SECURITIES AND EXCHANGE COMMISSION
                     Washington, D.C. 20549
                                
                            FORM 10-K
                                
      Annual Report Pursuant to Section 13 or 15(d) of the
                 Securities Exchange Act of 1934


For the Fiscal Year Ended                           Commission File
December 31, 1995                                   No. 1-1569


               AMERICAN PREMIER UNDERWRITERS, INC.


Incorporated under                                  IRS Employer I.D.
the Laws of Pennsylvania                            No. 23-6000765

         One East Fourth Street, Cincinnati, Ohio 45202
                         (513) 579-6600


Securities Registered Pursuant to Section 12(b) of the Act:  None

Securities Registered Pursuant to Section 12(g) of the Act:  None

Other Securities for which reports are submitted pursuant to
Section 15(d) of the Act:
               9-3/4%  Subordinated Notes due 1999
               10-5/8% Subordinated Notes due 2000
               10-7/8% Subordinated Notes due 2011
                                
   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,
and (2) has been subject to such filing requirements for the past
90 days.  Yes  X    No ____

   Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K is not contained herein,
and need not be contained, to the best of registrant's knowledge,
in definitive proxy or information statements incorporated by
reference in Part III of this Form 10-K or any amendment to this
Form 10-K.  [X]

   As of March 1, 1996, there were 47,000,000 shares of the
Registrant's Common Stock outstanding, all of which were owned by
American Financial Group, Inc.

                      _____________________

           Documents Incorporated by Reference:  None






<PAGE>
               AMERICAN PREMIER UNDERWRITERS, INC.
                                
                     INDEX TO ANNUAL REPORT
                                
                          ON FORM 10-K


Part I                                                          Page
 Item  1.  Business:
             Introduction                                          1 
             Insurance Operations                                  2
             Investment Portfolio                                 12
             Non-Insurance Assets                                 13
             Employees                                            13

 Item  2.  Properties                                             14
 Item  3.  Legal Proceedings                                      15
 Item   4.   Submission of Matters to a Vote of Security  Holders  *

Part II
 Item  5.  Market for Registrant's Common Equity and Related
             Stockholder Matters                                  17
 Item  6.  Selected Financial Data                                17
 Item  7.  Management's Discussion and Analysis of Financial
             Condition and Results of Operations                  18
 Item  8.  Financial Statements and Supplementary Data            23
 Item  9.  Changes in and Disagreements with Accountants on
             Accounting and Financial Disclosure                  23

Part III
 Item 10.  Directors and Executive Officers of  the  Registrant   24
 Item 11.  Executive Compensation                                 25
 Item 12.  Security Ownership of Certain Beneficial Owners
             and Management                                       25
 Item 13.  Certain Relationships and Related Transactions         25

Part IV
  Item 14. Exhibits, Financial Statement Schedules, and Reports 
             on Form 8-K                                         S-1



*  The response to this Item is "none".





<PAGE>
      
                             PART I
                                
                             ITEM 1
                                
                            Business

Introduction

     American Premier Underwriters, Inc. (the "Company") was
incorporated in Pennsylvania in 1846.  The Company changed its
name in 1994 from The Penn Central Corporation to American
Premier Underwriters, Inc. in order to better reflect its
identity as a property and casualty insurance specialist.  Its
address is One East Fourth Street, Cincinnati, Ohio 45202; its
telephone number is (513) 579-6600.

     The Company's principal operations are conducted by a group
of nonstandard private passenger automobile insurance companies
(the "NSA Group") and by Republic Indemnity Company of America
("Republic Indemnity"), a California workers' compensation
insurance company.

     On April 3, 1995, the Company became a wholly-owned
subsidiary of American Premier Group, Inc., a new corporation
formed by the Company for the purpose of acquiring all of the
common stock of the Company and American Financial Corporation
(the "Mergers").  On June 9, 1995, American Premier Group changed
its name to American Financial Group, Inc. ("AFG").  Under terms
of the Mergers, (a) the Company merged with a subsidiary of AFG
and each share of Company Common Stock then outstanding was
converted into one share of AFG Common Stock, and (b) American
Financial Corporation ("AFC") merged with another subsidiary of
AFG and all shares of AFC common stock were exchanged for 28.3
million shares of AFG Common Stock.  As a result of the Mergers,
all of the common stock of the Company and AFC is owned by AFG
and AFG is the Company's successor as the issuer of publicly held
common stock.

     Largely due to its divestitures of non-insurance assets over
recent years, the Company had substantial amounts of cash, short-
term investments and marketable securities (other than those held
by its insurance operations) at the date of the Mergers.  One of
the strategic objectives of the Mergers was to provide an
opportunity to redeploy most of these Parent Company assets to
produce a higher rate of return than has been available on the
instruments in which they have been invested.  This objective was
achieved through the utilization of such assets for the early
retirement of relatively expensive debt; approximately $180
million of Company debt was retired and interest-bearing loans of
$623 million were made to AFC which retired nearly $600 million
of its debt.

     Management expects that the Company's 1995 consolidated
Federal income tax return will report a remaining net operating
loss carryforward currently estimated at $476 million, which will
expire at the end of 1996 unless previously utilized, and
remaining capital loss carryforwards estimated at $311 million,
portions of which will expire in various amounts between 1997 and
1999 unless previously utilized.  See Note J of Notes to
Financial Statements.

     Set forth below is a narrative description of the business
operations of the Company's Insurance segment, which is the only
reportable industry segment for which financial information is
presented in the financial statements in Item 8 of this Report.
In addition, information is presented with respect to the
Company's "Non-Insurance Assets."





                                1
<PAGE>
Insurance Operations

     The Company's principal operations are conducted through
specialty property and casualty insurance subsidiaries that
underwrite and market nonstandard automobile and workers'
compensation insurance.  Each subsidiary is comprised of multiple
business units which operate autonomously but with strong central
financial controls and full accountability.  Decentralized
control allows each unit the autonomy necessary to respond to
local and specialty market conditions while capitalizing on the
efficiencies of centralized investment, actuarial, financial and
legal support functions.

     The primary objective of the Company's insurance operations
is to achieve underwriting profitability.  Management's focus on
underwriting profitability has resulted in a statutory combined
ratio averaging 98.5% for the period 1991 to 1995, as compared to
109.3% for the property and casualty industry over the same
period (Source: A.M. Best).  The statutory combined ratio was
104.8% in 1995, compared with the property and casualty insurance
industry estimated average of 107.2% (Source: A.M. Best).  The
GAAP combined ratio for 1995 was 102.0% compared with 97.0% for
1994.  The increase in the 1995 GAAP combined ratio was due
primarily to inadequate rate levels in certain markets and
weather-related losses, principally from hailstorms in Texas.

     Although financial data is reported on a statutory basis for
insurance regulatory purposes, it is reported in accordance with
GAAP for shareholder and other investment purposes.  In general,
statutory accounting results in lower capital surplus and net
earnings than result from application of GAAP.  Major differences
include charging policy acquisition costs to expense as incurred
rather than spreading the costs over the periods covered by the
policies; netting of reinsurance recoverables and prepaid
reinsurance premiums against the corresponding liability;
requiring additional loss reserves and charging to surplus
certain assets, such as furniture and fixtures and agents'
balances over 90 days old.  Unless otherwise noted, all
information presented in this report with respect to the
Company's insurance operations is reported on a GAAP basis.





























                                2
<PAGE>     
     The following table presents certain information with
respect to the Company's insurance operations (dollars in
millions).

                                    1995       1994        1993

Net written premiums            $1,492.3   $1,635.5    $1,378.9

Net earned premiums             $1,495.4   $1,557.9    $1,273.6
Loss and loss adjustment
  expenses ("LAE")               1,198.5    1,090.7       856.9
Underwriting expenses              331.1      344.8       275.3
Policyholder dividends (a)          (5.0)      75.7        93.2
Underwriting profit (loss)      $  (29.2)  $   46.7    $   48.2

GAAP ratios:
 Loss and LAE ratio                 80.2%      70.0%       67.3%
 Underwriting expense ratio         22.1       22.1        21.6
 Policyholder dividend ratio (a)     (.3)       4.9         7.3
 Combined ratio                    102.0%      97.0%       96.2%

Statutory ratios:
 Loss and LAE ratio                 80.1%      70.0%       67.9%
 Underwriting expense ratio         21.7       22.1        21.2
 Policyholder dividend ratio (a)     3.0        6.4         4.9
 Combined ratio                    104.8%      98.5%       94.0%

Industry statutory combined 
  ratio (b)                        107.2%     108.5%      106.9%
   
(a)Reflects a change in the nature of the California workers'
   compensation business.  See "Management's Discussion and
   Analysis--Results of Operations--Republic Indemnity."

(b)Industry information was derived from "Best's Review -
   Property/Casualty" (January 1996 edition).

  Nonstandard Automobile Insurance

     General.  The NSA Group underwrites private passenger
automobile physical damage and liability policies for
"nonstandard risks."  The NSA Group has four principal operating
units comprised of Atlanta Casualty Company, Windsor Insurance
Company, Infinity Insurance Company and Leader National Insurance
Company and their respective subsidiaries ("Atlanta Casualty",
"Windsor", "Infinity" and "Leader National", respectively) and
includes a total of thirteen domestic insurance companies.  In
November 1995, A.M. Best, which rates insurance companies based
upon factors of concern to policyholders, downgraded its rating
of Atlanta Casualty and Windsor from "A+" (Superior) to "A"
(Excellent) and affirmed its rating of "A" (Excellent) for
Infinity and  "A-" (Excellent) for Leader National.  In
announcing the rating adjustments of these companies, A.M. Best
expressed its opinion that each of these new ratings reflects
primarily the "significant financial leverage" of AFG.  At the
time of the Mergers, AFG's ratio of debt to total capital was
nearly 60%; at December 31, 1995, the ratio had improved to
approximately 30%.

     Nonstandard insureds are those individuals who are unable to
obtain insurance through standard market carriers due to factors
such as age, record of prior accidents, driving violations,
particular occupation or type of vehicle.  Premium rates for
nonstandard risks are generally higher than for standard risks.
Total private passenger automobile insurance premiums written by
insurance carriers in the United States in 1995 have been
estimated by A.M. Best to be approximately $103 billion.  Because
it can be viewed as a residual market, the size of the
nonstandard private passenger automobile insurance



                                3
<PAGE>
market changes with the insurance environment and grows when
standard coverage becomes more restrictive.  When this occurs,
the criteria which differentiate standard from nonstandard
insurance risks change.  The size of the voluntary nonstandard
market is also affected by the rate levels adopted by state
administered involuntary plans.  Although these factors make it
difficult to estimate the size of the nonstandard market,
management believes that the voluntary nonstandard market has
accounted for approximately 15% of total private passenger
automobile insurance premiums written in recent years.

     The NSA Group attributes its premium growth in recent years
primarily to entry into additional states, increased market
penetration in its existing states, overall growth in the
nonstandard market, premium rate increases and its purchase of
Leader National.  Management believes the nonstandard market has
experienced growth in recent years as standard insurers have
become more restrictive in the types of risks they will write.

     The NSA Group writes business in 41 states and holds
licenses to write policies in 48 states and the District of
Columbia.  The U.S. geographic distribution of the NSA Group's
statutory written premiums in 1995 compared to 1991 is presented
below.  All business written in Texas and included in the table
was assumed from an affiliate.  In addition, the NSA Group writes
approximately $50 million (4%) of its net premiums annually in
the United Kingdom.

   State        1995    1991       State         1995    1991

   Texas        11.6%     - %      Pennsylvania   3.8%     -%
   Florida      11.0    21.5       Oklahoma       3.8     1.7
   Georgia       9.9    20.5       Indiana        3.6     4.2
   California    8.1      -        Mississippi    3.4     4.3
   Connecticut   5.4     5.6       Alabama        3.1     4.0
   Arizona       4.4     2.7       Other         27.8    29.9
   Tennessee     4.1     5.6                    100.0%  100.0%


     Management believes that the NSA Group's underwriting
success as compared to the automobile insurance industry as a
whole has been due, in part, to the refinement of various risk
profiles, thereby dividing the consumer market into more defined
segments which can be underwritten or priced properly.  The NSA
Group also generally writes policies of short duration which
allow more frequent rating evaluations of individual risks,
providing management greater flexibility in the ongoing
assessment of the business.  In addition, the NSA Group has
implemented cost control measures both in the underwriting and
claims handling areas.





















                                 4
<PAGE>
     The following table presents certain information for the NSA
Group (dollars in millions).

                                    1995       1994        1993

Net written premiums            $1,203.2   $1,154.1    $  901.9

Net earned premiums             $1,191.4   $1,071.9    $  804.4
Loss and LAE                       997.0      813.7       575.8
Underwriting expenses              262.1      256.3       204.4
Underwriting profit (loss)      $  (67.7)  $    1.9    $   24.2

GAAP ratios:
 Loss and LAE ratio                 83.7%      75.9%       71.6%
 Underwriting expense ratio         22.0       23.9        25.4
 Combined ratio                    105.7%      99.8%       97.0%

Statutory ratios: (a)
 Loss and LAE ratio                 83.7%      76.0%       72.5%
 Underwriting expense ratio         21.4       23.7        24.4
 Combined ratio                    105.1%      99.7%       96.9%

Industry statutory combined 
  ratio (b)                        102.3%     101.3%      101.7%
   
(a)Excludes non-U.S. operations, for which statutory accounting
   is not comparable.

(b)Industry information was derived from "Best's Review -
   Property/Casualty" (January 1996 edition).  The comparison
   shown is to the private passenger automobile insurance
   industry.  Although the Company believes that there is no
   reliable regularly published combined ratio data for the
   nonstandard automobile insurance industry, the Company
   believes that such a combined ratio would be lower than the
   private passenger automobile industry average shown above.

     Marketing.  Each of the principal units in the NSA Group is
responsible for its own marketing, sales, underwriting and claims
processing.  Sales efforts are primarily directed toward
independent agents to convince them to select an NSA Group
insurance company for their customers.  These units each write
policies through several thousand independent agents.

     Of the approximately one million NSA Group policies in force
at December 31, 1995, approximately 90% had policy limits of
$50,000 or less per occurrence.  Most NSA Group policies are
written for policy periods of six months or less, and some are as
short as one month.

     Reinsurance.  Due in part to the limited exposure on
individual policies, none of the insurance carriers in the NSA
Group is involved to a material degree in reinsuring risks with
third party insurance companies.  Risks written by NSA Group
companies in excess of certain limits are in some cases reinsured
with a major reinsurance company.  In general, the risk retained
by the NSA Group companies is $500,000 of ultimate net loss for
each occurrence and certain portions of ultimate net losses in
excess of such limits. Reinsurance premiums paid by the NSA Group
in 1995 amounted to less than 1% of net written premiums of the
NSA Group for the period.

     Competition.  A large number of national, regional and local
insurers write nonstandard private passenger automobile insurance
coverage.  Insurers in this market generally compete on the basis
of price (including differentiation on liability limits, variety
of coverages offered and deductibles), geographic availability
and ease of enrollment and, to a lesser



                                 5
<PAGE>
extent, reputation for claims handling, financial stability and
customer service.  NSA Group management believes that
sophisticated data analysis for refinement of risk profiles has
helped the NSA Group to compete successfully.  The NSA Group
attempts to provide selected pricing for a wider spectrum of
risks and with a greater variety of payment options, deductibles
and limits of liability than are offered by many of its
competitors.

      Regulation.  The Company's insurance subsidiaries are
subject to regulation in the jurisdictions in which they do
business.  In general, the insurance laws of the various states
establish regulatory agencies with broad administrative powers
governing, among other things, premium rates, solvency standards,
licensing of insurers, agents and brokers, trade practices, forms
of policies, maintenance of specified reserves and capital for
the protection of policyholders, deposits of securities for the
benefit of policyholders, investment activities and relationships
between insurance subsidiaries and their parents and affiliates.
Material transactions between insurance subsidiaries and their
parents and affiliates generally must be disclosed and prior
approval of the applicable insurance regulatory authorities
generally is required for any such transaction which may be
deemed to be extraordinary.  In addition, while regulations
differ from state to state, they typically restrict the maximum
amount of dividends that may be paid by an insurer to its
shareholders in any twelve-month period without advance
regulatory approval.  Such limitations are generally based on
earnings or statutory surplus.  Without such approval, the
maximum amount of dividends that may be paid by the NSA Group to
the Company during 1996 is $50.9 million.

     Most states have created insurance guarantee associations to
provide for the payment of claims for which insolvent insurers
are liable but which cannot be paid out of such insolvent
insurers' assets.  In 1995, the NSA Group companies were assessed
approximately $100,000 by such associations.

     In addition, many states have created "assigned risk" plans
or similar arrangements to provide state mandated minimum levels
of automobile liability coverage to drivers whose driving records
or other relevant characteristics make it difficult for them to
obtain insurance otherwise.  Automobile insurers in those states
are required to provide such coverage to a proportionate number
of those drivers applying as assigned risks.  Premium rates for
assigned risk business are established by the regulators of the
particular state plan and are frequently inadequate in relation
to the risks insured, resulting in underwriting losses.  Assigned
risks accounted for less than 1% of net written premiums of the
NSA Group companies in 1995.

