SECURITIES AND EXCHANGE COMMISSION
                        Washington, D. C.  20549
                                    
                                    
                                FORM 10-Q
                                    
                                    
         Quarterly Report Pursuant to Section 13 or 15(d) of the
                     Securities Exchange Act of 1934


For the Quarterly Period Ended                           Commission File
September 30, 1995                                            No. 1-1569



                    AMERICAN PREMIER UNDERWRITERS, INC.


Incorporated under                                       IRS Employer I.D.
the Laws of Pennsylvania                                 No. 23-6000765 


              One East Fourth Street, Cincinnati, Ohio  45202
                              (513) 579-6600





Indicate by check mark whether the Registrant (1) has filed all reports 
required to be filed by Section 13 or 15(d) of the Securities Exchange Act 
of 1934 during the preceding 12 months, and (2) has been subject to such 
filing requirements for the past 90 days.  Yes   X    No     




As of November 1, 1995, there were 47,000,000 shares of the Registrant's 
Common Stock outstanding, all of which were owned by American Financial 
Group, Inc., an Ohio corporation.




                               Page 1 of 20

 <PAGE>
                   AMERICAN PREMIER UNDERWRITERS, INC.
                                    
                                    
                                  INDEX


                                                               Page No. 

PART I.  FINANCIAL INFORMATION   


Item 1.    Financial Statements     

      Statement of Income -                                         1
          For the three months and nine months
          ended September 30, 1995 and 1994                                    

      Balance Sheet -                                               2
        September 30, 1995 and December 31, 1994                        

      Statement of Cash Flows -                                     3
        For the nine months ended September 30,
          1995 and 1994


      Notes to Financial Statements                                 4



Item 2. Management's Discussion and Analysis                       14
        of Financial Condition and Results
        of Operations                                                   




PART II.   OTHER INFORMATION 


Item 1.    Legal Proceedings                                       19
 

Item 6.    Exhibits and Reports on Form 8-K                        19
<PAGE>

PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements

AMERICAN PREMIER UNDERWRITERS, INC. AND CONSOLIDATED SUBSIDIARIES
STATEMENT OF INCOME
(In Millions)
 
<TABLE>
<CAPTION>
                                    Three Months Ended   Nine Months Ended
                                       September 30,        September 30,
                                      1995       1994      1995       1994 
<S>                                  <C>       <C>       <C>       <C>
Revenues
  Insurance operations     
  Premiums earned                     $ 372.1  $ 412.2    $1,131.5 $1,160.9
       Net investment income             35.8     32.4       110.3     94.6
       Net realized gains (losses)        6.9     (1.0)       10.7       .8
  Equity in net earnings 
    of investee corporations              (.9)      -           .7       - 
  Other operations
  Net sales                               3.5     22.4        10.7     97.5
  Interest and dividend income           16.0     10.6        43.2     26.2
  Provision for loss on
    sale of General Cable
    Corporation securities                 -        -           -     (75.8)
  Net realized gains (losses)              .2       -         (2.2)      .1
                                        433.6    476.6     1,304.9  1,304.3
Expenses
  Insurance operations
  Losses                                259.8    250.7       771.5    685.2
  Loss adjustment expenses               43.6     40.2       127.6    113.8
  Commissions and other
    insurance expenses                   87.0     91.1       261.7    260.9
  Policyholder dividends                 (3.5)    15.7         1.6     67.6
  Other operations
  Cost of sales                           1.1     18.1         3.8     53.9
  Interest and debt expense               9.8     13.1        36.1     39.9
  Other operating and
     general expenses                     6.4     12.9        24.9     66.6
                                        404.2    441.8     1,227.2  1,287.9

Earnings before income taxes             29.4     34.8        77.7     16.4 
Income tax expense                      (11.2)    (9.6)      (29.6)   (30.5)

Net earnings (loss) from
  continuing operations                  18.2     25.2        48.1    (14.1)

Gain(loss) on disposal of
  discontinued operations                  -        .9          -       (.5)
Extraordinary loss                        (.6)      -         (4.7)      - 

Net earnings (loss)                   $  17.6  $  26.1    $   43.4  $ (14.6)
</TABLE>


                SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
       
                                        - 1 - <PAGE>
<PAGE>
        AMERICAN PREMIER UNDERWRITERS, INC. AND CONSOLIDATED SUBSIDIARIES
                                 BALANCE SHEET
                                 (In Millions)
<TABLE>
<CAPTION>
                                               September 30,  December 31,
                                                    1995          1994   
<S>                                               <C>          <C>
Assets
Investments held by insurance operations
  Fixed maturity securities
    Held for investment - stated at amortized cost
       (market $1,157.0 and $1,244.5)             $1,133.5     $1,317.9
    Available for sale - stated at market 
       (cost $751.1 and $524.1)                      770.3        501.0
  Short-term investments                              29.0         51.7
  Equity in affiliates                                 4.6           - 
  Investment in investee corporation                  44.1           - 
                                                   1,981.5      1,870.6
Parent Company investments
  Fixed maturity securities
    Held for investment - stated at amortized cost
       (market $  - and $271.5)                         -         279.3
    Available for sale - stated at market
       (cost $43.4 and $328.0)                        42.9        323.4
  Short-term investments                               5.8        199.1
  Equity in affiliates                                 8.4         11.7
  Amounts due from affiliates                        521.8           - 
                                                     578.9        813.5

Cash                                                  46.0         36.7
Accrued investment income                             35.0         46.6
Agents' balances and premiums receivable             354.3        343.8
Reinsurance receivable                                50.5         52.7
Other receivables                                     35.3         42.2
Deferred policy acquisition costs                     94.8         92.1
Cost in excess of net assets acquired                393.6        394.5
Deferred tax asset                                   235.2        267.7
Other assets                                         194.2        233.6
    Total                                         $3,999.3     $4,194.0


