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 September 30, 1997





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 at October 6, 1997

Common Stock, $2.50 par value                   6,190,996 shares









Kansas City Life Insurance Company

Quarter ended September 30, 1997





Part I



Item 1. Financial  Statements

Incorporated  by reference from the Quarterly  Report to  Stockholders  (pages 4
through 7) see the attached exhibit.  These interim financial  statements should
be read in conjunction with the Company's 1996 Annual Report to Stockholders.



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



Results of Operations



Operating  earnings  per share for the third  quarter  decreased 12 percent from
last year.  For the nine months,  operating  earnings per share  equaled $4.28 a
share, a 13 percent decrease.  Net income per share rose 27 percent in the third
quarter,  and increased  $0.30, or 6 percent,  from $5.10 to $5.40 per share for
the nine months. Bolstering the net income numbers is a $5.3 million increase in
realized gains for the third quarter, and $9.1 million for the nine months.



During the third quarter,  the Company acquired a block of 100,000 universal and
traditional  life  policies  for $62.4  million in cash.  Related  tax  benefits
reduced  the  transaction's  net  cost to $51  million.  The  internally  funded
acquisition was structured as a coinsurance  transaction.  The purchase adds $27
million in additional  insurance  revenues per year,  $330 million in assets and
liabilities,  and $3.8  billion in  insurance in force.  The  acquisition  had a
minor, accretive impact to the quarter's earnings.



Sales



Consolidated new annualized  premiums increased 35 percent in the third quarter,
building on the momentum of a 7 percent increase in the second quarter.  For the
nine months, new premiums rose 13 percent as sales of variable  products,  which
are comprised of variable  universal life and annuities,  have  experienced  160
percent  growth.  New premiums  from all other lines of business  increased by 4
percent for the quarter, but declined 5 percent year-to-date. These results were
not impacted by the acquisition mentioned above. Life insurance in force totaled
$26.4  billion at period end, a 26 percent  annualized  increase  from last year
end. Excluding the acquired block, there was a 2 percent annualized  increase in
insurance in force.

<PAGE>


Insurance Revenues



Excluding the acquired  block,  insurance  revenues rose 6 percent for the third
quarter and 5 percent for the nine  months.  Including  the  acquisition,  total
insurance  revenues  increased  9 percent  year-to-date.  Life  premiums  rose 8
percent for the quarter due to the acquisition and growth in both individual and
group life premiums.  Year-to-date, life premiums are up 1 percent. Accident and
health  premiums  increased 14 percent for the third  quarter and 19 percent for
the first three quarters of the year  principally  due to the group dental line.
Contract charge revenues on interest  sensitive products increased 7 percent for
the  quarter  and 6 percent  for the nine  months,  excluding  the impact of the
acquired block.



Investment Revenues



Investment income,  excluding the effects of the above  acquisition,  declined 1
percent, in line with investment assets on a book basis. As previously mentioned
investment gains rose $5.3 million in the third quarter and $9.1 million for the
nine months due  principally to calls in the  securities  portfolio and sales of
investment real estate.



Benefits



Total benefits,  excluding the acquisition,  increased 2 percent. Death benefits
rose 12 percent,  life  insurance  surrenders  decreased  10 percent,  and other
benefits  increased 3 percent.  Mortality  experience has been considerably less
favorable   than   last   year.   However,   mortality   experience   fluctuates
period-to-period by its nature. The increase in other benefits stems mostly from
the group health lines of business. Total policy benefits and increase in future
policy  benefits  equaled 59.2 percent of revenues  thus far in 1997 compared to
60.5 percent through three quarters of 1996.



Other Expenses



Home office operating expenses,  excluding the acquired block, rose 9 percent in
the quarter and 7 percent in the nine months. The increase is largely focused in
the group and  individual  marketing  areas in support  of  efforts to  increase
revenues.

