UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549



                                    FORM 10-Q



                Quarterly Report Pursuant to Section 13 or 15(d)
                     of the Securities Exchange Act of 1934


                  For the Quarterly Period Ended June 30, 1999

                            Commission file numbers:
                          33-62953, 33-88360, 33-89678,
                   33-91400, 333-00995, 333-02867, 333-24989,
                  333-25733, 333-25761, 333-26695 and 333-77210

                   American Skandia Life Assurance Corporation

                    Incorporated in the State of Connecticut

                                   06-1241288
                      (Federal Employer Identification No.)

                               One Corporate Drive
                           Shelton, Connecticut 06484

                         Telephone Number (203) 926-1888




Indicate by check mark  whether the registrant  (1) has filed all reports 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 10, 1999, there were 25,000 shares of outstanding common stock, par
value $80 per share, of the registrant,  consisting of 100 shares of voting and
24,900  shares of non-voting common stock,  all of which were owned by American
Skandia Investment  Holding Corporation,  a wholly-owned  subsidiary of Skandia
Insurance Company Ltd., a Swedish corporation.










<PAGE>


                   AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
          (a wholly-owned subsidiary of Skandia Insurance Company Ltd.)


                                TABLE OF CONTENTS


                                                                          Page
PART I.  FINANCIAL INFORMATION:

  Item 1.  Financial Statements:

    Consolidated Statements of Financial Condition -
      June 30, 1999 (unaudited)
      and December 31, 1998                                                 3

    Consolidated Statements of Income (unaudited) -
      Six months ended June 30, 1999
      and June 30, 1998                                                     4

    Consolidated Statements of Income (unaudited) -
      Three months ended June 30, 1999
      and June 30, 1998                                                     5

    Consolidated Statements of Shareholder's Equity  -
      June 30, 1999 (unaudited)
      and December 31, 1998                                                 6

    Consolidated  Statements of Cash Flows  (unaudited) Six months
      ended June 30, 1999
      and June 30, 1998                                                     7

    Notes to Unaudited Consolidated Financial Statements                    8


  Item 2.  Management's Discussion and Analysis
           of Financial Condition and Results of Operations
           - Six months ended June 30, 1999                                11


  Item 3. Quantitative and Qualitative Disclosures about Market Risk       15


PART II.  OTHER INFORMATION:

  Item 6. Exhibits and Reports on Form 8-K                                 15

          Signatures                                                       16

          Exhibit Index                                                    18



<PAGE>

                   AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
         (a wholly-owned subsidiary of Skandia Insurance Company, Ltd.)

                 CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
                                 (in thousands)

<TABLE>
<CAPTION>
                                                                          June 30,            December 31,
                                                                            1999                  1998
                                                                        (unaudited)
                                                                       ---------------       ---------------

ASSETS

Investments:
<S>                                                                  <C>                   <C>
   Fixed maturities - at amortized cost                              $          8,060      $          8,289
   Fixed maturities - at fair value                                           134,281               141,195
   Mutual funds                                                                11,446                 8,210
   Policy loans                                                                   737                   569
                                                                       ---------------       ---------------

      Total investments                                              $        154,524      $        158,263

Cash and cash equivalents                                                      69,670                77,525
Accrued investment income                                                       3,100                 2,880
Fixed assets                                                                      368                   328
Deferred acquisition costs                                                    885,098               721,507
Reinsurance receivable                                                          4,829                 4,191
Receivable from affiliates                                                        523                 1,161
Income tax receivable - deferred                                               41,487                38,861
State insurance licenses                                                        4,338                 4,413
Other assets                                                                    4,772                 3,744
Separate account assets                                                    22,074,578            17,835,400
                                                                       ---------------       ---------------
      Total assets                                                   $     23,243,287      $     18,848,273
                                                                       ===============       ===============

LIABILITIES AND SHAREHOLDER'S EQUITY

LIABILITIES:
  Reserve for future contractowner benefits                          $         33,957      $         37,508
  Policy reserves                                                              37,178                25,545
  Drafts outstanding                                                           31,074                28,941
  Accounts payable and accrued expenses                                       108,231                91,827
  Income tax payable                                                            2,112                 6,657
  Future fees payable to parent                                               464,910               368,978
  Short-term borrowing                                                         10,000                10,000
  Surplus notes                                                               193,000               193,000
  Separate account liabilities                                             22,074,578            17,835,400
                                                                       ---------------       ---------------
      Total liabilities                                              $     22,955,040      $     18,597,856
                                                                       ---------------       ---------------

