UNITED STATES
                    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. For the quarterly period ended June 30, 1998.

[ ]	Transition report pursuant to Section 13 or 15(d) of the Securities 
   	Exchange Act of 1934. For the transition period from N/A to N/A.

                     Commission file number 333-02491*.

                  KEMPER INVESTORS LIFE INSURANCE COMPANY
            (Exact name of registrant as specified in charter)

                                ILLINOIS
                        (State of Incorporation)

                               36-3050975
                            (I.R.S. Employer
                         Identification Number)

                             1 KEMPER DRIVE
                          LONG GROVE, ILLINOIS
                (Address of Principal Executive Offices)

                               60049-0001
                               (Zip Code)

     Registrant's telephone number, including area code: (847) 550-5500

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     .

As of August 1, 1998, 250,000 shares of common stock (all held by an 
affiliate, Kemper Corporation) were outstanding.  There is no market value for 
any such shares. 

*	Pursuant to Rule 429 under the Securities Act of 1933, this Form 10-Q 
also relates to Commission file numbers 33-33547, 33-43462 and 33-46881.


                                   1

<PAGE>

                 KEMPER INVESTORS LIFE INSURANCE COMPANY
                               FORM 10-Q



PART I.	   FINANCIAL STATEMENTS       						                   PAGE NO.


   Consolidated Balance Sheets - 
       June 30, 1998 and December 31, 1997	..........................3

 		Consolidated Statements of Operations - 
       Six months and three months ended June 30, 1998 and 1997......4

   Consolidated Statements of Comprehensive Income -
       Six months and three months ended June 30, 1998 and 1997......5

   Consolidated Statements of Stockholder's Equity -
       Six months ended June 30, 1998 and 1997.......................6

   Consolidated Statements of Cash Flows -
       Six months ended June 30, 1998 and 1997.......................7
 

   Notes to Consolidated Financial Statements........................8


   Management's Discussion and Analysis
       Results of Operations........................................10
       Investments..................................................14
       Liquidity and Capital Resources..............................19



PART II.	  OTHER INFORMATION


   ITEM 6.  Exhibits and Reports on Form 8-K........................20


   Signatures.......................................................21


                                   2

<PAGE>
<TABLE>
Kemper Investors Life Insurance Company and Subsidiaries
Consolidated Balance Sheets
(in thousands, except share data)
(unaudited)
<CAPTION>
                                                    	June 30	   	December 31
                                                    	 1998	          1997
                                                   	----------	  -----------
<S>                                                 <C>           <C>
ASSETS
Investments:
  Fixed maturities, available for sale, at 
    market (cost: June 30, 1998, $3,550,377;
	     December 31, 1997, $3,644,075)	               $3,591,991	   $3,668,643
  Short-term investments	                               41,806      	236,057
  Joint venture mortgage loans	                         67,868       	72,663
  Third-party mortgage loans	                          104,206	      102,974
  Other real estate-related investments	                41,891	       44,409
  Policy loans	                                        277,034	      282,439
  Equity securities	                                    75,341	       24,839
  Other invested assets	                                21,264	       20,820
                                                   	----------	   ----------
  Total investments	                                 4,221,401	    4,452,844

Cash	                                                   20,785	       23,868
Accrued investment income	                             121,452	      117,789
Goodwill	                                              223,023	      229,393
Value of business acquired	                            124,780	      138,482
Deferred insurance acquisition costs	                   78,420	       59,459
Deferred income taxes	                                  48,819       	39,993
Reinsurance recoverable	                               361,172	      382,609
Other assets and receivables	                           18,562       	23,263
Assets held in separate accounts	                    5,941,104	    5,121,950
                                                   	----------   	----------
  Total assets	                                    $11,159,518	  $10,589,650
                                                   	==========	   ==========	
	
LIABILITIES AND STOCKHOLDER'S EQUITY
Future policy benefits	                             $3,662,012	   $3,856,871
Ceded future policy benefits	                          361,172	      382,609
Benefits and funds payable	                            245,884	      150,524
Other accounts payable and liabilities	                 49,694	      212,133
Liabilities related to separate accounts	            5,941,104	    5,121,950
                                                  		----------	   ----------
  Total liabilities	                                10,259,866	    9,724,087
                                                   	----------	   ----------
Commitments and contingent liabilities

Stockholder's equity: 		
Capital stock - $10 par value, authorized 
	 300,000 shares; outstanding 250,000 shares	            2,500	        2,500
Additional paid-in capital	                            806,538	      806,538
Accumulated other comprehensive income                 	21,609	       12,637
Retained earnings	                                      69,005	       43,888
                                                  		----------   	----------
  Total stockholder's equity                          	899,652	      865,563
                                                   	----------	   ----------
  Total liabilities and stockholder's equity	      $11,159,518 	 $10,589,650
                                                   	==========	   ==========	

See accompanying notes to consolidated financial statements.
</TABLE>
                                   3

<PAGE>
<TABLE>
Kemper Investors Life Insurance Company and Subsidiaries
Consolidated Statements of Operations
(in thousands)
(unaudited)
<CAPTION>
                                      	Six Months Ended	   Three Months Ended
                                        			June 30	              June 30
                                       	---------------     ---------------- 
       				
                                       	 1998  	  1997	      1998	     1997
                                        	----	    ----      	----	     ----	
<S>                                 <C>       <C>         <C>       <C>
REVENUE	
Net investment income	              $ 139,018	$ 148,299  	$ 68,467	 $ 74,050
Realized investment gains 	            17,527	    9,050	    15,673    	8,161
Premium income	                        11,144	    9,129	     5,941	    4,121
Separate account fees and charges	     34,380	   16,827	    16,388    	9,510
Other income	                           5,960	    5,043	     3,534    	3,451
                                     	-------	 	-------   	-------	  -------
  Total revenue	                      208,029  	188,348	   110,003   	99,293
                                    		-------	 	-------   	-------  	-------

BENEFITS AND EXPENSES		
Interest credited to policyholders	    90,169	  101,886    	44,479   	50,365
Claims and other policyholder
  benefits	                            25,700	   12,616	    13,460	    6,278
Taxes, licenses and fees	               9,758	    3,064	     3,082	    2,488
Commissions	                           18,049	   14,434	    10,840	    6,987
Operating expenses	                    22,253   	15,955    	12,157    	8,780
Deferral of insurance
  acquisition costs	                  (21,600) 	(15,790)	  (12,710)	  (7,688)
Amortization of insurance
  acquisition costs	                    1,644	    1,697	       727	      811
Amortization of value of
  business acquired	                   11,548	   11,812	     7,121	    6,991
Amortization of goodwill	               6,370	    5,099	     3,186	    2,552
                                     	-------	  -------	   -------	  -------
		