     In 1995, the NSA Group received approximately $91 million in
direct written premiums from California.  In 1988, California
voters approved Proposition 103 which required insurance
companies to roll back automobile insurance rates to 80% of year-
earlier levels, maintain those rates for one year and obtain
prior approval of rate increases thereafter.  The Company's
acquisition of the NSA Group in 1990 was structured to protect
the Company against the consequences of any rate rollback applied
to the acquired operations.  As for the prior approval
requirements, current legislation in California generally
provides that applications for rate increases will be
deemed approved after 180 days unless disapproved by the
Department of Insurance.  The Company is unable to predict
whether or at what level future rate increases, when applied for,
may be approved. Over time, the failure to receive appropriate
rate increases could result in reduced underwriting profitability
in California for the NSA Group.  In addition, the Company could
experience loss of premium volume in California as a result of
actions it would take to maintain such profitability.







                                 6
<PAGE>  
  Workers' Compensation Insurance

     General.  Republic Indemnity has been engaged in the sale of
workers' compensation insurance in California for many years.
More than 96% of its business in 1995 was written in California.
In addition, it is licensed to write business in Arizona, which
contributed approximately 3% of direct written premium in 1995,
and 22 other states.  In November 1995, A.M. Best downgraded its
rating of Republic Indemnity from "A+" (Superior) to "A"
(Excellent).  In announcing the rating adjustment of Republic
Indemnity, A.M. Best expressed its opinion that this new rating
reflects primarily the "significant financial leverage" of AFG.
At the time of the Mergers, AFG's ratio of debt to total capital
was nearly 60%; at December 31, 1995, the ratio had improved to
approximately 30%.

     Workers' compensation insurance policies provide coverage
for workers' compensation and employer's liability.  The workers'
compensation portion of the coverage provides for statutorily
prescribed benefits that employers are required to pay to
employees who are injured in the course of employment including,
among other things, temporary or permanent disability benefits,
death benefits, medical and hospital expenses and expenses of
vocational rehabilitation.  The benefits payable and the duration
of such benefits are set by statute, and vary with the nature and
severity of the injury or disease and the wages, occupation and
age of the employee.  The employer's liability portion of the
coverage provides protection to an employer for its liability for
losses suffered by its employees which are not included within
the statutorily prescribed workers' compensation coverage.
Republic Indemnity generally issues policies for one-year
periods.

     Workers' compensation insurance operations are affected by
employment trends in their markets, litigation activities, legal
and medical costs, use of vocational rehabilitation programs and
the provision of benefits for stress and trauma claims.
Historically, the incidence of higher claims costs would
ultimately have been reflected in premium rate adjustments.  With
the advent of the Reform Legislation as defined below under
"Competition", such increases in claims costs might not
necessarily be used in the setting of premium rates, which may
unfavorably affect underwriting results.




























                                 7
<PAGE>     
     The following table presents certain information for
Republic Indemnity (dollars in millions).

                                  1995       1994        1993

Net written premiums            $287.5     $479.5      $465.8

Net earned premiums             $303.5     $483.8      $458.5
Loss and LAE                     202.9      276.7       270.2
Underwriting expenses             68.9       88.3        70.6
Policyholder dividends            (5.0)      75.7        93.2
Underwriting profit             $ 36.7     $ 43.1      $ 24.5

GAAP ratios:
 Loss and LAE ratio               66.8%      57.2%       59.0%
 Underwriting expense ratio       22.7       18.3        15.4
 Policyholder dividend ratio      (1.6)      15.6        20.3
 Combined ratio                   87.9%      91.1%       94.7%

Statutory ratios:
 Loss and LAE ratio               66.8%      57.2%       59.0%
 Underwriting expense ratio       23.1       18.3        15.4
 Policyholder dividend ratio      14.8       20.4        13.7
 Combined ratio                  104.7%      95.9%       88.1%

Industry statutory combined 
  ratio (a)                      103.0%     101.4%      109.1%
   
(a)Industry information was derived from "Best's Review -
   Property/Casualty" (January 1996 edition).

     Marketing.  Republic Indemnity writes insurance through
approximately 700 independent property and casualty insurance
agents.  In 1995, none of these produced more than 4.5% of total
premiums.  The largest three of these produced approximately 9%
of total premiums.  Republic Indemnity has in excess of 10,000
policies in force, the largest of which represents approximately
three-tenths of 1% of net premiums written.

     Reinsurance.  In its normal course of business and in
accordance with industry practice, Republic Indemnity reinsures a
portion of its exposure with other insurance companies so as to
limit its maximum loss arising out of any one occurrence.
Reinsurance does not legally discharge the original insurer from
primary liability.  Republic Indemnity retains the first $1.5
million of each loss; the next $1.5 million of each loss is
reinsured with a major reinsurance company; the next $2 million
of each loss is shared equally by Republic Indemnity and the
reinsurance company; and the remaining $145 million of each loss
is covered by reinsurance provided by a group of more than 40
reinsurance companies.  Premiums for reinsurance ceded by
Republic Indemnity in 1995 were less than 1% of net written
premiums for the period.  Republic Indemnity generally does not
assume reinsurance, except as an accommodation to policyholders
who have a small percentage of their employees outside the state
of California.













                                8
<PAGE>     
     Competition.   Republic Indemnity competes with both the
California State Compensation Insurance Fund (the "State Fund")
and over 275 other companies writing workers' compensation
insurance in California.  In recent years, the State Fund has
written approximately 15% to 20% of the direct written premiums
in the insured workers' compensation market in California.  In
addition, many employers are self-insured.

     In 1993, California enacted legislation (the "Reform
Legislation") effecting an immediate overall 7% reduction in
workers' compensation insurance premium rates and replaced the
workers' compensation insurance minimum rate law, effective
January 1, 1995, with a procedure permitting insurers to use any
rate within 30 days after filing it with the Insurance
Commissioner unless the rate is disapproved by the Insurance
Commissioner.  Before this "open rating" policy went into effect,
the Insurance Commissioner ordered additional rate decreases of
12.7% (effective January 1, 1994) and 16% (effective
October 1, 1994).

     The Reform Legislation has had a significant effect on
competition within the California workers' compensation market.
Prior to the repeal of the minimum rate law, competition was
based primarily on an insurer's reputation for paying dividends
to policyholders as a refund of premiums paid when experience
with such policyholders was more favorable than certain specified
levels, subject to the approval of the Board of Directors.
Management believes that Republic Indemnity's record and
reputation for paying relatively high policyholder dividends had
enhanced its competitive position.  With the repeal of the
minimum rate law, the premium rate levels offered by an insurer,
rather than its reputation for paying policyholder dividends, has
become the most important factor affecting competition.  As a
result, Republic Indemnity has modified its rate levels to
reflect a change in its mix of business toward non-participating
policies which are not subject to payment of policyholder
dividends.

     Other competitive factors in the California workers'
compensation market include loss control services, claims
service, service to agents and commission schedules.  While
several companies, including certain of the largest writers,
specialize in writing California workers' compensation insurance,
Republic Indemnity believes its exclusive concentration in the
workers' compensation field yields certain cost advantages and
other favorable effects upon operations.  Republic Indemnity may
be at a competitive disadvantage when businesses that purchase
general property and casualty insurance are encouraged by other
insurers to place their workers' compensation insurance as part
of an overall insurance package.  Although Republic Indemnity is
one of the largest writers of workers' compensation insurance in
California, certain competitors are larger and/or have greater
resources than Republic Indemnity.




















                                 9
<PAGE>     
     The repeal of the minimum rate law has prompted certain
insurers to issue policies with premium rates that are below
projected ultimate losses in an effort to gain market share.
Republic Indemnity intends to maintain its historically strict
underwriting standards as it continues to market its policies at
rates that it believes will provide for both long-term
underwriting profitability and surplus stability.  Republic
Indemnity's focus on underwriting performance in an atmosphere of
extremely competitive pricing could likely prolong what
management believes is a temporary reduction in premium volume.
Republic Indemnity has remained competitive in the current
marketplace by pricing its policies to reflect, among other
things, the absence of policyholder dividend payments as
discussed above, and by reducing its expenses and pursuing
profitable business in other geographic markets.

     Regulation.  The maximum amount of shareholder dividends
paid within any twelve-month period from a California property
and casualty insurance company to its parent without regulatory
approval cannot exceed the greater of 10% of the insurer's
statutory policyholders' surplus as of the preceding December 31,
or 100% of its net income for the year then ended.  Without such
approval, the maximum amount of such dividends that may be paid
by Republic Indemnity during 1996 is $29.5 million.

     Due to the existence of the State Fund, California does not
require participation in any involuntary pools or assigned risk
plans for workers' compensation insurance.  Although California
has guarantee regulations to protect policyholders of insolvent
insurance companies, no assessments were billed to Republic
Indemnity under such regulations for policy year 1995.  However,
if current pricing practices were to persist in the marketplace,
management would expect assessments in future policy years.

     Proposition 103, which is described more fully under
"Nonstandard Automobile Insurance" above, does not apply to
workers' compensation insurance.

    Loss and Loss Adjustment Expense Reserves

     The consolidated financial statements include the estimated
liability for unpaid losses and LAE of the Company's insurance
subsidiaries.  This liability represents estimates of the
ultimate net cost of all unpaid losses and LAE and is determined
by using case-basis evaluations and actuarial projections.  These
estimates are subject to the effects of changes in claim amounts
and frequency and are periodically reviewed and adjusted as
additional information becomes known.  In accordance with
industry practices, such adjustments are reflected in current
year operations.

     Future costs of claims are projected based on historical
trends adjusted for changes in underwriting standards, policy
provisions, the anticipated effect of inflation and general
economic trends.  These anticipated trends are monitored based on
actual development and are reflected in estimates of ultimate
claim costs.

     Generally, reserves for reinsurance and involuntary pools
and associations are reflected in the Company's results at the
amounts reported by those entities.

     See Note L to the Financial Statements for an analysis of
changes in the Company's estimated liability for losses and LAE,
net of reinsurance (and grossed up), over the past three years on
a GAAP basis.







                                10
 <PAGE>
     The following table presents the development of the
liability for losses and LAE, net of reinsurance, on a GAAP basis
for 1989 (the year the Company acquired its first insurance
subsidiary) through 1995.  The top line of the table shows the
estimated liability (in millions) for unpaid losses and LAE
recorded at the balance sheet date for the indicated years.  The
second line shows the re-estimated liability as of December 31,
1995.  The remainder of the table presents development as
percentages of the estimated liability.  The development results
from additional information and experience in subsequent years.
The middle line shows a cumulative redundancy which represents
the aggregate percentage decrease in the liability initially
estimated.  The lower portion of the table indicates the
cumulative amounts paid as of successive periods as a percentage
of the original loss reserves liability.
<TABLE>
<CAPTION>
                                 1989   1990   1991   1992   1993    1994    1995
<S>                              <C>    <C>    <C>   <C>    <C>    <C>     <C>
Liability for unpaid
  losses and LAE:
   As originally estimated....   $369   $602   $664   $764   $916  $1,080  $1,136
   As re-estimated at
    December 31, 1995.........   $308   $539   $607   $669   $832  $1,030
Liability re-estimated as of:
  One year later ............    97.0%  96.5%  97.0%  92.4%  91.4%   95.4%
  Two years later ...........    89.7%  93.0%  93.4%  87.9%  90.8%
  Three years later .........    85.7%  91.0%  90.4%  87.6%
  Four years later ..........    85.5%  89.6%  91.4%
  Five years later ..........    84.7%  89.6%
  Six years later ...........    83.5%

Cumulative Redundancy.........   16.5%  10.4%   8.6%  12.4%   9.2%    4.6%    N/A

Cumulative paid as of:
  One year later ............    19.5%  43.0%  44.1%  40.6%  40.9%   44.5%
  Two years later ...........    49.1%  64.4%  64.5%  59.3%  61.3%
  Three years later .........    64.6%  75.2%  74.2%  72.0%
  Four years later ..........    71.4%  79.8%  80.7%
  Five years later ..........    75.1%  82.3%
  Six years later .........      76.0%
</TABLE>
     The preceding table does not present accident or policy year
development data.  As indicated in the preceding table, the
Company has developed redundancies for all periods presented.
These redundancies were offset, in part, by deficiencies related
to workers' compensation in the 1990 and 1991 accident years.
Furthermore, in evaluating the re-estimated liability and
cumulative redundancy, it should be noted that each percentage
includes the effects of changes in amounts for prior periods.
For example, a redundancy related to losses settled in 1995, but
incurred in 1989, would be included in the re-estimated liability
and cumulative redundancy percentage for each of the years 1989
through 1994.  Conditions and trends that have affected
development of the liability in the past may not necessarily
exist in the future.  Accordingly, it is not appropriate to
extrapolate future redundancies based on this table.

     The differences between the liability for losses and LAE
reported in the annual statements filed with the state insurance
departments in accordance with statutory accounting principles
("SAP") and that reported in the accompanying consolidated
financial statements in accordance with GAAP at December 31,
1995, are as follows (in millions):

   Liability reported on a SAP basis          $1,116

     Reinsurance recoverables                     59
     Reserves of foreign operations               20

   Liability reported on a GAAP basis         $1,195


                                11
<PAGE>
Investment Portfolio

    General.   The following tables present the percentage
distribution and yields of the Company's insurance operations'
investment portfolio (excluding investment in equity securities of
investee corporations) as reflected in its financial statements.
<TABLE>
<CAPTION>
                                          1995   1994   1993   1992    1991
<S>                                       <C>    <C>    <C>    <C>    <C>
Cash and Short-term Investments            3.8%   4.6%   4.9%   5.4%    5.1%
Fixed Maturity Securities:
 U.S. Government and Agencies              4.2    4.3    3.2    3.3     2.8
 State and Municipal                        .5     .6     .9     .7     1.3
 Public Utilities                         12.5   11.8   13.2   15.2    19.2
 Mortgage-Backed Securities                9.0    7.3    9.1   11.8     8.9
 Corporate and Other                      66.5   72.6   67.2   62.4    62.7
                                          96.5  101.2   98.5   98.8   100.0
 Net Unrealized Gain (Loss) on Fixed
   Maturity Securities Available for Sale  3.5   (1.2)   1.5    1.2      -
                                         100.0% 100.0% 100.0% 100.0%  100.0%

Yield on Fixed Maturity Securities:
 Excluding realized gains and losses       7.9%   7.7%   8.3%   9.2%    9.8%
 Including realized gains and losses       9.3%   7.7%   9.3%  11.1%   11.8%
</TABLE>
     Fixed Maturity Investments.  Unlike most insurance groups
which have portfolios that are invested heavily in tax-exempt
bonds, the Company invests substantial amounts in taxable bonds.
The NAIC assigns quality ratings which range from Class 1
(highest quality) to Class 6 (lowest quality).  The following
table shows the Company's bonds and mandatory redeemable
preferred stocks, by NAIC designation (and comparable Standard &
Poor's Corporation rating) as of December 31, 1995 (dollars in
millions):

     NAIC                             Amortized     Market Value
   Rating   Comparable S&P Rating          Cost    Amount       %

      1     AAA, AA, A                   $1,264    $1,326     70%
      2     BBB                             429       447     24
              Total investment grade      1,693     1,773     94
      3     BB                               66        67      4
      4     B                                42        40      2
      5     CCC, CC, C                        -        -      -
      6     D                                 -        -      -
              Total non-investment grade    108       107      6
              Total                      $1,801    $1,880    100%

     Risks inherent in connection with fixed income securities
include loss upon default and market price volatility.  Factors
which can affect the market price of securities include:
creditworthiness, changes in interest rates, the number of market
makers and investors, defaults by major issuers of securities and
public concern about concentrations in certain types of
securities by institutions.













                                12
<PAGE>
Non-Insurance Assets

     Businesses Divested.   In February 1995, the Company
completed the divestiture of its last industrial business with
the sale of its Apparatus unit, which manufactured aerial lift
trucks, for approximately $13 million.

     Coal Properties.  The Company and a subsidiary own fee
interests in coal properties in Illinois, Ohio and Pennsylvania.
Most of these properties are leased at various royalty rates to
coal mining companies under long-term arrangements, including
fixed-term leases with renewal options and exhaustion leases.
The Company does not produce, prepare or sell coal or conduct
mining operations.

     Eight mines operated by lessees of the leased coal
properties supply steam coal for electrical utilities or
industrial customers.  The future level of royalties above
certain minimum and advance royalties from the reserves presently
under lease will depend upon the rate of mining, the change in
certain price indices and, in some instances, the sales price of
the coal.  During 1995, the leased coal properties produced
royalties of approximately
$6 million.

     GCT and Related Development Rights.  Subsidiaries of the
Company own Grand Central Terminal ("GCT") in New York City and
rights (the "Development Rights") to develop or transfer
approximately 1.7 million square feet of floor space in the GCT
area.  The Development Rights are derived from such subsidiaries'
ownership of the land upon which GCT is constructed.  Utilization
or transfer of such rights requires the approval of certain New
York City agencies.  If required governmental approvals are
obtained, the floor space may be developed on certain sites in
the vicinity of GCT, in each case subject to the requirements of
applicable law.  The Company leases GCT (but not the Development
Rights) and its related Harlem and Hudson rail lines to the
Metropolitan Transportation Authority of the State of New York
(the "MTA") for a term expiring in 2274.  Payments received on
the lease amount to $2.4 million annually.  The MTA also has the 
option to purchase the leased property in 2019.

