FORM 10-Q
                                   
                             UNITED STATES
                  SECURITIES AND EXCHANGE COMMISSION
                         Washington, DC 20549
                         --------------------
                                   
                                   
                              (Mark One)
      [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (D) OF THE
                    SECURITIES EXCHANGE ACT OF 1934
            For the quarterly period ended:  March 31, 1997
                                             --------------
                                  OR
                                   
      [  ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                    SECURITIES EXCHANGE ACT OF 1934
            For the transition period from:        to
                                   
                                   
                                0-20668
                               ---------
                       (Commission file number)
                                   
                                   
             ALLMERICA PROPERTY & CASUALTY COMPANIES, INC.
             ---------------------------------------------
        (Exact name of registrant as specified in its charter)

                Delaware                                  04-3164595
                --------                                  ---------- 
      (State or other jurisdiction of                  (I.R.S. Employer
       incorporation or organization)                Identification Number)
                            
                                   
          440 Lincoln Street, Worcester, Massachusetts  01653
          ---------------------------------------------------
               (Address of principal executive offices)
                              (Zip Code)
                                   
                            (508) 855-1000
         (Registrant's telephone number, including area code)
                                   
 
 ---------------------------------------------------------------------  
(Former name, former address and former fiscal year, if changed since
                             last report)
                                   

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

           APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
             PROCEEDINGS DURING THE PRECEDING FIVE YEARS:

Indicate  by check mark whether the registrant has filed all documents
and  reports  required to be filed by Section 12, 13 or 15(d)  of  the
Securities  Exchange  Act of 1934 subsequent to  the  distribution  of
securities under a plan confirmed by a court.  Yes [    ]   No  [    ]

                 APPLICABLE ONLY TO CORPORATE ISSUERS:

Indicate  the number of shares outstanding of each of the registrant's
classes  of common stock as of the latest practicable date: 59,651,206
shares of common stock outstanding, as of May 1, 1997.


                                  16
                         Total Number of Pages


                                   
                                   1
                                   
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                           TABLE OF CONTENTS





PART I - FINANCIAL INFORMATION



    ITEM 1 - FINANCIAL STATEMENTS
           Consolidated Statements of Income                        3
           Consolidated Balance Sheets                              4
           Consolidated Statements of Shareholders' Equity          5
           Consolidated Statements of Cash Flows                    6
           Notes to Consolidated Financial Statements               7


    ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS
             OF RESULTS OF OPERATIONS AND FINANCIAL
             CONDITION                                         8 - 14



PART II - OTHER INFORMATION



    ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K                      15




SIGNATURES                                                         16



                                  2
                                  
======================================================================= 
              

               
                    PART I - FINANCIAL INFORMATION

                     ITEM 1 - FINANCIAL STATEMENTS
                                   
             ALLMERICA PROPERTY & CASUALTY COMPANIES, INC.
                   CONSOLIDATED STATEMENTS OF INCOME
                   
<TABLE>
<S>                                                      <C>           <C>                                   
                                   
                                                                 (Unaudited)
                                                             Three Months Ended
(In millions, except per share data)                               March 31,
                                                             1997           1996
                                                         ------------------------   
                                                             
Revenues                                                                         
   Net premiums written                                  $   484.5      $   475.7
   Increase in unearned premiums,                                                
     net of prepaid reinsurance premiums                       9.4           10.6
                                                         ---------      ---------
   Net premiums earned                                       475.1          465.1
   Net investment income                                      61.3           52.3
   Net realized gains on investments                          37.8           45.5
   Other income                                                2.4            0.4
                                                         ---------      ---------
     Total revenues                                          576.6          563.3
                                                         ---------      ---------
                                                                                 
Expenses                                                                         
   Losses and loss adjustment expenses                       346.6          346.2
   Policy acquisition and other operating expenses           156.7          146.5
   Policyholders' dividends                                    1.6            3.1
                                                         ---------      ---------
     Total expenses                                          504.9          495.8
                                                         ---------      ---------
                                                                                 
Income before federal income taxes and minority               71.7           67.5
interest
                                                                                 
Federal income tax expense                                    14.9           13.7
                                                         ---------      ---------
                                                                                 
Income before minority interest                               56.8           53.8
                                                                                 
Minority interest                                            (5.0)          (4.2)
                                                         ---------      ---------
                                                                                 
Net income                                                $   51.8       $   49.6
                                                         =========      =========  
                                                                                 
Per share data 
                                                                  
   Net income                                             $   0.87       $   0.82
                                                         =========      =========
                                                                                 
Dividends declared to shareholders                        $   0.04       $   0.04
                                                         =========      =========
                                                                                 
Weighted average shares outstanding                           59.7           60.5
                                                         =========      =========

</TABLE>    
    
                                   
    The accompanying notes are an integral part of these financial
                              statements
                              


                                   3
                                  
=======================================================================  
                                  

                                   
                                   
                                   
                                   
