# United States
Securities
and Exchange Commission
Washington, D.C. 20549

# Form 10-Q

# Quarterly
Report Under Section 13 or 15 (d) of the

Securities Exchange Act of 1934

# For the
Quarter ended March 31, 2004

# Commission
File No. 2-40764

# Kansas City
Life Insurance Company

3520 Broadway

Kansas City, Missouri 64111-2565

# Phone: (816) 753-7000

# IRS Number:
44-0308260

# Incorporated
in the State of Missouri

The Registrant (1) has
filed all reports required to be filed by section 13 or 15 (d) of the Securities
Exchange Act of 1934 during the preceding 12 months, and (2) has been subject to
such filing requirements for the past 90 days.

`Yes    X                       No______`

Indicate the number of
shares outstanding of each of the issuers classes of common stock, as of
the most recent date available.

`Class                                  Outstanding April 29, 2004
Common Stock, $1.25 par value                       11,926,669 shares`

KANSAS CITY LIFE INSURANCE COMPANY
                                                           TABLE OF CONTENTS

`Part I.   Financial Information................................................................................3

Item 1.   Financial Statements.................................................................................3

          Consolidated Balance Sheets..........................................................................3

          Consolidated Statements of Income....................................................................4

          Consolidated Statements of Cash Flows................................................................5

          Notes to Consolidated Financial Statements...........................................................6

Item 2.   Management's Discussion and Analysis of Financial Condition and Results of Operations...............11

Item 3.   Quantitative and Qualitative Disclosures About Market Risk..........................................19

Item 4.   Controls and Procedures.............................................................................20


Part II.  Other Information...................................................................................21

Item 1.   Legal Proceedings...................................................................................21

Item 4.   Results of Votes of Security Holders................................................................21

Item 5.   Other Information...................................................................................22

Item 6.   Exhibits and Reports on Form 8-K....................................................................24

Signatures....................................................................................................25`

## Part I
Financial InformationItem 1.
Financial Statements

KANSAS CITY LIFE INSURANCE COMPANY
               CONSOLIDATED BALANCE SHEETS
        (amounts in thousands, except share data)

`March 31          December 31
                                                                 2004               2003      
ASSETS                                                       (Unaudited)
Investments:
     Fixed maturities available for sale, at fair value   $     2,943,804    $      2,814,485
     Equity securities available for sale, at fair value           64,463              63,808
     Mortgage loans                                               437,292             456,656
     Real estate                                                  115,980             112,691
     Policy loans                                                 112,556             114,420
     Short-term investments                                        50,802              71,823
     Other investments                                                749                 903 
             Total investments                                  3,725,646           3,634,786

Cash                                                                8,090              20,029
Accrued investment income                                          41,464              39,132
Deferred acquisition costs                                        236,633             241,057
Value of business acquired                                        104,387             106,334
Reinsurance recoverable                                           153,116             151,577
Other assets                                                       58,090              54,306
Separate account assets                                           317,356             304,691 
             Total assets                                 $     4,644,782    $      4,551,912 

LIABILITIES
Future policy benefits                                    $       869,354    $        872,114
Policyholder account balances                                   2,258,912           2,239,223
Policy and contract claims                                         35,800              33,012
Other policyholder funds                                          100,889             101,084
Notes payable                                                     130,896             133,670
Income taxes                                                       51,061              36,918
Other liabilities                                                 207,789             186,762
Separate account liabilities                                      317,356             304,691 
             Total liabilities                                  3,972,057           3,907,474 

STOCKHOLDERS' EQUITY
Common stock, par value $1.25 per share
     Authorized 36,000,000 shares,
             issued 18,496,680 shares                              23,121              23,121
Additional paid in capital                                         23,503              23,310
Retained earnings                                                 691,070             688,800
Accumulated other comprehensive income                             49,321              23,418
Less treasury stock, at cost (2004 - 6,569,695 shares;
     2003 - 6,572,087 shares)                                    (114,290)           (114,211)
             Total stockholders' equity                           672,725             644,438 

             Total liabilities and stockholders' equity   $     4,644,782    $      4,551,912`

See accompanying Notes to Consolidated Financial Statements.

KANSAS CITY LIFE INSURANCE COMPANY
                    CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
       (amounts in thousands, except share data)

`Quarter Ended March 31 
                                                               2004             2003 
REVENUES
Insurance revenues:
     Premiums                                           $     47,051     $     47,293
     Contract charges                                         29,149           26,115
     Reinsurance ceded                                       (12,518)         (10,267)
             Total insurance revenues                         63,682           63,141
Investment revenues:
     Net investment income                                    50,727           47,536
     Realized investment gains (losses)                          803          (21,774)
Other revenues                                                 2,534            2,544 
             Total revenues                                  117,746           91,447 

BENEFITS AND EXPENSES
Policyholder benefits                                         50,570           49,763
Interest credited to policyholder account balances            24,309           20,331
Amortization of deferred acquisition costs
     and value of business acquired                            9,746           10,638
Operating expenses                                            25,739           24,971 
             Total benefits and expenses                     110,364          105,703 

Income before income tax expense (benefit)                     7,382          (14,256)

Income tax expense (benefit)                                   1,787           (6,798)

NET INCOME (LOSS)                                       $      5,595     $     (7,458)

Basic and diluted earnings per share:
     Net income (loss)                                  $       0.47     $      (0.62)`

See accompanying Notes to Consolidated Financial Statements.

KANSAS CITY LIFE INSURANCE COMPANY
                    CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
                       (amounts in thousands)

`Quarter Ended March 31     
                                                                              2004               2003   
OPERATING ACTIVITIES
Net cash provided                                                    $         17,152   $        26,493 

INVESTING ACTIVITIES
Purchases of investment securities:
     Fixed maturities                                                        (214,806)         (188,009)
     Equity securities                                                         (1,304)             (839)
Sales of investment securities:
     Fixed maturities                                                          25,055            60,877
     Equity securities                                                            765             4,947
Maturities and principal paydowns of investment securities:
     Fixed maturities                                                         106,657           152,673
     Equity securities                                                            265             2,807
Purchases of other investments                                                (14,262)          (21,732)
Sales, maturities and principal paydowns of other investments                  32,068            24,694
Net sale (purchase) of short-term investments                                  21,021          (101,631)
Net additions to property and equipment                                          (428)             (237)
         Net cash used                                                        (44,969)          (66,450)

FINANCING ACTIVITIES
Proceeds from borrowings                                                          915                 -
Repayment of borrowings                                                        (3,689)           (1,040)
Deposits on policyholder contracts                                             69,236            73,880
Withdrawals from policyholder account balances                                (47,665)          (40,170)
Net transfers to separate accounts                                             (3,213)           (1,456)
Change in other deposits                                                        3,505             8,929
Cash dividends to stockholders                                                 (3,325)           (3,238)
Net disposition (acquisition) of treasury stock                                   114            (1,360)
         Net cash provided                                                     15,878            35,545 

Increase (decrease) in cash                                                   (11,939)           (4,412)
Cash at beginning of year                                                      20,029            14,645 

         Cash at end of period                                      $          8,090   $        10,233`

See accompanying Notes to Consolidated Financial Statements.

