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UNITED STATES
SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

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FORM 10-Q

Registrant meets the conditions set forth in General Instruction H (1)(a) and (b) of Form 10-Q and is therefore filing this Form with
the reduced disclosure format.

|ý                                                 | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 
|------------------------------------------------- | ----------------------------------------------------------------------------------------
|FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2003
|OR                                               
|o                                                 | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
|Commission file number: 333-66452                

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LINCOLN BENEFIT LIFE COMPANY(Exact name of registrant as specified in its charter)

|Nebraska(State of Incorporation)                                                 |  | 47-0221457(I.R.S. Employer Identification No.)
|-------------------------------------------------------------------------------- |  | ----------------------------------------------
|2940 South 84th Street
Lincoln, Nebraska(Address of principal executive offices) |  | 68506(Zip Code)                               
|Registrant's telephone number, including area code:800/525-9287                 

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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the
past 90 days.

Yes ý    No o

Indicate
by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).

Yes o    No ý

As
of October 31, 2003, the registrant had 25,000 common shares, $100 par value, outstanding, all of which are held by Allstate Life Insurance Company.

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LINCOLN BENEFIT LIFE COMPANY
INDEX TO QUARTERLY REPORT ON FORM 10-Q
September 30, 2003

|PART I.  |  | FINANCIAL INFORMATION                                                                                                       |  |   
|-------- |  | --------------------------------------------------------------------------------------------------------------------------- |  | --
|Item 1.  |  | Financial Statements                                                                                                        |  |   
|         |  | Condensed Statements of Operations for the Three-Month and Nine-Month Periods Ended September 30, 2003 and 2002 (unaudited) |  | 1 
|         |  | Condensed Statements of Financial Position as of September 30, 2003 (unaudited) and December 31, 2002                       |  | 2 
|         |  | Condensed Statements of Cash Flows for the Nine-Month Periods Ended September 30, 2003 and 2002 (unaudited)                 |  | 3 
|         |  | Notes to Condensed Financial Statements (unaudited)                                                                         |  | 4 
|Item 2.  |  | Management's Discussion and Analysis of Financial Condition and Results of Operations                                       |  | 9 
|Item 4.  |  | Controls and Procedures                                                                                                     |  | 13
|PART II. |  | OTHER INFORMATION                                                                                                           |  |   
|Item 1.  |  | Legal Proceedings                                                                                                           |  | 13
|Item 6.  |  | Exhibits and Reports on Form 8-K                                                                                            |  | 13

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PART I.    FINANCIAL INFORMATION

Item 1.    Financial Statements

LINCOLN BENEFIT LIFE COMPANY
CONDENSED STATEMENTS OF OPERATIONS

|                                                 |                                   | Three Months Ended
September 30, |       | Nine Months Ended
September 30, |  
|------------------------------------------------ | --------------------------------- | -------------------------------- | ----- | ------------------------------- | -
|
|
|Revenues                                         |                                   |                                  |       |                                 |  
|                                                 | Net investment income             |                                  | $     | 2,782                           |  
|                                                 | Realized capital gains and losses |                                  |       | (66                             | )
|                                                 |                                   |                                  |       |                                 |  
|Income from operations before income tax expense |                                   |                                  | 2,716 |                                 |  
|Income tax expense                               |                                   |                                  | 948   |                                 |  
|                                                 |                                   |                                  |       |                                 |  
|Net income                                       |                                   | $                                | 1,768 |                                 | $
|                                                 |                                   |                                  |       |                                 |  

See
notes to condensed financial statements.

1

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LINCOLN BENEFIT LIFE COMPANY
CONDENSED STATEMENTS OF FINANCIAL POSITION

