SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549


                                    FORM 10-Q

(Mark  One)
/X/   QUARTERLY  REPORT  PURSUANT  TO  SECTION  13  OR  15 (d) OF THE SECURITIES
      EXCHANGE  ACT  OF  1934

                                       OR

/  /  TRANSITION  REPORT  PURSUANT  TO  SECTION  13 OR 15 (d) OF THE SECURITIES
      EXCHANGE  ACT  OF  1934

                  For the quarterly period ended March 31, 2000


                           Commission File No. 33-5014


                     FIRST SUNAMERICA LIFE INSURANCE COMPANY


      Incorporated  in  New  York                            06-0992729
                                                            IRS  Employer
                                                          Identification  No.

              733 Third Avenue, 4th Floor, New York, New York 10017
       Registrant's telephone number, including area code:  (800) 272-3007


     INDICATE  BY  CHECK  MARK  WHETHER THE REGISTRANT (1) HAS FILED ALL REPORTS
REQUIRED  TO  BE FILED BY SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF
1934  DURING  THE  PRECEDING  12  MONTHS  (OR  FOR  SUCH SHORTER PERIOD THAT THE
REGISTRANT  WAS REQUIRED TO FILE SUCH REPORTS), AND (2) HAS BEEN SUBJECT TO SUCH
FILING  REQUIREMENTS  FOR  THE  PAST  90  DAYS  Yes  X  No  ___
                                                    --

     THE NUMBER OF SHARES OUTSTANDING OF THE REGISTRANTS COMMON STOCK ON MAY 11,
2000  WAS  AS  FOLLOWS:

Common  Stock  (par  value  $10,000.00 per share)         300 shares outstanding


<TABLE>
<CAPTION>

                     FIRST SUNAMERICA LIFE INSURANCE COMPANY

                                      INDEX




                                                                    Page
                                                                  Number(s)
                                                                  ---------
<S>                                                               <C>
Part I - Financial Information

      Balance Sheet (Unaudited) -
      March 31, 2000 and December 31, 1999 . . . . . . . . . . .          3

      Statement of Income and Comprehensive Income (Unaudited)-
      Three Months Ended March 31, 2000 and 1999 . . . . . . . .          4

      Statement of Cash Flows (Unaudited) -
      Three Months Ended March 31, 2000 and 1999 . . . . . . . .        5-6

      Notes to Financial Statements (Unaudited). . . . . . . . .          7

      Management's Discussion and Analysis of Financial
      Condition and Results of Operations. . . . . . . . . . . .       8-20

      Quantitative and Qualitative Disclosures About Market
      Risk . . . . . . . . . . . . . . . . . . . . . . . . . . .         21

Part II - Other Information. . . . . . . . . . . . . . . . . . .         22
</TABLE>


<PAGE>
<TABLE>
<CAPTION>

                     FIRST SUNAMERICA LIFE INSURANCE COMPANY
                                  BALANCE SHEET
                                   (Unaudited)

                                                  March  31,   December  31,
                                                        2000            1999
                                              --------------  --------------
<S>                                           <C>              <C>

ASSETS

Investments:
  Cash and short-term investments. . . . . .  $   50,708,000   $   29,350,000
  Bonds and notes available for sale,
    at fair value (amortized cost:
    March 2000, $1,485,661,000
    December 1999, $1,587,116,000) . . . . .   1,411,658,000    1,522,921,000
  Mortgage loans . . . . . . . . . . . . . .     208,564,000      211,867,000
  Other invested assets. . . . . . . . . . .      41,588,000       42,604,000
                                              ---------------  ---------------

  Total investments. . . . . . . . . . . . .   1,712,518,000    1,806,742,000

Variable annuity assets held in separate
  accounts . . . . . . . . . . . . . . . . .     612,091,000      558,605,000
Accrued investment income. . . . . . . . . .      20,484,000       24,076,000
Deferred acquisition costs . . . . . . . . .     134,943,000      137,637,000
Current income taxes . . . . . . . . . . . .       7,454,000        6,638,000
Deferred income taxes. . . . . . . . . . . .      20,063,000       18,275,000
Other assets . . . . . . . . . . . . . . . .       3,124,000        3,539,000
                                              ---------------  ---------------

TOTAL ASSETS . . . . . . . . . . . . . . . .  $2,510,677,000   $2,555,512,000
                                              ===============  ===============

LIABILITIES AND SHAREHOLDER'S EQUITY

Reserves, payables and accrued liabilities:
  Reserves for fixed annuity contracts . . .  $1,445,716,000   $1,523,641,000
  Reserves for universal life insurance
    contracts. . . . . . . . . . . . . . . .     274,113,000      277,250,000
  Other liabilities. . . . . . . . . . . . .      19,670,000       34,776,000
                                              ---------------  ---------------

  Total reserves, payable and accrued
    liabilities. . . . . . . . . . . . . . .   1,739,499,000    1,835,667,000
                                              ---------------  ---------------

Variable annuity liabilities related to
  separate accounts. . . . . . . . . . . . .     612,091,000      558,605,000
                                              ---------------  ---------------

Shareholder's equity:
  Common Stock . . . . . . . . . . . . . . .       3,000,000        3,000,000
  Additional paid-in capital . . . . . . . .     144,428,000      144,428,000
  Retained earnings. . . . . . . . . . . . .      46,956,000       42,409,000
  Accumulated other comprehensive loss . . .     (35,297,000)     (28,597,000)
                                              ---------------  ---------------

  Total shareholder's equity . . . . . . . .     159,087,000      161,240,000
                                              ---------------  ---------------

TOTAL LIABILITIES AND SHAREHOLDER'S EQUITY .  $2,510,677,000   $2,555,512,000
                                              ===============  ===============
</TABLE>


                             See accompanying notes

                                        3
<PAGE>
<TABLE>
<CAPTION>

                     FIRST SUNAMERICA LIFE INSURANCE COMPANY
                  STATEMENT OF INCOME AND COMPREHENSIVE INCOME
               For the three months ended March 31, 2000 and 1999
                                   (Unaudited)


                                                       2000           1999
                                               ------------  -------------
<S>                                            <C>            <C>
Investment income . . . . . . . . . . . . . .  $ 33,330,000   $ 28,047,000
                                               -------------  -------------

Interest expense on:
  Fixed annuity contracts . . . . . . . . . .   (18,305,000)   (17,533,000)
  Universal life insurance contracts             (3,132,000)           ---
                                               -------------  -------------

  Total interest expense. . . . . . . . . . .   (21,437,000)   (17,533,000)
                                               -------------  -------------

NET INVESTMENT INCOME . . . . . . . . . . . .    11,893,000     10,514,000
                                               -------------  -------------