             ALLMERICA PROPERTY & CASUALTY COMPANIES, INC.
                      CONSOLIDATED BALANCE SHEETS
                      
<TABLE>
<S>                                                       <C>            <C>                      
                                   
                                                                      
                                                         (Unaudited)
(In millions, except share and per share data)
                                                           March 31,     December 31,
                                                              1997           1996
                                                          ---------------------------     
Assets                                                                       
  Investments                                                                
    Debt securities available-for-sale, at fair value     $   3,558.7    $   3,527.6
      (Amortized cost of $3,536.4 and $3,444.7)                                     
    Equity securities available-for-sale, at fair value         311.7          402.9
      (Cost of $213.8 and $277.3)                                                   
    Other investments, at fair value (Cost of $29.5 and          31.3           31.9
      $29.3)                                               ----------     ----------
      Total investments                                       3,901.7        3,962.4
  Cash and cash equivalents                                     122.9           96.9
  Accrued investment income                                      63.3           65.3
  Premiums receivable (less allowance for                                           
    doubtful accounts of $5.5 and $4.5)                         415.3          410.2
  Finance installment receivables                                28.1           29.3
  Reinsurance recoverable on paid and unpaid balances           631.7          669.2
  Prepaid reinsurance premiums                                   40.0           45.5
  Deferred policy acquisition expenses                          166.0          164.2
  Deferred federal income taxes                                 122.6           93.2
  Other assets                                                  172.1          167.7
                                                           ----------     ----------                    
                                                          $   5,663.7    $   5,703.9
                                                           ==========     ==========

Liabilities and Shareholders' Equity                                                
                                                                                    
 Liabilities                                                                        
  Reserve for losses and loss adjustment expenses         $   2,678.5    $   2,744.1
  Unearned premiums                                             819.0          815.1
  Reinsurance premiums payable                                   30.1           31.4
  Commercial paper                                               27.6           28.0
  Other liabilities                                             371.9          344.7
                                                           ----------     ----------    
    Total liabilities                                         3,927.1        3,963.3
                                                           ----------     ----------
                                                                                    
Minority interest                                               132.1          132.1
                                                           ----------     ----------
                                                                                    
                                                                                    
Shareholders' Equity                                                                
  Preferred stock, par value $1.00 per share;                                       
    authorized 20.0 million shares; issued none                     -              -
  Common stock, par value $1.00 per share;                                          
    authorized 90.0 million shares; issued 61.9 million          61.9           61.9
    shares
  Additional paid-in capital                                     32.0           32.0
  Retained earnings                                           1,491.2        1,441.8
  Unrealized appreciation on investments, net of                                    
    deferred federal income taxes and minority interest          73.7          127.1
  Treasury stock, at cost (2.2 million shares in 1997           (54.3)         (54.3)
    and 1996)                                              ----------     ----------    
                                                                                    
    Total shareholders' equity                                1,604.5        1,608.5
                                                           ----------     ----------
                                                                                    
                                                           $  5,663.7    $   5,703.9
                                                           ==========     ==========
                                   
</TABLE>
                                   
                                   
    The accompanying notes are an integral part of these financial
                              statements
                              
                              
                                   4
                                   
=======================================================================  
                                  

             ALLMERICA PROPERTY & CASUALTY COMPANIES, INC.
            CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
            
<TABLE>
<S>                                             <C>            <C>             
                                                                     
                                                                      
                                                          (Unaudited)
 (In millions)                                        Three Months Ended 
                                                           March 31,
                                                      1997         1996
                                                 -------------------------
                                                      
Common stock                                                   
  Balance at beginning and end of period         $     61.9     $     61.9
                                                 ----------     ----------       
                                                               
Additional paid-in capital                                     
  Balance at beginning and end of period               32.0           32.0
                                                 ----------     ----------              
                                                               
Retained earnings                                              
  Balance at beginning of period                    1,441.8        1,304.9
  Net income                                           51.8           49.6
  Dividends declared to shareholders                   (2.4)          (2.4)
                                                 ----------     ----------
  Balance at end of period                          1,491.2        1,352.1
                                                 ----------     ----------              
                                                               
Unrealized appreciation on investments,                        
net of deferred federal income taxes and                       
minority interest
  Balance at beginning of period                      127.1          133.9
  Depreciation during the period                      (89.1)         (78.7)
  Provision for deferred federal income tax            31.2           27.6
    benefit
  Minority interest, net of taxes                       4.5            2.9
                                                 ----------     ----------
  Balance at end of period                             73.7           85.7
                                                 ----------     ----------              
                                                               
Treasury stock                                                 
  Balance at beginning of period                      (54.3)         (23.4)
  Shares purchased at cost                              -            (23.6)
                                                 ----------     ----------
  Balance at end of period                            (54.3)         (47.0)
                                                 ----------     ----------  
                                                               
                                                               
  Total shareholders' equity                    $   1,604.5    $   1,484.7
                                                 ==========     ==========

                                   
</TABLE>                                                       
                              
                                   
                                   
    The accompanying notes are an integral part of these financial
                              statements
                              
                              
                                   5
                                   
======================================================================= 
                  
                                
                                   
                                   
             ALLMERICA PROPERTY & CASUALTY COMPANIES, INC.
                 CONSOLIDATED STATEMENTS OF CASH FLOWS
                 
<TABLE>
<S>                                                   <C>             <C>                 
                                   
                                   
                                                              (Unaudited)
                                                          Three Months Ended
(In millions)                                                  March 31,
                                                            1997         1996
                                                       -------------------------      
Cash was (used for) provided by                                           
Operating Activities
                                                     
Net income                                             $     51.8     $     49.6
Adjustments to reconcile net income to                                   
  net cash (used for) provided by operating                              
  activities:
    Minority interest                                         5.0            4.2
    Net realized gains on investments                       (37.8)         (45.5)
    Deferred federal income tax provision                     1.5            1.5
    Change in assets and liabilities:                                    
      Deferred policy acquisition expenses                   (1.8)          (1.2)
      Premiums and notes receivable, net of                  (7.4)         (39.7)
        reinsurance payable
      Unearned premiums, net of prepaid reinsurance           9.4           10.6
        premiums
      Reserve for losses and loss adjustment                             
        expenses, net of reinsurance recoverable            (28.1)           4.8
      Other, net                                              3.8            1.3
                                                       ----------     ----------
        Net cash used for operating activities               (3.6)         (14.4)
                                                       ----------     ----------  
                                                                         