Liabilities And Common Shareholders' Equity

Unpaid losses and loss adjustment expenses        $1,177.6     $1,130.9
Policyholder dividends                                65.6        102.4
Unearned premiums                                    466.5        440.2
Debt                                                 368.1        507.3
Minority interests in subsidiaries                      -           6.2
Accounts payable and other liabilities               402.8        458.3
  Total liabilities                                2,480.6      2,645.3

Common Stock                                          47.0         46.3
Capital surplus                                      578.4        662.2
Retained earnings (from October 25, 1978)            881.3        867.5
Net unrealized gains (losses) on investments          12.0        (27.3)
  Total common shareholders' equity                1,518.7      1,548.7
    Total                                         $3,999.3     $4,194.0
</TABLE>
                 SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
                                     - 2 -<PAGE>
      
<PAGE>                                     
         AMERICAN PREMIER UNDERWRITERS, INC. AND CONSOLIDATED SUBSIDIARIES
                           STATEMENT OF CASH FLOWS
                                (In Millions)
<TABLE>
<CAPTION>                                                 Nine Months ended 
                                                             September 30,
                                                            1995     1994 
<S>                                                       <C>       <C>
Cash flows of operating activities:
  Net earnings (loss) from continuing operations          $   48.1  $ (14.1)
  Adjustments to reconcile earnings from continuing
    operations to net cash provided by continuing activities                   
       Deferred Federal income tax                            25.7     26.8
  Equity in net earnings of investee corporations              (.7)      -
       Depreciation, depletion and amortization               19.9     21.3
       Net (gain) loss on disposals of businesses,
   investments and property, plant and equipment              (7.8)    71.5
       Changes in assets and liabilities, excluding effects of 
   acquisitions and divestitures of businesses 
     Increase in receivables                                 (15.1)   (69.3)
     Increase in other assets                                 (4.0)    (3.3)
     Decrease in accounts payable and other liabilities      (15.5)    (2.1)
     Increase in unpaid losses and loss 
       adjustment expenses                                    47.2    122.8
     Increase (decrease) in policyholder dividends           (36.8)     8.3
     Increase in unearned premiums                            27.7     74.4
  Dividends from investees                                      .3       -
  Other, net                                                   4.1      1.7 
       Net cash flows of operating activities                 93.1    238.0

Cash flows of investing activities:
  Purchases of available for sale investments               (287.7)  (375.0)
  Maturities and sales of available for sale investments     844.3     68.7
  Purchases of held for investment securities               (129.5)  (305.5)
  Maturities of held for investment securities                47.0    107.0
  Purchases of short-term investments                        (21.8)  (180.0)
  Sales and maturities of short-term investments             145.8    158.3 
  Net decrease in short-term investments                      95.4    143.9 
  Sales of businesses                                         20.7     32.9
  Sale of General Cable Corporation securities                  -     176.7 
  Acquisitions of businesses, net of cash acquired           (13.4)      - 
  Capital expenditures                                       (10.8)   (18.3)
  Other, net                                                    .2     (1.4)
       Net cash flows of investing activities                690.2   (192.7)
Cash flows of financing activities:
  Repayment of debt                                         (144.1)   (17.1)
  Common Stock dividends                                     (21.7)   (30.4)
  Exercise of stock options and conversion of career shares     .5     15.0
  Purchases of Company Common Stock                          (87.6)   (16.3)
  Net advances to affiliates                                (521.2)      - 
  Other, net                                                    .1      4.0
       Net cash flows of financing activities               (774.0)   (44.8)

Increase in cash                                               9.3       .5 
Cash - beginning of year                                      36.7     32.4

Cash - end of period                                      $   46.0  $  32.9
</TABLE>


              SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
                                  - 3 -<PAGE>
    
<PAGE>                                  
        AMERICAN PREMIER UNDERWRITERS, INC. AND CONSOLIDATED SUBSIDIARIES
                      NOTES TO FINANCIAL STATEMENTS

 1.   ACCOUNTING POLICIES AND BASIS OF PRESENTATION
     In the opinion of management, the accompanying unaudited financial
statements of American Premier Underwriters, Inc. and Consolidated
Subsidiaries (the "Company") include all adjustments, which are of a normal
recurring nature, necessary to present fairly the Company's results of
operations, financial position and cash flows.  As permitted by the rules
and regulations of the Securities and Exchange Commission ("SEC"), the
financial statements do not include all of the accounting information
normally included with financial statements prepared in accordance with
generally accepted accounting principles.  Accordingly, these financial
statements should be read in conjunction with the financial statements and
notes thereto included in the Company's Annual Report on Form 10-K for the
year ended December 31, 1994.  Results for the three months and nine months
ended September 30, 1995 are not necessarily indicative of the results for
any other interim period or for the year as a whole.  Certain
reclassifications have been made to prior years to conform to the current
year's presentation.


 2.  ACQUISITION OF AMERICAN FINANCIAL CORPORATION
     On April 3, 1995, the Company became a wholly owned subsidiary of
American Premier Group, Inc., a new corporation formed by the Company for
the purpose of acquiring all of the common stock of American Financial
Corporation (the "Acquisition").  On June 9, 1995, American Premier Group
changed its name to American Financial Group, Inc. ("AFG").  Under the
terms of the Acquisition, (a) the Company merged with a subsidiary of AFG
(the "Merger") and each share of Company Common Stock then outstanding was
converted into one share of AFG Common Stock, and (b) American Financial
Corporation ("AFC") merged with another subsidiary of AFG and all shares
of AFC common stock were exchanged for 28.3 million shares of AFG Common
Stock.  As a result of the Acquisition, all of the common stock of the
Company and AFC is owned by AFG and AFG is the Company's successor as the
issuer of publicly held common stock.