|(in thousands, except par value data)                                                                  |                                                                               | September 30,
2003 |                                              | December 31,
2002
|------------------------------------------------------------------------------------------------------ | ----------------------------------------------------------------------------- | ------------------ | -------------------------------------------- | -----------------
|
|Assets                                                                                                 |                                                                               |                    |                                              |                  
|Investments                                                                                            |                                                                               |                    |                                              |                  
|                                                                                                       | Fixed income securities, at fair value (amortized cost $193,938 and $182,757) |                    | $                                            | 207,973          
|                                                                                                       | Short-term                                                                    |                    |                                              | 3,681            
|                                                                                                       |                                                                               |                    |                                              |                  
|                                                                                                       |                                                                               | Total investments  |                                              |                  
|Cash                                                                                                   |                                                                               |                    | 37,452                                       |                  
|Reinsurance recoverable from Allstate Life Insurance Company, net                                      |                                                                               |                    | 14,099,720                                   |                  
|Reinsurance recoverable from non-affiliates, net                                                       |                                                                               |                    | 671,802                                      |                  
|Current income taxes receivable                                                                        |                                                                               |                    | 104                                          |                  
|Other assets                                                                                           |                                                                               |                    | 45,234                                       |                  
|Separate Accounts                                                                                      |                                                                               |                    | 1,687,701                                    |                  
|                                                                                                       |                                                                               |                    |                                              |                  
|                                                                                                       |                                                                               |                    | Total assets                                 |                  
|                                                                                                       |                                                                               |                    |                                              |                  
|Liabilities                                                                                            |                                                                               |                    |                                              |                  
|Contractholder funds                                                                                   |                                                                               | $                  | 13,341,578                                   |                  
|Reserve for life-contingent contract benefits                                                          |                                                                               |                    | 1,423,490                                    |                  
|Deferred income taxes                                                                                  |                                                                               |                    | 3,686                                        |                  
|Payable to affiliates, net                                                                             |                                                                               |                    | 15,782                                       |                  
|Other liabilities and accrued expenses                                                                 |                                                                               |                    | 71,321                                       |                  
|Separate Accounts                                                                                      |                                                                               |                    | 1,687,701                                    |                  
|                                                                                                       |                                                                               |                    |                                              |                  
|                                                                                                       |                                                                               |                    | Total liabilities                            |                  
|                                                                                                       |                                                                               |                    |                                              |                  
|Commitments and Contingent Liabilities (Note 3)                                                        |                                                                               |                    |                                              |                  
|Shareholder's equity                                                                                   |                                                                               |                    |                                              |                  
|Common stock, $100 par value, 30 thousand shares authorized, 25 thousand shares issued and outstanding |                                                                               |                    | 2,500                                        |                  
|Additional capital paid-in                                                                             |                                                                               |                    | 130,305                                      |                  
|Retained income                                                                                        |                                                                               |                    | 68,181                                       |                  
|Accumulated other comprehensive income:                                                                |                                                                               |                    |                                              |                  
|                                                                                                       | Unrealized net capital gains and losses                                       |                    |                                              | 9,123            
|                                                                                                       |                                                                               |                    |                                              |                  
|                                                                                                       |                                                                               |                    | Total accumulated other comprehensive income |                  
|                                                                                                       |                                                                               |                    |                                              |                  
|                                                                                                       |                                                                               |                    | Total shareholder's equity                   |                  
|                                                                                                       |                                                                               |                    |                                              |                  
|                                                                                                       |                                                                               |                    | Total liabilities and shareholder's equity   |                  
|                                                                                                       |                                                                               |                    |                                              |                  

See
notes to condensed financial statements.

2

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LINCOLN BENEFIT LIFE COMPANY
CONDENSED STATEMENTS OF CASH FLOWS

|                                     |                                                                                             | Nine Months Ended
September 30,       |                                                                               
|------------------------------------ | ------------------------------------------------------------------------------------------- | ------------------------------------- | ------------------------------------------------------------------------------
|
|
|Cash flows from operating activities |                                                                                             |                                       |                                                                               
|                                     | Net income                                                                                  |                                       | $                                                                             
|                                     | Adjustments to reconcile net income to net cash (used in) provided by operating activities: |                                       |                                                                               
|                                     |                                                                                             | Amortization and other non-cash items |                                                                               
|                                     |                                                                                             | Realized capital gains and losses     |                                                                               
|                                     |                                                                                             | Changes in:                           |                                                                               
|                                     |                                                                                             |                                       | Contract benefit and other insurance reserves, net of reinsurance recoverables
|                                     |                                                                                             |                                       | Income taxes payable                                                          
|                                     |                                                                                             |                                       | Receivable/payable to affiliates, net                                         
|                                     |                                                                                             |                                       | Other operating assets and liabilities                                        
|                                     |                                                                                             |                                       |                                                                               
|                                     |                                                                                             |                                       |                                                                               
|                                     |                                                                                             |                                       |                                                                               
|Cash flows from investing activities |                                                                                             |                                       |                                                                               
|                                     | Fixed income securities                                                                     |                                       |                                                                               
|                                     |                                                                                             | Proceeds from sales                   |                                                                               
|                                     |                                                                                             | Investment collections                |                                                                               
|                                     |                                                                                             | Investment purchases                  |                                                                               
|                                     | Change in short-term investments, net                                                       |                                       |                                                                               
|                                     |                                                                                             |                                       |                                                                               
|                                     |                                                                                             |                                       |                                                                               
|                                     |                                                                                             |                                       |                                                                               
|Net decrease in cash                 |                                                                                             |                                       | (92,797                                                                       
|Cash at beginning of period          |                                                                                             |                                       | 130,249                                                                       
|                                     |                                                                                             |                                       |                                                                               
|Cash at end of period                |                                                                                             | $                                     | 37,452                                                                        
|                                     |                                                                                             |                                       |                                                                               

See
notes to condensed financial statements.