Investing Activities                                                     
  Proceeds from sale of available-for-sale debt             287.5          446.2
    securities
  Proceeds from available-for-sale debt securities           83.7             -
    maturing or called
  Proceeds from sale of available-for-sale equity                        
    securities and other investments                        113.5          163.7
  Purchases of available-for-sale debt securities          (463.3)        (639.1)
  Purchases of available-for-sale equity securities         (13.4)         (39.2)
    and other investments
  Decrease in net receivable from securities                 25.4          100.3  
    transactions not settled                                 
  Capital expenditures                                       (1.0)          (0.8)
                                                       ----------     ----------
    Net cash provided by investing activities                32.4           31.1
                                                       ----------     ----------
                                                                         
Financing Activities                                                     
  Dividends paid to shareholders                             (2.4)          (2.4)
  Commercial paper redeemed, net                             (0.4)          (3.9)
  Treasury stock purchased, at cost                            -           (23.6)
                                                       ----------     ----------
    Net cash used for financing activities                   (2.8)         (29.9)
                                                       ----------     ----------
                                                                         
Net increase (decrease) in cash and cash equivalents         26.0          (13.2)
                                                                         
Cash and cash equivalents at beginning of period             96.9          125.5
                                                       ----------     ----------
Cash and cash equivalents at end of period             $    122.9     $    112.3
                                                       ==========     ==========
                                   
                                   
</TABLE>                                   
                                   
                                           
                                   
    The accompanying notes are an integral part of these financial
                              statements
                              
                                   6
                                   
=======================================================================
                                   
                                   
                                   
             ALLMERICA PROPERTY & CASUALTY COMPANIES, INC.
              NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


1.    Basis of Presentation

The  accompanying  unaudited  consolidated  financial  statements   of
Allmerica  Property  & Casualty Companies, Inc. (the  "Company")  have
been   prepared  in  accordance  with  generally  accepted  accounting
principles  applicable  to  stock  property  and  casualty   insurance
companies  for interim financial information and with the requirements
of  Form 10-Q.  The financial statements should be read in conjunction
with the financial statements included in the Company's Form 10-K, for
the year ended December 31, 1996.

In  the  opinion of management, the financial statements  reflect  all
adjustments  of  a  normal  recurring  nature  necessary  for  a  fair
presentation  of  the interim periods. Certain reclassifications  have
been  made to the 1996 consolidated financial statements in  order  to
conform to the 1997 presentation.  Interim results are not necessarily
indicative  of results expected for the entire year.  These  financial
statements should be read in conjunction with the Company's 1996  Form
10-K  filed with the Securities and Exchange Commission.


2.    Earnings Per Share

Earnings  per share are based on a monthly weighted average of  shares
outstanding.   The weighted average number of shares of  common  stock
and  equivalents was 59.7 million and 60.5 million for the three month
periods ended March 31, 1997 and 1996, respectively.  On December  27,
1994,  the Board of Directors of the Company authorized the repurchase
of  up  to  three  million  shares, or  nearly  five  percent  of  its
outstanding common stock. The Company purchased a total of 2.1 million
shares since the implementation of the repurchase program.

Recently  the FASB issued Statement of Financial Accounting  Standards
No.  128,   Earnings Per Share, which supersedes APB Opinion  No.  15,
Earnings   Per  Share.   This  standard  replaces  the   primary   EPS
requirements  with  a  basic  EPS  computation  and  requires  a  dual
presentation of basic and diluted EPS for those companies with complex
capital  structures.  The Company intends to adopt  the  standards  of
Statement  No. 128 for financial statements issued after December  15,
1997.   The  impact of this statement is expected to be immaterial  on
the Company's EPS calculation.


3.    Proposed Transaction

On  February 19, 1997, Allmerica Financial Corporation ("AFC") and the
Company  entered  into an Agreement and Plan of  Merger  (the  "Merger
Agreement")  pursuant to which AFC will acquire all of the outstanding
Common  Stock, $1.00 par value per share, of the Company that it  does
not already own for consideration consisting of $17.60 in cash without
interest  and 0.4 shares of AFC Common Stock, $.01 par value,  subject
to adjustment.  The maximum number of shares of AFC Common Stock to be
issued  in  the  Merger is approximately 9.67 million  shares.   Also,
immediately  prior  to  the  Merger,  the  Company's  Certificate   of
Incorporation  will  be amended to authorize a  new  class  of  Common
Stock,  one share of which will be exchanged for each share of  Common
Stock currently held by SMA Financial Corp., a wholly-owned subsidiary
of AFC.  The consummation of the Merger is subject to the satisfaction
of   various   conditions,  including  the  approval   of   regulatory
authorities.


                                  7
                                  
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                    PART I - FINANCIAL INFORMATION

                                ITEM 2
                                   
            MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS
                 OF OPERATIONS AND FINANCIAL CONDITION


The results of operations for Allmerica Property & Casualty Companies,
Inc.  and  subsidiaries  (the  "Company")  include  the  accounts   of
Allmerica  Property  & Casualty Companies, Inc. ("Allmerica  P&C"),  a
non-insurance   holding   company;  The  Hanover   Insurance   Company
("Hanover"), a property and casualty insurance company wholly owned by
Allmerica  P&C; Citizens Corporation, a non-insurance holding  company
for  Citizens Insurance Company of America (collectively, "Citizens");
and  certain other insurance and non-insurance subsidiaries.   Hanover
owns 82.5% of the outstanding common stock of Citizens Corporation.