                                  - 4 -
<PAGE>
 3.   INSURANCE OPERATIONS

Investments of Insurance Operations
     The insurance operations' investments in fixed maturity securities
at September 30, 1995 consisted of the following:
<TABLE>
<CAPTION>                                  Gross        Gross  
                              Amortized  Unrealized   Unrealized    Market
        (In Millions)           Cost       Gains        Losses      Value 
<S>                           <C>       <C>            <C>       <C>  
Held for investment
  Corporate securities        $  831.0  $   25.9       $    8.4   $  848.5
  Public utilities               194.6       5.5            1.2      198.9
  Mortgage-backed securities      91.5       1.2             .2       92.5
  State and local obligations      7.8        .8             -         8.6
  Foreign securities               8.6        .1             .2        8.5
   Total held for investment   1,133.5      33.5           10.0    1,157.0

Available for sale
  Corporate securities           507.9      20.8            5.5      523.2
  Public utilities                54.7        .9             .6       55.0
  Mortgage-backed securities      65.3       2.1             .3       67.1
  U.S. government securities      74.7       2.3             .4       76.6
  State and local obligations      2.3        .1             -         2.4
  Foreign securities              51.7        .3             .5       51.5
    Total available for sale     756.6      26.5            7.3      775.8
     
    Total fixed maturity
      securities              $1,890.1  $   60.0       $   17.3   $1,932.8
</TABLE>

     In connection with the Acquisition, fixed maturity securities of the
insurance operations classified as held for investment at April 3, 1995
with a carrying value of $274.1 million (market value of $269.0 million)
were reclassified as available for sale.
     At September 30, 1995, the insurance operations' investments included
unrated or less than investment grade corporate securities with a carrying
value of $107.6 million (market value $105.4 million).  Investments of
insurance operations include a net payable of $5.5 million for securities
purchased but not settled at September 30, 1995.  At September 30, 1995,
short-term investments consisted principally of U.S. Treasury securities
and commercial paper.
     The insurance operations investment in investee corporation reflects
the Company's 6 percent ownership (3.2 million shares) of the common stock
of Chiquita Brands International ("Chiquita") which is accounted for under
the equity method.  AFG and its other subsidiaries own an additional 39
percent interest in the common stock of Chiquita.  Chiquita is a leading
international marketer, processor and producer of quality food products. 
The market value of the Company's investment in Chiquita was approximately
$55.4 million at September 30, 1995.



                                 - 5 -
<PAGE>
Investment Income of Insurance Operations
     Investment income consists of the following:
<TABLE>
<CAPTION>                                 (In Millions)
                              Three Months Ended   Nine Months Ended
                                September 30,        September 30,  
                               1995       1994      1995       1994 
<S>                           <C>      <C>         <C>        <C>
Income from fixed maturity
  securities                  $ 36.8     $ 33.2    $112.9     $ 97.1
Investment expenses             (1.0)       (.8)     (2.6)      (2.5)
Net investment income         $ 35.8     $ 32.4    $110.3     $ 94.6
</TABLE>

     Income from fixed maturity securities includes income from short-term
investments.

     Realized gains (losses) consist of the following:
<TABLE>
<CAPTION>                                (In Millions)
                              Three Months Ended   Nine Months Ended
                                September 30,        September 30,  
                               1995        1994     1995       1994 
<S>                           <C>      <C>         <C>      <C>
Gross realized gains on:
 Fixed maturity securities    $  7.3    $   -     $ 12.9    $  2.7

Gross realized losses on:
 Fixed maturity securities      ( .4)     (1.0)     (2.2)     (1.9)
Net realized gains (losses)   $  6.9    $ (1.0)   $ 10.7    $   .8
</TABLE>
                                 

     For the three months and nine months ended September 30, 1995, proceeds 
from sales of fixed maturity securities, excluding proceeds from sales at or 
near maturity, totalled $134.8 million and $298.1 million, respectively, of 
which $122.1 million and $285.4 million, respectively, were from securities 
classified as available for sale and $12.7 million in each period were from 
securities classified as held for investment.  For the three months and nine 
months ended September 30, 1994, proceeds from sales of fixed maturity 
securities totalled $15.5 million and $55.2 million, respectively.  All of 
such proceeds for the 1994 third quarter were from securities classified as 
available for sale.  For the nine months ended September 30, 1994, 
$43.6 million of proceeds from these sales were from securities classified 
as available for sale and $11.6 million were from securities classified as 
held for investment.  All sales of held for investment securities were made 
as a result of deterioration in the issuers' credit ratings.