<PAGE>


Liquidity and Capital Resources



Statements  made in the  Company's  1996 Annual  Report to  Stockholders  remain
pertinent.



Cash  provided  from  operating  activities  decreased  51 percent  for the nine
months,  principally reflecting a shift in product mix toward variable and group
products,  and  increased  benefit  payments.  Funds from all sources  topped $1
billion,  up considerably  due to the insurance block  acquisition and increased
investment sales.



Assets totaled $3.4 billion  reflecting both normal growth and growth due to the
acquisition.  Unrealized  gains  and  losses  on  available-for-sale  securities
increased markedly due to declining interest rates in the market place. Reported
book value per share equaled $82.38, a 14 percent  annualized  improvement since
last year end. Excluding unrealized gains, book value per share rose 7 percent.



Financial  Accounting  Standards  Board  (FASB)  Statement  No. 130,  "Reporting
Comprehensive  Income"  will be adopted  in the first  quarter of 1998 and will
require  disclosure  of  comprehensive  income  which  includes  the  change  in
unrealized  investment  gains and losses.  The  comprehensive  income  amount is
expected  to  be  more  volatile  than  net  income.  FASB  statement  No.  131,
"Disclosures  about  Segments  of an  Enterprise  and  Related  Information"  is
currently under study by management and will be implemented by year end 1998.

<PAGE>




Part II:  Other Information



Item 6.



(a)  Exhibits:  None



(b) On September 5, 1997, the Company filed a report on Form 8-K announcing that
it had reached  agreement to purchase a block of insurance from Security Benefit
Life Insurance Company. A copy of the press release containing information about
the transaction was included with the filing.



On September 24, 1997, the Company filed a report on Form 8-K indicating that it
had acquired through a coinsurance  agreement a block of  approximately  100,000
traditional and interest sensitive life insurance policies from Security Benefit
Life Insurance Company, and received approximately $300 million in cash equal to
the policy reserves,  less a ceding commission of $62.4 million representing the
consideration  paid by the  Company  for the  acquired  policies.  A copy of the
Coinsurance and Servicing  Agreement dated September 4, 1997 between Kansas City
Life Insurance  Company and Security Benefit Life Insurance Company was included
with the filing.





<PAGE>




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/Richard L. Finn

Richard L. Finn

Senior Vice President, Finance





/s/John K. Koetting

John K. Koetting

Vice President and Controller





/s/C. John Malacarne

C. John Malacarne

Vice President, General Counsel and Secretary







Date:  November 13, 1997































KANSAS CITY LIFE INSURANCE COMPANY

Quarter ended June 30, 1997

EXHIBIT






Quarterly Report to Stockholders
Consolidated
Balance Sheet
(in thousands)

                                    September 30     December 31
                                        1997           1996
                                   -------------  -------------
Assets
Investments:
  Fixed maturities:
    Securities available for sale,
      at market                      $ 2,031,438      1,759,153
    Securities held to maturity,
      at amortized cost                  166,809        248,433
  Equity securities available
    for sale, at market                   91,941         79,018
  Mortgage loans                         252,989        246,493
  Real estate                             39,717         43,750
  Real estate joint ventures              41,396         28,356
  Policy loans                           123,896         94,412
  Short-term                              56,592         19,642
  Other                                    7,500              0
                                   -------------  -------------
                                       2,812,278      2,519,257

Deferred acquisition costs               207,620        207,020
Other assets                             318,232        214,517
Separate account assets                   42,399         13,916
                                   -------------  -------------

                                     $ 3,380,529      2,954,710
                                   =============  =============

Liabilities and equity
Future policy benefits               $   797,347        701,560
Accumulated contract values            1,760,277      1,544,714
Other liabilities                        270,231        231,656
Separate account liabilities              42,399         13,916
                                   -------------  -------------
  Total liabilities                    2,870,254      2,491,846

Stockholders' equity:
  Capital stock                           23,121         23,121
  Paid in capital                         15,961         14,761
  Unrealized gains on
    securities available for sale         24,817          2,963
  Retained earnings                      534,978        509,748
  Less treasury stock                    (88,602)       (87,729)
                                   -------------  -------------
                                         510,275        462,864
                                   -------------  -------------

                                     $ 3,380,529      2,954,710
                                   =============  =============

Notes:
*  These  financial  statements  are  unaudited  but, in  management's  opinion,
   include all adjustments necessary for a fair presentation of the results.