  Total benefits and expenses	        163,891	  150,773	    82,342	   77,564
			 	
                                     	-------	  -------	   -------	  -------
			
Income before income tax expense	      44,138	   37,575    	27,661   	21,729
		
			
Income tax expense (benefit)	
  Current	                             32,679	   16,028	    19,011	   10,577
  Deferred	                           (13,658)  	(1,627)	   (7,237)  	(1,854)
                                     	-------	  -------   	-------  	-------
  Total income tax expense	            19,021	   14,401	    11,774	    8,723
                                     	-------	  -------	   -------	  -------
	
Net income	                         $  25,117  $ 23,174	  $ 15,887	 $ 13,006
                                     	=======	  =======	   =======	  =======
		

See accompanying notes to consolidated financial statements.
</TABLE>
					
                                   4	        	 		

<PAGE>
<TABLE>
Kemper Investors Life Insurance Company and Subsidiaries
Consolidated Statements of Comprehensive Income 
(in thousands)
(unaudited)
<CAPTION>
 	                                     Six Months Ended  	Three Months Ended
                                         	 June 30             	June 30
	                                    -------------------  -------------------
                                      	1998	       1997	    1998	       1997
                                     	-----    	  ----- 	  -----	      -----
<S>                                 <C>        <C>       <C>       <C>
Net income 	                        $ 25,117   $ 23,174	 $ 15,887	  $ 13,006
Other comprehensive income (loss),
 before tax:		 
  Unrealized holding gains (losses)
   on investments arising during
   period:
   	Unrealized holding gains
     (losses) on investments	         10,522	    (6,178)	  10,246    	64,826
   	Adjustment to value of business
     acquired	                        (5,487)  	(14,602)	  (5,181)    	2,914
   	Adjustment to deferred insurance
     acquisition costs	               (1,855)   	(1,057)  	(1,367)       	41
                         										   -------    -------   -------	   ------
	
      Total unrealized holding gains
       (losses) on investments arising
       during period	                  3,180   	(21,837)   	3,698    	67,781
                         											  -------    -------   -------	  -------
Less reclassification adjustments
 for gains(losses) included in net
 income on the preceding page:
  Adjustment for gains included in
   realized	investment gains         	(2,421)     	(978)	  (1,742)  	 (1,003)
  Adjustment for amortization of
   premium on fixed maturities
   included in net investment income  	8,851	     8,997    	4,175	     4,232
  Adjustment for gains included in
   amortization of value of business
   acquired                           	3,333     	2,454    	2,978     	2,223
  Adjustment for gains included in
   amortization of insurance
   acquisition costs	                    860	       412      	769	       381
    Total reclassification
     adjustments for              		  -------    -------   -------	  -------
    	gains included in net income    	10,623	    10,885    	6,180     	5,833
                                      -------    -------   -------	  -------
	

Other comprehensive income (loss),
 before related income tax expense
 (benefit)                           	13,803   	(10,952)   	9,878    	73,614

Related income tax expense (benefit) 	 4,831	    (4,477)   	3,457     	1,945
                        						 					  -------    -------   -------	  -------
	
Other comprehensive income (loss),
 net of tax                           	8,972    	(6,475)	   6,421    	71,669
                       				  							  -------    -------   -------    ------
	
Comprehensive income	               $ 34,089   $ 16,699 	$ 22,308	  $ 84,675	
                                 			  =======    =======   =======	  =======

See accompanying notes to consolidated financial statements.
</TABLE>
                                   5

<PAGE>
<TABLE>
Kemper Investors Life Insurance Company and Subsidiaries
Consolidated Statements of Stockholder's Equity
(in thousands)
(unaudited)
<CAPTION>  
                                                    June 30      December 31
                                                    	1998	          1997
                                                  		-------	       -------
<S>                                                 <C>            <C>
Capital stock, beginning and end of period	         $ 2,500	       $ 2,500
  													                                     --------	      --------

Additional paid-in capital, beginning of period	   	806,538	       761,538
Capital contributions from Parent	                        -	        45,000
                                        										 --------	      --------
			        End of period		                          806,538       	806,538
										                                         --------	      --------

Accumulated other comprehensive income,
 beginning of period	                                12,637	       (47,498)
Other comprehensive income, net of tax               	8,972	        60,135
                            													          --------	      --------
		         End of period	                            21,609	        12,637
                                      												 --------	      --------

Retained earnings, beginning of period	              43,888        	34,421
Net income	                                          25,117        	38,717
Dividend to parent	                                       -	       (29,250)
												                                       --------	      --------
		         End of period                            	69,005        	43,888
										                                         --------  	    --------

	 Total stockholder's equity                      	$899,652	      $865,563
										                                         ========	      ========	
                                                  	 
 
See accompanying notes to consolidated financial statements.
</TABLE>
                                   6

<PAGE>
<TABLE>
Kemper Investors Life Insurance Company and Subsidiaries
Consolidated Statements of Cash Flows
(in thousands)
(unaudited) 
<CAPTION>
                                                           Six Months Ended 
                                                            			June 30
                                                         		-----------------
		
	                                                           1998       1997	 
                                                          	------	    ------ 	
<S>                                                      <C>        <C>
Cash flows from operating activities
  Net income	                                            $ 25,117	  $ 23,174
  Reconcilement of net income to net cash provided:
    Realized investment gains	                            (17,527)   	(9,050)
    Interest credited and other charges	                   88,303   	101,886
    Amortization of value of business acquired	            11,548	    11,812
    Amortization of goodwill                               	6,370	     5,099
    Deferred insurance acquisition costs	                 (19,956)  	(14,093)
    Amortization of discount and premium on investments    	8,851	     8,997
    Deferred income taxes	                                (13,658)   	(1,627)
    Net change in current Federal income taxes	           (97,823)    	3,840
    Benefits and premium taxes due related to separate
     account bank-owned life insurance                    	40,163         	- 
    Other, net	                                           (21,795)   	11,495
                                                         	-------	 	--------
    Net cash flow provided by operating activities	         9,593	   141,533
                                                         	-------	 	--------