SHAREHOLDER'S EQUITY:
  Common stock, $80 par, 25,000 shares
   authorized, issued and outstanding                                $          2,000      $          2,000
  Additional paid-in capital                                                  191,579               179,889
  Retained earnings                                                            94,760                64,993
  Accumulated other comprehensive income                                          (92)                3,535
                                                                       ---------------       ---------------

      Total shareholder's equity                                              288,247               250,417
                                                                       ---------------       ---------------

      Total liabilities and shareholder's equity                     $     23,243,287      $     18,848,273
                                                                       ===============       ===============
</TABLE>


            See notes to unaudited consolidated financial statements.
                                        3

<PAGE>

                   AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
         (a wholly-owned subsidiary of Skandia Insurance Company, Ltd.)

                        CONSOLIDATED STATEMENTS OF INCOME
                                   (unaudited)
                                 (in thousands)

<TABLE>
<CAPTION>
                                                                                Six Months Ended June 30,
                                                                                 1999               1998
                                                                             -------------      -------------

REVENUES

<S>                                                                        <C>                <C>
Annuity and life insurance charges & fees                                  $      128,807     $       85,083
Fee income                                                                         36,290             23,227
Net investment income                                                               5,496              5,671
Premium income                                                                        908                 81
Net realized capital gains                                                            320                170
Other                                                                                 842                148
                                                                             -------------      -------------

    Total Revenues                                                                172,663            114,380
                                                                             -------------      -------------

BENEFITS AND EXPENSES

Benefits:
  Annuity benefits                                                                    380                559
  Change in annuity policy reserves                                                 9,278                403
  Cost of minimum death benefit reinsurance                                         2,955              2,674
  Return credited to contractowners                                                (3,862)            (7,016)
                                                                             -------------      -------------

                                                                                    8,751             (3,380)
                                                                             -------------      -------------

Expenses:
  Underwriting, acquisition and other insurance expenses                           93,941             73,567
  Interest expense                                                                 29,218             18,797
                                                                             -------------      -------------

                                                                                  123,159             92,364
                                                                             -------------      -------------

     Total Benefits and Expenses                                                  131,910             88,984
                                                                             -------------      -------------

Income from operations before income taxes                                         40,753             25,396

     Income tax expense                                                            10,986              5,349
                                                                             -------------      -------------

        Net income                                                         $       29,767     $       20,047
                                                                             =============      =============
</TABLE>



            See notes to unaudited consolidated financial statements.
                                        4

<PAGE>

                   AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
         (a wholly-owned subsidiary of Skandia Insurance Company, Ltd.)

                        CONSOLIDATED STATEMENTS OF INCOME
                                   (unaudited)
                                 (in thousands)

<TABLE>
<CAPTION>
                                                                               Three Months Ended June 30,
                                                                                 1999               1998
                                                                             -------------      -------------

REVENUES

<S>                                                                        <C>                <C>
Annuity and life insurance charges & fees                                  $       68,486     $       45,297
Fee income                                                                         19,313             12,540
Net investment income                                                               2,842              2,410
Premium income                                                                        159                 31
Net realized capital gains                                                             25                 13
Other                                                                                 477                 78
                                                                             -------------      -------------

    Total Revenues                                                                 91,302             60,369
                                                                             -------------      -------------

BENEFITS AND EXPENSES

Benefits:
  Annuity benefits                                                                    159                193
  Change in annuity policy reserves                                                 8,521                165
  Cost of minimum death benefit reinsurance                                         1,206              1,305
  Return credited to contractowners                                                  (432)            (8,683)
                                                                             -------------      -------------
                                                                                    9,454             (7,020)
                                                                             -------------      -------------

Expenses:
  Underwriting, acquisition and other insurance expenses                           42,956             39,274
  Interest expense                                                                 15,393              9,966
                                                                             -------------      -------------

                                                                                   58,349             49,240
                                                                             -------------      -------------

     Total Benefits and Expenses                                                   67,803             42,220
                                                                             -------------      -------------

Income from operations before income taxes                                         23,499             18,149

     Income tax expense                                                             7,142              4,174
                                                                             -------------      -------------

        Net income                                                         $       16,357     $       13,975
                                                                             =============      =============
</TABLE>


            See notes to unaudited consolidated financial statements.

                                        5

<PAGE>
                   AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
         (a wholly-owned subsidiary of Skandia Insurance Company, Ltd.)

