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, 1997                                  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, 1997, there were 47,000,000 shares of the
Registrant's Common Stock outstanding, 38,000,000 of which were
owned by American Financial Corporation and 9,000,000 of which
were owned by American Financial Group, Inc.








                          Page 1 of 14

<PAGE>
            AMERICAN PREMIER UNDERWRITERS, INC. 10-Q
                             PART I
                      FINANCIAL INFORMATION

      AMERICAN PREMIER UNDERWRITERS, INC. AND SUBSIDIARIES
                   CONSOLIDATED BALANCE SHEET
                      (Dollars In Millions)


                                                 September 30,   December 31,
                                                         1997           1996
Assets:
Cash and short-term investments                      $  123.2       $   68.5
Investments:
  Bonds and redeemable preferred stocks:
    Held to maturity - at amortized cost
      (market - $246.0 and $292.0)                      243.6          291.3
    Available for sale - at market
      (amortized cost - $1,454.0 and $1,454.6)        1,465.1        1,441.0
  Other stocks - principally at market
    (cost - $51.1 and $77.0)                             60.5           76.3
  Investment in investee                                 38.6           36.6
  Loans receivable                                       24.5           30.8
  Real estate and other investments                       1.3            2.1
    Total investments                                 1,833.6        1,878.1

Accrued investment income                                25.4           29.0
Agents' balances and premiums receivable                317.4          269.1
Amounts due from affiliates                              78.1          151.8
Recoverables from reinsurers and prepaid
  reinsurance premiums                                   72.2           67.6
Other receivables                                        28.3           45.5
Deferred acquisition costs                               89.7           76.3
Cost in excess of net assets acquired                   372.3          378.2
Deferred tax asset                                      117.9          154.7
Other assets                                            147.0          150.4

                                                     $3,205.1       $3,269.2
<PAGE>
Liabilities and Shareholders' Equity:
Unpaid losses and loss adjustment expenses           $1,045.9       $1,048.8
Unearned premiums                                       441.8          379.8
Policyholder dividends                                    9.0           23.8
Long-term debt:
  Parent Company                                        150.4          160.5
  Subsidiaries                                            7.7            8.3
Amounts due to affiliates                               115.1          178.0
Accounts payable and other liabilities                  324.6          425.5
    Total liabilities                                 2,094.5        2,224.7

Shareholders' Equity:
  Common Stock, $1 par value
    47,000,000 shares outstanding                        47.0           47.0
  Capital surplus                                       580.0          580.4
  Retained earnings                                     470.3          426.3
  Net unrealized gains (losses) on marketable 
    securities                                           13.3           (9.2)
    Total shareholders' equity                        1,110.6        1,044.5

                                                     $3,205.1       $3,269.2


                                2
<PAGE>
            AMERICAN PREMIER UNDERWRITERS, INC. 10-Q

      AMERICAN PREMIER UNDERWRITERS, INC. AND SUBSIDIARIES
               CONSOLIDATED STATEMENT OF EARNINGS
                          (In Millions)


                                       Three months ended    Nine months ended
                                          September 30,        September 30,
                                            1997     1996       1997      1996
Income:
  Property and casualty insurance
    premiums                              $338.6   $320.7   $  990.9  $  998.2
  Net investment income                     32.8     55.1       99.9     164.6
  Realized gains (losses) on sales
    of securities                           18.3      (.1)      17.2       6.6
  Equity in net earnings (losses)
    of investee                             (1.8)    (1.4)       2.5       1.6
  Gain on sales of subsidiaries               -        -          -       53.1
  Other income                               4.7      5.2       10.9      11.8
                                           392.6    379.5    1,121.4   1,235.9

Costs and Expenses:
  Property and casualty insurance:
    Losses and loss adjustment expenses    272.0    221.4      766.9     733.7
    Commissions and other underwriting
      expenses                              76.6     69.8      217.7     231.4
  Interest charges on borrowed money         6.1      9.2       20.5      29.6
  Other operating and general expenses      21.4     12.7       45.7      35.5
                                           376.1    313.1    1,050.8   1,030.2

Earnings before income taxes                16.5     66.4       70.6     205.7
Provision for income taxes                   7.6     24.0       25.9      79.0

Earnings before extraordinary item           8.9     42.4       44.7     126.7

Extraordinary item - loss on prepayment
  of debt, net of tax benefit                (.7)      -         (.7)     (4.6)