NET REALIZED INVESTMENT GAINS
  (LOSSES). . . . . . . . . . . . . . . . . .    (1,513,000)       153,000
                                               -------------  -------------

Fee income:
  Variable annuity fees . . . . . . . . . . .     2,204,000      1,369,000
  Universal life insurance fees                     500,000            ---
  Surrender charges . . . . . . . . . . . . .       772,000        643,000
                                               -------------  -------------

TOTAL FEE INCOME. . . . . . . . . . . . . . .     3,476,000      2,012,000
                                               -------------  -------------

GENERAL AND ADMINISTRATIVE EXPENSES . . . . .    (1,448,000)    (1,010,000)
                                               -------------  -------------

AMORTIZATION OF DEFERRED
  ACQUISITION COSTS . . . . . . . . . . . . .    (4,809,000)    (5,100,000)
                                               -------------  -------------

ANNUAL COMMISSIONS. . . . . . . . . . . . . .      (173,000)       (82,000)
                                               -------------  -------------

PRETAX INCOME . . . . . . . . . . . . . . . .     7,426,000      6,487,000

Income tax expense. . . . . . . . . . . . . .    (2,879,000)    (2,666,000)
                                               -------------  -------------


NET INCOME. . . . . . . . . . . . . . . . . .     4,547,000      3,821,000


OTHER COMPREHENSIVE LOSS, NET OF TAX:
  Net unrealized losses on debt and equity
    securities available for sale identified
    in the current period (net of income tax
    benefit of $3,971,000 for 2000 and
    $1,435,000 for 1999). . . . . . . . . . .    (7,375,000)    (2,666,000)
  Less reclassification adjustment for net
    realized losses (gains) included in net
    income (net of income tax expense of
    $363,000 for 2000 and income tax benefit
    of $17,000 for 1999). . . . . . . . . . .       675,000        (30,000)
                                               -------------  -------------

  OTHER COMPREHENSIVE LOSS. . . . . . . . . .    (6,700,000)    (2,696,000)
                                               -------------  -------------

COMPREHENSIVE INCOME (LOSS) . . . . . . . . .  $ (2,153,000)  $  1,125,000
                                               =============  =============
</TABLE>


                             See accompanying notes

                                        4
<PAGE>
<TABLE>
<CAPTION>

                     FIRST SUNAMERICA LIFE INSURANCE COMPANY
                             STATEMENT OF CASH FLOWS
               For the three months ended March 31, 2000 and 1999
                                   (Unaudited)


                                                      2000            1999
                                              ------------  --------------
<S>                                           <C>            <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income . . . . . . . . . . . . . . . . .  $  4,547,000   $   3,821,000
Adjustments to reconcile net income to get
  cash provided by operating activities:
    Interested credited to:
      Fixed annuity contracts. . . . . . . .    18,305,000      17,533,000
      Universal life insurance contracts         3,132,000             ---
      Net realized investment losses (gains)     1,513,000        (153,000)
      Accretion of net discounts on
        investments. . . . . . . . . . . . .      (999,000)       (725,000)
    Amortization of goodwill                           ---          15,000
    Provision for deferred income taxes          1,820,000             ---
Change in:
  Accrued investment income. . . . . . . . .     3,592,000      (1,206,000)
  Deferred acquisition costs . . . . . . . .     2,194,000       3,001,000
  Income taxes currently payable . . . . . .      (816,000)      2,266,000
  Other liabilities. . . . . . . . . . . . .    (7,158,000)      2,679,000
Other, net . . . . . . . . . . . . . . . . .     1,653,000        (102,000)
                                              -------------  --------------

NET CASH PROVIDED BY OPERATING ACTIVITIES. .    27,783,000      27,129,000
                                              -------------  --------------

CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of:
  Bonds and notes. . . . . . . . . . . . . .    (7,986,000)   (124,947,000)
  Mortgage loans . . . . . . . . . . . . . .       (26,000)    (31,000,000)
Sales of:
  Bonds and notes. . . . . . . . . . . . . .    83,497,000     158,107,000
  Other investments, excluding short-term
    investments. . . . . . . . . . . . . . .       485,000         915,000
Redemptions and maturities of:
  Bonds and notes. . . . . . . . . . . . . .    25,214,000      19,999,000
  Mortgage loans . . . . . . . . . . . . . .     3,460,000      10,463,000
  Other investments, excluding short-term
    investments. . . . . . . . . . . . . . .       617,000         384,000
                                              -------------  --------------

NET CASH PROVIDED BY INVESTING ACTIVITIES. .   105,261,000      33,921,000
                                              -------------  --------------
</TABLE>


                             See accompanying notes

                                        5
<PAGE>
<TABLE>
<CAPTION>

                     FIRST SUNAMERICA LIFE INSURANCE COMPANY
                       STATEMENT OF CASH FLOWS (Continued)
               For the three months ended March 31, 2000 and 1999
                                   (Unaudited)


                                                  2000          1999
                                         -------------  ------------
<S>                                      <C>             <C>
CASH FLOWS FROM FINANCING ACTIVITIES:
Premium receipts on:
  Fixed annuity contracts . . . . . . .  $   6,841,000   $ 16,178,000
  Universal life insurance contracts         2,382,000            ---
  Net exchanges from the fixed accounts
    of variable annuity contracts . . .    (13,524,000)    (9,995,000)
Withdrawal payments on:
  Fixed annuity contracts . . . . . . .    (76,762,000)   (36,618,000)
  Universal life insurance contracts        (8,217,000)           ---
  Claims and annuity payments on fixed
    annuity contracts . . . . . . . . .    (14,458,000)    (6,620,000)
Net receipts from other short-term
  financings. . . . . . . . . . . . . .     (7,948,000)    (1,252,000)
                                         --------------  -------------

NET CASH USED BY FINANCING ACTIVITIES .   (111,686,000)   (38,307,000)
                                         --------------  -------------

NET INCREASE IN CASH AND SHORT-TERM
  INVESTMENTS . . . . . . . . . . . . .     21,358,000     22,743,000

CASH AND SHORT-TERM INVESTMENTS AT
  BEGINNING OF PERIOD . . . . . . . . .     29,350,000     18,466,000
                                         --------------  -------------

CASH AND SHORT-TERM INVESTMENTS AT
  END OF PERIOD . . . . . . . . . . . .  $  50,708,000   $ 41,209,000
                                         ==============  =============


SUPPLEMENTAL CASH FLOW INFORMATION:

Net income taxes paid . . . . . . . . .  $   1,875,000   $  1,600,000
                                         ==============  =============
</TABLE>


                             See accompanying notes

                                        6
<PAGE>

                     FIRST SUNAMERICA LIFE INSURANCE COMPANY
                          NOTES TO FINANCIAL STATEMENTS
                                   (Unaudited)

1.     BASIS  OF  PRESENTATION
       -----------------------

     First  SunAmerica  Life  Insurance  Company  (the "Company") is an indirect
wholly  owned  subsidiary  of  American  International  Group,  Inc. ("AIG"), an
international insurance and financial services holding company. The Company is a
New  York-domiciled  life insurance company engaged primarily in the business of
selling  and  administering  fixed  and  variable  annuities  and universal life
contracts  in  the  State  of  New  York.

