeds interest credited on policyholder  balances.
Investment  spread was $66.3 million and $60.8 million for the  three-month
periods  ended June 30, 1999 and 1998, respectively.  The amount  by  which
the average yield on investments exceeds the average interest credited rate
on  policyholder  balances  is  the  investment  spread  percentage,  which
amounted to 1.86% and 1.71% for the three-month periods ended June 30, 1999
and  1998,  respectively.  Investment spread was $136.5 million and  $124.7
million   for  the  six-month  periods  ended  June  30,  1999  and   1998,
respectively.  The investment spread percentage was 1.90% and 1.78% for the
six-month periods ended June 30, 1999 and 1998, respectively.

Investment income was $195.7 million and $201.0 million for the three-month
periods  ended June 30, 1999 and 1998, respectively. The decrease  of  $5.3
million in 1999 compared to 1998 is attributable to a $8.1 million decrease
resulting  from a lower average investment yield offset by a  $2.8  million
increase  as  a  result  of  a  higher level of  average  invested  assets.
Investment income for the three-month periods ended June 30, 1999 and 1998,
includes  $19.4 million and $17.9 million, respectively, of S&P  500  Index
call  option  amortization expense related to the Company's  equity-indexed
annuities.  The average investment yield was 6.04% and 6.30% for the three-
month periods ended June 30, 1999 and 1998, respectively. Investment income
was  $400.7 million and $407.0 million for the six-month periods ended June
30,  1999  and  1998, respectively. The decrease of $6.3  million  in  1999
compared to 1998 is attributable to a $16.8 million decrease resulting from
a  lower average investment yield offset by a $10.5 million increase  as  a
result of a higher level of average invested assets. Investment income  for
the  six-month periods ended June 30, 1999 and 1998, includes $38.8 million
and  $35.2 million, respectively, of S&P 500 Index call option amortization
expense  related  to  the Company's equity-indexed annuities.  The  average
investment yield was 6.15% and 6.44 % for the six-month periods ended  June
30, 1999 and 1998, respectively.

Interest  credited to policyholders was $129.4 million and  $140.2  million
for the three-month periods ended June 30, 1999 and 1998, respectively. The
decrease  of  $10.8 million in 1999 compared to 1998 is attributable  to  a
$12.7  million  decrease resulting from a lower average  interest  credited
rate  offset  by a $1.9 million increase as a result of a higher  level  of
average policyholder balances. Policyholder balances averaged $12.4 billion
($10.2  billion  of fixed products, consisting of fixed annuities  and  the
closed  block of single premium whole life insurance, and $2.2  billion  of
equity-indexed  annuities)  and  $12.2  billion  ($10.4  billion  of  fixed
products  and $1.8 billion of equity-indexed annuities) for the three-month
periods  ended  June 30, 1999 and 1998, respectively. The average  interest
credited  rate  was  4.18% (4.98% on fixed products and  0.85%  on  equity-
indexed  annuities) and 4.59% (5.28% on fixed products and 0.85% on equity-
indexed  annuities) for the three-month periods ended  June  30,  1999  and
1998,  respectively. Interest credited to policyholders was $264.2  million
and  $282.3 million for the six-month periods ended June 30, 1999 and 1998,
respectively.  The decrease of $18.1 million in 1999 compared  to  1998  is
attributable  to  a $23.8 million decrease resulting from a  lower  average
interest credited rate offset by a $5.7 million increase as a result  of  a
higher  level  of  average  policyholder  balances.  Policyholder  balances
averaged  $12.4  billion  ($10.3 billion of fixed products,  consisting  of
fixed  annuities  and  the  closed  block  of  single  premium  whole  life
insurance, and $2.1 billion of equity-indexed annuities) and $12.1  billion
($10.4  billion  of  fixed  products and  $1.7  billion  of  equity-indexed
annuities)  for  the  six-month  periods ended  June  30,  1999  and  1998,
respectively. The average interest credited rate was 4.25% (5.00% on  fixed
products  and 0.85% on equity-indexed annuities) and 4.64% (5.29% on  fixed
products  and 0.85% on equity-indexed annuities) for the six-month  periods
ended  June  30, 1999 and 1998, respectively.  The Company's equity-indexed
annuities  credit  interest to the policyholder at a  "participation  rate"
equal  to a portion (ranging for existing policies from 30% to 95%) of  the
change  in  value  of  the  S&P  500 Index.  The  Company's  equity-indexed
annuities  also provide full guarantee of principal if held to  term,  plus
interest  at  0.85%  annually.   For each of  the  periods  presented,  the
interest   credited  to  equity-indexed  policyholders   related   to   the
participation  rate is reflected net of income recognized on  the  S&P  500
Index call options and futures resulting in a 0.85% net credited rate.