     Real Estate.  Subsidiaries of the Company own certain land
and rights associated with the potential development of areas
adjacent to, and above, the rail line at the Scarsdale, New York
commuter railroad station.  The Village of Scarsdale has
designated a subsidiary of the Company as preferred developer for
the construction of a residential and retail use project adjacent
to such station.

     The Company also has a program for the sale of real estate
assets that relate to its former rail operations and other
surplus land and facilities.

     Oil and Gas Properties. The Company has fractional interests
in oil and gas properties located in the United States.  These
properties produced revenues of $.8 million, $2.0 million and
$2.0 million in 1995, 1994 and 1993, respectively.

     Management Company.  Buckeye Management Company ("Buckeye")
manages as the sole general partner of, and owns a 2% economic
interest in, Buckeye Partners, L.P., which owns and operates
refined petroleum products and crude oil pipelines in the
northeast and midwestern United States.  In March 1996, the
Company sold Buckeye to an investment group consisting of members
of Buckeye's management and employees.

Employees

     The Company and its consolidated subsidiaries employed
approximately 3,700 persons at December 31, 1995.

                                13
<PAGE>
                             ITEM 2

                           Properties

     The Company's operations are conducted principally within
the United States, and the Company believes that its principal
facilities are maintained in good operating condition and are
adequate for the present needs of its operations.

Insurance

     The Company's insurance operations lease offices in the
following locations:
                                                 Square       Lease
                                                   Feet  Expiration
 NSA Group:           Birmingham, Alabama        68,000        2005
                      Atlanta, Georgia           81,000        1998
                      Norcross, Georgia         147,000        2000
                      Independence, Ohio         43,000        1998

 Republic Indemnity:  Encino, California         72,000        2003
                      San Francisco, California  57,000        2001
                      San Diego, California      11,000        1998
                      Other                      16,000   1996-2000

Non-Insurance Assets

     Coal Properties  The Company and a subsidiary own fee
interests in approximately 161,000 acres of coal properties in
Illinois, Ohio and Pennsylvania.  Approximately two-thirds of
these properties remain leased at various royalty rates to coal
mining companies under long-term arrangements, including
fixed-term leases with renewal options and exhaustion leases.

     GCT and Related Development Rights  Subsidiaries of the
Company own Grand Central Terminal and rights to develop floor
space in New York City.

     Real Estate  The Company's real estate inventory at December
31, 1995 included approximately 8,400 acres of real estate spread
throughout 12 states.

     Oil and Gas Properties    The Company owns certain developed
and undeveloped oil and gas properties, located primarily in
Oklahoma.





















                                14
<PAGE>
                             ITEM 3
                                
                        Legal Proceedings

Pre-Reorganization Matters

     The following matters arose out of railroad operations
disposed of by the Company's predecessor, Penn Central
Transportation Company ("PCTC"), prior to its bankruptcy
reorganization in 1978 and, accordingly, any ultimate liability
arising therefrom in excess of previously established loss
accruals would be attributable to pre-reorganization events and
circumstances.  In accordance with the Company's pre-
reorganization accounting policy, any such excess will reduce the
Company's capital surplus and shareholders' equity, but will not
be charged to income.

USX Litigation  In May 1994, lawsuits were filed against the
Company by USX Corporation ("USX") and its former subsidiary,
Bessemer and Lake Erie Railroad Company ("B&LE"), seeking
contribution by the Company, as the successor to the railroad
business conducted by PCTC prior to 1976, for all or a portion of
the approximately $600 million that USX paid in satisfaction of a
judgment against B&LE for its participation in an unlawful
antitrust conspiracy among certain railroads commencing in the
1950's and continuing through the 1970's.  The lawsuits argue
that USX's liability for that judgment is attributable to PCTC's
alleged activities in furtherance of the conspiracy.  On October
13, 1994, the U.S. District Court for the Eastern District of
Pennsylvania enjoined USX and B&LE from continuing their lawsuits
against the Company, ruling that their claims are barred by the
1978 Consummation Order issued by that Court in PCTC's bankruptcy
reorganization proceedings.  USX and B&LE appealed the District
Court's ruling to the U.S. Court of Appeals for the Third
Circuit.  On December 13, 1995, the Court of Appeals reversed the
U.S. District Court decision.  In its opinion, the Court of
Appeals only addressed the Company's procedural argument that the
claims of USX could not proceed because they are barred by the
Consummation Order.  The Third Circuit expressly recognized in
its opinion that it was not deciding any of the Company's
defenses on the merits.

     On January 8, 1996, the Company filed a petition for
rehearing en banc, requesting all of the judges of the Third
Circuit to review the three-judge panel's decision.  That
petition was denied on February 16, 1996.  As a result, the
Company will petition the U.S. Supreme Court to review the
bankruptcy bar issue.  In the event that subsequent reviews do
not reinstate the District Court's injunction and USX's lawsuits
are eventually permitted to go forward, the Company and its
outside counsel believe that the Company has substantial defenses
to these lawsuits and should not suffer a material loss as a
result of this litigation.

Environmental Matters  The Company is a party or named as a
potentially responsible party in a number of proceedings and
claims by regulatory agencies and private parties under various
environmental protection laws, including the Comprehensive
Environmental Response, Compensation and Liability Act
("CERCLA"), seeking to impose responsibility on the Company for
hazardous waste remediation costs at certain railroad sites
formerly owned by PCTC and at certain other sites where hazardous
waste allegedly generated by PCTC's railroad operations is
present.  It is difficult to estimate the Company's liability for
remediation costs at these sites for a number of reasons,
including the number and financial resources of other potentially
responsible parties involved at a given site, the varying
availability of evidence by which to allocate responsibility
among such parties, the wide range of costs for possible
remediation alternatives, changing technology and the period of
time over which these matters develop.  Nevertheless, the Company
believes that its previously established loss accruals for
potential pre-reorganization


                                15
<PAGE>
environmental liabilities at such sites are adequate to cover the
probable amount of such liabilities, based on the Company's
estimates of remediation costs and related expenses at such sites
and its estimates of the portions of such costs that will be
borne by other parties. Such estimates are based on information
currently available to the Company and are subject to future
change as additional information becomes available.  Such
estimates do not assume any recovery from the Company's insurance
carriers, although the Company does intend to seek reimbursement
from certain insurers for such remediation costs as the Company
incurs.

     In terms of potential liability to the Company, the Company
believes that the most significant such site is the railyard at
Paoli, Pennsylvania ("Paoli Yard") which PCTC transferred to
Consolidated Rail Corporation ("Conrail") in 1976.  A Record of
Decision issued by the U.S. Environmental Protection Agency in
1992 presented a final selected remedial action for clean-up of
polychlorinated biphenyls ("PCB's") at Paoli Yard having an
estimated cost of approximately $28 million.  The Company has
accrued its portion of such estimated clean-up costs in its
financial statements (in addition to related expenses) but has
not accrued the entire amount because it believes it is probable
that other parties, including Conrail, will be responsible for
substantial percentages of the clean-up costs by virtue of their
operation of electrified railroad cars at Paoli Yard that
discharged PCB's at higher levels than discharged by cars
operated by PCTC.

    In management's opinion, the outcome of the foregoing
environmental claims and contingencies will not, individually or
in the aggregate, have a material adverse effect on the financial
condition of the Company.  In making this assessment, management
has taken into account previously established loss accruals in
its financial statements and probable recoveries from third
parties.



















                                      16
<PAGE>

                             PART II
                                
                             ITEM 5
                                
  Market for Registrant's Common Equity and Related Stockholder
                             Matters


   Not applicable - All of Registrant's outstanding Common
Stock is owned by American Financial Group, Inc.


                             ITEM 6
                                
                     Selected Financial Data


The following table sets forth certain data for the periods
indicated (dollars in millions).  Year-to-year comparisons are
affected by business dispositions, restructuring provisions and
other non-recurring items.

                                  1995    1994   1993    1992   1991

Earnings Statement Data (a):
Net Written Premiums            $1,492  $1,636 $1,379  $1,067 $  865

Total Revenues                   1,736   1,759  1,736   1,420  1,272

Earnings from Continuing Operations
  before Income Taxes              113      41    190      84     79

Earnings (loss) from:
  Continuing Operations             67       1    243      51     50
  Discontinued Operations           -       (1)   (11)      1    (47)
  Extraordinary Items               (5)     -      -       -      -
  Cumulative Effect of Accounting
    Change                          -       -      -      253     -
Net Earnings                        62      -     232     305        3


Balance Sheet Data:
Total Assets                    $3,955  $4,197 $4,053  $3,493 $3,369

Unpaid Losses and Loss Adjustment
  Expenses, Unearned Premiums and
  Policyholder Dividends         1,684   1,674  1,426   1,069    890

Long-term Debt:
  Parent Company                   321     500    516     650    650
  Subsidiaries                       9      10     10      10     20

Common Shareholder's Equity      1,552   1,549  1,722   1,503  1,479


(a) Amounts above include the following pretax items for the years 
      indicated:
          1994 - Loss on sale of General Cable securities ($76 million).
          1993 - Tax benefit attributable to an increase in the Company's 
                 net deferred tax asset ($132 million); Gain on sale of
                 equity investments ($99 million); Provision for asset
                 impairment ($20 million); Loss on sale of subsidiaries 
                 ($22 million).
          1991 - Provision for asset impairment ($21 million).



                                17
 <PAGE>
                              ITEM 7

               Management's Discussion and Analysis
         of Financial Condition and Results of Operations

GENERAL

    Following is a discussion and analysis of the financial
statements and other statistical data that management believes
will enhance the understanding of the Company's financial
condition and results of operations.  This discussion should
be read in conjunction with the financial statements beginning
on page F-1.

     In April 1995, the Company became a wholly-owned subsidiary
of American Premier Group, Inc., a new corporation formed by the
Company for the purpose of acquiring all of the common stock of
the Company and American Financial Corporation (the "Mergers").
In June 1995, American Premier Group changed its name to American
Financial Group, Inc. ("AFG").  Under terms of the Mergers, (a)
the Company merged with a subsidiary of AFG and each share of
Company Common Stock then outstanding was converted into one
share of AFG Common Stock, and (b) American Financial Corporation
("AFC") merged with another subsidiary of AFG and all shares of
AFC common stock were exchanged for 28.3 million shares of AFG
Common Stock.  As a result of the Mergers, all of the common
stock of the Company and AFC is owned by AFG and AFG is the
Company's successor as the issuer of publicly held common stock.

     The Company's insurance operations consist primarily of a
group of nonstandard private passenger automobile insurance
companies (the "NSA Group") and a business which sells workers'
compensation insurance principally in California ("Republic
Indemnity").

     During 1995, in connection with its previously announced
divestiture effort, the Company completed the sale of its last
industrial business.  In addition, in March 1996 the Company
sold its investment in a subsidiary which holds a 2% general
partnership interest in an independent pipeline common carrier
of refined petroleum products.  See Note C of Notes to
Financial Statements.


LIQUIDITY AND CAPITAL RESOURCES

Ratios   The following ratios may be considered relevant
indicators of the Company's liquidity and are typically presented
by the Company in its prospectuses and similar documents.
Management believes that balance sheet ratios (debt-to-equity)
are more meaningful on a parent only basis.  On the other hand,
earnings statement ratios (fixed charges) are more meaningful on
a total enterprise basis since the parent only ratio is
dependent, to a great degree, on the discretionary nature of
dividend payments from subsidiaries.

    The ratio of the Company's (parent-only) long-term debt to
total capital was 17%, 24% and 23% at December 31, 1995, 1994
and 1993, respectively.  The Company's ratio of earnings to
fixed charges on a total enterprise basis was 3.35, 1.72 and
3.83 for the years ended December 31, 1995, 1994 and 1993,
respectively.

    The National Association of Insurance Commissioners' model
law for risk based capital ("RBC") determines the amount of
capital that an insurance company needs to ensure that it has
an acceptable expectation of not becoming financially
impaired.  At December 31, 1995, the capital ratios of all of
the Company's insurance companies substantially exceeded the
RBC requirements.
                               
                               
                               18
<PAGE>
Sources of Funds   American Premier is organized as a holding
company with almost all of its operations being conducted by
subsidiaries.  The parent corporation, however, has continuing
cash needs for administrative expenses, the payment of
principal and interest on borrowings and common stock
dividends.  Thus, the Company relies primarily on dividends
and tax payments from its subsidiaries for funds to meet its
obligations.

    Prior to the Mergers, the Company had substantial cash and
short-term investments at the parent company level.
Subsequent to the Mergers, the Company repurchased
approximately $180 million of its subordinated notes and made
loans to AFC under a formal credit agreement.  At December 31,
1995, amounts outstanding under the AFC agreement totaled
$623.2 million.  In addition, the Company entered into a
formal credit agreement with AFG.  At December 31, 1995,
amounts payable to AFG under the AFG agreement totaled $84.0
million.

    In December 1995, Pennsylvania Company ("Pennco"), a
wholly-owned subsidiary of the Company, entered into a new
collateralized five-year reducing revolving credit agreement
with several banks, under which it can borrow up to $75
million.  At December 31, 1995, the Company had no outstanding
borrowings under the agreement.

    The Company's federal income tax loss carryforward is
available to offset taxable income and, as a result, the
Company's requirement to pay federal income tax for 1996 is
substantially eliminated.

Uncertainties  The Company and its subsidiaries are parties in
a number of proceedings relating to former operations.  See
Note K of Notes to Financial Statements.  While the results of
all such uncertainties cannot be predicted, based upon its
knowledge of the facts, circumstances and applicable laws,
management believes that sufficient reserves have been
provided.

Investments  Approximately half of the Company's consolidated
assets are invested in marketable securities.  The Company
attempts to optimize investment income while building the
value of its portfolio, placing emphasis upon long-term
performance.  The Company's goal is to maximize return on an
ongoing basis rather than focusing on year-by-year
performance.

    Fixed income investment funds are generally invested in
securities with short-term and intermediate-term maturities
with an objective of optimizing total return while allowing
flexibility to react to changes in market conditions.  At
December 31, 1995, the average life of the Company's bonds and
redeemable preferred stocks was approximately 6 years.

    Approximately 94% of the bonds and redeemable preferred
stocks held by the Company were rated "investment grade"
(credit rating of AAA to BBB) by nationally recognized rating
agencies at December 31, 1995.  Investment grade securities
generally bear lower yields and lower degrees of risk than
those that are unrated and non-investment grade.  Management
believes that the high quality investment portfolio should
generate a stable and predictable investment return.

    At December 31, 1995, the Company's mortgage-backed
securities ("MBSs"), represented approximately 10% of the
Company's bonds and mandatory redeemable preferred stocks.
The Company invests primarily in MBSs which are structured to
minimize prepayment risk.  In addition, the majority of MBSs
held by the Company were purchased at discounts to par value.
Management believes that the structure and discounted nature
of the


                                19
<PAGE>

MBSs will minimize the effect of prepayments on earnings over
the anticipated life of the MBS portfolio.  Substantially all
of the Company's MBSs are rated "AAA" by Standard & Poor's
Corporation and are collateralized primarily by GNMA, FNMA and
FHLMC single-family residential pass-through certificates.
The market in which these securities trade is highly liquid.
Aside from interest rate risk, the Company does not believe a
material risk (relative to earnings and liquidity) is inherent
in holding such investments.

RESULTS OF OPERATIONS - THREE YEARS ENDED DECEMBER 31, 1995

    General  Pretax earnings were $113 million in 1995
compared to $41 million in 1994 and $190 million in 1993.

    Results for 1995 include a $76 million decrease in
    underwriting results of the Company's insurance operations
    and an $8 million decrease in portfolio interest and
    dividend income.  These items were partially offset by $45
    million of interest income from loans to AFC, $24 million
    in realized gains on the sales of securities and an $8
    million decrease in interest on borrowed money.

    Results for 1994 include a $76 million loss on the sale of
    General Cable securities and a $4 million loss on the
    anticipated sale of one of the Company's non-insurance
    businesses.  These items were partially offset by a $26
    million increase in investment income (excluding $25
    million of interest income on the General Cable notes
    recorded in 1993) and a $10 million decrease in interest
    on borrowed money.
    
    Results for 1993 include $99 million in gains from the
    sales of the Company's shares of Tejas Gas Corporation and
    limited partnership units of Buckeye Partners L.P., a $22
    million improvement in underwriting results of the
    Company's insurance operations and a $13 million increase
    in interest income on the General Cable notes.  These
    items were partially offset by a $42 million loss recorded
    on the anticipated sale of the Company's non-insurance
    operations.

Property and Casualty Insurance - Underwriting  Underwriting
profitability is measured by the combined ratio which is a sum
of the ratio of underwriting expenses, losses, and loss
adjustment expenses to premiums.  When the combined ratio is
under 100%, underwriting results are generally considered
profitable; when the ratio is over 100%, underwriting results
are generally considered unprofitable.  The combined ratio
does not reflect investment income, other income or federal
income taxes.

    The Company manages and operates its property and casualty
business as two major sectors.  The NSA Group is a group of
nonstandard automobile insurance companies which underwrite
physical damage and liability policies for "nonstandard
risks."  Nonstandard insureds are those individuals who are
unable to obtain insurance through standard market carriers
due to factors such as age, record of prior accidents, driving
violations, particular occupation or type of vehicle.
Republic Indemnity is engaged in the sale of workers'
compensation insurance in California and, to a lesser extent,
in Arizona.  Workers' compensation policies provide coverage
for statutory prescribed benefits that employers are required
to pay employees who are injured in the course of employment
and for an employer's liability for losses suffered by its
employees which are not included within the statutory
prescribed workers' compensation coverage.