     In  the  opinion  of  the  Company,  the  accompanying  unaudited financial
statements  contain  all  adjustments  necessary to present fairly the Company's
financial  position  as  of March 31, 2000 and December 31, 1999, the results of
its  operations and its cash flows for the three months ended March 31, 2000 and
1999.  The  accompanying  unaudited  financial  statements  should  be  read  in
conjunction  with  the  audited financial statements for the year ended December
31,  1999,  contained  in  the  Company's  1999 Annual Report on Form 10-K.  The
results  of  operations  for  the  three  months  ended  March  31, 2000 are not
necessarily indicative of the results to be expected for the full year.  Certain
items  have  been  reclassified to conform to the current period's presentation.

2.     RECENTLY  ISSUED  ACCOUNTING  STANDARD
       --------------------------------------

     In  June  1998, the FASB issued Statement of Financial Accounting Standards
No.  133,  "Accounting for Derivative Instruments and Hedging Activities" ("SFAS
133").  SFAS  133 addresses the accounting for derivative instruments, including
certain  derivative  instruments  embedded  in  other  contracts,  and  hedging
activities.  SFAS  133  was postponed by SFAS 137, and now will be effective for
the  Company  as  of  January  1,  2001.  Therefore,  it  is not included in the
accompanying  financial  statements.  The Company has not completed its analysis
of  the  effect  of  SFAS  133,  but management believes that it will not have a
material  impact  on the Company's results of operations, financial condition or
liquidity.


                                        7
<PAGE>
                     FIRST SUNAMERICA LIFE INSURANCE COMPANY
                      MANAGEMENT'S DISCUSSION AND ANALYSIS
                OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

     Management's  discussion and analysis of financial condition and results of
operations  of  First  SunAmerica Life Insurance Company (the "Company") for the
three  months ended March 31, 2000 ("2000") and March 31, 1999 ("1999") follows.

     In  connection  with the "safe harbor" provisions of the Private Securities
Litigation  Reform  Act  of 1995, the Company cautions readers regarding certain
forward-looking  statements contained in this report and in any other statements
made by, or on behalf of, the Company, whether or not in future filings with the
Securities  and  Exchange Commission (the "SEC"). Forward-looking statements are
statements  not  based  on  historical  information  and  which relate to future
operations,  strategies,  financial  results, or other developments.  Statements
using verbs such as "expect," "anticipate," "believe" or words of similar import
generally  involve  forward-looking statements.  Without limiting the foregoing,
forward-looking  statements  include  statements  which  represent the Company's
beliefs  concerning  future  levels  of  sales  and redemptions of the Company's
products, investment spreads and yields, or the earnings or profitability of the
Company's  activities.

     Forward-looking  statements  are  necessarily  based  on  estimates  and
assumptions  that  are  inherently subject to significant business, economic and
competitive  uncertainties  and  contingencies,  many  of  which  are beyond the
Company's  control and many of which are subject to change.  These uncertainties
and  contingencies  could  cause  actual results to differ materially from those
expressed  in  any  forward-looking  statements  made  by,  or on behalf of, the
Company.  Whether  or  not actual results differ materially from forward-looking
statements  may  depend  on numerous foreseeable and unforeseeable developments.
Some  may  be national in scope, such as general economic conditions, changes in
tax  law  and  changes  in interest rates.  Some may be related to the insurance
industry  generally,  such  as  pricing competition, regulatory developments and
industry  consolidation.  Others may relate to the Company specifically, such as
credit,  volatility  and  other  risks  associated with the Company's investment
portfolio.  Investors  are  also  directed  to  consider  other  risks  and
uncertainties  discussed  in  documents  filed by the Company with the SEC.  The
Company  disclaims  any  obligation  to  update  forward-looking  information.

RESULTS  OF  OPERATIONS

     NET  INCOME  totaled  $4.5  million  in 2000, compared with $3.8 million in
1999.  On  July  1,  1999, the Company acquired the New York individual life and
individual  and  group  annuity  business of MBL Life Assurance Corporation (the
"Acquisition").  The  Acquisition was accounted for under the purchase method of
accounting,  and,  therefore  results  of  operations  include  those  of  the
Acquisition  only  from  its  date  of acquisition.  Consequently, the operating
results  for 2000 and 1999 are not comparable.  On  a pro forma basis, using the
historical  financial information of the acquired business and assuming that the
Acquisition  had  been  consummated  on January 1, 1999, the  beginning  of  the
prior-year  period  discussed  herein,  net  income  would

                                        8

<PAGE>
have  been  $4.1  million  for  the  three  months  ended  March  31,  1999.

     PRETAX  INCOME  totaled  $7.4 million in 2000 and $6.5 million in 1999. The
12.6%  improvement  in 2000 over 1999 resulted primarily from an increase in net
investment  income, increased variable annuity and universal life insurance fees
and  decreased deferred acquisition costs, offset slightly by increased realized
losses  and  general  and  administrative  expenses.

     NET  INVESTMENT  INCOME,  which  is the spread between the income earned on
invested  assets  and  the  interest  paid  on  fixed  annuities  and  other
interest-bearing  liabilities,  increased  to  $11.9  million in 2000 from $10.5
million in 1999.  These amounts equal 2.61% on average invested assets (computed
on  a daily basis) of $1.83 billion in 2000 and 2.82% on average invested assets
of  $1.49  billion  in 1999.  On a pro forma basis, assuming the Acquisition had
been  consummated  on  January 1, 1999, net investment income on related average
invested  assets  would  have  been  1.98%  in 1999. The improvement in 2000 net
investment  yields  over  both  actual  and  pro forma 1999 amounts reflects the
redeployment  of  lower  yielding assets received in the Acquisition into higher
yielding  investment  categories.

     Net investment spreads include the effect of income earned on the excess of
average  invested  assets  over  average  interest-bearing  liabilities. Average
invested  assets  exceeded average interest-bearing liabilities by $66.7 million
in  2000  and $71.2 million in 1999.  The difference between the Company's yield
on  average  invested  assets  and  the  rate  paid  on average interest-bearing
liabilities (the "Spread Difference") was 2.42% in 2000 and 2.58% in 1999.  On a
pro  forma  basis,  assuming  the Acquisition had been consummated on January 1,
1999,  the spread difference would have been 1.86% in 1999, reflecting primarily
the  effect  of  the  lower  yielding  assets  received in the Acquisition.  The
invested  assets  associated with the Acquisition included high-grade corporate,
government  and government/agency bonds, which are generally lower yielding than
a  significant portion of the invested assets that comprise the remainder of the
Company's  portfolio.