Kansas City
Life Insurance Company

Notes to
Consolidated Financial Statements

                                               (amounts in thousands, except share data)

1.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of
Presentation

The unaudited consolidated
financial statements, the accompanying notes to these financial statements and
the accompanying Managements Discussion and Analysis of Operations of
Kansas City Life Insurance Company include the accounts of the Company and its
subsidiaries, principally Sunset Life Insurance Company of America (Sunset
Life), and Old American Insurance Company (Old American). These items have been
prepared in accordance with accounting principles generally accepted in the
United States of America (GAAP) for interim financial reporting and with the
instructions to Form 10-Q of Regulation S-X. Accordingly, they do not include
all of the disclosures required by GAAP for complete financial statements and as
such, these unaudited interim financial statements should be read in conjunction
with the Companys 2003 Form 10-K and the 2003 Annual Report to
Stockholders. Management believes that the disclosures are adequate to make the
information presented not misleading, and all normal and recurring adjustments
necessary to present fairly the financial position at March 31, 2004 and the
results of its operations for all periods presented have been made. The results
of operations for any interim period are not necessarily indicative of the
Companys operating results for a full year.

Significant intercompany
transactions have been eliminated in consolidation and certain reclassifications
have been made to the prior year results to conform with the current years
presentation.

Insurance
Company Acquisition
On June 30, 2003, the Company
acquired all of the issued and outstanding stock of GuideOne Life Insurance
Company (GuideOne) from GuideOne Financial Group, Inc. and GuideOne Mutual
Company. The purchase price of the acquisition was $59.4 million and added
$393.1 million in assets on the acquisition date, including an identifiable
intangible asset called the value of business acquired (VOBA) of $38.0 million.
The financial position and results of operations of GuideOne have been included
in these financial statements on a GAAP basis using the purchase method of
accounting since July 1, 2003. As of October 1, 2003, GuideOne was merged into
Kansas City Life Insurance Company. For segment reporting purposes, GuideOne is
included in the Kansas City Life - Individual segment.

Significant
Accounting Policies

These significant
accounting policies should be read in conjunction with statements and
disclosures made in the Companys 2003 Form 10-K as filed with the United
States Securities and Exchange Commission.

The preparation of the
consolidated financial statements requires management of the Company to make
estimates and assumptions relating to the reported amounts of assets and
liabilities and the disclosure of contingent assets and liabilities at the date
of the consolidated financial statements, and the reported amounts of revenue
and expenses during the period. These estimates are inherently subject to change
and actual results could differ from these estimates.

The Company establishes
liabilities for amounts payable under insurance policies, including traditional
life insurance, annuities and accident and health insurance. Generally, amounts
are payable over an extended period of time and the profitability of the
products is dependent on the assumptions used in the pricing of the products.
Principal assumptions used in pricing policies and in the establishment of
liabilities for future policy benefits are mortality, morbidity, expenses,
persistency, investment returns and inflation. Differences between actual
experience and assumptions used in the pricing of these policies and in the
establishment of liabilities may result in variability of net income.

Policyholder account
balances include universal life insurance, deferred annuity contracts and
investment-type contracts. The account balances for universal life contracts are
equal to cumulative premiums, less contract charges, plus interest credited. The
account balances for deferred annuities and investment contracts are equal to
the cumulative deposits less any applicable contract charges plus interest
credited. The profitability of these products is also dependent on principal
assumptions similar to traditional insurance products, and differences between
actual experience and pricing assumptions may result in variability of net
income.

Deferred acquisition costs
(DAC), principally agent commissions and other selling, selection and issue
costs, which vary with and are directly related to the production of new
business, are capitalized as incurred. These deferred costs are then amortized
in proportion to future premium revenues or the expected future profits of the
business, depending upon the type of product. Profit expectations are based upon
assumptions of future interest spreads, mortality margins, expense margins and
policy and premium persistency experience. These assumptions involve judgment
and are compared to actual experience on an ongoing basis. If it is determined
that the assumptions related to the profit expectations for interest sensitive
and variable insurance products should be revised, the impact of the change is
reported in the current periods income as an unlocking adjustment.

When new business is
acquired, a portion of the purchase price is allocated to a separately
identifiable intangible asset, called the value of business acquired (VOBA).
VOBA is established as the actuarially determined present value of future gross
profits of the business acquired and is amortized in proportion to future
premium revenues or the expected future profits, depending on the type of
business acquired. Similar to DAC, the assumptions regarding future experience
can affect the carrying value of VOBA, including interest spreads, mortality,
expense margins and policy and premium persistency experience. Significant
changes in these assumptions can impact the carrying balance of VOBA and produce
changes that must be reflected in the current periods income as an
unlocking adjustment.

The Company maintains a
diversified securities portfolio. The Companys securities available for
sale are carried at fair value in the Companys balance sheet. The Company
receives fair values for its securities portfolio from a variety of external
sources. Various measures have been taken to manage the portfolios credit
and interest rate risks, as discussed in the Companys 2003 Form 10-K and
the 2003 Annual Report to Stockholders. The Company performs a review of its
securities fair values on an ongoing basis to determine changes in the
value of the portfolio. Several factors are analyzed in evaluating these
securities, including an analysis of the issuing company, its industry,
valuation levels and subsequent developments. Based upon these inputs, the
Company establishes its securities values in accordance with GAAP.

Premiums for traditional
life insurance products are reported as revenue when due. Premiums on accident
and health, disability and dental insurance are reported as earned over the
contract period. A reserve is provided for the portion of premiums written which
relates to unexpired terms of coverage.

Deposits related to
universal life and investment-type products are credited to policyholder account
balances. Revenues from such contracts consist of amounts assessed against
policyholder account balances for mortality, policy administration and surrender
charges, and are recognized in the period in which the services are provided.

In the normal course of
business, the Company cedes risks to other insurers primarily to protect the
Company against adverse fluctuations in mortality experience. The Company also
assumes risks ceded by other companies. Reinsurance is effected on individual
risks and through various pooling arrangements. Business is reinsured primarily
through yearly renewable term and coinsurance agreements. Under yearly renewable
term insurance, the Company pays annual premiums and the reinsurer reimburses
claims paid related to this coverage. Under coinsurance, the reinsurer receives
a proportionate share of the premiums less applicable commissions and is liable
for a corresponding share of policy benefits. The Company remains contingently
liable if the reinsurer should be unable to meet obligations assumed under the
reinsurance contract.