3

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LINCOLN BENEFIT LIFE COMPANY  NOTES TO CONDENSED FINANCIAL STATEMENTS  (unaudited)

1.     Basis of Presentation

The accompanying condensed financial statements include the accounts of Lincoln Benefit Life Company (the "Company"), a wholly owned subsidiary of Allstate Life
Insurance Company ("ALIC"), which is wholly owned by Allstate Insurance Company ("AIC"), a wholly owned subsidiary of The Allstate Corporation (the "Corporation").

The
condensed financial statements and notes as of September 30, 2003, and for the three-month and nine-month periods ended September 30, 2003 and 2002 are
unaudited. The condensed financial statements reflect all adjustments (consisting only of normal recurring accruals) which are, in the opinion of management, necessary for the fair presentation of the
financial position, results of operations and cash flows for the interim periods. These condensed financial statements and notes should be read in conjunction with the financial statements and notes
thereto included in the Lincoln Benefit Life Company Annual Report on Form 10-K for the year ended December 31, 2002. The results of operations for the interim periods should
not be considered indicative of results to be expected for the full year.

Pending accounting standard

Statement of Position 03-01

In July 2003, the American Institute of Certified Public Accountants issued Statement of Position ("SOP") 03-01 entitled "Accounting and
Reporting by Insurance Enterprises for Certain Nontraditional
Long-Duration Contracts and for Separate Accounts." The accounting guidance contained in the SOP addresses three areas: separate accounts presentation and valuation, accounting for sales
inducements such as bonus interest, and the classification and valuation of certain long duration liabilities. The effective date of the SOP is for fiscal years beginning after December 15,
2003, with earlier adoption encouraged.

Based
on management's review of the SOP, the most significant impact to the Company is the provision of the SOP that requires the establishment of a liability in addition to the account
balance for contracts and contract features that provide guaranteed death or other insurance benefits and guaranteed income benefits. This liability will be determined based on models that involve
numerous estimates and subjective judgments, including those regarding expected market rates of return and volatility, contract surrender rates and mortality experience. The Company does not currently
recognize these liabilities. However, any liability recorded would be ceded to ALIC under the terms of the reinsurance agreements. The Company is currently evaluating the provisions of the statement.
The Company plans to adopt the provisions of the statement no later than January 1, 2004 and does not expect the effect to have a material impact on the Condensed Statements of Operations.
Adoption is not expected to have a material impact on the Company's Condensed Statements of Financial Position. However, the amounts may vary based on market conditions.

Proposed standard

Emerging Issues Task Force Topic No. 03-01

The Emerging Issues Task Force ("EITF") discussed Topic No. 03-01, "The Meaning of Other-Than-Temporary Impairment and
Its Application to Certain Investments", which attempts to define other-than-temporary impairment and highlight its application to investment securities accounted for under
both Statement of Financial Accounting Standards ("SFAS") No. 115, "Accounting for Certain Investments in Debt and Equity Securities" and Accounting Principles Board ("APB") Opinion
No. 18, "The Equity Method of Accounting for Investments in Common Stocks". The current issue summary, which has yet to be finalized, proposes that if, at the evaluation date, the fair value of
an investment security is less than its carrying value then an impairment exists for which a determination must be made as to whether that impairment is other-than-temporary.
If it is determined that an impairment is other-than-temporary, then an impairment loss should be recognized equal to the difference between the investment's carrying value and
its fair value at the reporting date. In recent deliberations, the EITF discussed different models to assess whether impairment is other-than-temporary for

4

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different
types of investments (e.g. SFAS 115 marketable equity securities, SFAS 115 debt securities, and equity and cost method investments subject to APB Opinion No. 18). Due to
the uncertainty of the final model or models that may be adopted, the estimated impact to the Company's Condensed Statements of Operations and Financial Position is presently not determinable.