Average  investments  in  the Company's general account  (computed  without
giving  effect to SFAS 115), including a portion of the Company's cash  and
cash  equivalents, were $13.0 billion and $12.7 billion for the three-month
periods  ended  June 30, 1999 and 1998, respectively.  Average  investments
were  $13.0 billion and $12.7 billion for the six-month periods ended  June
30,  1999 and 1998, respectively.  The increases in 1999 compared  to  1998
primarily relate to reinvestment of portfolio earnings.

Net  realized  investment gains (losses) were $(11.4)  million  and  $(2.5)
million  for  the  three-month  periods  ended  June  30,  1999  and  1998,
respectively.  Net realized investment gains (losses) were $(14.5)  million
and  $(1.7) million for the six-month periods ended June 30, 1999 and 1998,
respectively.   Sales of investments generally are made to  maximize  total
return and to take advantage of prevailing market conditions. An other than
temporary decline of $3 million was recorded in the second quarter of 1999.
There  were  not any other than temporary declines recorded in  the  three-
month  period ended March 31, 1999 or the three and six-month periods ended
June 30, 1998.

Surrender  charges  are revenues earned on the early withdrawal  of  fixed,
equity-indexed  and  variable  annuity  policyholder  balances.   Surrender
charges on fixed, equity-indexed and variable annuity withdrawals generally
are  assessed at declining rates applied to policyholder withdrawals during
the first five to seven years of the contract. Total surrender charges were
$4.4  million and $5.4 million for the three-month periods ended  June  30,
1999 and 1998, respectively.  Total surrender charges were $8.3 million and
$9.6  million  for  the six-month periods ended June  30,  1999  and  1998,
respectively.

On  an  annualized basis, total fixed, equity-indexed and variable  annuity
withdrawals  represented  15.1% and 14.6%  of  the  total  average  annuity
policyholder  and  separate account balances for  the  three-month  periods
ended  June  30, 1999 and 1998, respectively, and 14.0% and  14.4%  of  the
total  average annuity policyholder and separate account balances  for  the
six-month periods ended June 30, 1999 and 1998, respectively.

Separate account fees are primarily mortality and expense charges earned on
variable annuity and variable life policyholder balances. These fees, which
are  primarily  based  on the market values of the  assets  supporting  the
contracts in separate accounts, were $7.7 million and $5.4 million for  the
three-month periods ended June 30, 1999 and 1998, respectively.  Such  fees
represented  1.26% and 1.51% of the average variable annuity  and  variable
life  separate account balances for the three-month periods ended June  30,
1999  and 1998, respectively. Separate account fees were $14.3 million  and
$10.1  million  for  the six-month periods ended June 30,  1999  and  1998,
respectively.   These  fees  represented 1.27% and  1.47%  of  the  average
variable  annuity and variable life separate account balances for the  six-
month periods ended June 30, 1999 and 1998, respectively.