Cash flows from investing activities
  Cash from investments sold or matured:
    Fixed maturities held to maturity	                    258,237   	104,154
    Fixed maturities sold prior to maturity	              505,188	   209,569
    Equity securities	                                        460         	-
    Mortgage loans, policy loans and other invested
     assets	                                               54,780   	117,093
  Cost of investments purchased or loans originated:
    Fixed maturities	                                    (675,192) 	(229,921)
    Equity securities	                                    (48,585)	        -
    Mortgage loans, policy loans and other invested
     assets	                                              (26,951)  	(76,014)
  Short-term investments, net	                            194,251    	62,729
  Net change in receivable and payable for securities		
   transactions	                                             (677)	   13,677
  Net change in other assets	                                   -	       114
                                                        	--------  	--------
    Net cash provided by investing activities	            261,511	   201,401
                                                        	--------  	--------
Cash flows from financing activities
  Policyholder account balances:
    Deposits	                                              72,626    	67,412
    Withdrawals                                         	(356,177) 	(343,675)
  Dividends to parent	                                          -    (29,250)
  Other	                                                    9,364	   (37,834)
                                                        	--------  	--------
    Net cash used in financing activities	               (274,187)	 (343,347)
                                                     	   --------	  --------
Net decrease in cash	                                      (3,083)     	(413)
Cash at the beginning of period	                           23,868     	2,776
                                                        	--------	  --------
Cash at the end of the period	                           $ 20,785  	$  2,363
                                                        	========  	========

See accompanying notes to consolidated financial statements.
</TABLE>
 	   
                                   7

<PAGE>

Kemper Investors Life Insurance Company and Subsidiaries 
Notes to Consolidated Financial Statements (unaudited)

1.  Kemper Investors Life Insurance Company ("KILICO") is incorporated under 
    the insurance laws of the State of Illinois.  KILICO is licensed in the 
    District of Columbia and all states, except New York. KILICO is a wholly-
    owned subsidiary of Kemper Corporation ("Kemper"), a nonoperating holding 
    company.

    On January 4, 1996, an investor group comprised of Zurich Insurance 
    Company("Zurich"), and Insurance Partners, L.P. ("Insurance Partners") 
    acquired all of the issued and outstanding common stock of Kemper.  As a 
    result of the change in control, Zurich and Insurance Partners owned 80 
    percent and 20 percent, respectively, of Kemper and therefore KILICO. On 
    February 27, 1998, Zurich acquired Insurance Partner's remaining 20 percent 
    interest for cash.  As a result of this transaction, Kemper and KILICO 
    became wholly-owned subsidiaries of Zurich.

    The acquisition of Kemper on January 4, 1996 was accounted for using the 
    purchase method of accounting.  Under the purchase method of accounting, 
    KILICO's assets and liabilities have been marked to their relative fair 
    values as of the acquisition date.  The difference between the cost of 
    acquiring KILICO and the net fair values of KILICO's assets and liabilities 
    as of the acquisition date has been recorded as goodwill.  KILICO began to 
    amortize goodwill during 1996 on a straight-line basis over twenty-five 
    years.  In December of 1997, KILICO changed its amortization period to 
    twenty years in order to conform to Zurich's accounting practices and 
    policies. 

    Deferred insurance acquisition costs, and the related amortization thereof, 
    for policies sold prior to January 4, 1996 have been replaced by the value 
    of business acquired.  

    The value of business acquired reflects the estimated fair value of 
    KILICO's life insurance business in force and represents the portion of the 
    cost to acquire KILICO that is allocated to the value of the right to 
    receive future cash flows from insurance contracts existing at the date of 
    acquisition.  Such value is the present value of the actuarially determined 
    projected cash flows for the acquired policies.

                                   8

<PAGE>

    The value of the business acquired is amortized over the estimated contract
    life of the business acquired in relation to the present value of estimated
    gross profits using current assumptions based on an interest rate equal to
    the liability or contract rate on the value of business acquired.  The
    estimated amortization and accretion of interest for the value of
    business acquired for each of the years through December 31, 2003 are as
    follows:

<TABLE>
    (in thousands)
<CAPTION>
 			                                                            		 Projected 
 	  Year ended     Beginning                   		Accretion of 	     ending
    December 31	   balance	     Amortization     	 interest         balance
    -----------	   ----------	  ------------    	-----------	     ----------
    <S>            <C>           <C>              <C>             <C>
    1998	          $  143,744	   $(31,301)       	$  8,877	       $ 121,320
    1999	             121,320	    (23,621)	          7,889	         105,588 
    2000          	   105,588     (21,587)	          6,899       	   90,900
    2001	              90,900	    (19,100)          	5,995	          77,795		
   	2002	              77,795	    (17,820)	          5,157       	   65,132
    2003              	65,132	    (15,897)          	4,364	          53,599
</TABLE>

    The projected ending balance of the value of business acquired will be
    further adjusted to reflect the impact of unrealized gains or losses on
    fixed maturities held as available for sale in the investment portfolio.
    Such adjustments are not recorded in KILICO's net income but rather are
    recorded as a credit or charge to accumulated other comprehensive income,
    net of income tax. As of June 30, 1998, the accumulated affects of this
    adjustment increased the value of business acquired and accumulated other
    comprehensive income by approximately $7.4 million and $4.8 million,
    respectively.
 
2.	 In the opinion of management, all necessary adjustments consisting of
    normal recurring accruals have been made for a fair statement of the
   	results of KILICO for the periods included in these financial statements.
   	These financial statements should be read in conjunction with the 
   	financial statements and related notes in the 1997 Annual Report on Form
    10-K/A No. 1.

3.	 In June 1997, the Financial Accounting Standards Board ("FASB")issued
    Statement	of Financial Accounting Standards ("SFAS") No. 130, Reporting
    Comprehensive Income. SFAS No. 130 establishes standards for reporting and
    display of comprehensive income and its components (revenues, expenses,
    gains and losses). This statement requires that all items required to be
    reported be displayed with the same prominence as other financial
    statements. KILICO adopted SFAS No. 130 on January 1, 1998 and accordingly
    restated 97 	results for comparative purposes. The impact of
    implementation did not affect KILICO's reported net income before
    reporting other comprehensive income. Other comprehensive 	income,
    however, by design, could be materially different from reported net
    income, as changes in unrealized appreciation and depreciation of
    investments for example are now included as a component of reported
    comprehensive income.