     Investment  income  (and  the  related  yield  on  average invested assets)
totaled  $33.3  million  (7.30%)  in 2000 and $28.0 million (7.52%) in 1999. The
decrease  in  the  investment  yield  in  2000 as compared with 1999 principally
reflect  the  effects of lower yielding assets received in the Acquisition. On a
pro  forma  basis,  assuming  the Acquisition had been consummated on January 1,
1999,  the  yield  on  related  average invested assets would have been 6.87% in
1999.

     Total  interest  expense equaled $21.4 million in 2000, compared with $17.5
million  in 1999.  The average rate paid on all interest-bearing liabilities was
4.88%  in  2000  compared  with  4.94%  in  1999.  Interest-bearing  liabilities
averaged $1.76 billion in 2000 and $1.42 billion in 1999.  On a pro forma basis,
assuming  the  Acquisition  had been consummated on January 1, 1999, the average
rate  paid  on  all  interest-bearing  liabilities  would  have  been  5.01% and
interest-bearing  liabilities  would  have  averaged $2.26 billion in 1999.  The
decrease  in the overall rates paid in 2000 results primarily from the continued
reduction  of  crediting  rates  on  certain  closed  blocks of business and the
effects  of  the  Acquisition.



                                        9
<PAGE>
     GROWTH  IN  AVERAGE INVESTED ASSETS largely resulted from the impact of the
Acquisition,  from which the Company acquired $678.3 million of invested assets.
Changes in average invested assets also reflect sales of fixed annuities and the
fixed account options of the Company's variable annuity products ("Fixed Annuity
Premiums"),  and  renewal premiums on its universal life product ("UL Premiums")
acquired  in  the  Acquisition,  partially  offset  by  net exchanges from fixed
accounts  to the separate accounts of variable annuity contracts.  Fixed Annuity
Premiums  and UL Premiums totaled $9.2 million in 2000 and $16.2 million in 1999
and  are  largely  premiums  for the fixed accounts of variable annuities.  Such
premiums have decreased, in part, as a result of regulatory changes in the state
of  New  York  relating  to  non-taxable  policy  exchange  requirements.  On an
annualized  basis,  these  premiums  represent  2%  and 5%, respectively, of the
related  reserve  balances  at  the  beginning  of  the  respective  periods.

     NET  REALIZED INVESTMENT LOSSES totaled $1.5 million in 2000, compared with
net  realized investment gains of $0.2 million in 1999.  Net realized investment
losses  in  2000  include impairment writedowns of $1.2 million and net realized
investment  gains  in 1999 include impairment writedowns of $0.6 million.  Thus,
net  losses  from  sales  and redemptions of investments totaled $0.3 million in
2000,  compared  to  net gains from sales and redemptions of investments of $0.8
million  in  1999.

     The  Company sold or redeemed invested assets, principally bonds and notes,
aggregating  $85.5  million  in  2000  and  $158.6  million  in  1999.  Sales of
investments  result  from  the  active  management  of  the Company's investment
portfolio,  including  assets  received  as  part  of  the Acquisition.  Because
redemptions  of  investments  are generally involuntary and sales of investments
are  made  in  both rising and falling interest rate environments, net gains and
losses  from  sales  and  redemptions  of  investments  fluctuate from period to
period,  and  represent  0.06%  and 0.21% of average invested assets in 2000 and
1999, respectively.  Active portfolio management involves the ongoing evaluation
of  asset sectors, individual securities within the investment portfolio and the
reallocation  of  investments  from  sectors that are perceived to be relatively
overvalued  to  sectors  that  are  perceived to be relatively undervalued.  The
intent of the Company's active portfolio management is to maximize total returns
on  the  investment portfolio, taking into account credit, option, liquidity and
interest-rate  risk.

     Impairment writedowns include provisions applied to bonds in 2000 and 1999.
On  an  annualized  basis,  impairment  writedowns  represent 0.27% and 0.17% of
related  average invested assets for 2000 and 1999, respectively. For the twenty
quarters  beginning April 1, 1995, impairment writedowns as a percent of average
invested  assets  have  ranged  up  to  0.86%  and  have  averaged  0.16%.  Such
writedowns  are  based  upon  estimates  of  the  net  realizable  value  of the
applicable  assets.  Actual  realization  will  be dependent upon future events.

     VARIABLE  ANNUITY  FEES are based on the market value of assets in separate
accounts  supporting variable annuity contracts.  Such fees totaled $2.2 million
in  2000 and $1.4 million in 1999.  The increased fees in 2000 reflect growth in
average variable annuity assets, principally due to increased market values, net
exchanges  into  the  separate  accounts  from the fixed  accounts  of  variable
annuity  contracts  and  the  receipt  of  variable

                                       10
<PAGE>
annuity  premiums,  partially  offset  by  surrenders.  On  an annualized basis,
variable  annuity fees represent 1.5% of average variable annuity assets in 2000
and  1999.  Variable  annuity  assets  averaged  $574.0  million during 2000 and
$358.1  during  1999,  respectively.  Variable  annuity  premiums, which exclude
premiums  allocated  to the fixed accounts of variable annuity products, totaled
$9.9 million and $12.2 million in 2000 and 1999, respectively.  On an annualized
basis,  these  amounts  represent  7%  and 14%, respectively of variable annuity
reserves  at  the beginning of the respective periods.  Transfers from the fixed
accounts  of  the  Company's  variable annuity products to the separate accounts
(see "Growth in Average Invested Assets") are not classified in variable annuity
premiums  (in  accordance  with  generally  accepted  accounting  principles).
Accordingly, changes in variable annuity premiums are not necessarily indicative
of the ultimate allocation by customers among fixed and variable account options
of  the  Company's  variable  annuity  products.

     Sales of variable annuity products (which include premiums allocated to the
fixed accounts) ("Variable Annuity Product Sales") amounted to $17.0 million and
$26.3  million  in  2000 and 1999, respectively.  Variable annuity product sales
primarily  reflect  sales  of  the  Company's  flagship  variable  annuity line,
Polaris.  Polaris  is  a  multimanager  variable  annuity that offer investors a
choice  of  more  than  25  variable funds and a number of guaranteed fixed-rate
funds.  Variable  Annuity Product Sales have decreased in 2000, principally as a
result  of  regulatory  changes in the State of New York relating to non-taxable
policy  exchange  requirements.

     The  Company  has encountered increased competition in the variable annuity
marketplace  during  recent  years  and  anticipates that the market will remain
highly competitive for the foreseeable future.  Also, from time to time, Federal
initiatives  are  proposed  that could affect the taxation of variable annuities
and  annuities  generally  (See  "Regulation").