                                      - 6 -
 <PAGE>
     The gross realized gains (losses) attributable to sales of fixed maturity
securities, excluding sales at or near maturity, were:
<TABLE>
<CAPTION>                                  (In Millions)
                              Three Months Ended      Nine Months Ended
                                September 30,          September 30,   
                               1995     1994          1995      1994 
<S>                            <C>      <C>           <C>       <C>
Available for sale:
 Gross realized gains          $  6.6    $   .1       $ 12.1    $   .9
 Gross realized losses            (.3)      (.8)        (2.1)     (1.5)

Held for investment:
 Gross realized gains          $   .7    $   -        $   .7    $  1.3
 Gross realized losses             -         -            -        (.1)
</TABLE>
Reinsurance
     The insurance operations assume and cede a portion of their written
business with other insurance companies in the normal course of business.  To
the extent that any reinsuring companies are unable to meet their obligations
under agreements covering reinsurance ceded, the Company's insurance
subsidiaries would remain liable.  Amounts deducted from insurance losses and
loss adjustment expenses and net written and earned premiums in connection
with reinsurance ceded to affiliated and non-affiliated companies, as well as
amounts included in net written and earned premiums for reinsurance assumed
from affiliated and non-affiliated companies, were as follows:
<TABLE>
<CAPTION>                                    (In Millions)
                               Three Months Ended   Nine Months Ended
                                 September 30,        September 30,
                                1995     1994        1995      1994 
<S>                           <C>       <C>        <C>       <C>
Reinsurance ceded:
   Premiums written
     Affiliates               $    -    $    -     $    -    $    - 
     Non-affiliates               1.9       6.3       11.4      16.2

   Premiums earned
     Affiliates                    -         -          -          -
     Non-affiliates               2.4       4.8       11.4       14.3

   Incurred losses and
    loss adjustment expenses
     Affiliates                    .1      (.4)         .8       (1.9)
     Non-affiliates               2.4      4.4         8.4       13.4

Reinsurance assumed:
   Premiums written
     Affiliates                  31.2     45.5       106.7      132.8
     Non-affiliates               5.8     10.8        15.9       28.4

   Premiums earned
     Affiliates                  32.9     34.9        79.2      93.7
     Non-affiliates               6.7     13.2        22.3      42.1
</TABLE>
                                   - 7 -
 <PAGE>
 4.   PARENT COMPANY INVESTMENTS
     The Parent Company investments in fixed maturity securities at September
30, 1995 consisted of the following:
<TABLE>
<CAPTION>
                                           Gross       Gross    
                              Amortized  Unrealized  Unrealized     Market
        (In Millions)             Cost     Gains       Losses       Value  
<S>                           <C>        <C>         <C>          <C>
Available for sale
  Corporate securities        $   29.8   $     .2    $     .7     $   29.3
  Public utilities                  .3         -           -            .3
  U.S. government securities      13.3         -           -          13.3
    Total fixed maturity
     securities               $   43.4   $     .2    $     .7     $   42.9
</TABLE>

     In connection with the Acquisition, all Parent Company fixed maturity
securities classified as held for investment at April 3, 1995 with a carrying
value of $273.0 million (market value of $268.3 million) were reclassified as
available for sale.
     At September 30, 1995, short-term investments consisted principally of
U.S. Treasury securities and commercial paper.
     At September 30, 1995, the carrying value of unrated or less than
investment grade corporate securities, totalled $22.8 million.
     For the three months and nine months ended September 30, 1995, proceeds
from sales of Parent Company investments in fixed maturity securities,
excluding proceeds from sales at or near maturity, totalled $51.4 million and
$534.1 million, respectively, all of which were from securities classified as
available for sale.  The net realized gains attributable to such sales during
the 1995 third quarter were $.2 million.  For the nine months ended September
30, 1995, such sales resulted in net realized losses of $2.2 million.
     Subsequent to the Acquisition, the Company entered into a credit
agreement with AFC under which the Company will make loans available to AFC
of up to $675 million (the "AFC Credit Agreement"). The credit line bears
interest at 11-5/8 percent and converts to a four-year term loan in March 2005
with scheduled principal payments to begin in April 2005.  At September 30,
1995, amounts outstanding under the AFC Credit Agreement totalled $559.6
million.
     Also subsequent to the Acquisition, the Company entered into a credit
agreement with AFG under which the Company and AFG will make loans of up to
$125 million available to each other (the "AFG Credit Agreement").  The
balance outstanding under the credit line bears interest at a variable rate
of one percent over the London Interbank Offered Rate (LIBOR) and is payable
on December 31, 2010.  At September 30, 1995, amounts payable to AFG under the
AFG Credit Agreement totalled $53.0 million.



                                   - 8 -
  <PAGE>

 5.  DEBT

     Long-term debt of the Company consisted of the following:
<TABLE>
<CAPTION>                              September 30,   December 31,
                                            1995           1994    
     <S>                                   <C>            <C>
     10-7/8% Subordinated notes due 2011   $ 79.0         $148.9

     10-5/8% Subordinated notes due 2000    120.3          149.2

     9-3/4% Subordinated notes due 1999     159.6          199.4

     Other                                    9.2            9.8

                                           $368.1         $507.3
</TABLE>

     In May 1995, rating agencies downgraded the Company's subordinated notes
(the "Notes").  As a result of the Acquisition and the subsequent ratings
downgrade, the holders of the Notes had the right (which has since expired)
to require the Company to purchase all or any portion of the Notes on August
10, 1995 at par plus accrued interest (the "Put Right").  The Put Right was
exercised for Notes totalling approximately $44 million.
     In addition, during the 1995 second and third quarters, the Company
repurchased $27.0 million of its 10-5/8 percent subordinated notes and $69.3
million of its 10-7/8 percent subordinated notes for an average of
approximately 104 percent of principal amount which resulted in an
extraordinary loss of $4.7 million.
     During the fourth quarter (through November 10), the Company repurchased
an additional $26.0 million of its 10-7/8 percent subordinated notes.