Reinsurance recoverable
includes amounts related to paid benefits and estimated amounts related to
unpaid policy and contract claims, future policy benefits and policyholder
account balances. The cost of reinsurance is accounted for over the terms of the
underlying reinsured policies using assumptions consistent with those used to
account for the policies.

New Accounting
Pronouncements

FASB Interpretation (FIN)
46, Consolidation of Variable Interest Entities, was issued January
2003. This is an interpretation of Accounting Research Bulletin (ARB) No. 51,
Consolidated Financial Statements. This interpretation requires the
consolidation of entities in which an enterprise absorbs a majority of the
entitys expected losses, receives a majority of the entitys expected
residual returns, or both, as a result of ownership, contractual terms or other
financial interests in the entity. This interpretation was adopted July 1, 2003
and had no material impact. Subsequently in December 2003, the FASB issued a
revision known as FIN 46R, which replaces FIN 46. The Company will be required
to apply FIN 46R to variable interest entities created after December 31, 2003.
This revised interpretation was adopted on January 1, 2004, with no material
impact.

Statement of Position (SOP)
03-01, Accounting and Reporting by Insurance Enterprises for Certain
Nontraditional Long-Duration Contracts and for Separate Accounts, was
issued in July 2003 by the Accounting Standards Executive Committee of the
American Institute of Certified Public Accountants. The SOP addresses: 1)
separate account presentation; 2) accounting for an insurance companys
proportionate interest in separate accounts; 3) transfers of assets from the
general account to a separate account; 4) valuation of certain insurance
liabilities and policy features such as guaranteed minimum death benefits and
annuitization benefits; and 5) accounting for sales inducements. This SOP was
adopted on January 1, 2004, with no material impact.

All other Standards and
Interpretations of those Standards issued during 2004 did not relate to
accounting policies and procedures pertinent to the Company at this time.

Comprehensive
Income

Comprehensive income is
comprised of net income and other comprehensive income, which includes
unrealized investment gains or losses on securities available for sale and the
change in the additional minimum pension liability. First quarter comprehensive
income equaled $31.5 million and $16.1 million for 2004 and 2003, respectively.
For the periods presented, comprehensive income varied from net income solely
due to changes in unrealized investment gains and losses on securities, net of
applicable deferred acquisition costs and taxes.

Income Per
Share
Due to the Companys
capital structure and the absence of other potentially dilutive securities,
there is no difference between basic and diluted earnings per common share for
any of the periods reported. The weighted average number of shares outstanding
were 11,925,257 and 11,977,317 for the first quarters of 2004 and 2003,
respectively.

Income Taxes
Deferred income taxes are
recorded on the differences between the tax bases of assets and liabilities and
the amounts at which they are reported in the consolidated financial statements.
Recorded amounts are adjusted to reflect changes in income tax rates and other
tax law provisions as they become enacted. For the first quarter, the effective
tax rate was an expense of 24.2% for 2004, versus a benefit of 47.7% for 2003.
Actual tax rates differ from the enacted rates primarily due to tax credits
received from affordable housing investments and a reversal of taxes accrued
related to a recently closed tax year.

2. SEGMENT
INFORMATION

Company operations have
been classified and summarized into four reportable segments. The segments,
while generally classified along Company lines, are based upon distribution
method, product portfolio and target market. The Parent Company was divided into
two segments. The Kansas City Life - Individual segment consists of sales of
variable life and annuities, interest sensitive products and traditional life
insurance products through a nationwide sales force of independent general
agents. GuideOne is included in the Kansas City Life  Individual Segment.
The Kansas City Life - Group segment consists of sales of group life,
disability, dental products and administrative services only. Group
segment products and services are marketed by a nationwide sales force of
independent general agents and group brokers, along with third party marketing
arrangements. The Sunset Life segment consists of sales of interest sensitive
and traditional products through a nationwide sales force of independent general
agents. The Old American segment sells final expense insurance products
nationwide through its general agency system, using direct response marketing to
supply agents with leads in their exclusive territories.

Separate investment
portfolios are maintained for each of the companies. However, investments are
allocated to the group segment based upon its cash flows. Its investment income
is modeled using the year of investment method. Home office functions are fully
integrated for the three companies in order to maximize economies of scale.
Therefore, operating expenses are allocated to the segments based upon internal
cost studies, which are consistent with industry cost methodologies.

Inter-segment revenues are
not material. The Company operates solely in the United States and no individual
customer accounts for 10% or more of the Companys revenue.

The following schedule
provides, in thousands, the financial performance of each of the four reportable
operating segments of the Company.

`Kansas City Life       Sunset        Old
                                    Individual      Group      Life       American      Total
                                    ----------      -----      ----       --------      -----
Insurance revenues:
           First quarter:
                           2004  $    31,646   $   11,024    $ 3,950     $ 17,062    $  63,682

                           2003       30,009       11,423      4,290       17,419       63,141

Net investment income:
           First quarter:
                           2004  $    40,405   $       80    $ 6,964     $  3,278    $  50,727

                           2003       36,098           80      7,602        3,756       47,536

Net income (loss):
           First quarter:
                           2004  $     3,949   $     (310)   $ 1,350     $    606    $   5,595

                           2003       (5,424)        (985)       (63)        (986)      (7,458)`

3. CONTINGENT
LIABILITIES

The life insurance
industry, including the Company, has been subject to an increase in litigation
in recent years. Such litigation has been pursued on behalf of purported classes
of policyholders and other claims and legal actions in jurisdictions where
juries often award punitive damages which are grossly disproportionate to actual
damages. Although no assurances can be given and no determinations can be made
at this time, management believes that the ultimate liability, if any, with
respect to these claims and actions, would have no material effect on the
Companys business, results of operations and financial position.

4. GUARANTEES
AND INDEMNIFICATIONS

The Company is subject to various
indemnification obligations issued in conjunction with certain transactions,
primarily assumption reinsurance agreements, stock purchase agreements, mortgage
servicing agreements and borrowing agreements whose terms range in duration and
often are not explicitly defined. Generally, a maximum obligation is not
explicitly stated; therefore, the overall maximum amount of the obligation under
the indemnifications cannot be reasonably estimated. While we are unable to
estimate with certainty the ultimate legal and financial liability with respect
to these indemnifications, we believe the likelihood is remote that material payments would be required
under such indemnifications and therefore such indemnifications would not result
in a material adverse effect on our business, financial position or results of
operations.