Management  fees  are  primarily investment advisory fees  related  to  the
separate  account assets. The fees are based on the level of  assets  under
management,  which are affected by product sales, redemptions, and  changes
in  the market values of the investments managed. Management fees were $2.5
million  and $1.6 million for the three-month periods ended June  30,  1999
and 1998, respectively.  Management fees were $4.1 million and $2.6 million
for  the six-month periods ended June 30, 1999 and 1998, respectively.  The
increase  in  1999 compared to 1998 primarily reflects an increase  in  the
average level of assets under management.

Operating   expenses   represent  compensation  and   other   general   and
administrative  expenses.  These expenses  were  $14.2  million  and  $13.6
million  for  the  three-month  periods  ended  June  30,  1999  and  1998,
respectively.  Operating expenses were $27.7 million and $29.2 million  for
the  six-month  periods  ended June 30, 1999 and  1998,  respectively.  The
decrease  in the six-month period ended June 30, 1999 compared to the  same
period  in  the  prior  year was primarily due to  lower  compensation  and
selling expenses.

Amortization of deferred policy acquisition costs relates to the  costs  of
acquiring new business, which vary with, and are primarily related to,  the
production of new annuity business.  Such costs include commissions,  costs
of policy issuance and underwriting and selling expenses.  Amortization was
$20.0 million and $18.3 million for the three-month periods ended June  30,
1999  and  1998, respectively.  Amortization of deferred policy acquisition
costs  was $42.1 million and $37.3 million for the six-month periods  ended
June  30, 1999 and 1998, respectively.  The amortization increases in  1999
compared to 1998 are primarily related to the growth of business in  force.
Deferred  policy  acquisition cost amortization expense for  the  six-month
periods  ended June 30, 1999 and 1998 represented 27.9% and  27.7%,  on  an
annualized basis, of investment spread and separate account fees  for  1999
and 1998, respectively.

Amortization  of  value of insurance in force relates  to  the  actuarially
determined present value of projected future gross profits from policies in
force  at the date of acquisition.  Amortization was $2.4 million and  $1.2
million  for  the  three-month  periods  ended  June  30,  1999  and  1998,
respectively.  Amortization was $4.6 million and $2.7 million for the  six-
month  periods  ended  June  30,  1999 and  1998,  respectively.  Value  of
insurance  in  force amortization expense for the six-month  periods  ended
June  30, 1999 and 1998 represented 3.1% and 2.0%, on an annualized  basis,
of  investment  spread  and  separate  account  fees  for  1999  and  1998,
respectively.

Federal income tax expense was $11.1 million or 34.8% and $12.5 million  or
34.2% of pretax income for the three-month periods ended June 30, 1999  and
1998,  respectively.  The federal income tax expense was $25.0  million  or
34.8%  and $24.4 million or 32.7% for the six-month periods ended June  30,
1999 and 1998, respectively.  The increase in the effective tax rate is due
to the decrease of certain permanent differences coupled with an adjustment
to the 1998 deferred tax liability.

Financial Condition

Stockholder's  equity as of June 30, 1999 was $1.125  billion  compared  to
$1.136  billion  as  of December 31, 1998.  The $10.2 million  decrease  in
stockholder's equity was due to $46.8 million of net income for the period,
offset  by  a  decline in accumulated other comprehensive income  of  $47.0
million and a $10.0 million dividend paid to the parent company.

Investments, excluding cash and cash equivalents, totaled $12.7 billion  at
June 30, 1999 compared to $12.6 billion at December 31, 1998.

The  Company's  general investment policy is to hold  bonds  for  long-term
investment and, accordingly, the Company does not have a trading portfolio.
To  provide for maximum portfolio flexibility and appropriate tax planning,
the  Company  classifies  its bond portfolio as "available  for  sale"  and
carries such investments at fair value.  The Company's total investments at
June  30,  1999  and  December 31, 1998 reflected  gross  unrealized  gains
(losses) of $(117.6) million and $105.3 million, respectively, relating  to
its bond and equity portfolios.