Net Earnings                              $  8.2   $ 42.4   $   44.0  $  122.1




                                3
<PAGE>
            AMERICAN PREMIER UNDERWRITERS, INC. 10-Q

      AMERICAN PREMIER UNDERWRITERS, INC. AND SUBSIDIARIES
              CONSOLIDATED STATEMENT OF CASH FLOWS
                          (In Millions)

                                                  Nine months ended
                                                    September 30,
                                                    1997       1996
Operating Activities:
  Net earnings                                    $ 44.0     $122.1
  Adjustments:
   Deferred federal income tax                      24.9       75.4
   Extraordinary loss on prepayment of debt           .7        4.6
   Depreciation and amortization                    21.1       22.0
   Equity in net earnings of investee               (2.5)      (1.6)
   Realized gains on investing activities          (17.3)     (61.6)
   Decrease (increase) in receivables              (39.1)      27.5
   Decrease (increase) in other assets             (14.4)       3.4
   Decrease in unpaid losses and loss                      
     adjustment expenses                            (2.9)     (97.0)
   Decrease in policyholder dividends              (14.8)     (26.5)
   Increase (decrease) in unearned premiums         62.0      (44.2)
   Decrease in other liabilities                  (103.0)     (21.2)
   Dividends from investee                            .5         .5
   Other, net                                        (.4)        -
                                                   (41.2)       3.4
Investing Activities:
  Purchases of and additional investments in:
    Fixed maturity investments                    (387.5)    (210.8)
    Equity securities                              (10.9)       (.2)
    Affiliates and subsidiaries                     (5.0)        -
    Property and equipment                          (7.7)      (5.8)
  Maturities and redemptions of fixed maturity
    investments                                    114.2       74.7
  Sales of:
    Fixed maturity investments                     337.3      165.5
    Equity securities                               56.4        1.0
    Affiliates and subsidiaries                       -        66.2
    Real estate, property and equipment              1.2        3.4
  Cash of subsidiaries acquired (sold)                .1       (4.6)
  Decrease (increase) in other investments          (1.2)        .1
                                                    96.9       89.5
Financing Activities:
  Reductions of debt                               (11.7)    (146.0)
  Issuance of debt                                    -        74.0
  Net advances (to) from affiliates                 10.9      (32.7)
  Other, net                                         (.1)        -
                                                     (.9)    (104.7)

Net Increase (Decrease) in Cash and Short-term             
  Investments                                       54.7      (11.8)

Cash and short-term investments at beginning 
  of period                                         68.5      116.4

Cash and short-term investments at end of period  $123.2     $104.6

                                4
<PAGE>
            AMERICAN PREMIER UNDERWRITERS, INC. 10-Q

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

   
A. Accounting Policies

   Basis of Presentation  In April 1995, American Premier Underwriters, Inc. 
   ("APU") became a wholly-owned subsidiary of American Financial Group, Inc. 
   ("AFG"), a new corporation formed by APU for the purpose of acquiring all 
   of the common stock of APU and American Financial Corporation (the
   "Mergers").  As a result of the Mergers, all of the common stock of APU 
   and American Financial Corporation ("AFC") was owned by AFG and AFG became 
   APU's successor as the issuer of publicly held common stock.  At the close 
   of business on December 31, 1996, AFG contributed to AFC 81% of the Common
   Stock of APU.
   
   The accompanying consolidated financial statements for APU are unaudited; 
   however, management believes that all adjustments (consisting only of 
   normal recurring accruals unless otherwise disclosed herein) necessary for 
   fair presentation have been made.  The results of operations for interim 
   periods are not necessarily indicative of results to be expected for the 
   year.  The financial statements have been prepared in accordance with
   the instructions to Form 10-Q and therefore do not include all information 
   and footnotes necessary to be in conformity with generally accepted 
   accounting principles. 

   Certain reclassifications have been made to prior years to conform to the 
   current year's presentation.  All significant intercompany balances and 
   transactions have been eliminated.  All acquisitions have been treated as 
   purchases.  The results of operations of companies since their formation or
   acquisition are included in the consolidated financial statements.
   
   The preparation of the financial statements requires management to make 
   estimates and assumptions that affect the amounts reported in the financial 
   statements and accompanying notes.  Changes in circumstances could cause 
   actual results to differ materially from those estimates.