                 CONSOLIDATED STATEMENTS OF SHAREHOLDER'S EQUITY
                                 (in thousands)

<TABLE>
<CAPTION>
                                                                          June 30,            December 31,
                                                                            1999                  1998
                                                                        (unaudited)
                                                                       ---------------       ---------------

Common stock:
<S>                                                                  <C>                   <C>
   Beginning and ending balance                                      $          2,000      $          2,000

Additional paid in capital:
  Beginning balance                                                           179,889               151,527
    Additional contributions                                                   11,690                28,362
                                                                       ---------------       ---------------
       Ending balance                                                         191,579               179,889

Retained earnings:
   Beginning balance                                                           64,993                30,226
      Net income                                                               29,767                34,767
                                                                       ---------------       ---------------
         Ending balance                                                        94,760                64,993

Accumulated other comprehensive income:
   Beginning balance                                                            3,535                   668
      Other comprehensive income                                               (3,627)                2,867
                                                                       ---------------       ---------------
         Ending balance                                                           (92)                3,535
                                                                       ---------------       ---------------
            Total shareholders equity                                $        288,247      $        250,417
                                                                       ===============       ===============
</TABLE>

            See notes to unaudited consolidated financial statements.

                                        6

<PAGE>

                   AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
         (a wholly-owned subsidiary of Skandia Insurance Company, Ltd.)

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (unaudited)
                                 (in thousands)

<TABLE>
<CAPTION>
                                                                          Six Months Ended June 30,
                                                                           1999                1998
                                                                       -------------       -------------

Cash Flow from operating activities:

<S>                                                                 <C>                  <C>
Net income                                                          $        29,767      $       20,047
Adjustments to reconcile net income to net cash
  used in operating activities:
    Increase in policy reserves                                              11,633                 729
    Amortization of bond discount                                                60                  47
    Amortization of insurance licenses                                           75                  75
    Change in receivable from/payable to affiliates                             638               4,191
    (Decrease)/increase in income tax payable                                (4,545)              6,746
    Increase in other assets                                                 (1,068)               (532)
    Increase in accrued investment income                                      (220)               (275)
    Increase in reinsurance receivable                                         (638)               (918)
    Increase in deferred acquisition costs, net                            (163,591)            (85,923)
    Increase in income tax receivable - deferred                               (673)             (5,141)
    Increase in accounts payable and accrued expenses                        16,404              32,799
    Increase in drafts outstanding                                            2,133               4,669
    Change in foreign currency translation, net                                 704                  46
    Realized gain on sale of investments                                       (320)               (170)
                                                                       -------------       -------------
        Net cash used in operating activities                              (109,641)            (23,610)
                                                                       -------------       -------------
Cash flow from investing activities:

    Purchase of fixed maturity investments                                  (29,582)            (17,684)
    Proceeds from sale and maturity of fixed maturity investments            29,504                  50
    Purchase of shares in mutual funds                                      (13,918)             (5,084)
    Proceeds from sale of shares in mutual funds                             11,879               4,769
    Increase in policy loans                                                   (168)               (122)
                                                                       -------------       -------------
        Net cash used in investing activities                                (2,285)            (18,071)
                                                                       -------------       -------------
Cash flow from financing activities:

    Capital contributions from parent                                        11,690               1,063
    Increase in future fees payable to parent                                95,932              47,507
    Net (withdrawals from)/deposits to contractowner accounts                (3,551)             (4,601)
                                                                       -------------       -------------
    Net cash provided by financing activities                               104,071              43,969
                                                                       -------------       -------------
    Net (decrease)/increase in cash and cash equivalents                     (7,855)              2,288

Cash and cash equivalents at beginning of period                             77,525              81,974
                                                                       -------------       -------------
Cash and cash equivalents at end of period                           $       69,670      $       84,262
                                                                       =============       =============
Supplemental cash flow disclosure:
    Income taxes paid                                                $       16,205      $        1,620
                                                                       =============       =============

    Interest paid                                                    $       29,900      $       16,080
                                                                       =============       =============
</TABLE>

            See notes to unaudited consolidated financial statements.

                                        7

<PAGE>


                   AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
          (a wholly-owned subsidiary of Skandia Insurance Company Ltd.)


              NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

                                  June 30, 1999


1.     BASIS OF PRESENTATION

       The  accompanying   unaudited   consolidated  financial  statements  of
       American  Skandia Life  Assurance  Corporation  (the Company) have been
       prepared in accordance with generally  accepted  accounting  principles
       for interim  financial  information  and with the  instructions to Form
       10-Q and Article 10 of Regulation S-X. Accordingly, they do not include
       all of the  information  and footnotes  required by generally  accepted
       accounting principles for complete financial statements. In the opinion
       of  management,   all  adjustments   (consisting  of  normal  recurring
       accruals)  considered  necessary  for a  fair  presentation  have  been
       included.  Operating  results for the  six-month  period ended June 30,
       1999 are not necessarily indicative of the results that may be expected
       for the year ending December 31, 1999. For further  information,  refer
       to the consolidated  financial  statements and footnotes thereto in the
       Company's audited consolidated  financial statements for the year ended
       December 31, 1998.

       Certain  reclassifications  have been made to prior  period  amounts to
       conform to the current period presentation.


2.     NEW ACCOUNTING PRONOUNCEMENT

       In March 1998, the American  Institute of Certified Public  Accountants
       issued Statement of Position ("SOP") 98-1, "Accounting for the Costs of
       Software  Developed or Obtained for  Internal  Use. The SOP,  which has
       been  adopted  prospectively  as  of  January  1,  1999,  requires  the
       capitalization  of certain costs incurred in connection with developing
       or obtaining internal use software.  Prior to the adoption of SOP 98-1,
       the  Company  expensed  all  internal  use  software  related  costs as
       incurred.  The Company has  identified  and  capitalized  $1,186,000 of
       costs  associated  with  internal  use  software  through the first six
       months of 1999, and is amortizing  the  applicable  costs on a straight
       line basis over a three-year period.


3.     SEGMENT REPORTING

       In June 1997, the FASB issued SFAS 131,  "Disclosures about Segments of
       an Enterprise and Related  Information." SFAS 131 establishes standards
       for the way that public  enterprises report information about operating
       segments  in  annual  financial  statements  and  requires  that  those
       enterprises  report selected  information  about operating  segments in
       interim financial  reports issued to shareholders.  It also establishes
       standards   related  to   disclosures   about  products  and  services,
       geographic  areas  and  major  customers.  SFAS  131 is  effective  for
       financial statement periods beginning after December 15, 1997.

       During 1998, to complement its annuity  products,  the Company launched
       specific  marketing and operational  activities  towards the release of
       variable life insurance and qualified retirement plan annuity products.
       As of June 30, 1999, sales were not significant  enough to warrant full
       segment  disclosures.  Sales, as measured by premium received,  for the
       year ended June 30,  1999 and assets  under  management  as of June 30,
       1999, for the respective segments were as follows:

<TABLE>
<CAPTION>
                      (in thousands)                   Variable         Variable       Qualified
                                                        Annuity           Life           Plans            Total

<S>                                                 <C>                  <C>             <C>          <C>
         Sales                                      $  3,213,942         $6,109          $40,129      $  3,260,180
                                                    ============         ======          =======      ============

         Assets under management                    $21,995,491          $7,455          $93,345       $22,096,291
                                                    ===========          ======          =======     =============
</TABLE>


<PAGE>


                   AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
          (a wholly-owned subsidiary of Skandia Insurance Company Ltd.)


        NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (continued)

                                  June 30, 1999


4.     COMPREHENSIVE INCOME

       As of January 1, 1998,  the  Company  adopted  Statement  of  Financial
       Accounting  Standards ("SFAS") 130, "Reporting  Comprehensive  Income".
       SFAS 130 sets standards for the reporting and display of  comprehensive
       income and its components;  however, the adoption of this Statement had
       no impact on the Company's  financial position or net income.  SFAS 130
       requires    unrealized    gains   and    losses   on   the    Company's
       available-for-sale   securities   and  foreign   currency   translation
       adjustments,  which  prior to  adoption  were  reported  separately  in
       shareholder's equity to be included in other comprehensive income.