*  Income per common share is based upon the weighted  average  number of shares
   outstanding  during the nine months,  6,189,738  shares  (6,187,677  shares -
   1996).

*  These interim  financial  statements  should be read in conjunction  with the
   Company's 1996 Annual Report to  Stockholders.  The results of operations for
   any interim period are not necessarily  indicative of the Company's operating
   results for a full year.

*  Certain amounts from the prior financial statements have been reclassified to
   conform with the current presentation.






<PAGE>



Consolidated
Income Statement
(in thousands, except per share data)
                                              Quarter ended  Nine Months ended
                                               September 30      September 30
                                              1997     1996     1997     1996
                                            -------  -------  -------  -------
Revenues
Insurance revenues:
  Premiums:
    Life insurance                         $ 27,602   25,629   78,239   77,485
    Accident and health                      11,111    9,717   32,865   27,574
  Contract charges                           26,097   19,528   66,983   58,544
Investment revenues:
  Investment income, net                     50,587   46,885  143,864  140,246
  Realized gains                              6,337    1,032   10,632    1,502
Other                                         3,198    2,133    9,564    7,271
                                            -------  -------  -------  -------
    Total revenues                          124,932  104,924  342,147  312,622
                                            -------  -------  -------  -------
Benefits and expenses
Policy benefits:
  Death benefits                             24,735   21,329   75,552   63,909
  Surrenders of life insurance                4,287    3,684   11,350   11,439
  Other benefits                             18,243   17,320   50,809   48,082
  Increase in benefit and contract reserve   25,435   23,189   64,684   65,786
Amortization of policy acquisition costs     10,074    7,340   26,706   22,305
Insurance operating expenses                 24,550   19,036   65,988   56,353
Interest expense                                515        0      515        1
                                            -------  -------  -------  -------
    Total benefits and expenses             107,839   91,898  295,604  267,875
                                            -------  -------  -------  -------

Pretax income                                17,093   13,026   46,543   44,747
                                            -------  -------  -------  -------
Federal income taxes:
  Current                                    (4,068)   5,189    7,599   18,731
  Deferred                                    9,403   (1,477)   5,547   (5,540)
                                            -------  -------  -------  -------
                                              5,335    3,712   13,146   13,191
                                            -------  -------  -------  -------

Net income                                $  11,758    9,314   33,397   31,556
                                            =======  =======  =======  =======

Per common share
  Operating income                           $ 1.23     1.39     4.28     4.94
  Realized gains, net                          0.67     0.11     1.12     0.16
                                            -------  -------  -------  -------

  Net income                                 $ 1.90     1.50     5.40     5.10
                                            =======  =======  =======  =======




<PAGE>

     CONSOLIDATED
STATEMENT OF CASH FLOWS
    (in thousands)
                                                               Nine Months ended
                                                                   September  30
                                                              1997         1996
 Operating activities
   Net cash provided                                       $16,905       34,546