   Investments   Debt securities are classified as "held to maturity" and 
   reported at amortized cost if APU has the positive intent and ability to 
   hold them to maturity.  Debt and equity securities are classified as 
   "available for sale" and reported at fair value with unrealized gains and 
   losses reported as a separate component of shareholders' equity if
   the securities are not classified as held to maturity or bought and held 
   principally for selling in the near term.  Only in certain limited 
   circumstances, such as significant issuer credit deterioration or if 
   required by insurance or other regulators, may a company change its intent 
   to hold a certain security to maturity without calling into question
   its intent to hold other debt securities to maturity in the future.
<PAGE>   
   Premiums and discounts on mortgage-backed securities are amortized over 
   their expected average lives using the interest method.  Gains or losses 
   on sales of securities are recognized at the time of disposition with the 
   amount of gain or loss determined on the specific identification basis.
   When a decline in the value of a specific investment is considered to be 
   other than temporary, a provision for impairment is charged to earnings 
   and the carrying value of that investment is reduced.

   APU's investments in equity securities of companies that are
   20%-to 50%-owned by AFG and its subsidiaries are carried at
   cost, adjusted for a proportionate share of their undistributed 
   earnings or losses.
                                

                                5
<PAGE>
            AMERICAN PREMIER UNDERWRITERS, INC. 10-Q

     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
   
   
   APU's investment in investee corporation reflects APU's 5%
   ownership (3.2 million shares) of the common stock of Chiquita
   Brands International, Inc. which is accounted for under the
   equity method.  AFG and its other subsidiaries own an
   additional 35% of the common stock of Chiquita.  Chiquita is a
   leading international marketer, producer and distributor of
   bananas and other quality fresh and processed food products.
   The market value of APU's investment in Chiquita was
   approximately $52 million at September 30, 1997.
   
   Short-term investments are carried at cost; loans receivable
   are stated primarily at the aggregate unpaid balance.
   
   Cost in Excess of Net Assets Acquired  The excess of cost of
   subsidiaries over APU's equity in the underlying net assets
   ("goodwill") is being amortized over 40 years.
   
   APU's management continually monitors whether significant
   changes in certain industry and regulatory conditions or
   prolonged trends of declining profitability have occurred
   which would lead APU to question the recoverability of the
   carrying value of its goodwill.  APU's evaluation of its
   recorded goodwill would be based primarily on estimates of
   future earnings, as well as all other available factors which
   may provide additional evidence relevant to the assessment of
   recoverability of its goodwill.
   
   Insurance  As discussed under "Reinsurance" below, unpaid
   losses and loss adjustment expenses and unearned premiums have
   not been reduced for reinsurance receivable.

   Reinsurance  In the normal course of business, APU's insurance
   subsidiaries cede reinsurance to other companies to diversify
   risk and limit maximum loss arising from large claims.  To the
   extent that any reinsuring companies are unable to meet
   obligations under the agreements covering reinsurance ceded,
   APU's insurance subsidiaries would remain liable.  Amounts
   recoverable from reinsurers are estimated in a manner
   consistent with the claim liability associated with the
   reinsurance policies.  APU's insurance subsidiaries report as
   assets (a) the estimated reinsurance recoverable on unpaid
   losses, including an estimate for losses incurred but not
   reported, and (b) amounts paid to reinsurers applicable to the
   unexpired terms of policies in force.  APU's insurance
   subsidiaries also assume reinsurance from other companies.
   Income on reinsurance assumed is recognized based on reports
   received from ceding reinsurers.
<PAGE>
   Deferred Acquisition Costs  Policy acquisition costs
   (principally commissions, premium taxes and other underwriting
   expenses) related to the production of new business are
   deferred.  The deferral of acquisition costs is limited based
   upon their recoverability without any consideration for
   anticipated investment income.  Deferred policy acquisition
   costs are charged against income ratably over the term of the
   related policies.

   Unpaid Losses and Loss Adjustment Expenses  The net
   liabilities stated for unpaid claims and for expenses of
   investigation and adjustment of unpaid claims are based upon
   (a) the accumulation of case estimates for losses reported
   prior to the close of the accounting period on the direct
   business written; (b) estimates received from ceding
   reinsurers and insurance pools and associations; (c) estimates
   of unreported losses based on past experience and (d)
   estimates based on experience of expenses for investigating
   and adjusting claims.