## Item 2.
Managements Discussion and Analysis of Financial Condition and Results of
Operations

## Cautionary
Statement on Forward-Looking Information

This report reviews the
Companys financial condition and results of operations, and historical
information is presented and discussed. Where appropriate, factors that may
affect future financial performance are also identified and discussed. Certain
statements made in this report include forward-looking statements
that fall within the meaning of the Private Securities Litigation Reform Act of
1995. Forward-looking statements include any statement that may predict,
forecast, indicate or imply future results, performance or achievements instead
of historical facts and may contain words like believe,
expect, estimate, project,
forecast, anticipate, plan,
will, shall, and other words, phrases or expressions
with similar meaning.

Forward-looking statements
are subject to known and unknown risks, uncertainties and other factors that may
cause actual results to differ materially from those contemplated by the
forward-looking statements. Factors that could cause the Companys future
results to differ materially from expected results include, but are not limited
to:

- Changes in general
economic conditions, including the performance of financial markets and interest
rates;
- Increasing competition, which may affect the Companys ability to
sell its products;
- Customer and agent response to new products, distribution
channels and marketing initiatives;
- Fluctuations in experience regarding
current mortality, morbidity, persistency and interest rates relative to
expected amounts used in pricing the Company's products;
- Changes in assumptions related to deferred acquisition costs and the value of business acquired;
- Regulatory, accounting or
tax changes that may affect the cost of, or the demand for, the Companys
products or services;
- Unanticipated changes in industry trends and ratings
assigned by nationally recognized rating organizations.

The Company cannot give
assurances that such statements will prove to be correct. Given these risks and
uncertainties, investors should not place undue reliance on forward-looking
statements as a prediction of actual results.

## Consolidated
Results of Operations

In the first quarter of
2004, the Companys net income increased $13.1 million versus the prior
year, to a total of $5.6 million. Net income per share increased to $0.47,
compared with a net loss per share of $0.62 in last years first quarter.
The largest factor in the increase was the improvement in realized investment
gains and losses. The Company recorded realized investment gains of $0.8
million, a $22.6 million increase over last years realized investment
losses. This improvement was the result of a general improvement in the overall
market, but particularly in the airline sector. Partially offsetting this
improvement was an increase in interest credited on policyholder account
balances of $4.0 million, primarily the result of the GuideOne acquisition and a
$0.8 million increase in policyholder benefits due to an increase in mortality.

Sales
The Company measures sales
in terms of new premiums and deposits. Premiums are included in insurance
revenues in the Consolidated Statements of Income, while deposits are shown in
the Consolidated Statements of Cash Flows. The first table below reconciles the
premiums included in insurance revenues and provides detail by new and renewal
business. New premiums are also detailed by product. The second table below
reconciles deposits with the Consolidated Statements of Cash Flows and provides
detail by new and renewal deposits. New deposits are also detailed by product.

New premiums decreased 5%
versus last year, primarily due to a 58% decrease in the sale of immediate
annuities. Sales of annuity products slowed during the second half of 2003,
consistent with the results during the first quarter of 2004. Individual life
insurance sales increased 39% over the prior year. Group life sales increased
48%, and group accident and health grew 68% as its third party marketing
arrangements have generated strong sales in the long-term disability line. In
addition, the group segment reintroduced a stop loss product in late 2003, which
had the effect of improving revenues for the first quarter 2004. Renewal
premiums grew 1% in the first quarter versus a year ago, largely due to the
acquisition of GuideOne.

`Quarter Ended March 31
                                             -------------------------------------------
                                                  2004     % chg       2003     % chg
                                             -------------------------------------------
New premiums:
    Individual life insurance               $    3,484        39    $  2,514      (20)
    Immediate annuities                          2,878       (58)      6,825      830
    Group life insurance                           417        48         281        6
    Group accident and health insurance          3,820        68       2,275      (15)
    Individual accident and health insurance       642         -          -         -
                                             -------------          -----------
       Total new premiums                       11,241        (5)     11,895       75
Renewal premiums                                35,810         1      35,398       (5)
                                             -------------          -----------
Total premiums                              $   47,051        (1)  $  47,293        7
                                             =============          ===========`

New deposits decreased 26%
during the first quarter, largely due to a 35% decrease in fixed annuity sales.
New deposits on universal life products increased 1%. Variable annuity deposits
increased 7%, but were offset by a 45% decrease in variable universal life
deposits. Despite an improving economy, interest sensitive products continue to
be favored by consumers as they seek safety combined with consistent returns.
Renewal deposits grew 17%, primarily due to contracts received in the GuideOne
acquisition.

`Quarter Ended March 31
                                             -------------------------------------------
                                                2004     % chg        2003     % chg
                                             -------------------------------------------
New deposits:
    Universal life insurance               $     2,241      1     $   2,220       8
    Variable universal life insurance              631    (45)        1,152     (49)
    Fixed annuities                             19,537    (35)       30,063      81
    Variable annuities                           7,194      7         6,714       9
                                             -------------        -------------
       Total new deposits                       29,603    (26)       40,149      49
Renewal deposits                                39,633     17        33,731      (6)
                                             -------------        -------------
Total deposits                             $    69,236     (6)    $  73,880      17
                                             =============        =============`

Insurance Revenues
Insurance revenues consist
of premiums and contract charges, less reinsurance ceded. Insurance revenues
increased 1% or $0.5 million in the first quarter. Overall premiums decreased 1%
in the first quarter due to the decrease in annuities. Contract charges earned
in the first quarter increased 12%, largely due to the addition of
GuideOnes portfolio of universal life and annuity products. Reinsurance
ceded has increased from $10.3 million in the first quarter of 2003 to $12.5
million in 2004. The Company has expanded its use of reinsurance over the past
few years, particularly in group accident and health products. In addition, the
GuideOne acquisition accounted for 31% of the growth in reinsurance premiums
paid in the first quarter.

The volatility of the
equity markets continues to influence consumers preferences favorably
toward interest sensitive products and more traditional life and annuity
insurance products. Consumers continue to desire a broad portfolio of products
with safety and competitive return objectives, which the Company strives to
provide. Variable insurance products allow policyholders to participate in both
the equity and fixed income markets; interest sensitive and traditional
insurance products combine safety of principal with competitive interest
returns.

Insurance revenues may be
affected by the persistency of policyholders, which may be influenced by
economic conditions as well as competitive forces and fluctuations in mortality
experience. The Companys persistency and mortality experience have been
consistent with expectations over time.

Investment Revenues
Net investment income
increased 7% in the first quarter to $50.7 million, an increase of $3.2 million
over first quarter 2003. This increase was due to additional invested assets,
largely from the acquisition of GuideOne and strong sales, partially offset by a
decline in interest rates.

As discussed above, the
Company recorded realized investment gains of $0.8 million, a $22.6 million
increase over last years realized investment losses. The following table
provides detail concerning realized investment gains and losses for the first
quarters of 2004 and 2003.