Results of Operations
---------------------

Consolidated Overview

Net Income

The Company's consolidated net income increased $2.2 million, to $51.8
million, or $0.87 per share, in the first quarter of 1997, compared to
net income of $49.6 million, or $0.82 per share for the same period in
1996.   Net realized gains were $37.8 million during the first quarter
of  1997,  versus $45.5 million during the comparable period of  1996,
reflecting  a  decrease in the sale of equity securities  by  Hanover.
Excluding  realized  gains  and losses,  net  of  taxes  and  minority
interest, net income increased  $7.7 million, to $29.5 million in  the
first quarter of 1997.  This increase is primarily attributable  to  a
$9.0  million increase in net investment income, in addition to a $2.9
million  decrease  in  the  underwriting  loss.   The  growth  in  net
investment  income  resulted primarily from  an  increase  in  average
invested  assets and the Company's portfolio shift to higher  yielding
debt  securities,  including longer duration and non-investment  grade
securities.   The  slight  improvement  in  underwriting  results   is
primarily  attributable to decreased catastrophes  and  other  weather
related  losses  at  Hanover, partially offset  by  reduced  favorable
development  of  prior  year  reserves at Hanover  and  higher  policy
acquisition  and  other  underwriting expenses  at  both  Hanover  and
Citizens.  Federal income tax expense increased $1.2 million, to $14.9
million  during the first quarter of 1997, and the effective tax  rate
increased from 20.3% in the first quarter of 1996, to 20.8%,  for  the
same  period  in 1997.  Minority interest in Citizens net  income  was
$5.0  million  in the first quarter of 1997, compared to $4.2  million
during the first quarter of 1996.

Underwriting results

Consolidated net premiums earned increased $10.0 million, or 2.2%,  to
$475.1  million  in  the first quarter of 1997. Personal  segment  net
premiums  earned increased $15.2 million, or 5.4%, to $295.4  million,
reflecting  the  accounting  effects of  restructuring  a  reinsurance
contract at Hanover, increasing both net premiums earned and losses in
the  personal  automobile  line  by approximately  $4.0  million.   In
addition, increases since March 31, 1996, of 2.6% in policies in force
in  Hanover's personal automobile line and 2.5% in
policies  in  force in Hanover's homeowners line, contributed  to  the
increase in net premiums earned.  Growth in Citizens' personal segment
is  attributable  to  increases in net premiums  earned  in  Ohio  and
Indiana  resulting  from  expansion in these states,  a  $3.0  million
decrease in premiums ceded to Michigan Catastrophic Claims Association
(MCCA)  and to increases in personal automobile and homeowners  rates.
Commercial segment net premiums earned decreased $5.2 million, or 2.8%
to  $179.7  million. This decrease is primarily attributable  to  rate
reductions  in  the  workers compensation line  at  both  Hanover  and
Citizens.

The  consolidated  underwriting loss for the  first  quarter  of  1997
decreased  $2.9  million  to  a loss of  $27.8  million.  This  slight
improvement  in  underwriting  results is  primarily  attributable  to
decreased  catastrophes and other weather related losses  at  Hanover,
partially  offset  by  reduced favorable  development  of  prior  year
reserves   at  Hanover  and  higher  policy  acquisition   and   other
underwriting   expenses  at  both  Hanover  and   Citizens.     Policy
acquisition and other underwriting expenses increased $8.2 million, or
5.6%,  to  $154.7 million during the first 



                                  8
                                  
=======================================================================



quarter of 1997 reflecting increased involuntary pool related expenses
at Hanover, in addition to higher technology expenses  at both Hanover
and Citizens.

Investment results

Net  investment income before taxes increased $9.0 million, or  17.2%,
to  $61.3  million during the first quarter of 1997 compared to  $52.3
million  in the comparable quarter of 1996. The increase in the  first
quarter  of  1997  is primarily the result of an increase  in  average
invested  assets and the Company's portfolio shift to higher  yielding
debt  securities,  including longer duration and non-investment  grade
securities.  The average pre-tax yield  on debt  securities  was  6.8%
and  6.0%  for  the  first  quarter of 1997  and  1996,  respectively.
Average  invested assets increased $97.4 million, or 2.5%, to $3,932.1
million  at March 31, 1997 compared to $3,834.7 million at  March  31,
1996.

Net  realized gains on investments before taxes were $37.8 million and
$45.5  million  in  the first quarter of 1997 and 1996,  respectively.
The  decrease  in  net  realized gains in the first  quarter  of  1997
reflects  a decrease in the sale of equity securities at Hanover.   In
both  periods,  net realized investment gains resulted primarily  from
the  sale  of  appreciated equity securities,  due  to  the  Company's
strategy of shifting to a higher level of debt securities.

Federal Income Taxes

The  provision for federal income taxes was $14.9 million in the first
quarter of 1997 compared to $13.7 million in the comparable period  of
1996.   The  increase in 1997 represents an increase in the  effective
tax rate from 20.3% in 1996 to 20.8% in 1997.



Segment Results
----------------

Personal Segment

The personal segment represented 62.2% and 60.2% of total net premiums
earned in the first quarter of 1997 and 1996, respectively.