       The components of comprehensive  income, net of tax, for the six months
       ended June 30, 1999 and 1998 were as follows:

<TABLE>
<CAPTION>
                  (in thousands)                                           1999              1998
                                                                           ----              ----

<S>                                                                       <C>              <C>
         Net income                                                       $29,767          $20,047
         Other comprehensive income:
            Net unrealized gains/(losses) on securities                    (4,083)           1,141
            Foreign currency translation                                      456              (47)
                                                                       ----------     -------------

         Other comprehensive income                                        (3,627)           1,094
                                                                        ---------       ----------

         Comprehensive income                                             $26,140          $21,141
                                                                          =======          =======
</TABLE>

       The components of accumulated other  comprehensive  income, net of tax,
       as of June 30, 1999 and December 31, 1998 were as follows:

<TABLE>
<CAPTION>
                  (in thousands)                                           1999              1998
                                                                           ----              ----

<S>                                                                         <C>             <C>
         Unrealized investment gains                                        $(240)          $3,843
         Foreign currency translation                                         148             (308)
                                                                          -------          -------

         Accumulated other comprehensive income                            $  (92)          $3,535
                                                                           =======          ======
</TABLE>


5.     FOREIGN ENTITY

       The  Company  has a 99.9%  ownership  in  Skandia  Vida,  S.A.  de C.V.
       ("Skandia Vida") which is a life insurance company domiciled in Mexico,
       selling long-term  savings products within Mexico.  Skandia Vida, which
       is fully  consolidated in the accompanying  financial  statements,  had
       total  shareholders'  equity  of  $5,897,000  as of June  30,  1999 and
       $4,724,000  as of  December  31,  1998  and  has  generated  losses  of
       $1,220,000  and  $979,000  for the six months  ended June 30,  1999 and
       1998, respectively.




<PAGE>


                   AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
          (a wholly-owned subsidiary of Skandia Insurance Company Ltd.)


        NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS (continued)

                                  June 30, 1999


6.     FUTURE FEES PAYABLE TO PARENT

       On June 23,  1999,  the Company sold to its Parent,  effective  June 1,
       1999,  certain rights to receive future fees and charges expected to be
       realized  on the  variable  portion of a  designated  block of deferred
       annuity  contracts  issued  during the period April 1994 through  April
       1999.  In  connection   with  this   transaction,   the  Parent  issued
       collateralized  notes in a private  placement  which are secured by the
       rights to receive future fees and charges purchased from the Company.

       Under the terms of the Purchase Agreement,  the rights sold provide for
       the Parent to receive 80% of future  mortality and expense  charges and
       contingent  deferred  sales  charges  expected to be realized  over the
       remaining   surrender   charge  period  of  the  designated   contracts
       (generally,  7 years).  The  Company  did not sell the right to receive
       future fees and charges after the  expiration  of the surrender  charge
       period.

       The proceeds  from the sale will be recorded as a liability and will be
       amortized over the remaining  surrender charge period of the designated
       contracts using the interest method.  The present value at June 1, 1999
       (discounted  at  7.5%),  of  future  fees and  charges  expected  to be
       realized on the designated contracts was $120,632,000.

       Expected   payments  of  future  fees  payable  to  Parent  under  this
       transaction are as follows:

                                          (in thousands)
                        Period Ending
                         December 31,         Amount
                         ------------        --------
                             1999             $13,906
                             2000              23,014
                             2001              21,778
                             2002              19,858
                             2003              16,671
                             2004              13,270
                             2005               8,517
                             2006               3,327
                             2007                 291
                         -----------         --------

                            Total            $120,632




<PAGE>


                   AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
          (a wholly-owned subsidiary of Skandia Insurance Company Ltd.)


           MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                            AND RESULTS OF OPERATIONS

                         Six months ended June 30, 1999


American  Skandia Life  Assurance  Corporation (the  "Company") is a stock life
insurance  company  domiciled in Connecticut with licenses in all 50 states and
the District of Columbia.  It is a wholly-owned subsidiary of American  Skandia
Investment Holding Corporation (the "Parent"), whose ultimate parent is Skandia
Insurance Company Ltd., a Swedish company.

The  Company is  primarily  in the  business of issuing  long-term  savings and
retirement  products to individuals, groups and qualified pension plans.  Since
its business  inception in 1988, the Company has offered an  increasingly  wide
array of annuities, including: a)certain deferred annuities that are registered
with the Securities and Exchange Commission,  including  variable annuities and
fixed interest rate annuities that include a market value adjustment feature; b)
certain  other  fixed  deferred  annuities  that  are not registered  with  the
Securities and Exchange  Commission; c) non-registered group variable annuities
designed as funding  vehicles for various types of qualified retirement  plans;
and d) fixed and adjustable immediate annuities.

In April  1998,  the Company began  offering a term life  insurance  product in
support  of an  affiliate's mutual  fund  products.  In May 1998,  the  Company
launched a single premium variable life  insurance  product and in January 1999
the Company launched its second variable life product,  which was designed as a
flexible premium product.