     UNIVERSAL LIFE INSURANCE FEES result from the acquisition of universal life
insurance  contract reserves and the ongoing receipt of renewal premiums on such
contracts,  and  comprise  mortality  charges,  up-front fees earned on premiums
received  and  administrative  fees on such contracts.  Universal life insurance
fees  amounted  to  $0.4  million  in  the first three months of 2000. Such fees
annualized  represent  0.7%  of  average  reserves  for universal life insurance
contracts  for 2000.  Since the Acquisition occurred on July 1, 1999, there were
no  such  fees  earned  in  1999.

     SURRENDER  CHARGES  on  fixed  and variable annuity contracts and universal
life contracts totaled $0.8 million in 2000 and $0.6 million in 1999.  Surrender
charges  generally  are  assessed  on  withdrawals at declining rates during the
first  seven years of a contract.  Withdrawal payments, which include surrenders
and  lump-sum  annuity  benefits, totaled $93.2 million in 2000 (including $21.7
million  attributable  to  the  Acquisition)  compared to $41.9 million in 1999.
Annualized,  these  payments  represent  16.4%  (3.8%  attributable  to  the
Acquisition)  and  9.8%  for  2000 and 1999, respectively, of averaged fixed and
variable  annuity  and  universal  life  reserves.  Excluding the effects of the
Acquisition,  withdrawal  payments  represent 14.6% of related average fixed and
variable  annuity reserves in 2000.  The increase in withdrawal rates in 2000 as
compared to 1999 is due primarily  to  increased  surrenders  on  certain closed
blocks  of  business.

                                       11
<PAGE>
Withdrawals  include  variable  annuity  payments  from  the  separate  accounts
totaling  $8.2  million  (5.8%  of  average  variable annuity reserves) and $5.9
million  (6.6%  of  average  variable  annuity  reserves)  in  2000  and  1999,
respectively.  Consistent  with  the  assumptions  used  in  connection with the
Acquisition,  management  anticipates that the level of withdrawal payments will
reflect  higher  relative  withdrawal rates in the near future because of higher
surrenders  on  the  acquired  business.

     GENERAL  AND  ADMINISTRATIVE EXPENSES totaled $1.4 million in 2000 and $1.0
million  in 1999.  The increase in 2000 over 1999 principally reflects increased
costs  related to the business acquired in the Acquisition, and expenses related
to  servicing the Company's growing block of variable annuity policies.  General
and  administrative  expenses  remain  closely controlled through a company-wide
cost containment program and continue to represent less than 1% of average total
assets.

     AMORTIZATION  OF DEFERRED ACQUISITION COSTS totaled $4.8 million (including
$0.1  million  attributable  to  the  Acquisition),  in 2000, compared with $5.1
million  in  1999.

     ANNUAL  COMMISSIONS  represent  renewal  commissions,  including those paid
quarterly  in  arrears  to  maintain the persistency of certain of the Company's
fixed  and  variable  annuity contracts.  Annual commissions totaled $173,000 in
2000  and  $82,000  in  1999.

     INCOME TAX EXPENSE totaled $2.9 million in 2000, compared with $2.7 million
in  1999,  representing  effective  annualized  tax  rates  of  39%  and  41%,
respectively.

FINANCIAL  CONDITION  AND  LIQUIDITY

     SHAREHOLDER'S  EQUITY  decreased  to  $159.1 million at March 31, 2000 from
$161.2 million at December 31, 1999, primarily due to a $6.7 million increase in
accumulated  other  comprehensive  loss  offset  by  $4.5  million of net income
recorded  in  2000.

     INVESTED ASSETS at March 31, 2000 totaled $1.71 billion compared with $1.81
billion  at  December 31, 1999.  The Company manages most of its invested assets
internally.  The  Company's  general investment philosophy is to hold fixed-rate
assets  for  long-term  investment.  Thus, it does not have a trading portfolio.
However, the Company has determined that all of its portfolio of bonds and notes
(the  "Bond Portfolio") is available to be sold in response to changes in market
interest  rates,  changes  in  relative  value  of  asset sectors and individual
securities,  changes  in  prepayment risk, changes in the credit quality outlook
for  certain  securities,  the  Company's  need  for liquidity and other similar
factors.

     THE BOND PORTFOLIO, which constituted 82% of the Company's total investment
portfolio  at  March  31,  2000,  had  an  amortized cost that was $74.0 million
greater  than  its  aggregate  fair  value  at  March 31, 2000 and $64.2 million
greater than its aggregated fair value at December 31, 1999.  The net unrealized
losses on the Bond Portfolio in 2000 principally reflect the recent increases in
prevailing  interest rates and the corresponding effect on the fair value of the
Bond  Portfolio  at  March  31,  2000.

                                       12
<PAGE>
     At March  31, 2000 the Bond Portfolio included $1.39 billion of bonds rated
by Standard & Poor's Corporation ("S&P"), Moody's Investors Service ("Moody's"),
Duff & Phelps Credit Rating Co. ("DCR"), Fitch Investors Service, L.P. ("Fitch")
or  the  National  Association  of  Insurance  Commissioners ("NAIC"), and $17.4
million  of  bonds rated by the Company pursuant to statutory ratings guidelines
established  by the NAIC.  At March 31, 2000, approximately $1.28 billion of the
Bond  Portfolio  was  investment  grade,  including  $573.1  million  of  U.S.
government/agency  securities  and  mortgage-backed  securities  ("MBSs").

     At March 31, 2000, the Bond Portfolio included $126.7 million of bonds that
were  not investment grade.  These non-investment-grade bonds accounted for 5.0%
of  the  Company's  total  assets  and  7.1%  of  its  invested  assets.

     Non-investment-grade securities generally provide higher yields and involve
greater  risks  than investment-grade securities because their issuers typically
are  more  highly  leveraged  and more vulnerable to adverse economic conditions
than  investment-grade  issuers.  In  addition,  the  trading  market  for these
securities  is  usually  more limited than for investment-grade securities.  The
Company had no material issuer concentrations of non-investment-grade securities
at  March  31,  2000.

     The  table  on  the  following page summarizes the Company's rated bonds by
rating  classification  as  of  March  31,  2000.