`Quarter Ended
                                                      March 31
                                             --------------------------
Realized Investment Gains and Losses              2004         2003
                                             ----------- --------------
Gross gains resulting from:
   Sales of investment securities            $   2,765    $   1,606
   Investment securities called                    308          371
   Sales of real estate                            286          166
                                             ----------- --------------
     Total gross gains                           3,359        2,143
                                             ----------- --------------
Gross losses resulting from:
   Sales of investment securities               (1,706)      (5,108)
   Write-downs of investment securities              -      (18,631)
   Investment securities called                   (915)        (174)
                                             ----------- --------------
     Total gross losses                         (2,621)     (23,913)
Amortization of deferred acquisition costs          65           (4)
                                             ----------- --------------
Realized investment gains (losses)           $     803    $ (21,774)
                                             =========== ==============`

The Company regularly
evaluates the quality of its investment portfolio. Occasionally, in a
diversified portfolio, certain investments may suffer market price deterioration
due to a wide variety of factors. Distressed securities are placed onto watch
lists that are then further analyzed to identify any specific securities that
the Company believes may have experienced other than temporary declines in fair
value. To the extent that the Company believes that these fluctuations represent
an other than temporary decline in value, the value of the investment is
adjusted by charging off the loss against income. For the first quarter of 2004
the Companys analysis did not identify any other than temporary declines
in value. In the first quarter of 2003, the Company recorded $18.6 million in
other than temporary declines in value, which were primarily due to investments
in the airline industry.

Policyholder Benefits and Interest Credited to Policyholder Account Balances
Policyholder benefits and
interest credited to policyholder account balances increased 7% or $4.8 million
in the first quarter 2004, versus the prior year. This increase was largely the
result of interest credited on policyholder account balances of approximately $280 million, which were received
in the GuideOne acquisition.
In addition, an increase in mortality on life business, primarily in the Kansas
City Life Individual Insurance business segment, was partially offset by lower
policyholder benefits in the other business segments. Actual mortality
experience will fluctuate within short periods of time but over longer periods
has historically been within long-range assumptions used to determine product
pricing and reserving for future policy benefits.

Deferred Acquisition Costs (DAC) and Value of Business Acquired (VOBA)
The amortization of DAC was
$7.8 million and $9.0 million the first quarters of 2004 and 2003, respectively.
The amortization of VOBA was $1.9 million in first quarter of 2004 and $1.6
million in first quarter 2003. Additionally, VOBA was established on June 30,
2003 at $38.0 million due to the acquisition of GuideOne.

Operating ExpensesInsurance operating
expenses increased 3% in the first quarter of 2004. The largest factor in this
increase was the inclusion of operating expenses of GuideOne.

Income TaxesThe effective income tax
rate was an expense of 24.2% for the first quarter of 2004 versus a benefit of
47.7% for the prior year period. The income tax rate in both years was affected
by tax credits generated from the Companys investments in affordable
housing. Also, in 2003 the Company benefited from the reversal of taxes accrued
related to a recently closed tax year.

## Operating
Results by Segment

The following schedules
provide key supplemental financial information for each of the Companys
four reportable operating segments for the first quarters of 2004 and 2003 and
are reconciled to the financial statements contained herein (in thousands):

`Kansas City Life               Sunset            Old
                                               Individual         Group             Life          American          Total
                                               ----------         -----             ----          --------          -----
2004 (first quarter):
Premiums:
    New premiums                         $       5,349      $    4,237        $      111        $    1,544       $  11,241
    Renewal premiums                             8,347           9,152             1,401            16,910          35,810
                                           ----------------- ---------------- --------------- --------------- ---------------
Total premiums                                  13,696          13,389             1,512            18,454          47,051
Contract charges                                23,427               -             5,722                 -          29,149
Reinsurance ceded                               (5,477)         (2,365)           (3,284)           (1,392)        (12,518)
                                           ---------------  ---------------   -------------    ------------    ------------
    Total insurance revenues             $      31,646      $   11,024        $    3,950        $   17,062       $  63,682
                                           ----------------- ---------------- --------------- --------------- ---------------

Net investment income                           40,405              80             6,964             3,278          50,727
Realized investment gains (losses)                 768               -              (145)              180             803
Other revenues                                   1,429             687               398                20           2,534

Policyholder benefits and interest credited
    to policyholder account balances            49,179           7,354             6,226            12,120          74,879

Expenses and taxes                              21,120           4,747             3,591             7,814          37,272
                                           ----------------- ---------------- --------------- --------------- ---------------

Net income (loss)                        $       3,949       $    (310)       $    1,350        $      606      $    5,595
                                           ================= ================ =============== =============== ===============

Deposits:
    New deposits                                28,530               -             1,073                 -          29,603
    Renewal deposits                            31,483               -             8,150                 -          39,633
                                           ---------------  ---------------   -------------    ------------    ------------
Total deposits                           $      60,013       $       -        $    9,223        $        -      $   69,236
                                          ----------------- ---------------- --------------- --------------- ---------------`

`Kansas City Life               Sunset            Old
                                               Individual         Group             Life          American          Total
                                               ----------         -----             ----          --------          -----
2003 (first quarter):
Premiums:
    New premiums                         $       7,597       $    2,556       $      275        $    1,467      $   11,895
    Renewal premiums                             6,256           10,149            1,392            17,601          35,398
                                           ----------------- ---------------- --------------- --------------- ---------------
Total premiums                                  13,853           12,705            1,667            19,068          47,293
Contract charges                                20,355                -            5,760                 -          26,115
Reinsurance ceded                               (4,199)          (1,282)          (3,137)           (1,649)        (10,267)
                                           ---------------  ---------------   -------------    ------------    ------------
    Total insurance revenues             $      30,009       $   11,423       $    4,290        $   17,419      $   63,141
                                           ----------------- ---------------- --------------- --------------- ---------------

Net investment income                           36,098               80            7,602             3,756          47,536
Realized investment gains (losses)             (16,310)               -           (3,495)           (1,969)        (21,774)
Other revenues                                   1,613              789              131                11           2,544

Policyholder benefits and interest credited
    to policyholder account balances            42,100            8,366            6,065            13,563          70,094

Expenses and taxes                              14,734            4,911            2,526             6,640          28,811
                                           ----------------- ---------------- --------------- --------------- ---------------

Net loss                                  $     (5,424)      $     (985)      $      (63)       $     (986)     $   (7,458)
                                           ================= ================ =============== =============== ===============

Deposits:
    New deposits                                33,513                -            6,636                 -          40,149
    Renewal deposits                            26,881                -            6,850                 -          33,731
                                           ---------------  ---------------   -------------    ------------    ------------
Total deposits                            $     60,394       $        -       $   13,486        $        -      $   73,880
                                           --------------- ---------------- --------------- --------------- ---------------`

Kansas City Life Insurance Company - Individual InsuranceInsurance revenues for this
segment increased 6% in the first quarter. Excluding GuideOne, insurance
revenues decreased 10% in the first quarter. New premiums decreased 30% in the
first quarter compared with a year ago, primarily due to a 58% decrease in new
sales of immediate annuity premiums. Partially due to the GuideOne acquisition,
individual life premiums increased 105% and individual accident and health
premiums also increased.