4.	 During December 1997, KILICO entered into a funds held reinsurance
    agreement with a Zurich affiliated company, EPICENTRE Reinsurance
    (Bermuda) Limited("EPICENTRE"). Under the terms of this agreement, KILICO
    ceded, on a yearly renewable term basis, ninety percent of the net amount
    at risk (death benefit payable to the insured less the insured's separate
    account cash surrender value) related to a non-registered variable
    bank-owned life insurance contract ("BOLI"), which is held in KILICO's
    separate accounts.  During the first quarter of 1998, KILICO ceded to
    EPICENTRE approximately $77.3 million of separate account fees (cost of
    insurance charges) paid to KILICO by these policyholders for the life
    insurance coverage provided under the terms of each separate account
    contract. KILICO has also withheld approximately $95.3 million of such 
    funds due to EPICENTRE under the terms of the reinsurance agreement as a
    component of benefits and funds payable in the accompanying consolidated
    balance sheet as of June 30, 1998. KILICO remains primarily liable to its
    policyholders for these amounts.

                                   9

<PAGE>

MANAGEMENT'S DISCUSSION AND ANALYSIS


RESULTS OF OPERATIONS

KILICO recorded net income of $25.1 million in the first six months of 1998, 
compared with net income of $23.2 million in the first six months of 1997.  The 
increase in net income in the first six months of 1998, compared with the first 
six months of 1997, was primarily related to an increase in realized capital 
gains, partially offset by a decrease in operating earnings before amortization 
of goodwill and an increase in goodwill amortization.

The following table reflects the components of net income:
<TABLE>
Net income:
(in millions)
<CAPTION>
                                                       	Six months ended
                                                 									  June 30
                                                       ------------------	
                                                      	 1998        1997	
                                                        ----   	    ----
<S>                                                   <C>         <C>
Operating earnings before amortization of goodwill	   $ 20.1     	$ 22.4
Amortization of goodwill	                               (6.4)      	(5.1)
Net realized capital gains                             	11.4  	      5.9 
                                                        ----        ----
 	Net income                                         	$ 25.1     	$ 23.2 
                                                       =====    	  ===== 
</TABLE>
	
The following table reflects the major components of net realized capital gains 
included in net income. (See "INVESTMENTS" below.)

<TABLE>
Net realized capital gains (losses)
(in millions)
<CAPTION>
		                                     Six months ended  	Three months ended 
                                          	June 30            		June 30
                                     	----------------- 	-------------------

                                       1998       1997    1998         1997	
                                       ----       ----    ----         ----
<S>                                   <C>        <C>     <C>         <C>
Real estate-related gains 	           $ 10.5	    $ 9.3  	$  9.9	     $  7.7
Fixed maturity write-downs                 -	     (1.0)       -           -
Other gains, net	                        7.0	       .8	     5.7         	.5
                                        ----      ----    	----       	----
Realized investment gains	              17.5	      9.1    	15.6        	8.2
Income tax expense	                      6.1      	3.2	     5.4       	 2.9
                                        ----      ----    	----    	   ----
Net realized capital gains 	          $ 11.4	    $ 5.9  	$ 10.2     	$  5.3
	                                      =====	    =====  	  ====     	  ====
</TABLE>
			
Operating earnings before amortization of goodwill decreased to $20.1 million
in the first six months of 1998, compared with $22.4 million in the first six
months of 1997. This decrease was primarily attributable to increases in claims
and nondeferrable operating expenses, partially offset by increases in fees and
other income and spread revenue (investment income earned, less interest
credited incurred).

Spread revenue improved during 1998, due to a net decrease in interest
credited. Interest credited declined during 1998 due to crediting rate
reductions and a decrease in the liability for future policy benefits.
Investment income declined due to a decrease in invested assets.  Invested
assets and the liability for future policy benefits both declined due to
surrenders and withdrawals during 1997 and 1998.  Investment income in 1998,
compared with 1997, was positively impacted by a $45.0 million capital
contribution received by KILICO in December 1997.

                                  10

<PAGE>
<TABLE>
Sales
(in millions)
<CAPTION>
	                                       Six Months Ended	 Three Months Ended
                                           	June 30            	June 30
                                      	------------------ ------------------
                                        	1998     	1997	   	1998     	1997
                                       	------	   ------  	------   	------
<S>                                    <C>       <C>      <C>       <C>
Annuities:
  General account	                     $  71.9	  $  67.2	 $  35.4 	 $  33.3
  Separate account	                      128.3    	133.1	    67.7	     61.7
                                        	-----	    -----   	-----    	-----
    Total annuities	                     200.2    	200.3	   103.1	    	95.0
                                        	-----	    -----	   -----    	-----
Life insurance:	
 	Separate account bank-owned life
   insurance                            	422.7     	80.0    264.0     	80.0
 	Separate account variable universal
   life insurance	                         6.8       	.6	     5.6       	.6
  Term life	                              11.1     	 9.0     	6.1      	4.0
	 Interest-sensitive life	                  .1       	.2       	-      	(.2)
                                      	 	-----    	-----	   -----    	-----
Total life	                              440.7     	89.8	   275.7     	84.4
	                                       	-----	    -----	   -----    	-----
Total sales	                           $ 640.9	    290.1 	$ 378.8 	$  179.4
                                        	=====	    =====   	=====    	=====
</TABLE>

Sales of annuity products consist of total deposits received. Sales of variable 
annuities increase administrative fees earned, and they  pose minimal
investment risk for KILICO, as policyholders invest in one or more of several
underlying investment funds which invest in stocks and bonds.  

General account fixed annuity sales increased $4.7 million in the first six
months of 1998, compared with the first six months of 1997, while separate
account variable annuity sales decreased $4.8 million in the first six months
of 1998, compared with the first six months of 1997.  Separate account
annuity sales declined during the first six months of 1998, compared with 1997,
as a result of a transition in KILICO's sales initiatives in certain markets,
as well as from certain tax proposals, which had negatively impacted KILICO's
sales in certain markets during the first part of 1998.

During late 1996, KILICO introduced a registered flexible individual variable
life insurance product and in mid 1997 KILICO began to introduce several
non-registered variable universal life insurance contracts, a variable
individual and group bank-owned life insurance contract ("BOLI") and a series
of variable individual universal life insurance contracts.  Sales of these
separate account variable products, like variable annuities, pose minimal
investment risk for KILICO as policyholders also invest in one or more
underlying investment funds which invest in stocks and bonds. KILICO receives
premium tax and DAC tax expense loads from certain contract holders, as well
as administrative fees and cost of insurance charges which compensate KILICO
for providing life insurance coverage to the contractholders in excess of
their cash surrender values.  Face amount of variable universal life insurance
business in force, before reinsurance, amounted to $61.0 billion at June 30,
1998, compared with $59.6 billion at December 31, 1997 and $2.0 billion at
June 30, 1997. 