<TABLE>                                         Hanover               Citizens             Consolidated
<S>                                       <C>        <C>        <C>        <C>        <C>        <C>         
For the Quarters Ended                       1997       1996       1997       1996        1997       1996
March 31, (In millions)                   ------------------    ------------------      -----------------
                                                                                             
Net premiums earned                       $ 151.7    $ 145.1    $ 143.7     $ 135.1    $ 295.4    $ 280.2
                                                                                                      
Losses and loss adjustment expenses         112.8      116.3      113.8       107.4      226.6      223.7
                                                                                                      
Policy acquisition and other underwriting                                                             
  expenses                                   51.0       49.0       39.5        36.4       90.5       85.4
                                          ------------------    -------------------     -----------------
                                                                                                      
Underwriting loss                         $ (12.1)   $ (20.2)   $  (9.6)    $  (8.7)   $ (21.7)   $ (28.9)
                                          ==================    ===================     =================


</TABLE>

Revenues

Personal  segment  net premiums earned increased   $15.2  million,  or
5.4%, to $295.4 million during the first quarter of 1997, compared  to
$280.2  million  in  the  first quarter of 1996.   Hanover's  personal
segment net premiums earned increased $6.6 million, or 4.5%, to $151.7
million during the first quarter of 1997.  This increase was primarily
attributable to an increase in the personal automobile line associated
with  the  accounting effects of restructuring a reinsurance contract,
increasing net premiums earned by approximately $4.0 million.  A  2.6%
increase in polices in force in the personal automobile line  as  well
as a 2.5% increase in policies in force in the homeowners' line, since
March  31,  1996,  also contributed to the increase  in  net  premiums
earned.   These  increases were partially offset by  a  mandated  6.2%
decrease  in  Massachusetts  personal automobile  rates  which  became
effective January 1, 1997.  In March 1997, the Massachusetts  Division
of Insurance approved Hanover's plan to offer a safe driver's discount
of  10%  on automobile insurance premiums.  Management believes  these
rate decreases may unfavorably impact premium growth in Massachusetts.
Approximately  39%  of  Hanover's  personal  automobile  business   is
currently written in Massachusetts.



                            9
                            
=======================================================================  


Citizens' personal segment net premiums earned increased $8.6 million,
or  6.4%,  to  $143.7  million in the first  quarter  of  1997.   This
increase is primarily attributable to a decrease in premiums ceded  to
MCCA  and  to  increases in personal automobile and homeowners  rates.
The non-recurring decrease in premiums ceded to MCCA was a result of a
lower  surcharge  effective January 1, 1997  for  personal  automobile
policies  written.  This growth is partially offset by a 2.0% decrease
in  policies in force in the personal automobile line since March  31,
1996, attributable to continued strong competition in Michigan.

Underwriting results

The  personal segment underwriting loss in the first quarter  of  1997
decreased  $7.2  million,  to  a loss  of  $21.7  million.   Hanover's
underwriting  results  improved $8.1  million,  to  a  loss  of  $12.1
million.   Citizens' underwriting loss increased $0.9  million,  to  a
loss of $9.6 million.

Hanover's  personal segment losses and LAE decreased $3.5 million,  or
3.0% to $112.8 million in the first quarter of 1997.  This decrease is
primarily attributable to a $18.2 million decreases in losses and  LAE
in  the  homeowners line resulting from decreased catastrophes  during
the  first  quarter of 1997. Catastrophe losses in Hanover's  personal
segment  decreased $16.1 million, to $1.7 million in the first quarter
of  1997  from  $17.8 million during the comparable  period  of  1996.
These  decreases were significantly offset by a $14.8 million increase
in   losses  and  LAE  in  the  personal  automobile  line,  primarily
reflecting a $9.0 million reduction in favorable development of  prior
year  reserves  and  an increase in current year claims  severity,  in
addition  to the aforementioned accounting effects of restructuring  a
reinsurance contract.

Citizens' underwriting loss increased $0.9 million to a loss  of  $9.6
million  during  the  first  quarter  of  1997.   Catastrophe   losses
increased $1.2 million over the prior year first quarter, primarily in
the homeowners line.

Policy  acquisition and other underwriting expenses  in  the  personal
segment increased $5.1 million, or 6.0%, to $90.5 million in the first
quarter   of  1997,  reflecting  increased  involuntary  pool  related
expenses  at  Hanover,  growth  in net premiums  earned  primarily  at
Citizens, and higher technology expenses at both Hanover and Citizens

Commercial Segment

The  commercial  segment  represented 37.8% and  39.8%  of  total  net
premiums earned in the first quarter of 1997 and 1996, respectively.


<TABLE>                                         Hanover               Citizens             Consolidated
<S>                                       <C>        <C>        <C>        <C>        <C>        <C>     

For the Quarters Ended                       1997       1996       1997       1996        1997       1996
March 31, (In millions)                   ------------------    ------------------     ------------------
                                                                                            
Net premiums earned                       $ 113.5    $ 115.5    $  66.2     $  69.4    $ 179.7    $ 184.9
                                                                                                      
Losses and loss adjustment expenses          75.3       74.4       44.7        48.1      120.0      122.5
                                                                                                      
Policy acquisition and other underwriting                                                             
  expenses                                   46.5       43.7       17.7        17.4       64.2       61.1

Policyholders' dividends                       -         1.3        1.6         1.8        1.6        3.1
                                          ------------------    -------------------    ------------------
                                                                                                     