2.     Reinsurance

The Company has reinsurance agreements whereby all premiums, contract charges, interest credited to contractholder funds, contract benefits and certain expenses
are ceded to ALIC and certain non-affiliates and are reflected net of such reinsurance in the Condensed Statements of Operations. The Company follows a comprehensive evaluation process
involving credit scoring and capacity to select reinsurers. Reinsurance recoverable and the related Reserve for life-contingent contract benefits and Contractholder funds are reported
separately in the Condensed Statements of Financial Position. The Company continues to have primary liability as the direct insurer for risks reinsured.

Investment
income earned on the assets which support Contractholder funds and the Reserve for life-contingent contract benefits are not included in the Company's Condensed
Statements of Operations as those assets are owned and managed by ALIC or third party reinsurers under terms of the reinsurance agreements.

The
effects of reinsurance on premiums and contract charges are as follows:

|                              |               | Three Months Ended
September 30,                  |         | Nine Months Ended
September 30, |  
|----------------------------- | ------------- | ------------------------------------------------- | ------- | ------------------------------- | -
|
|Premiums and contract charges |               |                                                   |         |                                 |  
|Direct                        |               | $                                                 | 190,662 |                                 | $
|Ceded                         |               |                                                   |         |                                 |  
|                              | Affiliate     |                                                   |         | (114,074                        | )
|                              | Non-affiliate |                                                   |         | (76,588                         | )
|                              |               |                                                   |         |                                 |  
|                              |               | Premiums and contract charges, net of reinsurance |         | $                               | 
|                              |               |                                                   |         |                                 |  

The
effects of reinsurance on interest credited to contractholder funds, contract benefits and certain expenses are as follows:

|                                                                                  |               | Three Months Ended
September 30,                                                                      |         | Nine Months Ended
September 30, |  
|--------------------------------------------------------------------------------- | ------------- | ----------------------------------------------------------------------------------------------------- | ------- | ------------------------------- | -
|
|Interest credited to contractholder funds, contract benefits and certain expenses |               |                                                                                                       |         |                                 |  
|Direct                                                                            |               | $                                                                                                     | 374,392 |                                 | $
|Ceded                                                                             |               |                                                                                                       |         |                                 |  
|                                                                                  | Affiliate     |                                                                                                       |         | (298,008                        | )
|                                                                                  | Non-affiliate |                                                                                                       |         | (76,384                         | )
|                                                                                  |               |                                                                                                       |         |                                 |  
|                                                                                  |               | Interest credited to contractholder funds, contract benefits and certain expenses, net of reinsurance |         | $                               | 
|                                                                                  |               |                                                                                                       |         |                                 |  

5

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3.     Regulation, Legal Proceedings and Guarantees

Regulation

The Company is subject to changing social, economic and regulatory conditions. State and federal regulatory initiatives and proceedings have varied and have
included efforts to remove barriers preventing banks from engaging in the securities and insurance businesses, to change tax laws affecting the taxation of insurance companies and the tax treatment of
either insurance products or competing non-insurance products that may impact the relative desirability of various personal investment products, and to expand overall regulation. The
ultimate changes and eventual effects, if any, of these initiatives are uncertain.

Legal proceedings

Legal proceedings involving Allstate agencies and AIC may impact the Company, even when the Company is not directly involved, because the Company sells its
products through a variety of distribution channels including Allstate agencies. Consequently, information about the more significant of these proceedings is provided below.

AIC
is defending various lawsuits involving worker classification issues. These lawsuits include a number of putative class actions and one certified class action challenging the
overtime exemption claimed by AIC under the Fair Labor Standards Act or state wage and hour laws. These class actions mirror similar lawsuits filed recently against other carriers in the industry and
other employers. Another lawsuit involves the worker classification of staff working in agencies. In this putative class action, plaintiffs seek damages under the Employee Retirement Income Security
Act ("ERISA") and the Racketeer Influenced and Corrupt Organizations Act alleging that agency secretaries were terminated as employees by AIC and rehired by agencies though outside staffing vendors
for the purpose of avoiding the payment of employee benefits. A putative nationwide class action filed by former employee agents also includes a worker classification issue; these agents are
challenging certain amendments to the Agents Pension Plan and are seeking to have exclusive agent independent contractors treated as employees for benefit purposes. AIC has been vigorously defending
these and various other worker classification lawsuits. The outcome of these disputes is currently uncertain.