                                6
<PAGE>
            AMERICAN PREMIER UNDERWRITERS, INC. 10-Q

     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

   
   These liabilities are subject to the impact of changes in
   claim amounts and frequency and other factors.  In spite of
   the variability inherent in such estimates, management
   believes that the liabilities for unpaid losses and loss
   adjustment expenses are adequate.  Changes in estimates of the
   liabilities for losses and loss adjustment expenses are
   reflected in the Statement of Earnings in the period
   determined.
   
   Premium Recognition  Premiums are earned over the terms of the
   policies on a pro rata basis.  Unearned premiums represent
   that portion of premiums written which is applicable to the
   unexpired terms of policies in force.  On reinsurance assumed
   from other insurance companies or written through various
   underwriting organizations, unearned premiums are based on
   reports received from such companies and organizations.
   
   Policyholder Dividends  Dividends payable to policyholders
   represent management's estimate of amounts payable on
   participating policies which share in favorable underwriting
   results.  The estimate is accrued during the period in which
   the related premium is earned.  Changes in estimates are
   included in the Statement of Earnings in the period
   determined.  Policyholder dividends do not become legal
   liabilities unless and until declared by the boards of
   directors of the insurance companies.
   
   Income Taxes  APU has filed consolidated federal income tax
   returns which include all 80%-owned U.S. subsidiaries.  As a
   result of the Mergers, AFG (parent) has been included in APU's
   consolidated return for 1995 and 1996.  At the close of
   business on December 31, 1996, AFG contributed 81% of the
   common stock of APU to AFC.  Accordingly, AFC and APU will
   file a single consolidated return for 1997.

   Deferred income taxes are calculated using the liability
   method.  Under this method, deferred income tax assets and
   liabilities are determined based on differences between
   financial reporting and tax bases and are measured using
   enacted tax rates.  Deferred tax assets are recognized if it
   is more likely than not that a tax benefit will be realized.
<PAGE>
   Benefit Plans  APU provides retirement benefits to qualified
   employees of participating companies through contributory and
   noncontributory defined contribution plans.  Contributions to
   benefit plans and savings plans are charged against earnings
   in the year for which they are declared.  APU sponsored
   contributory employee savings plans under which APU matched a
   specified portion of contributions made by eligible employees.
   APU also had Employee Stock Ownership Retirement Plans
   ("ESORP") under which contributions were invested in
   securities of AFG and affiliates for the benefit of APU
   employees.  In 1997, these ESORP plans were combined into a
   new plan.  Like the ESORP plans, the new plan is a
   noncontributory, qualified plan invested in securities of AFG
   and affiliates for the benefit of employees.

   APU and many of its subsidiaries provide health care and life
   insurance benefits to eligible retirees.  APU also provides
   postemployment benefits to former or inactive employees
   (primarily those on disability) who were not deemed retired
   under other company plans.  The projected future cost of
   providing these benefits is expensed over the period the
   employees qualify for such benefits.


                                7
<PAGE>
            AMERICAN PREMIER UNDERWRITERS, INC. 10-Q
                                
     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

   Capital Surplus   Adjustments to claims and contingencies arising from 
   events or circumstances preceding APU's 1978 reorganization are reflected 
   in capital surplus if the adjustments are not clearly attributable to 
   post-reorganization events or circumstances.  Such pre-reorganization 
   claims and contingencies consist principally of personal injury claims 
   by former employees of APU's predecessor and claims relating to the 
   generation, disposal or release into the environment of allegedly 
   hazardous substances arising out of railroad operations disposed of prior 
   to the 1978 reorganization.

   Statement of Cash Flows   For cash flow purposes, "investing activities" 
   are defined as making and collecting loans and acquiring and disposing of 
   debt or equity instruments and property and equipment.  "Financing 
   activities" include obtaining resources from owners and providing them 
   with a return on their investments, borrowing money and repaying
   amounts borrowed.  All other activities are considered "operating".  
   Short-term investments having original maturities of three months or less 
   when purchased are considered to be cash equivalents for purposes of the
   financial statements.
   