New deposits decreased 15%,
reflecting the decrease in deferred annuities. Universal life deposits increased
34%. Variable annuity deposits increased 7%, but were offset by a 45% decrease
in new variable universal life deposits.

Contract charges increased
15% in first quarter 2004, largely due to the addition of the GuideOne portfolio
of universal life and annuity products.

Net investment income for
this segment grew 12% for the first quarter 2004. This increase reflects the
growth in investable assets from the prior year due to the GuideOne acquisition
and sales growth. Realized investment gains totaled $0.8 million in the first
quarter, a $17.1 million improvement over the realized investment loss in 2003.

Policyholder benefits and
interest credited to policyholder account balances increased 17% in the first
quarter 2004, largely due to interest credited on business received in the
GuideOne acquisition and increased mortality. Other benefits, which are included
in policyholder benefits, increased 71%, reflecting increased benefits for
annuities and supplemental contracts, but were largely offset by related reserve
decreases. The change in other benefits is largely due to the acquisition of
GuideOne. Surrender benefits, which are part of policyholder benefits, increased
21% in the first quarter, but was also offset by a reserve decrease. These
benefits generally tend to follow interest rate fluctuations. The interest rate
environment has generally increased over a year ago and as such, this benefit
has increased.

Net income for this segment
increased from a $5.4 million loss in the first quarter of 2003 to $3.9 million
of income in the first quarter of 2004. This improvement was largely due to the
change in realized investment gains and losses, as discussed above.

Kansas City Life Insurance Company - Group InsuranceInsurance revenues for the
Group insurance segment decreased 4% in the first quarter. This was attributable
to lower premiums in the dental line, which experienced the loss of a third
party marketing arrangement at December 31, 2003. However, new group life
premiums increased 48%, reflecting strong sales from the independent group
agents. In addition, the Companys third party marketing arrangements have
resulted in strong sales of accident and health insurance products. Premiums
from the long-term disability line increased $1.0 million over last year. The
stop loss line was reintroduced in late 2003 and generated $0.6 million in
premiums in the first quarter 2004.

Policyholder benefits
decreased 12% in the first quarter of 2004, due to an increase in reinsurance
ceded benefits in group life insurance. Overall, the claims ratio (total
benefits divided by total insurance revenues) for this segment improved versus
last year, moving from 73% in 2003 to 67% in 2004.

The net loss in operating
results narrowed from $1.0 million for the first quarter 2003 to $0.3 million
for the first quarter of 2004.

Sunset Life Insurance Company of America
Insurance revenues for this
segment decreased 8% in the first quarter. Total life and annuity premiums
decreased 9% in the first quarter, largely due to reduced immediate annuity
sales.

Policyholder benefits
increased 3% in first quarter 2004. This increase is primarily the result of an
increase in death benefit payments, net of reinsurance.

Net income for this segment
was $1.4 million in the first quarter, compared to a $0.1 million loss last
year. The primary reason for this change was reduced realized investment losses,
which moved from a loss of $3.5 million in 2003 to a loss of $0.1 million in
2004.

Old American Insurance CompanyInsurance revenues
decreased 2% in the first quarter. New life premiums in this segment grew 5%
over last year, continuing the pace from last year. Policyholder benefits
decreased 11% versus a year ago in part due to the decrease in claims liabilities.

Net income for this segment
was $0.6 million in the first quarter, versus a loss of $1.0 million a year ago.
This change was due to the change in realized investment gains and losses, which
moved from a loss of $2.0 million in 2003 to a gain of $0.2 million in 2004.

## Liquidity and
Capital Resources

LiquidityStatements made in the
Companys Form 10-K and the 2003 Annual Report to Stockholders remain
pertinent, as the Companys liquidity position is materially unchanged from
year-end.

The Company and each
insurance subsidiary meets liquidity requirements primarily through positive
cash flows from its operations. The Company has sufficient sources of liquidity
to satisfy operational requirements. Primary sources of cash flow are premiums,
other insurance considerations and deposits, receipts for policyholder accounts,
investment sales and maturities, investment income and access to credit from
other financial institutions. The principal uses of cash are for the insurance
operations, including the purchase of investments, payments of insurance
benefits, operating expenses, withdrawals from policyholder accounts, costs
related to acquiring new business, dividends and income taxes.

Cash provided from
operations totaled $17.2 million at March 31, 2004, down from $26.5 million a
year ago. This decrease is primarily due to an increase in policyholder benefit
payments, including the addition of GuideOne, and increases in reinsurance ceded
paid on premium receipts, operating expenses and reinsurance receivables. Net
cash used in investing activities was $45.0 million in the first quarter 2004
versus $66.5 million in 2003. The decrease is largely due to a decrease in sales
and calls of fixed maturity securities.

Net cash provided from
financing activities was $15.9 million in 2004, versus $35.5 million in 2003.
This decrease is primarily the result of three factors, including a decrease in
deposits on policyholder contracts, an increase in policyholder withdrawals, and
a decrease in deposits from other sources. Net borrowings totaled $130.9 million
at March 31, 2004, down $2.8 million from year-end 2003.

Asset and liability
maturities and yields are closely managed and exposure to changing interest
rates is minimized so that funds will be available as needed to meet future
policyholder obligations. Cash flow testing is performed to ensure sufficient
interest spreads are earned.

This information excludes
net proceeds from variable insurance products. These proceeds are segregated
into separate accounts and are not held in the Companys general
investments because the policyholders, rather than the Company, assume the
underlying investment risks.

Debt and short-term borrowingThe Company and certain
subsidiaries have access to borrowing capacity through their membership
affiliation with the Federal Home Loan Bank. At year-end, outstanding balances
under this agreement totaled $109.3 million in maturities of less than one year.
The primary purpose for these borrowings is to ensure access to liquidity. This
is accomplished through the purchase of highly liquid, marketable securities
from the proceeds of these borrowings.

The Company established a
two-year note payable for $2.0 million associated with the GuideOne purchase,
due in June 2005. Outstanding borrowings of $18.6 million are related to the
conversion of certain real estate joint ventures to tenant in common real estate
ownership in the fourth quarter of 2003. The Company has two construction loans
related to investment properties totaling $1.0 million.

The Company has unsecured
revolving lines of credit of $60 million with two major commercial banks with no
balances outstanding.

Capital resourcesThe Company considers
existing capital resources to be more than adequate to support the current level
of business activities.