AIC
is also defending certain matters relating to its agency program reorganization announced in 1999. These matters include an investigation by the U.S. Department of Labor and a
lawsuit filed in December 2001 by the U.S. Equal Employment Opportunity Commission ("EEOC") with respect to allegations of retaliation under the Age Discrimination in Employment Act, the
Americans with Disabilities Act and Title VII of the Civil Rights Act of 1964. A putative nationwide class action has also been filed by former employee agents alleging various violations of ERISA,
breach of contract and age discrimination.
AIC has been vigorously defending these lawsuits and other matters related to its agency program reorganization. In addition, AIC is defending certain matters relating to its life agency program
reorganization announced in 2000. These matters include an investigation by the EEOC with respect to allegations of age discrimination and retaliation. AIC is cooperating fully with the agency
investigation and will continue to vigorously defend these and other claims related to the life agency program reorganization. The outcome of these disputes is currently uncertain.

The
Company is currently defending a nationwide class action, alleging among other things, breach of contract and breach of the implied covenant of good faith and fair dealing as a
result of a change in the rate and cap on an annuity product. The court certified the class and entered summary judgment in favor of the Company and against the certified class. The Plaintiff filed
notice of appeal and the Company filed a cross appeal. The outcome of the appeal is currently uncertain. The Company has been vigorously defending the suit.

Various
other legal and regulatory actions are currently pending that involve the Company and specific aspects of its conduct of business. Like other members of the insurance industry,
the Company is the target of an increasing number of class action lawsuits and other types of litigation, some of which involve claims for substantial and/or indeterminate amounts (including punitive
and treble damages) and the outcomes of which are unpredictable. This litigation is based on a variety of issues including insurance and claim

6

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settlement
practices. However, at this time, based on their present status and the existence of the reinsurance agreement with ALIC, it is the opinion of management that the ultimate liability, if
any, in one or more of these other actions in excess of amounts currently reserved is not expected to have a material effect on the results of operations, liquidity or financial position of the
Company.

Guarantees

The Company has issued universal life insurance contracts to third parties who finance the premium payments on the universal life insurance contracts through a
commercial paper program. The Company has issued a repayment guarantee on the outstanding commercial paper balance which is fully collateralized by the cash surrender value of the universal life
insurance contracts. At September 30, 2003, the amount due under the commercial paper program is $300 million and the cash surrender value of the policies is $308 million. The
repayment guarantee expires April 30, 2006. These contracts are ceded to ALIC under the terms of the reinsurance agreements.

In
the normal course of business, the Company provides standard indemnifications to counterparties in contracts in connection with numerous transactions, including indemnifications for
breaches of representations and warranties, taxes and certain other liabilities, such as third party lawsuits. The indemnification clauses are often standard contractual terms and were entered into in
the normal course of business based on an assessment that the risk of loss would be remote. The terms of the indemnifications vary in duration and nature. In many cases, the maximum obligation is not
explicitly stated and the contingencies triggering the obligation to indemnify have not occurred and are not expected to occur.
Because the obligated amounts of the indemnifications are not explicitly stated in many cases, the maximum amount of the obligation under such indemnifications is not determinable. Historically, the
Company has not made any material payments pursuant to these obligations.

In
addition, the Company indemnifies its respective directors, officers and other individuals to the extent provided in its charter and by-laws. Since these indemnifications
are generally not subject to limitation with respect to duration or amount, the Company does not believe that it is possible to determine the maximum potential amount due under these indemnifications.

The
aggregate liability balance related to all guarantees was not material as of September 30, 2003.

4.     Other Comprehensive Income

The components of other comprehensive income on a pretax and after-tax basis are as follows:

|                                                            |  | Three Months Ended September 30, |       
|----------------------------------------------------------- |  | -------------------------------- | ------
|
|
|Unrealized capital gains and losses                         |  |                                  |       
|Unrealized holding gains (losses) arising during the period |  | $                                | (4,287
|Less: reclassification adjustments                          |  |                                  | (66   
|                                                            |  |                                  |       
|Unrealized net capital gains (losses)                       |  |                                  | (4,221
|                                                            |  |                                  |       
|Other comprehensive income (loss)                           |  | $                                | (4,221
|                                                            |  |                                  |       
|Net income                                                  |  |                                  |       
|                                                            |  |                                  |       
|Comprehensive income (loss)                                 |  |                                  |       
|                                                            |  |                                  |       

7

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|                                                            |  | Nine Months Ended September 30, |       
|----------------------------------------------------------- |  | ------------------------------- | ------
|
|
|Unrealized capital gains and losses                         |  |                                 |       
|Unrealized holding gains (losses) arising during the period |  | $                               | (2,490
|Less: reclassification adjustments                          |  |                                 | 124   
|                                                            |  |                                 |       
|Unrealized net capital gains (losses)                       |  |                                 | (2,614
|                                                            |  |                                 |       
|Other comprehensive income (loss)                           |  | $                               | (2,614
|                                                            |  |                                 |       
|Net income                                                  |  |                                 |       
|                                                            |  |                                 |       
|Comprehensive income                                        |  |                                 |       
|                                                            |  |                                 |       

5.     Capital Contribution

During the third quarter of 2003, the Executive Committee of ALIC authorized the forgiveness of $3.5 million of intercompany debt that the Company owed to
ALIC. This transaction was recognized as a non-cash capital contribution and reflected in Additional capital paid-in on the Condensed Statements of Financial Position.