The  Company  markets  its  products to  independent   financial  planners  and
broker-dealers  through an internal field  marketing  staff.  In addition,  the
Company markets through and in conjunction with financial institutions  such as
banks that are permitted directly, or through affiliates, to sell annuities and
life insurance.


RESULTS OF OPERATIONS

Annuity and life  insurance sales volume for the six months ended June 30, 1999
and 1998 was $3,260,180,000 and  $1,922,757,000,  respectively,  an increase of
70%. This increase was the result of innovative product development activities,
favorable market conditions, the development of business relationships with and
retention of top producers, and the continued  success of the Company's  highly
rated customer service teams. Assets grew  $4,395,014,000 or 23% since December
31, 1998.  This increase is a direct  result of the strong  performance  of the
stock markets over the first half of 1999, which has  contributed to the growth
in separate  account assets, combined with increases in separate account assets
and  deferred  acquisition costs  over the  same  period  due to sales  volume.
Liabilities grew $4,357,184,000 or 23% since December 31, 1998 as a result of an
increase in additional reserves required for the market and sales-related growth
of separate  account  assets as well as an  increase in future fees  payable to
Parent due to the closing of another securitization transaction in June 1999.

The Company  experienced  a net gain of  $29,767,000  after tax for the current
period compared with $20,047,000 for the same period last year.The increase was
the result of greater  than  expected  sales  levels and  substantial growth in
assets under  management, which generated higher amounts of annuity charges and
fees and transfer agency type fee income, combined with favorable expense levels
compared with the level of sales volume.


REVENUES

Due to strong market conditions  and as a result of the  significant  growth in
sales and assets  under management,  contract  owner fees and  charges and fees
generated from transfer agency type activities increased  $56,787,000 or 52% in
the first  half of 1999  over the first half of 1998.  This is  compared  to an
increase of 64% for the six months ended June 30, 1998.

Net investment income decreased 3% as compared with an increase of 42% in 1998.
The insignificant change in 1999 was because general account  investment levels
remained  relatively consistent from year to year. The increase in 1998 was the
result of income generated  from bond  holdings,  which were increased in early
1998 and late 1997 to meet risk based capital goals, which in turn, increased as
a result of the growth in business.


<PAGE>


                   AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
          (a wholly-owned subsidiary of Skandia Insurance Company Ltd.)


           MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                      AND RESULTS OF OPERATIONS (Continued)


Premium income represents  premiums earned on sales of immediate annuities with
life contingencies, supplementary contracts with life contingencies and certain
life  insurance  products. There  have been  minimal  sales of these  ancillary
products during both 1999 and 1998.


BENEFITS

Annuity  benefits  relate to annuity  contracts with  mortality  risks,
these  being  immediate   annuity   contracts  with  life   contingencies   and
supplementary  contracts  with  life contingencies.  Due  to the  age of  these
policies  in force and the  relative insignificance  of these  products  to the
Company's overall portfolio of products, fluctuations in these benefits were of
marginal importance to the Company's total operations.

The change in annuity policy reserves includes  changes in reserves  related to
annuity  contracts  with  mortality risks as well as the  Company's  guaranteed
minimum  death benefit liability on its variable  annuity  product.  During the
second quarter of 1999, the Company's agreement to reinsure substantially all
of its exposure on the guaranteed minimum death benefit was terminated  and the
business was recaptured, as the reinsurer had recently  announced its intention
to exit this  market. In  addition,  the Company  has  modified  its  reserving
methodology in accordance with the actuarial  guidelines  regarding  guaranteed
minimum death  benefit reserves.  These changes  resulted in an increase in the
guaranteed  minimum death  benefit  reserves  of  $8,024,000.  The  Company  is
evaluating alternatives to manage these risks going forward.

The reinsurance premium associated with reinsuring the guaranteed minimum death
benefit exposure is based on levels of assets under management.Due to increased
sales and account growth this cost had  increased 11% in the first half of 1999
(payments made through May 31,1999 only) and 48% in the first half of 1998.

Return credited to contractowners includes  primarily  revenues on the variable
and market value adjusted annuities and variable life insurance,  offset by the
benefit payments and change in reserves required on this business.The change in
the return  credited to  contractowners  for the six months ended June 30, 1999
compared  with June 30,  1998  represents  a decline in the expected  return on
market value  adjusted  contracts. This return was higher than expected in 1998
and lower than expected in 1999.