                                 20
<PAGE>    
    Results for the Company's property and casualty insurance
subsidiaries are as follows (dollars in millions):

                                     Year ended December 31,
                                     1995      1994      1993
      Net Written Premiums (GAAP)
       NSA Group                 $1,203.2  $1,154.1  $  901.9
       Republic Indemnity           287.5     479.5     465.8
       Other Lines                    1.6       1.9      11.2
                                 $1,492.3  $1,635.5  $1,378.9

      Combined Ratios (GAAP)
       NSA Group                    105.7%     99.8%     97.0%
       Republic Indemnity            87.9%     91.1%     94.7%
       Aggregate                    102.0%     97.0%     96.2%

    NSA Group   The NSA Group attributes its premium growth in
recent years primarily to entry into additional states,
increased market penetration in its existing states, overall
growth in the nonstandard market, premium rate increases and
the purchase of Leader National in May 1993.  The increase in
the combined ratio for 1995 compared with 1994 was due
primarily to inadequate rate levels in certain markets and
weather-related losses principally from hailstorms in Texas
(1.3 points in the combined ratio).  These factors were
partially offset by a reduction in the underwriting expense
ratio due largely to cost control measures.

     Underwriting conditions in the private passenger
automobile insurance marketplace in 1994 were affected by
competitive conditions and the pricing policies of insurers.
Also, improving economic conditions contributed to increased
driving activity resulting in an increase in the frequency of
accidents and severity of claims.  These trends caused a
deterioration in the NSA Group's underwriting profit margins
during 1994.  These factors were partially offset by
underwriting profit from the NSA Group's entry into certain
markets, as well as improved underwriting margins in several
markets where the book of business matured and a greater
portion of new premium was derived from renewal policies.

    Premium rate increases were implemented in several states
during 1994 and 1995.  Rate increases implemented in various
states during 1995 averaged approximately 10% across the NSA
Group's entire book of business.  The higher rate levels and
competitive pressures in the nonstandard automobile insurance
industry adversely impacted premium growth during 1995.

    Republic Indemnity   The decline in California workers'
compensation premiums reflects the impact of mandatory premium
rate reductions which were phased in over the course of policy
terms during 1994 and 1995, and extremely competitive pricing
in the marketplace as a result of the repeal of the California
workers' compensation minimum rate law effective January 1,
1995.  As a consequence of the repeal of this law, Republic's
rate levels reflect the change in its mix of business toward
non-participating policies which do not require the payment of
policyholder dividends.  Management expects this change toward
non-participating policies to continue.  Despite lower premium
volume, the combined ratio decreased in 1995 as compared to
1994 mainly because of lower policyholder dividends and a
reduction in the amount of policyholder dividends estimated to
be incurred, partially offset by an increase in the frequency
of claims.  Also, the underwriting expense ratio increased for
1995 due primarily to the decline in premiums.



                                 21
<PAGE>
Investment Income  Changes in investment income reflect
fluctuations in market rates and changes in average invested
assets.

    1995 compared to 1994  Excluding interest income of $45
million earned in 1995 on amounts due from affiliates,
investment income decreased $8 million (5%) due to a decrease
in average investments held.

    1994 compared to 1993  Excluding interest income of $25
million on the General Cable notes recorded in 1993,
investment income increased $26 million (18%) in 1994 due
primarily to an increase in average investments held.

Investee Corporations  Equity in net earnings (losses) of
investee corporations (companies in which the Company owns a
significant portion of the voting stock) in 1995 represents
the Company's proportionate share of the losses of Chiquita
Brands.  The Company purchased 3.2 million shares of Chiquita
common stock from AFC during the second quarter of 1995.

Other Income  Other income includes revenues from coal, oil
and gas properties and gains and losses from real estate
sales.

Sales of Other Products and Services  Sales of other products
and services represents the Company's revenues from its non-
insurance businesses, substantially all of which have been
sold.

Interest on Borrowed Money  Changes in interest expense result
from changes in levels of borrowings.  The Company has
generally financed its borrowings on a long-term basis which
has resulted in higher current costs.

    1995 compared to 1994  Interest expense decreased by $8.3
million (16%) due primarily to the Company's repurchase
throughout 1995 of $180 million principal amount of its
Subordinated notes.

    1994 compared to 1993  Interest expense decreased by $9.6
million (15%) due primarily to the Company's repurchase of
$133 million principal amount of its 11% debentures during the
1993 third quarter.

Provision for Asset Impairment  Provision for asset impairment
includes expected losses associated with the intended
divestitures of the Company's non-insurance investments.

Other Operating and General Expenses  Operating and general
expenses included $39.3 million and $98.6 million in 1994 and
1993, respectively, from divested, non-insurance subsidiaries.

Income Taxes  See Note J of Notes to Financial Statements for
an analysis of the Company's deferred tax asset and other
items affecting the Company's effective tax rate.

    The 1994 provision for income tax reflects less than full
realization of the tax benefit attributable to the net
realized capital loss recorded in that period.  The 1993
income tax benefit was attributable to an increase of $132
million in the Company's net deferred tax asset due to
revisions to the estimated future taxable income during the
Company's tax loss carryforward period.





                                 22
<PAGE>
                             ITEM 8
                                
           Financial Statements and Supplementary Data



                                                               Page
Number

Report of Independent Auditors                                  F-1

Report of Prior Years' Independent Auditors                     F-2

American Premier Underwriters, Inc. and Subsidiaries:

     Consolidated Balance Sheet-
       December 31, 1995 and 1994                               F-3

     Consolidated Statement of Earnings-
       For the years ended December 31, 1995, 1994 and 1993     F-4

     Consolidated Statement of Cash Flows-
       For the years ended December 31, 1995, 1994 and 1993     F-5

     Notes to Consolidated Financial Statements                 F-6




"Selected Quarterly Financial Data" has been included in Note O
to the Consolidated Financial Statements.
                                
                                
                                
                                
                                
                             ITEM 9
                                
   Changes in and Disagreements with Accountants on Accounting
                    and Financial Disclosure


     The Company filed a report on Form 8-K on August 29, 1995,
reporting a change in its independent accountants.  The report is
incorporated herein by reference.

















                                23
<PAGE>
                            PART III
                                
                             ITEM 10

       Directors and Executive Officers of the Registrant

   The directors and executive officers of the Company at
March 1, 1996 were as follows:

  Executive                                                     Executive
    Name                 Age            Position                    Since

Carl H. Lindner          76      Chairman of the Board and Chief
                                   Executive Officer                 1982
Carl H. Lindner III      42      President and a Director            1991
S. Craig Lindner         40      Vice Chairman of the Board          1995
Keith E. Lindner         36      Vice Chairman of the Board          1995
Theodore H. Emmerich     69      Director                            1988
James E. Evans           50      Senior Vice President, General
                                   Counsel and a Director            1985
Thomas M. Hunt           72      Director                            1982
William R. Martin        66      Director                            1994
Alfred W. Martinelli     68      Director (resigned March 20, 1996)  1982
Neil M. Hahl             47      Senior Vice President               1982
Thomas E. Mischell       48      Senior Vice President - Taxes       1995
Fred J. Runk             53      Senior Vice President and 
                                   Treasurer                         1995

   Carl H. Lindner has been Chairman of the Board and Chief
Executive Officer of the Company for more than five years.
Mr. Lindner is Chairman of the Board and Chief Executive
Officer of AFG, the Company's parent, and has been Chairman of
the Board and Chief Executive Officer of AFC since it was
founded over 35 years ago.  Mr. Lindner serves as Chairman of
the Board of the following additional companies:  American
Annuity Group, Inc. ("AAG"), American Financial Enterprises,
Inc. ("AFEI"), Chiquita Brands International, Inc.
("Chiquita") and Citicasters Inc. ("Citicasters").  Carl H.
Lindner is the father of Carl H. Lindner III, S. Craig Lindner
and Keith E. Lindner.

   Carl H. Lindner III was elected President of the Company in
February 1992.  He is President and a director of AFG and AFC.
He has also been President of Great American Insurance Company
for more than five years.

   S. Craig Lindner is a Vice Chairman of the Board of the
Company.  He is also a Vice Chairman of AFG and AFC.  He has
been President of AAG since 1993 and President of American
Money Management Corporation ("AMMC"), an AFG subsidiary
providing investment services to the Company and certain of
its affiliates, since January 1996.  He had been Senior
Executive Vice President of AMMC for more than five years.
Mr. Lindner is also a director of AAG and Citicasters.

   Keith E. Lindner is a Vice Chairman of the Board of the
Company.  He is also a Vice Chairman of AFG and AFC.  He has
been President, Chief Operating Officer and a director of
Chiquita for more than five years.

   Theodore H. Emmerich is a retired managing partner of Ernst
& Young LLP, certified public accountants, Cincinnati, Ohio.
He is also a director of AFG, AFC, Citicasters, Carillon Fund,
Inc., Carrillon Investment Trust, Gradison-McDonald Municipal
Custodian Trust, Gradison-McDonald Cash Reserve Trust and
Summit Investment Trust.



                                 24
<PAGE>
   James E. Evans is Senior Vice President, General Counsel
and a director of the Company.  He is also Senior Vice
President, General Counsel and a director of AFG and AFC.  He
has also served as Vice President and General Counsel of AFC
for more than five years.  Mr. Evans is also a director of
AFEI and Citicasters.

   Thomas M. Hunt has been Chairman of the Board of Hunt
Petroleum Corporation, an oil and gas production company, for
more than five years.  He is also a director of AFG and AFC.

   William R. Martin has been Chairman of the Board of MB
Computing, Inc., a computer software and services company, for
more than five years.  He is also a director of AFG, AFC and
AAG.

   Neil M. Hahl has been a Senior Vice President of the
Company for more than five years.  He is also a Senior Vice
President of AFG.

   Thomas E. Mischell is Senior Vice President - Taxes of the
Company.  He is also Senior Vice President - Taxes of AFG.  He
has served as a Vice President of AFC for more than five
years.

   Fred J. Runk is Senior Vice President and Treasurer of the
Company.  He is also Senior Vice President and Treasurer of
AFG.  He has served as Vice President and Treasurer of AFC for
more than five years.

   In December 1993, Great American Communications Company,
which subsequently changed its name to Citicasters Inc.,
completed a comprehensive financial restructuring that
included a prepackaged plan of reorganization filed in
November of that year under Chapter 11 of the Bankruptcy Code.
Carl H. Lindner, Thomas E. Mischell and Fred J. Runk had been
executive officers of that company within two years before its
bankruptcy reorganization.




   The information required by the following Items will be
provided within 120 days after the end of Registrant's fiscal
year.


   ITEM 11   Executive Compensation



   ITEM 12   Security Ownership of Certain Beneficial Owners and
               Management



   ITEM 13   Certain Relationships and Related Transactions












                              25
<PAGE>                 
                 REPORT OF INDEPENDENT AUDITORS


Board of Directors
American Premier Underwriters, Inc.

     We have audited the accompanying consolidated balance sheet
of American Premier Underwriters, Inc. and subsidiaries as of
December 31, 1995 and the related consolidated statements of
earnings and cash flows for the year then ended.  Our audit also
included the financial statement schedules listed in the Index at
Item 14(a).  These financial statements and schedules are the
responsibility of the Company's management.  Our responsibility
is to express an opinion on these financial statements and
schedules based on our audit.

     We conducted our audit in accordance with generally accepted
auditing standards.  Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement.  An
audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements.  An
audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating
the overall financial statement presentation.  We believe that
our audit provides a reasonable basis for our opinion.

     In our opinion, the consolidated financial statements
referred to above present fairly, in all material respects, the
consolidated financial position of American Premier Underwriters,
Inc. and subsidiaries as of December 31, 1995, and the
consolidated results of their operations and their cash flows for
the year then ended, in conformity with generally accepted
accounting principles. Also, in our opinion, the related
financial statement schedules, when considered in relation to the
basic financial statements taken as a whole, present fairly in
all material respects the information set forth therein.




                                    ERNST & YOUNG LLP


Cincinnati, Ohio
March 15, 1996




















                              F-1
 <PAGE>
           REPORT OF PRIOR YEARS' INDEPENDENT AUDITORS



American Premier Underwriters, Inc.

We  have  audited  the  financial statements  and  the  financial
statement  schedules of American Premier Underwriters,  Inc.  and
Consolidated  Subsidiaries  listed  in  the  Index  to  Financial
Statements and Financial Statement Schedules of American  Premier
Underwriters,  Inc.'s Form 10-K for the year ended  December  31,
1994   (not   presented  separately  herein).   These   financial
statements  and  the   financial  statement  schedules  are   the
responsibility  of the Company's management.  Our  responsibility
is  to  express  an  opinion  on  the  financial  statements  and
financial statement schedules based on our audits.

We  conducted  our  audits in accordance with generally  accepted
auditing  standards.  Those standards require that  we  plan  and
perform  the  audit to obtain reasonable assurance about  whether
the  financial statements are free of material misstatement.   An
audit  includes  examining, on a test basis, evidence  supporting
the  amounts  and  disclosures in the financial  statements.   An
audit also includes assessing the accounting principles used  and
significant  estimates made by management, as well as  evaluating
the  overall  financial statement presentation.  We believe  that
our audits provide a reasonable basis for our opinion.

In  our opinion, such financial statements present fairly, in all
material  respects,  the financial position of  American  Premier
Underwriters, Inc. and Consolidated Subsidiaries at December  31,
1994  and  the results of its operations and its cash  flows  for
each  of  the two years in the period ended December 31, 1994  in
conformity with generally accepted accounting principles.   Also,
in   our  opinion,  such  financial  statement  schedules,   when
considered in relation to the basic financial statements taken as
a  whole, present fairly in all material respects the information
shown therein.




DELOITTE & TOUCHE LLP



Cincinnati, Ohio
February 15, 1995
(March 23, 1995 with respect to the
acquisition of American Financial
Corporation as discussed in Note B to
the financial statements)


     
     
     
     
     
     
     
     
     
     
     
     
                              F-2
<PAGE>
      AMERICAN PREMIER UNDERWRITERS, INC. AND SUBSIDIARIES
                   CONSOLIDATED BALANCE SHEET
                          (In Millions)
<TABLE>                                
<CAPTION>
                                                       December 31,
                                                      1995      1994
<S>                                               <C>       <C>     
Assets:
Cash and short-term investments                   $  116.4  $  287.5
Investments:
 Bonds and redeemable preferred stocks:
   Held to maturity - at amortized cost
     (market - $342.7 and $1,441.9)                  332.8   1,520.5
   Available for sale - at market
     (amortized cost - $1,468.5 and $846.8)        1,536.9     819.4
 Other stocks - principally at market
    (cost $4.2 and $6.4)                               3.7       5.2
 Investment in investee                               41.0        -
 Loans receivable                                     39.8      76.7
 Real estate and other investments                    20.4      41.3
                                                   1,974.6   2,463.1

Accrued investment income                             33.8      46.6
Agents' balances and premiums receivable             326.9     343.8
Amounts due from affiliates, net                     554.4        -
Recoverables from reinsurers and prepaid
  reinsurance premiums                                65.3      53.2
Other receivables                                     38.0      44.5
Deferred policy acquisition costs                     89.6      92.1
Cost in excess of net assets acquired                389.9     394.5
Deferred tax asset                                   200.4     267.7
Other assets                                         165.9     204.4

                                                  $3,955.2  $4,197.4


Liabilities and Capital:
Unpaid losses and loss adjustment expenses        $1,194.9  $1,130.9
Unearned premiums                                    437.0     440.2
Policyholder dividends                                52.5     102.4
Long-term debt:
  Parent Company                                     320.6     500.0
  Subsidiaries                                         9.1       9.8
Minority interest                                       -        6.2
Accounts payable and other liabilities               389.2     459.2
                                                   2,403.3   2,648.7

Common Stock, $1 par value - outstanding
  47,000,000 and 46,282,157 shares                    47.0      46.3
Capital surplus                                      579.1     662.2
Retained earnings                                    881.8     867.5
Net unrealized gains (losses) on marketable
  securities                                          44.0     (27.3)
    Total common shareholder's equity              1,551.9   1,548.7

                                                  $3,955.2  $4,197.4
</TABLE>

         See notes to consolidated financial statements.
                                