8

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Item 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS FOR THE THREE-MONTH AND NINE-MONTH PERIODS ENDED  SEPTEMBER 30, 2003 AND 2002

The following discussion highlights significant factors influencing results of operations and changes in financial position of Lincoln Benefit Life Company (the "Company"). It
should be read in conjunction with the condensed financial statements and notes thereto found under Part I. Item 1. contained herein, and with the discussion, analysis, financial statements and
notes thereto in Part I. Item 1. and Part II. Item 7. and Item 8. of the Lincoln Benefit Life Company Annual Report on Form 10-K for 2002.

Management has identified the Company as a single segment entity.

RESULTS OF OPERATIONS

|                                  |  | Three Months Ended
September 30, |       | Nine Months Ended
September 30, |  
|--------------------------------- |  | -------------------------------- | ----- | ------------------------------- | -
|
|Net investment income             |  | $                                | 2,782 |                                 | $
|Realized capital gains and losses |  |                                  | (66   | )                               |  
|Income tax expense                |  |                                  | 948   |                                 |  
|                                  |  |                                  |       |                                 |  
|Net income                        |  | $                                | 1,768 |                                 | $
|                                  |  |                                  |       |                                 |  

The
Company has reinsurance agreements whereby all premiums, contract charges, interest credited to contractholder funds, contract benefits and certain expenses are ceded to Allstate
Life Insurance Company ("ALIC") and certain non-affiliated reinsurers, and reflected net of such reinsurance in the Condensed Statements of Operations. The Company's results of operations
include net investment income and realized capital gains and losses on the assets of the Company that are not transferred under the reinsurance agreements.

Net incomeincreased $887 thousand in the third quarter of 2003 compared to the same period in 2002 due to decreased realized
capital losses partially offset by decreased Net investment income and higher Income tax expense. Net income increased $733 thousand in the first nine months of 2003 compared to the same period
in 2002 due to realized capital gains in the current period compared to realized capital losses in the prior year period, partially offset by decreased Net investment income and higher Income tax
expense.

Net investment incomedecreased $180 thousand or 6.1% in the third quarter and $219 thousand or 2.5% in the first nine
months of 2003, compared to the same periods last year. The decrease in both periods was due to lower portfolio yields partially offset by increased portfolio balances. Lower portfolio yields result
when new investments are made at rates lower than the current portfolio yields, reflecting the low interest rate
environment. The portfolio balance as of September 30, 2003, excluding unrealized net capital gains on fixed income securities, increased 4.1% from September 30, 2002.

Realized capital losseswere $66 thousand in the third quarter of 2003 compared to $1.6 million in the same period in 2002.
During the first nine months of 2003, realized capital gains were $73 thousand compared to realized capital losses of $1.3 million in the same period in 2002. Realized capital gains and
losses in 2003 resulted from sales of fixed income securities. Realized capital losses in 2002 resulted from write-downs of fixed income securities.

9

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FINANCIAL POSITION

|(in thousands)                                   |                   | September 30, 2003
|------------------------------------------------ | ----------------- | ------------------
|Fixed income securities(1)                       |                   | $                 
|Short-term                                       |                   |                   
|                                                 |                   |                   
|                                                 | Total investments |                   
|                                                 |                   |                   
|Cash                                             |                   | $                 
|Reinsurance recoverable from ALIC, net           |                   |                   
|Reinsurance recoverable from non-affiliates, net |                   |                   
|Contractholder funds                             |                   |                   
|Reserve for life-contingent contract benefits    |                   |                   
|Separate Accounts assets and liabilities         |                   |                   

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Total
investments increased to $211.7 million at September 30, 2003 from $202.6 million at December 31, 2002 due to cash flows from operations partially
offset by decreased unrealized gains on fixed income securities as a result of portfolio management activities.