Underwriting loss                         $  (8.3)   $  (3.9)   $   2.2    $    2.1   $   (6.1)   $  (1.8)
                                          ==================    ===================     =================


</TABLE>


Revenues

Commercial  segment  net premiums earned decreased  $5.2  million,  or
2.8%,  to  $179.7  million in the first quarter  of  1997.   Hanover's
commercial  segment  net premiums earned decreased  $2.0  million,  or
1.7%,  to  $113.5 million. This decrease is primarily attributable  to
rate  decreases  of  6.7%  since January  1,  1997,  in  the  workers'
compensation  line. Citizens' commercial segment net  premiums  earned
decreased  $3.2  million,  or 4.6%, to $66.2  million,  in  the  first
quarter of 1997.  This decrease is primarily attributable to decreases
in rates for workers'



                                 10
                                 
=======================================================================  


compensation.  Rates  in  this  line  were  decreased  6.4%  and  8.7% 
effective  June 1, 1996  and  March 1, 1997, respectively.  Management   
believes competitive  conditions in the workers' compensation line may 
impact future growth in net premiums earned.

Underwriting results

The commercial segment underwriting loss for the first quarter of 1997
increased   $4.3  million,  to  a loss  of  $6.1  million.   Hanover's
underwriting  loss increased $4.4 million, to a loss of  $8.3  million
and  Citizens' underwriting profit increased $0.1 million, to a profit
of $2.2 million in the first quarter of 1997.

Hanover's commercial segment losses and LAE increased $0.9 million, or
1.2%, to $75.3 million in the first quarter of 1997. This increase  is
primarily attributable to increases in losses and LAE in the  workers'
compensation and commercial automobile lines of $5.1 million and  $6.1
million, respectively.  The increase in the workers' compensation line
resulted  from  a  decrease in favorable claims  experience  on  prior
accident years in addition to an increase in loss severity. Commercial
automobile  losses  and LAE increased as a result of  a  reduction  in
favorable  claims experience on prior accident years.  These increases
were  significantly  offset by a decrease in losses  and  LAE  in  the
commercial multiple peril lines of $7.0 million, to $35.6 million  due
to  an  increase in favorable development on prior accident years,  as
well  as  a  decrease in catastrophes from $5.8 million in  the  first
quarter of 1996 to $2.1 million in 1997.

Citizens'  losses and LAE decreased $3.4 million, or  7.1%,  to  $44.7
million  in  the first quarter of 1997.  This reflects a  decrease  in
losses  and LAE in the workers' compensation line of $5.7 million,  or
28.9%,  to  $14.0  million, primarily as a result of favorable  claims
activity in prior accident years.

Policy  acquisition and other underwriting expenses in the  commercial
segment increased $3.1 million, or 5.1%, to $64.2 million in the first
quarter  of  1997,  primarily  attributable  to  increased  technology
expenses at both Hanover and Citizens.



                               11
                               
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Reserve for  Losses and Loss Adjustment Expenses
------------------------------------------------

The Company regularly updates its reserve estimates as new information
becomes  available  and  further events occur  which  may  impact  the
resolution of unsettled claims. Changes in prior reserve estimates are
reflected  in  results  of operations in the  year  such  changes  are
determined  to  be  needed and recorded. The table  below  provides  a
reconciliation of the beginning and ending reserve for  unpaid  losses
and LAE as follows:

<TABLE>
<S>                                                    <C>           <C>

For the three months ended March 31, (In millions)          1997          1996                   
                                                       ------------------------
                                                       
Reserve for losses and LAE, beginning of period        $  2,744.1    $  2,896.0

Incurred losses and LAE, net of reinsurance                              
recoverable:      
                                                       
   Provision for insured events of the current              382.2         377.6
   period                                   
   
   Decrease in provision for insured events of              (35.6)        (31.4)
   prior years                                         ----------    ----------
     
Total incurred losses and LAE                               346.6         346.2

                               
Payments, net of reinsurance recoverable:                                
                                                                         
   Losses and LAE attributable to insured events            111.4         111.0
   of current period  
                                                  
   Losses and LAE attributable to insured events            269.2         232.7
   of prior years                                      ----------    ----------

Total payments                                              380.6         343.7

                         
Change in reinsurance recoverable on unpaid                 (31.6)        (29.7)
losses                                                 ----------    ----------


Reserve for losses and LAE, end of period              $  2,678.5    $  2,868.8
                                                       ==========    ==========
                                                       
</TABLE>                                                       


As part of an ongoing process, the reserves have been re-estimated for
all prior accident years and were decreased by $35.6 million and $31.4
million  for  the three month periods ended March 31, 1997  and  1996,
respectively.  The increase in favorable development on  prior  years'
loss  reserves of $4.2 million results primarily from a $12.4  million
increase  in  favorable development at Citizens to $20.5 million.  The
favorable  reserve  development at Citizens in  both  years  primarily
reflects the initiatives taken by Citizens to manage medical costs  in
both  automobile lines and the workers' compensation line, as well  as
the   impact  of  the  Michigan  Supreme  Court  ruling  on   worker's
compensation indemnity payments, which decreases the maximum amount to
be  paid  for  indemnity  cases  on all existing  and  future  claims.
Hanover's  favorable  development  decreased  $8.2  million  to  $15.1
million  during the first quarter of 1997.  This decrease is primarily
attributable  to  decreased  favorable  development  in  the  personal
automobile  and workers' compensation lines, partially  offset  by  an
increase  in  favorable development in the commercial  multiple  peril
line.