                                    - 9 -
<PAGE> 
 6.   CHANGES IN COMMON SHAREHOLDERS' EQUITY
<TABLE>
<CAPTION>
                                                                    Unrealized
                                                                      Gains
                                   Common Stock   Capital  Retained  (Losses) On
(Dollars in Millions)            Shares   Amount  Surplus  Earnings  Investments
<S>                          <C>          <C>       <C>      <C>      <C>
Balance, December 31, 1994   46,282,157   $ 46.3    $662.2   $867.5   $(27.3)

Net earnings                       -          -         -      43.4       -

Dividends declared on 
  Common Stock                     -          -         -     (10.8)      -

Purchases of Company 
  Common Stock               (3,259,697)    (3.3)    (79.5)      -        -

Exercise of stock options        16,582       -         .3       -        -

Issuance of Common Stock 
  under ESPP                      4,239       -         .1       -        -

Change in net unrealized
  gains (losses) on
  investments                      -          -         -        -      39.3

Conversion of shares to
  shares of American
  Financial Group, Inc.     (43,043,281)   (43.0)     43.0       -        -

Post-Merger shares
  outstanding                47,000,000     47.0     (47.0)      -        -

Dividends to American
  Financial Group, Inc.            -          -         -     (18.8)      -

Other, net                         -          -        (.7)      -        - 

Balance, September 30, 1995  47,000,000   $ 47.0    $578.4   $881.3   $ 12.0
</TABLE>

 7.   INCOME TAXES
    The Company's substantial tax loss carryforwards and temporary
differences give rise to deferred tax assets.  Based on an analysis of the
likelihood of realizing the Company's gross deferred tax asset (taking into
consideration applicable statutory carryforward periods), the Company has
determined that the recognition criteria set forth in Statement of
Financial Accounting Standards ("SFAS") No. 109, "Accounting For Income
Taxes", are not met for the entire gross deferred tax asset and,
accordingly, the gross deferred tax asset is reduced by a valuation
allowance.  The analysis of the likelihood of realizing the gross deferred
tax asset is reviewed and updated periodically.  Any required adjustments
to the valuation allowance are made in the period in which the developments
on which they are based become known.




                                 - 10 -
<PAGE>

    Components of the provision for income tax expense were as follows:
<TABLE>
<CAPTION>                                  (In Millions)
                              Three Months Ended      Nine Months Ended
                                 September 30,           September 30,   
                               1995         1994        1995      1994
  <S>                           <C>       <C>         <C>       <C>
  Current
      Federal                   $  (.8)   $  (.8)     $ (2.1)   $ (2.1)
      Foreign, state & local       (.6)      (.5)       (1.8)     (1.6)
      Total current               (1.4)     (1.3)       (3.9)     (3.7)

  Deferred
    Federal                       (9.8)     (8.3)      (25.7)    (26.8)
    Foreign, state & local          -         -           -         - 
      Total deferred              (9.8)     (8.3)      (25.7)    (26.8)

     Total                      $(11.2)   $ (9.6)     $(29.6)   $(30.5)
</TABLE>

  Consolidated income tax expense differs from the amount computed
using the United States statutory income tax rate for the reasons set forth
in the following table:
<TABLE>
<CAPTION>                                   (In Millions)
                              Three Months Ended      Nine Months Ended
                                 September 30,           September 30,  
                               1995         1994        1995      1994
  <S>                           <C>       <C>         <C>       <C>
  Earnings from continuing
    operations before income 
    taxes                       $ 29.4    $ 34.8      $ 77.7    $ 16.4
 
  Expected tax expense at U.S.
    statutory income tax rate   $(10.3)   $(12.1)     $(27.2)   $ (5.7)
  Amortization of goodwill        (1.1)      (.9)       (3.1)     (2.9)
  Capital loss not utilized         -         -           -      (20.0)
  Other, net                        .2       3.4          .7      (1.9)
  Consolidated income tax    
    expense                     $(11.2)   $ (9.6)     $(29.6)   $(30.5)
</TABLE>


 8.   COMMITMENTS AND CONTINGENCIES

Pre-Reorganization Contingencies
  The following matters arose out of railroad operations disposed of
by the Company's predecessor, Penn Central Transportation Company ("PCTC"),

                                 - 11 -
<PAGE>

prior to its bankruptcy reorganization in 1978 and, accordingly, any
ultimate liability arising therefrom in excess of previously established
loss accruals would be attributable to pre-reorganization events and
circumstances.  In accordance with the Company's pre-reorganization
accounting policy, any such ultimate liability will reduce the Company's
capital surplus and shareholders' equity, but will not be charged to
income.

  USX Litigation
  In May 1994, lawsuits were filed against the Company by USX
Corporation ("USX") and its former subsidiary, Bessemer and Lake Erie
Railroad Company ("B&LE"), seeking contribution by the Company, as the
successor to the railroad business conducted by PCTC prior to 1976, for all
or a portion of the approximately $600 million that USX paid in
satisfaction of a judgment against B&LE for its participation in an
unlawful antitrust conspiracy among certain railroads commencing in the
1950's and continuing through the 1970's.  The lawsuits argue that USX's
liability for that payment was attributable to PCTC's alleged activities
in furtherance of the conspiracy.  On October 13, 1994, the U.S. District
Court for the Eastern District of Pennsylvania enjoined USX and B&LE from
continuing their lawsuits against the Company, ruling that their claims are
barred by the 1978 consummation order issued by that Court in PCTC's
bankruptcy reorganization proceedings.  USX and B&LE have appealed the
District Court's ruling to the U.S. Court of Appeals for the Third Circuit. 
If the Court of Appeals were to allow these lawsuits to proceed in spite
of the bankruptcy consummation order, the Company believes that it would
prevail on the merits.  For further information, see Part II, Item 1 of
this Report.