EXPENSES

Underwriting,  acquisition and other  insurance  expenses for the
six months ended June 30, 1999 and 1998 were as follows:

<TABLE>
<CAPTION>
                              (in thousands)                              June 30,        June 30,
                                                                            1999             1998

<S>                                                                       <C>             <C>
      Commissions                                                         $181,820        $101,489
      General expenses                                                      75,712          58,001
      Net capitalization of deferred acquisition costs                    (163,591)        (85,923)
                                                                          --------        --------

      Underwriting, acquisition and other insurance expenses              $ 93,941        $ 73,567
                                                                          ========        ========
</TABLE>


Commissions  increased  with the  growth in sales and assets under  management.
General expenses  increased with the growth in sales, along with start up costs
associated  with the Company's entry into variable life insurance and qualified
plans. The net capitalization of deferred acquisition costs also increased with
the growth in sales related costs.



<PAGE>


                   AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
          (a wholly-owned subsidiary of Skandia Insurance Company Ltd.)


           MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                      AND RESULTS OF OPERATIONS (Continued)


Interest expense increased $10,421,000 or 55% over the six months ended June 30,
1998 as a result of additional financing  transactions,  which consisted of the
sale of future  fees to the Parent  ("securitization  transactions")  initiated
throughout  1998 and 1999 offset by a decrease  in surplus  notes  outstanding.
Surplus notes as of June 30, 1999 and December 31, 1998 totaled $193,000,000.

The effective income tax rates for the six months ended June 30, 1999, and 1998
were 27% and 21%,  respectively. The effective rate is lower than the corporate
rate of 35% due to permanent differences,  with the most significant item being
the dividend received  deduction. Management believes that based on the taxable
income  produced  in 1998 and the first  six  months  of  1999,  as well as the
continued growth in annuity sales, the Company will produce sufficient  taxable
income in the future to realize its deferred tax assets.


LIQUIDITY AND CAPITAL RESOURCES

The Company's  first half 1999 liquidity  requirement  was met by
cash from insurance operations  reinsurance,  investment  activities,  advances
from Parent and the sale of rights to future fees and charges to its Parent.

Through the first six months of 1999 and 1998  approximately  95%
and 97%, respectively,  of  sales  were  variable  annuity  and life  insurance
products.Most products carry a contingent deferred sales charge, which causes a
temporary cash  strain in that 100% of the  proceeds  are  invested in separate
accounts supporting the product  leaving a cash (but not capital) strain caused
by the acquisition  cost for the new  business.  This cash strain  required the
Company to look beyond the cash made  available  by  insurance  operations  and
investments of the Company to financing through capital contributions, the sale
of certain rights to future fees and modified coinsurance arrangements.

On June 23,1999, the Company closed another securitization transaction in which
it received  proceeds of $120,632,000. This transaction is further discussed at
Note 6 of the Notes to Unaudited Consolidated Financial Statements.

During 1999 the Company  extended  certain  reinsurance  agreements (which were
initiated  prior to1996).  The reinsurance  agreements are modified coinsurance
arrangements where the reinsurer shares in the experience of a specific book of
business.

The  Company expects  the  continued  use  of  reinsurance  and  securitization
transactions to fund the cash strain anticipated from the acquisition  costs on
the coming years' sales volume.

The Company has long-term surplus notes and short-term borrowings
with its Parent. No dividends have been paid to its Parent.

The  National  Association  of Insurance  Commissioners  ("NAIC") requires
insurance companies to report information  regarding minimum Risk Based Capital
("RBC") requirements. These requirements are intended to allow insurance
regulators to identify companies which may need regulatory  attention.  The RBC
model law requires that insurance  companies  apply  various  factors to asset,
premium  and reserve  items,  all of which have  inherent  risks.  The  formula
includes components for asset risk,  insurance risk, interest risk and business
risk.

The Company has complied  with the NAIC's RBC  reporting  requirements  and has
total adjusted capital well above required capital.




<PAGE>


                   AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
          (a wholly-owned subsidiary of Skandia Insurance Company Ltd.)


           MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
                      AND RESULTS OF OPERATIONS (Continued)



YEAR 2000 COMPLIANCE

The Company is continuing its ongoing assessment of the potential impact of the
Year 2000  issue on various  aspects of its  business. The  Company's  computer
support is provided by its affiliate, American Skandia Information Services and
Technology  Corporation,  which also provides  such  support for the  Company's
affiliated  broker-dealer, American  Skandia  Marketing,  Incorporated  and the
Company's affiliated  investment  advisory firm,  American  Skandia  Investment
Services, Incorporated.  Because of the nature of the Company's  business,  any
assessment of the  potential impact of the Year 2000 issues on the Company must
be an assessment of the potential impact of these issues on all these companies,
which are referred to below as "American Skandia".