The following table shows
the capital adequacy for the Company.

`March 31        December 31
                                       --------------   ---------------
                                           2004              2003
                                       --------------   ---------------
Total assets less separate accounts  $     4,327,426  $      4,247,221
Total stockholders' equity                   672,725           644,438
Ratio of stockholders' equity
   to assets less separate accounts              16%               15%`

The ratio of equity to
assets less separate accounts has remained relatively constant. Unrealized
investment gains on available for sale securities, which are included as a part
of stockholders equity, increased $49.6 million in the first quarter. This
compares to an $82.8 million increase for the entire year in 2003 and a $37.6
million increase in the first quarter 2003. These changes reflect lower interest
rates and improving credit markets.

Stockholders equity
increased $28.3 million from year-end. Accumulated other comprehensive income
increased $25.9 million from year-end, reflecting the increase in unrealized
investment gains on securities. Consolidated book value per share equaled $56.40
at March 31, 2004, a 4% increase from year-end 2003.

During the first quarter of
2004, the Company did not purchase any of its shares under the stock repurchase
program. Under this program, the Company may purchase up to one million shares
on the open market during 2004.

On April 26, 2004, the
Board of Directors declared a quarterly dividend of $0.27 per share, unchanged
from last year, that will be paid May 24, 2004 to stockholders of record as of
May 10, 2004.

Current legislative
activities are not expected to have a significant impact on the ongoing
operations of the Company.

Item 3.
Quantitative and Qualitative Disclosures About Market Risk

Statements made in the
Companys Form 10-K and the 2003 Annual Report to Stockholders regarding
the market and interest rate risk analysis remain pertinent.

The Company holds a
diversified portfolio of investments that includes cash, bonds, preferred
stocks, mortgage-backed securities, commercial mortgages and real estate. Each
of these investments is subject, in varying degree, to market risks that can
affect their return and their fair value. A majority of these assets are debt
instruments of corporations or U.S. Government Sponsored Enterprises (GSE) and
are considered fixed income investments. Thus, the primary market risks
affecting the Companys portfolio are interest rate risk, credit risk and
liquidity risk.

Interest rate risk arises
from the price sensitivity of investments to changes in interest rates. Coupon
and dividend income represent the greatest portion of an investments total
return for most fixed income instruments in stable interest rate environments.
The changes in the fair market price of such investments are inversely related
to changes in market interest rates. As interest rates fall, the coupon and
dividend streams of existing fixed rate investments become more valuable and
market values rise. As interest rates rise, the opposite effect occurs.

Market changes rarely
follow a linear pattern in one direction for any length of time. Within any
diversified portfolio, an investor will likely find embedded options, both puts
and calls, that change the structure of the cash flow stream. Mortgage-backed
securities are particularly sensitive to interest rate changes. As long-term
interest rates fall, homeowners become more likely to refinance their mortgage
or move up to a larger home, causing a prepayment of the outstanding mortgage
principal, which must then be reinvested at a lower rate. Should interest rates
rise suddenly, prepayments expected by investors may decrease, extending the
duration of a mortgage pool. This represents a further interest rate risk to
investors.

As interest rates rise,
policyholders may become more likely to surrender policies or to borrow against
cash values, often to meet sudden needs in an inflationary environment or to
invest in higher yielding opportunities elsewhere. This risk of
disintermediation may force the Company to liquidate parts of its portfolio at a
time when the fair market value of fixed income investments is falling. If
interest rates fall, the Company may also be forced to invest new cash receipts
at levels below the minimum guaranteed rates payable to policyholders, eroding
profit margins. The Company can usually adapt to small sudden changes in
interest rates, or even large changes that occur over longer periods of time.
Cash flow may increase or decrease over the course of the business cycle.
Therefore, the Company takes steps to ensure that adequate liquidity is
available to meet obligations in a timely manner. To this end, the Company
maintains lines of credit with commercial banks and other short-term borrowing
arrangements with financial institutions.

The majority of the
Companys investments are exposed to varying degrees of credit risk. Credit
risk is the risk that the value of the investment may decline due to
deterioration in the financial strength of the issuer and that the timely
payment of principal or interest might not occur.

Over the past three years,
credit defaults in the marketplace have increased significantly relative to
historical norms. The increase in the default rate has been attributed to
several factors, including the economic slowdown experienced by the U.S.
economy, the increased use of leverage by corporate issuers, fraud and adverse
legal judgments against corporations, among others. A default by a rated issuer
usually involves some loss of principal to the investor, as evidenced by the
write-downs taken by the Company. Losses can be mitigated by timely sales of
affected securities or by active involvement in a restructuring process.
However, there can be no assurance that the efforts of an investor will lead to
favorable outcomes in a bankruptcy or restructuring.

The Company mitigates
credit risk by diversifying the investment portfolio across a broad range of
issuers, investment sectors and security types, and by limiting the amount
invested in any particular entity. With the exception of certain GSEs,
there is no exposure to any single issuer greater than one percent of assets on
a book value basis. The Company also invests in securities carrying a lien
against physical assets. These securities can improve the likelihood of payment
according to contractual terms and increase recovery amounts in the case of
bankruptcy or restructuring.

As market interest rates
fluctuate, so will the value of the Companys investment portfolio and its
stockholders equity. At March 31, 2004, the Company had an unrealized
investment gain of $72.8 million, net of related taxes, policyholder account
balances and deferred policy acquisition costs, compared to $46.9 million at
year-end 2003. This increase is primarily the result of changes in the term
structure of interest rates, volatility in credit spreads within the corporate
bond market, and the realization of losses on certain securities. The Company
continues its practice of the limited use of derivatives as a form of risk
mitigation.

The Company markets certain
variable products. The policyholder assumes essentially all the investment
earnings risk for the portion of the account balance invested in the separate
accounts. However, the Company assesses certain charges based on the policy
account values and changes to the account values can affect the Companys
earnings. The portion of the policyholders account balance invested in the
fixed general account, if any, is affected by the spreads between interest
yields on investments and rates credited to the policyholders accounts.

Item 4.
Controls and Procedures

(a) Evaluation of disclosure  controls and  procedures.  The Chief Executive  Officer and Chief  Financial  Officer of Kansas City Life
Insurance  Company have  concluded,  based on their  evaluation as of the end of the period covered by this report,  that the Company's
disclosure  controls and procedures are effective for gathering,  analyzing and disclosing the  information  the Company is required to
disclose in the Company's reports under the Securities Exchange Act of 1934.

(b) Changes in internal  controls.  There were no significant  changes in the Company's  internal controls over financial  reporting or
in other  factors that could  significantly  affect those  controls made during the quarter  covered by this report,  that have, or are
reasonably likely to materially affect the Company's internal control over financial reporting.