                                       13

<PAGE>

<TABLE>
<CAPTION>

                                        RATED BONDS BY RATING CLASSIFICATION
                                               (Dollars in thousands)

                                           Issues  not  rated  by  S&P/Moody's
   Issues  Rated  by  S&P/Moody's/DCR/Fitch     DCR/Fitch,  by  NAIC  Category                                Total
-------------------------------------------    -------------------------------   ----------------------------------
S&P/(Moody's)                     Estimated        NAIC              Estimated               Estimated   Percent of
[DCR] {Fitch}         Amortized        fair    category  Amortized        fair   Amortized        fair     invested
 category (1)              cost       value         (2)       cost       value        cost       value       assets
-------------------  ----------  ----------  ---------  ----------  ----------  ----------  ----------  -----------
<S>                  <C>         <C>         <C>        <C>         <C>         <C>         <C>         <C>
AAA+ to A-
  (A11 to A3)
  [AAA to A-]
  {AAA to A-} . . .  $1,032,296  $  994,474         1   $   49,810  $   48,778  $1,082,106  $1,043,252       58.40%

BBB+ to BBB-
  (Baa1 to Baa3)
  [BBB+ to BBB-]
  {BBB+ to BBB-}. .     174,144     166,929         2       76,112      74,756     250,256     241,685       13.53

BB+ to BB-
  (Ba1 to Ba3)
  [BB+ to BB-]
  {BB+ to BB-}           22,819      15,991         3          ---         ---      22,819      15,991        0.90

B+ to B-
  (B1 to B3)
  [B+ to B-]
  {B+ to B-}. . . .     115,649      99,805         4        8,419       7,881     124,068     107,686        6.03

CCC+ to C
  (Caa to C)
  [CCC]
  {CCC+ to C-}            6,400       3,032         5          ---         ---       6,400       3,032        0.17

CI to D
  [DD]
  {D}                       ---         ---         6           12          12          12          12
                     ----------  ----------             ----------  ----------  ----------  ----------

TOTAL RATED ISSUES.  $1,351,308  $1,280,231             $  134,353  $  131,427  $1,485,661  $1,411,658
                     ==========  ==========             ==========  ==========  ==========  ==========
<FN>

Footnotes  appear  on  the  following  page.
</TABLE>


                                       14
<PAGE>

     Footnotes  to  the  table  of  Rated  Bonds  by  Rating  Classification
     -----------------------------------------------------------------------

(1)     S&P and Fitch rate debt securities in rating categories ranging from AAA
(the  highest) to D (in payment default).  A plus (+) or minus (-) indicates the
debt's  relative  standing within the rating category.  A security rated BBB- or
higher  is considered investment grade.  Moody's rates debt securities in rating
categories ranging from Aaa (the highest) to C (extremely poor prospects of ever
attaining  any  real  investment  standing).  The  number  1,2  or 3 (with 1 the
highest  and  3  the  lowest)  indicates the debt's relative standing within the
rating  category.  A  security  rated  Baa3  or  higher is considered investment
grade.  DCR  rates  debt  securities  in rating categories ranging from AAA (the
highest)  to  DD  (in  payment  default).  A plus (+) or minus (-) indicates the
debt's  relative  standing within the rating category.  A security rated BBB- or
higher  is  considered  investment  grade.  Issues  are categorized based on the
highest of the S&P, Moody's DCR and Fitch ratings if rated by multiple agencies.

(2)     Bonds and short-term promissory instruments are divided into six quality
categories  for NAIC rating purposes, ranging from 1 (highest) to 5 (lowest) for
nondefaulted  bonds  plus  one category, 6, for bonds in or near default.  These
six  categories  correspond  with the S&P/Moody's/DCR/Fitch rating groups listed
above, with categories 1 and 2 considered investment grade.  The NAIC categories
include  $17.4  million  of  assets  that  were rated by the Company pursuant to
applicable  NAIC  rating  guidelines.


                                       15

<PAGE>
     Senior  secured  loans ("Secured Loans") are included in the Bond Portfolio
and  aggregated  $95.1  million  at March 31, 2000.  Secured Loans are senior to
subordinated debt and equity, and are secured by assets of the issuer.  At March
31,  2000,  Secured  Loans  consisted  of  $63.7  million  of  privately  traded
securities  and $31.4 million of publicly traded securities. These Secured Loans
are  composed  of  loans  to borrowers spanning 10 industries, with 27% of these
assets  concentrated  in  utilities and 7% concentrated in technology.  No other
industry  concentration  constituted  more  than  5%  of  these  assets.

     While  the  trading market for the Company's privately traded Secured Loans
is  more  limited  than  for  publicly  traded  issues, management believes that
participation  in  these  transactions  has  enabled  the Company to improve its
investment yield.  As a result of restrictive financial covenants, these Secured
Loans  involve  greater  risk  of  technical  default  than  do  publicly traded
investment-grade securities.  However, management believes that the risk of loss
upon  default  for  these Secured Loans is mitigated by such financial covenants
and  the  collateral  values underlying the Secured Loans. The Company's Secured
Loans  are  rated  by  S&P,  Moody's,  DCR,  Fitch,  the NAIC or by the Company,
pursuant  to  comparable  statutory  ratings guidelines established by the NAIC.

     MORTGAGE LOANS aggregated $208.6 million at March 31, 2000 and consisted of
145  commercial  first  mortgage  loans  with  an  average  loan  balance  of
approximately  $1.4  million, collateralized by properties located in 32 states.
Approximately  41%  of  this  portfolio  was  office,  25%  was  retail, 12% was
industrial,  11%  was multifamily residential and 11% was other types.  At March
31,  2000, approximately 34% of this portfolio was secured by properties located
in  California, approximately 11% by properties located in New York and Michigan
and  no  more than 5% of this portfolio was secured by properties located in any
other  single  state.  At  March  31, 2000, one mortgage loan had an outstanding
balance  of  $10.0  million  or more, which represented approximately 5% of this
portfolio,  and  approximately  35%  of the mortgage loan portfolio consisted of
loans  with  balloon  payments  due before April 1, 2003.  During 2000 and 1999,
loans  delinquent  by more than 90 days, foreclosed loans and restructured loans
have  not  been  significant  in  relation to the total mortgage loan portfolio.

     At  March  31,  2000, approximately 55% of the mortgage loans were seasoned
loans  underwritten to the Company's standards and purchased at or near par from
other financial institutions.  Such loans generally have higher average interest
rates  than  loans  that  could be originated today. The balance of the mortgage
loan  portfolio  has  been  originated  by the Company under strict underwriting
standards.  Commercial  mortgage loans on properties such as offices, hotels and
shopping  centers  generally  represent  a higher level of risk than do mortgage
loans  secured  by  multifamily residences.  This greater risk is due to several
factors,  including the larger size of such loans and the more immediate effects
of general economic conditions on these commercial property types.  However, due
to  the  seasoned nature of the Company's mortgage loan portfolio and its strict
underwriting  standards  utilized,  the  Company  believes that it has prudently
managed  the  risk attributable to its mortgage loan portfolio while maintaining
attractive  yields.