B. Divestitures

   In March 1996, APU sold the stock of a subsidiary, Buckeye
   Management Company ("Buckeye"), to an investment group
   consisting of members of Buckeye's management and employees
   for approximately $60 million in cash, net of transaction
   costs.  Buckeye held, directly and indirectly, a 2% general
   partnership interest in Buckeye Partners, L.P. which, through
   its subsidiary entities, was an independent pipeline common
   carrier of refined petroleum products.  APU recorded a pretax
   gain of approximately $53 million from the sale.  The
   Chairman of the Board and Chief Executive Officer of Buckeye
   was also a director of APU, until resigning in March 1996.

C. Long-term Debt
     
   The carrying value of long-term debt consisted of the
   following (in millions):
                                               September 30,  December 31,
                                                       1997          1996
     Parent Company:
      Subordinated notes, 10-7/8%, due 2011          $ 16.5        $ 16.8
      Subordinated notes, 10-5/8%, due 2000            43.0          52.0
      Subordinated notes,  9-3/4%, due 1999            90.9          91.7
                                                      150.4         160.5
     Subsidiaries:
      Other                                             7.7           8.3

         Total                                       $158.1        $168.8
   
<PAGE>   
   During the first nine months of 1997, APU repurchased $10.1 million of 
   its subordinated notes for approximately $11.1 million, resulting in an 
   extraordinary loss of $.7 million.
   
   In 1995, Pennsylvania Company ("Pennco"), a wholly-owned subsidiary of 
   APU, entered into a collateralized five-year reducing revolving credit 
   agreement with several banks, under which it can borrow up to 
   $75 million.  There were no borrowings outstanding under this agreement 
   at September 30, 1997 or December 31, 1996.
   
   
                                
                                8
<PAGE>
            AMERICAN PREMIER UNDERWRITERS, INC. 10-Q

     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


D.  Common Stock

    APU is authorized to issue 200,000,000 shares of Common Stock.  At
    September 30, 1997, there were 47,000,000 shares of Common Stock
    outstanding, 38,000,000 of which were owned by AFC and 9,000,000 of
    which were owned by AFG.

E.  Cash Flows - Fixed Maturity Investments
   
    "Investing activities" related to fixed maturity investments in
    APU's Statement of Cash Flows consisted of the following (in millions):

                                 Held to Available
     1997                       Maturity  For Sale       Total
     Purchases                     $  .1    $387.4      $387.5
     Maturities and redemptions     52.7      61.5       114.2
     Sales                            -      337.3       337.3

     1996
     Purchases                     $11.6    $199.2      $210.8
     Maturities and redemptions     39.1      35.6        74.7
     Sales                            -      165.5       165.5

   
F.  Contingencies

    There have been no significant changes to the matters discussed in 
    Note K - "Contingencies" in APU's Annual Report on Form 10-K for 1996.

G.  Subsequent Event

    On October 22, 1997, APU announced that it has agreed to sell the
    assets of its software solutions and consulting services
    subsidiary, Millennium Dynamics, Inc., to a subsidiary of Peritus
    Software Services, Inc.  APU is to receive $30 million in cash
    and 2,175,000 shares of Peritus common stock on the sale which is
    expected to close in the fourth quarter of 1997.  APU estimates
    that its basis in the subsidiary, plus fees and expenses related
    to the sale, will be approximately $15 million to $20 million.

    

                                9
<PAGE>
            AMERICAN PREMIER UNDERWRITERS, INC. 10-Q

                             ITEM 2

              Management's Discussion and Analysis
        of Financial Condition and Results of Operations


LIQUIDITY AND CAPITAL RESOURCES

Ratios  The ratio of APU's (parent-only) long-term debt to total capital was 
12% at September 30, 1997 and 13% at December 31, 1996.  APU's ratio of 
earnings to fixed charges on a total enterprise basis was 3.92 for the first 
nine months of 1997 and 8.92 for the entire year of 1996.

Sources of Funds     APU is organized as a holding company with almost all 
of its operations being conducted by subsidiaries.  The parent corporation, 
however, has continuing cash needs for administrative expenses, the payment 
of principal and interest on borrowings and dividends on Common Stock.  Thus, 
APU relies primarily on dividends and tax payments from its subsidiaries for
funds to meet its obligations.

Management believes APU has sufficient resources to meet its liquidity 
requirements through operations in the short-term and long-term future.  If 
funds generated from operations, including dividends from subsidiaries, are 
insufficient to meet fixed charges in any period, APU would be required to 
generate cash through borrowings, sales of securities or other assets, or
similar transactions.