Approximately $11.5 billion, or 82.6%, of the Company's general account and
certain  separate  account  investments at June  30,  1999,  was  rated  by
Standard   &  Poor's  Corporation,  Moody's  Investors  Service  or   under
comparable   statutory  rating  guidelines  established  by  the   National
Association  of  Insurance Commissioners (NAIC).  At  June  30,  1999,  the
carrying value of investments in below investment grade securities  totaled
$1.2  billion,  or  8.9%  of general account and certain  separate  account
investments of $14.0 billion.  Below investment grade securities  generally
provide  higher  yields  and involve greater risks  than  investment  grade
securities  because their issuers typically are more highly  leveraged  and
more  vulnerable  to  adverse  economic conditions  than  investment  grade
issuers.  In addition, the trading market for these securities may be  more
limited than for investment grade securities.

The carrying value of non-income producing securities at June 30, 1999 and
December 31, 1998 was approximately $18.2 milllion and $30.0 million,
respectively.

Derivatives

As  a  component of its investment strategy and to reduce its  exposure  to
interest  rate  risk,  the Company utilizes interest rate  swap  agreements
("swap agreements") and interest rate cap agreements ("cap agreements")  to
match  assets more closely to liabilities.  Swap agreements are  agreements
to  exchange  with  a  counterparty interest  rate  payments  of  differing
character  (e.g., fixed-rate payments exchanged for variable-rate payments)
based  on  an  underlying principal balance (notional principal)  to  hedge
against  interest  rate  changes.   The  Company  currently  utilizes  swap
agreements to reduce asset duration and to better match interest earned  on
longer-term fixed-rate assets with interest credited to policyholders.  The
Company  had  59  and  42  outstanding swap agreements  with  an  aggregate
notional  principal amount of $2.7 billion and $2.4 billion as of June  30,
1999 and December 31, 1998, respectively.

Cap  agreements are agreements with a counterparty that require the payment
of  a  premium for the right to receive payments for the difference between
the  cap interest rate and a market interest rate on specified future dates
based  on  an  underlying principal balance (notional principal)  to  hedge
against rising interest rates. The Company had interest rate cap agreements
with an aggregate notional amount of $250.0 million as of June 30, 1999 and
December 31, 1998.

With  respect  to the Company's equity-indexed annuities, the Company  buys
call  options and futures on the S&P 500 Index to hedge its obligations  to
provide returns based upon this index.  The Company had call options with a
carrying value of $673.4 million and $535.6 million as of June 30, 1999 and
December  31, 1998, respectively.  The Company had futures with a  carrying
value  of $(4.9) million and $(.6) million as of June 30, 1999 and December
31, 1998, respectively.

There are risks associated with some of the techniques the Company uses  to
match  its assets and liabilities.  The primary risk associated with  swap,
cap and call option agreements is counterparty nonperformance.  The Company
believes  that  the  counterparties  to  its  swap,  cap  and  call  option
agreements  are  financially  responsible and that  the  counterparty  risk
associated with these transactions is minimal.  Future contracts  trade  on
organized exchanges and, therefore, have minimal credit risk.  In addition,
swap and cap agreements have interest rate risk and call options and future
contracts  have  stock  market risk.  These swap and cap  agreements  hedge
fixed-rate assets and the Company expects that any interest rate  movements
that  adversely affect the market value of swap agreements would be  offset
by  changes in the market values of such fixed-rate assets.  However, there
can  be no assurance that these hedges will be effective in offsetting  the
potential  adverse  effects of changes in interest rates.   Similarly,  the
call options and futures hedge the Company's obligations to provide returns
on  equity-indexed annuities based upon the S&P 500 Index, and the  Company
believes  that any stock market movements that adversely affect the  market
value  of  S&P  500  Index call options and futures would be  substantially
offset  by a reduction in policyholder liabilities.  However, there can  be
no  assurance  that  these  hedges  will be  effective  in  offsetting  the
potentially  adverse  effects of changes in  S&P  500  Index  levels.   The
Company's  profitability could be adversely affected if the  value  of  its
swap  and  cap  agreements increase less than (or decrease more  than)  the
change in the market value of its fixed rate assets and/or if the value  of
its  S&P Index 500 call options and futures increase less than (or decrease
more   than)   the   value  of  the  guarantees  made   to   equity-indexed
policyholders.