KILICO also sells low-cost term life insurance products offering initial level
premiums for 5, 10, 15, 20, and 30 years in order to balance its product mix
and asset-liability structure.  In December 1996, KILICO assumed $14.4 billion
(face amount) of term life insurance premiums from Federal Kemper Life
Assurance Company ("FKLA"), a wholly-owned subsidiary of Kemper.  Through the
first six months of 1998 and 1997, KILICO assumed premiums of $10.7 million and
$8.7 million, respectively, and $10.7 million and $8.0 million of claims,
respectively, under the terms of the reinsurance agreement with FKLA. 

Excluding the amounts assumed from FKLA, KILICO's total term life sales,
including new and renewal premiums, amounted to $449 thousand in the first
six months of 1998, compared with $280 thousand in the first six months of
1997.

                                   11

<PAGE>

Separate account fees and charges consist of the following as of June 30, 1998
and 1997:
<TABLE>
(in millions)
<CAPTION>
                                       	Six Months Ended	 Three Months Ended
                                           	June 30            	June 30
                                       	---------------- 	------------------
                                       	 1998	     1997	     1998	     1997
                                       	-----	     -----    -----     	-----
   <S>                                  <C>       <C>      <C>        <C>
  	Separate account fees on non-BOLI 				
	   variable life and annuities	        $ 18.9	   $ 14.4	   $ 9.4	    $ 7.1
  	BOLI cost of insurance charges and
    fees	                                  9.4<F1>    .4     	5.1	       .4
	  BOLI premium tax expense loads	         6.1<F2>  	2.0   	  1.9	      2.0
                                       		-----    	-----    -----    	-----
		   Total	                             $ 34.4	   $ 16.8	  $ 16.4    	$ 9.5
                                       	====== 	  ======  	======	   ======
-------------------
<FN>
<F1> KILICO ceded $77.3 million of such charges to EPICENTRE during 1998.
<F2> There is a corresponding offset in taxes, licenses and fees.
<F3> No commissions were paid on BOLI.
</FN>
</TABLE>

Separate account fees on non-BOLI variable life and annuities increased 
during the first half of 1998, compared with 1997, due to an increase in 
the market value of separate account assets and due to new sales during 
1997 and 1998.

<TABLE>
Policyholder surrenders, withdrawals and death benefits were as follows:
(in millions)	
<CAPTION>
	                                      Six Months Ended	  Three Months Ended
                                          	June 30	             June 30
                                      	-----------------	 -----------------
                                        	1998	     1997	    1998	     1997
                                      	 -----	     -----	  -----	     -----
<S>                                   <C>        <C>      <C>       <C>
General account	                      $  352.2	  $ 326.0 	$ 173.7	  $ 179.8
Separate account	                        127.4	    110.1	    66.6	     48.9
                                       	------	   ------  	------	   ------
Total	                                $  479.6	 	$ 436.1	 $ 240.3	  $ 228.7
                                       	======	   ======	  ======   	======	
</TABLE>
				 

Reflecting the current interest rate environment and other competitive 
market factors, KILICO adjusts its crediting rates on interest-sensitive 
products over time in order to manage spread revenue and policyholder 
surrender and withdrawal activity.  KILICO can also improve spread revenue 
over time by increasing investment income.

General account surrenders, withdrawals and death benefits increased $26.2 
million in the first six months of 1998, compared with the first six 
months of 1997, reflecting an increase in claims as well as an increase in 
overall surrenders and withdrawals.  KILICO expects that the level of 
surrender and withdrawal activity experienced in the first six months of 
1998 should remain at a similar level through out 1998 given current 
projections for relatively stable interest rates.

Claims and other policyholder benefits increased $13.1 million in the 
first six months of 1998, compared with 1997, primarily due to BOLI-
related claims and benefits.

Taxes, licenses and fees increased during the first six months of 1998, 
compared with 1997, primarily relecting premium taxes on BOLI. KILICO 
received a corresponding expense load related to these premium taxes in 
separate account fees and other charges during the first six months of 
1998.

                                   12

<PAGE>

Commissions and the deferral of insurance acquisition costs increased 
reflecting the overall increase in new business during 1998, compared with 
1997.

Operating expenses increased $6.3 million in the first six months of 1998, 
compared with first six months of 1997, due to increases in head count in 
the sales and underwriting departments, an increase in data processing 
expenses related to ongoing projects, new product development and year 
2000 compliance costs.

The difference between the cost of acquiring KILICO and the net fair value 
of KILICO's assets and liabilities as of January 4, 1996 was recorded as 
goodwill. As previously mentioned, KILICO changed its amortization period 
in December of 1997, from 25 years to 20 years, in order to conform to 
Zurich's accounting practices and policies.  As a result of the change in 
amortization periods, KILICO recorded an increase in amortization expense 
of $1.3 million in the first six months of 1998, compared with 1997.


                                   13

<PAGE>

INVESTMENTS

KILICO's principal investment strategy is to maintain a balanced, 
well-diversified portfolio supporting the insurance contracts written.  
KILICO makes shifts in its investment portfolio depending on, among 
other factors, its evaluation of risk and return in various markets, 
consistency with KILICO's business strategy and investment guidelines 
approved by the board of directors, the interest rate environment, 
liability durations and changes in market and business conditions.  

<TABLE>
Invested assets and cash
(in millions)
<CAPTION>
		                                         June 30, 1998  	December 31, 1997
		                                         -------------- 	-----------------
<S>                                        <C>    <C>       <C>      <C>
Cash and short-term investments	            $	63    1.5%   	$  260	    5.8%
Fixed maturities:
  Investment grade:
    NAIC <F1> Class 1                     	2,853  	67.3	     3,004   	67.1
    NAIC <F1> Class 2                       	683	  16.1	       651	   14.5
  Below investment grade:
    Performing	                               56	   1.3        	14	     .3
    Nonperforming                             	-     	-	         -	      -
Joint venture mortgage loans	                 68   	1.6        	73    	1.6
Third-party mortgage loans	                  104   	2.5	       103	    2.3
Other real estate-related investments	        42   	1.0        	44    	1.0
Policy loans                                	277   	6.5       	282	    6.3
Equity securities	                            75   	1.8        	25	     .6
Other	                                       	21    	.4	        21     	.5
                                          	-----  -----     	-----  	-----
    Total	                                $4,242 	100.0%  	 $4,477	  100.0%
                                          	===== 	=====	     =====  	=====
  __________________________________________________________
<FN>
 <F1>	National Association of Insurance Commissioners ("NAIC").
	     --  Class 1 = A- and above
     	--  Class 2 = BBB- through BBB+
</FN>
</TABLE>

Fixed maturities

KILICO is carrying its fixed maturity investment portfolio, which it 
considers available for sale, at estimated fair value, with the aggregate 
unrealized appreciation or depreciation being recorded as a component of 
accumulated other comprehensive income, net of any applicable income tax 
expense.  The aggregate unrealized appreciation on fixed maturities at June 
30, 1998 was $41.6 million, compared with $24.6 million at December 31, 
1997.  Fair values are sensitive to movements in interest rates and other 
economic developments and can be expected to fluctuate, at times 
significantly, from period to period. 