                                       16
<PAGE>
     ASSET-LIABILITY  MATCHING  is utilized by the Company to minimize the risks
of  interest rate fluctuations and disintermediation.  The Company believes that
its  fixed-rate liabilities should be backed by a portfolio principally composed
of  fixed-rate  investments  that  generate  predictable  rates  of return.  The
Company  does  not have a specific target rate of return.  Instead, its rates of
return  vary  over  time depending on the current interest rate environment, the
slope  of the yield curve, the spread at which fixed-rate investments are priced
over  the  yield  curve,  default  rates,  and general economic conditions.  Its
portfolio  strategy is constructed with a view to achieve adequate risk-adjusted
returns  consistent  with its investment objectives of effective asset-liability
matching,  liquidity  and safety.  The Company's fixed-rate products incorporate
surrender  charges  or  other  restrictions  in  order to encourage persistency.
Approximately 81% of the Company's fixed annuity and universal life reserves had
surrender  penalties  or  other  restrictions  at  March  31,  2000.

     As  part  of  its asset-liability matching discipline, the Company conducts
detailed  computer  simulations that model its fixed-rate assets and liabilities
under  commonly  used  stress-test interest rate scenarios.  With the results of
these  computer  simulations, the Company can measure the potential gain or loss
in fair value of its interest-rate sensitive instruments and seek to protect its
economic  value  and  achieve  a predictable spread between what it earns on its
invested  assets and what it pays on its liabilities by designing its fixed-rate
products  and conducting its investment operations to closely match the duration
of  the  fixed-rate assets to that of its fixed-rate liabilities.  The Company's
fixed-rate  assets  include:  cash  and short-term investments; bonds and notes;
and mortgage loans.  At March 31, 2000, these assets had an aggregate fair value
of  $1.68  billion with a duration of 3.8.  The Company's fixed-rate liabilities
are  its  fixed  annuity  and  universal life insurance contracts.  At March 31,
2000,  these  liabilities had an aggregate fair value (determined by discounting
future  contractual  cash  flows  by  related market rates of interest) of $1.58
billion  with  a  duration  of  3.6.  The  Company's potential exposure due to a
relative  10%  increase  in  prevailing interest rates from their March 31, 2000
levels  is a loss of approximately $3.6 million, representing an increase in the
fair  value  of  its fixed-rate liabilities that is not offset by an increase in
the  fair  value of its fixed-rate assets.  Because the Company actively manages
its  assets and liabilities and has strategies in place to minimize its exposure
to  loss  as interest rate changes occur, it expects that actual losses would be
less  than  the  estimated  potential  loss.

     Duration is a common option-adjusted measure for the price sensitivity of a
fixed-maturity  portfolio  to  changes  in  interest  rates.  It  measures  the
approximate  percentage  change  in  the market value of a portfolio if interest
rates  change  by  100  basis  points,  recognizing  the  changes  in cash flows
resulting  from  embedded  options  such  as  policy  surrenders,  investment
prepayments  and  bond  calls.  It  also  incorporates  the  assumption that the
Company  will  continue  to utilize its existing strategies of pricing its fixed
annuity  products,  allocating  its  available  cash  flow  amongst  its various
investment  portfolio  sectors  and  maintaining sufficient levels of liquidity.
Because  the  calculation  of  duration  involves  estimation  and  incorporates
assumptions,  potential changes in portfolio value indicated by the  portfolio's
duration  will  likely  be  different  from  the  actual  changes

                                       17

<PAGE>
experienced  under  given  interest  rate  scenarios, and the differences may be
material.

     The  Company  also  seeks  to  provide liquidity from time to time by using
reverse  repurchase  agreements  ("Reverse Repos"), and by investing in MBSs. It
also  seeks  to enhance its spread income by using Reverse Repos.  Reverse Repos
involve  a sale of securities and an agreement to repurchase the same securities
at  a  later date at an agreed upon price and are generally over-collateralized.
MBSs  are generally investment-grade securities collateralized by large pools of
mortgage  loans.  MBSs generally pay principal and interest monthly.  The amount
of  principal  and interest payments may fluctuate as a result of prepayments of
the  underlying  mortgage  loans.

     There  are risks associated with some of the techniques the Company uses to
provide  liquidity,  enhance  its  spread  income  and  match  its  assets  and
liabilities.  The  primary  risk  associated with the Company's Reverse Repos is
counterparty  risk.  The  Company  believes, however, that the counterparties to
its  Reverse  Repos  are  financially responsible and that the counterparty risk
associated  with those transactions is minimal.  It is the Company's policy that
these  agreements are entered into with counterparties who have a debt rating of
A/A2  or better from both S&P and Moody's.  The Company continually monitors its
credit  exposure  with respect to these agreements.  The primary risk associated
with MBSs is that a changing interest rate environment might cause prepayment of
the  underlying  obligations  at speeds slower or faster than anticipated at the
time of their purchase.  As part of its decision to purchase an MBS, the Company
assesses  the  risk  of  prepayment  by  analyzing  the  security's  projected
performance over an array of interest-rate scenarios.  Once an MBS is purchased,
the  Company  monitors  its actual prepayment experience monthly to reassess the
relative  attractiveness  of  the  security  with  the  intent to maximize total
return.

     INVESTED  ASSETS  EVALUATION  is  routinely  conducted  by  the  Company.
Management  identifies  monthly  those  investments  that  require  additional
monitoring  and  carefully  reviews  the  carrying values of such investments at
least  quarterly to determine whether specific investments should be placed on a
nonaccrual  basis  and  to  determine  declines  in value that may be other than
temporary.  In  making these reviews for bonds, management principally considers
the  adequacy  of  any  collateral,  compliance  with contractual covenants, the
borrower's  recent  financial  performance,  news  reports  and other externally
generated information concerning the creditor's affairs. In the case of publicly
traded  bonds,  management also considers market value quotations, if available.
For  mortgage  loans,  management generally considers information concerning the
mortgaged  property  and,  among other things, factors impacting the current and
expected payment status of the loan and, if available, the current fair value of
the  underlying  collateral.

     The  carrying values of investments that are determined to have declines in
value  that are other than temporary are reduced to net realizable value and, in
the case of bonds, no further accruals of interest are made.  The provisions for
impairment  on  mortgage  loans are based on losses expected by management to be
realized on transfers of mortgage loans to  real  estate, on the disposition and
settlement  of  mortgage  loans  and  on

                                       18
<PAGE>
mortgage  loans that management believes may not be collectible in full. Accrual
of  interest is suspended when principal and interest payments on mortgage loans
are  past  due  more  than  90  days.

     DEFAULTED INVESTMENTS, comprising all investments that are in default as to
the payment of principal or interest, totaled $5.2 million at March 31, 2000 and
constituted  0.3%  of  total  invested  assets.  At  December 31, 1999 defaulted
investments  totaled $1.8 million and constituted 0.1% of total invested assets.