APU has a credit agreement with AFG under which APU and AFG could make loans 
of up to $250 million available to each other.  The balance outstanding under 
the credit line bears interest at a variable rate of one percent over LIBOR 
and is payable on December 31, 2010.  Principal amounts payable to AFG under 
the credit agreement totaled $113.1 million (excluding $2.0 million of 
accrued interest) at September 30, 1997 and $175.5 million (excluding 
$2.5 million of accrued interest) at December 31, 1996.

APU and Pennco also have separate revolving credit agreements with two AFC 
subsidiaries under which aggregate loans are available to those subsidiaries 
of up to $170 million.  Loans made under the credit lines bear interest at 
floating rates based on prime or LIBOR.  Aggregate amounts outstanding under 
the credit lines totaled $21.7 million (plus $.4 million of accrued
interest) at September 30, 1997 and $96.5 million (plus $1.0 million of 
accrued interest) at December 31, 1996.

Through 1996, APU has filed consolidated federal income tax returns.  At the 
close of business on December 31, 1996, AFG contributed 81% of the common 
stock of APU to AFC.  Accordingly, beginning with the 1997 federal tax 
return, APU and its 80%-owned U.S. subsidiaries will join AFC's
consolidated federal tax return.  Under tax allocation agreements, APU 
and its insurance subsidiaries generally compute tax provisions as if 
filing separate returns with the resulting provision (or credit) currently 
payable to (or receivable from) AFC.



               
                               10
<PAGE>
            AMERICAN PREMIER UNDERWRITERS, INC. 10-Q

              Management's Discussion and Analysis
  of Financial Condition and Results of Operations - Continued


Investments  Approximately 94% of the bonds and redeemable
preferred stocks held by APU were rated "investment grade"
(credit rating of AAA to BBB) by nationally recognized rating
agencies at September 30, 1997.  Investment grade securities
generally bear lower yields and lower degrees of risk than
those that are unrated and non-investment grade.  Management
believes that the high quality investment portfolio should
generate a stable and predictable investment return.

RESULTS OF OPERATIONS

General  Pretax earnings for the third quarter of 1997 were
$16.5 million, a decrease of $49.9 million from the comparable 1996 
period.  The decrease is attributable to a $39.5 million decrease in 
underwriting results and a $22.3 million decrease in investment income.  
These items were partially offset by an increase of $18.4 million in 
realized gains and a reduction of $3.1 million in interest expense 
resulting from debt retirements in 1996.

Pretax earnings for the nine months ended September 30, 1997 were
$70.6 million, a decrease of $135.1 million from the comparable
1996 period.  Results for 1996 include a $53 million gain from
the sale of Buckeye Management Company.  Excluding the Buckeye
gain and net gains and losses realized on sales of securities,
pretax earnings decreased $92.6 million due primarily to a
$64.7 million decrease in investment income and a $26.8 million
decrease in underwriting results, partially offset by a
$9.1 million decrease in interest expense.

Property and Casualty Insurance  APU manages and operates its
property and casualty business as two major sectors.  The
nonstandard automobile insurance companies ("NSA Group") insure
risks not typically accepted for standard automobile coverage
because of the applicant's driving record, type of vehicle, age
or other criteria.  Republic Indemnity is engaged in the sale
of workers' compensation insurance in California and, to a
lesser extent, in Arizona.  Workers' compensation policies
provide coverage for prescribed benefits that employers are
required to pay employees who are injured in the course of
employment and for an employer's liability for losses suffered
by its employees which are not included within the prescribed
workers' compensation coverage.

Underwriting profitability is measured by the combined ratio
which is a sum of the ratios of underwriting losses, loss
adjustment expenses, underwriting expenses and policyholder
dividends to premiums.  When the combined ratio is under 100%,
underwriting results are generally considered profitable; when
the ratio is over 100%, underwriting results are generally
considered unprofitable.  The combined ratio does not reflect
investment income, other income or federal income taxes.