In   June  1998,  Statement  of  Financial  Accounting  Standard  No.   133
"Accounting for Derivative Instruments and Hedging Activities" was  issued.
This  statement standardizes the accounting for derivative instruments  and
the  derivative  portion  of  certain other  contracts  that  have  similar
characteristics by requiring that an entity recognize those instruments  at
fair  value.   This statement also requires a new method of accounting  for
hedging  transactions, prescribes the type of items and  transactions  that
may  be  hedged, and specifies detailed criteria to be met to  qualify  for
hedge  accounting.  In June 1999, SFAS No. 137 "Accounting  for  Derivative
Instruments and Hedging Activities - Deferral of the Effective Date of FASB
Statement  No. 133" was issued.  SFAS 137 defers for one year the effective
date  of SFAS 133.  The rule now will apply to all fiscal quarters  of  all
fiscal years beginning after June 15, 2000.  Earlier adoption is permitted.
Upon  adoption, the Company will be required to record a cumulative  effect
adjustment  to reflect this accounting change.  At this time,  the  Company
has  not completed its analysis and evaluation of the requirements and  the
impact of this statement.

Liquidity

The  Company's  liquidity  needs and financial  resources  pertain  to  the
management  of  the general account assets and policyholder balances.   The
Company  uses cash for the payment of annuity and life insurance  benefits,
operating   expenses,  policy  acquisition  costs,  and  the  purchase   of
investments.   The  Company  generates  cash  from  annuity  premiums   and
deposits,  net  investment income, and from maturities  and  sales  of  its
investments.   Annuity premiums, maturing investments  and  net  investment
income  have  historically  been sufficient  to  meet  the  Company's  cash
requirements.  The Company monitors cash and cash equivalents in an  effort
to  maintain  sufficient liquidity and has strategies in place to  maintain
sufficient  liquidity  in changing interest rate environments.   Consistent
with  the nature of its obligations, the Company has invested a substantial
amount of its general account assets in readily marketable securities.   At
June  30,  1999, $10.3 billion, or 73.8%, of the Company's general  account
investments are considered readily marketable.

To  the extent that unanticipated surrenders cause the Company to sell  for
liquidity purposes a material amount of securities prior to their maturity,
such  surrenders  could  have a material adverse  effect  on  the  Company.
Although no assurance can be given, the Company believes that liquidity  to
fund withdrawals would be available through incoming cash flow, the sale of
short-term  or floating-rate instruments, thereby precluding  the  sale  of
fixed maturity investments in a potentially unfavorable market.

Current  Rhode  Island insurance law permits the payment  of  dividends  or
distributions  from the Company to Liberty Financial, which, together  with
dividends  and  distributions paid during the preceding 12 months,  do  not
exceed  the  lesser  of (i) 10% of statutory surplus as  of  the  preceding
December  31 or (ii) the net gain from operations for the preceding  fiscal
year.   Any  proposed  dividend  in excess of  this  amount  is  called  an
"extraordinary  dividend" and may not be paid until it is approved  by  the
Commissioner  of Insurance of the State of Rhode Island.  As  of  June  30,
1999, the amount of additional dividends that the Company could pay without
such approval was $49.1 million.

Based  upon the historical cash flow of the Company, the Company's  current
financial condition and the Company's expectation that there will not be  a
material adverse change in the results of operations of the Company and its
subsidiaries during the next twelve months, the Company believes that  cash
flow  provided  by  operating  activities over  this  period  will  provide
sufficient liquidity for the Company to meet its liquidity needs.