The
Unrealized net capital gains on fixed income securities at September 30, 2003 were $14.0 million, a decrease of $2.7 million or 16.2% since December 31,
2002. The net unrealized gain for the fixed income portfolio was comprised of $15.0 million of unrealized gains and $1.0 million of unrealized losses at September 30, 2003,
compared to a net unrealized gain for the fixed income portfolio totaling $16.7 million at December 31, 2002, comprised of $16.7 million of unrealized gains and
$38 thousand of unrealized losses. At September 30, 2003, the unrealized losses for the fixed income portfolio were concentrated primarily in the corporate fixed income portfolio.
Corporate fixed income net unrealized gains totaled $5.3 million comprised of $5.8 million of unrealized gains and $568 thousand of unrealized losses. The unrealized losses for
the corporate fixed income portfolio were concentrated in the capital goods and transportation sectors. These sectors comprised $384 thousand or 67.6% of the unrealized losses and
$1.1 million or 18.6%, of the unrealized gains in the corporate fixed income portfolio.

All
of the Company's fixed income securities portfolio are rated investment grade, which is defined by the Company as a security having a rating from the National Association of
Insurance Commissioners ("NAIC") of 1 or 2, a Moody's equivalent rating of Aaa, Aa, A or Baa, a Standard & Poor's equivalent rating of AAA, AA, A or BBB, or a comparable Company internal
rating.

The
Company monitors the quality of its fixed income portfolio, in part, by categorizing certain investments as problem, restructured or potential problem. Problem fixed income
securities are securities in default with respect to principal and/or interest and/or securities issued by companies that have gone into bankruptcy subsequent to the Company's acquisition of the
security. Restructured fixed income securities have modified terms and conditions that were not at current market rates or terms at the time of the restructuring. Potential problem fixed income
securities are current with respect to contractual principal and/or interest, but because of other facts and circumstances, management has serious concerns regarding the borrower's ability to pay
future principal and interest in accordance with the contractual terms of the security, which causes management to believe these securities may be classified as problem or restructured in the future.

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As
of September 30, 2003, the Company did not have any fixed income securities categorized as problem, restructured or potential problem. At December 31, 2002, the
amortized cost and fair value of fixed income securities categorized as problem was $1.8 million and $1.8 million, respectively, and represented 0.9% of the fixed income securities
portfolio. The fixed income securities that were previously categorized as problem were sold during the third quarter of 2003 as a result of price improvements in recent months. While these balances
may increase in the future, particularly if economic conditions continue to be unfavorable, management expects that the total amount of securities in these categories will remain a relatively low
percentage of the total fixed income securities portfolio. The Company did not have any fixed income securities categorized as restructured or potential problem at December 31, 2002.

Reinsurance recoverable, Contractholder funds and Reserve for life-contingent contract benefits

Contractholder funds increased to $13.34 billion at September 30, 2003, from $11.66 billion at December 31, 2002 as a result of
deposits from fixed annuities and interest credited to contractholder funds partially offset by surrenders, withdrawals and benefit payments. The Reserve for life-contingent contract
benefits increased $326.5 million to $1.42 billion at September 30, 2003 resulting from sales of immediate annuities and other life-contingent products, partially
offset by benefits paid. Reinsurance recoverable from ALIC and Reinsurance recoverable from non-affiliates increased correspondingly by $1.92 billion and $88.0 million,
respectively, because all contractholder obligations are reinsured.

The
Company purchases reinsurance after evaluating the financial condition of the reinsurer, as well as the terms and price of coverage. The Company reinsures certain of its risks with
non-affiliated reinsurers under yearly renewable term and coinsurance agreements. Yearly renewable term and coinsurance agreements result in the passing of a portion of the risk to the
reinsurers. Generally, the reinsurer receives a proportionate amount of the premiums less commissions and is liable for a corresponding proportionate amount of all benefit payments.

CAPITAL RESOURCES AND LIQUIDITY

Capital Resourcesconsist of Shareholder's equity. The following table summarizes the Company's capital resources:

|(in thousands)                                               |                            | September 30,
2003 |         | December 31,
2002
|------------------------------------------------------------ | -------------------------- | ------------------ | ------- | -----------------
|Common stock, additional capital paid-in and retained income |                            | $                  | 200,986 |                  
|Accumulated other comprehensive income                       |                            |                    | 9,123   |                  
|                                                             |                            |                    |         |                  
|                                                             | Total Shareholder's equity |                    | $       | 210,109          
|                                                             |                            |                    |         |                  

Shareholder's equityincreased $7.5 million in the first nine months of 2003 when compared to December 31, 2002, due to Net
income of $5.7 million and a capital contribution of $3.5 million partially offset by a decrease in Accumulated other comprehensive income due to decreased unrealized net capital gains
on investments of $1.7 million. During the third quarter of 2003, ALIC, pursuant to authorization by its Executive Committee, forgave $3.5 million of debt owed by the Company. It was
reflected as a non-cash capital contribution to the Company in Additional capital paid-in in the Condensed Statements of Financial Position.