The  company  regularly reviews its reserving techniques, its  overall
reserving  position  and  its reinsurance.  Based  on  (i)  review  of
historical  data,  legislative enactments, judicial  decisions,  legal
developments in impositions of damages, changes in political attitudes
and  trends in general economic conditions, (ii) review of  per  claim
information, (iii) historical loss experience of the Company  and  the
industry,  (iv) the relatively short-term nature of most policies  and
(v)  internal estimates of required reserves, management believes that
adequate   provision  has  been  made  for  loss  reserves.   However,
establishment  of  appropriate reserves  is  an  inherently  uncertain
process  and  there  can  be  no certainty  that  current  established
reserves will prove adequate in light of subsequent actual experience.
A  significant change to the estimated reserves could have a  material
impact on the results of operations.



                                  12
                                  
=======================================================================  


Investment Portfolio
--------------------

The  Company's  investment  portfolio  decreased  $60.7  million,   to
$3,901.7 at March 31, 1997 from $3,962.4 million at December 31, 1996.
Hanover's  investment portfolio decreased $37.0 million,  to  $2,320.2
million,  and Citizens' investment portfolio decreased $25.7  million,
to $1,579.5 million.  These decreases were primarily attributable to a
decrease in unrealized appreciation of $53.4 million during the  first
quarter of 1997.  Debt securities increased $31.1 million, to $3,558.7
million, from $3,527.6 million and represented 91.2% and 89.0%  of the
carrying  value of all investments at March 31, 1997 and December  31,
1996,  respectively.  This increase is consistent with  the  Company's
strategy  of increasing the level of debt securities in the  portfolio
which  was  accomplished, in part, by reducing the level of  equities.
Tax-exempt  securities decreased $41.1 million, to  $2,220.1  million,
from  $2,261.2 million during 1997 and represented 62.4% and 64.1%  of
the  total  debt securities at March 31, 1997 and December  31,  1996,
respectively.   The  Company may make modest extensions  in  portfolio
incremental credit risk and adjustments to its taxable and  tax-exempt
positions in the future to seek to maximize after tax income.

At March 31, 1997, $311.7 million, or 8.0% of the investment portfolio
was invested in equity securities compared to $402.9 million, or 10.2%
at December 31, 1996.


Liquidity and Capital Resources
-------------------------------

Liquidity  describes  the ability of a company to generate  sufficient
cash flows to meet the cash requirements of business operations.  As a
holding  company,  Allmerica P&C's primary  source  of  cash  for  the
payment  of  dividends  to  its shareholders  is  dividends  from  its
insurance  subsidiaries.  However, dividend payments to Allmerica  P&C
by  its  insurance subsidiaries are subject to limitations imposed  by
state regulators, such as the requirement that cash  dividends be paid
out of unreserved and unrestricted earned surplus and restrictions  on
the payment of "extraordinary" dividends, as defined.

Sources  of  cash  for the Company's insurance subsidiaries  are  from
premiums   collected,  investment  income  and  maturing  investments.
Primary  cash  outflows are paid losses and loss adjustment  expenses,
policy   acquisition   expenses,  other  underwriting   expenses   and
investment purchases.  Cash outflows related to claim losses and  loss
adjustment   expenses  can  be  variable  because   of   uncertainties
surrounding  settlement dates for liabilities for  unpaid  losses  and
because  of the potential for large losses either individually  or  in
the  aggregate.   Accordingly, the Company's strategy  is  to  monitor
available  cash  and  short-term investment balances  in  relation  to
projected  cash  needs  by  matching maturities  of  investments  with
expected  payments of current and long-term liabilities.  The  Company
periodically  adjusts its investment policy to respond to  changes  in
short-term and long-term cash requirements.

Net  cash  used  for operating activities for the three  months  ended
March   31,  1997  and  1996  was  $3.6  million  and  $14.4  million,
respectively.  This decrease is primarily attributable to an  increase
in  net  investment income, in addition to the timing of cash receipts
and payments of premiums and claims, respectively.

Net  cash provided by investing activities for the three months  ended
March  31,  1997  and  1996  was  $32.4  million  and  $31.1  million,
respectively.  In 1997 and 1996, net cash provided resulted  from  net
sales  of equity securities and other investments in addition  to  the
timing  of  cash payments to settle securities transactions, partially
offset by net purchases of debt securities.

Net  cash  used  for financing activities for the three  months  ended
March 31, 1997 and 1996 was $2.8 million and $29.9, respectively.   In
the  first quarter of 1997, the Company did not repurchase its  common
stock,  while  during  the  comparable period  of  1996,  the  Company
repurchased .9 million shares at a cost of $23.6 million.

Shareholders' equity was $1,604.5 million at March 31, 1997, or $26.88
per  share,  compared  to $1,608.5 million at December  31,  1996,  or
$26.99  per  share. Shareholders' equity reflects net income  for  the
period,  the repurchase of treasury stock and the impact  of  a  $53.4
million  decrease  in the fair values of available-for-sale  debt  and
equity  securities.  Changes in shareholders' equity  related  to  the
unrealized values of underlying portfolio investments will continue to
be volatile as market prices of debt securities fluctuate with changes
in the interest rate environment.


                                  13
                                  
======================================================================= 


The  Company  expects to continue to pay dividends in the  foreseeable
future.  However, payment of future dividends is subject to the  Board
of  Directors'  approval  and  is  dependent  upon  earnings  and  the
financial condition of the Company.