At June 30, 1998, investment-grade fixed maturities and cash and short-term 
investments accounted for 84.9 percent of KILICO's invested assets and 
cash, compared with 87.4 percent at December 31, 1997.

Approximately 31.6 percent of KILICO's investment-grade fixed maturities at 
June 30, 1998 were mortgage-backed securities, down from 35.1 percent at 
December 31, 1997, due to sales and paydowns during 1998. These investments 
consist primarily of marketable mortgage pass-through securities issued by 
the Government National Mortgage Association, the Federal National Mortgage 
Association or the Federal Home Loan Mortgage Corporation and other 
investment-grade securities collateralized by mortgage pass-through 
securities issued by these entities.  KILICO has not made any investments 
in interest-only or other similarly volatile tranches of mortgage-backed 
securities.  KILICO's mortgage-backed investments are generally of AAA 
credit quality, and the markets for these investments have been and are 
expected to remain liquid.  KILICO plans to continue to reduce its holding 
of such investments over time.

                                   14

<PAGE>

Approximately 10.2 percent of KILICO's investment-grade fixed maturities at 
June 30, 1998 consisted of corporate asset-backed securities, compared with 
10.8 percent at December 31, 1997.  The majority of KILICO's investments in 
asset-backed securities were backed by manufactured housing loans, auto 
loans and home equity loans.

Future investment income from mortgage-backed securities and other asset-
backed securities may be affected by the timing of principal payments and 
the yields on reinvestment alternatives available at the time of such 
payments. As a result of purchase accounting adjustments to fixed 
maturities, most of KILICO's mortgage-backed securities are carried at a 
premium over par.  Prepayment activity resulting from a decline in interest 
rates on such securities purchased at a premium would accelerate the 
amortization of the premiums which would result in reductions of investment 
income related to such securities.  At June 30, 1998, KILICO had 
unamortized premiums and discounts of $17.2 million and $4.8 million, 
respectively, related to mortgage-backed and asset-backed securities.  
Reductions to investment income related to the amortization of premiums and 
discounts amounted to $8.9 million during the first half of 1998, compared 
with $9.0 million in the first half of 1997.  KILICO believes that as a 
result of the purchase accounting adjustments and the current interest rate 
environment, anticipated prepayment activity is expected to result in 
further reductions to future investment income for the remainder of 1998.

Real estate-related investments

The $214.0 million real estate portfolio held by KILICO, consisting of 
joint venture and third-party mortgage loans and other real estate-related 
investments, constituted 5.1 percent of cash and invested assets at June 
30, 1998, compared with $220.0 million, or 4.9 percent, at December 31, 
1997.
 	
As reflected in the "Real estate portfolio" table on the following page, 
KILICO has continued to fund both existing projects and legal commitments. 
The future legal commitments declined to $64.7 million at June 30, 1998, 
compared with $75.3 million at December 31, 1997, primarily due to sales.  
As of June 30, 1998, KILICO expects to fund approximately $6.3 million of 
these legal commitments, along with providing capital to existing projects. 
The disparity between total legal commitments and the amount expected to be 
funded relates principally to standby financing arrangements that provide 
credit enhancements to certain tax-exempt bonds, which KILICO does not 
presently expect to fund.  The total legal commitments, along with 
estimated working capital requirements, are considered in KILICO's 
evaluation of reserves and write-downs. 

Excluding the $1.7 million of real estate owned and $15.3 million of net equity 
investments in joint ventures, KILICO's real estate loans totaled $197.0
million at June 30, 1998, after reserves and writedowns. Of this amount, $164.4
million are on accrual status with a weighted average interest rate of
approximately 8.9 percent.  Of these accrual loans, 8.1 percent have terms
requiring current periodic payments of their full contractual interest, 53.8
percent require only partial payments or payments to the extent of cash flow of
the borrowers, and 38.1 percent defer all interest to maturity.

                                   15

<PAGE>
<TABLE>
Real estate portfolio
(in millions) 	           
<CAPTION>
                                Mortgage loans
                               ----------------
                              Joint      Third-
                              venture    party
                              -------    -------
<S>                            <C>       <C>
Balance at December 31, 1997   $ 72.7    $103.0
Additions (deductions):
Fundings                          1.1         -
Interest added to principal       3.1       1.4
Sales/paydowns/distributions    (11.0)      (.2)
Operating loss                      -         -
Realized investments gains
 (losses)                         4.3       2.6
Other transactions, net          (2.3)     (2.6)
                                -----     -----
Balance at June 30, 1998       $ 67.9    $104.2


Real estate portfolio
(in millions)
<CAPTION>
                                Other real estate-related investments
                              -----------------------------------------
		                           	Other      Real estate    Equity 
		                            loans<F2>     owned  	  investments 	Total
		               	            ---------	 -----------	 ----------- 	------	
<S>                            <C>         <C>           <C>       <C>
Balance at December 31, 1997	  $ 21.1	     $  4.0	       $19.2	    $220.0 <F1>
Additions (deductions):	
Fundings	 	                         -	         .2           	-	       1.3
Interest added to principal	        -	          -	           -	       4.5
Sales/paydowns/distributions	      	-	       (2.9)       	(3.1)    	(17.2)
Operating loss	                     -          	-         	(.2)      	(.2)
Realized investments gains
 (losses)	                        3.9	         .3	         (.6)     	10.5
Other transactions, net	        	 (.1)        	.1	           -	      (4.9)
	                              	-----	      -----	       -----     	-----
Balance at June 30, 1998	    	 $ 24.9     	$  1.7	       $15.3    	$214.0 <F3>
	                              	=====	      =====       	=====	     =====
__________________________
<FN>
<F1> Net of $9.2 million reserve and writedowns. Excludes $9.5 million of real
     estate-related accrued interest.
<F2> The other real estate loans were notes receivable evidencing financing,
    	primarily to joint ventures.  These loans were issued by KILICO generally
     to provide financing for Kemper's or KILICO's joint ventures for various
     purposes.
<F3>	Net of $8.8 million reserve and writedowns.  Excludes $9.1 million of
     real estate-related accrued interest.
</FN>
</TABLE>

Real estate concentrations

KILICO's real estate portfolio is distributed by geographic location and 
property type.  However, KILICO has concentration exposures in certain states 
and in certain types of properties.  In addition to these exposures, KILICO
also has exposures to certain real estate developers and partnerships. 