Financial Ratings and StrengthIn June 2003, Standard & Poor's revised the insurance financial strength rating
of ALIC and its rated subsidiaries and affiliates, including the Company, from AA+ to AA and revised the rating outlook from negative to stable. Standard & Poor's stated that the rating change
was due to several factors including their negative outlook on the life insurance industry, the recent decline in ALIC's Net income and their view that a subsidiary's rating cannot exceed the rating
of its parent. ALIC's rating is now the same rating as that of AIC, its parent. Moody's and A.M. Best's financial strength ratings

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of
the Company, ALIC and AIC remain unchanged. In reaffirming the A+ ratings of the Company, ALIC and AIC, A.M. Best assigned a positive outlook for these companies' ratings.

RECENT DEVELOPMENTS

Certain participants in the mutual fund industry have recently been investigated for alleged improper share trading practices. This negative publicity could
potentially harm the confidence of investors in the mutual fund industry and have residual effects on sales of the Company's variable annuity products, which have underlying investments in mutual
funds. Management currently does not expect that any effect on sales from these allegations will have a material impact on the amounts ceded to ALIC or the Condensed Statements of Operations or
Financial Position.

FORWARD-LOOKING STATEMENTS

This document contains "forward-looking statements" that anticipate results based on management's estimates, assumptions and plans that are subject to
uncertainty. These statements are made subject to the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. The Company assumes no obligation to update any
forward-looking statements as a result of new information or future events or developments.

These
forward-looking statements do not relate strictly to historical or current facts and may be identified by their use of words like "plans," "seeks," "expects," "will," "should,"
"anticipates," "estimates," "intends," "believes," "likely," "targets" and other words with similar meanings. These statements may address, among other things, the Company's strategy for growth,
product development, regulatory approvals, market position, expenses, financial results and reserves. Management believes that these statements are based on reasonable estimates, assumptions and
plans. However, if the estimates, assumptions or plans underlying the forward-looking statements prove inaccurate or if other risks or uncertainties arise, actual results could differ materially from
those communicated in these forward-looking statements. Factors which could cause actual results to differ materially from those suggested by such forward-looking statements, include but are not
limited to those discussed or identified in this document (including the risk factor described below) and in the Company's public filings with the SEC.



RISK FACTOR

The following risk factor should be considered in addition to the risk factors identified in the Management's Discussion and Analysis of Financial Condition and
Results of Operations, under the heading "Forward-Looking Statements and Risk Factors Affecting The Company," in Part II Item 7 of the Company's Form 10-K filed March 31, 2003.



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Item 4.    Controls and Procedures

With the participation of our principal executive officer and principal financial officer, we carried out an evaluation of the effectiveness of the design and
operation of our disclosure controls and procedures as of the end of the period covered by this report. Based upon this evaluation, the principal executive officer and the principal financial officer
concluded that our disclosure controls and procedures are effective in timely alerting them to material information required to be included in our periodic reports filed with the Securities and
Exchange Commission. However, the design of any system of controls and procedures is based in part upon assumptions about the likelihood of future events and there can be no assurance that any design
will succeed in achieving its stated goals under all potential future conditions, regardless of how remote. Our disclosure controls and procedures are designed to provide reasonable assurance of
achieving their objectives and are effective at the "reasonable assurance" level.

During
the last fiscal quarter, there have been no changes in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect,
our internal control over financial reporting.

PART II.    OTHER INFORMATION

Item 1.    Legal Proceedings

The discussion "Regulation, Legal Proceedings and Guarantees" in Part I, Item 1, Note 3 of this Form 10-Q is incorporated herein
by reference.

Item 6.    Exhibits and Reports on Form 8-K





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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.

|                  | Lincoln Benefit Life Company
(Registrant)                                                                    
|----------------- | -------------------------------------------------------------------------------------------------------------
|November 14, 2003 | By /s/SAMUEL H. PILCHSamuel H. Pilch
(chief accounting officer and duly
authorized officer of the registrant)

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|Exhibit No. |  | Description                                                
|----------- |  | -----------------------------------------------------------
|31.1        |  | Rule 15d-14(a) Certification of Principal Executive Officer
|31.2        |  | Rule 15d-14(a) Certification of Principal Financial Officer
|32          |  | Section 1350 Certifications                                

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