## Part II: Other
Information

Item 1. Legal
Proceedings

The life insurance
industry, including the Company and its subsidiaries, has been subject to an
increase in litigation in recent years. Such litigation has been pursued on
behalf of purported classes of insurance purchasers, often questioning the
conduct of insurers in the marketing of their products.

In addition to the above,
the Company and its subsidiaries are defendants in, or subject to other claims
or legal actions. Some of these claims and legal actions are in jurisdictions
where juries are given substantial latitude in assessing damages, including
punitive damages. Although no assurances can be given and no determinations can
be made at this time, management believes that the ultimate liability, if any,
with respect to these other claims and legal actions would have no material
effect on the Companys business, results of operations or financial
position.

Item 4.
Results of Votes of Security Holders

On April 22, 2004, the
Annual Stockholders Meeting was held at 3520 Broadway, Kansas City, Missouri. At
this meeting, there were 11,926,985 shares outstanding and eligible to vote, and
10,309,650 shares were represented at the meeting either in person or by proxy.

The following Directors
received the number of votes indicated and were elected for a three year term:

`William R. Blessing                  10,366,757
                 Cecil R. Miller                      10,361,312
                 Bruce W. Gordon                       9,806,221
                 Bradford T. Nordholm                 10,372,700
                 Richard L. Finn                      10,373,905`

The following Directors continued
their term of office after the meeting:

`J. R. Bixby                          Walter E. Bixby
                 R. Philip Bixby                      Daryl D. Jensen
                 Warren J. Hunzicker                  Nancy Bixby Hudson
                 Tracy W. Knapp                       William A. Schalekamp
                 E. Larry Winn, Jr.                   Webb R. Gilmore`

Item 5.
Other Information.

`3520 Broadway, Kansas City, MO 64111                     Contact: Tracy W. Knapp, Chief Financial Officer,
                                                                        (816) 753-7299, Extension 8216
For Immediate Release: May 10, 2004`

Kansas City Life Announces First Quarter 2004 Results

Kansas  City Life  Insurance  Company  recorded  net income of $5.6  million or $0.47 per share in the first  quarter of 2004,
reversing  the Company's  net loss of $7.5 million or $0.62 per share for the first  quarter of the prior year.  The largest  factor in
the improved  results was an increase in investment  revenues,  primarily  from a change in net realized  investment  gains and losses.
This change more than offset increased  benefits paid to  policyholders.  In addition,  the Company's first quarter results continue to
reflect the addition of GuideOne Life Insurance Company, which was acquired on June 30, 2003.

Total  investment  revenues were $51.5 million in the first quarter 2004, an increase of $25.8 million from the prior year due
to net realized  losses on  investments  in the first  quarter of 2003.  The Company  recorded net  realized  investment  gains of $0.8
million in the current  period  versus net  realized  investment  losses of $21.8  million for the same period last year.  The realized
losses in the first quarter of 2003 were primarily due to the highly  distressed  airline  industry.  As the economy and credit markets
improved during 2003 and into early 2004, so too has the credit quality and value of the Company's investment securities.

Growth in net investment income also contributed to the Company's  increased  investment  revenue.  In spite of the continuing
low interest rate environment,  which affects the Company's fixed income investment portfolio,  net investment income grew $3.2 million
or 6.7% from the prior year.  The growth was fueled by the addition of GuideOne and increased  investments  resulting  from new product
sales during the past year.

Partially offsetting the Company's improved investment results was the increase in interest credited to policyholder account
balances.  The addition of GuideOne and increased policyholder balances resulting from new product sales during the past year
resulted in a $4.0 million or 19.6% increase in interest credited.  The Company also experienced an increase in other policyholder
benefits paid, due to a rise in mortality in the Kansas City Life Individual Insurance business segment.  Mortality experience will
fluctuate within short periods of time but over longer periods has historically been within long-range assumptions.  This increase in
mortality was largely offset by lower policyholder benefits in other business segments and reduced amortization expense.

(Continued on next page)

Kansas City Life Announces First
Quarter 2004 Results
May 10, 2004; Page Two

The acquisition of GuideOne in 2003 will continue to affect the comparison of financial results for the Company through the
second quarter of 2004.  In addition to the areas noted above, GuideOne is also contributing significantly to insurance revenues and
new product sales.  Primarily attributable to GuideOne, contract charges increased $3.0 million or 11.6% in the first quarter 2004
versus the prior year.  Further, GuideOne contributed 8% and 9% of the Company's new life and annuity sales, respectively, during the
first quarter.

On April 26, 2004, the Board of Directors declared a quarterly dividend of $0.27 per share, payable on May 24, 2004 to
stockholders of record on May 10, 2004.

Kansas  City Life  Insurance  Company  (NASDAQ:  KCLI) was  established  in 1895 and is based in Kansas  City,  Missouri.  The
Company's primary business is providing financial  protection through the sale of life insurance and annuities.  The Company's revenues
were $446 million in 2003,  and assets and life insurance in force were $4.6 billion and $32.6  billion,  respectively,  as of December
31, 2003.  The Company operates in 48 states and the District of Columbia.  For more information, please visit www.kclife.com.

KANSAS CITY LIFE INSURANCE COMPANY
                           CONDENSED CONSOLIDATED INCOME STATEMENT(in thousands, except per share data)

`Quarter ended
                                                                        March 31
                                                               2004                  2003
                                                          ---------------        --------------

Revenues                                                 $       117,746                91,447
                                                          ===============        ==============

Net income (loss)                                        $         5,595               (7,458)
                                                          ===============        ==============

Net income(loss) per share,
   basic and diluted                                     $          0.47                (0.62)
                                                          ===============        ==============


Dividends paid                                           $          0.27                  0.27
                                                          ===============        ==============`

A quarterly dividend of $.27 per share will be paid May 24 to shareholders of record as of May 10.

`Average number of shares outstanding                          11,925,257             11,977,317`

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

`(a)  Exhibits:

                 (31)a      Rule 13a-15(e)/15d-15(e) Certifications.

                 (31)b      Rule 13a-15(e)/15d-15(e) Certifications.

                 (32)       Item 32 - Section 906 Certification.

         (b)  Reports on Form 8-K:

                 1.    On February 13, 2004,  the Company filed a Form 8-K Item 12 the press  release  reporting
                       financial condition as of December 31, 2003.

                 2.    On March 12,  2004,  the  Company  filed a Form 8-K Item 12 the  stockholder  information
                       reflecting the financial condition as of December 31, 2003.`

# SIGNATURES

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

# KANSAS CITY
LIFE INSURANCE COMPANY

`/s/R. Philip Bixby           
R. Philip Bixby
President, Chief Executive Officer
and Vice Chairman of the Board




/s/Tracy W. Knapp            
Tracy W. Knapp
Senior Vice President, Finance`

Date:  May 7, 2004