Based  on  current trends, the Company expects to continue to generate
sufficient  positive  operating  cash  to  meet  all  short-term   and
long-term  cash requirements.  The Company maintains a high degree  of
liquidity within the investment portfolio in fixed maturities,  common
stock  and  short-term investments.  The Company  also  has  unsecured
lines  of  credit  with certain banks to support its commercial  paper
borrowings.   At March 31, 1997, these lines totaled $40  million  and
are  subject to annual renewal.  There were no borrowings under  these
lines  of  credit during the first quarter of 1997.  In addition,  the
holding  company's  financial structure provides  the  flexibility  to
obtain funds externally through debt or equity financing, if needed.

Recent Developments

On  February  19, 1997, AFC and the Company entered into an  Agreement
and Plan of Merger (the "Merger Agreement") pursuant to which AFC will
acquire  all  of  the outstanding Common Stock, $1.00  par  value  per
share,  of  the Company that it does not already own for consideration
consisting  of $17.60 in cash without interest and 0.4 shares  of  AFC
Common  Stock,  $.01  par value, subject to adjustment.   The  maximum
number  of  shares of AFC Common Stock to be issued in the  Merger  is
approximately  9.67 million shares.  Also, immediately  prior  to  the
Merger, the Company's Certificate of Incorporation will be amended  to
authorize  a  new class of Common Stock, one share of  which  will  be
exchanged  for  each  share  of Common Stock  currently  held  by  SMA
Financial  Corp., a wholly-owned subsidiary of AFC.  The  consummation
of  the  Merger is subject to the satisfaction of various  conditions,
including the approval of regulatory authorities.

On  January 2, 1997, Hanover declared an extraordinary dividend in the
amount  of  $120.0 million, payable on or after January  21,  1997  to
Allmerica  P&C.  The dividend which was approved by the New  Hampshire
Insurance Department on January 9, 1997, is to be paid in a  lump  sum
or  in  such  installments as Allmerica P&C, in  its  discretion,  may
determine.   As  of  March 31, 1997, no payments  have  been  made  to
Allmerica P&C.

Forward Looking Statements

The  Company  wishes  to caution readers that the following  important
factors,  among others, in some cases have affected and in the  future
could  affect,  the  Company's  actual results  and  could  cause  the
Company's actual results for 1997 and beyond to differ materially from
those  expressed  in any forward-looking statements  made  by,  or  on
behalf  of, the Company.  When used in the MD&A discussion, the  words
"believes,"  "anticipated,"  "expects"  and  similar  expressions  are
intended  to  identify  forward-looking  statements.   See  "Important
Factors Regarding Forward-Looking Statements" filed as Exhibit 99.1 to
the Company's 1996 Form 10-K and incorporated herein by reference.

Factors that may cause actual results to differ materially from  those
contemplated  or  projected, forecast, estimated or budgeted  in  such
forward-looking  statements  include  among  others,   the   following
possibilities:  (i) adverse catastrophe experience and severe weather;
(ii)  adverse loss development for events the Company insured in prior
years;  (iii) heightened competition, including the intensification of
price  competition, the entry of new competitors and the  introduction
of  new products by new and existing competitors;  (iv) adverse  state
and federal legislation, including decreases in rates, limitations  on
premium levels, increases in minimum capital and reserve requirements,
benefit  mandates,  limitations on the  ability  to  manage  care  and
utilization, and tax treatment of insurance products; (v)  changes  in
interest  rates  causing a reduction of investment income  or  in  the
market value of interest rate sensitive investments;  (vi) failure  to
obtain  new  customers,  retain existing customers  or  reductions  in
policies  in  force  by  existing customers;   (vii)  higher  service,
administrative  or  general expense due to  the  need  for  additional
advertising,  marketing,  administrative  or  management   information
systems  expenditures;  (viii) loss or retirement of  key  executives;
(ix)  increases in medical costs, including increases in  utilization,
costs  of medical services, pharmaceuticals, durable medical equipment
and  other  covered  items; (x) termination of provider  contracts  or
renegotiation  at less cost-effective rates or terms of payment;  (xi)
changes  in  the  Company's liquidity due  to  changes  in  asset  and
liability  matching;  (xii)  restrictions on  insurance  underwriting,
based  on  certain  criteria; (xiii) adverse changes  in  the  ratings
obtained  by independent rating agencies such as Moody's,  Standard  &
Poor's and A.M. Best.



                                 14
                                 
=======================================================================  

                                   
                      PART II - OTHER INFORMATION
                                   
                                ITEM 6


                    Exhibits and Reports on Form 8-K

(a)  Exhibits.

         EX - 11         Statement regarding computation of per share earnings.
         EX - 27         Financial Data Schedule

(b)  Reports on Form 8-K

     On  February  20, 1997, a report on Form 8-K was  filed  reporting
     under  item 5, Other Events, the announcement that the Registrant  and
     AFC  entered into an agreement and plan of merger, pursuant  to  which
     AFC  will acquire all of the remaining shares of common stock  of  the
     Registrant that it did not already own.

                                   
                                   
                                  15
                                  
======================================================================= 



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

             Allmerica Property & Casualty Companies, Inc.
                              Registrant




Dated   May 14, 1997         /s/ John F. O'Brien
                             ------------------------------------ 
                             John F. O'Brien
                             President and Chief Executive
                             Officer


Dated   May 14, 1997         /s/ Edward J. Pary III
                             ------------------------------------ 
                             Edward J. Parry III
                             Vice President, Chief Financial
                             Officer, Treasurer and Principal
                             Accounting Officer
                             
                             
                             
                                  16
                             
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