  Environmental Matters
  The Company is a party or named as a potentially responsible party
in a number of proceedings and claims by regulatory agencies and private
parties under various environmental protection laws, including the
Comprehensive Environmental Response, Compensation and Liability Act
("CERCLA"), seeking to impose responsibility on the Company for hazardous
waste remediation costs at certain railroad sites formerly owned by PCTC
and at certain other sites where  hazardous waste allegedly generated by
PCTC's railroad operations is present.  It is difficult to estimate the
Company's liability for remediation costs at these sites for a number of
reasons, including the number and financial resources of other potentially
responsible parties involved at a given site, the varying availability of
evidence by which to allocate responsibility among such parties, the wide
range of costs for possible remediation alternatives, changing technology
and the period of time over which these matters develop.  Nevertheless, the
Company believes that its previously established loss accruals for
potential pre-reorganization environmental liabilities at such sites are
adequate to cover the probable amount of such liabilities, based on the
Company's estimates of remediation costs and related expenses at such sites
and its estimates of the portions of such costs that will be borne by other
parties. Such estimates are based on information currently available to the

                                  - 12 -
<PAGE>
Company and are subject to future change as additional information becomes
available.  Such estimates do not assume any recovery from the Company's
insurance carriers, although the Company does intend to seek reimbursement
from certain insurers for such remediation costs as the Company incurs. 
  In terms of potential liability to the Company, the Company believes
that the most significant such site is the railyard at Paoli, Pennsylvania
("Paoli Yard") which PCTC transferred to Consolidated Rail Corporation
("Conrail") in 1976.  A Record of Decision issued by the U.S. Environmental
Protection Agency in 1992 presented a final selected remedial action for
clean-up of polychlorinated biphenyls ("PCB's") at Paoli Yard having an
estimated cost of approximately $28 million.  The Company has accrued a
substantial portion of such estimated clean-up costs in its financial
statements (in addition to related expenses) but has not accrued the entire
amount because it believes it is probable that other parties, including
Conrail, will be responsible for substantial percentages of the clean-up
costs by virtue of their operation of electrified railroad cars at Paoli
Yard that discharged PCB's at higher levels than discharged by cars
operated by PCTC.
  In management's opinion, the outcome of the foregoing environmental
claims and contingencies will not, individually or in the aggregate, have
a material adverse effect on the financial condition of the Company.  In
making this assessment, management has taken into account previously
established loss accruals in its financial statements and probable
recoveries from third parties.

Post-Reorganization Contingencies
  In connection with the Company's sale on June 9, 1994 of its General
Cable Corporation subordinated notes and common stock, the Company assumed
responsibility for certain actual and potential environmental and other
liabilities in consideration of a $19.2 million payment to the Company. 
On June 30, 1994, the Company  established a loss accrual in that amount
in its financial statements.  Although it is difficult to estimate future
environmental remediation costs accurately for the reasons discussed above,
the Company believes that the Indemnity Payment will provide sufficient
funds to permit the Company to discharge such liabilities as they become
payable over time.


 9.   STATEMENT OF CASH FLOWS
  During the nine month periods ended September 30, 1995 and 1994,
state and other income taxes paid were $3.2 million and $5.5 million,
respectively.  For the same periods, interest paid was $37.7 million and
$36.6 million, respectively.



                                 - 13 -
<PAGE>
<PAGE>
Item 2.   Management's Discussion and Analysis of Financial
          Condition and Results of Operations


  The following discussion and analysis is provided to assist the
reader in understanding the Company's financial condition as of September
30, 1995 and December 31, 1994 and its results of operations for the three
months and nine months ended September 30, 1995 and 1994.

LIQUIDITY AND CAPITAL RESOURCES
<TABLE>
<CAPTION>                                            (Dollars in Millions)
                                                September 30, December 31,
                                                        1995         1994 
  <S>                                              <C>          <C>
  Cash, Parent Company short-term investments
    and Parent Company fixed maturity securities   $   94.7     $  838.5
  Deduct items not readily available for
    corporate purposes:
      Cash held by the insurance operations           (36.3)       (36.3)
      Securities held in bank escrow accounts         (12.7)       (21.2)
      Private placement notes                         (23.3)       (23.0)
  Cash, short-term investments and marketable
    securities                                     $   22.4     $  758.0


  Total debt as a percentage of total capital           20%          25%
</TABLE>

  The Company's Federal income tax loss carryforward is available to
offset taxable income and, as a result, the Company's requirement to
currently pay Federal income tax is substantially eliminated.  The $735.6
million decrease during the nine months ended September 30, 1995 in the
cash, short-term investments and marketable securities included in the
preceding table was attributable principally to loans made to AFC under the
AFC Credit Agreement, the repayment of Company debt and purchases of
Company Common Stock.  Partially offsetting these decreases were net
advances received from AFG under the AFG Credit Agreement.

Net Cash Provided by Operating Activities

  During the nine months ended September 30, 1995, cash provided by
operating activities was $93.1 million, a decrease of $144.9 million as
compared with the same period in 1994.  This decrease resulted primarily
from a decrease in the insurance operations' operating cash flow at the
workers' compensation insurance operations ("Republic Indemnity") and, to
a lesser extent, the non-standard private passenger automobile insurance

                                 - 14 -
<PAGE>

companies (the "NSA Group").  The decrease in operating cash flow at
Republic Indemnity resulted primarily from a decrease in written premiums
due to 1994 mandatory premium rate reductions and extremely competitive
pricing in the marketplace resulting from the repeal of the California
workers' compensation minimum rate law effective January 1, 1995.  The
decrease in operating cash flow at the NSA Group resulted principally from
an increase in claims payments and a decrease in the rate of written
premium growth.  Management expects that the Company's operating cash flow
and financial resources will continue to be adequate to meet its operating
needs in the short-term and long-term (i.e. more than twelve months)
future.  Cash flow of the Company may be influenced by a variety of
factors, including changes in the property and casualty insurance industry,
the insurance regulatory environment and general economic conditions.
  During the nine months ended September 30, 1995, the insurance
operations generated $124.2 million of operating cash flow, approximately
67 percent of which was retained by the insurance companies to purchase
investments, principally marketable debt securities.  The remainder of the
cash provided by the insurance operations was paid to the Parent Company
through dividends and intercorporate tax allocation payments.  During the
same period in 1994, the insurance operations generated $266.9 million of
operating cash flow, 82 percent of which was retained by the insurance
companies to purchase investments.
  The Company's insurance operations are subject to state regulations
which limit, by reference to specified measures of statutory operating
results and policyholders' surplus, the dividends that can be paid to the
Parent Company without prior regulatory approval.  Without such approval,
the maximum amount of dividends which can be paid to the Parent Company
during the remainder of 1995 by these subsidiaries is $61.9 million.