                              F-3
<PAGE>
      AMERICAN PREMIER UNDERWRITERS, INC. AND SUBSIDIARIES
               CONSOLIDATED STATEMENT OF EARNINGS
                          (In Millions)
<TABLE>
<CAPTION>
                                                                Year ended December 31,
                                                              1995       1994       1993
<S>                                                       <C>         <C>       <C>
Income:
   Property and casualty insurance premiums earned        $1,495.4   $1,557.9   $1,273.6
   Net investment income                                     205.4      168.3      168.1
   Realized gains on sales of securities                      23.8         .1      123.3
   Equity in net earnings (losses) of investee                (2.2)        -          -
   Sales of other products and services                         -        94.8      179.0
   Losses on sales of subsidiaries                             (.3)      (4.0)     (22.0)
 Loss on sale of General Cable securities                       -       (75.8)        - 
 Other income                                                 13.4       17.6       14.3
                                                           1,735.5    1,758.9    1,736.3

Costs and Expenses:
 Property and casualty insurance operations:
     Losses                                                1,038.9      939.3      726.9
     Loss adjustment expenses                                159.5      151.4      130.0
     Commissions and other underwriting  expenses            331.1      344.8      275.3
     Policyholder dividends                                   (5.0)      75.7       93.2
     Cost of sales                                              -        60.0       80.6
   Interest charges on borrowed money                         44.9       53.2       62.8
   Provision for asset impairment                               -          -        19.6
   Other operating and general expenses                       53.1       93.3      157.8
                                                           1,622.5    1,717.7    1,546.2

Earnings before income taxes                                 113.0       41.2      190.1
Income tax (expense) benefit                                 (45.9)     (40.4)      52.6

Net earnings from continuing operations                       67.1         .8      242.7


Discontinued operations:
   Income from discontinued operations                          -          -         2.8
   Loss on disposal                                             -         (.5)     (13.5)
Extraordinary loss, net of tax benefit                        (5.1)        -          -    

Net  earnings                                            $    62.0   $     .3   $  232.0
</TABLE>
                                
         See notes to consolidated financial statements.
                                
                                
                                
                              F-4
<PAGE>             
             AMERICAN PREMIER UNDERWRITERS, INC. AND SUBSIDIARIES
                     CONSOLIDATED STATEMENT OF CASH FLOWS
                                 (In Millions)
<TABLE>                                       
<CAPTION>
                                                        Year ended December 31,
                                                        1995         1994       1993
<S>                                                    <C>       <C>         <C>
Operating Activities:                               
  Income from continuing operations                    $   67.1  $     .8   $  242.7
  Adjustments:
   Deferred Federal income tax                             46.0      36.3      (57.9)
   Depreciation, depletion and amortization                26.9      27.5       32.8
   Equity in net losses of investee                         2.2        -          -
   Realized (gains) losses on investing activities        (25.5)     76.9      (80.6)
   Increase in receivables                                 (4.9)    (54.8)     (96.9)
   (Increase) decrease  in  other  assets                   (4.5)    (5.4)       6.7
   Increase (decrease)  in  other  liabilities             (24.9)    (7.0)      12.7
   Increase in unpaid losses and loss adjustment expenses   64.6    155.2       94.8
   Increase  (decrease)  in  policyholder  dividends       (49.9)    (9.4)      30.4
   Increase  (decrease)  in  unearned  premiums             (1.9)    82.1      105.7
   Litigation settlement                                      -        -        15.6
   Dividends from investee                                    .5       -          -
   Other, net                                                6.3      5.4       (1.9)
                                                           102.0    307.6      304.1

Investing Activities:
  Purchases of and additional investments in:
     Fixed maturity investments                           (514.9)  (846.3)    (734.5)
     Equity securities                                       (.7)    (1.9)      (1.0)
     Affiliates and subsidiaries                           (57.1)   (13.9)     (95.3)
     Property and equipment                                (13.8)   (22.1)     (17.5)
  Maturities and redemptions of fixed maturity 
    investments                                            272.3    159.8      382.2
 Sales of:
     Fixed   maturity  investments                         851.0     70.9      128.7
   General Cable Corporation securities                       -     176.7         -
   Equity securities                                         2.8       .7      178.5
   Affiliates and subsidiaries                              20.4     31.6       89.7
   Real estate, property and equipment                      23.0      1.7         .8
  Cash and short-term investments of new  subsidiaries        -       5.0       15.3
 Decrease in other investments                              11.1     23.9       76.2
                                                           594.1   (413.9)      23.1

Financing Activities:
 Reductions  of  debt                                     (186.8)   (17.5)    (135.1)
 Issuance of debt                                             -       1.2        1.8
 Common  Stock  dividends  paid                            (57.3)   (40.6)     (38.2)
 Exercise of stock options and conversion of Career Shares    .5     19.1       24.0
  Purchases of Company Common Stock                        (87.6)   (47.7)      (1.9)
 Net advances to affiliates                               (536.0)      -          -
 Other, net                                                   -       2.1       (1.0)
                                                          (867.2)   (83.4)    (150.4)

Net  cash  flows  from  continuing  operations            (171.1)  (189.7)     176.8
Net cash from discontinued operations                         -        -         8.3

Net Increase (Decrease) in Cash and Short-term Investments(171.1)  (189.7)     185.1
Cash and short-term investments at beginning of period     287.5    477.2      292.1

Cash and short-term investments at end of period        $  116.4 $  287.5   $  477.2
</TABLE>

See notes to consolidated financial statements.
                                   F-5
<PAGE>
      AMERICAN PREMIER UNDERWRITERS, INC. AND SUBSIDIARIES
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                


                         INDEX TO NOTES

  A. Accounting Policies             I. Capital Stock
  B. Mergers                         J. Income Taxes
  C. Divestitures                    K. Contingencies
  D. Investments                     L. Insurance Operations
  E. Amounts Due from Affiliates     M. Statement of Cash Flows
  F. Cost in Excess of Net Assets    N. Transactions With Affiliates
       Acquired                      O. Quarterly Operating Results
  G. Long-Term Debt                  P. Other Information
  H. Benefit Plans                   Q. Subsequent Event



A.  Accounting Policies

Basis of Presentation   The consolidated financial statements
include the accounts of the Company and its subsidiaries, with
the exception of the Company's defense services operations sold
in 1993 which have been classified as discontinued operations.
The Company's only industry segment is specialty property and
casualty insurance, the operations of which are located primarily
within the United States.  Certain reclassifications have been
made to prior years to conform to the current year's
presentation.  All significant intercompany balances and
transactions have been eliminated.  All acquisitions have been
treated as purchases.  The results of operations of companies
since their formation or acquisition are included in the
consolidated financial statements.

The preparation of the financial statements in conformity with
generally accepted accounting principles requires management to
make estimates and assumptions that affect the amounts reported
in the financial statements and accompanying notes.  Changes in
circumstances could cause actual results to differ materially
from those estimates.

Investments    Debt securities are classified as "held to
maturity" and reported at amortized cost if the Company has the
positive intent and ability to hold them to maturity.  Debt and
equity securities are classified as "available for sale" and
reported at fair value with unrealized gains and losses reported
as a separate component of shareholders' equity if the debt or
equity securities are not classified as held to maturity or
bought and held principally for selling in the near term.  Only
in certain limited circumstances, such as significant issuer
credit deterioration or if required by insurance or other
regulators, may a company change its intent to hold a certain
security to maturity without calling into question its intent to
hold other debt securities to maturity in the future.

In accordance with guidance issued by the Financial Accounting
Standards Board in November 1995, the Company reassessed the
classifications of its investments and transferred fixed maturity
securities with an amortized cost of approximately $839 million
to "available for sale."  This "one-time" reclassification
resulted in an increase of $43 million in carrying value of fixed
maturity investments and an increase of $28 million in
shareholders' equity.  The transfer had no effect on net
earnings.





                              F-6
<PAGE>      
      AMERICAN PREMIER UNDERWRITERS, INC. AND SUBSIDIARIES
     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


Premiums and discounts on mortgage-backed securities are
amortized over their expected average lives using the interest
method.  Gains or losses on sales of securities are recognized at
the time of disposition with the amount of gain or loss
determined on the specific identification basis.  When a decline
in the value of a specific investment is considered to be other
than temporary, a provision for impairment is charged to earnings
and the carrying value of that investment is reduced.

The Company's investments in equity securities of companies that
are 20% to 50% owned by AFG and its subsidiaries are carried at
cost, adjusted for a proportionate share of their undistributed
earnings or losses.

Short-term investments are carried at cost; loans receivable are
stated primarily at the aggregate unpaid balance.

Cost in Excess of Net Assets Acquired   The excess of cost of
subsidiaries over the Company's equity in the underlying net
assets ("goodwill") is being amortized over 40 years.

The Company's management continually monitors whether significant
changes in certain industry and regulatory conditions or
prolonged trends of declining profitability have occurred which
would lead the Company to question the recoverability of the
carrying value of its goodwill. The Company's evaluation of its
recorded goodwill would be based primarily on estimates of future
earnings, as well as all other available factors which may
provide additional evidence relevant to the assessment of
recoverability of its goodwill.

Insurance   As discussed under "Reinsurance" below, unpaid losses
and loss adjustment expenses and unearned premiums have not been
reduced for reinsurance receivable.

Reinsurance  In the normal course of business, the Company's
insurance subsidiaries cede reinsurance to other companies to
diversify risk and limit maximum loss arising from large
claims.  To the extent that any reinsuring companies are unable
to meet obligations under the agreements covering reinsurance
ceded, the Company's insurance subsidiaries would remain
liable.  Amounts recoverable from reinsurers are estimated in a
manner consistent with the claim liability associated with the
reinsurance policies.  The Company's insurance subsidiaries
report as assets (a) the estimated reinsurance recoverable on
unpaid losses, including an estimate for losses incurred but
not reported, and (b) amounts paid to reinsurers applicable to
the unexpired terms of policies in force.  The Company's
insurance subsidiaries also assume reinsurance from other
companies.  Income on reinsurance assumed is recognized based
on reports received from ceding reinsurers.

Deferred Policy Acquisition Costs  Policy acquisition costs
(principally commissions, premium taxes and other underwriting
expenses) related to the production of new business are
deferred.  The deferral of acquisition costs is limited based
upon their recoverability without any consideration for
anticipated investment income.  Deferred policy acquisition
costs are charged against income ratably over the terms of the
related policies.

Unpaid Losses and Loss Adjustment Expenses  The net liabilities
stated for unpaid claims and for expenses of investigation and
adjustment of unpaid claims are based upon (a) the accumulation
of case estimates for losses reported prior to the close of the
accounting period on the direct business



                              F-7
<PAGE>      
      AMERICAN PREMIER UNDERWRITERS, INC. AND SUBSIDIARIES
     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


written; (b) estimates received from ceding reinsurers and
insurance pools and associations; (c) estimates of unreported
losses based on past experience and (d) estimates based on
experience of expenses for investigating and adjusting claims.
These liabilities are subject to the impact of changes in claim
amounts and frequency and other factors.  In spite of the
variability inherent in such estimates, management believes that
the liabilities for unpaid losses and loss adjustment expenses
are adequate.  Changes in estimates of the liabilities for losses
and loss adjustment expenses are reflected in the Statement of
Earnings in the period in which determined.

Premium Recognition  Premiums are earned over the terms of the
policies on a pro rata basis.  Unearned premiums represent that
portion of premiums written which is applicable to the unexpired
terms of policies in force.  On reinsurance assumed from other
insurance companies or written through various underwriting
organizations, unearned premiums are based on reports received
from such companies and organizations.

Policyholder Dividends   Dividends payable to policyholders
represent management's estimate of amounts payable on
participating policies which share in favorable underwriting
results.  The estimate is accrued during the period in which the
related premium is earned.  Changes in estimates are included in
the Statement of Earnings in the period determined.  Policyholder
dividends do not become legal liabilities unless and until
declared by the boards of directors of the insurance companies.

Capital Surplus   Adjustments to claims and contingencies arising
from events or circumstances preceding the Company's 1978
reorganization are reflected in capital surplus if the
adjustments are not clearly attributable to post-reorganization
events or circumstances.  Such pre-reorganization claims and
contingencies consist principally of personal injury claims by
former employees of the Company's predecessor and claims relating
to the generation, disposal or release into the environment of
allegedly hazardous substances arising out of railroad operations
disposed of prior to the 1978 reorganization.

Fair Value of Financial Instruments   Methods and assumptions
used in estimating fair values are described in Note P.  These
fair values represent point-in-time estimates of value that might
not be particularly relevant in predicting the Company's future
earnings or cash flows.

Statement of Cash Flows   For cash flow purposes, "investing
activities" are defined as making and collecting loans and
acquiring and disposing of debt or equity instruments and
property and equipment.  "Financing activities" include obtaining
resources from owners and providing them with a return on their
investments, borrowing money and repaying amounts borrowed.  All
other activities are considered "operating".  Short-term
investments having original maturities of three months or less
when purchased are considered to be cash equivalents for purposes
of the financial statements.

B.   Mergers

In April 1995, the Company became a wholly-owned subsidiary of
American Premier Group, Inc., a new corporation formed by the
Company for the purpose of acquiring all of the common stock of
the Company and American Financial Corporation (the "Mergers").
In June 1995, American Premier Group changed its name to American
Financial Group, Inc. ("AFG").  Under terms of the Mergers, (a)
the Company merged with a subsidiary of AFG and each share


                              F-8
<PAGE>      
      AMERICAN PREMIER UNDERWRITERS, INC. AND SUBSIDIARIES
     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


of Company Common Stock then outstanding was converted into one
share of AFG Common Stock, and (b) American Financial Corporation
("AFC") merged with another subsidiary of AFG and all shares of
AFC common stock were exchanged for 28.3 million shares of AFG
Common Stock.  As a result of the Mergers, all of the common
stock of the Company and AFC is owned by AFG and AFG is the
Company's successor as the issuer of publicly held common stock.

In connection with the Mergers, AFG reviewed the classification
of all securities held by its subsidiaries.  As a result, all
securities held by the Parent Company and 44% of those held by
the Company's insurance subsidiaries at the date of the Mergers
were classified as "available for sale."  These classifications
reflect transfers from "held to maturity" of $273 million for the
Parent Company and $274 million for the Insurance companies.  The
cost of securities transferred approximated market value.

C.  Divestitures

Sale of Non-insurance Businesses   The intended divestitures of
businesses announced in December 1992 included five small
diversified industrial companies, four of which were sold during
1993 and 1994 for aggregate proceeds of $30.9 million.  The
remaining business was sold in February 1995 for cash and notes
of approximately $13 million, net of expenses and post-closing
adjustments.  A provision of $4.0 million for the anticipated
loss on this sale was recorded in 1994.

In 1994, the Company sold its 53.5% interest in operations which
provided onshore oil and gas contract drilling and well workover
services for $14.5 million in cash.  No gain or loss was
recognized on the transaction.

In 1993, the Company sold its investment in Tejas Gas Corporation
("Tejas") in an underwritten public offering for net proceeds of
$106.6 million.  The Company's pretax gain from the sale was
approximately $80.0 million.

In 1993, the Company sold its limited partnership interest in
Buckeye Partners, L.P. ("Buckeye Units") in an underwritten
public offering for net proceeds of $71.6 million.  The Company's
pretax gain from the sale was approximately $18.5 million.

Sale of General Cable Corporation Securities   As part of the
1992 spin-off of General Cable Corporation, the Company retained
a $255 million 9.98% subordinated note due 2007 issued by General
Cable (the "General Cable Note") and approximately 11.6% of the
General Cable shares ("Retained Shares").  During 1993, General
Cable paid the $31.8 million of interest due on the General Cable
Note with additional 9.98% subordinated notes ("Interest Notes")
in lieu of cash.

In February 1994, as a result of General Cable's sale of its
Marathon LeTourneau unit to a subsidiary of Rowan Companies, Inc.
("Rowan"), General Cable delivered to the Company cash and
promissory notes issued by Rowan totalling $52.1 million as a
partial payment of the General Cable Note and Interest Notes
(collectively, the "General Cable Notes").  As a result of these
receipts, the Company credited General Cable with $48.1 million
of principal and interest on the General Cable Notes.







                              F-9
<PAGE>      
      AMERICAN PREMIER UNDERWRITERS, INC. AND SUBSIDIARIES
     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


In June 1994, as part of an agreement for the purchase of all of
the outstanding shares of General Cable by Wassall PLC
("Wassall"), the Company sold to Wassall the then outstanding
$253.5 million principal amount of the General Cable Notes and
the Retained Shares for $169.8 million and $6.9 million,
respectively.  The Company recorded a loss of approximately $75.8
million in 1994 on the disposition, and the Company did not
accrue any interest income on the General Cable Notes during
1994.  Also as part of the agreement, the Company received a
$19.2 million payment from Wassall in consideration of assuming
responsibility for certain actual and potential environmental and
other liabilities.  Immediately prior to the sale of General
Cable, AFC, which at that time owned 40.5% of the Company's
common stock, also owned 45.6% of the outstanding common stock of
General Cable.  The Chairman of the Board and Chief Executive
Officer of the Company was the Chairman of the Board of General
Cable.

Discontinued Operations   In 1993, the Company sold its defense
services operations to an unaffiliated company and recognized a
loss of approximately $13.5 million from the sale.  Revenues,
pretax income and net income of discontinued operations for 1993
amounted to $275 million, $4.8 million and $2.8 million,
respectively.