<TABLE>
<CAPTION>
Geographic distribution as of  	Distribution by property type as of 
June 30, 1998.	                 June 30, 1998.

  <S>           <C>               <S>         <C>
	 California	    40.3 %	          Hotel       	43.1 %
 	Hawaii	        11.4	            Land        	29.8
 	Colorado	      10.2	            Residential 	12.7
 	Oregon         	9.6            	Retail	       3.4
 	Washington	     9.5            	Office	       1.9
 	Florida	        5.4            	Industrial   	1.0
 	Texas          	5.3	            Other	        8.1
 	Michigan       	3.8	                        	-----
 	Ohio	           3.5	                       	100.0 %
 	Other states   	1.0	                        	=====
               		-----
 	Total	        100.0 %		
               		=====
</TABLE>

Undeveloped land represented approximately 29.8 percent of KILICO's real estate 
portfolio at June 30, 1998. To maximize the value of certain land and other 
projects, additional development has been proceeding or has been planned. Such 
development of existing projects would continue to require funding, either from 
KILICO or third parties.  In the present real estate markets, third-party 
financing can require credit enhancing arrangements (e.g., standby financing 
arrangements and loan commitments) from KILICO. The values of development 
projects are dependent on a number of factors, including Kemper's and KILICO's 
plans with respect thereto, obtaining necessary construction and zoning permits 
and market demand for the permitted use of the property. There can be no 
assurance that such permits will be obtained as planned or at all, nor that
such expenditures will occur as scheduled, nor that Kemper's and KILICO's
plans with respect to such projects may not change substantially.

                                   16

<PAGE>

Approximately half of KILICO's real estate loans are on properties or projects 
where KILICO, Kemper, or their affiliates have taken ownership positions in 
joint ventures with a small number of partners.

At June 30, 1998, loans to and investments in joint ventures in which Patrick
M. Nesbitt or his affiliates ("Nesbitt"), a third-party real estate developer,
have ownership interests constituted approximately $89.6 million, or 41.9
percent, of KILICO's real estate portfolio.  The Nesbitt ventures consist of
nine hotel properties and two office buildings.  At June 30, 1998, KILICO did
not have any Nesbitt-related off-balance sheet legal funding commitments
outstanding.

At June 30, 1998, loans to and investment in a master limited partnership (the 
"MLP") between subsidiaries of Kemper and subsidiaries of Lumbermens Mutual 
Casualty Company, a former affiliate, constituted approximately $64.7 million, 
or 30.2 percent, of KILICO's real estate portfolio. Kemper's interest is 75 
percent as of June 30, 1998.  At June 30, 1998, MLP-related commitments 
accounted for approximately $6.3 million of KILICO's off-balance sheet legal 
commitments, which KILICO expects to fund.

At June 30, 1998, KILICO no longer had any outstanding loans or investments in 
projects with the Prime Group, Inc. or its affiliates, as all such investments 
have been sold or written down to zero.  However, KILICO continues to have
Prime Group-related commitments, which accounted for $25.7 million of the
off-balance-sheet legal commitments at June 30, 1998.  KILICO does not expect
to fund any of these commitments.

The remaining significant real estate-related investment amounted to $28.1 
million at June 30, 1998 and consisted of various zoned and unzoned residential 
and commercial lots located in Hawaii. Due to certain negative zoning 
restriction developments in January 1997 and a continuing economic slump in 
Hawaii, KILICO has placed these real estate-related investments on nonaccural 
status.  KILICO is currently pursuing the zoning of all remaining unzoned 
properties, as well as pursuing steps to sell all remaining zoned properties.  
However, due to the state of the Hawaiian economy, which has lagged behind the 
economic expansion of most of the rest of the United States, KILICO anticipates 
that it could be several additional years until all of KILICO's investments in 
Hawaii are completely disposed of.

                                   17

<PAGE>

Real estate outlook

The following table is a summary of KILICO's troubled real estate-related 
investments:

<TABLE>
Troubled real estate-related investments
(before reserves and write-downs, except for real estate owned)
(in millions)
<CAPTION>
			                                               June 30     	December 31
                                                 		1998	           1997
                                                ------------	  -----------	
<S>                                               <C>             <C>
Potential problem loans <F1> 	                    $   -	          $   -
Past due loans <F2> 	                                 -	              -
Nonaccrual loans <F3>
 (primarily Hawaiian properties)	                  38.2	           47.4
Real estate owned	                                  1.7	            4.0
                                                  -----	          -----
  Total	                                          $39.9          	$51.4
	                                                 =====	          =====
	____________________________________________________________________
<FN>
  <F1> These are real estate-related investments where KILICO, based on known
       information, has serious doubts about the borrowers' abilities to
       comply with present repayment terms and which KILICO anticipates may
       go into nonaccrual, past due or restructured status.
  <F2>	Interest more than 90 days past due but not on nonaccrual status.
  <F3> KILICO does not accrue interest on real estate-related investments when
       it judges that the likelihood of collection of interest is doubtful.
       Loans on nonaccrual status after reserves and write-downs amounted to
       $32.6 million and $41.8 million at June 30, 1998 and December 31, 1997,
       respectively.
</FN>
</TABLE>

KILICO evaluates its real estate-related investments (including accrued 
interest) using an estimate of each investment's observable market price, 
net of estimated costs to sell.  Because KILICO's real estate review 
process includes estimates, there can be no assurance that current 
estimates will prove accurate over time due to changing economic 
conditions and other factors. KILICO's real estate-related investments are 
expected to continue to decline further through future sales. KILICO's net 
income could be materially reduced in future periods if real estate market 
conditions worsen in areas where KILICO's portfolio is located or if 
Kemper's and KILICO's plans with respect to certain projects change or if 
necessary construction or zoning permits are not obtained.

Realized investment results

Reflected in net income are after-tax net realized investment gains of 
$11.4 million for the first half of 1998, compared with $5.9 million for the 
first half of 1997.