Investing and Financing Activities

  During the nine months ended September 30, 1995, sales and maturities
of the Parent Company investment portfolio (net of purchases of
investments) provided $762.1 million.  The Company also received $55.3
million in advances from AFG under the AFG Credit Agreement (net of $10.2
million advanced to AFG primarily related to expenses of the Acquisition)
and an aggregate of $20.7 million from the sale of one of its insurance
subsidiaries to AFC and from the sale of one of its industrial businesses. 
During this same period, the Company used $559.6 million for loans to AFC
under the AFC Credit Agreement, $143.6 million to repurchase a portion of
its subordinated notes, $87.6 million for purchases of shares of Company
Common Stock and $21.7 million for the payment of Common Stock dividends
prior to the merger.  The Company's insurance operations made net purchases
of investments of $68.6 million during the first nine months of 1995.
  During the same 1994 period, net purchases of investments for the
Parent Company investment portfolio totalled $184.4 million.  The Company
also used $16.2 million to redeem all of its outstanding 9 1/2 percent
subordinated debentures, $16.3 million for purchases of shares of Company
Common Stock and $30.4 million for the payment of Common Stock dividends. 

                                 - 15 -
<PAGE>
During this same period, the Company received $176.7 million from the sale
of its General Cable notes and stock, $34.9 million from the sale of three
of its non-insurance businesses and $15.0 million for shares of Company
Common Stock issued pursuant to the exercise of stock options.  During the
first nine months of 1994, the Company's insurance operations made net
purchases of investments of $198.2 million. 
  The Company continues to limit its investment in unrated or less than
investment grade securities of any one issuer and regularly monitors the
condition of the issuers and their industries.  At September 30, 1995, the
largest investment of the Company and its insurance operations in such
securities of any one issuer totalled $30.8 million.
  During the nine months ended September 30, 1995, the Company's
continuing operations did not have large capital spending requirements. 
The Company presently has no plans or commitments for material capital
expenditures.


Borrowing Facilities and Debt Obligations

  At September 30, 1995, the Company's total debt to total capital
ratio decreased to 20 percent from 25 percent at year-end 1994, principally
as a result of the Company's repurchase of a portion of its subordinated
notes during 1995.  Total capital as defined for this ratio consists of
debt, minority interests in subsidiaries and common shareholders' equity.
  During the 1995 third quarter, approximately $44 million principal
amount of Notes tendered to the Company pursuant to the Put Right were
purchased by the Company at 100 percent of principal amount plus accrued
interest.  See Note 5 of Notes to Financial Statements.

RESULTS OF OPERATIONS

Analysis of Continuing Operations

  The Company reported net earnings from continuing operations for the
three and nine months ended September 30, 1995 of $18.2 million and $48.1
million, respectively, compared to net earnings from continuing operations
of $25.2 million for the 1994 third quarter and a net loss from continuing
operations of $14.1 million for the first nine months of 1994.  Results for
the first nine months of 1994 included a net realized capital loss of $70.3
million principally from the disposal of the General Cable Corporation
subordinated notes previously owned by the Company and tax adjustments
related primarily to the disposal of certain subsidiaries.  Income from
continuing operations for the three and nine months ended September 30,
1995, excluding net realized capital gains was $13.8 million and $42.9
million, respectively.  Excluding net realized capital gains and losses and
tax adjustments, income from continuing operations for the same periods in
1994 was $22.0 million and $56.2 million, respectively.
                                  - 16 -
<PAGE>  
  Revenues in the Insurance operations for the three and nine months
ended September 30, 1995 of $413.9 million and $1,253.2 million,
respectively, decreased as compared with revenues of $443.6 million and
$1,256.3 million, respectively, for the same periods in 1994.  The decrease
in revenues was due primarily to a decrease in earned premiums at Republic
Indemnity, partially offset by an increase in earned premiums at the NSA
Group.  During both the third quarter and first nine months of 1995,
investment income before realized gains and losses on sales of investments
in the insurance operations' portfolio increased due to higher average
investment balances.  Operating income in the Insurance operations for the
three and nine months ended September 30, 1995 of $27.0 million and $90.8
million, respectively, decreased as compared with operating income of $45.9
million and $128.8 million for the same periods in 1994, primarily due to
a decrease in underwriting profits, partially offset by higher investment
income and net realized gains.  The combined ratio for the Insurance
operations was 103.1 percent and 101.9 percent, respectively, for the three
and nine months ended September 30, 1995, as compared with 95.8 percent and
96.4 percent for the same periods in 1994.
  For the third quarter and first nine months of 1995, net written
premiums of the NSA Group grew 2 percent and 8 percent respectively, over
the comparable 1994 periods due to increased penetration within
the NSA Group's existing markets, limited expansion into new states and an
increase in premium rates.  The NSA Group experienced an underwriting loss
for the first nine months of 1995 due mainly to inadequate rate levels in
certain markets and to hail-related losses in Texas aggregating
approximately $15.6 million.  In addition, underwriting results reflect
reserve strengthening during the third quarter related to prior accident
years (4.6 points of the third quarter combined ratio).  These factors were
partially offset by a reduction in the underwriting expense ratio due
largely to cost control measures.  Premium rate increases were implemented 
in several states during 1994 and the NSA Group has continued to increase
rates in 1995 in response to declining underwriting margins.  Rate
increases implemented and to be implemented in various states during 1995
will average approximately 10 percent across the NSA Group's entire book
of business.  The higher rate levels and competitive pressures in the non-
standard automobile insurance industry have impacted the written and earned
premium growth rates during 1995 and there can be no assurance that growth
rates experienced in recent periods will be sustained in the future.
  Republic's net written premiums declined 50 percent and 39 percent
for the third quarter and first nine months of 1995, respectively, due to
1994 mandatory premium rate reductions, a portion of which were phased in
over the course of the policy terms in 1994 and 1995, and the impact of the
repeal of the workers' compensation minimum rate law effective January 1,
1995.  As a consequence of the repeal of this law, Republic's rate levels
contemplate the change in its mix of business toward non-participating
policies which do not require the payment of policyholder dividends. 
Furthermore, Republic has encountered extremely competitive pricing in the
marketplace during the first nine months of 1995.  Despite lower premium
volume, the combined ratio was lower for the three and nine months ended
September 30, 1995 mainly because of lower policyholder dividends, and a
reduction in the amount of policyholder dividends estimated to be incurred,
partially offset by an increase in the frequency of claims.  Also, the
underwriting expense ratio increased for the 1995 periods primarily due to
the decline in earned premiums coupled with higher commission rates as
compared to the 1994 periods. 
                                   - 17 -    
<PAGE>