D.  Investments     Bonds, redeemable preferred stocks and other
stocks at
    December 31, consisted of the following (in millions):
<TABLE>
<CAPTION>
                                                         1995
                                                   Held to Maturity
                                     Amortized      Market     Gross Unrealized
                                          Cost       Value     Gains     Losses
   <S>                               <C>          <C>          <C>        <C>
   Bonds and redeemable
    preferred stocks:
     United States Government
       and government agencies
       and authorities               $     -      $     -       $  -       $  -
       States, municipalities and
       political subdivisions             8.4          9.0         .6         -
     Foreign securities                  13.7         14.1         .4         -
     Public utilities                    18.8         19.1         .3         -
     Mortgage-backed securities          80.8         82.9        2.1         -
     All other corporate                210.1        216.5        6.6         .2
     Redeemable preferred stocks          1.0          1.1         .1         -
                                     $  332.8     $  342.7      $10.1      $  .2


                                                        1995
                                                 Available for Sale
                                    Amortized       Market      Gross Unrealized
                                         Cost        Value      Gains     Losses
   Bonds and redeemable
    preferred stocks:
     United States Government
       and government agencies
       and authorities               $   83.0     $   86.5      $ 3.6      $  .1
     States, municipalities and
       political subdivisions             2.3          2.6         .3         -
     Foreign securities                  77.4         79.0        1.8         .2
     Public utilities                   224.9        233.7        9.7         .9
     Mortgage-backed securities          96.9        100.4        3.6         .1
     All other corporate                978.8      1,029.5       55.4        4.7
     Redeemable preferred stocks          5.2          5.2         .1         .1
                                     $1,468.5     $1,536.9      $74.5      $ 6.1

   Other stocks                      $    4.2     $    3.7      $  -       $  .5

                                                         1994
                                                   Held to Maturity
                                    Amortized       Market      Gross Unrealized
                                         Cost        Value      Gains     Losses
   Bonds and redeemable
    preferred stocks:
     United States Government
      and government agencies
      and authorities                $   50.5     $   49.9      $  -      $  .6
     States, municipalities and
      political subdivisions              8.0          8.5        .5         -
     Foreign securities                   8.6          7.7         -         .9
     Public utilities                   230.5        215.1         .3      15.7
     Mortgage-backed securities          81.3         77.4         .2       4.1
     All other corporate              1,138.7      1,080.4        2.8      61.1
     Redeemable preferred stocks          2.9          2.9         -         -

                                     $1,520.5     $1,441.9      $ 3.8     $82.4
                                     
                                                       1994
                                                Available for Sale
                                    Amortized       Market     Gross Unrealized
                                         Cost        Value      Gains    Losses
   Bonds and redeemable
    preferred stocks:
     United States Government
      and government agencies
      and authorities                  $409.7     $  402.2      $  .2     $ 7.7
     States, municipalities and
      political subdivisions              2.8          2.8         -         -
     Foreign securities                  52.6         51.0         -        1.6
     Public utilities                    16.8         15.7         -        1.1
     Mortgage-backed securities          57.9         54.9         .1       3.1
     All other corporate                303.2        289.1        1.5      15.6
     Redeemable preferred stocks          3.8          3.7         .1        .2

                                       $846.8    $  819.4       $ 1.9     $29.3

   Other stocks                        $  6.4    $    5.2       $  -      $ 1.2
</TABLE>





                              F-10
<PAGE>      
      AMERICAN PREMIER UNDERWRITERS, INC. AND SUBSIDIARIES
     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


The table below sets forth the scheduled maturities of bonds and
redeemable preferred stocks based on carrying value as of
December 31, 1995.  Data based on market value is generally the
same.  Mortgage-backed securities had an average life of
approximately 4 years at December 31, 1995.

                                            Held to  Available
           Maturity                        Maturity   for Sale
         One year or less                       9%         3%
         After one year through five years     28         26
         After five years through ten years    34         51
         After ten years                        5         13
                                               76         93
         Mortgage-backed securities            24          7
                                              100%       100%

Realized gains (losses) and changes in unrealized appreciation
(depreciation) on fixed maturity and equity security investments
are summarized as follows (in millions):

                        Fixed      Equity       Tax
                   Maturities  Securities   Effects         Total
1995
Realized             $   23.8      $   -     $ (9.1)       $ 14.7
Change in Unrealized    184.3          .7     (27.2)        157.8

1994
Realized                   .1          -         -             .1
Change in Unrealized   (192.9)       (1.1)     30.4        (163.6)

1993
Realized                 14.7       108.6     (57.5)         65.8
Change in Unrealized     42.3         (.2)    (14.7)         27.4

Transactions in fixed maturity investments included in the
Statement of Cash Flows for 1995 consisted of the following (in millions):

                                              1995
                                Held to     Available
                               Maturity      for Sale     Total

   Purchases                    $196.0         $318.9    $514.9
   Maturities and redemptions    232.9           39.4     272.3
   Sales                            -           851.0     851.0
   Gross Gains                     4.8           25.2      30.0
   Gross Losses                   (1.9)          (4.3)     (6.2)

                                              1994
                               Held to      Available
                              Maturity       for Sale     Total

   Purchases                    $337.5         $508.8    $846.3
   Maturities and redemptions    144.0           15.8     159.8
   Sales                           5.9           65.0      70.9
   Gross Gains                      .2            3.2       3.4
   Gross Losses                    (.1)          (3.2)     (3.3)


Securities classified as "held to maturity" having an amortized
cost of $5.8 million were sold for a gain of $.1 million in 1994,
due to significant deterioration in the issuers'
creditworthiness.

Gross gains of $15.6 million and gross losses of $.9 million were
realized on sales of fixed maturity investments in 1993.

   
   
   
   
   
   
   
   
   
                              F-11
<PAGE>
      AMERICAN PREMIER UNDERWRITERS, INC. AND SUBSIDIARIES
     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


Major categories of net investment income were as follows (in
millions):

                                   1995      1994      1993

     Fixed maturities            $164.2    $171.1    $138.8
     Loans to affiliates           44.0        -         -
     Equities                        .2        .1       4.3
     Other                           -         .4      28.6
       Total investment income    208.4     171.6     171.7
     Investment expenses           (3.0)     (3.3)     (3.6)
       Net investment income     $205.4    $168.3    $168.1

The Company's investment in investee corporation reflects the
Company's 6% ownership (3.2 million shares) of the common stock
of Chiquita Brands International, Inc. ("Chiquita") which is
accounted for under the equity method.  AFG and its other
subsidiaries own an additional 38% of the common stock of
Chiquita.  Chiquita is a leading international marketer,
processor and producer of quality food products.  The market
value of the Company's investment in Chiquita was approximately
$44.5 million at December 31, 1995.

E.   Amounts Due from Affiliates

Subsequent to the Mergers, the Company entered into a credit
agreement under which loans are available to AFC of up to $675
million (the "AFC Credit Agreement").  The credit line bears
interest at 11-5/8% and converts to a four-year term loan in
March 2005 with scheduled principal payments to begin in April
2005.  At December 31, 1995, amounts outstanding under the AFC
Credit Agreement totalled $623.2 million, plus $16.3 million of
accrued interest.

Also subsequent to the Mergers, the Company entered into a credit
agreement with AFG under which the Company and AFG will make
loans of up to $125 million available to each other (the "AFG
Credit Agreement").  The balance outstanding under the credit
line bears interest at a variable rate of one percent over LIBOR
and is payable on December 31, 2010.  At December 31, 1995,
amounts payable to AFG under the AFG Credit Agreement totalled
$84.0 million, plus $1.1 million of accrued interest.

F.   Cost in Excess of Net Assets Acquired   At December 31, 1995 and
1994, accumulated amortization of the excess of cost over net assets 
of purchased subsidiaries amounted to approximately $63 million and 
$53 million, respectively.  Amortization expense was $11.8 million in
1995, $11.4 million in 1994 and $10.5 million in 1993.

G.   Long-Term Debt

Long-term debt consisted of the following at December 31, (in
millions):

                                                 1995      1994
     Parent Company:
      Subordinated notes, 10 7/8%, due 2011      $ 50.5    $150.0
      Subordinated notes, 10 5/8%, due 2000       113.0     150.0
      Subordinated notes,  9 3/4%, due 1999       157.1     200.0
                                                  320.6     500.0
     Subsidiaries:
      Other                                         9.1       9.8
         Total                                   $329.7    $509.8





                              F-12
<PAGE>
      AMERICAN PREMIER UNDERWRITERS, INC. AND SUBSIDIARIES
     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


In December 1995, Pennsylvania Company ("Pennco"), a wholly-owned
subsidiary of the Company, entered into a new collateralized five-
year reducing revolving credit agreement with several banks,
under which it can borrow up to $75 million.  Borrowings bear
interest at floating rates based on prime or LIBOR and are
collateralized by certain stock of an operating subsidiary.  At
December 31, 1995, the Company had no outstanding borrowings
under the agreement.

In May 1995, rating agencies downgraded the Company's
subordinated notes (the "Notes").  As a result of the Mergers and
the subsequent ratings downgrade, the holders of the Notes had
the right to require the Company to purchase all or any portion
of the Notes on August 10, 1995 at par plus accrued interest (the
"Put Right").  The Put Right was exercised for approximately $40
million of the 9-3/4% Notes and approximately $4 million of the
other two issues.

In addition, during 1995, the Company repurchased $2.9 million of
its 9-3/4% subordinated notes, $34.8 million of its 10-5/8%
subordinated notes and $98.3 million of its 10-7/8% subordinated
notes for approximately $142.7 million which resulted in an
extraordinary loss of $5.1 million.  During the first two months
of 1996, the Company repurchased an additional $19.0 million of
its 9-3/4% subordinated notes, $7.5 million of its 10-5/8%
subordinated notes and $2.2 million of its 10-7/8% subordinated
notes.

In March 1994, the Company redeemed all $16.2 million principal
amount of its 9 1/2% subordinated debentures due August 2002 at
the redemption price of 100% of principal.

At December 31, 1995, scheduled principal payments on debt for
the subsequent five years were as follows 1996--$.8 million, 1997-
-$.8 million, 1998--$.9 million, 1999--$157.5 million and 2000--
$114.5 million.

At December 31, 1995, the Company had outstanding letter of
credit facilities totaling $38.6 million which, if drawn, will
bear interest at rates which approximate the prime rates offered
by various banks.

Cash interest payments of $48.7 million, $52.7 million and $62.7
million were made on debt in 1995, 1994 and 1993, respectively.

H.   Benefit Plans

The Company provides retirement benefits, primarily through
contributory and noncontributory defined contribution plans, for
the majority of its regular full-time employees.  Company
contributions under the defined contribution plans approximate,
on average, 4% of each eligible employee's covered compensation.
In addition, the Company sponsors employee savings plans under
which the Company matches a specified portion of contributions
made by eligible employees.  Expense related to defined
contribution plans for 1995, 1994 and 1993 totaled $5.6 million,
$5.8 million and $5.5 million, respectively.

The Company also provides defined benefit pension plan retirement
benefits for certain employees.  The related amounts included in
the accompanying financial statements are not material to the
Company's financial condition.

Under the Company's Stock Option Plan, options to purchase shares
of Common Stock were granted to certain officers and other key
employees, and to non-employee directors of the Company.  Under
the now terminated Career Share



                                 F-13
<PAGE>      
      AMERICAN PREMIER UNDERWRITERS, INC. AND SUBSIDIARIES
     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

Purchase Plan (the "Career Share Plan"), officers and other key
employees of the Company purchased shares of the Company's
Preference Stock (designated Career Shares) which were
convertible, at the holder's option, into a specified number of
shares of Common Stock.  The Company's Employee Stock Purchase
Plan ("ESPP") provided eligible employees with the opportunity to
purchase from the Company, through regular payroll deductions,
shares of the Company's Common Stock at 85% of its fair market value 
on the purchase date.  In connection with the Mergers described in Note
B, each outstanding Career Share was converted into a share of
AFG convertible preferred stock and each stock option outstanding
under the Company's Stock Option Plan was converted into an
option to purchase AFG common stock.  In addition, AFG succeeded
the Company under all provisions of the Stock Option Plan, the
Career Share Plan and the ESPP.

I.   Capital Stock   The Company is authorized to issue 200,000,000
shares of Common Stock.  At December 31, 1995, there were
47,000,000 shares of Common Stock outstanding, all of which were
owned by AFG.  A progression of the Company's shareholder's
equity is as follows (dollars in millions):
<TABLE>
<CAPTION>
                                                                              Unrealized
                                                     Common Stock              Gains(Losses)
                                            Common    and Capital    Retained  on Marketable
                                            Shares        Surplus    Earnings     Securities
<S>                                     <C>               <C>         <C>            <C>
Balance, December 31, 1992              46,382,170         $785.3      $707.0        $ 10.5

  Net earnings                                -                -        232.0            -
  Dividends declared on Common Stock          -                -        (40.0)           -
  Exercise of stock options and
   conversion of Career Shares           1,072,397           22.9          -             -
  Purchases of Company Common Stock        (45,522)          (1.3)         -             -
  Issuance of Common Stock under ESPP       37,049            1.1          -             -
  Adjustment of estimated net pre-
   reorganization liabilities                 -             (14.0)         -             -
  Adjustment to the distribution of
   equity to shareholders from
   spin-off of General Cable                  -                -         13.3            -
  Change in net unrealized gains
   (losses) on investments                    -                -           -            5.9
  Other, net                                  -               (.4)         -             -
Balance, December 31, 1993              47,446,094         $793.6      $912.3        $ 16.4

  Net earnings                                -                -           .3            -
  Dividends declared on Common Stock          -                -        (42.9)           -
  Exercise of stock options and
   conversion of Career Shares             892,968           18.4          -             -
  Purchases of Company Common Stock     (2,099,600)         (52.5)         -             -
  Issuance of Common Stock under
   ESPP and employee stock bonus            42,695            1.1          -             -
  Adjustment of estimated net pre-
   reorganization liabilities                 -             (52.0)         -             -
  Adjustment to the distribution of
   equity to shareholders from
   spin-off of General Cable                  -                -         (2.2)           -
  Change in net unrealized gains
   (losses) on investments                    -                -           -          (43.7)
  Other, net                                  -               (.1)         -             -
Balance, December 31, 1994              46,282,157         $708.5      $867.5        $(27.3)

  Net earnings                                -                -         62.0            -
  Dividends declared on Common Stock          -                -        (10.8)           -
  Purchases of Company Common Stock     (3,259,697)         (82.8)         -             -
  Exercise of stock options                 16,582             .3          -             -
  Issuance of Common Stock under ESPP        4,239             .1          -             -
  Change in net unrealized gains
   (losses) on investments                    -                -           -           71.3
  Conversion of shares to shares of
   American Financial Group, Inc.      (43,043,281)            -           -             -
  Post-Mergers shares outstanding       47,000,000             -           -             -
  Dividends to American
   Financial Group, Inc.                      -                -        (36.9)           -
Balance, December 31, 1995              47,000,000         $626.1      $881.8        $ 44.0
</TABLE>

                                   F-14
<PAGE>      
      AMERICAN PREMIER UNDERWRITERS, INC. AND SUBSIDIARIES
     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


During 1994, the Company increased its accruals for its net
probable liability for claims and contingencies arising from
events and circumstances preceding the Company's 1978
reorganization based on information which became available to it
in 1994.  The accrual includes the estimated costs to the Company
related to remediation of environmental conditions allegedly
caused or contributed to by PCTC and pending and expected claims
by former PCTC employees of injury or disease allegedly caused by
exposure to excessive noise or asbestos in the railroad
workplace.  The foregoing estimates were based on information
available to the Company at that time and are subject to future
change as additional information becomes available.  Offsetting
the increase in these accruals was a $13.8 million credit resulting 
from a judgment in favor of the Company.  In accordance with the Company's
reorganization accounting policy, the Company recorded a net
charge of $52.0 million to capital surplus to reflect the net
effect of the foregoing accruals which the Company believes will
be adequate based on information currently available to it.

Also during 1994, the Company settled a dispute with former
employees of a business that had been acquired in 1990 and
subsequently included in the General Cable Spin-off in July 1992.

During 1993, the Company settled a lawsuit it had brought against
the former owner of a business that was acquired by the Company
in 1990 and was included in the General Cable businesses spun-off
to shareholders in July 1992.  After the spin-off of General
Cable, the Company retained the right to receive any amounts
recovered in the lawsuit.  The net amount of cash received by the
Company in the settlement was accounted for as an adjustment to
the distribution of equity to shareholders resulting from the
spin-off of General Cable.

J.   Income Taxes   The Company files a consolidated income tax return
which includes all 80%-owned U.S. subsidiaries and the AFG parent
company.