Unrealized gains and losses on fixed maturity investments are not reflected in 
KILICO's net income.  These changes in unrealized value are included within 
accumulated other comprehensive income, net of any applicable income taxes, in 
accordance with SFAS No. 130, as previously discussed. If and to the extent a 
fixed maturity investment suffers an other-than-temporary decline in value, 
however, such security is written down to net realizable value, and the 
write-down adversely impacts net income.

KILICO regularly monitors its investment portfolio and as part of this process 
reviews its assets for possible impairments of carrying value.  Because the 
review process includes estimates, there can be no assurance that current 
estimates will prove accurate over time due to changing economic conditions and 
other factors.

A valuation allowance has been established, and is evaluated as of each
reported period end, to reduce the deferred tax asset for investment losses to
the amount that, based upon available evidence, is in management's judgment
more likely than not to be realized.  

                                   18

<PAGE>

Interest rates

Interest rates have been relatively stable in the first half of 1998, 
contributing to a slight increase in unrealized fixed maturity investment
gains.  Interest rate fluctuations can cause significant fluctuations in
both future investment income and future realized and unrealized investment
gains and losses. Also, lower renewal crediting rates on annuities, compared
with competitors' higher new money crediting rates, have also influenced
certain annuity holders to seek alternative products. KILICO mitigates this
risk somewhat by charging surrender fees which decrease over time when annuity 
holders withdraw funds prior to maturity on certain annuity products.  However, 
approximately 45 percent of KILICO's fixed and variable annuity liabilities as 
of June 30, 1998 were no longer subject to significant surrender fees.


LIQUIDITY AND CAPITAL RESOURCES

KILICO carefully monitors cash and short-term investments to maintain adequate 
balances for timely payment of policyholder benefits, expenses, taxes and 
policyholder's account balances.  In addition, regulatory authorities establish 
minimum liquidity and capital standards. The major ongoing sources of KILICO's 
liquidity are deposits for fixed annuities, investment income, premium income, 
separate account fees, other operating revenue and cash provided from maturing 
or sold investments.  (See the "Policyholder surrenders and withdrawals" table 
and related discussion and "INVESTMENTS" above.)

Ratings

Ratings are an important factor in establishing the competitive position of
life insurance companies.  Rating organizations continue to review the
financial performance and condition of life insurers and their investment
portfolios, including those of KILICO. Any reductions in KILICO's claims-paying
ability or financial strength ratings could result in its products being less
attractive to consumers.  Any reductions in KILICO's parent's ratings could
also adversely impact KILICO's financial flexibility.

Ratings reductions for Kemper or its subsidiaries and other financial events
can also trigger obligations to fund certain real estate-related commitments to
take out other lenders.  In such event, those lenders can be expected to
renegotiate their loan terms, although they are not contractually obligated to
do so.

Each rating is subject to revision or withdrawal at any time by the assigning 
organization and should be evaluated independently of any other rating.  

                                   19

<PAGE>

PART II.	    OTHER INFORMATION

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

             (a)	 EXHIBIT INDEX.

                  Exhibit No.
                  -----------
                  27 Financial Data Schedule

             (b) 	REPORTS ON FORM 8-K.

             No reports on Form 8-K were filed during the six 
          			months ended June 30, 1998.

                                   20

<PAGE>

                 Kemper Investors Life Insurance Company
                                FORM 10-Q
                For the fiscal period ended June 30, 1998
               --------------------------------------------

                               SIGNATURES

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

                               Kemper Investors Life Insurance Company
                                 (Registrant)


    Date:	     August 12, 1998     By: /s/JOHN B. SCOTT
                                      ----------------------------------
                                     	John B. Scott
                                      President, Chief Executive Officer and
                                      Director

    Date:	     August 12, 1998     By: /S/FREDERICK L. BLACKMON
                                      ---------------------------------
                                      Frederick L. Blackmon
                                      Sr. Vice President and
                                      Chief Financial Officer

                                   21

<PAGE>

THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE FIRST 
QUARTER FINANCIAL STATEMENTS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO 
SUCH FINANCIAL STATEMENTS.

[MULTIPLIER] 	1,000

[PERIOD-TYPE]	6-MOS.	           
[FISCAL-YEAR-END]		                                           DEC-31-1998
[PERIOD-START]		                                              JAN-01-1998
[PERIOD-END]		                                                JUN-30-1998
[DEBT-HELD-FOR-SALE]                                           	3,591,991
[DEBT-CARRYING-VALUE]	                                          3,591,991
[DEBT-MARKET-VALUE]		                                           3,591,991
[EQUITIES]		                                                       75,341
<MORTGAGES>		                                                     172,074
[REAL-ESTATE]		                                                    41,891
[TOTAL-INVEST]		                                                4,221,401
[CASH]		                                                           20,785
[RECOVER-REINSURE]	                                              	361,172
[DEFERRED-ACQUISITION]	                                            78,419
[TOTAL-ASSETS]		                                               11,159,518
[POLICY-LOSSES]		                                               3,662,012
[UNEARNED-PREMIUMS]		                                                   0
[POLICY-OTHER]		                                                        0
[POLICY-HOLDER-FUNDS]	                                            245,884
[NOTES-PAYABLE]		                                                       0
[COMMON]		                                                          2,500
[PREFERRED-MANDATORY]	                                                  0
[PREFERRED]		                                                           0
[OTHER-SE]		                                                      897,152
[TOTAL-LIABILITY-AND-EQUITY]                                  	11,159,518
[PREMIUMS]	                                                       	11,144
[INVESTMENT-INCOME]		                                             139,018
[INVESTMENT-GAINS]		                                               17,527
[OTHER-INCOME]		                                                   40,340
[BENEFITS]		                                                      115,869
[UNDERWRITING-AMORTIZATION]	                                        1,644
[UNDERWRITING-OTHER]	                                                   0
[INCOME-PRETAX]		                                                  44,138
[INCOME-TAX]		                                                     19,021
[INCOME-CONTINUING]		                                              25,117
<DISCOUNTED>		                                                          0
[EXTRAORDINARY]		                                                       0
[CHANGES]		                                                             0
[NET-INCOME]		                                                     25,117
[EPS-PRIMARY]		                                                         0
[EPS-DILUTED]	                                                         	0
[RESERVE-OPEN]		                                                        0
[PROVISION-CURRENT]		                                                   0
[PROVISION-PRIOR]		                                                     0
[PAYMENTS-CURRENT]		                                                    0
[PAYMENTS-PRIOR]	                                                      	0
[RESERVE-CLOSE]		                                                       0
[CUMULATIVE-DEFICIENCY]	                                                0

                                   22