     SOURCES  OF  LIQUIDITY  are readily available to the Company in the form of
the  Company's  existing  portfolio  of cash and short-term investments, Reverse
Repo  capacity on invested assets and, if required, proceeds from invested asset
sales.  At  March  31,  2000,  approximately $1.21 billion of the Company's Bond
Portfolio had an aggregate unrealized loss of $77.1 million, while approximately
$199.2  million  of  the Bond Portfolio had an aggregate unrealized gain of $3.1
million.  In  addition,  the  Company's  investment portfolio currently provides
approximately  $17.6  million  of monthly cash flow from scheduled principal and
interest  payments.  Historically, cash flows from operations and from the sales
of  the  Company's  annuity products have been more than sufficient in amount to
satisfy  the  Company's  liquidity  needs.

     Management  is  aware  that  prevailing  market  interest  rates  may shift
significantly  and  has  strategies  in  place  to  manage either an increase or
decrease  in  prevailing  rates.  In  a  rising  interest  rate environment, the
Company's  average  cost  of funds would increase over time as it prices its new
and  renewing  annuities  to  maintain  a  generally  competitive  market  rate.
Management  would  seek  to  place new funds in investments that were matched in
duration  to,  and  higher  yielding than, the liabilities assumed.  The Company
believes  that liquidity to fund withdrawals would be available through incoming
cash  flow, the sale of short-term or floating-rate instruments or Reverse Repos
on the Company's substantial MBS segment of the Bond Portfolio, thereby avoiding
the  sale  of  fixed-rate  assets  in  an  unfavorable  bond  market.

     In a declining rate environment, the Company's cost of funds would decrease
over  time,  reflecting  lower  interest crediting rates on its fixed annuities.
Should  increased  liquidity  be  required for withdrawals, the Company believes
that  a  significant  portion  of  its investments could be sold without adverse
consequences in light of the general strengthening that would be expected in the
bond  market.

REGULATION

     The  Company,  in  common with other insurers, is subject to regulation and
supervision  by the states and by other jurisdictions in which it does business.
Within the United States, the method of such regulation varies but generally has
its  source  in  statutes  that delegate regulatory and supervisory powers to an
insurance official.  The regulation and supervision relate primarily to approval
of  policy  forms  and  rates,  the  standards  of solvency that must be met and
maintained, including risk based capital measurements, the licensing of insurers
and  their  agents, the nature of and limitations  on  investments, restrictions
on  the  size  of  risks  which  may  be

                                       19
<PAGE>
insured  under  a  single  policy,  deposits  of  securities  for the benefit of
policyholders,  methods  of  accounting, periodic examinations of the affairs of
insurance  companies,  the  form  and  content of reports of financial condition
required  to  be  filed,  and  reserves  for unearned premiums, losses and other
purposes.  In  general,  such  regulation is for the protection of policyholders
rather  than  security  holders.

     Risk  based  capital ("RBC") standards are designed to measure the adequacy
of  an insurer's statutory capital and surplus in relation to the risks inherent
in  its  business.  The RBC standards consist of formulas that establish capital
requirements  relating  to  insurance,  business, asset and interest rate risks.
The  standards  are  intended  to  help  identify  companies  which  are
under-capitalized  and  require  specific  regulatory  actions  in  the event an
insurer's  RBC  is  deficient.  The  RBC formula develops a risk adjusted target
level  of  adjusted statutory capital and surplus by applying certain factors to
various  asset,  premium  and reserve items.  Higher factors are applied to more
risky items and lower factors are applied to less risky items.  Thus, the target
level  of  statutory  surplus varies not only as a result of the insurer's size,
but also on the risk profile of the insurer's operations.  The statutory capital
and  surplus  of  the  Company  exceeded  its RBC requirements by a considerable
margin  as  of  March  31,  2000.

     Federal legislation has been recently enacted allowing combinations between
insurance  companies, banks and other entities.  It is not yet known what effect
this  legislation  will  have on insurance companies.  In addition, from time to
time,  Federal  initiatives  are  proposed  that  could  affect  the  Company's
businesses.  Such  initiatives include employee benefit plan regulations and tax
law  changes affecting the taxation of insurance companies and the tax treatment
of  insurance  and  other investment products. Proposals made in recent years to
limit the tax deferral of annuities or otherwise modify the tax rules related to
the  treatment  of  annuities  have  not  been  enacted.  While  certain of such
proposals,  if  implemented, could have an adverse effect on the Company's sales
of  affected  products,  and,  consequently,  on  its results of operations, the
Company  believes  these  proposals  have  a  small likelihood of being enacted,
because  they would discourage retirement savings and there is strong public and
industry  opposition  to  them.


                                       20
<PAGE>
           QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     The  quantitative  and  qualitative  disclosures  about  market  risk  are
contained in the Asset-Liability Matching section of Management's Discussion and
Analysis  of  Financial  Condition  and Results of Operations on pages 19 and 20
herein.


                                       21

<PAGE>
                           PART II - OTHER INFORMATION

Item  1.     Legal  Proceedings
             ------------------

     Not  applicable.

Item  2.     Changes  in  Securities  and  Use  of  Proceeds
             -----------------------------------------------

     Not  applicable.

Item  3.     Defaults  Upon  Senior  Securities
             ----------------------------------

     Not  applicable.

Item  4.     Submissions  of  Matters  to  a  Vote  of  Security  Holders
             ------------------------------------------------------------

     Not  applicable.

Item  5.     Other  Information
             ------------------

     Not  applicable.

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



EXHIBITS


Exhibit
  No.                    Description
-----                    -----------

 27                Financial  Data  Schedule


REPORTS  ON  FORM  8-K

No  Current  Reports  on  Form  8-K  were  filed by the Company during the first
quarter  ended  March  31,  2000.


                                       22
<PAGE>
                                   SIGNATURES

     Pursuant  to  the  requirements of the Securities and Exchange Act of 1934,
the  Registrant  has  duly  caused this report to be signed on its behalf by the
undersigned,  thereunto  duly  authorized.


                         FIRST  SUNAMERICA  LIFE  INSURANCE  COMPANY
                         -------------------------------------------
                         Registrant



Date:  May  12,  2000     /s/  N.  SCOTT  GILLIS
---------------------     ----------------------
                          N.  Scott  Gillis
                          Senior  Vice  President
                           (Principal  Financial
                            Officer)



Date:  May  12,  2000     /s/  MAURICE  S.  HEBERT
---------------------     ------------------------
                          Maurice  S.  Hebert
                          Vice  President  and
                            Controller  (Principal
                            Accounting  Officer)



                                       23
<PAGE>
                     FIRST SUNAMERICA LIFE INSURANCE COMPANY
                             LIST OF EXHIBITS FILED

Exhibit
  No.                    Description
-----                    -----------

 27               Financial  Data  Schedule.


                                       24