Business Partners

Management believes the area where the Company is most  vulnerable to Year 2000
issues is in its  interfaces  with computer  systems  of  investment  managers,
sub-advisors, third party administrators,  vendors and other business partners.
The inability to properly  recognize date sensitive electronic  information and
transfer  data between  systems  could cause errors or even a complete  systems
failure  which would  result in a temporary inability  to process  transactions
correctly or engage in normal business activities.

The American Skandia deferred annuity operational business partners report that
all critical  interfaces are Year 2000  compliant. All investment  managers and
sub-advisors are required by the Securities and Exchange Commission to publicly
disclose their Year 2000 status in December 1998 and June 1999.

American Skandia has initiated formal communications  with parties that provide
third party administration,record keeping and trust services in connection with
its life insurance and qualified retirement plan annuities business. Management
has already  received several written  assurances that these firms will be Year
2000 compliant. The Company expects to have  certifications  from all remaining
parties by August 1999. American  Skandia is currently  developing  contingency
plans in the event that these targets are not met.

Information Technology Systems

American  Skandia is a relatively  young  company  whose  internally  developed
systems  were  designed from the start with four digit year codes.  The Company
engaged  an  external information  technology  specialist  to  review  American
Skandia's operating systems and internally developed  software.  The assessment
was  completed  in  December  1997  and the results  were  favorable.  Specific
modifications  were  suggested,  evaluated  and  implemented  for  the  annuity
administration system. This project was completed during 1998 and a certificate
of  compliance has  been  received.  Other  non-critical  internally  developed
applications in the  client/server area have already been or will be remediated
throughout 1999. The costs  associated with this aspect of Year 2000 compliance
have  not had, and are not  expected  to  have,  a  significant  impact  on the
Company's results from operations.

Suppliers and Non-Information Technology Systems

Like most  companies, American  Skandia  is  reliant on  network,  and  desktop
operating systems and software  providers to release compliant versions of their
respective  systems.  American  Skandia's network  is  currently  at  the  most
compliant level available.  The standard desktop software will be replaced,  as
fully compliant  versions become available. In addition,  the Company is in the
process  of  contacting  the  non-information  systems  vendors  and  suppliers
regarding their Year 2000 compliance status and will factor the results of these
assessments into its contingency plans.

Management believes  it has an  effective  program in place to resolve the Year
2000 issue in a timely manner. However,should errors or disruptions in computer
service  occur,  the  Company  could  realize  losses.  Given  the  nature  and
uncertainty of such losses, the amounts cannot be reasonably determined.



<PAGE>


                   AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
          (a wholly-owned subsidiary of Skandia Insurance Company Ltd.)



ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

There have been no  material changes to the  Company's  market  risk during the
first half of 1999.The Company has provided a discussion of its market risks in
Item 7A of Part II of the December 31, 1998 Form 10-K.


PART II.  OTHER INFORMATION

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

                  (a)      See Exhibit Index
                  (b)      None





<PAGE>


                                    SIGNATURE


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.


                              American Skandia Life
                              Assurance Corporation
                                  (Registrant)


                           by: /s/Thomas M. Mazzaferro
                              Thomas M. Mazzaferro
                          Executive Vice President and
                             Chief Financial Officer



August 10, 1999


<PAGE>


                                    SIGNATURE


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.


                              American Skandia Life
                              Assurance Corporation
                                  (Registrant)


                            by: _____________________
                              Thomas M. Mazzaferro
                          Executive Vice President and
                             Chief Financial Officer



August 10, 1999



<PAGE>


                                  EXHIBIT INDEX




Exhibit
 Number                  Description                               Location


   (2)     Plan of acquisition, reorganization,
           arrangement, liquidation or succession                     None

   (4)     Instruments defining the rights of
           security holders, including indentures                     None

  (10)     Material Contracts                                         None

  (11)     Statement Re:  Computation of per share
           earnings                                                   None

  (15)     Letter Re:  Unaudited interim financial
           information                                                None

  (18)     Letter Re:  Change in accounting
           principles                                                 None

  (19)     Report furnished to security holders                       None

  (22)     Published report regarding matters
           submitted to vote of security holders                      None

  (23)     Consents of experts and counsel                            None

  (24)     Power of attorney                                          None

  (99)     Additional exhibits                                        None