 Investing activities Investments called or matured:
   Fixed maturities available for sale                     124,905      125,447
   Fixed maturities held to maturity                        84,700       54,915
   Equity securities available for sale                     21,181        8,378
   Mortgage loans                                           35,264       34,860
   Other                                                     2,117        7,083
 Investments sold:
   Fixed maturities available for sale                     334,807       77,739
   Real estate joint ventures                                9,441        6,961
   Other                                                     5,061        3,047
 Investments made:
   Fixed maturities available for sale                    (695,455)    (331,294)
   Equity securities available for sale                    (37,504)     (13,623)
   Mortgage loans                                          (42,049)     (34,305)
   Real estate joint ventures                              (15,698)      (2,067)
   Decrease (increase) in short-term investments, net      (36,969)      10,397
   Other                                                    (7,500)      (1,972)
 Acquisition of life block:
   Cash received net of purchase price paid                212,904            0
 Other, net                                                 (2,729)         348
   Net cash used                                            (7,524)     (54,086)

 Financing activities
 Policyowner contract deposits                             154,721      130,812
 Withdrawals of policyowner
   contract deposits                                      (129,726)    (106,628)
 Dividends paid to stockholders                             (8,167)      (7,794)
 Other, net                                                   (274)         406
   Net cash provided                                        16,554       16,796

 Increase (decrease) in cash                                25,935       (2,744)
 Cash at beginning of year                                   4,577        9,612
   Cash at end of period                                   $30,512        6,868










<PAGE>


Message from the President

Kansas City Life's  operating  earnings  continued  to trail last year's  record
level.  Operating  earnings  declined 12 percent in the third quarter and are 13
percent  lower for the nine months.  However,  due to  substantial  increases in
realized investment gains, net income rose 26 percent in the third quarter and 6
percent for the nine months.

Operating  earnings have been pressured by less favorable  mortality  results at
our insurance  affiliates.  Though mortality  experience in the parent company's
individual lines improved considerably in the third quarter, adverse claims were
experienced in the group dental line.

Investment income,  excluding the effects of the acquired block discussed below,
declined 1 percent for the nine months,  in line with the decline in  investment
assets on a book basis.  Realized  investment gains rose $9 million for the nine
months  principally  due to sales of  investment  real  estate  and calls on the
securities portfolio.

During  the  third  quarter,  the  Company  acquired  a block of  universal  and
traditional life insurance for $51 million in cash, net of related tax benefits.
The purchase was structured as a coinsurance  transaction.  The  acquisition was
funded  internally and is expected to be accretive and to benefit  earnings from
the outset.  We expect to accomplish two goals with this  purchase,  improve the
return earned on our excess capital and leverage our administrative capabilities
in order  to lower  unit  costs.  The  acquisition  adds $27  million  a year in
insurance revenues, $330 million in assets and liabilities,  and $3.8 billion of
insurance in force.

Sales of variable  universal life and annuities  fueled strong sales results for
the Company.  Third quarter sales, in terms of net annualized premiums,  rose by
35  percent.  For the nine  months,  new  premiums  rose 13 percent due in large
measure to the 160 percent  growth in variable  premiums.  New premiums from all
other  lines of  business  rose by 4 percent  for the  quarter,  but  declined 5
percent  year-to-date.  These  results  were  not  impacted  by the  acquisition
discussed  above.  Total  insurance  revenues rose  considerably in the attached
earnings  statement  since  revenues from the acquired block are included in the
data for 1997 but not for 1996.  Excluding  these revenues,  insurance  revenues
rose 5 percent in the nine months and 6 percent in the third quarter.

Insurance in force equals $26.4 billion, a 26 percent  annualized  increase from
last year end.  Excluding the acquired block,  insurance in force rose 2 percent
on an annualized basis.

Book  value  per  share  rose to  $82.38 a share  from  $74.79 at last year end.
Excluding unrealized gains on the available-for-sale  securities, book value per
share rose 7 percent on an annualized basis.

For the fourth  consecutive year, the Ward Financial Group has named Kansas City
Life as one of the 50 safest and best-performing life insurance companies in the
United  States.  This award is based upon  operating and financial  data for the
previous five years.

The Board of Directors  approved a $.44 a share  quarterly  dividend  payable on
November 24 to  stockholders of record on November 10. The dividend is unchanged
from last quarter.

                                     /s/ W. E. Bixby