Interest and Dividend Income

  Interest and dividend income from Parent Company investments
increased $5.4 million and $17.0 million for the three and nine month
periods ended September 30, 1995, as compared with the same periods in
1994.  Interest and dividend income for the third quarter and first nine
months of 1995 includes $15.2 million and $28.6 million, respectively, of
interest on loans made to AFC pursuant to the AFC Credit Agreement. 
Excluding such interest, Parent Company interest and dividend income
decreased due primarily to lower average investment balances, partially
offset by an increase in average yields.


Other Operations
  For the three and nine months ended September 30, 1995, net sales,
cost of sales and other operating and general expenses decreased as
compared with the same periods in 1994 primarily as a result of the sales
of the Company's non-insurance operations during 1994 and the early part
of 1995.

Income Taxes

  For the three and nine months ended September 30, 1995, the Company
recorded income tax expense of $11.2 million and $29.6 million,
respectively, as compared with income tax expense of $9.6 million and $30.5
million, respectively, for the same periods in 1994.  Income tax expense
for the first nine months of 1994 reflects less than full realization of 
the tax benefit attributable to the net realized capital loss recorded in
that period.  See Note 7 of Notes to Financial Statements.
  Management believes that it is more likely than not that the net
deferred tax asset at September 30, 1995 will be realized primarily through
the generation of taxable income during the loss carryforward period.  This
belief derives from an analysis of estimated future taxable income based
on certain assumptions concerning future events during the loss
carryforward period.  The estimate of future taxable income used in
determining the net deferred tax asset is not necessarily indicative of the
Company's future results of operations.  As is the case with any estimate
of future results, there will be differences between assumed and actual
economic and business conditions of future periods.  Moreover, the estimate
may also be affected by unpredictable future events, including but not
necessarily limited to changes in the Company's capital structure and
future acquisitions and dispositions.  Therefore, the analysis of estimated
future taxable income will be reviewed and updated periodically, and any
required adjustments, which may increase or decrease the net deferred tax
asset, will be made in the period in which the developments on which they
are based become known. 
                                   - 18 -
<PAGE>
<PAGE>
                       

                         PART II - OTHER INFORMATION

Item 1.   Legal Proceedings

  Reference is made to Item 3 - "Legal Proceedings" of the Company's
Annual Report on Form 10-K for 1994 for a description of certain lawsuits
brought against the Company by USX Corporation ("USX") and Bessemer and
Lake Erie Railroad Company ("B&LE").  As stated therein, on October 13,
1994, the U.S. District Court for the Eastern District of Pennsylvania
enjoined USX and B&LE from continuing their lawsuits, ruling that their
claims are barred by the 1978 consummation order issued by the Court in the
Company's bankruptcy proceedings.  USX and B&LE appealed the District
Court's ruling to the U.S. Court of Appeals for the Third Circuit. 
Briefing of the appeal has been completed, the case was orally argued on
July 24, 1995 and the parties are awaiting the Court of Appeals' decision. 
If the Court of Appeals were to reverse the District Court and allow these
lawsuits to proceed in spite of the bankruptcy consummation order, the
Company believes that the defenses described in said Form 10-K would enable
it to prevail on the merits.


Item 6.   Exhibits and Reports on Form 8-K

(a) Exhibits:
  
    27     Financial data schedule (Copy included in Report filed
           electronically with the Securities and Exchange Commission.)


(b) Reports on Form 8-K filed during the quarter ended September 30,
    1995:

    Current Report on Form 8-K (Items 4 and 7) dated August 29, 1995.








                                 - 19 -
PAGE
<PAGE>

                                SIGNATURE



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




                        AMERICAN PREMIER UNDERWRITERS, INC.
                                  (Registrant)




Date: November 13, 1995    By:                                        
                               Fred J. Runk
                               Senior Vice President and Treasurer