For income tax purposes, the Company had the following
carryforwards available at December 31, 1995 (in millions):

                                    Expiring  Amount

     Operating loss                     1996    $476
     Capital loss                  1997-1999     311
     Other - tax credits                          23


The total income tax (provision) credit consists of (in
millions):

                                      1995      1994      1993
     Current
      Federal                        $ (.5)    $(2.8)    $(4.4)
      Foreign                           .6      (1.3)      (.1)
      State & Local                     -         -        (.8)

     Deferred
      Federal                        (46.0)    (36.3)     59.4
      Foreign                           -         -         -
      State & Local                     -         -       (1.5)
                                    ($45.9)   ($40.4)    $52.6




                              F-15
 <PAGE>
      AMERICAN PREMIER UNDERWRITERS, INC. AND SUBSIDIARIES
     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


The following is a reconciliation of income taxes at the
statutory rate of 35% and income taxes as shown in the Statement
of Earnings (in millions):

                                                1995     1994    1993

     Earnings before income taxes
       and extraordinary items                $113.0   $ 41.2   $190.1
     Extraordinary items before income taxes    (7.8)      -        -
     Adjusted earnings before income taxes    $105.2   $ 41.2   $190.1

     Income taxes at statutory rate          ($ 36.8) ($ 14.4) ($ 66.5)

     Effect of:
       Amortization of goodwill                 (4.0)    (4.0)   (3.8)
       Revision to valuation allowance            -        -    132.0
       Loss disallowance                          -     (21.4)   (6.9)
       Other, net                               (2.4)     (.6)   (2.2)
     Total provision                           (43.2)   (40.4)   52.6

     Amounts applicable to extraordinary items  (2.7)      -       -
     Provision for income taxes as shown
       on the Statement of Earnings          ($ 45.9) ($ 40.4) $ 52.6



Earnings before income taxes consisted of the following (in
millions):

                                               1995     1994    1993

     Subject to tax in:
       United States                         $114.8  $ 38.9   $190.1
       Foreign jurisdictions                   (1.8)    2.3       -
                                             $113.0  $ 41.2   $190.1

The Company's substantial tax loss carryforwards and temporary
differences give rise to deferred tax assets.  Based on an
analysis of the likelihood of realizing the Company's gross
deferred tax asset (taking into consideration applicable
statutory carryforward periods), the Company determined that the
recognition criteria set forth in SFAS No. 109, "Accounting for
Income Taxes", are not met for the entire gross deferred tax
asset and, accordingly, the gross deferred tax asset is reduced
by a valuation allowance.  The analysis of the likelihood of
realizing the gross deferred tax asset is reviewed and updated
periodically.  Any required adjustments to the valuation
allowance are made in the period in which the developments on
which they are based become known.  Results for 1993 include tax
benefits of $132 million attributable to such adjustments.













                                 F-16
<PAGE>
      AMERICAN PREMIER UNDERWRITERS, INC. AND SUBSIDIARIES
     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


The significant components of the deferred tax asset included in
the Balance Sheet at December 31, were as follows (in millions):

                                             1995          1994
     Deferred tax assets:
       Net operating loss carryforward     $166.5        $176.7
       Capital loss carryforwards           108.7         115.5
       Insurance claims and reserves        102.9         120.1
       Other, net                            91.3         101.3
                                            469.4         513.6
       Valuation allowance for deferred
         tax assets                        (214.0)       (213.5)
                                            255.4         300.1

     Deferred tax liabilities:
       Deferred acquisition costs           (31.2)        (32.4)
       Investment securities                (23.8)           -
                                            (55.0)        (32.4)

     Net deferred tax asset                $200.4        $267.7

Cash payments for income taxes, net of refunds, were $1.9
million, $3.7 million and $1.0 million for 1995, 1994 and 1993,
respectively.  Substantially all of such payments were for
alternative minimum taxes.

K.   Contingencies

In management's opinion, the outcome of the items discussed below
will not, individually or in the aggregate, have a material
adverse effect on the Company's financial condition or results of
operations.

Pre-Reorganization Matters

The following matters arose out of railroad operations disposed
of by the Company's predecessor, Penn Central Transportation
Company ("PCTC"), prior to its bankruptcy reorganization in 1978
and, accordingly, any ultimate liability arising therefrom in
excess of previously established loss accruals would be
attributable to pre-reorganization events and circumstances.  In
accordance with the Company's pre-reorganization accounting
policy, any such ultimate liability will reduce the Company's
capital surplus and shareholders' equity, but will not be charged
to income.

USX Litigation   Lawsuits have been filed against the Company by
USX Corporation ("USX") and its former subsidiary, Bessemer and
Lake Erie Railroad Company ("B&LE"), seeking contribution by the
Company, as the successor to the railroad business conducted by
PCTC prior to 1976, for amounts that USX paid in satisfaction of
a judgment against B&LE for its participation in an unlawful
antitrust conspiracy among certain railroads.  The lawsuits argue
that USX's liability for that payment was attributable to PCTC's
alleged activities in furtherance of the conspiracy. The Company
and its outside counsel believe that the Company has substantial
defenses to these lawsuits and should not suffer a material loss
as a result of this litigation.

Environmental Matters  The Company's liability for
environmental claims ($64.3 million at December 31, 1995,
before claims for recovery of $9.5 million) consists of a
number of proceedings and claims seeking to impose
responsibility for hazardous waste remediation costs at
certain railroad



                                 F-17
<PAGE>
      AMERICAN PREMIER UNDERWRITERS, INC. AND SUBSIDIARIES
     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


sites formerly owned by PCTC and at certain other sites where
hazardous waste was allegedly generated by PCTC's railroad
operations.  It is difficult to estimate remediation costs for
a number of reasons, including the number and financial
resources of other potentially responsible parties, the range
of costs for remediation alternatives, changing technology and
the time period over which these matters develop.  The
Company's liability is based on information currently
available and is subject to future change as additional
information becomes available.

Personal Injury Matters   The Company's liability for
occupational injury and disease claims ($80.6 million at
December 31, 1995, before claims for recovery of $62.1
million) includes pending and expected claims by former
employees of PCTC of injury or disease allegedly caused by
exposure to excessive noise, asbestos or other substances in
the railroad workplace.  Recorded amounts are based on the
accumulation of estimates of reported and unreported claims
and related expenses and estimates of probable recoveries from
insurance carriers.

Other Matters

In connection with the Company's sale of its General Cable
Corporation securities, the Company assumed responsibility for
certain actual and potential environmental and other liabilities
in consideration of an indemnity payment of $19.2 million.

The Company has agreed to guarantee several third party
obligations which are not material individually or in the
aggregate.  The Company has also entered into various operating
lease agreements related principally to certain administrative
facilities and transportation equipment.

L.   Insurance Operations

Restrictions on Transfers of Funds and Assets   The Company's
insurance operations are subject to state regulations which
limit, by reference to specified measures of statutory operating
results and policyholders' surplus, the dividends that can be
paid to the Parent Company without prior regulatory approval.
Without such approval, the maximum amount of dividends which can
be paid to the Parent Company during 1996 by these subsidiaries
is $80.4 million.  At December 31, 1995 and 1994, statutory
capital and surplus totaled $629.6 million and $643.6 million,
respectively.

Reinsurance  The insurance operations assume and cede a portion
of their written business with other insurance companies in the
normal course of business.  To the extent that any reinsuring
companies are unable to meet their obligations under agreements
covering reinsurance ceded, the Company's insurance subsidiaries
would remain liable.  Amounts deducted from insurance losses and
loss adjustment expenses ("LAE") and net written and earned
premiums in












                                 F-18
<PAGE>      
      AMERICAN PREMIER UNDERWRITERS, INC. AND SUBSIDIARIES
     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


connection with reinsurance ceded to affiliates and
non-affiliated companies, as well as amounts included in net
written and earned premiums for reinsurance assumed from
affiliates and non-affiliated companies, were as follows (in
millions):

                                          1995     1994      1993
Reinsurance ceded:
  Premiums written
     Non-affiliates                     $ 15.5    $20.4     $ 9.3
  Premiums earned
     Non-affiliates                       13.6     18.7       8.9
  Incurred losses and LAE:
     Affiliates                             .6     (1.8)     (2.5)
     Non-affiliates                       20.4     15.9       3.8

Reinsurance assumed:
  Premiums written:
     Affiliates                          134.3    167.6     101.2
     Non-affiliates                       22.9     36.4      74.4
  Premiums earned:
     Affiliates                          128.8    139.4      78.2
     Non-affiliates                       28.8     50.1      60.1

                                           December 31,
                                          1995     1994
Reinsurance ceded:
  Reserves for unpaid loss and LAE:
     Affiliates                         $  7.2    $10.2
     Non-affiliates                       52.2     40.7

The allowance for uncollectible reinsurance was $1.5 million at
December 31, 1995 and 1994.

Liability for Losses and Loss Adjustment Expenses  The following
table provides an analysis of changes in the estimated liability
for losses and LAE, net of reinsurance activity (in millions).

                                          1995      1994     1993
Balance at beginning of year, net of
 reinsurance                            $1,080    $  916    $ 764

Provision for losses and LAE occurring
 in the current year                     1,247     1,170      915
Net decrease in provision for claims
 occurring in prior years                  (49)      (79)     (58)
                                         1,198     1,091      857
Payments for losses and LAE occurring during:
 Current year                              662       554      413
 Prior years                               480       386      346
                                         1,142       940      759
Loss and LAE reserves of subsidiaries
 purchased                                  -         13       54

Balance at end of year, net of 
  reinsurance                             1,136     1,080      916

Reinsurance receivable on unpaid losses
 and LAE at end of year                     59        51       45
Balance at end of period, gross of
 reinsurance receivable                 $1,195    $1,131    $ 961

                              F-19
<PAGE>
      AMERICAN PREMIER UNDERWRITERS, INC. AND SUBSIDIARIES
     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


The decreases in the provision for claims occurring in prior
years resulted from reductions in the estimated ultimate losses
and LAE related to such claims.

Other   Statutory net income for 1995, 1994 and 1993 was $61.0
million, $79.6 million and $93.0 million, respectively.  Deferred
policy acquisition costs amortized to income were $298.2 million,
$292.3 million and $243.8 million for 1995, 1994 and 1993,
respectively.  Net written premiums for 1995, 1994 and 1993 were
$1,492 million, $1,636 million and $1,379 million, respectively.

At December 31, 1995 and 1994, reserves for uncollectible
premiums receivable were $6.6 million and $5.9 million,
respectively.

During 1995, 1994 and 1993, 41%, 89% and 95%, respectively, of
net premiums written in the workers' compensation insurance
operations were for policies eligible for policyholder dividend
consideration.

M.   Statement of Cash Flows

In February 1994, General Cable delivered to the Company $41.7
million in promissory notes as a partial payment of the General
Cable Notes.  During 1993, General Cable elected to pay the $31.8
million of interest due on the General Cable Note with Interest
Notes in lieu of cash.  These non-cash transactions, which
increased the Parent Company investments and decreased accrued
investment income, are not included in the Statement of Cash
Flows.

N.   Transactions With Affiliates

Various business has been transacted between the Company and
certain affiliate companies including rentals, investment
management services, insurance and sales of assets.  Unless
otherwise disclosed, none of these transactions had a material
effect on the net earnings or equity of the Company.  Aggregate
charges for these services within the Company and its
subsidiaries have been insignificant in relation to consolidated
revenues.

During 1995, the Company purchased 3.2 million shares of Chiquita
from AFC for $43.7 million.  Also during 1995, the Company sold
(i) certain properties to a subsidiary of AFC for aggregate
proceeds of $15.9 million; (ii) a small reinsurance subsidiary to
AFC for $13.7 million; and (iii) shares of an affiliate to AFC
for $553,000.  The Company recognized a loss of $2.1 million on
the sales.

During 1990, the Company acquired the nonstandard automobile
insurance business (the "NSA Group") from AFC.  The purchase
price was subject to adjustment in 1995, based on 1991-1994
pretax earnings of the NSA Group, by a reduction of up to $20.0
million or an increase of up to $40.0 million, in each case plus
interest.  In December 1993, the Company, having concluded that
it was highly probable that the maximum adjustment would be
payable by the Company, paid $40.0 million, plus $12.8 million of
interest, to a subsidiary of AFC, in full settlement in order to
cut off the accrual of interest at the relatively high rate
prescribed by the acquisition agreement.  Also, as  part









                              F-20
<PAGE>      
      AMERICAN PREMIER UNDERWRITERS, INC. AND SUBSIDIARIES
     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


of the agreement for the purchase of the NSA Group, AFC, through
a subsidiary, provided stop-loss protection to the Company which,
in effect, guaranteed the adequacy of unpaid loss and allocated
loss adjustment expense reserves of the NSA Group (net of
reinsurance and salvage and subrogation recoveries) related to
periods prior to 1991 under policies written and assumed by the
NSA Group.  By mutual agreement, effective December 31, 1995, the
parties cancelled this arrangement and settled all amounts due.

In 1988, the Company's workers' compensation insurance operations
("Republic Indemnity") entered into a reinsurance contract with
Great American Insurance Company ("GAI") to cover the aggregate
losses on workers' compensation coverage for the accident years
1980-1987, inclusive.  The contract provides for coverage by GAI
of net aggregate paid losses of Republic Indemnity in excess of a
certain threshold, up to a maximum of $35.1 million.  Cumulative
paid losses at December 31, 1995 pertaining to claims during this
period exceeded the threshold amount by approximately $1 million.
In addition, GAI has agreed to reimburse Republic Indemnity for
its loss adjustment expenses pertaining to this period up to a
maximum of $4.9 million.

O.   Quarterly Operating Results   (Unaudited)

Summarized quarterly financial data for 1995 and 1994 are set
forth below (in millions).

                            1st      2nd     3rd       4th
                        Quarter  Quarter Quarter   Quarter     Total
1995:
Revenues                $432.8   $437.2  $433.3    $432.2   $1,735.5
Net earnings from
  continuing operations   16.3     13.6    18.2      19.0       67.1
Net earnings              16.3      9.5    17.6      18.6       62.0


1994:
Revenues                 357.3    467.9   475.8     457.9   $1,758.9
Net earnings (loss) from
  continuing operations  (55.9)    16.6    25.2      14.9         .8
Net earnings (loss)      (55.9)    15.2    26.1      14.9         .3



The first quarter 1994 results include a pretax loss of $76
million on the sale of General Cable securities.  Realized gains
(losses) on sales of securities amounted to (in millions):

                       1st      2nd     3rd       4th
                     Quarter  Quarter Quarter   Quarter     Total
  1995                 $(.2)    $1.6    $7.1     $15.3     $23.8
  1994                   .6      1.3    (1.0)      (.8)       .1


P.   Additional Information

Total rental expense recorded under various operating leases
related to certain administrative facilities and transportation
equipment was $13.3 million in 1995, $12.9 million in 1994, and
$13.3 million 1993.




                              F-21
 <PAGE>
      AMERICAN PREMIER UNDERWRITERS, INC. AND SUBSIDIARIES
     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


Future minimum rentals required under noncancelable lease
agreements at December 31, 1995, related principally to certain
administrative facilities and transportation equipment, were as
follows: 1996--$12.3 million, 1997--$11.5 million, 1998--$9.3
million, 1999--$7.6 million, 2000--$5.8 million and $10.6 million
thereafter.

Other operating and general expenses included charges for
possible losses on agents' balances, reinsurance recoverables and
other receivables in the following amounts: 1995 - $0, 1994 - $1
million and 1993 - $6 million.  The aggregate allowance for such
losses amounted to approximately $14 million at December 31, 1995
and 1994.

Fair Value of Financial Instrument   The following table presents
(in millions) the carrying value and estimated fair value of the
Company's financial instruments at December 31.
                                  1995                 1994
                           Carrying    Fair     Carrying    Fair
                              Value   Value        Value   Value
     Assets:
     Bonds and redeemable
       preferred stocks      $1,870  $1,880       $2,340  $2,261
     Other stocks                 4       4            5       5

     Liabilities:
     Long-term debt:
       Parent company        $  321  $  344       $  500  $  519
       Other subsidiaries         9       9           10      10


When available, fair values are based on prices quoted in the
most active market for each security.  If quoted prices are
not available, fair value is estimated based on present
values, discounted cash flows, fair value of comparable
securities, or similar methods.

Q.   Subsequent Event (Unaudited)

In March 1996, the Company sold the stock of a subsidiary,
Buckeye Management Company ("Buckeye"), to an investment group
consisting of members of Buckeye's management team and employees
for approximately $63 million in cash.  Buckeye holds, directly
and indirectly, a 2% general partnership interest in Buckeye
Partners, L.P. which, through its subsidiary entities, is an
independent pipeline common carrier of refined petroleum
products.  The Company's pretax gain of approximately $53 million
from the sale will be reported in 1996.  The Chairman of the
Board and Chief Executive Officer of Buckeye was also a director
of the Company, until resigning in March 1996.















                                 F-22
<PAGE>                             
                             PART IV
                                
                             ITEM 14

   Exhibits, Financial Statement Schedules and Reports on Form
                               8-K


(a)  Documents filed as part of this Report:
       1. Financial Statements are included in Part II, Item 8.

       2. Financial Statement Schedules:
          A. Selected Quarterly Financial Data is included in
             Note O to the Consolidated Financial Statements.

          B. Schedules filed herewith for 1995, 1994 and 1993:

                                                                 Page
          III - Condensed Financial Information of Registrant     S-2


          All other schedules for which provisions are made in the
          applicable regulation of the Securities and Exchange
          Commission have been omitted as they are not
          applicable, not required, or the information required
          thereby is set forth in the Financial Statements or
          the notes thereto.