Year 2000

Many  companies and organizations have computer programs that use only  two
digits  to identify a year in the date field.  These programs were designed
and  developed without considering the impact of the upcoming change in the
century.   The  Company  relies  significantly  on  computer  systems   and
applications  in its operations.  Some of these systems are  not  presently
Year  2000  compliant.  If not corrected, this could cause system failures.
Such  failures  could  have  an  adverse  effect  on  the  Company  causing
disruption  of operations, including, among other things, an  inability  to
process transactions.

In  addressing the Year 2000 issue, the Company has completed an  inventory
of  its  computer  programs  and assessed its  Year  2000  readiness.   The
Company's  computer programs include internally developed  programs,  third
party  purchased  programs and third-party custom developed  programs.  For
programs  which were identified as not being Year 2000 ready,  the  Company
has  implemented a remediation plan which includes repairing  or  replacing
the programs and appropriate testing for Year 2000. The remediation plan is
substantially  complete and is currently in the final  testing  phase.  The
Company also identified its non-information technology systems with respect
to  Year  2000 issues.  The Company initiated remediation efforts  in  this
area and expects to complete this phase during 1999.

The   Company  has  initiated  communication  with  significant   financial
institutions,  distributors,  suppliers  and  others  with  which  it  does
business  to  determine  the  extent to which  the  Company's  systems  are
vulnerable  by  the  failure of others to remediate  their  own  Year  2000
issues.  The Company has received feedback from such parties and is in  the
process of independently confirming information received from other parties
with respect to their year 2000 issues.

The  Company is developing, and will continue to develop, contingency plans
for  dealing with any adverse effects that become likely in the  event  the
Company's  remediation plans are not successful or third  parties  fail  to
remediate  their  own  Year  2000 issues. If  necessary  modifications  and
conversions are not made, or are not timely completed, or if the systems of
the companies on which the Company's interface system relies are not timely
converted,  the  Year  2000  issues could have a  material  impact  on  the
financial condition and results of operations of the Company.  However, the
Company   believes  that  with  modifications  to  existing  software   and
conversions  to new software, the Year 2000 issue will not pose significant
operational problems for its computer systems.

Effects of Inflation

Inflation  has  not  had  a material effect on the  Company's  consolidated
results of operations to date. The Company manages its investment portfolio
in  part to reduce its exposure to interest rate fluctuations.  In general,
the  fair  value  of  the Company's fixed maturity portfolio  increases  or
decreases in inverse relationship with fluctuations in interest rates,  and
the  Company's  net  investment income increases  or  decreases  in  direct
relationship  with  interest rate changes. For example, if  interest  rates
decline the Company's fixed maturity investments generally will increase in
fair  value,  while net investment income will decrease as  fixed  maturity
investments mature or are sold and the proceeds are reinvested  at  reduced
rates.  However, inflation may result in increased operating expenses  that
may not be readily recoverable in the prices of the services charged by the
Company.

Item 3.  Quantitative and Qualitative Disclosure of Market Risk

There have not been any material changes during the six-month period ended
June 30, 1999 in the market risks the Company is exposed to and the
management of such risks, which are summarized in our 1998 Form 10-K.

Item 6.  Exhibits and Reports on Form 8-K

(a)  Exhibit

       #27  Financial Data Schedule - page 16

(b)  Reports on Form 8-K

       There were no reports filed on Form 8-K during the quarter ended
June 30, 1999.










                                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.



                                    KEYPORT LIFE INSURANCE COMPANY

                                   _/s/ Bernhard M. Koch__________
                                    Bernhard M. Koch
                                    Senior Vice President and
                                    Chief Financial Officer
                                    (Principal Financial Officer)


                                   _/s/ Jeff Whitehead__________
                                    Jeff Whitehead
                                    Vice President and Treasurer
                                    (Chief Accounting Officer)




Date:  August 13, 1999













                               Exhibit Index



Exhibit No.       Description                            Page

   27             Financial Data Schedule                 16