                               11
<PAGE>
            AMERICAN PREMIER UNDERWRITERS, INC. 10-Q

              Management's Discussion and Analysis
  of Financial Condition and Results of Operations - Continued


Net written premiums and combined ratios for APU's insurance
subsidiaries are as follows (dollars in millions):

                               Three months ended     Nine months ended
                                  September 30,         September 30,
                                  1997       1996        1997      1996
  Net Written Premiums (GAAP)
  NSA Group                     $277.2     $248.0    $  883.5    $783.5
  Republic Indemnity              56.6       54.6       169.5     169.3

                                $333.8     $302.6    $1,053.0    $952.8

  Combined Ratios (GAAP)
  NSA Group                       96.9%      98.1%       97.0%    100.5%
  Republic Indemnity             132.4%      56.3%      111.2%     77.8%
  Aggregate                      102.9%      90.8%       99.3%     96.7%


 NSA Group  For the third quarter and first nine months of 1997,
net written premiums of the NSA Group increased 12% and 13%,
respectively, from the comparable 1996 periods due primarily to
volume increases in California resulting from enactment of
legislation requiring drivers to provide proof of insurance
coverage in order to obtain a valid permit.  The improvement in
the combined ratio reflects rate increases in various states over
the last couple of years.

 Republic Indemnity  Following significant declines during 1995 and 1996 
as a result of mandatory premium rate reductions and an extremely 
competitive pricing environment in the California workers' compensation 
market, net written premiums for Republic Indemnity have stabilized in 
1997 at approximately the same level as in the first nine months of 1996.  
Underwriting results for the third quarter and first nine months of 1997 
declined due primarily to (i) 1996 reductions in reserves for business 
written primarily prior to 1995 in response to fundamental changes in the 
California workers' compensation market and actuarial evaluations, and (ii)
increased losses during the third quarter of 1997 relating to deteriorating 
underwriting margins in business written in 1996 and 1997.

Investment Income  Investment income decreased $22.3 million (40%) during 
the third quarter and $64.7 million (39%) during the first nine months of 
1997 due primarily to a decrease in funds advanced to affiliates and a 
decrease in average investments held resulting from debt repurchases in 1996.  
In December 1996, APU paid a dividend to AFG of $675 million consisting of 
amounts then outstanding under APU's credit line with AFC.  Investment income
includes $4.2 million and $61.8 million earned during the first nine months 
of 1997 and 1996, respectively, on amounts due from affiliates.
<PAGE>
Investee Corporations  Equity in net earnings of investee corporations 
represents APU's proportionate share of the earnings of Chiquita Brands 
International, Inc. Interest on Borrowed Money  Excluding interest on 
amounts due to AFG, interest expense for the third quarter and nine months 
ended September 30, 1997 decreased by $2.7 million (40%) and
$9.7 million (44%), respectively, from the comparable 1996 periods.  The 
decreases reflect the repurchase of subordinated notes during 1996.  Interest 
on amounts due AFG was $7.9 million and $7.3 million during the first nine 
months of 1997 and 1996, respectively.
                                
                                
                               12
<PAGE>
            AMERICAN PREMIER UNDERWRITERS, INC. 10-Q

              Management's Discussion and Analysis
  of Financial Condition and Results of Operations - Continued


Other Operating and General Expenses  Other operating and general
expenses increased $8.7 million (69%) during the third quarter
and $10.2 million (29%) during the first nine months of 1997 due
primarily to costs incurred by APU's software solutions and
consulting services operations which were purchased from a
subsidiary of AFC at the end of the first quarter of 1997.

New Accounting Standards to be Implemented  During 1997, the
Financial Accounting Standards Board issued the following
Statement of Financial Accounting Standards ("SFAS"); the
implementation of these standards will not have a significant
effect on APU's financial position or results of operations.

  SFAS #      Subject of Standard      Period to be Implemented
   129        Capital Structure         4th quarter of 1997
   130        Comprehensive Income      1st quarter of 1998
   131        Segment Information       4th quarter of 1998


                                

                                
                               13
<PAGE>
            AMERICAN PREMIER UNDERWRITERS, INC. 10-Q
                             PART II
                        OTHER INFORMATION



                             ITEM 6
                                
                Exhibits and Reports on Form 8-K


(a)  Exhibits:

      Number        Description

       27           Financial Data Schedule - Included in Report filed
                    electronically with the Securities and Exchange
                    Commission.


(b)   Report on Form 8-K:  None






                            Signature



Pursuant to the requirements of the Securities Exchange Act of
1934, American Premier Underwriters, Inc. has duly caused this
Report to be signed on its behalf by the undersigned duly
authorized.


                              American Premier Underwriters, Inc.



November 13, 1997             BY: /s/ Fred J. Runk
                                 Fred J. Runk
                                 Senior Vice President and Treasurer





                                14