    3.  Exhibits - see Exhibit Index on page E-1.

(b) Reports on Form 8-K:

          Date of Report          Item Reported

          December 13, 1995       Court of Appeals Ruling - USX
                                  Litigation




























                                   S-1
<PAGE>               
               AMERICAN PREMIER UNDERWRITERS, INC.
  SCHEDULE III - CONDENSED FINANCIAL INFORMATION OF REGISTRANT
                          (In Millions)
                                
                 Condensed Statement of Earnings
<TABLE>                                
<CAPTION>
                                                  Year Ended December 31,  
                                               1995       1994       1993
<S>                                          <C>       <C>         <C>
Income:
  Equity in earnings of subsidiaries         $161.5     $184.6     $279.6
  Net investment income                         3.9       11.1       33.0
  Losses on sales of subsidiaries                -        (4.0)     (21.5)
  Loss on sale of General Cable Corporation 
    securities                                   -       (75.8)        -
  Realized gains (losses) on sales of 
    securities                                  (.9)        .2        9.2
  Other income                                 23.7       14.3        9.8
                                              188.2      130.4      310.1

Costs and Expenses:
  Interest and debt expense                    44.9       52.8       62.6
  Provision for asset impairment                 -          -        16.4
  Other operating and general expenses         29.7       37.7       41.9
                                               74.6       90.5      120.9

Earnings before income taxes                  113.6       39.9      189.2
Income tax (expense) benefit                  (46.5)     (39.1)      53.5
Net earnings from continuing operations        67.1         .8      242.7

Discontinued Operations:
  Equity in earnings of subsidiaries             -          -         2.8
  Loss from disposal of businesses               -         (.5)     (13.5)

Extraordinary loss, net of tax benefit         (5.1)        -          -

Net Earnings                                 $ 62.0      $  .3     $232.0



                     Condensed Balance Sheet

                                                      December 31,
                                                  1995       1994
Assets
  Cash and short-term investments             $   37.4  $    99.9
  Receivables from subsidiaries                  325.8      403.1
  Investments in subsidiaries                  1,948.5    1,735.6
  Other investments                               24.7      173.0
  Deferred tax asset                             200.4      267.7
  Other assets                                   109.3      123.1

                                              $2,646.1  $ 2,802.4

Liabilities and Capital
  Accounts payable, accrued expenses and other
    liabilities                               $  254.5   $  308.4
  Payables to subsidiaries                       434.0      445.3
  Long-term debt                                 320.6      500.0
  Payable to American Financial Group, Inc.       85.1         -
  Other capital                                1,551.9    1,548.7

                                              $2,646.1   $2,802.4
</TABLE>
                                      S-2
<PAGE>               
               AMERICAN PREMIER UNDERWRITERS, INC.
 SCHEDULE III - CONDENSED FINANCIAL INFORMATION OF REGISTRANT -
                            CONTINUED
                          (In Millions)
                                
                Condensed Statement of Cash Flows
<TABLE>
<CAPTION>
                                              Year Ended December 31,
Operating Activities:                        1995      1994       1993
 <S>                                      <C>       <C>        <C>
 Net earnings from continuing operations  $  67.1   $    .8    $ 242.7
 Adjustments:
   Equity in earnings of subsidiaries      (161.5)   (184.6)    (279.6)
   Deferred Federal income tax               46.0      36.3      (57.9)
   Net (gain) loss on disposal of businesses,
    investments, and PP&E                   (16.8)     77.9       28.7
   Cash received from subsidiaries           87.7     114.1      127.4
   Litigation settlement                       -         -        15.6
   Other, net                                (9.0)      9.4      (34.6)
                                             13.5      53.9       42.3

Investing Activities:
 Purchases of other investments              (1.1)   (128.8)     (11.4)
 Sales of other investments                 158.2      36.3      102.4
 Sale of General Cable Corporation 
   Securities                                  -      176.7         -
 Other, net                                  11.0      11.5        5.7
                                            168.1      95.7       96.7


Financing Activities:
 Purchases of Company Common Stock          (87.6)    (47.7)     (1.9)
 Repayment of debt                         (186.1)    (16.3)   (133.7)
 Common Stock dividends                     (57.3)    (40.6)    (38.2)
 Advances from American Financial 
   Group, Inc.                               86.7        -         -
 Other, net                                    .2      18.1      23.4
                                           (244.1)    (86.5)   (150.4)

Net increase (decrease) in cash and short-term
  investments from continuing operations    (62.5)     63.1     (11.4)
Net increase in cash and short-term
  investments from discontinued operations     -         -        8.3

Net increase (decrease) in cash and short-term
  Investments                               (62.5)     63.1      (3.1)
Cash and short-term investments at beginning
  of period                                  99.9      36.8      39.9

Cash and short-term investments at end 
  of period                               $  37.4   $  99.9   $  36.8

Cash dividends received from equity method
  accounting investees                    $    -    $    -    $   1.9
</TABLE>


                                   S-3
<PAGE>
                              Signatures


    Pursuant to the requirements of Section 13 of the Securities
Exchange Act of 1934, American Premier Underwriters, Inc. has duly
caused this Report to be signed on its behalf by the undersigned, duly
authorized.

                                     American Premier Underwriters, Inc.


Signed:  March 27, 1996              BY:s/CARL H. LINDNER
                                          Carl H. Lindner
                                          Chairman of the Board and
                                            Chief Executive Officer






    Pursuant to the requirements of the Securities Exchange Act of
1934, this Report has been signed below by the following persons on
behalf of the Registrant and in the capacities and on the dates
indicated:

      Signature                    Capacity                  Date


s/CARL H. LINDNER             Chairman of the Board     March 27, 1996
  Carl H. Lindner               of Directors


s/THEODORE H. EMMERICH        Director*                 March 27, 1996
  Theodore H. Emmerich


s/JAMES E. EVANS              Director                  March 27, 1996
  James E. Evans


s/THOMAS M. HUNT                                        Director March
27, 1996
  Thomas M. Hunt


s/S. CRAIG LINDNER            Director                  March 27, 1996
  S. Craig Lindner


s/KEITH E. LINDNER            Director                  March 27, 1996
  Keith E. Lindner


s/CARL H. LINDNER III         Director                  March 27, 1996
  Carl H. Lindner III


s/WILLIAM R. MARTIN           Director*                 March 27, 1996
  William R. Martin


s/FRED J. RUNK                Senior Vice President and March 27, 1996
  Fred J. Runk                  Treasurer (Principal
                                Financial and Accounting
                                Officer)

*  Member of the Audit Committee
<PAGE>
                        INDEX TO EXHIBITS

               AMERICAN PREMIER UNDERWRITERS, INC.


Number              Exhibit Description

<TABLE>
<CAPTION>
  <S>      <C>                                              <C>
  2        Agreement and Plan of Acquisition                (*)
           and Reorganization, filed as Exhibit 2
           to the Registration Statement on
           Form S-4 No. 33-56813 (effective
           February 17, 1995) of American Premier
           Group, Inc. (now American Financial
           Group, Inc.)

  3 (a)    Amended and Restated Articles of                 (*)
           Incorporation, as amended effective
           March 25, 1994, filed as Exhibit 3(i)
           to the Company's Form 10-K for 1993.

  3 (b)    By-Laws, as amended February 15, 1995,           (*)
           filed as Exhibit 3(ii) to the Company's
           Form 10-K for 1994.

  4 (a)    Order No. 3708 of the United States              (*)
           District Court for the Eastern
           District of Pennsylvania in In the
           Matter of Penn Central Transportation
           Company, Debtor, Bankruptcy No. 70-347
           dated August 17, 1978 directing the
           consummation of the Plan of Reorganization
           for Penn Central Transportation Company,
           filed as Exhibit 4 to Form 8-K Current
           Report of Penn Central Transportation
           Company for August 1978.


  4 (b)    Instruments defining the            Registrant has no outstanding
           rights of security holders.         debt issues exceeding 10% of
                                               the assets of Registrant and
                                               consolidated subsidiaries.  Upon 
                                               request, the Company hereby agrees 
                                               to furnish supplementally                                                   
                                               to the Securities and Exchange
                                               Commission a copy of each
                                               instrument with respect to long-                                 
                                               term debt which does not exceed                                       
                                               10% of total assets.

 10 (a)    Management Agreement effective as of             (*)
           January 1, 1991, by and between
           Dixie Insurance Company (now Infinity
           Insurance Company) and Stonewall
           Insurance Company, filed as Exhibit
           (10)(iii)(o)(iii) to the Company's
           Form 10-K for 1990.

 10 (b)    Assumption and Bulk Reinsurance Agreement,       (*)
           effective December 31, 1994, between
           Stonewall Insurance Company and
           Infinity Insurance Company, filed as
           Exhibit (10)(iii)(h)(iv) to the Company's
           Form 10-K for 1994.
</TABLE>
                                 E-1
  <PAGE>
 10 (c)    Premium Payment Agreement, effective as of       (*)
           January 1, 1991, by and between Great
           American Insurance Company and the Company
           filed as Exhibit (10)(iii)(q) to the Company's
           Company's Form 10-K for 1990.

 10 (d)    Excess of Loss Agreement, effective              (*)
           March 31, 1988, between Republic Indemnity
           Company of America and Great American
           Insurance Company, filed as Exhibit (g)(l)
           to Amendment No. 1 to Schedule 13E-3, dated
           January 17, 1989, relating to Republic
           American Corporation filed by Republic
           American Corporation, the Company, RAWC
           Acquisition Corp., American Financial
           Corporation and Carl H. Lindner (the
           "Schedule 13E-3 Amendment").

 10 (e)    First Amendment to Excess of Loss                (*)
           Agreement, effective March 31, 1988, between
           Republic Indemnity Company of America and
           Great American Insurance Company, filed as
           Exhibit (g)(2) to the Schedule 13E-3 Amendment.

 10 (f)    Business Assumption Agreement, effective         (*)
           as of December 31, 1990, between Stonewall
           Insurance Company and Dixie Insurance
           Company (now Infinity Insurance Company),
           filed as Exhibit (10)(iii)(o)(i) to the
           Company's Form 10-K for 1990.

 10 (g)    Quota Share Agreements, effective                (*)
           December 31, 1990, between Stonewall
           Insurance Company and Dixie Insurance
           Company (now Infinity Insurance Company),
           filed as Exhibit (10)(iii)(o)(ii) to
           the Company's Form 10-K for 1990.

 10 (h)    Letter dated April 9, 1987 from the              (*)
           Company to Neil M. Hahl, an executive
           officer of the Company, with respect to
           severance arrangements, as supplemented
           by a letter dated June 26, 1987 to
           Neil M. Hahl, incorporated by reference
           to Exhibit (10)(iii)(a) to the Company's
           Form 10-Q Quarterly Report for the Quarter
           Ended June 30, 1987.

 10 (i)    Stock Purchase Agreement Relating to the        _____
           Acquisition of Buckeye Management Company
           by BMC Acquisition Company dated
           January 5, 1996.

 12        Computation of ratio of earnings                 _____
           to fixed charges.

 16        Letter on change in certifying accountant  (*)
           filed as Exhibit 16 to the Company's
           Form 8-K Current Report for August 29, 1995.






                                 E-2
<PAGE>
 21        Subsidiaries of the Registrant.                  _____

 27        Financial data schedule                           (**)

 28        Information from reports furnished to            _____
           state insurance regulatory authorities.




 (*)  Incorporated herein by reference
(**)  Copy included in Report filed electronically with the Securities
        and Exchange Commission.



















































                                 E-3
  <PAGE>
  AMERICAN PREMIER UNDERWRITERS, INC. AND CONSOLIDATED SUBSIDIARIES

   EXHIBIT 12 - COMPUTATION OF RATIOS OF EARNINGS TO FIXED CHARGES
                        (Dollars in Millions)
<TABLE>
<CAPTION>
                                        Year Ended December 31,
                                     1995   1994    1993   1992    1991
<S>                                <C>    <C>     <C>     <C>     <C>
Pretax income excluding
  discontinued operations          $113.0 $ 41.2  $190.1  $ 84.1  $ 79.4

Less undistributed equity in                                      
  (earnings) losses of affiliates    2.7      -       -       -       -

Fixed charges:
  Interest expense                  44.9    53.2    62.8    69.6    65.3
  One-third of rentals               4.4     4.3     4.4     4.4     3.7

    EARNINGS                      $165.0  $ 98.7  $257.3  $158.1  $148.4



Fixed charges:
  Interest expense                $ 44.9  $ 53.2  $ 62.8  $ 69.6  $ 65.3
  One-third of rentals               4.4     4.3     4.4     4.4     3.7

    FIXED CHARGES                 $ 49.3  $ 57.5  $ 67.2  $ 74.0  $ 69.0



Ratio of Earnings to Fixed Charges 3.35     1.72    3.83    2.14    2.15

Earnings in Excess of Fixed 
  Charges                        $115.7   $ 41.2  $190.1  $ 84.1  $ 79.4
</TABLE>





























                                 E-4
<PAGE>                                
               AMERICAN PREMIER UNDERWRITERS, INC.
                                
           EXHIBIT 21 - SUBSIDIARIES OF THE REGISTRANT

     The following is a list of subsidiaries of American Premier
Underwriters, Inc. (the "Company") included in the Company's
continuing operations at December 31, 1995.  All corporations are
subsidiaries of the Company and, if indented, subsidiaries of the
company under which they are listed.


                                           Jurisdiction    Percentage of
                                                of         Common Equity
                                          Incorporation        Ownership

Pennsylvania Company                           Delaware         100%
 Atlanta Casualty Company (1)                  Illinois         100
   American Premier Insurance Company          Indiana          100
   Atlanta Specialty Insurance Company         Iowa             100
   Mr. Agency of Georgia, Inc.                 Georgia          100
     Atlanta Casualty General Agency, Inc.     Texas            100
     Atlanta Insurance Brokers, Inc.           Georgia          100
     Treaty House, Ltd. (d/b/a Mr. Budget)     Nevada           100
   Penn Central U.K. Limited                   United Kingdom   100
     Insurance (GB) Limited                    United Kingdom   100
 Buckeye Management Company                    Delaware         100
   Buckeye Pipe Line Company                   Delaware         100
 Great Southwest Corporation                   Delaware         100
   World Houston, Inc.                         Delaware         100
 Hangar Acquisition Corporation                Ohio             100
  Infinity Insurance Company                   Florida          100
   Infinity Agency of Texas, Inc.              Texas            100
   The Infinity Group, Inc.                    Indiana          100
   Infinity Select Insurance Company           Indiana          100
   Infinity Southern Insurance Corporation     Alabama          100
   Leader National Insurance Company           Ohio             100
     Budget Insurance Premiums, Inc.           Ohio             100
     Leader National Agency, Inc.              Ohio             100
     Leader National Agency of Texas, Inc.     Texas            100
     Leader National Insurance Agency of Arizona
                                               Arizona          100
     Leader Preferred Insurance Company        Ohio             100
     Leader Specialty Insurance Company        Indiana          100
 PCC Technical Industries, Inc.                California       100
   ESC, Inc.                                   California       100
   Marathon Manufacturing Companies, Inc.      Delaware         100
     Marathon Manufacturing Company            Delaware         100
   PCC Maryland Realty Corp.                   Maryland         100
   Penn Camarillo Realty Corp.                 California       100
 Republic Indemnity Company of America         California       100
   Republic Indemnity Company of California    California       100
   Timberglen Limited                          United Kingdom   100
 Risico Management Corporation                 Delaware         100
 Windsor Insurance Company (1)                 Indiana          100
   American Deposit Insurance Company          Oklahoma         100
Granite Finance Co., Inc.                      Texas            100
   Coventry Insurance Company                  Ohio             100
   El Aguila Compania de Seguros, S.A. de C.V. Mexico           100







                                 E-5
<PAGE>
               AMERICAN PREMIER UNDERWRITERS, INC.
                                
     EXHIBIT 21 - SUBSIDIARIES OF THE REGISTRANT - CONTINUED


                                             Jurisdiction    Percentage of
                                                 of          Common Equity
                                             Incorporation       Ownership
                                                                 
   Moore Group Inc.                             Georgia          100%
     Casualty Underwriters, Inc.                Georgia           51
     Dudley L. Moore Insurance, Inc.            Louisiana        100
     Hallmark General Insurance Agency, Inc.    Oklahoma         100
     Middle Tennessee Underwriters, Inc.        Tennessee        100
       Insurance Finance Company                Tennessee        100
     Windsor Group, Inc.                        Georgia          100
   Regal Insurance Company                      Indiana          100
   Texas Windsor Group, Inc.                    Texas            100
PCC Real Estate, Inc.                           New York         100
 PCC Chicago Realty Corp.                       New York         100
 PCC Gun Hill Realty Corp.                      New York         100
 PCC Michigan Realty, Inc.                      Michigan         100
 PCC Scarsdale Realty Corp.                     New York         100
   Scarsdale Depot Associates, L.P.             Delaware          80
Penn Central Energy Management Company          Delaware         100
______________

(1) 90.05% owned by Pennsylvania Company and 9.95% owned by
    Republic Indemnity Company of America.

 The names of certain subsidiaries are omitted, as such subsidiaries
in the aggregate would not constitute a significant subsidiary.






























                                 E-6
<PAGE>
               AMERICAN PREMIER UNDERWRITERS, INC.

         EXHIBIT 28 - INFORMATION FROM REPORTS FURNISHED
            TO STATE INSURANCE REGULATORY AUTHORITIES
                                
                                
                                
                 Schedule P of Annual Statements



A.  CONSOLIDATED PROPERTY AND CASUALTY ENTITIES   -   See
Attached Schedules

     Schedule P (prepared in accordance with the rules
     prescribed by the National Association of Insurance
     Commissioners) includes the reserves of American Premier
     Underwriters, Inc.'s consolidated property and casualty
     subsidiaries.  The following is a summary of Schedule P
     reserves (in millions):


     Schedule P - Part 1 Summary - col. 33                  $  903
                                 - col. 34                     213
     Statutory Loss and Loss Adjustment Expense Reserves    $1,116



B.  UNCONSOLIDATED SUBSIDIARIES                               None



C.  50% OR LESS OWNED PROPERTY AND CASUALTY INVESTEES         None





























                                   E-7
<PAGE>